He's (unsurprisingly) making an analogy to the dotcom bubble, which seems to me correct. There was a bubble, many non-viable companies got funded and died, and nevertheless the internet did eventually change everything.
The biggest problem is the infrastructure left behind from the Dotcom boom that laid the path for the current world (the high speed fiber) doesn't translate to computer chips. Are you still using intel chips from 1998? And the chips are such a huge cost, and being backed by debt but they depreciate in value exponentially. It's not the same because so much of the current debt fueled spending is on an asset that has very short shelf life. I think AI will be huge, I don't doubt the endgame once it matures. But the bubble now, spending huge amounts on these data centers using debt without a path to profitability (and inordinate spending on these chips) is dangerous. You can think AI will be huge and see how dangerous the current manifestation of the bubble is. A lot of people will get hurt very very badly. This is going to maim the economy in a generational way.
And a lot of the gains from the Dotcom boom are being paid back in negative value for the average person at this point. We have automated systems that waste our time when we need support, product features that should have a one-time-cost being turned into subscriptions, a complete usurping of the ability to distribute software or build compatible replacements, etc..
The Dotcom boom was probably good for everyone in some way, but it was much, much better for the extremely wealthy people that have gained control of everything.
If you're ever been to a third world country then you'd see how this is completely untrue. The dotcom boom has revolutionized the way of life for people in countries like India.
Even for the average person in America, the ability to do so many activities online that would have taken hours otherwise (eg. shopping, research, DMV/government activities, etc). The fact that we see negative consequences of this like social network polarization or brainrot doesn't negate the positives that have been brought about.
I think you’re putting too much weight on cost (time, money), and not enough weight on “quality of life”, in your analysis.
For sure, we can shop faster, and (attempt) research and admin faster. But…
Shopping: used to be fun. You’d go with friends or family, discuss the goods together, gossip, bump into people you knew, stop for a sandwich, maybe mix shopping and a cinema or dinner trip. All the while, you’d be aware of other peoples’ personal space, see their family dynamics. Queuing for event tickets brought you shoulder to shoulder with the crowd before the event began… Today, we do all this at home; strangers (and communities) are separated from us by glass, cables and satalites, rather than by air and shouting distance. I argue that this time saving is reducing our ability to socialise.
Research: this is definitely accelerated, and probably mostly for the better. But… some kinds of research were mingled with the “shopping” socialisation described above.
Admin: the happy path is now faster and functioning bureaucracy is smoother in the digital realm. But, it’s the edge cases which are now more painful. Elderly people struggle with digital tech and prefer face to face. Everyone is more open to more subtle and challenging threats (identity theft, fraud); we all have to learn complex and layered mitigation strategies. Also: digital systems are very fragile: they leak private data, they’re open to wider attack surfaces, they need more training and are harder to intuit without that training; they’re ripe for capture by monopolists (Google, Palantir).
The time and cost savings of all these are not felt by the users, or even the admins of these systems. The savings are felt only by the owners of the systems.
Technologgy has saved billions of person-hours individual costs, in travel, in physical work. Yet, wemre working longer, using fewer ranges of motions, are less fit, less able to tolerste others’ differences and the wealth gap is widening.
It seems the crux is that we needed X people to produce goods, and we had Y demand.
Now we need X*0.75 people to do meet Y demand.
However, those savings are partially piped to consumers, and partially piped to owners.
There is only so much marginal propensity to spend that rich people have, so that additional wealth is not resulting in an increase in demand, at least commensurate enough to absorb the 25% who are unemployed or underemployed.
Ideally that money would be getting ploughed back into making new firms, or creating new work, but the work being created requires people with PHDs, and a few specific skills, which means that entire fields of people are not in the work force.
However all that money has to go somewhere, and so asset classes are rising in value, because there is no where else for it to go.
It's actually, "they end up" and the 33% gains you're talking about aren't realized en masse until all the coal miners have black lung. It's really quite the, "dealy" as Homer Simpson would say. See, "Charles Dickens" or, "William Blake" for more. #grease
> partially piped to consumers, and partially piped to owners.
Or, the returns on capital exceed the rate of economic growth (r > g), if you like Piketty's Capital in the Twenty First Century.
One of the central points is about how productivity and growth gains increasingly accrue to capital rather than labor, leading to capital accumulation and asset inflation.
Yep, that’s the source of the point. The effort is in finding a way to make it easy to convey. Communication of an idea is almost as critical as its verification now.
You're in luck! A couple years ago he released an "abridged version" of sorts. A Brief History of Inequality is the name. Much more accessible than the 700 pages of Capital in the 21st Century.
With telecom, we benefited from skipping generations. I got into a telecom management program because in 2001-ish, I was passed by on a village street by a farmer bicycling while talking on his cellphone. Mind you my family could not afford cellphone call rates at the time.
In fact, the technology was introduced out here assuming corporate / elite users. The market reality became such that telcos were forced kicking and screaming to open up networks to everybody. The Telecom Regulatory Authority of India (back then) mandated rural <> urban parity of sorts. This eventually forced telcos to share infrastructure costs (share towers etc.) The total call and data volumes are eye-watering, but low-yield (low ARPU). I could go on and on but it's just batshit crazy.
Now UPI has layered on top of that---once again, benefiting from Reserve Bank of India's mandate for zero-fee transactions, and participating via a formal data interchange protocol and format.
Speaking from India, having lived here all my life, and occasionally travelled abroad (USAmerica, S.E. Asia).
We, as a society and democracy, are also feeling the harsh, harsh hand of "Code is Law", and increasingly centralised control of communication utilities (which the telecoms are). The left hand of darkness comes with a lot of darkness, sadly.
Which brings me to the moniker of "third world".
This place is insane, my friend --- first, second, third, and fourth worlds all smashing into each others' faces all the time. In so many ways, we are more first world here than many western countries. I first visited USAmerica in 2015, and I could almost smell an empire in decline. Walking across twitter headquarters in downtown SF of all the places, avoiding needles and syringes strewn on the sidewalk, and avoiding the completely smashed guy just barely standing there, right there in the middle of it all.
That kind of extreme poverty juxtaposed to extreme wealth, and all of the social ills that come along with it, have always been a fixture of the American experience. I don’t think it’s a good barometer or whether the USA is in decline when there has long been pockets of urban decay, massive inequality, drug use etc. Jump back to any point in American history and you’ll find something similar if not much, much worse. Even in SF of all places, back in the wild west era gold rush or in the 1970s… America has always held that contradiction.
Yeah, I sort of recounted a stark memory. That juxtaposition was a bit too much.
However, it wasn't just that, and the feeling has only solidified in three further visits. It isn't rational, very much a nose thing, coming from an ordinary software programmer (definitely not an economist, sociologist, think tank).
AI itself is a manifestation of that too, a huge time waster for a lot of people. Getting randomly generated wrong but sounding right information is very frustrating. Start asking AI questions you already know the answer too and the issues can become very obvious.
> The Dotcom boom was probably good for everyone in some way, but it was much, much better for the extremely wealthy people that have gained control of everything.
You are describing platform capture. Be it Google Search, YouTube, TikTok, Meta, X, App Store, Play Store, Amazon, Uber - they have all made themselves intermediaries between public and services, extracting a huge fee. I see it like rent going up in a region until it reaches maximum bearable level, making it almost not worth it to live and work there. They extract value both directions, up and down, like ISPs without net-neutrality.
But AI has a different dynamic, it is not easy to centrally control ranking, filtering and UI with AI agents. You can download a LLM, can't download a Google or Meta. Now it is AI agents that got the "ear" of the user base.
It's not like before it was good - we had a generation of people writing slop to grab attention on web and social networks, from the lowest porn site to CNN. We all got prompted by the Algorithm. Now that Algorithms is replaced by many AI agents that serve users more directly than before.
>You can download a LLM, can't download a Google or Meta.
You can download a model. That doesn't necessarily mean you can download the best model and all the ancillary systems attached to it by whatever service. Just like you can download a web index but you probably cannot download google's index and certainly can't download their system of crawlers for keeping it up to date.
That's true for the GPUs themselves, but the data centers with their electricity infrastructure and cooling and suchlike won't become obsolete nearly as quickly.
How much more of centralized data center capacity we actually need outside AI? And how much more we would need if we used slightly more time on doing things more efficiently?
this is a good point, and it would be interesting to see the relative value of this building and housing 'plumbing' overhead Vs the chips themselves.
I guess another example of the same thing is power generation capacity, although this comes online so much more slowly I'm not sure the dynamics would work in the same way.
The data centers built in 1998 don't have nearly enough power or cooling capacity to run today's infrastructure. I'd be surprised if very many of them are even still in use. Cheaper to build new than upgrade.
How come? I'd expect that efficiency gains would lower power and thus cooling demands - are we packing more servers into the same space now or losing those gains elsewhere?
This is true. It’s probably 2-3 times as long as a GPU chip. But it’s still probably half or a quarter of the depreciation timeline of a carrier fiber line.
Even if the building itself is condemnable, what it took to build it out is still valuable.
To give a different example, right now, some of the most prized sites for renewable energy are former coal plant sites, because they already have big fat transmission lines ready to go. Yesterday's industrial parks are now today's gentrifying urban districts, and so on.
Companies want GW data centers, which are a new thing that will last decades, even if GPUs are consumable and have high failure rates. Also, depending on how far it takes us, it could upgrade the electric grid, make electricity cheaper.
And there will also be software infrastructure which could be durable. There will be improvements to software tooling and the ecosystem. We will have enormous pre-trained foundation models. These model weight artifacts could be copied for free, distilled, or fine tuned for a fraction of the cost.
Eh not really. Maybe retro cloud gaming services. But games haven't stopped getting more demanding every year. Not only are the AI GPUs focused on achieving clusters with great compute performance per watt and dollar rather than making singular GPUs with great raster performance; even the GPUs which are powerful enough for current games won't be powerful enough for games in 5 years.
Not to mean that we're still nowhere near close to solving the broadband coverage problem, especially in less developed countries like the US and most of the third world. If anything, it seems like we're moving towards satellite internet and cellular for areas outside of the urban centers, and those are terrible for latency-sensitive applications like game streaming.
> But games haven't stopped getting more demanding every year.
This is not particularly true.
Even top of the line AAA games make sure they can be played on the current generation consoles which have been around for the last N years. Right now N=5.
Sure you’ll get much better graphics with a high end PC, but those looking for cloud gaming would likely be satisfied with PS5 level graphics which can be pretty good.
If you look at year over year chip improvements in 2025 vs 1998, it's clear that modern hardware just has a longer shelf life than it used to. The difficulties in getting more performance for the same power expenditure are just very different than back in the day.
There's still depreciation, but it's not the same. Also look at other forms of hardware, like RAM, and the bonus electrical capacity being built.
Honestly I think the most surprising thing about this latest investment boom has been how little debt there is. VC spending and big tech's deep pockets keep banks from being too tangled in all of this, so the fallout will be much more gentle imo.
FLOP/s/$ is still increasing exponentially, even if the specific components don't match Moore's original phrasing.
Markets for electronics have momentum, and estimating that momentum is how chip producers plan for investment in manufacturing capacity, and how chip consumers plan for deprecation.
They kind of aren't. If you actually look at "how many dollars am I spending per month on electricity", there's a good chance it's not worth upgrading even if your computer is 10 years old.
Of course this does make some moderate assumptions that it was a solid build in the first place, not a flimsy laptop, not artificially made obsolete/slow, etc. Even then, "install an SSD" and "install more RAM" is most of everything.
Of course, if you are a developer you should avoid doing these things so you won't get encouraged to write crappy programs.
About 40% of AI infrastructure spending is the physical datacenter itself and the associated energy production. 60% is the chips.
That 40% has a very long shelf life.
Unfortunately, the energy component is almost entirely fossil fuels, so the global warming impact is pretty significant.
At this point, geoengineering is the only thing that can earn us a bit of time to figure...idk, something out, and we can only hope the oceans don't acidify too much in the meantime.
Interesting. Do you have any sources for this 60/40 split?
And while I agree that the infrastructure has a long shelf life, it seems to me like an AI bubble burst would greatly depreciate the value of this infrastructure as the demand for it plummets, no?
They're only replacing GPUs because investors will give "free" money to do so. Once the bubble pops people will realize that GPUs actually last a while.
The wealth the Dotcom boom left behind wasn't in dial up modems or internet over the telephone, it was in the huge amounts of high speed fiber optic networks that were laid down. I think a lot of that infrastructure is still in use today, fiber optic cables can last 30 years or more.
In the late 90s to 2001? Many people were still using modems at that time. Cable or DSL wasn't even an option for a considerable percentage of the population.
Low Global Penetration: Only 361 million people had internet access worldwide in 2000, a small fraction of the global population.
Specific Country Examples
United States: The US had a significant portion of the world's internet users, making up 31.1% of all global users in 2000. Its penetration rate was 43.1%.
Not still using, flat out modemless. Lots of guys got their hand on a mouse for the first time only after Windows XP launched. Which was after the collapse.
Personally I think people should stop trying to reason from the past.
As tempting as it is, it leads to false outcomes because you are not thinking about how this particular situation is going to impact society and the economy.
Its much harder to reason this way, but isnt that the point? personally I dont want to hear or read analogies based on the past - I want to see and read stuff that comes from original thinking.
Doesn't that line of reasoning leave you in danger of being largely ignorant? There's a wonderful quote from Twain "History doesn't repeat itself but it often rhymes" there are two critical things I'd highlight in that quote - first off the contrast between repetition and rhyming is drawing attention to the fact that things are never exactly the same - there's just a gist of similarities - the second is that it often but doesn't always rhyme - this sure looks like a bubble but it might not be and it might be something entirely new. _That all said_ it's important to learn from history because there are clear echoes of history in events because we, people in general, don't change that fundamentally.
IME the number of times where people have said "this time it's different" and been wrong is a lot higher than the number of times they've said "this time is the same as the last" and been wrong. In fact, it is the increasing prevalence of the idea that "this time it's different" that makes me batten down the hatches and invest somewhere with more stability.
This won’t even come close to maiming the economy, that’s one of the more extreme takes I’ve heard.
AI is already making us wildly more productive. I vibe coded 5 deep ML libraries over the last month or so. This would have taken me maybe years before when I was manually coding as an MLE.
We have clearly hit the stage of exponential improvement, and to not invest basically everything we have in it would be crazy. Anyone who doesn’t see that is missing the bigger picture.
Many AI startups around LLMs are going to crash and burn.
This is because many people have mistaken LLMs for AI, when they’re just a small subset of the technology - and this has driven myopic focus in a lot of development, and has lead to naive investors placing bets on golden dog turds.
I disagree on AI as a whole, however - as unlike previous technologies this one can self-ratchet and bootstrap. ML designed chips, ML designed models, and around you go until god pops out the exit chute.
The leap of faith necessary in LLMs to achieve the same feat is so large its very difficult to imagine it happening. Particularly due to the well known constraints on what the technology is capable of.
The whole investment thesis of LLMs is that it will be able to a) be intelligent b) produce new knowledge. If those two things that dont happen, what has been delivered is not commensurate to the risk in regards to the money invested.
Given they're referencing Icarus, they seem to agree with you.
Past bubbles leaving behind something of value is indeed no guarantee the current bubble will do so. For as many times as people post "but dotcom produced Amazon" to HN, people had posted that exact argument about the Blockchain, the NFT, or the "Metaverse" bubbles.
> commentators going on about the wax melting from their parents root cellar while Icarus was soaring.
Icarus drowned in the sea.
Even if you want to put the world into only two lumps of cellar dwellers and Icaruses it is still a group of living people on one side and a floating/semi-submerged pile of dead bodies that are literally only remembered for how stupid their deaths were on the other.
Cisco, Level3 and WorldCom all saw astronomical valuation spikes during the dotcom bubble and all three saw their stock prices and actual business prospects collapse in the aftermath of it.
Perhaps the most famous implosion of all was AOL who merged (sort of) with TimeWarner gaining the lion's share of control through market cap balancing. AOL fell so destructively that it nearly wiped out all the value of the actual hard assets that TW controlled pre-merger.
I would add more metrics to think about. For example, very few people used Internet in the dotcom era while now the AI use is distributed into all the population using the Internet that will probably not growth too much. In this case, if Internet population is the driver, and it will not growth significantly we are redistributing the attention. Assuming "all" society will be more productive we will all be in the same train at the relatively same speed.
First were the models. Then the APIs. Then the cost efficiencies. Right now the tooling and automated workflows. Next will be a frantic effort to "AI-Everything". A lot of things won't make the cut, but absolutely many tasks, whole jobs, and perhaps entire subsets of industries will flip over.
For example you might say no AI can write a completely tested, secure, fully functional mobile app with one prompt (yet). But look at the advancements in Cline, Claude code, MCPs, code execution environments, and other tooling in just the last 6 months.
The whole monkeys typewriters shakespeare thing starts to become viable.
Not even remotely. In LLM land, the progress seems slow the past few years, but a lot has happened under the hood.
Elsewhere in AI however progress has been enormous, and many projects are only now reaching the point where they are starting to have valuable outputs. Take video gen for instance - it simply did not exist outside of research labs a few years ago, and now it’s getting to the point where it’s actually useful - and that’s just a very visible example, never mind the models being applied to everything from plasma physics to kidney disease.
> [At dotcom time] There was a bubble, many non-viable companies got funded and died, and nevertheless the internet did eventually change everything.
It did, but not for the better. Quality of life and standard of living both declined while income inequality skyrocketed and that period of time is now known as The Great Divergence.
> He's (unsurprisingly) making an analogy to the dotcom bubble, which seems to me correct.
He's got no downside if he's wrong or doesn't deliver, he's promising an analogy to selling you a brand new bridge in exchange for taking half of your money... and you're ecstatic about it.
Thank you for acknowledging this. The internet was created around a lot of lofty idealism and none of that has been realized other than opening up the world's information to a great many. It made society and the global economy worse (occidental west; Chinese middle class might disagree) and has paralleled the destabilization of geopolitics. I am not luddite but until we can, "get our moral shit together" new technologies aren't but fuel on the proverbial fire.
Glad to be in agreement. The higher message here is that technology is no substitute for politics, cue crypto-hype which produced little more than crime and money-laundering. Without proper policies, corruption invades every strata of society.
Of course they will, the ultra wealthy are too big to fail. In a bubble like this, they just invest in pretty much everything and take the losses on the 99% of failures to get the x1000 multiples on the 1% of successes. While the rest of us take the hit.
I'm paying for 3 different AI services and our company and most of my team is also paying money for various AI stuff. Sounds like a real industry to me. There's just going to be VC losers as always, where usually "losing" is getting bought by a bigger company or aquihires instead of 100xing or going public.
My team is doing the same, and yet all of us still aren't sure that we're actually more productive overall.
If anything it seems to me like we've just swapped coding with what is effectively a lot more code review (of whatever the LLM spits out), at the cost of also losing that long term understanding of a block of code that actually comes from writing it yourself (let's not pretend that a reviewer has the same depth of understanding of a piece of code as an author).
For almost 20 year, Amazon has been the poster child of "A company can be unprofitable for years and still turn out a winner", but of course - not all companies can pivot from being a regular e-commerce company to cloud infrastructure/hosting, and become a money machine.
So the question, at least to me, is how these AI companies will find a product or service that makes them profitable. Other than becoming actual monopolies in their current domains.
Uber didn't invent anything, they drove taxis out of business then jacked up the prices, squeezed the workers, and now everybody is riding around in regular people's crappy cars for more than a cab cost. And now I need a phone and to maintain my relationship with these two crappy companies rather than to wave at the street (which is what I used to do to get a ride.)
That was literally what everybody said would happen.
They didn't. They innovated, practically implemented ideas that resulted in the introduction of new goods and services [1]. This is a meaningful difference.
Uber didn't invent anything. But they did pull ridesharing out of a hat.
I think Uber invented (or at least made widely available) taxi-by-app. Having scores of cab companies, accessed by telephone call, was supremely user-hostile.
If the cab companies had gotten together on an app, they might have shortcut Uber and all of its many dubious practices. They finally are starting to but it's much too late.
Taxi-by-app existed pre-Uber, the innovation was making the taxi actual show up. Austin had the apps, and I would order one, and the taxis would get distracted on the way to my house and pick up other fares, so I couldn't go where I wanted. They had every chance to not be outcompeted by Uber, but they couldn't stop being taxis. And, here we are.
> the innovation was making the taxi actual show up
Uber regularly doesn’t show up, just playing with “4… 3… 6… minutes left”. I always have to wait half an hour at a certain location, with a message “Just book a few minutes before your trip.”
I’ve had a friend miss his flight because of Uber not showing up!
I think you're definitely in the minority. For most of the world, Uber/Grab/Bolt have made transportation cheaper, safer, more convenient, and more comfortable.
Uber definitely screwed the workers and probably existing taxi companies, but for the users it was a huge W, at least in many parts of the world. Taxi companies are notoriously scammy and it seems to be a very universal experience.
It completely changed an industry. Just because you don't like the current version doesn't mean it wasn't a major innovation. Uber was just the main player in scaling and marketing a new model across the entire globe, which was a huge and costly endeavor.
LLMs have already changed how software can be written and a thousands of other business/consumer usecases, these companies are just battling it out and finding the most profitable niches. It will be a major business for a long time and the technology will mature and plateau pretty quickly. If R&D doesn't scale economically, it will just slow down and existing models will be heavily optimized to be cheaper to run.
The dot com boom resulted in very few real industries and comparing the two is not very useful.
From my experience, this is not the case in many european cities. In those places the main benefit seems to be not having to interact with the cab driver.
You don't talk to your drivers? I've had a lot of genuinely good conversations in my rides. I always at least feel it out and see how much the driver wants to talk but it feels wrong to not say anything
Uber sold something like $50 billion in equity and debt before it went public, and although they're profitable now, to me it doesn't seem like they have answer to Waymo coming up fast in the rear-view mirror. I think Uber is still a scam, just one where the earlier investors fleeced the later ones who are never going to see the returns they paid for.
Seems like a measured approach- my read is him saying it’s probably a bubble in that bad ideas are being funded too, but there are a lot of really good ideas doing well.
Also nit: Typo right in the digest I assume, assuming “suring” is “during”, does cnbc proofread their content?
Faculty at the college I work for are kicking and screaming about AI and students using AI. They don't want to use new tools so they're just trying to outright ban students from using them.
One smug English faculty said, "well it's not that hard. You just look for dashes in their writing."
I responded with, "you know you can just tell it not to use those, right?"
The writing is a mandatory part of the learning process. Outsourcing it to tools is skipping and cheating. Nothing new here. It was the same when the tool was your buddy or upwork before LLMs.
Banning advanced graph calculators on undergrad math exams is not because "they don't want to use new tools", either.
Sure but there's also a continuum of practice between banning outright and letting the students use llm's to just write for them.
Use it as a peer review. Use it during brainstorming. Use it to clarify ambiguous thoughts. Use it to challenge your arguments and poke holes in your assumptions.
The sad difference that makes a difference is that banning graphing calculators from proctored exams is enforceable in practice.
Appealing to honor is a partial solution at best. Cheating is a problem at West Point, let alone the majority of places with a less disciplined culture. It's sad, but true. The fact that you and I would never cheat on exams simply does not generalize.
edit: good on West Point for actually following up on the cheating. I've witnessed another institution sweeping it under the rug even when properly documented and passed up two or three levels of reporting. As an academic director and thus manager of professors this was infuriating and demoralizing for all concerned.
I dont see anything reason at all to expect West Point to have less cheating then anywhere else. Army people dont commit crimes less then civilians either.
A market for lemons means there is an information asymmetry. Sellers know what they have and try to offload their lemons on clueless buyers. I don't think that's the case here.
It is indeed hard to tell how many of the people selling this stuff are True Believers. It's also a bit scary, given how incredibly implausible some of these stuff they're saying is.
All the smartest people I know in finance are preparing for AI to be a huge bust that wipes out startups. To them, everyone in tech is just a pawn in their money moving finance games. They view Silicon Valley at the moment salivating on what there plays are to make money off the coming hype cycle implosion. The best finance folks make the most money when the tide goes out… and they’re making moves now to be ready.
Especially startups in AI are at risk, because their specific niche projects can easily be outcompeted when BigTech comes with more generalized AI models.
Broader impact, but while the big players will take a hit the new wave of startups stands to take the brunt of the impact. VCs and startups will suffer the most.
