The Enshittifinancial Crisis
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Soundtrack: Lynyrd Skynyrd — Free Bird This piece is over 19,000 words, and took me a great deal of writing and research. If you liked it, please subscribe to my premium newsletter. It’s $70 a year, or $7 a month, and in return you get a weekly newsletter that’

… And why we’re all fucked by it.

Tldr: the entire US economy is propped up by NVIDIA and the companies that buy its GPUs for generative AI applications. But generative AI is not and will never be profitable. All that investment is a gamble on future profits that will never actually happen. It is a scam. It is a bubble hyped by analysts and marketers to keep stock prices going up.

Once the market figures that out, everything burns. The market collapses. Shareholders, investors, and anyone with a retirement account loses everything. And (the article doesn’t say this explicitly, but I think it’s obvious) a significant fraction of that lost wealth is transferred to the hyperbillionaires running the AI companies who see this collapse coming and cash out ahead of time.

This is fourth stage enshittification: where technofeudal megacorps, having leeched all value from users (stage 2) and business clients (stage 3), now turn on their shareholders, stripping value from the stock market and their shareholders for the benefit of their hyperbillionaire owners.

This may be the actual end game of end stage capitalism and is almost certainly the beginning of the next Great Depression.

I realize this is basically a novel, but if you want to understand why the US economy is fucked, read it.

  • DaddleDew@lemmy.world
    10·
    23 hours ago

    AI is essentially a meme stock now. I’m pretty sure that a lot of investors know that but they don’t care because they can still make money with a bubble. This will make the collapse all the more spectacular, but once again, they don’t care because they can still make money from it on the short run.

    As a bare minimum the stock market needs to be reformed because the forces at play do not incentivize a productive or efficient use of investment money and everyone will suffer from it as a result.

    • U7826391786239@lemmy.zip
      6·
      1 day ago

      i think the difference this time is that the us govt salivates over AI for its use in spying/surveillance over the entire online universe–i feel like they’ll make sure AI doesn’t implode no matter the cost to everyone and everything else

      • stabby_cicada@slrpnk.netOP
        2·
        15 hours ago

        I agree with you, and that’s why I think the US government specifically will let the AI bubble burst - so that the feds can buy up all those data centers for pennies on the dollar (and a promise to look the other way at all the pumping and dumping and insider trading the hyperbillionaires did to come out ahead in the AI crash).