Earlier quoted context omitted.
I hope it all burns. Zero sympathy whatsoever for AI-anything. It's all a heaping pile of trash.
You hope the garbage heap surrounding your house burns?
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The biggest sign of an AI bubble is starting to appear – debt
41–50 of 129 posts
Re: The biggest sign of an AI bubble is starting to appear – debt
#42Re: The biggest sign of an AI bubble is starting to appear – debt
#43The thing is, the models do work. They add value to me each and every day, to a degree almost no other tech has done before. But that doesn't take away the fact that this is extremely expensive stuff (not for me, but for the companies pushing the envelope), far too expensive. And it is really taking its toll on other resources, like electricity.
I think the thing that most of the folks miss is exactly that. AI is adding value and it’s here to stay. Absolutely the OpenAI story is looking concerning but I am not sure it is this doomsday AI winter.
If revenue doesn't catch up with the cost of developing and running these huge LLMs then the only way to avoid an AI winter is to find a way to make them way cheaper to develop.
Re: The biggest sign of an AI bubble is starting to appear – debt
#44Earlier quoted context omitted.
> I hope I’m wrong I kind of hope you're right. Any "hyped" industry/sector is bound to eventually needing to get back to reality, and focus on things that actually work, rather than spraying and praying prototypes and over-hyping them. The individuals and companies building real products that actually improve something will stick around, either as they are, or at least as ideas, and most of the interesting stuff ten…
> I kind of hope you're right. I couldn't care less if big tech gets knocked down a peg, but in many quarters the AI boom is what's keeping the lights on. A market correction of that magnitude would mean a lot of pain for a lot of normal people, it's not exactly something I'm cheering on...
But not knocking it down will also mean a lot of pain for the people? Just look at the unsustainable electricity demand and skyrocketing prices big tech is pushing upon the small folk due to their explosive needs for more and more big data centers.
Re: The biggest sign of an AI bubble is starting to appear – debt
#45Is there a bubble? Maybe. Will all of the current companies exist 5 years from now? Probably not. Is AI generating value and here to stay. Absolutely.
Can "AI" make me a React component that doesn't blow up in my fucking face? Absolutely not.
That itself is not proof that AI is not here to stay. It’s a short minded world view. Value is absolutely being generated but of course not everywhere and I am certainly not defending valuations.
Re: The biggest sign of an AI bubble is starting to appear – debt
#46The current bubble is getting scary. When this thing pops the blast it’s going to be a real mess. The big tech firms will hurt, fire some execs in a show of “making changes,” do a bunch of layoffs across “AI” teams to show the market they’re pivoting and getting costs in order, and move on. The startups ecosystem will suffer extensive and catastrophic damage. The funding ecosystem will be set back years as this wipes…
> The funding ecosystem will be set back years as this wipes out a bunch of VCs and investors I don’t think this is likely. We’ve seen VCs overextend into social networks, “sharing economy”, B2BSAAS, machine learning, developer tools, video games and crypto, in the last 15 years, and they have very little to show for it. Something new will come along and they’ll invest in that.
VCs typically invest money invested in them, so if that dries up, regardless of what dream they want to chase, they can't. The hypes you list all happened, but I don't think I've seen anything in the last 20 years that even comes close to the current AI hype.
Re: The biggest sign of an AI bubble is starting to appear – debt
#47The entire US stock market and economy is being prompted by AI since 2022. I think that the Economist posted some months ago a study that indicated that without datacenter capex booming the US economy would otherwise be flat. At some point there will be major shakeups.
It's just gotten so out of hand that there are multiple levels of pain. There's all the debt financing / private credit deals on infrastructure costs that will be defaulted on. There are the losses that most people will feel when the overvalued shares drop. There is the pain of tech companies having spent so many resources with very little in terms of viable revenue streams. It's gonna hit a lot of places in the economy.
Re: The biggest sign of an AI bubble is starting to appear – debt
#48The current bubble is getting scary. When this thing pops the blast it’s going to be a real mess. The big tech firms will hurt, fire some execs in a show of “making changes,” do a bunch of layoffs across “AI” teams to show the market they’re pivoting and getting costs in order, and move on. The startups ecosystem will suffer extensive and catastrophic damage. The funding ecosystem will be set back years as this wipes…
What about the rest of the economy? Deutsche Bank recently said that the AI hype is the only thing holding the US stock market together. And if that crashes, it tends to ripple world wide. Scary stuff, at least to someone who doesn't know all that much about market resilience. With what little I know, I'm hoping for a soft pop with slow deflation. But big tech seems to just pump harder right now.
Any big bust will have broader market implications, but I don’t think this has the broad systemic impact that the financial crisis did. It will likely be really ugly for those caught up in it, but a news story and minor blip to the 401k of everyone else. If you are well diversified keep your head down and keep going. If you’re a VC that heavily invested in AI, I suggest preparing for a Cat 5 hurricane now.
The biggest impact the average person will see is that the days of VC funded cheap AI will be over. If they want to use AI to cheat on their essay they’ll need to pay a lot more.
Re: The biggest sign of an AI bubble is starting to appear – debt
#49Not sure starting to appear is the right word
Coreweave had a huge chunk of debt and gpu financing was a thing even last year
Re: The biggest sign of an AI bubble is starting to appear – debt
#50Earlier quoted context omitted.
Can "AI" make me a React component that doesn't blow up in my fucking face? Absolutely not.
That itself is not proof that AI is not here to stay. It’s a short minded world view. Value is absolutely being generated but of course not everywhere and I am certainly not defending valuations.
Value is being generated for owners. Not for me. I don't care at all about "value". I don't know what perspective you are thinking from. Are you rich? AI and crypto and every flavor of the year tech garbage are just siphons. Judging the tech on its own merits is missing the forest for the trees.