At the end of the day though it’s how the system is designed. It’s the needed forrest fire that wipes out overgrowth and destroys all but the strongest trees.
My experience has gone the other way than OOP: Anecdotally, I have had VCs ask me to review AI companies to tell them what they do so they can invest. The VC said VCs don't really understand what they're investing in and just want to get in on anything AI due to FOMO.
The company I reviewed didn't seem like a great investment, but I don't even think that matters right now.
To be clear when I said “finance folks” I wasn’t really referring to VCs. I’m talking more family office types that manage big pools of money that you don’t know about. The super wealthy class that has literally has more money than the King but would be horrified if you knew their name. Old money types. They’re well aware of the “dumb VC” vibe that just throws money after hype. The finance folks I’m talking about are the type that eat failed VCs for lunch.
In my experience they invariably conflate LLMs with AI and can’t/won’t have the difference explained.
This is the blind spot that will cause many to lose their shirts, and is also why people are wrong about AI being a bubble. LLMs are a bubble within an overall healthy growth market.
"During bubbles, every experiment or idea gets funded, the good ideas and the bad ideas. And investors have a hard time in the middle of this excitement, distinguishing between the good ideas and the bad ideas. ... But that doesn't mean anything that is happening isn't real."
Remind me again why we need investors to fund bad ideas? The whole premise of western capitalism is that investors can better align with the needs of the society and the current technological reality.
If the investors aren't the gurus we make them to be, we might as well do with a planning committee. We could actually end up with more diversified research.
"Under socialism, a lot of experimental ideas get funded, the good ideas and the bad ideas. And the planning committee have a hard time in the middle of this excitement, distinguishing between the good ideas and the bad ideas. ... But that doesn't mean anything that is happening isn't real."
Committees' investment tends to be not very diversified and often too risk-averse because of how blame placing works. E. g. most of soviet's cloning of chip (and many other products) wasn't due to lack of engineering skill - it's just less risk for the bureaucrats running the show. R&D for an original chip is risky and timing it to the next November the seventh is likely to not work. Cloning is a guaranteed success.
The whole point of capitalism is that one is entitled to the consequences of their own stupidity or the lack thereof. The investors are more willing to take the risks because their losses are bounded - they are risking only as much as they are willing, rather than their status in an organization. Of course once all investors ends up investing into the same bubble there is no real advantage over a committee.
> Remind me again why we need investors to fund bad ideas?
Early stage investors generally fund a portfolio of multiple ideas, where each idea faces great uncertainty - some investments will do tremendously well, some won't. Invstors don't need every investment to do well due to the assymmetry of outcomes (a bad investment can at worst go down 100%, a good investment can go up 10,000%, paying off many bad investments).
> The whole premise of western capitalism is that investors can better align with the needs of the society and the current technological reality.
This is not the premise of capitalism, it's the justification for it - it's generally believed that capitalism leads to better outcomes over time than communism, but that doesn't mean capitalism has 0 wasteage or results in 0 bad decisions.
There is a very important difference: real investors risk their own money, the money they saved over their entire life making decisions.
Under socialism bureaucrats risk someone else's money.
We are not in a pure capitalistic society, we also have States, central Banks with central planning expending over half the money in Europe and USA and more than half in Asia.
As a European myself that see the public money being wasted by incompetent people and filling the pockets of politicians, specially marxist ones. For example, the money Spain received after COVID filled so many socialist pockets and has not given information back to Europe as of how it was spent(it was spent on their own companies of friend and family).
Even then, the people the money came from voluntarily chose those institutions. If you don't like risky investments, there are lower risk institutions or products you can put your money in. It's still ultimately the will of the individual what they do with their money, and the consequences of bad choices are still mostly contained to the individuals who make them. But when it's done with tax money, everyone's dragged into it and has no personal choice in the matter. Even worse, when it's tax money without democracy, even if the majority of people don't like how it's used, they even collectively have no choice in the matter.
No they don't want that, because it could lead to an uprising against them. They want us provided with the essentials in exchange for being dutiful workers, so we have something to lose.
Everyone should live in pods stacked together, eat insects, not drive our own automobiles around or fly places, we should be able to get our entertainment and everything to keep ourselves happy from their subscription entertainment services. Basically we are to consume as little as possible to barely keep ourselves alive and sane while they sail themselves around to pat one another on the backs at their climate and economic conferences on their billion dollar luxury yachts.
Actually no that would be stupid they don't have the time or patience to sail their yachts around. They have crew for that. They will fly in one of their handful of private jets and have the yacht meet them there.
People do this to themselves and willingly, no spooky evil capitalists behind the curtains are necessary.
People love money and what they can bring on the table, people often hate each other ie within families stiffed by peer pressure and expectations of mentalities formed in another very different era, people love discovering new countries and cultures. And so on and on.
Ie me - I love my parents, my childhood was normal, only later to find and compare with others to see how such childhood was... abnormally uncommon. But I very much prefer seeing them few times a year only, even though we love when they help with kids. Some of their opinions are very outdated, their ramblings are often out of touch with reality, they tend sometimes to spoil kids (even after setting boundaries), and overall generational gap is absolutely massive. It is a form of freedom. Make that 10x more in much more strict societies where pressure and expectations from parents on kids are massive and then they wonder why kids stay the heck away from them once adults.
And fuck local communities, for every good-hearted neighbor who just wants to socialize and help out and otherwise stays away from one's life, there is easily 5 or 10 who are the epitome of nimbyism, voyeurism or similar hobbies of people with empty lives, clueless on how world and people actually work but always with very strong opinions on everything and will to push those on everybody else.
> And I mean, you idea of local comunity is all about other people doing free work for you and then tolerating your peculiarities with no reciprocation.
When it seems to you like everyone around you is the problem, you may actually be the problem.
Maybe I phrased wrongly (not a native speaker) but what you say is incorrect. I am not free coasting on parents, in contrary my first years all my earning went into providing them a good home for rest of their lives, while living in tiny rental rooms. You have no idea from sort of poor background I come from, most western kids have no clue. It was a massive improvement of QoL for them that they would never be able to afford themselves and they still appreciate it massively. Since we live 1500km from them they help with kids literally few hours per year, not a burden for anybody involved.
But freedom to chose with whom we spend our time is a thing, no matter how much people like you try to force their righteous values that are the only proper true way (TM) on everybody else. I am old enough and over time met plenty of folks like that, be it religious or other forms, they are at the end the same as your comment.
At that stage, owners will very likely have enough drones and robots at their command to not need to worry about petty things like flesh and blood uprisings.
All the value will be diverted. I don’t know if you noticed, but in the last few years, you’d have come ahead if you gambled on the stock, crypto or commodities market than if you busted your ass.
> Everyone should live in pods stacked together, eat insects, not drive our own automobiles around or fly places, we should be able to get our entertainment and everything to keep ourselves happy from their subscription entertainment services.
Yes of course capitalists love when economy is bad. Sorry, these dystopic visions do not pass even simplest smell test.
It’s less complicated than that. Externalities are when an individual profits but others pay the price. Think of climate change. And when a small number are so rich they control the government, so there’s nothing to stop them. It’s narrow incentives driving the whole thing.
They love it when the richest people do well. They dont care about how anyone else lives. The poorer other people are better they feel about winning.
Those you call "capitalists" love monopolies as long as they are theirs. They love captured market. They dont care about competition unless it is someone not them competing to provide for them on lower price.
As of now, billionaires dont want or need strong economy as a "middle class and lower class doing good". They want the "our wealth goes up, we are getting tax breaks, if lower class pays for it cool" kind of economy.
For sure, but most bridges aren't in scenic places and robocops will still be limited in numbers, so no worries, just ask your LLM assistance in case of doubt under which bridge you won't get evicted from. Altough, that would probably be illegal advice, but they can try to help you with therapy should you end up in such a situation. Not the top model of course, but hey, it is a benefit.
Based on extensive academic research on trickle-down economics, in particular looking into the evolution of real wages of different sectors of population, since 1980s.
See the work of recent Nobel prize laureates in economics. Many argue for redistribution and investment back to the society.
But the past few revolutions benefitted everyone and we are better off. Look at industrial revolution, digital revolution. Why do you think it is different this time? If trickle down economics don't work, why is world poverty at all time low and consumption at all time high?
I really don't see how one can separate the industrial revolution from colonialism, considering we have chiefs of government in colonial countries on the record saying that colonies are a necessary outlet for industrial goods [1].
Once you've established that link, it's hard to explain that "everyone" benefitted from the industrial revolution.
Even disregarding that, the working conditions created by industrialization allowed for situations that can hardly be described as "beneficial" [2][3][4].
What percent of the population in places which experienced the industrial revolution would be better off if they time-travelled back 200 years? 1%? 0.2%?
> in places which experienced the industrial revolution
People experienced the industrial revolution everywhere.
I suspect, when you think "places which experienced the industrial revolution", you think about a small subset of areas where some development happened as a result of that, likely the areas where industrialists lived.
But you would also have to consider other places' experience of industrialization. For instance, Congo under EIC colonial rule did experience industrialization - it was the place where industrial amounts of rubber were harvested to allow for plants elsewhere to produce joints, pipes, motor belts, etc. It's not really hard to believe that, had Congo not experienced that, its citizen would almost certainly have been better off now.
Yeah it’s a complicated picture and of course nobody knows, but it would be helpful to split “benefits” into things like;
- net benefits to the average person (considering drawbacks)
- overall relative benefits compared to income groups
- benefits in certain areas of society and topics
I think there’ll be some “benefits for all” in terms of things like medical advances and health technology. There will also be broader benefits to all in general areas but as a parent poster said it’ll benefit equity holders most and there might be some bad tradeoffs (like we’ll have access to much better information and entertainment but it may also affect the overall employment rate). It’s a very nuanced picture and it’s probably disingenuous of some tech leaders to say “we’ll all benefit) but some do believe that will be the future.
What you mean is those with some form of ownership of the technology. If development eventually results in full automation, with the expense of production reduced to zero, money will be irrelevant.
Energy, raw materials, and logistics still remain. I don't think we'll ever get to a place where there isn't some input to a production process that is not infinite and free.
Theoretically possible? Maybe (but still an extremely slim chance).
Practically possible? No. People (and countries) own land. Raw materials for robots comes from land. Energy for robots consumes land. Farming food requires massive inputs beyond just the land and energy (but also needs those).
I don’t imagine we’ll get to a world where my great-great-great^20-grandkids can hold out their hand and have a plate of steak and potatoes (or the then-equivalent) placed into it for free, anytime they want.
The expense of production and on-demand delivery of just a simple plate of steak and baked potato will not ever get to zero. If we can’t even get that simple of thing for free, I don’t believe in a world without the notion of money.
Expand that to even better dining, vacation, and leisure/recreational activities and I think the argument becomes even more solid that some form of rationing/limiting will be in effect and there will be a unit/notation of ration and trade that will be indistinguishable from money.
Believe me, ruling them out is the last thing I'd do. I fully expect them in the next decade or two.
A practically possible path to both: Starship is perfected and mining companies begin operations in space. Vast data centers training spatial ai using virtual simulations perfect it well enough for general robotics to become practicable. Automation is then as follows: robotics manufacturing and maintenance is handled by robots. Mining is performed by robots. General manufacturing performed by robots. Potential manufacturing scales increase by orders of magnitudes. Where are the costs in this scenario that would prevent prices falling to zero? And if prices for all goods and virtually all services* fall to zero, what possible role can money have at that point, other than sitting on a shelf as a memento of a vanished system?
The cost is in transportation (aside from the cost of developing and producing all those automated systems). Where do you expect extra-terrestrial mining to occur and why do you think what's mined there would be used on Earth? The nearest place to mine would be the moon, and it's on the order of 1 million dollars per kg to bring things back. We could potentially drop that, but that's a hell of a base cost just for material transport. What makes you think that's going to be happening soon?
In the next couple of decades? Starship is real, space mining companies are real, NVIDIA Cosmos is real, robotics development is nascent, but real and thrilling. Ordinary market forces will ensure the uptake of robotics.
You're calculating the expense of returning mined resources using past metrics that are superseded altogether in this scenario. For instance miniaturization suddenly won't be necessary for mining companies wishing to send gear to asteroids.
The wealth gap widening is quite independent from AI being involved. A natural progression which was always happening and continues to be happening. Entil some sort of catastrophe reshuffles the cards. Usually a war or revolution. The poor simply rising up or a lazy and corrupt ruling class depriving their country of enough resources and will to defend itself that some outside power can take it.
Thought experiment - Startrek replicators are real.
This basically means almost everything can be built without human involvement. The guy who owns the replicators is the richest.
The wealth gap is so massive you get revolts (because we're educated, not serfs, right?) So then government needs to step in. Either tax->ubi?, socialize it, or make it a state asset?
If you can make many replicators, money stops making much sense. You probably end up with energy (if these devices take a lot of energy to operate) as the new currency.
My gut says that _somehow_ the middle class will get screwed as always, but I struggle to articulate the way that abundant cheap goods lead to that outcome.
Maybe because the very few that control the replicators will be able to cut people they don’t like out of partaking from them? That’d make some sense.
If replicators were replicatable, that control evaporates quickly. Remember how nervous we all were about LLM censorship, then suddenly a $2000 MacBook Pro could run pretty great open source models that seem a few months behind SOTA?
> If you can make many replicators, money stops making much sense.
There are many, many, many, many positional goods. Beachfront properties, original art, historical artifacts, elite clubs, limited edition luxury goods, top restaurants, etc.
The notion that we'd all live happily and contentedly without money if only we had some more iPhones and other goods produced by replicators strikes me as false.
Remember that Keynes predicted about a century ago that 100 years thence (in other words, now) everyone would just work 10 hours a week at most, and the biggest challenge would be to avoid boredom? He predicted productivity growth accurate enough, but assumed that people would have enough with 4x, 5x as much as they had back then while simultaneously working 4x, 5x less. Instead, people opted to work just as much and consume 16x as much.
What does it mean in practice to have energy instead of money as currency?
People would still want to be able to trade with lower friction than lugging batteries around, so don't you just re-invent money on top of it? orrrrrr just keep having the current money around the whole time?
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The general limiting factor with the "one person controls the replicators, only they have income" idea is that they would rapidly lose that income because nobody else would have anything to trade them anymore. (If you toss in the AI/robotic dream scenario, they don't even need humans to manage the raw material.) But then does that turn into famine and mass-die-off, or Star Trek utopia?
> What does it mean in practice to have energy instead of money as currency?
Something like Bitcoin. When the progress in miners efficiency stalls any kWh of energy not used for something else will be used to make some amount of bitcoins. If you have energy you can make btc. If you have btc you can give your btc to someone in exchange for their energy so that they give you their energy, instead of using it to mine bitcoins themselves.
Only if you assume people's major motivation is wanting what they don't have, as opposed to wanting a little more to survive. History shows the opposite.
> If you can make many replicators, money stops making much sense. You probably end up with energy (if these devices take a lot of energy to operate) as the new currency.
If you can make many replicators, you certainly won't be providing them to anyone else. You'd be using them to ensure that money starts funneling into your revenue stream, and use that as a cash cow to pursue other projects.
What are they replicating? Patented things, copyrighted things? Or groceries? Do they want to replicate things? In Star Trek, they travel light, wear uniforms, and have few personal possessions, because they're on a ship, in the navy. That's why everything has to be digital and everybody stuffs their life inside a phonecorder and drinks synthale. When he's back on earth, Picard has a horse. I could be wrong but I don't think he replicated it.
> Remember how nervous we all were about LLM censorship
You're taking the wrong lesson from that observation. Models that people actually use are just as censored now as they ever were. What changed was the the hysterical anti-censorship babies realized that it's not that big of a problem, at least acutely.
> I struggle to articulate the way that abundant cheap goods lead to that outcome.
It has nothing to do with how cheap the goods are
The problem is that at some point people won't be able to afford literally anything because all, and I mean literally all, of the wealth will be hyper concentrated in a super small percentage of the population
Simple hypothesis. Top 5percent of US wealth now belongs to top 50 richest American. Even if you ignore corruption, lobbying and any ill intent you can definitely conclude that this top 50 individuals have better way of getting return from money than rest of the population. Even if if their delta of return is 5% we can assume that withing next 50 years there is a high probability that these guys will own 30-50% of wealth. I have a strong belive AI will acclerate that further.
But all your numbers (except maybe top 5% one) are completely made up. Strong beliefs don't prevent one from being completely wrong. Neville Chamberlain has a strong belief that he had ensured peace; Einstein had a strong belief that quantum theory's "spooky action at a distance" was incorrect. Both were wrong. Fifty years is a long time, and anything could happen. The last fifty years had the fall of Communism, the EU, China going from an impoverished countryside to a superpower, video phones in our pocket, social media upending communication and mental health, renewable energy displacing coal, Trump, etc.
That's the key. The poor are useful to business so long as they are a source of money and power. What happens if the time comes that the poor have nothing the rich want?
The poor will always have the only thing the rich want. Labor. Without labor Trump cannot slather the white house in gold. Without labor Zuck cannot smoke meats. Without labor Musk cannot troll people on X.
The rich do not want anything you have, they want you. Body and soul.
Not in our lifetimes and certainly not in our form of society. Robots will only drive down the price of labor. People will always be able to supply labor at costs below the price of materials for robots.
" People will always be able to supply labor at costs below the price of materials for robots."
Why? What critical materials do robots need that will always be more expansive than raising a human?
Also, from the point of "the rich" - the benefit of a robot is, that it will (stupidly) do as command, unlike a human. They don't have a family they want to take care first.
I mean, eventually like 1 person is going to have more wealth than 60% of the nation combined. At that point, why even bother trying to earn customers or appeal to the lower half when you can instead curry favor with that 1 person.
If you scratch under the hood of UBI, it's a mechanism to keep revolutions at bay. The balance of tax the ultra wealthy vs giving people enough to "live comfortably" is always the job of governance.
> If you scratch under the hood of UBI, it's a mechanism to keep revolutions at bay.
It's also putting money in the hands of the consumers so the rich can compete between themselves at how much each can scoop back up.
Something like feeding animals in the forest to compete with your friends at who can hunt better.
When poor have nothing then you have to shift to taking money of the other rich, but they are clever, so it's easier to take a little bit from the hands of all rich equally, give that money to the poor and reduce the new problem to the old one, how to extract as much as you can from the poor.
The first sentence is definitely. But, UBI is a nerd/socialist fantasy. It would nevet work and will never happen. Everyone with these sci-fi fever dreams of what will happen if AI collapses white collar jobs are coming from people that don’t know how the world or people actually work outside of their daydreams. People aren’t going to just be like “ok, well I guess it’s time for bread and water and Soviet style tenement housing, all this progress in livings was great while it lasted.” And other people are talking about using batteries for money or something. People need to touch grass.
We're nearly-there. The humans then become the capital/resource to be acquired, not money.
That's why every country is somehow chasing that elusive "population growth". It creates more "things" to own, whether that be money by virtue of more people creating more money through economic activity or simply more people to claim as "yours" (for the elites/leaders).
Or use any of the wonders of military technology invented in the last 200 years to take back society. These fuckers have lived in prosperity for so long that they don't even think it is possible. But so many people throughout history thought they were untouchable until the masses decided they had enough of their shit. Kings with professional armies, full plate knights, men with cannons, mens with guns, machine guns, bombs, planes, tanks, helicopters, and yet at the end of the day when enough random people are pissed off enough the mass of people with nothing to lose are the ones who "win" in the end with the powerful dead or hiding.
When unrest happens the military sides with the ones that give better hopes of keeping the stream of money that funds the army flowing.
It sides with the poor only if the powerful (gov) are hopelessly inept at gathering money. If there's a chance that current civilian power can reform and keep collecting the money from the people and funding the army then the army sides with them and help quell the rebellion.
Those who hold kinetic power will never side with poor against the rich.
Economies can work without currencies. It's a little inconvenient, but bartering/trading goods for services was common in the depression when nobody had any cash.
Printing money is lucrative for the printer so any time it might get even a little bit useful and feasible for other parties somebody will start printing.
No I had the speculative ponzi front of mind when making that comment.
Governments love crypto because it lets you seize lots of money from criminals across borders. And it is legal gambling where you can tax the winnings without reimbursing the losers (unless they can offset it but most probably can not)
> Okay, but why would we die on the vine? Wouldn’t we just… make a parallel economy without the AGI? The world works today without AGI.
Because you need things they want. Like why would they spare the electricity to heat your home, when it could go to "better" use powering a few dozen GPUs serving a billionaire? Why would they spare the land for you to grow food, when they could use it to build ziggurats dedicated to their power (or whatever else is their whim)?
The market sends the scarce resources to those with the most money.
What is the fantasy AGI supposed to be that's so great for billionaires to have? A human baby is an <s>A</s>GI, it won't tell you the Ultimate Answer, or even a penultimate one, because it has no way to know.
No, seriously, what? You think an AGI is going to be a willing slave and endowed with special knowledge? Where does either part of that come from?
Ultimately labour goes and works on something else instead. And the availability of free labour makes that possible. New industries and markets develop as a result. But a huge number of people will be left behind. But people will focus on things that were a lower priority before.
I have bad news for you, we've run out of sectors to pretend labor could be funneled towards. Manufacturing and agriculture are highly automated, service industry is full tf up, and nobody can afford more construction.
What about medical, elder care, fitness, leisure. Even service industries that focus on a more human connection. Or jobs focused on nature, the environment etc.
And i don't think this would nbe an easy process or something that could or would be managed. But it is probably already happening.
It is all society as long as they have access, and they do. Even if the big labs get more closed off, open source is right there and won’t die.
AI increases everyone’s knowledge and ultimately productivity. It’s on every person the learn to leverage it. The dynamics don’t need to change, we just move faster and smarter
> AI increases everyone’s knowledge and ultimately productivity. It’s on every person the learn to leverage it. The dynamics don’t need to change, we just move faster and smarter
This is incomplete in key ways: it only increases knowledge if people practice information literacy and validate AI claims, which we know is an unevenly-distributed skill. Similarly, by making it easier to create disinformation and pollute public sources of information, it can make people less knowledgeable at the same time they believe they are more informed. Neither of those problems are new, of course, but they’re moving from artisanal to industrial scale.
Another area where this is begging questions is around resource allocation. The best AI models and integrations cost money and the ability to leverage them requires you to have an opportunity to acquire skills and use them to make a living. The more successfully businesses are able to remove or deprofessionalize jobs, the smaller the pool will be of people who can afford to build skills, compete with those businesses, or contribute to open source software. Twenty years ago, professional translators made a modest white collar income; when AI ate those jobs, the workers didn’t “learn to leverage” AI, they had to find new jobs in different fields and anyone who didn’t have the financial reserves to do that might’ve ended up in a retail job questioning whether it’s even possible to re-enter the professional class. That’s great for people like Bezos until nobody can afford to buy things, but it’s worse for society since it accelerates the process of centralizing money and power.
Open source in particular seems likely to struggle here: with programmers facing financial downturns, fewer people have time to contribute and if AI is being trained on your code, you’re increasingly going to ask whether it’s in your best interests to literally train your replacement.
Is the average person actually better off after the late 90’s internet is probably a harder question than it might seem.
The long tail may be closer to what I want, but the quality is also generally lower. YouTube just doesn’t support a team of talented writers, Amazon is mostly filled with junk, etc.
Social media and gig work is a mixed bag. Junk e-mail etc may not be a big deal, but those kinds of downsides do erode the net benefit.
Are you being objective or just romanticizing the past?
Just to use your example: YouTube is filled with talented writers and storytellers, who would have never been able to share their content in the past. *And* the traditional media complex is richer than ever.
I don’t think average quality matters. Just what you want to consume.
If anything, I’d be more open to the opposite argument. Media is so much richer and more engaging that it actually makes our lives worse. The quality of the drugs is too high!
Media is so much richer and more engaging that it actually makes our lives worse. The quality of the drugs is too high!
I am not sure it's the quality, it's more that it's optimized for dopamine shots. Heroine is highly addictive, but I think that few people would argue it's a quality drug.
Recently there was a TV item that was filmed (in NL) just before the broad adoption of mobile phones (not smartphones). People looked so much more relaxed and more oriented towards others. I am happy that until my 18th or so mobile phones were not really a thing and that smartphones were not a really a thing until I was 25-27. I was an early adopter of smartphones, but I don't think we realized how addictive and destructive social media + smartphones would become.
