Will AI stocks see a 'Minsky moment'?

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AI stocks such as Nvidia (NVDA), have skyrocketed this year, but could a Minsky moment be in store? A 'Minsky moment' 'refers to the onset of a market collapse brought on by the reckless speculative activity that defines an unsustainable bullish period,' according to Investopedia. Investopedia Editor-In-Chief Caleb Silver joins Yahoo Finance Live to discuss. “I don’t think we've seen” a Minksy moment in AI, Silver says, “we’ve seen a nice healthy pullback after a really strong rally.” Investors are “worried we might be at the brink of something. Well, there’s really nothing to suggest that we are, except that psychological scar tissue of the fact that we’ve had two bear markets in the past two and a half years,” Silver adds. Silver says, “when we think about AI, the big question is, is all the hype priced into these stocks?” Silver notes that Nvidia has “a pretty healthy price-to-sales ratio and healthy but I mean, very big. But Nvidia’s got a lot going for it, it doesn’t just surround itself in the AI ecosystem.” “We’ve seen a big selloff in AI-related stocks lately, absent Nvidia... so some of the air may have been let out of the AI bubble a little bit and we're going to see which companies remain that have the most strength in that area and can use it to enhance their businesses and their profitability,” Silver explains.

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