this post was submitted on 13 Aug 2023
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This kind of feels like a common sense observation to anyone that's been mildly paying attention.
Tech investors do this to themselves every few years. In literally the last 6-7 years, this happened with crypto, then again but more specifically with NFTs, and now AI. Hell, we even had some crazes going on in parallel, with self driving cars also being a huge dead end in the short term (Tesla's will have flawless, fully self-driving any day now! /S).
AI will definitely transform the world, but not yet and not for awhile. Same with self driving cars. But that being said, most investors don't even care. They're part of the reason this gets so hyped up, because they'll get in first, pump value, then dump and leave a bunch of other suckers holding the bags. Rinse and repeat.
I also don’t know why this is a surprise. Investors are always looking for the next small thing that will make them big money. That’s basically what investing is …
Indeed. And it's what progress in general is. Should we stop trying new things? Sometimes they don't work, oh well. Sometimes they do, and it's awesome.
You're conflating creating dollar value with progress. Yes the technology moves the total net productivity of humankind forward.
Investing exists because we want to incentive that. Currently you and the thread above are describing bad actors coming in, seeing this small single digit productivity increase and misrepresenting it so that other investors buy in. Then dipping and causing the bubble to burst.
Something isn't a 'good' investment just because it makes you 600% return. I could go rob someone if I wanted that return. Hell even if then killed that person by accident the net negative to human productivity would be less.
These bubbles unsettle homes, jobs, markets, and educations. Inefficiency that makes money for anyone in the stock market should have been crushed out.
No, progress is being driven by investment, it isn't measured by investment. If some new startup gets a million billion dollars of investment that doesn't by itself represent progress. If that startup then produces a new technology with that money then that is progress.
These "investment rushes" happen when a new kind of technology comes along and lots of companies are trying to develop it in a bunch of different ways. There's lots of demand for investment in a situation like this and lots of people are willing to throw some money at them in hopes of a big return, so lots of investment happens and those companies try out a whole bunch of new tech with it. Some of them don't pan out, but we won't know which until they actually try them. As long as some of them do pan out then progress happens.
Just because some don't pan out doesn't mean that "bad actors" were involved. Sometimes ideas just don't work out and you can't know that they won't until you try them.
Perhaps we're talking to different points. Parent comment said that investors are always looking for better and better returns. You said that's how progress works. This sentiment is was my quibble.
I took the "investors are always looking for better returns" to mean "unethically so" and was more talking about what happens long term. Reading your above I think you might have been talking about good faith.
In a sound system that's how things work, sure! The company gets investment into tech and continue to improve and the investors get to enjoy the progress's returns.
That's not what I interpreted the parent as saying. He said
Which I think my interpretation fits just fine - investors would like to put their money into something new that will become successful, that's how they make big money.
The word "ethical" has become heavily abused in discussions of AI over the past six months or so, IMO. It's frequently being used as a thought-terminating cliche, where people declare "such-and-such approach is how you do ethical AI" and then anyone who disagrees can be labelled as supporting "unethical" approaches. I try to avoid it as much as possible in these discussions. Instead, I prefer a utilitarian approach when evaluating these things. What results in the best outcome for the most number of people? What exactly is a "best outcome" anyway?
In the case of investment, I like a system where people put money into companies that are able to use that money to create new goods and services that didn't exist before. That outcome is what I call "progress." There are lots of tricky caveats, of course. Since it's hard to tell ahead of time what ideas will be successful and what won't, it's hard to come up with rules to prohibit scams while still allowing legitimate ideas have their chance. It's especially tricky because even failed ideas can still result in societal benefits if they get their chance to try. Very often the company that blazes a new trail ends up not being the company that successfully monetizes it in the long term, but we still needed that trailblazer to create the right conditions.
So yes, these "bubbles" have negative side effects. But they have positive ones too, and it's hard to disentangle those from each other.
I appreciate the effort, but I was not critiquing your reading. Moreso that I took it differently. That's just a misread on my part and my point was not about general investing as a proxy for progress/a driver.
No problem. I've got tangled up in "disagreements" where it turned out everyone was talking about different unrelated things before, hence the big blob of text elaborating my position in detail. Just wanted to make sure.
Yeah, I appreciate the nuance too! It's just I don't have anything to really add as I'm the one who misread!