The AI Stock Market Crash That No One Saw Coming

AI stocks have gone up in a straight line in 2023 and 2024 and it's all beginning to look suspiciously like a bubble.

A small number of stocks are going up hundreds of percent in a matter of weeks or months while the rest of the stock market is going nowhere.

Are we about to see a big stock market crash or is this time going to be different?

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[jerrycampbell-utyf]

Obviously AI stocks will dominate 2024. Why I prefer NVIDIA is that they are better placed to maintain long term growth potential, and provide a platform for other AI companies. I know someone who has made more than 200% from NVIDIA. I'll also take these other recommendations you made.

[Cscrimpshire]

AI Stocks are pretty unstable at the moment, but if you do the right math, you should be just fine. Bloomberg and other finance media have been recording cases of folks gaining over 250k just in a matter of weeks/couple months, so I think there are a lot of wealth transfer in this downtime if you know where to look.

[colixo]

A good rule of thumb I've heard for world changing technology or developments is that people tend to significantly over estimate their impact in the short term and significantly under estimate their impact in the long term

[stevehensonuk]

Damn....I was lucky enough to work in that sector (Nortel) between 1999 and 2003. During the spring/summer of 2000 colleagues were taking out bank loans to buy stock in Nortel, Lucent, Cisco and Alcatel. It really did not end well. Like you say things sure do look similar!

[lesdickson]

A crash? If NVIDIA post record earnings again (which I feel like they will), the AI bubble may continue blowing up. If they miss, then maybe a ‘crash’ will happen but its earnings miss will have ripple effects across the tech sector.

Also, Sora is going to be as disruptive as ChatGPT in regards to anything related to video — the movie (and wider entertainment) industry could be upended.

Edit: NVIDIA beat on earnings (which I hoped for).

[cvrart]

Yep, this is pretty much exactly the way I see the current situation. Well elucidated.

[tekboi]

It's crazy that I totally called it but never knew it would have this effect. 2-3 years ago when all the graphics cards were being used to create bitcoin/eth mining farms. I heard that some mining farms in North Dakota were running on electricity from generators. Those generators were
burning natural gas from the land that the server was built on. I went on a whole rant that we were knowingly or unknowingly setting up the infrastructure for AI to run without humans. I think I was mainly pissed off that I couldn't find a video card for my gaming pc though lol:

[timblagdon]

I bought to NVDIA months ago after hearing about it here so thanks Sasha!

[davidcunningham]

good to see someone seriously thinking this through.

[StrangerOnTheWeb]

Personally a dip before earnings is a good sign, I believe if the report is good tomorrow then the pump will resume

[AdrianTap]

As always. Cold&Crisp with data. Eye opening video.

[HsetimS]

I enjoy Sasha's videos and like all of us, he has strengths and weaknesses. His strength is putting together valuations/fundamental analysis, and analysis of financial statements and economic data. Unfortunately, he doesn't believe in technical analysis which I've found is also an important part of stock picking. There's very few times when we get Nvidia-type events (Tesla being another) and if you're not looking at indicators of momentum, and only looking at DCF and the like, you'll be sitting on the sidelines whilst other get their 150%+ returns. Yes, we know it could crash at any time which is why it's important to keep a close eye on things to determine when to sell. That's not a reason to avoid getting in.

[Pwpio]

And then when stock is over heated already, big banks like JPM or Gold issue a price target just above a current price a few weeks before earnings so investors go full berserk mode and starting loading more of over priced stock, create enormous liquidity that bank uses to exit their positions. And then comes the correction...

[Loundsify]

The AI bubble is insane. When it goes it's gonna drag a lot of shit down.

[Neil_KnowsNoKungFu]

Agree with the point that msft ect wont be buying cards constantly and at some point there will be a reality check. But for the cisco/nvda comparison is this really 2000? i think its 95 or 96. They havvent even cut rates yet. There will be bumps, maybe even crashes, but this is just the start.

[Del_]

I think there's one more leg up. Big ouchie coming in late-March to mid-June. I am mostly pulling this out of my ass but it's as good as any analyst.

[bigtalljosh]

I think nvidia have massive headroom yet. Autonomous vehicles, home AI, game consoles, mobile AI, IoT AI, farming equipment, war, space exploration…

[dxd]

This bubble will burst ...
1 - IA needs huge investment, what company will invest in new tech, in a moment of high interest hates?
2 - IA is not so simply to implement, you need to train IA for months to really begin to get some results, yet companies cannot trust 100% in the results from IA.
3 - Generative IA is a nich, it will take years to fully integrate our lives. Let's be sincere, do you like to talk with a human attendant or IA?
4 - IA chips are not so complicated, AMD and Intel have parallel processing chips too. Nvidia value comes from the CUDA architecture... But, I bet we'll have open source models and architecture in the future... And, as we have Linux shining in the servers and data centers, these open source models will bite Nvidia market.

[Yoyoy]

The crash usually comes when the real hype at the top..thats how they get you

[miri]

NVDA and AMD are most likely heavily overvalued, but MSFT, AMZN...etc not that much and will benefit the most in long term.