The early internet was very cool though. Lots of info to be found. A high percentage of users had their own web page. A lot of it was pretty whacky/playful. Addictive timelines etc. had not been invented yet.
Does the answer to "is the average person better off" have a lot to do with "how many TV shows are out there"...
or does it have to do with:
- how often their boss bugs them after hours
- how much their boss uses technology to keep an eye on them, their friends, their political views
- how often random strangers might get mad at them and SWAT them, make false claims to their employers, etc
- how often their neighbors are radicalized into shooting up a school
- how hard they find it to talk to a real person to resolve an issue with a company or government service vs being stuck on hold because of downsizing real support staff relative to population size, or with an ai chatbot?
I was trying to be objective which is why I didn’t try to compare individual shows.
Thus average production quality seems like a useful metric. There’s currently a handful of “traditional media/streaming” shows with absolutely crazy budgets today and if you happen to like them then that’s great. However, if you don’t things quickly fall off a cliff in terms of production quality.
The same is true of YouTube. The quality of 50,000 one man operations is irrelevant if you happen to like MrBeast, but if you don’t like MrBeast budgets drop off fast. A reasonable argument is you and everyone else may prefer a specific YouTube cooking show over Baking with Julia or other 90’s show with a much her budget, but there where several options to chose from.
Thus purely objectively even if 90’s TV had lower maximum budgets the floor being relatively high is worth taking into consideration.
It's worth noting that due to advances in technology, it is possible to deliver the same show for less money and time.
The average "how to cook on a food network" show was, ultimately, one person in the kitchen of a large home cooking for the camera, produced once a week. There are plenty of people delivering that style of cooking show with high production quality today. Obviously it's not the same because some things are less deliverable with smaller or one-person teams (Miss Piggy is not going to visit some Youtube show the way she visited Martha Stewart) but there are people making this content ranging from big shops like NYT Cooking to smaller outfits like Binging with Babish, Glen and Friends Cooking, etc. and there are even outfits like this dedicated to more niche topics like Tasting History or Emmymade.
> it is possible to deliver the same show for less money and time
Do we, though?
I recently learned about the controversial scene "Baby, It's Cold Outside".
Ignoring the content of the scene for a moment, the quality of the choreography stood out to me as something you would never see in a movie today. Certainly not in one take.
show business and things like it are famously pyramidal in shape. there are decades' worth of people who couldn't make it in previous generations in Los Angeles and New York.
i think what is relatively new is the unaffordability crisis making it so doing such pursuits and not being that successful is no longer a way to make a living on its own.
I wish this argument would die. We're asking for a better future among futures, not a better future compared to the past.
It's like buying a car, receiving a bike, and then being told, "A bike is great because you don't have to walk anymore." If you feel like that's unfair and the response misses the point, that's how that lands. I don't know who, when hearing that, feels better. It feels out of touch and dismissive.
Youtube has some marginal value, but I'm not sure "storytellers" bring a materially positive impact (and I reject the "richer" aspect outright). We had libraries in the 90s and they didn't force you to watch ads.
I question this narrative. While social media is certainly having a negative impact, most democratic societies have relatively short life spans historically speaking. There’s also a tendency for economies to falter, for irrationality to increase, for birth rates to drop, and so on. It would seem that the same trends (roughly) occur in every democracy as it starts to fail.
Yes. The meta problem is the trend toward “I dont’t like X, and I don’t like Y, therefore X is causing Y” thinking.
It’s always been the reactionary’s argument: immigrants cause crime, inter-racial marriage causes poverty, etc, etc.
The real collapse we’re seeing is the liberal / progressive adoption of these fallacies. Social media causes fascism (nevermind the absence of social media in previous collapses into fascism), etc.
Many of the people rightfully dismayed by trends are unwittingly contributing to the changes they dislike.
The correct answer to “I think social media leads to fascism” is not “let’s ban social media”. The correct answer is “let’s study the problem and see what science says”. Abandoning that is giving up.
I think in the near term social media can actually have a stabilising effect just because of how much it paralyzes people. It takes emotion and redirects it into something with little real world effect. Whilst most actual power is exercised offline. This sometimes breaks down and the crazy escapes from the internet and reeks havoc. But mostly the geriatrics are left alone to pull the levers of power in relative peace.
Expand the thinking to include impact on developing countries, the poor, minority groups who have few people like themselves in their local area, etc.
I’ll grant that for comparatively wealthy, privileged people who were always going to have an easy time (which frankly include me), the internet has been a mixed bag.
But for the kids growing up in comparatively poor countries, who can now access all of the world’s information, entertainment, and economy.. I think it’s a pretty clear win.
I expect AI will be similar: perhaps not a huge boon to the best off, but a substantial improvement for most people in the world. Even if we can sit back and say “oh, but they also get misinformation and lower quality YouTube content”
Undeniably better off in every single way. Minimum is that the price of long distance phone calls is now zero, let alone video calls. Being able to speak to family and see them nonstop is incredible.
Do people actually visit family in-person at least less often? And to the degree they augment rare family in-person visits with a lot of phone calls and/or video calls.
I can believe a lot of friend get togethers IRL have been replaced with video calls. There's a tradeoff. I have a group of older friends and we still get together in-person but Zoom calls are a nice adder.
I'm in a few organizations where we also find Zoom a nice alternative to people schlepping somewhere for an hour meeting that mostly works as well online--and we still have a few physical get-togethers over the course of the year.
Young people are forced to move to wherever job opportunities are due to how hyper optimized the economy has become, so I would say most people spend way less time with family than 30 years ago
It's complicated and you can look at a lot of studies. People have always moved where opportunities existed--including across oceans pre-aircraft. Yes, when there were company towns, people moved less.
More precisely, Americans are more diagnosed with depression. In the five years prior to COVID it's shown as rising by 3.3 percentage points. Is that surprising? The trend isn't likely to be flat. Also, is this happiness? Also, does a graph starting in 2015 relate to the question about the 90s? Also, do you expect happiness to be driven by having new things, or for people to adjust their expectations and remain constantly unhappy? Isn't disruption the main cause of unhappiness?
I wonder what event started in 2020 that might have caused major social and economic disruption, and could have had that effect. Maybe something that drastically limited peoples social mobility and lead to mass isolation.
Would you rather be a 22 year old starting in life in 2025 or 1995? Unless you pick one of the few countries that underwent a drastic change of regime in that time, the answer’s pretty clear to me.
Given my skillset at age 22? Yeah, I'll take 1995. I was old enough to grow up hearing how great the world was going to be if I learned computer programming just to enter the job force at the start of the dotcom bubble burst. 1995 would have been a major upgrade.
Also, knocking that almost decade off my birthday would assure that I spent most of my adult life with the luxury of thinking that energy didn't have negative externalities that were being forced on later generations.
We had Chomsky-esq "any major world power is kind of fascist if you think about it" instead of literal talk by politicians about putting people in camps if they don't like your diet or country of origin.
TV was pretty bad I guess but music was great and I read more back then.
There was a lot of huffing and puffing about gang violence. I grew up on the street the local gang named themselves after and it only marginally touched my life at all.
Housing was dirt cheap, food was dirt cheap, gas was dirt cheap. There was undeveloped land everywhere around the city I live in and it gave a general sense of potential.
Yes, the US was in a particularly prosperous and exciting period compared to much of the rest of the world in 1995. If you’re, say, Chinese, chances are you find life in 2025 much more appealing
Overall, life is better in 2025 for the vast majority of humans. Life expectancy, child mortality, health (despite the obesity epidemic, which is a result of an abundance that has eliminated hunger and food insecurity from large swathes of the globe), purchasing power, access to technology and entertainment, etc, etc…
That some people in the US are feeling disillusioned because housing has become more unaffordable (partly because of regulations and technological advancements that have improved their quality and safety) and that they don’t have the same incredible economic trajectory as the preceding generations, especially since WWII, doesn’t negate that. A run like that can’t last forever, especially since it to a large extent depends on having a relative advantage over the rest of the world - at some point, they’ll start to catch up
Once upon a time, society was all of us, but Society were the filks that held coming out parties and gossiped about whose J-class yacht was likely to defend the America's cup.
Society with a capital S are the beneficiaries of the bubble.
Bezos didn't define "society", but knowing Devil is what Devil does, we can infer:
1. Amazon files the most petitions for H1-B work visas after Indian IT shops.
2. Amazon opposed minimum wage increase to $15/hr until 2018!
3. Amazon not only fires union organizers, it's claiming National Labor Relations Board is unconstitutional!
The fact that Bezos is saying this is precisely why the commenter is asking this. He clearly stands to benefit massively from the bubble. Statements like this are meant to encourage buy-in from others to maximize his exit. Presumably "rich" refers to those, like Bezos, who already have incredibly disproportionate wealth and power compared to the majority of people in the US. I'm honestly not sure what the thrust of your comment even is.
Counter prediction. AI is going to reduce the (relative) wealth of the tech companies.
AWS and Facebook have extremely low running costs per VPS or Ad sold. That IMO is one of the major reasons tech has received its enormously high valuation.
There is nuance to that, but average investors are dumb and don't care.
Add in a relatively high fixed-cost commodity into the accounting, and intuitively the pitch of "global market domination at ever lower costs" will be a much harder sell. Especially if there is a bubble pop that hurts them.
I don't understand this argument. Speaking as a kid who grew up middle-class as an 80's teen obsessed with (the then still new) computers, a non-rich person has access to more salient power today than ever in history, and largely for no or low cost. There are free AI's available that can diagnose illnesses for people in remote areas, non-Western nations, etc. and which can translate (and/or summarize) anything to anything with high quality. Etc. etc. AI will help anyone with an idea execute on it.
The only thing you have to worry about are not non-rich people, but people without any motivation. The difference of course is that the framing you're using makes it easy to blame "The System", while a motivation-based framing at least leaves people somewhat responsible.
Wealth may get you a seat closer to the table, but everyone is already invited into the room.
The problem is if the system leads to demotivating people more than motivating them on average, which risks a negative feedback loop where people demotivate each other further and so on
You have an incorrect reading of history and economy. Basically none of the wealth and comfort we (regular people) enjoy were "gifted" or "left over" willingly by the owner class. Everything had to be fought for: minimum wage, reasonable weekly hours, safe workplaces, child labor, retirement, healthcare...
Now, ask yourself, what happens when workers lose the only leverage they have against the owner class: their labor? A capitalist economy can only function if workers are able to sell their labor for wages to the owner class, creating a sort of equilibrium between capital and work.
Once AI is able to replace a significant part of workers, 99% of humans on Earth become redundant in the eyes of the owner class, and even a threat to their future prosperity. And they own everything, the police and army included.
That's a very relevant question. And as your question implies, we all know which society the billionaires talk about. But AI is just a technology like any other. It does have the potential to bring great benefits to humanity if developed with that intent. It's the corruptive influence of the billionaire and autocrat greed that turns all technologies against us.
When I say benefits to humanity, I don't mean the AI slop, deepfakes and laziness enabler that we have today. There are niche applications of AI that already show great potential. Like developing new medicines to devising new treatments for dangerous diseases, solving long standing mathematical problems, creating new physics theories. And who knows? Perhaps even create viable solutions for the climate crisis that we are in. They don't receive as much attention as they deserve, because that's not where the profit lies in AI. Solving real problems require us to forgo profits in the short term. That's why we can't leave this completely up to the billionaires. They will just use it to transfer even more wealth from the poor and middle classes to themselves.
I have a phd in mathematics and I assure you I am not happy that AI is going to make doing mathematics a waste of time. Go read Gower's essay on it from the 90s. He is spot on.
What are the actual benefits? Where are all these medicines that humans couldn’t develop on their own? Have we not been able to develop medicine? What theorems are meaningful and impactful that humans can’t prove without AI? I don’t know what a solution to the climate crisis is but what would it even say that humans wouldn’t have realistically thought of?
You're most likely correct in thinking 'we would get there eventually'. But in the case of medicine, would you like to make that case to those who don't have the time to wait for 'eventually' - or who'll spend their lives in misery?
It's a matter of prompt engineering, you have to be a really good engineer to pick the correct words in order to get the cure for cancer from ChatGPT, or the actual crabby patty recipe
Yes, Facebook is a benefit. Among other things, it gave me React which much of the modern web is built on, and React Native, PyTorch, GraphQL, Cassandra, Presto, and RocksDB just to name a few.
The question is, what are billions of people doing on Facebook if it's harmful? I don't know. My daycare sends me updates, my barbershop tells me when they're closing and I used it to sell my fridge.
This hole Facebook irrational hate is ridiculously overblown. It's an app, and compared to things like TikTok that is essentially a Chinese psy-op, it's really a great product.
I think it's incredibly naive and arrogant to tell billions of people who use a product through their own free will "ackchyually its really bad and you should stop".
Almost everyone would give you a response similar to mine. They use it because its easy way to plan events since so many people are on it, or a small business can easily create a website, sell something or just kill some time on the can.
I don’t want to spoil anything for you, but ethanol is actually a very reactive molecule — and in some ways, it acts similarly to opioids like heroin. It, among other things, stimulates endogenous opioid pathways, leading to the release of β-endorphins and activation of mu-opioid receptors. So, alcohol works indirectly, heroin directly – but both enhance opioid signalling. If you’re curious, this study explains it really well:
Food activates it within normal biological limits, alcohol and heroin artificially push the same system far beyond normal range, forcing the brain to compensate by downregulating receptors or reducing endogenous opioid production, so it's totally legit to compare alcohol to heroin
> My daycare sends me updates, my barbershop tells me when they're closing and I used it to sell my fridge.
To consider the other side of this, read "The age of surveillance capitalism" by Shoshana Zuboff (really read it though, not chatgpt the summary :).
All the benefits you mentioned are real. But, at what cost and could we have reaped the same benefits without surrendering all agency to those who can't be held accountable?
What are the costs? Seems like a huge benefit to me considering the alternative would be... I don't know. No updates? Maybe some shitty custom app that would 100% for sure have worse data security and privacy rights than something like Facebook?
Everyone's talking vaguely about the costs but no one actually makes a concrete case, where I made a concrete case of the benefits.
Facebook and many of these other VC companies have worked by building a moat through network effects by burning money to build something free and awesome. Then once you HAVE the network effect then it becomes hard to leave. Your history is on there, people know you through it, your friends and family are there; are you really going to leave? That’s when Facebook starts turning the screws. Ads. Manipulative algorithms. Polarizating recommendation algorithms. Social isolation. Making deals with dictatorships. Censorship of the worst crimes humanity can commit against itself (genocide).
Why? They are making money through all of it. It’s called rent extraction. You OWN something valuable. You no longer have to produce something of value. You can just charge people money for what you own. Rent. It’s various forms of rent. Sucking out money and souls into it. One of countless ways we’re leeched on by these companies and their billionaire owners.
Do the benefits outweigh the harms? Facebook and the VC playbook is boiling a frog and we are the frog.
It’s fast because there already gobs of people on the internet because of all the other products that came before. Facebook didn’t grow as fast because there weren’t as many people on line then. Gmail didn’t grow as fast because there weren’t as many people online then.
Yeah, but net worth is weird because for most people, it just measures age. When you're young, you have nothing in your 401k and you have a brand new mortgage, so you're worth around $0. Negative if you have any student loans.
When you're in your 50s or 60s, the mortgage is repaid, and if nothing blew up, you probably also have a million or two in your 401k, so at that point, it's actually not that hard for a person who had a decent career in the SF Bay Area to be worth $4M+. And many FAANG retirees will probably flirt with $10M+ if they don't spend too much.
Entry-level total comp for SWEs in the SF Bay Area is probably $250k. A senior dev at a public tech company can easily clear $400k. Really senior engineers at FAANG routinely clear $1M.
For senior engineers with some fiscal discipline, it's great, although it's more great to work remotely.
On the more junior end, that $250k goes about as far as $100k in a less expensive region. Keep in mind that the average 1-bedroom rent is $3k+/mo, the average home for a family with kids is $2M, the average PG&E bill for a house is probably $400+, any repairs or remodels will cost you 2x as much as in most other places... and state income taxes are 10% on top of federal.
Most CoL estimates put the cost of living in San Jose at 2x the national average. And that's San Jose.
Do I have this right that there have been no or at least very few pure AI IPO's during this cycle (I can't actually think of a single one)? So it's dissimilar to dotcom in that regard because during that time countless dotcoms went public with sky-high valuations and then failed. A bunch of reputable companies also went or were already public during that time and those saw huge valuation drops so that's more analogous to what could happen in the public market (NVDA, for instance, could pull a Cisco and drop "catastrophically," but survive just fine).
That would cause a lot of pain for those shareholders, but would that be somewhat contained given the public "AI" companies for the most part have strong businesses outside of AI? Or are these market caps at this point so large for some of these AI public companies that anything that happens to them will cause some kind of contagion? And then the follow up is if the private AI companies collapse en masse is that market now also so big that it would cause contagion beyond venture capital and their investors (fully aware that pensions and the such are material investors in VC funds, but they're diversified so even though they'd see those losses maybe the broader market would keep them from taking major hits).
Not giving an opinion here, though my knee jerk is to think we're due for a massive drop, but I've literally been saying that for so long that I'm starting to (stupidly) think this time is different (which typically is when all hell breaks loose of course).
There aren't very many IPOs in general. There were about 8000 publicly traded companies in the US in Jan 2000. Today there are about 3950. A lot of the AI related IPOs have been the infra like CoreWeave and Nebius.
However, it is different from the internet bubble partially for the reason you describe.
There have been a few IPOs, but they perhaps happened earlier in the cycle, or companies are pivoting into AI. I'm thinking companies like Palantir, which was always AI, or Salesforce which is making a big AI pivot.
Most of the funding is not coming from public sectors. There is so much private capital available that it isn't necessary. I believe the bubble is in VC, which some would think is find because it protects public markets from the crash, but I'm not sure that is correct.
When the VC money stops flowing into AI, I think it will send a shockwave through the public markets. The huge valuations of companies like OpenAI, Anthropic, etc will be repriced, which will probably force a re-pricing of public darlings like Palantir, Microsoft, NVIDIA.
If VC funds aren't buying NVIDIA chips and building data centers, everyone will feel the need to re-price.
Historically, the worst busts following the bursting of an asset price bubble, in terms of real economic impact, have been from debt fueled bubbles (Great Depression, Global Financial Crisis). You can read Hyman Minsky and Irving Fisher for a detailed analysis of why, but it mainly comes down to the fact that the financial obligations remain once prices and expectations have reset.
Then you have the busts that follow public equity fueled bubbles (Dotcom crash). Nowhere near as bad as the former, but still a moderate impact on the economy due to the widely dispersed nature of the equity holdings and the resulting wealth effect.
What we have now is more of a narrowly held private equity bubble (acknowledging that there's still an impact through the SP500 given widespread index investing). If OpenAI, Anthropic, Perplexity, and a bunch of AI startups go bust, who loses money and what impact does it have on the rest of the economy?
It may be true that OAI et al are raising money in private markets, but does that matter? Ultimately they are still just raising money. Ultimately returns need to show up. You cannot escape that. If you cannot do that nobody will eventually supply the funds to keep operating.
The big advantage of staying private is controlling the narrative.
Because the comment was specifically pointing out that this doesn't seem like a bubble because there aren't many IPOs or public pure play AI companies.
IPOs aren't what they once were. The burden of being a public company has increased (SOX and related public company costs are $5-10M/year), so companies are far more likely to stay private. That has created a positive feedback cycle as the private funding ecosystem has become increasingly robust, which is why you see so many $100B+ private companies.
Also keep in mind that the biggest companies during that bubble had peak market caps of ~500B and then lost ~90%, so 400-500B in losses each and total internet related losses of a couple trillion. If NVDA lost 90%, it would be down 4 trillion dollars, or twice that total just by itself.
AI company valuations collapsing would have meaningful impacts on the broader market. Big pension/mutual funds are important sources of capital across every sector, and if they're taking big losses on NVDA, GOOG, and a portfolio of privates, it will have a chilling effect on their other activity.
The costs are a weak argument. The more stronger argument for why they arent going public any time soon is that OAI in particular is a corporate governance nightmare, in which the way they transmit information about their firm and financials will have to completely change.
Theres also plenty of money washing around in private markets so no need to go public. Staying private is an advantage.
there is no way they could raise that much money from public markets.
Also, there s no need to invent new tech names anymore. Marketing can add "AI" to the company name, or (as they say), change the wording from "Loading..." to "Thinking.."
I'd love to see those "gigantic benefits". Currently, the only positive thing about LLMs I hear regularly is that it made people more productive. They don't get paid more (of course), they're just more productive.
I'm not arguing it's a bubble. I'm arguing it's not going to be a "gigantic benefit" for society.
> Will also be good for consumers in the long-term: much faster pace of drug discovery and new tech generally.
Medicine and tech that knowledge workers won't be able to pay for without a job. I also don't think "new tech" is necessarily a good thing societally.
The calculus is easy, really: AI makes 100% of my income worth less but only decreases the cost of a fraction of my expenditures. AI is bad for anyone that works for a living. That's pretty much all of society except for the top x%.
It's very hard to find anything other than half saying AI is in a bubble, and we will pop any day now, and the other half declaring AGI by 2029, when a new revolution will begin. If you follow the hard science and not the money, you can see we're somewhere in-between these two takes. AI datacenters requiring new power plants is unsustainable for long-term growth. Meanwhile, we have LLMs accepting bullshit tasks and completing them. This is very hard to ignore.
People in the comments seem to have forgotten about, or never lived through, the dot com bubble. Amazon’s shares fell from $113 to $6 in 2000.
So yes, the internet survived and some companies did well after, but a lot of people were hurt badly.
Gotta say I'm pessimistic about the future of AI. At least until its adopted by public sector, schools and societies. Right now its just enhancing what we already have. More "efficient" meetings with auto-note-taking so we can have more meetings. More productivity so we can make less people do more, increase the workload and make them burn out faster. Better and more sophisticated scammers. More sophisticated propaganda by various legal and illegal actors. Cheaper and more grotesque looking vidz and music. More software slop. Not to mention all the "cool" improvements coming our way in the form of smart rockets, bombs and drones and of course I drool for all the smart improvements in surveillance capitalism 2.0. They call it a revolution but for now its just a catalyst for more of all the things we "love".
I see that my Echos want me to enable the new Alexa. I confess a great deal of trepidation on these. Fairly confident that this is not going to go smoothly.
And again I'm baffled on how they would light such good will and functionality on fire.
Yesterday someone's uncle tried the same thing and now his bank account's drained because the 2% that wasn't working was the 2% that prevented his password store from being posted online.
See how that works? A few nerds think it's great while everyone else gets screwed by it.
This shouldn't be a surprise - capitalism always overshoots. Anything worth investing in will generally receive too much investment in because very few people can tell where the line is.
And that's what causes bubbles but at this point it should be clear that AI will make a substantial impact - at least as great as the internet, likely larger
You made the point for me. That 100bn doubled every 2-3 years. It wasn’t a bubble, but it absolutely looked like one. This will be a bitter lesson too.
My understanding is that the cost of training each next model is very very large, and a half trained model is worthless.
Thus when it is realised that this investment cannot produce the necessary returns, there will simply be no next model. People will continue using the old models, but they will become more and more out of date, and less and less useful, until they are not much more than historical artifacts.
My point is that the threshold for continuing this process (new models) is very big (getting bigger each time?), so the 'pop' will be a step function to zero.
Why do you think the models will become out of date and less useful? Like, compared to what? What external factor makes the models less useful?
If it's just to catch up with newly discovered knowledge or information then that's not the model, they can just train again with an updated dataset and probably not need to train from scratch.
> What external factor makes the models less useful?
Life. A great example can be seen in the AI-generated baseball-related news articles that involve the Athletics organization. AI articles this year have been generating articles that incorrectly state that the Atlanta Braves played in games that were actually played by the Athletics, and the reason is due to the outdated training model. For the last 60 years before 2025, the Athletics played in Oakland, and during that time their acronym was OAK. In 2025, they left Oakland for Sacramento, and changed their acronym to ATH. The problem is that AI models are trained on 60 years of data where 1. team acronyms are always based on the city, rather than the mascot of the team, and 2. acronyms OAK = Athletics, ATL = Atlanta Braves, and ATH = nothing. As a result, an AI model that doesnt have context "OAK == ATH in the 2025 season" will see ATH in the input data, associates ATH with nothing in it's model, and will then erroneously assume ATH is a typo for ATL.
