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This is a bubble and one that will burst very hard. AI is the perfect technology for this. It's opaque and most investors (who barely understand tech in general

This is a bubble and one that will burst very hard. AI is the perfect technology for this. It's opaque and most investors (who barely understand tech in general) have no clue what it really does or how it works. This is the closest we've ever had to multiple large respected tech companies selling "snake oil" a cure all. The capabilities of AI they mention as if they're available today are literally many decades and generations away. Automating information workers, creatives and engineers will take AGI that's simply impossible with our technology. When the AI bubble bursts I wouldn't be surprised if takes down major tech companies with it.

jstummbillig 3y ago
Can you be specific about what the bubble is? I am getting 100x value out of my 30 chatgpt bucks. I am doing things that I could not have done pre-gpt4, being more productive by a factor of, idk, 1.25 maybe. It's quite simply the largest/simplest productivity improvement in my life, so far. Given it's only going to get better, unless they are underpricing the service by a enormous margin (as in: defrauding shareholders margin) I have a hard time understanding what shape the bubble could possibly have.
- Judgmentality 3y ago
  Do any AI companies actually turn a profit? I feel like the only real winner is Nvidia because they are selling shovels to the gold diggers, while all the gold diggers are trying to outspend each other without a business model that has any consideration for unit economics.
  - jstummbillig 3y ago
    I love a prudent take on company money – but given how investing works and how young this entire thing is and the (to me) absolutely real value, I find it hard to be very worried about that part right now. I can literally run a ballpark model on my MB Pro, right now, at marginal additional electrical cost. I will be the first to say that all of this (including GPT4) is still fairly garbage, but I don't know when there was the last time in the history of tech, where less fantasy to get from here to what will be good was required.
  - chucke1992 3y ago
    The thing is that the bigger business giants like MSFT or Amazon are probably profit quite nicely from AI. Smaller companies, not aligned with any big giants - probably not.
    - deleted 3y ago
      [deleted]
- PheonixPharts 3y ago
  You're really generating $3000 per month from ChatGPT? Can you give a hint about what you've built that generates this kind of ROI? I have only seen people making money in AI by selling AI products/promises to other people who are losing money. The practical uses of these tools still seem to be largely untapped outside of as enhanced search engines. They're great at that, but that does not have a return on value that is in proportion to current investment in this space.
  - jstummbillig 3y ago
    > Can you give a hint about what you've built that generates this kind of ROI? Sure. Absolutely nothing amazing: (Mostly) internal software for a medical business I am currently building. It's just that the actual cost of hiring someone is even quite a bit higher, than what is printed on the paycheck and the risk attached to anyone leaving on a small team is huge (n=0 and n=1 is an insane difference). GPT4 has bridged the gap between being able to do something and not being able to do something at various points over the past year. EDIT: And to be clear, while I won't claim "rockstar programmer", I have coded for roughly 20 years, which is the larger part of my life.
    - JumpCrisscross 3y ago
      Just spoke to a restaurant group owner in Mexico who was able to eliminate their web developer because he can now ask ChatGPT to draft up a basic website. The kicker? It couldn't do the interactive menu their old website did, so now clicking menu links to a PDF. Which is always, ALWAYS, better.
      - sgu999 3y ago
        > he can now ask ChatGPT to draft up a basic website. I'm pretty sure he could have done that with one of the thousands tools like Wix, many years before ChatGPT.
        slices 3y ago
        yes, but which one of thouse thousand, how long would it take to learn how to use it, etc. Still less friction in just asking ChatGPT to do this via the same interface you ask it to do a bunch of other stuff.
- spiderice 3y ago
  I’m really curious what is making you so much more productive. My experience with AI has largely been the opposite. Also curious how you’re using AI to make $3,000 per month more than you would without it.
  - choilive 3y ago
    It's not that he is making $3k a month, he gaining the equivalent productive value of of $3k.
    - oblio 3y ago
      How is he measuring that, though?
      - choilive 3y ago
        Average time saved per task * Number of tasks * Cost of their time per hour. At $100/hr (not unreasonable for Sr. SWE) - he just needs to save 30 hrs/mo. Not to mention the opportunity cost of using that time on more impactful activities on their startup. AI can be a force multiplier for sure.
        spiderice 3y ago
        Then he is either making an extra $3,000/month or working 30 hours less per month. If the former isn’t true, I am extremely doubtful that the latter is. Seems more likely that he is over estimating the value that LLMs are bringing him. Or he is an extreme outlier, which is why I was asking for further details
  - aquova 3y ago
    I feel the same way. I think LLMs are neat, and I find them interesting from a technical standpoint, but I have yet to have them do anything for me that's more than just a novelty. Even things like Copilot, which I'll admit has impressed me a bit, doesn't feel like it would radically change my life, even if it was completely foolproof.
- rchaud 3y ago
