Yeah but the investments arent aiming for churning out SaaS apps. Its to automate large swathes of intellectual labour. Of which only SWE has been cracked yet. There is a question mark as to if the others will crack. If they arent then these investments will collapse from speculation down to reality. That possibility is what is being discussed here

As to whether that will happen, I think that risk is real. Because claude code isnt made by the generalozed capabilities of the tech but by good old non-generalozable hueristics and rule based engines. I dont think that will scale to other feilds at the factor these investments assume. Its the bitter lesson again. It scales with deliberate and specific design, not data, so it wont scale

We learnt this with ibm watson. Deepblue achieved chess supremacy but the last mile wasnt data driven, it was heiristic driven, and so watson, its successor, couldnt scale/generalize.

My prediction is that this speculation on LLMs with harnesses will collapse since they wont scale. We'll have another winter where the reasearchers will be leaft alone long wnough to come up with the next breakthrough (probably game theory based data driven agency) which might then create what this hypecycle is speculating

While I don't agree with your premise at all, even if it could one shot a SaaS product (a statement so vague it's meaningless) I don't think there's much of an argument for why that's economically useful. A lot of SaaS has free software/open source equivalents anyway (how else do you think the clanker's are able to plagiarize it?). People still pay for Office even though you could easily use LibreOffice, or GitHub when you could self host Forgejo. It's like when anthropic made a big deal out of making a broken compiler. Neat, so, after ingesting all of open source and burning a trillion tokens you ended up with something worse than what's already out there; and instead of doing something economically useful like giving a person money to build it or supporting the open source ecosystem, you're just wasting energy on datacenters.

Why even build SaaS apps? AI can just do what a SaaS app can

So good at it that I’m right now in the process of building instead of buying.

Here’s how that plays out in the economy:

- My company spent $50 on my tokens to build this internal tool

- Anthropic spent $XXX to deliver those tokens to me.

- The company I was going to buy the tool from lost $XX,XXX per year that I would have paid them.

I dunno, kind of sounds like the economy just got smaller.

I could usually accept the idea that software getting cheaper generally increases demand for software and expands the economy surrounding it, but I’m not sure if we have precedent for what happens when software becomes positively worthless.

that is not production ready

What does that have to do with the article?

> Meanwhile AI has gotten so good it can just about one shot a SaaS app.

There isn't a direct correlation between AI improvement or stagnation and whether or not the amount being spent by AI labs and the associated ecosystem will result in a financial crash.

Look into the history of railroads and the internet itself to see how massive levels of investment can result in economic crashes even when the thing being invested in produces real, widespread societal value.

One could argue that one of the nightmare economic scenarios for AI is actually that it gets too good too fast and results in a wipeout of the white collar worker that we are currently nowhere near ready to deal with given how propped up our economy is on consumer spending.