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How accurate have Ed Zitron's AI skeptic predictions been?

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Re: How accurate have Ed Zitron's AI skeptic predictions been?

#201

Post by swiftcoder »

simonw wrote: post #91
swiftcoder wrote: post #74

> Given how fast these companies are growing (in terms of revenue and profit), it doesn't seem that AI is, as Zitron implied, some kind of desperation move they're reaching for because "they don't know how to grow" and are all out of ideas Growth isn't a valid rebuttal, unless we can also sus out how much of that growth is tied up in circular financing of AI projects. We have a pretty good idea how much of Nvidia's v…

As public companies, the megascalers publish pretty detailed financial reports.

Financial reports alone don’t paint the whole picture when it comes to valuations. For example, theoretically amazon has committed to invest 25 billion in anthropic, and anthropic has committed to spend 100 billion on aws compute. As far as we can tell, no real money has actually changed hands in either direction, but both valuations are being buoyed by their prospective investments…

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#202

Post by infamouscow »

simonw wrote: post #91
swiftcoder wrote: post #74

> Given how fast these companies are growing (in terms of revenue and profit), it doesn't seem that AI is, as Zitron implied, some kind of desperation move they're reaching for because "they don't know how to grow" and are all out of ideas Growth isn't a valid rebuttal, unless we can also sus out how much of that growth is tied up in circular financing of AI projects. We have a pretty good idea how much of Nvidia's v…

As public companies, the megascalers publish pretty detailed financial reports.

Because of accounting tricks, quarterly financials don't accurately reflect the size of this fiery money pit.

The datacenter build-outs are all majority (>50% ownership) financed by other companies, with a shell company owned by the hyperscaler as a minority owner. The data center then grants the hyperscaler an exclusive leasing agreement, and because the shell company is a minority owner, legally, it's not their debt.

The only reason this has worked is because there's such a long delay taking delivery on GPUs. When these capital allocators start paying for GPUs in data centers which haven't yet broken ground, then we'll see a very visceral market reaction. Some of that has already happened, but there's enough momentum that it can be absorbed and dismissed as an anomaly. But with governments unexpectedly passing moratoriums on data centers everywhere, it's only a matter of time before there's no data center to offload those GPUs to. That's when the music stops.

I believe that was Zitron's central thesis and why he started reporting on this. It mirrors the mortgage-backed securities situation that led to the 2008 GFC, except with even fewer guard rails to prevent financial calamity.

Investors are very savvy and keenly aware of what's going to happen. There's just zero incentive to pull the fire alarm and risk being blamed for crashing the market. If you're wondering why everyone's running toward the exits instead of treating these tech companies as 10+ year investments, you have your answer.

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#204

Post by Calazon »

pocksuppet wrote: post #75
devindotcom wrote: post #31

Earlier quoted context omitted.

>one's chosen enemies must be simultaneously terrifyingly powerful and incompetent dunces I've got some bad news for you.

At first I thought you were referring to Umberto Eco's laws of fascism: "Fascist societies rhetorically cast their enemies as at the same time too strong and too weak." but it's subtly different, because incompetence is not weakness.

I read it as suggesting that AI models are simultaneously terrifyingly powerful and incompetent dunces.

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#205

Post by HDThoreaun »

12sag15 wrote: post #60

As always, shooting down commentary asking for more and more evidence is very simple. Zitron has a somewhat ranting style. Luu's passage on Google search for example just nitpicks on the person that Zitron allegedly named as responsible for the decline of Google search. The real issue of course is that search quality clearly has gone down. What does Luu want? A "study"? Everyone can see that. The person is not the is…

The issue is the conspiracy. By pinning the whole problem on a single villain rather than the incentives the larger organization has created he 1. doesnt help solve the problem 2. creates an environment ripe for tribalism. Even if you ignore the racist undertones(fine its a stretch) he's still misleading people about what is happening.

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#206

Post by [deleted] »

pcstl wrote: post #5

Zitron has become the distorted reflection of the very AI boosters he criticizes and mocks. I think the worst thing that happened to him was AI skepticism becoming a political position . This gave him a captive audience - as long as he says what they want to hear , which means that he can never ever concede that he might have been wrong or that AI might actually be progressing or having successes. This is not conduci…

[deleted]

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#207

Post by delis-thumbs-7e »

I don’t really care of anyone’s predictions, whether that of Altman or Zitron. I can make a prediction that sun will collapse into itself and stop shining. I would probably be right as long as I don’t give any too strict timeframe to ky prediction. In terms of Zitron, his style is that of a British tabloid columnist. It’s rather refreshing when most tech journalism is just selling gadgets, stock or whatever without questioning at all what either Musk, Altman, Amodei or whoever says. It aggravates many people because, well, it is suppose to.

Regardless of whether you love LLM’s as technology, the financial realities of Anthropic and especially OpenAI really does not look good. They have a massive expenditure that they need to keep going in order to make profits, which at least in terms of OpenAI are horrendously behind. Zitron published these numbers together with Financial Times, so you gotta give him that at least. Meanwhile the CEO’s talk all kind of nonsense and give their own predictions to get more investors money to fund what might or might not be the biggest bubble in the history of finance. I certainly do not hope this happens, since the consequences would be horrific. But there is likely to be a some sort of correction in horizon, since the models will plateau and they will run out of money at some point.

Let me finish with my own prediction. I think a lot of people are going to lose a lot of money some time next couple of years.

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#208

Post by bogzz »

simonw wrote: post #3

> For any of his posts that I read, while there are numbers thrown around, the numbers don't actually connect to a coherent argument. In many cases, as we saw above, the numbers don't even really support his argument (such as an MAU decline in Facebook causing Meta financial problems which would then cause Meta to spuriously insert AI in places it doesn't belong). I suspect he's relying on people's eyes glazing over…

[flagged]

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#209

Post by rawgabbit »

This kind of back and forth reminds me of the Dot Com bubble circa 1999. There were endless articles saying that the internet was a new golden era for mankind and that the hyperbolic company valuations were justified; the detractors cried bullocks.

I use AI every day as I assume everyone else on Hacker News does. Will the S&P 500 drop 20%? I have no idea. If you know, please let me know so I can adjust by 401K.

Re: How accurate have Ed Zitron's AI skeptic predictions been?

#210

Post by ant_li0n »

maxglute wrote: post #200
ant_li0n wrote: post #188

Earlier quoted context omitted.

(edited to remove snark) Your comment seems to miss the point that the article does not (necessarily) have a problem with Zitron being insufferable/annoying/smug. It's that his predictions are verifiably wrong. It's one thing to be annoying and right. Zitron is annoying, but not right.

Yes? What happened to FAANG in last 3 years, they cut a fuck load of jobs, the raised rent/prices, then inflation, then experience surge in new category AI. 1 + 2, i.e. squeezing rock has limits. 3 is fundamentally not sustainable, i.e. AI revenue gap order of magnitude relative to spend. This like debt crisis, there's lot of levers to burn to maximize extraction and make ledger look good short term, but is fundament…

Ah I understand what you're saying. Yes I agree that if you pull back to, "We're in a bubble," then you can say that Zitron is correct, at least fundamentally, despite being wildly inaccurate in almost every other prediction he makes.

But Zitron isn't just blogging about how we're in a bubble. The assertions he makes are not minutiae, he basically continuously says that all the big SW firms are walking corpses. He's not having a rational conversation about the long term prospects for companies who invest in AI. There is a population of people who (rightfully) hate Google et al and want them to fail, and he just stokes their anger and frustration.

He doesn't add anything substantial, and (as the article indicates), even when he brings economic figures into the conversation, he's frequently wrong or misrepresents them.

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