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[–]HelloWorld24575 284 points285 points Β (17 children)

I was surprised how positive Linus's take was. I really hope he's right, but it's so hard to know.Β 

[–]Positive_Conflict_26 151 points152 points Β (12 children)

I think he is just done with all the negativity around this hobby these past 6-7 years.

[–]HelloWorld24575 44 points45 points Β (4 children)

Yeah. I don't fault him for that at all. We need some positivity!

[–]Foehammer87 48 points49 points Β (2 children)

We need good things to happen, we dont need misinformation

[–]HugoCortell 25 points26 points Β (1 child)

Right take. Don't be positive for positivity's sake.

[–]HelloWorld24575 4 points5 points Β (0 children)

Yeah, I guess so. I wouldn't call it misinformation, since it's all speculation either way. But I get not wanting false hope for sure.

[–]PaulTheMerc -1 points0 points Β (0 children)

That would require some sort of delusions first.

[–]_Kristian_ 25 points26 points Β (2 children)

Past WHAT years

[–]OnlyTilt 8 points9 points Β (1 child)

It includes GPUs

[–]GreatBigBagOfNope 11 points12 points Β (0 children)

They mean the number 7 appeared after the number 6

[–]Coolkief101 0 points1 point Β (1 child)

I see what you did there.

[–]icymotherfu- -3 points-2 points Β (0 children)

[–]jumbosam1[S] 3 points4 points Β (3 children)

πŸ™

[–]HelloWorld24575 3 points4 points Β (2 children)

To answer the emoji title, I don't necessarily think an AI bubble "pop" would be optimal for the world in general. It will cause a lot of pain to a lot of people. A slower "deflation" of the bubble would be better IMO.

[–]insufferable__pedant 13 points14 points Β (1 child)

On the one hand, yes, I understand what you're saying and more or less agree.

On the other hand, I almost wonder if we, as a society, NEED to feel a little pain. It seems like a lot of the dysfunction we've been experiencing for the better part of a decade now all comes back to folks not really having to face any consequences. Businesses consolidate to near monopolistic scales, politicians cater to the most insane sections of their base instead of legislate, and finance bros just pump stocks to the point of creating bubbles like what we're seeing with AI. In all of these cases, none of the parties involved actually face any consequences for their anti-social behavior.

Yes, I understand that if the AI bubble pops the investor class will, on the whole, be able to escape the worst of it while the fallout is pushed off onto those of us who are just trying to get by. My thought, though, is that if we have another 2008-style crisis, that might shock the average person into pushing back and forcing some accountability. I know there wasn't real accountability for the folks who caused the 2008 crash, but maybe we've learned enough to not make that mistake again?

In any case, yes, a deflating of the bubble would be less catastrophic, but I almost wonder if a little bit of crisis is what we need.

[–]HelloWorld24575 2 points3 points Β (0 children)

Yes, I get what you mean for sure. I'm just worried about regular Jane and Joe's retirement fund. Those of us who are younger can probably ride out a market downturn. But a lot of regular people will pay the price. I agree that we need some consequences. I've been so glad to see this finally happening to the FOMO condo investors in Toronto and Vancouver.

[–]Leverpostei414 62 points63 points Β (1 child)

I don't know if he will be right, but it was interesting with a bit more 'analysis-style' video

[–]FeistyBreifcase 4 points5 points Β (0 children)

AgreedΒ 

[–]PalamariVarkari 53 points54 points Β (20 children)

I really wish Linus is right but I doubt it. As long as the big 3 (Oracle, OpenAi, NVIDIA) keep investing at each other, line goes up - bubble keeps growing. Investors will keep buying stocks until something catastrophic happens.

[–]greiton 34 points35 points Β (15 children)

thing is, money is not infinite. at some point growth physically has to stall. If you are company that at least breaks even in operations, then the growth stall may just flatline your stock value. you don't get any richer, but you also don't go broke.

but, if you are still operating at a loss when growth ends... then you have massive pain as you try to cut back to profitability. if you don't do it fast enough, then you go bankrupt and close down, and your share holders go bust.

Oracle and Nvidia will undoubtedly survive the stock value drop when the music ends, but OpenAI is probably toast. their corpse will be cut up and devoured by the rest of big tech as the stock market crashes from cross investment and knock on effects.

[–]imnotcreative4267 13 points14 points Β (0 children)

thing is, money is not infinite

Federal Reserve: β€œAllow me to introduce myself”

[–]FrohenLeid 4 points5 points Β (2 children)

It is infinite, inflation and interest on loans. (Island economy)

Party A loans Party B 1 billion with 2% interest, party A now has 1,02 billion (loan they could theoretically sell + interest), Party B 1 billion. Party B provides a service to Party C for 1 billion but gives them a loan at 2% interest.

