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I think a key point from this article that I agree strongly with is the simple point that it is crucial that everyone recognise we are currently in an AI bubble

by zmmmmm 1y ago

I think a key point from this article that I agree strongly with is the simple point that it is crucial that everyone recognise we are currently in an AI bubble. I often find people contest this with the non-sequitur of "No, it's not a bubble, there is real value there. We are building things with it". The fact there is real value in the technology does not contradict in any way that we are in a bubble. It may even be supporting evidence for it. Compare with the dot com bubble : nobody would tell you there was no value in the internet. But it was still a bubble. A massive hyper inflated bubble. And when it popped, it left large swathes of the industry devastated even while a residual set of companies were left to carry on and build the "real" eventual internet based reworking of the entire economy which took 10 - 15 years. People would be well advised to have a look at this point in time at who survived the dot com bubble and why.

worldsayshi 1y ago
Once there's a consensus around a bubble the bubble has already burst?
- minraws 1y ago
  Not really I searched up some of articles from 1996/97 dot com was already a bubble in 97... But it had minor 15-20% corrections but kept rising for another year or two after that... Bubbles are driving by irrational beliefs. And they won't be irrational if we could understand them. AI is surely a bubble but it can go on for another 3-4 years when something possibly unrelated to AI pops it.
asdev 1y ago
everyone does NOT recognize it, just go on Twitter if you don't think so
entropsilk 1y ago
The fact everyone thinks we are in an AI bubble is practically proof we are not in an AI bubble. The crowd is always wrong on these things. Just like everyone "knew" we were going into a deep recession sometime in late 2022, early 2023. The crowd has an incredibly short memory too. What it means is that people are really cautious about AI. That is not a self reinforcing, fear of missing out, explosive process bubble. That is a classic bull market climbing a wall of worry.
- layer8 1y ago
  But it's not true that everyone thinks we are in an AI bubble.
  - UncleOxidant 1y ago
    Most people don't think they're in a bubble until it starts to pop.
    - layer8 1y ago
      So you seem to be opposing entropsilk‘s argument, same as I did.
- PessimalDecimal 1y ago
  There is absolutely FOMO. It's even being deliberately stoked. "AI won't take your job. People using AI will." This is this hype cycle's "have fun being poor."
- dustingetz 1y ago
  technical ICs actually trialing the AI tools think we’re in a bubble. Executives, boards, directors and managers are still tumbling head over heels down the mountain in a race to shovel more money into the fire, because their engineering orgs are not delivering results and they are desperate to find a solution
  - stego-tech 1y ago
    This. Highly competent technical ICs in my circles continue to (metaphorically) scream at their Juniors submitting AI slop and being unable to describe what it's doing, why it's doing it that way, or how they could optimize it further, since all management cares about is "that it works". Current models excel because of the corpus of the open internet they (stole from) built off of. New languages aren't likely to see as consistent results as old ones simply because these pattern matchers are trained on past history and not new information (see Rust vs C). I think the fact nobody's minting billions turning LLMs into trading bots should be pretty telling in that regard, since finance is a blend of relying on old data for models and intuiting new patterns from fresh data - in other words, directly targeting the weak points of LLMs specifically (inability to adapt to real-time data streams over the long haul). AI's not going away, and I don't think even the doomiest of AI doomers is claiming or hoping for that. Rather, we're at a crossroads like you say: stakeholders want more money and higher returns (which AI promises), while the people doing the actual work are trying to highlight that internal strife and politics are the holdups, not a lack of brute-force AI. Meanwhile both sides are trying to rattle the proverbial prison bars over the threats to employment real AI will pose (and the threats current LLMs pose to society writ large), but the booster side's actions (e.g., donating to far-right candidates that oppose the very social reforms AI CEOs claim are needed) betray their real motives: more money, less workers, more power.
cj 1y ago
I agree, although bubbles don’t always have to pop in huge ways like it did in the dot com crash. E.g. crypto displayed many, many characteristics of a bubble for a number of years, but the crypto bubble seems like it has just slowly stopped growing and slowly stopped getting larger, rather than popping in a fantastical way. (Not to say it still can’t, of course) Then again, this bubble is different in that it has engulfed the entire US economy (including public companies, which is the scary part since the damage potential isn’t limited to private investors). If there’s even a 10% chance of it popping, that’s incredibly frightening.
- xsmasher 1y ago
  Cryptocurrencies have survived and thrived, but anyone who went all-in on NFTs or blockchain gaming (or anything other than currency on the blockchain?) has been zeroed out.
- libraryofbabel 1y ago
  I think this is a really insightful point. Even if we are in a bubble now, in the sense that current LLM technology (impressive though it is) does not quite live up to the huge valuations of AI companies, there is a plausible future in which we get enough technological progress in the next few years that the bubble never really pops and we are able to morph into a new AI-driven economy without a crash. There are probably good historical examples of this happening with other technologies, although it’s hard to identify them because in retrospect it looks like the optimists invested rationally, even though their bets maybe weren’t all that justified at the time. I personally think a crash is more likely than not, but I think we should not assume that history will follow a particular pattern like the dot com bust. There are a variety of ways this can go and anyone who tells you they know how it’s all going to shake out is either guessing or trying to sell you something. It is for sure an interesting time to be in the industry. We’ll be able to tell the next generation a lot of stories.
  - zmmmmm 1y ago
    It's a good analysis. For me the big concern is really the level of detachment from reality that I'm seeing around time scales. People in the startup world seem to utterly fail to appreciate the complexity of changing business processes - for any type of change, let alone for an immature tech where there are still fundamental unsolved problems. The only way for the value of AI to be realised is for large scape business adoption to happen, and that is simply not achievable in the 2 years of runway most of these companies seem to be on.
digitcatphd 1y ago
Agreed. I think most of the arguments are premised on AI getting infinitely better for some reason, without anyone outlining clear arguments addressing the inherent architectural limitations of today's LLMs. I have been in this space since 2021 and honestly, beside maybe voice and Gemini Deep Research, things aren't much better than GPT-4.

