The AI Rally: Sorting out Heft from Hype

It's been a while since we've posted a Razor's Edge episode, and a lot has happened! A whole banking crisis came and went and apparently is all resolved (?). More relevant to the sort of things we talk about, the Nasdaq has returned to full bull market mode, powered by the excitement around generative AI, as best embodied by Nvidia's smashing earnings report of late May 2023. There's a lot to be legitimately excited about with this trend, and at the same time, like every exciting new thing, there's a lot to be suspicious of. Is generative AI going to generate us right out of what was still a re-centering, declining tech market? Can generative AI be good for every publicly traded tech company except CHGG? When does chat GPT replace us as hosts? That's what we cover on this week's episode, more or less. Topics Covered 3:00 minute mark - The macro backdrop for this bifurcated rally 7:30 – What we learned from NVDA’s report 15:30 – How this AI compute trend plays out across the semiconductor sector 24:00 – AI uses and AI losers or trade-offs 34:00 – Bear market rally, death of permabears, and the many crosswinds 46:00 – How the cost-cutting rally collides with the AI investment rally 53:30 – How does anyone get an edge using AI