Zoho founder Sridhar Vembu has warned that the US stock market is in a “clear, massive bubble” and drew parallels to past financial crises, particularly the 2008-09 one. His remarks came after economist Gita Gopinath cautioned that investors’ wealth is now more heavily tied to US stocks than ever before, and that even a single market correction could trigger consequences worse than those seen after the dot-com crash. She added that the problem lies with “unbalanced growth” and not “unbalanced trade”.
‘US stock market in massive bubble’
“I agree with Dr Gita Gopinath,” said Vembu on X (formerly Twitter), before adding, “The US stock market is in a clear and massive bubble.”
He then drew parallels with the 2008-09 global financial crisis and said that the high levels of borrowing in the financial markets increase risk. “The degree of leverage in the system means that we cannot rule out a systemic event like the global financial crisis of 2008-9.”
Vembu shares views on gold
He further said that gold, which many bet on, is also flashing a “big warning signal”.
“I don’t think of gold as an investment, I think of it as insurance against systemic financial risk,” the entrepreneur further said.
Vembu went on to say, “Ultimately, finance is all about trust, and when debt levels reach this high, trust breaks down.”
He ended his post with a dash of sarcasm, saying, “I am sure AI will work hard to repay all the debt in the system.”
I agree with Dr Gita Gopinath.
The US stock market is in a clear and massive bubble.
The degree of leverage in the system means that we cannot rule out a systemic event like the global financial crisis of 2008-9.
Gold is also flashing a big warning signal. I don’t think of… https://t.co/7xVPL3FXDq
— Sridhar Vembu (@svembu) October 18, 2025
How did social media users react to his post?
One person said, “If we want fewer bubbles, we need to stop mixing up two things: building real value today vs selling a story about tomorrow.”
“Absolutely. The U.S. debt explosion and the equity bubble since the Fed’s interventions have only deepened systemic risks. It’s a ticking time bomb,” commented another.
A third posted, “Sharp analysis. Warning signs are undeniable.”
“This exponential bubble will burst soon, and remember it will be BRUTAL,” commented a fourth.
Disclaimer:
FinancialExpress.com does not endorse any specific investment instruments. Readers are encouraged to make their own informed decisions, as any losses incurred will be their sole responsibility.