Is A Meltdown In Tech Stocks Nearing As Doubts Of A.I.'s Impact Mount? | Fred Hickey
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- Опубликовано: 3 окт 2024
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So far this year, the top 10 stocks in the S&P 500 have accounted for more than 76% of the index's gain.
This is the 2nd most concentrated reading for the S&P in the past 20 years. The highest percentage was 79%, achieved in 2007, right before the Global Financial Crisis.
Are we in a new AI-powered Tech renaissance that will continuing powering the markets higher for years to come?
Or are we risking a major market breakdown, putting all our hopes in a handful of companies that can't keep growing at the meteoric rates that Wall Street is expecting?
For answers, we're fortunate today to speak with Fred Hickey, editor of the highly respected newsletter The High Tech Strategist, which Fred has been publishing since 1987.
Fred is extremely worried about the lack of demonstrable return-on-investment from the hundreds of $billions currently being spent on generative A.I.
In his estimation, the tremendous valuations currently being awarded to A.I.-related stocks is on par with the infamous Dutch tulip and South Sea manias. He predicts the current situation will end as painfully as those asset bubbles did.
#nvdia #aapl #artificialintelligence
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That was amazing! 25 minutes of non interruption and just plain common sense. Keep it going.
Dude was straight cooking
His insight was amazing but it doesn't change the fact that even though all these guys make a ton of sense, they've have been wrong for many months and years even.
@@CaptainCaveman1170 A big part of the reason is that we are historically overdue for a bear market and have had a new record ongoing yield curve inversion with the lag effects of unprecedented fiscal and monetary stimulus to my knowledge.
It is smart for Adam to recognize he had a unique opportunity and he allowed Fred to be Fred. I know his work very well over decades. He is spot on, including when he says he does not know how long the craziness can last.
EXCELLENT guest. As a 40-yr Silicon Valley veteran, I probably appreciate him more than most. Please have him back more frequently.
Adam, suggest you consider asking Mr. Hickey to be a recurring guest, given the importance of this sector.
This may be the longest interview on record regarding a guest speaking his spiel to completion without being interrupted by Adam! Actually impressed. Enjoyed it.
It is so common for these RUclips interviewers to get great guests, then interrupt the guest’s train of thought, resulting in a lost point or comment. It is a conspicuous habit of great interviewers to let their guests finish their thoughts/answer, rather than interrupt them. The listeners are always more interested in listening to a great guest express his/her thoughts than the interviewer.
I have been working in tech since the 1980's. Think this fellow is right on target. Today reminds me of 1999.
Please have Mr. Hickey back.
Perhaps the best guest you have ever had on your show. Articulate, fact-based, and non-biased (i.e., not talking his book). Everyone "feels" like this is a bubble, at least Mr. Hickey said it out loud.
Fred is plain spoken, insightful and truthful. Great guest Adam
Totally agree! Well said!
I have subscribed to Fred’s newsletter for several years, and I highly recommend it.
Adam - Thank you for having Fred back on with you. I have been a subscriber to his newsletter for over 25 years. It is a must read for serious investors. He doesn't do a lot of interviews so that is a real feather in your hat. And, as always, your interview skills are top notch!
💯💯💯
Well, I don't appreciate the Gen AI sh*t that Microsoft put into my apps that keeps trying to rewrite my stuff to an inferior standard.
Or the chat bots that ask the same question over and over
@@Jalleur14325 Happened to me with UPS's virtual assistant. I wanted to pre-sign for my package, and asked it to clear the signature requirement, so the driver doesn't give me a "we missed you" slip. It just repeated information to me that I already knew. Eventually, I found the solution independently.
Right? I've been finding that a lot on proofreading where I find words and phrases that I never intended to be there but Microsoft has put them there. If I didn't proofread, I'd be turning out incoherent garbage.
One of the best guests you have had. He is thoughtful and gives great reasoning.
Very salient content. Fred Hickey's insights are spot on. Realistic and straightforward. Thank you.
Fred always makes good points, but he's been calling the tech crash for a decade.
Ha ha . I don't doubt it
If investors actually invested using their brains instead of jumping on index funds, tech would have already crashed. It still will.
Tesla is buying into Autonomous self driving not llm, and for autonomous human like robots. Others are investing in graphics and video generation. Why did Fred not talk about those uses?
Wow. I absolutely loved this interview. Thanks as always, Adam. Please keep it up!
Outstanding interview
Fred Hickey is spot on. Great interview. Thanks Adam.
This is one that I’ll need to listen to twice. Thanks!
I was thinking the same thing!
Outstanding work again, Adam
I design AI products at the OEM level. In terms of marketing, it's a scam. Most AI is basic pattern recognition algorithms. There's no intelligence behind it whatsoever.
