There will be nobody left to spend money, just increasing corporate and ultra high wealth spend. The rest will be left with food and water.
We are destroying currently valuable jobs to allocate resources to electricity and silicon, concentrating wealth into 10 companies pockets.
I don't know what comes after, but when you combine this with the Iran war it's going to be closer to economic depression.
You start looking like South Africa, Brazil, India or other large economies with high concentration of wealth at the top.
I don't see any doom or gloom, but what I do see is that tech companies massively ballooned headcount, and are now scrambling to return to sustainable levels, using anything as an excuse in order to avoid saying "we exercised poor judgment in 2020-2023". It must be AI! It's blockchain! It's tariffs! It's global warming! The list of excuses goes on and on, but just look at what the headcount was for these companies in 2020, and think about whether it makes sense for them to add that many new people.
Management screwed up.
I guess you can take this as a harbinger of Total Collapse, but I don't think that's warranted. Oracle added 30,000 people since 2020 and they are now realizing that this was foolish, given that Oracle's primary source of revenue growth is hiking license fees for legacy products. They don't need 30,000 new people. They don't even need the 130,000 people they had in 2020.
Why? That's wasteful. The money for that should go to the shareholders, and the moocher problem will solve itself in a couple of weeks.
Now, the nature of AI is to change the balance of the labour trade. We have a notion of the “economic value of the average person” which is presently very high in the western world.
What happens when the median figure drops through 0 thanks to AI?
Do the remaining wealth owners share their wealth? How often does this occur in existing systems we can compare against?
The cost of primary resources to products also goes toward 0, perhaps this offsets the decreasing economic power of the average person. But what forces protect them if their bargaining power is lost?
I follow your extrapolation in the first part, but this is where you lost me.
Why is the Iran war guaranteed to have long-term net negative consequences? It seems far too early to predict the outcome with any kind of certainty.
Combine that with the fact that the war is being led by a senile idiot who is unable to articulate a strategic purpose for the war in the first place and being prosecuted by someone who thinks that war crimes are aspirational, and you begin to understand that there is actually little prospect of this being resolved anytime soon.
Iran can close the straight of hormuz as retaliation, and there really isn't anything that can be done about it except for invasion. Other countries have similar capabilities or can acquire them readily. If Cuba wanted to close the gulf in retaliation for a US attack - they could, Denmark could lock the north sea to US shipping and naval traffic etc. etc.
Before this step, we had non-existent money loaned to build datacenters powered by non-existent power infrastructure to support future load that will never exist, with guaranteed revenue from companies that do not, and will never be able to pay.
Previously, this was propped up with circular revenue and investment. Now it's going to be propped up by dismantling the US tech industry.
This does not end well.
All of the current GPU investments are gonna hit zero, and probably a lot faster than the companies buying them realise. Definitely a lot faster than the investors realise.
I'd settle for some free 80GB A100 cards! ($7,000 2nd hand on ebay right now)
Regulatory capture to manufacture a monopolistic position is what many are planning. As gambling with other peoples money still has few fiscal consequences (see 2008), but will hurt Americans when the bubble implodes.
Note more cheap energy for home users typically means higher standards of living, and the Westinghouse electric economic cycle from the 1950s is now broken. Data centers are consuming the community infrastructure equity, and it will cost voters sooner or later.
Individuals can't stop trends, but one may profit from the predictable nature of both the unscrupulous and hapless. "Bulls make money, bears make money, pigs get slaughtered" as they say on wall-street. =3
"Memoirs of extraordinary popular delusions and the madness of crowds" (Charles Mackay, 1852)
https://www.gutenberg.org/files/24518/24518-h/24518-h.htm
"A Day in the Life of an Ensh*ttificator "
I don't even know what that company does. I'm sure it's valuable for a reason, just never understood what they do.
Edit: Google says they sell Database software. OK.
A database, plus American SAP, plus a sort of also-ran AWS-type thing, plus the sad remains of Sun, is about it.
Absolutely terrible products to work with both from a user and developer standpoint, but once they are up and running they are built like tanks.
I think you are about to see what post-AGI economics really looks like and it is not good at all.
So-called "AGI" has been hijacked and it isn't what you think it is.
https://www.reuters.com/business/oracle-plans-thousands-job-...
