QotNews Hacker News, Reddit, Lobsters, and Tildes articles rendered in reader mode.
How big is the stock market’s America bubble? US has grown to nearly two-thirds of global equity market value, but some analysts see danger in ‘huge bet on AI’
The AI 'industry' reminds me so much of the first dotcom bubble.
Everyone is racing to be seen to be doing 'something with AI' in exactly the same way everyone was racing to be 'online'. MBAs with little technical understanding treating it as a marketing checkbox. Shareholders with little technical understanding asking their MBAs 'are we doing something with AI?'
There's no doubt that it has the capacity to change society in similar ways that the internet did, but a fuck load of people are going to lose their lunch before that happens.
Yep. Most AI companies are going to go under, a few unicorns will find viable business plans, the economy will suck for several years. And that is the baseline scenario before potential economic chaos as fallout from Trump policies.
Wasteful spending on boondoggles like Metaverse and AI Everything just shows that these tech companies are flush with cash, and they're wasting it on hype projects instead of putting it to productive uses.
Tax the shit out of them and stop the inefficient hoarding of capital.
"'If you hold a global tracker then by definition two-thirds of that is the US, and a lot of that is in Silicon Valley specifically,' said Paul Marsh, a professor of finance at London Business School who has spent the past 25 years tracking long-run investment returns. 'That means you’re very vulnerable to this huge bet on AI.'"
one thing I feel very confident about is that by the end of 2025 we are going to have a lot of answers to questions like this and we are not going to like them.
The stock market always had a US bias. There are many reasons for it, including the role of the portfolios of Congress Members, ease of access (as an international trader), and it generally being very susceptible to hype based investments (also due to the easy access).
It is like a meta bubble (hehe) that combines all other bubbles and makes them much larger. While this used to be manageable (and exploitable) by large financial institutions, it is becoming more and more unpredictable.
I think many silicon valley billionaires know this by now (they all know Tesla is overvalued, for example), which is why they are currently so keen to get access to other sources of cash (such as stealing tax revenue directly from the orange source).
AI specifically is certainly a dangerous bubble, but at least that money is being spread around a bit, unlike “traditional” tech investing, which in recent years has focused almost exclusively on inflating a few massive “whales”, more or less irrespective of what those businesses are actually doing.
A majority of the businesses floating exclusively on AI hype will sink or get sold for scrap, but a few might actually figure out how to produce something valuable. For the whales, who have also invested heavily in AI, a bubble popping will hurt, but Fidelity and Morgan Stanley aren’t going to suddenly sell off all of their Alphabet, Apple, Meta, and Microsoft shares simultaneously just because the world finally noticed that they have shitty AI integrations.
It’s really exactly like the dot com bubble, when people had to learn the hard way that a company didn’t have value simply because they owned a memorable domain name, they actually had to run a profitable business using it.
HashBrownsOverEasy | 10 months ago
The AI 'industry' reminds me so much of the first dotcom bubble.
Everyone is racing to be seen to be doing 'something with AI' in exactly the same way everyone was racing to be 'online'. MBAs with little technical understanding treating it as a marketing checkbox. Shareholders with little technical understanding asking their MBAs 'are we doing something with AI?'
There's no doubt that it has the capacity to change society in similar ways that the internet did, but a fuck load of people are going to lose their lunch before that happens.
Law_Student | 10 months ago
Yep. Most AI companies are going to go under, a few unicorns will find viable business plans, the economy will suck for several years. And that is the baseline scenario before potential economic chaos as fallout from Trump policies.
UnlimitedCalculus | 10 months ago
Basically, let's survive until 2030 and see where we go from there
Law_Student | 10 months ago
Yeah. If you have investment accounts I recommend getting your money out of the U.S. if you haven't already.
arowthay | 10 months ago
And move it where exactly, lmao. If the US goes under it's bringing the world with it.
Superclustered | 10 months ago
Wasteful spending on boondoggles like Metaverse and AI Everything just shows that these tech companies are flush with cash, and they're wasting it on hype projects instead of putting it to productive uses.
Tax the shit out of them and stop the inefficient hoarding of capital.
BrotherJebulon | 10 months ago
Best we can do is give a Techbro authority to cut govt programs that dont give him noney.
[OP] Maxwellsdemon17 | 10 months ago
"'If you hold a global tracker then by definition two-thirds of that is the US, and a lot of that is in Silicon Valley specifically,' said Paul Marsh, a professor of finance at London Business School who has spent the past 25 years tracking long-run investment returns. 'That means you’re very vulnerable to this huge bet on AI.'"
TheShipEliza | 10 months ago
one thing I feel very confident about is that by the end of 2025 we are going to have a lot of answers to questions like this and we are not going to like them.
tyce_one | 10 months ago
The stock market always had a US bias. There are many reasons for it, including the role of the portfolios of Congress Members, ease of access (as an international trader), and it generally being very susceptible to hype based investments (also due to the easy access).
It is like a meta bubble (hehe) that combines all other bubbles and makes them much larger. While this used to be manageable (and exploitable) by large financial institutions, it is becoming more and more unpredictable.
I think many silicon valley billionaires know this by now (they all know Tesla is overvalued, for example), which is why they are currently so keen to get access to other sources of cash (such as stealing tax revenue directly from the orange source).
username_redacted | 10 months ago
AI specifically is certainly a dangerous bubble, but at least that money is being spread around a bit, unlike “traditional” tech investing, which in recent years has focused almost exclusively on inflating a few massive “whales”, more or less irrespective of what those businesses are actually doing.
A majority of the businesses floating exclusively on AI hype will sink or get sold for scrap, but a few might actually figure out how to produce something valuable. For the whales, who have also invested heavily in AI, a bubble popping will hurt, but Fidelity and Morgan Stanley aren’t going to suddenly sell off all of their Alphabet, Apple, Meta, and Microsoft shares simultaneously just because the world finally noticed that they have shitty AI integrations.
It’s really exactly like the dot com bubble, when people had to learn the hard way that a company didn’t have value simply because they owned a memorable domain name, they actually had to run a profitable business using it.