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I think its a bubble but the numbers companies like nvidia are putting up right now are no lie, and from tech companies perspectives its better to invest in a p

I think its a bubble but the numbers companies like nvidia are putting up right now are no lie, and from tech companies perspectives its better to invest in a potential trend than to sit on the sidelines, which is why everyone continues to buy GPUs and launch their own AI enabled products in hopes of catching this wave. However, ML/AI has always been a cornerstone of most big tech companies, but it was usually in understated products or used in ways that might not be directly b2c or b2b like ChatGPT. For example, meta/google/netflix ad/video recommendation systems are likely mostly ML based, and have been for a few years. Most of the photography on your phone is using some form of CV/ML, Amazon probably uses ML for logistics planning, AV companies have been using ML models in perception and behvaior for years, generative models have existed for a while, etc. ChatGPT just brought the idea of AI and ML to the forefront of investors and the general public as a "tangible" and fairly practical use of "AI." So I don't think AI is necessarily a "bubble" since theres potential for pretty high utility products, but I do think the market might have an overly optimistic view on the success of AI (specifically generative AI) monetization, which only a few companies have arguably successfuly done (mostly the AI "suppliers" like nvidia, OpenAI, etc). Its yet to be seen how Chatbots/generative models will actually impact the bottom line or streamline processes at businesses without necessarily "solving" AGI. ML/AI existed before this "bubble" and will continue to exist after. In my opinion it was only a matter of time before we got here, though I'm not sure if this time if its over or under priced. I disagree with the claim that AI itself is a bubble, since it has actual utility.

