Yes and no. Compounding market effects can. First order effects? There's a lot of firepower to blunt those.

Especially when the person in the White House is scared about losing the midterms.

"First order effects" I do not know what that means, I can sort of guess.

By now is not the AI market beyond any sensible definition of "first order"?

I meant that the Fed, Treasury, etc. have powerful levels they can pull to head off initial effects.

What can overwhelm them is if those effects cascade and compound into second-order effects, typically multiplied in magnitude.

That's essentially what the fuck-up in 2008 was. The government let Bear Stearns fail because it could handle the effects. What it couldn't handle (or at least, was barely able to) were the second order effects of credit tightening, mortgage derivative repricing, counterparty trust loss, etc. etc.

The government could absolutely prop up the AI bubble, possibly indefinitely. What it can't do is cover second order fallout, if it turns out a lot of risky money was somehow tied into the bubble.