[HN Gopher] Google boss says AI investment boom has 'elements of...
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       Google boss says AI investment boom has 'elements of irrationality'
        
       Author : jillesvangurp
       Score  : 121 points
       Date   : 2025-11-18 06:06 UTC (16 hours ago)
        
 (HTM) web link (www.bbc.com)
 (TXT) w3m dump (www.bbc.com)
        
       | ZYbCRq22HbJ2y7 wrote:
       | Except, yes, they will.
       | 
       | Not immune, maybe, but pretty well off if they didn't buy in.
        
       | WarOnPrivacy wrote:
       | I'm okay with being victim to RAM and NVME prices returning to
       | pre-skyrocket levels.
        
         | general1465 wrote:
         | And GPUs being available again for normal prices.
        
       | aurareturn wrote:
       | Is it really a bubble about to burst when literally everyone is
       | talking about AI being in a bubble and maybe bursting soon?
       | 
       | To me, we're clearly not peak AI exuberance. AI agents are just
       | getting started and getting so freaking good. Just the other day,
       | I used Vercel's v0 to build a small business website for a
       | relative in 10 minutes. It looked fantastic and very mobile
       | friendly. I fed the website to ChatGPT5.1 and asked it to improve
       | the marketing text. I fed those improvements back to v0. Finished
       | in 15 minutes. Would have taken me at least one week in the past
       | to do a design, code it, test it for desktop/mobile, write the
       | copy.
       | 
       | The way AI has disrupted software building in 3 short years is
       | astonishing. Yes, code is uniquely great for LLM training due to
       | open source code and documentation but as other industries catch
       | up on LLM training, they will change profoundly too.
        
         | zerosizedweasle wrote:
         | Let him cook
        
         | watwut wrote:
         | > Is it really a bubble about to burst when literally everyone
         | is talking about AI being in a bubble and maybe bursting soon?
         | 
         | Yes, it is even one of necessary components. Everybody is
         | twitchy afraid of the pop, but immediate returns are too
         | tempting so they keep money in. The bubble pops when
         | _something_ happens and they all start to panicking at the same
         | time. They all need to be sufficiently stressed for that mass
         | run to happen.
        
           | aurareturn wrote:
           | So after the bubble pops, do you think the AI market will
           | still be bigger in November 2025?
           | 
           | In other words, do you think we're in 1995 of the dotcom or
           | 2000?
        
         | camillomiller wrote:
         | This is a very biased example. Also, it is possible only
         | because right now the tools you've used are heavily subsidised
         | by investors' money. A LOT of it. Nobody questions the utility
         | of what you just mentioned, but nodoby stops to ask if this
         | would be viable if you were to pay the actual cost of these
         | models, nor what it means for 99.9% of all the other jobs that
         | AI companies claim can be automated, but in reality are not
         | even close to be displaced by their technology.
        
           | aurareturn wrote:
           | Why is it biased?
           | 
           | So what if it's subsidized and companies are in market share
           | grab? Is it going to cost $40 instead of $20 that I paid? Big
           | deal. It still beats the hell out of $2k - $3k that it would
           | have taken before and weeks in waiting time.
           | 
           | 100x cheaper, 1000x faster delivery. Further more, v0 and
           | ChatGPT together for sure did much better than the average
           | web designer and copy writer.
           | 
           | Lastly, OpenAI has already stated a few times that they are
           | "very profitable" in inference. There was an analysis posted
           | on HN showing that inference for open source models like
           | Deepseek are also profitable on a per token basis.
        
             | ido wrote:
             | LLMs are particularly good at web development (granted
             | that's a big market), probably due to a lot of the training
             | material being that.
        
             | qcnguy wrote:
             | We don't know what AI should cost but if you look at the
             | numbers then 2x more expensive is much too low.
             | 
             | Think about the pricing. OpenAI fixed everyone's prices to
             | free and/or roughly the cost of a Netflix subscription,
             | which in turn was pinned to the cost of a cable TV
             | subscription (originally). These prices were made up to
             | sound good to his friends, they weren't chosen based on
             | sane business modelling.
             | 
             | Then everyone had to follow. So Anthropic launched Claude
             | Code at the same price point, before realizing that was
             | deadly and overnight the price _went up by an order of
             | magnitude_. From $20 to $200 /month, and even that doesn't
             | seem to be enough.
             | 
             | If the numbers leaked to Ed Zitron are true then they
             | aren't profitable on inference. But even if that were true,
             | so what? It's a meaningless statement, just another way of
             | saying they're still under-pricing their models.
             | Inferencing and model licensing are their only revenue
             | streams! That has to cover everything including training,
             | staff costs, data licensing, lawsuits, support, office
             | costs etc.
             | 
             | Maybe OpenAI can launch an ad network soon. That's their
             | only hope of salvation but it's risky because if they botch
             | it users might just migrate to Grok or Gemini or Claude.
        
               | aurareturn wrote:
               | Then everyone had to follow. So Anthropic launched Claude
               | Code at the same price point, before realizing that was
               | deadly and overnight the price went up by an order of
               | magnitude. From $20 to $200/month, and even that doesn't
               | seem to be enough.
               | 
               | Maybe it was because demand was so high that they didn't
               | have enough GPUs to serve? Hence, the insane GPU demand?
        
               | jmpman wrote:
               | I've wondered if it makes sense to buy Intel along with
               | Cerebrus in order to use Intels newest nodes while under
               | development to fab the Cerebrus wafer level inference
               | chips which are more tolerant of defects. Overall that
               | seems like the cheapest way to perform inference - if you
               | have $100B.
        
             | camillomiller wrote:
             | If it subsidized it's a problem because we're not talking
             | about Uber trying to disrupt a clearly flawed system of
             | transportation. We're talking about companies whose entire
             | promise is an industrial revolution of a scale we've never
             | seen before. That is the level of the bet. The fact they
             | did much better than the average professional is also your
             | own take and assessment that is purely self evident. Also,
             | your example has fundamentally no value. You mentioned a
             | marginal use case that doesn't scale. Personal websites
             | will be quicker to make because you can get whatever the AI
             | spews your way, you have basically infinite flexibility and
             | the only contraints are "getting it done" and "looking
             | ok/good". That is not how larger business work, at all. So
             | there is a massive issue of scalability of this. Finally,
             | OpenAI "states" a lot of things, and a lot of them have
             | been proven to be flat out lies, because they're led by a
             | man who has been proved to be a pathological narcissistic
             | liar many times over. Yet you keep drinking the kool aid,
             | inlcuding about inference. There are by the way reports
             | that, data in hand, prove quite convincingly that "being
             | profitable on inference" seems to be math gymnastics, and
             | not at all the financial reality of OpenAI.
        
               | aurareturn wrote:
               | The vast majority of highly valuable tech companies in
               | the last 35 years have subsidized their products or
               | services in the beginning as they grew. Why should OpenAI
               | be any different? In particular the tokenomics is already
               | profitable.
        
         | StopDisinfo910 wrote:
         | I think you are missing the fundamental point here. The
         | question is not really if AI has some value. That much is
         | obvious and the exemple you give, increasing developer
         | productivity, is a good one.
         | 
         | The question is: is the value generated by AI aligned with the
         | market projected value as currently priced in AI companies
         | valuation? That's what's more difficult to assess.
         | 
         | The gap between fundamental financial data and valuations is
         | very large. The risk is a brutal reassessment of these prices.
         | That's what people call a bubble bursting and it doesn't mean
         | the underlying technology has no value. The internet bubble
         | burst yet the internet is probably the most significant
         | innovation of the past twenty years.
        
           | Xelbair wrote:
           | Well it all started with usual SV style "growth
           | hacking"(price dumping as a SaaS) of "gather users now,
           | monetize later" by OpenAI - which works only if you attain
           | virtual monopoly(basically dominance over segment of a
           | market, with competition not really competing with you) over
           | segment of the market.
           | 
           | The problem is no one attained that position, price
           | expectations are set and it turns out that wishful thinking
           | of reducing costs of running the models by orders of
           | magnitude wasn't fruitful.
           | 
           | Is AI useful? of course.
           | 
           | Are the real costs of it justified? in most cases no.
        
           | aurareturn wrote:
           | The question is: is the value generated by AI aligned with
           | the market projected value as currently priced in AI
           | companies valuation? That's what's more difficult to assess.
           | 
           | I agree it is difficult to assess. Right now, competitive
           | pressure is causing big players to go all in or get left
           | behind.
           | 
           | That said, I don't think the bubble is done growing nor do I
           | think it is about to burst.
           | 
           | I personally think we are in 1995 of the dotcom bubble
           | equivalent. When it bursts, it will still be much bigger than
           | in November 2025.
        
         | TrackerFF wrote:
         | It's not that the AI models or products don't work.
         | 
         | It's how much money is being poured into it, how much of the
         | money that is just changing hands between the big players, the
         | revenue, and the valuations.
        
           | aurareturn wrote:
           | Well, do you have a model for this? Or is it just
           | regurgitating mass media that it's a bubble?
           | 
           | If hyperscalers keep buying GPUs and Chinese companies keep
           | saying they don't have enough GPUs, especially advanced ones,
           | why should we believe someone that it's a bubble based on
           | "feel"?
        
         | checker659 wrote:
         | The economics of it is what's the problem, not the power of
         | LLMs.
        
           | aurareturn wrote:
           | So tell us the economics of it?
           | 
           | The vast majority of AI doomers in the mass media have never
           | used tools like v0 or Cursor. How would they know that AI is
           | overvalued?
        
       | rvz wrote:
       | Most of all of Big Tech, especially Google are doing just fine,
       | making $100B a quarter.
       | 
       | Startups and other unprofitable companies however...
        
         | marcyb5st wrote:
         | After COVID they were still making a killing, but axed 12k
         | people anyway. So, if someone starts doing layoffs and the
         | market reacts well profitable companies will do layoffs as well
        
         | gizajob wrote:
         | You do have to question the usefulness of Big Tech burning all
         | that profit to the ground in order to buy GPUs though.
        
       | thisislife2 wrote:
       | In other words - _" We will be firing many of you when the bubble
       | bursts."_
        
       | yawpitch wrote:
       | It's not a matter of _if_ , it's a matter of _when_.
        
       | donkeylazy456 wrote:
       | Now they are talking like Wall Street greedy bankers back in
       | subprime crisis.
        
         | Ekaros wrote:
         | Also it seems like Wall Street greedy bankers might have an
         | other subprime crisis on their hands at same time... I wonder
         | which one will be saved again...
        
