Locator: 50674BUBBLE.
By the way, before we get started:
There's a great documentary on Peggy Guggenheim on YouTube -- I became interested in her story after reading about the Guggenheims in Malcolm Harris' book on Palo Alto -- she ultimately became, if not the richest -- practically the richest women in the world -- and she did it on her own pretty much without the Guggenheim money.Puts a lot of our anxiety into perspective.
In another side-bar discussion with a reader, not ready for prime time.
The reader asked about "the AI bubble," on a day CAT explodes to the upside by 10%, gaining $80 /share because of the work it is doing for LDCs.
My reply, again not ready for prime time.
With regard to the AI bubble setting us up for a crash, I asked the same question to Grok, ChatGPT, and Gemini.
The question (to each of the three chatbots):
This is just a throwaway query. I'm not concerned. Doesn't affect my life at all, investing or otherwise. I'm just curious how you see it.The replies:Looking back, there was a lot of talk comparing the crash of 1929 with the 2000 dot-com crash, but in the big scheme of things, the dot-com crash was nowhere near the crash of 1929. Now, we're talking about the AI bubble that will echo the 1929 crash. At the same point in the 2020 dot-com euphoria as we have now, were things, looking back, more problematic in 2020 or are they more problematic now?
Grok couldn't provide an answer because it was under "heavy demand" and I don't pay for a subscription (which, by the way, speaks volumes). [I don't pay for any chatbot.]Gemini agreed with you: we are setting ourselves up for a crash.ChatGPT: not even close to a crash. Structurally things are so much different than either the 2000 dot-com bust or the 1929 crash.ChatGPT gave a much better explanation -- won't go into details.But I'm not a bit worried.The fact that Grok couldn't even answer because it didn't have enough "compute" -- as they call it -- tells me there is so much demand for AI -- I mean seriously -- Elon Musk doesn't have enough "compute" -- because too much demand. Give me a break!
And in market share, I think Grok is about 1% with ChatGPT and Gemini sharing 90% combined.I'm still reading the history of Stanford University / Palo Alto / Silicon Valley by Malcolm Harris and the military relationship with AI is so incredible -- it cannot be overstated. The Black Swan, if there is one, will be a shortage of rare earths or a shortage of fabs (in this case, storage, first -- MU -- and then CPUs (TSM -- 90%?).The focus of Xi - Trump's visit this summer is going to be Taiwan.So, unless there's a Black Swan, something we didn't see coming, like a) an asteroid hitting Wall Street; b) a shortage of rare earths which really wouldn't be a Black Swan because we've known about this issue for years; and/or, c) China moving aggressively on Taiwan, which I don't see happening.
China needs Taiwan's fabs and technology as much as we do. The worst that will happen will be a velvet glove takeover of Taiwan by China. That's how it will start: if Taiwan tries to fight it and US / Japan go to nukes to stop China, then all bets are off.But again, I was amazed. Grok -- denial of service -- because it was too busy or simply doesn't want to help me because I'm not a paying subscriber. That speaks volumes where we are with regard to how many Nvidia blades Elon Musk still needs to buy from Huang Jensen.
