Too big to fAIl

But everyone hates CA, hates big tech, etc, etc, so maybe the political stars align and this will be the ones who finally set the "no bailout" precedent.

[1] Well actually I can now that I think about it and it's the beltway bandits but that's beside the point.

Edit: People are literally being forced out of the country by cost of living https://www.wsj.com/personal-finance/retirement/middle-class...

While acknowledging being in a bubble the quote was "While the music is playing, you have to get up and dance".

His explanation of the quote:

'"My belief then and my belief now is that one firm in this business cannot unilaterally withdraw from the business and maintain its ability to conduct business in the future,” Mr. Prince said."'

...

'"And if you are not engaged in business, people leave the institution, so it is impossible to say in my view to your bankers we are just not going to participate in the business in the next year or so until things become a little more rational," he said. "You can’t do that and expect to have any people left to conduct business in the future."'

-- https://archive.nytimes.com/dealbook.nytimes.com/2010/04/08/...

To me it looks like history proved him right. The largest institutions were the ones that got bailed out.

Everyone wants to know, so it's always news. Even though it usually isn't.

But still, the actual stock market behavior right now is PROBABLY (!!) more reflective of random motion than it is of a fundamental shift in investor behavior.

Unless it isn't.

By 1998, Yahoo was the beneficiary of a de facto Ponzi scheme. Investors were excited about the Internet. One reason they were excited was Yahoo's revenue growth. So they invested in new Internet startups. The startups then used the money to buy ads on Yahoo to get traffic. Which caused yet more revenue growth for Yahoo, and further convinced investors the Internet was worth investing in. When I realized this one day, sitting in my cubicle, I jumped up like Archimedes in his bathtub, except instead of "Eureka!" I was shouting "Sell!"

Это к вопросу о эпицикле Оракла-Нвидии.

The advice is correct, but in practice it's only helpful if you can time the crash, which you can't. Cycle-driven run-ups in advance of bubble burst events can be shockingly long.

[1] Which is roughly where we are right now with the AI bubble.

Fixed this for anyone still not processing the bubble.

At the end of the day it's still all about timing the market, which is hard to impossible no matter the conditions.

I see the same thing in sports broadcasting. “No 24 year old rookie player has started the season with this many at bats from the left side of the plate against visiting teams since…”

I'm not sure that they intended to give that impression...

It reminds me of a mini-story within Michael Lewis' Flash Boys - there was a massive project to drill through the solid granite of Pennsylvania mountains in order to lay a new fiber-optic cable so that High-Frequency-trading firms could use it to get their data quicker between Chicago and New York. It was done at huge cost, I think around $300m. The Fiber-optic cable could transmit data between the locations in around 13.1ms - 13.5ms.

However, an alternative option of Microwave towers was setup and installed to transmit data between the same locations. The Microwave Tower could do the same, but around 8.5ms-9ms, ~30% faster. And it didn't cost anywhere near as much.

I worry that not only are those current capital expenditure plans wildly unaffordable, but also that the risk of an innovation rendering all that infrastructure obsolete can't be ruled out. It's a massive gamble.

Your analogy required no technological innovation, just a good look at solution space. Where's the microwave tower for AI that everyone is missing?

It's not just a gamble on technology - it's a gamble on the company too!

You own a company's stock - not a technology's!

In the dot com era, it was the realization that the wrong companies were picked that popped the bubble. Turns out pets.com was never gonna be the billion dollar business. It was that book store Amazon instead. And it was the Google search engine not the other one. And browser A not browser B... And so on... When the expected winner shifts away from one company towards a position where people want to sit on cash and wait and see, you suddenly get a massive rush to the exits and poor pets.com needs to throw in the towel.

We're gonna find out in the next couple of years who the pets.coms are.

Hermes: You invest this penny like you wanted.

Dwight: Thanks, Dad. I'm gonna take this and buy five shares of Amazon.com.

Hermes: A risk-taker? That's my boy!

In today's shares Amazon peaked at $5/share in December 1999 (adjusting for splits etc) but by early 2003 had collapsed to about $1.

Certainly enough to joke about it as a cartoon writer.

Today of course it's $250 a share.

The "AI" firms have no such certainty that "AI" translates to revenues that will exceed their expenditures

All they have is endless speculation