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That's more than the GDP of Argentine in a change that has happened in less than two months. It's crazy how we see such speculation as a normal process and I wo

by lp4vn 3y ago

That's more than the GDP of Argentine in a change that has happened in less than two months. It's crazy how we see such speculation as a normal process and I wonder if that's really a good thing.

brianwawok 3y ago
I’ve surly benefit from both the month and the products of VC and speculation.
bko 3y ago
It might be over bought, but what you call speculation is a good signal to the company and others. People are seeing the potential and importance of what Nvidia is doing so this attracts more investment and competition. It'll take a lot for a competitor to come in so the prize better be very large
moose_man 3y ago
This is just the latest example of what has been happening since GameStop. It's a sign that institutional investors took the concept and have been applying it to different stock every few months since then, DWAC, UPST ect. It's not real, it shows the market has been totally gamed.
- iLoveOncall 3y ago
  GME's price rose to insane values because there wasn't enough shares in the market to satisfy all the short calls. This has nothing to do with NVIDIA's situation.
  - moose_man 3y ago
    But what if you could achieve the same effect with a bunch of institutional money rushing in over a short period of time? The the first time it happened it might have been an accident, but as a regular occurrence its a sign of manipulation.
    - metadat 3y ago
      Please stop posting minor variations of the same message over and over on this story (6+ repetitive comments). Repeating something more times doesn't make it more true, and isn't evidence of veracity. This behavior degrades the quality of the discussion and is at odds with the HN site guidelines of fostering curiosity. If you have real data, reference that instead. It'd actually be useful.
- willis936 3y ago
  At least with gamestop there was a large short position being called. Granted I know that was just the catalyst for meme stocks. I'd be surprised to learn anyone has a large Nvidia short position. It's not absurd since it speculates on when the AI bubble will pop. I suppose that's really up to the fed.
  - moose_man 3y ago
    I think you could probably create the same sort of hyperbolic moves if you rushed in a bunch of institutional money over a short period. Maybe the first time they discovered they could have this effect it was accident, not as a regular feature of the market.
- theginger 3y ago
  It does have a definite whiff of a meme stock to it now. There were real things pushing it up, plus the sort of genuine hype you expect with big tech. But now everyone is talking about it it takes on a a life of its own, it's hype on top of hype and to a certain degree everyone knows it so now its just gambling on who can get out before it turns.
  - moose_man 3y ago
    There is an aspect of this where it is natural, but given this happens every few months and the companies that it happens to don't really cohere or make sense makes to have valuations anywhere near what they achieve it seems like there is an artificial aspect to it to say the least.
- lm28469 3y ago
  > It's not real, it shows the market has been totally gamed. It's really crazy how things are moving since the end of lockdowns, more or less everybody agrees the economy is in a bad spot, layoffs, inflation, recession risks, fertility issues, climate change issues, energy issues, wars, people can't afford housing, the end of "cheap" money, &c. Meanwhile my stocks pumped 50% over 6 months for seemingly no reasons, more than half of my gains happened in the last year idk what's cooking but I'm starting to smell smoke
