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"The Subprime AI Crisis" - Ed Zitron on the bubble's impending collapse (www.wheresyoured.at)

submitted 2 months ago by [email protected] to c/[email protected]

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None of what I write in this newsletter is about sowing doubt or "hating," but a sober evaluation of where we are today and where we may end up on the current path. I believe that the artificial intelligence boom — which would be better described as a generative AI boom — is (as I've said before) unsustainable, and will ultimately collapse. I also fear that said collapse could be ruinous to big tech, deeply damaging to the startup ecosystem, and will further sour public support for the tech industry.

Can't blame Zitron for being pretty downbeat in this - given the AI bubble's size and side-effects, its easy to see how its bursting can have some cataclysmic effects.

(Shameless self-promo: I ended up writing a bit about the potential aftermath as well)

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[–] [email protected] 11 points 2 months ago

So I should be clear, I dont think theres anything special about Tech companies that should let them be treated differently. But for whatever reason, it is a fact that places like We or Tesla or Theranos or fucking Groupon gets stupid valuations just because they're "tech" adjacent.

If the market ever catches on that theres no secret ingredient (and as Zitron's shown, there are pretty visible public numbers pointing at this), we're looking at a correction at the trillion dollar scale. Or maybe we never ask Google to put up or shut up, and just keep the fairy powder in our eyes forever.