8 ms·
Say farewell to the AI bubble, and get ready for the crash
- mgarfias 1y agoSome of us have lived through multiple bubbles and know that often, the underlying bits are useful and will gain widespread acceptance. Just play long, and don’t feed the hypemonster.
- mitchbob 1y agohttps://archive.ph/2025.08.20-113134/https://www.latimes.com/business/story/2025-08-20/say-farewell-to-the-ai-bubble-and-get-ready-for-the-crash https://archive.ph/2025.08.20-113134/https://www.latimes.com...
- jqpabc123 1y agoAfter the crash, tech "industry leaders" will struggle to explain why/how they were conned into believing that intelligence was a simple database function with some probability and statistics sprinkled on top.
- Zealotux 1y agoI remain convinced the whole hype was a way to overfire after the big overhire.
- toomuchtodo 1y agoThey're still aggressively outsourcing to India, the Philippines, and LATAM under cover of AI to tighten the screws on labor costs. Domestic hiring that drags on is to pull in new employees at current lower market wages that will be sticky for some time.
- AbstractH24 1y agoEventually, we're going to have to stop living in the shadow of the excess in tech that was 2020-21. Are we there yet?
- deleted 1y ago[deleted]
- lbrito 1y agoBut who's to say humans are any different than simple databases with probability and statistics firing neurons?? /s
- naasking 1y ago> But who's to say humans are any different than simple databases with probability and statistics firing neurons?? Nobody has said they're simple databases, they would obviously be complex databases.
- jqpabc123 1y agoSome of them are very much like this. They think *intelligence* is a measure of your ability to regurgitate data that you have been fed. A genius is someone who wins on Jeopardy. In engineering school, it was easy to spot the professors who taught this way. I avoided them like the plague.
- mrguyorama 1y agoNo they won't. They won't struggle to explain anything because in US business culture, nobody ever actually takes blame except underlings. Nobody ever even asks them to explain themselves. Even in public companies it seems like questions from shareholders that actually get asked in quarterly calls are vague humble brags. "What are we going to do about the problem of winning so hard" while they had record layoffs the previous quarter. Those talking heads haven't had to mea culpa for : Hype about Hadoop, hype about blockchain, hype about no code, hype about the previous AI bubble, hype about "agile", hype about whatever JS script is popular this week, etc.
- karmakurtisaani 1y agoWe don't have to look far for examples. Meta dropped VR in favor of AI without much explanation. All they need is just start talking about the next shiny thing.
- bugjoey 1y agoThe internet didn't go away after the dotcom crash in early 2k, so the AI *IF* such crash happens. There're a lot of business discovering its benefits now, companies will continue building things over it.
- deleted 1y ago[deleted]
- anuramat 1y agothis is just wrong you could say "it's just matrix multiplication"; but then quantum mechanics (and thus chemistry, biology, and everything on top of that) is just linear algebra
- pera 1y agoI just don't get why did Altman had to hype this release so much, what was the plan? Also, what was the deal with all those mysterious Star Wars pictures?
- bgwalter 1y agoInitially politicians were responsive. In Feb. 2024 he sought trillions of investment to ramp up "AI" [1]. Then he got the White House announcement with Trump and Softbank for the $500 billion Stargate deal. The project has flopped, only one data center will be built. So I assume he thought hype would work again, but people are beginning to scrutinize the real capabilities of "AI". [1] https://www.wsj.com/tech/ai/sam-altman-seeks-trillions-of-dollars-to-reshape-business-of-chips-and-ai-89ab3db0 https://www.wsj.com/tech/ai/sam-altman-seeks-trillions-of-do...
- pj_mukh 1y agoI think the announcement was mostly a ploy to get OpenAI access to the White House and not much else (especially because Musk was already in there). But they are clearly on their way to build 20 data centers[1]. OpenAI raising $500B over 10-15 years to build inference capacity isn’t really that hard to believe or that impressive at this point tbh. Like that could just be venture debt that is constantly serviced. [1]: https://builtin.com/articles/stargate-project https://builtin.com/articles/stargate-project
- AbstractH24 1y agoI'm starting to think he's playing the long game. To make OpenAI what Amazon and Google were in the dot com bubble. The last people standing. And he's not the only one, a handful of companies are well aware that we're nearing the peak of a hype cycle and making sure they can survive the burst.
