Nvidia falls, has Ai's bubble burst?

Although the A-share market is ridiculing that Nvidia's stock price has been pulled down by high-tech development, we have to think about it, is Nvidia's decline expected to fall only last night?

This chart is a historical comparison made by Hong Hao on Weibo on March 7 this year, using Cisco's stock price during the Internet bubble in 2000 to map Nvidia's current stock price.

Want to ask Weibo netizens what conclusions can be drawn?

As a result, the gods in the comment area began to spray wildly, what PE, performance, and Apple's various evidences to show that Nvidia is the god of the future.

China's internet is easy to create gods, and gods are unquestionable, whether it's Elon Musk, Jensen Huang and so on.

Of course, we can't say that $1,000 is the top of Nvidia, and no one can know the future world, but history can learn from it.

To summarize the factors of this sharp decline, it is none other than the following:

First: the Fed's hawkish expectations, as we all know, from 2024 onwards, the Fed's interest rate cut expectations are the main factor pushing the Nasdaq index higher.

Originally, the market expected the Fed to cut interest rates at least three times in 2024, and at worst no rate cut.

However, according to the recent forecasts of the Federal Reserve and investment banks, the general market now believes that the Fed's base interest rate may be raised to 6.25% in 2025, and JPMorgan Chase even said that it will raise interest rates to more than 8%.

The recent speeches of Fed officials have also slowly released more expectations to the market that interest rates will continue to be raised.

Second: AI cannot see the application scenarios that can be implemented, and after OPen AI's chat GPT became popular around the world in the second half of 2023, the primary market has been raising the valuation level of AI-related companies.

Even Open AI once raised trillions of dollars from the market, but the result was less than a few thousand dollars in revenue, which made many people see no hope in the short term, and the scenario could not be implemented and there was no way to create profits.

Tens of thousands of GPUs are purchased and consumed a large amount of electricity, but people can't see the application scenario, which is a headache.

Third, the involution of the smart chip market, because the price of GPU is too high, many AI companies are trying to develop their own chips, in order to reduce costs, although there is no impact on Nvidia's revenue or industry status now, but what about the future?

Even Open AI has to develop its own chips.

In the context of the Fed's interest rate hike, we have to think about what kind of risks the market is avoiding and what opportunities are looking for at this stage.

We must also admit that at this stage, the global macro economy is at a turning point from depression to recovery.

This stage is very difficult.

It is important to note what is a real opportunity.

Even if AI is really the direction of the future, will the company that will eventually rise be NVIDIA?

Is the ultimate industry juggernaut really in the United States?

But regardless of whether Nvidia can still create a myth, a decline is difficult to avoid under the expectations of the constant hawks in the United States.

In particular, in the context of the continuous depreciation of global currencies, it is still necessary to consider more risk aversion rather than risk.