It doesn't need to be intelligent to boost productivity. When a lawyer, software engineer, or graphic designer can complete four times as many documents in the same time, the increase in profitability is immense. For knowledge workers, it's like a farmer jumping from horses to tractors
@@junglecat7263 Misses the point. People are blindly investing way beyond rational P/E assuming AI is magically able to think on its own.
@@junglecat7263this is why people fail. Same with Elon "it's not exactly what he said it was" ok... But it's better than anything ever done right? "I'll land a rocket by march" he does it by August "Elon is a failure!" had anyone ever landed rockets? No. But let's just focus on him being "wrong" rather than an insane achievement. And they don't realize, they only know the failure because the media told them. Disney failed and delayed tons of projects. Intel. Apple. Every company does what Elon does. It just never makes news because no one cares. But Elon, everyone cares.
20:00. Remember when people did sales multiples to show tesla was over valued when it was 20-50B valuation? And now, it makes 10B in profits. Pepperidge farm members.
Interesting point. Could you provide more info?
Excellent interview. Appreciate Adam giving Fred so much time to talk. Learned so much. Please have Fred back more often. Thanks Adam
Another superb interview! Thank you Adam.
I subscribe to Fred's letter every year and it is a must read every month. I totally agree with Fred about the hype bubble in AI and AI chips. This might be the best short opp of our lifetime.
Outstanding interview. Fred always has great insights, and Adam is a great interviewer - he doesn't interrupt his guests. Please bring Fred back as soon as possible! A real breath of sanity and common sense, with the data to back it up.
Thank you Adam. You are revolutionizing how we are informed of the truth. Trust the process. 🙏❤️
Best interview I’ve watched this year.
Really on point… fantastic ✨
Best interview to date.
Been subscribing awhile. The last time Fred recommended a tech stock was 2008 when Microsoft was $20. At 38 he said to sell, it was overpriced in 2009. He has not recommended a tech stock in 15 years. Just for context.
@rossperreault3199Meanwhile you’ve lost out out massive returns waiting an entire generation for your chicken little predictions to come true.
One of the best tech summaries I have ever heard.
I wonder if it was generated by A.I.?
😂
No, it made too much sense.
Thanks guys!
Great interview guys well done Adam Fred thanks this is a 2 time listen
Excellent interview. Appreciate Adam giving Fred so much time to talk. Learned so much. Please have Fred back more often. Thanks Adam
Phenomenal interview and conversation, Adam! The insights shared by Fred are extremely valuable, and prescient! Thank you so much for having Fred as your guest. Please have him back sooner, rather than later. 👍
The most informative guest in some time. His insights are Brilliant!
Purchasing a stock may seem straightforward, but selecting the correct stock without a proven strategy can be exceedingly challenging. I've been working on expanding my $210K portfolio for a while, and my primary obstacle is the lack of clear entry and exit strategies. Any advice on this matter would be greatly appreciated.
Even with the right strategies and appropriate assets, investment returns can differ among investors. Recognizing the vital role of experience in investment success is crucial. Personally, I understood this significance and sought guidance from Desiree Ruth Hoffman, significantly growing my account to nearly a million. Strategically withdrawing profits just before the market correction, I'm now seizing buying opportunities once again.
That's incredible! How can I connect with the person who helps you with investments, if you don't mind sharing? I could use some guidance at the moment.
@@OliverLiam-px3vx Desiree Ruth Hoffman is the licensed advisor I use. Just research the name. You’ll find necessary details to work with her correspondence to set up an appointment.
Thank you for this pointer. It was easy to find your advisor; she seems very proficient and flexible. I booked a call session with her.
Useful information! Fantastic interview.
Great interview, and here we are at that breaking point when the market is starting to show its weakness. Thank you, Fred, for sharing your viewpoints, and I hope you can return soon.
Fantastic interview!
I’ve recommended it to multiple people, including people who aren’t into watching financial interviews/discussions/news. (First time I’ve ever done that.)
Hi Adam - Thank you for another fabulous interview, and Fred Hickey was awesome!
Excellent interview!
The best EVER!!
Wow, this was a phenomenal interview. The answer to your first question, Adam, tied all the recent macroeconomic data into a beautiful bow. Yes, please bring him back.
Fred Hicky is amazing. He explained the current economy very succinctly.
OUTSTANDING INTERVIEW!
I LOVE TECHNOLOGY and my portfolio is weighted heavily in tech stocks. Wonderful view from an expert in the industry giving a sober look at the reality of tech stocks!
One of the better interviews. Very insightful.
