Looks more like the dot com bubble to me.
Is it just me, or are the bubbles coming closer together these days?
Everyday AI looks more like the '08 housing bubble
Submitted 2 weeks ago by n7gifmdn@lemmy.ca to technology@lemmy.world
https://lemmy.ca/pictrs/image/00f953ec-388d-4e84-8b1c-02608aa424b3.png
Comments
adespoton@lemmy.ca 2 weeks ago
henfredemars@infosec.pub 2 weeks ago
Yes! The problem is that we won’t accept the full correction that is actually required. We print money, we buy securities, we find ways to prop to reduce the pain but we end up shifting the weakness to other areas of the economy.
WanderingThoughts@europe.pub 2 weeks ago
The amounts going around now are getting too big for a government to cover. Instead of too big to fail, they’re now too big to bail.
Reverendender@sh.itjust.works 2 weeks ago
Like tax paying individuals
architect@thelemmy.club 2 weeks ago
Yep so now when it hits it’s going to be really bad.
NuXCOM_90Percent@lemmy.zip 2 weeks ago
Is it just me, or are the bubbles coming closer together these days?
Yes and no.
Yes in the sense that we have a lot more “fad” economies. There is something new so that needs to be EVERYTHING and the market course corrects, often at the cost of hardship for many.
But “no” in the sense of what “bubbles” tend to refer to. Things like the Japanese Bubble Economy where it causes (I forget if it is officially one but) recessions and even depressions.
The AI Bubble is not going to do that (on its own…). Yeah, a LOT of companies are going to be left holding the bag when they realize LLMs can’t solve all problems for them AND manifest a Cyber Stana Katic to give them a blowie while it does that. But what will they be left with?
- A LOT of “prompt engineers”: This is bad because that is going to be a LOT of people who, increasingly, went to school to get a degree in something with very little utility. That said… Art History majors have been showing us how to do that for decades and at least they did something they loved on their way to service industry jobs.
- For the companies that gutted their workforce over the past few years: A need to rapidly hire talented workers who don’t require ChatGPT to do their job: This is REALLY good for the people who have been hurting and should actually lead to a lot of job mobility… for the old hats who predated this fad
- For the companies that purchased hardware: A lot of edge computing devices are going to be of questionable value. But for the folk who “just” bought a shit ton of GPUs from Daddy Jensen? They have a shit ton of GPUs they can either sell for cheap (not horrible) or repurpose (good)
Don’t get me wrong. There is going to be upheaval and it is going to be bad. But it is also important to remember that drawings like the above are actively misleading and bordering on manipulative. Because basically all the biggies, except OpenAI, have non-AI uses. Oracle ballooned massively because of the OpenAI injection but… they are still god damned Oracle. Same with nVidia who, when they aren’t powering every LLM on the planet, are also one of the companies that makes all the cards that power stuff like computer vision and the like in cars and what not.
Because… remember the dot com bubble? Remember how basically the entire world still runs on The Internet? It was just a case of rebalancing and pivoting for the most part.
All that said… the US is in a really bad way because the fascists have been increasingly gutting the economy and stopping basically any industry that involves manufacturing or communicating with external countries. We are gonna have a massive stock market crash when OpenAI et al pops…
MonkderVierte@lemmy.zip 2 weeks ago
Global economy has inflation since what, middle of the last century? Since slavery and colonies stopped being a thing?
GrammarPolice@lemmy.world 2 weeks ago
NVIDIA really out here selling shovels in the gold Rush
Nalivai@lemmy.world 2 weeks ago
Nvidia are very smart in that regard, ethics aside. Very early on they decided that selling cards to gamers will not give them the infinite growth everyone so desperately desire, so they started looking for what does, and they were consistent at it ever since. Every tech bubble of the recent history is powered by Nvidia cards. How much they contributed to the hype (and damage) is not entirely clear, but that’s not zero for sure
mcv@lemmy.zip 2 weeks ago
They lucked into it. They made their cards for gamers, and various groups, AI researchers, bitcoin miners and others, discovered that they those gamer GPUs were really good for other tasks too. I think it took a while before Nvidia started making specialised cards for those purposes.