If they stop getting returns in intelligence, they will switch to returns in efficiency and focus on integration, with new models being trained for new data cutoffs if nothing else. Even today there is at least a 5-10 year integration/adoption period if everything halts tomorrow.
There is no reality in which LLMs go away (shy of being replaced).
> If they stop getting returns in intelligence, they will switch to returns in efficiency
I don't think we can assume that people producing what appear to be addictive services are going to do that, especially when they seem to be addicted themselves.
Many argument the current batch of models provide a large capability overhang. That is, we are still learning how to get the most out of these models in various applications
So with every prompt you are expected to wait that long?
I highly doubt general people will be willing to wait, it also doesn't seem entirely viable if you want to do it locally, less bandwidth and no caching akin to what a literal search engine of data can do.
I think most level-headed people can see this is a giant bubble which will eventually burst like the dot-com crash. And AI is technology that's hard to understand to non-technical (and even some technical) investors.
But of course, every company needs to slap AI on their product now just to be seen as a viable product.
Personally, I look forward to seeing the bubble burst and being left with a more rational view of AI and what it can (and can not) do.
OpenAI has a reasonable path to reduce their costs by 10-100x over the next 5 years if they stop improving the models. That would make them an extremely profitable company with their only real risk being “local ai”. However customers have wanted their data in the cloud for years, local inference would likely just mean 0 cost tokens for OpenAI.
The challenge is the rest of the industry funding dead companies with billions of dollars on the off chance they replicate OpenAI’s success.
I don't see how this works though. OpenAI doesn't exist in a vacuum, it has competitors, and the first company to stop improving their model will get obliterated by the others. It seems like they are doomed to keep retraining right up until the VC funding runs out, at which point they go bankrupt.
Some other company, that doesn't have a giant pile of debt will then pick up the pieces and make some money though. Once we dig out of the resulting market crash.
The winner takes all thesis would be that like TSMC, the capex of competing in this field keeps growing until only one vendor can both raise sufficient capital to compete and effectively execute with that capital. OpenAI doesn't need to be the first to stop raising money and go profitable, they need to be the last vendor to go profits first.
OpenAI is trying to launch a hardware product with Jony Ive, an ads company, a AI slop-native version of TikTok and several other "businesses". They look well on their way to turning into a Yahoo! than a Cisco or VMWare.
Yeah they are all over the place and this should be a huge red flag.
Some marginal investors know this but they are okay because the music is still playing - but when they think its time to leave the bubble will pop.
People seem to forget that its not about whether or not its actually a bubble, its really about when will certain people who set these stock prices for valuations, decide its time to exit and take their profit.
The problem is OAI has very firece competition - folks who are willing to absorb losses to put them out of business.
Uber and Amazon are really bad examples. Who was Amazons competition? Nobody. By the time anyone woke up and took them seriously it was too late.
Uber only had to contend with Lyft and a few other less funded firms. Less funded being a really important thing to consider. Not to mention the easy access to immense amounts of funding Uber had.
I too am waiting for the bubble to burst. Particularly because I think it's doing real harm to the industry.
Every company seems to be putting all their eggs in the AI basket. And that is causing basic usability and feature work to be neglected. Nobody cares because they are betting that AI agents will replace all that. But it won't and meanwhile everything else about these products will stagnate.
It's a disasterous strategy and when it comes crashing down and the layoffs start, every CEO will get a pass on leading this failure because they were just doing what everyone else is doing.
The difference now is that this is all (or mostly) idle cash being invested. The massive warchests built up by FAANG over the last decade are finally being deployed meaningfully rather than sitting in bonds or buying back stock. Much different scenario than companies with non-viable business models going IPO on a wish and a dream.
It's a question of how far the contagion goes - the Dotcom bubble trashed the NASDAQ and rumbled the world a bit, but the "big stocks" weren't directly involved or affected much; the subprime mortgage bubble shook the very foundations of the banking world.
Will the contagion be limited to a few companies, or will the S&P crumble under the bubble's collapse?
The part that’s hard to understand is how the sunk costs of hundreds of billions in capex gets repaid by all those people in cafes paying hundreds of dollars per month to use those LLMs.
Not hard to use. I meant hard to understand what the limitations are for non tech users. E.g people who think AGI is just around the corner because we now have stochastic parrots.
People have no idea how much concern there was around whether FB would ever be able to monetize social media. That company went public at $15, and nearly closed below that on IPO day.
AI is more useful than social media. This is not financial advice, but I lean more toward not a bubble.
Every bubble looks obvious in hindsight. The dot-com crash left behind Amazon and Google. The crypto crash left behind Coinbase and a few real revenue generating companies. If this is the AI bubble, then the survivors are going to look very obvious in a decade, we just don’t know which ones yet.
Crypto isn't bullshit well most of it is but the utility is still used by millions of people around the world, specifically USDT and USDC which they proven a good way to move your assets without too much regulations.
So it is regulatory arbitrage. I think many of the critics never contested that crypto is good for doing crime. The critics just also think that either those crimes should continue to be prevented via the financial system or the financial system should be deregulated for all without a crypto backdoor.
A Money Market Fund gives you interest if you are able to access it.
This is kind of a pattern:
1. There is some regulation that is inefficient ( e.g. taxi medallions, KYC, copyright protection ...)
2. New technology comes about which allows startups to claim that they have invented a new area that should be regulated differently
3. Turns out (2) is not true and new technology can easily be mapped to existing regulation but it would look bad for the regulator to take away the punchbowl
4. There is some down-turn (bubble pops) and the regulator takes away the punchbowl OR investors have accumulated so much money/power that they corrupt the government to have new rules for their businesses
Gmail's beta started in 2004, and Google Maps launched in 2005. Google's IPO was in 2004, so Web 2.0 products played no part in its enormous early growth.
> The term "Web 2.0" was coined by Darcy DiNucci, an information architecture consultant, in her January 1999 article "Fragmented Future" [...] her "2.0" designation refers to the next version of the Web that does not directly relate to the term's current use.
> The term Web 2.0 did not resurface until 2002.
Google's first big Web 2.0 products were GMail (beta launched in 2004, just before Google's IPO) and Google Maps (2005).
What is going on with AI right now could be a bubble just like there was the dotcom bubble. But it isn't like the internet went away after the dotcom burst. The largest companies in existence today are internet companies or have products that wouldn't make sense without the internet.
Sure, many of these "thin prompt wrapper around the OpenAI API" product "businesses" will all be gone within a few years. But AI? That is going to be here indefinitely.
i have to say I'm a little disgusted by these statements. LLMs are useful for many problems, but is there really a conceivable path of them making progress into fighting the countless cancers tormenting humanity?
My framing device: if you had LLMs in the 1500s, how would that help Copernicus determine the orbits of the planets? Maybe through dumb chance, but creating a well reasoned model of the universe required new observations and the ability to interpret the data from a different point of view.
All the 1500s and earlier data that such an LLM would have to have been trained on would lead to an LLM that wouldn’t ever suggest a heliocentric solar system. That LLM might even say he was heretical or refuse to give an answer to anything that led to it saying that the earth wasn’t the centre of the universe. So no help at all.
Interesting framing. Although I assume all the observations had been done already. It was more about being bold enough to investigate a line of thought that wasn't obvious or popular at the time and proving it convincingly.
They already had many "explanations" and models for why the planets were seemingly moving back and forth in the sky during the year. Their models were more complicated than necessary simply because they didn't want to consider the different premise.
The technology - for what it is being used vs what is invested - does not match up at all. This is what happened to the dot-com bubble. Theres was a whole bunch of innovation that was needed to come to bring a delightful UX to bring swathes of people onto the internet.
So far this is true about LLMs. Could this change? Sure. Will it change meaningful? Personally I dont believe so.
The internet at its core was all about hooking up computers so they they could transform from just computational beasts to communication. There was a tremendous amount of potentitial that was very very real. It just so happens if computers can communicate we can do a whole bunch of stuff - as is going on today.
What are LLMS? Can someone please explain in a succint way...? Im yet to see something super crystal clear.
Things like recommendations, ads, and search will always be around because they were money printers before VCs found out about AI and they will continue to be long after.
The dotcom bubble was not about "the internet" itself. The Internet was fine and pretty much already proven as a very useful communication tool. It was about business that made absolutely no sense getting extremely high valuations just because they operated - however vaguely - over the internet.
Generative AI have never reached the level of usability of the Internet itself, and likely never will.
If you're asking yourself why hasn't the bubble burst when everyone is calling it a bubble it's because no one wants to stop dancing until the music stops. If you told an investor the market will collapse tomorrow with 100% certainty they will invest today like there is 0% certainty of it happening tomorrow.
> “That is what is going to happen here too. This is real, the benefits to society from AI are going to be gigantic.”
As an owner of a web host that probably sees advantage to increased bot traffic, this statement is just more “just wait AI will be gigantic any minute now, keep investing in it for me so my
investments stay valuable”.
By society, he means the oligarchy will get more power and control.
Yeah, sure some side benefits to people. AI is still a nuclear weapon against labor in the capital - labor (haves - haves not), and will start pushing wealth inequality to the Egyptian pharoah.
The only good news for plebians is that virtual reality entertainment means you just need a little closet to live in.
Overall, this just leads up to further demographic decline, which as an environmental malthusian I would welcome in the initial stages to get us down from our current level, but I also suspect it would turn into an economic downward spiral, especially with AI, where the oligarchs have such total authoritarian control and monopoly on resources that humanity basically stops having kids at all.
"AI is in a bubble but billionaires will get 'gigantic' benefits"
I see no benefit to anyone unless you can live off your stock portfolio and can easily ride through periods where your portfolio can suffer a 50% loss.
Honestly, during the dotcom bubble at least workers were getting paid and jobs were abundant. Things didn't start getting bad for workers until it popped. We're supposed to be in the 'positive' part of the AI bubble and people already seem desperate and out of hope.
Everyone not directly involved seems to want AI to pop. I'm not sure if that says anything about its longevity. Not very fun to have a bubble that feels bad on both sides.
He may be right, everything points to that conclusion. My main issue is - why the fuck do we care what Bezos thinks on this matter? His ML efforts all lag behind the competition and he’s certainly not an expert in the field of deep learning. Why?
He's (unsurprisingly) making an analogy to the dotcom bubble, which seems to me correct. There was a bubble, many non-viable companies got funded and died, and nevertheless the internet did eventually change everything.
The biggest problem is the infrastructure left behind from the Dotcom boom that laid the path for the current world (the high speed fiber) doesn't translate to computer chips. Are you still using intel chips from 1998? And the chips are such a huge cost, and being backed by debt but they depreciate in value exponentially. It's not the same because so much of the current debt fueled spending is on an asset that has very short shelf life. I think AI will be huge, I don't doubt the endgame once it matures. But the bubble now, spending huge amounts on these data centers using debt without a path to profitability (and inordinate spending on these chips) is dangerous. You can think AI will be huge and see how dangerous the current manifestation of the bubble is. A lot of people will get hurt very very badly. This is going to maim the economy in a generational way.
And a lot of the gains from the Dotcom boom are being paid back in negative value for the average person at this point. We have automated systems that waste our time when we need support, product features that should have a one-time-cost being turned into subscriptions, a complete usurping of the ability to distribute software or build compatible replacements, etc..
The Dotcom boom was probably good for everyone in some way, but it was much, much better for the extremely wealthy people that have gained control of everything.
If you're ever been to a third world country then you'd see how this is completely untrue. The dotcom boom has revolutionized the way of life for people in countries like India.
Even for the average person in America, the ability to do so many activities online that would have taken hours otherwise (eg. shopping, research, DMV/government activities, etc). The fact that we see negative consequences of this like social network polarization or brainrot doesn't negate the positives that have been brought about.
I think you’re putting too much weight on cost (time, money), and not enough weight on “quality of life”, in your analysis.
For sure, we can shop faster, and (attempt) research and admin faster. But…
Shopping: used to be fun. You’d go with friends or family, discuss the goods together, gossip, bump into people you knew, stop for a sandwich, maybe mix shopping and a cinema or dinner trip. All the while, you’d be aware of other peoples’ personal space, see their family dynamics. Queuing for event tickets brought you shoulder to shoulder with the crowd before the event began… Today, we do all this at home; strangers (and communities) are separated from us by glass, cables and satalites, rather than by air and shouting distance. I argue that this time saving is reducing our ability to socialise.
Research: this is definitely accelerated, and probably mostly for the better. But… some kinds of research were mingled with the “shopping” socialisation described above.
Admin: the happy path is now faster and functioning bureaucracy is smoother in the digital realm. But, it’s the edge cases which are now more painful. Elderly people struggle with digital tech and prefer face to face. Everyone is more open to more subtle and challenging threats (identity theft, fraud); we all have to learn complex and layered mitigation strategies. Also: digital systems are very fragile: they leak private data, they’re open to wider attack surfaces, they need more training and are harder to intuit without that training; they’re ripe for capture by monopolists (Google, Palantir).
The time and cost savings of all these are not felt by the users, or even the admins of these systems. The savings are felt only by the owners of the systems.
Technologgy has saved billions of person-hours individual costs, in travel, in physical work. Yet, wemre working longer, using fewer ranges of motions, are less fit, less able to tolerste others’ differences and the wealth gap is widening.
Yes, this is true. There used to be a lot of local book stores, for example. Amazon optimized that away, while ruining social fabric.
Independent book stores are booming in quantity since the initial Internet crash.
Be careful about making narratives that don’t line up with industry data.
There’s a lot of brick and mortar retail going on. It just doesn’t look like the overbuilt mall infrastructure of the 1970s-1980s.
RIP literacy in America. We hardly knew ye.
Recall that the arXiv was established in 1991, many years before the dotcom bubble. Many scientists still use arXiv prominently for research.
It seems the crux is that we needed X people to produce goods, and we had Y demand.
Now we need X*0.75 people to do meet Y demand.
However, those savings are partially piped to consumers, and partially piped to owners.
There is only so much marginal propensity to spend that rich people have, so that additional wealth is not resulting in an increase in demand, at least commensurate enough to absorb the 25% who are unemployed or underemployed.
Ideally that money would be getting ploughed back into making new firms, or creating new work, but the work being created requires people with PHDs, and a few specific skills, which means that entire fields of people are not in the work force.
However all that money has to go somewhere, and so asset classes are rising in value, because there is no where else for it to go.
> Now we need X0.75 people to do meet Y demand.*
This is how GDP/person has increased 30x the last 250 years.
What always happens is that the no longer needed X*0.25 people find new useful things to do and we end up 33% richer.
"we end up."
It's actually, "they end up" and the 33% gains you're talking about aren't realized en masse until all the coal miners have black lung. It's really quite the, "dealy" as Homer Simpson would say. See, "Charles Dickens" or, "William Blake" for more. #grease
> partially piped to consumers, and partially piped to owners.
Or, the returns on capital exceed the rate of economic growth (r > g), if you like Piketty's Capital in the Twenty First Century.
One of the central points is about how productivity and growth gains increasingly accrue to capital rather than labor, leading to capital accumulation and asset inflation.
Yep, that’s the source of the point. The effort is in finding a way to make it easy to convey. Communication of an idea is almost as critical as its verification now.
I just need to read it one of these days. I keep reading parts of it but never sitting down with it.
You're in luck! A couple years ago he released an "abridged version" of sorts. A Brief History of Inequality is the name. Much more accessible than the 700 pages of Capital in the 21st Century.
https://en.m.wikipedia.org/wiki/Special:BookSources/97806742...
Oh hell, don’t make me feel bad. I’ve got a meager capacity to trudge through major papers. I cheer you on.
With telecom, we benefited from skipping generations. I got into a telecom management program because in 2001-ish, I was passed by on a village street by a farmer bicycling while talking on his cellphone. Mind you my family could not afford cellphone call rates at the time.
In fact, the technology was introduced out here assuming corporate / elite users. The market reality became such that telcos were forced kicking and screaming to open up networks to everybody. The Telecom Regulatory Authority of India (back then) mandated rural <> urban parity of sorts. This eventually forced telcos to share infrastructure costs (share towers etc.) The total call and data volumes are eye-watering, but low-yield (low ARPU). I could go on and on but it's just batshit crazy.
Now UPI has layered on top of that---once again, benefiting from Reserve Bank of India's mandate for zero-fee transactions, and participating via a formal data interchange protocol and format.
Speaking from India, having lived here all my life, and occasionally travelled abroad (USAmerica, S.E. Asia).
We, as a society and democracy, are also feeling the harsh, harsh hand of "Code is Law", and increasingly centralised control of communication utilities (which the telecoms are). The left hand of darkness comes with a lot of darkness, sadly.
Which brings me to the moniker of "third world".
This place is insane, my friend --- first, second, third, and fourth worlds all smashing into each others' faces all the time. In so many ways, we are more first world here than many western countries. I first visited USAmerica in 2015, and I could almost smell an empire in decline. Walking across twitter headquarters in downtown SF of all the places, avoiding needles and syringes strewn on the sidewalk, and avoiding the completely smashed guy just barely standing there, right there in the middle of it all.
That was insane.
That kind of extreme poverty juxtaposed to extreme wealth, and all of the social ills that come along with it, have always been a fixture of the American experience. I don’t think it’s a good barometer or whether the USA is in decline when there has long been pockets of urban decay, massive inequality, drug use etc. Jump back to any point in American history and you’ll find something similar if not much, much worse. Even in SF of all places, back in the wild west era gold rush or in the 1970s… America has always held that contradiction.
Yeah, I sort of recounted a stark memory. That juxtaposition was a bit too much.
However, it wasn't just that, and the feeling has only solidified in three further visits. It isn't rational, very much a nose thing, coming from an ordinary software programmer (definitely not an economist, sociologist, think tank).
AI itself is a manifestation of that too, a huge time waster for a lot of people. Getting randomly generated wrong but sounding right information is very frustrating. Start asking AI questions you already know the answer too and the issues can become very obvious.
Don’t say that, you’ll hasten the Antichrist!
(For those who missed it: https://www.theverge.com/ai-artificial-intelligence/785407/p... )
> The Dotcom boom was probably good for everyone in some way, but it was much, much better for the extremely wealthy people that have gained control of everything.
You are describing platform capture. Be it Google Search, YouTube, TikTok, Meta, X, App Store, Play Store, Amazon, Uber - they have all made themselves intermediaries between public and services, extracting a huge fee. I see it like rent going up in a region until it reaches maximum bearable level, making it almost not worth it to live and work there. They extract value both directions, up and down, like ISPs without net-neutrality.
But AI has a different dynamic, it is not easy to centrally control ranking, filtering and UI with AI agents. You can download a LLM, can't download a Google or Meta. Now it is AI agents that got the "ear" of the user base.
It's not like before it was good - we had a generation of people writing slop to grab attention on web and social networks, from the lowest porn site to CNN. We all got prompted by the Algorithm. Now that Algorithms is replaced by many AI agents that serve users more directly than before.
>You can download a LLM, can't download a Google or Meta.
You can download a model. That doesn't necessarily mean you can download the best model and all the ancillary systems attached to it by whatever service. Just like you can download a web index but you probably cannot download google's index and certainly can't download their system of crawlers for keeping it up to date.
That's true for the GPUs themselves, but the data centers with their electricity infrastructure and cooling and suchlike won't become obsolete nearly as quickly.
How much more of centralized data center capacity we actually need outside AI? And how much more we would need if we used slightly more time on doing things more efficiently?
this is a good point, and it would be interesting to see the relative value of this building and housing 'plumbing' overhead Vs the chips themselves.
I guess another example of the same thing is power generation capacity, although this comes online so much more slowly I'm not sure the dynamics would work in the same way.
The data centers built in 1998 don't have nearly enough power or cooling capacity to run today's infrastructure. I'd be surprised if very many of them are even still in use. Cheaper to build new than upgrade.
How come? I'd expect that efficiency gains would lower power and thus cooling demands - are we packing more servers into the same space now or losing those gains elsewhere?
This is true. It’s probably 2-3 times as long as a GPU chip. But it’s still probably half or a quarter of the depreciation timeline of a carrier fiber line.
Even if the building itself is condemnable, what it took to build it out is still valuable.
To give a different example, right now, some of the most prized sites for renewable energy are former coal plant sites, because they already have big fat transmission lines ready to go. Yesterday's industrial parks are now today's gentrifying urban districts, and so on.
That’s true. The permitting is already dealt with, and that’s substantial lead time on any data center build.
Evnn moreso for carrier lines of course. Nimbyism is a strong block on right-of-way needs (except the undersea ones obviously).
One thing to note about modern social media is that the most negative comment tends to become the most upvoted.
You can see that all across this discussion.
Companies want GW data centers, which are a new thing that will last decades, even if GPUs are consumable and have high failure rates. Also, depending on how far it takes us, it could upgrade the electric grid, make electricity cheaper.
And there will also be software infrastructure which could be durable. There will be improvements to software tooling and the ecosystem. We will have enormous pre-trained foundation models. These model weight artifacts could be copied for free, distilled, or fine tuned for a fraction of the cost.
There are probably a lot of cool and useful things you could do with a bunch of data centers full of GPUs.
- better weather forecasts
- modeling intermittent generation on the grid to get more solar online
- drug discovery
- economic modeling
- low cost streaming games
- simulation of all types
- cloud gaming service? :D
Eh not really. Maybe retro cloud gaming services. But games haven't stopped getting more demanding every year. Not only are the AI GPUs focused on achieving clusters with great compute performance per watt and dollar rather than making singular GPUs with great raster performance; even the GPUs which are powerful enough for current games won't be powerful enough for games in 5 years.
Not to mean that we're still nowhere near close to solving the broadband coverage problem, especially in less developed countries like the US and most of the third world. If anything, it seems like we're moving towards satellite internet and cellular for areas outside of the urban centers, and those are terrible for latency-sensitive applications like game streaming.
> But games haven't stopped getting more demanding every year.
This is not particularly true.
Even top of the line AAA games make sure they can be played on the current generation consoles which have been around for the last N years. Right now N=5.
Sure you’ll get much better graphics with a high end PC, but those looking for cloud gaming would likely be satisfied with PS5 level graphics which can be pretty good.
If you look at year over year chip improvements in 2025 vs 1998, it's clear that modern hardware just has a longer shelf life than it used to. The difficulties in getting more performance for the same power expenditure are just very different than back in the day.
There's still depreciation, but it's not the same. Also look at other forms of hardware, like RAM, and the bonus electrical capacity being built.
In 1998 to transfer a megabyte over telephone lines was expensive and 5 years later is was almost free.
I have not seen the prices of GPUs, CPU or RAM going down, on the contrary, each day it gets more expensive.
But why not measure $ per intelligence. In 2020 you'd need a billion dollars to get your computer to write good code, now it is practically free.
> This is going to maim the economy in a generational way.
Just as I'm getting to the point where I can see retirement coming from off in the distance. Ugh.
> the current debt fueled spending
Honestly I think the most surprising thing about this latest investment boom has been how little debt there is. VC spending and big tech's deep pockets keep banks from being too tangled in all of this, so the fallout will be much more gentle imo.
We don’t have moores law anymore. Why are the chips obseleting so quickly?
FLOP/s/$ is still increasing exponentially, even if the specific components don't match Moore's original phrasing.
Markets for electronics have momentum, and estimating that momentum is how chip producers plan for investment in manufacturing capacity, and how chip consumers plan for deprecation.
They kind of aren't. If you actually look at "how many dollars am I spending per month on electricity", there's a good chance it's not worth upgrading even if your computer is 10 years old.
Of course this does make some moderate assumptions that it was a solid build in the first place, not a flimsy laptop, not artificially made obsolete/slow, etc. Even then, "install an SSD" and "install more RAM" is most of everything.
Of course, if you are a developer you should avoid doing these things so you won't get encouraged to write crappy programs.
my 486sx with math co-processor is long gone.
About 40% of AI infrastructure spending is the physical datacenter itself and the associated energy production. 60% is the chips.
That 40% has a very long shelf life.
Unfortunately, the energy component is almost entirely fossil fuels, so the global warming impact is pretty significant.
At this point, geoengineering is the only thing that can earn us a bit of time to figure...idk, something out, and we can only hope the oceans don't acidify too much in the meantime.
