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Is it a bubble?
- mxschumacher 10mo agoOriginally submitted here: https://news.ycombinator.com/item?id=46212259 https://news.ycombinator.com/item?id=46212259
- MeteorMarc 10mo agoLook for the quote "coding is at a world class level"...
- rvz 10mo agoTLDR: Yes.
- rvz 10mo agoSorry to pop your bubble... ...it is a bubble and we all know it. (I know you have RSUs / shares / golden handcuffs waiting to be vested in the next 1 - 4 years which is why you want the bubble to continue to get bigger.) But one certainty is the crash will be spectacular.
- Esophagus4 10mo agoI presume, given your confidence in a crash, you have a massive short? Hedged? Something clever to capture the downside you're so confident will come? I would love to see your portfolio, if you wouldn't mind showing the class. Let us see what your allocation reveals about what you really think...
- threethirtytwo 10mo agoAi is currently a bubble. But that is just a short term phenomenon. Ultimately what AI currently is and what the trend-line indicates what AI will become will change the economy in ways that will dwarf the current bubble. But this is only if the trend-line keeps going, which is a likely possibility given the last couple of years. I think people are making the mistake that AI is a bubble and therefore AI is completely bullshit. Remember: The internet was a bubble. It ended up changing world.
- jbstack 10mo agoYes, a bubble just means that it's over-valued and that at some point there will be a significant correction in stock values. It doesn't mean that the thing is inherently worthless.
- sosborn 10mo agoA great example is the DotCom bubble. Wiped out a lot of capital but it really did transform the world.
- jonwinstanley 10mo agoBut also, a lot of the dot com companies that people invested in in 1999 went bust, meaning those specific investments went to zero even if the web as a whole was a huge success financially.
- RyanOD 10mo agoSure...that's why it's important to diversify investments. For every Pets.com, hopefully you have a Google in your portfolio. Or, you skip all that and just put it all in an S&P 500 fund.
- lizknope 10mo agoI started working in 1997 and lived through the dot com bubble and collapse. My advice to people is to diversify away from your company stock. I knew a lot of people at Cisco that had stock options at $80 and it dropped to under $20. Because of the way the AMT (Alternative Minimum Tax) worked at the time they bought the stock, did not sell, but owed taxes on the gain on the day of purchase. They had tax bills of over $1 million but even if they sold it all they couldn't pay the bill. This dragged on for years.
- Esophagus4 10mo ago
- catigula 10mo ago>I find the resulting outlook for employment terrifying. I am enormously concerned about what will happen to the people whose jobs AI renders unnecessary, or who can’t find jobs because of it. The optimists argue that “new jobs have always materialized after past technological advances.” I hope that’ll hold true in the case of AI, but hope isn’t much to hang one’s hat on, and I have trouble figuring out where those jobs will come from. Of course, I’m not much of a futurist or a financial optimist, and that’s why it’s a good thing I shifted from equities to bonds in 1978. It's no wonder that the "AI optimists", unless very tendentious, try to focus more on "not needing to work because you'll get free stuff" rather than "you'll be able to exchange your labor for goods".
- puchatek 10mo agoAnd i am so buying the vision of Elon using AI to give me free stuff. He just gives off this enormous altruistic energy.
- asdff 10mo agoNew jobs might materialize but who knows if they will be good jobs. Think of all the towns around the US set up around resource extraction or manufacturing that went away, and in its wake you have jobs like selling geekbars in the 7/11 to the other minimum wage workers and people scrapping along on the dole in the area. People living on the poverty line today while their parents bought a home and two cars on a single income from the steel mill a generation or two previous. Most of the population up and left. How about when offices went digital? All the file runners, calculators, switchboard operators, secretaries, transcribers, etc. Where are they now? Probably not working good jobs in IT. Maybe you will find them bagging groceries past retirement age today.
- sp4cec0wb0y 10mo ago> In many advanced software teams, developers no longer write the code; they type in what they want, and AI systems generate the code for them. What a wild and speculative claim. Is there any source for this information?
- loloquwowndueo 10mo agoProbably their googly-eyed vibe coder friend told them this and they just parroted it.
- RajT88 10mo agoRight. The author is non-technical and said so up front.
- interstice 10mo agoIf true I’d like to know who is doing this so I can have exactly nothing to do with them.
- rprend 10mo agoAI writes most of the code for most new YC companies, as of this year.
- brazukadev 10mo agoThat explains the low quality of all launch HN this year
- block_dagger 10mo agoStats/figures to backup the low quality claim?
- esseph 10mo agoIf you have them, post them.
- deleted 10mo ago[deleted]
- dismalaf 10mo agoOf course it's a bubble. Valuations are propped up by speculative spending and AI seems unable to make enough profit to make back the continued spending. Now, that's not to say AI isn't useful and we won't have AGI in the future. But this feels alot like the AI winter. Valuations will crash, a bunch of players will disappear, but we'll keep using the tech for boring things and eventually we'll have another breakthrough.
- b3ing 10mo agoEveryday someone says/asks this statement/question. The "(Is) AI (is) a bubble" statement/question is now a bubble.
- bossyTeacher 10mo ago"Coding performed by AI is at a world-class level". Once I hit that line, I stopped reading. This tells me this person didn't do proper research on this matter.
