There's No 'AI Bubble', Says Yahoo Finance Executive Editor (yahoo.com)
- Reference: 0179764432
- News link: https://slashdot.org/story/25/10/12/206215/theres-no-ai-bubble-says-yahoo-finance-executive-editor
- Source link: https://finance.yahoo.com/news/is-the-ai-stock-bubble-about-to-explode-123014740.html
> First of all, AI is a real technology being deployed in real ways inside of Corporate America. Second, this technology is requiring more physical assets in the ground — which are being built to support AI's real-world application. What Zach Dell (son of Michael Dell) is [2]working on at startup Base Power (which just raised $1 billion) impressed me this week. It's addressing a key issue — power availability and costs in part because of rising stress on the grid due to AI development.
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> Next, the spending on AI infrastructure doesn't strike me as reckless. I talk to CFOs and they walk me through their thinking, which seems logical. They aren't foaming at the mouth with wild-eyed predictions of grandeur similar to the late '90s. Plus, the tech giants making the biggest AI investments are fueling their ambitions by cash on hand — not loading up balance sheets with debt. The upstarts in AI are well funded, not being 100% stupid in their organizational build-outs. They're working on tangible technology that has actual orders behind it...
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> Lastly here in my scolding of the AI worrywarts is that valuations don't support the warning calls. According to new research out of Goldman Sachs this week, the median forward P/E ratio across the Magnificent Seven is 27 times, or 26 times if excluding Tesla (TSLA), which has a much higher multiple than the other companies. This is roughly half the equivalent valuation of the biggest seven companies in the late 1990s, while the dominant companies in Japan (mostly banks) traded at higher valuations still. What's more, the current enterprise-to-sales ratios are also much lower than those of the dominant companies in the late 1990s.
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> "So it is true that valuations are high but, in our view, generally not at levels that are as high as are typically seen at the height of a financial bubble," said Goldman Sachs strategist Peter Oppenheimer.
[1] https://finance.yahoo.com/news/is-the-ai-stock-bubble-about-to-explode-123014740.html
[2] https://finance.yahoo.com/video/power-hopes-address-unprecedented-energy-174500717.html
Professional liar says what? (Score:3)
I'll wait for Sam Altman to reassure me that there is no bubble.
Nobody is arguing it's not a real tech (Score:1)
The argument is that there is too many players who aren't going to survive getting too much money. And eventually those players will shake out and the bubble bursts when they do.
It's not a traditional bubble where there isn't anything there it's a bubble because markets consolidate to crazy levels nowadays leaving only a couple of players and everyone else caught holding the bag
Translation (Score:4, Insightful)
"I'm still waiting for my 401K transfer to go through, don't crash the market until Wednesday, please"
What silly arguments... oh, yeah, it's Yahoo (Score:2)
> First of all, AI is a real technology being deployed in real ways inside of Corporate America.
There was lots of real technology being deployed prior to the burst of the DotCom Bubble.
> Next, the spending on AI infrastructure doesn't strike me as reckless.
There were a lot of people who thought the money they were dumping into companies like Kozmo.com was not being spent recklessly.
> Lastly here in my scolding of the AI worrywarts is that valuations don't support the warning calls.
What's funny here is his basic a
Re: (Score:2)
P.S. I do still miss Kozmo.com - it was great while it lasted!
Re: (Score:2)
The dotcom bubble was more of a "internet shiny thing"
All these companies who were not yet on the internet, were getting on the internet. A lot of companies that should never have existed, also got on the internet.
The "the cloud" bubble was another one, with all these moronic companies outsourcing to data centers so they don't need to own the hardware, and then have their ass handed to them when someone forgets to pay a bill, or the data center has poor security.
The AI bubble is far bigger and incestuous be
They are getting truly desperate now (Score:3)
Direct lies is usually the last means to keep the hype going and a sign of imminent collapse.
Re: (Score:2)
Yep, stone cold liar: there's no way a guy in that position would be so stupid as to believe what he's released.
It's two things (Score:3)
Real, rapid progress is being made toward creating useful tools that will help scientists and engineers solve previously intractable problems.
There is an irrational frenzy, driven by hypemongers and pundits that cause investors and gamblers to pour billions into anything with AI in the name as they desperately look for "the next big thing".
So yeah, it has a strong bubblish aroma
Doesn't know what a bubble means? (Score:3)
The internet was also real, that doesn't mean we didn't have a dot-com bubble.
WEAK (Score:1)
Whh are some high level people, as here, so bad at arguing a point?
Just saying "the valuations are fine", "the tech is useful", "the infrastructure is needed" is so lame a defense, he's basically telling us it's farked.
Nothing to see here, keep investing! (Score:3)
Makes me wonder which stocks this guy is investing in.
NVDA Bubble (Score:2)
there is an NVDA bubble, as the GPUs are being sold at outrageous premiums. It's bubbling left and right with de-facto vendor financing (2000 deja-vue) though. Which is not sustainable since a) competition will inevitably kick in, especially for the enormous profit potential as of today b) only a fraction of GPU functionality is needed for the linear algebra operations for LLMs c) hardware optimized for transformers including KV cache are/will be coming and not only from Nvidia, d) hyperscaler customers are
Consider the Source (Score:3)
After all, who would know more than Yahoo about [1]over-inflated valuation [qz.com]?
[1] https://qz.com/741056/the-stunning-collapse-of-yahoos-valuation
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The real tragi/comedy is that we still have Goldman Sachs on a pedestal. They are the one of the banks that caused the last big bust. They have nothing to worry about. They'll just get bailed out, again
Bunch of pump 'n dump scammers
Re: (Score:2)
[1]Probably should’ve bought them. [youtube.com]
[1] https://www.youtube.com/watch?v=U8nMq5c6cZM