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The AI Boom May Be Sowing Seeds of Another Financial Crisis

39 points angry_impala 56 minutes ago 34 comments

Kevin_Flynn 52 minutes ago | parent

Looking at GPU prices today, this is an understatement.

My finances are in crisis.

You know whos winning ... the bitcoin miners retiring unprofitable cards, if they still have them.

Good job guys.

angry_impala 50 minutes ago | parent

Yeah, but how logical is that when you don't even have the electrical grid capacity to turn on all the GPUs that have already been bought?

Kevin_Flynn 47 minutes ago | parent

I would think if they were mining with them before, they had the capacity at that time.

After bitcoin halfed enough, the electricity cost more for the miners.

Now with the AI boom, people are paying premium prices for low end cards, because they run AI tasks exponentially faster than CPUs do.

So the electrical load that was once centralized at the mining site, gets distributed.

Being able to schedule your AI agents to work during off peak electrical prices, and sleep during peak pricing, seems to be a stablizing factor for the grid.

Im talking about the used video card market.

Not the billion dollar data center market.

Prices are up 35% in the last 3 months alone, and I just paid way too much for a RTX 5060 Ti 16GB for the ram.

angry_impala 42 minutes ago | parent

I get it, I'm just saying when people point to GPU prices as some sort of proof this is all logical, it's actually the place where the logic begin to unravel the most blatantly. They have more GPUs then they will be able to plug in for at least a few years.

DubiousPusher 11 minutes ago | parent

This is why data centers are starting to burn fossil fuels on site behind the meter for power. Including using diesel generators.

Kevin_Flynn 41 minutes ago | parent

@angry_impala .. thats their business. i needed a card. :|

Adapt to the worlds problems.

Don't adopt them.

duskwuff 8 minutes ago | parent

> You know whos winning ... the bitcoin miners retiring unprofitable cards, if they still have them.

Bitcoin mining hasn't used GPUs in ages. They've been all-in on ASICs since 2013 or so; even if the GPUs were free, they wouldn't be worth running.

duskwuff 33 minutes ago | parent

"May be"? I think everyone sees this one coming.

dyauspitr 22 minutes ago | parent

Not until one of the major AI companies says they’ve hit a limit for intelligence for models.

EA-3167 13 minutes ago | parent

The markets appear to be hitting their limits first, and it’s the money that’s keeping this show on the road. Why do you think Anthropic is racing like mad towards an IPO?

david-gpu 13 minutes ago | parent

And because everybody sees the risk, it is already priced in.

The stock market is unpredictable precisely because everybody is trying to guess what is going to happen next. Dollar cost averaging takes the guessing away.

angry_impala 9 minutes ago | parent

Nothing is ever really priced in when it comes in into layered structured debt and credit default swaps. Not even the default swaps.

xhkkffbf 9 minutes ago | parent

I agree that there's much wild speculation, but some of the speculation is pretty mild in comparison. Micron trades at a forward P/E multiple of approximately 4.3 x to 5.0 x based on consensus forward earnings estimates. Those aren't bubble numbers. Those aren't even utility numbers anymore.

I think everyone is worried and, at least in this case, being cautious.

MengerSponge 33 minutes ago | parent

May? I'm pretty sure there's a crisis coming one way or the other, but the crash happens only when they fail to make God In A Box.

0c3ca83 32 minutes ago | parent

It could be worse. There's a chance they succeed.

obscurette 22 minutes ago | parent

I'm pretty sure that the worst things will not come from AI/tech, but from other things – education freefall, population crisis, pension system collapses in Europe etc. If at all, AI and the current situation in tech is one of last false hopes to ignore all this.

drivebyhooting 9 minutes ago | parent

What is education free fall?

China is ready to step in with millions of PhD-level graduates.

0c3ca83 9 minutes ago | parent

AI is going to be a driving force behind it if it begins to work. What do you think the results of most humans suddenly becoming economically irrelevant will be?

Keep in mind that today, if essential workers go on strike, those in power have to listen. What happens if people on UBI refuse to... something? Especially in a world of increasingly automated policing and surveillance?

munk-a 10 minutes ago | parent

Anyone who truly buys into that I pity. But it's sure a useful line to help sell the magic.

0c3ca83 7 minutes ago | parent

Well, either it's going to fail or the trillions going into finding breakthroughs are going to find breakthroughs. How much do gasoline do you want to give arsonists, even if at the moment they're only pouring it onto concrete?

