Nvidia has been on a magnificent run.
But, as earnings day approached (today), some investors took their profits. Others sold short. The last few days have been hard. Here’s a chart of the last five days:
The last time Nvidia went parabolic, I sold. I was horribly wrong. I had to scramble and buy back in.
So this time, I’m sitting tight. I haven’t sold a nickel’s worth of Nvidia.
This evening I’ll know if that was stupid.
Trying to time the market in good stocks is a fool’s game. I’ve told myself that several expensive times.
Nvidia is a good stock.
I have spent the last ten days trying to figure out how generative AI actually works, how users will use it profitably, and which companies will actually benefit the most from providing it.
This bottoms-up approach is my usual way of picking stocks. Which usually (but not always) works.
I have some early conclusions…
+ Everybody will benefit from generative AI, just as everybody has benefitted from the Internet. If you are a one-man band, or run a big company you ought to look seriously at how generative AI can actually make you and your company more productive. And I mean everyone.
+ I have only the vaguest notion of how generative AI works — except that it uses a lot of NVDA chips and SMCI machines.
+ The usual suspects — i.e. the big tech companies — like Amazon, Meta, Google, Apple, Microsoft, Salesforce, ServiceNow — have the resources, the money and the talent to meld generative in into their product offerings. But it will take time. As an example, check out what Microsoft is doing with Copilot in Office 365, or what it’s now calling Microsoft 365 Copilot. (Consistency in naming is not one of Microsoft’s strong suits).
+ My big hope that generative AI would solve : The horrible call center problem we face every time we buy something, viz.:
I pray the powers that be would make Chatbot useful and save me, the customer, and the company time and money…. I have several examples of companies using generative AI in their call centers and saving themselves money and making their customers happier.
We’ll hear Nvidia’s results tonight. They should be fine. Then we’ll hear the forward guidance. I’m guessing it might not be as ebullient as we’d like. Tech seems to be slowing down.
We’ll see tomorrow morning when trading opens if Harry was an idiot because he didn’t take some of his (admittedly) awesome profits on Nvidia.
Tennis is easier than the stockmarket. See you tomorrow. — Harry Newton
