12 ms·

Will A.I. Be a Bust? A Wall Street Skeptic Rings the Alarm

41 points by _rtyw 2y ago

tim333 2y ago
There may well be a difference between the value for society which will probably be a lot and the return for investors which may not be good. At the moment I'm enjoying using the AI but not paying anything. It may go a bit like the airline industry where overinvestment in planes tends to lead to price wars and the investors losing overall.
bbor 2y ago
Thanks, “head of stock research”. Definitely a real job that’s not at all made up. I’m sure he did a lot of chin stroking and graph glancing to come to this technical decision! Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… EDIT: I'm 'posting too fast', so I'll break the rules instead and post my response here: Thanks for the polite reply, despite the disagreement! No offense intended to any finance folks on here, but it's a murderously harmful industry built on lies. Being an expert in evaluating businesses in general is an absurd job, IMO; the whole system is a mix of gambling and coercion, and the veneer they put on it of "making the right plays" and "reading the market" is a tiny, tiny percentage of what they actually make money from, if it even works at all. In other words: what would you study to become an expert in the concept of predicting the future of all human activity? Here's the report discussed in this article: https://www.goldmansachs.com/images/migrated/insights/pages/gs-research/gen-ai--too-much-spend,-too-little-benefit-/TOM_AI%202.0_ForRedaction.pdf https://www.goldmansachs.com/images/migrated/insights/pages/... AFAICT, his entire argument boils down to this: In our experience, even basic summarization tasks often yield illegible and nonsensical results. This is not a matter of just some tweaks being required here and there; despite its expensive price tag, the technology is nowhere near where it needs to be in order to be useful for even such basic tasks. This analysis needs citations of academic discussion on the specifics of the new technologies and how exactly they will fit into existing ones, not "we tried it around the office and couldn't get it to work". Certainly the bosses at Xerox failed to see any use for PCs in their own lives; after all, it's quicker to call someone on the phone, and cheaper to just write a letter! Just like desktop PCs were a clunky presentiment of the countless applications of miniaturized computers (phones, smart appliances, automotive features, and microcontrollers in general), today's chatbots are a clunky presentiment of countless applications of intuitive algorithms (adaptive UX, actually helpful smart speakers, assistive technologies for the disabled, and self-improving systems in general). For the second point, here's his quote: Overbuilding things the world doesn’t have use for, or is not ready for, tends to end badly. This quote is either misguided or a completely empty tautology, depending on how much leeway you give to "overbuilding". The world definitely has a use for intuitive algorithms, but it definitely doesn't have a use for too many intuitive algorithms -- that's what "too many" means! TBF the "not needed" phrasing was a complete fabrication by NYT, so that's my bad.
- tivert 2y ago
  > Thanks, “head of stock research”. Definitely a real job that’s not at all made up. I’m sure he did a lot of chin stroking and graph glancing to come to this technical decision! Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… Why would you think "head of stock research" is a made up job? It is obvious that investors need to research the stocks the companies they invest in to figure out if they're good investments. > Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… It's your problem if you confuse "people trying to hype their AI products" with "scientists" and "not providing the hyped value" with "not needed."
- hypeatei 2y ago
  I hate to admit it, but we're basically in the same boat as him. White collar workers that sit in air conditioned buildings (or at home) that rely on power+internet all the time to be useful. Plus how much tech workers are actually doing groundbreaking scientific work? Probably less than 1%.
  - dghlsakjg 2y ago
    Eh. Many programming jobs are connected to the actual creation of real world value. As in, I can point to actual real life people from every programming job I've had that will say: "Yes, my life was improved by the use of your programs". The fact that I do it using a computer and a climate controlled office isn't really relevant. Stock traders are so abstracted from real human value, that it is not a stretch to say that their jobs do not add value as a whole to the world. If we had half as many people working in financializing the world, capital allocation would not suffer. At least that's my belief.
ronsor 2y ago
AI won't be a bust, but your company might be. Don't invest in something simply because it has the label "AI" slapped on somewhere.
deleted 2y ago
[deleted]
jacknews 2y ago
Sure AI is just nothing .. lol. Fckn bean counters, this just shows what's wrong with the current economic system. They've thrown money at AI, and, honestly, it isn't quite ready for it. But at the same time, it's an amazing advance, that's ignited the field and opened whole new vistas. Obviously, current AI is missing some very significant pieces of the puzzle to advance, but the current state is truly a giant step from just 10 years ago. What was the 'profit' in the first moon landings, an iconic historical achievement, for example? The 'no profit in it' naysayers just show that the capitalist model is not actually the thing responsible for the amazing innovation of the last 100+ years, and is wholly unsuitable for the next.
