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The question is not "is it a bubble". Bubbles are a desirable feature of the American experiment. The question is "will this bubble lay the foundation for growt

The question is not "is it a bubble". Bubbles are a desirable feature of the American experiment. The question is "will this bubble lay the foundation for growth and destroy some value when it pops, or will it only destroy value" https://www.oaktreecapital.com/insights/memo/is-it-a-bubble https://www.oaktreecapital.com/insights/memo/is-it-a-bubble

toomuchtodo 8mo ago
What can we use fields of GPUs for next?
- greenchair 8mo ago
  cloud gaming?
- dragontamer 8mo ago
  We can use the GPUs for research (64-bit scientific compute), 3d graphics, a few other things. We programmers will reconfigure them to something useful. At least, the GPUs that are currently plugged in. A lot of this bullshit bubble crap is because most of those GPUs (and RAM) is sitting unplugged in a warehouse, because we don't even have enough power to turn all of them on. So if your question is how to use a GPU... I got plenty of useful non-AI related ideas. But only if we can plug them in. I wouldn't be surprised if many of those GPUs are just e-waste, never to turn on due to lack of power.
  - cogman10 8mo ago
    > I wouldn't be surprised if many of those GPUs are just e-waste, never to turn on due to lack of power. That's my fear. The problem is these GPUs are specifically made for datacenters, So it's not like your average consumer is going to grab one to put into their gaming PCs. I also worry about what the pop ends up doing to consumer electronics. We'll have a bunch of manufacturers that have a bunch of capacity that they can no longer use to create products which people want to buy and a huge backstop of second hand goods that these liquidated AI companies will want to unload. That will put chip manufactures in a place where they'll need to get their money primarily from consumers if they want to stay in business. That's not the business model that they've operated on up until this point. We are looking at a situation where we have a bunch of oil derricks ready to pump, but shut off because it's too expensive to run the equipment making it not worth the energy.
    - dragontamer 8mo ago
      That's fine. Server is where we programmers are best at repurposing things. Just a bunch of always on boxes doing random crap in the background. Servers can (and do!!) use 10+ year old hardware. Consumers are kind of the weird the ones who are so impatient they need the latest and greatest.
  - themafia 8mo ago
    The government is going to use them. The flock cameras are going to be fed into them. The bitcoin network will be crashed. A technological arms race just occurred in front of your eyes for the past 5 years and you think they're going to let the stockpile fall into civilian hands?
    - dragontamer 8mo ago
      In 2 years the next generation chips will be released and th se chips will be obsolete. That's truly e-waste. Now in practice, we programmers find uses of 10+ year old hardware as cheap webhosta, compiler/build boxes, Bamboo, unit tests, fuzzers and whatever. So as long as we can turn them on we programmers can and will find a use. But because we are power constrained, when the more efficient 1.8nm or 1.5nm chips get released (and when those chips use 30% or less power), no one will give a shit about the obsolete stockpile.
      - zozbot234 8mo ago
        I assume even really out of date cards and racks will readily find some use, when the present-day alternative costs ~$100k for a single card. Just have to run them on a low-enough basis that power use is not a significant portion of the overall cost of ownership.
      - themafia 8mo ago
        > will be obsolete. In what sense? Not competitive for chat bot providers to use? Is that a metric that matters? > when the more efficient 1.8nm or 1.5nm chips get released What if they don't get released? You don't have a broad and competitive set of players providing products in this realm. How hard would it be to stop this? > no one will give a shit about the obsolete stockpile. You have lived your life with ready access to cutting edge resources. You ever wonder how long that trend could _possibly_ last?
        dragontamer 8mo ago
        As in: the 1.5nm or 1.8nm GPUs will use less power and therefore can actually be plugged in. We are power constrained. The GPUs of this generation can't even be plugged in yet because of these power constraints. When power is a problem, getting lower power GPUs in is a priority. The 1.8nm and 1.5nm next generation is already in production, and will likely launch before these massive GPU stockpiles are used. And then what? Why plug in last generations crap when the next generation is shipping? -------- Todays GPUs have to actually launch and be deployed while they are useful. Otherwise they could fully be obsolete and lose significant value.
  - jdiez17 8mo ago
    I predict there's going to be a niche opening up for companies to recycle the expensive parts of all these compute hardware that AI companies are currently buying and will probably be obsolete/depreciated/replaced in the next 2-5 years. The easiest example is RAM chips. There will be people desoldering those ICs and putting them on DDR5 sticks to resell to the general consumer market.
  - throwaway0123_5 8mo ago
    > 3d graphics Seems like the G in GPU is very obsolete now: https://www.tomshardware.com/news/nvidia-h100-benchmarkedin-games https://www.tomshardware.com/news/nvidia-h100-benchmarkedin-... > As it turns out Nvidia's H100, a card that costs over $30,000 performs worse than integrated GPUs in such benchmarks as 3DMark and Red Dead Redemption 2
  - bee_rider 8mo ago
    It’ll be interesting to see what people come up with to get conventional scientific computing workloads to work on 16 bit or smaller data types. I think there’s some hope but it will require work.
  - saati 8mo ago
    These AI optimized GPUs are criminally bad at 64bit, so no you won't use them for that.
- irishcoffee 8mo ago
  It’s too bad they’re all concentrated in buildings, having been hovered up by the billionaire class. I would love to live in the world where everyone joins a pool for inference or training, and as such gets the open source weights and models for free. We could call it: FOSS
- mike_hearn 8mo ago
