A range of equity market bubble indicators suggest that while the S&P 500’s rally still has room to run this year, its medium-term prospects appear poor given the market’s frothy conditions, according to Capital Economics. “Most indicators suggest the AI equity boom is nearing an end,” Capital Economics’ senior market economist James Reilly said Thursday in a note. Capital has maintained a more bullish stance than most on the stock market since mid-2023, reflecting a view that AI will be a transformative technology. Its year-end 2026 S&P 500 forecast has consistently been above consensus. However, the firm has also maintained that the AI-driven rally is a bubble that will eventually burst. To assess and spot a late-stage market bubble, Reilly examines eight indicators including valuations, earnings, index concentration, equity issuance, and foreign interest in U.S. equities. Some of these measures are already at or near levels that preceded previous stock market peaks. The analysis reveals that while market variables such as earnings expectations appear consistent with a market top, others like volatility and leverage look slightly less alarming. Earnings stand out as the most significant warning sign. Expectations for S&P 500 earnings growth are at levels seen only at the peak of the dot-com bubble, while long-term EPS growth forecasts have surged to a record high. According to Reilly, the heavy concentration of this expected growth in the tech sector means that any signs of weakness in tech firms’ earnings will weigh heavily on the index. Other indicators are also flashing warning signs. Index concentration is near dot-com-era extremes, net equity issuance has turned positive, and foreign ownership of U.S. stocks is at a record high. Reilly noted that another wave of IPOs and share sales could be particularly significant, as similar issuance booms have historically coincided with market peaks. “Based on past performance, this suggests that the end of the bubble is just months away, rather than years,” he said. Measures of leverage are not yet alarming compared to other factors, though the analyst warns they are heading in a “concerning direction.” While volatility metrics appear consistent with a mid-stage bubble, Reilly notes that constituent-level volatility isn’t as extreme as it was near the end of the dotcom boom. “While we continue to believe that the S&P 500 will rally from around 7,650 now to 8,250 by end-2026, we ultimately forecast it to fall back to 6,500 by end-2027,” he wrote. These assumptions would equate to an 8% upside this year and a 21% decline in 2027.

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The hit comedy series South Park has revealed it will be rebranded as South America ahead of launching its 29th season on September 16.

Creators Trey Parker and Matt Stone explained that, “Motivated by the courage and patriotism of Apple and Google, we are renaming South Park to SOUTH AMERICA. We especially want to thank our parent company Paramount—a Skydance Capitulation.”

Their announcement follows President Donald Trump’s executive order to rename Lake Ontario as Lake America amid a trade dispute with Canada, a change Canadian officials have refused to acknowledge.

Apple and Google subsequently updated their mapping services, displaying “Lake America” to U.S. users while Canadian users still see “Lake Ontario.”

This action came a day after Trump posted AI‑generated messages on Truth Social proposing that New Mexico be called “New America.”

Last year Trump issued an executive order renaming the Gulf of Mexico as the Gulf of America, prompting worldwide criticism.

The series earned an Emmy for Outstanding Animated Program for its episode “Sermon on the Mount,” which debuted last year and satirizes Trump’s presidency.

The reference to a “Skydance Capitulation” follows the $8 billion merger of Paramount with Skydance, a deal cleared by the Federal Communications Commission after Paramount settled a $16 million lawsuit filed by Trump.

Trump claimed that an interview with then‑candidate Kamala Harris, broadcast on CBS’s “60 Minutes” in 2024, was deceptively edited.

In July 2025, Paramount’s subsidiary CBS News announced it would cancel Stephen Colbert’s “The Late Show” for financial reasons, shortly after Colbert accused Paramount of paying Trump a “big fat bribe.” The series’ final episode aired in May.

Neither Paramount nor the White House have yet responded to requests for comment.

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