The AI Bubble Monitor(cepr.net)
51 pointsby mooreds3 hours ago14 comments
  • solyin2 hours ago
    > I have a lawyer friend who pays $20 a month for an Anthropic system.

    I have a lawyer friend who's seen a dip in clients reaching out. Turns out, they're having Claude draw up contracts.

    • pizzafeelsright2 hours ago
      Low end - absolutely.

      High end? Not yet. Corporate contracts are getting human only oversight with us. We have tried to compare but found that the signal vs noise generated doesn't compete with our expensive legal department.

    • arealaccount2 hours ago
      Or probably even moreso - reviewing contracts
    • bluefirebrand2 hours ago
      I used Claude to help me draft some letters to negotiate severance after I was laid off. It was really useful and I did manage to get a bit extra from my former employer

      We're going to be in for a really rough time as more and more stuff gets replaced by AI and it becomes harder for people to earn incomes

      • RankingMember2 hours ago
        Soon it'll be your AI message going to an AI on their end making the severance call with no human in the loop (if it wasn't already!).
    • soco2 hours ago
      I have a lawyer friend who receives Claude contracts for drafting. Oh dear, the level of bullshit they find, apparently quality is classes below vibe coding. But as long nobody checks...
      • scrollop2 hours ago
        Maybe they're using the free version...
  • etempleton2 hours ago
    The article asks the 25 trillion dollar question. ‘What is the near term demand for AI?’ And the answer is nobody knows; especially not these companies. I think the bubble is almost inevitable. Everyone is racing to gain market domination as they see it as winner take all, but it just doesn’t appear to be shaking out that way. There are five very competent US based models alone and then I don’t even know how many open weight models. Unless the industry coalesces around 2-3 models soon I don’t think anyone makes any money on this in the next 10 years+.
    • airstrike2 hours ago
      There's no real incentive for the industry to coalesce around 2-3 models. I think it's very unlikely to happen.
      • arealaccount2 minutes ago
        It could be like the last SOTA lab to run out of money wins
      • pizzafeelsright2 hours ago
        Nobody wants to admit that while partial to one company or another, brand and all that, I highly doubt that within 1-2 years we can tell the difference between model output for 90% of our tasks.

        Except for the 'vibe' of some of the models with their writing or testing style I am not certain I could tell you which model is which unless asked.

        Switching from model to model at the moment has been seamless without extensive 1 to 1 bench-marking but most of my tasks are never 1 to 1.

        • etempleton2 hours ago
          Completely agree. And for companies, if things are that indistinguishable, it is going to come down to cost and enterprise security / privacy. Sure companies will be slower to switch, but they will. It will be a race to the bottom.
      • Zambyte2 hours ago
        Training is expensive. That seems like an important incentive.
      • etempleton2 hours ago
        I agree. Which is why I think the bubble is going to pop in the nearish term.
  • _air2 hours ago
    ”China’s bubble already collapsed, leading to a plunge in its AI-tech index of 40 percent” This was news to me, is there any good coverage on what happened?
  • ramon1562 hours ago
    the only realistic demand is see is similar to why Azure, digitalocean etc are still breahing. There are incompetent companies that cannot live without certain services, so they'll stay dependent. A lot of companies are doing agentic engineering, and the rat race is even stronger there. You need a product that is better than a vibe-coded app, but you aren't competent enough to get there. These companies are going to die out at some point, and what will be left is the better half.

    Even that won't make back the 3 trillion that is needed.

    • pizzafeelsright2 hours ago
      From what I am seeing about 10% of our AI spend has any ROI. You can count 90% loss of $XX but the ROI we get from that 10% is 200%-10000% of our spend.

      Getting and retaining customers is 99% of profit which is why sales, marketing, advertising, and creativity is always in high demand. After that, quality.

  • ndom912 hours ago
    Shameless self-promotion: https://artificialliabilities.com for a nice story-like AI infra overview. Based of FRED, SEC, and other publicly available data.
  • dudeWithAMood2 hours ago
    Given the debt and deficits the government is running I worry they're not going to haveh te financial muscle for a rescue package when this implodes.
    • hughw2 hours ago
      Not a problem if the govt takes back the minting of money from the Fed.
  • SubiculumCode2 hours ago
    Doesn't the title presuppose the outcome?
  • xnx2 hours ago
    Some great charts in there that emphasize how absolutely ridiculous SpaceXS(?)ITesla is.

    My take on "bubble" activity from HN chatter: https://www.alwaysleaveanote.com/hacker-news/bubble-talk/

  • crisleo942 hours ago
    AI solves problems that do not exist, it creates problems and then promise to solve them, that's why there's neither a market for them nor any profit.
  • rowdyranga2 hours ago
    The AI companies are assuming that there will be demand in the future for their products. That is why they are trying to scale up to meet the demand.
    • dspillett2 hours ago
      They are hoping rather than assuming because if there isn't sufficient demand (sufficient paying demand, not people who wouldn't pay just using it for free because they can), there is no way back for them that isn't an amusingly catastrophic collapse, and they are scaling up as if the demand is a forgone conclusion because it just isn't worth trying to plan for the other option.
      • StilesCrisisan hour ago
        That's true, but it seems like Anthropic actually has been capacity-strapped fairly often this year.
  • thinkcontext2 hours ago
    The author, Dean Baker an economist at a non-profit policy group, called the housing bubble. Not wealthy, he sold his condo in 2004 and bought a house in 2009.
  • Gseries002 hours ago
    Yes the AI bubble is real, but the good things is, it is expaning like an unverse which has enourmous posibilities. I could has said that it will burst soon but after LAYA and JEV, we all are going to witness the lots of changes.
  • deadbabe2 hours ago
    The stages of AI bubble are basically like this:

    1. Denial: “No way these companies are worth anything. Zero profits.”

    2. Anger: “Idiots! This will end like the 1999 dotcom crash!”

    3. Bargaining: “Ok maybe if it goes lower I’ll… I’ll buy!”

    4. Depression: “It just keeps going up…”

    5. Acceptance: “I missed out, it was so obvious, now I’ll just buy in.”

    • rootusrootus2 hours ago
      That right there is a pretty good demonstration of the alternative position. "This time is different."
  • stockpearl2 hours ago
    [flagged]