Since some times now the AI bubble is growing and its consequences with it, flash storage price increase, electricity went wild in some places, GPU… Don’t need to say anything sadly… NVIDIA became the most valuable company exceeding 4T
So when all of this will go crazy and grow to the burst? When does prices will go down and speculators rushing out of it?
Open question feel free to explain the wider you can, I’m not a financial so I’m really interested in some analysis of the situation :)
Any time now…
See?! Red! …Oh, wait. That’s just the profit line.
I’d say around late 2027 to somewhere in 2028. A crash around five years past the release of ChatGPT seems reasonable.
Seems like soon.
As the old investment saying goes:
The market can remain irrational longer than you can remain solvent.
Be ready, but don’t bet on when it busts.
…Also, I think this is more ‘dotcom bubble,’ where it burst hard, but the internet ultimately didn’t go away.
I don’t think AI should completely melt away but to be more responsibly added to the global technology
My prediction is: Not anytime soon. Seems we’re getting lots of coverage in the mainstream now, and people start to question if their financial investments are safe or if we’re gonna re-live the real estate bubble from a few years ago.
But there’s still a datacenter popping up every two weeks, an absurd amount of money being invested in these companies and everything around it up to small nuclear reactors. The people with lots of money are still firmly seated in the hype train. And if past investment bubbles taught us anything: It takes way longer than we’d expect until they finally burst.
So I’d say it could pop any day, but I think this is unlikely to happen within the next 2 years or so, maybe more. Though you might want to think about your retirement fund now and make sure there’s some money in other assets.
Would you think that an announcement about an impossibility of pushing transformers further would results in a burst of the whole bubble?
Hehe. We’ve already had several "AI winter"s. For me it’s pretty much settled by now that transformers and maybe even large language models itself won’t scale well past what we have today. And I don’t think they’ll lead to super-intelligence, which used to be the sales pitch. And I think several high profile scientists hold that opinion. I’m really split on this. These bubbles are volatile. All it takes is enough head fond managers to pull out and maybe a large company like Microsoft. It’s somewhat rare companies at that size just fail, but I guess it’s possible?! I mean I’ve also predicted Bitcoin to fail several times now because it’s not as usable as promised, yet that always climbs to a new record high. So I’m a bit more careful with my predictions these days. There’s still lots of things we can shoehorn AI in to. We’ll see it in robotics and that’s barely started. And ultimately this bubble isn’t fueled by realistic expectations in the first place, so I’m not sure if any factual statement itself can change this. It’ll grow as long as it grows, as long as Sam Altman is able to deliver promises and as long as there’s enough money pumped in. Which might change once there isn’t enough money available anymore or if it actually stagnates for long enough for investors to want out. I just don’t think they’ll listen to reason.
I remember flying into Las Vegas when the real estate bubble popped in 2009. You could see scraped land 30 minutes out, then pavement and services going in, then partial frames and then closed envelopes. All abandoned.
Stupid money flowed in until the very last minute. The stupidest money kept going in thinking they’d buy the dip and catch that falling knife.
People will add money even after it pops. I think it was Buffet who said that the only way to really make money is to sell too soon.
Speaking of those data centers, what do you suppose we’ll do with all that compute post-bubble?
Good question. But technology always finds ways to eat up resources. I mean we’ve come from computers with few megabytes of memory and slow internet connections to several Gigabytes of memory and Gigabit internet connections, smartphones with double the processing power every few years and they roughly do the similar things in a lot of aspects. Call, text, office work, surfing… We had those very same things in the early 2000s with a fraction of the resources… Oh well, and we’ve gained some awesome new things like smartphone cameras or video streaming. I guess we’ll come up with use-cases. Question is just who is gonna afford to pay for operation and electricity. Compute is going to become way cheaper once the taxpayer and people ate the investment losses and the hardware is paid for. But operation costs a pretty penny so I think I still don’t have any idea about profitable use-cases given the scale of it all…
I think it’ll happen within 2 years and I think the housing market will collapse around the same time.
Not sure if I WANT to be right but that’s my prediction. Two major bubbles popping back to back.
So you think a kind of snowball effect would affect the both market?
When the bubble pops it won’t make AI go away or make prices lower, it will just cause financial pain in the market.
…which you want to happen as soon as possible, else the bubble just gets bigger.
The bigger it gets the harder it pops, maybe it’s also a good way to bury these companies down (But would have a very bad economic impact of little people…)
Don’t you think that massive stocks would be useless without any demand and that prices would remain high?
I think this is probably not a good way to look at it.
The company you work for, or the company that supplies the company you work for, or the company that manages your 401K etc are all invested in this bubble.
When I say that the growth of GDP of the USA used to be 70% consumer spending year over year and it’s now something like 60% AI, I want you to understand that consumers aren’t gonna have money to make up that 60% when this bubble pops. Because all of us will be detrimentally affected when it happens.
A lot of us don’t know where or when the blow is going to come from, and somehow we think ourselves insulated from the effect this bursting bubble will have. But that’s simply not true.
The prices of everything that we need to live and every convenience we rely on to make our lives easier is now tied to this bubble. Things are going to get more expensive when it pops (even if it craters the market on some components etc).
The bubble is getting extended now due to Saudi involvement. The domestic (and SoftBank) money hoses have lost a lot of pressure, so that shitstain MBS just got jerked off by all the oligarchs to pile in too.
May 27th 2026
Will write it down in my calendar
I would guess that it may already started to deflate a bit. The truth is that it will pop when the loans won’t be paid off so investors and banks starts to backtrack.
I am not worried about Nvidia but cloud providers. The datacenters built to support ai won’t have much use when the customers (OpenAI…) will fold.
I don’t care about what happens with OpenAI and other AI startups they probably don’t survive. Google, Microsoft, Meta… have enough money to lose so it will be bad for them but they will survive it. Hardware manufacturers see the writing on the wall and try to milk the bubble till it lasts so if they play it decently it won’t be big issue for them - they are probably the winners in this race whatever happens.
If nvidia hadn’t hit expectations it might have started something.
If you can put your finger on when exactly it will happen you stand to make a lot of money.
Never try to catch a falling knife.
Yeah, but if you manage to avoid cutting your fingers off you get to keep a really expensive knife.
to be clear this is a joke
