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AI Is the Bubble to Burst Them All

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Re: AI Is the Bubble to Burst Them All

#31

Post by spectralista »

ericb wrote: post #18
yalogin wrote: post #12

I am split on this, this is definitely a bubble but I don’t know if it’s going to crash or wipe out countries. The problem here is the tech is real and has great promise. This is not AGI but llms can make the promise of robots real, by it may take a long time for it to materialize just like with self driving cars. So the hype can subside but it needs an impetus to slide. It may or may not happen and even if it does,…

> the tech is real and has great promise. This was very true of the dotcom bubble. The entire "web" was new, and the promise was everything you use it for today . Pets.com was a laughing stock for years as an example of dotcom excess, and now we have chewy.com, successfully running the same model. Webvan.com, was a similar example of "excess" and now we have Instacart and others. I looked up webvan just now--the post…

This to me is the whole bubble.

The problem of dotcom is we needed a cultural shift. I had my first internet date during the dot com bubble and I remember we would lie to people about how we met because the idea sounded so insane at the time to basically everyone. In 1999 it seemed kind of crazy to even use your real name online let alone put your credit card into the web browser.

Put your credit card into the internet browser then a stranger brings you items in their van? Completely insane culturally in 1999. It would have sounded like the start of an Unsolved Mysteries episode to the average person in 1999. There was no market for that in 1999.

The lesson I take from dotcom is we had this massive bubble and burst over technology that already existed, worked flawlessly and largely just needed time for the culture to adapt to it.

The main difference this time is we are pricing in technology that doesn't actually exist.

I can't think of another bubble that was based on something that doesn't exist. The closest analogy I can think of is the railroad bubble but with the trains not actually existing outside of some vague theoretical idea that we don't actually know how to build. A bubble in laying down rail because of how big it will be when we figure out how to build the trains.

The only way you would get a bubble that stupid would be to have 50-100 years of art, stories and movies priming the entire population on the inevitability of the train.

Re: AI Is the Bubble to Burst Them All

#32

Post by sumedh »

fzeroracer wrote: post #30
wilg wrote: post #13

Earlier quoted context omitted.

I suspect that isn't true

We're at a record number of subprime borrowers falling behind on car loans, which historically is a really bad economical sign, consumer sentiment is at an all time low and the labor market isn't looking great either. Anecdotally, prices have risen sharply and people are getting sharply priced out of basic necessities due to rising costs.

Can you please share a link with the data?

Re: AI Is the Bubble to Burst Them All

#33

Post by pinkmuffinere »

yalogin wrote: post #12

I am split on this, this is definitely a bubble but I don’t know if it’s going to crash or wipe out countries. The problem here is the tech is real and has great promise. This is not AGI but llms can make the promise of robots real, by it may take a long time for it to materialize just like with self driving cars. So the hype can subside but it needs an impetus to slide. It may or may not happen and even if it does,…

> llms can make the promise of robots real

I think this is a very large overstatement. Many large problems still exist in robotics which can not be papered over with LLMs. I’m familiar with problems in manipulation and affordable sensing, which will not be solved via llms, and are fundamentally necessary for reliable and safe interaction with the real world. I’m confident there are many others. LLMs probably will help with high level planning. But that’s a subset of the many problems that keep robots from becoming mass market products.

I think people are excited about robotics because of the many demo videos that have been coming out of various companies. However, almost all of these videos are smoke and mirrors. If you ask somebody who works on those demos, they will unashamedly tell you all the ways they worked around their technical limitations to get just the right footage. The PR departments are less upfront with that info.

Re: AI Is the Bubble to Burst Them All

#34

Post by iJohnDoe »

If it’s a bubble because some large and small companies will collapse, then yes, there is a bubble waiting to burst.

OpenAI, NVIDIA, Microsoft, Apple, Amazon, etc. obviously won’t collapse.

The money being thrown around is mind boggling. However, we’ve been throwing this type of money around for a handful of years now.

Tons of layoffs, homelessness, corruption, unemployment, difficulties for everyone to find a job, the incoming SNAP meltdown, government shutdown and the mess it’s going to cause for a while. None of it makes sense. It’s pure crazy because everything should have imploded by now. The tech layoffs and government layoffs alone should be causing a shitstorm of misery out there, but it’s hidden somehow.

AI isn’t going away. It’s here to stay. It has already become embedded into so many core things we do everyday. So many jobs are affected by it. Like, marketing, graphic design, writing, so many jobs in hollywood, like storyboarding and voiceover work, and the creative process of so many things. So many scenes today in movies are CGI and it’s hard to tell, like 3-second scenes, or CGI overlays. All of that will be created with a prompt in the next couple of years. Sure, some editing will be needed for the generated scenes, but with far less staff. The key takeaway here is that this equates to millions of jobs vanishing rather quickly. Core jobs that people of all ages based their careers on.

Don’t get lost in the details of AI generating garbage or not. The remaining companies that survive will continue to make it better. Don’t think for a second there will be a resurgence in these jobs coming back because everyone thinks a human can do it better.

All those data center GPU buildouts will not go waste. We’re headed for a dystopia that’s even worse than the one we’re living in right now.

Wait until a few people are killed by police for stealing food from a grocery story because they are starving and need to feed their families. It will be the first time we get close to a civil war becoming a reality.

Re: AI Is the Bubble to Burst Them All

#35

Post by fzeroracer »

sumedh wrote: post #32
fzeroracer wrote: post #30

Earlier quoted context omitted.