  The bubble is that every $1 in capital going to OpenAI/Nvidia is a $1 that cannot be invested anywhere else: Healthcare, Automotive, Education, etc. Of course OAI and Nvidia will invest those funds, but in areas beneficial purely to them. Meta has lost $20bn trying to make Horizon Worlds a success, and appears to have abandoned it. Even government-led industrialization efforts in socialist economies led to actual products, like the production of the Yagan automobile in Chile in the 1970s[0]. We've already had a decade plus of sovereign wealth funds sinking tens of billions into Uber and autonomous driving. We still don't have those types of cars on the road and it's questionable whether self driving will even generate the economic growth multiplier that its investment levels should merit. [0] https://journal.hkw.de/en/erinnerungen-an-den-yagan-allendes-auto-fuer-das-volk/ https://journal.hkw.de/en/erinnerungen-an-den-yagan-allendes...
  - DANmode 3y ago
    As well as the artificially increased valuations for every company with the .ai TLD for their landing page.
  - jstummbillig 3y ago
    Fair enough. I personally would have a hard time spotting an outsized lost opportunity value with confidence, if it existed. It feels, though, that this argument could (maybe a be little too easily) be applied to any new industry sector, in horse-vs-car fashion.
  - polski-g 3y ago
    When Meta "lost" 20bn, they actually spent it on salary. The employees then go out and buy things like the Tesla Automobile, an actual product.
    - acdha 3y ago
      This sounds like the broken window fallacy. You could use the same logic to suggest that Meta dump piles of cash on the sidewalk in front of their office - it’d circulate but it wouldn’t help them.
    - 3y ago
- wing-_-nuts 3y ago
  I get that there are limitations with LLMs, but I don't understand people saying it has no value, just because it occasionally hallucinates. Over the past week I've used chatGpt to code not one, but two things that were completely beyond my knowledge (an auto delete js snippet, and a gnome extension that turns my dock red if my vpn turns off). These are just two examples. I've also used it to write a handy regex and write a better bash script. LLMs are insanely helpful if you use them with their limitations in mind.
  - aleph_minus_one 3y ago
    > LLMs are insanely helpful if you use them with their limitations in mind. This depends on your use case. I can honestly tell that all the chat bot AIs don't "get" my kind of thinking about mathematics and programming. Since some friend who is graduate student in computer science did not believe in my judgement, I verbally presented him some test prompts for programming task where I wanted the AI to help me (these are not the most representative ones for my kind of thinking, but are prompts for which it is rather easy to decide whether the AI is helpful or not). He had to agree from the description alone that the AIs will have difficulties with these task, despite the fact that these are common, and very well-defined programming problems. He opined that these tasks are simply too complex for the existing AIs, and suggested that if I split these tasks into much smaller subtasks, the AI might be helpful. Let me put it this way: I personally doubt that if I stated the subtasks in a way in which I would organize the respective programs, the AI would be of help. :-) What was just important for me was to able to convince the my counterpart that whether AIs are helpful or not for programming depends a lot on your kind of thinking about programming and your programming style. :-)
    - wing-_-nuts 3y ago
      I would say that the ability to break a problem down into manageable chunks is the mark of a sr dev. I think of chatGpt as a jr that's read a lot but understands only a little. To crib Kurtzwell you gotta 'run with the machine'
      - 3y ago
- nozzlegear 3y ago
  Last night I asked ChatGPT 4 to help me write a quick bash script to find and replace a set of 20 strings across some liquid files with a set of 20 other strings. The strings were hardcoded, it knew exactly what they were in no unclear terms. I just wanted it to whip up a script that would use ripgrep and sed to find and replace. First, it gave me a bash script that looked pretty much exactly like what I wanted at first glance. I looked if over, verified it even used sed correctly for macOS like I told it, and then tried to run it. No dice: replace.sh: line 5: designer_option_calendar.start_month.label: syntax error: invalid arithmetic operator (error token is ".start_month.label") Not wanting to fix the 20 lines myself, I fed the error back to ChatGPT. It spun me some bullshit about the problem being the “declaration of [my] associative array, likely because bash tries to parse elements within the array that aren’t properly quoted or when it misinterprets special characters.” It then spat out a “fixed” version of the script that was exactly the same, it just changed the name of the variable. Of course, that didn’t work so I switched tactics and asked it to write a python script to do what I wanted. The python script was more successful, but the first time it left off half of the strings I wanted it to replace, so I had to ask it to do it again and this time “please make sure you include all of the strings that we originally discussed.” Another short AI example, this time featuring Mistral’s open source model on Ollama. I’d been interested in a script that uses AI to interpret natural language and turn it into timespans. Asking Mistral “if it’s currently 20:35, how much time remains until 08:00 tomorrow morning” had the model return its typical slew of nonsense and the answer of “13.xx hours”. This is obviously incorrect, though funnily enough when I plugged its answer into ChatGPT and asked it how it thought Mistral may have come to that answer, it understood that Mistral did not understand midnight on a 24 hour clock. These are just some of my recent issues with AI in the past week. I don’t trust it for programming tasks especially — it gets F# (my main language) consistently wrong. Don’t mistake me though, I do find it genuinely useful for plenty of tasks, but I don’t think the parent commenter is wrong calling it snake oil either. Big tech sells it as a miracle cure to everything, the magic robot that can solve all problems if you can just tell it what the problem is. In my experience, it has big pitfalls.