Interesting. Do you have any sources for this 60/40 split? And while I agree that the infrastructure has a long shelf life, it seems to me like an AI bubble burst would greatly depreciate the value of this infrastructure as the demand for it plummets, no?
They're only replacing GPUs because investors will give "free" money to do so. Once the bubble pops people will realize that GPUs actually last a while.
I am not still using the same 1Mbps token ring from 1998 or the same dial up connecting to some 10Mbps backbone.
I am using x86 chips though.
Intel chips from 2008, as there is no real improvements.
A lot of the infrastructure made during the Dotcom boom was shortly discarded. How many dial-up modems were sold in the 90s?
The current AI bubble is leading to trained models that won't be feasible to retrain for a decade or longer after the bubble bursts.
The wealth the Dotcom boom left behind wasn't in dial up modems or internet over the telephone, it was in the huge amounts of high speed fiber optic networks that were laid down. I think a lot of that infrastructure is still in use today, fiber optic cables can last 30 years or more.
> fiber optic cables can last 30 years or more
The trenches for the cables even longer than that.
How much of it is still dark?
Honestly, not that many people had modems.
In the late 90s to 2001? Many people were still using modems at that time. Cable or DSL wasn't even an option for a considerable percentage of the population.
In 2000 6% of the population had access to internet.
In 2002 I was woking making webs and setting up linux servers and I did not have internet at home.
This is pretty location specific—in the US 42% of households had home internet in 2000.
https://www.statista.com/statistics/189349/us-households-hom...
That web is not a good source.
Yes it is.
Low Global Penetration: Only 361 million people had internet access worldwide in 2000, a small fraction of the global population. Specific Country Examples United States: The US had a significant portion of the world's internet users, making up 31.1% of all global users in 2000. Its penetration rate was 43.1%.
Not still using, flat out modemless. Lots of guys got their hand on a mouse for the first time only after Windows XP launched. Which was after the collapse.
Windows 95 didnt even have Internet by default.
It had the Microsoft network or whatever it was called.
Personally I think people should stop trying to reason from the past.
As tempting as it is, it leads to false outcomes because you are not thinking about how this particular situation is going to impact society and the economy.
Its much harder to reason this way, but isnt that the point? personally I dont want to hear or read analogies based on the past - I want to see and read stuff that comes from original thinking.
Doesn't that line of reasoning leave you in danger of being largely ignorant? There's a wonderful quote from Twain "History doesn't repeat itself but it often rhymes" there are two critical things I'd highlight in that quote - first off the contrast between repetition and rhyming is drawing attention to the fact that things are never exactly the same - there's just a gist of similarities - the second is that it often but doesn't always rhyme - this sure looks like a bubble but it might not be and it might be something entirely new. _That all said_ it's important to learn from history because there are clear echoes of history in events because we, people in general, don't change that fundamentally.
IME the number of times where people have said "this time it's different" and been wrong is a lot higher than the number of times they've said "this time is the same as the last" and been wrong. In fact, it is the increasing prevalence of the idea that "this time it's different" that makes me batten down the hatches and invest somewhere with more stability.
With all due respect, Im not here to teach people how to think.
This guy gets it - https://www.youtube.com/watch?v=kxLCTA5wQow
Instead of plainly jumping on the bubble bandwagon he actually goes through a thorough analysis.
This won’t even come close to maiming the economy, that’s one of the more extreme takes I’ve heard.
AI is already making us wildly more productive. I vibe coded 5 deep ML libraries over the last month or so. This would have taken me maybe years before when I was manually coding as an MLE.
We have clearly hit the stage of exponential improvement, and to not invest basically everything we have in it would be crazy. Anyone who doesn’t see that is missing the bigger picture.
Video game crash followed by video games taking off and eclipsing most other forms of digital entertainment.
Dot com crash followed by the web getting pretty popular and a bit central to business.
To all those betting big on AI before the crash:
Careful, Icarus.
Many AI startups around LLMs are going to crash and burn.
This is because many people have mistaken LLMs for AI, when they’re just a small subset of the technology - and this has driven myopic focus in a lot of development, and has lead to naive investors placing bets on golden dog turds.
I disagree on AI as a whole, however - as unlike previous technologies this one can self-ratchet and bootstrap. ML designed chips, ML designed models, and around you go until god pops out the exit chute.
Bad comparison.
The leap of faith necessary in LLMs to achieve the same feat is so large its very difficult to imagine it happening. Particularly due to the well known constraints on what the technology is capable of.
The whole investment thesis of LLMs is that it will be able to a) be intelligent b) produce new knowledge. If those two things that dont happen, what has been delivered is not commensurate to the risk in regards to the money invested.
Given they're referencing Icarus, they seem to agree with you.
Past bubbles leaving behind something of value is indeed no guarantee the current bubble will do so. For as many times as people post "but dotcom produced Amazon" to HN, people had posted that exact argument about the Blockchain, the NFT, or the "Metaverse" bubbles.
> Careful, Icarus.
What does that even mean?
pets.com was a fat loser only telling telling people that were going to fly.
Amazon was Icarus, they did something.
Vs weak commentators going on about the wax melting from their parents root cellar while Icarus was soaring.
Most of Y Combinator are not using AI they just say that and you're worried about the people who do things?
> commentators going on about the wax melting from their parents root cellar while Icarus was soaring.
Icarus drowned in the sea.
Even if you want to put the world into only two lumps of cellar dwellers and Icaruses it is still a group of living people on one side and a floating/semi-submerged pile of dead bodies that are literally only remembered for how stupid their deaths were on the other.
Dotcom mania companies were not Internet providers. They tried making money on the internet, something people already saw as worth paying for.
Cisco, Level3 and WorldCom all saw astronomical valuation spikes during the dotcom bubble and all three saw their stock prices and actual business prospects collapse in the aftermath of it.
Perhaps the most famous implosion of all was AOL who merged (sort of) with TimeWarner gaining the lion's share of control through market cap balancing. AOL fell so destructively that it nearly wiped out all the value of the actual hard assets that TW controlled pre-merger.
This is not really true, e.g. Cogent was basically created by buying bankrupt dotcum-bubble network providers for cents on the dollar.
Also AOL was a mix of dialup provider and Dotcom service. There were many other popular examples of such.
I don't think it is fair to characterize AOL as a bubble baby- they were a thing before that
Nor I dont think Coget, GX or Level-3 were dotcom companies.
And what were the societal benefits of the internet?
That everybody all over the world can instantly connect with each other?
I would add more metrics to think about. For example, very few people used Internet in the dotcom era while now the AI use is distributed into all the population using the Internet that will probably not growth too much. In this case, if Internet population is the driver, and it will not growth significantly we are redistributing the attention. Assuming "all" society will be more productive we will all be in the same train at the relatively same speed.
The analogy to the dot com bubble is leaky at best. AI will hit a point of exponential improvement, we are already in the outer parts of this loop.
It will become so valuable so fast we struggle to comprehend it.
While this remains possible my main impression now is that progress seems to be slowing down rather than accelerating.
I'm not so sure about this.
First were the models. Then the APIs. Then the cost efficiencies. Right now the tooling and automated workflows. Next will be a frantic effort to "AI-Everything". A lot of things won't make the cut, but absolutely many tasks, whole jobs, and perhaps entire subsets of industries will flip over.
For example you might say no AI can write a completely tested, secure, fully functional mobile app with one prompt (yet). But look at the advancements in Cline, Claude code, MCPs, code execution environments, and other tooling in just the last 6 months.
The whole monkeys typewriters shakespeare thing starts to become viable.
Not even remotely. In LLM land, the progress seems slow the past few years, but a lot has happened under the hood.
Elsewhere in AI however progress has been enormous, and many projects are only now reaching the point where they are starting to have valuable outputs. Take video gen for instance - it simply did not exist outside of research labs a few years ago, and now it’s getting to the point where it’s actually useful - and that’s just a very visible example, never mind the models being applied to everything from plasma physics to kidney disease.
Maybe once we get another architecture breakthrough, it won't feel so slow.
> [At dotcom time] There was a bubble, many non-viable companies got funded and died, and nevertheless the internet did eventually change everything.
It did, but not for the better. Quality of life and standard of living both declined while income inequality skyrocketed and that period of time is now known as The Great Divergence.
> He's (unsurprisingly) making an analogy to the dotcom bubble, which seems to me correct.
He's got no downside if he's wrong or doesn't deliver, he's promising an analogy to selling you a brand new bridge in exchange for taking half of your money... and you're ecstatic about it.
Thank you for acknowledging this. The internet was created around a lot of lofty idealism and none of that has been realized other than opening up the world's information to a great many. It made society and the global economy worse (occidental west; Chinese middle class might disagree) and has paralleled the destabilization of geopolitics. I am not luddite but until we can, "get our moral shit together" new technologies aren't but fuel on the proverbial fire.
Glad to be in agreement. The higher message here is that technology is no substitute for politics, cue crypto-hype which produced little more than crime and money-laundering. Without proper policies, corruption invades every strata of society.
Seems like society isn't going to benefit much, but the ultrawealthy will benefit enormously.
To those who have everything more will be given; from those who have nothing everything will be taken.
Of course they will, the ultra wealthy are too big to fail. In a bubble like this, they just invest in pretty much everything and take the losses on the 99% of failures to get the x1000 multiples on the 1% of successes. While the rest of us take the hit.
I'm paying for 3 different AI services and our company and most of my team is also paying money for various AI stuff. Sounds like a real industry to me. There's just going to be VC losers as always, where usually "losing" is getting bought by a bigger company or aquihires instead of 100xing or going public.
My team is doing the same, and yet all of us still aren't sure that we're actually more productive overall.
If anything it seems to me like we've just swapped coding with what is effectively a lot more code review (of whatever the LLM spits out), at the cost of also losing that long term understanding of a block of code that actually comes from writing it yourself (let's not pretend that a reviewer has the same depth of understanding of a piece of code as an author).
The problem is the hype machine that is claiming it will replace human labor which justifies the insane losses.
These companies are burning cash to support the current formulation of AI services.
These services will survive because they are useful but probably not at its current cost
Those companies are also likely still in the red. They're banking on the hope that one day they will be profitable. I'm sure one of them will be.
HN said the same thing about Uber forever.
For almost 20 year, Amazon has been the poster child of "A company can be unprofitable for years and still turn out a winner", but of course - not all companies can pivot from being a regular e-commerce company to cloud infrastructure/hosting, and become a money machine.
So the question, at least to me, is how these AI companies will find a product or service that makes them profitable. Other than becoming actual monopolies in their current domains.
Uber didn't invent anything, they drove taxis out of business then jacked up the prices, squeezed the workers, and now everybody is riding around in regular people's crappy cars for more than a cab cost. And now I need a phone and to maintain my relationship with these two crappy companies rather than to wave at the street (which is what I used to do to get a ride.)
That was literally what everybody said would happen.
> Uber didn't invent anything
They didn't. They innovated, practically implemented ideas that resulted in the introduction of new goods and services [1]. This is a meaningful difference.
Uber didn't invent anything. But they did pull ridesharing out of a hat.
[1] https://en.wikipedia.org/wiki/Innovation
I think Uber invented (or at least made widely available) taxi-by-app. Having scores of cab companies, accessed by telephone call, was supremely user-hostile.
If the cab companies had gotten together on an app, they might have shortcut Uber and all of its many dubious practices. They finally are starting to but it's much too late.
Taxi-by-app existed pre-Uber, the innovation was making the taxi actual show up. Austin had the apps, and I would order one, and the taxis would get distracted on the way to my house and pick up other fares, so I couldn't go where I wanted. They had every chance to not be outcompeted by Uber, but they couldn't stop being taxis. And, here we are.
Not only did taxi by app exist way earlier, it was also wide spread ... in some big countries.
> the innovation was making the taxi actual show up
Uber regularly doesn’t show up, just playing with “4… 3… 6… minutes left”. I always have to wait half an hour at a certain location, with a message “Just book a few minutes before your trip.”
I’ve had a friend miss his flight because of Uber not showing up!
I think you're definitely in the minority. For most of the world, Uber/Grab/Bolt have made transportation cheaper, safer, more convenient, and more comfortable.
Uber definitely screwed the workers and probably existing taxi companies, but for the users it was a huge W, at least in many parts of the world. Taxi companies are notoriously scammy and it seems to be a very universal experience.
It completely changed an industry. Just because you don't like the current version doesn't mean it wasn't a major innovation. Uber was just the main player in scaling and marketing a new model across the entire globe, which was a huge and costly endeavor.
LLMs have already changed how software can be written and a thousands of other business/consumer usecases, these companies are just battling it out and finding the most profitable niches. It will be a major business for a long time and the technology will mature and plateau pretty quickly. If R&D doesn't scale economically, it will just slow down and existing models will be heavily optimized to be cheaper to run.
The dot com boom resulted in very few real industries and comparing the two is not very useful.
> rather than to wave at the street (which is what I used to do to get a ride.)
Ummm taxis aren't everywhere like NYC or something. Broadly speaking Uber will pick you up in an arbitrary place and take you anywhere.
Uber is way cheaper and better than any cab ever was.
From my experience, this is not the case in many european cities. In those places the main benefit seems to be not having to interact with the cab driver.
You don't talk to your drivers? I've had a lot of genuinely good conversations in my rides. I always at least feel it out and see how much the driver wants to talk but it feels wrong to not say anything
Is that still true?
Uber sold something like $50 billion in equity and debt before it went public, and although they're profitable now, to me it doesn't seem like they have answer to Waymo coming up fast in the rear-view mirror. I think Uber is still a scam, just one where the earlier investors fleeced the later ones who are never going to see the returns they paid for.
Uber is still >$10bn net negative over its lifetime. Claude estimates about –$19bn.
It's still quite possible that Uber doesn't make that up in the near future.
> 3 different AI services
Why three? Will you ever be in a position where one will do it for you?
> and most of my team is also paying money for various AI stuff.
And what are they using it for?
> Sounds like a real industry to me.
Sounds like early adopter syndrome to me. We'd have to know more about your business to take this out of the realm of hazy anecdotes.
A real industry can be a bubble too. Not every bubble looks like tulips.
For example:
- Dotcom bubble. Of course making website was and is a real industry.
- Japanese real estate bubble. Of course building houses was and still is a real industry. It's so real people call it real estate, right.
are you paying them enough to have profitable unit economics? How hard would it be for you to switch from one provider to another?
Seems like a measured approach- my read is him saying it’s probably a bubble in that bad ideas are being funded too, but there are a lot of really good ideas doing well.
Also nit: Typo right in the digest I assume, assuming “suring” is “during”, does cnbc proofread their content?
Typos are proof something wasn't Ai written. Everyone should make at least one tyop in their writing.
"Claude, make sure to sprinkle at least one typo in here. And no em dashes you hear?"
Faculty at the college I work for are kicking and screaming about AI and students using AI. They don't want to use new tools so they're just trying to outright ban students from using them.
One smug English faculty said, "well it's not that hard. You just look for dashes in their writing."
I responded with, "you know you can just tell it not to use those, right?"
Blank stares.
I hate it.
The writing is a mandatory part of the learning process. Outsourcing it to tools is skipping and cheating. Nothing new here. It was the same when the tool was your buddy or upwork before LLMs.
Banning advanced graph calculators on undergrad math exams is not because "they don't want to use new tools", either.
Sure but there's also a continuum of practice between banning outright and letting the students use llm's to just write for them.
Use it as a peer review. Use it during brainstorming. Use it to clarify ambiguous thoughts. Use it to challenge your arguments and poke holes in your assumptions.
The sad difference that makes a difference is that banning graphing calculators from proctored exams is enforceable in practice.
Appealing to honor is a partial solution at best. Cheating is a problem at West Point, let alone the majority of places with a less disciplined culture. It's sad, but true. The fact that you and I would never cheat on exams simply does not generalize.
https://www.armytimes.com/news/your-army/2021/04/18/51-west-...
edit: good on West Point for actually following up on the cheating. I've witnessed another institution sweeping it under the rug even when properly documented and passed up two or three levels of reporting. As an academic director and thus manager of professors this was infuriating and demoralizing for all concerned.
Time to crack out the faraday cage!
I dont see anything reason at all to expect West Point to have less cheating then anywhere else. Army people dont commit crimes less then civilians either.
It's sad. I use dashes in my writing all the time. I've had to consciously pause and make an effort not to use them in my emails now.
Indeed, the very dashes the English teacher taught me to use.
If you didn't write it, you don't deserve credit for it. You don't learn by outsourcing your work to a piece of software.
Only worms until the typos get into the training data. You need to say at least one thing no one has ever said before in every post.
R9k wins again
I see what ya did tbere :)
Then it’s a market for lemons. Buyers can’t (or choose not to) tell a good AI idea from a bad one.
A market for lemons means there is an information asymmetry. Sellers know what they have and try to offload their lemons on clueless buyers. I don't think that's the case here.
It is indeed hard to tell how many of the people selling this stuff are True Believers. It's also a bit scary, given how incredibly implausible some of these stuff they're saying is.
irony level IV
Apparently not. An LLM proofread would've definitely caught that
All the smartest people I know in finance are preparing for AI to be a huge bust that wipes out startups. To them, everyone in tech is just a pawn in their money moving finance games. They view Silicon Valley at the moment salivating on what there plays are to make money off the coming hype cycle implosion. The best finance folks make the most money when the tide goes out… and they’re making moves now to be ready.
Take that for what it is.
Especially startups in AI are at risk, because their specific niche projects can easily be outcompeted when BigTech comes with more generalized AI models.
Just startups? Really?
Broader impact, but while the big players will take a hit the new wave of startups stands to take the brunt of the impact. VCs and startups will suffer the most.
At the end of the day though it’s how the system is designed. It’s the needed forrest fire that wipes out overgrowth and destroys all but the strongest trees.
I'll take it for finance people being totally clueless, right? Have you talked to these people about AI?
My experience has gone the other way than OOP: Anecdotally, I have had VCs ask me to review AI companies to tell them what they do so they can invest. The VC said VCs don't really understand what they're investing in and just want to get in on anything AI due to FOMO.
The company I reviewed didn't seem like a great investment, but I don't even think that matters right now.
To be clear when I said “finance folks” I wasn’t really referring to VCs. I’m talking more family office types that manage big pools of money that you don’t know about. The super wealthy class that has literally has more money than the King but would be horrified if you knew their name. Old money types. They’re well aware of the “dumb VC” vibe that just throws money after hype. The finance folks I’m talking about are the type that eat failed VCs for lunch.
And what is it that you believe about these old money types' knowledge of AI and why is it that you believe it?
In my experience they invariably conflate LLMs with AI and can’t/won’t have the difference explained.
This is the blind spot that will cause many to lose their shirts, and is also why people are wrong about AI being a bubble. LLMs are a bubble within an overall healthy growth market.
LLMs are a bubble on the back of an AI bubble in a market finally surmounting an enormous single-shot energy surfeit
"During bubbles, every experiment or idea gets funded, the good ideas and the bad ideas. And investors have a hard time in the middle of this excitement, distinguishing between the good ideas and the bad ideas. ... But that doesn't mean anything that is happening isn't real."
Remind me again why we need investors to fund bad ideas? The whole premise of western capitalism is that investors can better align with the needs of the society and the current technological reality.
If the investors aren't the gurus we make them to be, we might as well do with a planning committee. We could actually end up with more diversified research.
"Under socialism, a lot of experimental ideas get funded, the good ideas and the bad ideas. And the planning committee have a hard time in the middle of this excitement, distinguishing between the good ideas and the bad ideas. ... But that doesn't mean anything that is happening isn't real."
We need investors to fund ideas to find out if they are good or bad. It is called testing.
> Remind me again why we need investors to fund bad ideas?
A lot of good ideas only look bad in hindsight. It costs time and money to determine goodness, and that deserves funding.
Committees' investment tends to be not very diversified and often too risk-averse because of how blame placing works. E. g. most of soviet's cloning of chip (and many other products) wasn't due to lack of engineering skill - it's just less risk for the bureaucrats running the show. R&D for an original chip is risky and timing it to the next November the seventh is likely to not work. Cloning is a guaranteed success.
The whole point of capitalism is that one is entitled to the consequences of their own stupidity or the lack thereof. The investors are more willing to take the risks because their losses are bounded - they are risking only as much as they are willing, rather than their status in an organization. Of course once all investors ends up investing into the same bubble there is no real advantage over a committee.
> Remind me again why we need investors to fund bad ideas?
Early stage investors generally fund a portfolio of multiple ideas, where each idea faces great uncertainty - some investments will do tremendously well, some won't. Invstors don't need every investment to do well due to the assymmetry of outcomes (a bad investment can at worst go down 100%, a good investment can go up 10,000%, paying off many bad investments).
> The whole premise of western capitalism is that investors can better align with the needs of the society and the current technological reality.
This is not the premise of capitalism, it's the justification for it - it's generally believed that capitalism leads to better outcomes over time than communism, but that doesn't mean capitalism has 0 wasteage or results in 0 bad decisions.
There is a very important difference: real investors risk their own money, the money they saved over their entire life making decisions.
Under socialism bureaucrats risk someone else's money.
We are not in a pure capitalistic society, we also have States, central Banks with central planning expending over half the money in Europe and USA and more than half in Asia.
As a European myself that see the public money being wasted by incompetent people and filling the pockets of politicians, specially marxist ones. For example, the money Spain received after COVID filled so many socialist pockets and has not given information back to Europe as of how it was spent(it was spent on their own companies of friend and family).
>> There is a very important difference: real investors risk their own money, the money they saved over their entire life making decisions.
Except for the "institutional investors".
Even then, the people the money came from voluntarily chose those institutions. If you don't like risky investments, there are lower risk institutions or products you can put your money in. It's still ultimately the will of the individual what they do with their money, and the consequences of bad choices are still mostly contained to the individuals who make them. But when it's done with tax money, everyone's dragged into it and has no personal choice in the matter. Even worse, when it's tax money without democracy, even if the majority of people don't like how it's used, they even collectively have no choice in the matter.
Here's a link to the full interview Bezos had yesterday
https://www.youtube.com/watch?v=E0x3UZDKSNo
https://www.billjaneway.com/productive-bubbles this is a good essay on this topic
The big question is what "society" he is talking about? Is it the "society" that includes all people, or the "society" that includes only rich people?
It will benefit all people but it will disproportionally benefit more rich people.
> It will benefit all people but it will disproportionally benefit more rich people.
Yes: you'll be homeless and living under a bridge, but you'll have an LLM therapist on your phone to console you. That's a benefit!
No they don't want that, because it could lead to an uprising against them. They want us provided with the essentials in exchange for being dutiful workers, so we have something to lose.
Everyone should live in pods stacked together, eat insects, not drive our own automobiles around or fly places, we should be able to get our entertainment and everything to keep ourselves happy from their subscription entertainment services. Basically we are to consume as little as possible to barely keep ourselves alive and sane while they sail themselves around to pat one another on the backs at their climate and economic conferences on their billion dollar luxury yachts.
Actually no that would be stupid they don't have the time or patience to sail their yachts around. They have crew for that. They will fly in one of their handful of private jets and have the yacht meet them there.
I'd actually love to eat insects but to my dismay I found out they're actually really expensive...
Just go outside for a while with a survival book if you are into it.
Soylent green will be affordable when the baby boomers start passing.
don't forget the dismantling of the local community and family identity to make people reliant on the government preventing resistance by division.
People do this to themselves and willingly, no spooky evil capitalists behind the curtains are necessary.
People love money and what they can bring on the table, people often hate each other ie within families stiffed by peer pressure and expectations of mentalities formed in another very different era, people love discovering new countries and cultures. And so on and on.
Ie me - I love my parents, my childhood was normal, only later to find and compare with others to see how such childhood was... abnormally uncommon. But I very much prefer seeing them few times a year only, even though we love when they help with kids. Some of their opinions are very outdated, their ramblings are often out of touch with reality, they tend sometimes to spoil kids (even after setting boundaries), and overall generational gap is absolutely massive. It is a form of freedom. Make that 10x more in much more strict societies where pressure and expectations from parents on kids are massive and then they wonder why kids stay the heck away from them once adults.
