what is predicted to happen when the bubble bursts? A bunch of AI companies suddenly find out they really aren’t worth shit, and so every index fund, hedge fund, retirement fund etc on the planet that invested in them loses their shirts and we all end up holding the bag?
The short answer is more capital consolidation at the top. The few companies that survive will gobble up everyone else, and a bunch of people will lose all their savings in the process.
The entire stock market is propped up by the “Magnificent 7”, and without their outperformance over the last 2 years the market would be flat. And all of the gains to the Mag 7 stocks have come from increasing AI infrastructure. They’re essentially forced to keep spending more or investors will lose confidence and trigger a downward spiral. Of course they will eventually have to show revenue from that investment or the whole thing collapses. To put into context just how much large Nvidia has gotten since ChatGPT was unveiled - its market cap is now larger than GDP of EVERY nation aside from the US, China and Japan. And that’s from selling the chips that the hyperscalers (Microsoft, Alphabet, Meta, Amazon, Apple, Tesla) need for their AI. We are at dystopian sci-fi levels of concentration in the economy now.
Seems like expropriating the middle class is one of the last (relatively) untapped sources of profit available to the system. There are still a decent number of retired office-workers with maybe $1M in a 401k and maybe half that in home equity. Add in the small business owners and small-time landlords. A lot of the economy is based around siphoning a couple percent here and there out of this group, but at some point they’ll get desperate and find a way to take it all at once.
Christ is it really down to that? They’re siphoning the last vestiges of what the system had previously paid out during a more equitable time? Oh god lmao
Yeah I’m just waiting for them to figure out how to somehow screw the index investors.
I mean, everything I’ve saved is in low cost index funds, I just assume I’m going g to wind up getting fucked and am powerless to stop it or make any choice that would keep it from happening.
what is predicted to happen when the bubble bursts? A bunch of AI companies suddenly find out they really aren’t worth shit, and so every index fund, hedge fund, retirement fund etc on the planet that invested in them loses their shirts and we all end up holding the bag?
The short answer is more capital consolidation at the top. The few companies that survive will gobble up everyone else, and a bunch of people will lose all their savings in the process.
The entire stock market is propped up by the “Magnificent 7”, and without their outperformance over the last 2 years the market would be flat. And all of the gains to the Mag 7 stocks have come from increasing AI infrastructure. They’re essentially forced to keep spending more or investors will lose confidence and trigger a downward spiral. Of course they will eventually have to show revenue from that investment or the whole thing collapses. To put into context just how much large Nvidia has gotten since ChatGPT was unveiled - its market cap is now larger than GDP of EVERY nation aside from the US, China and Japan. And that’s from selling the chips that the hyperscalers (Microsoft, Alphabet, Meta, Amazon, Apple, Tesla) need for their AI. We are at dystopian sci-fi levels of concentration in the economy now.
This bubble is massive enough to where it could bankrupt the entire lower and middle income brackets.
At that point, the Buckies
come out and hopefully the people do some 
-TIME, instead of targeting each other.
Yeah, it’s beyond “too big to fail”. They’re gonna bail them out like crazy.
Seems like expropriating the middle class is one of the last (relatively) untapped sources of profit available to the system. There are still a decent number of retired office-workers with maybe $1M in a 401k and maybe half that in home equity. Add in the small business owners and small-time landlords. A lot of the economy is based around siphoning a couple percent here and there out of this group, but at some point they’ll get desperate and find a way to take it all at once.
Christ is it really down to that? They’re siphoning the last vestiges of what the system had previously paid out during a more equitable time? Oh god lmao
well there’s still social security that could be gutted
Yeah I’m just waiting for them to figure out how to somehow screw the index investors.
I mean, everything I’ve saved is in low cost index funds, I just assume I’m going g to wind up getting fucked and am powerless to stop it or make any choice that would keep it from happening.