Why are companies allowed to lie? I really can’t understand. If a person lies they lose credibility but it doesn’t apply to the rich and powerful.

Lying to investors is illegal, and investors have incentive and means to sue if they think they were defrauded. The problem is proving it. I'm sure a lot of founders genuinely believe AGI is about to appear out of thin air, so they're technically not lying. Even the cynical ones who say whatever they think investors want to hear are hard to catch in a lie. It's not really about being rich and powerful. That's just the unfortunate reality of rhetoric.

In addition to the other comments/answers to this, I would like to add that if you lie to your investors (in public), and they suspect you're lying but also think it will allow you to cash out before the lie becomes apparent, they may not care, especially if the lie is difficult to distinguish from pathological levels of optimism.

Predictions about the future and puffery are not illegal. Lying about facts are. Nobody knows how far away AGI is, everyone just has their own predictions.

It's not a crime to be wrong; it's only a crime to deliberately lie. And unless there's an email saying "haha we're lying to our investors", it's just not easy to prove.