- egypturnash 1y agoI sure am looking forwards to what will happen to my power bill once Facebook decides to default on its share of the bill for the massive power plants Entergy is building solely to power the huge-ass data center FB's building in northern Louisiana. https://www.knoe.com/2025/08/19/entergy-power-plant-meta-data-center-moves-toward-early-regulatory-approval/ https://www.knoe.com/2025/08/19/entergy-power-plant-meta-dat...
- selimthegrim 1y agoI was just in the Louisiana public service commission meeting where Entergy told the regulators that Meta Platforms was worth 2 trillion and they got some opinion from a New York law firm that their word was good so YOLO. Passed 4-1. The exact words were “Meta Platforms is worth more than the five biggest banks combined” (implying no point in asking a bank for a loan guarantee or backstop)
- morkalork 1y agoThey really went with the "it's too big to fail" argument hah. Not that I'd be afraid of that, just their short attention span. How is the meta verse these days anyways?
- egypturnash 1y agouuuuugggggggghhhhhhhhhhhh I hate this future so much.
- deleted 1y ago[deleted]
- andrewstuart 1y agoMeh. Crashes come when there was no real business value. I use AI all day and I’m sure I’m not the only one.
- kg 1y agoThere was a lot of business value during the dotcom boom and we still had a crash. The question is how many AI companies have strong fundamentals and will survive, vs the ones that have weak fundamentals and will die if/when the investment money dries up.
- m_fayer 1y agoThe sad thing about bubbles based on overhyped but nevertheless useful tech is the collateral damage of the pop. Small promising companies that are simply too young to have good fundamentals will go under from the backlash created among investors and potential customers. It’s destruction that could’ve been avoided if we had a more measured and sober society that doesn’t need a new craze every 5 years.
- lazide 1y agopets.com
- benreesman 1y agoI also consume all the heavily sibsidized LLM tokens I can find a use for. Great deal for us, the people who funded it? Not so fun.
- torginus 1y agoLLMs also cost what they cost because NVIDIA won't sell you a 5090 upgraded with 80GB RAM for $3000 instead of $2000 (which is overkill in the first place). Yo have to buy a H200 for $40000
- m4rtink 1y agoIf there is demand, someone will sell that eventually - while NVIDIA has a headstart, they "just" fab stuff on TSMC anyway. AMD and to a degree Intel are already starting to sell cards with more VRAM.
- webdevver 1y agonothing ever happens
- pelagicAustral 1y agotap tap tap
- aydyn 1y agoWell would you look at the time.
- 1945 1y agoThe author isn't exactly a thought leader in the space, or really any space for that matter. Opinion worth nothing.
- nathan_compton 1y agoI've never met a "thought leader" whose opinion was worth anything.
- aydyn 1y ago"Thought leader" isn't an actual title (or at least it shouldn't be). In my mind, its simply someone who you recognize as having the expertise worth paying attention to.
- cjbgkagh 1y agoIt’s a title that is given to people to get them to present at junkets, a modern socially and legally acceptable way to bribe people. No one should take them seriously.
- aydyn 1y agoOk, I didn't know that. I thought it was just a shorthand for people in leadership positions with lots of expertise.
- 4ndrewl 1y agoI'm a "thought follower". Wherever my leaders tell me to go, I follow.
- roywiggins 1y agoHave bubbles ever been successfully called by thought leaders?
- hasperdi 1y agoYes. Say there are 10000 thought leaders with different thinkings. There's a chance that at least one is right.
