Anonymous wrote:The .com crash was very painful because the valuations were so high (many multiples of revenue) and few .com companies were making money. The big AI companies are very profitable and that makes a huge difference. Regardless, a burst bubble will be painful.

WHAT

https://www.cnbc.com/2025/08/08/chatgpt-gpt-5-openai-altman-loss.html


"OpenAI was expecting about $5 billion in losses on $3.7 billion in revenue."

The .com crash was very painful because the valuations were so high (many multiples of revenue) and few .com companies were making money. The big AI companies are very profitable and that makes a huge difference. Regardless, a burst bubble will be painful.

What is scary is that something like 30-40% of the S&P value is in seven stocks going all in on AI. With so many people invested in S&P index funds a bubble burst will be very painful even if you don’t invest directly in AI. I’m doing some rebalancing into bonds and alternative investments just to provide a cushion. One strategy we have is to have enough in cash-like accounts to cover a few years of expenses so we can ride out a downswing.

Anonymous wrote:AI is here to stay. That's not to say every IA-related company will prosper, but some will while others fail or are absorbed by more successful competitors. Not different than companies in other sectors, really.

I dont think anyone is doubting that AI is here to stay, its the fact that there is a vicious cycle right now of AI companies all investing in each other so that they can go out and consume more of each other's services and products. It’s a self inflating balloon.

How is that not problematic? If only one of them catches a cold or hiccups, the entire self ballooning ecosystem massively driving up equity values crashes and it takes down the whole economy. It's an infinite money glitch until it isn't.

Greed is good. I know everyone loves money. But we Americans are quite unique to be honest lol

Anonymous wrote:Very eye opening and good article I read recently:


https://finance.yahoo.com/news/very-troubling-ais-self-investment-spree-sets-off-bubble-alarms-on-wall-street-160524518.html


What could possibly go wrong with AI companies pouring money into chip and cloud companies who then invest in AI companies who buy up their chips and services? What an innovative infinite money glitch, right?

silly valley has been using the same infinite money glitch for literally decades. VC will instruct one company in its portfolio to buy (possibly fictional) services from another holding, who will then buy something else from another portfolio company, who will buy something from or invest in the first company. magically $1 becomes $4. that's just a tuesday.

Anonymous wrote:AI is here to stay. That's not to say every IA-related company will prosper, but some will while others fail or are absorbed by more successful competitors. Not different than companies in other sectors, really.

Wrong money laundering and pump and dump schemes

Anonymous wrote:Absolutely. Even my friends and colleagues who work for OpenAI and the other AI labs are racing to unload as much of their equity as they can, because they think it's all going to collapse soon.

Well that's interesting. Any more detail you can offer?

Anonymous wrote:

Anonymous wrote:AI is here to stay. That's not to say every IA-related company will prosper, but some will while others fail or are absorbed by more successful competitors. Not different than companies in other sectors, really.

"AI is here to stay." and AI bubble is not mutually exclusive. During the Dot Com bubble, the Internet in its many forms stayed but lots of Dot Com companies went under.

Yeah, if you have a product like this, it's clearly worth running hundreds of data centers gobbling up energy like cities. Gotta keep it going so we can get more amazing outputs.

https://bsky.app/profile/lukeplunkett.com/post/3m37qrtboik22

The AI bubble is probably the only thing keeping the economy afloat, so yes, it will be worse.

AI is here to stay, but it is underperforming across the board. It has definitely reached its limit for now. The data centers needed to generate those stupid Barbie doll memes are also causing energy prices to skyrocket when people are already stretched beyond thin.

Next few years are going to be seriously ugly.

Anonymous wrote:AI is here to stay. That's not to say every IA-related company will prosper, but some will while others fail or are absorbed by more successful competitors. Not different than companies in other sectors, really.

"AI is here to stay." and AI bubble is not mutually exclusive. During the Dot Com bubble, the Internet in its many forms stayed but lots of Dot Com companies went under.

AI is here to stay. That's not to say every IA-related company will prosper, but some will while others fail or are absorbed by more successful competitors. Not different than companies in other sectors, really.

Everything is a bubble of sorts. Always a boom and bust.

Absolutely. Even my friends and colleagues who work for OpenAI and the other AI labs are racing to unload as much of their equity as they can, because they think it's all going to collapse soon.

Very eye opening and good article I read recently:


https://finance.yahoo.com/news/very-troubling-ais-self-investment-spree-sets-off-bubble-alarms-on-wall-street-160524518.html


What could possibly go wrong with AI companies pouring money into chip and cloud companies who then invest in AI companies who buy up their chips and services? What an innovative infinite money glitch, right?