  - foobiekr 3y ago
    I've had the same experience, but I usually get what I want. Admittedly, I'm using it to script around ffmpeg which is a huge pain in the ass. That said, every single script it churns out is unsafe for files with spaces on the first go round. Like.. Ok. It's like having a junior programmer with no common sense available.
- outside1234 3y ago
  There is very clear value in LLMs The bubble is that it is not clear there is a $XXXB business in building or hosting them. OpenAI is losing money hand over fist, open source models are becoming available that are on-par and so commoditize the market, etc.
- novaRom 3y ago
  > largest/simplest productivity improvement in my life, so far many productivity improvements in the last years: Internet Search, Internet Forums, Wikipedia, etc. LLMs and other AI models is continuation of the improvement of information processing.
- philoinvestor 3y ago
  Can I paste links in replies here? I wrote an article about the AI bubble a few weeks ago.
  - nozzlegear 3y ago
    Yes you can.
    - philoinvestor 3y ago
      This piece went viral a few weeks ago: https://www.philoinvestor.com/p/downside-at-nvidia-and-the-nasdaq https://www.philoinvestor.com/p/downside-at-nvidia-and-the-n...
- philoinvestor 3y ago
  You may be getting 100x value out of your 30 bucks. Is that the only variable that one needs to consider to gauge if this is bubble territory?
  - jstummbillig 3y ago
    Other variables is basically what I was asking for, in the first sentence of my comment.
    - philoinvestor 3y ago
      How many GPUs are being delivered today and for how long will they be used / what's their life? Who is funding the purchase of those GPUs? If VC money then what happens if the startups don't make money? Are users using AI-apps because they are free and dump them soon? Isn't their competition in semiconductors? Won't we have chips-as-a-commodity soon? LLMs-as-a-commodity? Is Big Tech spending all this money to create VALUE or just to survive the next phase of the technological revolution? (e.g. the AI rush) If prices are high, and sales are high, and competition is still low -- then how much is nvidia actually worth? And if we don't now why is it selling for so many times earnings? https://www.philoinvestor.com/p/downside-at-nvidia-and-the-nasdaq https://www.philoinvestor.com/p/downside-at-nvidia-and-the-n...
      - jstummbillig 3y ago
        These are all potentially interesting questions, but do any of them offer a concise answers to the bubble-question or are we just speculating?
- dottjt 3y ago
  It's that "it's only going to get better" part that is driving the bubble, I think. The market has this idea that over the next year, we're somehow going to have AI that's literally perfect. Yet that's not how technology works, it takes decades to get there. It'd be like if the first LCD TV was invented, and all of a sudden everyone is expecting 8k OLED by the next year. It just doesn't work like that.
  - thatoneguy 3y ago
    Yeah, but this is different because it's largely just money -> more GPUs -> more people looking at the problem -> better results. You can't stumble upon an 8K TV overnight but you can luck upon the right gold mining claim and you can luck upon some new training algorithm that changes the game immediately.
    - oblio 3y ago
      This assumes answers which go from 8/10 to 9/10 increase the cost linearly. The scale could be exponential or worse.
  - jstummbillig 3y ago
    Fair – but again: If it just stayed frozen in the state it is now (and that assumption is about as unreasonable, as it being "perfect" in a year), it's already going to be tremendously useful for increasingly many people (when cost will go down, and they will, accessibility will go up) — at least until something better comes around. For those who extract value right now, the simple alternative (just not using it) is never going to be the better choice again. It's transformative.
- jononor 3y ago
  ChatGPT plus is approx 300 USD yearly. You are earning 30k (100x) USD more yearly due to ChatGPT? Or earning 100k with 30% use or your time?
philoinvestor 3y ago
I agree that it's opaque and that's why I said that AI can be the ULTIMATE bubble.
- mnky9800n 3y ago
  It's a shame the phrase "black box" exists in machine learning when it could have been "black bubble".
Spivak 3y ago
> This is the closest we've ever had to multiple large respected tech companies selling "snake oil" a cure all. The problem with this take is you can deliver real results. At current $dayjob we do the very dumbest thing which is text -> labels -> feedback -> fine_tune -> text... and surface them as part of our search offering and it's rocketed to the most useful customer feature in less than 6 months of rolling it out. Customers define labels that are meaningful to them, we have a general-purpose AI classify text according to those labels. Our users gleefully (which is shocking given our industry) label text for us (which we just feed into fine_tuning) because of just how fast they can see the results. Like it's as grug brain as it gets and we bumbled into a feature that's apparently more valuable to our users than the rest of the product combined. Folks want us to sell it as a separate module and we're just hoping they don't realize it's 3 LLMs in a trenchcoat.
ABS 3y ago
P/E ratios (so far) say otherwise: all the big tech public companies have reasonable P/E ratios and are investing heavily their profits in contrast to, say, the dotcom bubble when over 40% of the companies had P/E ratios unsustainably over the moon. Are there a gazillion companies riding the "AI everywhere" wave to raise money? yes, yes there are. Will most of them fail? sure. But the big players are fine at the moment so there is nothing that can burst very hard (yet) and the difference is in the denominators which are, so far, going up. Of the top ones only NVIDIA and Amazon have P/E ratios a bit too high and among the top 10 only AMD's is way too high.