Ellison has borrowed money against $80 billion of his shares:
https://www.reuters.com/business/oracle-plans-thousands-job-...
Banks are getting nervous. The reaction of a psychopath would be to fire people so Ellison can pursue his AI fever dreams. Due to abnormal wealth concentration and total lack of common sense there is nothing to stop anyone should they go senile or insane.
The risk for the entire economy and the job market is immense.
Sell your ORCL while you can, folks
But they are still a tech company. So it is likely that this will also affect tech workers.
How may companies are just some custom data collectors
You can continue , we are at double pivot now. Code is a commodity. Not oracle db , but oracle business department for sure . You can build the same on the fly and curated.
At the same time to support old system you need 10x less people .
It just takes a single surprise to shock the market into chaos. My timeline is before 2030.
That's the story for Wall Street. Oracle went on a huge run in the market, that it did not deserve, and they're going to attempt to hold on to as much of that gain as they can. Wall Street will applaud slashing jobs if you can give them a good reason for it (and sometimes with no reason at all).
Amazon, Meta, Apple, Nvidia, Microsoft, Google are producing $700+ billion per year in op income. They have nothing else to spend it on. They will continue to fund a gigantic AI build out.
It does end well eventually, just as the dotcom era build-out ended well over the following decades. It ends with continued US dominance. Yes, the dotcom era saw a crash. The build out continued.
Browsers? The US won.
Ecommerce? The US and China won.
Search? The US won. China didn't win the search war, Baidu was supposed to be a serious global challenger to Google, that was widely hailed across tech circles as a known fact - it was inevitable. Nope. Google won. And Europe never did field a competitor at all.
China didn't win the smartphone war. Apple and Google won globally. Apple has produced trillions of dollars in profit on the back of that fact.
Cloud? China didn't even come close globally. The US won without any challenge at all. Europe never showed up. But but but Hetzner.
China didn't win the GPU war. Nvidia has the market, at least for this decade. That will produce over one trillion dollars in profit in just the next five or six years.
China didn't win the AI war. It was OpenAI's ChatGPT that shocked the world and set everything in motion. Now the US has the top three models in GPT, Gemini and Claude. Europe? Not even in the running (although they'd like to believe they are).
This all ends with the US remaining on top, with China as its only real peer.
Europe? There is no Europe in the equation, just as there wasn't for cloud or mobile apps or smartphones or personal computing.
At a national security level, the department of defense has already war-gamed mass unemployment. The defense sector would already have projected when the unemployment would happen and at what rate, I’m saying this to imply they had AI and judged its trajectory rather quickly awhile ago.
Data centers WILL happen, mass unemployment WILL happen, simply because, smarter people made it, assessed it, cannot deny it, and a large scale paradigm shift is occurring.
The data centers WILL get built (because the country needs it, don’t worry about why), AND you WILL get fired. Please await further instructions, thank you.
Try to stay in the same spot, oh, Covid helped with that remote work thing huh? See, this won’t be as painful as everyone thinks, it’s a nice smooth transition.
Edit:
I just want to add, the DoD is not going to let tech companies control the infrastructure of data centers either, too much of a security risk. So yeah, you better believe secret govt money is going to finance all of it, just like highways.
You’re welcome, now you don’t have to speculate.
Edit: and how will these data centers be protected from people rioting against them because they can't afford bread?
However, I’ve already seen a CTO of a F100 company explicitly state that whether AI is driving efficiency or not, the capital investment, and more importantly, the promises of efficiency to investors will mean some people will be let go.
Efficiency is output/input. The input is easy to measure. It’s cost and in this particular case salaries.
Output is a lot harder to measure, which means it can be fudged easily.
So you cut the easily measurable inputs and inflate the easily manipulable output.
One could imagine the reverse would also be possible, where you maintain inputs but inflate the output, but there is an asymmetry where investors will reward you for cutting costs even if there are no efficiency advantages that makes cutting inputs more sellable than inflating outputs.
First and foremost, this is about Oracle. For the short period I worked there, my impression about culture and tech was: mediocre. Not excellent, not poor but just a around average.
Which raises the question: why is it such a successful company commercially? I believe it's being ruthless to customers, employees and suppliers combined with cooking the financials.
