The tech market is fundamentally fucked up and AI is just a scapegoat

Excellent points. You've perfectly described the brutal, interest-rate-driven VC cycle -- capital floods in, risk gets mispriced, and the market eventually corrects with Darwinian force. That's the "blunt instrument" in action.

Meanwhile in China, the approach is fundamentally different. Capital isn't just cheap; it's strategically directed by the state with goals beyond financial return. The aim is "new quality productive forces" -- slow-burn, systemic growth that reinforces social stability and industrial upgrade, not a boom-bust race for unicorns.

The current AI boom is our real-time experiment to see if this is the "better way." The U.S. model, as you note, is driven by massive private investment (over $109B in 2024) and is prone to hype cycles. China's model is state-planned, focusing on the "AI Plus" integration of technology across its industrial base, despite investing less ($9.3B) and facing constraints like advanced semiconductor access.

We're watching two competing logics: one seeking market-defining breakthroughs through volatile, capital-intensive competition, and another pursuing broad-based, stability-oriented technological integration. The results of this test will show which system better transforms capital into lasting, system-wide advantage.

I mostly agree with your assessment of the industry. However, I think there are still more new and useful products to be built. They are not “the next big thing” though. Big tech Management has been screwing this up in a couple of ways though.

1. prioritizing bets for things that could be as profitable as social media or e-commerce instead of betting on more incremental improvement products.

2. Focusing on pricing everything with reoccurring revenue and thus increasing the lifetime cost for end users instead of selling products at a discrete costs and providing end users value

3. Optimizing for growth and controlling the vision of products instead of letting small groups of talented people slowly build products.

4. Treating people as fungible resources and moving them around all the time rather than letting people develop unique expertise skillsets.

As a result, any product that can’t achieve $10+ billion annual revenue within a couple of years with a ship of Theseus team is deemed a failure and scrapped.

IMO the issue is even more fundamental than the article presents. The software product market is approaching a saturation point. All the low hanging fruit has been commoditized, so buying something off the shelf is now generally preferable to having engineers on your staff. After the pandemic hiring spree, even the big tech companies realized they didn't have enough productive work for all these engineers. The effect is compounded by the return to normal interest rates, so investors are no longer desperate to dump their cash into every random startup idea. Ultimately, software engineers aren't going away, but the era of desperate need is over for good.

Yes, most employers in tech are not looking for published academics. That’s a bit of an oversimplification.

The actual problem is that developers are made into a commodity because they are an unvalued cost center. Developers do not make money. They only take money. So, the goal is to not train them and replace them as conveniently as possible.

The result is to not look for talent but instead equate the requirements to a lowest common denominator. That minimizes personnel management friction at cost to everything else. We all know this. The real concern for developers is why that is allowed to occur in software but not other professions.

1. Mass hysteria.

2. Central banks rotating into gold to de-risk from USD combined with their usual slow bureaucratic processes. By the time they've decided that gold needs to be bought, the price has already run up by 50% and it's no longer a good idea to buy, but they still need to execute on their decisions anyway.

The USD isn't going anywhere for the simple reason that the USA can simply counterfeit any non-USD currency and there's nothing the issuer can do about it, whereas if anyone tries to counterfeit USD, they should expect a nice little missile to land inside their room no matter where they are in the world. "Reserve currency" status is entirely based on how effective the issuing entity is at taking care of counterfeiting.