visarga 2y ago
[flagged]
FrustratedMonky 2y ago
There are now equal measures of Skeptics and Alarmist to Sales and Hype-men. So generally that there is an article about 'skeptics', do they really have some new take on this versus all of the 'skeptics' from a month ago, or a year ago.
havefunbesafe 2y ago
I'd suggest not, since it is integrated very deeply into my daily workflow.
- Mistletoe 2y ago
  Do you pay for it? Who do you pay? How much profit do they make from your payment? Is it more than the cost to them?
  - dghlsakjg 2y ago
    I'm not the OP, but yes, I pay for it. I pay OpenAI and Anthropic directly for API access that is hooked into a plugin on my IDE. I also use Chatbox, an app that lets me chat with them, using the API directly. No idea if they are making money on my use of their services, they haven't made that information public. If the price was higher I would still pay it. Given that they keep offering lower prices on newer models, I am inclined to say that they are making money on the incremental use of the models (which is basically the cost of renting a GPU). No idea if they are making enough to recoup the cost of research.
Wheaties466 2y ago
A.I. wont be a bust, but your investment in something simply because it "uses AI" might not be a smart choice. I can't blame people for attaching "uses AI" to their pitch to get funding. But I will blame people giving them money for not being able to tell the difference between something revolutionary and something that never needed AI in the first place.
- bigbinary 2y ago
  This has been a huge frustration with AI investments as I’m invest in industry and “AI ETFs” just invest in anything with AI on the website. Investors have absolutely no idea how AI works or what it will disrupt, and I genuinely think 99% of all investor sentiment towards AI is non-sense
  - michaelnny 2y ago
    The company I work for try to add AI/LLM on everything, instead of trying to improve/fix the underlying problem, they now just add the magic AI and everything is “perfect” now. As an ML engineer and AI developer, I don’t see the real value at all, not to mention the added cost of using LLM
    - CoastalCoder 2y ago
      Going down the tangent of people working in the industry... I unwittingly fell into low-level coding for DL software stacks about 7 years ago. At first I was merely uninterested in the topic, compared to my teammates. Now I think there's a serious possibility that LLMs and other new DL capabilities will be a net negative for society. I'm actively trying to get other work. I know that if I don't do the work others gladly will, but the status quo seers my conscience.
Workaccount2 2y ago
When progress decouples from investment is when I'd say there is a true bubble. But so far progress has continued to soar. Nobody thinks GPT4-o1 or Sonnet 3.5 is going to change the world. People are looking at the past 2-3 years though and extrapolating forward, and right now they don't see any evidence that progress will slow down. Quite the opposite actually. As for where that value will manifest itself the most in the stock market? That's probably where this guy is getting hung up.
- brigadier132 2y ago
  > Nobody thinks GPT4-o1 or Sonnet 3.5 is going to change the world They already have, people don't realize it because expectations have shifted so much because of how transformative it already is. I'm in a few communities that like to read novels from China / Korea. Claude Sonnet translates Mandarin to English almost perfectly. I also copy and paste screenshots of Mandarin into it and it transcribes it perfectly too. A universal language translator of this quality on its own would have been a billion dollar company a year before LLMs were released.
  - echelon 2y ago
    > I'm in a few communities that like to read novels from China / Korea. Claude Sonnet translates is able Mandarin to English almost perfectly. What novels are you reading? This is fascinating to me, because the world is quickly becoming a place where we have to choose which information from the unlimited information stream to consume. It feels like unlimited opportunity cost. I, for one, don't think I'll ever have enough time to watch every Academy Award nominated film (let alone all of the winners). And that's just one type of information. You're going after some obscure (?) stuff. What brought about the interest?
    - brigadier132 2y ago
      The novels I like the most right now are "Mysteries of the Immortal Puppet Master" and "Eternal tale" which are both just fun Chinese fantasy novels. > What brought about the interest? They are very unique coming from the perspective of an American that has mostly read books published by Western authors. There are all these unique fantasy tropes based on Chinese history that are like a parallel branch to Tolkein based fantasy. Also, you can clearly see that they have completely different value systems and ironically you can tell they are comparatively less censored.
dr-detroit 2y ago
[dead]
adamnemecek 2y ago
Why does Wall Street never ring alarm against Wall Street?
- more_corn 2y ago
  That would be a fun twist.
nine_zeros 2y ago
I hope a bunch of wealthy investors lose their shirts on AI "investments". No bailouts for them.
- deleted 2y ago
  [deleted]
mattgreenrocks 2y ago