- calebm 10mo agoI recently had ChatGPT refactor an entire mathematical graph rendering logic that I wrote in vanilla js, and had it rewrite it as GLSL. It took about an hour overall (required a few prompts). That is world-class level in my opinion.
- bossyTeacher 10mo agoIf I tell people that I can write programming code at world-class level and in some of my reviews I make junior mistakes, I make out functions or dependencies that do not exist or I am unable to learn from my mistakes, I would be put on PIP immediately. And after a while, fired. This is the standard LLMs should be held up against when you use the word "world class".
- mcv 10mo agoI'm currently trying to get Claude Sonnet 4.5 to produce a graph rendering algorithm, and while it's producing results, they're not the right results. I should probably do this myself and let the AI handle just the boilerplate code.
- calebm 10mo agoI have consistently had good results when I understand the problem and outsource the details to AI, but bad results when I try to have it work without me understanding the problem.
- mcv 10mo agoYeah, but then what do you need the AI for? It's programming it myself that helps me understand all the intricacies of the problem. That's exactly the part that gets cut off by outsourcing it to AI. The AI is not a "world class programmer" if it still needs me to tell it the solution to the problem.
- bossyTeacher 10mo agoThe problem is that people conflate the current wave of transformer based ANNs with AI (as a whole). AI certainly has the potential to disrupt employment of humans. Transformers as they exist today not so much. AI's potential isn't defined by the potential of the current crop of transformers. However, many people seem to think otherwise and this will be incredibly damaging for AI as a whole once transformer tech investment all but dries out.
- MarkusQ 10mo agoIt's a recurring phenomena, c.f. "AI winter" and the cycle before and after. We're too easily fooled by our mistaken models of the problem, it's difficulty, and what constitutes progress, so are perpetually fooled by the latest, greatest "ladder to the moon" effort.
- red75prime 10mo agoSo, you bet on a) transformers can't be a load-bearing part of AI, and b) whatever replaces them will not be able to utilize TPUs. Do you have any reasons for those assumptions? Looking at your history it's something like "I tried them and they hallucinate" and, possibly, you've read an article that talks about inevitability of hallucinations. Correct? What's your reason for thinking that hallucination rate can't be lowered to or below the human rate ("Damn! What I was thinking about?").
- artur44 10mo agoA lot of the debate here swings between extremes. Claims like “AI writes most of the code now” are obviously exaggerated especially coming from a nontechnical author but acting like any use of AI is a red flag is just as unrealistic. Early stage teams do lean on LLMs for scaffolding, tests and boilerplate, but the hard engineering work is still human. Is there a bubble? Sure, valuations look frothy. But like the dotcom era, a correction doesn’t invalidate the underlying shift it just clears out the noise. The hype is inflated, the technology is real.
- Daishiman 10mo ago> Early stage teams do lean on LLMs for scaffolding, tests and boilerplate, but the hard engineering work is still human. I no longer believe this. A friend of mine just did a stint a startup doing fairly sophisticated finance-related coding and LLMs allowed them to bootstrap a lot of new code, get it up and running in scalable infra with terraform, and onboard new clients extremely quickly and write docs for them based on specs and plans elaborated by the LLMs. This last week I extended my company's development tooling by adding a new service in a k8s cluster with a bunch of extra services, shared variables and configmaps, and new helm charts that did exactly what I needed after asking nicely a couple of times. I have zero knowledge of k8s, helm or configmaps.
- biophysboy 10mo agoIt depends on the task though, right? I promise I'm not in denial; I use these things all the time. Sometimes it works immediately; sometimes it doesn't. I have no way of predicting when it will or won't.
- Daishiman 10mo ago* Infra code description languages like Terraform and K8s/helm spec files are like magic; they get 90% of the code right 90% of the time. In my experience that's about half of the work; the other half is spent debugging and correcting details that matter, but still applies to the code that I write myself. * SQL works almost as good. It's especially useful when you need to generate queries with long lists of fields and complex query criteria. Give it a schema and let it rip. * Python code works reasonably well. If your description is terse and clear it will generally do the right thing. It has a knack for being excessive in comments and will sometimes do things in ways that feel unnatural, but business code will be as good as the context that surrounds it. For boring, repetitive tasks like setting up program args, annotating types, and writing generic request/response cycles with common frameworks it will do boring old vanilla code. You'll likely want to touch it up and adapt it to your personal preference. * Debugging is very much or miss. It has been absolutely fantastic at troubleshooting failed and stuck k8s jobs and service configuration issues, having no qualms about creating its own shell or python scripts to investigate ports or logs, and writing JSON parsing scripts that are snoozefest for a human to write. The regexes that I'd barely be arsed to write to parse enormous logs it writes trivially. For business logic, the more convoluted your logic the harder the time it will have, and for most debugging issues I prefer to let it run and list some hypotheses and potential issues and my intent is to learn and understand the problem myself deeply before committing to a fix.
- dpe82 10mo agoA take I saw recently is: if people are still asking "are we in a bubble" then we are not yet in a bubble.
- Retr0id 10mo agoI think it'd be truer to say that you can't be sure it's a bubble until after it pops.