  AI, obviously! A bubble doesn't mean demand vanishes overnight. There is - at current price points - much more demand than supply. That means the market can tolerate price hikes whilst keeping the accelerators busy. It seems likely that we're still just at the start of AI demand as most companies are still finding their feet with it, lots of devs still aren't using it at all, lots of business workflows that could be automated with it aren't and so on. So there is scope for raising prices a lot as the high value use cases float to the top, maybe even auctioning tokens. Let's say tomorrow OpenAI and Anthropic have a huge down round, or whatever event people think would mark the end of the bubble. That doesn't mean suddenly nobody is using AI. It means they have to rapidly reduce burn e.g. not doing new model versions, laying off staff and reducing the comp of those that remain, hiking prices a lot, getting more serious about ads and other monetized features. They will still be selling plenty of inferencing. In practice the action is mostly taking place out of public markets. We won't necessarily know what's happening at the most exposed companies until it's in the rear view mirror. Bubbles are a public markets phenomenon. See how "ride sharing"/taxi apps played out. Market dumping for long periods to buy market share, followed by a relatively easy transition to annual profitability without ever going public. Some investors probably got wiped along the way but we don't know who exactly or by how much. Most likely outcome: AI bubble will deflate steadily rather than suddenly burst. Resources are diverted from training to inferencing, new features slow down, new models are weaker and more expensive than new models and the old models are turned off anyway. That sort of thing. People will call it enshittification but it'll really just be the end of aggressive dumping.
  - dickersnoodle 8mo ago
    "much more demand than supply"? Demand from who?
    - joe_fishfish 8mo ago
      The demand from middle managers trying to replace their dev teams with Claude Code, mainly.
  - deleted 8mo ago
    [deleted]
- narrator 8mo ago
  Anyone who regularly tries to rent GPUs on VPS providers knows that they often sell out. This isn't a market with lots of capacity nobody needs. In the dot.com bubble there was lots of dark fiber nobody was using. In this bubble, almost every high-end GPU is being used fully by someone.
- thefounder 8mo ago
  Whatever happened to crypto/blockchain ASICs
  - dijit 8mo ago
    Nothing happened to them, they're still around; just consolidated into industrial operations. The "twist" is they rot as e-waste every 18 months when newer models arrive, generating roughly 30,000 metric tonnes of eWaste annually[0] with no recycling programmes from manufacturers (like Bitmain)... which is comparable to the entire country of the Netherlands. Turns out the decentralised currency for the people is also an environmental disaster built on planned obsolescence. Who knew. [0]: https://www.sciencedirect.com/science/article/abs/pii/S0921344921005103 https://www.sciencedirect.com/science/article/abs/pii/S09213...
    - SJC_Hacker 8mo ago
      > urns out the decentralised currency for the people is also an environmental disaster built on planned obsolescence. Who knew. Only proof of work systems, such as Bitcoin. Proof of stake such as Ethereum is a lot less energy intensive
      - dijit 8mo ago
        ethereum has a similar ewaste problem
        SJC_Hacker 8mo ago
        > ethereum has a similar ewaste problem Is it any worse now than say, the NYSE ? This reference says energy usage was 0.0026 TWh (2.6 GWh, or 2600 MWh) in a year https://ethereum.org/energy-consumption https://ethereum.org/energy-consumption If the power was used over the whole year (and not just one hour) (2600 MWh / year) / (24 * 365 h/year) = 0.29 MWh = 296 kWh. Thats like hair dryer levels of power consumption (if the hair dryver was left on all the time)
        8mo ago
- ornornor 8mo ago
  Heating!
- zozbot234 8mo ago
  Can they run Crysis?
  - nighthawk454 8mo ago
    Ironically, no
themafia 8mo ago
> Bubbles are a desirable feature of the American experiment Wild speculation detached from reality which destroys personal fortunes are not "a desirable feature." It's only a "desirable feature" to the nihilistic maniacs that run the markets as it's only beneficial to them.
- jdiez17 8mo ago
  > It's only a "desirable feature" to the nihilistic maniacs that run the markets as it's only beneficial to them. ... and which forces do you think are the core concept of "the American experiment"?
- zozbot234 8mo ago
  The trouble is, you can only tell what was "detached from reality" after the fact. Real-world bubbles must be credible by definition, or else they would deflate smoothly rather than growing out of control and then popping suddenly when the original expectations are dashed by reality.
- kryogen1c 8mo ago
  > Wild speculation detached from reality which destroys personal fortunes are not "a desirable feature." This is not the definition of a bubble, and is specifically contrary to what i said. A good bubble, like the automobile industry in the example I linked, paves the way for a whole new economic modalit - but value was still destroyed when that bubble popped and the market corrected. You may think its better to not have bubbles and limit the maximum economic rate of change (and you may be right), but the current system is not obviously wrong and has benefits.
rubenflamshep 8mo ago
Pretty good article until the bizarre post-script where they fall back on the tired "people derive meaning from their work" for why UBI is bad.
- WalterBright 8mo ago
  Meaning or not, UBI doesn't work because the math doesn't work. > bizarre It isn't bizarre at all. Without work people devolve into playing video games and smoking pot in their mom's basement. I remember summer vacations from school. It was great for a while, but soon I was looking forward to getting back to school.
  - krapp 8mo ago
    >Without work people devolve into playing video games and smoking pot in their mom's basement. Some people might, others wouldn't. Not everyone is a pot-smoking teenager.
    - WalterBright 8mo ago
      People like ice cream, too. But not everyone.
    - mlrtime 8mo ago
      Yup, there are adults and alcohol too.
  - olyjohn 8mo ago
    I have been off work for over 6 months now. I have been doing so many projects, and exploring so many places, working out, eating healthy, learning, and spending very little money doing so. I actually even quit smoking pot after doing it daily for 10 years. It's been amazing, and I'd rather never go back to work. I don't get how people can get so bored. There's so much to do and see.
    - WalterBright 8mo ago
eli_gottlieb 8mo ago
> Bubbles are a desirable feature of the American experiment. No they're not. You don't get to decide what other people desire.

