[gonzobonzo]

Which companies? Google and Microsoft are only up a little over the past several years, and I doubt much of their valuation is coming from LLM hype. Most of the discussions about x.com say it's worth substantially less than some years ago.

I feel like a lot of people mean that OpenAI is burning through venture capital money. It's debatable, but it's a huge jump to go from that to thinking it's going to crash the stock market (OpenAI isn't even publicly traded).

[smallerize]

The "Magnificent Seven" stocks (Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, and Tesla) were collectively up >60% last year and are now 30% of the entire S&P500. They are all heavily invested in AI products.

[gonzobonzo]

I just checked the first two, Apple and Amazon, and they're trading 28% and 23% higher than they were 3 years ago. Annualized returns from the SP 500 have been a little over 10%. Some of that comes from dividends, but Apple and Amazon give out extremely little in the way of dividends.

I'm not going to check all of the companies, but at least looking at the first two, I'm not really seeing anything out of the ordinary.

[PessimalDecimal]

Currently, Nvidia enjoys a ton of the value capture from the LLM hype. But that's a weird state of affairs and once LLM deployments are less dependent on Nvidia hardware, the value capture will likely move to software companies. Or the LLM hype will reduce to the point that there isn't a ton of value to capture here anymore. This tech may just get commoditized.

[anon291]

Nvidia is trading below its historical PE from pre-AI times at this point. This is just on confirmed revenue, and its profitability keeps increasing. NVIDIA is undervalued right now

[namaria]

Sure, as long as it keep selling $130B worth of GPUs each year. Which is entirely predicated on the capital investment in Machine Learning attracting revenue streams that are still imaginary at this point.