partiallypro 3y ago
I think there is a bubble, but not in the traditional sense of this all being nonsense. Obviously, AI is going to be a world changer, but I think in a few years many companies are going find, at least for them, that their projects using AI are wildly unprofitable. Good AI is expensive. This could take years to play out, but when Nvidia is trading higher than Microsoft and Apple in total market cap, we'll be well into it. I don't rule that out.
SunlitCat 3y ago
It's like the previous craze with blockchain. Everyone and their dog was about to use blockchain to do the most awesome thing ever. And even things that didn't really lend themselves to blockchain were suddenly presented as prime examples of how to use blockchain. I'm not saying both technologies don't have their uses, but the hype around them is crazy and not healthy.
- philoinvestor 3y ago
  Yep, there are similarities between the blockchain rush and the AI rush. But in my last piece on AI, I said that AI is 50X Blockchain!
  - SunlitCat 3y ago
    That answer inspired me to ask ChatGPT on how blockchain could enhance AI. And, to say the least, I wasn't disappointed! It printed out a pretty long answer with several good points on how it could help to enhance AI. There we have it! Blockchain is about to solve all problems we have today with AI! :D
    - philoinvestor 3y ago
      "Blockchain solves this..."
- hackerlight 3y ago
  AI has massively increased my productivity. There are real users like me who will continue to pay up. This is not the same.
  - SunlitCat 3y ago
    Like with blockchain, there are real uses, of course i totally agree! But I was more thinking about the craze surrounding the whole thing, like with blockchain, you can see everyone trying to sell you AI for kinda everything.
  - 3y ago
codexon 3y ago
This technology is already fully automating copywriters and almost replacing concept artists right now. However it is true that right now the valuations are for something far more than that, and so far it doesn't seem like LLMs will be able to do much more. I was talking to someone that just retired from a programming position at a FANG and he seems to think that AGI (artificial general intelligence) is only a few years away just based off what he sees with ChatGPT and he's dumping all his money into AI stocks. The level of hype and over-extrapolation is so absurd, and the fact that it can affect someone with a technical background... It really does seem like a bubble to me.
- ForgotIdAgain 3y ago
  Isn't the role of a concept artist mainly to do worldbuilding and drawing second? AI does not seem to have a good world model, they make pretty pictures but they lack thought behind them.
  - codexon 3y ago
    I really don't know the details. You can see a concept artist here discovering he stopped getting work after a company splurted out that they switched to AI. https://twitter.com/_Dofresh_/status/1709519000844083290 https://twitter.com/_Dofresh_/status/1709519000844083290 My guess is that a lot of people can have ideas, so you don't need an artist to bring them to life anymore.
  - aquova 3y ago
    Agreed, and I think there are a number of... over-enthusiastic executives with dollar signs in their eyes who are in for a rude awakening about this. It might sound great to replace your artistic staff with an LLM subscription, until you realize that you laid off all the creative vision with them. That isn't to say I think it'll go away though, I wouldn't be surprised if art students in the future are taught how to wrangle LLMs to supplement their own designs.
curtisblaine 3y ago
> When the AI bubble bursts I wouldn't be surprised if takes down major tech companies with it. Hopefully, knock wood. Maybe it will even slow down the genrral enshittification created by those major tech companies.
d--b 3y ago
Well that's your view, but we keep seeing incredible progress year on year. Noone thought beating the game of Go was feasible. Noone thought self-driving cars would actually work. Noone predicted ChatGPT. See where we're at now with multi modal models. And Sora. The truth is that you can't predict anything anymore about this tech cause all expectations keep being blown away. AGI may be right there, and that's what's driving the money.
- ArchOversight 3y ago
  > Noone thought self-driving cars would actually work. Many people thought self driving WOULD work and that we'd be further along than we are now. We have vastly overestimated how far we'd be, and vastly underestimated how much time and effort it would actually take. Self driving cars as they exist today are still mere toys compared to where the industry thought they were going to be. Look at Cruise, Waymo, Zoox, Uber's ex-self driving car division and others. We are not anywhere near the self-driving autonomous cars we had hoped for.
  - deleted 3y ago
    [deleted]
- SirMaster 3y ago
  This doesn’t make any sense. If nobody thought the things were possible then why did they bother trying to do them? And even spend as much time and resources as they did trying to do them?
- oblio 3y ago
  > Noone thought beating the game of Go was feasible. Oh, yes, we did, once we beat chess. It was just a matter of time. > Noone thought self-driving cars would actually work. And... they don't? Call me when I can buy a regular car where I can sleep while traveling 8 hours, driven by the car itself. We're probably "flying cars" away from that.
huytersd 3y ago
Eh I don’t know. I find ChatGPT very useful atleast 10 times a day.
dorkwood 3y ago
This opinion is so crazy to me. How can it be a bubble if it's already providing me with 10x productivity gains? Things I've used GPT-4 to automate: replaying to all emails, writing entire books, doing all the legal paperwork for my new business, completing daily code challenges, generating shopping lists, writing birthday messages, and replying to my family group chat. And that's when the tech is still relatively new! Once the technology advances and I'm able to automate basically all of my daily tasks, who knows where I'll be.

