00:00 Julie
The Alphabet NVIDIA divergence really has been an interesting story. And even though it sort of burst into the fore over the past couple of days, it’s been happening really, it’s been building over the past month or so.
00:15 Speaker B
Yes, and let’s go back to the Wi-Fi interactive here where I do have NVIDIA versus Alphabet. And this is a year-to-date chart and what you can see is their fortunes were pretty tied together. Here’s that post-liberation day April low, and then we went up, and then NVIDIA really started going sideways after July, and it made a little spike, but it came down here. What you really see, where you really see the divergence is in the last few weeks. And uh if you quote if if you start this uh chart at the beginning of that April bottom, you really see the outperformance of Alphabet. It’s up 123% since then. NVIDIA up 85%. I think investors should be ecstatic about that. That’s all in great. But there’s another divergence I just want to point to and that is in uh that Nasdaq 100. So, uh some of the biggest stocks in the Nasdaq versus Bitcoin. And here we go again versus that April low. Um the Q’s as they call them, that’s the Nasdaq 100, is up 46%, but Bitcoin really started selling off earlier than everything else in October and it’s been kind of a risk barometer for me. It just hasn’t been able to really uh accelerate on the days when the general market has. So, I’m keeping a close eye on that divergence as well, Julie.
01:22 Julie
I’m and, you know, we it looks like NVIDIA is keeping a close eye on that divergence too, which is maybe a little bit unusual here. Uh, Dan Howley, um, yesterday, I thought it was pretty remarkable to have NVIDIA tweeting, hey, good for you, Google. Good for you that you’re getting, uh, traction here for your TPUs and getting that, uh, reportedly getting that meta contract. I mean, what did you make of that and what do you make of this kind of like split that we’re seeing in the stocks?
01:52 Dan Howley
Yeah, I thought that was interesting. I thought the uh the note that they had sent out uh to analysts was was interesting. Basically, you know, trying to cut into all arguments against NVIDIA itself, whether that was the circular investing or, you know, accusations that it’s a an Enron or or, you know, a Worldcom or something along those lines. Uh basically shooting all of those down, uh talking about the the depreciation of some of their their chips and, you know, Michael Bury uh basically saying that, you know, Meta and Oracle and and says others but hasn’t mentioned what other companies, but that they’re uh extending the uh the lifeline uh lifetime of their chips uh and so they’re artificially inflating their revenue and NVIDIA said even during their their most recent earnings call, uh that look their chips can last quite a long time uh and so some companies are are still using their A100 chips and just, you know, that that those are very old chips, you know, when you consider how fast these things move. Uh and so, you know, it was interesting to see NVIDIA come out uh and say, look, you know, as you basically said, good for you, Google, you know, pat on the back, our stuff’s still better. Um this is this conversation that has been going on and if, you know, I I’ve been to a number of NVIDIA conferences, sat in, you know, a number of rooms with Jensen and, you know, he’s regularly asked about uh these ASIC or, you know, what what NVIDIA calls its Turner process uh uh tensor processing unit, excuse me. Uh they’re a form of ASIC. It’s a um application specific uh integrated circuit. And so basically it’s it’s a chip that that can run these AI applications but it’s not as general purpose as something that NVIDIA has. Uh and so the the tradeoff there being that because they’re application specific, they can be more efficient. NVIDIA basically says, look, our stuff is still better, it’s still faster, and we’re getting more efficient as time goes on. And so, you know, it it’s going to be this, I think this continued back and forth. Um, you know, it it could be a function of NVIDIA just controlling so much of so much of the market uh when it comes to these chips that the kind of, you know, it brings in the worry of, well, are they really that good? Are they not? But again, I I think, you know, we’ve spoken about this before about how sure, their customers have been doing this for a while. This is not new that Google has its TPUs. It’s not new that Meta is working on its own chips, Microsoft, Amazon, this is all been happening for years at this point.
