The European Central Bank warns of falling prices in financial markets. “AI sector valuations are high and there is a risk of a sharp price correction,” ECB Vice President Luis de Guindos said on Wednesday during the presentation of the central bank’s financial stability report. “We are not talking about a bubble,” de Guindos stressed several times when asked. But we certainly have doubts that the high stock market prices are justified; investors assume a “favorable scenario” in terms of their expectations for global growth and stability. Valuations on stock exchanges are very high compared to history, but the ECB will not compare the current situation with the bursting of the Internet bubble in 2000, because today’s technology companies have functioning business models and are making a lot of money.
