If you decide that none of the AI hype applies to you... you might want to guess again. The sums being spent and already promised to be spent in the coming years are far beyond reason. Valuations on the companies involved are beyond reason. This is not likely to end well, and it will affect all of us, not just those who have strong opinions about the various aspects.
Perhaps a better analogy is the Y2K/Dot Com bubble bust.
Money flows to “opportunities” which don’t pan out. Companies go belly-up. Some people lose a pile of cash. But the technology emerges stronger and more solid and transforms the entire economy over the following decades.
Unless the hype is real and AI does displace a huge chunk of white collar jobs.
There seems to be a cyclical pattern to Americans... and maybe others. Use IBM as an example. In the 1960s & early 70s IBM focused on efficiency, efficiency in hardware, efficiency in software. Then it came to a dominant position. It peaked about 1980.
IBM realized that it billed and made money on the basis of CPU and hardware used. So new development was towards inefficiency that used more billable CPU and hardware. In the short term, that is the way it made profit. IBM fought against us techies that improved the efficiency.
Although the details are now different, the game is the same. AI is trying to convince society that BIG IS BETTER.
AI seems relatively unconcerned that AI input data and algorithm are incomplete, biased. AI seems unconcerned that output is biased, incomplete, inaccurate. Hallucinations are a feature, not a defect. (How many times did IBM tell us a defect was a feature?)
AI is bloated with unnecessary expense. It is not lean n mean. It is the vulnerable giant now. It doesn’t need to be that way.
In US society there is an increasing gap between the Stock Market rich and the stable wages middle class. When the correction comes, will the rich who lose stock market value be willing to take the hit? Or will they try to shift the cost of their wasteful inefficiency on the rest of us?
Politicians and demagogues will twist the narrative.
Not helping is the fact that 1) The Hormuz adventure has been very costly. There seems to be no face-saving way to change course. 2) Apart from Hormuz government at all levels is extremely inefficient and a big drag on the economy. DOGE was a start. But there is much left to be done. We are nipping at the small fry, the Somalis when the big waste is accepted as business as usual.
He makes a good point about the 2006-2008 housing market crash being related to a possible AI crash.
However, he did not talk about the GOVERNMENT’S REACTION to the housing market crash.
Namely, the Federal Government reduced housing mortgage rates to about 3% and over the past 18 years housing prices have nearly tripled in price.
And the US Treasury debt has gone from $9 trillion in 2008 to $40 trillion in 2026.
Such is what happens when politicians get involved in managing supply/demand economics.
What sounds good at the outset turns to crap in the long run.
Messing around with the Invisible Hand of Supply/Demand is not a good idea.
In other words, a Ponzi Scheme.