       | TrackerFF wrote:
       | Sounds like _" We're too big to fail. If we go down, everyone
       | goes down. It is your choice."_
       | 
       | But unlike 08 crisis, we're getting a heads up to bring out the
       | lube.
        
         | franktankbank wrote:
         | I hope it goes down. Its really not a very powerful threat.
        
       | nabla9 wrote:
       | Google, Meta, Microsoft, and Amazon will get through easily. They
       | don't have excessive debt. They can afford to lose their
       | investments into AI. Their valuations will take a hit. Nvidia
       | will lose revenue and profits, stock will go down by 60% or more,
       | but it will also survive.
       | 
       | Oracle will likely fail. It funded its AI pivot with debt. The
       | Debt-to-Revenue ratio is 1.77, the Debt-to-Equity ratio D/E is
       | 520, and it has a free cash flow problem.
       | 
       | OpenAI, Anthropic, and others will be bought for cents on the
       | dollar.
        
         | tow21 wrote:
         | Google, Meta, Microsoft and Amazon might get through easily _as
         | companies_. I don 't think all G/M/M/A staff will get through
         | easily.
        
           | conartist6 wrote:
           | Microsoft is in a pickle. They put AI lipstick on top of
           | decades of unfixed tech debt and their relationship with
           | their userbase isn't great. Their engineering culture is
           | clearly not healthy. For their size and financial resources,
           | their position in the market right now is _very_ delicate.
        
             | StopDisinfo910 wrote:
             | I don't think so.
             | 
             | They are one of the few companies actually making money
             | with AI as they have intelligently leveraged the position
             | of Office 365 in companies to sell Copilot. Their AI
             | investment plans are, well, plans which could be scaled
             | down easily. Worst case scenario for them is their
             | investment in OpenAI becoming worthless.
             | 
             | It would hurt but is hardly life threatening. Their revenue
             | driver is clearly their position at the heart of entreprise
             | IT and they are pretty much untouchable here.
        
               | thewebguyd wrote:
               | > Worst case scenario for them is their investment in
               | OpenAI becoming worthless.
               | 
               | And even then, if that happens when the bubble pops,
               | they'll likely just acquire OpenAI on the cheap. Thanks
               | to the current agreement, it already runs on Azure, they
               | already have access to OpenAI's IP, and Microsoft has
               | already developed all their Copilots on top of it. It
               | would be near-zero cost for Microsoft at that point to
               | just absorb them and continue on as they are today.
               | 
               | Microsoft isn't going anywhere, for better or for worse.
               | 
               | Despite them pissing off users with Windows, what HN
               | forgets, is they aren't Microsoft's customer. The
               | individual user/consumer never was. We may not want what
               | MS is selling, but their enterprise customers definitely
               | do.
        
             | throwawayffffas wrote:
             | I think that's the impression you get if you focus on
             | Microsoft as a OS vendor. It's not that anymore, that's why
             | their OS sucks for many years now. Their main business is
             | b2b, cloud services, and azure. I think they are pretty
             | safe from OpenAI. Plus they have invested big in OpenAI as
             | well.
        
               | Ekaros wrote:
               | Windows is hard to replace in large organizations. Is
               | there actually any real AI competitors in the stack? Well
               | Google, maybe. The whole Windows+Office+AD+Exchange and
               | now Azure stack is unlikely to go any time soon. However
               | badly they screw it up.
        
               | robotnikman wrote:
               | True. Basically any medium to large scale business is
               | reliant on Windows/Office/AD. While there are open source
               | alternatives to Windows/Office, I can't think of a good
               | open source alternative to AD/Group Policy/etc
        
               | goalieca wrote:
               | M365 is arguably far worse than office97.
               | Drive/sharepoint is confusing and team is especially
               | broken.
               | 
               | Azure is a product all right, but there's nothing
               | particularly better there than anywhere else.
        
           | nabla9 wrote:
           | I cry for Elon, that precious jewel of a human being.
           | 
           | Tesla (P/E: 273, PEG: 16.3) the car maker without robots,
           | robotaxis is less than 15% of the Tesla valuation at best.
           | When the AI hype dies, selloff starts and negative sentiment
           | hits, we have below $200B market cap company.
           | 
           | It will hurt Elon mentally. He will need a hug.
        
             | slaw wrote:
             | Never bet against TSLA. Elon will just start selling
             | tickets Mars colony.
        
             | officeplant wrote:
             | He's gonna need a lot of ketamine in the aftermath that's
             | for sure.
        
             | Rover222 wrote:
             | Then show us your puts, mr buffet
        
               | bdangubic wrote:
               | lol - yea...
        
             | gizajob wrote:
             | The fanboys obsessively buy any dip. It should have been
             | back at a $200billion market cap countless times but it
             | never gets there.
        
         | aurareturn wrote:
         | OpenAI, Anthropic, and others will be bought for cents on the
         | dollar.
         | 
         | OpenAI is existential threat to all big tech including Meta,
         | Google, Microsoft, Apple. Hence, they're all spending lavishly
         | right now to not get left behind.
         | 
         | Meta --> GenAI Content creation can disrupt Instagram. ChatGPT
         | likely has more data on a person than Instagram does by now for
         | ads. 800 million daily active users for ChatGPT already.
         | 
         | Google --> Cash cow search is under threat from ChatGPT.
         | 
         | Microsoft --> Productivity/work is fundamentally changed with
         | GenAI.
         | 
         | Apple --> OpenAI can make a device that runs ChatGPT as the OS
         | instead of relying on iOS.
         | 
         | I'm betting that OpenAI will emerge bigger than current big
         | tech in ~5 years or less.
        
           | nabla9 wrote:
           | OpenAI has no technical moat (others can do what they do),
           | generate content, all have the same data.
           | 
           | OpenAI does not expect to be cash-flow positive until 2029.
           | When no new capital comes in, it can't continue.
           | 
           | OpenAI can's survive any kind of price competition.
        
             | aurareturn wrote:
             | They consistently have the best or second best models.
             | 
             | They have infrastructure that serves 800 million monthly
             | active users.
             | 
             | Investors are lining up to give them money. When they IPO,
             | they'll easily be worth over $1 trillion.
             | 
             | There's price competition right now. They're still
             | surviving. If there is price competition, they're the most
             | likely to survive.
        
               | nabla9 wrote:
               | > Investors are lining up to give them money. When they
               | IPO, they'll easily be worth over $1 trillion.
               | 
               | Your premise is that there is no bubble. We are talking
               | about what happens when bubble bursts. Without investor
               | money drying out there is no bubble.
        
               | aurareturn wrote:
               | I think we are in 1995 of the dotcom bubble for AI.
        
               | arunabha wrote:
               | Clearly, a _lot_ of people here disagree with you. Doesn
               | 't mean you cannot be right, but in general, the HN crowd
               | is a pretty good predictor of the trends in the tech
               | industry.
        
               | gizajob wrote:
               | More like 1998
        
               | jimbokun wrote:
               | What if investors stop giving them money before they IPO?
        
               | NumberCruncher wrote:
               | They have <a really expensive> infrastructure that serves
               | 800 million monthly active <but non-paying> users.
               | 
               | Even worse, they train their model(s) on the interactions
               | of those non-paying customers, what makes the model(s)
               | less useful for paying customers. It's kind of a "you can
               | not charge for a Porsche if you only satisfy the needs of
               | a typical Dacia owner".
        
           | j_w wrote:
           | > Apple --> OpenAI can make a device that runs ChatGPT as the
           | OS instead of relying on iOS.
           | 
           | Yeah... No they can't. I don't agree with any of your
           | "disruptions," but this one is just comically incorrect.
           | There was a post on HN somewhat recently that was a simulated
           | computer using LLMs, and it was unusable.
        
           | r053bud wrote:
           | I'll HAPPILY bet that it won't. $10,000 to a charity of each
           | other's choosing?
        
           | officeplant wrote:
           | >Apple --> OpenAI can make a device that runs ChatGPT as the
           | OS instead of relying on iOS.
           | 
           | Ah yes, PromptOS will go down in the history books for sure.
        
           | thewebguyd wrote:
           | > I'm betting that OpenAI will emerge bigger than current big
           | tech in ~5 years or less.
           | 
           | I seriously doubt it. If this bubble pops, the best OpenAI
           | can hope for is they just get absorbed into Microsoft.
        
         | belter wrote:
         | You will be able to rent a whole Meta datacenter with thousands
         | of NVIDIA B200 for $5/hour. AWS will become unprofitable due to
         | abundance of capacity...
        
         | surgical_fire wrote:
         | > Google, Meta, Microsoft, and Amazon will get through easily.
         | They don't have excessive debt. They can afford to lose their
         | investments into AI.
         | 
         | Survive, yes. I don't think anybody ever questioned this.
         | 
         | I wonder if they will be able to remain as "growth stocks",
         | however. These companies are allergic to be seen as nature
         | companies, with more modest growth profiles, share profits,
         | etc.
        
       | throwawayffffas wrote:
       | Obviously, at least in the US the AI bubble is the only thing
       | keeping the economy afloat. If it wasn't for the bubble the US
       | would be in a recession.
       | 
       | Not sure how the situation is in Europe and Asia, but I would
       | guess about the same.
        
       | clickety_clack wrote:
       | Sounds like something an extortionist would say in a movie.
       | "We're all dirty here!"
        
         | project2501a wrote:
         | Yeah, exactly: it is an implied threat: "If I go, I am taking
         | you down with me"
        
           | SpicyLemonZest wrote:
           | The context makes it clear that it's not any sort of implied
           | threat. Pichai made his statement in response to an interview
           | question about whether Google might be so well positioned
           | that they're immune to the impact of an AI bubble. (But I
           | don't blame you for being misled - like most headlines these
           | days, this would have been intensely optimized for virality
           | over accuracy, and making tech CEOs sound like supervillains
           | is great for virality.)
        
         | pixl97 wrote:
         | I mean this commonly happens in business/economies. Businesses
         | that are dirty can make more money, at least temporarily out
         | competing those around them. If they play it right they can
         | drive their good competitors out of business or buy them up.
         | Moreso, the crash at the end of a bubble will just as likely
         | drive the good businesses out as the bad.
        
         | lo_zamoyski wrote:
         | "But everybody's doing it!"
        
         | jordanb wrote:
         | They really are shameless aren't they?
         | 
         | Makes one think that this was the plan all along. I think they
         | saw how SVB went down and realize that if they're reckless and
         | irresponsible at a big enough scale they can get the government
         | to just transfer money to them. It's almost like this is their
         | new business model "we're selling exposure to the $XX trillion
         | dollar bailout industry."
        