Which bring me to your remark about output being difficult to measure. Imho Oracle had been exceptionally good at manipulating and obfuscating their output. And this was true long before AI came to the scene.
That seems like an insane gamble to me. Lay off all the workers now and hope that AI can deliver on its promise to replace them some time in the indeterminate future.
It will be another dependency for all companies to bear. Hopefully significant gains for humanity, tbd
Sometimes I feel like the only person left who remembers the pre-dotcom vibe. OpenClaw etc. should have set off alarms that we are back in the land of the Quick and the Dead.
This is why they landed one of the mega cybersecurity companies (the one who's name starts with C) as well as a globally distributed ridesharing businesses with sweetheart terms.
Oracle Cloud already represents 50% of Oracle's total revenue, and the AI story helps them justify that capex needed to fund their pivot into becoming a hyperscaler.
Compute in DCs already have an accounting lifespan of 3 years. The current trend of investments is a mix of expansion and well as upgrades on existing capacity.
This is why hyperscalers like Amazon, Microsoft, and GCP invested in inference ASICs a couple years ago, so they could migrate a larger mixture of their compute to these and offer services at better margins.
I was thinking any breakthrough in hardware (e.g. spintronics etc.), even if just partially effective, means all of this hardware would need to be replaced.
Infinite exponential growth is something we ALL "believe" in when we put a dollar into savings and expect to get a dollar and 5c out the next year.
The problem to me seems more that we tie all sorts of OTHER structural societal constructs to this one. To the degree that if we want to feed ourselves, clothe ourselves, and ensure shelter and security for ourselves and our loved ones - those basic _biological_ needs shared by most moderately sophisticated mammals - we are forced to plug into this system and ensure it delivers on its promise.
I've incorporated that infinite growth expectation into my kid's education plans, into our family retirement plans.
This is not a they issue, this is a we issue. The systemic structure is some parts organic but many parts choice and belief driven by general people on the street.
Oracle is using AI as a way to justify their pivot into becoming a Tier 1 Hyperscaler - Oracle Cloud now represents 50% of Oracle's overall revenue.
Becoming a hyperscaler is expensive (compute is pricey and a massive fixed cost), and by building an AI Infra story, Oracle can make a valid case as to why I should give Oracle money to expand their DC capacity.
Additionally, OCI has been landing marquee logos like a major cybersecurity company who's name starts with C and a global rideshare platform, and is taking advantage of enterprise customers who are price sensitive or investing in a secondary cloud provider to reduce vendor dependency.
OCI's infrastructure design is just good enough to work well enough most of the time, and you can't get cheaper.
I mean what do you expect them to do, I'm sure the OracleDB exodus has been long ongoing and they probably saw the writing on the wall years ago
Also Oracle is owned by Larry Ellison and hes in a competition with the other tech bros.
No. AI will BE your business software
Bread and refreshments will be provided, borders will be closed. Planning will be around de-population, naturally, aging will take care of it. Then the economy will settle into what America really needs to become, a small European nation with nukes.
:) Cheers.
From my own experience moving from Brazil, having ran businesses there, and later in life moving to "the West" (Sweden) there's simply no comparison between the hurdles you have in Brazil vs Sweden. No, not even the drumbeat is pointing in that direction, it's almost a literal different world.
You need to be more specific to make this kind of criticism, it is absurdly vague, and by that also quite unhelpful to any discussion.
My personal indicator is how many young (<50) entrepreneurs are building real stuff vs announcements of ex-bigco executives partnering with the government to jump on a new bandwagon.
Fizzle out: Strait reopens cause Iran needs ocean shipping.
Continue as now: oil trade disrupted, but using lots of missiles and drones and things; increased munitions demand leads to increased manufacturing jobs.
Boots on the ground: oil trade reopened, long term quagmire, probably more munitions production.
If you think food is expensive now, wait until fall!
Unrelated, Grapes of Wraith is a good read if you're looking for something to distract yourself with.
I've been in this industry for >30 years and it's dead.
That's probably where you'll end up if you're a company where that's an option.
No one was ever going to switch databases to a better DB as long as:
1) they did the bare minimum to ensure no alternative existed where switching made any sense.