I can’t really blame them for serving that market that they just lucked into. I can and will blame them for their terrible Linux support.
KeenFlame@feddit.nu 2 weeks ago
They made gpus long before the gold rush and will not stop after. The usefulness of tensor cores will not dwindle with any market correction. Even before ai boom they were valued astronomically out of reality. Not a single stock is tied to actual selling or owning of anything anymore
Nalivai@lemmy.world 2 weeks ago
Just like shovels existed before the gold rush and will exist after humanity’s death. But we have a saying for a reason
balsoft@lemmy.ml 2 weeks ago
This doesn’t really tell me anything, I’d have to compare it with other charts. E.g. what does the chart for agriculture look like? Airplane manufacturing? Internet in early 2000s?
gandalf_der_12te@discuss.tchncs.de 2 weeks ago
All the economy is a big circle if you draw the circle big enough.
balsoft@lemmy.ml 2 weeks ago
There is no good economic reason to colonize other planets. We have plenty of space here on earth, with conditions already much more hospitable than that of mars - deserts, for example. The resources needed to turn these into habitable land is so much less than the resources required to make even a tiny part of Mars inhabitable (i.e. establish a colony that relies on life support systems) it’s insane to go for Mars first. The reason colonizing Mars is talked about at all is because a rich white dude wants to go to Mars, since deserts are too boring for his spoiled ass.
I actually agree that it would be cool if we went to Mars. But comparing it to white pillaging of the Americas is just incorrect. Mars is not inhabitable by humans, the americas very much were.
AppleTea@lemmy.zip 2 weeks ago
Settling mars is a centuries long undertaking. You basically have to nurture a whole ecosystem from scratch… that would be a brutally difficult and lengthy process in the best of conditions. But of course, these aren’t the best conditions. We aren’t doing particularly well with the ecosystem we’ve already got.
If you want a historical project, then look to balancing modern industry within the planet’s biosphere. It’s a prerequisite to anything happening on mars.
shane@feddit.nl 2 weeks ago
Europeans caused massive death in the Americas. I do not think we should replicate that model.
Also, the chance is small, but there might have been a separate biogenesis (beginning of life) on Mars. Sending humans with our dirty microbiome would almost certainly wipe any evidence of that, and possibly cause an extinction of an entirely separate form of life, which would be a crime even more horrible than the extinctions and genocides which we have caused so far.
Let’s just leave Mars alone until we’ve studies it more and are certain there is no life. Colonizing the moon seems challenging enough for a couple centuries…
Djehngo@lemmy.world 2 weeks ago
I think it’s hard to definitely call something a bubble until it pops.
The definition of a bubble goes something along the lines of market prices exceeding the intrinsic value of the investment they represent, which may be true here?
If you want to read more about this the rough name for these companies was “the magnificent seven” a year or so ago when I last looked at this. A quick Google suggests represent about a third of the SNP 500’s value now and have a cape ratio (cyclicly adjusted price to earnings) of ~37 compared to 15-20 being normal.
I can’t find a good numerical source for the correlated risk within this group, and I suspect analyzing it is very difficult. Given they all used to be a lot more diversified in the past but now a large % of their valuation is predicated on AI historical correlation analysis probably fails. But the diagram linked here suggests it’s probably bad to put all your money in these companies. (Or even a 3rd if you are in an s&p 500 index tracker 😶)
Like, none of this definitively says this is a bubble, since if it were possible to divine that the bubble would immediately pop, but it does suggest there is a strong likelihood we are seeing a bubble.
sugar_in_your_tea@sh.itjust.works 2 weeks ago
~37 compared to 15-20 being normal.
