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.
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.
In other words, do you think we're in 1995 of the dotcom or 2000?
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.
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.
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.
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.
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.
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.
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.
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.
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"?
because leaders in the space also keep saying it? And then making financial moves that us pleebs can't even dream of, which back that up?
This whole "the media keeps reporting it" as a point against the credibility of something is utterly silly and illogical.
They have a lot of reasons for saying that, including to give themselves cover in the event of a crash.
What’s happening now is a classic land grab. You’re always going to get inflated prices in that situation, and it’s always going to correct at some point. It’s difficult to predict when, though.
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?
Startups and other unprofitable companies however...
But unlike 08 crisis, we're getting a heads up to bring out the lube.
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.
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.
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.
Azure is a product all right, but there’s nothing particularly better there than anywhere else.
Google is only place that serves the enterprise (Workspace for productivity, Cloud for IT, Devices for end users) AND conducts meaningful AI research.
AWS doesn't (they can sell cloud effectively, but don't have any meaningful in-house AI R&D), Meta doesn't (they don't cover enterprise and, frankly, nobody trusts Zuck... and they're flaky.
Oracle doesn't. They have grown their cloud business rapidly by 1) easy button for Oracle on-prem to move to OCI, and 2) acting like a big colo for bare metal "cloud" infra. No AI.
Open AI has fundamental research and is starting to have products, but it's still niche. Same as Anthropic. They're not in the same ball game as the others, and they're going to continue to pay billions to the hyperscalers annually for infra, too.
This is Google's game to lose, imho, but the biggest loser will be AWS (not Azure/Microsoft).
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.
OpenAI, Anthropic, and others will be bought for cents on the dollar.
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.
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.
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.
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.
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".
They have <a really expensive> infrastructure that serves 800 million monthly active <but non-paying> users.
I give more of my data to OpenAI than to Meta. ChatGPT knows so much about me. Don't you think they can easily monetize their 800 million (close to 1 billion by now) users?
This is why Meta is all in on AI by the way. With nearly 1 billion users, ChatGPT is a huge threat to Meta's ad empire.
People are on Facebook to interact with other human beings, not LLMs. People won't leave Facebook to use ChatGPT.
Creeping. ChatGPT is becoming more than just a "talk with an LLM" app.
I am pretty sure they will be able to monetize it. But there is a big difference between "generating revenue" and "generating profit". It's way cheaper to put ads between posts of your friends (like FB started out with ads) then putting ads next to the response of an LLM. Because LLM responses has to be unique, while a holiday photo of yours might be interesting for all of your friends, and LLM inference is quite expensive, while hosting holiday photos is cheap. IMHO this is the reason why the 5th generation of ChatGPT models try to answer all possible questions of the world in one single response, kinda hoping that I am going to be happy with it an just close the chat.
This is the problem with your original argument. It assumes that having a "good model" (e.g. one that performs well on some benchmarks) has somehow to do with something in the real world. It doesn't. If you can show that it does, your thesis might have at least a glimmer of credibility.
The idea that a chatbot will somehow displace an operating system is the kind of absurdity that follows from making this error.
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.
But it is clearly the direction. Apple will try to stave off this move by turning iOS more into an LLM as well.
Ah yes, PromptOS will go down in the history books for sure.
I seriously doubt it. If this bubble pops, the best OpenAI can hope for is they just get absorbed into Microsoft.
Or, instead of spending billions training models that are nearly all the same, they instead take advantage of all the datacenter full of GPUs, and AI companies frantically trying to make a profit, many most likely crashing and burning in the process, to pay relative pennies to use the top, nearly commoditized, model of the month?
Then, maybe someday, starting late and taking advantage of the latest research/training methods that shave off years of training time, save billions on a foundation model of their own?
I don't think it makes sense for Apple to be an AI company. It makes sense for them to use AI, but I don't see why everyone needs to have their own model, right now, during all the churn. It's nearly already commodity. In house doesn't make sense to me.
AI isn’t bullshit, but selling access to a proprietary model has certainly not been proven as a business model yet.
I have got news for you...
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.
And just like 23andme, so will all that data be sold for dimes.
It's actually 520% or 5.2 - still high but 520 would be crazy.
Not sure how the situation is in Europe and Asia, but I would guess about the same.
(I know of a few companies, but they’re tiny tiny minnows compared to the big AI companies listed in the US).
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."
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.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.
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.
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.
https://en.wikipedia.org/wiki/Double_marginalization?wprov=s...
Equities are forward looking. TSMC's valuation doesn't make sense if it doesn't have a backlog to grow into.
Nvidia earnings tomorrow will be the litmus test if things are going to topple over.
Maybe this is because these industries are better understood and there is less risk involved, but I wonder if the current big software companies will take similar paths in the future.
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).
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.
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.
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 :/
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.
> I also think they should be let to fail, but there's no way the US GOV ever allows them to.
There's different ways to fail, though: liquidation, and a reorganization that wipes out the shareholders.
OpenAI could be liquidated and all its technology thrown in to the trash, and I wouldn't shed a tear, but Microsoft makes (some) stuff (cough, Windows) that has too much stuff dependent on it to go away. The shareholders can eat it (though I think broad-based index funds should get priority over all other shareholders in a bankruptcy).
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.
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.
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.
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
People would just switch to the next IM platform. Most would forget they ever needed whatsapp 12 hours after a permanent whatsapp shutdown.
I mean, the only reason the majority of whatsapp users use whatsapp is the network effect.
Take that away and you think people would just give up trying to IM each other?
Hard disagree
I'll grant you Meta, but losing Google in that way would be highly disruptive because so many people have their primary email account on it.
"""
Mr Pichai said action was needed, including in the UK, to develop new sources of energy and scale up energy infrastructure.
"You don't want to constrain an economy based on energy, and I think that will have consequences," he said.
He also acknowledged that the intensive energy needs of its expanding AI venture meant there was slippage on the company's climate targets, but insisted Alphabet still had a target of achieving net zero by 2030 by investing in new energy technologies.
"""
"Slippage" in this context probably means, "We no longer care about climate change but we don't feel that mere citizens are ready to hear us say it."
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.
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.
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."
[1] https://en.wikipedia.org/wiki/AI_winter#The_setbacks_of_1974
[2] https://en.wikipedia.org/wiki/AI_winter#AI_winter_of_the_199...
Oh, you think we won't see AGI in 2026?
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
That's what I'm personally hoping for anyway, would rather the economy avoid a big recession.
Private actors are the ones who are investing into AI, and there's no real way for them to invest into public infrastructure, or to eventually profit from it, the way investors reasonably expect to do when they put up their money for something.
It's the government who can choose to invest into infrastructure, and it's us voters who can choose to vote for politicians who will make that choice. But we haven't done that. So many people want to complain endlessly about government and corporations -- not entirely without merit, of course -- but then are quick to let voters off the hook.
https://www.noahpinion.blog/p/should-we-worry-about-ais-circ...
Better to rip the bandaid off and begin anew.
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?
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
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.
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.
Plus the information they can provide to the State on the sentiment of users is also going to be greatly valued
A bubble doesn’t need a grand catalyst to collapse. It only needs prices to slip below the level where investors collectively decide the downside risk outweighs the upside hope. Once that threshold is crossed, selling accelerates, confidence unravels, and the fall feeds on itself.
See y'all in the spring!
They can't, not firever. Bubbles pop.
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.
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.
Everyone thinks it will pop the way the dotcom bubble popped
> There's plenty that's not going to go away / anywhere, but I'm sure lots of startups will fail and close their doors.
Just like the dotcom bubble pop - IOW, just like the way everyone thinks it will pop.
Company owner (startup) met us at the door to the office, said sorry but investors pulled out (or something), gave us all a cheque for the current month salary, and we walked off.
Luckily I got hired at a non-dotcom (not web-based) business after about a month.
In spite of maybe 90% of the dot-coms folding, some still stayed around (Amazon, Google, etc).
When the bubble pops, some hang on.
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.
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.
America’s Retirement Savings in Bermuda entities that lose US protections while making opaque, complex bets: https://www.bloomberg.com/graphics/2025-america-insurance-pa... https://archive.ph/lhZv9
What is?
I wonder who’s writing the script.
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.
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.
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.
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.
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.
Technically yes, but only because something monotonically increasing in price is volatile.
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.
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.
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.
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?
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.
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.
[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")
"Information technology" apparently just means Microsoft and Apple.
[0] https://en.wikipedia.org/wiki/Global_Industry_Classification...
[1] https://en.wikipedia.org/wiki/List_of_S%26P_500_companies
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?
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?
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.
If all jobs evaporate, what does the economy look like when just based on interest and dividend payments?
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.
I wish! My salary is a bit below the median US household income.
Or everyone else starts fighting that 10% once they get tired of scraps.
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.
What's that about the falcon and the falconer? The center cannot hold..
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.
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.
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.
Could go either way.
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.
What do you mean by bullshit jobs?
I've heard the term before I think even read a NYT or Atlantic article about it maybe a decade ago. My hazy recollection were jobs that added no actual value to society.
If this is true, then what value is there for AI to capture?
Also, do you really think that the majority of jobs don't add any value to society? I find that hard to believe in a free market.
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.
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.
What does this sentence mean?
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.
Would you rather live equally in poverty or live comfortably with others who are way more wealthy than you? Surprisingly people do seem to prefer the former, though I'd prefer the latter
In the US at least, progress in life expectancy and real wages has really stagnated in recent decades.
I don't see your point.
Those rules does not apply to the upper class and middle class workers have way more leeway regarding that than the lower class.
If one person doesn't show up on time, that's a bad habit. If no one shows up on time then that's a cultural issue[0], and much more devastating.