We're at a record number of subprime borrowers falling behind on car loans, which historically is a really bad economical sign, consumer sentiment is at an all time low and the labor market isn't looking great either. Anecdotally, prices have risen sharply and people are getting sharply priced out of basic necessities due to rising costs.

Can you please share a link with the data?

The subprime loan data can be seen here [1] and consumer sentiment here [2]. Job losses are much harder to estimate given that the current admin is actively refusing to post job numbers (for perhaps, obvious reasons) but we've seen other sites estimate that we're seeing record layoffs [3]. And that's before we get into stuff like tariff policy or the hidden costs of throwing a lot of government employees into unemployment.

[1] https://www.reuters.com/business/autos-transportation/record...

[2] https://www.sca.isr.umich.edu

[3] https://www.cbsnews.com/video/october-marks-worst-layoffs-22...

Re: AI Is the Bubble to Burst Them All

#36

Post by handoflixue »

jbritton wrote: post #24
fl7305 wrote: post #17

Earlier quoted context omitted.

> LLMs don’t really reason Do you have a test for this? Or is it based on the presumption that reasoning skills cannot evolve, it can only be the result of "intelligent design"?

I have been spent many hours with them on coding tasks. As things currently stand once context or complexity reaches a certain point they become completely incapable of solving problems and that point occurs on very simple things. They appear completely brain dead at times although they are magnificent liars at making you think they understand the problem. Although, I recently got chatGPT 5 to solve a problem in a co…

Would you agree that many humans, especially younger ones, are also incapable of reasoning?

Re: AI Is the Bubble to Burst Them All

#37

Post by throw234234234 »

iJohnDoe wrote: post #34

If it’s a bubble because some large and small companies will collapse, then yes, there is a bubble waiting to burst. OpenAI, NVIDIA, Microsoft, Apple, Amazon, etc. obviously won’t collapse. The money being thrown around is mind boggling. However, we’ve been throwing this type of money around for a handful of years now. Tons of layoffs, homelessness, corruption, unemployment, difficulties for everyone to find a job, t…

Its amazing what the invention of the transformer architecture has achieved; even if the above doesn't come to the past it has sparked discussion of the above possibilities. For a simple idea/algorithm to have changed the world or at least people's future outlook to bleak dystopia; to create mass stock valuations, to justify the business layoffs that have happened and more is definitely significant and much more than I would of imagined just a few years ago.

I'm amazed at the sheer volume of resources allocated to the above so quickly for example; more than any other boom I've seen. Society can raise trillions quickly if it means not employing people I guess? Knowing basic economics I don't buy the utopia case with AI for the majority of people, particularly the middle class. To be clear most people I meet anecdotally (especially outside the tech space) are net negative on the changes AI is doing to their lives, even if they are in jobs like trades.

It has had a profound impact; probably much more (no matter which camp wins the argument, bulls or bears on AI) than its inventors ever thought it would. It makes me think of whether the people who invented this, once they see the end result, will be happy with their invention and the changes it will create in the world. If they aren't happy in hindsight it says something about the unfortunately all too common naivete of the techie in general and the impact of their work on society/economics/etc until it does eventually occur.

Re: AI Is the Bubble to Burst Them All

#38

Post by hnfong »

bdangubic wrote: post #29
diamond559 wrote: post #19

Earlier quoted context omitted.

The impetus is that 90% of our country is in recession and the rest are soon to follow. Delinquencies are rising fast and not just in subprime. Layoffs are at levels not seen since 2008. Crypto, tech stocks and many housing markets have already peaked or are already in bear markets. The crash is here and it's inevitably going to get worse.

all true - but none of this is actually “ai bubble”

Betting on "growth powered by AI" is the only thing keeping valuations up at this point..

Re: AI Is the Bubble to Burst Them All

#39

Post by fy20 »

bgwalter wrote: post #16
bofadeez wrote: post #3

During most of the dot-com boom, there was not a broad consensus that a bubble existed, whereas today’s AI boom is widely accompanied by media warnings about an AI bubble, making public awareness much higher than it was in the late 1990s. I don't think a single person hasn't heard the "circular financing" talking points from multiple people who think they're being insightful. Or Burry who thinks a GPU should be trash…

Greenspan warned about irrational exuberance, the newspapers were full of articles like the Guardian one: https://www.stlouisfed.org/publications/regional-economist/a... https://www.theguardian.com/business/1999/dec/20/nasdaq.efin... This time, "AI" has been hyped up more than tech in 1999 by the media. The media has just reversed course in 2025 because they found out that most people hate "AI". in 2023-2024 it was m…

This line from The Guardian article:

"The notion that Amazon.com will be allowed to corner the market in on-line book sales is wholly implausible."

Re: AI Is the Bubble to Burst Them All

#40

Post by hnfong »

saxenaabhi wrote: post #27
ericb wrote: post #18

Earlier quoted context omitted.

> the tech is real and has great promise. This was very true of the dotcom bubble. The entire "web" was new, and the promise was everything you use it for today . Pets.com was a laughing stock for years as an example of dotcom excess, and now we have chewy.com, successfully running the same model. Webvan.com, was a similar example of "excess" and now we have Instacart and others. I looked up webvan just now--the post…

Isn't openAI already profitable on inference? I understand training is still costly, but it's not unimaginable for it to turn profitable as well if you think believe they'll generate trillions in value by eliminating millions of jobs.

If you eliminate ONE job and let's say the job pays $100K, in theory at most $100K goes instead to AI revenue. In practice it's a lot less, nobody is going to move everything to AI if it's just a 10% saving.

So, to get a trillion in value, you'd have to eliminate many tens or even hundreds of millions of jobs.

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