People Like Sam Altman and Eric Schmidt Are Calling Out the AI Bubble, Just as Meta Pauses AI Hiring

"Big names in Silicon Valley collectively seem to be saying the same thing abut the AI boom lately, namely that it is looking more and more like a bubble, and that the rush to AGI (artificial general intelligence) may be very misguided. The Wall Street Journal has a report today that Meta's widely buzzed-about AI hiring spree is coming to an abrupt halt, likely due to scrutiny by high-profile investors who are balking at the massive sums being thrown at poached AI researchers and engineers."

"And that tidbit about Meta dovetails with this Bloomberg story about options traders who are bracing for a tech-stock sell-off with "disaster puts," or put options that give investors the right to sell an asset at a specific price if it starts trending down. These traders are reportedly "increasingly nervous about a plunge in technology stocks in the coming weeks and are grabbing insurance to protect themselves from a wipeout.""

"Sam Altman spoke to The Verge reporter Alex Heath and other reporters at a dinner this week saying that yes, investors probably are "overexcited" about AI right now. "When bubbles happen, smart people get overexcited about a kernel of truth," Altman reportedly said. "If you look at most of the bubbles in history, like the tech bubble, there was a real thing. Tech was really important. The internet was a really big deal. People got overexcited.""

Major technology firms are facing increased investor scrutiny that is prompting slowdowns in aggressive AI hiring and costly recruitment deals. Market participants are hedging against a possible tech-stock sell-off by purchasing put options, reflecting nervousness about an imminent downturn. Prominent industry figures caution that investor enthusiasm around AI may be excessive, comparing current sentiment to historical speculative bubbles. Concerns center on the prioritization of artificial general intelligence as a goal, with uncertainty about how soon AGI can be achieved and unease about focusing on that end point now.

Read at sfist.com