AI’s double bubble trouble
There is a distinction between good investment and bad speculation – the likelihood is we are experiencing both.
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Some fund managers are closely tracking Bitcoin miners, which are rapidly pivoting into AI computing services.
PHOTO: PIXABAY
John Thornhill
Stock market bears are on the prowl again, growling about the dangers of a tech bubble. Ursine analysts at the International Monetary Fund, the Bank of England, Goldman Sachs, JPMorgan Chase and Citi are all warning that valuations are surging to levels not seen since the dot.com crash 25 years ago. The implicit message is that artificial intelligence is overhyped.
The reaction of bullish US West Coast tech bros has been to shrug and carry on investing, drawing a distinction between a “good” industrial investment bubble and a “bad” speculative financial bubble. But the strong likelihood is that we are experiencing both.
