I lived through the dotcom boom and bust. I recall the breathless predictions that startups with little more than a website, a silly name and a plan to sell prawn sandwiches online would be worth a fortune. (“Alex”, a British cartoon strip, satirised the frenzy with an analyst who grumbles about how hard it is to pad out “Buy them because they are going up” into a 5,000-word report for clients.) Some of my friends made paper millions and then lost them. A firm founded by one of my college classmates went spectacularly bust when the markets eventually decided that Clickmango was not, in fact, the next Amazon.

So I take it seriously when people suggest that the current AI frenzy may turn out to be a bubble. Artificial intelligence, like the internet before it, is an incredible technology that will transform the world. But that doesn’t mean that the current valuations of individual AI stocks are justified. Many people have lost their shirts betting that the future will arrive sooner than it actually does. 

Which brings me to our cover package on Nvidia, the world’s most valuable firm. Can it really be worth more than $5trn? Or should investors be worried by its financial engineering? It lends customers money to buy its chips, on such a gigantic scale that pundits call it the “bank of AI”. Critics liken this to the “vendor financing” that puffed up the revenues of network-equipment firms such as Cisco during the dotcom mania. 

Yet our cover leader is fairly sanguine. Nvidia’s balance-sheet is extraordinarily robust, with a mountain of cash and an enviable stream of profits. If its colossal bets go right, the era of AI may arrive a bit sooner. If they go wrong, the cost will fall chiefly on Nvidia’s shareholders, rather than sparking a broader financial panic. That is how capitalism is supposed to work.

Small wonder that Nvidia’s founder, Jensen Huang, is treated like a rockstar when he visits the land of his birth. Our correspondent followed him during three days of what his Taiwanese fans call “Jensanity”, and wrote an enchanting account for 1843. Elsewhere we look at the differing paces at which different professions are embracing AI, and the risky rise of the “neoclouds”, firms that buy specialist AI chips and rent them out.

This week’s episode of The Insider is all Nvidia. A panel of our top AI-watchers discussed the company’s remarkable ascent, examining the risks and possible rewards. You can watch the show now. Subscribers can also sign up to Business in Brief, our daily newsletter that analyses the most important stories on companies and currencies, with a preview of the day’s data releases, earnings reports and important financial pow-wows.