           | ignoramous wrote:
           | > _They really are shameless aren 't they? Makes one think
           | that this was the plan all along._
           | 
           | Not really. Sundar is still pretty bullish on GenAI, just not
           | the investor excitement around it (bubble).
           | Pichai described AI as "the most profound technology"
           | humankind has worked on. "We will have to work through
           | societal disruptions," he said, adding that the technology
           | would "create new opportunities" and "evolve and transition
           | certain jobs." He said people who adapt to AI tools "will do
           | better" in their professions, whatever field they work in.
        
             | gizajob wrote:
             | Yeah the profundity of the slop churned out by Sora is
             | really something to behold. Veritably the pinnacle of
             | millennia of human art and creativity.
        
           | estimator7292 wrote:
           | I don't think it's very difficult to imagine that the usgov
           | is trying to put pressure on industry to make "number go up".
           | Given the general competency level in usgov these days, I
           | also wouldn't be particularly surprised if nobody knew or
           | cared about whether the "up" of the number was real or
           | meaningful, or whether there would be consequences.
           | 
           | Current admin really, _really_ wants the number going up, and
           | is also incapable of considering or is ignorant to any notion
           | of consequence for any actions of any kind.
        
             | 0cf8612b2e1e wrote:
             | This is the thing that worries me the most. The market is
             | past due for a market correction. Yet this government is
             | willing to burn down everything for short term gains.
        
         | zdragnar wrote:
         | Hasn't it been pretty widely acknowledged that AI funding has
         | created a whirlpool of money cycling between a few players-
         | cloud / datacenter hosts / operators (oracle), GPU (nvidia) and
         | model operators (openai).
         | 
         | To pile on, there's hardly a product being developed that
         | doesn't integrate "ai" in some way. I was trying to figure out
         | why my brand new laptop was running slowly, and (among other
         | things) noticed 3 different services running- microsoft
         | copilot, microsoft 365 copilot (not the same as the first,
         | naturally) and the laptop manufacturer's "chat" service. That
         | same day, I had no fewer than 5 other programs all begging me
         | to try their AI integrations.
         | 
         | Job boards for startups are all filled with "using AI" fluff
         | because that's the only thing investors seem to want to put
         | money into.
         | 
         | We really are all dirty here.
        
       | lesuorac wrote:
       | > He told the BBC that the company owns what he called a "full
       | stack" of technologies, from chips to YouTube data to models and
       | frontier science research. This integrated approach, he
       | suggested, would help the company weather any market turbulence
       | better than competitors.
       | 
       | I guess but is it better for an investor to own 2 shares of
       | Google or 1 share of OpenAI and 1 share of TSMC?
       | 
       | Like I have no doubt that being vertically integrated as a single
       | company has lot of benefits but one can also create a trust that
       | invests vertically as well.
        
         | jmalicki wrote:
         | There may be firm specific risk etc., but there is also a
         | concept of double marginalization, where monopolies that exist
         | across the vertical layers of a production chain will be less
         | efficient than a single monopoly, because you only get a single
         | layer of dead weight loss rather than multiple.
         | 
         | https://en.wikipedia.org/wiki/Double_marginalization?wprov=s...
        
         | pphysch wrote:
         | OpenAI going poof would have a negative impact on TSMC demand
         | (revenue), right?
        
           | wmf wrote:
           | Yeah, TSMC demand might go down from 300% to 100%.
        
             | jaennaet wrote:
             | So yes, it would have an effect; even with your imaginary
             | numbers that'd be a 3x drawdown
        
               | convolvatron wrote:
               | it might bring in the schedules, but since it probably
               | wouldn't cause there to be an actual hole, its really
               | more about long term fab build plans than anything else
        
               | JumpCrisscross wrote:
               | > _since it probably wouldn 't cause there to be an
               | actual hole, its really more about long term fab build
               | plans than anything else_
               | 
               | Equities are forward looking. TSMC's valuation doesn't
               | make sense if it doesn't have a backlog to grow into.
        
         | nradov wrote:
         | OpenAI is privately held. Regular retail investors can't buy
         | shares.
        
         | boringg wrote:
         | Well if AI goes poof - the equity markets take a really big bad
         | hit. So I would probably move out of equity and into something
         | more concrete and reinvest if you can time the market bottom.
         | 
         | Nvidia earnings tomorrow will be the litmus test if things are
         | going to topple over.
        
       | ghostpepper wrote:
       | Does anyone really think it's "if" and not "when" ?
        
         | burnte wrote:
         | Agreed, it's when. They're hoping to stave it off or maybe
         | stretch out the pop into a correction by all hedging together
         | with all these incestuous deals, but you can't hold back the
         | tide. They debuted this tech way too early, promised way too
         | much, and now the market is wary about buying AI products until
         | more noise settles out of the system.
        
           | ares623 wrote:
           | It's going to pop as soon as they get confirmation the govt
           | will bail them out. Until then they're going to give it their
           | all to keep it growing.
        
             | pksebben wrote:
             | I think they already have that confirmation. When we bailed
             | the banks out in 08 we basically said "If you're big enough
             | that we'd be screwed without you then take whatever risks
             | you like with impunity".
             | 
             | That's a reduction of complexity, of course, but the core
             | of the lesson is there. We have actually kept on with all
             | the practices that led to the housing crash (MBS, predatory
             | lending, Mixing investment and traditional banking).
        
               | n8cpdx wrote:
               | > If you're big enough that we'd be screwed without you
               | then take whatever risks you like with impunity".
               | 
               | I know financially it will be bad because number not go
               | up and number need go up.
               | 
               | But do we actually depend on generative/agentic AI at all
               | in meaningful ways? I'm pretty sure all LLMs could be
               | Thanos snapped away and there would be near zero material
               | impact. If the studies are at all reliable all the
               | programmers will be more efficient. Maybe we'd be better
               | off because there wouldn't be so much AI slop.
               | 
               | It is very far from clear that there is any real value
               | being extracted from this technology.
               | 
               | The government should let it burn.
               | 
               | Edit: I forgot about "country girls make do". Maybe gen
               | AI is a critical pillar of the economy after all.
        
               | pksebben wrote:
               | I expect the downvotes to come from this as they always
               | seem to do these days, but I know from my personal
               | experience that there is value in these agents.
               | 
               | Not so much for the work I do for my company, but having
               | these agents has been a fairly huge boon in some specific
               | ways personally:
               | 
               | - search replacement (beats google almost all of the
               | time)
               | 
               | - having code-capable agents means my pet projects are
               | getting along a lot more than they used to. I check in
               | with them in moments of free time and give them large
               | projects to tackle that will take a while (I've found
               | that having them do these in Rust works best, because it
               | has the most guardrails)
               | 
               | - it's been infinitely useful to be able to ask questions
               | when I don't know enough to know what terms to search
               | for. I have a number of meatspace projects that I didn't
               | know enough about to ask the right questions, and having
               | LLMs has unblocked those 100% of the time.
               | 
               | Economic value? I won't make an assessment. Value to me
               | (and I'm sure others)? Definitely would miss them if they
               | disappeared tomorrow. I should note that given the state
               | of things (large AI companies with the same shareholder
               | problems as MAANG) I do worry that those use cases will
               | disappear as advertising and other monetizing influences
               | make their way in.
               | 
               | Slop is indeed a huge problem. Perhaps you're right that
               | it's a net negative overall, but I don't think it's
               | accurate to say there's not any value to be had.
        
               | s1mplicissimus wrote:
               | I'm glad you had positive experiences using this specific
               | technology.
               | 
               | Personally, I had the exact opposite experience: Wrong,
               | deceitful responses, hallucinations, arbitrary pointless
               | changes to code... It's like that one junior I requested
               | to be removed from the team after they peed in the
               | codebase one too many times.
               | 
               | On the slop i have 2 sentiments: Lots of slop = higher
               | demand for my skills to clean it up. But also lots of
               | slop = worse software on probably most things, impacting
               | not just me, but also friends, family and the rest of
               | humanity. At least it's not only a downside :/
        
               | thewebguyd wrote:
               | > I'm pretty sure all LLMs could be Thanos snapped away
               | and there would be near zero material impact.
               | 
               | I mostly agree, but I don't think it's the model
               | developers that would get bailed out. OpenAI & Anthropic
               | can fail, and should be let to fail if it comes to that.
               | 
               | Nvidia is the one that would get bailed out. As would
               | Microsoft, if it came to that.
               | 
               | I also think they should be let to fail, but there's no
               | way the US GOV ever allows them to.
        
               | exasperaited wrote:
               | Which of these firms is too big to fail though?
               | 
               | It all depends on whether MAGA survives as a single
               | community. One of the few things MAGA understands
               | correctly is that _AI is a job-killer_.
               | 
               | Trump going all out to rescue OpenAI or Anthropic doesn't
               | feel likely. Who actually needs it, as a dependency? Who
               | can't live without it? Why bail out entities you can
               | afford to let go to the wall (and maybe then corruptly
               | buy out in a fire sale)?
               | 
               | Similarly, can you actually see him agreeing to bail out
               | Microsoft without taking an absurd stake in the business?
               | MAGA won't like it. But MS could be broken up and sold;
               | every single piece of that business has potential buyers.
               | 
               | Nvidia, now that I can see. Because Trump is surrounded
               | by crypto grifters and is dependent on crypto for his
               | wealth. GPUs are at least real solid products and Nvidia
               | still, I think, make the ones the crypto guys want.
               | 
               | Google, you can see, are getting themselves ready to
               | _not_ be bailed out.
        
               | Capricorn2481 wrote:
               | > One of the few things MAGA understands correctly is
               | that AI is a job-killer
               | 
               | Trump (and by extension MAGA) has the worst job growth of
               | any President in the past 50 years. I don't think that's
               | their brand at all. They put a bunch of concessions to AI
               | companies in the Big Beautiful Bill, and Trump is not
               | running again. He would completely bail them out, and
               | MAGA will believe whatever he says, and congress will
               | follow whatever wind is blowing.
        
               | bigbuppo wrote:
               | If Meta or Google disappared overnight, it would be, at
               | worst, a minor annoyance for most of the world. Despite
               | the fact that both companies are advertising behemoths,
               | marketing departments everywhere would celebrate their
               | end.
        
               | lazide wrote:
               | Considering how much of the world runs on WhatsApp alone,
               | that's laughably wrong.
        
               | diroussel wrote:
               | So if WhatsApp had an outage, but you needed to
               | communicate to someone, you wouldn't be able to? Don't
               | you have contacts saved locally, and other message apps
               | available?
        