Some oddly defensive reactions here. Wall St losing faith doesn't mean the tech is bad, just that they're not happy with the returns they're seeing. Plus, AI seems particularly susceptible to these extreme hype cycles. If it's legit, then it will pan out eventually. If not, then it will lay the foundation for something bigger.
- ADeerAppeared 2y ago
  > Some oddly defensive reactions here. They're not odd. These reactions pop up to all criticism of the current tech hype bubble. Happened with metaverse, NFTs, blockchain, etc. They know that the emperor has no clothes. That the moment people in power start asking "So... where's all the profit on this investment?" it's game over. AI is supported by massive subsidies and R&D from the big tech giants. Wall Street demanding that Microsoft stop wasting tens of billions on investment in a product that does not generate a profit for Microsoft will kill AI as it exists right now. OpenAI will raise their prices significantly, killing most-to-all of the startups relying on them. This is especially dire because there's copyright and regulatory changes going on. An AI winter now means there's substantial risk of the next "AI summer" being crippled by actually having to abide by copyright and being subject to regulations.
  - visarga 2y ago
    > OpenAI will raise their prices significantly, killing most to all of the startups relying on them. Have you heard the good news? The price per million tokens has fallen from $36 to $0.25 in the past 18 months. > actually having to abide by copyright Copyright is being eroded, first by the internet and its copying capabilities, then by the social networks and sharing, and now by generative AI. You can't make a profit owning expression in this distributed and interactive system, copyright was invented in the age of passive consumption of content. When you do a simple search you can find many alternatives to choose from. Any new work has to compete against decades of accumulation. On top of that, AI is not really infringing, or it's a bad infringement system - it's much slower and more imprecise than just copying, if infringement is what someone seeks. It's a guided remixing tool, there's a human shaping its output. How can a model 1000x smaller than its training set be really infringing, it has no space for all the exact details. OpenAI accumulates trillions of tokens in chat logs, eliciting experience from its users, it is crawling the tacit knowledge reservoir of its user base. That means it collects better information than web scrapers, information that would be normally lost. They can just sit there and people will bring data, guidance and feedback to the model. Do you see the business value in collecting practical experience and repackaging it?
fullshark 2y ago
Any new tech gets hyped to the moon because of theoretical use cases. The tech then comes up against genuine limitations and reality sets in. Work is done to get around the limitations, and useful products get built. However if you compare what got built to the theoretical products at the height of the hype cycle, you will find them wanting. AI (as in GenAI) will be no different. I would not call that a bust.
- jsheard 2y ago
  Which useful products ultimately came out of the Web3/Blockchain boom that preceded the AI boom?
  - throwup238 2y ago
    Ordering drugs online.
    - deleted 2y ago
      [deleted]
  - golergka 2y ago
    Depends on where do you live and what access to mainstream banking you have. Nowadays about 95% of money I spend goes through crypto, and honestly, I don't want to go back.
    - BriggyDwiggs42 2y ago
      What are your circumstances?
  - fullshark 2y ago
    A financial system for illegal transactions.
  - ZiiS 2y ago
    They revolutionised money laundering.
bottlepalm 2y ago
AI adoption is outpacing computers and the internet.. https://x.com/emollick/status/1838582600165670955 https://x.com/emollick/status/1838582600165670955
- usaar333 2y ago
  Can't really compare to stuff that requires hardware. The weakly bearish metric is that chatgpt's user growth is slightly slower than Facebook's was at similar user counts (2009 or so)
apwell23 2y ago
Can someone explain to me how OpenAI has billions in revenue. Almost no one I know outside of tech uses chatgpt with any regularity.
- gcr 2y ago
  They’ve got tons of B2B revenue from startups. VCs see it as speculative investments.
- minimaxir 2y ago
  Enterprise deals.
  - apwell23 2y ago
    Why are they paying for it if its not improving their profit ? I don't see any company mention profit gains from money they spent on chatgpt.
    - minimaxir 2y ago
      Business expenses in the real world aren't always "only spend on things that directly increase profit." It's harder to quantify a productivity increase. The ROI of generative AI can be debated, but at the least the companies are locked into year+ enterprise contracts which is actualized revenue for OpenAI. Those contracts may or may not get renewed.
- cut3 2y ago
  Really? Everyone outside of tech that Ive talked to uses it. I have a new mail carrier and I was chatting with her and she mentioned that she used chatgpt to complete her job application for the carrier position.
  - WithinReason 2y ago
    Did she pay for it?
  - 2y ago
snowwrestler 2y ago
