It is Halloween, so with an intended pun it must be said: spooktacular times in markets and the economy continue.
AI (Artificial Intelligence) is simultaneously spooky and spectacular. Nvidia, this week, reached a new milestone surpassing all other US companies with a $5 trillion market valuation. Nvidia’s market cap is now larger than the largest semiconductor companies AMD, Arm Holdings, ASML, Broadcom, Intel, Lam Research, Micron Technology, Qualcomm and Taiwan Semiconductor Manufacturing combined.*
AI is real and is (in some way) powering everything from ice cream shops to manufacturing lines to healthcare delivery… to all kinds of service providers. In the Federal Reserve’s rate setting meeting which also took place this week, AI was highlighted as both a boost to the economy and a kind of threat to jobs, as companies retool models and adjust the number of human workers – based on those jobs that can be replaced by “smart technology”, a.k.a. “AI”. It is still evident that humans will always be necessary, if not only to invent the technology.
The pace of the AI is spectacular, leading to the word, “bubble” being tossed around often. Bubbles might be what people talk about at cocktail parties to sound like the smartest person in the room. Bubbles are also nearly impossible – if not outright impossible – to predict with any kind of constructive timing or precision. Bubbles, in the afterwards of a “pop” are spooktacular.
To avoid the spooktacular, consider these less spooky tactics:
- Diversify. There is no rule that says – and it is not advisable – to be “all or nothing” with investments, whether by sector, company or asset class.
- Cash is part of an asset allocation. Understand the role of cash in savings and in an investment portfolio. Please ask me more about this point.
- With the caveat that an investment plan is already in place, an investor can choose to do nothing in the face of what might look like a bubble. This is a real choice – as long as professional advice and a plan exist.
*Hannah Erin Lang, WSJ.com. 10/29/2025.
*Consult with a tax professional on ALL tax matters and tax planning.
This material has been prepared for informational purposes only and is not intended to provide, and should not be relied upon for, tax, legal or accounting advice.