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AI stocks could crash - Benjamin Todd

benjamintodd.substack.com · 1,219 words · saved by 1 readers

Nvidia’s price fell 60% just in 2022, along with other AI companies. It also fell more than 50% in 2020 at the start of the COVID outbreak, and in 2018. So, we should expect there’s a good chance it falls 50% again in the coming years. Thanks for reading Benjamin Todd! Subscribe for free to receive new posts and support my work. Nvidia’s volatility is about 60%, which means – even assuming efficient markets – it has about a 15% chance of falling more than 50% in a year.1 And more speculatively, booms and busts seem more likely for stocks that have gone up a ton, and when new technologies are being introduced. That’s what we saw with the introduction of the internet and the dot com bubble, as well as with crypto.2 (Here are two attempts to construct economic models for why. This phenomenon also seems related to the existence of momentum in financial prices, as well as bubbles in general.) Further, as I argued, current spending on AI chips requires revenues from AI software to reach hund

AI stocks could crash And this could have implications for timelines and AI safety. Benjamin Todd Apr 30, 2024 5 5 Share The most obvious reason AI stocks might crash is that stocks often crash. Nvidia’s price fell 60% just in 2022, along with other AI companies. It also fell more than 50% in 2020 at the start of the COVID outbreak, and in 2018. So, we should expect there’s a good chance it falls 50% again in the coming years. Thanks for reading Benjamin Todd! Subscribe for free to receive new posts and support my work. Subscribe Nvidia’s volatility is about 60%, which means – even assuming ef

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