  - moose_man 3y ago
    I think it's not just the amount of inflow into a stock its the herding behavior and the speed that sets up these crazy unnatural movements. Most of these stocks are come back to Earth relatively quickly so they all leave at the same time too.
    - lm28469 3y ago
      I wonder how much is due to the average joe getting into trading since it's becoming easier and easier to invest money and as it is it looks like free money.
      - moose_man 3y ago
        It is retail investors, but to create the momentum that drives the frenzy you need a lot of cash rushing in at the same time. Like with GameStop it was all over the news, there just isn't the same level of media hype to cause the run up. I bet what tips it into a feeding frenzy is a massive institutional investor inflow which creates enough of an outsized move to then attract guppy retail investors who end up driving the craziness and holding the bag. It's part natural behavior, part manipulation.
- voisin 3y ago
  It has been happening since well before GameStop. Think Dutch Tulip Mania, and literally thousands of examples since then. If anything the madness of crowds appears to be a regular occurrence in the market (or perhaps wherever money is involved and limited goods, like this recent Stanley Cup craziness, or Beanie Babies of yesteryear)
1980phipsi 3y ago
That’s comparing stocks to flows. Argentina’s GDP measures income not wealth.
- gizmo 3y ago
  The comparison is fine. It's a comparison between the labor of a country of 45 million people working for a full year vs the value created by a company with 25 thousand employees working for a few months. It's not a perfect analogy (what analogy is?) but it is the kind of thing that should make you go "hmm".
  - jsnell 3y ago
    It's pretty obvious that Nvidia didn't create $500 billion in value in a few months. Either the vast majority of that value was created over the last decade or so, and is now being harvested with a delay, or it's a speculative bubble rather than value creation.
- DanielHB 3y ago
  I don't get why people keep measuring companies valuations against countries GDP, GDP is per year, valuation is total value. Meaning those are completely unrelated metrics. What makes more sense is to compare the company revenues or profits against a country GDP.
  - gizmo 3y ago
    Absolutely not. For a country most labor doesn't compound in value. When a farmer produces wheat the value created is equal to the value of the wheat. When a barber cuts somebodies hair the value created is again more or less equal to the price charged. A barber shop doesn't make anything that accumulates in value. This is true for most the economy. It trades at about 1x revenue. Tech is different. Write software once, sell it many times. Design a chip once, sell millions of copies. Tech companies are the outliers. The rest of the world doesn't work like this.
    - 3y ago
gizmo 3y ago
Every hedge fund and every pension fund in the world wants some exposure to AI, as it is widely believed to be the next big thing. What happens when everybody is buying NVIDIA and Super Micro? Right. Instead of thinking in terms of speculation think in terms of money flows. A lot of money flowing into a handful of stocks results in an explosive move up. There is plenty of speculation as well, of course, but that isn't why AI stocks are up. When will NVDA and SMCI go down? When all the big funds become sellers. But what else can they buy? INTC and AMD don't have competitive chips or software.