- nabla9 1y agoDot-com bubble is a good analogy. Nvidia will be Cisco of this era. Cisco was the worlds most valuable company when dot-com bubble peaked, went down almost 90% in 2 years. There was lots of "dark fiber" all around (fiber optic cable already installed but not used). I think OpenAI and most small AI companies go down. Microsoft, Google, Meta scale down, write down losses but keep going and don't stop research. I hope AI bubble leaves behind massive amounts of cloud compute that companies are forced to sell at the price of the electricity and upkeep for years. New startups with new ideas can build upon it. Investors will feel poor, crypto market will crash and so on.
- NitpickLawyer 1y agoWhat a bad article. I mean how biased can you be, to put the first big quote from someone who wrote a book called "The AI con". Come on! This feels like the "deepseek r1 is the death of nvda" of 6 months ago. Someone is making a play, and whoever wrote this article fell for it. gpt5 has always been about making a "collection of models" work together and not about model++. This was announced what, a year ago? And they delivered. Capabilities ~90-110% of their top tier old models at 4-6x lower price. That's insane! gpt5-mini is insane for its price, in agentic coding. I've had great sessions with it, at 0.x$ / session. It can do things that claude 3.5/3.7 couldn't do ~6 months ago, at 10-15x the price. Whatever RL they did is working wonders.
- sapphicsnail 1y ago> What a bad article. I mean how biased can you be, to put the first big quote from someone who wrote a book called "The AI con". It's an op-ed. It's supposed to be biased.
- HDThoreaun 1y agoThis is my biggest issue with online newspapers. With print it is very clear if you are in the op-ed section. Online not so much
- Workaccount2 1y agoMedia orgs (well journalists really) are especially hostile towards AI and it's easy to see understand why.
- athenot 1y agoThis is an Opinion piece, not a news article. The distinction between the two seems to be lost on most people nowadays. One way I leverage opinion pieces for things with which I disagree, is to treat it as a sort of "devil's advocate". What argument are they making? Is that really the strongest one they have? Does my understanding of that domain effectively counter those arguments? etc. In this case, the main argumentation is on how ChatGPT is not the miraculous genie it was hyped up to be. That's a fair statement, but to extrapolate that into "AI bubble is crashing now" is overlooking a host of other facts about its usefulness. Yes we'll eventually hit the through of disillusionment but I don't think we're there yet.
- aydyn 1y agoA comment in a previous thread stuck with me said something like "AI is successful because nothing else interesting is happening". That rings true and I suspect the bubble won't burst until something else comes along to steal the show.
- r2_pilot 1y agoMeanwhile Claude is helping me build a robot and is also writing the code that runs its subsystems but okay. Sure, I could do it all myself(maybe?) but not nearly as quickly or in the interstitial moments of life.
- bogwog 1y agoSounds more like you're helping Claude build a robot.
- r2_pilot 1y agoI have more hands and a larger context window. It's a collab(/s). But it's cool that I can do it more or less solely with that tool and not necessarily use Google or other resources(obviously for any source, from Google to the Encyclopedia Britannica, one must evaluate the quality of the information).
- bogwog 1y agoWhat are you getting out of this though? Do you think this robot is going to have some kind of positive economic impact? Will you turn it into a business? Do you anticipate it will solve a personal need, like folding your laundry for you? Because a lot of people do robot projects in their free time to learn, but you're doing it without the learning part...so what's the point?
- r2_pilot 1y agoIt's a hack. Not everything has to have commercial value, not everything has to solve a need, there's no inherent purpose in anything, this is just how I choose to spend my time.
- TMWNN 1y agoInternet traffic kept growing throughout the dotcom bubble. That valuations got ahead of themselves didn't mean that there wasn't something real driving the hype. Even if AI valuations have a sharp correction, there will still be a great need—and demand—for compute.
- BoredPositron 1y agoThe only thing that crystalizes it that the guys in that one meeting were right... there is no moat. The author might be right but the problem will be oversupply.
- marcosdumay 1y agoHum... Does anybody expect the US government to reduce the money supply or distribute it? Or for the dollar to devalue enough that their money doesn't make much of a difference anymore? If the answer is "no" for all above, then you should expect some bubble to keep going. At most, they will change the bubble subject.
