The funniest part is that the thing that could actually make AI useful at scale might be what wrecks the investment thesis: cheap, local, open weight models. Wall Street funded a trillion dollar server farm to discover that sometimes the answer is a smaller model running on your laptop. The technology might win while the investors lose. Nevertheless, companies such as Google, Amazon, and Microsoft – as well as Nvidia and AMD – are a very long way from simply going under.
Google, Amazon and Microsoft will be fine.
Oracle, though. It’s possible they’ll actually die. And wouldn’t that be tragic.
Oracle, though. It’s possible they’ll actually die. And wouldn’t that be tragic.
Oh the humanity
I doubt it. Government would step in and bail them out.
yep, with our money.
This isn’t going to happen. They’re not the banks, and they’re pretty universally hated in the country.
When the AI bubble pops it’s going to take down the banks.
There is a lot of private credit dollars loaned to data centers and the banks are heavily invested in private credit.
It’s a house of cards priced for perfection just waiting for one of the big 5 to have a slightly off quarter.
I’m so burnt out and jaded on AI that I don’t think I’ll ever use it for any reason ever. I just wish we could put the cat back in the bag. I know that will never happen.
There is this insane amount of investment in AI built around LLMs that threatens the entire world. People worry about the bubble bursting but think AI is the ant’s pants without considering that the LLM is a dead end. None of the AI companies are going to achieve Artificial Intelligence. That’s why they will actually implode, their systems aren’t intelligent.
I mean, they are artificial intelligence by pretty much any normal definition of that term. So is Battle Chess from the 1980s. So is bank fraud detection. So is Conway’s Game of Life in its most basic definition.
Will they develop “super intelligence”, etc? No
It wont be a real AI, but itll be just enough to kill off a lot of the software industry.
what software industry? React developer industry?
I’m genuinely curious what “real AI” is to you?
Real ai to me would mean true agency. And an entity which has its own goals and relationship to its world.
Yeah. I wonder if it might be difficult to identify something that reaches that point? I suppose genuine creativity might be an indication of intelligence? Or a desire to reprogram itself? I dunno, I’ve recently read Peter Watts blindsight and it kind of made me reconsider the relationship between consciousness and intelligence.
A true Turing Machine, obviously
One that when given input will give the correct output, every time, without fault or stalling, in a timeframe that is quick
A Turing machine has nothing to do with AI. Pretty much any computer today can emulate one, the only thing lacking is infinite memory.
Isn’t there a difference between Turing Complete and Turing Machine?
I thought many machine can be Turing Complete (when given infinite resources, can give any required output), but a Turing Machine is one that is complete?
well, they are being trained my the management, and as we all know these types wan’t 150% of the benefit with 25% of the work.
I fear that yes they are not good enough to actually replace labor, but good enough to cause unprecedented chaos. Under capitalism, at least.
“more clear that the real future of AI is small language and open-weight models running on local desktop computers” So where are we with those smaller models? I haven’t been following them. Are they any good?
Please let it happen. Please! Hopefully datacentres gets demolished also or turned into puppy orphanages.
Some datacenters could be repurposed as traditional datacenters focused on networking and cloud storage, infrastructure.
Look, none of use should be cheering for a full on pop of the buble. It will hurt all industries. And we know the oligarchy has insulated themselves in ways that will ensure they feel very little pain. It will be all the workers who will feel it. As for data centers, I don’t think we need the bubble to burst to fight that. Lots of jurisdictions are already banning them. That is what we should be cheering for.
While I am not cheering for the bubble to pop, the longer it goes on the worse it will be so the sooner it happens the better.
I dunno. The market affect is mostly perception. I mean why should unrelated stocks suffer when AI companies fall, yet they do. So I don’t think the length of time actually impacts the severity of the crash. But I’m no economist. That’s more of a “I don’t see why”, rather than a “no it won’t”
The main issue is that increasingly AI companies are making up a big portion of index funds which are required by law to be purchased by mutual fund managers and thus part of retirement accounts, so value will be evaporated out of retirees accounts. The larger the bubble the more the impact.
Also note that the only reason the US is not in recession right now is due to AI market “growth” so the GDP correction that follows will cause companies who have invested in the technology (not just AI companies, but most of the Fortune 500) to contract. The fallout will be unpredictable, but the most likely scenario is layoffs. Further, the Fed will be reluctant to cut interest rates, because inflation is extremely high due to tariffs, so the one lever the government has to stave off the recession has been compromised by the current administration. So the recession will be deeper and worse with a longer recovery than it would otherwise have.So why care? Because grandma’s retirement will disappear, a bunch of people will be laid off and the levers available to mitigate the impact have already been pulled. Oh and inflation will get worse when our government bails out AI tech bros to the tune of $1T.