And fuck local communities, for every good-hearted neighbor who just wants to socialize and help out and otherwise stays away from one's life, there is easily 5 or 10 who are the epitome of nimbyism, voyeurism or similar hobbies of people with empty lives, clueless on how world and people actually work but always with very strong opinions on everything and will to push those on everybody else.
the last bit is only true under individualised consumerism. its when everybody is like a spoiled child is where solidarity goes to die.
But kids in those strict societies stay with parents more, help them and treat them better.
Meanwhile, you dont care about them except for them being potential resource of free work.
And I mean, you idea of local comunity is all about other people doing free work for you and then tolerating your peculiarities with no reciprocation.
So, I dont think that is much of an argument here.
> And I mean, you idea of local comunity is all about other people doing free work for you and then tolerating your peculiarities with no reciprocation.
When it seems to you like everyone around you is the problem, you may actually be the problem.
Maybe I phrased wrongly (not a native speaker) but what you say is incorrect. I am not free coasting on parents, in contrary my first years all my earning went into providing them a good home for rest of their lives, while living in tiny rental rooms. You have no idea from sort of poor background I come from, most western kids have no clue. It was a massive improvement of QoL for them that they would never be able to afford themselves and they still appreciate it massively. Since we live 1500km from them they help with kids literally few hours per year, not a burden for anybody involved.
But freedom to chose with whom we spend our time is a thing, no matter how much people like you try to force their righteous values that are the only proper true way (TM) on everybody else. I am old enough and over time met plenty of folks like that, be it religious or other forms, they are at the end the same as your comment.
At that stage, owners will very likely have enough drones and robots at their command to not need to worry about petty things like flesh and blood uprisings.
How will they steal added value and get richer if masses consume as little as possible?
All the value will be diverted. I don’t know if you noticed, but in the last few years, you’d have come ahead if you gambled on the stock, crypto or commodities market than if you busted your ass.
> Everyone should live in pods stacked together, eat insects, not drive our own automobiles around or fly places, we should be able to get our entertainment and everything to keep ourselves happy from their subscription entertainment services.
Yes of course capitalists love when economy is bad. Sorry, these dystopic visions do not pass even simplest smell test.
It’s less complicated than that. Externalities are when an individual profits but others pay the price. Think of climate change. And when a small number are so rich they control the government, so there’s nothing to stop them. It’s narrow incentives driving the whole thing.
They love it when the richest people do well. They dont care about how anyone else lives. The poorer other people are better they feel about winning.
Those you call "capitalists" love monopolies as long as they are theirs. They love captured market. They dont care about competition unless it is someone not them competing to provide for them on lower price.
As of now, billionaires dont want or need strong economy as a "middle class and lower class doing good". They want the "our wealth goes up, we are getting tax breaks, if lower class pays for it cool" kind of economy.
The poorer people are that are still able to work, the cheaper labor is. It's really that simple.
That would be https://marshallbrain.com/manna
It can even help you learn to tie a noose.
https://duckduckgo.com/?q=chatbot+suicide
14-year-old Sewell Setzer III https://apnews.com/article/chatbot-ai-lawsuit-suicide-teen-a...
16-year-old Adam Raine https://www.npr.org/sections/shots-health-news/2025/09/19/nx...
Doubtful. More likely that there will be robocops to stop you from loitering in the scenic places.
For sure, but most bridges aren't in scenic places and robocops will still be limited in numbers, so no worries, just ask your LLM assistance in case of doubt under which bridge you won't get evicted from. Altough, that would probably be illegal advice, but they can try to help you with therapy should you end up in such a situation. Not the top model of course, but hey, it is a benefit.
>robocops will still be limited in numbers
The population of developed countries is already at least 75% robocops
Erm, what qualifies as a robocop to you?
Every strata of society has been getting richer and richer along with technological progress. What makes you think that would change now?
For just $19.99/mo no doubt.
And covered by universal basic income.
Not necessarily. The benefits may barely trickle down, and the conditions for the majority could degrade overall.
Based on what evidence? The last few times this happened the whole world benefitted.
Based on extensive academic research on trickle-down economics, in particular looking into the evolution of real wages of different sectors of population, since 1980s.
See the work of recent Nobel prize laureates in economics. Many argue for redistribution and investment back to the society.
But the past few revolutions benefitted everyone and we are better off. Look at industrial revolution, digital revolution. Why do you think it is different this time? If trickle down economics don't work, why is world poverty at all time low and consumption at all time high?
> Look at industrial revolution
I really don't see how one can separate the industrial revolution from colonialism, considering we have chiefs of government in colonial countries on the record saying that colonies are a necessary outlet for industrial goods [1].
Once you've established that link, it's hard to explain that "everyone" benefitted from the industrial revolution.
Even disregarding that, the working conditions created by industrialization allowed for situations that can hardly be described as "beneficial" [2][3][4].
> digital revolution.
[5] provided without comment.
---
[1]: for instance, Jules Ferry: https://www2.assemblee-nationale.fr/decouvrir-l-assemblee/hi...
[2]: https://en.wikipedia.org/wiki/Bisbee_Deportation
[3]: https://en.wikipedia.org/wiki/Ludlow_Massacre
[4]: https://en.wikipedia.org/wiki/Coal_Wars
[5]: https://en.wikipedia.org/wiki/PRISM
What percent of the population in places which experienced the industrial revolution would be better off if they time-travelled back 200 years? 1%? 0.2%?
> in places which experienced the industrial revolution
People experienced the industrial revolution everywhere.
I suspect, when you think "places which experienced the industrial revolution", you think about a small subset of areas where some development happened as a result of that, likely the areas where industrialists lived.
But you would also have to consider other places' experience of industrialization. For instance, Congo under EIC colonial rule did experience industrialization - it was the place where industrial amounts of rubber were harvested to allow for plants elsewhere to produce joints, pipes, motor belts, etc. It's not really hard to believe that, had Congo not experienced that, its citizen would almost certainly have been better off now.
Does Congo lack electricity, modern medicine, and air conditioning?
Places that luckily avoided colonialism haven’t improved a zilch.
> Places that luckily avoided colonialism haven’t improved a zilch
Thailand and China would like a word.
So would Liberia and Ethiopia.
As noted, this refers to Reagan policies and onward.
Even after Reagan's policies how do your points hold?
Because we are counting people's wealth in significant fractions of a trillion dollars and young people around the world cannot afford homes no more?
Prices of houses increased but others decreased. Life expectancy increased, consumption increased.
“Phones not homes.”
When have we ever had a push to full automation?
Yeah it’s a complicated picture and of course nobody knows, but it would be helpful to split “benefits” into things like;
- net benefits to the average person (considering drawbacks)
- overall relative benefits compared to income groups
- benefits in certain areas of society and topics
I think there’ll be some “benefits for all” in terms of things like medical advances and health technology. There will also be broader benefits to all in general areas but as a parent poster said it’ll benefit equity holders most and there might be some bad tradeoffs (like we’ll have access to much better information and entertainment but it may also affect the overall employment rate). It’s a very nuanced picture and it’s probably disingenuous of some tech leaders to say “we’ll all benefit) but some do believe that will be the future.
If be benefitting you mean displacing all reason to live, then yes, it will solve that problem I face. Now I will be certain.
What you mean is those with some form of ownership of the technology. If development eventually results in full automation, with the expense of production reduced to zero, money will be irrelevant.
Energy, raw materials, and logistics still remain. I don't think we'll ever get to a place where there isn't some input to a production process that is not infinite and free.
You don't see full automation with robotics as a possible outcome?
Theoretically possible? Maybe (but still an extremely slim chance).
Practically possible? No. People (and countries) own land. Raw materials for robots comes from land. Energy for robots consumes land. Farming food requires massive inputs beyond just the land and energy (but also needs those).
I don’t imagine we’ll get to a world where my great-great-great^20-grandkids can hold out their hand and have a plate of steak and potatoes (or the then-equivalent) placed into it for free, anytime they want.
The expense of production and on-demand delivery of just a simple plate of steak and baked potato will not ever get to zero. If we can’t even get that simple of thing for free, I don’t believe in a world without the notion of money.
Expand that to even better dining, vacation, and leisure/recreational activities and I think the argument becomes even more solid that some form of rationing/limiting will be in effect and there will be a unit/notation of ration and trade that will be indistinguishable from money.
'Not ever' is a broad statement. Would you rule out off-planet mining and manufacturing? Or the scaling of artificial meat production?
I don't. If you do, maybe you could hypothesize a practically possible path from now to then and enlighten us Luddites?
The overwhelmingly most likely "end of money for humans" comes from the extinction of humans.
Believe me, ruling them out is the last thing I'd do. I fully expect them in the next decade or two.
A practically possible path to both: Starship is perfected and mining companies begin operations in space. Vast data centers training spatial ai using virtual simulations perfect it well enough for general robotics to become practicable. Automation is then as follows: robotics manufacturing and maintenance is handled by robots. Mining is performed by robots. General manufacturing performed by robots. Potential manufacturing scales increase by orders of magnitudes. Where are the costs in this scenario that would prevent prices falling to zero? And if prices for all goods and virtually all services* fall to zero, what possible role can money have at that point, other than sitting on a shelf as a memento of a vanished system?
*excluding sex workers.
The cost is in transportation (aside from the cost of developing and producing all those automated systems). Where do you expect extra-terrestrial mining to occur and why do you think what's mined there would be used on Earth? The nearest place to mine would be the moon, and it's on the order of 1 million dollars per kg to bring things back. We could potentially drop that, but that's a hell of a base cost just for material transport. What makes you think that's going to be happening soon?
In the next couple of decades? Starship is real, space mining companies are real, NVIDIA Cosmos is real, robotics development is nascent, but real and thrilling. Ordinary market forces will ensure the uptake of robotics.
You're calculating the expense of returning mined resources using past metrics that are superseded altogether in this scenario. For instance miniaturization suddenly won't be necessary for mining companies wishing to send gear to asteroids.
Why would off-planet mining and manufacturing make things easier?
> It will benefit all people but it will disproportionally benefit more rich people
The rich already have a diminishing returns situation with money. Everyone else has much more upswing.
The wealth gap widening is quite independent from AI being involved. A natural progression which was always happening and continues to be happening. Entil some sort of catastrophe reshuffles the cards. Usually a war or revolution. The poor simply rising up or a lazy and corrupt ruling class depriving their country of enough resources and will to defend itself that some outside power can take it.
Rich people will enjoy additional monetary benefits, but everyone will still enjoy the same standard benefits.
It will not benefit the rich as disproportionately as the covid pandemic did.
I can’t speak for others countries but here in the UK special “VIP lanes” were used to steal billions using fraudulent PPE contracts.
I’m not just talking about Baroness Mone either. PPE Medpro was the tip of the iceberg.
And we're not talking a 51-49 disproportion, we're talking about a 99.9999 percent of the benefit will go to the richest people
Cite?
The entirety of human history.
How so?
Thought experiment - Startrek replicators are real.
This basically means almost everything can be built without human involvement. The guy who owns the replicators is the richest.
The wealth gap is so massive you get revolts (because we're educated, not serfs, right?) So then government needs to step in. Either tax->ubi?, socialize it, or make it a state asset?
Regardless, that's the goal of AGI/robotics/etc.
If you can make many replicators, money stops making much sense. You probably end up with energy (if these devices take a lot of energy to operate) as the new currency.
My gut says that _somehow_ the middle class will get screwed as always, but I struggle to articulate the way that abundant cheap goods lead to that outcome.
Maybe because the very few that control the replicators will be able to cut people they don’t like out of partaking from them? That’d make some sense.
If replicators were replicatable, that control evaporates quickly. Remember how nervous we all were about LLM censorship, then suddenly a $2000 MacBook Pro could run pretty great open source models that seem a few months behind SOTA?
> If you can make many replicators, money stops making much sense.
There are many, many, many, many positional goods. Beachfront properties, original art, historical artifacts, elite clubs, limited edition luxury goods, top restaurants, etc.
The notion that we'd all live happily and contentedly without money if only we had some more iPhones and other goods produced by replicators strikes me as false.
Remember that Keynes predicted about a century ago that 100 years thence (in other words, now) everyone would just work 10 hours a week at most, and the biggest challenge would be to avoid boredom? He predicted productivity growth accurate enough, but assumed that people would have enough with 4x, 5x as much as they had back then while simultaneously working 4x, 5x less. Instead, people opted to work just as much and consume 16x as much.
IMO - Money will NEVER stops making sense.
Money is a cheap way to translate unlike objects. Cows to art, labor to goods. Green to triangle.
Money (or something) will always exist, because it is a needed lubricant for transactions.
In a word: it's fungible[0].
[0] https://en.wikipedia.org/wiki/Fungibility
> Money (or something) will always exist, because it is a needed lubricant for transactions.
So it's only useful for as long as you have the need for transactions.
> So it's only useful for as long as you have the need for transactions
Which you will always have some need for, because resources aren't infinite, real estate isn't infinite, services aren't infinite, etc
What does it mean in practice to have energy instead of money as currency?
People would still want to be able to trade with lower friction than lugging batteries around, so don't you just re-invent money on top of it? orrrrrr just keep having the current money around the whole time?
--
The general limiting factor with the "one person controls the replicators, only they have income" idea is that they would rapidly lose that income because nobody else would have anything to trade them anymore. (If you toss in the AI/robotic dream scenario, they don't even need humans to manage the raw material.) But then does that turn into famine and mass-die-off, or Star Trek utopia?
> What does it mean in practice to have energy instead of money as currency?
Something like Bitcoin. When the progress in miners efficiency stalls any kWh of energy not used for something else will be used to make some amount of bitcoins. If you have energy you can make btc. If you have btc you can give your btc to someone in exchange for their energy so that they give you their energy, instead of using it to mine bitcoins themselves.
That just seems very wasteful when proof-of-stake works.
Or even good old centralised distributed systems that do it another 4 to 6 orders of magnitude more efficiently than PoS.
> But then does that turn into famine and mass-die-off
Probably extremely bloody revolt and collapse
Only if you assume people's major motivation is wanting what they don't have, as opposed to wanting a little more to survive. History shows the opposite.
> History shows the opposite.
I strongly disagree, everything I know about history points the other way
Human history is littered with "people's major motivation is wanting what they don't have"
Look at the conflicts happening right now in Ukraine, or Israel
Come on, be serious
Seems analogous to LLM's: replicators replicate but do not create. Information would then seem to the proper choice for a new currency..
> If you can make many replicators, money stops making much sense. You probably end up with energy (if these devices take a lot of energy to operate) as the new currency.
If you can make many replicators, you certainly won't be providing them to anyone else. You'd be using them to ensure that money starts funneling into your revenue stream, and use that as a cash cow to pursue other projects.
That’s only a temporary possibility, once the tech gets out everyone will have replicators.
What are they replicating? Patented things, copyrighted things? Or groceries? Do they want to replicate things? In Star Trek, they travel light, wear uniforms, and have few personal possessions, because they're on a ship, in the navy. That's why everything has to be digital and everybody stuffs their life inside a phonecorder and drinks synthale. When he's back on earth, Picard has a horse. I could be wrong but I don't think he replicated it.
Just like everyone owns factories today
But energy is essentially free also, at least on the margin, and if we're talking about sunlight.
Sure. And AI will only run at peak solar times.
Did you know, that there is always a place on earth enjoying peak solar time right now?
> Remember how nervous we all were about LLM censorship
You're taking the wrong lesson from that observation. Models that people actually use are just as censored now as they ever were. What changed was the the hysterical anti-censorship babies realized that it's not that big of a problem, at least acutely.
> I struggle to articulate the way that abundant cheap goods lead to that outcome.
It has nothing to do with how cheap the goods are
The problem is that at some point people won't be able to afford literally anything because all, and I mean literally all, of the wealth will be hyper concentrated in a super small percentage of the population
Do you have anything to support this hypothesis?
https://delong.typepad.com/plutonomy-1.pdf
Link's broken.
https://web.archive.org/web/20250126183923/https://delong.ty...
This should work
Simple hypothesis. Top 5percent of US wealth now belongs to top 50 richest American. Even if you ignore corruption, lobbying and any ill intent you can definitely conclude that this top 50 individuals have better way of getting return from money than rest of the population. Even if if their delta of return is 5% we can assume that withing next 50 years there is a high probability that these guys will own 30-50% of wealth. I have a strong belive AI will acclerate that further.
But all your numbers (except maybe top 5% one) are completely made up. Strong beliefs don't prevent one from being completely wrong. Neville Chamberlain has a strong belief that he had ensured peace; Einstein had a strong belief that quantum theory's "spooky action at a distance" was incorrect. Both were wrong. Fifty years is a long time, and anything could happen. The last fifty years had the fall of Communism, the EU, China going from an impoverished countryside to a superpower, video phones in our pocket, social media upending communication and mental health, renewable energy displacing coal, Trump, etc.
Not to mention that 50% of US wealth is only 15% of the world's total wealth - a far cry from "literally all wealth"
But these aren’t replicators owned by a monopolist. There are a number of highly funded, highly competitive vendors at every level of the stack.
Sure, but you're not one of them.
Sure, but who do they sell stuff to if no one has a job? We’re on the brink of some _very_ unexplored branches of human behavior.
That's the key. The poor are useful to business so long as they are a source of money and power. What happens if the time comes that the poor have nothing the rich want?
The rich will need play things. Think Westworld, but with real people.
The poor will always have the only thing the rich want. Labor. Without labor Trump cannot slather the white house in gold. Without labor Zuck cannot smoke meats. Without labor Musk cannot troll people on X.
The rich do not want anything you have, they want you. Body and soul.
Robots can take most of the jobs, but the feeling of power over other humans they likely cannot replace.
> Robots can take most of the jobs
Not in our lifetimes and certainly not in our form of society. Robots will only drive down the price of labor. People will always be able to supply labor at costs below the price of materials for robots.
" People will always be able to supply labor at costs below the price of materials for robots."
Why? What critical materials do robots need that will always be more expansive than raising a human?
Also, from the point of "the rich" - the benefit of a robot is, that it will (stupidly) do as command, unlike a human. They don't have a family they want to take care first.
Historically in this case eventually the poor kill the rich
Probably not this time though
If they killed the poor, then how can they enjoy their power over people?
They'll just make some more poor to kill.
It's strange that socialists seem more concerned with their material possessions than anyone else.
I guess that’s why Larry, Zuck and Thiel, et al want constant recording of the plebs, so that ‘citizens will be on their best behaviour’.
This time there will be no revolution but it will be televised. :P
I mean, eventually like 1 person is going to have more wealth than 60% of the nation combined. At that point, why even bother trying to earn customers or appeal to the lower half when you can instead curry favor with that 1 person.
Oh, the rich will be very happy wielding sadistic power over the poor
They will always want entertainment.
Whether it's gladiators or bum fights, the poor will ultimately be given a job. Robot wars was fun, but UFC has stayed.
This is why revolts happen.
If you scratch under the hood of UBI, it's a mechanism to keep revolutions at bay. The balance of tax the ultra wealthy vs giving people enough to "live comfortably" is always the job of governance.
> If you scratch under the hood of UBI, it's a mechanism to keep revolutions at bay.
It's also putting money in the hands of the consumers so the rich can compete between themselves at how much each can scoop back up.
Something like feeding animals in the forest to compete with your friends at who can hunt better.
When poor have nothing then you have to shift to taking money of the other rich, but they are clever, so it's easier to take a little bit from the hands of all rich equally, give that money to the poor and reduce the new problem to the old one, how to extract as much as you can from the poor.
The first sentence is definitely. But, UBI is a nerd/socialist fantasy. It would nevet work and will never happen. Everyone with these sci-fi fever dreams of what will happen if AI collapses white collar jobs are coming from people that don’t know how the world or people actually work outside of their daydreams. People aren’t going to just be like “ok, well I guess it’s time for bread and water and Soviet style tenement housing, all this progress in livings was great while it lasted.” And other people are talking about using batteries for money or something. People need to touch grass.
This is very explored - it was the state of humanity for most of its existence. The few had resources, the many were poor.
For most of humanity's existence nobody was poor because there was no such thing as money.
Bots. Agentic consumers.
We're nearly-there. The humans then become the capital/resource to be acquired, not money.
That's why every country is somehow chasing that elusive "population growth". It creates more "things" to own, whether that be money by virtue of more people creating more money through economic activity or simply more people to claim as "yours" (for the elites/leaders).
Imagine a few billionaires pay big bucks to keep AGI to themselves and let the rest of us die on the vine.
Okay, but why would we die on the vine? Wouldn’t we just… make a parallel economy without the AGI? The world works today without AGI.
Or use any of the wonders of military technology invented in the last 200 years to take back society. These fuckers have lived in prosperity for so long that they don't even think it is possible. But so many people throughout history thought they were untouchable until the masses decided they had enough of their shit. Kings with professional armies, full plate knights, men with cannons, mens with guns, machine guns, bombs, planes, tanks, helicopters, and yet at the end of the day when enough random people are pissed off enough the mass of people with nothing to lose are the ones who "win" in the end with the powerful dead or hiding.
When unrest happens the military sides with the ones that give better hopes of keeping the stream of money that funds the army flowing.
It sides with the poor only if the powerful (gov) are hopelessly inept at gathering money. If there's a chance that current civilian power can reform and keep collecting the money from the people and funding the army then the army sides with them and help quell the rebellion.
Those who hold kinetic power will never side with poor against the rich.
Not always .. see the peasants revolt of 1381, French Revolution in 1789-1793, Bolshevik Revolution in 1917, etc.
Parallel economies are banned. Try making a new currency in the US.
Economies can work without currencies. It's a little inconvenient, but bartering/trading goods for services was common in the depression when nobody had any cash.
Interestingly, new ad-hoc currencies pop up all over in times like that:
https://www.armstrongeconomics.com/history/europes-economic-...
https://collectingpapermoney.spmc.org/wiki/Scrip_Issued_duri...
Printing money is lucrative for the printer so any time it might get even a little bit useful and feasible for other parties somebody will start printing.
Did we just ignore the last fifteen years of crypto?
No I had the speculative ponzi front of mind when making that comment.
Governments love crypto because it lets you seize lots of money from criminals across borders. And it is legal gambling where you can tax the winnings without reimbursing the losers (unless they can offset it but most probably can not)
> Okay, but why would we die on the vine? Wouldn’t we just… make a parallel economy without the AGI? The world works today without AGI.
Because you need things they want. Like why would they spare the electricity to heat your home, when it could go to "better" use powering a few dozen GPUs serving a billionaire? Why would they spare the land for you to grow food, when they could use it to build ziggurats dedicated to their power (or whatever else is their whim)?
The market sends the scarce resources to those with the most money.
What is the fantasy AGI supposed to be that's so great for billionaires to have? A human baby is an <s>A</s>GI, it won't tell you the Ultimate Answer, or even a penultimate one, because it has no way to know.
No, seriously, what? You think an AGI is going to be a willing slave and endowed with special knowledge? Where does either part of that come from?
> The wealth gap is so massive you get revolts
This never happens. It's not the relative wealth gap that creates revolts it's the poverty/bad conditions in absolute terms.
If the lower class conditions improve, even just a little bit, there is no revolt.
The world of Star Trek was fully post scarcity. Rich/poor were not things that existed.
They had to get through this before things got better: https://memory-alpha.fandom.com/wiki/Bell_Riots
Ultimately labour goes and works on something else instead. And the availability of free labour makes that possible. New industries and markets develop as a result. But a huge number of people will be left behind. But people will focus on things that were a lower priority before.
I have bad news for you, we've run out of sectors to pretend labor could be funneled towards. Manufacturing and agriculture are highly automated, service industry is full tf up, and nobody can afford more construction.
What about medical, elder care, fitness, leisure. Even service industries that focus on a more human connection. Or jobs focused on nature, the environment etc.
And i don't think this would nbe an easy process or something that could or would be managed. But it is probably already happening.
Yeah, but which tech has not had a homegrown variant that ultimately democratized it? Makes me think of the "feed" vs the "seed" in "The Diamond Age".
Continuing current trends presumably.
It is all society as long as they have access, and they do. Even if the big labs get more closed off, open source is right there and won’t die.
AI increases everyone’s knowledge and ultimately productivity. It’s on every person the learn to leverage it. The dynamics don’t need to change, we just move faster and smarter
> AI increases everyone’s knowledge and ultimately productivity. It’s on every person the learn to leverage it. The dynamics don’t need to change, we just move faster and smarter
This is incomplete in key ways: it only increases knowledge if people practice information literacy and validate AI claims, which we know is an unevenly-distributed skill. Similarly, by making it easier to create disinformation and pollute public sources of information, it can make people less knowledgeable at the same time they believe they are more informed. Neither of those problems are new, of course, but they’re moving from artisanal to industrial scale.
