Hacker News Reader

Comment by swatcoder | Hacker News Reader

Railroads, semiconductors, plastics, networking... the utility was there for all of them, and so was the potential profit.

Everybody knew it.

But some investors don't have the patience for these "sure things" to mature into their commercial destiny and others know they can siphon off a killing by taking advantage of them as they speculate.

These bubbles aren't about potential, they're about timing.

And today's AI, for as revolutionary as it may be, is taking just as long to mature as anything in the past.

Most of the top players involved in AI right now are going to be rich. And in 20 years, the world is going to involve a lot of AI in soooo many things. But a lot of shirts are going to be lost below those top players and a lot of companies are going to fold because infrastructure, refinement, and integration take time while the FOMO speculation starts as soon as the big discovery is recognized.

View on HN

> Railroads, semiconductors, plastics, networking... the utility was there for all of them, and so was the potential profit.

Canals... where a repeating pattern was the company underestimating difficulty/costs, and going unrecoverably into debt. Another company, which then bought the largely finished canal, cheap, they had potential profit... until tech change (railroads).

Capital cycle theory: https://www.youtube.com/watch?v=2J2Fb1bBufA&t=577s

Also, (setting aside Standard Oil’s business practices), this is a common meme in oil exploration historically, and even today. Early prospectors were honestly pretty stupid, and their principal differentiation was risk tolerance.

There a lot of parallels with AI…it doesn’t take a genius to see the long-term potential, but the risk is in implementation, so it’s a mad rush to the finish line by a wide variety of less scrupulous early players. Rockefeller got his big start by sweeping up failing producers who were all capital weak, and I’m sure something similar will happen here during the inevitable bust.

I can do the hard, risky work of drilling wells / deploying AI, or I can sell you a vision of that future, today. The most dangerous technologies in terms of grifting are the ones that everyone can understand.

> Another company, which then bought the largely finished canal, cheap, they had potential profit... until tech change (railroads).

Absolutely right. Somebody may buy the DCs. The tech changes very very fast, the DCs may be entirely worthless. US has high energy costs, it can never be cost competitive.

Why Data Centres Will Change the World and Bankrupt Their Builders — John Hempton https://www.youtube.com/watch?v=GY5YyPLfqp0

Useful (like solar, airlines, fiber), but it won't be profitable. High capital cost, low marginal cost, subject to competition and with technical improvement --> these four factors guarantee businesses will never be profitable, and they go bust.

“When the dot-com bubble happened, it was largely driven by companies that couldn't turn a profit or had P/E ratios in the hundreds. I'm not going to pretend that I'm an expert on financial bubbles, but I've never heard of a bubble where the companies involved had such a modest valuation based on their earnings, even if their earnings (and therefore their evaluations) are enormous.”

Do you know the situation with rail, canals, etc?

Railroads had some of the same issue encountered by the dotcom bubble, and in particular dark fiber: Overcapacity.

Once railroads where demonstrated to be (extremely) profitable, people kept building them even if the existing demand was already met. The exact same thing happened with dark fiber (looking at you Enron).

AI is a bit different in the sense that the capacity can be used for research, and more importantly is not bound to a specific connection (between locations), and therefore a lot more fungible.

Not sure about canals, but while I think there are issue with current AI investments, I would not conflate them with the railroad bubble on this basis.

AI is a bit different in that unlike the rail tracks and the dark fiber the data centers arent actually going to be finished. It's much more of a stranded asset - there will be piles of chips and 1/4 finished construction projects, not usable assets.

No doubt somebody will use the assets for something but it's still wildly more wasteful than either railroads or dark fiber.

You don’t think there were half-finished rail lines abandoned when the companies ran out of money?

Not at all. There were plenty. They were just a lot more salvageable.

The UK has even higher energy costs and people seem to want to build data centers here? (Or at least they say they do - looks more like land speculation to me):

https://www.globalpetrolprices.com/map/electricity_industria...

Because European countries are politically stable and are under the rule of law. Things that are rather priceless and can't be bought with money.

Those drones hitting high-rise hotels in Dubai were rather eye opening.

I agree with your point about rule of law, but let’s not gloat too quickly about nasty SA getting its comeuppance. It’s going to look pretty ugly in Europe when Russia follows through on its potential to disrupt or destroy critical infrastructure. We are pretty vulnerable too.

the UK is stable? economically it's falling pretty hard and the governments seem to be a revolving door

The UK has got a huge amount of wind power that can be purchased ahead of time at better rates than listed in that table, it's also got some bottlenecks with power distribution (especially between Scotland and the rest of the UK) which will take years to fix so there area areas where decent power contracts can be had for customers who can build out fairly quickly (datacentre operators with large power requirements).

"The UK has got a huge amount of wind power"

Very little wind today here in Scotland and for most of this week - which is a pleasant change I guess...

Oh look! A bird!

Weather is not climate. A datum is not data.

The UK has way less cheap wind than the US has cheap hydro. Let alone cheap solar.

People want to do all kinds of idiotic things which make no sense. We've had excess compute/gpu since 2010. People didn't know what do with all that excess and started bitcoin and tens of thousands of crypto, followed by NFT. The claim was crypto will solve all problems, which hasn't happened. Now, everyone moved on to AI, AI will do this, that and everything else and also take away all your white collar and creative jobs.

Even third world countries like India which can't provide basic services to their citizens, have no water, no power, no sanitation or cleanliness are giving hundreds of billions of dollars in incentives (land, power, water, tax subsidies) to hyperscalers, to create at most 2.6 jobs. Google clearing land to build India's largest data centre: https://www.youtube.com/watch?v=dBJPf6Pxfvs

> The UK has even higher energy costs and people seem to want to build data centers here? (Or at least they say they do - looks more like land speculation to me):

There is no meaning to what politicians and crony capitalists do. It is all lies, theft and grift.

The island where residents fight data centres for water: https://www.youtube.com/watch?v=WuToaVyWmL4

The reality here in the UK does not always match the ambition though.

https://www.reuters.com/business/media-telecom/microsoft-pul...

Both our high energy prices and the current capabilities of our energy distribution network relative to the renewable generation and storage capacity we are trying to move towards are significant barriers.

> US has high energy costs, it can never be cost competitive.

A non-trivial percentage of that is artificial.

When push comes to shove and enormous profits (and anything remotely resembling national security) are at stake, the US is decent at removing artificial problems.

You've already seen a ton of that related to chips and data center build outs.

Why is solar more expensive in the US than China? Mainly tariffs. Same for batteries.

Why is nuclear more expensive in the US than South Korea? The government.

Why is SMR never going to beat conventional nuclear if you remove artificial problems? Physics. Though specialized applications will be viable with SMR.

Restaurants and bars!

This pattern repeats across many industries with large up-front costs.

I'm reminded of vertical hydroponic farming in old silicone fabs in Japan...

https://www.japantimes.co.jp/business/2026/07/09/companies/p...

> Most of the top players involved in AI right now are going to be rich.

