Ask Lemmy

I heard that there would be a new Great Depression.

let it frame it to you in a different way.

when was the last time there were too many workers and not enough jobs? what happened then?

the depression will start before the pop. the pop will be the middle of the story.

AI is being pushed as a way to engineer an economic apocalypse that has never been seen before. it drives employees out of high paying jobs, which starves local governments of tax spanning from state income tax to individual sales tax. all of these governments are completely unaware of this happening because they're too occupied on saving themselves a slice of the pie. before they realize it, it will be too late.

the goal is to reduce the amount of high paying jobs to increase executive profits. these highly educated and paid workers will need to learn to subsist on low wage salaries. likely working in manufacturing or distribution facilities, though those jobs are dwindling too.

it all ends with a wealth gap not seen since the industrial revolution, the "golden age".

LLMs as we know them now are absolutely going to disappear. There won't be nice free text interfaces to models with trillions of parameters. That will seem obscenely extravagant.

n LLM is fantastically expensive to run: OpenAI makes a loss of over 10 billion dollars per year, and loses money even on its highest-oaying customers.

There's a reason why Anthropic and OpenAI were competing to sell their war-crimes-as-a-service to the Department of War. Private investment is starting to dry up and the Pentagon is one of the few places with the sort of money an LLM needs to keep alive.

Using generative AI is an extremely inefficient way to do most of the things the world uses it for at the moment. It only appears efficient because the AI companies are giving it away for free and eating the loss, burning through capital as fast as they can.

What will be left? Small local models that will go out of date quickly since they won't be continuously retrained. Still ok for writing boilerplate code and such, but not the thing that seems like it can replace every job on the planet. Generative AI will be seen as a much more limited tool.

Data centers that could be useful for lots of SaaS tasks that don't involve running supercomputer GPUs at full pace 24 hours a day so they fail and need to be replaced like vacuum tubes in a 1950s computer.

A countermovement called something like "slimline productivity" where doing stuff without AI becomes trendy. No need to spend so much on AI, just get your employees to do it by hand! Cheaper, more reliable, more human! After a few years everything is advertising itself as "slimline".

An enormous amount of work for software engineers who know how to work without AI, debugging the terrible AI-generated code that we've flooded the world with... if anyone can pay for it.

What's more interesting is that the AI fueled replacement of human labor is happening along side the largest global rebalancing of trade and finances in history. It could be argued that the U.S. is entering a phase of readjusting to not controlling all of the international trade and being able to run endless debts by doing it. At the end of WW2, the U.S. was able to set the terms for many countries. The contrast between these changes in reduced funding to social welfare programs, which the eventual collapse of the U.S. bond market will force as there will be no money to pay for much besides an outdated military and the interest on the debt. To keep the party going they massively hyped up AI and dumped even more imaginary dollars into it, hoping to be able to replace the need for workers. Creative ways of keeping the bond market bubble going crossed over between these two issues. One example is how tethered currency to the dollar for things like USDT have behind the scenes been funding an increasing share of Treasury debt. It's all one big interconnected house of cards where at the root of it is an idea based off having exorbitant privilege with a reserve currency. Where you can create this imaginary private company called the Federal Reserve which has magic balance sheets that can act as a second unlimited treasury, while feeding the debt issued by the primary treasury. All of this money just moves around causing inflation and higher interest payments. A system like this will have to collapse at some point and with all the international finanace changes happening, it's only a matter of time.

Sad news for you, we're already in a depression

The overall problem with humanity is that we think we're as smart as humans can be, so we are at the pinnacle of human achievement.

I just saw a video about the first synthesizer. It was built in 1897, and it took up the basement of a building the size of an entire city block. They had the technology to do it, but not to do it well. But they didn't see it that way. To them, it was the pinnacle of technology. But 75 years later, and we can put that same instrument in a suitcase.

Data Centers may be something that will be useful in the future, but our tech isn't good enough yet. Right now it takes an enormous building, and mind-boggling amounts of resources, and does incredible damage to the environment, as well as the damage to the economy and the job market.