- geye1234 1y agoI have also concluded that it is more likely a bubble than not. Anyone looked at buying S&P sector-specific ETFs? For people who want to keep their portfolio spread as widely as possible, but are frightened by how tech-heavy the S&P index is, these seem a good option. But they all seem to have high costs (the first one I pulled up is 0.39%).
- ofrzeta 1y agoThe core thesis seems valid " AI bots seem intelligent, because they’ve achieved the ability to seem coherent in their use of language. But that’s different from cognition." As it happens LLMs work comparatively well with code. Is this because code does not refer (a lot) to the outside world and fits well to the workings of a statistical machine? In that case the LLMs output can also be be verified more easily by inspection through an expert, compiling, typechecking, linting and running. Although there might be hidden bugs that only show up later.
- anuramat 1y ago> large language models work comparatively well with (programming) languages what else would they be good at
- tim333 1y ago>perceptions of AI’s relentless march toward becoming more intelligent ... came to a screeching halt Aug. 7 Overstates things a bit. It seems unlikely OpenAI will release human level AI in the next year or two, but the march of AI improving goes on. Also re the AI Con book saying AI is a marketing term, I'm more inclined to go with Wikipedia and "a field of research in computer science". Though there is a bit of a dot com bubble feel to valuations.
- 1vuio0pswjnm7 1y ago"Indeed, as long ago as the 1960s, that phenomenon was noticed by Joseph Weizenbaum, the designer of the pioneering chatbot ELIZA, which replicated the responses of a psychotherapist so convincingly that even test subjects who knew they were conversing with a machine thought it displayed emotions and empathy. "What I had not realized," Weizenbaum wrote in 1976, "is that extremely short exposures to a relatively simple computer program could induce powerful delusional thinking in quite normal people." Weizenbaum warned that the "reckless anthropomorphization of the computer" - that is, treating it as some sort of thinking companion - produced a "simpleminded view of intelligence."" https://www.theguardian.com/technology/2023/jul/25/joseph-weizenbaum-inventor-eliza-chatbot-turned-against-artificial-intelligence-ai https://www.theguardian.com/technology/2023/jul/25/joseph-we... Weizenbaum's 1976 book: https://news.ycombinator.com/item?id=36875958 https://news.ycombinator.com/item?id=36875958 HN commenter rates this "greatest tech book of all-time": https://news.ycombinator.com/item?id=36592209 https://news.ycombinator.com/item?id=36592209
- joeyagreco 1y agoUsing how GPT-5 generates text within an image is a terrible way to test it. If you ask it to list all 50 states or all US presidents it does it no problem. Asking it to generate the text of the answer in an image is a piss poor way of testing a language model. I heavily dislike GPT-5 but at least have a fair review of it.
- wonderfuly 1y agoThis article tries to argue that the AI bubble has burst by pointing to the failed release of GPT-5. Admittedly, the release of GPT-5 was somewhat of a flop, but I think it's more of a failure in its launch rather than the model itself. In fact, if you use the GPT-5 Thinking model, it's actually quite good. They attempted to make the model automatically route to different levels of thinking intensity, but the routing didn't work very well, which led to the various bad cases people experienced.
- tim333 1y agoYeah Altman says "I think we totally screwed up some things on the rollout" https://fortune.com/2025/08/18/sam-altman-openai-chatgpt5-launch-data-centers-investments/ https://fortune.com/2025/08/18/sam-altman-openai-chatgpt5-la... also >ChatGPT is already the fifth biggest website in the world, according to Altman, and he plans for it to leapfrog Instagram and Facebook to become the third, though he acknowledged: “For ChatGPT to be bigger than Google, that’s really hard.” >“We have better models, and we just can’t offer them, because we don’t have the capacity,” he said. GPUs remain in short supply, limiting the company’s ability to scale. So Altman wants to keep building. Whether investors will pay up for that remains to be seen I guess.