As an example, Zim dug itself a huge hole by kicking out the productive white farmers in 2000-2001. One of the key issues charitable foreign people trying to help Zimbabwe addressed was in re-educating the local population in why it matters that all the planting work is done by a certain time of year. The white farmers had all that knowledge, and cultural experience of hard work, and had made Zimbabwe the breadbasket of Africa.
Not sure how this is a relevant example of a culture that don't value punctuality.
No, the comment you're replying to pretty clearly put the responsibility on the party that "rushed the land reform with no preparation".
And also accurately noted that a nation seizing capital and redistributing it to people who don't know how to use it is rather different from what had been the thread topic of personal skills / useful habits being purportedly unattainable by the lower classes without explicit instruction.
Government can’t really do much to help with that.
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.
Edit: Not at home, but even a cursory serious search will turn up reports like this one that indicate the lack of clarity in the popular uprising against money "[going] to administrators"
https://www.investigativeeconomics.org/p/who-to-believe-on-u...
First, where is your data?
Second, this discussion is clearly about post-secondary education ("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.")
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.
>> 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.
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.
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.
> 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.
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.
That's not realistic, except in hindsight. Most people everywhere pay more attention to their immediate environment and living their lives. Not speculating about what is the global economy is going to look like in 50 years, and how would those changes affect them personally.
You're talking about stuff only some PhD at RAND would be doing (or would have the ability to do) in the 1960s.
Without the democratic pressure of common people either 1) having a need or 2) seeing things get worse, no changes like you describe would happen.
> 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.
What's natural?
And more importantly: how do you think things should be for families.
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?
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.
I ask because, when I do a Google search, the two most common meanings for that term are “Global Capacity Center” and “Gulf Cooperation Council”.
Also, China is 3rd, behind South Korea & Japan
That & the differing levels of patent application per capita across Europe suggests that patent applications are directly related to work/life balance & perhaps some sort of infonomic aggregation & doesn't seem to support any correlation with quality of life.
Chinese society is more "metastable" than really stable. The Cultural Revolution and Tiananmen Square massacre weren't that long ago. Chinese history going back millennia is full of violent revolutions and civil wars. Xi Jinping has been able to keep a lid on things lately through brutal purges of all other potential power centers but times may get "interesting" again when he leaves power.
> 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?
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.
> 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.
Times change, standards rise, competition increases. If America wants to remain competitive globally you need to work in the top 1% fields like you did back in 60s, not expecting $25 per hour for flipping burgers (which should have been automated with robots by now).
That sounds like a really shitty system.
What could have made a big difference is if foreign competition arose for American materials and land, which it did. But that is under our control, we collectively can choose whether to allow them to buy it or not, and whether to let people in at a rate that outpaces materials discovery and harvesting capabilities.
We also restricted materials harvesting quite a bit during this time period, for example I believe a lot of forestry protections were not in place yet.
The US just renamed "Department of Defense" to "Department of War" and they seem willing to go to any extreme to "Make America Great Again". Threatening to take over Canada, Greenland, and Panama already in the first few months of the current administration. Using US military on US soil. There's no line they won't cross. WW3 isn't off the table at all, unfortunately.
Don't give them any ideas.
Are you aware of the plan Marshall?
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?
Or maybe you're saying that's always how these initiatives turn out? It can't be helped?
There were certainly some rich and powerful people who did intend to lower everyone (else) to a shit position.
That's what stuff like anti-union policies are about. Sure, they drape it up in nice rhetoric, but ultimately the intent is to reduce the power (and thereby the material outcomes) of the common the worker.
But of course there were also other developments that had the effect more unintentionally.
> 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.
Because one party wants to return to those times with the exact same social norms. So it's a dangerous line of thinking to forget that women were walled out of many jobs, or had a huge wage gap when they were let in. As well as minorities only barely starting to really get the same opportunities after a lot of struggle.
>Like the statistics on plummeting mental health and happiness, an obesity epidemic, increases in "deaths of despair", and plateauing or decreasing life expectancy?
Yes. When it affects the majority is only when we start to pay attention.
Nah, that is not what has happened. Equality is more of an unrelated thing. Business owners and capital are by their very nature opposed to the dream. Even if in a given moment of time they may give concessions, the endless drive for returns and growths means that sooner or later it will always get to the point where we are.
The problem here is capitalism.
"The good ol' days" ... yeah, but good for who?
Life has improved for nearly everyone on nearly every metric. But if one myopically focuses on house purchasing as the only thing that matters and takes anomalous post WW2 period, then sure, things are bad (ignoring the fact that housing space and quality + amenities improved dramatically, but hey, who cares about nuance, we just love to complain!)
How are statistics going to answer this question? Statistics are used to measure things. They don't tell you what things you should be measuring.
But each decade's economy is the product of decades past. The policies of the 90s brought us to the present. So we don't want to repeat the mistakes of the 90s, and the 80s are associated with the iniquities of the Reagan administration. Thus you get this misplaced nostalgia for the 50s-70s without really understanding the problems or the progress that society made even as the highest levels of government seemed to drift off course.
Exactly.
What about black people or any other minority? Black people couldn't even vote until 1965. Housing discrimination and things like redlining would prevent people from living where they wanted even if they had the money.
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...
https://data.bls.gov/cgi-bin/cpicalc.pl
The thing is, a 1960s standard of living would be totally unacceptable by almost everyone today. Single car max, no air conditioning, small house or apartment, multiple children sharing bedrooms, no cellphones, no Internet, no cable, no streaming. Local calls only. Children allowed outside by themselves.
There are a lot of assumptions that go into making that calculation.
If I tell you that the value of a dollar you hold has gone down or up this year versus last year because of the price fluctuation of an item you never have or never will purchase, such as hermit crabs in New Zealand.
Would you believe your dollar is worth more or less? What if the price of a good you do spend your dollars on has an inverse relationship with the price of hermit crabs in New Zealand? Or what if the prices of the items you do buy haven't moved at all?
Your "concerns" are all well known and accounted for when calculating things like the consumer price index.
I get you're just pissed off for whatever reason, but I'll still try to explain more.
My point is not addressed when calculating the consumer price index because i'm saying that a single selection of prices and goods to produce a single price index does not tell a person what the value of their money is unless they just happen to be literally the median consumer.
Are you going to sit there with a straight face and tell me you buy every single item that is used in that consumer price index? In every city? You're just not being serious if that's the case.
You're confusing a price index that minimizes the error in measuring inflation when applied to a large varying amount of people with what i'm advocating which is a price index that's personalized to and minimizes the error in measuring inflation for an individual. Other people's buying habits and prices for things in places where they live don't need to go into a personalized price index.
It's tiring watching people with no idea what they're talking about repeat the same "what about ..." arguments when professionals in the field have spent decades developing and maintaining models that have been proven over that time to be helpful.
It's also not a coincidence that nearly 100% of the people trying to poke holes in those models are people who disagree with the results generated from them, and that nearly 100% of those people don't have a clue about the topic at hand.
Of course a broad based index that is designed to represent the behavior of hundreds of millions of people is less accurate for you (or me, or anyone) personally than a model based solely on an individual's behavior. I don't know anyone on earth who would argue otherwise.
As a reminder, you started off by making a very lazy statement broadly criticizing a post that included well cited economic data showing that the inflation-adjusted median household income has increased substantially since the 1960s, which was in response to yet another terminally online doomer incorrectly claiming that your average American is worse off today than they were then.
You're now claiming that your issue with the provided data showing that people are overall financially better off today than they were in the 1960s is that that data isn't tailored to you (or any other individual) personally? I think that just demonstrates the validity of my original comment, because that's an absurd criticism.
FYI, you don't need to "advocate" for a personal price index. Track your spending over time and calculate it. If you want get much use out of it, you're going to want to incorporate the CPI data for your metro area as well (which exists and is publicly available) so you can both compare your spending to the median and backfill missing data as needed (for example, historical childcare expenses when you become a new parent).
Imagine transmigrating King Louis XVI (pre-revolution) into some working class professional with a refrigerator, a car, cable TV, etc. I don't think it's a given that he'd consider the package an upgrade.
"Pre-revolution" is just to preempt any "Hurr hurr he'd be ecstatic not to have his head chopped off LOL."
So the kids growing up now might be playing the original Nintendo NES, or maybe an N64, they’d have phones and even computers, etc.
It could even be a little more nuanced like, the community could vote in certain classes of more modern goods.
The problem isn't "more technology" (nor is the solution "less) but rather a change in who controls it and benefits. We shouldn't surrender-in-advance to the idea that the stompers will definitely own it.
More like the last 50 years.
https://www.pewresearch.org/short-reads/2018/08/07/for-most-...
"For most U.S. workers, real wages have barely budged in decades"
The TL;DR is that in 1964 the average hourly wage was $20.27. As of 2018, average hourly wage was $22.65.
Over 50 years that’s a decent amount of growth. Obviously it could be better but it’s not nothing.
In practice, I think this shows why economic statistics are borderline lies.
In the 1930s, it wasn't possible so what's your point? (History time: What happened on October 24, 1929?) Choosing the 1960s as a baseline is artificially cherry-picking an era of economic growth (at the expense of the rest of post-WW2 Europe and Asia who were rebuilding) instead of an era of decline or normalcy.
But we already did the growth. We didn't shrink back. So we should still be able to get those results.
World population:
1960: ~3B
2025: ~8.3B
It was a VERY different world. That growth might not have gone anywhere but it’s not a very significant amount of wealth in today’s terms.
