00:00 Speaker a
Have we witnessed another tech stock bubble? This was placed in Torten Sloak, Apollo's chief economist. This is what he said.
00:09 Torsten Sloke
We think we've grown a lot, but it seems somewhat extreme that the valuation of the S&P 500's key big stocks, which make up such a big share of the S&P 500, is at a very high level compared to the IT bubble, where the valuation of the 10 big companies in S&P are much lower. So, these companies are so expensive and so concentrated for investors that buying the S&P 500 is not really diversified, so I think there's a bubble from a PE ratio perspective.
00:56 Speaker a
Okay. Still with me is my roundtable Chad Morganlander, Washington Crossing Advisor and senior reporter at Yahoo Finance, Alexandra Canal. And Ines Ferret. Chad, to you about this. I don't know if he's in the bubble until after the fact, right?
01:10 Chad Morgan Lander
Yes, right. And in fact, uh, you, your clip was right. Well, you're sitting 23 times. So you are in the early stages of the bubble. You need to remember that living throughout the 90s and gaining S&P revenue or PE multiples over 30 times. But in the long run, this excitement about artificial intelligence will be justified over the next 10-15 years. It's a question of valuation gaps, where those valuation gaps meet, um, the reality of revenue.
02:15 Speaker a
Well, Chad, if you want to compare it to the internet fads, then at least from a PE perspective, we should still go more from an evaluation perspective.
02:24 Chad Morgan Lander
Well, that might be true. Um, again, buyers should be aware of the type of company you are purchasing. Well, at Washington Crossing Advisor, I own the alphabet, for example. It is traded at about 17 times multiples when you see, when you take cash, when you see, when you see, when you see. Well, full disclosure, owned in a portfolio, not only personally owned. But the company has a perfectly competitive stack to oppose Openai.
03:03 Speaker a
INES, I haven't covered a good bubble for a while. Well, the last thing I featured was cannabis from a few years ago. Every day, cannabis strains rise until you do it. Maybe it's time, um, we're bursting bubbles, and maybe it's starting with AI.
03:24 Innes Ferre
And we certainly did. Well, this is probably not like cannabis. Because they are exposed to all kinds of industries. So, if you're looking at the various sectors of the S&P 500 right now, you're looking at industrialists, so that's leading the way. Think big construction, factories, AI centers. Well, you're looking at technology. You can see the utility. This is usually the sleepy part of the market. Utilities outperform the broader market. And of course you are looking at finances too. So now we see that we are touching on every part of the market. And in the future, like what Chad had said before, um, um, look, in the long run, this will be a huge productivity boom for the economy as a whole. Um, imagine an endless amount of AI bots working for you. And this is not just about AI bots, but about doing everything later on to robots. So this would be a massive, large-scale productivity move. But yes, we might be in the bubble right now. We'll see it contract, but then we'll see, uh, exponential growth.
05:03 Speaker a
Immediately, ines. You need 1000 personal digital assistants. thank you. thank you. And I'm going to get them for AI one day.