toomuchtodo 8mo ago

What can we use fields of GPUs for next?

greenchair 8mo ago
cloud gaming?
dragontamer 8mo ago
We can use the GPUs for research (64-bit scientific compute), 3d graphics, a few other things. We programmers will reconfigure them to something useful. At least, the GPUs that are currently plugged in. A lot of this bullshit bubble crap is because most of those GPUs (and RAM) is sitting unplugged in a warehouse, because we don't even have enough power to turn all of them on. So if your question is how to use a GPU... I got plenty of useful non-AI related ideas. But only if we can plug them in. I wouldn't be surprised if many of those GPUs are just e-waste, never to turn on due to lack of power.
- cogman10 8mo ago
  > I wouldn't be surprised if many of those GPUs are just e-waste, never to turn on due to lack of power. That's my fear. The problem is these GPUs are specifically made for datacenters, So it's not like your average consumer is going to grab one to put into their gaming PCs. I also worry about what the pop ends up doing to consumer electronics. We'll have a bunch of manufacturers that have a bunch of capacity that they can no longer use to create products which people want to buy and a huge backstop of second hand goods that these liquidated AI companies will want to unload. That will put chip manufactures in a place where they'll need to get their money primarily from consumers if they want to stay in business. That's not the business model that they've operated on up until this point. We are looking at a situation where we have a bunch of oil derricks ready to pump, but shut off because it's too expensive to run the equipment making it not worth the energy.
  - dragontamer 8mo ago
    That's fine. Server is where we programmers are best at repurposing things. Just a bunch of always on boxes doing random crap in the background. Servers can (and do!!) use 10+ year old hardware. Consumers are kind of the weird the ones who are so impatient they need the latest and greatest.
- themafia 8mo ago
  The government is going to use them. The flock cameras are going to be fed into them. The bitcoin network will be crashed. A technological arms race just occurred in front of your eyes for the past 5 years and you think they're going to let the stockpile fall into civilian hands?
  - dragontamer 8mo ago
    In 2 years the next generation chips will be released and th se chips will be obsolete. That's truly e-waste. Now in practice, we programmers find uses of 10+ year old hardware as cheap webhosta, compiler/build boxes, Bamboo, unit tests, fuzzers and whatever. So as long as we can turn them on we programmers can and will find a use. But because we are power constrained, when the more efficient 1.8nm or 1.5nm chips get released (and when those chips use 30% or less power), no one will give a shit about the obsolete stockpile.
    - zozbot234 8mo ago
      I assume even really out of date cards and racks will readily find some use, when the present-day alternative costs ~$100k for a single card. Just have to run them on a low-enough basis that power use is not a significant portion of the overall cost of ownership.
    - themafia 8mo ago
      > will be obsolete. In what sense? Not competitive for chat bot providers to use? Is that a metric that matters? > when the more efficient 1.8nm or 1.5nm chips get released What if they don't get released? You don't have a broad and competitive set of players providing products in this realm. How hard would it be to stop this? > no one will give a shit about the obsolete stockpile. You have lived your life with ready access to cutting edge resources. You ever wonder how long that trend could _possibly_ last?
      - dragontamer 8mo ago
        As in: the 1.5nm or 1.8nm GPUs will use less power and therefore can actually be plugged in. We are power constrained. The GPUs of this generation can't even be plugged in yet because of these power constraints. When power is a problem, getting lower power GPUs in is a priority. The 1.8nm and 1.5nm next generation is already in production, and will likely launch before these massive GPU stockpiles are used. And then what? Why plug in last generations crap when the next generation is shipping? -------- Todays GPUs have to actually launch and be deployed while they are useful. Otherwise they could fully be obsolete and lose significant value.
- jdiez17 8mo ago
  I predict there's going to be a niche opening up for companies to recycle the expensive parts of all these compute hardware that AI companies are currently buying and will probably be obsolete/depreciated/replaced in the next 2-5 years. The easiest example is RAM chips. There will be people desoldering those ICs and putting them on DDR5 sticks to resell to the general consumer market.
- throwaway0123_5 8mo ago