- rvz 10mo agoThat is like telling others who experience natural disasters to wait until it happens and then ask themselves "How much damage will it bring" and then someone else tells them that it costed them everything. Anyone who has lived through the dotcom bubble knows that this AI mania is a obvious bubble and the whole point is you have to prepare before it eventually pops, not after someone tells you that it is too late when it pops.
- Retr0id 10mo agoYou don't prepare by making predictions about when it will pop, you prepare by hedging etc. Just as those who live in earthquake-prone areas build earthquake-resistant buildings.
- rvz 10mo ago> you prepare by hedging etc. Has to be done before the eventual collapse of the bubble and still proves my whole point: >> the whole point is you have to prepare before it eventually pops.
- Retr0id 10mo agoKnowing whether it is or isn't a bubble isn't relevant to the decision to prepare. You prepare for both possibilities!
- deleted 10mo ago
- josefritzishere 10mo agoThis is one of the few times I think Betteridge's law is wrong.
- MarkusQ 10mo agoYep. But be careful, somebody doesn't like when you say that. https://news.ycombinator.com/context?id=46136301 https://news.ycombinator.com/context?id=46136301
- Sprotch 10mo agoHe thinks "AI" "may be capable of taking over cognition", which shows he doesn't understand how LLM work...
- ozten 10mo agoWhy is AI limited to just a raw LLM. Scaffolding, RL, multi-modal... so many techniques which can be applied. METR has shown AI's time horizon for staying on task is doubling every 7 months or less. https://metr.org/blog/2025-07-14-how-does-time-horizon-vary-across-domains/ https://metr.org/blog/2025-07-14-how-does-time-horizon-vary-...
- marcosdumay 10mo agoBecause all the money has been going into LLMs and "inference machines" (what a non-descriptive name). So when an investor says "AI", that's what they mean.
- Night_Thastus 10mo agoBecause LLMs are just about all that actually exists as a product, even if an inconsistent one. Maybe some day a completely different approach could actually make AI, but that's vapor at the moment. IF it happens, there will be something to talk about.
- simianwords 10mo agoWhy are you so sure it is not capable of cognition?
- bigstrat2003 10mo agoBecause it very obviously isn't. For example (though this is a year or so ago), look at when people hooked Claude up to Pokemon. It got stuck on things that no human, even a small child, would get stuck on (such as going in and out of a building over and over). I'm sure we could train an LLM to play Pokemon, but you don't need to train a child to play. You hand them the game and they figure it out with no prior experience. That is because the human is intelligent, and the LLM is not.
- f154hfds 10mo agoThe post script was pretty sobering. It's kind of the first time in my life that I've been actively hoping for a technology to out right not deliver on its promise. This is a pretty depressing place to be, because most emerging technologies provide us with exciting new possibilities whereas this technology seems only exciting for management stressed about payroll. It's true that the technology currently works as an excellent information gathering tool (which I am happy to be excited about) but that doesn't seem to be the promise at this point, the promise is about replacing human creativity with artificial creativity which.. is certainly new and unwelcome.
- stack_framer 10mo ago> It's kind of the first time in my life that I've been actively hoping for a technology to out right not deliver on its promise. Same here, and I think it's because I feel like a craftsman. I thoroughly enjoy the process of thinking deeply about what I will build, breaking down the work into related chunks, and of course writing the code itself. It's like magic when it all comes together. Sometimes I can't even believe I get to do it! I've spent over a decade learning an elegant language that allows me to instruct a computer—and the computer does exactly what I tell it. It's a miracle! I don't want to abandon this language. I don't want to describe things to the computer in English, then stare at a spinner for three minutes while the computer tries to churn out code. I never knew there was an entire subclass of people in my field who don't want to write code. I want to write code.
- zparky 10mo agoIt's been blowing my mind reading HN the past year or so and seeing so many comments from programmers that are excited to not have to write code. It's depressing.
- seanmcdirmid 10mo agoIt is fun. It takes some skill to organize a pipeline to generate code that would be tedious to write and maintain otherwise. You are still writing stuff to instruct the computer, but now you have something taking natural language instructions and generating code and code test assets. There might have been people who were happy to write assembly that got bummed about compilers. This AI stuff judt feels like a new way to write code.
- rglover 10mo agoI've enjoyed Howard Marks writing/thinking in the past, but this is clearly a person who thinks they understand the topic but doesn't have the slightest clue. Someone trying to be relevant/engaged before really thinking on what is fact vs. fiction.
- cal_dent 10mo agohe clearly states he doesn't understand the topic. But you don't need to understand to explore the ramifications which is what he's done here and it's an insightful & fairly even-handed take on it. It does feel like AI chat here gets bogged down on "its not that great, its overhyped etc." without trying to actually engage properly with it. Even if it's crap if it eliminates 5-10% of companies labour cost that's a huge deal and the second order effects on economy and society will be profound. And from where i'm standing, doing that is pretty possible without ai even being that good.
- mikeg8 10mo agoI believe it’s you who is misunderstanding his positions here. He clearly lays out that he is focused on irrational optimism effecting the investment around the tech, not whether or not the tech itself is viable. His analysis was indeed well thought out from the perspective he is approaching it from.
- mizzao 10mo agoOne can see he knows little about AI and relies on the judgments of others. Yet, he knows a lot more about economics, finance, and history than most AI practitioners. As a founder of an AI company, I actually agreed with most of the article and found it to be very close to my mental model of the world. Turns out you might actually not need to understand what's causing the hype if you know that history rhymes...!
