| ▲ | JumpCrisscross 2 hours ago |
| > If this is a bubble... The pop stage will be devastating... Why? It could be sudden. It could be slow and gradual. I've seen no reason it needs to be one versus the other. |
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| ▲ | burnte 2 hours ago | parent | next [-] |
| Irrational exuberance rarely transitions to a rational drawn down. The minute the first selfish-actor flood-liquidates, everyone else will too. That's now runs work. |
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| ▲ | bawolff 30 minutes ago | parent | prev | next [-] |
| I mean, isn't the definition of a bubble that it pops quickly? If it slowly loses value over time, its not really a bubble. |
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| ▲ | JumpCrisscross 27 minutes ago | parent [-] | | > isn't the definition of a bubble that it pops quickly? There is no consistent definition of a bubble. We have no fundamental reason current valuations have to collapse suddenly. | | |
| ▲ | bawolff 22 minutes ago | parent [-] | | Is there any definition of bubble that doesn't involve popping? That's literally the metaphor. > We have no fundamental reason current valuations have to collapse suddenly. I would agree, but i think that is just saying that the current situation is potentially not a bubble. Which may be true. We will only find out after the fact. |
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| ▲ | tomrod 2 hours ago | parent | prev [-] |
| Because it is deliberately extracting cash from Mom and Pop into the robber baron's wallets? |
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| ▲ | JumpCrisscross 2 hours ago | parent | next [-] | | Okay? Why does that mean a devastating pop? | | |
| ▲ | vermilingua 2 hours ago | parent | next [-] | | Where were you in 2008? | | |
| ▲ | JumpCrisscross 2 hours ago | parent [-] | | It would be karmic if fleecing led to financial crises. It doesn’t. You’ve taken N = 1 and extrapolated it wildly. |
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| ▲ | michaelmrose 2 hours ago | parent | prev [-] | | Because traditionally the pop is delayed while those who realized most of the gains attempt to offload the risk to other parties. Whether this works or not at some point it becomes an inevitable and self reenforcing feedback loop. Just investing less in risky things on the run up means you personally perform worse so even in known bubbles you don't see reasonable slow downs instead of disastrous pops. | | |
| ▲ | JumpCrisscross an hour ago | parent [-] | | > traditionally the pop is delayed while those who realized most of the gains attempt to offload the risk to other parties What? Source? Plenty of investment bubbles pop before the bag is passed. This thread involves a lot of people looking at something they don't like and presuming karmic forces will give them what they deserve. There is no reason these companies, even if massively overvalued, have to "pop." That's fundamentally different from e.g. the financial crisis, or the 2023 bank collapses, or even the dot-com bubble. Those did not have the ability to self correct. There was no slow deflation other than through a bailout. | | |
| ▲ | overfeed 8 minutes ago | parent | next [-] | | > There is no reason these companies, even if massively overvalued, have to "pop." This is a wild thing say without any qualification. | |
| ▲ | marcus_holmes an hour ago | parent | prev [-] | | I'm genuinely curious why you say this is different from the dot-com bubble? As I see it, this is the exact same situation - wildly overvalued companies based on investor exuberance, the underlying business is not capable of supporting this kind of valuation. IPO tends to be the crunch point at which this overvaluation is exposed. Once exposed, the valuation correction spreads to other similar businesses quickly and the bubble pops. What's the self-correction ability that AI companies have? | | |
| ▲ | JumpCrisscross 28 minutes ago | parent [-] | | > genuinely curious why you say this is different from the dot-com bubble? A lot more revenue. Dot coms were going public pre revenue. And Anthropic is profitable. Both it and SpaceX wouldn’t be dependent on further stock sales to stay alive—that lets them weather a downturn. | | |
| ▲ | marcus_holmes 9 minutes ago | parent [-] | | As I understand the situation, Anthropic is revenue-positive but not profitable. As usual, Ed Zitron covers this well [0]. As with the dot-com bubble, there is a lot of voodoo accountancy (and flat-out lies) about the actual situation here. As I understand it, the basic problem is that the big three can't charge enough per token to cover costs because they're in competition with each other (and one of those is Google that can afford to buy market share using its other operating revenues), and the OSS/cheap Chinese models. And this situation is unlikely to get better in the short term because building cheaper per-token capacity is very expensive and time-consuming. [0] https://www.wheresyoured.at/anthropics-profitability-swindle... |
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| ▲ | dragontamer 2 hours ago | parent | prev [-] | | Why would that pop the bubble? Robber Barrons existed from like 1860 through 1915 and extracted the wealth of many people, including Native American tribe lands. Like this shit can keep going until we decide enough is enough and actually change our society. | | |
| ▲ | tmp10423288442 2 hours ago | parent [-] | | Not related - many robber barons went bankrupt in the severe economic crashes of the time, such as the Panics of 1873 and 1893. The Gilded Age continued despite bubbles popping. |
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