15-20 was normal for the 100 years ending 40-50 years ago. But of we look at the last 40 years or so, the CAPE has been higher, suggesting that we don’t know how what “normal” looks like going forward. More people are buying stocks than ever before due to retirement plans and poor bond yields, which pushes up the PE.
So whether ~40 is high for a PE going forward isn’t clear. The CAPE hit ~45 in the 2000 crash, and reverted to ~20 after the crash, yet the 2008 crash only hit ~26 and crashed down to ~14 and quickly bounced back to ~20. The 2008 had little to do with CAPE and more to do with corruption in the banking industry, whereas 2000 was almost purely oversized hype in the burgeoning tech market.
So is the normal range 20-30? Idk. Maybe 20 is actually low going forward, it’s unclear. Either way, 40 isn’t as outlandish as it was in the 2000s, and that pushed up to 45 before crashing.
there is a strong likelihood we are seeing a bubble.
Agreed. But if you drop out of the market and invest in other stuff, you would miss whatever the rest of the runup will do before it bursts, which could leave you worse off than someone just investing in the entire market by market cap. Ot could continue to run for 10-20 years, or it could pop this year, it’s impossible to know since it relies heavily on investors continuing to believe the hype and companies continuing to have something to back up that hype.
scarabic@lemmy.world 2 weeks ago
I know right? It’s not a bubble if there are transactions between the different companies in an industry. Nothing here shows that these investments are self-supporting circular, nor that all of this is propping up the economy.
Circle != bubble
Gladaed@feddit.org 2 weeks ago
Great point.
llama@lemmy.zip 2 weeks ago
If Lemmy is supposed to be the place where the most tech savvy people in the interest congregate, and everyone in the comments is unsatisfied with AI then we really do have a problem. These companies have all reached a point where they no longer listen to their most informed customer base but instead take 100% of direction from investors who don’t even know what they want except a line going up.
markovs_gun@lemmy.world 2 weeks ago
Eh. Lemmy has a lot of ignorance surrounding technology and science compared to other sites. Hacker News is what you’re looking for if you want somewhere that is full of the most tech savvy people on the Internet, and most of them are extremely pro AI (with some weird AI cultishness alongside). Myself I think AI is a bubble but there is a lot of promise in the underlying technology once you take away the hype, just like the .com bubble at the turn of the century.
Boozilla@lemmy.world 2 weeks ago
Too many people equate AI with LLMs only. LLMs are mostly bubbled bullshit, with a few limited use cases. But AI is a much broader topic. The really scary AI is the stuff we hear little to nothing about.
People also forget how dramatically tech can advance over time. Spoiled impatient Americans in particular want a finished product or they quickly write it off as “garbage”. They forget every product we own and use was once “garbage”.
Bunbury@feddit.nl 2 weeks ago
I am not sure if you have discussed AI in a room full of hackers recently, lol. I have. Maybe 1/100 is pro-AI in my estimation:
KingThrillgore@lemmy.ml 2 weeks ago
Hacker News is a site full of tech cultists and apologists.
axx@slrpnk.net 2 weeks ago
dick_fineman@discuss.online 2 weeks ago
I thought it was the place for people who didn’t want their shitposting interrupted by random child porn. Am…am I in the wrong place???
prettybunnys@sh.itjust.works 2 weeks ago
Unfortunately Lemmy is rife with CSAM too, but the larger instances have done a pretty great job eliminating it.
Smaller instances still get dumped on sometimes.
aceshigh@lemmy.world 2 weeks ago
It’s always interesting to read the experiences of others. The one and only time I stumbled on cp was in the late 90s. Haven’t seen it on reddit or lemmy. Our bubbles keep us isolated.
