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Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

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Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#71

Post by gjsman-1000 »

whimsicalism wrote: post #64
gjsman-1000 wrote: post #61

Earlier quoted context omitted.

> Tax increases may also help. I don't live in a costal state, but when I do consulting work typically at charity rates alongside my standard full-time job, I have to pay 24% federal tax, 15.3% FICA, and 7.85% state tax. I am already taxed whenever I want to help anyone at 47.15% . That's before the required tax structures and consulting for doing all the invoicing legally. God himself only wanted 10%, so it seems a…

You're talking about your marginal rate and we simply are far to the left on the laffer curve, raising taxes will raise revenue. I'm not unsympathetic, my marginal is close to the same - but generally I think people's claims that they will stop working are generally more bark than bite and the evidence largely backs that up. If you don't want a tax-based solution, I do hope you are agitating for SS and medicare cuts.

> we simply are far to the left on the laffer curve, raising taxes will raise revenue

I don't believe this, actually. I think that we will raise more revenue, yes, by squeezing more from the Fortune 500; but you will absolutely crush small business and consultancy work further. It's kind of like how an 80% tax rate on everyone making over $100K would do a fantastic job of raising revenue, but it's fundamentally stupid and would kill all future golden geese.

(On that note, I see this comment a lot about how we had huge tax rates, 91% in the 1950s; but this is misleading. The effective tax rate for those earners was only 41%, due to the sheer number of exemptions, according to modern analysis. We have never had an actual effective 91% tax rate, or anywhere close to it. Those rates were theater, never reality.)

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#72

Post by an0malous »

regularfry wrote: post #62
an0malous wrote: post #40

Earlier quoted context omitted.

I used to believe in AGI but the more AI has advanced the more I’ve come to realize that there’s no magic level of intelligence that can cure cancer and figure out warp drives. You need data, which requires experimentation, which requires labor and resources of which there is a finite supply. If you had AGI tomorrow and asked it to cure cancer, it would just ask for more experimental data and resources. Isn’t that wh…

AGI isn't a synonym for smarter-than-human.

What’s your point? I’m saying there’s no level of smartness that can cure cancer, the bottleneck is data and experimentation not a shortage of smartness/intelligence

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#73

Post by nobleach »

rkomorn wrote: post #12
ratelimitsteve wrote: post #10

this is how capitalism does things. no one wants to overinvest but no one wants to be left behind and everyone is sure that either there's not gonna be a pop or they can sell before it pops. it has been educational to see how quickly the financier class has moved when they saw an opportunity to abandon labor entirely, though. that's worth remembering when they talk about how this system is the best one for everyone.

Zero labor cost is the dream!

To whom does one sell when they've deleted their workforce? Seeing company after company add to unemployed workers shows they have no forward-thinking ecomonomists advising them. Further, AI for all of its positive potential is NOT going to be free... or even "cheap" once the investors dry up.

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#74

Post by karmakurtisaani »

marbro wrote: post #54
CraigJPerry wrote: post #24

Earlier quoted context omitted.

>> sovereign debt burden So all the entities that want to hold the debt (social security administration, mutual funds, pension funds etc) where should they go instead? Riskier assets is what you're saying right? Is that a great idea?

All investors should choose gold over the dollar because paper money is always debased. Organizations like Apple, Microsoft, and Google bought government bonds 10 years ago when the price of gold was $1100 and have watched their investments erode while gold has increased to $4000.

Do you also give forward looking investment advice, or strictly limit to looking what would have worked 10 years ago?

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#75

Post by lossolo »

an0malous wrote: post #40
estomagordo wrote: post #17

Earlier quoted context omitted.

What's a sign it's going to happen ever?

I used to believe in AGI but the more AI has advanced the more I’ve come to realize that there’s no magic level of intelligence that can cure cancer and figure out warp drives. You need data, which requires experimentation, which requires labor and resources of which there is a finite supply. If you had AGI tomorrow and asked it to cure cancer, it would just ask for more experimental data and resources. Isn’t that wh…

Generally, I agree, but it also depends on perspective. Intelligence exists on many levels and manifests differently across species. From a monkey's standpoint, if they were capable of such reflection they might perceive themselves as the most capable creatures in their environment. Yet, humans possess cognitive abilities that go far beyond that, abstract reasoning, cumulative culture, large scale cooperation etc

A chimpanzee can use tools and solve problems, but it will never construct a factory, design an iPhone, or build even a simple wooden house. Humans can, because our intelligence operates at a qualitatively different level.

As humans, we can easily visualize and reason about 2D and 3D spaces, it's natural because our sensory systems evolved to navigate a 3D world. But can we truly conceive of a million dimensions, let alone visualize them? We can describe them mathematically, but not intuitively grasp them. Our brains are not built for that kind of complexity.