VirusNewbie 3y ago
Good comment, I agree. However, I think that if it turns out LLMs don't pay for themselves or aren't a great investment for MSFT and Google and whatnot, it's not hard to pivot some of that tech to less exciting b2b type ML ventures. Maybe everyone doesn't need an LLM assistant, but every business would love it if AI can optimize their sales pipeline 5%, reduce their manufacturing defects 3%, increase their utilization 10%, etc.
- deleted 3y ago
  [deleted]
- hvxs8 3y ago
  Things are already hyper optimized in corporate wonderland. There are not enough customers with cash to milk. So to keep up appearance of growth they cultivate a subprime market propped up on credit thats never going to be paid back. So the illusions and delusions stay alive. Efficiency is always a double edged sword. The more efficient the predator or the parasite gets, the more unstable the whole system gets.
Mistletoe 3y ago
The numbers Nvidia are putting up may not be a lie but they are certainly achieved in a very odd and incestuous way such as using GPUs as collateral for loans. Worst still is companies pretending these cards won’t depreciate rapidly. The closest analog is a previous hamster wheel Nvidia was involved in with crypto mining before Ethereum switched to proof of stake and gutted the crypto video card mining industry. https://longportapp.com/en/news/100635792 https://longportapp.com/en/news/100635792 Let’s let Google’s new AI results tell us the signs of a bubble and I see all of these with the current AI grift. Rapid price increases High valuations Speculative behavior Increased media attention Lack of fundamentals Prices rise regardless of news Other asset prices are soaring, too New traders say that old investors "don't get it" Stock valuations in the top percentiles The stock market was on fumes before the current AI hype hit and we all crowded into 7 stocks. Wall Street needs this to keep the cycle going, but I don’t think it’s enough.
dagmx 3y ago
Isn’t your first paragraph essentially describing a bubble? Albeit as a tautology. NVIDIA have high revenue right now because everyone is suddenly chasing the AI bubble. There hasn’t really been a product shift on their end to cause this, rather the bubble formed coincidentally around their compute libs prevalence that’s been laying the groundwork for almost two decades . their high profit is well deserved but the sudden ramp is the bubble. When will it pop is the question? I think that’s when a lot of these smaller companies fail to produce a viable product and the bigger ones get fed up of the high margins. But I think NV will come out on top regardless, because a pop will still place them pretty high.
- MrBuddyCasino 3y ago
  Yeah. „Shovel seller makes record profit“ is not exactly a refutation of a gold rush.
  - gojomo 3y ago
    'Bubbles' and 'gold rushes' are different things.
    - MrBuddyCasino 3y ago
      Not really.
    - dagmx 3y ago
      In what sense? The gold rush precipitates the bubble.
    - d1sxeyes 3y ago
      Once everyone has a shovel, or enough people have mined enough gold, either the demand for shovels or gold will collapse. A savvy shovel seller will be aware of that, but it sounds a lot like a bubble to me.
      - gojomo 3y ago
Timber-6539 3y ago
> ML/AI existed before this "bubble" and will continue to exist after. All the more reason to assume the new run up is indeed a bubble. > actual utility What utility?
- noobermin 3y ago
  Machine learning is a broad field that arguably includes generative AI. ML has a much longer track record and has shown sustainable growth although it did also ride hype too.
  - Timber-6539 3y ago
    The current hype is all about generative AI. That's what am calling a bubble and it has very little utility in the real world if any.
    - anon22981 3y ago
      I hate the hype as much as the next guy but even I can see it’s clear as day ”gen ai” is here to stay on some form or another. Denying it is plain ignorance. Also denying it’s real world use is very ignorant as well. I have used generative ai very little yet I’ve gotten very real world use out of it. Image generation for a lecture to conceptualize something as pictures. Help in programming something fast in something unfamiliar. (Needed to use an azure sdk in java which I hadnt used before - instead of reading documentation chatgpt gave me a very usable example and I did the integration part of the work in minutes. I did check some things from docs afterwards, but the example sped the progress by a lot.) Gen ai saves too much time / money / effort on several tasks not to keep on existing. I don’t deny a possible bubble, but a bubble and real world use are not mutually exclusive in the least.
      - Timber-6539 3y ago
        Gen AI is a toy, a useful one I have to admit but it is not solving any real world problems. I use it sometimes, the product is just not production-quality ready. Chatbots are not what's going to make AI great. Am sure there's some commercial utility out there for AI to improve efficiency in certain specific industries, that's what am more interested in hearing about instead.
otabdeveloper4 3y ago
"ML" and "AI" are polar opposites as far as business is concerned. (ML is interpretable and testable models with clear KPI indicators, AI is "let's value-add to public domain data and upsell the result".)
- noobermin 3y ago
  That's one hell of a description. Some would also say "add to others' IP whose ownership has been laundered." That would seem more profitable as long as it's legal.
JohnFen 3y ago
> So I don't think AI is necessarily a "bubble" since theres potential for pretty high utility products A market being a bubble does not imply that there is no utility for the products in that market. > but I do think the market might have an overly optimistic view on the success of AI This is exactly the definition of a "bubble".
- ewzimm 3y ago
  This is all accurate. The comment in this article is specifically about the top 10 AI companies, so the usual big tech stocks. I'm no expert, but I can understand how a stock gaining $277 billion in a single day can be concerning from an investment perspective. But it's hard to argue with the results of the progress in AI over the last few years. I have no idea how that will translate for investors, but I wouldn't be surprised if AI fundamentally changes the stock market into something fully automatic within the next decade. If it's reliably better at trading than people, then whoever has the most hardware is going to be able to make the best predictions, allowing them to buy more hardware and make better predictions. In 10 years, what's the purpose of a human trader?
  - boshalfoshal 3y ago
    Your first point about AI changing markets was interesting until you put it in the context of automated trading, thats too small scale and kind of missing a bigger and more existential point. The long tail of AGI is that markets themselves are meaningless, and I say this as someone who worked at an HFT firm in the past. Automated trading already exists, but automated trading firms value explainability and reproducibility. Most common models in the quant trading space are linear regressions - they are simple and explainable. If you made an AI trade, it better be explainable, but explainable AI seems pretty far away at this point and it doesn't seem like something many companies care about right now. And despite all the automation in the trading space, there are still traders. Humans are decent at analyzing idiocyncratic events (0-shot learning), but machines are not (yet).
    - ewzimm 3y ago
iancmceachern 3y ago
But nvidia isn't an AI company. They're selling shovels to the miners. They're a shovel (chip and software) company. My litmus test has been companies that call it machine learning are less hype'y and likely more real. Companies slapping AI onto anything and everything are more likely to be.
- fennecbutt 3y ago
  Are they not? https://www.nvidia.com/en-gb/geforce/news/nvidia-ace-for-games-generative-ai-npcs/ https://www.nvidia.com/en-gb/geforce/news/nvidia-ace-for-gam... https://www.nvidia.com/en-gb/research/ai-playground/ https://www.nvidia.com/en-gb/research/ai-playground/ And features for games like AI upscaling. It's all to sell Nvidia hardware in the end of course.
  - iancmceachern 3y ago
    What percentage of their revenue comes from those? I think your last sentence says it all. Elon Musk isn't a flamethrower salesman. These are flamethrowers.
zamalek 3y ago
> numbers companies like nvidia are putting up right now are no lie Dotcom s/stock/GPU/g. Although I do think NVIDIA will come out of this one unscathed.