So I agree on the impact, and on the why care. But I’m not seeing why waiting long makes it worse. Based on what you said, waiting longer could help if it can hold out until this tariff war is over (one way or the other). Then it might be possible to lower interest rates to soften the impact. If it can hold out for a whole new administration even, that could help a lot. Though that is also what would likely trigger it, as a new administration will likely restore regulations that have been relaxed, increasing costs to business. But I would rather pay that price at that time with that administration than this one.
The bubble is growing over time. It will have a more severe impact in two years than it would if it happened tomorrow.
That makes logical sense, but I am looking for a more solid explanation. Again, I am not saying it isn’t, I am asking how could I say that to someone and then back it up with a solid why.
AI could be used to save our planet from catastrophic climate change, to problem solve ways to improve things, to do hard labor so that people don’t have to… but nah let’s use it to make assholes with too much money get more money! That’s fantastic
We already got solutions. What’s missing is the courage and incentives to actually adopt them by political leaders and the larger public. If AI would replace our politicians maybe it could help, otherwise it’s just the latest proof that there’s plenty of money around to transform the economy into whatever we want it to be. I guess we prefer chat bots over carbon neutral.
Replace the useless greedy politicians with AI. Prompt: See what those assholes are doing? Do the opposite.
What a lovely world it would be without the insufferable type of wankstains that feel they need to run for public office. I’m sure there are all of six good people that are really trying to make a difference, but they usually get buried by their opposition who gets into bed with rich douchebags.
Burn it to the ground.
They didn’t listen to the scientists.
Somehow I think AI would go from “Super Intelligence” to “that libtard tree hugging computer made of parts from commie Chy-na” as soon as it told them to do something legit that would inconvenience them or disagree with their narrative.
There are lot of problems in this world that make artificial intelligence dooming humanity seems like tuesday in comparison , and those problems got similar treatment from all of humanity: protest, hearing, discussions and a bit of outlier that spark things a bit and after that moved on to another problem without solution a.k.a status quo till everything collapse.
I mean why a.i dooming entire humanity begets different treatment?
My money’s on plague.
I put my stake to ongoing environment collapse like sane person here.
The fact that more people don’t know just how far past the point of no return we are is still shocking sometimes.
we just had that.
Nephew calling a 1.25% drop a “tailspin”.
Look up the Flash Crash sometime, that is NOTHING.
I’d suggest that the 1929 stock market crash get an entire unit in elementary school, High school, and every economics course in college. Do the same for the 89’ crash and the Dot com Bubble. Really drill it into these young entrepreneurs how Speculating in the stock market NEVER EVER leads to anything good. It’s a Faustian bargain. The consequences WILL arrive; not a matter of “if” but “when.”
Not sure about never. I did very well from my Amazon stock at $25
Yeah I have done pretty well too, but the music box is winding down at this very moment.
this is what I’m saying. You may make a fortune but it will always be dependant on a house of cards built on shifting sands.
As a financial analyst, Klement’s take on the AI economy has been notably grim — back in May, he penned an article in Reuters arguing that institutional investors shouldn’t be asking “whether the AI boom will end, but what will happen to markets when it does.” Now, his live interview on Bloomberg‘s flagship news channel underscores the degree to which the AI bubble is becoming impossible for mainstream commentators to ignore […]
What’s interesting to me is that people who run Bloomberg have a huge advantage in manipulating the market.
In fact, the story behind the AI boom really has to be how the business press operates, always enabling the upper class to be richer.
Of course, if the Iraq war is any example, there will be a few confessions and nothing will change.
Hope the fuckers all burn.
1 newspaper
Yeah, Bloomberg though. Not saying that they are great, but it’s among those that Wall Street bros read to decide what to buy and sell
investing in the wrong future
I’m assuming they mean “future” in the same way the stock market (ab)uses the word, because AI had its lower ribs removed on day one. There’s no future there.
The lobster is out, read the room. You’re seeing articles of people stating local models are the future in tandem with hardware companies stating prices will go up for hardware and shortages will remain. This is a classic double tap from behind. It’s done. There were some good applications to it, which will continue. But overall it’s a toddler dropping their ice cream cone on the ground.
We’ve basically got to wait for Anthropic and OpenAI to actually IPO before any of this can get started properly. Once there’s a public expectation for profit from the two biggest AI labs, then the market will start acting against them. We can hope, at least.
Once there’s a public expectation for profit from the two biggest AI labs
I don’t think that it’s necessarily the order things will go.
Anthropic and OpenAI have bills to pay, including obligations to pay a ton of money to partners/vendors in the coming years. They need cash to do that. And the cash can come from 3 main places: revenue from customers, loans from lenders (usually in the form of issuing bonds), and issuing new stock/equity to raise funds.
The IPOs are basically their last chance to raise funds by issuing new equity. Even if each of them raise $100 billion, that’s probably not enough to hit self sustaining profitability. As lenders start to get more skeptical, in a macroeconomic environment with high interest rates and high energy prices, they start to run into a very real possibility that they hit illiquidity issues, even if their core business model actually works by then (and I don’t think it will). There’s just not enough runway for them, even in the most optimistic long term projections.
