Has DeepSeek burst the US tech bubble?

[ChiBitCTy]

Nvidia and all of the chips stocks have been all over the place this past year.  I KNEW that I should have bought put options on NVDA or just the broad semiconductor market as a whole.  Not that I don't believe that there is still a ton of upside to be had, I just think that the market is over bought as people think that "AI" is "AGI", which it is not, and this whole AI revolution is extremely overblown.  It's actually something that drives me insane.  But the chinese always act like they've created some new breakthrough tech, does not concern me in the least.

[STT]

That is far from being the bursting of a supposed bubble.

It is important to define the difference because harsh set backs can still be a place to be bullish and even more so at the lower price.  The main thing to decide is the defining technology valid, developing and subject to future improvements giving genuine growth.

  Bitcoin is no stranger to gigantic setbacks in price but also sometimes its usage has been difficult especially in countries its been banned yet it keeps going and is stronger every year in my opinion.  That is the basis for bullish trends and to direct the price to your advantage but not be directed by it running from the  market moves in fear.
  Same goes now for AI, it is something incredible and yet I believe genuine with growth hence I remain bullish even while price is highly debatable.

[Free Market Capitalist]

That is far from being the bursting of a supposed bubble.

It is important to define the difference because harsh set backs can still be a place to be bullish and even more so at the lower price.  

Of course, the question here is whether this is a simple set back and was just a false alarm or was the beginning of the bubble bursting. To me at the moment it looks like the former. It looks like DeepSeek was a bluff, no matter how much people who have a grudge against the US are trying to see this as the beginning of the end of the US economy.

See this article for example:

Arm’s CEO on the future of AI and why he does not fear DeepSeek

And Nvidia stock has not stopped recovering.

[retreat]

Even when deepseek is not launched, any company with advanced AI technology with much lower capital will also be able to trigger how the shares of these big companies drop, because from the beginning the shares of these companies have been bubbles and are only waiting for one trigger to burst - and Deepseek at that time came as the company that triggered it. And from the information I read that China has indeed been preparing for this for several years, and now is the time for their companies to come out as challengers to these big companies, and that might be a good thing for the growth of the AI ​​industry.

[Smack That Ace]

also, the news was kinda misleading when they say they developed the LLM with just few millions of dollars that's not actually true, just calculate the price of H800 and how much H800 they have to train the AI, the news only calculate GPU hours only.

Even the actual cost of developing DeepSeek was much higher than their report but if compared to OpenAI, it was still many times more economical and cheaper. This shows that the US AI sector is overhyped and overvalued compared to its actual value.

Additionally, the emergence of DeepSeek is timely as it will create competition and break OpenAI's monopoly. This will benefit us as consumers as we will have more choices and be able to buy products at real value instead of paying too much for exclusive and hyped products.

[Kavelj22]

This is clearly one of the things that is indeed quite interesting where looking at the losses generated, we clearly realize that this seems to illustrate that China is starting to want to slap the US with the technology they created.

This war on technology did not start with Trump, and the declared policies have nothing to do with what is happening behind the scenes. China is preparing cryptocurrencies at the same time that it was a pioneer in the field of mining and still controls a large part of it since it manufactures the devices used for mining. The US is exerting a lot of pressure on the crypto sector, but it owns a significant amount of Bitcoin that it obtained from confiscations in cybercrime operations. Trump is today more daring to express this conflict, supported by the crypto community, from which he himself did not expect to receive such support.

[justdimin]

also, the news was kinda misleading when they say they developed the LLM with just few millions of dollars that's not actually true, just calculate the price of H800 and how much H800 they have to train the AI, the news only calculate GPU hours only.

Even the actual cost of developing DeepSeek was much higher than their report but if compared to OpenAI, it was still many times more economical and cheaper. This shows that the US AI sector is overhyped and overvalued compared to its actual value.

Additionally, the emergence of DeepSeek is timely as it will create competition and break OpenAI's monopoly. This will benefit us as consumers as we will have more choices and be able to buy products at real value instead of paying too much for exclusive and hyped products.

What are you expecting from a Chinese company. I mean to think that Chinese government has nothing to do with it? Their entire national goal is to make it look like "we are not even trying and still doing better stuff than you", and yet they have not built anything better than anyone ever, they just do the cheaper version, that's literally all they do.

And to be fair, since most of the world isn't rich, the cheaper option (if good enough) is the way we all go anyways. I never bought any Chinese brands before, I am sure I bought many stuff that was "made in china", but never owned anything that is Chinese owned, so I am quite happy with the quality of products I have. It's like preferring BYD over Tesla, sure it might be cheaper, but it's also worse.

[WillyAp]

Of course, the question here is whether this is a simple set back and was just a false alarm or was the beginning of the bubble bursting. To me at the moment it looks like the former. It looks like DeepSeek was a bluff, no matter how much people who have a grudge against the US are trying to see this as the beginning of the end of the US economy.

The differences of percentage in crashes and catastrophes between 1907, 1929 and 2008 are huge

1907

1929

and

2008

[Smack That Ace]

...