  > 3d graphics Seems like the G in GPU is very obsolete now: https://www.tomshardware.com/news/nvidia-h100-benchmarkedin-games https://www.tomshardware.com/news/nvidia-h100-benchmarkedin-... > As it turns out Nvidia's H100, a card that costs over $30,000 performs worse than integrated GPUs in such benchmarks as 3DMark and Red Dead Redemption 2
- bee_rider 8mo ago
  It’ll be interesting to see what people come up with to get conventional scientific computing workloads to work on 16 bit or smaller data types. I think there’s some hope but it will require work.
- saati 8mo ago
  These AI optimized GPUs are criminally bad at 64bit, so no you won't use them for that.
irishcoffee 8mo ago
It’s too bad they’re all concentrated in buildings, having been hovered up by the billionaire class. I would love to live in the world where everyone joins a pool for inference or training, and as such gets the open source weights and models for free. We could call it: FOSS
mike_hearn 8mo ago
AI, obviously! A bubble doesn't mean demand vanishes overnight. There is - at current price points - much more demand than supply. That means the market can tolerate price hikes whilst keeping the accelerators busy. It seems likely that we're still just at the start of AI demand as most companies are still finding their feet with it, lots of devs still aren't using it at all, lots of business workflows that could be automated with it aren't and so on. So there is scope for raising prices a lot as the high value use cases float to the top, maybe even auctioning tokens. Let's say tomorrow OpenAI and Anthropic have a huge down round, or whatever event people think would mark the end of the bubble. That doesn't mean suddenly nobody is using AI. It means they have to rapidly reduce burn e.g. not doing new model versions, laying off staff and reducing the comp of those that remain, hiking prices a lot, getting more serious about ads and other monetized features. They will still be selling plenty of inferencing. In practice the action is mostly taking place out of public markets. We won't necessarily know what's happening at the most exposed companies until it's in the rear view mirror. Bubbles are a public markets phenomenon. See how "ride sharing"/taxi apps played out. Market dumping for long periods to buy market share, followed by a relatively easy transition to annual profitability without ever going public. Some investors probably got wiped along the way but we don't know who exactly or by how much. Most likely outcome: AI bubble will deflate steadily rather than suddenly burst. Resources are diverted from training to inferencing, new features slow down, new models are weaker and more expensive than new models and the old models are turned off anyway. That sort of thing. People will call it enshittification but it'll really just be the end of aggressive dumping.
- dickersnoodle 8mo ago
  "much more demand than supply"? Demand from who?
  - joe_fishfish 8mo ago
    The demand from middle managers trying to replace their dev teams with Claude Code, mainly.
- deleted 8mo ago
  [deleted]
narrator 8mo ago
Anyone who regularly tries to rent GPUs on VPS providers knows that they often sell out. This isn't a market with lots of capacity nobody needs. In the dot.com bubble there was lots of dark fiber nobody was using. In this bubble, almost every high-end GPU is being used fully by someone.
thefounder 8mo ago
Whatever happened to crypto/blockchain ASICs
- dijit 8mo ago
  Nothing happened to them, they're still around; just consolidated into industrial operations. The "twist" is they rot as e-waste every 18 months when newer models arrive, generating roughly 30,000 metric tonnes of eWaste annually[0] with no recycling programmes from manufacturers (like Bitmain)... which is comparable to the entire country of the Netherlands. Turns out the decentralised currency for the people is also an environmental disaster built on planned obsolescence. Who knew. [0]: https://www.sciencedirect.com/science/article/abs/pii/S0921344921005103 https://www.sciencedirect.com/science/article/abs/pii/S09213...
  - SJC_Hacker 8mo ago
    > urns out the decentralised currency for the people is also an environmental disaster built on planned obsolescence. Who knew. Only proof of work systems, such as Bitcoin. Proof of stake such as Ethereum is a lot less energy intensive
    - dijit 8mo ago
      ethereum has a similar ewaste problem
      - SJC_Hacker 8mo ago
        > ethereum has a similar ewaste problem Is it any worse now than say, the NYSE ? This reference says energy usage was 0.0026 TWh (2.6 GWh, or 2600 MWh) in a year https://ethereum.org/energy-consumption https://ethereum.org/energy-consumption If the power was used over the whole year (and not just one hour) (2600 MWh / year) / (24 * 365 h/year) = 0.29 MWh = 296 kWh. Thats like hair dryer levels of power consumption (if the hair dryver was left on all the time)
        8mo ago
ornornor 8mo ago
Heating!
zozbot234 8mo ago
Can they run Crysis?
- nighthawk454 8mo ago
  Ironically, no