I just stopped by to give the video a 👍 and leave a comment for the algorithm.
I listen to the show on the audio only podcast because the number of ads make to content unwatchable on RUclips.
This guy is epic mad I love it!!
What an insightful interview. Thank you Adam. AI generally irritates me, I don't want it on my phone, I would choose to opt out if I could.
He raises a lot of valid points
Wonderful interview. Nice to hear from someone who has been following tech for so long and knows that "this time is NOT different".
Anyone with an autistic family member understands the issue with GenAI. Discerning between satire and reality is hard. That’s why it’s funny.
I struggle to understand how it (the large language model) could be useful, even in my industry (law). Clients still like to talk to a person. We already have tools to automate and outsource redundant and simpler tasks.
Great interview. I am one of many viewers confused by Nvidia’s rapid increase in market capitalization. Thank you for trying to help us understand it, seriously.
I think its old people that don't use it that think the AI is actually a digital consciousness. I had a question so I went to google and read some pages. The answer wasn't good enough. Then I decided to ask an AI, and it just copied the first pages with the answer that wasn't good enough, but now it added "Great! Let's look at what I found:" Oh wow, what a Revolution! Its AskJeeves all over.
Very hard to be patient. But when you get ahead to a certain point, it's so great to be reminded! Thanks for this video you two!❤️🙏
Fred Hickey is unique. Experienced and genuine. His perspective is truly constructive. Bring him back soon!
I learn something new with every interview, thanks!
The most realistic and thoughtful assessment I have yet seen. As always, share market investors are largely driven by their psychological mindset i.e. positive or negative. They will grab anything to back up the story of why they feel compelled to pour money into a very narrow range of stocks - those stocks which have a disproportional influence on the indexes. The Dow 30 points in the right direction, as it usually does at inflection points, and so, unlike the S&P500 or Nasdaq has not made a new top since May. It is probably better to be cautious now rather than try to squeeze the last juice out of the market.
Fantastic interview. I specially enjoyed the comparisons with the tech bubble era.
Thank you, Adam and Fred! I appreciate the voice of experience!
Easily one of the most informed guests you've had who speaks the truth and is not just focused on selling his book. This is a crazy manipulated market where the Fed has tried desperately to use the stock market as a personal piggy bank to "create wealth" out of thin air in order to sustain the "economy". Unfortunately, only the few have benefited and if history is a guide, it will ultimately end in the same painful result for the majority. How long this will take could be the only unanswered question.
Thanks Adam. Great show with Fred.
Loved Fred Hickey!
Best interview yet!
Excellent analysis!
Great show and guest Mr. Taggart. This guy knows his stuff and is not afraid to call a spade a spade. This is gambling absolutely no fundamentals. Everything is based on speculation and those volume indicators. I wish you would do a show explaining the difference between technical and fundamental analysis, Mr. Taggart, great show as always thank you
I wish Adam would do a show on chart analysis vs fundamentals. True statement at 19:50 “valuations mean nothing”. I’m up 24% in the S&P and have a 3% stop loss. Is it overbought? Yup. I’m here to make money. When I get stopped out I’ll swap to an index going up, an inverse index, or cash while looking for a trend. All while the fundamentals trader is saying “see we’re in a depression”
Very good interview, liked to hear his opinion in AI, Nvidia, also what he said about the gold stocks and why they catch up later as India and other countries pour money in gold but not in the mining stocks and they are still value players for now and will eventually catch up, and his insight on what is he positioning now like in treasuries as eventually the value players will go up... one of the best interviewrs lately
Fantastic interview, Adam. Thanks Fred.
McDonald’s dropped their AI ordering platform they had been testing throughout the country…
It’s not even ready to have people order French fries yet…. Maybe one day-but it’s not near being a profit move based on the costs
This is the biggest red flag. Take your profits and run.
I don't think some hiccup is going to derail AI. Don't like it don't invest in it, but all the doom and gloom is exaggerated. It may be a turning point for the country the economy and result in a huge bull market too. No one knows anything. That's why making money is better than predicting the future.
@@QDBRockin The biggest red flag is when the strippers run GenAI conversations.
@@MomoTrader809 Its not the doom and gloom exaggerated, the upside was vastly exaggerated. Things people were doing for years all of a sudden was going to turn the world upside down, and a year later onwards nothing changed except old people learning about chat bots.
Very informative interview.
Great Interview, great guest, explained exactly how the stock market behaved in the last two years
A dose of reality! Thank you, Adam, for hosting this informative session.
Thank you for that great information.