2) they never charged too much where it made sense to switch thinking along the lines these businesses made decisions.
It's like the resource curse played out on a company scale.
If you have no incentive to get better, you won't.
Tons of mediocre enterprise software is built on Oracle DB.
Why enterprises are vendor locked-in? There are very few large enterprise players in every industry that implement all kind of ISO, standards, got an army of business analysts to generate million of requirement pages. Any new player must fight against that artificially overblown legacy systems, design and prove migration process is possible etc.
Here are just a bunch of industries my family/friends worked in and had first hand experience with these legacy systems - Airline (PSS), Banking, Healthcare, Hotel, Telecom.
And if they had it their way, Oracle would have similarly strangled every last customer of Java, MySQL, OpenOffice, Solaris, etc. to squeeze out every last dollar.
And then make it look like they're innovating.
Isnt that linear growth?
That is why we have the standard of living we have today
Now we’re being promised a wide range of white-collar jobs all being affected at the same time, always in a way which reduces the number of total jobs and concentrates power in people with assets. The position that people will find new things is begging the critical question of whether those people will have the money to get started or customers who can afford to buy from them, especially when sharecropping using someone else’s models with no guarantee of non-competition.
Then they will face financial distress, and questions over how they get the funding to continue as a going-concern. The only way that'll happen is via issues of shares at a lower price aka destroying the valuation of OAI compared with today.
Anthropic in comparison will be OK, as they have focused on building a viable business enterprise.
Nvidia has so much cash for R&D. You can bet they now have immense optimization and improvements in the pipeline, but why would they release anything groundbreaking right now?
There are no real competitors on their heels. As Intel did for decades, they will likely dole out improvements, only when necessary to remain ahead.
By 2030, I expect 10x improvement. We're also seeing stunning optimizations in trained models.
I imagine desktops running many of these local by 2030, even phones.
Will we need even 1/10 the datacenters for LLM in 2030? Certainly, privacy concerns are a thing.
Oh... Apple? lol.
Well that'd be funny wouldn't it.
Oh and dont forget Apple got rid of its reliance on Intel too. No reason why this can't happen again.
Google's lack of investment in marketing, design and sales/distributions capabilities is going to hurt them badly. MSFT is no different in many respects - latching onto the investments in 'relationships' and 'switching cost' initiatives that have kept customers loyal to them.
Apple is in great shape.
There's no guarantee whatsoever.
Especially because there's no a priori reason to expect it to occur "naturally". Strong inequality arises automatically in mathematical models.
http://www.scientificamerican.com/article/is-inequality-inev...
Late 18th century France has a historical point of view as to why the gains will diffuse out if the median person has no food.
Do we? I mean, isn't "because they always have" enough of an argument on its own?
I am hardly a libertarian ideologue nor AI-first LLM jockey. But I do think people tend to catastrophize too much. Blacksmiths were killed dead by the industrial revolution. "Secretary" is a forgotten art. It's been decades since an actuary actually calculated a sum on an actual table. And the apocalypse didn't arrive. All those jobs, and more, were backfilled by new stuff that was previously too expensive to contemplate. We're eating at more restaurants. We can find jobs as content creators and twitch streamers.
Life not only goes on after rapid technological change, it improves. That's not to say that every individual is going to appreciate it in the moment or that regulation and safety net work needs to happen at the margins. But, we'll all be fine.
AGImageddon is, at its core, just another economic phenomenon driven by technology. And that's basically always worked to society's benefit over the long term.
That all gets waived away with 'always worked to society's benefit'. It took almost 70 years and the post WW2 destruction of the rest of the worlds economies/infrastructure to create that 1950s American suburbanite world. 'always worked to society's benefit over the long term' is just handwaving not based on the reality of adapting, or if those societies even wanted to join in.
Because not all peoples/nations even had a choice. Japan among many originally opted out. But they were forced to 'modernize'. Peoples around the world were forced into the industrial world by railroads and machine guns and the industrial need for rubber/banana whatever plantations or lumber or strip mines. Once one nation passed through the door, every nation had to follow or be subjugated.
We have to be very careful about fallacies of division.
That's... just not remotely true, unless you're talking about it as a maybe-it-happened-to-someone story. In fact it's basically a lie.
