Bezos Calls the AI Bubble

Jeff Bezos made news today, putting his imprimatur on the idea that we’re in an AI bubble, although I think the fact that he’s now sporting a light beard was just as interesting. But that’s just me. Bezos’ declaration—at an Italian tech conference—shows that the idea of a bubble is no longer much of a debate. In fact, it’s pretty much conventional wisdom. Last week, Bloomberg reported that hedge fund manager David Einhorn had warned of the chances “that a tremendous amount of capital destruction is going to come through this cycle” of AI spending.

Our story last week about Mira Murati’s Thinking Machines Lab seems to epitomize, for some observers, the bubble-like nature of things. Bloomberg columnist Matt Levine was not the only observer to quote the story’s citation of an investor describing the “absurd pitch meeting” where Murati said, “We’re doing an AI company with the best AI people, but we can’t answer any questions.” As Bezos said today in Italy, when “people get very excited as they are today about artificial intelligence, for example, is that every experiment gets funded, every company gets funded...the good ideas and the bad ideas. Investors have a hard time in the middle of this excitement distinguishing between the good ideas and the bad ideas and so that’s also probably happening today.”