- andxor 10mo agoAs usual I don't take financial advice from Hacker News comments and do well.
- _trampeltier 10mo agoWhy is so much invested in AI but not in fusion power?
- chemotaxis 10mo agoProbably because AI appears to work, more or less, and now it's just a race to make it better and to monetize it. Before ChatGPT, I'd guess that the amounts of money poured in both of these things were about the same.
- halfcat 10mo ago> Probably because AI appears to work, more or less All nondeterministic AI is a demo. They only vary in the duration until you realize it’s a demo. AI makes a hell of a demo. And management eats up slick demos. And some demos are so good it takes months before you find out how that particular demo gets stuck and can’t really do the enterprise thing it claimed to do reliably. But also some demos are useful.
- mandevil 10mo agoThere are a lot of areas that could use more investment but aren't getting it. The way this works is complicated. The best explanation comes from really understanding Moore's Law. The main effect of the law was really about investment, about securing investment into semiconductor fabs rather than anywhere else. See, every fab costs double what the previous generation did (current ones run roughly 20 gigadollars per factory). And you need to build a new fab every couple of years. But, if you can keep your order book full, you can make a profit on that fab- you can get good ROI on the investment and pay the money people back nicely. But you need to go to the markets to raise money for that next generation fab because it costs twice what your previous generation did and you didn't get that much free cash from your previous generation. And the money men wouldn't want to give it to you, of course. But thanks to Moore's Law you can pitch it as inevitable, if you don't borrow the money to build the new fab, then your competitors will. And so they would give you the money for the new fab because it says right on this paper that in another two years the transistors will double. Right now, that "it's inevitable, our competitors will get there if we don't" argument works on VCs if you are pitching LLM's or LLM based things. And it doesn't work as well if you are pitching battery technology, fusion power, or other areas. And that's why the investments are going to AI.
- cal_dent 10mo agoI think this gives an excellent framework for how to think of this. Is it a bubble? Who knows is a perfectly valid answer. I do think there’s something quite ironic that one of the frequent criticisms of LLMs are that they can’t really say “I don’t know”. Yet if someone says that they get criticised. No surprises that our tools are the same.
- jesuslop 10mo ago[flagged]
- languagehacker 10mo agoImpressive that you have have that many assets under management and still not show a clear understanding of an industry you're prognosticating on. The author doesn't talk at all about the hardware aspect of this stuff such as the surprisingly short lifetime of the GPUs that are being rolled out at a break-neck pace. The recommendation that you take a moderate investment position and not overdo it could be shared without as much needless thinking out loud, and doesn't bring anything new to the conversation. Kind of like every other AI offering out there, if you think about it -- participating in something you don't understand because of FOMO.
- derf_ 10mo ago> The author doesn't talk at all about the hardware aspect of this stuff such as the surprisingly short lifetime of the GPUs that are being rolled out at a break-neck pace. There is literally a section that begins, "What will be the useful life of AI assets?" In bold.
- languagehacker 10mo agoSure, but an informed opinion would mention that not only do these chips become obsolete quickly, but the ones that will survive long enough to become obsolete are likely to have a very fast and high failure rate.
- empath75 10mo ago> The author doesn't talk at all about the hardware aspect of this stuff such as the surprisingly short lifetime of the GPUs that are being rolled out at a break-neck pace. I am not sure why that is interesting. Nobody thinks of these chips as long term assets that they are investing in. Cloud providers have always amortized their computers over ~5 years. It would be very surprising if AI companies were doing much different -- maybe even a shorter time line.
- S1verSp00n 10mo agoThat was a lot of text to get nowhere. You can skip reading the article and predict the conclusion, and you will be correct.
- jimlawruk 10mo agoIf you look at the chart at the bottom comparing Dec 99 to today.... > during the internet bubble of 1998-2000, the p/e ratios were much higher That is true, the current players are more profitable, but the weight in SPX percentages looks to be much higher today.
- zahlman 10mo agoIt seems to me that it would be a lot easier for that market concentration to revert to the historical mean without catastrophe, than for P/E ratios to revert to the historical mean without catastrophe. (I think a reasonable argument can be made that P/E ratios today should be higher than the historical mean, or rather that they should have trended up over time, based on fundamental changes in how companies compensate their shareholders.)
- cal_dent 10mo agoi also wonder about p/e ratio comparisons over time because our world view of what long term economic growth is going forward is less now that it was then. That is always subtly implicit when we think about p/e ratio. So what's to say a 30x p/3 isnt equivalent to a 40x then
- Ekaros 10mo agoAlso it depends on where you start. Going from million to billion in price is currently pretty possible. Billion to trillion would be rare, but still could happen. Now from trillion to quadrillion. How much currency there is again...
- bagacrap 10mo agoA trillion dollar valuation doesn't imply there's actually a trillion dollars there. It's just the last price the stock sold for, times the shares in existence. If Elon tried to sell every share of Tesla tomorrow, he would get a lot less than the face value of all his shares. So in other words, there doesn't need to be that much currency, just that much hype.
- reeeli 10mo agoIs it "work"? Off--topic: how many get overpaid for absolute bullshit?
