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How the AI Bubble Will Pop

derekthompson.org

61–70 of 531 posts

Re: How the AI Bubble Will Pop

#61
post #15

Earlier quoted context omitted.

> Try building something new in claude code (or codex etc) using a programming language you have not used before. Your opinion might change drastically. Try changing something old in claude code (or codex etc) using a programming language you have used before. Your opinion might change drastically.

this is literally how i maintain the code at my current position, if i didn't have copilot+ i would be cooked

[flagged]

Re: How the AI Bubble Will Pop

#62
post #12

The most frustrating thing to me about this most recent rash of biz guy doubting the future of AI articles is the required mention that AI, specifically an LLM based approach to AGI, is important even if the numbers don't make sense today. Why is that the case? There's plenty of people in the field who have made convincing arguments that it's a dead end and fundamentally we'll need to do something else to achieve AGI…

[even in programming it's inconclusive as to how much better/worse it makes programmers.] Try building something new in claude code (or codex etc) using a programming language you have not used before. Your opinion might change drastically. Current AI tools may not beat the best programmer, they definitely improves average programmer efficiency.

I did just that and I ended up horribly regretting it. The project had to be coded in Rust, which I kind of understand but never worked with. Drunk on AI hype, I gave it step by step tasks and watched it produce the code. The first warning sign was that the code never compiled at the first attempt, but I ignored this, being mesmerized by the magic of the experience. Long story short, it gave me quick initial results despite my language handicap. But the project quickly turned into an overly complex, hard to navigate, brittle mess. I ended up reading the Rust in Action book and spending two weeks cleaning and simplifying the code. I had to learn how to configure the entire tool chain, understand various cargo deps and the ecosystem, setup ci/cd from scratch, .... There is no way around that.

It was Claude Code Opus 4.1 instead of Codex but IMO the differences are negligible.

Re: How the AI Bubble Will Pop

#63
> It’s not clear that firms are prepared to earn back the investment

I am confused by a statement like this. Does Derek know why they are not? If hes does, I would love to hear the case (and no, comparisons to a random countries GDP are not an explanation).

If he does not, I am not sure why we would not assume that we are simply missing something, when there are so many knowledgable players charting a similar course, that have access to all the numbers and probably thought really long and hard about spending this much money.

By no means do I mean that they are right for that. It's very easy to see the potential bubble. But I would love to see some stronger reasoning for that.

What I know (as someone running a smallish non-tech business) is that there is plenty of very clearly unrealized potential, that will probably take ~years to fully build into the business, but that the AI technology of today already supports capability wise and that will definitely happen in the future.

I have no reason to believe that we would be special in that.

Re: How the AI Bubble Will Pop

#64

The most frustrating thing to me about this most recent rash of biz guy doubting the future of AI articles is the required mention that AI, specifically an LLM based approach to AGI, is important even if the numbers don't make sense today. Why is that the case? There's plenty of people in the field who have made convincing arguments that it's a dead end and fundamentally we'll need to do something else to achieve AGI…

It's silly to say that the only objective that will vindicate AI investments is AGI.

Current batch of deep learning models are fundamentally a technology for labor automation. This is immensely useful in itself, without the need to do AGI. The Sora2 capabilities are absolutely wild (see a great example here of what non-professional users are already able to create with it: https://www.youtube.com/watch?v=HXp8_w3XzgU )

So only looking at video capabilities, or at coding capabilities, it's already ready to automate and upend industries worth trillions in the long run.

The emerging reasoning capabilities are very promising, able to generate new theories and make scientific experiments in easy to test fields, such as in vitro drug creation. It doesn't matter if the LLM hallucinates 90% of the time, if it correctly reasons a single time and it can create even a single new cancer drug that passes the test.

These are all examples of massive, massive economic disruption by automating intellectual labor, that don't require strict AGI capabilities.

Re: How the AI Bubble Will Pop

#65

The most frustrating thing to me about this most recent rash of biz guy doubting the future of AI articles is the required mention that AI, specifically an LLM based approach to AGI, is important even if the numbers don't make sense today. Why is that the case? There's plenty of people in the field who have made convincing arguments that it's a dead end and fundamentally we'll need to do something else to achieve AGI…

There is a middle ground where LLMs are used as a tool for specific use cases, but not applied universally to all problems. The high adoption of ChatGPT is the proof of this. General info, low accuracy requirements - perfect use case, and it shows.

The problem comes in when people then set expectations that a chat solution can solve non-chat problems. When people assume that generated content is the answer but haven't defined the problem.

We're not headed for AGI. We're also not going to just say, "oh, well, that was hype" and stop using LLMs. We are going to mature into an industry that understands when and where to apply the correct tools.

Re: How the AI Bubble Will Pop

#66
post #9

Article is behind paywall and is simply saying the same things that people have been saying about the post tech crash. Now, what this sort of article tends to miss (and I will never know because it’s paywalled like a jackass) is that these models services are used by everyday people for every day tasks. Doesn’t matter if they’re good or not. It enables them to do less work for the same pay. Don’t focus on the money t…

The issue though being that most people aren't paying and even those paying if they use it moderately aren't profitable. Nvidia "investing" 100B in one of its largest customers is a cataclysmically bright red flag.

Re: How the AI Bubble Will Pop

#67
post #12

Earlier quoted context omitted.

[even in programming it's inconclusive as to how much better/worse it makes programmers.] Try building something new in claude code (or codex etc) using a programming language you have not used before. Your opinion might change drastically. Current AI tools may not beat the best programmer, they definitely improves average programmer efficiency.

> they definitely improves average programmer efficiency Do we really need more efficient average programmers? Are we in a shortage of average software?

> Are we in a shortage of average software?

Yes. The "true" average software quality is far, far lower than the average person perceives it to be. ChatGPT and other LLM tools have contributed massively to lowering average software quality.

Re: How the AI Bubble Will Pop

#68
post #40

Also no one is talking about how exposed we are to Taiwan. Nvidia, AMD, Apple, any company building out GPUs (so Google, Microsoft, Meta etc), even Intel a bit, are all manufacturing everything with one company, and it's largely happening in Taiwan. If China invades Taiwan, why wouldn't TSMC, Nvidia and AMD stock prices go to zero?

> Also no one is talking about how exposed we are to Taiwan.

We aren't? It's one of the reasons the CHIPS Act et al get pushed through, to try to mitigate those risks. COVID showed how fragile supply chains are to shocks to the status quo and has forced a rethink. Check out the book 'World On The Brink' for more on that geopolitical situation.

Re: How the AI Bubble Will Pop

#69

The most frustrating thing to me about this most recent rash of biz guy doubting the future of AI articles is the required mention that AI, specifically an LLM based approach to AGI, is important even if the numbers don't make sense today. Why is that the case? There's plenty of people in the field who have made convincing arguments that it's a dead end and fundamentally we'll need to do something else to achieve AGI…

FWIW Derek Thompson (the author of this blogpost) isn't exactly a 'business guy'

Re: How the AI Bubble Will Pop

#70

It reminds me what I said to somebody recently: All my friends and family are using the free version of ChatGPT or something similar. They will never pay (although they have enough money to do so). Even in my very narrow subjective circles it does not add up. Who pays for AI and how? And when in the future?

Someone is paying. OpenAI revenue was $4.3 billion in the first half of this year.
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