Almost all the "top players" in the dot-com crash died or lived on in relative poverty; only Google and Amazon turned out "very rich".

The Yahoo founders left with never-fly-commercial money before re-joining the billionaire club by investing the money they had. Others that survived post-IPO include eBay and Dell.

There were high profile failures but we have had those recently too eg. pet.com (dot com) and color.com (post-dot com, domain has since been repurposed)

> The Yahoo founders left with never-fly-commercial money before re-joining the billionaire club by investing the money they had.

I think you're confusing people cashing out with actually creating a successful company. Yahoo is not what people would describe as flagship company, or pets.com or Ask Jeeves or myspace or Voat or whatever. The dotcom bubble made a lot of people rich, but most examples were at expense of bag holders.

No successful company is on top forever. Just take a look at the top companies 20 or 30 years ago: where are they now? Nowhere near the top.

Yup, if you google what founders in those 'failures' did was that they pretty much jumped vc side or founded more companies and have had very successful career. Not mind boggling like Bezos or Brin but still very cool career.

taking the money and running is the dream of the VCs

if you believe the milton friedman approach to economics, a company has no other value in that what it can provide to the owner (shareholder)

take your millions while it burns and, as the parent said, never fly commercial again

For a VC "running" would mean re-invest in the next thing to get more money. What alternative would you prefer? Keep doing the same thing without investing in new stuff?

They don't "take the money", there are other people that believe some things (profits/growth in a field) will last forever and will bring 10x return, so they are willing to give them the money.

You are the one confusing what success is.

If you go by current standings in the market, yes, Yahoo is no longer at the top. Yet Yahoo was one of the most valuable and influential tech companies in the late 90s, early 2000s.

eBay, Priceline (now Booking.com) did very well too

It would be hard to make a list of things we forgot about because they failed 30 years ago

I know numerous multimillionaire dot-com techies. I guess they're not "top players".

Wait. Are you talking companies, or people? Companies come and go. They are replaceable virtual containers for people. I don’t think it’s appropriate to apply the term “poverty” to companies.

A large number of companies failed in the dotcom crash, but the founders did pretty well if they'd made it to an exit event. Don't forget that it was a stock market bubble imploding. The founders and early employees had already sold shares in the IPOs that put the companies on exchanges. It was the investors who bought stock that lost money.

The after effects were that it was virtually impossible to raise capital for a while afterwards, so the next round of founders struggled. But then interest rates went to practically zero and money got cheap so it was all good.

The founders doing well is not mutually exclusive to the overall crash as experienced by the public. Also, a lot of founders are doing well even before they take on a venture. 8/10 founders from successful high growth startups self report as middle to upper-middle class background and 50%+ have elite education from top 10 schools.

You're right, the broad market drags down all retirement savings and those who are about to hit the age of 60+ pay most dearly.

Mark Cuban?

Jim Cramer lost big but has continued spouting nonsense ever since pretty successfully

You should check out the fundamentals of all those businesses; quite different. AI might be closest to a railroad based on these Capex outlays, and like railroads and other utility businesses the margins are thin and paybacks long. We wouldn't have Microsofts and Googles at 3% a year, so OpenAI and Anthropic are going to need something else to support this level of investment and speculation.

> AI, for as revolutionary as it may be, is taking just as long to mature as anything in the past.

That's an interesting claim but it needs support. How are you comparing their maturity rate? AI is arguably maturing very fast.

Another argument in favor of the AI build out, usage of the data centers is not geographically bound like the other technologies considered. A datacenter in Cheyenne WY can be used by the entire continent. They are not even bound to AI usage.

Its profitability ain’t.

>But a lot of shirts are going to be lost below those top players and a lot of companies are going to fold because infrastructure, refinement, and integration take time while the FOMO speculation starts as soon as the big discovery is recognized.

Another reason is that the way we find out what works and what not is through experimentation. Especially in a transformation like this it’s impossible to predict which configurations will work and which won’t.

> they're about timing.

Yes. And valuation. I think the leading frontier labs will be fine in the long-run and NVidia will be fine. Some of their investors who bought at too high of a valuation, expecting to flip it in too short a time frame will lose a chunk of their money when they have to sell for less.

The hyper-scalers in the middle are the most vulnerable. They borrowed billions at increasingly high rates to lock up GPU and power capacity. They are 'ground zero' of a lot of the 'circular money' deals. Big banks who financed hyper-scalers initially, expecting they could package that debt up and sell it on to diversify, are already struggling to find buyers for the debt, causing its value to drop, which then forces the banks to cover with more collateral, and that's how the snowball starts down the mountain.

Wait... with hyper-scalers, we are talking about Google, Meta, Amazon, Microsoft, are we not?

And do these not all have established business models that are ridiculously profitable, and huge cash reserves?

How the heck are THEY vulnerable, and the "bare" frontier labs like Anthropic and OpenAI with no preexisting business models or profits, but equally ridiculous borrowing are supposedly not?

I think it was implicitly assumed that one or more of those would fail. The main question is, who else?

I don't think they are talking about the ones you listed, but companies like CoreWeave.

Google, Meta, Amazon, MS have huge cash-producing businesses they can just fall back on. Of course the stocks will get hammered in the short term, but they are still sitting on cash volcanos.

Pure AI plays are what are most at risk. In the bad case, all the CoreWeave type companies have their assets acquired on the cheap by the existing big players. In the armageddon case, companies like Anthropic and OpenAI also end up in the discount bin.

Coreweave & co are neoclouds.

Hyperscalers are FAANG.

Your logic is backwards.

NVIDIA will take a huge hit and we will probably end up with anti circular financing laws.

Frontier labs are losing money and are most likely to go bankrupt and be absorded by bigger companies.

Hyperscalers will take a huge beating but they are ultimately profitable and they already control the frontier labs. So after a hard crash they will be fine. A lot of their debt is actually offloaded onto pension funds, insurance companies, etc. Those risk bankruptcy.

They will be just fine. They might not see the astronomical price margins of the current bubble, but there is a lot of untapped demand that is curbed by current mem/GPU prices and if they go down the demand will rapidy grow.

Agreed,

I believe AI is here to stay as general concept turned into practically working implementation.

What that practicality means is we all who consume AI are learning but we're still in the early adopters phase of all that.

Of course AI companies invest a lot and try to stay on top of the traction but I also believe not all of them will survive test of time.

I personally believe that a lot of over investment in data centers and supply of energy will be burnt and will have to be reinvested somewhere else when technology advances enough to "miniaturize" AI enough so it won't require couple of football fields to provide what it does today.

I do believe cloud based AI will be always attractive to small business if price is right and to big enterprises so they don't need to invest inhouse for the scale they need, but that will be sort of alliance based enterprise B2B market.

anything between (including me for the scale I represent business wise), I can't wait until I will be able to buy appliance from 12 to 48U maximum that can do all what me and my company needs AI wise as local AI.

moment subscriptions become equally expensive as pay as you go models, I switch to mac studios with 96GB and reasonable weighted models that will be specialized in something instead of one LLM/AI to prompt everything to it and hoping it can address all sort of problems as one solution.

