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submitted 10 hours ago by MicroWave@lemmy.world to c/world@lemmy.world

Lack of profits and the threat posed by western countries are raising concern about the sustainability of Beijing’s AI boom

Trillions of dollars have been wiped from China’s stock markets in recent months amid increasing anxiety about the future of artificial intelligence, as Beijing races against the United States for dominance in the sector.

The STAR 50 Index, which tracks technology and innovation companies on the Shanghai stock exchange, has plunged 40% since June. Other indexes of major companies dropped by about 20% over the same time period.

The precipitous drop has wiped out $2.4tn from the Chinese stock market since May, according to Bloomberg.

AI stocks account for over 40% of the stock market value in China and Hong Kong, according to Goldman Sachs, meaning that any dent in value will send shockwaves across the whole domestic market.

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[-] codydodd@lemmy.ca 7 points 9 hours ago* (last edited 9 hours ago)

The idea of AI as a public utility is pretty cool. But I admit you are an early advocate for this and encourage you to keep pushing it. Edit: my take is highlighting how economically unsustainable the models are under hyper surveillance capitalism, which compliments your take i think.

[-] Cowbee@lemmy.ml 14 points 9 hours ago

Again, this fundamentally confuses how AI is treated in China and equates it to the US. Profit is secondary to utility in China, at least when it comes to infrastructure and critical industries. That's why the biggest companies in China are all state owned enterprises. AI in China is being used for pattern recognition in manufacturing and agricultural work, to help identify patterns for medical diagnosis, etc. It isn't being used to replace workers. The costs to run, say, Deepseek or Qwen are far below Claude and ChatGPT, so projecting western handling of AI onto China doesn't make much sense to me.

[-] codydodd@lemmy.ca 1 points 2 hours ago* (last edited 2 hours ago)

This is not true either though. China is rapidly divesting from certain AI portfolios and is not immune to the economics of data centers especially as they are energy vulnerable. You can't just say something is a public utility (which is good btw) and hand wave away costs or operation.

Im sure you realize Chinese state owned operations have gone bankrupt many times in the past and continue to do so.

[-] Cowbee@lemmy.ml 2 points 2 hours ago

I never dismissed costs of operation, simply that looking at stock market performance for AI in China to get a view of how it's treated and where it stands is silly.

[-] codydodd@lemmy.ca 2 points 2 hours ago

Yes true but this article is one of many and the pressures on China's approach are legitimately mounting. Fair point though. Stock markets dont mean much in china.

Ironically though I think stock market volatility of Chinese AI stocks shows their stock market is a bit healthier on that portfolio compared to the US which has runaway growth built on massive USD quantitative easing.

[-] Cowbee@lemmy.ml 2 points 2 hours ago

I think the pressures are exaggerated. There's a lot of money in discounting China's approach, considering how much money is invested in the western approach. I agree, the volatility of the stock market in China does actually seem to point to it being more grounded.

this post was submitted on 27 Oct 2026
63 points (90.9% liked)

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