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Posted (edited)
On 12/21/2025 at 1:22 PM, Dbeasy said:

I was deeply involved with the 2000 stock market bubble and crash, having a startup I helped found go from a value of $1M, to $3B, to $0. We were building the fiber infrastructure. 

There are a lot of parallels, and a few differences, from the 2000 bubble. Valuations in 2000 were completely insanely nonsensical. My company had $7M of revenue going to $35M and we were valued at $3B in IPO. Ridiculous.  

We don’t actually have that bad of a valuation environment for public companies, IF you assume the AI companies actually deliver the projected revenue, and some believable path to profitability. But they won’t, and when that becomes obvious, the markets will tumble and over-react into all equity sectors. 

When will that become obvious? Captainant is roughly right. You can argue about percent of spending on GPU’s but once it becomes clear the math doesn’t work, it pops. I’m guessing 12-18 months. 

And the problem with inflation right now, setting aside the fake data just released, every company now is ingrained to raise prices every year, year after year. It didn’t used to be that way. And because we have insufficient competition in dozens of markets, due to poor government oversight over the years, there is no governor on prices. Companies are maximizing price with little to no fear of share loss. 

Combine that with completely irresponsible government spending and the outlook is not good Vern. 
 

 

Im not quibbling over a few percentage points. The broader AI market - which is critical to a discussion of a AI bubble brings total GPU spend down by over 50%. That’s not insignificant. 

There are key differences with the dot com bubble too, the companies spending heavily on AI are the big tech companies that are already profitable, allowing them to make absurd investments for long term market capture. that alone is a massive difference. 

in the dot com bubble anyone with a “.com” was automatically seen as inherently valuable. The value in these AI platforms is far beyond a farce. Further, those “.com” companies were largely unprofitable. While there are new comers that will fail in the AI race there are hundreds of companies currently monetizing AI in their tech stack providing real value for revenue. 

there will be a shakeout of companies that can’t compete but I don’t see a bubble in the same sense.

i do see a zombie economy though and as soon as AI has a pull back, I do think there will be pain.

so for all intents and purposes - except picking long term winners and losers - it may all be the same. 

Edited by scramblyn

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