Comment on Everyday AI looks more like the '08 housing bubble
Redex68@lemmy.world 20 hours agoYou do realise that if 50% of consumption disappears then a lot of people from that 90% will loose their jobs as well. I don’t care about the 10%, I also think the income inequality in the US is insane, but the fact is that if AI stocks tank right now, poor people will feel it as well (much more so than rich people, because they can’t survive without a job and don’t have wealth as a safety net)
Knock_Knock_Lemmy_In@lemmy.world 19 hours ago
You are talking yourself into trickle down economics. There is now plenty of evidence that this isn’t true.
There is no need to protect rich people’s wealth so that the poor don’t suffer
Redex68@lemmy.world 18 hours ago
I don’t understand what your point is? I’m merely expanding on OP’s question and stating the fact that the way things are currently, when the AI bubble bursts poor people will feel it the most. Trickle down economics doesn’t work because if you give 100 bucks to a rich person, they’ll spend like 5 of it. If you give it to a poor person, they’ll spend all of it. But that has nothing to do with the fact that if the bubble bursts right now, poor people aren’t going to somehow get any of that money. They will loose their jobs, because the economy slowed down and nobody is buying anything and their jobs aren’t needed anymore. They will just suffer more and rich people will buy up their houses that they now have to sell at bargain prices.
Knock_Knock_Lemmy_In@lemmy.world 18 hours ago
No.
The AI debt creation and investment is not of any benefit to the working class (except for a few construction workers). These data centers don’t create 1000s of jobs. Windsurf has 250 employees. Cursor has 30.
This AI bubble is not affecting general income, only assets. As it doesn’t hit income, it doesn’t hit consumption. Poor people earn and consume. They are asset poor.
A pop in the AI bubble will damage the billionaires, but not the poor.
Redex68@lemmy.world 17 hours ago
But I’m not saying the jobs lost by AI companies collapsing is gonna cause a recession, I’m saying the AI bubble collapsing, bringing down the stock market with it, will cause a recession and loss of jobs. 35% of the S&P is made up of stocks in the top 7 US tech firms. The stock market is extremely skewed towards these 7 firms, and a large part of their current evaulation is made up from speculation of potential AI returns. When the bubble bursts, everyone who is invested in these firms will feel it. As I said, the top 10% of Americans make up 50% of consumption, can’t find a confirmation but I think that’s the highest in modern history. If this 10% suddenly looses 30-40% of their wealth because a stock market crash, this consumption will be severely affected. They won’t buy as many fancy goods, won’t go on expensive vacations, in general will do much less. We can argue whether having a class of people like that benefits the economy or not, I’d say it doesn’t, but the fact of the matter is that if the stock market were to crash because of AI companies, everyone is affected, because of how much money the 10% spend.
Lucelu2@lemmy.zip 14 hours ago
Those data centers drive up energy costs for us and increase global warming. They don’t help at all. Plus AI steals IP of creatives.