alt Hacker Newsthey deserve bankruptcy.
Indeed they may, but they will be taking a lot of people's 401k's with them. Does anyone here have a 401k and have they analyzed the portfolio to verify none of the assets are related to the AI companies? In some cases it will not be obvious.
If one owns a standard cap-weighted S&P 500 index fund or a default target-date fund in their 401k then about 30% to 40% of every dollar contributed goes directly to the dominant tech giants driving AI.
I am not a financial expert and this is not financial advice.
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That's the scam, man. The managed funds are the marks in the room.
When I first heard the scheme as a kid[1] -- that my retirement depended on giving my money back to the owners, all in the hope that it will come back to me in fifty years -- my first thought was, "I'm never seeing that money". I signed for the matching contribution and not a cent more -- getting 2 bucks of Funny Money for each buck seemed like a decent gamble. As I got older I started thinking that the system must work, all the grown ups know what they're doing, "it's the responsible thing to do". Etc etc etc. Now, I'm coming back around to my teenage opinions: they're going to figure out a way to take every single cent of my money.
Shit like this makes people into goldbugs and ammo hoarders. Or worse.
[1] My generation had some of the last pension positions, and 401ks were fairly the new thing.
We had that happen in the late 90s/early 2000s with Nortel. Before they collapsed (and infamously devastated their current and former employees' pensions in doing so), Nortel represented a THIRD of the TSX. The TSX responded by capping any individual stock at 10% of the exchange's overall value, with a forced rebalancing in the event that cap is struck.
At this point, that 10% is probably higher than it should be, since it doesn't account for entire extremely-well-funded sectors being caught up in a hype cycle like AI's, the sum of whose component stocks could easily exceed 10%.