The current surge in stock market valuations driven by enthusiasm over AI have analysts drawing parallels between this AI boom and the late‑1990s dot‑com bubble. Tech companies with strong AI exposure are on the rise, pushing major indices to record highs. Some economists and global institutions warn that although the AI‑investment wave may be real, the productivity gains underpinning the hype are still largely speculative. While the AI boom has rea traction, it may be carrying speculative excess, and investors should be aware of the risks of a bubble‑type event. I think think the hype is going to get ahead of the results.
Interesting that it points out that AI investments are high, but the results might not always be companies making money
ReplyDeleteThe hype feels familiar. Valuations are running ahead of actual results, just like the late 90s. Investors chasing the next big thing might forget that not every AI company will survive long term. We will have to see which firms actually turn innovation into profit once the excitement fades.
ReplyDeleteThat is an interesting comparison, but the further we go with the AI investment, the more sense it makes. If this trend continues with spending towards AI, it will be fascinating to see where this takes us as an economy and a civilization. Another interesting point is that in 10 years' time it will be fascinating to see which AI companies will be "on top" and which ones don't even exist anymore.
ReplyDeleteAfter attending the pitch competitions this morning, I realized that start-ups are basing their entire models on AI, while large companies are quickly replacing human roles with this technology. The shift could prove to be more of a risk than a reward if the expected productivity gains don’t match the hype.
ReplyDeleteI think it is super interesting that entre pitches are placed on AI. Remember last week when so many things related to Amazon and other sites went down? If this were to happen and all businesses were eventually AI based, this would bring everything to a crashing halt.
DeleteI would agree with you that this AI boom has a lot of the same characteristics as the tech boom in the 1990s-2000s era. I think corporations are so deeply invested in AI that it will soon become a function of everyday lives just like the internet did at the turn of the century. What I think investors are overlooking is how all of the big tech firms rely on each other. There seems to be an interconnected dependency of all the firms, where they continue to recycle billions of dollars.
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