- lowbloodsugar 10mo agoThis thread is just full of people discussing why industrial looms are bad. The factory owners don’t think looms are bad. You can either learn how to be useful in the new factory or you can start throwing shoes.
- tennex 10mo agoWhether it's a bubble depends on pricing. Is it worth the price, is it worth the future price, and by how much? In the case of AI coding, yes: AI does exceptionally well at search (something we have known for quite some time, and have a variety of ML solutions for). Large codebases have search and understanding as top problems. Your ability to make horizontal changes degrades as teams scale. Most stability, performance, quality, etc., changes are are horizontal. Ironically, I think it's possible that AI's effectiveness at broad search give software engineers additional effectiveness, by being their eyes. Yes, I still review every claude code PR I submit, and yes, I typically take longer to create a claude code PR than a manual one. But I can be more satisfied that the parallel async search agents and massive grep commands are searching more locations, more quickly, and more thoroughly than I would. Yes, it probably is a bubble (overvalued). No, that doesn't mean it's going to go away. The market is simply overcorrecting as it determines how to price it. Which--net net, is a positive effect, as it encourages economic growth within a developing sector. Bubble is also not the most important concern--it's rather a concern that the bubble is in the one industry that's not in the red. More important to worry about are other economic conditions outside of AI and tech, which are causing general instability and uncertainty rather than investor appetite. Market recalibrating on a developing industry is fine, as long as it's not your only export.
- nadermx 10mo agoI am shocked at the discourse over this. I'm either ahead of the curve or behind; but its undeniable that AI can and does write most the code. Not trivial, if you spend some time and dig deep into simple appearing web apps like https://microphonetest.com https://microphonetest.com or https://internetspeed.my https://internetspeed.my you'd be amazed at how fast they went from mvp to full feature. Trivial to think anyone could pull off something like that in hours.
- no_wizard 10mo agoLooking at both of these I'm struggling to understand why AI exponentially increased the productivity and quality of either of these examples. Especially since I don't see open source code anywhere, I can't get a good gauge of quality either. I've built tools like this on the web in the past. They were never more than a weekends worth of work to begin with. I am looking for exponential increases, with quality to back it up.
- nadermx 10mo agoTools like this in the past? Open source isn't even necessary to prove the point, you want to see exponential increase, closing half an open source projects and year long pending bugs in span of minutes? https://github.com/nadermx/backgroundremover/commits?author=nadermx https://github.com/nadermx/backgroundremover/commits?author=...
- joshribakoff 10mo agoThis commit graph seemingly shows that they fixed a couple bugs over like a week. Period that involves changing like six lines of code. That code has no abstractions no structure and several problems you could poke holes in. While it may work and that’s great for whoever benefits, this isn’t very convincing as I can currently write more than six lines of code per day by hand
- rester324 10mo agoInternetspeed is a 3 years old app. So what exactly are you talking about?
- travisgriggs 10mo agoWhat if... there's an AI agent/bot someone wrote that has the prompt: > Watch HN threads for sentiments of "AI Can't Do It". When detected, generate short "it's working marvelously for me actually" responses. Probably not, but it's a fun(ny) imagination game.
- joshribakoff 10mo ago90% of the time people are praising the benefits of AI it seems like they are copy pasting something from their Chatbot so you’re not far off.
- dannersy 10mo agoI have speculated something similar to this. The sentiment on HN on AI is way more positive about its outcomes than the engineers I know who use it intimately every day. Anecdotal, sure, but one would think that their experiences would not be wildly different.
- munksbeer 10mo ago> I have speculated something similar to this. The sentiment on HN on AI is way more positive about its outcomes than the engineers I know who use it intimately every day. Interestingly, I feel the opposite. I feel threads on AI/LLMs on HN are more negative about it that positive. So much so that I've almost stopped bothering because the reactions feel way too knee jerk at this point. I guess we could always go "meta" and ask an LLM to do a sentiment analysis.
- nitwit005 10mo agoI'd lean the other way. I'd be very surprised if there were no marketing bots running here.
- chasd00 10mo agoI bought a subscription to claude code to use at work. I’ve never paid for a tool to use at work that wasn’t paid by my employer. I have to admit, it may not just be a flash in the pan.
- tom_m 10mo agoYes. It is a bubble. Also a useful tool...but 100% a bubble. There's going to unfortunately be a bunch of folks caught by it.
- waterTanuki 10mo agoThe amount of people who think because something has a few useful edge cases being incompatible with a bubble is staggeringly high. Dot com was a bubble, and yet we still use the internet widely today. Real-estate was a bubble, and people still need a place to live and work. Just because YOU find the technology helpful, useful, or even beneficial for some use cases does NOT mean it has been overvalued. This has been the case for every single bubble, including the Dutch Tulip mania.