What are you expecting from a Chinese company. I mean to think that Chinese government has nothing to do with it? Their entire national goal is to make it look like "we are not even trying and still doing better stuff than you", and yet they have not built anything better than anyone ever, they just do the cheaper version, that's literally all they do.

And to be fair, since most of the world isn't rich, the cheaper option (if good enough) is the way we all go anyways. I never bought any Chinese brands before, I am sure I bought many stuff that was "made in china", but never owned anything that is Chinese owned, so I am quite happy with the quality of products I have. It's like preferring BYD over Tesla, sure it might be cheaper, but it's also worse.

As a consumer, the only thing I care about is the market becoming more competitive because that will benefit the consumer instead of being monopolized and inflated just for the benefit of the producer. I don't care what country the company or product is from as long as the quality matches the value it brings, and I don't take sides and don't like to worship or idolize any company or country because it doesn't benefit my pocket.

By the way, if you have never used products from China, try their domestic products and you will know how good their quality is. Don't be quick to judge or evaluate them when you have never used any of their domestic products. Feel for yourself instead of just listening and being led by the media.

[shinratensei_]

also, the news was kinda misleading when they say they developed the LLM with just few millions of dollars that's not actually true, just calculate the price of H800 and how much H800 they have to train the AI, the news only calculate GPU hours only.

Even the actual cost of developing DeepSeek was much higher than their report but if compared to OpenAI, it was still many times more economical and cheaper. This shows that the US AI sector is overhyped and overvalued compared to its actual value.

Additionally, the emergence of DeepSeek is timely as it will create competition and break OpenAI's monopoly. This will benefit us as consumers as we will have more choices and be able to buy products at real value instead of paying too much for exclusive and hyped products.

can't deny with that, indeed they've made LLM development seems a lot cheaper, even the API is several fold cheaper than what offered by OpenAI.
but I could only see this as a good news since this means training even bigger parameter LLM in the future will be viable and cheaper as well using deepseek method since they are opensource.
I mean, nvda is some kind of bubble knowing the valuation of the company has multiplied with their GPU, so it's very normal that their price and other tech stock price is going down.

[Free Market Capitalist]

The differences of percentage in crashes and catastrophes between 1907, 1929 and 2008 are huge

Yes, that's why I say. I think that when the downturn happened it made sense to consider whether it would be the beginning of a bursting of the supposed bubble, but the way things are going, I increasingly believe that it is not. This sounds to me like when Alibaba was said to be going to overtake Amazon and other similar situations.

On a related note, did anyone hear about Vance's visit to the EU yesterday?

Vance tells Europeans that heavy regulation could kill AI

Let's see if they get their act together and stop making a fool of themselves.

[redwine49]

also, the news was kinda misleading when they say they developed the LLM with just few millions of dollars that's not actually true, just calculate the price of H800 and how much H800 they have to train the AI, the news only calculate GPU hours only.

Even the actual cost of developing DeepSeek was much higher than their report but if compared to OpenAI, it was still many times more economical and cheaper. This shows that the US AI sector is overhyped and overvalued compared to its actual value.

Additionally, the emergence of DeepSeek is timely as it will create competition and break OpenAI's monopoly. This will benefit us as consumers as we will have more choices and be able to buy products at real value instead of paying too much for exclusive and hyped products.

can't deny with that, indeed they've made LLM development seems a lot cheaper, even the API is several fold cheaper than what offered by OpenAI.
but I could only see this as a good news since this means training even bigger parameter LLM in the future will be viable and cheaper as well using deepseek method since they are opensource.
I mean, nvda is some kind of bubble knowing the valuation of the company has multiplied with their GPU, so it's very normal that their price and other tech stock price is going down.

it's also the chinese side knew how to make money in another else like stockmarket.
some of them may short the us market before announcing deepseek to go opensource.

[bubilas]

DeepSeek is a neural network that was introduced to the world at a time when certain people were able to profit from the fall of Nvidia shares and other sectors. The fall was like ripples on the water and affected all markets, including cryptocurrencies. But in reality, it turned out to be a leaky AI in terms of security, which, although it thinks quickly, constantly sends all the data to its creators. And therefore, it is reasonable that the United States abandoned this AI. Let the Chinese themselves write that they will actively use it everywhere. This is a bubble, and I would expect Nvidia shares to rise again against the backdrop of the shock.

[Ziskinberg]

No country is like china country and China is at the top in technology because that could did hard work in technology and they made many app which are giving service to the users and their makers are getting royalty on that . Deepseek is good technology and we will see more development in the tech and that is not surprising but that should be for the all countries and there should be top class developers all over the world which will serve the country. Deepseek can change the trends in the market because there will be huge change in the market.There are many intelligent business owners are develpors are they are developing the apps for the future. There is bright future of AI and it will change the World at all

We might see it that way, but the US sees it differently. Any technology with the potential to disrupt the industry, especially if it's from China, their rival, might be suspected of containing spies that steal user information. Similarly, China bans popular US platforms like Facebook, Twitter, Instagram, and YouTube, so they are the same.. 

