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The biggest sign of an AI bubble is starting to appear – debt

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Re: The biggest sign of an AI bubble is starting to appear – debt

#71

Post by MarcelOlsz »

infecto wrote: post #65
MarcelOlsz wrote: post #50

Earlier quoted context omitted.

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.

Dismissing an entire technology because you personally haven’t figured out how to make it useful is a cope, not an argument. Am I rich? What are you even on about. I can now spend a few dollars and classify a large dataset that would have taken me real time before. I can again spend a few dollars and turn unstructured data into structure. There absolutely is value to be found in the current gen of tech. Comparing it…

>Am I rich? What are you even on about.

The only people I find harping on about some amorphous "value" floating around in the air are typically people with portfolios.

>I can again spend a few dollars and turn unstructured data into structure.

Saving 5 seconds on a 10 second task using an infinite amount more energy is not "value", it's garbage propped up by VC money and regular people are going to be paying for it when it inevitably goes tits up. Like we've paid for everything. There's your "value".

Re: The biggest sign of an AI bubble is starting to appear – debt

#72

Post by SoftTalker »

thechao wrote: post #8

Dang. My kids are just getting the hang of using ChatGPT as a way to generate random quizzes and additional homework problems; to the point where both of them just automatically use the AI to "fill in the gaps" each evening. (Prior to AI, additional HW was met with less enthusiasm than you'd think!) I told my wife that the billionaire class spent the last few decades cheating the tax system (and, thus, the education…

Are you paying anything for it?

Re: The biggest sign of an AI bubble is starting to appear – debt

#73

Post by zerosizedweasle »

zero_shift wrote: post #66
qsort wrote: post #22

Earlier quoted context omitted.

> 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...

Continuing the masquerade will only make things worse

Yeah, it's like an infection. Do you want to deal with it now, when it's painful and you'll lose your finger or when you risk your arm, or risk dying of Sepsis. You can put off the pain but that will make the outcome worse.

Re: The biggest sign of an AI bubble is starting to appear – debt

#74

Post by diggan »

EcommerceFlow wrote: post #54

- ChatGPT still lags for me daily and I'm on a PRO subscription. - SORA is usable but extremely slow and constrained. - Image gen same thing, but getting a bit quicker and less constrained. This is with agents not having taken off yet, and the vast portion of the world economy not interacting with LLM Ai? Agents alone will require ungodly amounts of compute. Bullish

> ChatGPT still lags for me daily

What exactly are you referring to? Their UI seems to have troubles to load the list of conversations since like a week back, otherwise it seems fine? I mean, UX could be a lot better, but I'm experiencing anything I'd describe as "lag".

Re: The biggest sign of an AI bubble is starting to appear – debt

#75

Post by [deleted] »

fhd2 wrote: post #20
JCM9 wrote: post #4

The 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.

[deleted]

Re: The biggest sign of an AI bubble is starting to appear – debt

#76

Post by infecto »

MarcelOlsz wrote: post #71
infecto wrote: post #65

Earlier quoted context omitted.

Dismissing an entire technology because you personally haven’t figured out how to make it useful is a cope, not an argument. Am I rich? What are you even on about. I can now spend a few dollars and classify a large dataset that would have taken me real time before. I can again spend a few dollars and turn unstructured data into structure. There absolutely is value to be found in the current gen of tech. Comparing it…

>Am I rich? What are you even on about. The only people I find harping on about some amorphous "value" floating around in the air are typically people with portfolios. >I can again spend a few dollars and turn unstructured data into structure. Saving 5 seconds on a 10 second task using an infinite amount more energy is not "value", it's garbage propped up by VC money and regular people are going to be paying for it w…

You’re confusing your frustration with some half-baked React scaffolding with the entire field. “Saving 5 seconds on a 10 second task” is just a strawman, there are workloads where it saves weeks, even months. If you can’t see that, fine, but don’t pretend your blind spot is universal truth.

And spare me the VC boogeyman. The fact that capital flows into bad bets doesn’t erase the actual wins. We’ve had garbage propped up before, railroads, dot-coms, mobile apps but guess what? Railroads exist, the internet exists, mobile exists. Same pattern here.

Re: The biggest sign of an AI bubble is starting to appear – debt

#77

Post by alephnerd »

JCM9 wrote: post #48
fhd2 wrote: post #20

Earlier quoted context omitted.

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 bigges…

I'd say you are underestimating the industries being propped up by the AI Boom.

To name a few examples - Construction (the industry pivoted to DCs) [0], the entire hardware industry (from personal experience CHIPS act recipients pivoted to AI-hype because of slow reimbursement rates), whatever tech hiring that even exists in the US at this point is itself looped into and justified by the AI boom or capital that is 1-2 degrees removed from the AI boom, the entire energy industry is tied to the AI boom [1], and the renewables industry in the US is increasingly AI-washed now as well [2] because of the ending of IRA and IIJA disbursements under Trump.

This wouldn't be a 2008 sized event, but it would be a bloodbath comparable to the Telecom Bust (2001) and the Dot Com Bust (2001). I would trust that every HNer would be worried about such a situation because of how existential a risk it would be for the entire tech industry - which employs most people on this forum.

[0] - https://www.mckinsey.com/featured-insights/themes/whos-fundi...

[1] - https://www.politico.com/news/magazine/2025/08/05/energy-ind...

[2] - https://www.bloomberg.com/news/articles/2025-09-26/ai-boom-w...

Re: The biggest sign of an AI bubble is starting to appear – debt

#78

Post by svara »

When you look at total real returns over longer time scales, the current period in time is not unusual.

https://totalrealreturns.com/s/SPY

We're not far from the long term trend of 6.15%/yr on the S&P500, just slightly above.

The deviation above the long-term trend was much larger in the run-up to 2001. It's like we're in 1997 now.

Not saying a correction isn't likely, just that it's easy to scare yourself by looking at linear, non-inflation adjusted plots.

Re: The biggest sign of an AI bubble is starting to appear – debt

#80

Post by algorithmmonkey »

infecto wrote: post #53
369548684892826 wrote: post #43

Earlier quoted context omitted.

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.

Inference costs are largely break even and profitable. Now yes there is absolutely questions on the training side. You could turn off the switch today though and most of your leading models could keep the lights on.

I keep seeing everyone guessing what the margin is on inference. You say that it's largely break even. We have this person in the thread claim 80% margin (https://news.ycombinator.com/item?id=45462442).

These numbers are complete make believe.

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