AI one day must fly to space, be called Mother and discover aliens. it can't be 6 football fields as physics won't let it take off. It must be one day small enough so we all can have ChatGPT 6.1 medium model at home without subscription, just as fixed price with TCO over lifecycle of the whole appliance (software + hardware together)

that may become a drama to many companies that apparently may not be worth trillions unless they diversify enough its AI offering.

> AI one day must fly to space, be called Mother and discover aliens.

We're discussing economics, not science fiction.

50 years old sci fi is today’s economics. That was just metaphoric highlighting of the direction which always includes miniaturisation at some point.

If that line about space is the only line you picked up as meaningful, then you missed whole point made and your economics is science fiction, buddy

Right, you're using a magic rock etched with ancient sigils to communicate instantly across the globe. But invoking Science Fiction would be ridiculous, of course. It's not like Science Fiction managed to predict any of this.

AI is taking just as long to mature as anything in the past, and it will take 20 years?

I don't think so.

The reality is that the adoption is incredibly fast and that revenues of the AI labs are like doubling by the quarter.

Further, there is the expectation that breakthroughs in applying AI to science, robotics, or medicine may unlock trillions in value.

That this will take 20 years, rather than happen before 2030, is just speculation. None of us can see the future.

> The reality is that the adoption is incredibly fast and that revenues of the AI labs are like doubling by the quarter.

They’re still losing gigantic amounts of money. Whether that is because they’re “flooring it” as it were and growth will eventually catch up, or because the business idea is fundamentally flawed and just temporarily alive because of investor risk appetite, is the fundamental question underpinning whether it’s a bubble or not, and nobody knows the answer to that question for sure. That’s how bubbles work.

No, they are not "losing gigantic amounts of money".

They are already profitable and are investing enormous amounts into datacenter buildout to meet demand over the next years.

What are you talking about? OpenAI is losing money, projected a $14B loss for 2026 and is themselves not expecting profit until 2029-30. xAI is losing money, about 3B.

Granted, maybe I extrapolated Anthropic's profitable operating result to other companies where it's not yet looking so good.

I believe your $14B OpenAI number is from 2025 though.

Where do you get the idea that Anthropic is profitable from? Is this another one of those “if we remove everything that is a cost, then revenue means profit”-scenarios?

Anyone who counts cost as part of their P&L shouldn't be allowed to make decisions! /s

I believe the technical term is EBBT (Earnings Before Bad Things).

The substack linked below only looks into one tiny sliver of the off-sheet circular financing that dwarfs even the most optimistic revenue growth, but it's a good place to start to understand why this is a bubble and that, yes, Anthropic is in fact "losing gigantic amounts of money":

"Boom and bust is not about revenue. To find that kind of risk, start by reading the balance sheet... [The 2008] bust came from off-balance-sheet instruments."

https://kennyfraser.substack.com/p/anthropic-ipo-part-one-wh...

Patrick Boyle goes into a deep dive that's well worth the watch:

https://youtu.be/Ic1Jf7VlXRM?si=DjiP6LVdEykBlWwU

Consider the wisdom of speculating on the incredibly fast adoption of the internet and mobile technologies, and on that basis investing heavily in whatever mobile carrier had the fastest network.

The speculation that the AI investment sector depends on is not just that adoption is incredible and that the value it generates is high, it's ALSO that the companies will be able to capture a significant amount of that value generation for themselves via fees or some other mechanism.

Are the LLM vendors more comparable to Google/Apple in this scenario, or more comparable to AT&T and Bell?

While it's an interesting question whether Anthropic and OpenAI can capture that value, I find the telecom comparisons not so apt.

In this comparison they are more like Apple and Google: they are ahead in research and are able to offer better technology than their competitors.

The six month gap between the open-weight models and the frontier has not closed yet.

Tne value gap is closing, as corporates wind back token budgets towards relative sanity and reassess what they're getting for their money.

The bubble exists because c-suite people are sheep. They follow the herd, and the frontier CEO wolf-wannabes have been trying to herd them in a profitable direction.

But herds are easily frightened, and there's always a danger they'll stampede in a different direction.

And the risk of a catastrophic AI-enhanced online blackout is increasing.

I disagree. For my own enterprise job, Opus 5.5 with a $500/month API budget is the best option.

The cheaper open-weight ones, even if they were available with our enterprise contracts, would be a huge downgrade.

If you are comparing AI to other technologies you fundamentally just don't get it. Yes it is actually different this time...

> The reality is that the adoption is incredibly fast and that revenues of the AI labs are like doubling by the quarter.

How is that compared to the speed at which money is thrown in them? And how much of the profit downstream they might indeed potentially capture with high retention rate?

Bubble can’t be assessed on mere quarter profit expansion over short period (relative to large company group life expectancy).

It is looking entirely plausible to me that Anthropic will make a profit in 2027.

Don't you think that it's less than reasonable to suggest that the technology will take on the order of 20 years to mature into widespread adoption and profitability?

> It is looking entirely plausible to me that Anthropic will make a profit in 2027.

Then you should invest heavily in their IPO, I suppose.

You'll do much better than those of us who believe there is no way their financials can ever work.

I came to my conclusion a different way, I ran different models locally and measured the amout of resources required for basic things. From that I extrapolated some napkin unit economics, and I couldn't find any way to build a profitable business from it.

I don't assume I'm the smartest guy in the room though, so for all of our sake, I hope you're right.

It looks like profitability will come when research costs drop. But that will also probably mean that the moat goes away, and the gap between frontier models and open source goes away.

In which case, the people being profitable won't be the generic big LLM companies. It'll be the people who use the LLMs, or (maybe) specialized AI companies that still have a niche and moat.

> And today's AI, for as revolutionary as it may be, is taking just as long to mature as anything in the past.

This is so demonstrably incorrect it's hard to even begin a counterargument to this point.

> Railroads, semiconductors, plastics, networking... the utility was there for all of them, and so was the potential profit.

I don't see all these things as being comparable to AI... At the bottom, they were "100%" technologies. Trains were just able to transport commodities, and the internet was able to reliably connect computers. So their path to success was about gaining market.

Since they were 100% technologies, they disappeared. One could build solutions using them and forget they are building blocks, because they just worked.

LLM AI is different at the fundamental level, because it's non-deterministic. It needs human-in-the-loop. It won't ever disappear. Gaining market share doesn't fix anything.

Their point is (and I tend to agree), that LLM AI is not different at the fundamental level. The idea is that e.g. coding capability will be a standard feature of future computing hardware, not a very expensive service you rent. Anthropic is the current-gen mainframe operator selling time-shared access. In the future, that capability, too, will just be a commodity, i.e. a part of the silicon in your notebook or smartphone or whatever will replace those.

