In the 2008 Financial Crisis there was something called a credit default swap (CDS) on specific tranches of mortgage-backed bonds that could be bought to short the (fake) housing market. Is there something like that for AI?
>>61037050Gold
>>61037050Go further in history to the dot com bubble youngling.
>>61037050You could just short any of the mag 7, particularly nvidia. Their entire business model is being able to network their GPUs together, bypassing the slow bottleneck of standard PC components like DDRM, PCI, or ethernet, into a single super-GPU. This is only necessary to train and run massive, ever-bigger LLM models, and basically nothing else. Almost all of their revenue, including revenue they plan on getting in the future and count on their financials, comes from selling these to cloud providers and a few other types of companies to build these GPU superclusters, which take years to make. The moment there is no longer a need to run the latest, biggest LLM, their demand will dry up, contracts will be canceled, and they will be unable to repay their debts.
I thought the whole point of 2008 was that the companies selling swaps couldn’t actually afford to pay them out so it presented structural counterparty risk. Why would you want to buy them?
>>61037059Dot com is the closest thing. The internet had huge potential which most people saw, but everyone got way ahead in capex and venture funding before revenue was there. Some early dot com ideas were way ahead of their time like grocery delivery but it took another 10 years before people started seeing value in something like that.Imo, “ai” in its current form is much less exciting than the dawn of the internet. But the insane capex euphoria is at dotcom levels
>>61037425AI literally makes shit up all the time. I'm talking fabricating references from whole cloth.This is what everyone's pension is in? Really?!
>>61037436It’s in its infancy and could improve a good bit. But I think it can and probably already is plateauing hard in it current implementation without huge breakthroughs.
>>61037464GPT5 was actually worse than GPT4No reason to think we aren't approximately at peak """AI""" and it's still a dumb chatbot that can't admit when it doesn't know something.It should be called Artificial Indian.
>>61037050Reminder that everyone who tried to bet on CDSs got nothing except BVRRY, and even he almost didn't get paid.
>>61037050Short NVDA