General_Effort@lemmy.world 2 weeks ago
If Lemmy is supposed to be the place where the most tech savvy people in the interest congregate
Says who? Mostly feels more like sales than R&D here. Which kinda fits with these pitches.
null_dot@lemmy.dbzer0.com 2 weeks ago
I feel like someone working at the pointy end of R&D in AI isn’t necessarily well placed to predict the future of AI.
scarabic@lemmy.world 2 weeks ago
Lemmy is not the most tech savvy people on the internet nor the customer base for AI. Where did you get either of those ideas?
llama@lemmy.zip 2 weeks ago
Because you have to be tech savvy to understand what the fediverse is or how ActivityPub works so it sets the filter for a userbase that evangelizes emerging technology.
HugeNerd@lemmy.ca 2 weeks ago
People need housing, no one needs this AI crap. Even in boring engineering jobs using tools that solved problems decades ago, we are getting AI shoveled in left and right in places no one needs or wants it. And calling old features “AI” is also another problem.
And now these stupid “barking bears attacking fat sleeping people” videos are everywhere, and people seem to think they’re real.
We should focus on natural intelligence first, that is to say each other, and education…
Oh and the headline should read “Every day”, “everyday” is an adjective, like an everyday occurence.
bridgeenjoyer@sh.itjust.works 2 weeks ago
Ai will be the best tool to keep the masses stupid since television.
Octavio@lemmy.world 2 weeks ago
The funny thing about people who say it’s not a bubble because AI has value is that the asset category having value doesn’t prevent valuation bubbles from forming.
Houses have value: you can live in them. Yet there was a housing bubble.
The internet has value: you can watch cat videos on it. Yet there was a dot com bubble.
Tulip bulbs have value: you can grow pretty flowers with them. Yet there was a tulip bulb bubble.
In my experience, whenever you start reading news stories asking if something is a bubble and quoting investment bankers say, “no, it’s not a bubble,” well, usually it’s a bubble.
mistermodal@lemmy.ml 2 weeks ago
The entire US economy has been running off of an asset megabubble that demands global dollar recycling via Wall St. and property for decades now. This is much worse than 2008 as there is no cushioning. We will see what 20+ of doubling down looks like in the end.
UltraGiGaGigantic@lemmy.ml 2 weeks ago
Houses have value: you can live in them. Yet there was a housing bubble.
Was?
Octavio@lemmy.world 2 weeks ago
There is again, but there was, too.
Jaysyn@lemmy.world 2 weeks ago
Except it’s 17x larger & will take the entire US GDP with it.
panda_abyss@lemmy.ca 2 weeks ago
The GDP issue is not because of the AI bubble, it’s because of tariffs and the complete destruction of US soft power abroad
Passerby6497@lemmy.world 2 weeks ago
And I would almost bet the crash will be about the time the Dems take power, just so the Republicans can whine about the situation they created and blame the Democrats for it.
HugeNerd@lemmy.ca 2 weeks ago
Is “US soft power” a euphemism for sowing destruction and proxy wars everywhere? Or do you mean things like the awful show NCIS being barely disguised pro-Israel pro-war propaganda? Like that?
arararagi@ani.social 2 weeks ago
Please let this happen.
HugeNerd@lemmy.ca 2 weeks ago
God damn it, if the US collapses who will supply weapons to all its peaceful democratic allies in the world? I’m super fucking pissed off about this.
ATS1312@lemmy.dbzer0.com 2 weeks ago
But where is Palantir on this? Because they’re connected to actually all of them.
nutsack@lemmy.dbzer0.com 2 weeks ago
doesn’t look a goddamn thing like the housing bubble
PmMeFrogMemes@lemmy.world 2 weeks ago
but the circles
sugar_in_your_tea@sh.itjust.works 2 weeks ago
Can confirm, circles look like bubbles.
CheeseNoodle@lemmy.world 2 weeks ago
I suppose similar in the sense that the housing bubble involved a bunch of rich idiots speculating on bad debt that had been vaguely washed to make it look good and now we have a bunch of rich idiots speculating on AI based on vague promises that it’ll be good.