Us budget deficit running at over 2 Trillion so far this year. Thanks baseline budgeting! Lazy politicians not doing their job and producing the Constitutionally required Budget each year It’s a Disaster of Biblical Proportions. 😢😢😢
Adam,
I would very much like to hear Fred view on Tesla AI and derivatives like robotaxis and robots.
Robo taxis aren't really AI, he's exactly right that this isn't general intelligence
Yes!!!
This is really interesting, I agree and I work in tech
Thank you both!
You only make $$ when you cash out .... then inflation takes it's toll ... there were a lot of wealthy people "on paper" in 1928
Well said. IMHO today, right now... folks are worth half of what they think they are. They don't know it yet but when it all goes I think most folks are going to be shocked. Shocked so bad that they will be frozen and will not act. This will cause them to hold their longs all the way down. 15 years of nearly free money has made many people rich that did not deserve it. The markets are great on inacting vengence. If somone can say they know exactly why they made money, what the trade plan was, what the money and risk profiles were... what the buy and sell events are... they can be comfortable. They earned that money... for the rest of the folks ... they got lucky. Luck in the markets is temporary. I fear most will be wiped out. Someone is going to get all that money. It will be one of the biggest wealth transfers of all time. It is going to take some timing (very difficult but not impossible) and balls of steel. I already have a large short postiiton (not reommended for most) that we get an at least 50% crash. Every month as we go up I add 2 to 4k to that. I am willing to lose all that money because if I am correct my family and I will never have to worry about money again. And once I make all that money... I am going to buy cars and houses that everyone is fire selling.
Indeed, amazing insights, Fred.
Yesterday it was the S and P 500 to 9000 soon, today it is a house of cards. Excellent interview!
Maybe it needs to get up to 9000 before it goes down to 900.
That did cross my mind.@@PCGamer77
Such an important interview. All tech crazed investors should watch, like a splash of cold water on the face. Thank you
Good interview.
Brilliant episode!
Another great interview sir... As a veteran of the tech industry in large multi-national i constantly witnessed upper management hyping some new technology that was going to replace workers and mint money .... and it rarely if ever unfolded as expected.
It's worth remwmbering that even the railroad - that crowning achievement of 19th century engineering - was a speculative mania. 115 US railroad companys went bankrupt 1873-4.
Excellent interview, full of valuable insights. Thank you!
Great Interview!
Good podcast. Great guest
Thank you very much...
Good analysis.
Great show, Adam.
Great analysis.
BRILLIANT ... ONLY COMMON SENSE, note very common today ....
Dear Fred This has been the best video I have watched for months. Your message is what I have been thinking for some time but you managed to put all the pieces together in my head. A massive massive thank you.
Excellent guest.
So precious. Thank you!
Great guest!!!!!
I am an ML Engineer and can get on board with his assessment that over the long term AI has been and still continues to deliver value, but the GenAI revolution is overly hyped. The 90% rate of failed deep learning projects has become 95% failure to get value from GenAI. His estimation of GenAI being like the fiber buildout of the early 2000s is a little off though. The mania driven by executives without the means to gain value from these technologies will be partially offset by firms with the staff who can actually use AI/ML effectively. I see young people doing amazing things with GenAI including things not strictly LLMs.
you see young people doing what amazing things with AI? I do know for coding as well as cyber security, AI is an essential tool, but what else are young people using it for? I'm curious.
Image generation is neat, I'm not sure what young people are doing that's neater but there are neat things
I code for a living, and I fail to find value in the tool that I have to constantly correct - it's easier for me to do it the way that I want (or right) the first time. I dont want to fill in an auto-generated template, and I find it easier to write the code than to write a prompt. For smaller tasks, I would rather hire a junior engineer.
@@jacobfurnish7450 It seems writing reports for class. It was a humorous tidbit that once Summer Vacation hit, public usage of GenAI dropped off a cliff. I wonder if it is the same this year.
@@gentronseven before GenAI went mainstream, using it to replicate celebrity voices was all the rage on youtube.
Wow what a great insight! Thank you so much!
The WSJ has had articles about how spending was $50B just on NVidia AI chips. I think he's right about total spending of > $200B, but all this for $3B in revenue? When we hit recession and stock prices are falling, AI will be the first thing cut; it generates the most losses.
I think a sign of the collapse will be them trying to recoup losses by jamming AI into everything just to get some return. I remember buying a DLP TV when that was the next tech to surpass LCD TVs way way back. When your coffee machine has "AI" features you know its time to bail.
Fantastic guest. Great show
Great interview, Adam.
Adam, I subscribe and have been following you for quite a while. This was the best episode I watched. Congratulations and thank you very much!
Thank you & so glad you enjoyed it!
Great interview!
Thanks Fred , really enjoyed your interview,will checkout your website❤️🇨🇦