The Death of the Efficient-Market Hypothesis

The efficient-market hypothesis is dead, dead, deadski.

Jensen Huang did it again! Recently, he single-handedly tanked quantum computing share prices by claiming useful quantum computers might still be decades away. Experts in quantum computing disagreed, though the damage had already been done.

A few days ago, he admitted to being wrong about that. Kudos to an executive for admitting being wrong. That said, he only offered a half-baked apology, claiming his words had come out wrong. No, Mr Huang, they had not. You were very clear. Just wrong.

So, did the stock prices rebound? If markets were truly efficient, you’d expect a rapid correction. No, they did not. Instead, they fell even further, dropping another 10% or more.

To isolate the effect, I excluded IBM, Google, Amazon, and Microsoft, as their stock prices reflect more than just their quantum computing investments. The pattern is clear: public statements by NVIDIA’s CEO caused a significant drop. Even after his correction, quantum stocks have only recovered to about half their pre-Huang levels.

Jensen Huang’s claim that he was unaware of any publicly traded quantum computing companies suggests a deeper issue: investors often respond more to perceived authority than to domain expertise. The market did not react to new information; it reacted to the source. An irrelevant one at that. If that isn’t the final nail in the coffin of the efficient-market hypothesis, I don’t know what is.