The US chip manufacturer has had more than $550bn (£433bn) wiped from its value since the sellers got to work and blew the top off its Thursday peak. That’s a more than half-trillion-dollar dive, and the biggest three-day value loss for any company in history.
To put that in context, Britain’s top three most valuable companies – drugs giant AstraZeneca, oil major Shell and international banking group HSBC – are worth a combined £500bn, just a little bit more than has been shaved from Nvidia’s market value over a couple of days. Is this, then, a sign of an AI bubble popping? Time to run for the cover of something nice and safe and boring like, perhaps, HSBC, or another toobig-to-fail bank with solid earnings and regular dividend payments?
Perhaps we can learn a few lessons from history. One of the most famous examples of a bubble – that is, a surge in price without regard to the underlying earnings or true value of an asset – came in the late 1990s, when unwary investors had jumped into anything with a dotcom label. Some of those among the Brit contingent would pump out results boasting of their page impressions rather than the revenue they had earned.
This story is from the June 26, 2024 edition of The Independent.
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This story is from the June 26, 2024 edition of The Independent.
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