Is the A.I. Boom Turning Into an A.I. Bubble?
91–100 of 117 posts
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#92Over-investment in a new technology seems to be a common thing. It happened with the Internet and railroad. A bubble forms which pops. But the process leaves behind valuable infrastructure.
It's too bad the infrastructure in this context largely becomes obsolete in under a decade. Optimistically, we'll have a lot of data centers with a lot of generalized resources, but I have a feeling the margins get pretty thin on operating/maintaining those facilities absent high demand.
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#93Earlier quoted context omitted.
> Diversify, be reasonable and be prepared for it to happen someday. Indeed, but even with something like SPY, there’s quite the concentration in tech: Top 10 Holdings (37.99% of Total Assets) NVDA 8.07% MSFT 7.37% AAPL 5.77% AMZN 4.11% META 3.12% AVGO 2.57% GOOGL 2.08% GOOG 1.68% BRK-B 1.61% TSLA 1.61% Now that’s intentional as it’s market cap weighted. But the investing world is in for a rude awakening if things st…
Just buy $RSP or a similar equal-weightage ETF.
We need a etf that weights with the log of the market cap
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#94Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#95Earlier quoted context omitted.
If you've been with HN for awhile, or you search the archives, similar topics to "Is the AI booming turning into an AI bubble" kept popping up long before CHatGPT came out. And this was DNNs, and it was same people (e.g. Hinton and his students) who were at the forefront of that also. And no, their previous projects didn't go bust.
Well, ok, good point. There has been people claiming that "their work will stop scaling any time now" for some 12 years. (To be fair, it can't scale forever and seems to have stopped scaling by now.) That is a hype bubble. I maintain that it's not the bubble the article and everybody is talking about. People are talking about the billions (but the plural doesn't do it justice) running around looking for a return. A l…
> There has been people claiming that "their work will stop scaling any time now" for some 12 years. (To be fair, it can't scale forever and seems to have stopped scaling by now.)
Their work kept scaling, they just branched out into generative AI to keep going. Now, eventually they won't be able to scale up or branch out anymore, and I guess your bet is that this will happen before AGI is reached?
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#96Earlier quoted context omitted.
And rich people aren't getting richer through smarter investments, but by wealth accumulation on existing assets that people need.
Being able to hold on to wealth is an underestimated and undervalued ability. It's actually pretty easy to lose money. Everybody is happy to help you part with yours.
> It's actually pretty easy to lose money.
By what mechanism / who exactly? Or referring explicitly to the ultra wealthy? When I think of the normal wealthy, the 1-20 million camp, can't they just stuff all of their money into index funds for the last 20 years and everyone grows 10%+ a year (most years)? That's what the few multi millionaires I personally know have done -> step 1 put money in e.g. Vanguard, step 2 maintain job and spend based on income, not accumulated wealth, step 3 do nothing as wealth builds itself. Once they get past 2 million, I think they are making 80-200k per year at capital gains rates and maybe don't even need to put more in, just ignore it. I don't personally have that situation though so maybe I'm glossing over details or have it wrong.
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#97Earlier quoted context omitted.
Being able to hold on to wealth is an underestimated and undervalued ability. It's actually pretty easy to lose money. Everybody is happy to help you part with yours.
> It's actually pretty easy to lose money. By what mechanism / who exactly? Or referring explicitly to the ultra wealthy? When I think of the normal wealthy, the 1-20 million camp, can't they just stuff all of their money into index funds for the last 20 years and everyone grows 10%+ a year (most years)? That's what the few multi millionaires I personally know have done -> step 1 put money in e.g. Vanguard, step 2 ma…
Earning $1mil and stuffing 100% of it into the stock market is a risky move.
You lay out basically the situation I found myself in. But I set aside some for a future house down payment (less risk for that chunk), future wedding (less risk for that chunk), and even ignoring that, most advice wouldn't say to stuff the remaining 100% into markets.
So maybe 60% went into markets. With hindsight it oftentimes sounds like a good idea to just drop it all in the market. But life is uncertain and crystal balls are in short supply... you would feel stupid if you made $1mil, put it all in stocks, and life came out of nowhere and took a dump all over you when the markets tanked.
Not saying I'm in a bad position, but its nowhere near "1mil at 10% per year (which is in itself kinda a wild base assumption)".
TLDR: people have a rosy unrealistic view of how this works out.
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#98Earlier quoted context omitted.
Being able to hold on to wealth is an underestimated and undervalued ability. It's actually pretty easy to lose money. Everybody is happy to help you part with yours.
> It's actually pretty easy to lose money. By what mechanism / who exactly? Or referring explicitly to the ultra wealthy? When I think of the normal wealthy, the 1-20 million camp, can't they just stuff all of their money into index funds for the last 20 years and everyone grows 10%+ a year (most years)? That's what the few multi millionaires I personally know have done -> step 1 put money in e.g. Vanguard, step 2 ma…
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Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#99Earlier quoted context omitted.
Trump election will tank the stock market - Many nobel prize economists and experts .
He did though. The S&P 500 fell 18% around Mar/Apr. That's unprecedented for a US market experiencing no external shocks.
> The S&P 500 fell 18% around Mar/Apr.
where ? i don't see it.
Re: Is the A.I. Boom Turning Into an A.I. Bubble?
#100I get this sinking feeling that this "bubble" may never burst on its own, since the political environment now is different from the 2000s. Inequality is much higher post-COVID, with the ultra-wealthy sucking up the assets of the middle class. Those assets are going into the stock market for AI companies with the objective of eventually replacing people so they never need to pay the working or middle class ever again.…
TINFOIL HAT SAYS: Since you used the P-word, consider the 2008 election and the possibility that a similar bubble-bursting occurring at the appropriate time to maximize chances to flip Congress in 2026.