Is This What a Bubble Looks Like at the Top?

The Honest Broker provides a brutally frank guide to what's coming next

How can you tell if a tech bubble is about to burst?

Consider this recent conversation between Mark Zuckerberg and Mark Chen, chief researcher at OpenAI—as reported by the Wall Street Journal:

Zuckerberg asked Chen if he would consider joining Meta—and what it would take to bring him aboard.

A couple hundred million dollars? A billion?

A billion dollars to hire one person? Is that even conceivable? Was Zuckerberg just joking?

---

Please support my work by taking out a premium subscription (just $6 per month—or less).

---

Not at all—Mark Zuckerberg may be a bit clownish, but he’s no comedian. Consider this other news tidbit from the WSJ:

Zuckerberg settled on Alexandr Wang to lead the new lab. To get him, Meta paid $14 billion for a stake in Scale AI, the data-labeling startup founded by the 28-year-old entrepreneur.

You might respond that Zuckerberg got more than just one person for his $14 billion expenditure. He also gained an entire company. But—here’s the punchline: the company he bought for $14 billion is losing money.

According to Business Insider, Scale AI just laid of 14% of its workforce because it’s unprofitable.

But who’s counting? In this new environment, salaries and signing bonuses get tossed around like Monopoly money. The only difference is that $200 doesn’t cut it any more—you need to pay hundreds of millions to hire the top talent.

Meanwhile in the real world, McDonald’s CFO told Bloomberg that the company is struggling because many customers are now too poor to afford breakfast.

And this isn’t some isolated anecdote—it’s a data-driven report from the biggest restaurant chain in the world. Workers go to the job hungry because they don’t have money for a meal.

“Are we entering an AI-driven boom time like an out-of-control Monopoly game? Or will we be too broke to eat breakfast?”

There’s a mismatch here between two visions of the emerging economy.

So which one is real? Are we entering an AI-driven boom time like an out-of-control Monopoly game? Or will we be too broke to eat breakfast?

Let’s try to answer this question—because a lot is at stake in getting the answer right.