Operating margins are also holding up the economy in a different way than you think (the cyclical economy). Wrote about it here: https://writings.alethia.news/the-biggest-piece-of-the-reces...
256 karma · joined November 13, 2012
Here’s to workers rights and living longer.
I think we may revert back to trusting only smaller groups of people, being skeptical of anything outside that group, becoming a bit more tribal. I hope without too many deleterious effects, but a lot could happen.
But humans, as a species, are survivors. And we, with our thinking machines will figure out ultimately how to deal with it all. I just hope the pain of this transition is not catastrophic.
I think he's being a bit harsh here. And there are some confounding factors why.
Yes, we have an AI bubble. Yes there's been a ton of hype that can't be met with reality in the short term. That's normal for large changes (and this is a large technological change). OpenAI may have some rough days ahead of it soon, but just like the internet, there's still a lot of signal here and a lot of work to still be done. Going through Suna+Sora videos just last night was still absoutely magical. There's still so much here.
But, OpenAI is also becoming, to use a Ben Thompson term, an aggregator. If it's where you go to solve many problems, advertising and more is a natural fit. It's not certain who comes out on top of the space (or if it can be shared), but there are huge rewards coming in future years, even after a bubble has popped.
Cal is having a very strong reaction here. I value it, but I wish it was more nuanced.
I really really want this other part of my unconscious behavior modeled well. Would be very useful.
This post looks at the smaller part of the economy that turns first: residential construction and durable goods and why it’s one of the best early warning systems we have. I also built a simple ML model to track it while the BLS is offline. That will be the second article.
Use something closer to market value to GDP (with some adjustments). That is a much better estimate. John Hussman has imo the best of such metrics. Here's his thoughts from August: https://www.hussmanfunds.com/comment/mc250814/
And this image says a lot: https://www.hussmanfunds.com/wp-content/uploads/comment/mc25...
Yes. A lot now depends on when "growth" stops. But GDP is very hard to grow at an sustained high rate justifying higher valuations. Even through industrial revolutions, assembly lines, transistors, and the internet.
This is a systems problem. Successful examples wanted.
Welcome thoughts on what has worked and what has not worked.
By many different measures, we are at record valuations (though must be said, not P/E however). Tends not to end well. And housing prices are based on when mortgages were at 3% and have not reset accordingly. We are in everything bubble territory and have been.
I think even Byrne Hobart would agree (from his interview with Ben): -- Bubbles are this weird financial phenomenon where asset prices move in a way that does not seem justified by economic fundamentals. A lot of money pours into some industry, a lot of stuff gets built, and usually too much of it gets built and a bunch of people lose their shirts and a lot of very smart, sophisticated people are involved with the beginning, a lot of those people are selling at the peak, and a lot of people who are buying at the peak are less smart, less sophisticated, but they’ve been kind of taken in by the vibe and they’re buying at the wrong time and they lose their shirts, and that’s really bad. --
This is a classic bubble. It starts, builds, and ends the same way. The technology is valuable, but it gets overbought/overproduced. Still no telling when it may pop, but remember asset values across many categories are rich right now and this could hurt.
Just a great response. :)
Also, Smiley is getting up their in fictional characters I admire. Not Iroh level, but up there.
What’s been most valuable for me is the way they create a kind of imperfect but effective Socratic dialogue with whatever I’m reading. I was the kid who always had my hand up in class, not to show off, but because I hated leaving something unexplained. Good teachers could make a text come alive by answering those questions.
LLMs give me some of that back outside the classroom. Even when I ask them to speculate, the process forces me to interrogate the material and refine my own model of it. That’s changed how I read, learn, and even how I experience novels.
So innovation on this “Socratic interface” and other interfaces is pointed in the right direction.
Tension is, imo, ephemeral. If you keep chasing it, you are chasing dopamine loops. Little good comes from this.
But meaning is different. When you can remind yourself a truly great "why" you are doing something, can re-frame it, it can help.
Most importantly, boredom, irritation, and anxiety are temporary. They are emotions. They do not define us or the work. It was a joy when I realized that all these emotions will pass. They really do. You can sit with it. You really can. You can't make it go away, but it will pass.
We live in a culture where everything is gunning for our attention, trying to engage a dopamine loop and "relieve" us from dealing with often important but difficult emotions just below the surface. We have to train ourselves to deal with this environment.
It's not mindfulness training, it's how to operate our brains in the modern world.
This is not easy, but I've found working on this every day is better than any form of traditional meditation or "mindfulness" work. It truly is work, like exercise, and the point is not how long you do it, but noticing more and more when my DMN engages and I can return to breathing and reactivating my parasympathetic nervous system.
I can't stress enough what a change occurs after two months of focusing on this.
I don't think any of us can predict how this will play out, but it certainly is interesting to watch the user growth/receding and watch the waves.
I know I am not the average user, but for those who care about their information diets, RSS is essential.
One underappreciated aspect: RSS can forward both machine readable and human readable content at the same time. I am experimenting with it for information processing, and I like that you can always peek into the pipes, even mid-stream, to see what is happening.
I will be writing more about this at https://writings.alethia.news (alongside AI, product design, macroeconomic data, and the occasional bit of trivia).