jstummbillig 3y ago

Can you be specific about what the bubble is? I am getting 100x value out of my 30 chatgpt bucks. I am doing things that I could not have done pre-gpt4, being more productive by a factor of, idk, 1.25 maybe. It's quite simply the largest/simplest productivity improvement in my life, so far. Given it's only going to get better, unless they are underpricing the service by a enormous margin (as in: defrauding shareholders margin) I have a hard time understanding what shape the bubble could possibly have.

Judgmentality 3y ago
Do any AI companies actually turn a profit? I feel like the only real winner is Nvidia because they are selling shovels to the gold diggers, while all the gold diggers are trying to outspend each other without a business model that has any consideration for unit economics.
- jstummbillig 3y ago
  I love a prudent take on company money – but given how investing works and how young this entire thing is and the (to me) absolutely real value, I find it hard to be very worried about that part right now. I can literally run a ballpark model on my MB Pro, right now, at marginal additional electrical cost. I will be the first to say that all of this (including GPT4) is still fairly garbage, but I don't know when there was the last time in the history of tech, where less fantasy to get from here to what will be good was required.
- chucke1992 3y ago
  The thing is that the bigger business giants like MSFT or Amazon are probably profit quite nicely from AI. Smaller companies, not aligned with any big giants - probably not.
  - deleted 3y ago
    [deleted]
PheonixPharts 3y ago
You're really generating $3000 per month from ChatGPT? Can you give a hint about what you've built that generates this kind of ROI? I have only seen people making money in AI by selling AI products/promises to other people who are losing money. The practical uses of these tools still seem to be largely untapped outside of as enhanced search engines. They're great at that, but that does not have a return on value that is in proportion to current investment in this space.
- jstummbillig 3y ago
  > Can you give a hint about what you've built that generates this kind of ROI? Sure. Absolutely nothing amazing: (Mostly) internal software for a medical business I am currently building. It's just that the actual cost of hiring someone is even quite a bit higher, than what is printed on the paycheck and the risk attached to anyone leaving on a small team is huge (n=0 and n=1 is an insane difference). GPT4 has bridged the gap between being able to do something and not being able to do something at various points over the past year. EDIT: And to be clear, while I won't claim "rockstar programmer", I have coded for roughly 20 years, which is the larger part of my life.
  - JumpCrisscross 3y ago
    Just spoke to a restaurant group owner in Mexico who was able to eliminate their web developer because he can now ask ChatGPT to draft up a basic website. The kicker? It couldn't do the interactive menu their old website did, so now clicking menu links to a PDF. Which is always, ALWAYS, better.
    - sgu999 3y ago
      > he can now ask ChatGPT to draft up a basic website. I'm pretty sure he could have done that with one of the thousands tools like Wix, many years before ChatGPT.
      - slices 3y ago
        yes, but which one of thouse thousand, how long would it take to learn how to use it, etc. Still less friction in just asking ChatGPT to do this via the same interface you ask it to do a bunch of other stuff.
spiderice 3y ago
I’m really curious what is making you so much more productive. My experience with AI has largely been the opposite. Also curious how you’re using AI to make $3,000 per month more than you would without it.
- choilive 3y ago
  It's not that he is making $3k a month, he gaining the equivalent productive value of of $3k.
  - oblio 3y ago
    How is he measuring that, though?
    - choilive 3y ago
      Average time saved per task * Number of tasks * Cost of their time per hour. At $100/hr (not unreasonable for Sr. SWE) - he just needs to save 30 hrs/mo. Not to mention the opportunity cost of using that time on more impactful activities on their startup. AI can be a force multiplier for sure.
      - spiderice 3y ago
        Then he is either making an extra $3,000/month or working 30 hours less per month. If the former isn’t true, I am extremely doubtful that the latter is. Seems more likely that he is over estimating the value that LLMs are bringing him. Or he is an extreme outlier, which is why I was asking for further details
- aquova 3y ago
  I feel the same way. I think LLMs are neat, and I find them interesting from a technical standpoint, but I have yet to have them do anything for me that's more than just a novelty. Even things like Copilot, which I'll admit has impressed me a bit, doesn't feel like it would radically change my life, even if it was completely foolproof.
rchaud 3y ago
The bubble is that every $1 in capital going to OpenAI/Nvidia is a $1 that cannot be invested anywhere else: Healthcare, Automotive, Education, etc. Of course OAI and Nvidia will invest those funds, but in areas beneficial purely to them. Meta has lost $20bn trying to make Horizon Worlds a success, and appears to have abandoned it. Even government-led industrialization efforts in socialist economies led to actual products, like the production of the Yagan automobile in Chile in the 1970s[0]. We've already had a decade plus of sovereign wealth funds sinking tens of billions into Uber and autonomous driving. We still don't have those types of cars on the road and it's questionable whether self driving will even generate the economic growth multiplier that its investment levels should merit. [0] https://journal.hkw.de/en/erinnerungen-an-den-yagan-allendes-auto-fuer-das-volk/ https://journal.hkw.de/en/erinnerungen-an-den-yagan-allendes...
- DANmode 3y ago
  As well as the artificially increased valuations for every company with the .ai TLD for their landing page.
- jstummbillig 3y ago
  Fair enough. I personally would have a hard time spotting an outsized lost opportunity value with confidence, if it existed. It feels, though, that this argument could (maybe a be little too easily) be applied to any new industry sector, in horse-vs-car fashion.
- polski-g 3y ago
  When Meta "lost" 20bn, they actually spent it on salary. The employees then go out and buy things like the Tesla Automobile, an actual product.
  - acdha 3y ago
    This sounds like the broken window fallacy. You could use the same logic to suggest that Meta dump piles of cash on the sidewalk in front of their office - it’d circulate but it wouldn’t help them.
  - 3y ago
wing-_-nuts 3y ago
I get that there are limitations with LLMs, but I don't understand people saying it has no value, just because it occasionally hallucinates. Over the past week I've used chatGpt to code not one, but two things that were completely beyond my knowledge (an auto delete js snippet, and a gnome extension that turns my dock red if my vpn turns off). These are just two examples. I've also used it to write a handy regex and write a better bash script. LLMs are insanely helpful if you use them with their limitations in mind.
- aleph_minus_one 3y ago
