From the New York Times, I'm Natalie Kittrowaf. This is the Daily.

After years of soaring optimism and massive investment in the AI boom, in recent weeks,

Wall Street has begun to seriously question whether that optimism was overblown,

and whether we're actually in a bubble that may soon pop.

And yet, despite all that hand-wringing, Silicon Valley has only doubled down,

projecting total confidence about the hundreds of billions of dollars it's pouring into the technology.

Today, my colleague Cade Metz explains why, why tech companies believe so fervently in AI,

why they're willing to take huge risks to deliver on its promise, and whether that bet could backfire.

Thank you. and whether that bet could backfire. It's Thursday, November 20th.

Cade, it seems like the conversation on Wall Street among investors in Silicon Valley,

even in Washington these days, has gone from whether we're in an AI bubble to the general sense that, yes, we probably are in some sort of a bubble.

And yet, the companies that you cover from your perch in Silicon Valley, they're continuing to spend huge amounts of cash on this.

So, explain to us.

What is their justification for spending all this money?

Well, three years after the arrival of ChatGPT, the Open AI chat bot that really started this AI boom, this is clearly a powerful and in some ways transformative technology.

It's used not only to search the Internet in new ways, it can help people do specific tasks in a

faster and more efficient way than they did in the past. You see businesses

adopting services that can transcribe meetings. You see other applications in healthcare.

There are ways that this technology is already changing the way we live and the way we work.

And these companies, and this is classic Silicon Valley, see much bigger transformations on the

horizon. These are people, executives, these titans of industry, are looking not just at what

is possible today, but what they think this technology will do in the future.

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