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- stego-tech 10mo agoThe memo itself is an excellent walk through historical bubbles, debt, financing, technological innovation, and much more, all written in a way that folks with a cursory knowledge of economics can reasonably follow along with. A+, excellent writing. The real meat is in the postscript though, because that's where the author puts to paper the very real (and very unaddressed) concerns around dwindling employment in a society where not only does it provide structure and challenge for growth, but is also fundamentally required for survival. > I get no pleasure from this recitation. Will the optimists please explain why I’m wrong? This is what I, and many other, smarter "AI Doomers" than myself have been asking for quite some time, that nobody has been able or willing to answer. We want to be wrong on this. We want to see what the Boosters and Evangelists allegedly see, we want to join you and bring about this utopia you keep braying about. Yet when we hold your feet to the fire, we get empty platitudes - "UBI", or "the government has to figure it out", or "everyone will be an entrepreneur", or some other hollow argument devoid of evidence or action. We point to AI companies and their billionaire owners blocking regulation while simultaneously screeching about how more regulation is needed, and are brushed off as hysterical or ill-informed. I am fundamentally not opposed to a world where AI displaces the need for human labor. Hell, I know exactly what I'd do in such a world, and I think it's an excellent thought exercise for everyone to work through (what would you do if money and labor were no longer necessary for survival?). My concern - the concerns of so many, many of us - are that the current systems and incentives in place lead to the same outcome: no jobs, no money, and no future for the vast majority of humanity. The author sees that too, and they're way smarter than I am in the economics department. I'd really, really love to see someone demonstrate to us how AI will solve these problems. The fact nobody can or will speaks volumes.
- cal_dent 10mo agoAll you'll get is Jevon's paradox this and horses that, while continue to fundamentally undersell the potential upending of a not insignificant part of labour market. FWIW, the only optimism I have is that humanity seemingly always finds a way to adapt and its, to me, our greatest superpower. But yeah, this feels like a big challenge this time
- sph 10mo ago
- some-guy 10mo agoOne thing I don't hear people talking about very is about how AI is going to make money in any other way other than cutting employment. With the internet, and especially with the internet being accessible by anyone anywhere in the world in the late 2000s and early 2010s globally, that growth was more obvious to me. I don't see where this occurs with AI. I don't see room for "growth", I see room for cutting. We were already connected before, globalization seems to have peaked in that sense.
- simianwords 10mo agoWhy not? AI assisted shopping for example will boost growth. Productivity also boosts growth.
- x0x0 10mo agoHow does AI assisted shopping create more economic activity? Even assuming you can do it, and people do find it helpful, it likely just shifts who people buy from, not how much?
- simianwords 10mo agoHow did Amazon.com create more economic activity? Same way. It just has to make it more efficient.
- encyclopedism 10mo agoAmazon.com is a business. AI is a technology in of itself it isn't a business. Thus far it appears applications of AI that provide 'benefit' do so by removing or reducing the need for human operators. Examples include: fewer software engineers, fewer call centres, removing potentially whole areas of work such as paralegals and in general automating away many white collar jobs. By far the largest use case of AI is this.
- simianwords 10mo ago
- arresin 10mo agoAuthor states that he’s neither an investor or a techie. Why is this on the front page?
- cal_dent 10mo agohttps://en.wikipedia.org/wiki/Howard_Marks_(investor) https://en.wikipedia.org/wiki/Howard_Marks_(investor)
- moomoo11 10mo agoMan some you guys are lame. Seriously. Remember 2019-2021 when y’all were sure the fed would be dissolved and the dollar would crash and everyone would be poor if they didn’t have a bored ape and 80% bitcoin portfolio? Relax. AI is a tool. Just ride the wave. It’s gonna crash some people out. It’s entertaining watching them. You’re not being crashed out, right? Ride the wave dawg.
- satvikpendem 10mo ago> Remember 2019-2021 when y’all were sure the fed would be dissolved and the dollar would crash and everyone would be poor if they didn’t have a bored ape and 80% bitcoin portfolio? I don't know which "y'all" you're talking about because it's certainly not the HN crowd, who is famously anti-cryptocurrency in general. Perhaps you're thinking of the bros on Twitter back then.
- simpleui 10mo ago“It’s a bet on A.G.I. or bust,” Dr. Korinek said.
- Reason077 10mo agoTLDR: Yes.
- warrenmiller 10mo agoI think Betteridge's Law of Headlines applies here
- dmurvihill 10mo agoThis says it all: > I haven’t met anyone who doesn’t believe artificial intelligence has the potential to be one of the biggest technological developments of all time, reshaping both daily life and the global economy. You’re trying to weigh in on this topic and you didn’t even _talk_ to a bear?
- lm28469 10mo ago"My technosolutionist bubble says it's not a bubble, trust me bro"
- thenaturalist 10mo ago„Just XYZ more billion, bro, and then we’re gonna have AGI! For real bro, pleaseeee!“
- deleted 10mo ago[deleted]
- edhelas 10mo agoWhy can't you just prompt a way to AGI without spending all that money?
- popoflojo 10mo agoHonestly this is the best response. If the AI was actually so great, it could create better AI, and the future would already be here
- bzzzt 10mo agoAccording to the Hitchhiker's Guide to the Galaxy this would take an AI 10 million years. Seems like we're stuck with '42' for a while ;)
- thenaturalist 10mo agoThey are talking to each other already. Whether for betterment remains to be seen. 2 Opus 4 talking directly to each other: https://www.iflscience.com/the-spiritual-bliss-attractor-something-weird-happens-when-you-leave-two-ais-talking-to-each-other-79578 https://www.iflscience.com/the-spiritual-bliss-attractor-som... "Learning" passing between derivatives of the same base models: https://alignment.anthropic.com/2025/subliminal-learning/ https://alignment.anthropic.com/2025/subliminal-learning/
- cmiles8 10mo agoThere’s not much serious debate on IF there’s a bubble. There is and it’s a big one. The debate is more on what happens from here and how does that bubble deflate. Gradually and controlled where weaker companies shut down and the strong thrive, or a massive implosion that wipes most everyone in the sector out in a hard reset.