               | lazide wrote:
               | In most of Asia, Latin America, Africa, and about half of
               | Europe?
               | 
               | You'd be pretty stuck. I guess SMS might work, but it
               | wouldn't for most businesses (they use the WhatsApp
               | business functionality, there is no SMS thing backing
               | it).
               | 
               | Most people don't even use text anymore. China has it's
               | own Apps, but everyone else uses WhatsApp exclusively at
               | this point.
        
               | hermanzegerman wrote:
               | Nobody uses WhatsApp Business in Germany, Austria or
               | Switzerland in a way that you would be stuck without
        
               | hermanzegerman wrote:
               | Then they would just use another Messenger or fall back
               | on RCS/SMS.
               | 
               | The only reason WhatsApp is so popular, is because so
               | many people are on it, but you have all you need (their
               | phone number) to contact them elsewhere anyway
        
               | NicoJuicy wrote:
               | Watching this on my Android on a chrome browser.
               | 
               | Hard disagree
        
           | project2501a wrote:
           | They got enough slush money to make this go on for a couple
           | of years.
           | 
           | I am shocked at the part they know it is a bubble and they
           | are doing nothing to amortize it. Which means they expect the
           | government to step in and save their butts.
           | 
           | ... Well, not that shocked.
        
             | bigbuppo wrote:
             | They're floating 40 year bonds for technology with a three
             | year lifecycle. They do not have the actual cash for this.
        
           | dylan604 wrote:
           | > They debuted this tech way too early, promised way too
           | much,
           | 
           | finally, some rational thought into the AI insanity. The
           | entire 'fake it til you make it' aspect of this is
           | ridiculous. sadly, the world we live in means that you can't
           | build a product and hold its release until it works. you have
           | to be first to release even if it's not working as
           | advertised. you can keep brushing off critiques with "it's on
           | the road map". those that are not as tuned in will just think
           | it is working and nothing nefarious is going on. with as long
           | as we've had paid for LLM apps, I'm still amazed at the
           | number of people that do not know that the output is still
           | not 100% accurate. there are also people that use phrases as
           | thinking when referring to getting a response. there's also
           | the misleading terms like "searching the web..." when on this
           | forum we all know it's not a live search.
        
             | burnte wrote:
             | > sadly, the world we live in means that you can't build a
             | product and hold its release until it works. you have to be
             | first to release even if it's not working as advertised.
             | 
             | You absolutely can and it's an extremely reliable path to
             | success. The only thing that's changed is the amount of
             | marketing hype thrown out by the fake-it vendors. Staying
             | quiet and debuting a solid product is still a big win.
             | 
             | > I'm still amazed at the number of people that do not know
             | that the output is still not 100% accurate.
             | 
             | This is the part that "scares" me. People who do not
             | understand the tool thinking they're ACTUALLY INTELLIGENT.
             | Not only are they not intelligent, they're not even
             | ACTUALLY language models because few LLMs are actually
             | trained on only language data and none work on language
             | units (letters, words, sentences), tokens are abstractions
             | from that. They're OUTPUT modelers. And they're absolutely
             | not even close to being let loose unattended on important
             | things. There are already people losing careers over AI
             | crap like lawyers using AI to appeal sanctions because they
             | had AI write a motion. Etc.
             | 
             | And I think that was ultimately the biggest unforced error
             | of these AI companies and the ultimate reason for the
             | coming bubble crash. They didn't temper expectations at
             | all, the massive gap between expectation and reality is
             | already costing companies huge amounts of money, and it's
             | only going to get worse. Had they started saying, "these
             | work well, but use them carefully as we increase
             | reliability" they'd be in a much better spot.
             | 
             | In the past 2 years I've been involved in several projects
             | trying to leverage AI, and all but one has failed. The most
             | spectacular failure was Microsoft's Dragon Copilot. We
             | piloted it with 100 doctors, after a few months we had a
             | 20% retention rate, and by the end of a year, ONE doctor
             | still liked it. We replaced it with another tool that
             | WORKS, docs love it, and it was 12.6% the cost, literally a
             | sixth the price. MS was EXTREMELY unhappy we canceled after
             | a year, tried to throw discounts at us, but ultimately we
             | had to say "the product does not work nearly as well as the
             | competition."
        
         | Zaskoda wrote:
         | Sort of? My thoughts are that there's something of an AI arms
         | race and the US doesn't want to lose that race to another
         | country... so if the AI bubble pops too fiercely, there may
         | likely be some form of intervention. And any time the
         | government intervenes, all bets are off the table. Who knows
         | what they will do and what the impact will be.
        
           | nitwit005 wrote:
           | I can see them intervening to preserve AI R&D of some sort,
           | but many of the current companies are running consumer
           | oriented products. Why care if some AI art generation website
           | goes bust?
        
         | nicce wrote:
         | More like that when it happens, how big the pop is.
        
           | tetris11 wrote:
           | It'll be fine. When the banks burst in 2008, they were gifted
           | 7 trillion to make up the shortfall and life went on for the
           | rich.
           | 
           | This time they'll be gifted 70 trillion to make up for the
           | shortfall, and life shall continue on for the rich.
           | 
           | It's win-win for them, there's no risk at all
        
             | cjbgkagh wrote:
             | I think the economic background has changed, in 2008 it was
             | after a big run up in wealth so the reversion wasn't so
             | bad, there was some fat to cut. Since then people have been
             | ground down to the breaking point, another 2008 wipeout
             | will cut into the bone. I do think this time it could be
             | different.
        
             | jghn wrote:
             | privatize profit, socialize risk. same as it always was
        
             | gizajob wrote:
             | The money system breaking is one thing, companies that
             | build chatbots going to the wall is another.
        
           | TulliusCicero wrote:
           | It's also possible it'll be more of a deflation than a pop.
           | 
           | That's what I'm personally hoping for anyway, would rather
           | the economy avoid a big recession.
        
             | mrguyorama wrote:
             | Without AI bubble the economy is already mostly in a
             | recession.
        
               | TulliusCicero wrote:
               | Without the AI bubble, most of that money would probably
               | still flow to some other sector of the economy. It
               | wouldn't just disappear.
        
               | kazen44 wrote:
               | which is kind of sad to think about. The US could have
               | invested all that money to actually invest in its
               | infrastructure, schools, hospitals and general wellbeing
               | of its workforce to make the economy thrive.
        
         | techblueberry wrote:
         | I've been trying to grok this idea of - when does a bubble pop.
         | Like in theory if everyone knows it's a bubble, that should
         | cause it to pop, because people should be making their way to
         | the exists, playing music chairs to get their money out early.
         | 
         | But as I try to sort of narrative the ideas behind bubbles and
         | bursts, one thing I realize, is that I think in order for a
         | bubble to burst, people essentially have to want it to burst(or
         | the opposite have to want to not keep it going).
         | 
         | But like Bernie Madoff got caught because he couldn't keep
         | paying dividends in his ponzi scheme, and people started
         | withdrawing money. But in theory, even if everyone knew, if no
         | one withdrew their money (and told the FCC) and he was able to
         | use the current deposits to pay dividends a few years. The
         | ponzi scheme didn't _have_ to end, the bubble didn't have to
         | pop.
         | 
         | So I've been wondering, like if everyone knows AI is a bubble,
         | what has to happen to have it collapse? Like if a price is what
         | people are willing to pay, in order for Tesla to collapse,
         | people have to decide they no longer want to pay $400 for Tesla
         | shares. If they keep paying $400 for tesla shares, then it will
         | continue to be worth $400.
         | 
         | So I've been trying to think, in the most simple terms, what
         | would have to happen to have the AI bubble pop, and basically,
         | as long as people perceive AI companies to have the biggest
         | returns, and they don't want to move their money to another
         | place with higher returns (similar to TSLA bulls) then the
         | bubble won't pop.
         | 
         | And I guess that can keep happening as long as the economy
         | keeps growing. And if circular deals are causing the stock
         | market to keep rising, can they just go on like this forever?
         | 
         | The downside of course being, the starvation of investments in
         | other parts of the economy, and giving up what may be better
         | gains. It's game theory, as long as no one decides to stop
         | playing the game, and say pull out all their money and put it
         | into I dunno, bonds or GME, the music keeps playing?
        
           | AstroBen wrote:
           | Eventually money to invest will run out. If earnings of the
           | companies doesn't catch up we'll reach a situation where
           | stock prices reach a peak, have limited future expected
           | returns, and then it'll pop when there's a better opportunity
           | for the money
           | 
           | Imagine if interest rates go up and you can get 5% from a
           | savings account. One big player pulls out cash triggering a
           | minor drop in AI stocks. Panic sells happen trying to not be
           | the last one out of the door, margin calls etc.
           | 
           | You're assuming cash will never stop flowing in driving up
           | prices. It will. The only way it goes on forever is if the
           | companies end up being wildly profitable
        
           | JumpCrisscross wrote:
           | > _when does a bubble pop_
           | 
           | This one? When China commits to subsidising and releasing
           | cutting-edge open-source models. What BYD did to Tesla's FSD
           | fee dreams, Beijing could do to American AI's export
           | ambitions.
        
           | wavemode wrote:
           | It's important to keep in mind the difference between the
           | stock market and the economy.
           | 
           | Economically, AI is a bubble, and lots of startups whose
           | current business model is "UI in front of the OpenAI API" are
           | likely doomed. That's just economic reality - you can't run
           | on investor money forever. Eventually you need actual
           | revenue, and many of these companies aren't generating very
           | much of it.
           | 
           | That being said, most of these companies aren't publicly
           | traded right now, and their demise would currently be
           | unlikely to significantly affect the stock market.
           | Conversely, the publicly traded companies who are currently
           | investing a lot in AI (Google, Apple, Microsoft, etc) aren't
           | dependent on AI, and certainly wouldn't go out of business
           | over it.
           | 
           | The problem with the dotcom bubble was that there were a lot
           | of publicly traded companies that went bankrupt. This wiped
           | out trillions of dollars in value from regular investors.
           | Doesn't matter how much you may irrationally want a bubble to
           | continue - you simply can't stay invested in a company that
           | doesn't exist anymore.
           | 
           | On the other hand, the AI bubble bursting is probably going
           | to cost private equity a lot of money, but not so much
           | regular investors unless/until AI startups (startups
           | dependent on AI for their core business model) start to go
           | public in large numbers.
        
             | whattheheckheck wrote:
             | I think the targeted ad revenue all of the llm providers
             | will get using everyones regular chat data + credit card
             | dataset for training is going to be insanely good.
             | 
             | Plus the information they can provide to the State on the
             | sentiment of users is also going to be greatly valued
        
               | techblueberry wrote:
               | Didn't perplexity make only like 27K from ad revenue?
               | They're going to have to actively compete with Google and
               | Facebook dollars, as google and facebook develop
               | competing products.
        