It's like realizing that you can talk with two tin cans and a string, and then running out and installing a giant international system of tin cans & string, instead of waiting for the tech to advance to a point where we can do it properly.

Maybe in 50 years, the tech, regulations, and policy will be caught up to the ambition, but right now, we aren't ready for it at this level of technology.

AI won't replace everyone. Have you seen those police robots? At the end of the day, it will be a regular old cop arresting you for making trouble, don't worry.

People will loose money, the poor will get poorer, the rich will get richer. Some countries will become more fascist, others might become more sane. People will die, people will commit atrocities, people will fall in love and make more people, and the wheel keeps on turning.

True answer: no one knows.

My guess: it seems very similar to the dot Com bubble. Once it pops a lot of companies will lose a lot of money in the valuation and many will likely close their doors. But some will still exist, which are those with good business plans and a reasonable profitable business. Yes the dot Com bubble burst but there is still an internet. Companies basing their business on venture capital based on their valuation will likely crash and burn. A company forcing "Ai" for marketing or such will fail. A company with a good base business which happens to use Ai will probably be fine. For example a company making sandwiches to determine what sandwich you actually want to order probably will fail. A company who happens to use Ai to estimate how much of each type of meat and vegatables to buy each week based on recent use/sales will probably still be fine. Once the bubble burst companies who are only valuable because of marketing as "Ai" will likely die. There are uses but it's not everything but they are trying to shove it in everything.

It's already happening. A lot of services and free tiers got cut in the last months, and paid tiers got more expensive.

It'll not completely vanish, if you're a sane human being you probably know it has a few usages here and there.

But once you start using it for real work you're done, it's just a matter of time for the chaos.

I think we're in the stage of people slowly realizing that AI work isn't worth the price compared to a real human work. Because it's expensive for a not so well done job. While real worker do a solid job, with consistency, for the same or less price.

The irony, given that machines always did jobs faster and more consistenly (like a calculator). But this case here we're talking about a machine that try to mimic humans work without a well defined behavior.

LLM models are evolving very little these past months, very few improvements every new release. And so far no solid proof that it can do things well as humans do.

That Anthropic attempt on making agents build a C compiler was catastrophic, an insane amount of money for a thing filled with flaws. But proved it can't do anything true valuable and trustworthy.

I'll be buying so many hard drives!

It will be a great time to invest in the stock market.

People forget the 2008 crash. In March, 2009, before Obama policy was passed, the DOW bottomed out at 6,547.05.

It's currently at 49,704.34.

If you had invested in an index fund back then, you would have earned 7.59x your money.

I’d say that it depends on how healthy the economy is beyond the bubble

What will happen if a global pandemic breaks out? What about a hot war in Europe? Or if they close the Strait of Hormuz?

What seems to happen is the stock market dips for a few months and then we're back to breaking all-time highs again. So in other words - discounts on the stock market for a while, and an opportunity for anyone with some expendable cash to make a nice profit. I've bought all these dips and I'll do the same thing again.

It can't burst, it can't burst! I bet all of my bit coin on this! What are we going to do!? I'll get a bail out. Yeah that's it a fucking bail out! Heidi get me my cocaine I have a scheme to plot! Oh it's right here good. Good.

I will finally upgrade my PC.

If it bursts. It might slowly deflate for a bit before more air is pumped into it.

People mention the AI bubble popping because the rest of the American economy is already shit. The housing market is already seeing prices drop from Covid highs. Most major brands are going up-market because the typical consumer market is tapped out. Almost all non-AI tech is on the right side of the S curve, limiting growth.

The only thing good about the market right now is a bubble that keeps blowing up.

It is mostly built on silicon valley venture capital. So, not much will happen.

The stock portfoilio of some of them billionaires will have lower figures in front. Some of the medium riches will have one yacht less, or even two. The poor things!

I think it'll liquidate the kinda little bougie nest eggs of housing and 401's that are still out there. All this is happening on the major indexes.

The seventies kinda got the durable assets, like most property and such.

If it is as fucked up as it looks like, new law will be written because of it.