Now imagine a form of intelligence that can directly perceive and reason about such high dimensional structures. Entirely new kinds of understanding and capabilities might emerge. If a being could fully comprehend the underlying rules of the universe, it might not need to perform physical experiments at all, it could simply simulate outcomes internally.

Of course that's speculative, but it just illustrates how deeply intelligence is shaped and limited by its biological foundation.

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#76

Post by nobleach »

forinti wrote: post #19
ratelimitsteve wrote: post #10

this is how capitalism does things. no one wants to overinvest but no one wants to be left behind and everyone is sure that either there's not gonna be a pop or they can sell before it pops. it has been educational to see how quickly the financier class has moved when they saw an opportunity to abandon labor entirely, though. that's worth remembering when they talk about how this system is the best one for everyone.

Leaving large portions of the population jobless surely can't be good for business and political stability.

This is what's making me laugh a bit about Ford's brazen "we're firing all the white-collar workers" nonsense. Ok, go for it. Who are you going to get to buy a $80,000 F-150?

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#77

Post by Theodores »

whimsicalism wrote: post #14

AI is a risk. The thing we know is going to bite us in the butt is our continued massive sovereign debt burden and lack of any political will whatsoever to either increase taxes or reduce spending. The dollar is not going to do well this century and creditors confidence is already starting to decline. In fact, the further we go into debt - the more we are implicitly betting our society on an AI hail mary.

Approximately half the S&P500 is in the Magnificent Seven. It doesn't matter what they sell, there is just too much money there. Calling this situation an 'AI risk' is disingenuous, or at best blinkered.

Everyone outside of the American empire knows that the gig is up. When Uncle Sam has his money printing press on full blast, the American people don't feel the full effect, but everyone in the global majority, where there are no dollar printing machines, gets to see too many dollars chasing the same goods, a.k.a. inflation.

The day when the American people elect a fiscally prudent government, for Americans to work hard, pay their taxes and get that deficit to a manageable number is never going to happen. But that is not a problem, the situation is out of America's hands now.

It was the 2022 sanctions on Russia that made the BRICS alliance take note. Freezing their foreign reserves was not well received. Hence we now have China trading in their own currency with their trading partners happy with that.

Soon we will have a situation where there is no 'exorbitant privilege' (reserve currency, which can only ever end up with massive deficits), instead the various BRICS currencies will be anchored to valuable commodities such as rare earth metals, gold and everything else that is 'proof of work' and important to the future. So that means no more 'petro-dollar', the store of value won't be hydrocarbons.

This sounds better than going back to a gold standard. As I see it, the problem with the gold standard is that you kind of know already who has all the gold and we don't want them to be the masters of the universe, because it will be the same bankers.

As for an AI 'Hail Mary', I do hope so. The money printed by Uncle Sam to end up in the Magnificent Seven means that it will be relatively easy to write this money off.

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#78

Post by rkomorn »

nobleach wrote: post #73
rkomorn wrote: post #12

Earlier quoted context omitted.

Zero labor cost is the dream!

To whom does one sell when they've deleted their workforce? Seeing company after company add to unemployed workers shows they have no forward-thinking ecomonomists advising them. Further, AI for all of its positive potential is NOT going to be free... or even "cheap" once the investors dry up.

I never said it was a smart dream. It all seems somewhat (at best) shortsighted to me.

I'm pretty sure they all see the it as someone else's problem to solve.

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#79

Post by whimsicalism »

gjsman-1000 wrote: post #71
whimsicalism wrote: post #64

Earlier quoted context omitted.

You're talking about your marginal rate and we simply are far to the left on the laffer curve, raising taxes will raise revenue. I'm not unsympathetic, my marginal is close to the same - but generally I think people's claims that they will stop working are generally more bark than bite and the evidence largely backs that up. If you don't want a tax-based solution, I do hope you are agitating for SS and medicare cuts.

> we simply are far to the left on the laffer curve, raising taxes will raise revenue I don't believe this, actually. I think that we will raise more revenue, yes, by squeezing more from the Fortune 500; but you will absolutely crush small business and consultancy work further. It's kind of like how an 80% tax rate on everyone making over $100K would do a fantastic job of raising revenue, but it's fundamentally stupi…

pretty much all modern economists disagree with you https://kentclarkcenter.org/surveys/laffer-curve/

Re: Bank of England flags risk of 'sudden correction' in tech stocks inflated by AI

#80

Post by gjsman-1000 »

whimsicalism wrote: post #79
gjsman-1000 wrote: post #71

Earlier quoted context omitted.

> we simply are far to the left on the laffer curve, raising taxes will raise revenue I don't believe this, actually. I think that we will raise more revenue, yes, by squeezing more from the Fortune 500; but you will absolutely crush small business and consultancy work further. It's kind of like how an 80% tax rate on everyone making over $100K would do a fantastic job of raising revenue, but it's fundamentally stupi…

pretty much all modern economists disagree with you https://kentclarkcenter.org/surveys/laffer-curve/

... in 2012?
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