Another area where this is begging questions is around resource allocation. The best AI models and integrations cost money and the ability to leverage them requires you to have an opportunity to acquire skills and use them to make a living. The more successfully businesses are able to remove or deprofessionalize jobs, the smaller the pool will be of people who can afford to build skills, compete with those businesses, or contribute to open source software. Twenty years ago, professional translators made a modest white collar income; when AI ate those jobs, the workers didn’t “learn to leverage” AI, they had to find new jobs in different fields and anyone who didn’t have the financial reserves to do that might’ve ended up in a retail job questioning whether it’s even possible to re-enter the professional class. That’s great for people like Bezos until nobody can afford to buy things, but it’s worse for society since it accelerates the process of centralizing money and power.
Open source in particular seems likely to struggle here: with programmers facing financial downturns, fewer people have time to contribute and if AI is being trained on your code, you’re increasingly going to ask whether it’s in your best interests to literally train your replacement.
Which of those did the Internet benefit?
Is the average person actually better off after the late 90’s internet is probably a harder question than it might seem.
The long tail may be closer to what I want, but the quality is also generally lower. YouTube just doesn’t support a team of talented writers, Amazon is mostly filled with junk, etc.
Social media and gig work is a mixed bag. Junk e-mail etc may not be a big deal, but those kinds of downsides do erode the net benefit.
Are you being objective or just romanticizing the past?
Just to use your example: YouTube is filled with talented writers and storytellers, who would have never been able to share their content in the past. *And* the traditional media complex is richer than ever.
I don’t think average quality matters. Just what you want to consume.
If anything, I’d be more open to the opposite argument. Media is so much richer and more engaging that it actually makes our lives worse. The quality of the drugs is too high!
Media is so much richer and more engaging that it actually makes our lives worse. The quality of the drugs is too high!
I am not sure it's the quality, it's more that it's optimized for dopamine shots. Heroine is highly addictive, but I think that few people would argue it's a quality drug.
Recently there was a TV item that was filmed (in NL) just before the broad adoption of mobile phones (not smartphones). People looked so much more relaxed and more oriented towards others. I am happy that until my 18th or so mobile phones were not really a thing and that smartphones were not a really a thing until I was 25-27. I was an early adopter of smartphones, but I don't think we realized how addictive and destructive social media + smartphones would become.
The early internet was very cool though. Lots of info to be found. A high percentage of users had their own web page. A lot of it was pretty whacky/playful. Addictive timelines etc. had not been invented yet.
Does the answer to "is the average person better off" have a lot to do with "how many TV shows are out there"...
or does it have to do with:
- how often their boss bugs them after hours
- how much their boss uses technology to keep an eye on them, their friends, their political views
- how often random strangers might get mad at them and SWAT them, make false claims to their employers, etc
- how often their neighbors are radicalized into shooting up a school
- how hard they find it to talk to a real person to resolve an issue with a company or government service vs being stuck on hold because of downsizing real support staff relative to population size, or with an ai chatbot?
etc?
How about “how often a sibling dies because the local medical people don’t have access to all of the world’s medical information instantly”.
Most of the world is not rich people getting swatted by teenagers they’re playing call of duty with.
I was trying to be objective which is why I didn’t try to compare individual shows.
Thus average production quality seems like a useful metric. There’s currently a handful of “traditional media/streaming” shows with absolutely crazy budgets today and if you happen to like them then that’s great. However, if you don’t things quickly fall off a cliff in terms of production quality.
The same is true of YouTube. The quality of 50,000 one man operations is irrelevant if you happen to like MrBeast, but if you don’t like MrBeast budgets drop off fast. A reasonable argument is you and everyone else may prefer a specific YouTube cooking show over Baking with Julia or other 90’s show with a much her budget, but there where several options to chose from.
Thus purely objectively even if 90’s TV had lower maximum budgets the floor being relatively high is worth taking into consideration.
It's worth noting that due to advances in technology, it is possible to deliver the same show for less money and time.
The average "how to cook on a food network" show was, ultimately, one person in the kitchen of a large home cooking for the camera, produced once a week. There are plenty of people delivering that style of cooking show with high production quality today. Obviously it's not the same because some things are less deliverable with smaller or one-person teams (Miss Piggy is not going to visit some Youtube show the way she visited Martha Stewart) but there are people making this content ranging from big shops like NYT Cooking to smaller outfits like Binging with Babish, Glen and Friends Cooking, etc. and there are even outfits like this dedicated to more niche topics like Tasting History or Emmymade.
A wide range of things have gotten dramatically cheaper, but that only goes so far.
Many YouTube channels make great use of Zoom calls for example. It’s still generally a compromise vs an actual face to face conversation.
Safety is another real concern. People have died doing stuff solo that wouldn’t have been particularly dangerous with minimal supervision.
I’m also a fan of Tasting History. Highly recommended.
> it is possible to deliver the same show for less money and time
Do we, though?
I recently learned about the controversial scene "Baby, It's Cold Outside".
Ignoring the content of the scene for a moment, the quality of the choreography stood out to me as something you would never see in a movie today. Certainly not in one take.
It's really not though. There are a few high quality individual creators, but not many.
You could afford a house in 90s, with a 9-5 job. Today, you would see housing crisis in major metros.
Media is rich but not in proportion of the thousands of new creators doing very well. An extreme example is playboy vs only fans creators
show business and things like it are famously pyramidal in shape. there are decades' worth of people who couldn't make it in previous generations in Los Angeles and New York.
i think what is relatively new is the unaffordability crisis making it so doing such pursuits and not being that successful is no longer a way to make a living on its own.
I wish this argument would die. We're asking for a better future among futures, not a better future compared to the past.
It's like buying a car, receiving a bike, and then being told, "A bike is great because you don't have to walk anymore." If you feel like that's unfair and the response misses the point, that's how that lands. I don't know who, when hearing that, feels better. It feels out of touch and dismissive.
Youtube has some marginal value, but I'm not sure "storytellers" bring a materially positive impact (and I reject the "richer" aspect outright). We had libraries in the 90s and they didn't force you to watch ads.
The political instability that came with social media isn't great, either.
I question this narrative. While social media is certainly having a negative impact, most democratic societies have relatively short life spans historically speaking. There’s also a tendency for economies to falter, for irrationality to increase, for birth rates to drop, and so on. It would seem that the same trends (roughly) occur in every democracy as it starts to fail.
Yes. The meta problem is the trend toward “I dont’t like X, and I don’t like Y, therefore X is causing Y” thinking.
It’s always been the reactionary’s argument: immigrants cause crime, inter-racial marriage causes poverty, etc, etc.
The real collapse we’re seeing is the liberal / progressive adoption of these fallacies. Social media causes fascism (nevermind the absence of social media in previous collapses into fascism), etc.
Many of the people rightfully dismayed by trends are unwittingly contributing to the changes they dislike.
The correct answer to “I think social media leads to fascism” is not “let’s ban social media”. The correct answer is “let’s study the problem and see what science says”. Abandoning that is giving up.
I think in the near term social media can actually have a stabilising effect just because of how much it paralyzes people. It takes emotion and redirects it into something with little real world effect. Whilst most actual power is exercised offline. This sometimes breaks down and the crazy escapes from the internet and reeks havoc. But mostly the geriatrics are left alone to pull the levers of power in relative peace.
Ah yes. The popular ~14000 year stable period disrupted by social media.
Expand the thinking to include impact on developing countries, the poor, minority groups who have few people like themselves in their local area, etc.
I’ll grant that for comparatively wealthy, privileged people who were always going to have an easy time (which frankly include me), the internet has been a mixed bag.
But for the kids growing up in comparatively poor countries, who can now access all of the world’s information, entertainment, and economy.. I think it’s a pretty clear win.
I expect AI will be similar: perhaps not a huge boon to the best off, but a substantial improvement for most people in the world. Even if we can sit back and say “oh, but they also get misinformation and lower quality YouTube content”
Undeniably better off in every single way. Minimum is that the price of long distance phone calls is now zero, let alone video calls. Being able to speak to family and see them nonstop is incredible.
I’m glad I can call my parents to ask them for money for groceries after I was laid off
And yet, when we are with family and friends, we’re on the damn phone!
Do people actually visit family in-person at least less often? And to the degree they augment rare family in-person visits with a lot of phone calls and/or video calls.
I can believe a lot of friend get togethers IRL have been replaced with video calls. There's a tradeoff. I have a group of older friends and we still get together in-person but Zoom calls are a nice adder.
I'm in a few organizations where we also find Zoom a nice alternative to people schlepping somewhere for an hour meeting that mostly works as well online--and we still have a few physical get-togethers over the course of the year.
Young people are forced to move to wherever job opportunities are due to how hyper optimized the economy has become, so I would say most people spend way less time with family than 30 years ago
It's complicated and you can look at a lot of studies. People have always moved where opportunities existed--including across oceans pre-aircraft. Yes, when there were company towns, people moved less.
Why are people much less happy then?
https://news.gallup.com/poll/505745/depression-rates-reach-n...
More precisely, Americans are more diagnosed with depression. In the five years prior to COVID it's shown as rising by 3.3 percentage points. Is that surprising? The trend isn't likely to be flat. Also, is this happiness? Also, does a graph starting in 2015 relate to the question about the 90s? Also, do you expect happiness to be driven by having new things, or for people to adjust their expectations and remain constantly unhappy? Isn't disruption the main cause of unhappiness?
I wonder what event started in 2020 that might have caused major social and economic disruption, and could have had that effect. Maybe something that drastically limited peoples social mobility and lead to mass isolation.
The trend goes back way further than 2020
Because they have lost the ability to distinguish correlation from causation?
Would you rather be a 22 year old starting in life in 2025 or 1995? Unless you pick one of the few countries that underwent a drastic change of regime in that time, the answer’s pretty clear to me.
Ib the US, 1995 by far!!!
Given my skillset at age 22? Yeah, I'll take 1995. I was old enough to grow up hearing how great the world was going to be if I learned computer programming just to enter the job force at the start of the dotcom bubble burst. 1995 would have been a major upgrade.
Also, knocking that almost decade off my birthday would assure that I spent most of my adult life with the luxury of thinking that energy didn't have negative externalities that were being forced on later generations.
We had Chomsky-esq "any major world power is kind of fascist if you think about it" instead of literal talk by politicians about putting people in camps if they don't like your diet or country of origin.
TV was pretty bad I guess but music was great and I read more back then.
There was a lot of huffing and puffing about gang violence. I grew up on the street the local gang named themselves after and it only marginally touched my life at all.
Housing was dirt cheap, food was dirt cheap, gas was dirt cheap. There was undeveloped land everywhere around the city I live in and it gave a general sense of potential.
What exactly was so bad about the 90's?
Yes, the US was in a particularly prosperous and exciting period compared to much of the rest of the world in 1995. If you’re, say, Chinese, chances are you find life in 2025 much more appealing
Overall, life is better in 2025 for the vast majority of humans. Life expectancy, child mortality, health (despite the obesity epidemic, which is a result of an abundance that has eliminated hunger and food insecurity from large swathes of the globe), purchasing power, access to technology and entertainment, etc, etc…
That some people in the US are feeling disillusioned because housing has become more unaffordable (partly because of regulations and technological advancements that have improved their quality and safety) and that they don’t have the same incredible economic trajectory as the preceding generations, especially since WWII, doesn’t negate that. A run like that can’t last forever, especially since it to a large extent depends on having a relative advantage over the rest of the world - at some point, they’ll start to catch up
Much of the same dynamics apply to Europe, too
1995 (and I was 22 in 1995)
Is AI at the same level of global instant comunication and gigabites of bandwidth?
Does it have to be for the analogy to work?
Probably. The the internet was more clear cut. Moores law all the things. Governments investing in pipe etc.
AI harder to tell. Will 2026 models kick 2025 ass or just be slightly better. Who knows.
Manna ponders the same question. I don't think we're headed towards the "good" ending.
https://marshallbrain.com/manna1
What an incredible read - thanks for the share
Once upon a time, society was all of us, but Society were the filks that held coming out parties and gossiped about whose J-class yacht was likely to defend the America's cup.
Society with a capital S are the beneficiaries of the bubble.
Bezos didn't define "society", but knowing Devil is what Devil does, we can infer:
1. Amazon files the most petitions for H1-B work visas after Indian IT shops. 2. Amazon opposed minimum wage increase to $15/hr until 2018! 3. Amazon not only fires union organizers, it's claiming National Labor Relations Board is unconstitutional!
What value does your question add, if it wasn't Bezos saying this would you have the same question?
How are you defining rich, Billionaires? It's sad that your comment is the top post.
The fact that Bezos is saying this is precisely why the commenter is asking this. He clearly stands to benefit massively from the bubble. Statements like this are meant to encourage buy-in from others to maximize his exit. Presumably "rich" refers to those, like Bezos, who already have incredibly disproportionate wealth and power compared to the majority of people in the US. I'm honestly not sure what the thrust of your comment even is.
Counter prediction. AI is going to reduce the (relative) wealth of the tech companies.
AWS and Facebook have extremely low running costs per VPS or Ad sold. That IMO is one of the major reasons tech has received its enormously high valuation.
There is nuance to that, but average investors are dumb and don't care.
Add in a relatively high fixed-cost commodity into the accounting, and intuitively the pitch of "global market domination at ever lower costs" will be a much harder sell. Especially if there is a bubble pop that hurts them.
History would indicate that if the you make a bubble big enough and then it pops, you don't have to clean up the mess. 2008 wasn't that long ago.
I don't understand this argument. Speaking as a kid who grew up middle-class as an 80's teen obsessed with (the then still new) computers, a non-rich person has access to more salient power today than ever in history, and largely for no or low cost. There are free AI's available that can diagnose illnesses for people in remote areas, non-Western nations, etc. and which can translate (and/or summarize) anything to anything with high quality. Etc. etc. AI will help anyone with an idea execute on it.
The only thing you have to worry about are not non-rich people, but people without any motivation. The difference of course is that the framing you're using makes it easy to blame "The System", while a motivation-based framing at least leaves people somewhat responsible.
Wealth may get you a seat closer to the table, but everyone is already invited into the room.
The problem is if the system leads to demotivating people more than motivating them on average, which risks a negative feedback loop where people demotivate each other further and so on
Yes, just read reddit or this thread.
I'd love to see the people's lives saying how bad it is now. My guess is they have every luxury afforded to them. There is strong negativity bias.
This is a simplistic, individualistic view of the impact of AI.
You’re imagining the world we have today, but with AI.
In reality it’ll be a world that’s completely different, and most likely in a worse way, and AI is the tool used to make it worse.
You have an incorrect reading of history and economy. Basically none of the wealth and comfort we (regular people) enjoy were "gifted" or "left over" willingly by the owner class. Everything had to be fought for: minimum wage, reasonable weekly hours, safe workplaces, child labor, retirement, healthcare...
Now, ask yourself, what happens when workers lose the only leverage they have against the owner class: their labor? A capitalist economy can only function if workers are able to sell their labor for wages to the owner class, creating a sort of equilibrium between capital and work.
Once AI is able to replace a significant part of workers, 99% of humans on Earth become redundant in the eyes of the owner class, and even a threat to their future prosperity. And they own everything, the police and army included.
“Free ai” lol
That's a very relevant question. And as your question implies, we all know which society the billionaires talk about. But AI is just a technology like any other. It does have the potential to bring great benefits to humanity if developed with that intent. It's the corruptive influence of the billionaire and autocrat greed that turns all technologies against us.
When I say benefits to humanity, I don't mean the AI slop, deepfakes and laziness enabler that we have today. There are niche applications of AI that already show great potential. Like developing new medicines to devising new treatments for dangerous diseases, solving long standing mathematical problems, creating new physics theories. And who knows? Perhaps even create viable solutions for the climate crisis that we are in. They don't receive as much attention as they deserve, because that's not where the profit lies in AI. Solving real problems require us to forgo profits in the short term. That's why we can't leave this completely up to the billionaires. They will just use it to transfer even more wealth from the poor and middle classes to themselves.
I have a phd in mathematics and I assure you I am not happy that AI is going to make doing mathematics a waste of time. Go read Gower's essay on it from the 90s. He is spot on.
What are the actual benefits? Where are all these medicines that humans couldn’t develop on their own? Have we not been able to develop medicine? What theorems are meaningful and impactful that humans can’t prove without AI? I don’t know what a solution to the climate crisis is but what would it even say that humans wouldn’t have realistically thought of?
You're most likely correct in thinking 'we would get there eventually'. But in the case of medicine, would you like to make that case to those who don't have the time to wait for 'eventually' - or who'll spend their lives in misery?
It's a matter of prompt engineering, you have to be a really good engineer to pick the correct words in order to get the cure for cancer from ChatGPT, or the actual crabby patty recipe
;)
When billionaires talk about “benefits”, I’m getting very suspicious.
Cheaper cloud costs
Business. People in the human centipede who wont fight fascism
ChatGPT currently has
~ 120 to 190 million daily active users
~ 800 million weekly active users
~ 450 million to over 800 million depending on the data source and methodology.
Get a grip. Hundreds of millions of people are using it, most of them for free. I would say "society" has benefited.
This has to be peak HN.
Create the fastest growing consumer product in history.
HN anon: yes, but who will benefit?
Facebook has more. Was it a benefit? Does the benefit outweigh the harms?
Yes, Facebook is a benefit. Among other things, it gave me React which much of the modern web is built on, and React Native, PyTorch, GraphQL, Cassandra, Presto, and RocksDB just to name a few.
The question is, what are billions of people doing on Facebook if it's harmful? I don't know. My daycare sends me updates, my barbershop tells me when they're closing and I used it to sell my fridge.
This hole Facebook irrational hate is ridiculously overblown. It's an app, and compared to things like TikTok that is essentially a Chinese psy-op, it's really a great product.
> what are billions of people doing on Facebook if it's harmful? I don't know.
This is extremely naive and akin to asking "why do people drink if it’s bad for you then??" Popular != healthy
I think it's incredibly naive and arrogant to tell billions of people who use a product through their own free will "ackchyually its really bad and you should stop".
Almost everyone would give you a response similar to mine. They use it because its easy way to plan events since so many people are on it, or a small business can easily create a website, sell something or just kill some time on the can.
Give it a rest.
Tbh, it's not clear that if we all stopped drinking the world would be better.
Yeah, and maybe it would be better still if we all tried heroin!
Are you legitimately trying to compare alcohol to heroin?
I don’t want to spoil anything for you, but ethanol is actually a very reactive molecule — and in some ways, it acts similarly to opioids like heroin. It, among other things, stimulates endogenous opioid pathways, leading to the release of β-endorphins and activation of mu-opioid receptors. So, alcohol works indirectly, heroin directly – but both enhance opioid signalling. If you’re curious, this study explains it really well:
https://pmc.ncbi.nlm.nih.gov/articles/PMC3728478/
Food can also indirectly enhance opioid signaling. What's your point?
Food activates it within normal biological limits, alcohol and heroin artificially push the same system far beyond normal range, forcing the brain to compensate by downregulating receptors or reducing endogenous opioid production, so it's totally legit to compare alcohol to heroin
I think they are legitimately mocking the notion that we wouldn't all be better off without alcohol.
Oh it definitely would
Hard disagree.
>The question is, what are billions of people doing on Facebook if it's harmful?
Why do everyone get sick and eventually die if it's harmful?
It's amazing how much leftist discourse is just them pretending not to understand things, thus making discourse impossible.
> My daycare sends me updates, my barbershop tells me when they're closing and I used it to sell my fridge.
To consider the other side of this, read "The age of surveillance capitalism" by Shoshana Zuboff (really read it though, not chatgpt the summary :).
All the benefits you mentioned are real. But, at what cost and could we have reaped the same benefits without surrendering all agency to those who can't be held accountable?
What are the costs? Seems like a huge benefit to me considering the alternative would be... I don't know. No updates? Maybe some shitty custom app that would 100% for sure have worse data security and privacy rights than something like Facebook?
Everyone's talking vaguely about the costs but no one actually makes a concrete case, where I made a concrete case of the benefits.
>much of the modern web is built on,
Was modern web a benefit?
> The question is, what are billions of people doing on Facebook if it's harmful?
Perhaps _you_ don’t know.
It’s quite notorious for being the place to organise the genocide over in Myanmar.
IMO, that should disqualify every executive or engineer who knew (and did nothing) from ever again being involved with widely-used infrastructure.
It’s hard to believe this is not a rage bait AI comment given the last paragraph.
Both are terrible for society but I use facebook tools so Chinese app bad, USA app good i guess? Is that what you’re trying to say?
> Yes, Facebook is a benefit. Among other things, it gave me React
No, this is peak HN
Facebook and many of these other VC companies have worked by building a moat through network effects by burning money to build something free and awesome. Then once you HAVE the network effect then it becomes hard to leave. Your history is on there, people know you through it, your friends and family are there; are you really going to leave? That’s when Facebook starts turning the screws. Ads. Manipulative algorithms. Polarizating recommendation algorithms. Social isolation. Making deals with dictatorships. Censorship of the worst crimes humanity can commit against itself (genocide).
Why? They are making money through all of it. It’s called rent extraction. You OWN something valuable. You no longer have to produce something of value. You can just charge people money for what you own. Rent. It’s various forms of rent. Sucking out money and souls into it. One of countless ways we’re leeched on by these companies and their billionaire owners.
Do the benefits outweigh the harms? Facebook and the VC playbook is boiling a frog and we are the frog.
It’s fast because there already gobs of people on the internet because of all the other products that came before. Facebook didn’t grow as fast because there weren’t as many people on line then. Gmail didn’t grow as fast because there weren’t as many people online then.
I use it for free, and when it stops being free, I will stop using it.
Until costs of utilities, food, medical, insurance are dropped by technology, there are no societal gains, just loss of human jobs.
Society as a whole, or one percenters like him?
Bezos is a 0.0001-percenter. Most of people on HN are probably in the top 1% to 5%.
You're in the top 10% in the US if you make $170k/yr.
True. But that’s income, to be top 10% in your net worth you need 1.5m USD and 12m USD for top 1%
Yeah, but net worth is weird because for most people, it just measures age. When you're young, you have nothing in your 401k and you have a brand new mortgage, so you're worth around $0. Negative if you have any student loans.
When you're in your 50s or 60s, the mortgage is repaid, and if nothing blew up, you probably also have a million or two in your 401k, so at that point, it's actually not that hard for a person who had a decent career in the SF Bay Area to be worth $4M+. And many FAANG retirees will probably flirt with $10M+ if they don't spend too much.
Is that in the world? Or in the USA. Idk I thought there would be more millionaires.
Earning $60k/yr would put you in the global 1%.
are most people on HN making 170? I feel a bit less privileged now.
Entry-level total comp for SWEs in the SF Bay Area is probably $250k. A senior dev at a public tech company can easily clear $400k. Really senior engineers at FAANG routinely clear $1M.
I need to move back to the Bay
For senior engineers with some fiscal discipline, it's great, although it's more great to work remotely.
On the more junior end, that $250k goes about as far as $100k in a less expensive region. Keep in mind that the average 1-bedroom rent is $3k+/mo, the average home for a family with kids is $2M, the average PG&E bill for a house is probably $400+, any repairs or remodels will cost you 2x as much as in most other places... and state income taxes are 10% on top of federal.
Most CoL estimates put the cost of living in San Jose at 2x the national average. And that's San Jose.
it's possible to work remotely, albeit harder to land a job. Still if you makea bit less and live in a LCoL area that's a great deal.
And we aren't also in some other bubble. From rest of the world those compensation levels sound insane.
Midway through my career, these days I feel fortunate to be making 60k. But I'm in Canada.
It's extremely regional. I was at 160 after less than 5 years in the industry. In the Bay Area, that still put me in the bottom 10% for tech workers
https://www.levels.fyi/heatmap/
The massive economic productivity gains from AI will improve the lives of very few if some form of fair fiscal redistribution is not be put in place.
If you listen to the speech it's a bit more nuanced than that headline.