JcbAzPx@lemmy.world 2 weeks ago
More like the .com bubble but much worse.
vermaterc@lemmy.ml 2 weeks ago
So how dangerous that really is? I assume one day we’ll finally see investors saying “nah, that’s a bubble, I’m not gonna see any returns from those companies, I’m selling”. Then, stock prices will fall and some investors will loose money selling cheaper than thy bought. Then AI unicorns will start to loose funding and closing their business laying off people.
But will I, a person who do not work in AI industry and did not invest in AI companies, be affected by this?
null_dot@lemmy.dbzer0.com 2 weeks ago
Yes, you absolutely will be effected.
In a general way, the plebs always do the heavy lifting - a universal truth since the dawn of time.
More specifically, your pension / 401k will lose a heap of money.
As the economy contracts there will be lay offs.
That means loan defaults, et cetera.
msage@programming.dev 2 weeks ago
Pensions in the stock market are the hostage, and are being used as an excuse against regulations.
Fuck all of that.
sobchak@programming.dev 2 weeks ago
I don’t know the answer, but during 2008 onwards (seems like the economy didn’t fully recover until the end of Obama’s presidency), every industry slowed down. Was hard for me to get a fast food job or consistent minimum wage assembly line work through temp agencies. Things can go into vicious negative feedback loops during downturns (investors afraid to invest due to bad economic outlook -> factories and such don’t get built or expanded -> unemployment rises -> people spend less -> companies start laying off -> economic outlook worsens -> investors selling and moving to "safer’ assets -> …). The entire banking system pretty much imploded during 2008; I don’t know how much exposure banks have to AI (commercial real estate is another thing to worry about though). With any luck the AI crash would be more like the dot-com crash, which mostly just hurt one industry (but I remember my father talking about factory layoffs during that too).
Lucelu2@lemmy.zip 2 weeks ago
My family lost a great deal of invested wealth in that 2008 crash with the death of Mellon Bank. It does not seem like a lot today but … if it had been invested in say Chase or G-S… it would have probably been double what it was by now. I am sure my dad was twisting in his coffin when that happened. I am glad he did not suffer that when it happened (he died in 2005).
Redex68@lemmy.world 2 weeks ago
One thing people didn’t mention is that I’m pretty sure the top 10% of Americans by income make up 50% of consumption because of the heavily K shaped revovery that has happened. These Americans have a large percentage of their wealth in stocks, and if the stock market crashes, they will feel less wealthy and less willing to spend, decreasing their spending, tanking the US economy.
Knock_Knock_Lemmy_In@lemmy.world 2 weeks ago
Boo hoo. Rich people become less rich.
1984@lemmy.today 2 weeks ago
Trump is a much bigger threat to tanking the US economy. He is working in that direction every day. Tariffs are horrible for the economy. Sure, he gets American factories built and jobs are created but things overall are going to be much more expensive for consumers.
Lucelu2@lemmy.zip 2 weeks ago
I think the top 10% are author of more than 50% of the spending/consumership. That is about to become larger.
teslasaur@lemmy.world 2 weeks ago
Your pension is tied to these companies stocks. I can pretty much guarantee that “your” pension fund owns quite a few of these stocks.
But, and this is the important part, that isn’t your pension. It is the pension for those that are retired right now. There is no saved stack of money that you earned during your life thats waiting for you. Unless there is an equal amount of tax paying workers by the time you retire, you wont be getting that pension.
mojofrododojo@lemmy.world 2 weeks ago
Hold up everyone. It’s not a bubble.
“So it is true that valuations are high but, in our view, generally not at levels that are as high as are typically seen at the height of a financial bubble,” said Goldman Sachs strategist Peter Oppenheimer.
He’s from GOLDMAN SACHS LOLOLOLO I THINK THEY WOULD RECOGNIZE A BUBBLE LOL ah fuck me our economy is gonna splode
Gork@sopuli.xyz 2 weeks ago
It’ll crash when there isn’t enough electric power to fulfill all those contractual obligations.
