tech
There isn't just one AI bubble, strategist says — there's a 'rolling sequence of bubbles' instead
The question of whether AI is a bubble is the wrong one, Dhaval Joshi argues. The right question is: which AI bubble is popping today?
TL;DR
- Dhaval Joshi proposes that AI is not a single bubble but a 'rolling sequence' of bubbles inflating and deflating rapidly.
- This pattern explains volatility in sectors like software-as-a-service, silver, and semiconductor stocks, as investors misjudge value capture.
- The extreme price swings in these sectors, like silver's tripling, are indicative of bubbles rather than normal market reassessment.
- Potential catalysts for a market-wide crash include sharp rises in real interest rates, a rapid unwinding of the capex cycle, or a significant recession.
- Joshi outlines three potential scenarios for who ultimately captures AI's value: corporations with moats, superstar individuals, or the general consumer through price collapse.