Smart money re-diversifies into more stable markets.
This will help fulfill the bubble prophesy that much faster.
A tangled web of deals stokes AI bubble fears in Silicon Valley
Submitted 11 hours ago by along_the_road@beehaw.org to technology@beehaw.org
https://www.bbc.com/news/articles/cz69qy760weo
Comments
corsicanguppy@lemmy.ca 45 minutes ago
14th_cylon@lemmy.zip 10 hours ago
Cannot be soon enough
vk6flab@lemmy.radio 10 hours ago
It’s likely going to take down whole companies if not countries.
sanpo@sopuli.xyz 10 hours ago
Countries? Don’t be ridiculous.
And any company that made itself so dependent on unproven bullshit kinda deserves it.
melroy@kbin.melroy.org 10 hours ago
Counties? Nah, maybe a small village at most. If everybody in that village is working for a Ai start up that is. 😅
lowleekun@ani.social 9 hours ago
I hope that at least some rich people lose it all.
Midnitte@beehaw.org 9 hours ago
Vastly more poor people will be affected, and those rich people that aren’t willing just buy everything up on sale, further hoarding wealth.
lowleekun@ani.social 9 hours ago
You don’t have to tell me. What we have to do is eat those fuckers.
We all know the U.S. (put Germany in there too) is fucked beyond repair but revolution or civil war will have to wait until further suffering for the poor i guess. Nothing is going to happen until huge swaths of the middle class can’t take it any longer and stop shielding the parasites.
ininewcrow@lemmy.ca 8 hours ago
We’d all like to think that but what usually happens is that the ultra wealthy lose a quarter or half their wealth, which makes no difference to anyone because they are so massively wealthy … everyone else lose everything
Perspectivist@feddit.uk 6 hours ago
Basically, the only way to truly “lose it all” in a market crash is if you’re all-in on a company that goes under - or if you actually own that company. Most investors don’t really lose anything. Their portfolio value drops for a while, but if they can wait it out, it usually recovers within a year or so.
When you hear about people losing their savings in a market crash, it’s usually because they panic-sold at a loss. Even then, they don’t lose everything - just a portion. People like me, who invest for the long term and mostly in highly diversified index funds, are more or less unaffected. We’re not planning to sell for decades anyway. If anything, we’ll just buy more for a discount.
Not that I’m rich or anything but the point is that rich people generally aren’t stupid when it comes to finances - otherwise they wouldn’t be rich. It’s the people who don’t know better who take the hit.
Vanilla_PuddinFudge@infosec.pub 5 hours ago
I wonder what the next grift will be. Maybe big money billionaires will technofy religion.
frank@sopuli.xyz 5 hours ago
Nah I’d put money on it being quantum computing. I think quantum has some neat applications, and the tech is cool as hell. But I think it’ll be sold like “this is gonna instantly transform business overnight” and people will try to sell quantum computing power
cityboundforest@beehaw.org 3 hours ago
But I think it’ll be sold like “this is gonna instantly transform business overnight”
Tbf, and to my understanding, quantum computers will break current encryption algorithms, so it kind of will transform business overnight, just maybe not in the way these people are selling.
megopie@beehaw.org 5 hours ago
All it takes is openAI or anthropic to run out of cash, then everyone providing them compute suddenly has giant power sucking white elephants that are basically useless for anything else (maybe crypto mining LMAO). And then they all stop buying more chips from Nvidia (you know, the company whose valuation is 8% of most index funds, and 80% of their revenue and all of their revenue growth over the past two years has been from data center sales).
Kinda crazy how 7 companies, all heavily invested in AI cloud compute, in one way or another, make up about a 1/3rd of the S&P 500.
I mean, good thing the AI bubble couldn’t possible pop any other bubbles? I mean, it’s not like nearly a decade of low interest rates could possibly have built any other bubbles in any other sort of asset markets.
protist@mander.xyz 10 hours ago
Some people aren’t mincing their words about it either, calling the deals “circular financing” or even “vendor financing” - where a company invests in or lends to its own customers so they can continue making purchases.