       | burnte wrote:
       | And there we have the reason for all of these interdependent
       | deals between all these firms, they're all hedging with each
       | other they can keep this set of plates spinning.
       | 
       | They can't, not firever. Bubbles pop.
        
         | nickff wrote:
         | How is what they're doing a 'hedge'? It seems more like
         | alternative financing, or keiretsu.
        
       | viccis wrote:
       | Very cool and healthy for the CEO of a company investing massive
       | amounts into a given technology to casually refer to it as a
       | "bubble" at the same time. I guess he softens the statement a bit
       | by calling it "an AI bubble" instead of the "the AI bubble", but
       | it's still interesting to see everyone involved in this economic
       | mess start to acknowledge it.
        
         | TulliusCicero wrote:
         | Unironically agreed that it's good for a CEO to remain
         | relatively level headed and clear eyed.
         | 
         | The comparison made to the dotcom bubble is apt. It was a
         | bubble, but that didn't mean that all the internet and
         | e-commerce ideas were wrong, it was more a matter of investing
         | too much too early. When the AI bubble pops or deflates,
         | progress on AI models will continue on.
        
       | sgroppino wrote:
       | It's not a bubble until it bursts
        
         | barbazoo wrote:
         | Gave our kids a bath last night, can confirm, a bubble is a
         | bubble even before it pops.
        
       | jmount wrote:
       | Tons of companies survived the dot com bubble pop. Corrections
       | are when the market does some sorting.
        
         | estimator7292 wrote:
         | Wow, this is such a unique and beautiful insight literally
         | nobody has ever heard before. Good job!
        
           | gizajob wrote:
           | 10x more useful than your retort.
        
       | giancarlostoro wrote:
       | I think it will pop but not in the way everyone thinks it will
       | pop. There's plenty that's not going to go away / anywhere, but
       | I'm sure lots of startups will fail and close their doors.
        
         | hypeatei wrote:
         | What way do you envision it popping? Nvidia has tons of
         | investments on their books in smaller companies. If a couple of
         | them start showing poor earnings, it could cause a death spiral
         | for NVDA because 1) their investment just tanked, and 2) those
         | companies are no longer buying chips from them therefore
         | reducing revenue.
         | 
         | Nvidia also makes up ~7% of the S&P 500 so if their stock price
         | falls substantially, that's a big chunk of capital just... gone
         | for a lot of people.
        
       | scottLobster wrote:
       | Silicon Valley! Unprofitable debt and marketing all the way up
       | until you get bailed out by the taxpayers, apparently.
        
         | Barrin92 wrote:
         | I'm not seeing that happening. Unlike banking and housing
         | there's not much systemic or political risk in letting these
         | companies crash. It's mostly going to hit a very small number
         | of high net worth people who don't have a lot of clout and are
         | oddly disconnected from the rest of the economy.
        
           | bogomipz wrote:
           | This is incorrect. A lot of these companies are raising debt
           | to pay for these datacenter build outs. And that debt has
           | already been sold to pension funds. The risk has already been
           | spread. See Blue Owl Capital and how Meta is financing its
           | Hyperion datacenter. They raised 30 billion in debt. Main
           | street is already exposed as those bonds are in funds offered
           | by the usual players BlackRock, Invesco, Pimco etc.
        
           | scottLobster wrote:
           | Virtually everyone's 401k is overexposed to these companies
           | due to their insane market caps and the hype around them. If
           | they go every S&P 500 and total US market ETF goes with them,
           | right as the Boomers start retiring en-masse.
           | 
           | Even Vanguard's Total World Index, VT, is roughly 15% MAG 7.
           | 
           | That's not even getting into who's financing whom for what
           | and to whom that debt may be sold to.
        
       | rchaud wrote:
       | Most bubbles occur due to excessive levels of credit offered too
       | cheaply, resulting in a whole bunch of defaults happening at the
       | same time. All the major AI players have borrowed money to buy
       | GPUs and build data centers and have used Special Purpose
       | Vehicles to do it so the debt doesn't fall on their own balance
       | sheet, probably using a certain amount of stock as collateral. If
       | the SPV defaults, could that trigger a big sell-off?
        
         | vineyardmike wrote:
         | The question is, a sell off for who?
         | 
         | If they've securitized and sold their data center buildout,
         | will the big clouds and AI labs actually face any severe
         | impact? While the sums are huge, most of these companies have
         | the cash on hand to pay down the debt. The big AI labs have
         | said their models earn enough to cover the cost to train
         | themselves, just not the next one. This means they could at any
         | time walk away from the compute spend for training.
         | 
         | With the heavy securitization of all these deals, will the
         | "bubble pop" just hurt the financial industry?
         | 
         | If a company like CoreWeaver sees their SPV for a Microsoft-
         | specific data center go bankrupt, that means MSFT decided to
         | walk away from the deal. Red flag for the industry, but also a
         | sign of fiscal restraint. Someone else can swoop in and buy the
         | DC for cheap, while MSFT avoids the Opex hit. Seems like the
         | losers will be whoever bought that SPV debt, which probably
         | isn't a tech company.
        
           | Irishsteve wrote:
           | It's an insurance company so basically pensions.
        
             | nradov wrote:
             | Right, insurance companies are the new "financial dark
             | matter". The next financial crisis will probably be
             | triggered when a few large life and property insurers fail
             | because they purchased debt assets which were highly rated
             | but turn out to be junk. (Medical and auto insurers aren't
             | exposed here because they operate on much shorter
             | timeframes.)
        
             | JumpCrisscross wrote:
             | > _It's an insurance company_
             | 
             | What is?
        
       | badgersnake wrote:
       | Every CEO is reading from the same script right now. It might be
       | a bubble but it's just like the internet, it's still going to be
       | relevant and it's just the crap companies and grifters who will
       | die.
       | 
       | I wonder who's writing the script.
        
       | partiallypro wrote:
       | I think AI is a bubble, but I don't think we're close to the peak
       | yet.
        
         | hylaride wrote:
         | Ever literally blow bubbles? You never really know how big each
         | one will be.
         | 
         | My biggest worry is that what will be left standing after all
         | of this is the organizations that are quietly all the AI slop
         | everywhere, be it the normal web or YouTube.
        
       | helterskelter wrote:
       | I'm curious what HN is doing with their portfolios right about
       | now. I'd be dumping NVDA and reallocating to more bonds for the
       | time being.
        
         | josefritzishere wrote:
         | This sub is the most important question in the thread. Where do
         | you put your money to hedge against an AI market crash?
        
           | hirako2000 wrote:
           | Commodities.
        
           | ajross wrote:
           | You _can 't_ hedge against a whole market. And you can't time
           | bubble pop events anyway. You can dump NVDA today, sure,
           | because it's overvalued at $180. And most of us agree. But
           | that won't prevent it from going to $300 before it pops
           | (which is totally reasonable too!), so dumping it today might
           | hurt as much as it helps. Run-ups at the end of a speculative
           | bubble are by definition irrational and produce in-hindsight-
           | ridiculous numbers.
           | 
           | If you're young and invested for the long term, just leave
           | all your junk in broad index securities. You can't do better
           | than that, you just have to ride the bumps.
           | 
           | On the other hand, I'm approaching retirement and looking
           | seriously at when to pull the trigger. The aggregate downside
           | _to me_ of a large market drop or whatever is much higher
           | than it is to a 20-something, because losing out on (to make
           | a number up) an extra 30% of net worth is minor when compared
           | to  "now you have to work another three years before
           | retiring" (or alternate framings like "you have to retire in
           | Houston and not Miami", etc...).
           | 
           | So most of my assets are moving out of volatiles entirely.
        
             | _zoltan_ wrote:
             | into? bonds?
        
               | ajross wrote:
               | A few bond funds, but frankly just a lot of money market
               | cash in the short term. Most of our guts say that the
               | crash is imminent and if it is the extra fees and hassle
               | won't be worth it.
        
           | oulipo2 wrote:
           | Cash or bonds I assume
        
           | nradov wrote:
           | In a crash everything gets positively correlated for a while.
           | You can go to cash temporarily but of course no one can
           | consistently time the market.
        
           | coldpie wrote:
           | Same thing as always. Stick with your plan and rebalance if
           | you need to. If your plan is 80% stock 20% bond (or whatever
           | ratios), and the increased stock prices are putting you
           | significantly out of balance, then sell your stock funds and
           | buy bonds to put it back to where it should be. If the crash
           | happens, sell your now too-high bonds and buy stocks. Or just
           | buy into one of those funds that does all this for you, or
           | hire a fiduciary financial advisor to do it for you.
        
           | hylaride wrote:
           | With even the SP500 being super concentrated in AI-exposed
           | companies, probably a combination of bonds and foreign
           | equities. But hedging does mean being OK with watching any
           | (perceived or real) bubble madness continue. I wanted to put
           | all my wealth into Apple circa 2005, but chose not to because
           | blah blah blah diversification. Obviously I wish I did, but
           | I'm ok with the perfectly sensible decision I made - and I'd
           | be retired many times over had I done it.
           | 
           | Personally speaking, as somebody that was 100% in equities
           | until earlier this year (I'm in my early 40s and had most of
           | my wealth in VOO), I shifted to a 60-40 portfolio - there are
           | ETFs that maintain the balance for you. I did this knowing
           | full well that this could attenuate my upside, but I figured
           | it's worth it than being so concentrated in a single part of
           | an industry (AI within tech) and so much upside was already
           | acquired up until that point. Also, I figured the chances of
           | the 2nd Trump term adding to volatility weren't going to help
           | tamper volatility. On top of that, my income is tied to tech,
           | so diversifying away further from it is sensible (especially
           | the equity parts of my compensation).
           | 
           | But if you're in your 20s, your nest egg is likely small
           | enough that I'd just continue plugging away in automatic
           | contributions. Investing at all is far more important than
           | anything else at that stage.
        
           | mrtesthah wrote:
           | AAPL is chronically undervalued, and at the same time derives
           | no revenue from generative AI.
        
           | ndriscoll wrote:
           | Do you live in a home you own with no mortgage? Do you have a
           | fully electrified home, only EVs, and enough solar to run
           | those things? You can make real concrete capital investments
           | instead of abstract financial ones to reduce your required
           | living/"operating" expenses, insulating you somewhat from the
           | state of financial markets.
        
