alt Hacker NewsThe big question is: who's going to get wiped, and what will that mean?
In 2008 the USA managed to export the shit assets generated by the mortgage boom , mostly to Europe. The consequence for the European economy and political setting have been quite sharp. For example it's hard to imagine a Brexit vote if the economic conditions of 2006 had persisted in the UK.
If the AI boom unwinds it's quite hard to see how the USA will export the pain this time. The issue is that the boom is tied to physical infrastructure in the USA and these assets will be stranded. Corporate bonds used to finance it are mostly owned by US pensions and 401k. We are likely to see many US insurance companies liquidated... and that will kill the annuities for many retirees.
The grid expansions that are being created in the USA will mean significant debts on US utility providers as well, if the data centres profitably come on line then this will get paid back. If not then American households are going to have to pay. Chip producers (Tiawan SK) will also get burned.
The USA will forfeit tech leadership, the US bond market will not permit Keynesian expansion. Basically the USA will be looking at a great depression. US hackernews friends need to find a cover story that stops their neighbours realising that they were part of the shit storm, and they also need to sharpen their camping skills and general outdoor hardiness. Alternatively -> try and get a French passport?
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We still need all the grid enhancements, just not for the data centers communities don’t want.
In many places if people charge their car and run the AC on a hot day the grid struggles. So the grid investment won’t go unused if AI implodes.
If Europe was able to muddle though the 2009 financial crash, then the US will be able to muddle through the next one. Cause that's just what you have to do.
To me this feels peak doomerism, and frankly tiring. The consequences of a total disaster are laid out in big detail but the possible causes leading to the disaster are...assumed and literally not addressed in the comment.
I mean, the premise is "who's going to get wiped[...]?", but the harder question is why would they? And that answer is not trivial because these companies are actually generating money and are competitive. The people and investors running these companies and investing are also not just standing still.
I think one can assume these companies are all a massive scam, but having used LLMs in my day to day every day from the very same companies this article talks about, I don't feel so. I only see the integration of intelligence becoming deeper, and even if cheaper per unit(token), many more tokens will be required. Productivity unlocked is further unlocking business and social opportunities we are only now exploring and getting to know. In the very essence it is very easy to see how this will turn out badly: after all a collapse passes all the known floors on the way down, but we have no idea where we are going up with this technology. I don't buy the comparison with the dotcom bubble because it is very easily falsified by simple metrics as the profitability of these technologies in the present. In the dotcom companies were not profitable, and many other counter examples disprove the comparison applicability. I will not even comment on the comparison with the subprime loans which were related to real estate, which has very little unknown upside.
Anyway, have some faith people this is hacker news, and with LLMs I never was able to do so much cool tinkering in my whole life. I have custom modifications on my gnome shell, I have privately developed file servers, I have automations that make use of my rooted TV, I have a prototype web page to help my folk's small business. I am able to support and learn from the LLM about topics that would be too expensive to get input from. For example with a calibrated microphone the LLM generated the custom equalized bands for my type of amplituner. It looked at a picture of my living room and suggested moving certain furniture like the curtains and measure it. With LLMs I was able to take pictures of nice rugs in the internet and visualize them in my living room before actually buying to great effect. So many possibilities... Focusing on the known unknowns is the easy part, let us have our imaginations run wild and let the whimsical hacker spirit return.
> The big question is: who's going to get wiped, and what will that mean?
The end of democracy, that's what all of this is about and why we've seen so many of the super rich build private bunkers or buy entire private islands, talking about shock collars for their staff to keep them from rising up. They're preparing.
You shall own nothing and rent everything, and the easiest way to achieve that is to wipe out everyone's retirement savings.
> Chip producers (Tiawan SK) will also get burned.
They'll be fine. They already got paid, and if the AI bubble crashes, there's years of pent up consumer demand just waiting for affordable slots at the chip fabs.
> Basically the USA will be looking at a great depression.
The US is looking at a return to medieval times. Rich elites lording over the poor masses.
Alternatively, we'll see World War 3. It's notable enough that most countries have slowly risen the temperature on disaster preparedness, even those not in direct line of fire of Russia.
> In 2008 the USA managed to export the shit assets generated by the mortgage boom, mostly to Europe
I didn't know about this. How did it work?