Yes, Generative AI is revolutionary, although AI has been around for decades. But mankind -- and even U.S. stock markets -- have gone thru many revolutionary products, from the automobile (from 1900-1919, some 2000 companies were involved in auto production -- most disappeared,) to the computer, etc. Remember Iomega and the zip drive ? https://www.howtogeek.com/658287/even-25-years-later-the-iomega-zip-is-unforgettable/ But closer conceptually to NVDA, is the history of CSCO: Cisco's boom and bust: https://www.thestreet.com/technology/ciscos-boom-and-bust-a-history-lesson-11212172 Cisco Stock History: What Investors Need to Know https://www.fool.com/investing/2016/09/23/cisco-stock-history-what-investors-need-to-know.aspx REMINISCENCES OF A STOCK OPERATOR by Edwin LeFevre IMO, still the best book on trading, and mostly a "bible," for every billionaire trader. Free download: https://www.trendfollowing.com/whitepaper/Edwin_LeFevre_Reminiscences_of_a_Stock_Operator.pdf Another lesson I learned early is that there is nothing new in Wall Street. There can't be because speculation is as old as the hills. Whatever happens in the stock market to-day has happened before and will happen again.
I don’t think generative AI is revolutionary. I think it’s glorified autocomplete which has no economic purpose beyond a few niche applications and low-value tasks. Certainly nothing to justify the vast investments being undertaken.
NVDA is a semi conductor stock and like they always do during boom cycles is bust. They always do. I think we are almost witnessing a climactic rise in the semi's and some of the other AI related stocks. This usually marks the end but who knows, these explosive upside moves can last a while. We will know by the price action with support levels being taken out.
Cisco was selling expensive optical Gigabit switches which in retrospect were just glorified Hubs that Cisco & 3Com sold. nVidia's tech is a lot more complex & more difficult to duplicate. That is the main difference. I mean AMD's Radeon division still hasn't caught up with the RTX graphics cards that nVidia has been selling since the 2XXX generation. The 4XXX generation has already widened the lead against Radeon. The RTX 4090 is 30% faster than the Radeon 7900 XTX cards. Radeon catching nVidia is unlikely.
......... some history. That really matters:- NVIDIA went public on January 22, 1999 at $12/share Splits 06/27/2000 2/1 09/17/2001 2/1 04/07/2006 2/1 09/11/2007 3/2 07/20/2021 4/1 06/10/2024 10/1 or 480/1 24 years later. Current price $130.57 CSCO <> NVDA.
It’s not really about the tech in this case; it’s about whether the hyperscalers are going to be ordering billions and billions of dollars of chips, quarter after quarter after quarter, into the infinite future. My personal opinion is that nobody wants all this “AI” LLM crap (just look at the reaction to msft’s “recall” and the aapl announcement) and consumers and businesses are definitely not willing to pay anything for it. It will turn out that there’s nothing for those AI chips to do which can justify their cost of production & operation, new orders will dry up and NVDAs operating leverage will go into reverse. I don’t have the faintest idea as to timing, though.
Suppose, hypothetically, LLM's can make all white collar jobs with iq<100 obsolete Questions one can ask are: - What are al those people going to do, from a societal point of view. Recall that governments need people to 'work' ( welfare was created by the rich in the middle ages who didn't like all the poor on the streets ) - Aren't many of those jobs already obsolete? (with all due respect for those people, but the amount of inefficient jobs is staggaring)