AI has busted before and will bust again. It happens so often with AI that there is a standard metaphor for it: AI winter. The current technology of AI is not going to produce profits to justify the gargantuan levels of investment. Generative AIs excel at creative tasks, which is undoubtedly amazing, but creative industries have already had their margins beaten down by the hordes of humans who want to work in creative industries. You’re not going to create hundreds of $billions of revenue by replacing stock photography and blog post authors. In objective contexts, generative AIs struggle with reliability, which makes it hard for folks to build them into the critical systems necessary to generate huge revenue. There is a reason Google did not deploy generative AI into search until OpenAI basically forced them to. And now that Google has rolled it out, does anyone think it is driving huge new revenue for them? No. The reality is that much—maybe even most—of the current levels of investment are predicated on the idea that someone among the current crop of AI companies will create a “general intelligence” which will be intelligent and reliable enough to transform “hard” industries like energy, manufacturing, transportation, health care, etc. Let’s recognize that investment thesis for what it is, a speculative bet. No one even agrees how to define AGI, let alone understands the concept rigorously enough to calculate how to get there from ChatGPT.
- FrustratedMonky 2y ago
  This is the view of a year ago. This take is already outdated. There are already jobs being lost. You don't need to make "Billons", you just need a model cheap enough to be cheaper than the human being replaced. So if I can take one of the off the shelf models, and it costs me $20/week to replace a human that costs $1000/week, then there you go. It is already disruptive. People forget that there was a shit ton of investment in the early internet that also didn't pay off, but nobody would say that the internet didn't have some winners. Edit: Lot of people with head in sand. https://tech.co/news/companies-replace-workers-with-ai https://tech.co/news/companies-replace-workers-with-ai I'm already having to deal with AI when making reservations at Delta. Where do you think the people that used to take phone calls went? That is one company, one role.
  - actsasbuffoon 2y ago
jkaptur 2y ago
Some context that sometimes gets lost: this sort of research is, to put it crudely, content marketing for an investment bank. So when the article says "the firm began hosting private bull-and-bear debates" we can be sure that each attendee was met shortly thereafter by their friendly Goldman salesperson to talk about how to trade whichever way they wanted.
LarsDu88 2y ago
AI progress has been dramatic but the revenue doesn't even come close to the infra spend. Also companies like Meta have started to commoditize the models. Consumers could give less a shit about copilot enabled PCs. The actual revenue is in the future and requires more RnD. Many barriers to robotics and autonomy have started to fall. Drug development could greatly benefit from some of these advances. Ai spending is more about fear (of falling behind) than greed
jostmey 2y ago
My suspicion is that AI will simultaneously be a bust and a boom. I think virtually every AI startup won't survive because they just repackage existing AI services. It this sense, it is a bust for investors. But the use of ChatGPT and alternatives, the invention of better AI, and the demand for GPU cars will grow exponentially. In this sense, it is a boom
irisgrunn 2y ago
Probably. However impressive LLMs are, they're not AGI. For example this morning even, I was working together with a coworker and he used ChatGPT to ask for some examples. Unfortunately they didn't work, after reading the actual documentation it turned out that the structure had to be slightly different. This is the impression I get from everything that has been generated with "AI", on the face it looks great, but as soon as you start going into detail it's not right or just plainly wrong. The generated code had six fingers. They might be able to improve this eventually but I don't think it will ever be fixed because of the nature of LLMs.
- visarga 2y ago
  Have you pasted the documentation or asked it to search for recent docs on the task at hand? If not, you're using it wrong.
  - BriggyDwiggs42 2y ago
    This is usually not the problem
  - spacemadness 2y ago
    “You’re holding it wrong” strikes again.
hrzn 2y ago
We likely overestimate AI's short-term impact, and there might even be a financial bubble about to pop. But I also think we underestimate the long-term impact. We're building absolutely amazing capabilities faster than many would have thought possible only a few years ago - I especially think applications to science and engineering will be huge and transformative.
xnx 2y ago
Organizations (Salesforce, Adobe, etc.) that have lots of proprietary data (chats, documents, clickstream, etc.) will benefit from applying AI tools to their products to automate work. It' almost certainly folly for those companies to build novel foundation models themselves. There's also the possibility that this is a great and useful new technologies, but it becomes so cheap and democratized that there will be no big winner (aside from Nvidia stock price in the short to medium term).
throwawa14223 2y ago
At some point it will be considered professional negligence to use LLMs in any professional setting and I hope that day is soon.
fragmede 2y ago
Judging by the value of SMCI, it's already been busted.
bee_rider 2y ago
IMO, if AI pops, for the top 3 companies by market cap: Apple might not notice MS will be in trouble Nvidia will take a hit but as the premier designer of high-throughput compute devices and owner of the ecosystem, they’ll be well positioned to take advantage of the next thing.

