The real question is whether the boom is, economically, a mistake.
If AI is here to stay, as a thing that permanently increases productivity, then AI buying up all the electricians and network engineers is a (correct) signal. People will take courses in those things and try to get a piece of the winnings. Same with those memory chips that they are gobbling up, it just tells everyone where to make a living.
If it's a flash in a pan, and it turns out to be empty promises, then all those people are wasting their time.
What we really want to ask ourselves is whether our economy is set up to mostly get things right, or it is wastefully searching.
This is the trade-off to connectivity and removing frictional barriers (i.e., globalism). This is the economic equivalent of what Nick Land and Spandrell called the "IQ shredder". Spandrell said of Singapore:
Singapore is an IQ shredder. It is an economically productive metropolis that
sucks in bright and productive minds with opportunities and amusements at the
cost of having a demographically unsustainable family unit.
Basically, if you're a productive person, you want to maximize your return. So, you go where the action is. So does every other smart person. Often that place is a tech hub, which is now overflowing with smart guys. Those smart guys build adware (or whatever) and fail to reproduce (combined, these forces "shred" the IQ). Meanwhile every small town is brain-drained. You hometown's mayor is 105 IQ because he's the smartest guy in town. Things don't work that great, and there's a general stagnation to the place.
Right now, AI is a "capital shredder". In the past, there were barriers everywhere, and we've worked hard to tear those down. It used to be that the further the distance (physically, but also in other senses too, like currencies, language, culture, etc.), the greater the friction to capital flows. The local rich guy would start a business in his town. Now he sends it to one of the latest global capital attractors, which have optimized for capital inflow. This mechanism works whether the attractor can efficiently use that capital or not. That resource inflow might be so lucrative, that managing inflow is the main thing it does. Right now that's AI, but as long as present structure continues, this is how the machine of the global economy will work.
This is another facet of the fierce opposition to AI by a swath of the population: it’s quite literally destroying the last bit of enjoyment we could wring from existence in the form of hobbies funded through normal employment.
Think of the PC gamers, who first dealt with COVID supply shocks, followed by crypto making GPUs scarce and untenable, then GPU makers raising prices and narrowing inventory to only the highest-end SKUs, only to outright abandon them entirely for AI - which then also consumed their RAM and SSDs. A hobby that used to be enjoyed by folks on even a modest budget is now a theft risk given the insane resale priced of parts on the second-hand market due to scarcity.
And that extends to others as well. The swaths of folks who made freelance or commission artistry work through Patreons and conventions and the like are suddenly struggling as customers and companies spew out AI slop using their work and without compensation. Tech workers, previously the wealthy patron of artisans and communities, are now being laid off en masse for AI CapEx buildouts and share pumps as investors get cold feet about what these systems are actually doing to the economy at large (definite bad, questionable good, uncertain futures).
Late stage capitalism’s sole respite was consumerism, and we can’t even do that anymore thanks to AI gobbling up all the resources and capital. It’s no wonder people are pissed at AI boosters trying to say this is a miracle technology that’ll lift everyone up: it’s already kicking people down, and nobody actually wants to admit or address that lest their investments be disrupted to protect humans.
Sure, but the end-state of this isn't just chat bots! Bipedal robots are the real target application for this technology, and at least three big players have invested many billions each into base model training. The "GPT 2 moment" for robotics will happen likely later this year, next year at the latest. Then, the company that scales up from there to the equivalent of GPT 3.5 -- the first properly useful model -- can start selling androids by the tens of millions.
It'll be the next automobile, every well-to-do household will want one eventually. Every hospital, to assist/replace nurses. Every retirement home for the same reason.
Japan and China alone, with their ageing populations in dire need of nursing, will easily pay for the investment with that one use-case.
Is there really for the ML boom, or is it just a way to make computers more and more expensive to push people towards mobile? Because looking around, that's the effect I'm seeing, regardless of the causes.
I see a future where most people will buy tablets to save money and the desktop will be for only a few, a very few, just when self-hosting is becoming trendy and people are saying "it's time for GNU/Linux to take Windows' place"...
It’s definitely not causing shortages of people, with tens of thousands and more getting laid off every month!
The AI boom is just like a conference- where new and shiny seems to do wonders, but when you come back to workplace, none of that seem to work or fit in!
It's time that societies act against this cancer. When everything else suffers because the cancer is stealing all sorts of resources, a human would go to a doctor and have the cancer killed chemically or excised.
Relax, before you drafted regulation and rolled it out this bubble will have peaked.
