Lots of people were sounding the alarm while the .com bubble was inflating.

Yes, absolutely yes, The dotcom bubble was precipitated by lots of people in mainstream media sounding the alarm. Ditto for the real estate bubble that led to the stock market collapse of 2008.

Short answer --- yes.

AI does not reflect reality. It struggles to tell the difference between fact and fiction. And it will gladly invent info in order to pacify the user.

Likewise, the investment being poured into this flawed technology does not reflect economic reality.

Reality is nothing if not persistent and will eventually intrude on this fantasy.

John Kenneth Galbraith says in his book The Great Crash 1929 that most knew it was heading for a fall, but everyone assumed they could get out before losing their money. Turns out the order system was over-whelmed so they couldn't get out.

Maybe in these times it will be a flash crash that catches everyone off guard. A flash crash that doesn't rebound like the one in 2010

https://en.wikipedia.org/wiki/2010_flash_crash

Yes. Simplistically, its all about incentives, “you've got to dance while the music is playing.” If a professional money manager doesnt follow the mania theyre going to significantly underperform their competitors/benchmarks. If they underperform for multiple quarters theyre going to lose allocation, customers, and their jobs. See also the “perma bears” who have predicted “15 of the last 3 recessions.”

As an individual you can change your risk profile by rebalancing or profit taking during the mania. trying to find quality places to put your gains to reduce the downside risk. That said, in even a moderate correction youre going to underperform the index due to the silly magnitude of those mania gains over time. Eg an additional 2 years of +30% and then a 25% correction is going to outperform your “safe” 7% returns.