             | Anonyneko wrote:
             | This doesn't seem to work very well in economies where
             | housing isn't constantly appreciating like crazy (I'm not
             | from the US)...
        
               | ndriscoll wrote:
               | It does if you're paying for that housing (either rent or
               | mortgage payments). People invest into stocks while
               | simultaneously holding a liability (e.g. they need to
               | somehow come up with payments to continue living
               | somewhere, or to continue having heating/cooling/lights).
               | If you think all of the financial investments available
               | to you might crash, and your source of income may
               | evaporate in a correlated event, you can instead put all
               | of your money into minimizing your liabilities. The goal
               | is not to see your home value increase--you're not trying
               | to sell it. It's to secure everything you need to have
               | the standard of living you want by _owning_ those things.
        
           | eqvinox wrote:
           | Land/housing/property, as directly as possible and
           | reasonable. Just make sure you don't do it in an overheated
           | place like New York.
        
             | JumpCrisscross wrote:
             | > _Just make sure you don 't do it in an overheated place
             | like New York_
             | 
             | If the stock market crashes, New York property probably
             | sings. Stock market crash means ZIRP. And ZIRP means lots
             | of money sloshing through New York.
        
               | eqvinox wrote:
               | > lots of money sloshing through New York.
               | 
               | That's kinda the problem, I'd expect it to be a bit...
               | volatile. I guess it's a valid target to gamble on if
               | that matches your risk profile.
        
               | JumpCrisscross wrote:
               | > _I 'd expect it to be a bit... volatile_
               | 
               | Technically yes, but only because something monotonically
               | increasing in price is volatile.
        
           | TrainedMonkey wrote:
           | It's more complex than that, a summary of my highly
           | subjective understanding:
           | 
           | 1. AI companies manage to build AGI and achieve takeoff. I
           | have no idea on how to hedge against that.
           | 
           | 2. The market is not allowed to crash. There will likely be
           | some lag between economic weakness and money printing. Safer
           | option is probably to buy split 50% SPY and 50% bonds. A
           | riskier option is trying to time the market.
           | 
           | 3. The market is allowed to crash. Bonds, cash, etc.
           | 
           | Depending on what you believe will happen and risk appetite
           | you can blend between the strategies or add a short
           | component. I am holding #2 with no short positions in post-
           | tax accounts and full SPY in tax advantaged accounts.
        
           | dabockster wrote:
           | US government bonds
        
         | nurettin wrote:
         | Why trade individual stocks anyway? Cost averaging ETFs is a
         | proven way to building wealth. S&P goes down 20%, you average
         | down, it recovers and you get another 2-3 years of growth. This
         | goes on until civilization collapses.
        
           | gretch wrote:
           | If you buy ETFs, you basically hold some stocks you don't
           | want.
           | 
           | For example, stock from war profiteering companies (lockheed,
           | raytheon).
           | 
           | Note that investing in war profiteers is a proven way to
           | build wealth. I just don't want to do that.
           | 
           | This argument not only applies to evil companies, but also
           | dumb ones. For example, I have no interest in investing in
           | IBM or Oracle even those both of those are also money makers.
        
             | lazide wrote:
             | Ok?
        
             | miloignis wrote:
             | You could buy ETFs and then short the stocks you don't like
             | more, I suppose.
        
           | nradov wrote:
           | Buying index funds (either mutual funds or ETFs) has been an
           | effective approach for retail investors. But the concern now
           | is that some US stock index funds are so heavily weighted to
           | the "Magnificent 7" stocks that much of the previous benefit
           | of diversification has been lost. The Mag 7 are all highly
           | correlated with each other so if one falls then usually the
           | others do as well.
           | 
           | https://www.fidelity.com/learning-center/smart-
           | money/magnifi...
           | 
           | There are other index funds which are equal weighted rather
           | than market weighted. Those have underperformed lately but
           | might be less volatile if the AI bubble pops.
        
             | prism56 wrote:
             | I'm in a global tracker and the sheet amount in these big
             | stocks is scary.
        
         | AstroBen wrote:
         | Broad, global diversification with a long term time horizon. So
         | I'm doing exactly nothing
         | 
         | I'm not able to predict what the overall market is going to do
         | short or medium term
         | 
         | What makes you think your guess is better than the rest of the
         | money in the market, most of it acting with better information
         | than you?
        
         | boringg wrote:
         | Theres a really funny thing going on right now -- in that
         | everyone is forecasting an AI bubble to pop. It feels like
         | every single human is saying that from the heads of tech
         | companies with comments that are veiled to bankers and everyone
         | on the street.
         | 
         | It reminds me of the time that everyone said the economy was
         | going to tank and somehow everyone had it wrong a couple years
         | ago.
         | 
         | It feels implausible that it isn't overbuilt but it also feels
         | really strange for everyone to be pushing this narrative that
         | its a bubble - and people taking very public short bets. It
         | feels like the contrarian bet is that its going to keep running
         | hot. Nvidia earnings tommorrow big litmus test.
        
           | HarHarVeryFunny wrote:
           | If it was the people actually investing in AI all saying it's
           | a bubble, implying that they are holding back, not all-in,
           | for fear of it crashing, then it'd have room to run further
           | (until they were all-in, and leveraged to the eyeballs, cf
           | subprime housing crash liar loans, dot-com crash investor
           | margin accounts).
           | 
           | However, it seems more like the people pumping billions into
           | AI are all still "this is going to the moon" gung-ho, and
           | unless they are investing billions of CASH, then I guess they
           | are borrowing to do so.
           | 
           | I don't know how this financing works - maybe no fear of
           | having it pulled like a foreclosure on a subprime mortgage
           | holder, or a broker margin call, but it's not going to end
           | well if these investments start to fail and the investors
           | start running for the door.
           | 
           | Peter Thiel's recent exit from NVidia should be a bit
           | concerning given his good record on macro bets and timing.
        
         | officeplant wrote:
         | Currently? Wishing there was an S&P 500 that banned tech
         | stocks.
        
           | cschmidt wrote:
           | There are equal weight S&P ETFs, which avoid having a handful
           | of stock dominating. However, they do have to do a lot more
           | rebalancing to keep things in line.
        
           | MontyCarloHall wrote:
           | The SPXT [0]/XMAG [1] ETFs are exactly what you're looking
           | for.
           | 
           | [0] https://www.proshares.com/our-etfs/strategic/spxt (S&P
           | minus tech stocks)
           | 
           | [1] https://www.defianceetfs.com/xmag/ (S&P minus
           | "Magnificent 7")
        
             | officeplant wrote:
             | Welp, time to see if my 401k provider supports them.
        
       | binary132 wrote:
       | if only there were some way for THE ENTIRE MARKET to not have
       | quite so much exposure to hype bubbles
        
       | OptionOfT wrote:
       | Interestingly I think if the AI succeed at the level that a lot
       | of these CEOs hope we're not much better off either.
       | 
       | And the sentiment that goes around is more: reduce the amount of
       | people needed to do the same amount of work:
       | 
       | https://www.theregister.com/2025/10/09/mckinsey_ai_monetizat...
       | 
       | > McKinsey says, while quoting an HR executive at a Fortune 100
       | company griping: "All of these copilots are supposed to make work
       | more efficient with fewer people, but my business leaders are
       | also saying they can't reduce head count yet."
       | 
       | The problem becomes that eventually all these people who are laid
       | off are not going to find new roles.
       | 
       | Who is going to be buying the products and services if no-one has
       | money to throw around?
        
         | jmkni wrote:
         | There's a karma element too
         | 
         | Maybe I can make things more efficient by getting rid of you
         | and replacing you with AI, but how long until my boss has the
         | same idea?
        
         | thewebguyd wrote:
         | > Who is going to be buying the products and services if no-one
         | has money to throw around?
         | 
         | The same people who are buying products and services right now.
         | Just 10% of the US population is responsible for nearly 50% of
         | consumption.
         | 
         | We are just going to bifurcate even more into the haves and
         | have-nots. Maybe that 10% now becomes responsible for 70+% of
         | consumption and everyone else is fighting for scraps.
         | 
         | It won't be sustainable and we need UBI. A bunch of unemployed,
         | hungry citizens with nothing left to lose is a combo that
         | equals violent revolution.
        
           | Eisenstein wrote:
           | I posit that the consumption is the problem.
        
           | ben_w wrote:
           | The top 10% income bracket of the US is broad enough to
           | include basically all US software developers, isn't it?
           | 
           | If all jobs evaporate, what does the economy look like when
           | just based on interest and dividend payments?
        
             | jimbokun wrote:
             | It looks like Mad Max.
        
             | thewebguyd wrote:
             | Pretty much yeah, I believe it's around $200k/year puts you
             | in that bracket.
             | 
             | If all jobs evaporate, then only asset owners will have
             | money to spend, everyone else is left to fight for scraps
             | so we either all die off or we get mad max.
        
             | stackskipton wrote:
             | Top 10% of households are 212k. Plenty of software
             | developers don't make that but if they have a spouse with
             | 70k job, they are in top 10%. However, many software jobs
             | are starting to be in HCOL so they probably don't feel like
             | they are in top 10%.
        
         | cedws wrote:
         | I don't even know what the selling point of AI is for regular
         | people. In the 60s it was possible for a man to work an
         | ordinary job, buy a house, settle down with a wife and support
         | two or three children. That's completely out of the realm of
         | reality for many young people now and the plummeting birth
         | rates show it.
         | 
         | The middle class have financially benefited very little from
         | the past 20+ years of productivity gains.
         | 
         | Social media is driving society apart, making people selfish,
         | jealous, and angry.
         | 
         | Do people really think _more_ technology is going to be the
         | path to a better society? Because to me it looks like the
         | opposite. It will just be used to stomp on ordinary people and
         | create even more inequality.
        
           | Avicebron wrote:
           | What's crazy is that people will jump all over themselves to
           | say "well you could totally live like that at a 1960s level"
           | like that's even a viable possibility today (in the US).
           | 
           | What's that about the falcon and the falconer? The center
           | cannot hold..
        
             | Retric wrote:
             | People do make it work in the US with tiny incomes and a
             | better standard of living than you'd see in a typical
             | 1960's household.
             | 
             | I know people raising a family of 4 on 1 income well below
             | the median wage without a collage degree. They do get
             | significant help from government assistance programs for
             | healthcare, but their lifestyle is way better off than what
             | was typical in the 1960's.
             | 
             | Granted they aren't doing this in a ultra expensive US
             | city, but on the flip side they're living in a huge for
             | 1960's 3 bedroom house with a massive backyard.
        