Unless your rolling out dumb reactionary regulation like forbid AI or crypto coins, etc.
It's annoying right now, but on a timescale of 5-10 years ram/gpu prices will be back to normal.
Could we regulate investors reduce risk of bubbles maybe, but it's hard. Probably easier to limit the impact of bubbles on humans with a social safety net.
> Smartphones are expected to get pricier for potentially years to come.
"Smart" phones have ceased to be smart years ago. They are now instruments of mass surveillance, and the tech industry has convinced people that 1) you need one not to be a social outcast, 2) you need to upgrade it every year, 3) not having root access is for your own good.
I'll stick to my Pixel 9a running Graphene for the forseeable future.
- bigger TV, my "old" not even 4K video projector is enough
- faster phone with more memory or better camera, my current one as "just" 5G, is enough
- faster laptop/desktop, I can work on the laptop, game on desktop
- higher resolution VR headsets (but I'll still get a Steam Frame because it's more free)
- denser smart watch, I'm not even using the ones I have
... so, the situation is bad, yes, and yet I don't really care. The hardware I have is good enough and in fact regardless of AI I've been arguing we've reached "peak" IT few years ago already. Of course I wouldn't mind "better" everything (higher resolution, faster refresh rate, faster CPU/GPU, more memory, more risk, etc). What I'm arguing for though is that most "normal" users (please, don't tell me you're a video editor for National Geographic who MUST edit 360 videos in 8K! That's great for you, honestly, love that, but that's NOT a "normal" user!) who bough high end hardware during the last few year matches most of their capabilities.
All that being said, yes, pop that damn bubble, still invest in AI R&D and datacenters, still invest in AI public research for energy, medicine, etc BUT not the LLM/GenAI tulip commercial craze.
Almost positive 'ol Bessent has by now warned Trump that there is an issue with the AI queens breaking 1930s securities reform laws. Last week's stock market and crypto moves have all but sealed the fate of the Bozo No Bozos. They will take down the people involved with the funky purchase orders quietly, except inside of the closed door meetings where they get handled. https://youtu.be/y_z9W_N5Drg
My local (urban) residential electricians aren't even busy -- they are booking less than a week out. By contrast, just last year they were booking six weeks out. The fall in EV infrastructure demand due to eliminated incentives might be impacting them more than additional data center demand.
many users here are not willing to try anything new that might give it a chance. even if i show someone a better alternative, they still wont use it because no one else is using it. people need to be told what to do. initiative has been beaten out of you all.
Gen pop can diversify its skillset, become more independently self sufficient as a result, rely on/require less money overall, and realize they don't really need to listen to rich tech CEOs which will implode their value politically.
SaaS jobs were about little more than agency control and now they're losing that control.
Does anyone know the high-level breakdown of where the money's going and how long that part (energy production, energy transmission, network, datacenter, servers/GPUs) lasts?
"JPMorgan calculated last fall that the tech industry must collect an extra $650 billion in revenue every year — three times the annual revenue of AI chip giant Nvidia — to earn a reasonable investment return. That marker is probably even higher now because AI spending has increased."
That pretty much tells you how this will end, right there.
57 comments
[ 4.6 ms ] story [ 68.8 ms ] threadIf AI is here to stay, as a thing that permanently increases productivity, then AI buying up all the electricians and network engineers is a (correct) signal. People will take courses in those things and try to get a piece of the winnings. Same with those memory chips that they are gobbling up, it just tells everyone where to make a living.
If it's a flash in a pan, and it turns out to be empty promises, then all those people are wasting their time.
What we really want to ask ourselves is whether our economy is set up to mostly get things right, or it is wastefully searching.
Right now, AI is a "capital shredder". In the past, there were barriers everywhere, and we've worked hard to tear those down. It used to be that the further the distance (physically, but also in other senses too, like currencies, language, culture, etc.), the greater the friction to capital flows. The local rich guy would start a business in his town. Now he sends it to one of the latest global capital attractors, which have optimized for capital inflow. This mechanism works whether the attractor can efficiently use that capital or not. That resource inflow might be so lucrative, that managing inflow is the main thing it does. Right now that's AI, but as long as present structure continues, this is how the machine of the global economy will work.
Think of the PC gamers, who first dealt with COVID supply shocks, followed by crypto making GPUs scarce and untenable, then GPU makers raising prices and narrowing inventory to only the highest-end SKUs, only to outright abandon them entirely for AI - which then also consumed their RAM and SSDs. A hobby that used to be enjoyed by folks on even a modest budget is now a theft risk given the insane resale priced of parts on the second-hand market due to scarcity.