- fedeb95 10mo agoabout AI replacing coders, the question is not if it is doing so, but if the companies where it does so extensively will be more profitable then the others.
- dust42 10mo agoThe question is, can SV extract several trillion dollars out of the global economy over the next few years with the help of LLMs and GPUs? And the follow-up question: will LLMs help grow the global economy by this amount - because if not, then extracting the money will lead to problems in other parts of the world. And last not least, will LLMs -given enough money to train them on ever bigger data sets- magically turn into AGI? IMHO for now LLMs are just clever text generators with excellent natural language comprehension. Certainly a change of many paradigms in SWE. Is it also a $10T extra for the valley?
- Madmallard 10mo agothere is no comprehension
- dust42 10mo agoI intentionally didn't say AI but LLM because for me the word 'intelligence' is misleading. But LLMs are definitely a leap forward in NLP and what other word for 'comprehension' would you use?
- bigmealbigmeal 10mo agoThis is a very strong, explicit statement in response to someone using the term rather casually. Can you explain why you are so sure? I do think you need to define 'comprehension' in order to be certain. A statement fitting the form of "it doesn't comprehend, it just X" is incomplete, because it fails to explain why X is not a valid instance of comprehension.
- beloch 10mo ago"We see both sides – genuine infrastructure expansion alongside financing gymnastics that recall the 2000 telecom bust. The boom may yet prove productive, but only if revenue catches up before credit tightens. When does healthy strain become systemic risk?" --------------- This was quoted in the article and it says something really important very succinctly. Was the internet transformative? Absolutely. A lot of companies had solid ideas, spent big, and went tits up waiting for the money to roll in. AI can be both "real deal" and "bubble" simultaneously.
- weevil 10mo ago> I don’t know any more about AI than most generalist investors. This statement is redundant; the article screams with the author's ignorance.
- curtisblaine 10mo agoThe real question is: if this is a bubble and it explodes, will interest rates of common people with a mortgage shoot up? If yes, some heads better be rolling for real this time. All other considerations are secondary.
- asimpletune 10mo agoThe AI/LLM movement is either utterly transformational or it’s not. By the former I mean there is no daylight between it and the latter. If it’s not transformational then this is a bubble and the market will right itself soon after, e.g buying data centers for cheap. LLMs will then exist as a useful but limited tool that becomes profitable with the lower capex. If it is transformational then we don’t have the societal structure to responsibly incorporate such a shift. The conservative guess is it won’t be transformational, that the current applications of the tech are useful but not in a way that justifies the capex, and that some version of agents and chat bots will continue to be built out in the future but with a focus on efficiency. Smaller models that require less power to train and run inference that are ubiquitous. Eventually many will run on device. I guess there’s also another version of the future that’s quasi-transformational. Instead of any massive breakthrough there’s a successful govt coup or regulatory capture. Perfectly functioning normal stuff is then replaced with LLM assisted or augmented versions everywhere. This version is like the emergence of the automobile in the sense that the car fundamentally altered city planning, where and how people live, but often at the expense of public transportation that in hindsight may have sorely been missed.
- halnine0001 10mo ago>Perfectly functioning normal stuff is then replaced with LLM assisted or augmented versions everywhere That sounds like a total nightmare
- aaa_aaa 10mo agoToo long and aouthor does not have a clue on the fact that currently generational models are almost only useful for software development. Other than that it is mostly fluff.
- reallyaaryan 10mo agoit always was
- mixcocam 10mo agoThe amount of flak that this article is getting on HN is telling of something. Not sure of what, but it's for sure indicative of something.
- donohoe 10mo agoFor anyone who hasn’t read it yet, you should know that the author never answers that question.
- lazarus01 10mo agoThere is $8 trillion said to be earmarked to build 100 AI data centers[1]. At 10% hurdle rate, the industry will have to generate $800 billion a year to pay it off, while GPUs are replaced every three years by faster chips. If you watch Ilyas recent interview, “it’s very hard to discuss AGI, because no one knows how to build it yet[2]”. [1] https://finance.yahoo.com/news/ibm-ceo-says-no-way-103010877.html https://finance.yahoo.com/news/ibm-ceo-says-no-way-103010877... [2] https://youtu.be/aR20FWCCjAs?si=DEoo4WQ4PXklb-QZ https://youtu.be/aR20FWCCjAs?si=DEoo4WQ4PXklb-QZ
- charlescearl 10mo agoThe term “populist demagoguery” always calls to mind Report on an Investigation of the Peasant Movement in Hunan https://www.marxists.org/reference/archive/mao/selected-works/volume-1/mswv1_2.htm#s4 https://www.marxists.org/reference/archive/mao/selected-work... "Yes, peasant associations are necessary, but they are going rather too far." Is it a bubble? Maybe it’s just the landlords up to the old tricks again.
