Why wouldn’t it? The closure leads to price increases which leads to inflation which leads to non-dollar assets (ie stocks going up in value)
Second from a US perspective the strait matters the least it has since world war 2. If the price stays high a bunch of fracking will come back online.
I think this argument proves too much. Historically energy shocks have led to recessions, and in recessions the stock market usually doesn't go up. And the US economy is certainly exposed to global recession regardless of whether we're a net exporter of fossil fuels.
The Strait of Hormuz is, basically not a big deal unless you're driving your big ole' truck. Americans are price sensitive and so some companies will have to absorb pricing increases, customers will absorb some others, and so forth. In other words, business as usual. Of course the closure of the Strait is a big problem for most of the rest of the world. They better get on with figuring out how to get Iran to stop being so chaotic in the region or we'll just keep it shut down indefinitely. No big deal.
Because the United States has so many advantages (primary global reserve currency, robust and efficient capital markets, highly sophisticated and dynamic economy across all sectors except luxury goods, &c.) it's able to weather these storms much easier than most other countries. As a country that also imports so much, if we spend less on imported products that's less of a problem than not being able to sell products. A recession isn't great, but the current parameters seem to suggest to me it's less of a problem for the United States - perhaps why we're in part seeing stock market valuations continue to climb.
Are you serious? Even ignoring the other things that ship through there, a significant disruption to global energy supply is significant to most people. If you're not driving a truck, you're probably using goods that contain plastic or took energy to produce or were moved from one place to another in fuel-powered vehicles. If, somehow, you're not, you're probably using services that are.
The world let this disease (IRGC) fester in the region for too long, and now because of that the fix is going to require significant pain. The IRGC in its current form has run its course and will not be allowed to threaten American interests, allied interests (whether that's Israel, UAE, Saudi Arabia, or otherwise), and they will not be permitted to build a nuclear weapon or threaten global trade.
The reason nobody was dumb enough to attack them before is that it's an unwinnable conflict. They don't need a lot to close the Strait of Hormuz, a few guys rolling mines off a beach would do that. And they have a lot more, like missiles and drones to do damage at a distance too.
And it's a regime that has at least a million loyal fanatics ready to fight for it (the Basij, the org that did unarmed meat waves against Iraq to defend the regime). So any invasion is an absurd proposition.
So what, the hope is that the theocratic kleptocracy will give up? Not even a child could be so naive. They literally believe in martyrdom, whacking a few of the top dogs means nothing.
It's like the Kims, nobody can unseat them. Only this is far worse, because Iran has the leverage of Hormuz, and it knows it can wait - because they don't care about the people - while the US and global economy suffer until they fold. Especially with midterm elections coming, the US will fold.
> Especially with midterm elections coming, the US will fold.
These are the kinds of misunderstandings that are disappointing to see. There is no disagreement here amongst the political class. It is political theater for votes. Apparently you’re susceptible to the marketing.
We don’t need to invade Iran. We just keep the Strait closed since we control it and then Iran’s economy simply fails and the worst thing that happens for America is higher prices. But we can handle that.
The political class answers, in a way, to the population. The American population is extremely sensitive to the price they get at the gas station (because of the complete lack of alternatives in driving in most places, and the average car having bad fuel economy). If by election time the prices are the same, the ruling party will get punished. And the ruling party doesn't want that.
What's your sales pitch exactly for how that's the best thing for the non-US rest-of-the-world? What's the US's post-WWII track record, success-wise, in regime-change foreign wars, how much would you trust the US on this one?
> What's your sales pitch exactly for how that's the best thing for the non-US rest-of-the-world? What's the US's post-WWII track record, success-wise, in regime-change foreign wars, how much would you trust the US on this one?
Honestly not all that bad for the US.
Korea - we stopped the North Koreans from taking over the entire peninsula. It’s China and Russia’s fault that the hell hole we know as North Korea exists today.
Vietnam - unnecessary war, but we won the peace.
Panama - took out Noriega
Desert Storm - stopped Saddam and kicked his thugs out of Iraq.
Serbia and Bosnia - NATO campaign. I’m personally a little unsure if the results were good or not but I understand we collectively stopped a genocide.
Afghanistan - we tried our best and made some mistakes along the way. Eventually got Bin Laden though. Too bad the rest of the world didn’t help. Now we’re seeing a massive regression in women’s rights there.
Iraq - probably not worth the money, but Iraq went from a brutal dictatorship under Saddam to a much more stable and peaceful country with a Parliament.
