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Post #1754155
2026-04-28 20:14 UTC
Thanks for posting this; if you hadn’t, I would have. Piper really doesn’t seem to understand that bubbles form and pop over a span of three to five years. Like, I’m not sure how much charity I’m supposed to give to analyses like:
When you read “AI is a bubble,” think of the dot-com boom of the late 1990s: Yes, the internet was going to be a big deal, but valuations soared for specific companies that had small or speculative revenue, often on the assumption that they would capture the value the internet would one day deliver. They didn’t, their stocks crashed, and the invested money was mostly lost. The internet was as big as imagined — bigger, even — but Pets.com didn’t survive to see it.
Pets.com!? Kelsey, even reading a basic article about the dot-com bubble would have saved you embarrassment here. Zitron’s analogy is excellent because the bubble is multifactorial and the analogies that we can make are factor-to-factor. Here’s some things that caused the dot-com bubble; people were overly optimistic about:
Fiber optics, leading to massive overinvestment in Nortel (GPUs, nVidia)
The AOL Time Warner merger (take your pick, notably Paramount Skydance Warner)
Enron delivering a Web app (Oracle Stargate; for Oracle’s record of delivering Web apps, see Oregon v. Oracle)
Legal rulings like USA v. Microsoft (Thaler v. Perlmutter mostly, see AI and copyright, Lemley 2024, summary previously, on Awful; and memorably previously, on Lobsters where I literally threw a legal textbook at somebody)
9/11 (the current conflict in the Middle East, which I hope eventually gets a cool name like “The Oil Tantrum” or “The Epstein Distraction”)
Compared to all of that, Kelsey, Pets.com was just an Amazon.com experiment. Remember Amazon.com? Did the dot-com bubble kill them? No? Anyway, Pets.com is kind of like the small labs that hover around OpenAI and Anthropic, trying out various little harnesses and adapters on top of their token APIs. Pets.com is like OpenClaw; it’s not that important of a player in the overall finances, just an example of how severely the big labs are distorting incentives for small labs.
The 2024 and 2025 articles make, basically, the business case against AI: that companies aren’t really using it, it isn’t adding value, and AI investors are betting that will change before they run out of cash. In 2026, the focus is much more on alleging widespread, Enron- or FTX-tier outright fraud.
The uselessness of the products in 2023 directly led to the bad investments in 2024 and the Enron-esque financial deals in 2025, Kelsey. The future is conditioned upon the past, y’know?
Replies (4)
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Zitron’s analogy is excellent because the bubble is multifactorial and the analogies that we can make are factor-to-factor. Here’s some things that caused the dot-com bubble; people were overly optimistic about:
Ed has also been clear there are a few factors that make this bubble worse (for the economy and the general public) than the dotcom bubble. For one, Ed is strongly convinced that GPU lifecycles are much shorter and worse than fiber optic life cycles. You build fiber optic infrastructure and it will last for decades. Meanwhile, GPUs used constantly at max load have life cycles of 3-5 years. The end result of the internet is also much more useful and less of a double-edged sword than the slop generators which churn out propaganda and spam.
Open ##1783243
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Alleging widespread financial fraud?! How absurd! And to prove just how absurd it is, I will namedrop the infamous financial fraud from the industry full of exactly the same people. Checkmate atheists
Open ##1783285
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Excellent summation!
Open ##1793656
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All the legal and regulatory uncertainties make it very hard to talk about the financial viability of chatbots. What do you do if your $20 billion model is shut down forever by court order after it counsels the wrong person into suicide? Piper can overlook this because she is a hack with patrons - to my knowledge, she has never been paid to write by anyone outside the EA world. If she were a working writer who had to deal with chatbots driving up the cost of her website, creating knockoffs of her novels, and competing for editing gigs (let alone someone whose friend had a mental crisis after talking too long with friend computer) she might sound different.
Zitron's populist, conspiratorial tone reminds me of independent investigative reporters from the 1990s and 2000s who also had to find and keep paying readers. Piper just has to persuade one patron at a time that she has propaganda value.
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