Idk man, to me, it feels like we are further from AGI than fusion reactors actually being hooked up to the grid, considering LLMs are still just glorified autocorrects, needing a ton of prompt injections from their providers. And yet, the AI companies make it seem like it’s right around the corner (obviously, because $$$), whereas to me it feels like we are still at least 50 years away. Maybe AGI will be the next fusion generator chase.
Ironically there was notable news in the fusion reactor space this week as Gemini 4, building on the work of Matt Landreman and GPT-6 Astra a little while ago, expanded counterexamples to Grad’s conjecture which had claimed exact solutions for controlling a key aspect of fusion were impossible.
So fusion may actually be more around the corner thanks to the advances of capabilities of AI which helped prove that the fusion problems aren’t as hard as they were thought to be for decades.
And if you actually believe that, I have an amazing business proposition to you. So, there is a bridge in NY, and I can sell it to you for very little money…
Building on other people’s work to provide examples for something is actually one of the things an LLM can be good for.
They did manage to do something different, though. I thought at one point that proof assistants should offer to automatically upload your proofs to a central repository so everyone can benefit from them. But such a system would require many to opt in for it to be useful.
What AI does best is giving you existing solutions. It even adapts them if they don’t quite fit. Because many people now discuss their ideas with AI, ideas may spread the same way as well when the conversations are used as training data.
So no, definitely not AGI but valuable. Though as typical of explosively growing startups the value does not come from the technology but from activity bordering on criminal that lawmakers can’t keep up with.
Because many people now discuss their ideas with AI, ideas may spread the same way as well when the conversations are used as training data.
As a training data it’s possible less then useful, unsupervised data like that is actively harmful. As a central repository of everyone’s private conversations it can be in a way useful, but I can’t understand how anyone could be OK with a private company reselling your most private data.
AGI has been achieved more or less because it just means self sufficient at completing tasks. An LLM is just a component these days because they are Vision-Audio-Language-Models with multi frequency ‘thought’ loops. The next letter is A for action where they just have high frequency outputs for direct computer and robot use.
Just because it is bad AGI doesn’t mean it is not AGI right
See the problem is that people expect AGI to learn on its own. LLMs sorta do with big enough context and writing memories, but… They also don’t. They don’t get better at reasoning or anything, they only get better at solving the tasks they’ve written notes on. Which are themselves often pretty bad notes.
They do learn they use search tools and create long term memories. Mechanically that is just tool use it isn’t magic. Do you need these things as emergent properties for them to be real? That would be cool but I don’t think it takes away what is possible now.
Can’t wait to end up holding the bag for this because they’re “too big to fail” again.
It’s always us normies that end up footing the bill and feeling the pain (sometimes literally to the point of dying).
Every fucking time.
So much of their revenue is government contracts. Especially with the Pentagon.
Really can’t be overstated how they’ve wormed themselves into the Military Industrial Complex.
A lot of their revenue is also investment from hardware and software vendors that are using the revenue from the AI companies for those investments.
It’s like the Enron scheme, but instead of one company inventing fake companies to move money around to increase revenue and drive up prices to hide the fact they’re hemorrhaging money while the C-suite tries to divest their own money from the company, it’s multiple companies working together to move money around to increase revenue and drive up prices to hide the fact they’re hemorrhaging money while the major investors try to find a way to cash out.
Anthropic is anxious to do their IPO because they know their business model is fucked, and their shareholders want out.
they’re hemorrhaging money
Are they? This is productive capital being rented out at a profit to the end users. And the end users are, as often as not, big public institutions with near bottomless accounts.
I might argue they are rapidly exhausting scare natural resources. And you’re welcome to do the material analysis on whether dumping 50 gal of water and 100 Mbtus of energy through a digital engine to make a “Farting Peach Says It’s Voting For The Green Party in 2026!” viral Facebook ad is benefiting humanity.
But merely observing that money is changing hands between big economic players doesn’t let us know if something is profitable. You’re describing the basic functions of a financial economy.
Anthropic is anxious to do their IPO because they know their business model is fucked
That’s the popular line. People said the same thing about Tesla when it went public.
Sound investment. Sounds like the echo down a dark tunnel.
thats about how much money Meta spent on trying to make the Metaverse work over a 4ish year period. Thats an insane amount of money for one company to spend in half a year. Like a mind-boggling amount of money. Even if you’ve made $16B in the same time frame, you’re still 5 times deeper in the hole
…that’s a shame.