People are very worried about birth rates because for a while it will mean that there will be too few people of working age, which will be a disaster. But big picture, perhaps a correction is overdue, we cannot make people’s lives better if we keep adding people faster than we are growing the world economy.
You always need to put history in the context that the world was pretty empty. Less value was created but there was less competition for resources and it was easier for certain groups to stand out or dominate.
1900: ~1.6B
1750: ~750M
1500: ~450M
1000: ~350M
1: ~250M
Land is the main thing that's limited, but getting a smaller yard doesn't fix much.
It has been for the last few thousand years.
Now technology mostly divides and manipulates us, enshittifies things, and works to turn billionaires into trillionaires.
AI healthcare, for example. Have an entity that can diagnose you in a week at most, instead of being sent from specialist to specialist for months, each one being utterly uninterested in your problem.
I'm skeptical of this explanation for falling birthrates just because birthrates are falling across the world and there seems to be no correlation between fertility and financial security. America has low birthrates. Scandinavia (usually considered to have generous welfare states) has low birthrates. Hungary, where the government gives massive tax breaks (IIRC they spend around ~6% of their GDP on child incentives), has low birthrates. Europe, East Asia, India, the Middle East, the Americas, basically the whole world except for central Asia and Sub-Saharan Africa (which are catching up) has low birth rates. Obviously the economic conditions between basically all the countries in the world varies wildly, but there isn't a consistent relationship between those conditions and fertility.
Also within countries, the number of children people have is not always correlated with wealth (and at times in the past 60 years it has been negatively correlated).
Anyway, I find your argument intuitive, but it doesn't seem to align with the data we have.
- women don't want to leave the workforce because one salary cannot support a family
- yet women remaining in the workforce, since single-salary is infeasible, thusly doubling supply of workers, lowering salaries, which itself makes it infeasible to single-income a family
Not to pick on women, as a feminist if you ask me, all modern men should have to be houseboys to serve their feminine masters. It does suck but it is necessary to benefit the modern women who did not suffer, in so by causing modern men to suffer -- to make amends for the suffering of all women in the perpetuity of history at the hands of all historical men, neither of which are alive today.
There is little incentive to walking in a contract, where you are working all the time, no appreciation, love, gratitude or even a thank you. All the time being made to feel like you are not measuring up. And they'd rather be with somebody else apart from you. That done, you also come back from work and do all the chores you would if you remained single.
And if a few years later the other party decided to break the contract, now they take your home, get monthly pensions(with raises), and get to start the process all over again with somebody else at your expense.
Plus these days kids don't stay back with aging parents to care for them, so having kids appears pointless as well.
By and large, let alone an incentive, marriage and children seem to a massive negative for men. Hence I wouldn't be surprised low marriage and birth rates all over the world.
Why would you want to do all this? When you can work, keep the money, and spend it for your pleasure by staying single?
You dont have to pay alimony of the wife worked thw whole time. That complain is funny in the comtext of men demanding to return back to time where alimony arrangement was necessary protection.
Even in marriage, it is more of women who initiate divorce are report higher hapiness after the divorce. Men report lower hapiness and are more likely yo want to marry again.
But if you dial up the pain in the process men will bail. This shouldn't be surprising.
Perhaps the most primal biological set up of all, the very basis of evolution is response to stimulus.
i'm sorry, what? it's ingrained in men to be worker-drones and every man sees this as his fulfillment?
yikes. as the kids say, 'touch grass'. translated for older people, "maybe expand your world-view and don't extrapolate your idea of a man to all of men."
Men can work all sorts of ways, and that can include raising kids. Women tend to be a lot less happier leaving their kids to go toil with the dirt.
What are women, then? Baby-machines, cooks and cleaners, which I guess you don't see as work?
I mean it's not the first time I encounter a dude with the same opinion as you have, but every time I'm surprised by the casual reductionism of our societies. Men make work, Women make baby. Men hard, Women soft. Men strong and powerful. Women weak and emotional.
On average those are true though, men work more, women take more care of children, men are harder than women, men are stronger than women, and women are more emotional than men. On average.
It is fine for women to be manly and men to be feminine, but that doesn't negate the fact that most women are feminine and most men are masculine.
Men are Men, and Women are Women. But Women wanted to be like Men, so they did, but Men don't like Women as Men, and Women are shocked to learn this.
Now people don't even know what a Woman is.
even though i did write that i am done with discussing this topic with people, a sliver of hope was was in my mind. maybe if i continued engaging, you would make a clearer point. but you started by comparing racial, geographical quirks of different cultures to a 50/50 gender split over the whole world. more asian women and men are lactose intolerant, but surely 99% of their women are obedient housewives and 99% of the men are workhorse providers. globally, of course, in every culture. that's just the way things are, respect history, yo.
then you decided to go on a rant about women specifically wanting this and that. and then decided to top it all off with some nice transphobic(call it what you want) bs.
i don't have the energy to seriously reply to this, and even if, it probably wouldn't matter anyways. cheers, Man®
Easy to want that when "have kids" just means "impregnating your wife". Bet most of them would balk at the prospective of a 2 decade long 24/7 childcare duty routine if they had to do it themselves. Plus, if they really wanted to raise kids, many in orphans would benefit from a parent
Basically a glowing LED billboard.
You can't go back and get pregnant. And your marriage probably ended in divorce already anyway by now, which is a whole more amount of suffering.
Everyone is on a journey, and the path their journey takes is partially the choices made. People are allowed to think hard about their choices, and the choices of others.
If they want their path to go their, so be it, and but it's cruel to not discuss the ramifications of choices made.
I don't think data with all of those factors (household income, number of earners per household, gender of the earners, home ownership, and number of children) exists for any country. Do you have data like that for 1960s America or is your argument based on extrapolations from watching Leave it to Beaver?
But if we abstract your hypothesis slightly to: fertility is lower now than in 1960 because people are less financially secure now than they were in 1960, I don't think the data we have supports this.
Sorry but I wont get myself into 40 year debt for a bungalow.
After my father's death we sold our old family home for ~70k€ 15 years ago. It would have been in the 300-400k range nowadays. My salary certainly did not double - triple in that time frame.
I am already 30, wont have a good start capital at 40 and I for sure wont buy a house that late in life.
I know plenty of people in germany who repeat continuously that stance, and they recognize they spend well over 10k/year in vacacions.
Going out is living life though, I wont reduce my quality of life for decades just so I can afford a house.
But in short, I do barely spend money on vacations.
Anayway my story: never ever sid vacation abroad.Vacation outside my home only every 2 or 3 years. Never eat out. I have no idea how is it to go to a concert. No expensive hobbies. When I was 40 all of that provided 40k for a down payment.
I do not regret it.
Edit: I just checked on the laws etc. 2-wire electric installations are no longer allowed and property owners are obligated to renew them. In this case that would have to be done in the complete house with all other owners. Congratulations, there go another 50k.
Wann die Änderung verpflichtend ist Bei Neuanlagen: Die klassische Nullung darf seit 1973 nicht mehr für neue Installationen verwendet werden. Bei Modernisierungen: Wenn im Rahmen von Renovierungen oder Erweiterungen gearbeitet wird, müssen betroffene Stromkreise auf ein separates Null- und Schutzleitersystem umgerüstet werden. Bei unsicheren Anlagen: Ist der Bestandsschutz nicht mehr gegeben, weil Mängel oder Gefahren bestehen, die die Sicherheit für Leib und Leben oder Sachen gefährden, ist eine Umrüstung erforderlich.
You can live without a garage. Can't you? In Germany a car is pretty safe in the street. And I assume, you do not have a 50k+ car, if we are discussing "why can't I buy a house"...
Kitchen and Bath look perfectly usable for many years still... That is what I mean. People say "I will not have a house" but what they mean is: "I will not have a perfect house, with completely new bath and kitchen, garage, lots of room for everything, very well located" well, no, you will not. Sorry.
I agree about heating. But 50k is for the whole building, which will probably have reserves, so it will cost you maybe 5k to 10k spread in 6 months or so. And you get state help because you will surely go for heat-pump, means it even goes a little down. So the price goes to 310k...
If the owner community decides on a heat pump, the wiring will have to be completely renewed. If the owner community decides on a modern oil heating system, the wiring will have to be renewed.
Parking your cars in the street while there is the option for a garage is somewhat antisocial, but let's not moralise. The garage is not optional, it's not sondereigentum or else it would have to be mentioned, so you'll have to pay.
What you are buying with this property is major financial uncertainty. There is a reason for this price.
It is definitely doable in the US, and I would imagine most Western countries as well. My knowledge outside of them isn't current enough to speak for the rest.
Specifically, both house prices and interest need to go down heavily. Sadly, they used higher interest to try to lower prices, and that didn't really bring prices down.
More supply isn't helping much either, as there is no diversity of supply, and builds aren't undercutting the market yet.
Why? Almost everywhere a majority of people (and certainly the majority of voters) are already invested in housing and do not want their investment to loose value.
> Specifically, both house prices and interest need to go down heavily. Sadly, they used higher interest to try to lower prices, and that didn't really bring prices down.
People are more willing to spend an ever-growing share of their dual-incomes on housing, which drives housing prices modulo interest. So interest has no actual effect on housing affordability, since it doesn't influence how much people are willing to spend. If you lower interest, prices are simply going to rise such that people spend the same % of their income on housing. If you increase interest, prices will (eventually, slowly, since this is a seller-dominated market) fall to match.
> More supply isn't helping much either, as there is no diversity of supply, and builds aren't undercutting the market yet.
New builds will never be cheaper than existing housing stock. Low-cost new housing is a mirage; new housing is premium by construction.
