
Former Google CEO Eric Schmidt says AI is not a bubble, but a whole new industrial structure
While there is plenty of curiosity and hope, many are questioning whether AI is being overhyped, and whether it might face the same fate as the dot-com era, potentially triggering a market crash. At that time, the internet was seen as a revolutionary technology, prompting investors to pour money into internet companies in anticipation of massive future profits. However, by 2000–2001, with few profits in sight, the bubble burst and it wiped out trillions in value.Apollo Global Management's chief economist, Torsten Slok, recently warned that the current AI surge may represent an even larger bubble than the dot-com era. 'The top 10 companies in the S&P 500 today are more overvalued than they were in the 1990s,' Slok wrote in a note published on Wednesday.In contrast, Schmidt points to the hardware demands of AI as a sign of its long-term viability. 'You have these massive data centres, and Nvidia is quite happy to sell them all the chips,' he said in Paris. 'I've never seen a situation where hardware capacity was not taken up by software.'No overcapacity, limited by electricitySchmidt acknowledges that many are concerned about 'overbuilding' and the risk of 'overcapacity in two or three years.' However, he sees this more as a normal cycle of ups and downs, rather than evidence of an impending collapse. 'That's a classic bubble, right?' Schmidt quipped, referring to those who believe their own firms will survive while others fail. 'If you believe that those are going to be the defining aspects of humanity, then it's under-hyped and we need even more,' he added.advertisementMeanwhile, Schmidt has also addressed the challenges of AI and what he believes could be the biggest obstacle to building superintelligence. In a recent episode of the Moonshots podcast with Peter Diamandis and Dave Blundin, Schmidt identified electricity — not chips or money — as the true limiting factor for AI's progress. 'AI's natural limit is electricity, not chips,' he said, warning that the US may need an additional 92 gigawatts of power to support future AI infrastructure.In a LinkedIn post, he wrote: 'It is reasonable to predict that we are going to have specialised AI savants in every field within five years. Now imagine their capabilities and how they will change society and our day-to-day lives.'- Ends
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Economic Times
17 minutes ago
- Economic Times
US stock market rallies as S&P 500 and Nasdaq hit fresh records amid earnings boom and Fed rate cut hopes
U.S. stock markets continued their upward climb on Friday, July 25, 2025, as the S&P 500 and Nasdaq Composite pushed into new record territory, while the Dow Jones hovered just below its all-time highs. Investors remain bullish, fueled by a powerful combination of strong corporate earnings, renewed optimism over potential Federal Reserve rate cuts, and positive sentiment around upcoming U.S. trade deals. As tech and AI-related stocks maintain their momentum and inflation cools further, Wall Street seems to be riding a wave of cautious confidence. U.S. Stock Market stays positive amid strong earnings and fed speculation- On Friday, July 25, 2025, U.S. stock markets continued their upward momentum, with the S&P 500 and Nasdaq Composite inching further into record-high territory. The Dow Jones Industrial Average, while not yet setting a new record, also showed modest gains, supported by investor optimism surrounding strong corporate earnings, easing inflation, and increasing speculation about a potential Federal Reserve interest rate cut. This continued bullish sentiment reflects a combination of solid economic data, corporate performance that's exceeding expectations, and a supportive policy environment. Investors appear more willing to bet on equities, especially as tech giants and AI-driven companies continue to outperform. The S&P 500 rose about 0.1% to 0.17% , continuing its streak of record closing highs. rose about , continuing its streak of record closing highs. The Nasdaq Composite edged up roughly 0.01% to 0.1% , also hitting fresh all‑time highs. edged up roughly , also hitting fresh all‑time highs. The Dow Jones Industrial Average climbed between 0.16% and 0.2% , but still remained just below its all‑time high. climbed between , but still remained just below its all‑time high. Intel shares dropped significantly, dragging on Dow performance despite broader market strength. significantly, dragging on Dow performance despite broader market strength. Strong earnings from roughly 80% of S&P 500 companies helped fuel investor confidence. from roughly 80% of S&P 500 companies helped fuel investor confidence. Tech and AI stocks—including big names like Alphabet and Nvidia—led the gains. Both the S&P 500 and Nasdaq Composite have been grinding out small but consistent gains throughout the week, and Friday followed suit. The S&P 500 added around 0.1% to 0.17%, while the Nasdaq Composite hovered just above the flatline, up by about 0.01% to 0.1%. These small advances may not seem headline-worthy, but they have kept both indexes in record-breaking mode, notching up the longest streak of all-time closing highs since December. This quiet but persistent climb reflects underlying confidence in the U.S. economy, earnings season resilience, and a hopeful outlook on interest rate adjustments. The Dow Jones Industrial Average, which slipped by 0.7% on Thursday, rebounded slightly on Friday morning, rising about 0.16% to 0.2%. Although still just shy of its all-time high, the Dow's recent movements suggest stability amid corporate turbulence. A key reason the Dow is lagging slightly behind its peers is the sharp drop in Intel shares, which tumbled over 6% to 8% after the chipmaker reported a surprise quarterly loss and announced planned job cuts. Intel's performance weighed on the Dow but had less impact