Big headline on CNN/Business today:
A shocking Chinese AI advancement called DeepSeek is sending US stocks plunging
US stocks were set for a steep selloff Monday morning after a surprise advancement from a Chinese artificial intelligence company, DeepSeek, threatened the aura of invincibility surrounding America’s technology industry.
DeepSeek, a one-year-old startup, last week showed off a stunning capability: It presented a ChatGPT-like AI model called R1, which has all the familiar abilities, operating at a fraction of the cost of OpenAI’s, Google’s or Meta’s popular AI models. The company said it had spent just $5.6 million training its newest AI model, compared with the hundreds of millions or billions of dollars US companies spend on their AI technologies.
That sent shockwaves through the tech sector Monday. Meta last week said it would spend upward of $65 billion this year on AI development. Sam Altman, CEO of OpenAI, last year said the AI industry would need trillions of dollars in investment to support the development of in-demand chips needed to power the electricity-hungry data centers that run the sector’s complex models.
Don’t be so sure. When it comes to Communist China, they have a history of being misleading on money matters, and, in fact, anything they can mislead. Remember their 6% economic growth a few years back, that later turned out to be questionable at best? In a country where Mr Mendacity will tell us anything in order to get elected, we’re being awfully credulous about another.
During the Cold War, we learned early on that official Communist Party organ Pravda (translates to Truth) was anything but; it wasn’t truth, but victory at any moral cost, that mattered to the Soviets.
Which is a bit like the Republicans when you put it that way.
Incidentally, if you want some surreal puzzlement with your morning coffee, check out the News associated with Chinese company MicroCloud Hologram., a former, and potentially future, meme stock. Maybe a quantum physicist would nod with understanding, but, to me, and I do read about quantum computing, their PR announcements sounded like utter gibberish. In fact, now I’m wondering if the Chinese are trying to spark another spike in value, which they could then harvest for ready cash.
Its current market cap? $34 million. That’s a zero in today’s community of stocks, when some caps are over a trillion $. Tomorrow?
We’ll see.