That’s a lot of money that could have been spent on healthcare, food security, housing, transit, climate change problems…
That’s not how that works… the money “lost” isn’t going down the drain. It is… going somewhere, doing something useful. That’s why it is a loss to the company.
If it’s going to make LLMs it’s not as useful as the other things I listed. Paying a bunch of software engineers $300k each to work on LLM nonsense instead of something useful is a shame. Sure, the money isn’t set on fire, but the opportunity cost is large.
Your confusing fact with opinion.
Factually yes it’s useful to the company.
Your opinion is that the usefulness doesn’t justify it and this isn’t useful.
The real question is, is it useful enough. Which is likely no.
That’s at least 3 "your"s in this thread when it should be “you’re”. If you’re wondering why you’re getting down voted…
I’m not wondering nor do I see the point of downvotes? I will never understand the weird fixation with down votes.
Also I don’t even see these downvotes your talking about in the first place. My post appears to have no downvotes and one upvote to me.
So either something is broken here or your bullshiting for a reason I don’t understand.
I mean… A lot of the money is being spent on compute, which is just consuming electricity, which is many times made from coal or gas. So a lot literally is on fire.
The loss, up from $13 billion a year earlier, was driven by $72 billion in accounting charges tied to changes in the value of financial instruments Anthropic issued to raise money
This right here is how all of this will come crashing down. Anthropic and OpenAI, along with several associated companies, are using accounting tricks to hide their debts and obligations. These two are trying to maintain hype for investors so they can cash in on an IPO with total disregard for long-term fiscal sustainability. At some point the bill will come due, and you can bet the C-Suite will have already made out like bandits.
Modern companies are only profitable in late stage capitalism if they fall into one of they two categories: scams or gambling.
This right here is how all of this will come crashing down
No, this is pretty normal, and more importantly, doesn’t actually cost the company cash. They gave lenders bonds that can be converted to stock, so this loss on their books is pure paper loss, the same way wealth in owning stock in this money losing company is pure paper wealth.
These numbers are just illustration for simplicity, but imagine a company borrowing $20 billion and telling the lender that you’ll either pay back the $20 billion plus interest, or they can opt to convert it into stock worth 10% of the company. When the company is worth $100 billion, the bondholders won’t convert to stock. But if the value of the company shoots up on paper to where that same stock would be worth $100 billion, the lenders would rather take the stock than the cash repayment. And because it’s worth $80 billion more, the company will have to record that on the books as replacing $20 billion in bonds for $100 billion in stock, and an $80 billion loss compared to their last statement.
But look at the underlying financial cash flow. When that happens, the company actually takes $20 billion in debt off their books. They don’t have to repay that loan anymore. So it improves their cash flow position at exactly the same time that they’re booking a loss.
The whole thing will come crashing down for totally different reasons, relating to operational cash flow, not the actual accounting shenanigans where one kind of paper number gets converted to another kind of paper number.
It’s not entirely transparent though. It’s a paper loss in terms of cash but they did have to give the stock. At their crazy valuations, even 1% is a big deal.
While you explained this correctly (as far as I understand it), there is part of this everyone keeps making an assumption on the outcome, the “or they can opt to convert it into stock” part. I’m really curious what the interest rate they gave the early investors to entice them when the company was much further from a sure thing. If the interest rate was decent, that final number is going to start becoming awfully enticing to just collect on instead of getting stock that might collapse.
That’s the tradeoff, of course. If a company liquidates, it pays its debts first, then its preferred stockholders, then its common stockholders. But each step down the line gives a greater upside in exchange for less certainty in getting paid at all. Bondholders get paid at higher priority, but have the exact amount they get paid defined by a specific mathematical formula. So they won’t get any additional benefit from the company becoming super valuable. Or they can get in the back of the line to see what unlimited upside they have from the company’s value going up a lot.
Also, Anthropic’s bonds aren’t exactly low interest. They’re right there at the edge between junk bond and investment grade.
Don’t forget, though, that there’s another cashflow that they’re banking on: total surveillance.
AI can’t do a lot of things, but the thing it’s most suited for is creating a society run like a prison to try and keep the discontented masses in check.
This is my take as well.