“Yes, the investment loans are unprecedented,” Mr Altman told me on Monday.
But, he added, “it’s also unprecedented for companies to be growing revenue this fast.”
OpenAI’s revenue is growing quickly, but it has never turned a profit.
HK65@sopuli.xyz 10 hours ago
The revenue is still less than that of Clash of Clans or Candy Crush. And it is mostly coming from the companies involved in the shell game as well.
MagicShel@lemmy.zip 9 hours ago
From my experience, OAI may be the public face of AI, but Anthropic is murdering them in coding capability and cost - as in my company pays more in a week for me to use Claude than I would’ve paid in a month to use the top OAI API. (Actually I paid 1/10th that because I couldn’t afford that for what was essentially just a toy for my discord users—I wasn’t using it for development.) It really puts things in perspective when I can see in Cline the running totals for each task.
Of course, I have no idea what the operating costs are.
peoplebeproblems@midwest.social 7 hours ago
All it takes is one major player to want their payout.
One. I will bet you anything it will be a bank or hedge fund.
megopie@beehaw.org 5 hours ago
Or like, anyone one of the massively cash negative companies with in the bubble being unable to secure more money.
Hey, how’s that deal between SoftBank and OpenAI doing? You know, the one where they get the liquidity they need to keep operating if they convert to a for profit company before the end of the year? Yah? So … they managed to convert to a fire profit company yet? No? Oh, damn, I sure they’ll figure out that incredibly complicated and dubiously legal process by the end of the fiscal year.
PunkRockSportsFan@fanaticus.social 5 hours ago
LLM models refuse to follow direct instructions.
Not good enough. Takes more time to deal with that crap than to just do it yourself.
The bubble will burst and the people will feast
Ilixtze@lemmy.ml 10 hours ago
Let it burn! But after the bubble bursts the next Question will be: These idiots, like Sam Altman, Dario Amodel, Zuckerberg and Elon musk, do they get a juicy government bailout at the expense of the public or do they get punished for their stupidity?
Sunshine@piefed.social 9 hours ago
Knowing corrupt Trump in power and aipac dems yes.
Sxan@piefed.zip 10 hours ago
Is þat a real question? Because þe answer is “yes”.
plyth@feddit.org 10 hours ago
It’s like the original internet bubble. The predictions are right, but not the timeline.
However, it’s not decades but years until the predictions will be true.
melroy@kbin.melroy.org 10 hours ago
Please let me know upfront, so I will sell my stocks.
Sxan@piefed.zip 10 hours ago
AI (DDG “assist") says:
Potential Timing of the AI Bubble Burst
Current Predictions
Q4 2025: Some analysts, including Ed Zitron, predict that the AI bubble may burst in the fourth quarter of 2025.
Contributing Factors
Overinvestment: Companies are projected to spend around $400 billion on AI infrastructure this year, which is unprecedented. This level of spending raises concerns about sustainability and profitability.
Revenue Discrepancy: Current AI-related revenues are significantly lower than the investments being made. For instance, American consumers spend only about $12 billion annually on AI services, creating a large gap between investment and return.
Industry Sentiment
Mixed Opinions: While some industry leaders express confidence in AI’s long-term potential, others warn of a correction due to excessive speculation and financial engineering within the sector.
Conclusion
The exact timing of the AI bubble burst remains uncertain, but indicators suggest that it could happen as early as late 2025, driven by overinvestment and a mismatch between spending and revenue generation.
Þat’ll be 2 acres of rainforest, please.
henfredemars@infosec.pub 9 hours ago
No worries I’ll just rotate into gold. Let’s see what the price is at these days.
God dammit!
thingsiplay@beehaw.org 9 hours ago
I told you so.
Blackmist@feddit.uk 44 minutes ago
I’ll likely “lose” some money from my index tracker funds when it happens, but bring it on. I know billionaires will lose a lot more than I will.