Previously, I thought investing in AI companies would be a good hedge against AI taking my job, but I hadn't considered the possibility that they fund the build out by issuing shares. Is there no reprieve?

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qeternity 5 hours ago | parent | next [-]

The shares you own (usually) give you voting rights. Whether that makes any difference is another story.

But I'm not sure what people think the stock market is for? It exists primarily so that companies can access capital markets namely by issuing their own shares.

Historically for companies that were growing rapidly or had large capital needs, private markets weren't large enough to handle that. Times have changed, but the whole point of going public is to be able to raise capital by issuing shares.

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program_whiz 6 hours ago | parent | prev | next [-]

maybe not. There could be mass unemployment and all the big dogs could also lose from the buildout while smaller players (non-public) take over. It could be a lycos / yahoo / google situation where there was no "winner" to invest in during the initial dotcom crash, and there was large-scale disruption all the same.

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Terr_ 5 hours ago | parent | next [-]

I'd like to note that "the sector which employs you" should be considered when talking about diversifying. (In general, not only when worried about the Robot Takeover.)

A long stretch of unemployment can be weathered by selling a bit from strong investments, and a crashing stock-market can be waited-out by staying firmly employed, but both simultaneously is what can force people to "sell low" just to pay regular expenses.

	▲	5 hours ago \| parent [-]
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arisAlexis 6 hours ago | parent | prev [-]

The dotcom crash has nothing to do with the AI build out

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everforward 3 hours ago | parent | prev | next [-]

I’m not actually convinced they’re a good hedge because the market cap seems to presuppose a lot of success.

Phrased differently, I don’t see how these companies could grow their equity like Google or Amazon did way back when without having full AGI and changing the entire world. They would need to become worth more than the entire world’s current GDP added up.

There’s a big range on the spectrum where AI does well enough to mess up your life but not well enough to make you even moderately wealthy.

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staticman2 5 hours ago | parent | prev | next [-]

Theoretically hedging would only work if the A.I. firms are not already priced for taking your job, right?

I have no opinion on whether they are.

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boshalfoshal 4 hours ago | parent [-]

I think they are actually underpriced relative to "taking away" jobs. I personally believe ant at 1-2T is pretty reasonable if you consider claude to effectively be the "best devtool of all time," aka it literally writes all software for you.

I think (somewhat arbitrarily), to get to higher valuations, you are going to have to disrupt more than just the software business. Which is what most labs are trying with finance, biology, chemistry, law, etc. That might be enough for a few hundred billion in TAM more.

I think to get to a ~5T+ valuation, then we have to start thinking about AI meaningfully displaces classes of jobs, maybe in the single digit %'s. As in, _global_ SWE headcount starts going down, but revenues for software companies as a whole go up.

I think for ~10T+, you definitely need meaningful job displacement across most white collar sectors.

	▲	staticman2 4 hours ago \| parent [-]
		Claude is in (potentially) a price war and research and development arms race with OpenAI and Google, and potentially other labs, so I don't think it's necessarily a given to price it as the company with the "best devtool of all time".

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BigTTYGothGF 6 hours ago | parent | prev | next [-]

Not for people like us.

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arisAlexis 6 hours ago | parent | prev [-]

It actually is but very few people realized that yet. We are still at "it doesn't work it's a fluke" denial phase