ThisAin'tNoFoolin'AroundVille
Depending on where you've been looking, you might have come across a story or two that questioning where all the monetization/growth will come from to support the hugely big investments in AI.
Well...
What if the overlords behind all that over investification don't give a hoot-in-heckfire about real growth because they have instead gone all in on the 'shedding'?
Patricia Cohen of the NY Times has been chasing that story (web archive link):
In other words...
Depending on where you've been looking, you might have come across a story or two that questioning where all the monetization/growth will come from to support the hugely big investments in AI.
Well...
What if the overlords behind all that over investification don't give a hoot-in-heckfire about real growth because they have instead gone all in on the 'shedding'?
Patricia Cohen of the NY Times has been chasing that story (web archive link):
The stock market bounces in recent weeks are just one indicator of the profound uncertainty and heightened risks running through the global economy and financial system.It’s not simply that the hundreds of billions of dollars flooding into artificial intelligence investments might turn out to be a bubble. Or that the use of cryptocurrencies in mainstream banking is spreading even as their values have plunged after soaring to record highs...{snip}...The stock market run-up — the S&P 500 is still up about 14 percent this year despite the recent shivers — could foreshadow widespread economic gains. But (Harvard economist Kenneth) Rogoff doesn’t think that is the case.“A big part of the high stock prices is not a reflection of high future growth,” he said. Rather, it is a sign that A.I. is expected to boost productivity and shrink employment. “The firms all think they’re going to shed a lot of labor, and that’s why the profits will be high,” he said...
In other words...
Our over investified AI overlords may not actually be betting on economic growth, but instead betting on economic collapse.
Collapse for all of us who are not over OIAI overlords that is.
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Collapse for all of us who are not over OIAI overlords that is.
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Earworm not so subtly dropped into the subheader?...This!
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10 comments:
Kind of silly really
I always wonder if these economic “geniuses “ ever think about who will buy their products if more and more people are losing their jobs because of efficiencies, robotics , and now AI? Mr. Ford had that somewhat figured out when he decided to lay his workers enough that they could afford one of the automobiles they were building.
I personally don’t see this AI thing being that great and certainly not as good as it’s being made out to be or at least not for the uses that are mostly concerned with trimming human labour numbers. Used as a tool, yes, as a worker, no.
GF--
I agree, but...I'm not sure the overlords want to re-coup their investment in classical sense...However, if they can bamboozle the rest of the world to buy into it and destabilize the world's economy?...Well, wouldn't that be just the way they think things ought to work?
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…lay his workers… should be …pay his workers…
They're pretty naive if they think they can get away with that. Do they think the can all go and live it their libertarian paradise island? There are always unintended consequences. Like when Charlie Kirk found out that stochastic terrorism is in fact , stochastic!
Graham--
The question is...Are we all John Henry now?
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In today's world of millionaires, billionaires and the odd trillionaire, the stock market is all but meaningless. It is manipulated on a grand scale and smells like the "Ring" in the Art Market.
The "Eye" dabbles in the "Art" market and knows enough to not get really screwed, but one becomes aware of the "Ring".
The "Ring" is a well heeled group of hig hend antique dealers, gallery owners and otheres who make money conning the local yokels.
There are several versions of the "Ring" but i will give it a go to explain.
Pooling their money the "Ring" buys art, mostly at auction, of lesser known artists. They pay up to $200 or so pert painting and continue this over a year or so. As time passes, the value of the lesser known artist continues and his works for under $200 grow scarce.
Now the fun begins, they enter their paintings and bid up against the punters buying the art and after a while, pieces that sold for under $200, may reach as high as $2,000.
Now if one had 30 or 40 such paintings or more a tidy profit is made and the "Ring" repeats this with another lesser known artist and over time, the value drops, eventually dropping back to the original $200 price.
Well...I guess you could go with ol' reliable Mr. Sacks:
"I don't think this is the beginning of a bust cycle," White House AI czar and venture capitalist David Sacks said on his podcast All-In. "I think that we're in a boom. We're in an investment super-cycle."
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(Forest industry worker snark alert.) On the John Henry thing: there's already a whole line of us that would reach to the moon and back if that were possible that y'all are free to join the back of when the AI chaps are ready to toss you aside like a ketchup smeared McDonalds burger wrapper.
Beer--
It's coming to my day job business...And, weirdly, many of my colleagues are happily helping to make it happen.
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