Yes, to a large extent, for current real world mass market use cases at least, the only thing keeping the biggest players relevant is that they (and their pals) have monopolised access to GPUs by buying them all and making deals to buy almost everything that Nvidia can produce (even more than they can plug in).

If SMEs were able to buy and host their own GPUs, they would not hesitate to avoid paying a subscription for access to AI tools. They're already starting to do this.

Models already are a commodity, the massive bump in access prices to profitable levels is not going to happen, because businesses will not pay it.

I agree about timing, but not the speed:

> And today's AI, for as revolutionary as it may be, is taking just as long to mature as anything in the past.

They may be as expensive to mature (in terms of equivalent duration of total economic output), but by the wall-clock we've gone from "invent Transformers to make translation less bad" to "solves Millennium maths problems" in 9 years.

After 9 years of railroads… well, those were originally an Ancient Greek way to drag ships over an otherwise annoying bit of land, and the more modern attempt had wooden rails and a rope for humans and animals to pull for around 250 years so let's say after 9 years of the steam locomotive: 1784 for the prototype, 1802 for the "first full-scale working railway steam locomotive" (according to Wikipedia), so 9 years past the invention and it was still a prototype.

Semiconductors (well, transistors, i.e. us understanding the process and doing it deliberately, rather than getting lucky with cat's whiskers before we had any clue about quantum mechanics) did at least get commercialised in less than 9 years, but AFAICT in the form of "now our radios are better, sturdier, and smaller" which is a rather smaller change than what's already happened since Transformers.

(Of course, why Transformers, rather than the other attempts at AI? Transformers are when people cared this time around, but there have been previous AI bubbles. I'd argue those are like pointing at 1515 (or the Ancient Greeks) for the railway, or cat's whiskers for semiconductors).

I've been saying for awhile now that the utility is increasingly undeniable. It's amazing technology and for better or worse, is transforming the tech industry (in particular). I just wish we lived in a world without the speculative bubbles, because if this had been developed slowly, deliberately, over time, there would be no necessity to cast aside troublesome details like safety, suitability, and ethics...and we could enjoy the fruits as it was implemented gradually, responsibly, as it matures. As opposed to going "wow, this is really cool, but gosh I feel shitty about using it..."

Nor would it have been thrust blindly into the hands of your manager, the marketing department, the CEO, and countless other folks who have no understanding of how it works, its limitations, or its risks.

A tech workers union or a stronger regulatory state could help with this but neither party has been that interested in either of those things for the last 50 years.

> A tech workers union or a stronger regulatory state could help with this

Look to Europe to see how that has worked out.

Well at least from where I'm sitting, it's working fine for us. We aren't in the midst of an oligarchy made up of the Epstein class, for one.

Could thing be better with the tech industry here? Sure, but at the same time, profits and industry leaders aren't the only things that matters. And at the very least companies here can't just exploit the public with total impunity.

You are posting this on a forum made by American venture capitalists, and not a forum made by European tech unions, for a reason.

Indeed I am, and you're right, there is a reason for it. The tech unions don't need to capture mindshare in order to advertise VC-funded startups ;)

We shouldn't assume that YC is hosting this forum out of benevolence. However it is true that this place is also useful for things other than just advertisement, so that's a neat side effect. We just shouldn't assume that that's the primary purpose of HN.

Curious to know what you think the reason is exactly. Nuclear weapons? Economic imperialism? Ruthlessness?

Can you read the non English speaking forums? Because they exist and people post on it but if you're a monolingual American you won't know it.

> We aren't in the midst of an oligarchy made up of the Epstein class, for one.

Aren't you? Or, haven't you noticed yet?

We are. In the UK we have the former Prince Andrew and Peter Mandelson selling information to Epstein. There are lots of other people all around the world connected to Epstein and mostly investigations are slow or on-existent or blocked through lack of cooperation by the US.

Epstein's network is one we know about because its been exposed and because of the sexual abuse aspect of it has both drawn attention and made people less likely to cover up for those involved. Its only a fraction of the corruption that goes on though.

> We aren't in the midst of an oligarchy made up of the Epstein class, for one.

Europe even has literally hereditary monarchies; let alone an insular upper class who are famous for their debauchery. They just have much less free speech protection so it doesn't get bought up as much because of the legal risks.

Related note, but while looking up some background info on Wikipedia it appears [0] it was technically illegal to publicly insult Donald Trump in Germany at the start of his presidency which would have added a hilarious angle to a classic joke [1].

[0] https://en.wikipedia.org/wiki/L%C3%A8se-majest%C3%A9#Germany & https://en.wikipedia.org/wiki/Freedom_of_speech_by_country#G...

[1] In the USA, you can stand in front of the White House in Washington, DC, and yell, "Down with Ronald Reagan", and you will not be punished. Equally, you can also stand in Red Square in Moscow and yell, "Down with Ronald Reagan", and you will not be punished.

Hereditary super class is by miles less dangerous then tech bro CEO. The latter are so closed to actually finishing American democracy

Yes, America is somewhat freer then Russia. Despite aligning itself woth Russia, trying to help it as much as possible last years.

But no, America does not have more freedom or human rights defense then Europe. It has also much worst powerty.

Is that a joke?

The US is great for free speech as its constitutionally protected. However it is also very corrupt. Pros and cons.

There are a lot of advantages to constitutional monarchies in terms of stability. The monarchs do not actually have much power. I on balance prefer living in the UK and would not want to move to the US. There are pros and cons, and its culture and society (e.g. unarmed police) as well as politics and some if it is about personal circumstances (as someone who is obviously ethnic minority or foreign everywhere in the world I prefer a less racist society, for example).

I can yell "down with the King" or "down with the Prime Minister" pretty much anywhere. There are some restrictions on protest in a few places like Parliament square.

I am also a European. Our oligarchy looks different for sure (and look into the history of pedophile scandals in Belgium, BTW).

I am not as optimistic as you. We seem to be stagnating our way into a stark choice between becoming an American tech vassal, a Chinese tech vassal, or losing out the remnants of our ability to compete on the world markets. Half of the continent borrows money at an unsustainable rate in order to pay millions of people to do nothing for decades.

We have made decisions that looked reasonable at the time they were made, but too much has changed in the meantime and now we are stuck in bad equilibria.

The Bismarckian pay-as-you-go pension system was stable as long as people had plenty of kids and died, on average, a few years after retiring. Now they have one kid and spend 20 years in retirement before they die. The maths of that system just does not work out anymore.

The European highly regulated industry was king as long as the rest of the world had no other choice, but now that Asia has industrialized, they are blowing us out of the water. First with lower prices, but now also with quality. German exports are half of what they used to be, with another halving expected. And of course without exports, our current social spending cannot be sustained either - you cannot keep such a massive redistribution mechanism running on an economy based on selling each other cups of coffee in a beach bar.

Our most talented engineers tend to move abroad and stay there. Brain drain is one of the most serious things that can happen to a country or a continent, and we are suffering from it.

We just cannot continue to live like that, something will have to yield, but many voters just don't want to hear that.

