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Nvidia Stock Crash Prediction

entropicthoughts.com

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Re: Nvidia Stock Crash Prediction

#211

Post by Der_Einzige »

bmurphy1976 wrote: post #184
aswegs8 wrote: post #162

Earlier quoted context omitted.

Not sure why this "GPUs obsolete after 3 years" gets thrown around all the time. Sounds completely nonsensical.

It's because they run 24/7 in a challenging environment. They will start dying at some point and if you aren't replacing them you will have a big problem when they all die en masse at the same time. These things are like cars, they don't last forever and break down with usage. Yes, they can last 7 years in your home computer when you run it 1% of the time. They won't last that long in a data center where they are run…

With good enough cooling they can run indefinitely!!!!! The vast majority of failures are either at the beginning due to defects or at the end due to cooling! It’s like the idea that no moving parts (except the HVAC) is somehow unreliable is coming out of thin air!

Re: Nvidia Stock Crash Prediction

#212

Post by notyourwork »

MrDarcy wrote: post #207
kortilla wrote: post #181

Earlier quoted context omitted.

They aren’t yet because the big providers that paid for all of this GPU capacity aren’t profitable yet. They continually leap frog each other and shift around customers which indicates that the current capacity is already higher than what is required for what people actually pay for.

Google, Amazon, and Microsoft aren’t profitable?

I assume the reference was AI use cases are not profitable. Those companies are subsidizing and OpenAI/grok are burning money.

Re: Nvidia Stock Crash Prediction

#213

Post by dylan604 »

mikkupikku wrote: post #149
dylan604 wrote: post #86

Earlier quoted context omitted.

>offset buying a new one every one to three years? Isn't that precisely how leasing works? Also, don't companies prefer not to own hardware for tax purposes? I've worked for several places where they leased compute equipment with upgrades coming at the end of each lease.

Who wants to buy GPUs that were redlined for three years in a data center? Maybe there's a market for those, but most people already seem wary of lightly used GPUs from other consumers, let alone GPUs that were burning in a crypto farm or AI data center for years.

> Who wants to buy

who cares? that's the beauty of the lease. once it's over, the old and busted gets replaced with new and shiny. what the leasing company does is up to them. it becomes one of those YP not an MP situations with deprecated equipment.

Re: Nvidia Stock Crash Prediction

#214

Post by Der_Einzige »

zozbot234 wrote: post #208
bmurphy1976 wrote: post #184

Earlier quoted context omitted.

It's because they run 24/7 in a challenging environment. They will start dying at some point and if you aren't replacing them you will have a big problem when they all die en masse at the same time. These things are like cars, they don't last forever and break down with usage. Yes, they can last 7 years in your home computer when you run it 1% of the time. They won't last that long in a data center where they are run…

A makeshift cryptomining rig is absolutely a "challenging environment" and most GPUs by far that went through that are just fine. The idea that the hardware might just die after 3 years' usage is bonkers.

Crypto miners undervote for efficiency GPUs and in general crypto mining is extremely light weight on GPUs compared to AI training or inference at scale

Re: Nvidia Stock Crash Prediction

#215

Post by notyourwork »

Der_Einzige wrote: post #210
lairv wrote: post #114

Earlier quoted context omitted.

NVIDIA stock tanked in 2025 when people learned that Google used TPUs to train Gemini, which everyone in the community knows since at least 2021. So I think it's very likely that NVIDIA stock could crash for non-rationale reasons edit: 2025* not 2024

Google did not use TPUs for literally every bit of compute that led to Gemini. GCP has millions of high end Nvidia GPUs and programming for them is an order of magnitude easier, even for googlers. Any claim from google that all of Gemini (including previous experiments) was trained entirely by TPUs is lies. What they are truthfully saying is that the final training run was done on all TPUs. The market shouldn’t react…

Why should it not react heavily? What’s stopping this from being a start of a trend for google and even Amazon?

Re: Nvidia Stock Crash Prediction

#216

Post by lazide »

pixl97 wrote: post #200
lazide wrote: post #165

Earlier quoted context omitted.

Then you’re dealing with a lot of labor to do the switches (and arrange sales of used equipment), plus capital float costs while you do it. It can make sense at a certain scale, but it’s a non trivial amount of cost and effort for potentially marginal returns.

Building a new data center and getting power takes years to double your capacity. Swapping out out a rack that is twice as fast takes very little time in comparison.

Huh? What does your statements have to do with what I’m saying?

I’m just pointing out changing it out at 5 years is likely cheaper than at 3 years.

Re: Nvidia Stock Crash Prediction

#217

Post by kqr »

esafak wrote: post #175
kqr wrote: post #151

Earlier quoted context omitted.

Fundamental analysis is great! But I have trouble answering concrete questions of probability with it. How do you use fundamental analysis to assign a probability to Nvidia closing under $100 this year, and what probability do you assign to that outcome? I'd love to hear your reasoning around specifics to get better at it.

Don't you need a model for how people will react to the fundamentals? People set the price.

Possibly? I don't know -- hence the question!

GP was presenting fundamental analysis as an alternative to the article's method for answering the question, but then never answered the question.

This is a confusion I have around fundamental analysis. Some people appear to do it very well (Buffett?) but most of its proponents only use it to ramble about possibilities without making any forecasts speciic enough to be verifiable.

I'm curious about that gap.

Re: Nvidia Stock Crash Prediction

#218

Post by josefx »

MrDarcy wrote: post #207
kortilla wrote: post #181

Earlier quoted context omitted.

They aren’t yet because the big providers that paid for all of this GPU capacity aren’t profitable yet. They continually leap frog each other and shift around customers which indicates that the current capacity is already higher than what is required for what people actually pay for.

Google, Amazon, and Microsoft aren’t profitable?

Aren't all Microsoft products OpenAI based? OpenAI has always been burning money.

Re: Nvidia Stock Crash Prediction

#219

Post by kqr »

huqedato wrote: post #176

That's smoke and mirrors. You can't logically predict the market. It never worked.

Sure you can predict the market. Making money off of it beyond the regular risk-adjusted return is what's hard. (And the prediction of this article is indeed based on that assumption.)

Re: Nvidia Stock Crash Prediction

#220

Post by djeastm »

kqr wrote: post #151
_fat_santa wrote: post #11

This article goes more into the technical analysis of the stock rather than the underlying business fundamentals that would lead to a stock dump. My 30k ft view is that the stock will inevitably slide as AI datacenter spending goes down. Right now Nvidia is flying high because datacenters are breaking ground everywhere but eventually that will come to an end as the supply of compute goes up. The counterargument to th…

Fundamental analysis is great! But I have trouble answering concrete questions of probability with it. How do you use fundamental analysis to assign a probability to Nvidia closing under $100 this year, and what probability do you assign to that outcome? I'd love to hear your reasoning around specifics to get better at it.

I think the idea of fundamental analysis that you focus on return on equity and see if that valuation is appreciably more than the current price (as opposed to assigning a probability)
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