Venezuela - Took out Maduro with no losses.
Iran - TBD on the long term but we’ve stopped the IRGC buildup and at least bought time to figure out what to do.
The rest of the world stands on the sidelines and complains and complains yet the United States actually has the balls and will to do things. We aren’t perfect, but without US military action or at least the threat the world would be much more dangerous and much worse off. China sure as hell isn’t going to send troops to liberate Kuwait. Europe doesn’t have the military capability to stop Iran from getting nuclear weapons and exerting a stranglehold on a large chunk of global oil supply.
> Vietnam - unnecessary war, but we won the peace
> Afghanistan - we tried our best and made some mistakes along the way. Eventually got Bin Laden though. *Too bad the rest of the world didn’t help.* Now we’re seeing a massive regression in women’s rights there.
> At its peak between 2010 and 2012, ISAF had 400 military bases throughout Afghanistan (compared to 300 for the ANSF) and roughly 130,000 troops.[7] Forty-two countries contributed troops to ISAF, including all 30 members of NATO.
Are you unfamiliar with the term? In the case of Vietnam we “lost” the war, yet today we have pretty strong and good relations with Vietnam. Hence we won the peace.
> Why are you lying about this?
I have a different perspective, but that doesn’t mean I’m lying.
Of course many countries contributed in various ways to Afghanistan, and as a former member of US military I have incredible respect for our friends and allies and still do today. But at the end of the day the vast majority of the manpower, cost, and equipment was American and the country could not be won solely on military power alone and needed much more support diplomatically, politically, economically, and in terms of aid.
The other problem with your argument is if you claim that Afghanistan was an American failure it contradicts your assertion and instead everyone failed, except that the US contributed the most. You can’t have it both ways.
> Korea - we stopped the North Koreans from taking over the entire peninsula. It’s China and Russia’s fault that the hell hole we know as North Korea exists today.
The regime still existed, and wasn't prevented by that restriction from nuke/missile development like you are so worried about in Iran. "It's other countries fault" isn't an excuse here, it's something that should be taken into consideration more generally in advance.
> Vietnam - unnecessary war, but we won the peace.
But no regime change accomplished with the war itself, yes?
> Desert Storm - stopped Saddam and kicked his thugs out of Iraq.
I think you mean "kicked his thugs out of Kuwait". And let's keep that in mind: a defensive operation worked well.
> Serbia and Bosnia - NATO campaign. I’m personally a little unsure if the results were good or not but I understand we collectively stopped a genocide.
I don't really think this qualifies as "regime change" vs intervention campaign in a "traditional" existing conflict?
> Afghanistan - we tried our best and made some mistakes along the way. Eventually got Bin Laden though. Too bad the rest of the world didn’t help. Now we’re seeing a massive regression in women’s rights there.
"Got Bin Laden" isn't a regime change, and now obviously the regime is not good. What was the rest of the world supposed to do to make it better? Occupy every square mile of the country with soldiers for a couple generations?
And then this one:
> Iraq - probably not worth the money, but Iraq went from a brutal dictatorship under Saddam to a much more stable and peaceful country with a Parliament.
There's no face of a dictator like Saddam anymore but I think "stable and peaceful" oversells it. But yeah, this is the most direct not-yet-imploded regime change in the area on the list.
Notably left off your list regime-change-wise here is Iran in the 50s. That one seems to have backfired. (And that's a great example of why Venezuela, Afghanistan, this-iteration of Iran, even Iraq all are still open-books with potential unforeseen consequences left to come.) The biggest direct threat to date from the Middle East to the US itself hasn't been from nation states, it's been terror groups that have festered post-intervention attempts.
The calculus for this attack on Iran assumes that they were going to escalate imminently in a new, more direct, way and that it would directly threaten the US itself; both of these seem a bit far-fetched after decades of the status quo. It's also an area where the US seems to not have much credibility because there was that whole less-than-a-year-ago "we knocked back the nuclear program" post-bombing claim.
And in particular:
> we aren’t going to let Iran obtain a nuclear weapon or build up such a missile and drone stockpile that they could then threaten and attack their Gulf neighbors and implement restrictions maritime trade, which they were likely to do
seems like that actually did happen, and maritime trade is already impacted? Seems a bit silly to say "the US must act to prevent the very thing that the action will provoke."
