Bloomberg Intelligence Bonus Episode: What Is DeepSeek and Why Is It Sinking Stocks?
Jan 27, 2025
Hosts discuss the disruptive rise of the Chinese AI startup DeepSeek and its impact on global tech stocks. The conversation highlights DeepSeek's cost-effective model that raises questions about the inflated valuations of giants like Nvidia. With U.S. tech dominance at stake, analysts express concerns over market volatility and possible overinvestment in AI. The episode emphasizes a shift in competitive dynamics, revealing how emerging technologies could reshape investor perceptions and stock performance in the sector.
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DeepSeek's Impact
- DeepSeek, a Chinese AI startup, is impacting U.S. tech stocks.
- Their cost-effective AI model runs on less-advanced chips, challenging NVIDIA's valuation.
DeepSeek's Cost Advantage
- DeepSeek's model uses similar technology to OpenAI but at a lower cost.
- This raises questions about the high valuations of U.S. tech stocks fueled by AI investment.
AI Investment Concerns
- The high valuations of tech companies are linked to their AI investments.
- DeepSeek's cheaper model questions the necessity of such high investments.