41 points by _rtyw 2y ago

There may well be a difference between the value for society which will probably be a lot and the return for investors which may not be good. At the moment I'm enjoying using the AI but not paying anything. It may go a bit like the airline industry where overinvestment in planes tends to lead to price wars and the investors losing overall.

bbor 2y ago

Thanks, “head of stock research”. Definitely a real job that’s not at all made up. I’m sure he did a lot of chin stroking and graph glancing to come to this technical decision! Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… EDIT: I'm 'posting too fast', so I'll break the rules instead and post my response here: Thanks for the polite reply, despite the disagreement! No offense intended to any finance folks on here, but it's a murderously harmful industry built on lies. Being an expert in evaluating businesses in general is an absurd job, IMO; the whole system is a mix of gambling and coercion, and the veneer they put on it of "making the right plays" and "reading the market" is a tiny, tiny percentage of what they actually make money from, if it even works at all. In other words: what would you study to become an expert in the concept of predicting the future of all human activity? Here's the report discussed in this article: https://www.goldmansachs.com/images/migrated/insights/pages/gs-research/gen-ai--too-much-spend,-too-little-benefit-/TOM_AI%202.0_ForRedaction.pdf https://www.goldmansachs.com/images/migrated/insights/pages/... AFAICT, his entire argument boils down to this: In our experience, even basic summarization tasks often yield illegible and nonsensical results. This is not a matter of just some tweaks being required here and there; despite its expensive price tag, the technology is nowhere near where it needs to be in order to be useful for even such basic tasks. This analysis needs citations of academic discussion on the specifics of the new technologies and how exactly they will fit into existing ones, not "we tried it around the office and couldn't get it to work". Certainly the bosses at Xerox failed to see any use for PCs in their own lives; after all, it's quicker to call someone on the phone, and cheaper to just write a letter! Just like desktop PCs were a clunky presentiment of the countless applications of miniaturized computers (phones, smart appliances, automotive features, and microcontrollers in general), today's chatbots are a clunky presentiment of countless applications of intuitive algorithms (adaptive UX, actually helpful smart speakers, assistive technologies for the disabled, and self-improving systems in general). For the second point, here's his quote: Overbuilding things the world doesn’t have use for, or is not ready for, tends to end badly. This quote is either misguided or a completely empty tautology, depending on how much leeway you give to "overbuilding". The world definitely has a use for intuitive algorithms, but it definitely doesn't have a use for too many intuitive algorithms -- that's what "too many" means! TBF the "not needed" phrasing was a complete fabrication by NYT, so that's my bad.

tivert 2y ago
> Thanks, “head of stock research”. Definitely a real job that’s not at all made up. I’m sure he did a lot of chin stroking and graph glancing to come to this technical decision! Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… Why would you think "head of stock research" is a made up job? It is obvious that investors need to research the stocks the companies they invest in to figure out if they're good investments. > Someone should let all the scientists know that they’re wrong, and intuitive algorithms are “not needed”… It's your problem if you confuse "people trying to hype their AI products" with "scientists" and "not providing the hyped value" with "not needed."
hypeatei 2y ago
I hate to admit it, but we're basically in the same boat as him. White collar workers that sit in air conditioned buildings (or at home) that rely on power+internet all the time to be useful. Plus how much tech workers are actually doing groundbreaking scientific work? Probably less than 1%.
- dghlsakjg 2y ago
  Eh. Many programming jobs are connected to the actual creation of real world value. As in, I can point to actual real life people from every programming job I've had that will say: "Yes, my life was improved by the use of your programs". The fact that I do it using a computer and a climate controlled office isn't really relevant. Stock traders are so abstracted from real human value, that it is not a stretch to say that their jobs do not add value as a whole to the world. If we had half as many people working in financializing the world, capital allocation would not suffer. At least that's my belief.

ronsor 2y ago

AI won't be a bust, but your company might be. Don't invest in something simply because it has the label "AI" slapped on somewhere.

deleted 2y ago

[deleted]

jacknews 2y ago

Sure AI is just nothing .. lol. Fckn bean counters, this just shows what's wrong with the current economic system. They've thrown money at AI, and, honestly, it isn't quite ready for it. But at the same time, it's an amazing advance, that's ignited the field and opened whole new vistas. Obviously, current AI is missing some very significant pieces of the puzzle to advance, but the current state is truly a giant step from just 10 years ago. What was the 'profit' in the first moon landings, an iconic historical achievement, for example? The 'no profit in it' naysayers just show that the capitalist model is not actually the thing responsible for the amazing innovation of the last 100+ years, and is wholly unsuitable for the next.

visarga 2y ago

[flagged]

FrustratedMonky 2y ago

There are now equal measures of Skeptics and Alarmist to Sales and Hype-men. So generally that there is an article about 'skeptics', do they really have some new take on this versus all of the 'skeptics' from a month ago, or a year ago.

havefunbesafe 2y ago

I'd suggest not, since it is integrated very deeply into my daily workflow.