No it’s not silly. It’s called a preemptive action. It’s a very well understood concept. In the case of Iran it’s very straight forward. We could do nothing and then in a few years they just say hey the Strait is now closed, pay us, and then there isn’t anything anyone can do about it. We can disagree on the likelihood but I think it’s dishonest, as many pro-IRGC folks like to do, to suggest that it wasn’t a possibility, certainly a strong one, that Iran was moving in that direction.
Why is it that Iran, after all the US has tried to do (US because nobody else has any ability to do anything) that they need special treatment and to hold the world hostage else they get to develop nuclear weapons? I don’t think Iran or more countries in general having nuclear weapons is a good thing. Do you?
> You listed 9 things, 2 are far too recent to evaluate, and of the remaining 7 these 5 are regime-change failures (or simply not-regime-change-attempts):
Sure, what list of regime change operations do you want to use? Happy to discuss any of them. But at the same time you can’t simultaneously criticize American action here as being ineffective and then also say for other operations that “You listed 9 things, 2 are far too recent to evaluate”.
> The biggest direct threat to date from the Middle East to the US itself hasn't been from nation states, it's been terror groups that have festered post-intervention attempts.
Currently sponsored by Iran. Why don’t they just stop?
Is it lost on you that nobody in America gives the slightest shit about Iran except that they keep funding terrorists and killing people, selling drones and helping Russia murder Ukrainians, killing 30,000+ of their own people who were peacefully protesting, and constantly trying to build a nuclear weapon? If they just stop doing these things, which are unique to Iran, mind you, then none of this needs to happen.
> Notably left off your list regime-change-wise here is Iran in the 50s. That one seems to have backfired. (And that's a great example of why Venezuela, Afghanistan, this-iteration of Iran, even Iraq all are still open-books with potential unforeseen consequences left to come.)
Not a great point because, well, the world is always changing.
> The regime still existed, and wasn't prevented by that restriction from nuke/missile development like you are so worried about in Iran.
And the world is worse off for it. Millions of North Koreans are living in one of the most brutal and inhumane dictatorships to ever exist. Them obtaining nuclear weapons isn’t a model to follow.
> "It's other countries fault" isn't an excuse here, it's something that should be taken into consideration more generally in advance.
It’s not an excuse it’s just the fact of the matter. Communist governments in China and Russia are responsible for North Korea. We should prevent more such countries from coming in to existence if we can.
Alternatively, I’m fine being an isolationist. It’s a lot cheaper and everyone else can just worry about all this stuff instead. There is no in between. You get the US involvement and the good that it does, or you get isolationism. You don’t ever get “America only takes international actions that I agree with”. Impossible standard. Which do you want? I’m happy to lift sanctions on Russia and Iran and North Korea and everyone else, withdraw the US military, and leave everyone else to fend for themselves militarily unless we have an interest we want to pursue. It’s a valid enough strategy.
Some Americans need to have their understanding of the world checked. If you think high gas prices are the end of the world, just wait until we have a real problem. Are we going to be incapable of fighting a war because Netflix and Pepsi prices went up or it's too expensive to coal roll down the highway?
Separately as someone who supports both Ukraine and the US and taking down the Iranians it's amusing to see each political tribe get mad about gas prices as it is convenient for them. When Russia invaded Ukraine, MAGA was screaming from the rooftops and putting Joe Biden "I did that" stickers on gas pumps. Now that we're taking on the Iranians all of the commies are doing the same thing (aren't gas prices good anyway since we need to do something about global warming?). Neither side of populist is worthy of serious consideration. Stay the course, whether that's supporting high gas prices because of Russia or because of Iran.
Cuba ran out of fuel because we took out their thug partner in Maduro. If they wanted to drop the whole authoritarian communist dictatorship stuff and their involvement in the disaster that became Venezuela and partnering with the Russians then they'll be better off.
Since when is it acceptable to invade another country just for being communist or a dictatorship? Conventionally it's up to the people in those countries to overthrow a dictator. Other countries only get involved if the dictator attacks them (like the USA dictator did).
Such is the burden America must face, unfortunately. If we do nothing then Iran builds more and more missiles and a nuclear bomb and then they close the Strait and there’s nothing we can do about it. Then we get asked “why did America let this happen?”. Same with Ukraine. Sure let’s but out of other people’s business… only to get asked why we are abandoning Europe or whatever.
Secondarily, it’s plenty acceptable all the time. In the case of Iran I think it’s justifiable simply on the merits of them providing help to Russia in its unacceptable invasion of Ukraine. Never mind the strategic concerns I’ve mentioned, that Iran murdered over 30,000 of its own citizens, and spreads conflict and devastation throughout the region via proxy groups and other methods. Take out Iran and we are pretty much left with peaceful countries remaining.
