Investor Ray Dalio says the stock market is in a huge AI bubble that could burst and drag down the whole economy — bad news for regular people, not just the rich.

• Dalio, who called the 2008 crash, says today's AI mania looks like the 1929 and dot-com bubbles right before they popped.
• Bubbles pop when people who borrowed to bet on a hot new tech suddenly need cash — for taxes, higher rates, or debt — and are forced to sell, dragging prices down.
• The pain spreads through 401(k)s, pensions, and lost jobs; the 2008 crash wiped out over 12 million jobs while bankers got bailed out.
• Dalio warns the Fed is "out of bullets" this time — it can't just print money or buy bad assets to escape another crisis.
• Loosened rules now let investors borrow more, and that heavy borrowing could turn a downturn into a chain of collapses like the banks in 2008.

Outlook: If Dalio and other skeptics are right, a sharp crash and major job losses could hit, though most of Wall Street still insists this time is different.