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Comment by diggan | Hacker News Reader

> I hope I’m wrong

I kind of hope you're right. Any "hyped" industry/sector is bound to eventually needing to get back to reality, and focus on things that actually work, rather than spraying and praying prototypes and over-hyping them.

The individuals and companies building real products that actually improve something will stick around, either as they are, or at least as ideas, and most of the interesting stuff tends to happen when the hype dies down, as the builders continue as they were, but all the rest of the riffraff disappears.

There will still be a community and the ideas won't magically disappear, just smaller and more focused, which to me sounds like a much needed improvement over the current state of things.

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> I kind of hope you're right.

I couldn't care less if big tech gets knocked down a peg, but in many quarters the AI boom is what's keeping the lights on. A market correction of that magnitude would mean a lot of pain for a lot of normal people, it's not exactly something I'm cheering on...

If the hype doesn't line up with the fundamentals, then the bubble will have to burst sooner or later.

But not knocking it down will also mean a lot of pain for the people? Just look at the unsustainable electricity demand and skyrocketing prices big tech is pushing upon the small folk due to their explosive needs for more and more big data centers.

As someone who've jumped on previous hype-trains, most of us who get involved with "frontiers" know it's over-hyped, have more realistic perspective of it and are more-or-less ready for what eventually will come.

I'm sure most people heavily invested into AI (energy, money or time-wise) know the consequences of the bet they've done, they're not exactly just trying to earn a living.

If the crash/bubble-pop would have change of impacting actual working class folks outside of the AI bubble, I'd agree with you. But I don't think the bubble is so large, the people impacted will be people who willfully made a risky bet.

I don’t know. I’ve read the AI bubble/spending is so big (new data centers, power plants, etc) that it’s propping up GDP. If that all went away plenty of normal people could get hurt. Still, probably better sooner than later. Well, maybe after the power plants are done so we have excess capacity.

Continuing the masquerade will only make things worse

Yeah, it's like an infection. Do you want to deal with it now, when it's painful and you'll lose your finger or when you risk your arm, or risk dying of Sepsis. You can put off the pain but that will make the outcome worse.

> A market correction of that magnitude would mean a lot of pain for a lot of normal people

A 1% increase in US unemployment results in thousands of excess deaths per year.

It is hard to be exact about the numbers, but the trend is clear and strong, see e.g. https://pmc.ncbi.nlm.nih.gov/articles/PMC3070776/

The AI boom is masking the fact that the rest of the US economy has crumbled. Things can’t even begin to be fixed until people see they aren’t ok.

Is there actually concrete numbers on this? I was speaking to a friend about this the other day and we both concluded we didn't actually have evidence either way.

Well we’re gonna get, and need, a big correction. I just hope it’s a “big correction” and not a financial implosion that sets the startup ecosystem back a generation.

That return to reality has happened many times in the past. It has happened several times before with AI! In every case with the worthless stuff the bubble was propping up we also lost a lot of useful things too and it generally took a decade for the people who had those useful things that the bubble could help with to realize they shouldn't have stopped investing with everyone else when the fad changed.

Hard disagree. The correction you envisage to something smaller and more focused won't happen because this is also a race between nation states. The bubble is in the startups, and you're right to suggest many are doomed. But the AI giants have strategic national importance now, and won't be denied funding and resources while their foreign rivals continue to grow.

In my naïve of opinion, AI is not necessarily about coding or making things better, it's more about creating a system to control the message to the masses. Just like Facebook controlled the message during the Clinton/Trump campaigns, AI is going to control the message for the vast majority of easily swayed people. Especially now since it is very hard to detect between real and AI generated persons/data (see Tilly Norwood).

This relates directly from your post about nation states. Those who control the message control the people.

Your comment made me think of this post:

https://www.palladiummag.com/2025/10/03/how-gdp-hides-indust...

I think it would be better to have a bust now when the actual sums that have already been spend are relatively modest (~100bn?) rather than the $1tn over the next couple of years people are talking about.

The only upside here is if a few notables end up penny-less and dressed in orange. The mockery of solvent business practices, greed and theft is insane in this bubble. From copyrighted material to accounting fraud, I'm sure the fallout motion pictures will be entertaining some day.

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