Do you like being able to buy food?
Food production will decrease, and even moderate increases in food prices mean many people unable to afford enough food.
If you can't get oil, you can't grow food.
Fuel doesn't come into it.
You won't have fertiliser.
We're the number one oil and gas producing country in the world. Nobody is concerned about whether or not the United States can grow food or fertilize it. At a higher cost? Yea maybe. Oh well - the alternative is unacceptable.
Worst take I’ve ever seen on this website.
> Americans are price sensitive and so some companies will have to absorb pricing increases, customers will absorb some others, and so forth. In other words, business as usual.
No. Not all goods/services have the same price elasticity. At some point, people stop buying some goods if they are too expensive. They stop commuting to work. We start to see breakdown of the supply chain.
Literally 100% of many towns in the US depend on trucks to deliver food to their grocery stores and the inventory on hand usually only lasts a few days. Once those trucking deliveries become unaffordable for either party in the contract, society starts to. Real down.
Consumers don’t magically make more money when the price of gas rises. It starts to crowd out their ability to spend on other things. The poorest of the working class likely has to commute the furthest so they will end up sacrificing something to keep paying for the commute - food or rent or utilities.
The US doesn’t weather this because we have “a sophisticated supply chain”. _If_ we weather it, it’s because we created the US SPR after the last major oil crisis and we have significant domestic supply (although not all oil is fungible so we might not have enough light sweet to keep the economy running at 100%).
The second problem with your argument is that you’re using it as an argument against the war but it’s actually an argument in favor of the war. Why is that? Because as Iran continues to load up on missiles and pursue a nuclear weapon they reach a point where they can assert control over the Strait and shut down shipping pending tribute to their theocracy (maybe if it was a Christian one you’d have a bigger problem with it? Idk?) and then we couldn’t do anything about it. The world isn’t static. Stop treating it as such.
Iran never attempted to develop a nuclear weapon. Literally 30 years of Netanyahu threatening it is just “weeks away” and Trump was the only US president to get suckered into that argument.
They have always used the threat of developing it as power, both domestically and regionally. It was 100% the exact same thing with Sadaam Hussein and WMD — they want to appear to have the strong weapon, but simultaneously don’t want to develop it or use it (until, ironically, Trump / Israel took out their leadership). Also, we were assured their entire nuclear program was “obliterated” summer 2025, so which is it? It can’t simultaneously be non-existent and an urgent national security threat to the US.
Now that Trump started the war in Iran, we are playing chicken with people who don’t care if they die or not (or so we are told). Not exactly a good position to be in against the “world’s largest sponsor of state terror”. We kicked a hornet’s nest and our political leadership didn’t stop to ask the experts (military, political, or economic) what were the completely predictable second and third order problems with this strategy. We couldn’t even get Trump to wait long enough to fill up the US SPR before starting a massive war in the Middle East.
To reiterate, we haven’t felt any of the actual pain YET. My arguments thus far are only of current harm, not the likely harm in the near future. That’s for next month’s comments.
Also, the US SPR was created in 1975, so we are going to get to see if it actually works to absorb an oil shock like this.
Most likely there will be some places which are almost unaffected while others are going to see unaffordable price spikes (more than 400%). The pain won’t be spread evenly.
In other words, BAU for the last few thousand years.
yet balk at someone deciding to fight back in kind and on an exponentially smaller scale, comparatively speaking?
Otherwise humanity is over
People say that LLMs won't take us there. I think that's accurate, but there's a great deal of research going towards the next breakthroughs. How much are you willing to bet that all future attempts will fail?
We're trying very hard to build an ugly future.
But also, even if bust is business as usual in the big picture and not a social disaster long term, it's of course not what individual investors want for their particular current investments.
But as for this
> why is all the money printing remaining in the rich person's realm instead of trickling down?
Always has been, it's kinda one of the defining features of capitalism
The assets in the S&P 500 have, that's what was brought up.
All to say, your SO's dad would have been right at any point prior to the current financial cycle. Knowing what's changed doesn't make forecasting easier though.
Why wouldn't it? The value of the USD is decreasing, the value of the companies to the world stays the same => stock price in USD increases.
The real thing to analyze is "amount of VOO shares you need to buy a Chipotle meal / Uber ride / 1 month's rent in SF / etc."
heh this is the trick. The tech companies will angle for a bailout and they'll benefit from all this speculative data center building. Compute is generally useful.
