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AI is slowing down

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Re: AI is slowing down

#331

Post by LogicFailsMe »

Tanjreeve wrote: post #322
0000000000100 wrote: post #315

Earlier quoted context omitted.

Haha thought you were referring to the upsell at the start asking to subscribe to the newsletter for $70 / year. But yes it does call out the unprecedented amount of money getting dumped into AI. What turned me off though was this paragraph: > This is a hysterical era perpetuated by liars, cowards, imbeciles, craven boosters and the easily-fooled. Those excited about generative AI are either the victim or the perpetr…

So basically you can't find fault with the numbers but you find the tone annoying?

Well, he dismisses any value whatsoever to GenAI. That's immediate bozo bit criteria to me. And, well, if Anthropic revenue doesn't grow 5x between now and the end of the decade, I'll be pretty surprised. But, sure, if it doesn't, then someone will keep them around anyway. AMD almost died in the 2010s as one example, but they kept getting propped up and now they're back in the game swinging. There are people who can see alpha beyond the next 10Q. Ed Zitron isn't that sort.

Re: AI is slowing down

#332

Post by marcosdumay »

tom_ wrote: post #65
adamtaylor_13 wrote: post #35

Ed is an interesting character. His financial analysis of the AI industry makes logical sense to me (though I am not knowledgeable enough to actually know if it is correct .) However, he seems to be so angry at AI in general, that he misses the obvious areas where LLMs are actually changing the State of the Art. Coding seems to be one of the core use-cases for LLMs (as Simon Willison pointed out recently) and even if…

He's got subscribers. Maybe the attitude is one he's found plays well with them. I find it quite refreshing in some ways. Lots of people, when they start complaining about this or that aspect of this AI stuff, are wont to add in a little disclaimer that, despite all of the above, they actually really like AI and use it all the time. I assume this is to avoid the scenario of a bunch of pragmatic builders turning up an…

> Maybe the attitude is one he's found plays well with them.

Kind of a self-fulfilling prophecy.

What's not a problem, by the way. That's why people always recommend content creators to be themselves. If they try to be somebody else, they find their public is already busy following other people.

Re: AI is slowing down

#333

Post by aagha »

putzdown wrote: post #136

One of the "smells" that gives away a quacky ranter is they speak in impassioned, "Why doesn't everyone understand this?" tones, but in fact their argument just doesn't flow. If Zitron's argument were as solid as he keeps saying it is, you would read it and understand it and see that it is solid. He would begin somewhere–statistics on AI demand, say–and then walk the calculations carefully over to the next step–maybe…

He does this on his podcast on a regular basis.

Re: AI is slowing down

#334

Post by toasty228 »

atleastoptimal wrote: post #252
toasty228 wrote: post #215

Earlier quoted context omitted.

Revenues don't matter when you sell a dollar for 50ct and half of the deals are circular anyways

So you're claiming that the revenue growth of the S&P 500 over the last few years is largely due to "selling dollars for 50ct" and circular deals?

Yes.

https://insights.som.yale.edu/insights/this-is-how-the-ai-bu...

> AI-related stocks have accounted for 75% of S&P 500 returns, 80% of earnings growth and 90% of capital spending growth since ChatGPT launched in November 2022.

Re: AI is slowing down

#335

Post by LogicFailsMe »

cmiles74 wrote: post #309
mike_hearn wrote: post #292

Earlier quoted context omitted.

Not the OP but Zitron makes clear errors: • He seems to think that the moment Nvidia release new hardware, all existing hardware becomes worthless. It doesn't and there are plenty of tokens being served by old GPUs. This makes all his calculations about how quickly datacenters have to pay off useless. • All his numbers about costs, revenues etc are guesses or attempts to work backwards from off the cuff and frequentl…

> All his numbers about costs, revenues etc are guesses or attempts to work backwards from off the cuff and frequently inconsistent comments by tech executives. They could easily be very far off. Agreed, but I'd argue that Ed doesn't have much else to work with. I'd like to see journalists take this tack and start asking these executives to either back up their statements or back down from them. They should be held a…

It's either new GPUs make the old ones worthless or old GPUs make the new ones too expensive because they're still useful, it depends which ranter you're reading at the time.

Just like Michael Burry kept comparing NVDA to CSCO and now he doesn't do so anymore now that NVDA's P/E is ~31 and CSCO's is ~41. Funny that.

Re: AI is slowing down

#336

Post by mlyle »

LogicFailsMe wrote: post #331
Tanjreeve wrote: post #322

Earlier quoted context omitted.

So basically you can't find fault with the numbers but you find the tone annoying?

Well, he dismisses any value whatsoever to GenAI. That's immediate bozo bit criteria to me. And, well, if Anthropic revenue doesn't grow 5x between now and the end of the decade, I'll be pretty surprised. But, sure, if it doesn't, then someone will keep them around anyway. AMD almost died in the 2010s as one example, but they kept getting propped up and now they're back in the game swinging. There are people who can…

> Well, he dismisses any value whatsoever to GenAI.

I didn’t read it that way. I see a lot of value in it.

I just don’t see us justifying the amount of infrastructure being built or current valuations. Or in the unlikely event that we do, the societal upheaval is going to take away the ability to monetize it meaningfully.

