Ponzi scheme actually...as they entice/force institutional investors via algorithmic investing (like Musk just did with SpaceX) who entice small investors into the market. Remember there is no actual revenue from AI- ChatGPT says it won't make money until 2030 at the earliest...it's NOT AN ACTUAL BUSINESS YET! Remember the Silicon Valley tech bust of 2001? The Subprime great recession of 2007-08? The GameStop short squeeze of 2021 BECAUSE BIG INVESTORS KNOW THESE ARE BAD DEALS FROM THE START
No no no, pyramid scheme is different to money laundering fraud. Pyramid scheme entraps people into buying a product in a means to offload products but often supplier over delivers and requires compensation in a weird debt loop.
This ^ is more like the three stooges bit of hey you owe me 10 well here's 5 and I'll owe you 5, where everyone is in mutual debt to everyone else and money changes hands but at the end no one is richer for the experience. Except there is way more promising involved.
And for those interested, he's started doing some long form content on YouTube. I've been enjoying the 50 minute videos on a topic, rather than the 50 seconds.
I quit a dot.com the day I realized they were paying other companies in their stock, and accepting other companies' stock for their services. Was told I didn't understand "the dot.com economy".
Month later when it all imploded and I was at my new job got a call from the old CFO; "WHAT DID YOU KNOW?" Well Hal, I guess I understand the dot.com economy.
Then I hung up. I was paid in cash, not stock. Turned out to be a good idea.
If you have stocks in any AI company, it's just about finding the right time to sell. AI *will* burst. It won't disappear completely, but it'll take a long time to get back to pre-burst levels.
My guess is that these companies are planning on dumping money into AI for years. Data centers take years to build, and a lot of the contracts for parts seem to be long term commitments too.
My guess is that AI has at least another year, possibly two or three, before the bubble bursts.
It's not a pyramid scheme. A pyramid scheme is a system where you get money for signing people up to sell for you. You recruit 3 people, and those 3 people recruit 3 more each, and people are sending money up the hierarchy. That's not what's happening with ai. Just because it's a scam/fraud doesn't mean it's a pyramid scheme.
To the stockholders and executives, the only thing that matters is that the line keeps going up and to the right until they can get their golden parachute/sell their shares and leave some other sucker holding the bag when it all collapses.
Everything and everyone else can get fucked as far as they’re concerned.
Yes, I agree and great meme….. but also only letting people know, because I’m a math guy, NVDA prices didn’t just fall…….. Look at that piece of shit, it’s still all the way up there.
Even after Enron, it still keeps happening. In the US, companies keep profits, but losses get government bailouts. But same folks are currently waving the Communist boogeyman flag around (seriously, do the Republicans do ANYTHING that doesn't require fear-mongering?). Hell, most Americans don't know what to do with themselves without someone to hate on.
The sad part is Enron got in trouble bc they lied about it with cooked books. Current companies get awsy with it as long as they make the math work out on their books and are honest about it.
Big tech companies are only hiding over a trillion in investments by offloading them into shell companies they are "partnering" with to build data centers. What could possibly go wrong
dixxienormus
There's only one way from here - down the gurgler
SomebodythatIusedtonope
michaelfire
Ponzi scheme actually...as they entice/force institutional investors via algorithmic investing (like Musk just did with SpaceX) who entice small investors into the market. Remember there is no actual revenue from AI- ChatGPT says it won't make money until 2030 at the earliest...it's NOT AN ACTUAL BUSINESS YET! Remember the Silicon Valley tech bust of 2001? The Subprime great recession of 2007-08? The GameStop short squeeze of 2021 BECAUSE BIG INVESTORS KNOW THESE ARE BAD DEALS FROM THE START
TheNoirAntagonist
No no no, pyramid scheme is different to money laundering fraud. Pyramid scheme entraps people into buying a product in a means to offload products but often supplier over delivers and requires compensation in a weird debt loop.
This ^ is more like the three stooges bit of hey you owe me 10 well here's 5 and I'll owe you 5, where everyone is in mutual debt to everyone else and money changes hands but at the end no one is richer for the experience. Except there is way more promising involved.
DubhIainn
Its also why the USA has such a high GDP, money gets passed around for all sorts of "services" at stupidly inflated prices.
petonious
Japan in the 90's. US in the early's. Same old stuff. Get rich. Get bailout.