A big issue here is expectations - people are complaining because they can’t buy their own standalone house in a good neighborhood right next to work - while work is in a high demand, high pay area.
Also, well paid work is centralizing, so so the gradient is getting steeper (or was, pre-remote work).
Guess what, that was never the norm!
But a lot of people did buy in what were at the time low demand, high supply, areas that later became high demand areas! Like early Los Angeles.
Also, everything is getting more expensive relative to ‘hour worked’ because of centralization of capital, and more work force participation.
What many people don't realize is how badly the total housing inventory has fallen behind what is needed for the population since the Great Recession.
That may “fix” home prices but not the important thing to most, monthly payments.
Where I live, the local government decided to remove zoning thereby allowing more varieties of properties.
Price comes down in the sense that the missing middle provide options between condo to townhouse to detached
As a layperson I have a feeling that's not going to happen. The working class has too much wealth tied up in their homes because US society and the government have encouraged people to treat it as a store of wealth instead of a box that shields them from the weather. People talk constantly about "getting on the property ladder", "buying more land because they aren't making more of it", "having a landlord side hustle", etc. A house is a lot more tangible than stocks so people without knowledge of finance feel much better about investing in one (understandably so - also forget about Social Security). Combine this with associated government tax subsidies and mortgage underwriting programs and you've basically created a situation where home prices can't do anything but go up.
Look at the amortization table for the proposed 50 year mortgage: borrowers wouldn't be making a dent in the principal for a good 10 or 15 years. The underlying assumption here is that people would make money via home price appreciation, i.e. speculation, not from creating an actual store of value. We already kicked this can once when the 30-year mortgage became a thing 60 years ago.
Of course one can't draw the current trend line into infinity because of affordability but I highly doubt it'll go down appreciably. I also don't know enough to have a solution to this problem - any ideas?
that's because "more supply" hasn't been anywhere close to enough supply, judging by historical housing needs by population age demographics. More supply is absolutely the key thing missing, but it needs to be a lot more supply.
https://www.axios.com/2023/12/16/housing-market-why-homes-ex...
Not all of those empty houses will be places people want to live in, but I'd bet a fair amount of them are perfectly fine places people would love to call home if they could only afford them.
How would the stay-at-home parent get a bad deal here?
The trends [0] are clear. As society offers people more comfort they have less children. Often radically so, having a GDP per capita of above $30k basically means that people stop having enough babies to hit the replacement rate.
It’s a similar type of issue - of course individuals don’t want to submit to a painful process with high risk and sometimes dubious value to them individually if they have other choices.
Most places in the developed world aren’t currently drafting large portions of their population for military service - and a large portion of the population says they’d fight it if they did. Maybe at some point, they wouldn’t have a choice - or the choice would be made very expensive for them to make the other way.
I suspect it will be similar for birth rates too.
I can get a microwave for ~$60.
I can get a decent used cell phone for ~$100.
Appliances are a little more expensive, but I can get a washing machine for ~$300, less if I go to facebook marketplace.
But in my area, a victorian house that's litterally crumbling with no central cooling and not up-to-code wiring where you can't run a hair dryer and coffee machine at the same time?
$180,000
Cost of rent at a similar quality house half the size?
$1600/month
Modern comforts are not the reason people can't afford to live.
that's when I knew it was time to leave the uk.
at least the us & most non eu countries have cheap power. which means better standards of living.
Try to do it now - what about pregnancy leave? Post-birth leave even in situation with no health complications for mother and child? Creche? Pre-school? Post-school activities? Frequent visits to doctors. And so on and on. When are we supposed to do so with our active even if just normal careers? These are massive costs even in Europe, must be absolutely crushing in US.
People come home at the evening, drained from work. Who can efficiently handle well more than 2 small kids on top of all that and other duties that life daily puts on each of us?
There are studies showing that happiness of parents peaks with 2 kids, and 3rd is already a dive into less happiness for most and it doesn't stop there. So massive financial, time and energy costs to reach even replacement rate are not worth it.
We have 2 kids and somehow managing without nanny or parents nearby. 2 families of peers who have 3 kids are almost impossible to get together with - they are barely managing somehow, most of the time, always late by an hour or two to any meeting. Its really a massive jump in complexity. For more, you properly need a nanny or close family helping out massively, it just doesn't work with 2 people working without hitting burnout or two.
But then its delegated parenting - why even bother with more kids if you don't raise your own kids, donate sperm or an egg if you just need to tackle a checkbox in life. Parenting needs are more than fulfilled with 2 kids. If state needs more it needs to create something better than 2-3 decades of nightmare to raise them for regular folks. State help even in Europe (or lack of it) is not something motivating to have more kids.
> But in my area, a victorian house that's litterally crumbling with no central cooling and not up-to-code wiring where you can't run a hair dryer and coffee machine at the same time?
> $180,000
I'm not familiar with the market you're talking about. What is the median wage in the area that we're comparing $180,000 to?
> You've forgotten electricity, depreciation and the need for the house to be wired up to support all the gear. The figures you're quoting are just the price for a one-off purchase, not the total cost of ownership.
Cost of total rewire was quoted $30,000. We didn't end up buying that house, but 30k is honestly a drop in the bucket when you're talking about numbers as huge as 180k. So no, the inclusion of electrical wiring is not some big expense that's making housing unaffordable. And houses had electricity in the mid-to-late 20th century... You know, back when it was reasonable to expect to be able to buy a house on one income without even a college degree.
Our electricity bill is usually ~$200/month. This is not what eats most of our paycheck. Our mortgage is far and away our biggest expense.
If houses still costed 20k (a price that many older folks have told me they bought a house for), even with a full rewire bringing it up to $50k, some kid working at Walmart could own a house. Now both renting and buying are prohibitively expensive, and it has nothing to do with modern amenities.
Housing costs are outrageous, far beyond the rate of inflation. That's why many can barely pay their bills. Not because we have electricity and washing machines and and microwaves.
It's 15%. That is a substantial chunk of the whole.
> Our electricity bill is usually ~$200/month. This is not what eats most of our paycheck. Our mortgage is far and away our biggest expense.
Your mortgage is what, 20 years? $200 x 12 x 20 ~= $50,000, and around 25% of the mortgage principle. We've found 43% (almost a half house) of the cost so far in the electricity alone. Wiring it up and running the grid aren't cheap. I've always suspected it is illegal to build & sell a house without electricity otherwise there'd probably be a brisk market in them as a cheap option, the savings potential is there.
But that isn't the point, I can't tell if $180k is large or small without a median income to compare it to. If people in the area are earning $90k/yr then it might technically be cheap. A ratio of 3 I think is usual for the 70s.
> If they're happy to do it to 1970s standards, probably most of them [could support a family on one income with an ordinary job].
Our house has the same electrical wiring that it did in 1969. The couple that sold us the house told us they bought it for $20k, which means a cashier could have afforded it back then, but now it's too expensive. Therefore, the fact that it has electricity has no bearing on whether it's prohibitively expensive for most people, and I can make a similar argument for any house built in the mid 20th century.
>Your mortgage is what, 20 years? $200 x 12 x 20 ~= $50,000, and around 25% of the mortgage principle. We've found 43% (almost a half house) of the cost so far in the electricity alone. Wiring it up and running the grid aren't cheap. I've always suspected it is illegal to build & sell a house without electricity otherwise there'd probably be a brisk market in them as a cheap option, the savings potential is there.
Practically all houses had electricity in the 70s. So this is already contradicting what you said earlier if you're citing electricity as the reason no one can afford a house on one income.
>It's 15%. That is a substantial chunk of the whole.
It doesn't matter if it's substantial. I'm only saying it's not so much that it's the reason no one can buy a house and support a family with an ordinary job.
Median income doesn't matter to my point. Housing prices have skyrocketed to the point that most people can't buy a house on one income. No one who's paying attention can deny this fact with a straight face, and your claim that it wouldn't be true if people lived by "1970s standards" is easily proven false by the fact that houses that were built in the 1970s with all the exact same amenities are still overpriced way beyond inflation.
The fact that a Victorian house that's falling apart to the point of being dangerous was listed ANYWHERE for $180,000 serves my point.
Point is that one working man isn't enough horsepower to support a family to modern living standards and never has been. The standard that one person could support was low and in practical terms has only improved over time.
> Median income doesn't matter to my point. Housing prices have skyrocketed to the point that most people can't buy a house on one income.
It matters a lot, that can't be asserted that without considering the ratio of income to house prices - the median income, in nominal terms, has skyrocketed too. Whether the median income or house prices rocketed more and by how much is quite material. If male full time earners are making $90k/year in an area, for example, then a $180k/year house could be said to be quite affordable to a single-income family.
If house prices in my area dropped to $180k then people would be talking about how wonderfully cheap housing had gotten and how great it was now that every young couple could afford a house.
> So this is already contradicting what you said earlier if you're citing electricity as the reason no one can afford a house on one income.
I don't think I actually said that initially, but the numbers you've quoted have convinced me it is at least partially true. The electrical costs appear to be comparable to the amount of money that the house cost according to the numbers you suggested. That is a significant factor in what people can afford. If they avoid almost half a house's worth of expenses then that will go a long way towards being able to afford a house.
[0] https://www.bls.gov/cps/demographics/women-labor-force.htm
https://www.usinflationcalculator.com/ suggests that’s almost exactly $180K in 2025 dollars…
If we completely ignore the commonplace role of the maid, nanny or domestic helper — women in 1965 spent the same amount of time on child care and only about 10 more hours on housework a week than women in 2011. According to the 1870 census, “52 percent of employed women worked in ‘domestic and personal service.’” From 1870 through the mid-1900s, that percentage only increased.
https://www.theatlantic.com/business/archive/2015/09/decline...
