The Fed is giving indications that rates will be cut. The bubble will not be bursting yet if that happens
If NVIDIA crashes, I can easily see the gov saving it in some way (either massively pumping liquidity or bailing it out). It’s too critical to the US at this point
This is based on a study that "just 5pc of integrated AI pilots are extracting millions in value, while the vast majority remain stuck with no measurable P&L [profit and loss] impact".
I think the conclusions (while possibly true) are not supported here. By comparison, in the stock market in general, just a handful of stocks provide most of the returns over the past few decades. This does not mean the stock market is a bubble or about to burst.
Given how much capital has already been committed to infrastructure development I find it very unlikely that even a Black Monday style market correction will do much to alter the medium and long term outlook for ai development and investment.
Too many people talk about a bubble almost wish-casting that such a thing will make this all go away. It’s probably safest to assume your political enemies won’t be hoisted on their own petard anytime soon.
A good sign the bubble is not actually bursting: a mainstream news publication predicting it. [1]
It's still 1994. We won't be near the top until the Telegraph publishes an article overly exuberant about AI and saying AGI is here.
If every idiot commenting on Reddit, HN, X, and mainstream news publications is pessimistic and constantly shouting "bubble!," then definitionally, we have not reached irrational exuberance and we're not even remotely near the top.
> “When will the internet bubble burst?” the cover story of Barron’s asked on March 20 2000. “That unpleasant popping sound is likely to be heard before the end of this year.”
Again—the internet was a bubble, and yet it eventually far surpassed even the frothiest expectations.
If you're investing for the short-term, do what you gotta do. The AI bubble will burst and lots of superficial companies will be washed away. But we're just getting started. This next wave will make a new round of companies like Netflix, Amazon, Apple, etc.
The funny thing about bubbles is that they are impossible to predict. My sense is that they always go on longer than is at all rational. (Assuming this is a bubble, who knows.)
I’m still waiting for the crypto “bubble” to burst. Seems like we are years overdue ;)
Really dislike the "AI bubble" term conceptually. The mostly probable outcome here (imo) is absolute bloodbath among the startups that are essentially wrappers while the core tech keeps going without missing a beat and does eventually deliver.
It'll burst in the same way crypto burst. The NFTs and the shitcoins and the grifters and the bandwagon hoppers all got washed out, but Bitcoin is still hitting record highs today.
All the smaller AI companies will have to quickly figure out a way to make a profit, or die.
The behemoths and the ones backed by behemoths (Google, Microsoft/OpenAI, Meta, Amazon/Anthropic) will take a good hit but will power through.
NVidia’s PE is below 60 and they have 100% year over year revenue growth. A bubble is typically based on future earnings potential Nvidia is a money printing growth creating machine.
All you have to do for next 3 years is just put blinkers on and remain laser focussed. Ignore everything they throw at you and remain committed in this once in a life opportunity to be part of the movement that will change the world.
Even if AGI never happens, the existing models are already incredibly useful. I’ve switched to OpenAI Plus plan and almost never use Google search anymore. I pay $10/mo for GitHub Copilot for coding. So search and coding use cases are already seeing big improvements. But this same thing needs to happen to pretty much every product. So I think in the worst case they can just divert all of the training resources to just inference and be just fine. Sure the insane valuation multiples will drop if that happens and they will be valued as any other SaaS business.
25 comments
[ 3.2 ms ] story [ 58.9 ms ] thread"The market can stay irrational longer than you can stay solvent." -- John Maynard Keynes
Predicting when a bubble is going to burst is close to impossible.
If NVIDIA crashes, I can easily see the gov saving it in some way (either massively pumping liquidity or bailing it out). It’s too critical to the US at this point
a) AI is a bubble
b) It's about to burst
This is based on a study that "just 5pc of integrated AI pilots are extracting millions in value, while the vast majority remain stuck with no measurable P&L [profit and loss] impact".
I think the conclusions (while possibly true) are not supported here. By comparison, in the stock market in general, just a handful of stocks provide most of the returns over the past few decades. This does not mean the stock market is a bubble or about to burst.
Too many people talk about a bubble almost wish-casting that such a thing will make this all go away. It’s probably safest to assume your political enemies won’t be hoisted on their own petard anytime soon.
It's still 1994. We won't be near the top until the Telegraph publishes an article overly exuberant about AI and saying AGI is here.
If every idiot commenting on Reddit, HN, X, and mainstream news publications is pessimistic and constantly shouting "bubble!," then definitionally, we have not reached irrational exuberance and we're not even remotely near the top.
[1] https://d.newsweek.com/en/full/566807/theinternetbah3.webp (1995)
Again—the internet was a bubble, and yet it eventually far surpassed even the frothiest expectations.
If you're investing for the short-term, do what you gotta do. The AI bubble will burst and lots of superficial companies will be washed away. But we're just getting started. This next wave will make a new round of companies like Netflix, Amazon, Apple, etc.
I’m still waiting for the crypto “bubble” to burst. Seems like we are years overdue ;)
All the smaller AI companies will have to quickly figure out a way to make a profit, or die.
The behemoths and the ones backed by behemoths (Google, Microsoft/OpenAI, Meta, Amazon/Anthropic) will take a good hit but will power through.
Discussions:
Tech, chip stock sell-off continues as AI bubble fears mount
https://news.ycombinator.com/item?id=44965187
Is the A.I. Sell-Off the Start of Something Bigger?
https://news.ycombinator.com/item?id=44963715
Say farewell to the AI bubble, and get ready for the crash
https://news.ycombinator.com/item?id=44964548
A paid product is better than a free one! Who knew it could be!
It's good (maybe even indispensable) for some things. Please don't go "ketchup native" on my ice cream.