           | FloorEgg wrote:
           | To me this all just looks like a big frothy chemical reaction
           | playing out far beyond any one person's control.
           | 
           | With that view, many things oscillate over time, including
           | game theory patterns (average interaction intentions of win-
           | win, win-lose, lose-lose), and integration / mitosis (unions,
           | international treaties, civil wars),etc.
           | 
           | So my optimistic view is that inevitably we will get more
           | tech whether we want it or not, and it will probably make
           | things worse many for a while, but then it will
           | simultaneously enable and force a restructuring at some level
           | that starts a new cycle of prosperity. On the other side it
           | will be clear that all this tech directly enables a better
           | (more free, more diverse, more rewarding, more sustainable)
           | way of life.
           | 
           | I believe this because from studying history it seems this
           | pattern plays out over and over and over again to varying
           | degrees.
        
             | Eisenstein wrote:
             | When you say that this pattern plays out, can you be
             | specific?
        
               | FloorEgg wrote:
               | I don't have time to be precise, but I'll do my best to
               | be more specific.
               | 
               | New system better at organizing human behavior ->
               | increases prosperity -> more capacity for invention ->
               | new technologies disrupt power dynamics -> greed and
               | power-law dynamics tilt system away from broad prosperity
               | (most powerful switch from win-win to win-lose) ->
               | majority become unsatisfied with system -> economics
               | break down (too much debt, not enough education,
               | technology increasingly and disproportionately benefits
               | wealthy) -> trust break down -> average pattern of
               | behavior tilts towards lose-lose dynamics -> technology
               | keeps advancing -,> new technologies disrupt old power
               | structures -> restructuring of world-powr order at
               | highest levels (often through conflict) -> new system
               | established, incorporating lessons learned from the old
               | (more fair, more inclusive) -> trust reestablished, shift
               | back to win-win dynamics (cycle repeats)
               | 
               | In reality it's more messy than this. Also the
               | geographical location of this cycle and the central power
               | can move around. Some places may sit out one or more
               | cycles and get stuck.
        
             | jimbokun wrote:
             | Either that or the AI robots kill us all.
             | 
             | Could go either way.
        
             | gizajob wrote:
             | The majority of people are already doing "bullshit jobs"
             | and many of them know it too. Using AI to automate the
             | bullshit and capture the value leaves them with nothing.
             | 
             | The AI evangelists generally overlook that one of the
             | primary things that capitalism does is fill people's lives
             | with busywork, in part as an exercise in power and in
             | another part because if given their time back, those people
             | would genuinely have absolutely no idea what to do with it.
        
           | Demiurge wrote:
           | > In the 60s it was possible for a man to work an ordinary
           | job, buy a house, settle down with a wife and support two or
           | three children.
           | 
           | Every kind of a man, or woman?
           | 
           | > Do people really think more technology is going to be the
           | path to a better society? Because to me it looks like the
           | opposite.
           | 
           | Well, this probably why statistics exist.
        
             | Karrot_Kream wrote:
             | Yeah if you bar over 50% of your workforce from working at
             | market clearing wages then naturally the other 50% are
             | going to get paid at their expense. When you underpay
             | minorities and often outright ban women from working formal
             | employment, it's not hard to see how wages for the others
             | remain high.
        
               | jimbokun wrote:
               | Well congratulations! We have succeeded in having
               | stagnating wages and stagnating standard of living for
               | everyone now!
        
               | doctorpangloss wrote:
               | Lemme guess, we should bring back Bretton Woods?
        
               | Karrot_Kream wrote:
               | Do you want to take a 20% pay cut so I can take the
               | marginal benefit? Who wants to volunteer to be barred
               | from working so I can negotiate better salary?
        
             | jitix wrote:
             | Thanks for pointing out this skewed view of economic
             | history common in North America.
             | 
             | The short period of boom in 50s/60s US and Canada was
             | driven by WW2 devastation everywhere else. We can see the
             | economic crisis' in the US first in the 70s/80s with Europe
             | and Japan rebounding, then again in 90s/00s with China and
             | East Asia growing, and now again with the rest of the world
             | growing (esp Latin America, India, Indonesia, Nigeria,
             | Philippines, etc). Unless US physically invades and
             | devastates China, India or Brazil the competition will keep
             | getting exponentially higher. It's a shame that US didn't
             | invest all that prosperity into social capital that could
             | have helped create high value jobs.
             | 
             | In short, its easier to have high standards of living in
             | your secure isolated island when the rest of the world
             | (including historical industrial powers) are completely
             | decimated by war.
        
               | jimbokun wrote:
               | > It's a shame that US didn't invest all that prosperity
               | into social capital that could have helped create high
               | value jobs.
               | 
               | What does this sentence mean?
        
               | redhed wrote:
               | I assume the idea is more money could've been invested
               | into bringing the bottom rungs of American society up and
               | created a more skilled and educated workforce in the
               | process.
        
               | jimbokun wrote:
               | So "social capital" == "education"?
               | 
               | The US has pushed a shit ton of money into education. I
               | mean an unreasonable amount of it went to administrators.
               | But the goal and the intent was certainly there.
        
               | nradov wrote:
               | Education is part of it. But a lot of the social capital
               | which makes societies prosperous is separate from what we
               | usually consider to be education. On an individual
               | behavior that includes things like knowing how to show up
               | for work on time, sober, and properly dressed, and follow
               | management instructions without arguing or taking things
               | personally. These are skills that people in the middle
               | and upper classes take for granted but they forget that
               | there are a large number of fellow citizens in the
               | economically disconnected underclass who never had a good
               | opportunity to learn those basics. As a society we've
               | never done a good job of lifting those people up.
        
               | bonsai_spool wrote:
               | > I mean an unreasonable amount of it went to
               | administrators. But the goal and the intent was certainly
               | there.
               | 
               | This is wrong.
               | 
               | The increase in administrator pay began well after the
               | crises cited in OP.
               | 
               | You could cite spending on the sciences (and thus Silicon
               | Valley), but the spending by the US did not accrue to
               | administrators; and further, federal money primarily goes
               | to grants and loans, but GP is citing a time over which
               | there were relatively low increases in tuition.
        
               | jitix wrote:
               | Cheaper education, free/subsidized healthcare,
               | free/subsidized childcare, cultural norms around family
               | support, etc.
               | 
               | Things that let workers focus on innovation. IT workers
               | in cheaper countries have it much easier while we have to
               | juggle rising cost of living and cyclical layoffs here.
               | And ever since companies started hiring workers directly
               | and paying 30-50% (compared to 10-15% during the GCC era)
               | the quality is almost at par with US.
        
               | palmotea wrote:
               | >>> It's a shame that US didn't invest all that
               | prosperity into social capital that could have helped
               | create high value jobs.
               | 
               | >> What does this sentence mean?
               | 
               | > Cheaper education, free/subsidized healthcare,
               | free/subsidized childcare, cultural norms around family
               | support, etc.
               | 
               | Except for free/subsidized healthcare, didn't the US
               | _already have_ those things during the post-war boom?
               | 
               | Cheaper education? Public K-12 schools, the GI bill,
               | generous state subsidies of higher education (such that
               | you could pay for college with the money you made working
               | a summer job).
               | 
               | Free/subsidized childcare, cultural norms around family
               | support? Wages high enough to raise a family on a single
               | income, allowing for stay-at-home moms to provide
               | childcare.
        
               | jitix wrote:
               | > Except for free/subsidized healthcare, didn't the US
               | already have those things during the post-war boom?
               | 
               | Yes, but education system is being dismantled piece by
               | piece at all levels. I work in edutech and our goal is to
               | cut costs faster than revenue. Enrolments are down,
               | students are over burdened with student loans, and new
               | grads can't compete in the market.
               | 
               | Also, do you think kids going to K-12 in the US can
               | compete with kids who go to international schools in
               | China and India? High end schools in those countries
               | combine the Asian grind mindset with western education
               | standards.
               | 
               | > Wages high enough to raise a family on a single income,
               | allowing for stay-at-home moms to provide childcare.
               | 
               | This was a special period of post war prosperity that I
               | mentioned. It was unnatural and the world has reset back
               | to the norm where a nuclear family needs
               | societal/governmental support to raise kids, or need to
               | have two 6 figure jobs. "It takes a village to raise a
               | child" is a common western idiom based on centuries of
               | observations. Just because there was 20-30 years of
               | unnatural economic growth doesn't make it the global or
               | historical norm.
        
               | nradov wrote:
               | Education is a tough one. Like healthcare, it's highly
               | subject to Baumol's Cost Disease. Technology holds some
               | potential but fundamentally we still need a certain ratio
               | of teachers to students, and those teachers get more
               | expensive every year.
               | 
               | https://www.unesco.org/en/articles/baumols-cost-disease-
               | long...
               | 
               | Education should be well funded. But at the same time,
               | taxpayers are skeptical because increasing funding
               | doesn't necessarily improve student outcomes. Students
               | from stable homes with aspirational parents in safe
               | neighborhoods will tend to do well even with meager
               | education funding, and conversely students living in
               | shitholes will tend to do badly regardless of how good
               | the education system is. If we want to improve their lot
               | then we need to fix broader social issues that go beyond
               | just education. Anyone who has gotten involved with a
               | large school district has seen the enormous waste that
               | goes to paying multiple levels of administrators, and
               | education "consultants" chasing the latest ineffective
               | fad. Much of it is just a grift.
        
               | palmotea wrote:
               | >> Except for free/subsidized healthcare, didn't the US
               | already have those things during the post-war boom?
               | 
               | > Yes, but education system is being dismantled piece by
               | piece at all levels.
               | 
               | So? That's not really relevant to the historical period
               | you were referring to when you said: "It's a shame that
               | US didn't invest all that prosperity into social capital
               | that could have helped create high value jobs."
               | 
               | At the time, Americans _already had_ many of the things
               | you 're saying they should've invested in to get. How
               | were they supposed to predict things would change and
               | agitate for something different without the hindsight you
               | enjoy?
               | 
               | > This was a special period of post war prosperity that I
               | mentioned. It was unnatural and the world has reset back
               | to the norm where a nuclear family needs
               | societal/governmental support to raise kids, or need to
               | have two 6 figure jobs.
               | 
               | Exactly why do you think it is it unnatural?
               | 
               | I think you should be more explicit about how you think
               | things _should_ be for families. Because going on an on
               | about how the times when things were easier was
               | "unnatural" may create the wrong impression.
               | 
               | Also keep in mind where talking about _human society_
               | here, the concept of  "natural" has _very little_ to do
               | with any of it. What were really talking about is the
               | consequence of the internal logic of this or that set of
               | _artificial_ cultural practices.
        