IMO, what's happened is a few richest investors in the world had access to the uncensored tier of AI, talked to it and came out with impression that they've witnessed something so dark, so much beyond anything we can imagine, that the only course forward is towards the transcendent abyss. Call it AI psychosis or demonic inspiration, but they are the people who control the economy, so they are dragging everyone with them. "Operating in the interest of the future AI" is a neat way to put it.
[plausible sounding nonsense]
Never overestimate the billionaire class....
If there is a psychosis, what is it? It is not an AI psychosis - modern AI started in the 1940s, or by some definitions before, and made progress up until 15 years ago to where deep neural networks became viable. And it has been progress on every front since then. No psychosis, it is doing well.
You mention the stock market, and that is another story. Cryptocurrencies, sub-prime loans, dot-com crash, Asian financial crisis. The economy has veered from crisis to crisis, overproduction and overproduction to crashes and bailouts.
AI is doing just fine - the past 15 years are a success for it we did not see in the decades before. If the economy as constituted is dealing with this in a "psychotic" fashion, it would not be the first time.
And it does mean things if you understand the meaning of the terms in the context of "finance".
Also $1T in data center investment makes sense when you realize that companies are racing to create virtual white collar workers. Google spends $9B a year on software engineers.
Which will take decades to become addressable. Self-driving cars work OK in a few cities in one country. Expanding that to be able to cover Mumbai and Omsk and Nairobi will require significantly more work.
> Also $1T in data center investment makes sense when you realize that companies are racing to create virtual white collar workers.
Does it make sense? How much would the resulting virtual white collar worker cost? Because datacenters have running operational costs, and so do the people operating them and working on the software that runs in them.
The money printer will be used, and maybe it all works out - or we see wealth hyperinflation and build out our own aristocracy.
Henry Ford II: "Walter, how are you going to get those robots to pay your union dues?" Walter Reuther: "Henry, how are you going to get them to buy your cars?"
And for so long, I've had people tell me to just get a job. But I tell them that I don't want a job: I want money and I want something to do. Those two things don't have to be together.
I think this is the hard part: philosophically so many of us have learned we need jobs and don't realize a job can be decomposed into money and something to do.
So I think we need to start looking more creatively at 1) how people receive money from others and 2) how people give services to others.
Nobody cares that you want money and you want something to do that you enjoy. Nobody ever will.
If you actually dig into all the social programs that exist at least in the US, they’re just a massive payday for a small group of people under the guise of bettering humanity.
College/education is a fantastic example. Education as it has been established today is a joke. The humanities were originally established for rich bored wives to have something to do. They were never meant to create value. Colleges hang anvils around the necks of naive children via loans telling them “yes if you major in history you’ll have a job!” This is a joke, and a bad one.
Huxley was on to something. If everyone is educated, nobody collects trash, or chops lumber, mines minerals and metals, etc. it’s a big fucking not-talked-about open secret.
Nobody cares, either you bring something to the table someone else can exploit for money, or you lean into “I’m helpless and the government owes it to me to take care of me because I’ve been indoctrinated into learned helplessness.”
“AI” will at best lead to anarchy at this point, if all the grand visions of the billionaires comes to fruition. People have already tried to kill sama and burn his house down. Wait until armed humvees are driving around data centers. It’s coming.
So when we talk of people doing labor for money, we are assuming they can only own their body and receive money from that?
you may not like the fact the fat capital owner may not be lifting a finger, but they certaintly aren't getting a free lunch.
So I don't think it's a free lunch, it's more risk-for-lunch than labor-for-lunch. Maybe you could argue laborers are still risking their body or something, but I think the point might stand.
The only thing capital owners risk is losing it and becoming a worker.
You paint the economic model as a false dichotomy, and the main point of my posting was that it is not a false dichotomy. It is not either have a job (and be exploited by someone else) or be helpless and rely on government handouts.
For example, what if people who got laid off from companies were given significant stock in the company, so that they might partake in the potential savings and gains from replacing the workers with AI or other tools?
The whole conversation seemed to be about the economic model, so I'm not sure how it is a distraction, a boogeyman, or inconsequential.
You have described less than 0.1% of the US population, not to mention the rest of the world.
I get it, you have an idea in your head and you're struggling to see past it. Read Brave New World.
Fair, my one example on layoffs may not land with you.
But do you want us to just sink into the helplessness of us all being screwed or do you want to try to find solutions that might allow us to feel some sense of agency and hope?
