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Comment by james_oofou | Hacker News Reader

I'll take it for finance people being totally clueless, right? Have you talked to these people about AI?

My experience has gone the other way than OOP: Anecdotally, I have had VCs ask me to review AI companies to tell them what they do so they can invest. The VC said VCs don't really understand what they're investing in and just want to get in on anything AI due to FOMO.

The company I reviewed didn't seem like a great investment, but I don't even think that matters right now.

To be clear when I said “finance folks” I wasn’t really referring to VCs. I’m talking more family office types that manage big pools of money that you don’t know about. The super wealthy class that has literally has more money than the King but would be horrified if you knew their name. Old money types. They’re well aware of the “dumb VC” vibe that just throws money after hype. The finance folks I’m talking about are the type that eat failed VCs for lunch.

And what is it that you believe about these old money types' knowledge of AI and why is it that you believe it?

I hate to break it to you, but this is besides the point.

The marginal investor is the price setter, you, I and everyone else are just price takers in the market.

If enough marginal investors decide assets are over-valued, you have no choice but to accept it.

In my experience they invariably conflate LLMs with AI and can’t/won’t have the difference explained.

This is the blind spot that will cause many to lose their shirts, and is also why people are wrong about AI being a bubble. LLMs are a bubble within an overall healthy growth market.

LLMs are a bubble on the back of an AI bubble in a market finally surmounting an enormous single-shot energy surfeit

LLMs are the air in the AI bubble.

Machine learning is a perfectly valid and useful field, traditional ML is super useful and can produce very powerful tools. LLMs are fancy word predictors that have no concept of truth.

But LLMs look and feel like they're almost "real" AI, because they talk in words instead of probabilities, and so people who can't discern the distance between and LLM and AGI assume that AGI is right around the corner.

If you believe AGI is right around the corner and skip over the bit where any mass application of AGI to replace workers for cheaper is just slavery but with extra steps, then of course it makes sense to pour money into any AI business.

And energy is the air in the economy at large. The Eliza effect is not the only bias disposing people to believe AGI is right around the corner. There are deeper assumptions many cling to.

I agree about ML.

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