by zmmmmm 1y ago

worldsayshi 1y ago

Once there's a consensus around a bubble the bubble has already burst?

minraws 1y ago
Not really I searched up some of articles from 1996/97 dot com was already a bubble in 97... But it had minor 15-20% corrections but kept rising for another year or two after that... Bubbles are driving by irrational beliefs. And they won't be irrational if we could understand them. AI is surely a bubble but it can go on for another 3-4 years when something possibly unrelated to AI pops it.

asdev 1y ago

everyone does NOT recognize it, just go on Twitter if you don't think so

entropsilk 1y ago

The fact everyone thinks we are in an AI bubble is practically proof we are not in an AI bubble. The crowd is always wrong on these things. Just like everyone "knew" we were going into a deep recession sometime in late 2022, early 2023. The crowd has an incredibly short memory too. What it means is that people are really cautious about AI. That is not a self reinforcing, fear of missing out, explosive process bubble. That is a classic bull market climbing a wall of worry.

layer8 1y ago
But it's not true that everyone thinks we are in an AI bubble.
- UncleOxidant 1y ago
  Most people don't think they're in a bubble until it starts to pop.
  - layer8 1y ago
    So you seem to be opposing entropsilk‘s argument, same as I did.
PessimalDecimal 1y ago
There is absolutely FOMO. It's even being deliberately stoked. "AI won't take your job. People using AI will." This is this hype cycle's "have fun being poor."
dustingetz 1y ago
technical ICs actually trialing the AI tools think we’re in a bubble. Executives, boards, directors and managers are still tumbling head over heels down the mountain in a race to shovel more money into the fire, because their engineering orgs are not delivering results and they are desperate to find a solution
- stego-tech 1y ago
  This. Highly competent technical ICs in my circles continue to (metaphorically) scream at their Juniors submitting AI slop and being unable to describe what it's doing, why it's doing it that way, or how they could optimize it further, since all management cares about is "that it works". Current models excel because of the corpus of the open internet they (stole from) built off of. New languages aren't likely to see as consistent results as old ones simply because these pattern matchers are trained on past history and not new information (see Rust vs C). I think the fact nobody's minting billions turning LLMs into trading bots should be pretty telling in that regard, since finance is a blend of relying on old data for models and intuiting new patterns from fresh data - in other words, directly targeting the weak points of LLMs specifically (inability to adapt to real-time data streams over the long haul). AI's not going away, and I don't think even the doomiest of AI doomers is claiming or hoping for that. Rather, we're at a crossroads like you say: stakeholders want more money and higher returns (which AI promises), while the people doing the actual work are trying to highlight that internal strife and politics are the holdups, not a lack of brute-force AI. Meanwhile both sides are trying to rattle the proverbial prison bars over the threats to employment real AI will pose (and the threats current LLMs pose to society writ large), but the booster side's actions (e.g., donating to far-right candidates that oppose the very social reforms AI CEOs claim are needed) betray their real motives: more money, less workers, more power.

cj 1y ago

I agree, although bubbles don’t always have to pop in huge ways like it did in the dot com crash. E.g. crypto displayed many, many characteristics of a bubble for a number of years, but the crypto bubble seems like it has just slowly stopped growing and slowly stopped getting larger, rather than popping in a fantastical way. (Not to say it still can’t, of course) Then again, this bubble is different in that it has engulfed the entire US economy (including public companies, which is the scary part since the damage potential isn’t limited to private investors). If there’s even a 10% chance of it popping, that’s incredibly frightening.

xsmasher 1y ago
Cryptocurrencies have survived and thrived, but anyone who went all-in on NFTs or blockchain gaming (or anything other than currency on the blockchain?) has been zeroed out.
libraryofbabel 1y ago
I think this is a really insightful point. Even if we are in a bubble now, in the sense that current LLM technology (impressive though it is) does not quite live up to the huge valuations of AI companies, there is a plausible future in which we get enough technological progress in the next few years that the bubble never really pops and we are able to morph into a new AI-driven economy without a crash. There are probably good historical examples of this happening with other technologies, although it’s hard to identify them because in retrospect it looks like the optimists invested rationally, even though their bets maybe weren’t all that justified at the time. I personally think a crash is more likely than not, but I think we should not assume that history will follow a particular pattern like the dot com bust. There are a variety of ways this can go and anyone who tells you they know how it’s all going to shake out is either guessing or trying to sell you something. It is for sure an interesting time to be in the industry. We’ll be able to tell the next generation a lot of stories.
- zmmmmm 1y ago
  It's a good analysis. For me the big concern is really the level of detachment from reality that I'm seeing around time scales. People in the startup world seem to utterly fail to appreciate the complexity of changing business processes - for any type of change, let alone for an immature tech where there are still fundamental unsolved problems. The only way for the value of AI to be realised is for large scape business adoption to happen, and that is simply not achievable in the 2 years of runway most of these companies seem to be on.

digitcatphd 1y ago

Agreed. I think most of the arguments are premised on AI getting infinitely better for some reason, without anyone outlining clear arguments addressing the inherent architectural limitations of today's LLMs. I have been in this space since 2021 and honestly, beside maybe voice and Gemini Deep Research, things aren't much better than GPT-4.