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AI boom risks global financial crash, warn central bankers

telegraph.co.uk

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Re: AI boom risks global financial crash, warn central bankers

#21

Post by Grombobulous »

mountainriver wrote: post #4

Meanwhile AI has gotten so good it can just about one shot a SaaS app. I’m not worried about it…

So good at it that I’m right now in the process of building instead of buying.

Here’s how that plays out in the economy:

- My company spent $50 on my tokens to build this internal tool

- Anthropic spent $XXX to deliver those tokens to me.

- The company I was going to buy the tool from lost $XX,XXX per year that I would have paid them.

I dunno, kind of sounds like the economy just got smaller.

I could usually accept the idea that software getting cheaper generally increases demand for software and expands the economy surrounding it, but I’m not sure if we have precedent for what happens when software becomes positively worthless.

Re: AI boom risks global financial crash, warn central bankers

#22

Post by loeg »

Grombobulous wrote: post #21
mountainriver wrote: post #4

Meanwhile AI has gotten so good it can just about one shot a SaaS app. I’m not worried about it…

So good at it that I’m right now in the process of building instead of buying. Here’s how that plays out in the economy: - My company spent $50 on my tokens to build this internal tool - Anthropic spent $XXX to deliver those tokens to me. - The company I was going to buy the tool from lost $XX,XXX per year that I would have paid them. I dunno, kind of sounds like the economy just got smaller. I could usually accept t…

Are you putting the $XX,XXX-50 under your mattress or investing it in something else productive?

Re: AI boom risks global financial crash, warn central bankers

#26

Post by Grombobulous »

loeg wrote: post #22
Grombobulous wrote: post #21

Earlier quoted context omitted.

So good at it that I’m right now in the process of building instead of buying. Here’s how that plays out in the economy: - My company spent $50 on my tokens to build this internal tool - Anthropic spent $XXX to deliver those tokens to me. - The company I was going to buy the tool from lost $XX,XXX per year that I would have paid them. I dunno, kind of sounds like the economy just got smaller. I could usually accept t…

Are you putting the $XX,XXX-50 under your mattress or investing it in something else productive?

I certainly can’t give you a better answer for my company than “it depends” or “I don’t really know.”

The company could just be happy to have better margins and be happy the stock finally went up. It might literally do nothing with them or do something economically unproductive like buy back stock.

What I can tell you with certainty is that we aren’t going to hire anyone else or launch any other product as a result. Our business just isn’t at that level of growth potential.

Perhaps we can surmise that money going to shareholders can grow the economy. They’ve got more money to reinvest in other stuff.

But then again, if everyone can shart out a SaaS app with $50 in tokens, what software companies will they want to invest in?

AI gives me that feeling of “what happens to bakers and butchers when the supermarket gets invented and they decide to sell bread and meat at or below cost?”

Re: AI boom risks global financial crash, warn central bankers

#27

Post by brendoelfrendo »

loeg wrote: post #22
Grombobulous wrote: post #21

Earlier quoted context omitted.

So good at it that I’m right now in the process of building instead of buying. Here’s how that plays out in the economy: - My company spent $50 on my tokens to build this internal tool - Anthropic spent $XXX to deliver those tokens to me. - The company I was going to buy the tool from lost $XX,XXX per year that I would have paid them. I dunno, kind of sounds like the economy just got smaller. I could usually accept t…

Are you putting the $XX,XXX-50 under your mattress or investing it in something else productive?

Unless that money is being spent on more tokens, it'll probably be used for stock buybacks.

Re: AI boom risks global financial crash, warn central bankers

#29

Post by lstodd »

kingleopold wrote: post #20
georgemcbay wrote: post #11

Earlier quoted context omitted.

> Meanwhile AI has gotten so good it can just about one shot a SaaS app. There isn't a direct correlation between AI improvement or stagnation and whether or not the amount being spent by AI labs and the associated ecosystem will result in a financial crash. Look into the history of railroads and the internet itself to see how massive levels of investment can result in economic crashes even when the thing being inves…

difference this time is they have "fiat money" and money printer. Market and all inv. bankers knows that in major crash they will print unlimited amounts so back to same prices or near them. printer is still printing and it's only goes to selected investments

As if they did not back then. Fiat is just simpler to work with, but one can pull a bubble without it just fine. Anyone forgot the railroad crash of 1873? The tulip mania of 17th century?

Re: AI boom risks global financial crash, warn central bankers

#30

Post by chowells »

senordevnyc wrote: post #16
forgetfreeman wrote: post #3

Pretty much. Given the levels of investment in capital and research if AI companies actually hit what they're aiming at they'd have to collapse the labor market to recoup, bricking the economy in the process. Given the levels of outside investment inflating valuations, if the bubble pops it's 2008 all over again. There's this incredibly narrow window of "just useful enough to extract rents" where everything doesn't g…

Extract rents? I don’t think you’re using the term rent correctly here.

No, it's correct. The best (short-term) case is that they become eternal parasites. If they fail to do that, they'll bring a lot down with them when they fall.
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