BilSabab@lemmy.world 2 weeks ago
But what will be left after it bursts? At least in cause of the housing bubble - the houses existed physically - what will be after the AI crash? Lots of spare gear sold for cheap?
Blackmist@feddit.uk 2 weeks ago
I’ll just wait for the movies to come out ten years later telling us exactly how they all lost our money again.
drmoose@lemmy.world 2 weeks ago
Unpopular opinion but this will not as bad as housing bubble and we’re way past bubbles actually popping in contemporary economy. Even China corrected for its massive ghost city housing bubble just recently and that was actually worse than ai tech overvaluation.
xylogx@lemmy.world 2 weeks ago
There is definitely a bubble. But also what Nvidia is doing is smart. They have boatloads of cash. They are investing that cash in the companies that are using their products to create money making services. If one of them can create a killer app or viable service this will create demand for their products and they will have an ownership stake in it. Is this guaranteed or even likely? Probably not. We have reached the point where we were in 1996 where the chairman of the fed came out and said we are in a period of “irrational exuberance.” That bubble took four more years to pop. This one may end quicker, but it is impossible to tell when it will end or what will come out of it from where we sit today.
pinball_wizard@lemmy.zip 2 weeks ago
They do look like bubbles.
biofaust@lemmy.world 2 weeks ago
From the entry for “zaibatsu” on Wikipedia:
Under the Allied occupation after the surrender of Japan, a partially successful attempt was made to dissolve the zaibatsu. Many of the economic advisors accompanying the SCAP administration had experience with the New Deal and were highly suspicious of monopolies and restrictive business practices, which they felt to be both inefficient, and to be a form of corporatocracy (and thus inherently anti-democratic).
The only difference? The zaibatsu actually diversified their operations.
Buffalox@lemmy.world 2 weeks ago
I don’t think it’s a bubble, first there is absolutely zero comparison to the housing bubble, which was a financial problem, and this alleged bubble is mostly driven by companies that have lots of money, so it is not credit based.
The better comparison would be the dot com bubble, which was dominated by companies that didn’t even have a product and didn’t make any money. The frenzy is similar, but the fundamentals are different.
AI investments may cool down because obviously there is a frantic race in an attempt to get ahead.
But the reason I don’t think the AI bubble will burst is because it is driven by companies that actually make money.
They may lose money investing too heavily in this, but they most companies investing in this can afford it.If it is a bubble, it is a very very long one, Nvidia value has been exploding since 2016 based on their AI products.
If this is a bubble, I think it will go down in history as the longest living bubble ever.Is the market frantic? Yes absolutely.
Is the value of some AI companies extremely high? Yes absolutely.
Is it a bubble that will burst? No if it’s a bubble, this one will be more like deflating to a less frantic level, because ALL the main players have the money to weather losses.JustJack23@slrpnk.net 2 weeks ago
Look at all those not market related bubbles
rising_man@lemmy.world 2 weeks ago
More like the 2000s bubble.
MourningDove@lemmy.zip 2 weeks ago
It needs to burst into non-existence.
rafoix@lemmy.zip 2 weeks ago
It seems like the wealthy propping up their own bubble.
humanspiral@lemmy.ca 2 weeks ago
This only got downvotes in another thread. There is far worse that can happen than an AI bubble.
People get distracted over the fate that the pure speculative frenzy could be an AI bubble, and the harm to the hapless speculators and banksters could have a minor impact on the rest of the economy.
Reality is far worse than an AI bubble. It is a US mission for a fossil fueled powered Skynet for Israel that is too big to fail. Bubble in AI investments becomes unlikely, but total destruction of rest of US economy/prosperity becomes assured when the “plebs able to eat in America bubble” bursts is a sacrifice that a fossil fueled powered Skynet for Israel is willing to make.