  > LLMs are insanely helpful if you use them with their limitations in mind. This depends on your use case. I can honestly tell that all the chat bot AIs don't "get" my kind of thinking about mathematics and programming. Since some friend who is graduate student in computer science did not believe in my judgement, I verbally presented him some test prompts for programming task where I wanted the AI to help me (these are not the most representative ones for my kind of thinking, but are prompts for which it is rather easy to decide whether the AI is helpful or not). He had to agree from the description alone that the AIs will have difficulties with these task, despite the fact that these are common, and very well-defined programming problems. He opined that these tasks are simply too complex for the existing AIs, and suggested that if I split these tasks into much smaller subtasks, the AI might be helpful. Let me put it this way: I personally doubt that if I stated the subtasks in a way in which I would organize the respective programs, the AI would be of help. :-) What was just important for me was to able to convince the my counterpart that whether AIs are helpful or not for programming depends a lot on your kind of thinking about programming and your programming style. :-)
  - wing-_-nuts 3y ago
    I would say that the ability to break a problem down into manageable chunks is the mark of a sr dev. I think of chatGpt as a jr that's read a lot but understands only a little. To crib Kurtzwell you gotta 'run with the machine'
    - 3y ago
nozzlegear 3y ago
Last night I asked ChatGPT 4 to help me write a quick bash script to find and replace a set of 20 strings across some liquid files with a set of 20 other strings. The strings were hardcoded, it knew exactly what they were in no unclear terms. I just wanted it to whip up a script that would use ripgrep and sed to find and replace. First, it gave me a bash script that looked pretty much exactly like what I wanted at first glance. I looked if over, verified it even used sed correctly for macOS like I told it, and then tried to run it. No dice: replace.sh: line 5: designer_option_calendar.start_month.label: syntax error: invalid arithmetic operator (error token is ".start_month.label") Not wanting to fix the 20 lines myself, I fed the error back to ChatGPT. It spun me some bullshit about the problem being the “declaration of [my] associative array, likely because bash tries to parse elements within the array that aren’t properly quoted or when it misinterprets special characters.” It then spat out a “fixed” version of the script that was exactly the same, it just changed the name of the variable. Of course, that didn’t work so I switched tactics and asked it to write a python script to do what I wanted. The python script was more successful, but the first time it left off half of the strings I wanted it to replace, so I had to ask it to do it again and this time “please make sure you include all of the strings that we originally discussed.” Another short AI example, this time featuring Mistral’s open source model on Ollama. I’d been interested in a script that uses AI to interpret natural language and turn it into timespans. Asking Mistral “if it’s currently 20:35, how much time remains until 08:00 tomorrow morning” had the model return its typical slew of nonsense and the answer of “13.xx hours”. This is obviously incorrect, though funnily enough when I plugged its answer into ChatGPT and asked it how it thought Mistral may have come to that answer, it understood that Mistral did not understand midnight on a 24 hour clock. These are just some of my recent issues with AI in the past week. I don’t trust it for programming tasks especially — it gets F# (my main language) consistently wrong. Don’t mistake me though, I do find it genuinely useful for plenty of tasks, but I don’t think the parent commenter is wrong calling it snake oil either. Big tech sells it as a miracle cure to everything, the magic robot that can solve all problems if you can just tell it what the problem is. In my experience, it has big pitfalls.
- foobiekr 3y ago
  I've had the same experience, but I usually get what I want. Admittedly, I'm using it to script around ffmpeg which is a huge pain in the ass. That said, every single script it churns out is unsafe for files with spaces on the first go round. Like.. Ok. It's like having a junior programmer with no common sense available.
outside1234 3y ago
There is very clear value in LLMs The bubble is that it is not clear there is a $XXXB business in building or hosting them. OpenAI is losing money hand over fist, open source models are becoming available that are on-par and so commoditize the market, etc.
novaRom 3y ago
> largest/simplest productivity improvement in my life, so far many productivity improvements in the last years: Internet Search, Internet Forums, Wikipedia, etc. LLMs and other AI models is continuation of the improvement of information processing.
philoinvestor 3y ago
Can I paste links in replies here? I wrote an article about the AI bubble a few weeks ago.
- nozzlegear 3y ago
  Yes you can.
  - philoinvestor 3y ago
    This piece went viral a few weeks ago: https://www.philoinvestor.com/p/downside-at-nvidia-and-the-nasdaq https://www.philoinvestor.com/p/downside-at-nvidia-and-the-n...
philoinvestor 3y ago
You may be getting 100x value out of your 30 bucks. Is that the only variable that one needs to consider to gauge if this is bubble territory?
- jstummbillig 3y ago
  Other variables is basically what I was asking for, in the first sentence of my comment.
  - philoinvestor 3y ago
    How many GPUs are being delivered today and for how long will they be used / what's their life? Who is funding the purchase of those GPUs? If VC money then what happens if the startups don't make money? Are users using AI-apps because they are free and dump them soon? Isn't their competition in semiconductors? Won't we have chips-as-a-commodity soon? LLMs-as-a-commodity? Is Big Tech spending all this money to create VALUE or just to survive the next phase of the technological revolution? (e.g. the AI rush) If prices are high, and sales are high, and competition is still low -- then how much is nvidia actually worth? And if we don't now why is it selling for so many times earnings? https://www.philoinvestor.com/p/downside-at-nvidia-and-the-nasdaq https://www.philoinvestor.com/p/downside-at-nvidia-and-the-n...
    - jstummbillig 3y ago
      These are all potentially interesting questions, but do any of them offer a concise answers to the bubble-question or are we just speculating?
dottjt 3y ago
It's that "it's only going to get better" part that is driving the bubble, I think. The market has this idea that over the next year, we're somehow going to have AI that's literally perfect. Yet that's not how technology works, it takes decades to get there. It'd be like if the first LCD TV was invented, and all of a sudden everyone is expecting 8k OLED by the next year. It just doesn't work like that.
- thatoneguy 3y ago
  Yeah, but this is different because it's largely just money -> more GPUs -> more people looking at the problem -> better results. You can't stumble upon an 8K TV overnight but you can luck upon the right gold mining claim and you can luck upon some new training algorithm that changes the game immediately.
  - oblio 3y ago
    This assumes answers which go from 8/10 to 9/10 increase the cost linearly. The scale could be exponential or worse.
- jstummbillig 3y ago
  Fair – but again: If it just stayed frozen in the state it is now (and that assumption is about as unreasonable, as it being "perfect" in a year), it's already going to be tremendously useful for increasingly many people (when cost will go down, and they will, accessibility will go up) — at least until something better comes around. For those who extract value right now, the simple alternative (just not using it) is never going to be the better choice again. It's transformative.
jononor 3y ago
ChatGPT plus is approx 300 USD yearly. You are earning 30k (100x) USD more yearly due to ChatGPT? Or earning 100k with 30% use or your time?

