00:00 Speaker A
Finally, let’s talk AI. Uh, Domi’s the conversation. Uh, I thought of you, my friend, because I saw Jared Bernstein. He’s a smart guy. He had an op-ed this week, a new op-ed, he was talking about the AI bubble, which I know you think a lot about. And here’s what Jared said. Jared says, a bubble occurs when the level of investment in an asset becomes persistently detached from the amount of profit that asset could plausibly generate. And Mr. Bernstein says AI investment, in his opinion, fits that pattern. What do you think?
00:36 Speaker B
I’m not so sure about that.
00:37 Speaker A
How come?
00:38 Speaker B
Well, you disagree with Mr. Bernstein.
00:39 Speaker A
I do. I do. I do. And the reason being is that, you know, when we look back at other markets, whether it’s, you know, the the mobile phone, the smartphone, the internet, you know, we have to pay attention to what is existing capacity, what is demand for that capacity. And all indications are, whether it’s enterprise or consumer, we’re still in the relatively, you know, early innings, not the initial innings of adoption and usage, not the first or second. I would argue we’re more like, you know, third inning, fourth inning, something like that. I get a little worried when we flash forward and it’s more like the seventh inning, eighth inning, and the rate of incremental adoption or incremental usage is starting to slow. That’s when I get worried because then we risk overbuilding.
01:25 Speaker A
I had a uh a smart analyst on the show, um, been doing this a long time and I asked him, do you think, I mean you you covered mobile, you covered internet, right? Is this another paradigm shift? And he said, not only is AI a paradigm shift, it’s going to be bigger than those two.
01:46 Speaker B
I agree with that. I I I absolutely agree with that. If so, you know, there’s a lot the easy comparison is to um the internet because it profoundly changed how we work.
02:00 Speaker A
It’s and are you saying because you ultimately it’s as big or bigger?
02:04 Speaker B
I think it’s, you know, I’ll say this. Back in ’98, ’99 when we were in the baby days of the internet, did we think we would be streaming, paying bills, and all the things we take for granted now? Not at all. So I suspect that there’s going to be a lot of incremental applications that we haven’t really thought about, that may disrupt how we do things. You know, it will cost some jobs, it will create jobs. Net net, I think it’s a positive thing.
02:40 Speaker A
If I’m an investor, I’m listening to this and I have to, okay, so is is the bet, you say ultimately, ultimately long-term, yes, there is going to be material revenue and margins made off made off all this AI investment and spending we’re seeing.
03:00 Speaker B
Uh, I would say the short answer is yes, but will every company be that people are investing in or betting on, will they make it? Not everyone’s going to make it.
03:13 Speaker A
Pick your spots.
03:14 Speaker B
Correct.