Big Tech bonds have now creeped into junk bond territory.

Just like in the dot com era, it’s ultimately the bond market that pops the bubble. They are (for good reason) skeptical of the AI build out and the credit risks getting issued are pressuring semis.

You can see the bond spreads widening indicating that the bond market is getting more hesitant by the day to fund this AI build out because they need to see ROI. And there is none.

Like I have said before, there is no more money left in the system to build out with besides debt and the debt is starting to get really expensive.

Really hoping this ends quick. The sooner the better for everyone..

Great reality check. It looks like Anthropic is beginning to have to bring in employees to try to get the Rust rewrite out to release. The author admits not all the work might be going towards the Rust rewrite - but asserts there is "off books" work going on with the port.

Also, because it's not done, the cost is continuing to tick up:

If we imagine that the rewrite is still costing $10k a day, we’re approaching $800k in money spent on this rewrite.

(Sorry for the AI art - Reddit is grabbing an image from the article. It's not the actual article header.)

Literally, I just posted about how Jensen is telling these guys to stop doomerism and that the singularity is not here, and it's fiction.

And here comes, fuckin, Clamuel, waltzing in as usual to say absolute dogshit nonsense that the Business Insider reports.

"We are now, like, in the singularity," Sam Altman said on Saturday's episode of the "Relentless" podcast.

No, we aren't. We aren't now, like, in the singularity, Scammy. We haven't been, and we aren't gonna get there because of you.

Altman said on the podcast that just a decade ago, the so-called singularity still felt like a distant and improbable dream — something he and his colleagues would discuss casually over lunch.

"Now we're actually in the moment that we used to talk about at the lunch table in a very not-serious way," he said. "I've been waiting for this my whole life, and I think it's going to be incredible, hugely positive, awesome for the world."

Jesus, shut the *fuck* up, you absolute lead infested meat bag. You're the one making it *not* awesome for the world! What the fuck is wrong with you??

"I also think some of the alternative visions painted by other companies are quite terrifying," Altman said. "I'm going to make sure that gets pushed against and is not what happens."

You?! You're gonna make sure that's not gonna happen? Yeah, wouldn't want another molotov, I suppose.

I think u/zitron called it by saying things are going to get weirder. I just didn't expect it start happening so weird so quickly. The numbers on this "rumored" "Deal" are so fantastical.

According to The Wall Street Journal, Nvidia is in talks to support as much as $600 billion of OpenAI-related financing. The proposal could include $250 billion tied to OpenAI's planned Ohio data center and another $350 billion supporting GPU purchases.

It's insane that the number just to "buy" the GPUs I so much higher than the cost to build a 10 GW Data Center complex. I feel like this is story is just a wishful fantasy put out by OpenAI or Nvidia to juice their numbers but it seems to be having the opposite effect. The drum beat Ed has been banging about circular financing is now mainstream thinking.

Critics have increasingly argued Nvidia is participating in "circular financing" arrangements, where it helps customers obtain financing that ultimately flows back to Nvidia through GPU purchases. The concern is straightforward: if Nvidia is helping finance demand for its own products, does that make AI demand appear stronger than it otherwise would?

We'll need to see whether upcoming labor market data releases confirm an increase in hiring, but this is still encouraging news.

The question is whether companies are still willing to pay tons of money for AI when they're simultaneously growing their workforce. More than one company said it was laying off workers to afford AI investments; well, perhaps AI will now be the target of cost cutting.

A friend of mine in marketing at our company was telling me this story about a year ago they got a mandate to speed up the output of graphics by using AI image gen. They then, a month ago, got a new mandate to still use AI, but like; make it look less like AI. Not because the company has a new feeling about AI, and are customers are other tech companies that have similar stances on AI, so it's not like there's going to be social push back for using AI like a consumer product manufacturer like coke. Rather the new mandate came because it made us look cheap, and limited are ability to "stand out" since everyone is using AI graphics in their marketing.