themafia 8mo ago

> Bubbles are a desirable feature of the American experiment Wild speculation detached from reality which destroys personal fortunes are not "a desirable feature." It's only a "desirable feature" to the nihilistic maniacs that run the markets as it's only beneficial to them.

jdiez17 8mo ago
> It's only a "desirable feature" to the nihilistic maniacs that run the markets as it's only beneficial to them. ... and which forces do you think are the core concept of "the American experiment"?
zozbot234 8mo ago
The trouble is, you can only tell what was "detached from reality" after the fact. Real-world bubbles must be credible by definition, or else they would deflate smoothly rather than growing out of control and then popping suddenly when the original expectations are dashed by reality.
kryogen1c 8mo ago
> Wild speculation detached from reality which destroys personal fortunes are not "a desirable feature." This is not the definition of a bubble, and is specifically contrary to what i said. A good bubble, like the automobile industry in the example I linked, paves the way for a whole new economic modalit - but value was still destroyed when that bubble popped and the market corrected. You may think its better to not have bubbles and limit the maximum economic rate of change (and you may be right), but the current system is not obviously wrong and has benefits.

rubenflamshep 8mo ago

Pretty good article until the bizarre post-script where they fall back on the tired "people derive meaning from their work" for why UBI is bad.

WalterBright 8mo ago
Meaning or not, UBI doesn't work because the math doesn't work. > bizarre It isn't bizarre at all. Without work people devolve into playing video games and smoking pot in their mom's basement. I remember summer vacations from school. It was great for a while, but soon I was looking forward to getting back to school.
- krapp 8mo ago
  >Without work people devolve into playing video games and smoking pot in their mom's basement. Some people might, others wouldn't. Not everyone is a pot-smoking teenager.
  - WalterBright 8mo ago
    People like ice cream, too. But not everyone.
  - mlrtime 8mo ago
    Yup, there are adults and alcohol too.
- olyjohn 8mo ago
  I have been off work for over 6 months now. I have been doing so many projects, and exploring so many places, working out, eating healthy, learning, and spending very little money doing so. I actually even quit smoking pot after doing it daily for 10 years. It's been amazing, and I'd rather never go back to work. I don't get how people can get so bored. There's so much to do and see.
  - WalterBright 8mo ago

eli_gottlieb 8mo ago

> Bubbles are a desirable feature of the American experiment. No they're not. You don't get to decide what other people desire.