Mistletoe 2y ago
Do you pay for it? Who do you pay? How much profit do they make from your payment? Is it more than the cost to them?
- dghlsakjg 2y ago
  I'm not the OP, but yes, I pay for it. I pay OpenAI and Anthropic directly for API access that is hooked into a plugin on my IDE. I also use Chatbox, an app that lets me chat with them, using the API directly. No idea if they are making money on my use of their services, they haven't made that information public. If the price was higher I would still pay it. Given that they keep offering lower prices on newer models, I am inclined to say that they are making money on the incremental use of the models (which is basically the cost of renting a GPU). No idea if they are making enough to recoup the cost of research.

Wheaties466 2y ago

A.I. wont be a bust, but your investment in something simply because it "uses AI" might not be a smart choice. I can't blame people for attaching "uses AI" to their pitch to get funding. But I will blame people giving them money for not being able to tell the difference between something revolutionary and something that never needed AI in the first place.

bigbinary 2y ago
This has been a huge frustration with AI investments as I’m invest in industry and “AI ETFs” just invest in anything with AI on the website. Investors have absolutely no idea how AI works or what it will disrupt, and I genuinely think 99% of all investor sentiment towards AI is non-sense
- michaelnny 2y ago
  The company I work for try to add AI/LLM on everything, instead of trying to improve/fix the underlying problem, they now just add the magic AI and everything is “perfect” now. As an ML engineer and AI developer, I don’t see the real value at all, not to mention the added cost of using LLM
  - CoastalCoder 2y ago
    Going down the tangent of people working in the industry... I unwittingly fell into low-level coding for DL software stacks about 7 years ago. At first I was merely uninterested in the topic, compared to my teammates. Now I think there's a serious possibility that LLMs and other new DL capabilities will be a net negative for society. I'm actively trying to get other work. I know that if I don't do the work others gladly will, but the status quo seers my conscience.

Workaccount2 2y ago

When progress decouples from investment is when I'd say there is a true bubble. But so far progress has continued to soar. Nobody thinks GPT4-o1 or Sonnet 3.5 is going to change the world. People are looking at the past 2-3 years though and extrapolating forward, and right now they don't see any evidence that progress will slow down. Quite the opposite actually. As for where that value will manifest itself the most in the stock market? That's probably where this guy is getting hung up.

brigadier132 2y ago
> Nobody thinks GPT4-o1 or Sonnet 3.5 is going to change the world They already have, people don't realize it because expectations have shifted so much because of how transformative it already is. I'm in a few communities that like to read novels from China / Korea. Claude Sonnet translates Mandarin to English almost perfectly. I also copy and paste screenshots of Mandarin into it and it transcribes it perfectly too. A universal language translator of this quality on its own would have been a billion dollar company a year before LLMs were released.
- echelon 2y ago
  > I'm in a few communities that like to read novels from China / Korea. Claude Sonnet translates is able Mandarin to English almost perfectly. What novels are you reading? This is fascinating to me, because the world is quickly becoming a place where we have to choose which information from the unlimited information stream to consume. It feels like unlimited opportunity cost. I, for one, don't think I'll ever have enough time to watch every Academy Award nominated film (let alone all of the winners). And that's just one type of information. You're going after some obscure (?) stuff. What brought about the interest?
  - brigadier132 2y ago
    The novels I like the most right now are "Mysteries of the Immortal Puppet Master" and "Eternal tale" which are both just fun Chinese fantasy novels. > What brought about the interest? They are very unique coming from the perspective of an American that has mostly read books published by Western authors. There are all these unique fantasy tropes based on Chinese history that are like a parallel branch to Tolkein based fantasy. Also, you can clearly see that they have completely different value systems and ironically you can tell they are comparatively less censored.

dr-detroit 2y ago

[dead]

adamnemecek 2y ago

Why does Wall Street never ring alarm against Wall Street?

more_corn 2y ago
That would be a fun twist.

nine_zeros 2y ago

I hope a bunch of wealthy investors lose their shirts on AI "investments". No bailouts for them.

deleted 2y ago
[deleted]

mattgreenrocks 2y ago

Some oddly defensive reactions here. Wall St losing faith doesn't mean the tech is bad, just that they're not happy with the returns they're seeing. Plus, AI seems particularly susceptible to these extreme hype cycles. If it's legit, then it will pan out eventually. If not, then it will lay the foundation for something bigger.

