"No matter how much is said about the hundreds of billions of dollars hovering over the tech industry's head like an anvil in the "AI bubble," it just won't pop. Not only is it refusing to budge, but it's growing by the day. The AI bubble is getting so bad, in fact, that it's making previous market bubbles look like chump change."
"Even worse, Garran estimates that AI now accounts for over four times the wealth trapped in the 2008 subprime mortgage bubble, which resulted in years of protracted crisis. In the case of the dot-com bubble, according to macroeconomist David Henderson, major economic catastrophe was avoided as the impact of the stock market rush on US GDP growth was minimal. Unfortunately that isn't the case with AI investment, which now accounts for a massive chunk of our economic growth after years of unfettered hype."
"The trouble with AI, he told MarketWatch, is you "can't create an app with commercial value as it is either generic [as in video games], which won't sell, or it is regurgitated public domain [as in homework], or it is subject to copyright." He adds that it's also a hard product to market effectively, as one AI startup in New York City is making clear as its subway adverts get covered with hostile graffiti."
Estimates place the AI bubble at roughly 17 times the size of the dot‑com bubble and over four times the wealth trapped in the 2008 subprime mortgage bubble. The AI sector now represents a substantial portion of economic growth, unlike the dot‑com surge whose market rush had minimal impact on US GDP. AI offerings currently demonstrate limited long-term commercial value, often producing generic or regurgitated outputs or running into copyright issues. Marketing AI products proves difficult, as hostile public reactions sometimes appear on subway adverts. Meanwhile, system costs are escalating exponentially while capability gains diminish.
Read at Futurism
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