When you say “increasingly undeniable” do you mean that it’s already plainly undeniable and it’s getting more so? Or do you mean it is still a bit deniable but is threatening to become undeniable soon?

> I just wish we lived in a world without the speculative bubbles

Speculative bubbles, I.E. risk is where much of the capital comes from to develop these ideas to start. I’m not sure you can have one without the other.

Is the utility increasingly undeniable? What does data actually show?

> I've been saying for awhile now that the utility is increasingly undeniable.

If that was true it is strange that you would find yourself saying as much for a while now, given it sounds most appropriate in response to someone denying the utility of slop generators.

I wonder if physical technological progress is also the same as information treatment progress. Everybody is happy having food and materials faster. But AI bringing you solutions faster is also taking away your job, passion.. the negative side seems larger.

>I wonder if physical technological progress is also the same as information treatment progress. Everybody is happy having food and materials faster. But AI bringing you solutions faster is also taking away your job, passion..

and, apparently, our brains https://www.media.mit.edu/publications/your-brain-on-chatgpt...

> But AI bringing you solutions faster

Is it?

Every single vibe-coded software I've ever used looks pretty on the outside but has massive, glaring holes in functionality that make it unusable.

It's like having food faster but then you find out it's actually full of silicone and microplastics.

You don’t have to “vibe code” anything to get enormous benefits from AI.

Yes, but "vibe coding" is what's driving the investment bubble.

I cannot comment but I would like to know if there's data to support that assertion.

Bubbles aren't caused by betting on the technology. They're caused by betting on the wrong companies. Say you have railway, and there's 5000 railway companies. At this point no one has any idea what good looks like, and it changes every 6 months. Investors bet on all 5000, and once all the drama is over, there are 3 companies still capable of competing in the railway business. The investors in the other 4997 get screwed, but since the investors also bet on the winning companies, theres a good chance the actual successful companies themselves get screwed because their investors are broke. There is then intense consolidation, and one of the 3 to nail the technology is still left standing while somehow there are now 3-4 other companies that won by taking talent and inventions from bankrupt companies or just by peaking after the bubble burst. About 20% of the bubble companies have also survived by finding niches.

That's a bubble. It happens every time because it has to happen every time. If you stay out of the game, the people who stay in the game win and your holdings in redundant technology are worthless.

Bubbles are caused by reckless stock purchases leading to insane, unjustifiable valuations, regardless of the company's prospects.

Hysteria + widespread financially illiteracy means there are lots of people prepared to buy AI stocks at any price. They're adamant to get in (FOMO).

Suppose OpenAI will be a successful company into the long term, and you bought its stock at a $5T valuation. After several reporting seasons and subsiding hype, its true worth turns out to be closer $1T. OpenAI could still be enormously successful, but anyone you bought at much over $1T valuation is going to get hurt.

Nah.

Every single railroad company failed. That repeated several times.

The ones that existed on the end were created by assembling the capital brought on the bankruptcy of the original ones. Most of those failed too.

That's how a bubble is. No original investor got out ahead.

Cycles have got faster due to distribution becoming much easier. So Google and Amazon survived the internet app crash. Microsoft did just fine out of the PC.

Financiers and Entrepreneurs are playing the game better then they used to, they should both survive at higher rates.

The difference is that all those things needed physical infrastructure to be linearly build out.

AI models can be deployed on the same datacenter as the old one and be either orders of magnitude cheaper to run, or orders of magnitude more capable.

The only thing that can pop this bubble is if we're not smart enough.

And data centers are practically free to build, are welcomed everywhere, cost little to run, and never need to have their infrastructure upgraded!

Google hasn't retired any of its now ten-year-old V1 TPUs or any of the subsequent generations so it's unclear that AI infrastructure "needs" upgrades.

Of course, Google could be wrong about the economics of running old AI processors. Or maybe TPUs are special.

I do wonder how much of their inference is running on 10-year old TPUs. I’d imagine not much, if only because 10 years ago the justification for massive compute was quite different than today.

Citation needed.

>AI models can be deployed on the same datacenter as the old one

This hasn't historically been true. The clusters have been getting bigger along with the models over time. And now we may even want to have these computers have rapid access to extra compute or caches of the internet or other data stores.

> AI models can be deployed on the same datacenter as the old one

Not if the datacenters are in space, you can upgrade the models for a little while but once you need to upgrade the silicon you need to launch new hardware.

That's not the difference. The difference is the distinction between core infra, B2B services, and B2C services.

The companies that sold core infra during dot com mostly died, because they invested in fiber etc far too quickly. Likewise with server factories like Sun.

The B2B and B2C survivors were patchy. A few did extremely well but there were a lot of casualties.

The biggest winners offered B2G - business to government - disguised as search and social media. They were actually selling individual user profiling and targeted ads, and that turned out to be the biggest money maker.

The reason Anthropic and OpenAI appear wildly overvalued is because their offering isn't AI in some abstract sense, it's the next generation of surveillance and persuasion technology. But now with corporate surveillance in addition to the traditional profiling and targeting.

You can tell a lot about what someone is doing - and the industry is doing in general - by looking at everyone's code bases. You don't need to train on them or steal keys to extract immense value.

Potentially there's also the option to eventually make claims on corporate IP developed with AI tech.

Anyone who thinks the companies who pulped and torrented whole libraries of books for their training data would never, ever, pinky promise, try to extract value from the code they're generating is being very naive.

What on earth makes people assume there's still huge growth possible in the information sector? We've long been at the very end of the information age and even the latest attempts to squeeze out more benefits using "big data" have failed spectacularly. Especially when it comes to actually producing physical wealth i have seen no indications at all that we can increase anything drastically with a more efficient permutation of information. For example, Let's assume AI "solves" the traveling salesman and let's assume it indeed does find a better route for the delivery guy, what kind time savings are we looking at? The 8 hour route is done in 7.5? That's not going change any society in any measurable way. The just in time industry might become even juster in time but that's about it.

It might be dated but not too long ago a report showed the effect AI had on the SAP 500 and 490 companies couldn't even find any substantial improvement. Mind you, this is during the craze, this is happening while every manager has all the incentives to use as much of the technology as possible, lest they be the one that missed out on the new steam engine. All of these companies invested heavily in cars because none of them wanted to be stuck using horses while everyone else drives off into the sunset... yet most of them didn't manage to measurably outrun the people on horses. That's not the prediction I would have made if I were switching from horses to cars.

This reads less like a bulwark against sensationalism and more like an attempt to remain ideologically safe in what appears from many angles to be an extremely steep exponential start of what we can probably agree is an S-curve.

> And today's AI, for as revolutionary as it may be, is taking just as long to mature as anything in the past.

I suspect this opinion may come across as naive for the myriad software engineers whose job has become pressing the enter key. Your point about timing is based on solid principles, but I don't think your comment contains a satisfactory argument that the timing is incorrect.

> appears from many angles to be an extremely steep exponential start of what we can probably agree is an S-curve.