//much less in the way of microwaves and washing machines and whatnot
The CPI accounts for these as 'hedonic quality adjustment'.
It's always convenient to benchmark this against 1970s onwards as it was the first year that data on race and ethnicity was included in the income statistics. However 1970 is also a recession year which bottomed out the market and eventually led to an oil crisis for most of the decade.
Adjust for inflation to 2023 and its inarguable.
New house: $23,450 -> $174,468 Average Income: $9,400 -> $69,936 New car: $3,450 -> $25,668 Minimum Wage: $2.10 -> $15.62
It seems impossible to do this in 2025 with white collar work because so much of it is tied to HCOL cities (except for hedge funders, FAANG workers who got lucky on timing, bankers, some lawyers.)
From what I can see amongst friends and family -- it is possible with blue collar trades jobs where you can be selective on where in the country you can live and where you have some level of ownership of your practice. There are numerous affordable locations in the country.
I can confirm -- based on how difficult it is to get an appointment -- that my tree guy, electrician, and plumber all make more than me as an executive. Some of these workers further force payments in cash, so they are probably not even paying tax on all their income.
Thanks for the link, it was interesting.
Also the very hidden caveat of low or no tuition fee in some other countries is that you study in their language, not English.
Besides, it is not possible to finish med school without working a couple years as an intern.
Fewer kids == more investment per kid == more competition for high quality everything == more costs.
Also, more workers in the labor force (aka fewer SAHM’s, etc) == more competition for labor == lower cost for labor (vs historic trends) == can buy less with an hours labor.
The ratio of pay for an hours work to a daycare hour is at historic highs, and there is a reason for that.
If you look at women’s participation in the workforce and overlay it with ratios of worker pay vs buying power, it’s a pretty obvious correlation. There is a reason that labor has been losing ground since the 70’s, and it’s largely because birth control means that women can put off having kids (while still meeting needs like having sex and being in relationships) in order to work and make money and be independent.
The issue here is - whatcha going to do about it?
Most women I know eventually want kids, but then they get screwed by all the younger women who don’t yet want kids making the market, ahem, not very amenable.
And they’re caught in the rat race, which is its own kind of miserable, especially when everyone is competing for the same slots, instead of the roughly half that was the historic norm.
There really is no free lunch though - plenty of horror stories from before too.
Is it really true that this is not known? Although I only claimed correlation (and am thus surprised that I was downvoted twice, as that claim is obviously true), based on the famous "robustness" of this observation, I strongly suspect that confounding factors like those you mention have already been analysed to death, and found not to eliminate the explanatory power of women's education.
At least, checking these confounders seems an obviously valuable and interesting avenue to explore. If it hasn't been done yet, I wonder what social scientists are doing instead.
I doubt it, because the xUSSR is an obvious counterexample.
Access to condoms is probably a bigger factor.
Unfamiliar with USSR -- is the birth rate high there despite lots of educated women?
Kids can be fun but also can be really exhausting.
How many kids are really born just for having am offspring and not because of other reasons.
If people can consciously decide to have or not to have kids my bet is on falling birth rates.
For stable population you need two kids per couple and first could be an eye opener that children are a lot of work.
Genuinely curious - what are some reasons to have kids aside from “just having offspring”?
If you are jumping around from project to project, odds are that lack of commitment stems from lack of pressure.
No one wants pressure though… it’s hell.
While that's true, things are much worse here than they were in several different dimensions.
But let's say I did accept your premise, I still don't think financial security drives birth rates. In 1957, almost 10% of teenage women gave birth. Do we think 1957 teenagers were having babies because they were all homeowners with secure, well paying jobs?
It used to be that whether your child made it through childhood was up to God due to the massive number of risk factors beyond the parents' control. Those risk factors are much more easily mitigated in developed countries, so now the responsibility rests solely on the parents, and that's why kids can no longer go outside.
I am not trying to blunt social criticism. The redistribution of wealth is a real thing that started in the tax policies of the 1980s that we just can't seem to back away from.
But a lot of people are pushing gambling, crypto, options that are telling people that they have no hope of getting ahead just by working and saving. That's not helpful.
Statements like this are not particularly meaningful unless there is actually a supply of 1600 sqft houses that are proportionally cheaper, otherwise you're just implying a causal relationship with no evidence.
All this means is there are enough buyers who can afford 2,800 sqft houses to keep builders from wasting a lot on a 1,600 sqft house. There could be a lot more people who want a cheaper 1,600 sqft house (including some of the 2,800 sqft house buyers!) than who want 2,800 sqft houses, but the market will keep delivering the latter as long as the return is better (for the return to improve for 1,600 sqft houses, see about convincing towns and cities to allow smaller lots, smaller setbacks, et c).
So there's a limited supply of lots (or of permission to use those lots).
There is, however, a monopoly on issuing building permits.
Most of the people I see working in tech can easily afford this. Maybe not private schools or McMansions but the basics are pretty easy. Sure if you're a humanities major with health problems its tough.
https://www.bls.gov/ooh/computer-and-information-technology/...
https://www.zillow.com/home-values/102001/united-states/
https://www.calculator.net/mortgage-calculator.html?chousepr...
I feel like most people would get value out of that.
Most recent example from a few days ago 'How do I change settings around spacing for "heading 2" in a document?'
That wasn't true in the rest of the world.
The US had a unique position due to ww2 that was bound to errode.
I find it funny to compare horror stories from my parents/grandparents to this...
If you want a picture of the future: imagine a robotic boot, stamping on a human face that's begging for more techno-stamping, forever.
Make it 50 years https://fredblog.stlouisfed.org/2023/03/when-comparing-wages...
And that was all because they needed to show to the communist countries how much better capitalism was.
Now communism is gone so there's no need to show off.
Have you considered that there's more to human existence than to pay a mortgage and women are not something you keep in your house to watch after your offspring so they can do the very same when growing up?
Owning a home and having a parent be able to stay home with your children, husband or wife, are important pillars of a stable life. Who wants a society in which couples don't have time to parent their children or manage their household?
It's a fact that seeing to your children's education and social life, cleaning, cooking, and all of the other non-sexy activities of running a household are a full-time job. It doesn't need to be the wife that does that, but it's best when somebody in the family can.
I'm with you but I think we're in the minority nowadays. "Progress" seems to mean paying someone else (who cares a lot less about your children than you do to) to raise your children starting from the moment that maternity leave ends. But at least you get to live close to a big city, and I guess our GDP is a little higher.
This is borderline sexist.
> and the plummeting birth rates show it
Those or, IMO, mostly due to the invention of the pill.
This the real reason why billionaire exists, not because they have a lot of money, though that help, but because they were able to build modern monopolies. The solution is to tax, dismantle, or regulate them, and that includes land.
Georgism and LVT proposals are starting to see a slow resurgence in the political landscape.
The answer that immediately springs to mind is that women, ethnic minorities, and the urban poor all did relatively badly in the 1960s. With the latter two categories, for every apple pie home with a sedan and two kids there were umpteen other drafty tenement flats with malnourished families sharing a bedroom:
British tenements
https://www.theguardian.com/artanddesign/gallery/2021/feb/02...
NYC tenements
https://www.nypl.org/blog/2018/06/07/tenement-homes-new-york...
It’s not one thing or another — many factors have contributed to what feels like change this way or that over the years — but I try to never forget just how abominably crap life used to be for quite a lot of people, and just how much better it is these days.
The common theory I've heard is that the rest of the developed world was still recovering from WW2.
Perhaps it has more to do with the lower ratio of people crippled by household debt to pay for housing, healthcare, and education. There's nothing more K-shaped than debt, which is a lever for those with wealth and a weight for everyone else. It's a combination of bad policy and greed that put us where we are.
You could build a manufatured house for ~$60000 or a couple or years salary like https://siphouse.co.uk/product/insulated-summer-house-with-v... if it wasn't for planning laws preventing it.
or https://www.claytonhomes.com/homes/36TRU28684RH/ Maybe 2x that for govt sponsored high rises like they have in Asia
That may look basic but is similar to what you could get in the 1960s. I mean what do you actually need?
I think we may need a return to slightly more lefty policies - still free enterprise but everyone has a right to a reasonable home and ok income (healthcare etc)
It's neither. None of that is about technology, and it's not the first time in history that it happened either.
And if AI somehow replace a third of the workforce, it's still not enough of an structural change to make technology a cause. If it goes way above that, it can be different, but it's not right now.
The book Capital in the 21st Century comes to the conclusion that this is a historical anomaly due to World War II (and really only in the US, and really only for white families in the US). Don't take the anomaly of the past and treat it as the normality of what people in history experienced.
Wasn't like that in 1800s, or the 1910s, or the Great Depression, etc.
World Wars happened and all of the industrial nations got bombed to hell and lost a generation or two.
The US didn't have that happen and was able to provide unprecedented prosperity for the Greatest Generation and Boomers because it would take 30+ years to truly rebuild and grow their population.
Sure enough the wheels started falling off in the 70's and 80s, and only technological growth kept the US on top. And that's slipping.
At least one sci-fi author has gamed this out:
We have no basis for seriously considering this hypothetical when it comes to LLMs.
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?
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.
In the AGI Succeeds scenario, the situation is unprecedented and it's not clear how it ever gets better.
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.
In the Classical Period, it was the citizen soldiers of Rome and Greece, at least in the west. These produced the ancient republics and proto-democracies.
Later replaced by professional standing armies under people like Alexander and the Ceasars. This allowed kings and emperors.
In the Early to Mid Medieaval time, they were replaced by knights, elites who allowed a few men to defeat commoners many times their number. This caused feudalism.
