JP Morgan Vice Chair: AI Correction is “Probable”

One of the most significant interventions in the current market turmoil has come from the banking sector. Daniel Pinto, Vice Chairman of JP Morgan Chase, has gone on record stating that a correction in booming AI valuations is “probable.” Speaking at a business summit, Pinto noted that the current market pricing assumes a level of productivity and speed of adoption that may not materialize as quickly as investors hope. His comments have added authoritative weight to the growing fears of a tech bubble.
Pinto’s warning is not about a total collapse, but a necessary realignment. He pointed out that the massive valuations of companies like Nvidia—now worth over $4 trillion—require perfection to be sustained. Any stumble, or any reassessment of the timeline for AI profitability, could trigger the correction he predicts. Crucially, he warned that this would not be isolated, but would “create a correction in the rest of the segment, the S&P and in the industry.”
The market seems to be listening. The cryptocurrency sector, which often acts as a leveraged bet on tech sentiment, has crashed, losing $1 trillion in value. Bitcoin has fallen 27% to $91,212. The logic is that if the biggest bank in the US is calling for caution, the time for speculative gambling is over.
This banking outlook aligns with the survey from Bank of America, which found that nearly half of fund managers view an AI bubble as the biggest threat to the market. When bankers and fund managers agree on a risk, it usually leads to a tightening of liquidity. This is already visible in the falling prices of gold and the slide in global equity indices from the FTSE 100 to the Nikkei.
The message from the banking giant is clear: the hype cycle is nearing its end, and the fundamental reality check is beginning. Investors who ignore these signals do so at their own risk, as the “smart money” begins to position itself for a downturn.