[shield132]

That’s the competition right there. The US won’t let China get ahead, especially in terms of technology, because they’re both heavily invested in it. In fact, when it comes to quantum computing, China has reportedly invested even more than the US. The race is intense, and neither side wants to fall behind.

https://itif.org/publications/2024/09/09/how-innovative-is-china-in-quantum/

China claims over $15 billion in public quantum funding, far outpacing the United States. While U.S. private funding is higher, China offsets its private sector shortfall with massive public investment.

I don't know if it's a good thing or a bad thing. I believe that the competition is going to be very high and very tough but I'm more interested in knowing how it will affect people. I'm a UI/UX designer and I've been in this field for a few years, so I'm not afraid of AI because I use AI to speed up my work and have more free time, it's really helping in many aspects but I believe it will be very tough for new people to start IT career. Senior designers hire Junior designers because company demands them, company wants to grow juniors from senior to work on their product but I believe soon there will be no need of junior designers because AI will completely take their place, the market will only be active for seniors and leads.

[WillyAp]

Let's see if they get their act together and stop making a fool of themselves.

Don't think those guys will, haven't they just confirmed the EU president?

Number game:
1907 100 million in 1907 are how much in today's $?
1929 50 Million and how much is that in today's $?
2008 5 Trillion is how much in today's $?

 You see, it is just ceros added, if it weren't for the top congress self imposed no one would even talk about it.  

We might see it that way, but the US sees it differently. Any technology with the potential to disrupt the industry, especially if it's from China, their rival, might be suspected of containing spies that steal user information. Similarly, China bans popular US platforms like Facebook, Twitter, Instagram, and YouTube, so they are the same.. 

They are not the same. China is opposed to mass indoctrination which comes from the likes of Facebook, Twitter, Instagram, Youtube etc.. They are using subliminal messages.

While the US is not minding the stupefaction of their own population for the sake of more $  but minds spying, what is mostly done in the wake of marketing data fetchers

[Kelward]

The consumers are better off for it when huge establishments are outdoing each other for delightful products and services. Naturally the US tech giants will feel threatened if a competition is coming from China, who is their rivals but as a consumer I don't worry much if it's DeepSeeek, or one of the top American AI. What I'm more delightfull about is that I have options to choose from. You just have to respect the Chinese whether you like them or not, they have made productions to become more competitive for Europe and America and affordable for everyone. Household appliances to high techs, their cheaper rates are making many low class who're the majority to patronize their products.

[Swordsoffreedom]

And therefore, it is reasonable that the United States abandoned this AI. Let the Chinese themselves write that they will actively use it everywhere. This is a bubble, and I would expect Nvidia shares to rise again against the backdrop of the shock.

Which US has abandoned Deepseek? According to some news: Apple CEO Tim Cook praised Deepseek and called it an innovation that increases efficiency. Not stopping there, the leading US software technology company Microsoft has also announced that it will integrate Deepseek into Azure AI, their artificial intelligence service . Additionally, they said they will also integrate Chinese AI into the Windows operating system in the future . And I think what's more surprising to you is that these two corporations are investors and partners of OpenAI .  .

By the way, I'm guessing you don't invest and hold any Nvidia stocks, but it's interesting that you care and seem concerned about them.

https://azure.microsoft.com/en-us/blog/deepseek-r1-is-now-available-on-azure-ai-foundry-and-github/

[lizarder]

The tech bubble has been behind the success of Nvidia, the world's most profitable company until MicroStrategy came into play. These companies, many of which have AI projects, have caused a huge demand for hardware that with the success of DeepSeek is now in doubt as to whether it will continue to be needed.

As a result, Nvidia is currently down 17% in today's session, and the Nasdaq is down 3.32%. As you may have noticed it has affected the markets in general and also bitcoin and cryptocurrencies which are also trading down today.

DeepSeek surprised some companies in the US and they even built DeepSeek at a much cheaper cost by its founder and I even heard the sophistication is much better than some of its competitors. This shows how great technology is now and developers will be happy to make some adjustments to their journey, so for competitors it is quite surprising. DeepSeek is free to get this is different from some other AI projects that have to be paid to use.

China is starting to become a competitor in terms of technology and even the cost they need to build something is much cheaper than American companies as their competitors. This has made America upset so by creating DeepSeek they are taking anticipatory steps and maybe we will hear other technologies in the future.

[virasog]

As a result, Nvidia is currently down 17% in today's session, and the Nasdaq is down 3.32%. As you may have noticed it has affected the markets in general and also bitcoin and cryptocurrencies which are also trading down today.

Here is an article on the subject: Why Is DeepSeek Sinking Nvidia Stock?

What do you think about it?

I am not against OpenAI or DeepSeek as more the competition, the better it is for the End user. Previously you have to pay 200$ for using the full version of OpenAI but now even a better model developed made is China is totally free.

Why i think that DeepSeek has not only burst the US tech bubble but it has raised many questions on the supremacy of USA. United States was playing not a fair game by not letting Nvidia to send their latest chips to China so they remain behind in AI, but guess what, with the older chips, they are able to develop a more better AI model in more cheaper price.