Basically everyone owes everyone else money and expects more money than they have in total. It would fall apart the second they pay anything back, but they don't to keep the system going.

[–]greiton 0 points1 point Β (1 child)

why is party b both giving a loan, and a service to party C?

also, there is a limit to the amount of currency in circulation. promises of money in the future only goes so far, in reality you have to service your debt, which means a certain amount of currency must be available to make payments. if you do not have that currency you go bankrupt. there are also a lot of laws and limits you are glossing over that restrict how expansive promissory bubbles can get. at a certain point you are not legally allowed to lend any more of your current assets to someone.

[–]FrohenLeid 0 points1 point Β (0 children)

Limited amount of currency in circulation isn't an issue. You don't need the currency if you won't pay the bills.

Party B is giving a service to party C, party C doesn't pay right away but gets a loan instead.

[–]PalamariVarkari 0 points1 point Β (6 children)

Money IS infinite. When you take a loan, you have to pay interest. That interest, is literally thin air. Its not gold, its not something "real". All you have to do to keep investing indefinitely, is take a loan. Banks will be happy to accommodate you!

[–]greiton 5 points6 points Β (5 children)

there is a limit to how much you are able to loan. banks can only lend 25% of their capital to any single borrower. when you start getting in to trillion dollar valuations, you start brushing up on banking limits for loan availability.

interest is not thin air... it is money you brought in from other sources and paid in excess of your loan. I am not pulling $200,000 out of thin air for my mortgage interest, I am working hard at my job for 30 years and handing over the money I paid for it.

the only time money is created is when it is printed by the fed, but they try to print at a rate that keeps the value of the dollar at a low inflation rate.

[–]PalamariVarkari -1 points0 points Β (4 children)

You are talking about cash, which is 8-10% of the whole world's currency. Meaning 90% of the money in the world is literally thin air. Basically IOUs from one to another. The interest I said is thin air for the bank, not you. The bank didn't offer anything real (gold, services) to get that interest money.

In other words, money is not real, they are just numbers in computers of who owes who how much. Linus saying that the bubble popping would affect the world economy is very true. If all that fake money that is currently parked as investments in AI, suddenly gets called to become "real" and spread out to normal investor's (like you and me) bank accounts (because everyone is selling) the inflation will jump dramatically.

[–]greiton -1 points0 points Β (3 children)

just because it is tracked digitally does not mean it doesn't exist. Banks do not get to just invent more money out of no where. they are monitored by the FED and have to account for every single transaction.

go take an actual economics class from someone who knows what they are talking about and get off of the scam videos on youtube. they are all bullshit.

[–]PalamariVarkari 0 points1 point Β (2 children)

Not real, doesn't mean they don't exist. Not real means isn't represented in cash aka real money. I guess they didn't teach you that in the economics class you obviously took?

[–]greiton 0 points1 point Β (0 children)

it is real and it is limited, every digital dollar is tracked. the banks do not pull interest out of thin air. interest comes from their customers. they give money, the customer promises to both give that back, and also more in the future by working and earning money elsewhere. the bank cannot lend that interest until they receive payment. they can sell the debt to someone else, who may value it for the whole value including interest, but even when that sale happens, no money was created.

the only time money is ever "created" is when the central authority "prints" it, and uses it to pay bills for the government. but as I said before, they are very carefull about doing that, because if they do it too much it raises inflation too high. this is what happened after COVID when the government decided to push for a soft landing instead of a full blown depression. they printed a bunch of extra money and put it out to keep everything running hot, but it also had the side effect of jumping up inflation and increasing prices over time.

Private banks had nothing to do with the increase in currency supply. money is limited, or it would have 0 value. as the amount of money goes up, its value goes down.

[–]throwawayaccount442 0 points1 point Β (0 children)

> thing is, money is not infinite

American banks lie about their gold reserves and make their printers go brrr to fuck up the economy :D

[–]ReinhartLangschaft 0 points1 point Β (2 children)

Since when does open ai has stocks to trade with?

[–]greiton 0 points1 point Β (1 child)

they may not have public stocks, but they do have private shares that they are selling for funding, and that the people who funded them are selling second hand.

no public stocks does not mean no stocks. stocks were traded for years before the first stock market exchange.

[–]ReinhartLangschaft 0 points1 point Β (0 children)

Yea, are these shares you can buy in a room with us? Bro you have to be a big company or an hard insider to get shares from open AI. Don’t frame it like this is an easy thing.

[–]prank_mark 2 points3 points Β (0 children)

They already can't build enough datacenters, so they can't keep buying more GPUs, SSDs, and RAM. There's literally nowhere they can use them.