on the broader market indexes like the S&P 500. A major catalyst behind the current stock market rally is the performance of technology and AI-driven stocks. Companies like Alphabet (Google) and Nvidia have played a crucial role in propping up the S&P 500 and Nasdaq Composite. The widespread enthusiasm around artificial intelligence continues to fuel investor appetite, especially with businesses across sectors ramping up their investments in AI tools, chips, and platforms. Nvidia's continued dominance in the GPU space, along with Google's strong cloud and AI integration, signals a tech-fueled growth cycle that's far from over. Another key driver of the bullish market trend is a better-than-expected earnings season. So far, approximately 80% of companies listed on the S&P 500 have beaten analyst expectations for second-quarter earnings. Positive surprises from consumer goods makers like Deckers Outdoor and healthcare players such as Edwards Lifesciences have reassured investors that inflation pressures are not eroding corporate profitability as feared. Earnings reports have also shown that many companies are managing to maintain margins, cut costs, and adapt to new consumer behavior trends in a high-interest-rate environment. As broader markets showed strength, one stock that clearly stole the spotlight was GE Vernova (GEV)—today's top-performing stock across the S&P 500. GE Vernova delivered an impressive earnings report, posting $1.73 per share , a dramatic rise from just $0.08 last year. , a dramatic rise from just last year. The company's $9.1 billion in revenue beat expectations and highlighted strong growth across its energy and grid technology divisions. beat expectations and highlighted strong growth across its energy and grid technology divisions. GE Vernova secured 9 gigawatts of new project contracts this quarter, cementing its position as a rising energy infrastructure leader. this quarter, cementing its position as a rising energy infrastructure leader. Management raised the full-year revenue forecast to $36–$37 billion and increased the outlook for free cash flow , giving investors even more reason to stay bullish. and increased the outlook for , giving investors even more reason to stay bullish. With shares now up over 90% year-to-date, GE Vernova is rapidly becoming one of Wall Street's favorite plays in the AI-powered energy transformation. One of the most watched developments in recent weeks has been the Federal Reserve's evolving stance on interest rates. Speculation is mounting that the Fed could begin cutting rates as early as September, especially as inflation continues to cool and economic growth remains stable. Fed officials have been sending mixed but increasingly dovish signals, suggesting they are open to adjusting policy if inflation shows further signs of slowing. President Donald Trump's recent comments, urging the Fed to "do what's necessary" to maintain economic momentum, have also added pressure on central bankers. Lower interest rates would not only support consumer and business borrowing but also make equities more attractive relative to bonds, further supporting the ongoing stock market rally. Markets also found support from positive trade developments, particularly with key trading partners like Japan, the Philippines, Indonesia, and the European Union. As the August 1 deadline for new trade agreements approaches, expectations are high that the U.S. will finalize deals that benefit manufacturing, tech, and agricultural sectors. Investors are optimistic that these agreements could ease global supply chain pressures, reduce tariffs, and enhance export opportunities for U.S. firms. This sense of forward-looking trade optimism is helping keep markets steady even amid short-term uncertainties. With Friday's modest but solid gains, all three major U.S. indexes are heading toward their fourth positive week out of the past five. This trend reflects sustained market momentum, especially as new money continues to flow into equity markets from both retail and institutional investors. The S&P 500's climb, in particular, has impressed analysts, with many noting how it has managed to break records without relying on large, volatile daily swings. Instead, it's been a gradual, fundamentally supported rally—something market bulls see as a sign of long-term strength rather than a short-term bubble. Here's a quick look at the current performance of the major U.S. stock indexes as of Friday, July 25: Index Movement Trend Status S&P 500 +0.1% to +0.17% Multiple daily record closes New all-time high Nasdaq +0.01% to +0.1% Flat to modest gains, still record New all-time high Dow Jones +0.16% to +0.2% Stabilizing after Intel-led drop Near record, not yet breached As we move into the final week of July, investors are watching several key developments: More earnings reports from tech and consumer giants like Apple , Amazon , and Procter & Gamble from tech and consumer giants like , , and Further clarity on the Federal Reserve's interest rate path Finalization of international trade agreements Ongoing developments in AI, chip manufacturing, and data security July jobs data and new inflation reports that may guide rate cut decisions Markets may remain relatively calm in the short term, but any surprise—positive or negative—on these fronts could drive volatility. For now, though, the prevailing trend points to cautious optimism, backed by solid fundamentals and investor U.S. stock market is navigating a sweet spot of strong earnings, hopeful Fed signals, and tech-driven growth. As long as inflation remains in check and policy supports expansion, the path of least resistance may continue to be upward. Q1: Why is the US stock market hitting new records now? Strong earnings, AI stock growth, and Fed rate cut hopes are pushing it higher. Q2: What's keeping the Dow Jones from reaching a record? Intel's weak earnings and job cuts slowed down the Dow's momentum.