Not enough people realize this. They think the component shortage is a side effect, but it’s to push you towards cloud services on underpowered devices that rely on it.
Imagine the censorship when every service is monitored and controlled by them. Imagine the market capture when they can see everyone’s financials and trade secrets. When they can cut off journalists and activists with one click.
Haven’t heard anything new lately, but there is a push to eliminate physical currency for, what I presume, is a similar reason -> make everything trackable.
People have been trying to eliminate physical currency for decades in not longer. That shit predates computers.
I’m not even sure it’s great at that. Is this not a function of any industry struggling to find a usecase eventually ending up with the largest US employer and cash cow: the DoD?
LLMs (‘AI’), not so great, but it can get (probabilistic, but fascists don’t care) descriptions of video feeds into easily searched text. Gobs of GPUs in datacenters paired with surveillance devices all over the place however presents a greater threat, where there’s an (evil) will, a way will be forthcoming. Nice of Ukraine to point out how fragile they are. There’s a deathstar analogy there somewhere.
Yeah, the type of people pushing this don’t even care about the inaccuracy either. If it “catches a black man” with facial recognition, even if it’s the wrong person it won’t matter “they are all criminal thugs anyway.” See also the ICE bull shit and basically deporting anyone even remotely Mexican looking, citizen or not.
Ai is a panopticon
The Italian government has just passed an emergency decree that authorizes AI-powered face recognition in public spaces without a judge’s authorization.
I dunno, isn’t this the same scheme that the ride share companies and food delivery services?
You mean the ones who had to massively pivot their entire business model, because they were relying on self-driving cars being practical in 2019?
With the difference that all those services mostly outsource their asset costs to their drivers or have very little investment there. Unlike anthropic who have billions in costs related to all the compute they need to service their customers (obligations to other companies, datacenters and, not to forget, ever rising interest on all their debt).
Definitely, the cost of doing business for these AI companies is orders of magnitude higher than Uber or Lyft
Here‘s for $80 billion more.
Noice!
We will observe a substantial rise in pricing at some point; afterward, cost-effectiveness will decline, and companies will scramble to put butts back into seats.
I’m guessing the lost funds are bleeding out to energy concerns. Correct? Asides from brief construction contracts for data centers, I’m unsure how one makes such large sums of money disappear.
There is a lot to unpack here, finance is interesting.
Investors spend money to build companies on the expectation that those companies will be worth more money than they spent in the future.
One way they spend that money is on the acquisition of bonds, which are firm guarantees against future debts. Bonds are often part of other financial structures (you’ll see them a lot in a hedge, which is a way to limit liability on an investment in exchange for some upside).
If I’m reading the article correctly, those bonds had a condition where they could be converted to shares at a certain price, so the investment and the hedge were part of the same instrument.
It’s not accurate to say that the money could have been deployed otherwise, one way to think about this is that large banks have very large, often self-issued, credit limits. Companies also have self-issued credit limits, related to the banks.
In this case specifically, some amount of this money is going to come out of the IPO, the 80 billion doesn’t exist in any other way.
tl;dr The 80 billion that ‘vanished’ here wasn’t actually spent on anything, it’s valuation against those bonds. It’s also an exciting headline.
Anyways, I hope this was helpful, these companies are definitely getting a lot of investment (running up their credit cards) in the hopes of a big payout, but this doesn’t have anything to do with private equities current running speculation on data center construction or power consumption, or any of those big problems.
From what I understood it’s not really money “lost”, it’s that the company was valued a certain amount and, with a bit of that hype dying down, it’s now valued 80 Billion less.
I’m not an expert on… pretty much any argument in this thread though, so if someone more knowledgeable can chime in I’d appreciate too.
Wonder how they’re going to spin ‘too big to fail’ this time.
“But it hasn’t destroyed humanity yet! You can’t let it fail right before it’s crowning achievement!”
“Super intelligence is too important”
Sigh…
Here it is.
When you want to distract the voters from something you are about to do that is massively unpopular, simply point them to a target. Chinese, communist, emigrants, you choose. You have the media machines to do it. Easy.
They ONLY lost eighty billion dollars??
♫ Sounds like someone is ready for a trillion dollar IPO… ♫
Still supposed to be valued 1.500.000 Million dollars. Lol.
this goes in line with thier aggresive pandering to the govt to be used mass surveillance.