Near the end of the period, pikes and crossbows and improved logistic systems shifted power back to central governments, primarily kings/emperors.
Then, with rifles, this swung the pendulum all the way back to citizen soldiers between the 18th and early 20th century, which brought back democracies and republics.
Now the pendulum is going in the opposite direction. Technology and capital distribution has already effectively moved a lot of power back to an oligarchic elite.
And if full AGI combined with robots more physically capable than humans, it can swing all the way. In principle a single monarch could gain monopoly of violence over an entire country.
Do not take for granted that our current undertanding of what the government is, is going to stay the same.
Some kind of merger between capital and power seems likely, where democratic elections quickly become completely obsolete.
Once the police and military have been mostly automated, I don't think our current system is going to last very long.
If you truly get AGI, you are highly unlikely to be able to reliably control it let alone nationalise it. And it is highly unlikely that only a single country would reach it. Chances at least one other country would. And AGI would be eventually weaponised against other countries successfully or not.
the changes of AGI causing huge damage in the world would be very real. Unlike a WMD, the damage isn't necessarily visible, immediate or obvious.
And Nvidia would be left in a weird place where the vast majority of their profits are coming from AI cards and demand would potentially dry up entirely.
We were not pushing 40 trillion in debt at the time of the great financial crisis.
The TARP was a max of 700 billion and we didn't even disburse all the funds.
Trying to do a bailout of this size could easily cause a crisis in the treasury market. Then we really are in huge trouble.
Don't see why they would need rescuing.
Ofc, this does lead to ever increasing paper valuations. So maybe that is the win they are after.
> I honestly don't see a third option unless there is government intervention
Bailouts are government intervention. The third option is an absence of government intervention, at least at the business level. By all means intervene in the form of support for impacted individuals, e.g. making sure people have food on the table. Stop intervening to save businesses that fail.
The slimmer part is any potential successors suddenly responding to the people, but maybe that happens in congress in 2027. Still up in the air.
Duh, if they reduce headcount then they will have fewer people in their department, which will negatively affect their chances for promotion and desirability of their resume. That's why they actually offshore the jobs to India and Southeast Asia; it lets them have 3x+ the headcount for the same budget.
If you want to have them actually reduce headcount, make org size the denominator in their performance reviews, so a director with 150 people needs to be 15x more productive than a manager with 10, who needs to be 10x more productive than the engineer IC. I guarantee that you will see companies collapse from ~150,000 employees to ~150, and profit/employee numbers in the millions (and very likely, 90% unemployment and social revolution). This is an incentive issue, not a productivity issue. Most employees and their employers are woefully unproductive because of Parkinson's Law.
You'll never see a manager or even a managing-CEO propose this, though, because it'll destroy their own marketability in the management job market. Only an owner-CEO would do it - which some have, eg. Valve, Nintendo, Renaissance Technologies. But by definition, these are minority employers that are hard to get into, because their business model is to employ only a few hundred people and pay them each millions of dollars.
> Who is going to be buying the products and services if no-one has money to throw around?
I've wondered about this myself. People keep talking about the trades as a good path in the post-AI world, but I just don't see it. If huge swaths of office workers are suddenly and permanently unemployed, who's going to be hiring all these tradesmen?
If I were unemployed long-term, the one upside is that I would suddenly have the time to a do a lot of the home repairs that I've been hiring contractors to take care of.
The other thing I worry about is the level of violence we're likely to see if a significant chunk of the population is made permanently unemployed. People bring up Universal Basic Income as a potential, but I think that only address a part of the issue. Despite the bluster and complaints you might hear at the office, most want to have the opportunity to earn a living; they want to feel like they're useful to their fellow man and woman. I worry about a world in which large numbers of young people are looking at a future with no job prospects and no real place for them other than to be made comfortable by government money and consumer goods. To me that seems like the perfect recruiting ground for all manner of extremist organizations.
Or we could just give people money and let them do as they wish with it, and trade off between their needs and wants as they see fit (including the decision of whether they want to work to obtain more of their wants).
We can iterate on the exact amount. There are difficulties with UBI but figuring out the amount is a pretty minor one.
Any UBI that avoids people getting poor will have to come mainly form taxes, and will mostly not make any bit of inflation.
The typical answer is "printing money causes inflation", but in the context of this feedback loop, it only causes exactly as much inflation as is required to cancel out the deflation caused by automation-induced layoffs and productivity increases. That's the magic of feedback.
But if it's because the resulting UBI would still be insufficient for welfare, we could also use taxes to fund a secondary "revenue-neutral" layer of UBI that taxes the rich and redistributes to everybody, but probably it makes sense to go in slower steps, seeing what level the primary UBI stabilizes at and then adding a secondary tax-funded one if the primary one isn't sufficient for both welfare and sustaining economic demand.
(The secondary UBI would probably still be somewhat inflationary, even though it's funded by taxes, just because poor people spend more of their money on things that are highly-weighted in the CPI, but the feedback loop will balance that out).
"Professionals were 57.8 percent of the total workforce in 2023, with 93 million people working across a wide variety of occupations" [1]. A reasonable worst-case scenario leaves about half of the workforce intact as is. We'd have to assume AI creates zero new jobs or industries, and that none of these people can pivot into doing anything socially useful, to expect them to be rendered unemployable.
> if a significant chunk of the population is made permanently unemployed
They won't. They never have. We'd have years to debate this in the form of unemployment insurance extensions.
[1] https://www.dpeaflcio.org/factsheets/the-professional-and-te...
Zero American jobs, sure. It's clear that these american industries don't want to invest in America.
>They won't. They never have.
not permanent, but trends don't look good. It doesnt' remain permanent because mass unemployment becomes a huge political issue at some point. As is it now among Gen Z who's completely pivoted in the course of a year.
Were there less weavers with machines now doing the job (or whatever?). Sure. But it balances out. It’s just bumpy.
The big change here is that it’s hitting so many industries at once, but that already happened with the personal computer.
Or you know, don't do that and buy a home when you are 40 instead of 25.
People who do save an have good discipline, and don't have children to early still do pretty well.
The culture of 'yolo just get a credit card with 18 and max it out for video game skins' is literally losing people 100000s over their lifetime.
Yes buying a house is not as easy as before, but the doomerism a solution. You can rent and be save. Renting isn't inherently worse for you in the long, that just myth.
* 400
The PC was pre-NAFTA, and since then we've had at least 3 waves of tech trying to outsource tech jobs (let alone actually impacted jobs like manufacturing) to cut costs. We're now on the current wave.
More stuff can be made... just not in the US.
No worries, they'll just make AI robots to shoot people.
I think that's good thing.
Not necessarily. If AI improves productivity, which it hasn't very much yet, there is the option to make more stuff rather than the same output with less people.
The Luddites led on to Britain being the workshop of the world, not to everyone sitting around unemployed, at least not for a while.
Here's hoping we figure that out soon otherwise we're going to see how long it takes the poor to reinvent the guillotine
Personally I'm kind of hoping for sooner than later. The greed and vice of the upper stratosphere in society is wildly out of control and needs to be brought to heel
Let me answer your question with another question - if the population pyramid is inverted and birth rate is like 1.1 babbies per 2 adults.. then how is any market going to grow? Seems to me all markets with halve. On top of what you pointed out. Or I suppose it's a happy accident if our workforce halves as our work halves - but still the consumer market has halved. It does make me wonder under what reality one would fathom that the stock market would go up long term.
If AI is somewhat successful at automating knowledge work, what feasible job could exist that doesn't require your mind or body?
Services like healthcare and plumbing aren't going away of course, but there's not enough demand to support an economy on those jobs.
In my opinion the whole economy needs a rethink regarding what our actual goals are as a society, and maybe AI will force that conversation to happen, but I'm sceptical if it'll be a well-considered consensus.
Very few office jobs in bigcos, but it does mean that you'll not need as much capital as before to start a business and compete with existing incumbents.
Take the POS market for example. It's relatively trivial to setup your POS system in dbase/foxpro/MS-access. Yet almost every shop uses lightspeed/toast/square because they don't want to take on the additional burden of maintaining it and want support. They also hire web developers/designers to make their website even though framer/square space are super easy to use.
With AI I think what's happening is that more competitors are challenging these incumbents leading to downward pressure on pricing. Which is great for customers!
> Not sure why people keep bringing up entrepreneurship as if that couldn't be automated.
Ah, how would you automate entrepreneurship? This isn't the matrix where AI will suddenly wake up one day and start an entrepreneurship journey.
If AI automates jobs, POS system vendor is using an AI to run the business. You can do that yourself and remove the middle man.
re: "Ah, how would you automate entrepreneurship?"
I meant that every non-physical business need that would be filled by a local business can now be filled by the same AI you have already use to automate half the jobs away.
There is this fantasy where employers can replace workers with AI but businesses cannot replace their software vendors with AI
If they work they will ruin a any society where income is based on labor.
So AI either destroys capitalism or society.
Nobody. It's a joke. The reason China could do this is because they were selling to the world. Our idiot elites don't even believe that it's bad to run massive trade deficits every year, while watching the gradually increasing strength of every exporting country.
A great movie about this that I watched recently is Der VW-Komplex (https://www.youtube.com/watch?v=pBRIzhbTFUA), where I learned that in the late 80s fully 10% of Volkswagen's output was purchased by Volkswagen's employees. Bitomsky was already asking "what will the robots buy?" And watching a management that seemed to think of human needs and desires as an annoying complication of machine and product design.
> The problem becomes that eventually all these people who are laid off are not going to find new roles.
