Photo by Milad Fakurian on Unsplash

Is The AI Bubble About To Pop?

The $100 billion red flag.

You know that feeling when someone is overly inflating a balloon, and you can’t help but wince? It’s a sense of “be careful, that is going to hurt!” combined with bracing for the inevitable BANG. That is how I, and many others, have felt for years now regarding AI. We have been urging the world to brace for when this obvious bubble will burst for so long now, it feels like we are crying wolf. But over the past few months, even the finance bros have begun to wake up, especially with Nvidia’s $100 billion investment in OpenAI. This represents one of the most concerning red flags possible, and it is foreshadowing a catastrophic collapse. Let me explain.

If you need to know why the AI industry is a bubble, read my previous article here. Essentially, AI has been overhyped, and not only can it not deliver on its promises, but the limitations of the technology also mean that it cannot significantly improve beyond its current state. In other words, it isn’t profitable for people to use generative AI or to operate a generative AI company. This means that the hundreds of billions, if not trillions, of dollars that have been poured into this technology won’t generate a return. It is a bubble. And, once investors figure that out, they will try to exit quickly; the value of the entire industry will tank, taking anything associated…