American trend forecaster Gerald Celente has cautioned investors to anticipate a possible market crash in 2025, driven by what he termed as overhyped artificial intelligence (AI) investments.
According to Celente, the market downturn will likely resemble the 2000 Dot-com crash, a movement that a combination of economic instability and geopolitical tensions would also drive, he said in a YouTube video published on February 27.
Celente’s forecast comes amid a turbulent week for U.S. markets. Major indices—including the S&P 500, the NASDAQ, and the Dow—witnessed significant volatility before recovering on the last day of February.
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The declines were partially triggered by disappointing results from Nvidia (NASDAQ: NVDA), a key player in the AI hardware space, despite its earnings exceeding expectations.
Following the announcement of the results, Nvidia’s stock plummeted significantly before making a short-term recovery.
“The numbers came up better than expected, but they weren’t that great as they should have been,” Celente said.
Impact NVDA stock performance
According to Celente, Nvidia’s performance can be viewed as a symptom of broader market vulnerabilities. He argued that the AI sector, much like the Dot-com era, is poised for a “bust” due to speculative overinvestment and unrealistic expectations.
“It’s [AI] going to bring us to Dot-com burst that will probably happen this year. <…> China is going to lead the AI trend. They are putting their money into,” he added.
Interestingly, overvaluation concerns have impacted stocks such as American software giant Palantir (NASDAQ: PLTR).
Although the stock has rewarded investors massively due to its AI products that serve both commercial and government clients, analysts warn that the equity is bound to crash as its current valuation does not align with the company’s fundamentals.
Adding fuel to the economic fire, Celente highlighted President Donald Trump’s renewed tariff threats as destabilizing. Trump announced plans to impose 25% tariffs on Canada and Mexico and a 10% tariff on China starting March 4, 2025—a move that rattled markets already reeling from Nvidia’s stumble.
The uncertainty surrounding these policies has contributed to a broader market sell-off, with the S&P 500 remaining in the red for the week and the month.
Concerns over gold’s performance
Beyond AI and tariffs, Celente pointed to a cascade of troubling economic indicators. For instance, gold has failed to mount a push toward the $3,000 spot price, sharply dropping by about $100 to $2,877 an ounce, reflecting a correction he had previously predicted.
At the same time, consumer confidence and sentiment are also declining, while pending home sales hit a record low in January.
“This is serious, very serious,” Celente warned, linking these trends to a potential “office building bust” and a worsening banking crisis as vacancy rates soar and leases from the COVID-19 era expire.
Meanwhile, Celente joins other market players, cautioning about a possible market crash. For instance, as reported by Finbold, investor Robert Kiyosaki has warned that a market downturn is imminent. On the other hand, economist Henrik Zeberg maintained that both the cryptocurrency and stock markets are likely to see a massive rally before experiencing a historic correction.
Featured image via Shutterstock