philoinvestor 3y ago

I agree that it's opaque and that's why I said that AI can be the ULTIMATE bubble.

mnky9800n 3y ago
It's a shame the phrase "black box" exists in machine learning when it could have been "black bubble".

Spivak 3y ago

> This is the closest we've ever had to multiple large respected tech companies selling "snake oil" a cure all. The problem with this take is you can deliver real results. At current $dayjob we do the very dumbest thing which is text -> labels -> feedback -> fine_tune -> text... and surface them as part of our search offering and it's rocketed to the most useful customer feature in less than 6 months of rolling it out. Customers define labels that are meaningful to them, we have a general-purpose AI classify text according to those labels. Our users gleefully (which is shocking given our industry) label text for us (which we just feed into fine_tuning) because of just how fast they can see the results. Like it's as grug brain as it gets and we bumbled into a feature that's apparently more valuable to our users than the rest of the product combined. Folks want us to sell it as a separate module and we're just hoping they don't realize it's 3 LLMs in a trenchcoat.

ABS 3y ago

P/E ratios (so far) say otherwise: all the big tech public companies have reasonable P/E ratios and are investing heavily their profits in contrast to, say, the dotcom bubble when over 40% of the companies had P/E ratios unsustainably over the moon. Are there a gazillion companies riding the "AI everywhere" wave to raise money? yes, yes there are. Will most of them fail? sure. But the big players are fine at the moment so there is nothing that can burst very hard (yet) and the difference is in the denominators which are, so far, going up. Of the top ones only NVIDIA and Amazon have P/E ratios a bit too high and among the top 10 only AMD's is way too high.

partiallypro 3y ago

I think there is a bubble, but not in the traditional sense of this all being nonsense. Obviously, AI is going to be a world changer, but I think in a few years many companies are going find, at least for them, that their projects using AI are wildly unprofitable. Good AI is expensive. This could take years to play out, but when Nvidia is trading higher than Microsoft and Apple in total market cap, we'll be well into it. I don't rule that out.