TheVillageGrouch9000
https://media1.giphy.com/media/v1.Y2lkPWE1NzM3M2U1dnJhMHNya3ozOXB1anZyaThlY3l0NWl0M2RkaWFlcGdqNmt0Z2pybSZlcD12MV9naWZzX3NlYXJjaCZjdD1n/gIqusaeYxgSiY/200w.mp4
00110001001110010011100000110100
"Don't say Pyramid, just call it a reflecting pool."
stmiba
You should credit the creator: Chris Kohler
Whiskers7
And for those interested, he's started doing some long form content on YouTube. I've been enjoying the 50 minute videos on a topic, rather than the 50 seconds.
lightfoot2
I quit a dot.com the day I realized they were paying other companies in their stock, and accepting other companies' stock for their services. Was told I didn't understand "the dot.com economy".
Month later when it all imploded and I was at my new job got a call from the old CFO; "WHAT DID YOU KNOW?" Well Hal, I guess I understand the dot.com economy.
Then I hung up. I was paid in cash, not stock. Turned out to be a good idea.
OperatorWay
> lightfoot2 : "...when it all imploded and I was at my new job got a call from the old CFO; 'WHAT DID YOU KNOW?'..."
"I knew some common sense."
Yet another example of grossly incompetent "eXeCuTiVeS."
lightfoot2
Sort of. I remember when FTP software imploded, this was not my first rodeo.
HeresYourSauce
If you have stocks in any AI company, it's just about finding the right time to sell. AI *will* burst. It won't disappear completely, but it'll take a long time to get back to pre-burst levels.
My guess is that these companies are planning on dumping money into AI for years. Data centers take years to build, and a lot of the contracts for parts seem to be long term commitments too.
My guess is that AI has at least another year, possibly two or three, before the bubble bursts.
lightfoot2
Get out now while the getting is good..... I pulled most of my money out of the US markets as they're basically rigged at this point. Thanks but no.
allergictocantaloupe
It's not a pyramid scheme. A pyramid scheme is a system where you get money for signing people up to sell for you. You recruit 3 people, and those 3 people recruit 3 more each, and people are sending money up the hierarchy. That's not what's happening with ai. Just because it's a scam/fraud doesn't mean it's a pyramid scheme.
youreathing
Ironically, the same people calling this a pyramid scheme are the ones that are calling anything remotely related to computing "AI."
itsokimaussie
Ok Michael...
Subtilico
They pump around money in a tiny circle, while framing it as a great opportunity, trying to draw in more money from lots of fools.
NaluBoy
So, in other words - a circle jerk?
Subtilico
And if you try to enter, you get screwed.
PoliticalWanderer
To the stockholders and executives, the only thing that matters is that the line keeps going up and to the right until they can get their golden parachute/sell their shares and leave some other sucker holding the bag when it all collapses.
Everything and everyone else can get fucked as far as they’re concerned.
Isorikk
I'd be really concerned if it went left since it's a function over time
AgentTasmania
Give it a few more years and the line going left will be the minimum expectation of growth acceleration.
OperatorWay
"Privatize the gains & socialize the losses."
ChareAndFlaff
All these companies when the economy craters
PineappleLoopsBroether
Yes, I agree and great meme….. but also only letting people know, because I’m a math guy, NVDA prices didn’t just fall…….. Look at that piece of shit, it’s still all the way up there.
unicorncentaur
“Super easy. Barely an inconvenience.”
lifeisadadjoke
Even after Enron, it still keeps happening. In the US, companies keep profits, but losses get government bailouts. But same folks are currently waving the Communist boogeyman flag around (seriously, do the Republicans do ANYTHING that doesn't require fear-mongering?). Hell, most Americans don't know what to do with themselves without someone to hate on.
sadurdaynight
The sad part is Enron got in trouble bc they lied about it with cooked books. Current companies get awsy with it as long as they make the math work out on their books and are honest about it.
Antrobus55
It's called the Republican business cycle. Happens roughly every ten years, regular as clockwork.
Asadsadsadclown
Funny thing about Enron.... https://finance.yahoo.com/technology/ai/articles/ai-sector-enron-sector-111500396.html
fartyandbloated
I saw a different article about this off balance sheet debt that didn’t make the connection and immediately thought ooh, Enron again!
Asadsadsadclown
Big tech companies are only hiding over a trillion in investments by offloading them into shell companies they are "partnering" with to build data centers. What could possibly go wrong
fartyandbloated
The Smartest Guys in the Room (about Enron) is my favorite book. I can’t tell you how many times I’ve read it.
TheSecondPiewackit
I have the movie on DVD. It was one of the first ones I bought.
TrumpRapesAndEatsChildren0002
why not?
yn7jy8s84v7
I just picked up the audiobook after reading your comment.
fartyandbloated
Nice! It’s truly fascinating. Frustratingly the CEO and CFO are both out of prison now but they did serve time, 12 and 6 years respectively.
Happy listening!
yn7jy8s84v7
Thank you!