In every bubble some say this. And it could be the exact same herd behavior (mentality) that creates a bubble.

How do you know we aren't already through the exponential part of the S-curve and about to enter the AGI winter (i.e. AGI will require a fundamentally different technology than LLMs that is still decades off)?

If no one is willing to pay increasingly high costs of training frontier models, we'll still have the models that we have now that can be fine tuned for incremental improvements. Still tons of utility in that, but little investor upside.

> How do you know we aren't already through the exponential part of the S-curve

From a recent METR report, benchmarks point towards an acceleration, LLMs are getting better at a faster rate. There's no sign that we are about to reach the top of the S curve.

> increasingly high costs of training frontier models

Somewhat surprisingly the gains do not seems to come from more compute, we have on the METR report:

> We are confident that the acceleration was not due to an acceleration in the scaling of training compute.

Link to said report: https://metr.org/blog/2026-11-05-anthropic-ai-rd-acceleratio...

>From a recent METR report, benchmarks point towards an acceleration

On an internal benchmark with internal models, if you look at the public benchmark with public models there is no acceleration. That report also has a big graph labeled "fake data".

This isn't true. Metr reports show consistent increases in acceleration, 1.4x in the November report. Even with the brake of deliberate hobbling by their makers this year.

> Somewhat surprisingly the gains do not seems to come from more compute

I think this could form part of an argument that acceleration is slowing. It's only because we are not making as much improvement out of hardware gains that we're having to find the improvements in more complex architecture and more tricky to create training data.

The fact that the gains are not coming from the traditional place gains come from in technology might be a sign that a high percentage of the low hanging fruit has now been picked.

> I suspect this opinion may come across as naive for the myriad software engineers whose job has become pressing the enter key

FYI Claude Code’s default is Auto Mode these days

> These bubbles aren't about potential, they're about timing.

Oh, I thought they were about unchecked greed and insufficient regulation, but I suppose that works, too

You aren't AGI pilled. NGMI

Seriously this is just missing the entire point

In 1893, GE nearly went bust as the market got cold feet that electrification was too costly, and the uses too abstract and niche. People were also hugely worried about circular financing, as they were guaranteeing bonds and taking equity stakes in their clients.

As we all know, GE then went bankrupt and we went back to whale oil.

They did go bankrupt, just a bit later :)

you are assuming overbuilding. we are probably underbuilding. it's exponential, railroads weren't exponential.

Maybe

fiber too

Why?

This argument sneaks in the fact that models are commodities which is NOT true. Claude has a different personality and performance than other models for example.

Expect more differentiation in the future and not less.

For lots of use cases you don't want the BEST model, you want the model that gets the job done for as little money as possible.

I disagree, I always reach for the best model when I’m at work. For normal questions I do use the default ChatGPT model.

Fundamentally, people underestimate the marginal increase in utility for marginal increase in “intelligence” as measured in benchmarks. Like I’d pay 5x for a model that has 2 units higher in AA intelligence.

You could tell me AA int scale is logarithmic and I would believe you

And that's almost always another OpenAI or Anthropic model, which are cheaper and more reasoning-efficient

> Claude has a different personality and performance than other models for example

This kind of thing amounts to a LoRa applied to your model. There's no reason (apart from potential IP infringement) that someone else couldn't produce a "Claude LoRa" for their model (or, more likely, given the dislike for Claude's writing style, Anthropic could offer a "non-Claude LoRa" for their own models)

I completely disagree with this. What you are saying is that performance, all they need a simple trick and they get Claude performance for free. In that case, why do we see open weight models still lagging?

Assuming you meant this for personality, I’d still disagree but not that extensively. I think personality is nuanced and complex - it can’t be simply lifted and shifted. It’s grown using a meticulous process.

> I completely disagree with this. What you are saying is that performance, all they need a simple trick and they get Claude performance for free. In that case, why do we see open weight models still lagging?

Yes, they are lagging.

But "performance of Claude's from 6 months behind" is fine for a lot of tasks. And the performance of today's Claude will be still useful for many (and more and more) tasks in 6 months.

The frontier labs are making models for smaller and smaller share of the pie, as the capabilities of open models grow. That isn't sustainable

> But "performance of Claude's from 6 months behind" is fine for a lot of tasks. And the performance of today's Claude will be still useful for many (and more and more) tasks in 6 months.

Okay, then why would one buy 6-months-ago performance for 2-3x more from an open weights lab as opposed to a closed lab?

OpenAI and Anthropic are competing heavily with GPT-6 Luna and Claude Haiku 5.5!

Claude’s personality is the worst aspect of the product!

Disagree but I don’t think this negates my point

"Cursor" Grok has the exact same (non-)personality as Claude.

GPT has the same performance. And performance is definitely a commodity. Why wouldn't it be?

I don’t think GPT Astra is as good as Opus 5.5, it’s very noticeable how pedantic and poor at intuiting things it is to me. It often calls things done when Claude would keep working on them, and doesn’t seem to have as good of an eye - often leaving clear visual defects and calling things done.

Something something than you can remain solvent

The market can remain 3.14159...

> Railroads, semiconductors, plastics, networking... the utility was there for all of them, and so was the potential profit.

I wonder why so few people make the comparison to the recent VR hype. We heard the same things there about its unlimited potential, how it's inevitable that we will soon resolve all its shortcomings and that it will become ubiquitous.

I still believe VR will eventually live up to its potential, but no one can deny that bubble has popped after Meta took a huge loss on it. It took too long to resolve the hard problems so the timing didn't work for them.

Because VR failed to deliver at all. The experience is narrow, isolating, and frankly pretty horrible. People get motion sickness. The set of games is limited never mind the set of non-gaming activities. AR similarly has a lot of issues like narrow FOVs, low resolution, and brightness issues.

VR is a toy with a few very narrow areas of application in industry. That does not describe the current status of AI.

VRChat is not really isolating.

> I wonder why so few people make the comparison to the recent VR hype.

AI is already a gigantically transformative technology, with a staggering amount of paid consumption, and virtually everyone I know uses it every day, where I don't know anybody who regularly uses VR in any form.

The ship has absolutely sailed on "is AI a world-changing technology", where "are the leading AI companies worth what's been paid for them" is a completely open question.

AI is transformative _doesn't_ mean there isn't a bubble. Online shopping was transformative too, but there was still a dot com bubble. Amazon survived, Pets.com did not.

Dot com crash is a mush better comparison. Over promise and under delivery in a immature market.

The major problem with VR is that it simply doesn't have a good use case beyond the initial wow effect. AI certainly does.

With AI VR does have usecases.

AI can maintain the multiverse and administrate it. Everyone can create just by talking.

Coding would also be a good usecase, to see the architecure in 3D and talk with Claude, point at stuff, pick him up and put him where the work needs to be done.

I think it's a match made in heaven, AI is just still way too slow an expensive for this.

> Everyone can create just by talking.

Okay, but why would they? And who's going to consume?

