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- 💥 AI Bubble is Totally Out of Control
Read time: 5 minutes
AI hype train might be speeding toward a crash, and big names like Nvidia and Meta are right in the front seat. Every large AI model is secretly learning the same language.
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AI INSIGHTS
According to Apollo’s chief economist Torsten Sløk, today’s AI boom is more dangerously inflated than the 1990s tech bubble, and this time, there’s way more at stake. We’re going bigger, and potentially worse.
→ The top 10 companies in the S&P 500 (Nvidia, Meta, Microsoft, Google, Amazon) are more overvalued now than they were in the late ‘90s.
His internal data shows P/E ratios (price-to-earnings) are at dot-com-busting levels. Except this time, almost 40% of the entire S&P 500 is tied up in those 10 names.
So if you think buying “the market” gives you broad exposure, you're basically betting on whether AI hype keeps soaring. Here’s what’s feeding the bubble:
Nvidia is pushing a $500B plan to build “AI factories”
Meta is allegedly offering $100M signing bonuses for top AI hires
Amazon may drop $8B more into Anthropic
OpenAI just spent $14B on ScaleAI… which then laid off 200 employees
Here’s what the sentiment looks like:
The BUZZ NextGen AI Sentiment Index (basically, an AI hype index for retail traders) is up 45% in 16 weeks
It's trading 29% above its 200-day moving average → highest since peak 2021
Analysts at BTIG say this is starting to look very frothy
Why It Matters: Let’s say the bubble pops. Then what? It won’t kill AI, just like the dot-com crash didn’t kill the internet. But the fallout could be rough. The tech is progressing. But that doesn’t mean Nvidia should be priced like it will run the entire global economy.
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TODAY IN AI
AI HIGHLIGHTS
📱 Perplexity partnered with Aitel to offer Free 12-month Perplexity Pro to all its 360M customers & shot straight to #1 on India’s app charts. You can check out & get it here.
🧠 Good news, AI may NOT replace services after all, because customers want to pay software prices for software, not salary prices for software. Mert Deveci wrote about this myth.
🗣️ Hume’s EVI 2 was already remarkable for making every voice unique. Now it gave access to EVI 3 model that captures more of your personality to build language coaches, podcast hosts,... You can try it here.
💰 OpenAI researcher (allegedly joined Meta soon) gave a 30-minute master class on how to create wealth in our new AI-powered economy, racking up at least 1M views.
📱 Perplexity Comet is scary good. It connects to your apps and does everything you want autonomously. If you're still confused, watch these 10 powerful use cases.
💰 AI Daily Fundraising: Lovable, a Swedish AI app builder, hit $75M ARR in 7 months with 2.3M users and 180K paying. It just raised $200M Series A at a $1.8B valuation, only 8 months after launch.
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AI QUICK HITS
🤖 10 examples of how “brutal” robot testing made them more robust.
🧒 Elon Musk's xAI introduces Baby Grok chatbot for children's learning.
📄 Here's how to write an effective AI prompt, according to Anthropic.
🔴 Sick of AI slop? You can block AI-generated images using DuckDuckGo.
⚖️ Meta refuses to sign EU’s AI code of practice after carefully reviewed.
AI CHART
As AI models get bigger and smarter, they start learning the same things, in the same way. If true, this has massive implications for everything from whale communication to decoding ancient languages.
They say there’s one ideal way to represent relationships in the world → and all large models are converging toward it.
MIT formalized this in 2024, showing that bigger models in vision and language learn strikingly similar features. → Basically: The smarter they get, the more alike they become.
Now for the wild part, turning an AI’s internal vector back into the exact input text. It’s really hard. But by using iterative refinement and millions of queries, his team hit 94% accuracy on long sentences. If all big models speak the same internal language, we might:
Build universal inverters
Translate between closed models
Decode ancient texts like Linear A
Or even… talk to whales via shared semantic structures (hello, Project CETI)
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The AI Fire Team
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