Every income group in the US (and recognize that "blacksmiths" represent skilled trades workers who earned well above median and had for thousands of years!) saw huge, huge, HUGE increases between 1880 and 1950. I mean... are you high?
> It took almost 70 years and the post WW2 destruction of the rest of the worlds economies/infrastructure to create that 1950s American suburbanite world.
Again, big citation needed on this one. Western Europe was very close to US quality-of-life numbers by the 60's, and the more successful nations started to pass it in the 90's. (Also recognize that the US had already pulled ahead in the 30's, Germany and France were lagging even before the war). You're looking at something along the lines of a decade to rebuild, tops.
What forces act on this trend? How can we make predictions? An interesting metric, which tracks the aggregate of many complex factors is the distribution of wealth, which could be seen as proxy for the distribution of power or agency of a person in their society. Median income as a fraction of total wealth decreased nearly 50% in real terms over this same period. [3]
Now inversely, during the period where life quality increased most the last century (1920 - 1980) inequality was _falling_.
How is super-human AI advanced through 2030, 2040, 2050 likely to affect things? Will it sharpen the inequality or relax it?
With AI the cost of raw resources to products goes down, but it's likely inequality increases. It's not obvious which force has a bigger impact on human quality of life as things shake out. However, I think the strongest argument – which also explains the steady improvements in QoL through previous changes you mentioned – has been to follow inequality, or median share of power in society.
- [0] https://www.numbeo.com/quality-of-life/indices_explained.jsp
- [1] https://www.socialprogress.org/social-progress-index
>- [0] https://www.numbeo.com/quality-of-life/indices_explained.jsp
It's hard to take that metric seriously when the top city is Raleigh, NC. If that were the best city you'd expect people to vote with their feet and move their in droves.
Over time with the speed of technological development compounding on itself, the rate of change becoming much more acute, there's a debate to happen on the "what if this change happens over 5-10 years"? Can you imagine a world where in 10 years most well-paid office jobs are automated away, there's no generational change to re-educate and employ people, there would be loads of unemployable people who were highly-specialised to a world that ceased to exist, metaphorically overnight in the span of a human life.
Pushing this concern away with "it happened in history and we're fine" leaves a lot of room for catastrophising, at least a measured discussion about this scenario needs to be had, just in case it happens in a way that our historical past couldn't account for. No need to be a doomer, nor a luddite, to have the discussion: can we be in any way prepared for this case?
[1] "Blacksmithing" didn't disappear, obviously, but it survives as an expert craft for luxury goods. That's sort of what's going to happen to "hacking" in the future, I suspect.
[2] Likewise, some of the best positions survived as "personal assistants" for executive staff too lazy to learn to type. Interestingly these positions are some of the first being destroyed by the OpenClaw nonsense.
They were ridiculed for being 'behind on AI'. They haven't spent a dime on investing in AI-related infrastructure and so on...
And yet, they could stand to be the biggest beneficiaries if not the only. Given that they have plenty of resources in reserve and they are buying back stock - enabling insiders to have a greater say on actions in the future.
I’m not an insider so I wouldn’t know the specifics.
The professional typist' role evolved - to serving through other ways, as you say - by become executive assistants. Much like a Bank Tellers' role also evolved.
And its not because they (executives) are too lazy to type. They actually need people to manage their calendar, monitor emails etc. Moreover, the personal computing revolution led to an expansion of firms that needed more of said people.
Could this be disrupted by things like OpenClaw? Maybe. Personally I doubt it. Trust is a huge element that LLMs have yet to overcome and may never over come. Its the same reason Apple pulled "Apple Intelligence". I know this place is full of doom and gloom, but I am not a SWE by trade so I can see the bigger picture and not get bogged down by the fact it might affect my income.
Moreover, work is more 'fun' with people around. So to you it may seem irrational to keep employed for that basis (call it Culture) but to others, and in particular the executive class - nope. People will start realising things like this once the hysteria dies down.
The "role" might have evolved, but the jobs disappeared. There are, what, maybe two or three orders of magnitude fewer "executive assistants" than there were typists in the 70's? I was making an argument about economics, not job classification.