VirusNewbie 3y ago

Good comment, I agree. However, I think that if it turns out LLMs don't pay for themselves or aren't a great investment for MSFT and Google and whatnot, it's not hard to pivot some of that tech to less exciting b2b type ML ventures. Maybe everyone doesn't need an LLM assistant, but every business would love it if AI can optimize their sales pipeline 5%, reduce their manufacturing defects 3%, increase their utilization 10%, etc.

deleted 3y ago
[deleted]
hvxs8 3y ago
Things are already hyper optimized in corporate wonderland. There are not enough customers with cash to milk. So to keep up appearance of growth they cultivate a subprime market propped up on credit thats never going to be paid back. So the illusions and delusions stay alive. Efficiency is always a double edged sword. The more efficient the predator or the parasite gets, the more unstable the whole system gets.

Mistletoe 3y ago

The numbers Nvidia are putting up may not be a lie but they are certainly achieved in a very odd and incestuous way such as using GPUs as collateral for loans. Worst still is companies pretending these cards won’t depreciate rapidly. The closest analog is a previous hamster wheel Nvidia was involved in with crypto mining before Ethereum switched to proof of stake and gutted the crypto video card mining industry. https://longportapp.com/en/news/100635792 https://longportapp.com/en/news/100635792 Let’s let Google’s new AI results tell us the signs of a bubble and I see all of these with the current AI grift. Rapid price increases High valuations Speculative behavior Increased media attention Lack of fundamentals Prices rise regardless of news Other asset prices are soaring, too New traders say that old investors "don't get it" Stock valuations in the top percentiles The stock market was on fumes before the current AI hype hit and we all crowded into 7 stocks. Wall Street needs this to keep the cycle going, but I don’t think it’s enough.

dagmx 3y ago

Isn’t your first paragraph essentially describing a bubble? Albeit as a tautology. NVIDIA have high revenue right now because everyone is suddenly chasing the AI bubble. There hasn’t really been a product shift on their end to cause this, rather the bubble formed coincidentally around their compute libs prevalence that’s been laying the groundwork for almost two decades . their high profit is well deserved but the sudden ramp is the bubble. When will it pop is the question? I think that’s when a lot of these smaller companies fail to produce a viable product and the bigger ones get fed up of the high margins. But I think NV will come out on top regardless, because a pop will still place them pretty high.

MrBuddyCasino 3y ago
Yeah. „Shovel seller makes record profit“ is not exactly a refutation of a gold rush.
- gojomo 3y ago
  'Bubbles' and 'gold rushes' are different things.
  - MrBuddyCasino 3y ago
    Not really.
  - dagmx 3y ago
    In what sense? The gold rush precipitates the bubble.
  - d1sxeyes 3y ago
    Once everyone has a shovel, or enough people have mined enough gold, either the demand for shovels or gold will collapse. A savvy shovel seller will be aware of that, but it sounds a lot like a bubble to me.
    - gojomo 3y ago

Timber-6539 3y ago

> ML/AI existed before this "bubble" and will continue to exist after. All the more reason to assume the new run up is indeed a bubble. > actual utility What utility?

