Nvidia’s AI story is the Jevons paradox in silicon—each efficiency gain triggers more demand, not less, creating a self-reinforcing cycle that keeps defying the doomsayers. Jensen Huang’s GTC keynote dazzled 30,000-plus attendees with encyclopedic range and depth, while short sellers keep waiting for a bubble that refuses to pop. With Nvidia projecting $1 trillion in sales by 2028, the real question isn’t the company’s ceiling—it’s the total market it is lifting with it.
The Jevons paradox, observed by British economist William Stanley Jevons in 1865, noted that although steam engines became more efficient at using coal, total coal consumption in England rose because more engines were built and used, making the overall industry more reliant on it. Today, we call that a virtuous cycle, a chain of events where one positive occurrence triggers another, leading to a continuous, self-reinforcing upward trend. Nvidia’s AI steam engine certainly fits that description.
While everyone is ready for calamity and failure, short sellers still keep beating their drums about the AI bubble. Nvidia keeps announcing one new processor, one new acquisition, one new investment, and one new record quarterly financial result after another. I hope short sellers didn’t use their homes as collateral.
Figure 1. Nvidia’s growth in AI has been amazing.
Nvidia CEO Jensen’s Huang’s two-hour presentation at GTC in San Jose, California, this week was nothing but mind-boggling with the range and depth of products he showed and the demonstration of his encyclopedic memory. GTC hasn’t been a chip show in over 10 years, yet Huang still feels he has to explain that to the audience, which this year exceeded 55,500 people online and 30,000-plus in the stands. The only things missing were balloons, bubbles, and fireworks as he left the stage. And I’ll bet if the cops didn’t arrest you, you could make some money selling short, black leather jackets outside the SAP Center—or how about little black leather jackets for your pet.
At his GTC keynote, Huang said he could easily forecast that Nvidia would exceed $1 trillion in sales by 2028. Nvidia is a big player in the AI market, but not 50% of it. So, if Nvidia hits $2 trillion, think of what the TAM for this explosive industry is going to be. And not only that, think of all the great houses that are going to be for sale at a discount in the New York area.
Where’s a damn black swan when you need one?
You shoulda invested in coal. —William Stanley Jevons
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