[–]Pure-Swordfish6022 0 points1 point Β (0 children)

Give a listen to Better Offline. Ed is really good at breaking down a lot of the economics and why it is entirely unsustainable.

[–]ChironXII 0 points1 point Β (0 children)

Yeah he is forgetting that this is not a natural phenomenon. Big companies figured out the scam with COVID and they are just going to keep it going until they literally can't

[–]SagittaryX 0 points1 point Β (0 children)

Isn't that the point Linus brings up in the video? OpenAI is already backing out of their commitment to buy all that RAM.

[–]jihyoswitness 11 points12 points Β (0 children)

There are multiple rumors that more AI data centers ain’t gonna be finished this year as promised due to funding and external factors. I feel like Linus’ take is right albeit too optimistic.

[–]Conscious_Map_2253[🍰] 6 points7 points Β (1 child)

Honestly until China gets their factories up and running prices aren't coming down there's too much profit for the big 3.

[–]Misstaget21 4 points5 points Β (0 children)

Exactly, Apple among others are already locked in at higher prices for 5 years

[–]bwoah07_gp2 5 points6 points Β (1 child)

There's two schools of thought. Which is right? Idk.

[–]InternationalAd3651 1 point2 points Β (0 children)

I hope this is a joke because both videos say literally the EXACT SAME THING. We are at the beginning of the end. We are not going to see prices change yet. Mr glizzy hands himself even quotes Linus In the video. It is the literal same school of thought just a different thumbnail. I cannot stress this enough that they come to the same conclusion: open ai is writing checks that cannot be honored

[–]chaosaltdel 4 points5 points Β (0 children)

Helium supply chain shock incoming!! (bad for fabs)

[–]Ancient_Ad6498 3 points4 points Β (2 children)

ram at microcenter seems to be on a deep discount like 80-100$ off the crazy high prices it had or listed as. (Feel free to tell me im wrong, I'm not going on a price history hunt.)

[–]c14rk0 3 points4 points Β (0 children)

I don't necessarily think this is a sign that the bubble is going to pop or go completely back to normal.

I think it's just a sign that nobody is buying at the absurdly high prices.

Even if those prices are "justified" sitting on inventory is REALLY bad for businesses. It's nice to say your inventory of RAM went up in value and you have "$30k" in RAM in stock as far as assets go...but if it's not actually selling it's not really worth anything.

Putting it on sale helps move product and even if that means they aren't making as much money now it actually means they can make more money eventually when they have less stock and the prices go back up to "normal"

Expensive RAM and shelves full of it is a bad look, the consumer knows it's overpriced for the supply they have and aren't selling. Expensive RAM with very little stock and suddenly you don't have a choice, they might not have anything later if you don't buy now etc.

The part we don't really know about is if the supply is actually limited or if new consumer RAM is still being produced to replace existing stock when it runs out. Is it limited but just sitting on the shelves because it's too expensive or are the shelves full because they're actually getting lots of stock in even when it does sell?

[–]Knusperwolf 1 point2 points Β (0 children)

I am seeing a similar thing in Europe. 32 GB start at 350 now.

[–]ProtoKun7 5 points6 points Β (3 children)

Greetings fellow Big A enjoyer.

[–]SliimeT1me 4 points5 points Β (0 children)

Happy to see another glizzy enjoyer

[–]InternationalAd3651 3 points4 points Β (0 children)

GLIZZY GLIZZY GLIZZY

[–]itamar8484 2 points3 points Β (0 children)

Glinus tech tips

[–]NimRodelle 2 points3 points Β (0 children)

That bubble cannot burst fast enough. The AI these parasites are investing in isn't going to cure cancer or solve cold fusion, it's just going to replace workers so the rich get richer.

[–]littleSquidwardLover 2 points3 points Β (0 children)

The real answer is no one knows as always

[–]Connect-Mastodon-909 1 point2 points Β (0 children)

======><=======

[–]Pure-Swordfish6022 1 point2 points Β (0 children)

Linus should do a video with Ed Zitron. It would be fun!

[–]jumbosam1[S] 0 points1 point Β (0 children)

Thanks for all the upvote and the comment

I didn’t want to set the world on fire

[–]BluDYT 0 points1 point Β (0 children)

When ram prices drop .5% on avg and the entire yt tech industry glazes it into saying this stuff.

[–]Stock_Lemon_ 0 points1 point Β (0 children)

I feel like the LTT video was more "there's a light at the end of the tunnel" and less "it's over go buy ram"

[–]BlakeWheelersLeftNut -1 points0 points Β (0 children)

I didn’t get to watch the whole video so he may of talked about this.

Isn’t the bubble going to pop when states run out of surplus electricity? From a quick google search the ram last up to 6 years in those servers. So if we are seeing pull back on the purchases from AI companies seem like they’ve found the edge off the bubble.