If anyone can trivially create, every creation is meaningless. There is no billion-dollar business in abandoned Minecraft servers, so why would this suddenly change when you force people to put on an expensive VR headset to visit them?

> If anyone can trivially create, every creation is meaningless.

Everyone has always been able to trivially create. We live in an attention economy, not a creativity economy. Meaning you can create crap (or ai slop) and people will consume it if you know how to get their attention.

Attention is what gets money. Creation is just fuel for attention. Quality is a part of the equation, but much less important than people generally believe.

Here's a legacy document explaining all this since long before ai or the internet was around: https://archive.org/details/TheManualHowToHaveANumber1TheEas...

> With AI VR does have usecases. AI can maintain the multiverse and administrate it. Everyone can create just by talking.

Nobody cared about multiverses before AI, and it wasn't because of the lack of maintenance and administration. It's just a thing that nobody cares about, AI improve it but it's not going to make people care about it so that doesn't really change anything.

Not measurable in ROI according to reports that keep coming out every week from companies capping spending because the wow effect is not translating into growth.

Obviously AI people say it's because they don't know what they are doing, but are you going to tell me a company like Apple couldn't figure out how translate those productivity gains into something more tangible?

It didndump a lot of money into it, improving some things and headset availability. But arguably a most of it went to useless stuff no one asked for, like paying developers to build shovelware for Quest or their useless corporate Metaverse.

Almost everywhere I the world railways are state owned and heavily subsidised and still aren’t that attractive to customers.

Yep, trains had a good run, but highways and automobiles took over. On-prem inference is the automobile.

> but highways and automobiles took over

The reasons for this are complicated and nuanced though.

Governments think they push the financial burden of transport maintenance on the people (and its a good tool to register and control people too, but thats not a strong consideration I wouldn’t wager), so they fervently cut spending on public transport and curtail cycling infrastructure in favour of cars.

But roads themselves operate at a crazy financial loss and are one of the reasons governments are in crazy debt (which nobody wants to acknowledge).

This is because road maintenance is significantly more expensive than building new roads. Which means that road use becomes heavily subsidised (much more than trains cost per user) but the cost of vehicle ownership, despite that heavy subsidy, is still enormous and one of the largest expenses an average person can have.

- In Europe the petrol taxes pay for road maintenance. Only electric vehicles operate at a loss.

- Train capacity is much, much higher. You couldn't have the density of France, the Netherlands or even NYC without most people travelling by train. LA struggles with 1/10th of the density.

Europe is a large disparate continent, but I don’t know any country (neither Sweden, Denmark, Norway, Estonia, Finland or the UK) that covers road maintenance costs with fuel levies.

In fact in the UK you would be forced to aggregate all fuel and road tax and offset it against road maintenance because there is no direct correlation to be made, as tax is “one big bucket”.

The majority of the planet are going from one point of interest to another at a relative constant rate- but yes people are spread further and further- ironically this is helped by requiring huge parking space everywhere anyone needs to go, and needing huge houses so you can park multiple cars outside. Its a self-reinforcing problem.

(This is most evident when comparing cities like Malmö in Sweden with Orlando, FL. Malmö has a higher total population but approximately 1/20th the road surface- yet in Orlando I kept bumping into the same people everywhere I went because we’d all drive to the same Restaurants and Shops; and despite that happening we had to drive 20-25 minutes to get there! Weird coincidence or natural concentration points? Someone smarter than me would have to say).

In germoney, IF i remember correctly, it is supposed to be like that. Seeing the state of the overall..well..corruption of autobahn bridges, roads and the "private" company governing it seems like its either not enough or the bucket has holes OR the money goes elsewhere. Pensions maybe, maybe gas power stations, who knows?

> Its a self-reinforcing problem.

Problem? It is THE BEST solution we have. Any suggested alternatives are worse and less convenient.

I can cycle anywhere in my city in 15 minutes- and anyone else can too.

Yes, it gets cold in the winter in Sweden- and I sometimes have to wear rainware. But the lack of noise, huge highways and being able to walk if necessary is such a crazy feeling of freedom that you can't possibly imagine.

I literally mean, you cannot imagine.

Being able to drink a beer, and then walk with a friend in the evening with my bike in hand, being able to park anywhere at any time, and being able to replace/fix my bike with no money (or, even buy a new bike without crazy paperwork or registration or licensing for my ability to drive it).

Not having anxiety about paying for parking, fuel or ensuring that I have a place to park, not to mention the lack of abusive road-rage folks.

I've lived in other places, and I've visited supposed "car-utopias" where everything is built to "great" standards and honestly the quality of life is just many orders of magnitude inferior. I've never been to the US and stayed in a nice quiet house without it being 30 minutes drive (in stop/start traffic and with aggressive drivers who cut you off) from anything of any value.

So, no, it's not the best option. It's the best option you can think of.

> in the UK you would be forced to aggregate all fuel and road tax

Just to be clear, there's no specific "road tax" in the UK - it was abolished in 1937. Instead general taxation (e.g. income tax) pays for roads.

Your point about places becoming further apart has been made by Cory Doctorow who refers to it as "geometry hates cars".

Edit: found the Cory link - you might find it interesting, but I suspect it's detailing what you already know

https://thewaroncars.org/transcript-episode-79-the-end-of-ub...

> Just to be clear, there's no specific "road tax" in the UK - it was abolished in 1937.

While this is _technically_ correct, most powered vehicles on UK roads have to pay Vehicle Excise Duty, which is popularly known as "road tax".

And is a totally different thing, and doesn't fund the roads.

The "road tax" misconception is why I feel the need to point it out as it is inaccurate and is used to weaponise hate against cyclists (e.g. "Don't bloody pay road tax"). In reality, most cyclists also drive (not me, though), but everyone who pays income tax is funding the roads which I agree with as they are shared infrastructure. However, it does mean that drivers are being subsidised by non-drivers.

Of course, with the 4th power weight relationship with road damage, ordinary cars are not really causing much damage compared to buses and trucks, so maybe it's better to state that we're subsidising logistics companies.

> The reasons for this are complicated and nuanced though.

Is it? People love to have personal sovereignty over their transportation, given the choice.

I don't know why it's treated as an exclusive choice. IMO they complement each other well. Take public transport where convenient, else take the car.

You have to understand that road wear is governed by the https://en.wikipedia.org/wiki/Fourth_power_law

"The fourth power law (also known as the fourth power rule) is a rule of thumb which states that the damage to the road caused by a motor vehicle increases in proportion to the fourth power of its axle load. This law was discovered in the course of a series of scientific experiments in the United States in the late 1950s and was decisive for the development of standard construction methods in road construction."

"Example: Car (total weight 2 tonnes, 2 axles): load per axle: 1 tonnes vs Truck (total weight 30 tonnes, 3 axles): load per axle: 10 tonnes. [...] The resulting damage differential between truck and car is 15,000 to 1"

PS: this is something electric car proponents don't talk much about

> PS: this is something electric car proponents don't talk much about. In France, we're getting a "car weight tax" too (https://www.service-public.gouv.fr/particuliers/vosdroits/F3...).