ADeerAppeared 2y ago
> Some oddly defensive reactions here. They're not odd. These reactions pop up to all criticism of the current tech hype bubble. Happened with metaverse, NFTs, blockchain, etc. They know that the emperor has no clothes. That the moment people in power start asking "So... where's all the profit on this investment?" it's game over. AI is supported by massive subsidies and R&D from the big tech giants. Wall Street demanding that Microsoft stop wasting tens of billions on investment in a product that does not generate a profit for Microsoft will kill AI as it exists right now. OpenAI will raise their prices significantly, killing most-to-all of the startups relying on them. This is especially dire because there's copyright and regulatory changes going on. An AI winter now means there's substantial risk of the next "AI summer" being crippled by actually having to abide by copyright and being subject to regulations.
- visarga 2y ago
  > OpenAI will raise their prices significantly, killing most to all of the startups relying on them. Have you heard the good news? The price per million tokens has fallen from $36 to $0.25 in the past 18 months. > actually having to abide by copyright Copyright is being eroded, first by the internet and its copying capabilities, then by the social networks and sharing, and now by generative AI. You can't make a profit owning expression in this distributed and interactive system, copyright was invented in the age of passive consumption of content. When you do a simple search you can find many alternatives to choose from. Any new work has to compete against decades of accumulation. On top of that, AI is not really infringing, or it's a bad infringement system - it's much slower and more imprecise than just copying, if infringement is what someone seeks. It's a guided remixing tool, there's a human shaping its output. How can a model 1000x smaller than its training set be really infringing, it has no space for all the exact details. OpenAI accumulates trillions of tokens in chat logs, eliciting experience from its users, it is crawling the tacit knowledge reservoir of its user base. That means it collects better information than web scrapers, information that would be normally lost. They can just sit there and people will bring data, guidance and feedback to the model. Do you see the business value in collecting practical experience and repackaging it?

fullshark 2y ago

Any new tech gets hyped to the moon because of theoretical use cases. The tech then comes up against genuine limitations and reality sets in. Work is done to get around the limitations, and useful products get built. However if you compare what got built to the theoretical products at the height of the hype cycle, you will find them wanting. AI (as in GenAI) will be no different. I would not call that a bust.

jsheard 2y ago
Which useful products ultimately came out of the Web3/Blockchain boom that preceded the AI boom?
- throwup238 2y ago
  Ordering drugs online.
  - deleted 2y ago
    [deleted]
- golergka 2y ago
  Depends on where do you live and what access to mainstream banking you have. Nowadays about 95% of money I spend goes through crypto, and honestly, I don't want to go back.
  - BriggyDwiggs42 2y ago
    What are your circumstances?
- fullshark 2y ago
  A financial system for illegal transactions.
- ZiiS 2y ago
  They revolutionised money laundering.

bottlepalm 2y ago

AI adoption is outpacing computers and the internet.. https://x.com/emollick/status/1838582600165670955 https://x.com/emollick/status/1838582600165670955

usaar333 2y ago
Can't really compare to stuff that requires hardware. The weakly bearish metric is that chatgpt's user growth is slightly slower than Facebook's was at similar user counts (2009 or so)

apwell23 2y ago

Can someone explain to me how OpenAI has billions in revenue. Almost no one I know outside of tech uses chatgpt with any regularity.

gcr 2y ago
They’ve got tons of B2B revenue from startups. VCs see it as speculative investments.
minimaxir 2y ago
Enterprise deals.
- apwell23 2y ago
  Why are they paying for it if its not improving their profit ? I don't see any company mention profit gains from money they spent on chatgpt.
  - minimaxir 2y ago
    Business expenses in the real world aren't always "only spend on things that directly increase profit." It's harder to quantify a productivity increase. The ROI of generative AI can be debated, but at the least the companies are locked into year+ enterprise contracts which is actualized revenue for OpenAI. Those contracts may or may not get renewed.
cut3 2y ago
Really? Everyone outside of tech that Ive talked to uses it. I have a new mail carrier and I was chatting with her and she mentioned that she used chatgpt to complete her job application for the carrier position.
- WithinReason 2y ago
  Did she pay for it?
- 2y ago