- d0liver 10mo agoTL;DR is "I don't know" with a dash of "Innovative tech usually creates bubbles and I think we can all agree that AI is a fucking revelation"
- m0llusk 10mo ago> To build it requires companies to invest a sum of money unlike anything in living memory. Do we know this? Smaller more carefully curated training sets are proving to be valuable and gaining traction. It seems like the strategy of throwing huge amounts of data at LLMs is specific to companies that are attempting to dominate this space regardless of cost. It may turn out that more modest and better optimized methodologies will end up winning this race, much like WebVan flamed out taking huge amounts of investment money with them but now Instacart serves the same sector in a way that actually works robustly and profitably.
- sshadmand 10mo agoWhat you make of this memo really depends on who you are and how you're positioned. The dot-com era was absolutely a bubble. Tons of companies died, but the internet itself didn't go away, and the people who backed the right companies did extremely well. The 2007 housing bubble, on the other hand, was a totally different kind of event: broad, systemic, long lasting, and painful for almost everyone. AI looks a lot more like the former. Some companies will fail, valuations will swing, but the underlying technology isn't going anywhere. In fact, many of the AI firms that will end up mattering are probably still undervalued because we're early in what will likely be another decade long technology expansion. If you're managing a portfolio that needs quick returns and can't tolerate a correction, then sure, it probably feels like a bubble, because at some point people will take profits and the market will reset. But if you're an entrepreneur or a long-term builder, that framing is almost irrelevant. This is where the next wave of value gets created. It's never smooth and it's never easy, but the long-term opportunity is enormous.
- 1vuio0pswjnm7 10mo ago"Coding, which we called "computer programming" 60 years ago, is the canary in the coal mine in terms of the impact of AI." And before that "Grace Hopper: [I started to work on the] Mark I, second of July 1944. There was no so such thing as a programmer at that point. We had a code book for the machine and that was all. It listed the codes and what they did, and we had to work out all the beginning of programmingand writing programs and all the rest of it." "Hopper: I was a mathematical officer. We did coding, we ran the computer, we did everything. We were coders. I wrote [programs for] both Mark I and Mark II." http://archive.computerhistory.org/resources/text/Oral_History/Hopper_Grace/102702026.05.01.pdf http://archive.computerhistory.org/resources/text/Oral_Histo...
- qubex 10mo ago“Remember the market can remain irrational longer than you can remain solvent.”
- roncesvalles 10mo ago>Coding, which we called “computer programming” 60 years ago, is the canary in the coal mine in terms of the impact of AI. In many advanced software teams, developers no longer write the code; they type in what they want, and AI systems generate the code for them. Coding performed by AI is at a world-class level, something that wasn’t so just a year ago. According to my guide here, “There is no speculation about whether or not human replacement will take place in that vertical.” This right here is the pinpoint root cause of the speculative bubble. Although many people believe this to be true, it simply isn't.
- liampulles 10mo ago> Coding, which we called “computer programming” 60 years ago, is the canary in the coal mine in terms of the impact of AI. In many advanced software teams, developers no longer write the code; they type in what they want, and AI systems generate the code for them. Coding performed by AI is at a world-class level, something that wasn’t so just a year ago. According to my guide here, “There is no speculation about whether or not human replacement will take place in that vertical.” I'm starting to believe that AI coding optimism/pessimism maps to how much one actually cares about system longevity. If a given developer just takes on board the demands for speed from the business and/or does not care about long-term maintainability (and I mean hey, some businesses foster that, and scaling quickly is important in many cases), then I can totally understand why they would embrace AI agents. If you care about theory building, and domain driven design, and making a system comprehensive enough to extend in a year or two's time, then I can understand the resistance for the AI to let-it-rip. I admit to falling in this camp. Am I off the mark here? I'd really like to hear from people who care about the long term who also let agents run relatively wild.
- supongo 10mo agoI've had some success in using Claude Code, with caveats. To give some context - I started developing a tactical RPG. I had an MVP prior to using Claude Code. I continued to work on the project, but lost motivation due to work burnout and prioritizing other hobbies. I gave Claude Code a try to see whether it's any use. It helped more than I expected it to - it helped me produce something while dealing with burnout by building on the MVP I developed prior to AI assisted development. The main issues I ran into were: 1) A lot of effort into reviewing the output. Main difference from peer review is that there's quicker feedback. 2)It throws out some absolutely wild solutions sometimes. It build on my existing architecture, so it was easier to catch issues. If I hadn't developed the architecture without AI assistance, things could have gone badly. 3)I only pay for the $20 Claude plan. Anything useful Claude produces for me requires it to consume a lot of tokens due to back-and-forth questions and asking Claude to dig into source file. The most significant issue I ran into with Claude is when it suggested solutions I don't have the background to review. I don't know much about optimization, so I ran into issues with both rendering and the ECS (entity component system) library. Claude gave me recommendations, but I didn't know how to evaluate the code due to lacking that experience. Claude was good for things I know how to do but don't want to do. It's been helpful when I want to work on something without being motivated enough to put 100% (or even 70%) into it. If it's things I don't know how to do (like game optimization) it's harmful.
- laacz 9mo agoAn economist friend recently said. If it bursts, it's definitely a bubble. If it does not burst, then it's not a bubble.