by lp4vn 3y ago

That's more than the GDP of Argentine in a change that has happened in less than two months. It's crazy how we see such speculation as a normal process and I wonder if that's really a good thing.

brianwawok 3y ago

I’ve surly benefit from both the month and the products of VC and speculation.

bko 3y ago

It might be over bought, but what you call speculation is a good signal to the company and others. People are seeing the potential and importance of what Nvidia is doing so this attracts more investment and competition. It'll take a lot for a competitor to come in so the prize better be very large

moose_man 3y ago

This is just the latest example of what has been happening since GameStop. It's a sign that institutional investors took the concept and have been applying it to different stock every few months since then, DWAC, UPST ect. It's not real, it shows the market has been totally gamed.

iLoveOncall 3y ago
GME's price rose to insane values because there wasn't enough shares in the market to satisfy all the short calls. This has nothing to do with NVIDIA's situation.
- moose_man 3y ago
  But what if you could achieve the same effect with a bunch of institutional money rushing in over a short period of time? The the first time it happened it might have been an accident, but as a regular occurrence its a sign of manipulation.
  - metadat 3y ago
    Please stop posting minor variations of the same message over and over on this story (6+ repetitive comments). Repeating something more times doesn't make it more true, and isn't evidence of veracity. This behavior degrades the quality of the discussion and is at odds with the HN site guidelines of fostering curiosity. If you have real data, reference that instead. It'd actually be useful.
willis936 3y ago
At least with gamestop there was a large short position being called. Granted I know that was just the catalyst for meme stocks. I'd be surprised to learn anyone has a large Nvidia short position. It's not absurd since it speculates on when the AI bubble will pop. I suppose that's really up to the fed.
- moose_man 3y ago
  I think you could probably create the same sort of hyperbolic moves if you rushed in a bunch of institutional money over a short period. Maybe the first time they discovered they could have this effect it was accident, not as a regular feature of the market.
theginger 3y ago
It does have a definite whiff of a meme stock to it now. There were real things pushing it up, plus the sort of genuine hype you expect with big tech. But now everyone is talking about it it takes on a a life of its own, it's hype on top of hype and to a certain degree everyone knows it so now its just gambling on who can get out before it turns.
- moose_man 3y ago
  There is an aspect of this where it is natural, but given this happens every few months and the companies that it happens to don't really cohere or make sense makes to have valuations anywhere near what they achieve it seems like there is an artificial aspect to it to say the least.
lm28469 3y ago
> It's not real, it shows the market has been totally gamed. It's really crazy how things are moving since the end of lockdowns, more or less everybody agrees the economy is in a bad spot, layoffs, inflation, recession risks, fertility issues, climate change issues, energy issues, wars, people can't afford housing, the end of "cheap" money, &c. Meanwhile my stocks pumped 50% over 6 months for seemingly no reasons, more than half of my gains happened in the last year idk what's cooking but I'm starting to smell smoke
- moose_man 3y ago
  I think it's not just the amount of inflow into a stock its the herding behavior and the speed that sets up these crazy unnatural movements. Most of these stocks are come back to Earth relatively quickly so they all leave at the same time too.
  - lm28469 3y ago
    I wonder how much is due to the average joe getting into trading since it's becoming easier and easier to invest money and as it is it looks like free money.
    - moose_man 3y ago
      It is retail investors, but to create the momentum that drives the frenzy you need a lot of cash rushing in at the same time. Like with GameStop it was all over the news, there just isn't the same level of media hype to cause the run up. I bet what tips it into a feeding frenzy is a massive institutional investor inflow which creates enough of an outsized move to then attract guppy retail investors who end up driving the craziness and holding the bag. It's part natural behavior, part manipulation.
voisin 3y ago
It has been happening since well before GameStop. Think Dutch Tulip Mania, and literally thousands of examples since then. If anything the madness of crowds appears to be a regular occurrence in the market (or perhaps wherever money is involved and limited goods, like this recent Stanley Cup craziness, or Beanie Babies of yesteryear)

1980phipsi 3y ago

That’s comparing stocks to flows. Argentina’s GDP measures income not wealth.

gizmo 3y ago
The comparison is fine. It's a comparison between the labor of a country of 45 million people working for a full year vs the value created by a company with 25 thousand employees working for a few months. It's not a perfect analogy (what analogy is?) but it is the kind of thing that should make you go "hmm".
- jsnell 3y ago
  It's pretty obvious that Nvidia didn't create $500 billion in value in a few months. Either the vast majority of that value was created over the last decade or so, and is now being harvested with a delay, or it's a speculative bubble rather than value creation.
DanielHB 3y ago
I don't get why people keep measuring companies valuations against countries GDP, GDP is per year, valuation is total value. Meaning those are completely unrelated metrics. What makes more sense is to compare the company revenues or profits against a country GDP.
- gizmo 3y ago
  Absolutely not. For a country most labor doesn't compound in value. When a farmer produces wheat the value created is equal to the value of the wheat. When a barber cuts somebodies hair the value created is again more or less equal to the price charged. A barber shop doesn't make anything that accumulates in value. This is true for most the economy. It trades at about 1x revenue. Tech is different. Write software once, sell it many times. Design a chip once, sell millions of copies. Tech companies are the outliers. The rest of the world doesn't work like this.
  - 3y ago

gizmo 3y ago

Every hedge fund and every pension fund in the world wants some exposure to AI, as it is widely believed to be the next big thing. What happens when everybody is buying NVIDIA and Super Micro? Right. Instead of thinking in terms of speculation think in terms of money flows. A lot of money flowing into a handful of stocks results in an explosive move up. There is plenty of speculation as well, of course, but that isn't why AI stocks are up. When will NVDA and SMCI go down? When all the big funds become sellers. But what else can they buy? INTC and AMD don't have competitive chips or software.