Most people are not making that much in blue collar work, but even if they were, it’s also not like freshly-laid off people can just switch overnight. Lots of that work isn’t great for middle aged people, etc. and anyone retraining is going to need support for training, certifications, etc. but that’s happening when they have the financial obligations of a successful mid-career person.
For example, say Google actually developed AGI and canned everyone. What happens to the market in Mountain View when everyone is trying to enter construction work or become auto mechanics at the same time that those industries are hammered by a lack of customers, and the real-estate market suddenly has entire blocks for sale?
That last part might seem extreme but I saw it in San Diego in the 90s: the defense contractors laid tons of people off after the Cold War collapse, and that meant that entire neighborhoods went from having streets of engineers who worked at the same places all scrambling at the same time. Fortunately, that wasn’t permanent or every sector of the economy (and some of them were able to repurpose things like carbon fiber aerospace techniques into golf clubs and bicycle frames) but there were literally people with engineering Ph.Ds competing for $15/hour QA jobs just to have health insurance.
This may or may not include AI researchers.
AGI would not make knowledge work valueless, it would move all the knowledge work value to the AGI companies.
Yep! That's the point :)
Those $300 billion dollar circular deals will become much more common.
That you want slaves. You want slaves. This is what you are asking for.
Unless you're paying the AGI? Then why not just... pay a human that is already present? Much more efficient.
https://www.scienceandindustrymuseum.org.uk/objects-and-stor...
https://healthinnovationmanchester.com/cottonopolis-to-metro...
You don't think there are 70 years between 1880 and the end of WW2 and the real start of suburban American prosperity we think of when we think of the end results today? And I need a citation? Or are you saying I should use 1960 not 1950s as the point, since it took a decade to rebuild in much of the world?
https://en.wikipedia.org/wiki/Industrial_Revolution
https://en.wikipedia.org/wiki/Suburb#Postwar_suburban_expans...
Or are you arguing that butter use recovered over margarine before the 1970s? https://www.ers.usda.gov/amber-waves/2016/july/butter-and-ma...
Which is to say, you cherry picked the data rather than looking at aggregates. Manchester industrialization being terribly managed isn't an indictment of steel machining or electrification, it means the government fucked up.
What you are claiming (that the industrial revolution led to lower quality of life generally) is simply false, period. And it won't be true of AGImageddon either, no matter how deeply you believe it. Economics just doesn't work that way.
I picked THE Industrial Revolution city. THE CITY where it all happened. Did your high school not have a history class? I picked where it went wrong, the first go live site. That's what you do for analyzing things. You don't pick go live 500. That isn't cherry picking, that's what we do when we discuss scenarios that INITIALLY came up so they don't happen again. We don't just whitewash like you would like.
I claimed the industrial revolution led to lower quality of life for the blacksmith. The modern narrative when talking about AI implies they just turned into 1950s style suburbanites and waives away any thought/planning/discussion like you are trying to do. The reality, as it factually happened, was a much worse life and it is worth considering when implementing something that could be just as impactful.
People like you want to just handwave away the inconvenient fact that I am more likely to be the blacksmith in Manchester than to be born in some post-work AI Utopia that may exist in 70 years after things settle. why can't we even discuss this? Why do we have to stumble blindly into it, to the point you call me a liar/cherry picker for pointing out basic history taught in high school and basic root cause analysis concepts?
The reason that Manchester is taught about in American high schools is so that we learn from it and we understand our current world didn't just magically happen. Good and bad happened along the way, and that we have to work within that reality. Good can come in the end, be positive IF progress IS being made. Bad will happen, fix it don't just accept it, challenge it. Think about it. Look to history to prevent the easy things to prevent.
And all the same logic applies to AI. Do we need to be willing to re-regulate and adjust as this is deployed? Almost certainly. Will it make us all wealthier? Undeniably.
You didn't know basic level history, called me liar, then a cherry picker for using the gold standard example.
You might want to check yourself before you tell people to stop, call them liars, cherry pickers, or make claims. No need to mis-represent me. My point is that 70 years of upheaval prior to the modern version of the world get ignored in the discussion. My point is that original people impacted, the proverbial blacksmith or buggy whip maker that 'adapted' had worse, shorter lives because of adapting.