OpenAI and Anthropic may make it through. But that is different from saying valuations are justified or that all this infrastructure will pay off.

Re: AI is slowing down

#337

Post by dofm »

mike_hearn wrote: post #292
cmiles74 wrote: post #284

Earlier quoted context omitted.

I don't read Ed Zitron, aside from when he appears here on Hacker News, and I also find his tone to be over-the-top. I think we might agree on that much. These articles are lengthy but, to my understanding, Ed's idea is... * AI companies have committed to purchasing X amount of compute * Data centers are being constructed to meet this demand, they'll need to charge amount Y * AI companies do not have sufficient reven…

Not the OP but Zitron makes clear errors: • He seems to think that the moment Nvidia release new hardware, all existing hardware becomes worthless. It doesn't and there are plenty of tokens being served by old GPUs. This makes all his calculations about how quickly datacenters have to pay off useless. • All his numbers about costs, revenues etc are guesses or attempts to work backwards from off the cuff and frequentl…

> He seems to think that the moment Nvidia release new hardware, all existing hardware becomes worthless.

I am the OP and I totally agree with you on this one point. In fact the progress being made by open weights models strongly suggests that some of this hardware has much more of a life.

The overarching point he makes about incomplete data centres is that the current offering is running successfully on that very incomplete capacity, right?

What he is saying is that he cannot believe the demand exists to fill any of the unbuilt stuff, but much of it is still commitments that are going to have to be paid for, unless they can be backed out. He points to Nadella essentially confirming there will be overcapacity.

He also makes an interesting point that people tend to think "I can't get a GPU right now" means "there is intense, live demand for GPUs in data centres" when in fact the reason you can't get one is buy-and-hold. Including much of that new replacement hardware: it is being bought even the old stuff would (let us stipulate will) do the job.

I think he (or someone who interviewed him) recently said it reminded them less of the dot com boom and more of the Chinese real estate bubble.

Re: AI is slowing down

#338

Post by kgeist »

Animats wrote: post #122

* * *

>LLM-type AI exacts huge costs because it is terrible at reporting "I don't know". When it doesn't know, it generates noise and polishes it.

>If a "confidence too low for output" signal could be extracted, this whole technology would be a lot more useful

Anthropic's interpretability research explored this topic a bit in 2025. Apparently, the signal is extractable:

  It turns out that, in Claude, refusal to answer is the default behavior: we find a circuit that is "on" by default and that causes the model to state that it has insufficient information to answer any given question. However, when the model is asked about something it knows well—say, the basketball player Michael Jordan—a competing feature representing "known entities" activates and inhibits this default circuit (see also this recent paper for related findings). This allows Claude to answer the question when it knows the answer. In contrast, when asked about an unknown entity ("Michael Batkin"), it declines to answer.

  By intervening in the model and activating the "known answer" features (or inhibiting the "unknown name" or "can’t answer" features), we’re able to cause the model to hallucinate (quite consistently!) that Michael Batkin plays chess.

  Sometimes, this sort of “misfire” of the “known answer” circuit happens naturally, without us intervening, resulting in a hallucination. In our paper, we show that such misfires can occur when Claude recognizes a name but doesn't know anything else about that person. In cases like this, the “known entity” feature might still activate, and then suppress the default "don't know" feature—in this case incorrectly. Once the model has decided that it needs to answer the question, it proceeds to confabulate: to generate a plausible—but unfortunately untrue—response.
https://www.anthropic.com/research/tracing-thoughts-language...

Re: AI is slowing down

#339

Post by marcosdumay »

metadat wrote: post #4
ElFitz wrote: post #2

I find it difficult to separate this piece’s tone from its content. The tone puts me off and makes it hard for me to judge it on its merits, despite some of the arguments seeming sound and well supported.

Agreed. I am open to the possibility of the bubble bursting or whatever, but this piece is like 3,000 words and cites everything as evidence the sky is falling. It's just as bad as the pro-AI grifters, just in the other direction. Does the truth normally lie somewhere in the middle of it all?

At the /. times, there was somebody there with the best signature line. It was something like:

"Some people say the Sun sets at East, other people say it sets at West. The truth, of course, is certainly on the middle."

Re: AI is slowing down

#340

Post by ai_critic »

mike_hearn wrote: post #292
cmiles74 wrote: post #284

Earlier quoted context omitted.

I don't read Ed Zitron, aside from when he appears here on Hacker News, and I also find his tone to be over-the-top. I think we might agree on that much. These articles are lengthy but, to my understanding, Ed's idea is... * AI companies have committed to purchasing X amount of compute * Data centers are being constructed to meet this demand, they'll need to charge amount Y * AI companies do not have sufficient reven…

Not the OP but Zitron makes clear errors: • He seems to think that the moment Nvidia release new hardware, all existing hardware becomes worthless. It doesn't and there are plenty of tokens being served by old GPUs. This makes all his calculations about how quickly datacenters have to pay off useless. • All his numbers about costs, revenues etc are guesses or attempts to work backwards from off the cuff and frequentl…

It helps if you look at Zitron's work history and experience. He's a hype man and a games journalist. His opinions on this are whatever sells, not exactly whatever is correct.

This is alarmingly obvious whenever he talks out of his depth about things like how companies actually use AI and reason about business decisions.

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