Do I have this right that there have been no or at least very few pure AI IPO's during this cycle (I can't actually think of a single one)? So it's dissimilar to dotcom in that regard because during that time countless dotcoms went public with sky-high valuations and then failed. A bunch of reputable companies also went or were already public during that time and those saw huge valuation drops so that's more analogous to what could happen in the public market (NVDA, for instance, could pull a Cisco and drop "catastrophically," but survive just fine).
That would cause a lot of pain for those shareholders, but would that be somewhat contained given the public "AI" companies for the most part have strong businesses outside of AI? Or are these market caps at this point so large for some of these AI public companies that anything that happens to them will cause some kind of contagion? And then the follow up is if the private AI companies collapse en masse is that market now also so big that it would cause contagion beyond venture capital and their investors (fully aware that pensions and the such are material investors in VC funds, but they're diversified so even though they'd see those losses maybe the broader market would keep them from taking major hits).
Not giving an opinion here, though my knee jerk is to think we're due for a massive drop, but I've literally been saying that for so long that I'm starting to (stupidly) think this time is different (which typically is when all hell breaks loose of course).
There aren't very many IPOs in general. There were about 8000 publicly traded companies in the US in Jan 2000. Today there are about 3950. A lot of the AI related IPOs have been the infra like CoreWeave and Nebius.
This time is always different, until it isn't.
However, it is different from the internet bubble partially for the reason you describe.
There have been a few IPOs, but they perhaps happened earlier in the cycle, or companies are pivoting into AI. I'm thinking companies like Palantir, which was always AI, or Salesforce which is making a big AI pivot.
Most of the funding is not coming from public sectors. There is so much private capital available that it isn't necessary. I believe the bubble is in VC, which some would think is find because it protects public markets from the crash, but I'm not sure that is correct.
When the VC money stops flowing into AI, I think it will send a shockwave through the public markets. The huge valuations of companies like OpenAI, Anthropic, etc will be repriced, which will probably force a re-pricing of public darlings like Palantir, Microsoft, NVIDIA.
If VC funds aren't buying NVIDIA chips and building data centers, everyone will feel the need to re-price.
It's emotional, not logical.
Historically, the worst busts following the bursting of an asset price bubble, in terms of real economic impact, have been from debt fueled bubbles (Great Depression, Global Financial Crisis). You can read Hyman Minsky and Irving Fisher for a detailed analysis of why, but it mainly comes down to the fact that the financial obligations remain once prices and expectations have reset.
Then you have the busts that follow public equity fueled bubbles (Dotcom crash). Nowhere near as bad as the former, but still a moderate impact on the economy due to the widely dispersed nature of the equity holdings and the resulting wealth effect.
What we have now is more of a narrowly held private equity bubble (acknowledging that there's still an impact through the SP500 given widespread index investing). If OpenAI, Anthropic, Perplexity, and a bunch of AI startups go bust, who loses money and what impact does it have on the rest of the economy?
How was Palantir always AI?
It may be true that OAI et al are raising money in private markets, but does that matter? Ultimately they are still just raising money. Ultimately returns need to show up. You cannot escape that. If you cannot do that nobody will eventually supply the funds to keep operating.
The big advantage of staying private is controlling the narrative.
Because the comment was specifically pointing out that this doesn't seem like a bubble because there aren't many IPOs or public pure play AI companies.
IPOs aren't what they once were. The burden of being a public company has increased (SOX and related public company costs are $5-10M/year), so companies are far more likely to stay private. That has created a positive feedback cycle as the private funding ecosystem has become increasingly robust, which is why you see so many $100B+ private companies.
Also keep in mind that the biggest companies during that bubble had peak market caps of ~500B and then lost ~90%, so 400-500B in losses each and total internet related losses of a couple trillion. If NVDA lost 90%, it would be down 4 trillion dollars, or twice that total just by itself.
AI company valuations collapsing would have meaningful impacts on the broader market. Big pension/mutual funds are important sources of capital across every sector, and if they're taking big losses on NVDA, GOOG, and a portfolio of privates, it will have a chilling effect on their other activity.
The costs are a weak argument. The more stronger argument for why they arent going public any time soon is that OAI in particular is a corporate governance nightmare, in which the way they transmit information about their firm and financials will have to completely change.
Theres also plenty of money washing around in private markets so no need to go public. Staying private is an advantage.
there is no way they could raise that much money from public markets.
Also, there s no need to invent new tech names anymore. Marketing can add "AI" to the company name, or (as they say), change the wording from "Loading..." to "Thinking.."
I'd love to see those "gigantic benefits". Currently, the only positive thing about LLMs I hear regularly is that it made people more productive. They don't get paid more (of course), they're just more productive.
more productivity at same cost = more stuff, cheaper
Soo where is that deflation? Bc from what I see all of that extra productivity is landing in the pockets of shareholders
Right, so not a bubble then
More productivity at same cost = More profit for companies.
Also, the cost of most of the stuff I (have to) buy (i.e. rent, groceries, ...) is not dominated by the wage of knowledge workers.
Or to put it differently: If AI makes me lose my job but doesn't decrease my rent, I'm in a really bad position.
> More profit for companies
Agreed. So I don't think it's a bubble.
Will also be good for consumers in the long-term: much faster pace of drug discovery and new tech generally.
> Agreed. So I don't think it's a bubble.
I'm not arguing it's a bubble. I'm arguing it's not going to be a "gigantic benefit" for society.
> Will also be good for consumers in the long-term: much faster pace of drug discovery and new tech generally.
Medicine and tech that knowledge workers won't be able to pay for without a job. I also don't think "new tech" is necessarily a good thing societally.
The calculus is easy, really: AI makes 100% of my income worth less but only decreases the cost of a fraction of my expenditures. AI is bad for anyone that works for a living. That's pretty much all of society except for the top x%.
I don't think I need email marketing spam or useless apps to be cheaper.
The hard trades and manual labor services we consume for everything that matters daily? That's not going to be made cheaper by AI.
*To sell, not to buy.
This lie is still being spread in economics classes?
No clue
It's very hard to find anything other than half saying AI is in a bubble, and we will pop any day now, and the other half declaring AGI by 2029, when a new revolution will begin. If you follow the hard science and not the money, you can see we're somewhere in-between these two takes. AI datacenters requiring new power plants is unsustainable for long-term growth. Meanwhile, we have LLMs accepting bullshit tasks and completing them. This is very hard to ignore.
> Meanwhile, we have LLMs accepting bullshit tasks and completing them.
Would you mind elaborating on that? I’m not quite sure what you mean.
People in the comments seem to have forgotten about, or never lived through, the dot com bubble. Amazon’s shares fell from $113 to $6 in 2000. So yes, the internet survived and some companies did well after, but a lot of people were hurt badly.
Gotta say I'm pessimistic about the future of AI. At least until its adopted by public sector, schools and societies. Right now its just enhancing what we already have. More "efficient" meetings with auto-note-taking so we can have more meetings. More productivity so we can make less people do more, increase the workload and make them burn out faster. Better and more sophisticated scammers. More sophisticated propaganda by various legal and illegal actors. Cheaper and more grotesque looking vidz and music. More software slop. Not to mention all the "cool" improvements coming our way in the form of smart rockets, bombs and drones and of course I drool for all the smart improvements in surveillance capitalism 2.0. They call it a revolution but for now its just a catalyst for more of all the things we "love".
I see that my Echos want me to enable the new Alexa. I confess a great deal of trepidation on these. Fairly confident that this is not going to go smoothly.
And again I'm baffled on how they would light such good will and functionality on fire.
Poor Jeff gonna miss that sweet AGI gravy
Yesterday, I asked an LLM to create a browser plugin and it got 98% correct in its first try.
Yesterday someone's uncle tried the same thing and now his bank account's drained because the 2% that wasn't working was the 2% that prevented his password store from being posted online.
See how that works? A few nerds think it's great while everyone else gets screwed by it.
How many people can recognize that 2% is wrong? Of those, how many can fix the 2% without introducing more errors?
This shouldn't be a surprise - capitalism always overshoots. Anything worth investing in will generally receive too much investment in because very few people can tell where the line is.
And that's what causes bubbles but at this point it should be clear that AI will make a substantial impact - at least as great as the internet, likely larger
As FB IPO’d at 100bn, and marched to over 1T, when would you have considered it a bubble? You can ask the LLM if you need to … catch my drift?
I'm not sure I see the point. The march to $1T took 10 years with available financial statements.
You made the point for me. That 100bn doubled every 2-3 years. It wasn’t a bubble, but it absolutely looked like one. This will be a bitter lesson too.
This seems obviously and trivially correct to me...
My understanding is that the cost of training each next model is very very large, and a half trained model is worthless.
Thus when it is realised that this investment cannot produce the necessary returns, there will simply be no next model. People will continue using the old models, but they will become more and more out of date, and less and less useful, until they are not much more than historical artifacts.
My point is that the threshold for continuing this process (new models) is very big (getting bigger each time?), so the 'pop' will be a step function to zero.
Why do you think the models will become out of date and less useful? Like, compared to what? What external factor makes the models less useful?
If it's just to catch up with newly discovered knowledge or information then that's not the model, they can just train again with an updated dataset and probably not need to train from scratch.
> What external factor makes the models less useful?
Life. A great example can be seen in the AI-generated baseball-related news articles that involve the Athletics organization. AI articles this year have been generating articles that incorrectly state that the Atlanta Braves played in games that were actually played by the Athletics, and the reason is due to the outdated training model. For the last 60 years before 2025, the Athletics played in Oakland, and during that time their acronym was OAK. In 2025, they left Oakland for Sacramento, and changed their acronym to ATH. The problem is that AI models are trained on 60 years of data where 1. team acronyms are always based on the city, rather than the mascot of the team, and 2. acronyms OAK = Athletics, ATL = Atlanta Braves, and ATH = nothing. As a result, an AI model that doesnt have context "OAK == ATH in the 2025 season" will see ATH in the input data, associates ATH with nothing in it's model, and will then erroneously assume ATH is a typo for ATL.
If they stop getting returns in intelligence, they will switch to returns in efficiency and focus on integration, with new models being trained for new data cutoffs if nothing else. Even today there is at least a 5-10 year integration/adoption period if everything halts tomorrow.
There is no reality in which LLMs go away (shy of being replaced).
> If they stop getting returns in intelligence, they will switch to returns in efficiency
I don't think we can assume that people producing what appear to be addictive services are going to do that, especially when they seem to be addicted themselves.
Is adding new data to a model a full retraining from scratch? Or can it be added on top of an existing model?
If it costs $10B to add 1 year of data to an existing model, every year, that doesn’t sound too good.
They probably are getting a bonanza of intelligence from people using them.
Many argument the current batch of models provide a large capability overhang. That is, we are still learning how to get the most out of these models in various applications
Models don't become out of date now that deep research exists.
So with every prompt you are expected to wait that long? I highly doubt general people will be willing to wait, it also doesn't seem entirely viable if you want to do it locally, less bandwidth and no caching akin to what a literal search engine of data can do.
“Billionaire known for exploiting workers says ‘trust me, you all will benefit from this’”
I think most level-headed people can see this is a giant bubble which will eventually burst like the dot-com crash. And AI is technology that's hard to understand to non-technical (and even some technical) investors.
But of course, every company needs to slap AI on their product now just to be seen as a viable product.
Personally, I look forward to seeing the bubble burst and being left with a more rational view of AI and what it can (and can not) do.
OpenAI has a reasonable path to reduce their costs by 10-100x over the next 5 years if they stop improving the models. That would make them an extremely profitable company with their only real risk being “local ai”. However customers have wanted their data in the cloud for years, local inference would likely just mean 0 cost tokens for OpenAI.
The challenge is the rest of the industry funding dead companies with billions of dollars on the off chance they replicate OpenAI’s success.
I don't see how this works though. OpenAI doesn't exist in a vacuum, it has competitors, and the first company to stop improving their model will get obliterated by the others. It seems like they are doomed to keep retraining right up until the VC funding runs out, at which point they go bankrupt.
Some other company, that doesn't have a giant pile of debt will then pick up the pieces and make some money though. Once we dig out of the resulting market crash.
The winner takes all thesis would be that like TSMC, the capex of competing in this field keeps growing until only one vendor can both raise sufficient capital to compete and effectively execute with that capital. OpenAI doesn't need to be the first to stop raising money and go profitable, they need to be the last vendor to go profits first.
It's not impossible that the crash will hit all companies at the same time and they might all stop training.
OpenAI is trying to launch a hardware product with Jony Ive, an ads company, a AI slop-native version of TikTok and several other "businesses". They look well on their way to turning into a Yahoo! than a Cisco or VMWare.
Yeah they are all over the place and this should be a huge red flag.
Some marginal investors know this but they are okay because the music is still playing - but when they think its time to leave the bubble will pop.
People seem to forget that its not about whether or not its actually a bubble, its really about when will certain people who set these stock prices for valuations, decide its time to exit and take their profit.
The problem is that their competitor is Google and they are much better at most of the things that OpenAI needs to be good at.
The problem is OAI has very firece competition - folks who are willing to absorb losses to put them out of business.
Uber and Amazon are really bad examples. Who was Amazons competition? Nobody. By the time anyone woke up and took them seriously it was too late.
Uber only had to contend with Lyft and a few other less funded firms. Less funded being a really important thing to consider. Not to mention the easy access to immense amounts of funding Uber had.
I too am waiting for the bubble to burst. Particularly because I think it's doing real harm to the industry.
Every company seems to be putting all their eggs in the AI basket. And that is causing basic usability and feature work to be neglected. Nobody cares because they are betting that AI agents will replace all that. But it won't and meanwhile everything else about these products will stagnate.
It's a disasterous strategy and when it comes crashing down and the layoffs start, every CEO will get a pass on leading this failure because they were just doing what everyone else is doing.
How is AI hard to understand when you enter a cafe and everyone is chatting with their LLM?
dotcom bubble had tons of activity, too.
it was making money off those idea at the valuations expected that was problem.
the Internet really did revolutionize things, in substantial ways, but not to the tune of millions of dollars for pets.com
>dotcom bubble had tons of activity, too.
The difference now is that this is all (or mostly) idle cash being invested. The massive warchests built up by FAANG over the last decade are finally being deployed meaningfully rather than sitting in bonds or buying back stock. Much different scenario than companies with non-viable business models going IPO on a wish and a dream.
It's a question of how far the contagion goes - the Dotcom bubble trashed the NASDAQ and rumbled the world a bit, but the "big stocks" weren't directly involved or affected much; the subprime mortgage bubble shook the very foundations of the banking world.
Will the contagion be limited to a few companies, or will the S&P crumble under the bubble's collapse?
in the meantime USA and all the world is going actually all-in AI..
The part that’s hard to understand is how the sunk costs of hundreds of billions in capex gets repaid by all those people in cafes paying hundreds of dollars per month to use those LLMs.
Where do you see that?
In some Hollywood reality, probably.
(Like those people that casually assume that everyone has a therapist or a lawyer.)
Chat rooms webs were sold by millions in the dotcom era.
And everybody used them.
Nowdays everybody see them as useless.
They evolved into Instagram(8 billion), WhatsApp(20 billion) and FB(trillion)
No.
Chats did not evolve to social media.
Facebook is a descendant of hotornot not icq or chats.
Ws was seen as free sms.
Pretty sure discord and slack are not useless…
Discord and slack are evolutions of msn messenger and icq.
Not web chat rooms.
that makes absolutely no sense
msn messenger became Skype wich then became ms teams.
Not hard to use. I meant hard to understand what the limitations are for non tech users. E.g people who think AGI is just around the corner because we now have stochastic parrots.
People have no idea how much concern there was around whether FB would ever be able to monetize social media. That company went public at $15, and nearly closed below that on IPO day.
AI is more useful than social media. This is not financial advice, but I lean more toward not a bubble.
> AI is more useful than social media.
Communication is a fundamental human need.
Generating slop isn't.
Every bubble looks obvious in hindsight. The dot-com crash left behind Amazon and Google. The crypto crash left behind Coinbase and a few real revenue generating companies. If this is the AI bubble, then the survivors are going to look very obvious in a decade, we just don’t know which ones yet.
> The crypto crash left behind Coinbase and a few real revenue generating companies.
A lot of us clocked the crypto bullshit waaaay before the crash.
> A lot of us clocked the crypto bullshit waaaay before the crash.
I'm sorry what crash are you talking about?
Crypto isn't bullshit well most of it is but the utility is still used by millions of people around the world, specifically USDT and USDC which they proven a good way to move your assets without too much regulations.
So it is regulatory arbitrage. I think many of the critics never contested that crypto is good for doing crime. The critics just also think that either those crimes should continue to be prevented via the financial system or the financial system should be deregulated for all without a crypto backdoor.
A Money Market Fund gives you interest if you are able to access it.
This is kind of a pattern:
1. There is some regulation that is inefficient ( e.g. taxi medallions, KYC, copyright protection ...)
2. New technology comes about which allows startups to claim that they have invented a new area that should be regulated differently
3. Turns out (2) is not true and new technology can easily be mapped to existing regulation but it would look bad for the regulator to take away the punchbowl
4. There is some down-turn (bubble pops) and the regulator takes away the punchbowl OR investors have accumulated so much money/power that they corrupt the government to have new rules for their businesses
But google and amazon were obvious to those in the know, in terms of what they delivered.
S Jobs called it back in 1995-97 - he referred to it as shopping for information and shopping for good and services.
Nobody has this crystal clear, tangible vision re. LLMs. Nobody at all. That is a big problem.
I found the interview: https://www.youtube.com/watch?v=MqSfFcaluHc&t=1700s
Personally I never tougth of Google as a dotcom era company. Most of those were landing pages with news and chat rooms.
It was more of web 2.0 company.
It was founded 1998, very much dotcom era, and had no significant web 2.0 products for years after that.
Gmail and Google Maps were prototypical 2.0.
Gmail's beta started in 2004, and Google Maps launched in 2005. Google's IPO was in 2004, so Web 2.0 products played no part in its enormous early growth.
Gmail had a fundamental part in Googles IPO.
And the term 2.0 was coined in 1999.
Right, but the term and the concept didn't really take off until years later. From https://en.wikipedia.org/wiki/Web_2.0:
> The term "Web 2.0" was coined by Darcy DiNucci, an information architecture consultant, in her January 1999 article "Fragmented Future" [...] her "2.0" designation refers to the next version of the Web that does not directly relate to the term's current use.
> The term Web 2.0 did not resurface until 2002.
Google's first big Web 2.0 products were GMail (beta launched in 2004, just before Google's IPO) and Google Maps (2005).
Because LLMs are a technology, not a business.
Ultimately it doesn't matter who survives the AI bubble, because they are all more or less equivalent, proposing the same technical solution.
Just like how sending Katy Perry to space hugely benefitted society.
Could some let Bezos know that he doesn’t truly represent society in any way?
Please, Mister Bezos: fix amazon shop to work again with noscript/basic (x)html browsers (like lynx).
(oh, and keep on eye on all those 'internet scanners', 'script kiddies' using AWS for scans/attacks, honey pot time?).
What is going on with AI right now could be a bubble just like there was the dotcom bubble. But it isn't like the internet went away after the dotcom burst. The largest companies in existence today are internet companies or have products that wouldn't make sense without the internet.
Sure, many of these "thin prompt wrapper around the OpenAI API" product "businesses" will all be gone within a few years. But AI? That is going to be here indefinitely.
The bubble is in the valuations on the stock market, not in the technology.
And their promises.
The "it'll make all your devs 6x as productive by the end of the year" types of promises. But those probably explain the valuations
Yeah, Sam Altman’s recent one saying that his LLMs would “cure cancer” if they built enough data centres was also a winner.
And create a theory of quantum gravity.
i have to say I'm a little disgusted by these statements. LLMs are useful for many problems, but is there really a conceivable path of them making progress into fighting the countless cancers tormenting humanity?
My framing device: if you had LLMs in the 1500s, how would that help Copernicus determine the orbits of the planets? Maybe through dumb chance, but creating a well reasoned model of the universe required new observations and the ability to interpret the data from a different point of view.
All the 1500s and earlier data that such an LLM would have to have been trained on would lead to an LLM that wouldn’t ever suggest a heliocentric solar system. That LLM might even say he was heretical or refuse to give an answer to anything that led to it saying that the earth wasn’t the centre of the universe. So no help at all.
More likely the LLM would condescendingly tell him that he was wrong and that the earth was clearly at the centre of the universe.
Depending on the time of creation, it might be impossible for the LLM NOT to tell him he's wrong and the earth is the center of the universe.
Interesting framing. Although I assume all the observations had been done already. It was more about being bold enough to investigate a line of thought that wasn't obvious or popular at the time and proving it convincingly.
They already had many "explanations" and models for why the planets were seemingly moving back and forth in the sky during the year. Their models were more complicated than necessary simply because they didn't want to consider the different premise.
Without those sorts of revolutionary claims, would they still be receiving enough funding to keep the lights on?
Thats not true actually.
The technology - for what it is being used vs what is invested - does not match up at all. This is what happened to the dot-com bubble. Theres was a whole bunch of innovation that was needed to come to bring a delightful UX to bring swathes of people onto the internet.
So far this is true about LLMs. Could this change? Sure. Will it change meaningful? Personally I dont believe so.
The internet at its core was all about hooking up computers so they they could transform from just computational beasts to communication. There was a tremendous amount of potentitial that was very very real. It just so happens if computers can communicate we can do a whole bunch of stuff - as is going on today.
What are LLMS? Can someone please explain in a succint way...? Im yet to see something super crystal clear.
AI has been here well before transformers. Please, let's not pretend that AI started with LLM chatbots.
Things like recommendations, ads, and search will always be around because they were money printers before VCs found out about AI and they will continue to be long after.
This is always a bad take.
The dotcom bubble was not about "the internet" itself. The Internet was fine and pretty much already proven as a very useful communication tool. It was about business that made absolutely no sense getting extremely high valuations just because they operated - however vaguely - over the internet.
Generative AI have never reached the level of usability of the Internet itself, and likely never will.
I feel better knowing that someone that is as in touch with society as he is, is saying this.
> Jeff Bezos says AI is in a bubble but society will get 'gigantic' benefits
Yes. Cheap, second hand, datacenters.
If you're asking yourself why hasn't the bubble burst when everyone is calling it a bubble it's because no one wants to stop dancing until the music stops. If you told an investor the market will collapse tomorrow with 100% certainty they will invest today like there is 0% certainty of it happening tomorrow.
There’s a typo. “Society” should be written as “five billionaires”
> “That is what is going to happen here too. This is real, the benefits to society from AI are going to be gigantic.”
As an owner of a web host that probably sees advantage to increased bot traffic, this statement is just more “just wait AI will be gigantic any minute now, keep investing in it for me so my investments stay valuable”.
By society, he means the oligarchy will get more power and control.
Yeah, sure some side benefits to people. AI is still a nuclear weapon against labor in the capital - labor (haves - haves not), and will start pushing wealth inequality to the Egyptian pharoah.
The only good news for plebians is that virtual reality entertainment means you just need a little closet to live in.
Overall, this just leads up to further demographic decline, which as an environmental malthusian I would welcome in the initial stages to get us down from our current level, but I also suspect it would turn into an economic downward spiral, especially with AI, where the oligarchs have such total authoritarian control and monopoly on resources that humanity basically stops having kids at all.
"Commodity Tokens"
AI is in a bubble like we don't need more than 16kb.
My translation of what Jeff says:
"AI is in a bubble but billionaires will get 'gigantic' benefits"
I see no benefit to anyone unless you can live off your stock portfolio and can easily ride through periods where your portfolio can suffer a 50% loss.
Honestly, during the dotcom bubble at least workers were getting paid and jobs were abundant. Things didn't start getting bad for workers until it popped. We're supposed to be in the 'positive' part of the AI bubble and people already seem desperate and out of hope.
Everyone not directly involved seems to want AI to pop. I'm not sure if that says anything about its longevity. Not very fun to have a bubble that feels bad on both sides.
[stub for offtopicness]
(title fixed now)
Totally wrong title
@dang
Title needs to be changed to something like
"Bezos says AI is in industrial bubble yet promises huge benefits"
Tagging doesn't work on HN.
Very misleading clipping of the headline imo
He may be right, everything points to that conclusion. My main issue is - why the fuck do we care what Bezos thinks on this matter? His ML efforts all lag behind the competition and he’s certainly not an expert in the field of deep learning. Why?
Oh if Jeff Bezos says it then it must be true