noobermin 3y ago
Machine learning is a broad field that arguably includes generative AI. ML has a much longer track record and has shown sustainable growth although it did also ride hype too.
- Timber-6539 3y ago
  The current hype is all about generative AI. That's what am calling a bubble and it has very little utility in the real world if any.
  - anon22981 3y ago
    I hate the hype as much as the next guy but even I can see it’s clear as day ”gen ai” is here to stay on some form or another. Denying it is plain ignorance. Also denying it’s real world use is very ignorant as well. I have used generative ai very little yet I’ve gotten very real world use out of it. Image generation for a lecture to conceptualize something as pictures. Help in programming something fast in something unfamiliar. (Needed to use an azure sdk in java which I hadnt used before - instead of reading documentation chatgpt gave me a very usable example and I did the integration part of the work in minutes. I did check some things from docs afterwards, but the example sped the progress by a lot.) Gen ai saves too much time / money / effort on several tasks not to keep on existing. I don’t deny a possible bubble, but a bubble and real world use are not mutually exclusive in the least.
    - Timber-6539 3y ago
      Gen AI is a toy, a useful one I have to admit but it is not solving any real world problems. I use it sometimes, the product is just not production-quality ready. Chatbots are not what's going to make AI great. Am sure there's some commercial utility out there for AI to improve efficiency in certain specific industries, that's what am more interested in hearing about instead.

otabdeveloper4 3y ago

"ML" and "AI" are polar opposites as far as business is concerned. (ML is interpretable and testable models with clear KPI indicators, AI is "let's value-add to public domain data and upsell the result".)

noobermin 3y ago
That's one hell of a description. Some would also say "add to others' IP whose ownership has been laundered." That would seem more profitable as long as it's legal.

JohnFen 3y ago

> So I don't think AI is necessarily a "bubble" since theres potential for pretty high utility products A market being a bubble does not imply that there is no utility for the products in that market. > but I do think the market might have an overly optimistic view on the success of AI This is exactly the definition of a "bubble".

ewzimm 3y ago
This is all accurate. The comment in this article is specifically about the top 10 AI companies, so the usual big tech stocks. I'm no expert, but I can understand how a stock gaining $277 billion in a single day can be concerning from an investment perspective. But it's hard to argue with the results of the progress in AI over the last few years. I have no idea how that will translate for investors, but I wouldn't be surprised if AI fundamentally changes the stock market into something fully automatic within the next decade. If it's reliably better at trading than people, then whoever has the most hardware is going to be able to make the best predictions, allowing them to buy more hardware and make better predictions. In 10 years, what's the purpose of a human trader?
- boshalfoshal 3y ago
  Your first point about AI changing markets was interesting until you put it in the context of automated trading, thats too small scale and kind of missing a bigger and more existential point. The long tail of AGI is that markets themselves are meaningless, and I say this as someone who worked at an HFT firm in the past. Automated trading already exists, but automated trading firms value explainability and reproducibility. Most common models in the quant trading space are linear regressions - they are simple and explainable. If you made an AI trade, it better be explainable, but explainable AI seems pretty far away at this point and it doesn't seem like something many companies care about right now. And despite all the automation in the trading space, there are still traders. Humans are decent at analyzing idiocyncratic events (0-shot learning), but machines are not (yet).
  - ewzimm 3y ago

iancmceachern 3y ago

But nvidia isn't an AI company. They're selling shovels to the miners. They're a shovel (chip and software) company. My litmus test has been companies that call it machine learning are less hype'y and likely more real. Companies slapping AI onto anything and everything are more likely to be.

fennecbutt 3y ago
Are they not? https://www.nvidia.com/en-gb/geforce/news/nvidia-ace-for-games-generative-ai-npcs/ https://www.nvidia.com/en-gb/geforce/news/nvidia-ace-for-gam... https://www.nvidia.com/en-gb/research/ai-playground/ https://www.nvidia.com/en-gb/research/ai-playground/ And features for games like AI upscaling. It's all to sell Nvidia hardware in the end of course.
- iancmceachern 3y ago
  What percentage of their revenue comes from those? I think your last sentence says it all. Elon Musk isn't a flamethrower salesman. These are flamethrowers.

zamalek 3y ago

> numbers companies like nvidia are putting up right now are no lie Dotcom s/stock/GPU/g. Although I do think NVIDIA will come out of this one unscathed.