When ChatGPT launched in November 2022, it shattered records, reaching 1 million users in just five days. By February 2023, we were deep in conversation about AI’s transformative potential, and by November 2023, we were asking: What if AI is underhyped? Nvidia’s stock price has since tripled, briefly becoming the most valuable company in history.
George Soros once said, “When I see a bubble forming, I rush in to buy, adding fuel to the fire.” His theory of boom-bust cycles helps explain Nvidia’s meteoric rise—and hints at what might come next.
Soros’s framework suggests that bubbles follow a predictable pattern:
- A trend gains momentum, reinforced by a powerful misconception.
- The trend faces tests, but survives, building confidence.
- Market expectations disconnect from reality.
- Doubts begin to creep in—a “twilight period” where faith wavers.
- The trend reverses, becoming self-reinforcing in the opposite direction
AI’s adoption is real—both consumers and businesses are integrating it rapidly. Yet, the sheer scale of investment raises a familiar question: Are we in an AI bubble?
Jensen Huang, Nvidia’s CEO, has declared, “This is the beginning of a new industrial revolution.” It’s a bold vision, but also the kind of sweeping narrative that fuels market misconceptions. He predicts data centers will double in value to $2 trillion within five years, evolving into “AI factories” that drive a new era of computing.
The numbers back up the fervor. Data center project starts surged 81 percent in 2024, with construc
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