If Americans are still able to afford to eat, then China or Iran wins.
1984@lemmy.today 2 weeks ago
I dont think we are in a bubble and I think all the media posts about it are just trying to make people sell their shares.
Sure there is no obvious profit yet but there will be. Once people start using AI in their phones and ask it questions, everything from bakning to coding becomes way easier since its an interactive conversation, not a search result.
People will pay for that convenience since its a huge downside to not have access to it.
LustyArgonianMana@lemmy.world 2 weeks ago
Anyone notice how far crypto dropped? I think Tesla’s next, then maybe AI at same time or right after
ezterry@lemmy.zip 2 weeks ago
I see “gold rush” the company selling shovels is making out like a bandit, everyone else is make a profit on the previous gen but requires a 10x cost increase for the next gen. And thus 10x more shovels… As soon as 10x more shovels stops giving 10x+ improvements this is the wrong investment.
Hints are we already reached this point.
Some AI companies will pivot and improve in other ways with more linear costs/results… The ones hoping the line continues to the moon… I think they overshot… I just don’t know when it will fall back…
TheObviousSolution@lemmy.ca 2 weeks ago
Unpopular opinion, but every nascent industry looks like a bubble. What makes it a bubble is if and when it pops. It anything, LLM AI might deflate and stabilize, but it’s also here to stay. In that case, what pops NVIDIA is when they can’t expand any more and they go against geopolitical interests that begin stealing and making viable alternatives for the price.
FlashMobOfOne@lemmy.world 2 weeks ago
It’s objectively a bad thing when a country’s entire economy is being propped up by seven companies and the vast majority of consumer spending is concentrated in the top 1%.
TeamAssimilation@infosec.pub 2 weeks ago
Specially when those companies are valued in TRILLIONS. Nothing is worth trillions, somehow these surreal numbers have been accepted as hard fact.
ILoveUnions@lemmy.world 2 weeks ago
There is things worth trillions. Like full countries, and the largest pension funds and social security funds. Having a single company be comparable to those massive collections of people is insane, and it’s because they think it can replace workers–when it can’t, not yet, and not fo a long time
IllNess@infosec.pub 2 weeks ago
Evaluations of everything is crazy. Net worth of celebrities with make up lines in particular is crazy. Look how many celebs are worth a billion dollars. To be worth that much, they should be selling at least $50 millions a year of product with no prediction of winding down.
queermunist@lemmy.ml 2 weeks ago
The most optimistic take I’ve seen: AI is a drain on the entire economy that sucks up all investment and this is why the rest of the economy is basically in a recession. Once the bubble pops, investors will flood back into the real economy and correct the problem.
I’m not optimistic.
dragonfucker@lemmy.nz 2 weeks ago
Can the AI bubble please suck up all the housing investment?
jabberwock@lemmy.dbzer0.com 2 weeks ago
I’ll play devil’s advocate here: agreed that the rest of the (US) economy seems to be slowing or shrinking but remains buoyed by AI / Mag 7 stocks. That said, a lot of the investment reflected above is in data centers and hardware (Nvidia, Coreweave, Oracle, Microsoft).
The bubble pop will hinge on whether there is value in this data center buildup beyond AI. Unless everyone starts paying fistfulls of cash for AI chat, these companies may be able to find another use for all that compute and avoid a total crash. That could be a target for all that investment you mention.
gravitas_deficiency@sh.itjust.works 2 weeks ago
Hahaha this is fine, I am fine with this, what could possibly go wrong
Cethin@lemmy.zip 2 weeks ago
Basically, Dutch Disease.
Valmond@lemmy.world 2 weeks ago
I feel money itself is our new Dutch disease. We live and die according to the flux of money in the global economy/stock markets…
Are there any theories like that out there? Because money start to no longer function correctly IMO.
jerebear39@slrpnk.net 2 weeks ago
Yep it’s such a fragile situation