Time of India
17 minutes ago
- Time of India
Tesla plans to launch Robotaxis in San Francisco this weekend
Tesla is preparing to launch its robotaxi service in San Francisco as soon as this weekend, Business Insider reported on Friday, citing an internal staff memo. The company's robotaxi business is still in its early stages, having only conducted a controlled test run in Austin, Texas, earlier this year. The geofenced area where the robotaxi service will operate covers a large swath of the Bay Area, including Marin, much of the East Bay, San Francisco and stretching south to San Jose, the report said. The launch timeline has been moved up to as early as Friday and some Tesla owners will receive invites to use the service, according to the report. CEO Elon Musk has shifted Tesla's focus toward robots and self-driving taxis to counter declining sales for the electric automaker's aging vehicle lineup. Meanwhile, The Information reported that Tesla is well behind the pace necessary to meet Musk's goal of producing at least 5,000 of its Optimus humanoid robots this year, having made only a few hundred of them. Reuters could not independently verify the Business Insider and Information reports, while Tesla did not immediately respond to requests for comment on the reports. During the earnings call this week, Musk said Tesla is getting regulatory permission to launch robotaxis in several states, including California, Nevada, Arizona and Florida. California regulators told Reuters on Wednesday Tesla had not yet applied for permits needed to pick up and charge passengers for rides in fully autonomous vehicles. Companies need a series of permits from the California Department of Motor Vehicles and the California Public Utilities Commission to test and deploy autonomous vehicles in the state. The DMV and CPUC did not respond to requests for comment. Regulatory hurdles pose a challenge to Tesla as it must gain the trust of safety officials before launching fully autonomous services. (


Time of India
29 minutes ago
- Time of India
Elon Musk's Tesla sends memo to staff; says Robotaxi service may launch in San Francisco next week: Report
Elon Musk-owned Tesla is planning to launch its robotaxi service in San Francisco next week, reports Business Insider citing an internal staff memo. As per the report, the EV maker said that its timeline for the launch has been moved up and the service could launch as soon as Friday, i.e. August 1. According to the memo, the geofenced area where Robotaxi service will operate will cover a large part of the Bay Area , including Marin, much of the East Bay, San Francisco, and stretching south to San Jose. Robotaxi service in San Francisco will initially launch with safety drivers in the driver's seat who will be able to control the car using the steering wheel and brakes, the memo said. A Business Insider report states that the California Department of Motor Vehicles (DMV) records show that Tesla has expanded its autonomous testing activities in the state. As of December, the company registered 224 in-house test drivers and 104 vehicles for testing under its existing permit. The publication reported that the number of workers testing Tesla's software in California has more than tripled. Tesla currently holds a permit that allows testing of its self-driving software in California, but only with a safety driver behind the wheel. It remains unclear whether Tesla will need a separate permit to operate its planned robotaxi service with a safety operator present in the vehicle. The California Public Utilities Commission (CPUC) has granted Tesla a permit to operate a transportation service for employees. However, as of July 10, Tesla had not applied for the necessary permits to offer a commercial robotaxi service to the general public. The Business Insider report further stated that DMV has confirmed the EV company has not applied for a permit to test or deploy driverless vehicles in the state. A DMV spokesperson said the agency recently met with Tesla, but the company has not submitted an application for either testing or commercial deployment of fully autonomous vehicles. Tesla Robotaxi in Austin Tesla launched its invite-only robotaxi service in Austin, Texas last month with around 10 modified Model Y vehicles operating in a geofenced area. Elon Musk said during Tesla's Q2 earnings call this week that initial Bay Area operations will also begin with a safety operator in the front seat. The Tesla CEO also added that Tesla plans to launch the Bay Area service within one to two months and is in the process of obtaining the required regulatory approvals. 7 Reasons that make Samsung GALAXY Z FLIP7 different from others AI Masterclass for Students. Upskill Young Ones Today!– Join Now