Know Your Risk Podcast The Risks of Overly Optimistic Forecasts
Nov 21, 2025
Zach and Chase explore the dangers of overly optimistic forecasts in financial markets. They argue that unrealistic projections can lead to market corrections, especially when ignoring economic fundamentals. A deep dive into NVIDIA reveals that actual customer ROI matters more than flashy quarterly results. They discuss the bubble risks in hyperscaler CapEx, investor psychology, and the potential pitfalls of inflated valuations. The conversation also touches on the impact of AI on the job market and the sustainability of tech investments.
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NVIDIA Results Don’t Disprove An AI Bubble
- NVIDIA's strong quarter doesn't prove AI isn't a bubble; customer ROI will.
- The bubble shows up in hyperscaler capex, not Nvidia's revenue alone.
Hyperscaler CapEx Is The True Stress Point
- The real test is whether hyperscalers can afford and earn back massive AI capex.
- If capital dries up, hyperscaler orders vanish and the apparent demand collapses overnight.
Shorting Bubbles Feels Like Market Manipulation
- Zach recounts being unable to short Tesla for years because bubbles defy rational trading.
- He notes investors expect assets to trade rationally once they take a position, but bubbles ignore that.