And that extends to others as well. The swaths of folks who made freelance or commission artistry work through Patreons and conventions and the like are suddenly struggling as customers and companies spew out AI slop using their work and without compensation. Tech workers, previously the wealthy patron of artisans and communities, are now being laid off en masse for AI CapEx buildouts and share pumps as investors get cold feet about what these systems are actually doing to the economy at large (definite bad, questionable good, uncertain futures).
Late stage capitalism’s sole respite was consumerism, and we can’t even do that anymore thanks to AI gobbling up all the resources and capital. It’s no wonder people are pissed at AI boosters trying to say this is a miracle technology that’ll lift everyone up: it’s already kicking people down, and nobody actually wants to admit or address that lest their investments be disrupted to protect humans.
Every week in 2026 Google will pay for the cost of a Burj Khalifa. Amazon for a Wembley Stadium.
Facebook will spend a France-England tunnel every month.
It'll be the next automobile, every well-to-do household will want one eventually. Every hospital, to assist/replace nurses. Every retirement home for the same reason.
Japan and China alone, with their ageing populations in dire need of nursing, will easily pay for the investment with that one use-case.
I see a future where most people will buy tablets to save money and the desktop will be for only a few, a very few, just when self-hosting is becoming trendy and people are saying "it's time for GNU/Linux to take Windows' place"...
Now if the LLMs could modify their own nets, and improve themselves, then that would be immensely valuable for the world.
But as of now, its a billionaires wet dream to threaten all workers as a way to replace labor.
The AI boom is just like a conference- where new and shiny seems to do wonders, but when you come back to workplace, none of that seem to work or fit in!
Unless your rolling out dumb reactionary regulation like forbid AI or crypto coins, etc.
It's annoying right now, but on a timescale of 5-10 years ram/gpu prices will be back to normal.
Could we regulate investors reduce risk of bubbles maybe, but it's hard. Probably easier to limit the impact of bubbles on humans with a social safety net.
"Smart" phones have ceased to be smart years ago. They are now instruments of mass surveillance, and the tech industry has convinced people that 1) you need one not to be a social outcast, 2) you need to upgrade it every year, 3) not having root access is for your own good.
I'll stick to my Pixel 9a running Graphene for the forseeable future.
- bigger TV, my "old" not even 4K video projector is enough
- faster phone with more memory or better camera, my current one as "just" 5G, is enough
- faster laptop/desktop, I can work on the laptop, game on desktop
- higher resolution VR headsets (but I'll still get a Steam Frame because it's more free)
- denser smart watch, I'm not even using the ones I have
... so, the situation is bad, yes, and yet I don't really care. The hardware I have is good enough and in fact regardless of AI I've been arguing we've reached "peak" IT few years ago already. Of course I wouldn't mind "better" everything (higher resolution, faster refresh rate, faster CPU/GPU, more memory, more risk, etc). What I'm arguing for though is that most "normal" users (please, don't tell me you're a video editor for National Geographic who MUST edit 360 videos in 8K! That's great for you, honestly, love that, but that's NOT a "normal" user!) who bough high end hardware during the last few year matches most of their capabilities.
All that being said, yes, pop that damn bubble, still invest in AI R&D and datacenters, still invest in AI public research for energy, medicine, etc BUT not the LLM/GenAI tulip commercial craze.
My local (urban) residential electricians aren't even busy -- they are booking less than a week out. By contrast, just last year they were booking six weeks out. The fall in EV infrastructure demand due to eliminated incentives might be impacting them more than additional data center demand.
Gen pop can diversify its skillset, become more independently self sufficient as a result, rely on/require less money overall, and realize they don't really need to listen to rich tech CEOs which will implode their value politically.
SaaS jobs were about little more than agency control and now they're losing that control.
That pretty much tells you how this will end, right there.
The numbers actually work really well, (un)fortunately.
If you take half the software engineers in the US and replace them with AI, you're halfway there. And why stop with software?
There's a reason for the fervor and excitement of these companies.
The positive outlook is that you don't fire folks - they have even more work to do. But we'll see how it pans out in practice.
It seems so blatantly obvious, yet nobody wants to listen, and practically everyone knows better. We live in interesting times.
The economics are not all in profit.
Where's the "boom?" Doesn't that imply a bunch of people are getting rich off of new business?
Where are those?