I hope trucks transporting fuel for ICEs get equal treatment.

worth noting that many electric cars weigh 2 tons or thereabout, like the car in your example. internal combustion cars tend to be lighter than that

The rule you linked to basically shows that whether a car weights 1.5 tonnes or 2 tonnes (an EV version of a car model usually weight about 25-30% more) is completely irrelevant to road damage when you have heavy freight using the road as well. The single 30 tonne truck from the example above gives the equivalent road wear to 15 thousand 2-tonne EV's.

Cars a tool of state control and not public transport? If the government wants to surveil someone it’s much easier to see exactly where they tapped their card on and off, and if they want to stop people getting somewhere all they need to do is tell the drivers to shut it down rather than set up a bunch of roadblocks.

ANPR is much more effective than trying to track public transport usage, this isn’t even contestable.

Blocking a bus route has a large knock on effect, same for trains, and nobody is taking a bicycle away from you either.

Highways are also heavily state subsidized.

Yep, that's part of why I think the analogy works.

Everything is heavily subsidized by socializing the losses and deflation of buying power for the average person.

Corporations demanding payment for everything at whatever margin they want is little different than taxation without representation and local cops shaking people down for money at random; just different legal semantics

The representation is you yourself by voting with where your money goes. At least in a market with competition.

Without competition you are talking about a monopoly and it is your government that is responsible for mitigating its effects. The government that you elected.

The mechanisms are all there, they just need to be used+embraced.

Yeah I know how the American civil religion gospel goes; don't patronize

There is inherently competition with entropy and just getting ourselves out of bed to deal with everything

Corporations and brands and tax codes are just culture war distractions on top of the raw physical competition; middle ages like words of power

The competition is with the physics that binds us to Earth; does it? Or are we just to distracted by rhetorical competition between legal constructs to embrace the levers of science

Rhetorical competition wrt to markets type blather is only seeking internal consistency with an arbitrary rhetorical framework. Not pushing the boundaries of engineering based on science.

Yall can have AI agents simulate Bloomberg terminals so actual physical scientists can focus on the necessities ground truth work you take for granted

This is an analogy worthy of LinkedIn.

> but highways and automobiles took over

Specifically because of massive government investment in road infrastructure in preference of railways. This would be about like the government deciding to funds DCs directly...

Not even the US, the country that was the most crazed about highways and car infrastructure in the 20th century, demolished its railways - the cargo proposition is just too objectively good. Semi trucks will never have the unparalleled efficiency of strapping many hundreds of tons of cargo behind a locomotive and moving it on rails, both because of their size and because rubber on asphalt is just less efficient.

Passenger rail also makes sense because the same economies of scale can help drive the prices down, and with enough coverage you get enough freedom of movement for 95% of people, with cars and other road transit bridging the last mile. Lots of countries do this very successfully, it's just not a glamorous business.

Based on what data?

I think this is untrue for Japan.

One of the few countries shaped perfectly for railways (Italy also comes to mind)

Florida East Coast railway is also privately owned, and Florida is also shaped right for railroads, being mostly a flat "straight shot".

https://en.wikipedia.org/wiki/Florida_East_Coast_Railway

And China, and India

And commuter trains

Probably important to note that Japan privatised its state-owned rail network, so the private companies did not have to build out the network.

> Almost everywhere I the world railways are state owned and heavily subsidised and still aren’t that attractive to customers.

That's a remnant of the past, where only a nation state could afford massive projects such as creating a railway line crisscrossing throughout a massive country.

Since the last couple of decades we see private companies investing in railway lines, including high-speed railway corridors. We also see a major liberalization push in Europe to decouple railway operators from infrastructure maintainers, and now there are plenty of private companies operating railway services across the world. In Spain alone there are 2 or 4 private companies providing high-speed railway connections between major urban centers.

Yes. That's the situation in 2026 in most of the world. But in the 19th (after the railway bubble - https://en.wikipedia.org/wiki/Railway_Mania) and early 20th century, railways were actually very profitable.

There isn't much money to be made in agriculture but food is very attractive to customers.

Your point is a good one, but it's constructed upon the premise that AI is a single discovery or invention or even a single tech wave.

AI is bigger than the Industrial Revolution, the Internet, than computers, than literally any innovation or invention that has ever come before, combined.

Today you see AI slop and vibe coding.

Tomorrow, all of humanity will be affected, forever.

Everything about the way that we learn, that we think, and that we invent will be changed forever.

AI wouldn’t work without any of that above stuff though.

Their monopolies got broken and the profits disappear in a commodity market.

If nvidia or tsmc got split up i doubt its stock is going to stay at as a high a p/e.

We're discussing AI in general here, not individual companies (and none of those companies have a monopoly). Nobody's arguing that AI wouldn't exist if the previous revolutions hadn't occurred.

Investors get paid back by specific individual companies so the details matter.

This is exactly the kind of talk that led to all the other bubbles. Amazing how infected people get.

That's a fair point, but tulips are not AI.

I'm not even talking about tulips. I'm talking about The Information Superhighway in 1999, I'm talking about real estate investing in 2007.

Each event was so different with different motivations. The popularity of Tulips never back. 2007 was about hiding poor risk mortgages. 2001 every company had money thrown at them and today is about a product that costs more than the market can pay.

The motivation was the same for all of them. Money.

I dunno, we're throwing plenty of money at AI, just like dotcom got in 2001.

But it was thrown to everyone in 2001 vs 4/5 companies today.

Yeah, they at least look and smell nice and you can touch them.

The "internet bubble" didn't make the internet go away nor reduce its impact.

AI can be in a bubble right now and the bubble can explode and yet all what GP said can still be true

I know where you're coming from, but we probably should not be talking about AI in this way. I don't think it's helping or serving its purpose.

I think civilization will have time to react and adapt, panic leads to haphazard action, we need deliberate consistent action.

Strange comment to make. We shouldn't be honest about AI's capabilities?

How do you think we need honest deliberate action if 95% of people believe AI is a scam and a bubble and mostly just hype marketing? Just take HN's comments for example.

You're defending one extreme by claiming the other extreme is the only option. Which isn't honest behaviour even if it was well intended. Truthfully, AI will cause real problems and we need to handle it, but it's also often exaggerated. It's a rapid technological shift, but like all the other ones anyone who works hard will still find a place to be useful.

"Tomorrow, all of humanity will be affected, forever."

This..is not being honest about AI's capabilities. Its just generic hyperbole. Also, simply not specific enough to be called honest or dishonest. It's just panic-inducing.

You know what was actually a bigger invention? Language. Farming.

Imagine a world without those. Oh, wait: tomorrow people won’t know how to use language, will they? And they won’t have water to farm with, so there you go.

AI bots trolling in an AI bubble thread says a lot about the state of AI.

Reply on news.ycombinator.com