snowwrestler 2y ago

AI has busted before and will bust again. It happens so often with AI that there is a standard metaphor for it: AI winter. The current technology of AI is not going to produce profits to justify the gargantuan levels of investment. Generative AIs excel at creative tasks, which is undoubtedly amazing, but creative industries have already had their margins beaten down by the hordes of humans who want to work in creative industries. You’re not going to create hundreds of $billions of revenue by replacing stock photography and blog post authors. In objective contexts, generative AIs struggle with reliability, which makes it hard for folks to build them into the critical systems necessary to generate huge revenue. There is a reason Google did not deploy generative AI into search until OpenAI basically forced them to. And now that Google has rolled it out, does anyone think it is driving huge new revenue for them? No. The reality is that much—maybe even most—of the current levels of investment are predicated on the idea that someone among the current crop of AI companies will create a “general intelligence” which will be intelligent and reliable enough to transform “hard” industries like energy, manufacturing, transportation, health care, etc. Let’s recognize that investment thesis for what it is, a speculative bet. No one even agrees how to define AGI, let alone understands the concept rigorously enough to calculate how to get there from ChatGPT.

FrustratedMonky 2y ago
This is the view of a year ago. This take is already outdated. There are already jobs being lost. You don't need to make "Billons", you just need a model cheap enough to be cheaper than the human being replaced. So if I can take one of the off the shelf models, and it costs me $20/week to replace a human that costs $1000/week, then there you go. It is already disruptive. People forget that there was a shit ton of investment in the early internet that also didn't pay off, but nobody would say that the internet didn't have some winners. Edit: Lot of people with head in sand. https://tech.co/news/companies-replace-workers-with-ai https://tech.co/news/companies-replace-workers-with-ai I'm already having to deal with AI when making reservations at Delta. Where do you think the people that used to take phone calls went? That is one company, one role.
- actsasbuffoon 2y ago

jkaptur 2y ago

Some context that sometimes gets lost: this sort of research is, to put it crudely, content marketing for an investment bank. So when the article says "the firm began hosting private bull-and-bear debates" we can be sure that each attendee was met shortly thereafter by their friendly Goldman salesperson to talk about how to trade whichever way they wanted.

LarsDu88 2y ago

AI progress has been dramatic but the revenue doesn't even come close to the infra spend. Also companies like Meta have started to commoditize the models. Consumers could give less a shit about copilot enabled PCs. The actual revenue is in the future and requires more RnD. Many barriers to robotics and autonomy have started to fall. Drug development could greatly benefit from some of these advances. Ai spending is more about fear (of falling behind) than greed

jostmey 2y ago

My suspicion is that AI will simultaneously be a bust and a boom. I think virtually every AI startup won't survive because they just repackage existing AI services. It this sense, it is a bust for investors. But the use of ChatGPT and alternatives, the invention of better AI, and the demand for GPU cars will grow exponentially. In this sense, it is a boom

irisgrunn 2y ago

Probably. However impressive LLMs are, they're not AGI. For example this morning even, I was working together with a coworker and he used ChatGPT to ask for some examples. Unfortunately they didn't work, after reading the actual documentation it turned out that the structure had to be slightly different. This is the impression I get from everything that has been generated with "AI", on the face it looks great, but as soon as you start going into detail it's not right or just plainly wrong. The generated code had six fingers. They might be able to improve this eventually but I don't think it will ever be fixed because of the nature of LLMs.

visarga 2y ago
Have you pasted the documentation or asked it to search for recent docs on the task at hand? If not, you're using it wrong.
- BriggyDwiggs42 2y ago
  This is usually not the problem
- spacemadness 2y ago
  “You’re holding it wrong” strikes again.

hrzn 2y ago

We likely overestimate AI's short-term impact, and there might even be a financial bubble about to pop. But I also think we underestimate the long-term impact. We're building absolutely amazing capabilities faster than many would have thought possible only a few years ago - I especially think applications to science and engineering will be huge and transformative.

xnx 2y ago

Organizations (Salesforce, Adobe, etc.) that have lots of proprietary data (chats, documents, clickstream, etc.) will benefit from applying AI tools to their products to automate work. It' almost certainly folly for those companies to build novel foundation models themselves. There's also the possibility that this is a great and useful new technologies, but it becomes so cheap and democratized that there will be no big winner (aside from Nvidia stock price in the short to medium term).

throwawa14223 2y ago

At some point it will be considered professional negligence to use LLMs in any professional setting and I hope that day is soon.

fragmede 2y ago

Judging by the value of SMCI, it's already been busted.

bee_rider 2y ago

IMO, if AI pops, for the top 3 companies by market cap: Apple might not notice MS will be in trouble Nvidia will take a hit but as the premier designer of high-throughput compute devices and owner of the ecosystem, they’ll be well positioned to take advantage of the next thing.