I would like to take away the gasoline before they figure out that wood burns better.

lenerdenator 4 minutes ago | parent

The goal of God In A Box wasn't a good goal anyways.

Most people can't agree on what God In A Box (AGI, the singularity, whatever) even is. We don't have a widely-accepted definition for it.

The SMART criteria for creating goals has been around since 1980 [0]. Goals need to be Specific, Measurable, Achievable, Relevant, and Time-Bound. This is stuff that they teach most people in bachelor degree-level college course. Not even. Maybe in high school or associates degree-level courses.

If God In A Box was the goal that SV sold all of these investors on to the tune of over a trillion dollars of investment, the best thing we could do with everyone involved is have a massive settlement where all of their money just goes to pay off a fraction of the national debt and they're banished to live in the Alaskan wilderness, never allowed near more than $50 at a time or long-distance telecommunications devices again for as long as they live.

[0] https://en.wikipedia.org/wiki/SMART_criteria

acd 25 minutes ago | parent

1. Hedge funds buy 2. Hedge funds exit 3. Pension funds buy 4. Early investors exit

Fordec 24 minutes ago | parent

I came across https://www.youtube.com/watch?v=q2nA2szz8dY a few days ago from during the financial crisis, and the things he listed as the four causes all apply here too just replace Property Developers with businesses adopting AI as part of the hype cycle. The debt and capital markets have their part to play this time too, just not the primary problem. But the ingredients are all still there for AI.

xlayn 19 minutes ago | parent

Goverment regulation... when goverment has regulated wall street and banking industry no issues... as soon as "we will let them regulate, no mam, door plugs will not start failing on airplanes..." things go south.

lnkdinsuxs 13 minutes ago | parent

I lost my job during the dot com bust and since that shook me, I was very skeptical of properties making people rich overnight.

"There's no free lunch!", I told myself, but it was becoming increasingly hard to ignore my barber, the cashier at the grocery store, my dentist, my landscaper - all who had bought highly leveraged properties and had actually made profit.

I'm not ashamed to say I started to look into it myself - I was even ready to purchase some leveraged properties myself but kept getting outbid by even crazy offers.

Then 2008 happened.

Now again in 2026, my barber, the cashier at the grocery store, my dentist, my landscaper - all cannot stop talking about Grok Bot, about "Chat" (they usually mean ChatGPT or Gemini).

Maybe this time I can get in and get out in time, get real rich!

duskwuff 10 minutes ago | parent

Isn't there a story about Rockefeller and a shoe-shine boy with stock tips? Because that seems apt.

AnimalMuppet 4 minutes ago | parent

I believe that was Joseph Kennedy, father of JFK and RFK. He realized that he didn't understand what was going on in the stock market at all, and so he got out, a few weeks before the 1929 crash.

Off topic: I first wrote "2029" instead of "1929" because habit. Wow, the start of the Great Depression was 97 years ago? I find that surprising.

mlsu 10 minutes ago | parent

Are they talking about using it as a consumer? Or somehow getting rich off it? I think those two indicators are very different.

lnkdinsuxs 5 minutes ago | parent

> Are they talking about using it as a consumer?

Consumer. Their usecases seem pretty valid - the landscaper is using it to drum up more business, has agents responding to incoming emails and texts, just like my dentist and barber.

The cashier uses GrokBot to transcribe notes to her manager.

I can see nothing wrong in them just like I could see no wrong in buying properties and flipping them for a profit because there was so much demand at that time. If you weren't buying houses 2003-2009, you have no idea how crazy it was. People would buy homes unseen in Olathe, KS.

It's likely just me but it just feels eerily familiar.

vkou 6 minutes ago | parent

> Now again in 2026, my barber, the cashier at the grocery store, my dentist, my landscaper - all cannot stop talking about Grok Bot, about "Chat" (they usually mean ChatGPT or Gemini).

I mean, they should be. It's a transformative technology that is doing something that was not possible five years from now, and it going to make a few people trillionaires, and it's not entirely clear where it will leave the rest of us.

That doesn't mean that you should, like, be rushing to be a bagholder.

jr3592 5 minutes ago | parent

> Maybe this time I can get in and get out in time, get real rich!

Well, since you seemed to know what you needed to do back then (but didn't take action), what do you think you need to do now to "get rich"?

a_sewer_rat 5 minutes ago | parent

It's absurd we're in this position to begin with. Bloomberg taking years to find out what technical people saw months if not years ago.