“A lot of investors have no clue what they are investing in,” Broadcom chief executive Hock Tan warned this week, saying they set “very extreme expectations” only to discover that the AI trade resembles a casino.
The comments were unusually forthright, although a few critical remarks would not normally be enough to send shares in mega-cap technology giants such as Samsung (down 7.4 per cent on the day) and SK Hynix (down 10.1 per cent) tumbling.
In truth, there was more to the declines than Tan’s comments, with concerns about Chinese competition, the sustainability of AI spending and Samsung’s latest earnings report all weighing on the sector, but the swings certainly highlighted the fragility of AI-related sentiment.
Meanwhile, Tan’s reference to “very extreme expectations” may have been aimed at investors, but extraordinary expectations of AI are apparently evident elsewhere in the industry. Shyam Sankar, chief technology officer of data analytics giant Palantir, claims some AI researchers have taken up smoking to signal their conviction that artificial intelligence would eventually cure cancer – an example, he said, of the “mass psychosis” and “social delusion” around AI.
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Then there is Anthropic, which is moving to prohibit sustained cruelty towards its Claude chatbot, despite the absence of evidence that the software experiences suffering.
Clueless investors with extreme expectations are one thing, but researchers smoking in anticipation of a cure for cancer and developers worrying about a chatbot’s feelings suggest the AI boom is acquiring some distinctly unusual characteristics.