               | jitix wrote:
               | > How were they supposed to predict things would change
               | and agitate for something different without the hindsight
               | you enjoy?
               | 
               | By comparing themselves to their counterparts in other
               | countries. By 1955 there should have been alarm bells
               | ringing as Europe re-industrialized. Same with 70s oil
               | crisis but the best that US could do was to cripple Japan
               | with Plaza Accords.
               | 
               | Americans even now have a mindset that nothing exists
               | beyond their borders, one could assume it was worse back
               | then.
               | 
               | > Exactly why do you think it is it unnatural?
               | 
               | Because only two industrialized countries were left
               | standing after WW2 and those two countries enjoyed
               | unnatural growth until others caught up - first the
               | historical powers in Europe then Asia.
        
               | judahmeek wrote:
               | Right, because Europe is so innovative.
               | 
               | The mother of invention is idiomatically necessity, not
               | comfort.
               | 
               | Ultimately, increased levels of competition should lead
               | to higher levels of innovation.
               | 
               | Btw, what is "the GCC era" a reference to?
        
               | jitix wrote:
               | Europe is quite innovative on per-capita basis. Not like
               | US but the workers there have much happier lives and
               | their societies don't have extreme inequality and
               | resulting violence like the US.
               | 
               | China is arguably more innovative than all and has
               | terrible work life balance, but their society is stable
               | and you won't go from millionaire to homeless just
               | because you had to get cancer treatment.
               | 
               | GCC = global consulting companies, the bane of
               | innovation. Outsourcing of all kinds (even domestic C2C)
               | should be banned.
        
               | palmotea wrote:
               | > Thanks for pointing out this skewed view of economic
               | history common in North America....
               | 
               | > In short, its easier to have high standards of living
               | in your secure isolated island when the rest of the world
               | (including historical industrial powers) are completely
               | decimated by war.
               | 
               | So, what's your point? That the plebs shouldn't expect
               | that much comfort?
        
               | jitix wrote:
               | A common maxim across all cultures is to "manage
               | expectations" for happiness.
               | 
               | And while comparing societal standards expand the time
               | horizon to 100 years, not nitpick one specific unnatural
               | era of history.
               | 
               | An automotive engineer in Detroit in 1960 was a globally
               | competitive worker because most of his counterparts in
               | other countries were either dead, disabled or their
               | companies bankrupt.
               | 
               | The equivalent in today's world would be aerospace
               | engineers, AI researchers, quantum engineers, robotics
               | engineers, etc who arguably have the same standard of
               | living as the automotive engineer in 1960s Detroit.
               | 
               | Economic and technological standards evolve - societies
               | should invest in human capital to evolve with them or
               | risk stagnation.
        
               | palmotea wrote:
               | > An automotive engineer in Detroit in 1960 was a
               | globally competitive worker because most of his
               | counterparts in other countries were either dead,
               | disabled or their companies bankrupt.
               | 
               | > The equivalent in today's world would be aerospace
               | engineers, AI researchers, quantum engineers, robotics
               | engineers, etc who arguably have the same standard of
               | living as the automotive engineer in 1960s Detroit.
               | 
               | You know were not really talking about top-end positions
               | like automotive engineers in Detroit in 1960. I think
               | we're talking more about automotive factory workers in
               | Detroit in 1960.
               | 
               | > Economic and technological standards evolve - societies
               | should invest in human capital to evolve with them or
               | risk stagnation.
               | 
               | You need to be more explicit about how you think things
               | _should_ be for the common man.
        
               | eli_gottlieb wrote:
               | So you're saying that working-class living standards are
               | a zero-sum competition across capitalist countries, even
               | negative-sum as competing national economies grow their
               | total output and hourly productivity?
               | 
               | That sounds like a really shitty system.
        
             | cedws wrote:
             | I'm not going to engage with you on a debate because you
             | aren't acting in good faith.
        
             | jimbokun wrote:
             | > Every kind of a man, or woman?
             | 
             | Why do so many people miss the point on this?
             | 
             | Instead of making this dream true for all the people who
             | were previously excluded, we have pursued equality by
             | making this dream accessible to NO ONE.
             | 
             | > Well, this probably why statistics exist.
             | 
             | Like the statistics on plummeting mental health and
             | happiness, an obesity epidemic, increases in "deaths of
             | despair", and plateauing or decreasing life expectancy?
        
               | apsurd wrote:
               | You're both right. I take your point to mean similar to
               | the disastrous outcome of "no child left behind" act. I
               | do agree with you, but people didn't seriously _intend_
               | for the result to be everyone lowers to a shit position.
               | 
               | Or maybe you're saying that's always how these
               | initiatives turn out? It can't be helped?
        
               | watwut wrote:
               | I think there is something to be valued about historical
               | accuracy.
               | 
               | > Like the statistics on plummeting mental health and
               | happiness, an obesity epidemic, increases in "deaths of
               | despair", and plateauing or decreasing life expectancy?
               | 
               | In the 60ties, suicide rates went UP. Peaked around 1970
               | and we did not reached their levels.
               | 
               | Long terms statistics about alcoholism rates and drug use
               | are also a real exiting thing. We know that cirrhosis
               | death rate was going up in the 60ties up to 70ties,
               | peaked and went down. It was the time when drinking and
               | driving campaigns started.
               | 
               | Current drug use is nowhere near what it was a generation
               | ago.
        
             | apsurd wrote:
             | I originally upvoted the parent comment. But I changed it.
             | 
             | "The good ol' days" ... yeah, but good for who?
        
           | astura wrote:
           | According to the census bureau median family income in 1960
           | was $5,600, which is $58,946.59 in Jan 2024 dollars. It's
           | $83,730 in 2024.
           | 
           | For individual males, in 1960 it was $4,100 ($43,157.33 Jan
           | 2024 dollars) and $71,090 in 2024.
           | 
           | Sources:
           | 
           | https://www.census.gov/library/publications/1962/demo/p60-03.
           | ..
           | 
           | https://www.census.gov/library/publications/2025/demo/p60-28.
           | ..
           | 
           | The thing is, a 1960s standard of living would be totally
           | unacceptable today. Single car max, no air conditioning,
           | small house or apartment, multiple children sharing bedrooms,
           | no Internet, no cable, no streaming. Children allowed outside
           | by themselves.
        
             | ethanwillis wrote:
             | now tell us how they calculate those inflation adjusted
             | dollars-- what basket of goods? prices in which markets?
        
         | RajT88 wrote:
         | > The problem becomes that eventually all these people who are
         | laid off are not going to find new roles.
         | 
         | At least one sci-fi author has gamed this out:
         | 
         | https://marshallbrain.com/manna1
        
         | JumpCrisscross wrote:
         | > _Who is going to be buying the products and services if no-
         | one has money to throw around?_
         | 
         | We have no basis for seriously considering this hypothetical
         | when it comes to LLMs.
        
           | ben_w wrote:
           | Depends how absolute one takes the statement "no-one has
           | money to throw around".
           | 
           | Taken loosely, we have seen previous developments which make
           | a large fraction of a population redundant in short periods,
           | and it goes really badly, even though the examples I know of
           | are nowhere near the entire population.
           | 
           | I'm not at all sure how much LLMs or other GenAI are "it" for
           | any given profession: while they impress me a lot, they are
           | fragile and weird and I assume that if all development
           | stopped today the current shinyness would tarnish fast
           | enough.
           | 
           | But on the other hand, I just vibe coded 95% of a game that
           | would have taken me a few months back when I was a fresh
           | graduate, in a few days, using free credit. Similar for the
           | art assets.
           | 
           | How much money can I keep earning for that last 5% the LLM
           | sucks at?
        
         | rozap wrote:
         | Realistically I think there are two outcomes:
         | 
         | AGI succeeds and there are mass layoffs, money is concentrated
         | further in the hands of those who own compute.
         | 
         | OR
         | 
         | AI bubble pops and there are mass layoffs, with bailouts going
         | to the largest players to prevent a larger collapse, which
         | drives inflation and further marginalizes asset-less people.
         | 
         | I honestly don't see a third option unless there is government
         | intervention, which seems extremely far fetched given it's
         | owned by the group of people who would benefit from either
         | scenario presented above.
        
           | jimbokun wrote:
           | If the AI bubble pops it's just another bubble like the many
           | ones that have occurred throughout history and the market
           | eventually recovers.
           | 
           | In the AGI Succeeds scenario, the situation is unprecedented
           | and it's not clear how it ever gets better.
        
             | throwacct wrote:
             | Tbh, the answer is simple: if we truly get AGI, the
             | government would nationalize it because it's a matter of
             | national security and prosperity for that matter.
             | Everything will change forever. Agriculture,
             | Transportation, Health... Breakthrough after breakthrough
             | after breakthrough. The country would hold the actual key
             | to solve almost any problem.
        
               | jimbokun wrote:
               | Looking at the current state of politics around the
               | world...you really think that would be the outcome?
        
               | throwacct wrote:
               | AGI? Absolutely. If your country gets there, would anyone
               | relinquish that type of power and knowledge?
        
               | gizajob wrote:
               | The government only nationalises losses, not wins.
        
               | gizajob wrote:
               | The key to typing out the solution to any problem, not
               | actually solving it.
        
               | apsurd wrote:
               | when you write it out like that, it sounds
               | unfathomably... silly.
               | 
               | I'm not a tinfoil hat skeptic, and i'd like to think i
               | can accept the rationale behind the possibility. But I
               | don't think we're remotely close as people seem to think.
        
           | throwacct wrote:
           | Third option: no bailouts of any type. Don't socialize
           | losses. The board resets itself again, and let entrepreneurs,
           | small businesses flourish again.
        
           | goalieca wrote:
           | Bailouts for chip fabicration and nothing else.
        
       | guytv wrote:
       | Every cent poured into this boom is building Google's future
       | competitors.
       | 
       | Of course he's nervous - what else would you expect him to say?
        
       | mtrovo wrote:
       | Assuming this is irrational and must come back to reality at some
       | point, I'm not convinced this is connected to the common man
       | economy as other bubbles in the past were. This round of
       | investment is mostly being funded by exuberant cash flow
       | accumulated over the years that was otherwise used as stock
       | buybacks by a small number of stocks and some private credit
       | deals that are not that accessible to the general public. This is
       | looking more like a crypto crash kind of effect rather than a
       | 2008 one.
        
       | beanjuiceII wrote:
       | will gamers be eatin' good?
        
         | s1mplicissimus wrote:
         | i hope so, its been a while
        
       | HardwareLust wrote:
       | ...says the man guilty of said irrationality.
        
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