A few days ago, the market woke up to news that shook investor confidence: the Deepseek artificial intelligence model, developed by a Chinese startup, is generating uncertainty and volatility. With explosive popularity in app stores in the United States and China, Deepseek presents itself as a more efficient and accessible alternative to ChatGPT. However, the market reaction has been one of panic. Why?
Investor Perception and Fear of Chinese Supremacy
The short answer is that many investors do not understand the relationship between technology and financial markets. For them, the fact that a Chinese startup has developed a superior model with a budget of just $6 million raises two key questions:
- Why have U.S. companies spent billions on seemingly inferior models?
- Is China surpassing the U.S. in the artificial intelligence race?
Nevertheless, it is crucial to question any claim coming from China in this field. The Chinese government has a history of manipulating financial and technological information, and Chinese companies have been caught multiple times making fraudulent statements. While we cannot rule out that Deepseek has achieved this feat, it seems highly unlikely that they have surpassed OpenAI, Anthropic, or xAI with just a fraction of the budget.
A Positive or Negative Development for AI?
Assuming that Deepseek has indeed made a major breakthrough with minimal investment, the key question is: Is this good or bad for the industry?
From a macroeconomic standpoint, the availability of a cheaper and more accessible model is positive. Jevons’ paradox suggests that an increase in technological efficiency leads to an increase in its usage. Companies across all sectors will be able to adopt AI to optimize processes, improve productivity, and generate economic growth.
However, investors have reacted with panic. NVIDIA, one of the biggest beneficiaries of the AI boom, saw its value drop by 11% that day. This suggests that the markets are acting out of fear rather than logic. If Deepseek managed to develop its model with inferior chips, shouldn’t this actually strengthen NVIDIA? With better chips, they could achieve even more.
Smart AI Investment
Many investors have bet on major AI companies using a momentum investing strategy. When a stock rises, they buy it expecting it to keep rising. But when uncertainties arise, the market can become brutal.
This is where a smarter strategy comes in: investing in companies that use AI rather than those that develop it. The real potential lies in companies that leverage artificial intelligence to reduce costs, increase productivity, and improve efficiency.
A key metric to evaluate is revenue per employee. If a company increases this figure over time thanks to AI, it is a strong candidate for investment.
Conclusion: Long-Term Thinking in a Volatile Market
The market may be in crisis today, but that does not mean AI has lost its potential. As Warren Buffett said, in the short term, the market is a “voting machine”, but in the long term, it is a “weighing machine”. The key is to stay calm and think long term.
We are at the dawn of a technological revolution that will transform the global economy. It’s not just about investing in artificial intelligence or Bitcoin, but in companies that will know how to leverage them to create real value. Talking about a “market apocalypse” is an overreaction; the opportunity lies in identifying the right trends and maintaining investment discipline.
The best time to live will be tomorrow. The second best is today.