I will note again that middle class people are completely unsympathetic to this problem until it affects them. They're like "Just learn Spanish!" "Just become programmers!" i.e. just be like me, who planned ahead and was quiet in class and is exactly where I belong. Complete idiot answers given by somebody who isn't worried about their own position in society at all.
Almost every independent retail business closed down because the US wouldn't tax imports or Amazon purchases, every small town in the US was wrecked and every Front Street filled with boarded up storefronts or rotating unprofitable boutiques run by the wives and children of rich men, and the upper middle class just laughed, looked down their noses and complained about their taxes.
I suggest gig work. The people who own the machines will send you tips through your phone if you pick up the leaves and trash around the gates of their homes.
Of course in reality this does not work like that for large parts of the economy. But even if it was true companies woulnd't gain anything from AI beyond the ability to be briefly more competitive by being ahead of the curve in AI adoption
[0]https://www.morningbrew.com/stories/wealthy-americans-accoun...
If the army was 1000x more “productive” on a dollar basis- would you cut back military spending? No, because everyone else will be 1000x as productive soon. Spend may even rise with efficiency gains unlocking new capabilities/risks.
Of course he’s nervous - what else would you expect him to say?
If I were the gambling man, I would grab my PETS.AI stock and sit tight.
I don't think we're anywhere near the 2000 peak.
At least let OpenAI IPO, and then a few of the LLM wrapper companies to IPO with a ton of hype first.
We're calling the top without an OpenAI IPO first? That seems crazy to me.
Sure!
Google began investing heavily in AI (LLMs, actually) to catch up to the other frontier labs, which had already produced a product that was going to eviscerate Google Search (and therefore, Google ad revenue). They recognized this, and set about becoming a leader in the emerging field.
Is it not better to be a leader in the nascent industry that is poised to kill your profitability?
This is the same approach that Google took with smartphones. They saw Apple as a threat not because they had a product that was directly competing, but because they recognized that allowing Apple to monopolize mobile computing would put them in a position to take Google’s ad revenue — or allow them to extract rent in the form of payments to ensure Apple didn’t direct their users to a competing service. Android was not initially intended to be a revenue source, at least not most importantly. It was intended to limit the problem that Apple represented. Later, once Google had a large part of the market, they found ways to monetize the platform via both their ad network and an app store.
AI is no different. If Google does nothing, they lose. If they catch up and take the lead, they limit the size of the future threat and if all goes well, will be able to monetize their newfound market share down the road - but monetization is a problem for future Google. Today’s Google’s problem is getting the market share.
Even in this conservative case, ChatGPT could seriously erode Google Search revenues. That alone would be a massive disruption and Google wants to ensure they end up as the Google in that scenario and not the Lycos, AltaVista, AskJeeves etc. etc.
Panicking, and therefore making horrible design and product choices.
Google has made their main search engine output utter and complete junk. It's just terrible. If they didn't have 'web' search, I'd never be able to use it.
In almost every search for the last month, normal search results in horrible matches. Switch to web? Bam! First result.
Not web? The same perfect result might be 3 or 4 pages deep. If that.
(I am comparing web results in both cases, and ignoring the also broken 80% of the pages of AI junk.)
In an attempt to compete, they're literally driving people to use ChatGPT for search in droves.
They could compete, and do so without this panicky disaster of a response.
> If Google does nothing, they lose.
Is any of that actually true though? In retrospect, had google done nothing their search product would still work. Currently it's pretty profoundly broken, at least from a functional standpoint--no idea how that impacts revenue if at all. To me it seems like google in particular took the bait and went after a paper tiger, and in doing so damaged their product.
Tech nerds know what ChatGPT is, they know llm limits somewhat and they know it's hallucinating. Normal people do not - for them is a magical all knowing oracle.
Yep, and it’s hard to communicate that to them. It’s hard to accurately describe even to someone familiar with the context.
I don’t think “trust” is the right word. Sitting here on 19 Nov 2025, I do in fact trust LLMs to reason. I don’t trust LLMs to be truthful.
If I ask for a fact, I always consider what I’d lose if that fact were wrong.
If I ask for reasoning, I provide the facts that I believe are required to make the decision. I then double-check that reasoning by inverting the prompt and comparing the output in the other direction. For more critical decisions, I make sure I use different models, from different providers, with completely separate context. If I’ve done all that, I think I can honestly say that I trust it.
These days, I would describe it as “I don’t trust AI to distinguish truth”
You must know the limitations of the medium but searching for how much and at what temperature should i bake my broccoli is so fucking annoying to search on google
Anecdotally, I believe they did.
My wife is decidedly not a tech nerd, but had her own ChatGPT subscription without my input before I switched us over to a business account.
My mother is 58, and a retired executive for a “traditional” Fortune 100 company. She’s competent with MS productivity tools and the software she used for work, but has little interest outside that. She also had her own ChatGPT subscription.
Both of them were using it for at least a large subset of what they’d previously used Google for.
Problem for Google is that for a good chunk of normal non-techy people LLM chats looks like talking to genius super intelligence and they was not burned by it yet. So they trust it.
And now good chunk of non-tech people now go and ask ChatGPT instead of using google search. And they do it simply because it's less enshittified than Google search.
I know the tech itself is real and people do use it. And it will certainly change the world. Yet I doubt even fraction of money burnt on it will ever be recuperated because race to the bottom.
But yeah - I'm just random tech guy who has not built a big successful company and honestly have very little clue how to make money this way.
Hey, me too :)
I’ve been at this for a couple of decades, though, and from what I’ve seen the key to building a “successful” company is to ride the wave of popular interest to get funding, build an effective team, and then (and only then) try to find a way to make it profitable enough to exit.
I do think “AI” (really, LLMs, and GPTs in particular) are going to have a transformative impact on a scale and at a rate we’ve never seen before - I just have zero confidence that I can accurately predict what it’s going to look like when the dust settles.
¯\_(ツ)_/¯
I don’t think it matters.
Google has the capital to spend, and this effort needn’t succeed to be worthwhile. My point is that the scope of the potential future risk more than justifies the expense.
> and in doing so damaged their product
Only in objective terms.
The overall size of the market Google is operating in hasn’t changed, and I’m not aware of anyone positioned to provide a better alternative. Even if we assume that Google Search has gotten worse as a result of this, their traditional competitors aren’t stealing marketshare. They’re all either worse than the current state of Search, are making the same bet, or both.
What, you don't want to ship the Torment Nexus? You're fired! We must ship a Torment Nexus, we must maintain our market share even if it means our destruction!
I'll take a stab at this. It's not 100% clear to me which product you're referring to, so I'll try to answer as if the product is something that already has customers, and the maker of the product is shoving AI into it. The rationale is that the group you're trying to convince that you're doing a good job is your shareholders or investors, not your actual customers. You can justify some limited customer attrition by noting that your competitors are doing the same thing, and that maybe if you shove the _right_ AI features into the product, you'll win those customers back.
I'm not saying it's a _good_ rationale, but that seems to be what's at play in many cases.
If there's something more specific and different you were referring to I'd love to hear what it is.
I don’t really see this. Lots of people like freebies, but the value aspect is less clear. AFAIK, none of these chatbots are profitable. You would not see nearly as many users if they had to actually pay for the thing.
> "It doesn't matter whether you want to be a teacher [or] a doctor. All those professions will be around, but the people who will do well in each of those professions are people who learn how to use these tools."
Bullshit. Citation very much needed. It's a shame--a shameful stain on the profession--that journalists don't respond critically to such absurd nonsense and ask the obvious question: are you fucking lying?. It is absolutely not true that AI tools make doctors more effective, or teachers, or programmers. It would be very convenient to people like Pichai and Scam Altman, but that don't make it so.
A small startup now has the chance to compete with incumbents without raising from VCs.
Not talking about you, but I think cynics just look at it with too much pessimism and therefore can't see it.
And Startups and SMB's are more open to attributing it to efficiency gains due to AI.
If you aren't seeing it then probably it's because you are in a niche vertical. Which is great for you, but not representative on the whole.
Chat GPT just happened to come out around the same time so we get all this misattribution
And yet, every time somebody not paid by the AI companies tries to measure it, they don't find it.
def mult2(points): return 2xpoints
Its going to be really interesting what happens to this labor pool once you've finally sunk all the ships youre let aboard.
I think it's very hard to convince AI skeptics since for some reason they feel more threatened by it than rest. It's counterproductive and would hinder them professionally but then it's their choice.
The studies I've seen--and there are very few--seem to indicate the effect is more placebo than pharmacological.
Regardless, breathless claims that I'm somehow damaging my career by wondering whether these tools actually work are going to do nothing to persuade me. I'm quite secure in my career prospects, thank you kindly.
I do admit I don't much like being labeled an "AI skeptic" either. I've been following developments in machine learning for like 2 decades and I'm familiar with results in the field going back to the 1950s. You have the opportunity here to convince me, I want to believe there is some merit to this latest AI summer. But I am not seeing the evidence for it.
As I said the evidence is in companies not hiring anymore since they don't need as many developers as before. If you want rigorous controlled studies you'll get it in due time. In the meantime maybe just look into the workflows of how people are using
re AI skeptics: I started pushing AI in our company early this year, and one of the first questions I got was that "are we doing it to reduce costs". I fully understood and sympathize with the fact many engineers feel threatened and feel they are being replaced. So I clarified it's just to increase our feature velocity which was my honest intention since ofc I'm not a monster.
I then asked this engineer to develop a feature using bolt, and he partially managed to do it but in the worst way possible. His approach was to spend no time on planning/architecture and to just ask AI to do it in a few lines. When hit with bugs he would ask the AI "to fix the bug" without even describing the bug. His reasoning was that if he had to do this prep work then why would he use AI. Nonetheless he finished entire month's worth of credit in a single day.
