Jeremy Grantham expects the AI bubble to “collapse”

Renowned billionaire investor Jeremy Grantham has pointed out the unnatural rise in stocks of artificial intelligence-related companies, Business Insider reports. After the first news about ChatGPT was released, which caused a stir, a 10-month rally began that was only moved by small groups of players. When the quotes rose by 50-70%, the rest of the market participants who were watching lost patience and joined in, the expert noted.

Now there is a feverish demand for chips for AI development, but their customers have little idea what they will do with them, Grantham said, likening the situation to the sale of shovels during the gold rush. That euphoria will be followed by a downturn, he warned.

The investor once again pointed to the "dangerous bubble" that has formed in the real estate market around the world; last fall he recommended refraining from buying it. He also pointed to worsening natural disasters, which he said were undermining humanity's ability to "create wealth."