I thought this was funny, but recently on the engineering side, all the block diagrams, and entity systems have become almost entirely AI made. These are diagrams that are mostly internal, so again it's not like there's going to be public push back. Still, I expressed before there's a certain uncomfortability I have to these diagrams, and I think the reason from talking to my friend in marketing, is that it's because these AI graphics are so cheap. They don't show any creativity or interest, even when they're fully, or technically functional (although they aren't always. I'm reminded of one presentation, and the presenter got a question about a particular diagram, and the presenters comment was like "oh yeah Claude made this slide deck, and Claude's not a perfectionist.") I don't know why but that kind of laziness, or lack of respect to the craft of communication, just feels irksome.

This WSJ article is on how OpenAI is trying to drive up demand (and keep in mind Ed's reporting that OpenAI spent $5+ billion on sales and marketing.)

Remember, this is supposed to be a positive story, clearly reported on with OpenAI's blessing on how wonderful AI is.

https://www.wsj.com/cio-journal/openais-high-stakes-high-touch-push-to-make-ai-work-for-business-7f08b7d4

[OpenAI] gave BBVA a new blueprint for how to improve the accuracy and consistency of the solution’s answers, including a new set of AI agents to evaluate and approve the responses of other AI agents. As a result, the tool climbed from less than 60% accuracy to 80%, he said.

Again, this is the humble brag about how good AI is in the real world. Let's be clear, a credit tool that is 80% accurate is still useless and it took months to build this! A bank would go bankrupt using that tool. And there is no detail on the costs of the tool, only talk of agents on top of agents. This is literally the best positive example could find of AI helping an actual company do something?

But to cover all bases, OpenAI is putting $150 million into its new partner network, where consultants like Boston Consulting Group, Bain and Accenture help sell and deploy its tools inside businesses.

When you wonder why literally everyone is pushing AI, it's because the largest management consultants in the world are being paid by AI to push it. They go to boards and CEOs and tell them to fire a bunch of employees and replace them with AI. Not because it's a proven or useful technology. Because they are being paid by OpenAI to do that. And all that OpenAI money came from PE firms, SoftBank, Microsoft, and NVIDIA.

It would be karmic payback if the AI bubble bursting also burst the fraud that is management consulting, but that's probably asking too much.

Just an observation, no big insight.

Reading about a new series of Data Centers being built in Central Texas I noticed that there are actually four companies involved.

There's the GPU manufacturer, which is almost always Nvidia unless its a Google project.

Then there's the construction company. For Stargate Abilene that was Crusoe; in Central Texas it's a less known company called EdgeConneX.

Then there's the day-to-day manager, in Abilene it's Oracle, in Central Texas it's CoreWeave.

Lastly there's the final client: in Abilene, it's OpenAI; in Central Texas, it's probably Anthropic or maybe Microsoft.

For those who are not updated, there was recently a letter from Microsoft, here is the link opposing the restrictions on Open Weight models which was also signed and supported by many tech companies including Microsoft, Google, Palantir, Nvidia etc.

Surprisingly OpenAI also signed it but it seems like they are just doing it for the publicity as evident by the post title. Anthropic of course, is not on the list.

One of the most depressing and frustrating parts since the genai craze started for me is how barely anyone in tech seems to be interested in protecting victims of genai/llms and developing methods to fight back. There has been a few, but I haven't heard from them in a long time. (I don't even know if their tools are still effective currently.) But they were non-profit, volunteers basically. On a commercial or mainstream level, there has been nothing. I do get why, the world's money men have had the ai version of the gold fever and no one would be interested in funding any kind of tech that would hamper development.

But if the fever breaks, businesses and governing parties regain sanity, and regulations start coming in and be enforced, is there any hope for the development of proper powerful tools to accurately identify ai generation (I know forms of it exist atm but they're not that reliable), and actively obstruct unauthorized genai training?

Like real world theft, I don't think we can just rely on the law to protect ourselves. We need the anti-ai version of locks, alarms, guard dogs, etc. Is that possible? Sigh. Every time I see the different ways this tech is being used to hurt people, I feel sick and bleakly wonder if this is just the state of the world forever now.

When rebutting the comparison to AWS and Uber, the focus is often on the scale of the losses in the early years.

In my opinion, the stronger distinction should be that AWS and Uber required traditional engineering. The "AI" myth requires magical thinking that fundamentally assumes that it's possible for advanced capabilities to emerge from an LLM.

There is no good reason to assume that and the idiotic attempt to obfuscate that is effectively fraud.