I can't find the proper words, but there's a certain amount of dishonesty in this attitude that really turns me off. Like turbotax sabotaging tax reforms so they can rent seek.
I hope so, because the alternative is grim. But to be quite honest I don't expect it'll happen, based on what I've seen so far. Obviously your experience is different, and you probably don't agree--which is fine. That's the great thing about science. When done properly it transcends personal experience, "common sense", faith, and other imprecise ways of thinking. It obviates the need to agree--you have a result and if the methodology is sound in the famous words of Dr. Malcolm "well, there it is." The reason I think we won't get results showing AI tooling meaningfully impacts worker productivity are twofold:
(1) Early results indicate it doesn't. Experiences differ of course but overall it doesn't seem like the tools are measurably moving the needle one way or the other. That could change over time.
(2) It would be extremely favorably in the interests of companies selling AI dev tools to show clearly and inarguably that the things they're selling actually do something. Quantifying this value would help them set prices. They must be analyzing this problem, but they're not publishing or otherwise communicating their findings. Why? I can only conclude it's because they're not favorable.
So given these two indications at this point in time, a placebo like effect seems most likely. That would not inspire me to sign a purchase agreement. This makes me afraid for the economy.
Really I only use chat GPT and sometimes Claude code, I haven't used these special-cased AI tools
It doesn’t have to work. It just has to sell and become entrenched enough. And by all metrics that is what is happening. A self fulfilling prophecy, no different than your org buying redundant enterprise software from all the major vendors today.
now that there's a prime quality rare insult
anyway i totally agree with your reasoning. one might as well ask "why is MS Teams so bad? it's bloated, slow, buggy, nasty to use from a UX pov... yet it's everywhere"
this shitware -- ms teams, llm slopguns, whatever -- never had to work, they just have to sell.
Nobody can really know what things will look like in 10 years, but if you have the capital to deploy and any conviction at all that this might be a sea-change moment, it seems foolish to not pursue it.
100% true. Do not invest trillions on such an uncertainty in the long term is always a bad investment.
> but if you have the capital to deploy and any conviction at all that this might be a sea-change moment, it seems foolish to not pursue it.
Gamblers argument: "But what if this is the winning ticket?"
A risky investment is obviously akin to gambling, but to get things built and make a profit you have no other choice.
Are you now equating an investor with some guy in a casino? Sorry, but that seems like a stretch.
I'm saying the risk aspect is similar, but I take issue with equating (product) investment and gambling, since one has a potential to create, and the other just shifts money around.
That's only one article and with only a small focus: Americans only.
U.S. adults are generally pessimistic about AI’s effect on people’s ability to think creatively and form meaningful relationships: 53% say AI will worsen people’s ability to think creatively, compared with 16% who say it will improve this....
Regarding your skepticism about the loss of trust: https://publicpolicy.cornell.edu/masters-blog/what-americans...
One of the most consistent themes in the research is fear of misinformation. In an era where AI-generated content can be nearly indistinguishable from authentic material, the potential for deception is enormous, and people know it. A full 76% of Americans say they are concerned about AI tools producing false or misleading information.
Anyways: https://futurism.com/the-byte/study-consumers-turned-off-pro...
Researchers have found that including the words “artificial intelligence” in product marketing is a major turn-off for consumers, suggesting a growing backlash and disillusionment with the tech — and that startups trying to cram “AI” into their product are actually making a grave error.
If you mean AI Overview, you really need to cite the source of this claim:
> seeing that it drives consumers away from your product
Because every single source I can find claims that Google search grew in 2024[0]. HN is not a good focus group for a product that targets billions of people.
[0]: For example https://www.seroundtable.com/google-search-growth-39040.html but feel free to provide a more credible source that claims the opposite.
With AI summaries being hit or miss, we may say users now need to do 20% more searches to find what they are looking for.
Numbers aren't always a good proxy for customer satisfaction.
Make cars break faster so you can sell more cars.
https://open.substack.com/pub/nothinghuman/p/the-tyranny-of-...
Even if that change is wildly profitable for megacorps in the long run.
Hey now, Google Plus was more than a decade ago. I didn't like it either, but maybe it's time to move on? I think they learned their lesson.
- get customers used to using AI by “gently” cough nudging them towards this in all products.
- get experience and data for your LLMs and AI dev teams regarding what works and what doesn’t
- Bet on AI becoming good enough that people will use this as their entry to the Web, Media and software
- become the largest player of these AI apps, so that you can inject ads again
How did they ignore technological advancements?
They had the tech but didn't see the danger in it, they belived that the lower quality digital camera would fail and investing in them would mean exploring a new market and they choose the safe corporate move, buisness as usual.
Turns out that low quality but way more pratical and cheaper on the long run really sells
“One of Job's business rules was to never be afraid of cannibalizing yourself. " If you don't cannibalize yourself, someone else will," he said. So even though an Iphone might cannibalize sales of an IPod, or an IPad might cannibalize sales of a laptop, that did not deter him.”
Kodak did sell digital cameras but they were so scared of protecting their film business I don't think they went all in on digital and let the other camera companies take over.
Kodak operated in a region that was a manufacturing and technology hub until the mid 1900s. The region started to decline significantly in the 1960s. By the 1990s it was basically a ruins compared to the 1950s.
So by the time Kodak made this strategic mistake, I imagine they already would have had a hard time recruiting talent into that obviously dying region for a decade or so, and many people who were there already were actively leaving the region by that time.
I suspect that in the counterfactual where the region stayed as it was in the 1950s in terms of economic prosperity, Kodak probably could have successfully played catch up once it was clear where the game was going.
So yes they made a strategic mistake, but they did so while simultaneously “brain drain” bleeding out due to other unrelated factors.
Where is your evidence for this part of your claim?
- Steve Jobs
I'm certain Jobs thought there's no need to point that detail, because nobody still living¹ would be dumb enough not to understand it implicitly. Too bad that we have evidence otherwise.
1 - At the worst case, selection bias should make it true.
The AI bubble bursting would be somewhat of an “I told you so!” moment for a lot of people.
And there’s also a large group that’s genuinely afraid to lose their job because of it, so for that group it’s very much understandable.
Whether or not the predictions of the bubble popping are exaggerated or not, I cannot tell; it feels like most companies investing in AI know that the expectations are huge and potentially unrealistic (AGI/ASI in the next few years), but they have money to burn and the cost of missing out on this opportunity would be tremendous. I know that this is the position that both Meta and Google shared with their investors.
So it all seems to be a very well calculated risk.
Depends on the price to use these cloud LLMs.
All i want is some cheap RAM for my PC.
I started working in 1997 and saw the dot com bubble and collapse. If you had asked me in 1999 I thought it would go on forever. I used to get 5 recruiter calls a day. In 2001 I got zero recruiter calls the entire year and it took me 10 months to find a new job.
I saw people at Cisco that had exercised stock options and held on to it at $80 and then it dropped to $20 and they had huge AMT tax bills that they couldn't pay even if they sold everything they had including their house.
My warnings of the AI bubble popping are not just an "I told you so" but also a warning to people to diversify out of their company stock and diversify in general.
Meanwhile, no one in my sphere of tech and non tech people is wanting “more AI” and sees the pros/cons of chatgpt, using it as kinda fancy google search..
Where’s the “killer app” that’ll generate literally trillions in revenue to offset the costs? How do the economics work, especially when GPUs are depreciating?
now go produce 300% as much as you did last year, slave
https://www.bloomberg.com/news/articles/2025-11-19/how-the-p...
A tsunami of rage.
(Won't someone think of the children).
If you're not then you will end up frustrated because it will be as if you have an over-eager trainee that is only slightly less dumb than a box of rocks when it comes to actual thinking but that has near perfect recall about a massive amount of information. A sort of idiot-savant.
I gave it a try for a practical problem to see how long it would take to converge on a solution. It did not, because its reasoning powers simply are not that strong. But it gave me an endless runaround about solutions that this time really would work and never mind all the previous times we did the same thing and it did not work. Between the over enthusiastic tone, the ridiculous confidence level and the jumping-to-conclusions mode that you just simply can't switch off I found the whole exercise more than a little bit frustrating. It never, for even a second expressed any doubt. It never warned when what it responded with was at best extremely low confidence and possibly very wrong (or even dangerous). And this was for a problem where I already knew the solution, it was in some ways entertaining to see the AI blunder about while in full possession of all of the information to see the solution.
'Great, that narrows it down'
'Now I see the problem'
'Got it'
'Ah - perfect'
etc, etc...
If your job involves actual thinking I don't believe you are in danger just yet.
Combining early, faulty "worse is better" technology with a change in cost structure (tokens vs. programers) and capability (programs in minutes not days) often wins. Even when it sucks at first.
Their anti-social tendency is the core problem, remember when they were laying off everyone in tech just because it was a trend? here too, they want to reduce head count instead of increase the value of their products and services to generate more revenue. AI has lots of value for sure. Monetizing that without increasing head count would have been sensible. Instead of getting rid of people, they could focus on freeing up the time of existing people so they can do more work and generate value/wealth for the company. Of course, companies like Google are doing exactly what I'm suggesting to the most part (that I know of), but the vast majority on the ai bandwagon are just there to see if they can make more revenue by having less people.
I don't doubt some big companies in this space will fail, but will that trigger a panic/sell-off? And can the US, after cutting off its allies and alienating the whole world recover? What are the social and geopolitical implications of not recovering?
ZYbCRq22HbJ2y7•2mo ago
Not immune, maybe, but pretty well off if they didn't buy in.