Fears of a recession in the United States have brought the great artificial intelligence boom/bubble to shuddering halt.
The Nasdaq has dropped 10 per cent in a few weeks, the AI favourite Nvidia is down 20 per cent and on Friday, Intel, the incumbent chip maker fell 26 per cent, in one day.
On Friday it emerged that US unemployment had risen to 4.3 per cent in July, satisfying what is known as the Sahm Rule for identifying a recession: That is, a 0.5 per cent rise in the jobless rate from the low point (which was 3.5 per cent).
And over the weekend it emerged that Warren Buffett had sold half of Berkshire Hathaway’s $US150 billion stake in Apple, and had built a defensive cash pile of $US277 billion.
Are we about to relive March 2000? That’s when the dot.com bubble burst, and the Nasdaq fell 77 per cent over two and a half years, causing a nasty recession.
I don’t know about that, but in the long term it doesn’t matter.
The collapse of the dot.com bubble did not end the internet, or stop American tech innovation – quite the reverse.
The thing about any stockmarket bubble and bust is that a lot of investors lose money but the companies that harvested it get to keep it, and use it to develop products.
Apple’s iPod was released in 2001 and the Blackberry smartphone a year later. In 2007 Steve Jobs put them together into the iPhone and changed the world.
What will come out of the latest tech bubble and change the world?
Answer: Humanoid robots, combining AI with machines that look like, sound and behave like humans.
When I played around with a science-fiction novel on long service leave a few years ago,........