OTOH replacing people with AI would indeed bring about a huge economic downturn. What would be good is augmenting humans so that they can do 10x more. That would enable things that are hard to imagine exactly now, much like computers enabled interesting transformations in the society from 1980s to 2010s.
The current crop of AI is by construction unable to reach the human level of cognition, but it is quite good at doing some symbolic manipulation tasks. We will get used to that, and will integrate that in our workflows. Humans are still going to be needed.
You have to cut costs when the costs do not bring you enough profits.
If in fact you can meet the same market demand with fewer workers and the market does not expand accordingly, you get deflation and job losses.
Hundreds of billions are changing hands globally, every week, at the retail level alone.
And that happens literally every week, week after week.
That constitutes a massive market in any sense I can think of.
That needs a way more complex explanation than simple gut feeling.
That's not a new market, that's a new feature in an existing market. Lots going on in transportation and I'm not seeing any scenario where self-driving cars vastly increase total output vs just eat up other forms of transportation and change where people live/how long they commute.
> Also $1T in data center investment makes sense when you realize that companies are racing to create virtual white collar workers. Google spends $9B a year on software engineers.
Similarly, many companies are trying to be more efficient - "do what we already do, but better". That's different than growth.
What could Google do with 9B on software agents? Let's say the future of them is amazing and this means they could write 100x more code than they can today.
Has Google recently showed much ability to turn "more/faster code" into "superbly profitable new market"?
Someone's gonna have to crack the demand side issue for anything transformative to happen.
Well they are projected to spend $175 - $185B on capex in this year alone most of it for AI buildout. Lets say only 150B of that is for AI. If they can then somehow replace all their software engineers with AI that they then run for free and depreciate over 10 years then they just replaced 9B a year software expense with 15B a year depreciation expense for the next decade. Yes this is grossly oversimplified but it still illustrates how crazy high of a bet they're making on AI.
I believe the One Big Beautiful Bill Act allows full depreciation in the first year: https://www.bassets.net/blog/obbba-depreciation-2025-2026-gu...
No. It doesn’t. And if you’re defining “drives” as “it drives as well as I do” then you probably shouldn’t be on the road.
> makes sense
Nothing about any of this makes sense. Tell me, when all white collar jobs are replaced by AI, where will the customers come from? Who will have income to afford your products or services? The poor barista whose surveillance videos are training the robot that will soon replace them?
Leaving aside any consideration of human compassion or questioning of the purpose of an economic system (hint: it’s not just an abstract machine), shrinking the pool of potential customers by orders of magnitude has never been a recipe for sustainable success (let alone growth).
Such as?
In my personal life, I have leveraged these systems to design code that I don't believe I would ever have been able to designed. And, because no other human may attempt to, this means the same thing: That no human would have been able to do it. Things like reverse-engineering niche APIs and digging into binary files to diagnose weird format conversion issues.
That seems very relevant to my evaluation. I can pull out my calculator right now and solve a problem no human ever has.
If we want to understand a phenomenon, we should be careful with technical terms. It is not "psychosis" [1] anymore than bad software that makes mistakes is "hallucinating".
The truth is simpler and less dramatic: hapless ambition-monkeys who climb the corporate ladder are demonstrating that they are not promoted for mental acuity. Corporations, after all, do not serve "the interests of humanity" — they are an organised collusion system that diffuses responsibility and anonymises negligence. And when it works as intended, shareholders rejoice.
For companies that can afford to build data centres, the latter are seen as a sure bet that can't fail, like building a bridge or buying new computer/hardware now with the pile of cash on hand without necessarily knowing which OS/software they will install. They are even planning to restart or build nuclear reactors. [2]
[1] https://en.wiktionary.org/wiki/psychosis
[2] https://www.cnbc.com/2024/12/28/why-microsoft-amazon-google-...
The stock market keeps going up in the face of the indefinite closure of Hormuz. We're investing in datacenters at a scale that only makes sense if AI capabilities continue to advance to the point where they surpass most humans at most white collar tasks, if not reach superintelligence.
And what are the possible outcomes?
- Bust. We've come away with a useful tool but the hundreds of billions of capital expenditure were thrown away on a pipe dream.
- Success! We're the dog that's caught the car. Then what? Currently the political debate is, to caricature only slightly, between "oh no the datacenters will use more water than golf courses" and "lol what are you going to do, regulate matrix multiplication?". How the hell are we going to cope with introducing a new intelligent species?
Either way, it sure seems like we're collectively operating more in the interests of the future AI than in the interests of humanity. What is this, if not a sort of psychosis?