SunlitCat 3y ago

It's like the previous craze with blockchain. Everyone and their dog was about to use blockchain to do the most awesome thing ever. And even things that didn't really lend themselves to blockchain were suddenly presented as prime examples of how to use blockchain. I'm not saying both technologies don't have their uses, but the hype around them is crazy and not healthy.

philoinvestor 3y ago
Yep, there are similarities between the blockchain rush and the AI rush. But in my last piece on AI, I said that AI is 50X Blockchain!
- SunlitCat 3y ago
  That answer inspired me to ask ChatGPT on how blockchain could enhance AI. And, to say the least, I wasn't disappointed! It printed out a pretty long answer with several good points on how it could help to enhance AI. There we have it! Blockchain is about to solve all problems we have today with AI! :D
  - philoinvestor 3y ago
    "Blockchain solves this..."
hackerlight 3y ago
AI has massively increased my productivity. There are real users like me who will continue to pay up. This is not the same.
- SunlitCat 3y ago
  Like with blockchain, there are real uses, of course i totally agree! But I was more thinking about the craze surrounding the whole thing, like with blockchain, you can see everyone trying to sell you AI for kinda everything.
- 3y ago

codexon 3y ago

This technology is already fully automating copywriters and almost replacing concept artists right now. However it is true that right now the valuations are for something far more than that, and so far it doesn't seem like LLMs will be able to do much more. I was talking to someone that just retired from a programming position at a FANG and he seems to think that AGI (artificial general intelligence) is only a few years away just based off what he sees with ChatGPT and he's dumping all his money into AI stocks. The level of hype and over-extrapolation is so absurd, and the fact that it can affect someone with a technical background... It really does seem like a bubble to me.

ForgotIdAgain 3y ago
Isn't the role of a concept artist mainly to do worldbuilding and drawing second? AI does not seem to have a good world model, they make pretty pictures but they lack thought behind them.
- codexon 3y ago
  I really don't know the details. You can see a concept artist here discovering he stopped getting work after a company splurted out that they switched to AI. https://twitter.com/_Dofresh_/status/1709519000844083290 https://twitter.com/_Dofresh_/status/1709519000844083290 My guess is that a lot of people can have ideas, so you don't need an artist to bring them to life anymore.
- aquova 3y ago
  Agreed, and I think there are a number of... over-enthusiastic executives with dollar signs in their eyes who are in for a rude awakening about this. It might sound great to replace your artistic staff with an LLM subscription, until you realize that you laid off all the creative vision with them. That isn't to say I think it'll go away though, I wouldn't be surprised if art students in the future are taught how to wrangle LLMs to supplement their own designs.

curtisblaine 3y ago

> When the AI bubble bursts I wouldn't be surprised if takes down major tech companies with it. Hopefully, knock wood. Maybe it will even slow down the genrral enshittification created by those major tech companies.

d--b 3y ago

Well that's your view, but we keep seeing incredible progress year on year. Noone thought beating the game of Go was feasible. Noone thought self-driving cars would actually work. Noone predicted ChatGPT. See where we're at now with multi modal models. And Sora. The truth is that you can't predict anything anymore about this tech cause all expectations keep being blown away. AGI may be right there, and that's what's driving the money.

ArchOversight 3y ago
> Noone thought self-driving cars would actually work. Many people thought self driving WOULD work and that we'd be further along than we are now. We have vastly overestimated how far we'd be, and vastly underestimated how much time and effort it would actually take. Self driving cars as they exist today are still mere toys compared to where the industry thought they were going to be. Look at Cruise, Waymo, Zoox, Uber's ex-self driving car division and others. We are not anywhere near the self-driving autonomous cars we had hoped for.
- deleted 3y ago
  [deleted]
SirMaster 3y ago
This doesn’t make any sense. If nobody thought the things were possible then why did they bother trying to do them? And even spend as much time and resources as they did trying to do them?
oblio 3y ago
> Noone thought beating the game of Go was feasible. Oh, yes, we did, once we beat chess. It was just a matter of time. > Noone thought self-driving cars would actually work. And... they don't? Call me when I can buy a regular car where I can sleep while traveling 8 hours, driven by the car itself. We're probably "flying cars" away from that.

huytersd 3y ago

Eh I don’t know. I find ChatGPT very useful atleast 10 times a day.

dorkwood 3y ago

This opinion is so crazy to me. How can it be a bubble if it's already providing me with 10x productivity gains? Things I've used GPT-4 to automate: replaying to all emails, writing entire books, doing all the legal paperwork for my new business, completing daily code challenges, generating shopping lists, writing birthday messages, and replying to my family group chat. And that's when the tech is still relatively new! Once the technology advances and I'm able to automate basically all of my daily tasks, who knows where I'll be.