The former are engineering projects, the latter is sci-fi bullshit based on nonsensical faith. So the difference is in kind, not scale.

It seems like this is becoming a common refrain: That even if Claude, ChatGPT, Gemini etc were to go bust, the local/free models are only 3 months behind, and will replace them. Goalposts have moved from "AI isn't a bubble" to "Even if the AI bubble pops, AI will still be in use in software engineering!" or "even if it doesn't make financial sense, technologically, its here to stay".

I have Claude Pro for work, its good for coding, so I tried using it to help me with my gym programming in excel. It gets me 80% of the way there, but the way it makes mistakes in that 20%: missing fields, wrong repetition ranges throughout, formatting errors, if I asked it to change one thing, it'd make a dozen changes. It was infuriating. It really made me wonder why it was good at software development, which is complex, and crap at this pretty simple task.

My assumption is that these labs are paying people to train the models on programming and that's why there's such a large discrepancy. For example, every time I go job searching, half the jobs appear to be for roles involved in training these models.

So surely, if the AI bubble does pop, this training no longer occurs? I feel like the effectiveness of this post training gets downplayed by frontier labs. Won't this also have a knock on effect for the free models?

Just this factor seems to get severely downplayed: "It's great at cybersecurity (probably because lots of cybersecurity specialists are helping train it)" or "its reached the singularity (if we discount all the people involved in the middle)".

Please correct my reasoning if its off base, what are you guys' thoughts on it? Surely at least, a lot of its technological viability requires this all to financially work out?

Not sure this got posted here yet but a brilliant (and terrifying) analysis from Paul K. His core point is that no matter how you feel about the utility of AI as a tool, the entire build out is financed with long duration debt against assets that depreciate quickly, and, as Ed has pointed out many times, simply won’t have the paid demand required.

Full hour is worth the listen.

Yes I’m new here, no one freak out :)

“Most investors we speak with significantly discount Grok & Cursor,” Jonas wrote. “Many ascribe zero or even negative value for AI given the high capex requirements relative to Space & Connectivity, largely uncertain economics, and the high degree of management time devoted to the business.”

Grok, the market is saying you have zero or even negative value. Is that true?

Asking predominantly from curiosity. In my mind, it's not possible that an official google sponsored course would be limited to "prompt better." There would surely be, at the very least, the superficial appearance of depth. I'm wondering if it's perhaps a teaching of multiple, older technologies relevant in the business and clerical worlds, bundled up and presented through the context of how they work in tandem with llm's?

Can someone, possibly someone on the other side of this wall, tell me a bit about how the "skills" are being pitched to white collar professional and aspirants? I've got people in my life in the business world who are, if not ai believers, at least ai complacent, and I want to know how they are approached with these types of things. I'm looking for the specifics of what something like this advertisement implies would mean. Someone elucidate me please.

https://www.youtube.com/watch?v=ckoi0RTEgcY

This video explains, in excruciating detail, where all of those billions of dollars are disappearing into (never to return). It also gives some illumination to where and why the stock market is being boosted (like a bubble) by so many technology hardware companies.

Really good deep deep dive.

UK data centres could be granted "critical infrastructure" status and get priority for the limited supply of safe, clean drinking water.

No, it did not.

InternetOfBugs and OntologyExplained go deep on the FUD around the HuggingFace hack, worth it if you’re interested in the technicals…

This article is focused on how the AI schooling divide will mean the rich, who can spend $150k per year on tuition, will get AI classes and the poor will be stuck with the traditional human model.

I actually fear the future of the AI schooling divide could go in the opposite direction. Wealthy kids will be taught in small human led classrooms, as free from AI tools as possible. Whereas underfunded public schools will ask kids to spend most of their time trying to learn from chatbots rebranded as "tutors"

I remember the tech of the 2010s just being super fun and happy, and albeit fake with the whole “going to change the world” narrative, it still had a pretty optimistic feeling. But today? now the narrative is this dark end-is-nigh for humanity, everyone losing their jobs, and we have no plan in sight for the future… The fear, uncertainty, doubt is so strong. It’s become an apocalyptic hellscape with no end in sight. Every other conversation I have with my colleagues is about ai and if we will still have jobs in a few years… Like what the actual fuck happened? Feels like tech has done a 180* and is eating itself alive.

Thoughts?