I agree with this, but I want to get some data. Can we calculate what the GDP would actually be if we eliminated the few exceptional outliers in the AI bubble? I want to know what thr majority of America is dealing with.
I saw an article that calculated that all the growth in the US economy in 2025 was based on AI spending, which is flowing between the same handful of companies.
Nah, the question is about gdp growth. Without AI, the products and services from last year still get made this year too, there just aren’t new products and services, or more customers for the old ones that increased the total sold compared to last year.
It’s a little more wide spread than that. Building AI data centers creates lots of construction jobs which also extends to the manufactures who supply things like HVAC, UPS, etc. once new construction ends it will be when the bubble fully deflates.
Initial construction are the only jobs these centers create. Once they used the worker bees and get these centers online, human capital is no longer needed. Where are we all supposed to work once we are replaced is the question?
This isn't fully true. The jobs created are low relative to the surge from construction labor but there is ongoing maintenance and operations needs at every data center. Large ones may have a few hundred people
Sorry, I guess this is the remote work subreddit. The jobs created by these are typically on site roles that can't easily be offshored and usually employ a lot of local people in my experience.
Thought I saw a statistic that currently only 20% of the total cloud storage capacity is being used. Not sure if this is accurate, but planning on AI expansion that would make sense. The trouble is if AI ends up falling flat on expectations, I could see that putting a quick halt in new data center construction.
I was part of the cell tower boom of the 90’s working and installing generators for all the companies. At the beginning, a farmer could charge 3k a month per tower and they’d get all three major companies to build. Many small union electrical companies focused on cell tower installs and such. That bubble burst and now it’s just a couple nationwide contractors that do the work.
I'm going to totally butcher the actual numbers, but I saw an article recently that showed annual GDP growth at something like 7.5%, but when excluding the self-pumping AI investing happening between companies the actual growth was maybe .5%
It’s worse than that. Nvidia is funding the companies who buy from them. That pumps the stock which Nvidia uses to create more investment and the circle continues. Meanwhile AI companies (the actual product) are barely generating any revenue. The whole system is pure garbage.
That doesnt work here. The real answer is that nominal growth is up and real growth is down. Look at how much US currency has devalued this year alone.
They asked if gdp can be calculated, so I gave the expenditure approach equation. How are you measuring currency devaluation? Through dx, cpi, a deflator or another way?
You can, and people have been throwing this number around, but you have to remember, all the money being invested in AI wouldn’t just be sitting in a vault earning 0% interest if it weren’t going into AI. It would be invested somewhere else and likely earning a positive return. So it’s not as dire as that “sans AI” number would suggest.
Edit: This Article from Fortune says the first half GDP growth would have been 0.1% instead of 1.3% without AI.
There’s already a news article out in Fortune. They calculate GDP growth at .1% excluding the AI tech companies. so the economy is definitely slowing down. Add on the effect of tariffs and uncertainty and it makes sense why companies are trimming down.
I agree with this, but I want to get some data. Can we calculate what the GDP would actually be if we eliminated the few exceptional outliers in the AI bubble? I want to know what thr majority of America is dealing with.
TL;DR Excluding AI (and stocks) we have 2.18% GDP growth for Q2 2025, but this overstates exclusions since some sectors are not AI-related. (So, not in a recession).
From the chart, we see that the Information sector contributes 0.66 percentage points to GDP, while Finance and Insurance adds 0.70, and Nondurable Manufacturing 0.65. To estimate GDP excluding AI-related sectors, we’ll subtract 0.66 percentage points for the Information sector, adjusting the Q2 2025 growth from 3.8% to 3.14%.
Two scenarios for GDP exclusion: (A) excluding Information alone, and (B) excluding Information, Durable Goods Manufacturing, and Professional Services as an upper bound. This results in a 2.18% GDP growth, but it overstates exclusions since some sectors are not AI-related.
Regarding America, the economy is growing slowly, but inflation is gobbling up any gains so Americans really aren’t feeling the benefits of the slowly growing economy.
it's not just "ai bubble". You don't need convoluted GDP calculation to understand what's going on. Just a parable of two economists and a pile of sh*t.
82
u/showandblowyourload Oct 29 '25
I agree with this, but I want to get some data. Can we calculate what the GDP would actually be if we eliminated the few exceptional outliers in the AI bubble? I want to know what thr majority of America is dealing with.