Revenue is not profit. How are they going to pay their debts, for example? 6T in (fantasised) ARR is already about a third of US Fortune 500 total revenue over 2025, 21T. Good luck with that lol.
I actually explain exactly the plan here. I wrote an article explaining it. They intend to use several channels to socialize losses. The big ones are the front door. Literal bail outs and subsidies on multiple levels. The back door is passing it on to passive investors. At the beginning of next year we will see a near total economic collapse as this bubble bursts. Once it does passive investors will be wiped out. A whole generation of retirement savings and pension plans wiped out while simultaneously the fed will bail out the major players. Here is the article https://themildtake.com/articles/2026-06-05-priced-for-rescue/. Most people picked up on this when SpaceX went public. What they didn’t mention was even if your in the S&P that only shields you from a single bad player and a minor one at that. Microsoft, oracle, google all these big hyperscalers and service providers renting that compute are all going to take a dive.
If they do get bailed out, people better make sure they’re armed when they’re protesting because they’re almost certainly going to use illegal force to quash dissent of their theft.
So where do we move the retirement account investments to to avoid the bubble? I think most of mine are in stuff like mid-cap and large-cap funds
Move a slice of the large-cap into ex-US: VEU or VXUS if you can pick ETFs, or your plan’s international index fund. Mid-caps are already the less exposed half; you can’t dodge the bubble, only cut the concentration.
Great article. Thanks.
All of those DRAMs you can’t buy are in that number.
I guess the $6tn is also including wages not being paid. They think they can just pocket the pros of AI and leave the rest of the world population with the cons. A small analogy. If nobody does large agriculture, there won’t be many tractors and tools sold and maintained. There won’t be cheap grain to be processed into convenience food, animal feed, booze. With those there won’t be food, meat, dairy and eggs for the masses which again needs specialised tools and machinery. You can keep going with this into increasingly miniscule economic sectors.
The point I want to reach is drawing the picture of a propellerheaded youth sawing into the branch on which he is sitting - and with him the whole family of H.Sapiens.
Just another food for thought. Scientists expect the next ice age in 10 millennia but we are about to loose our advanced and highly specialised society to a manmade global warming. We surely won’t be dying out anytime soon I believe, but neither will we be to go into that ice age as an advanced society.
Even then. Let’s say that Ed Zitron has all the numbers wrong here and they’re actually double, just for the sake of the argument: that would mean OpenAI and Anthropic would have a current yearly revenue of 164.4b$. (And as said, they don’t!). Even if you double the Meta, Microsoft, Google revenue you’d still be at a mere 260b$. Even hilariously exaggerating the numbers doesn’t even come close to the completely insane 6T!
That’s just like my opinion. They think it’s worth that because their customers won’t need a single employee or very few. In many sectors manpower is the largest recurring position that can’t just sit there and be resold like land or a building. Manpower goes “stale” if it isn’t productive. A factory with bots can be shut down if needed and rebooted anytime goods or orders accumulate. Creativity can’t really be forced and with ai and enough input an “ideal model” of how the product should look like can just be remodeled and repainted to fit the newest trend.
That’s what every company might try, ditch their human employees for some ai agent and ai tokens, that might be where the $6tn comes from. A very big bubble blowing up and exploding right after the masses missed their third meal facing food anxiety, desperation, anger and going after anybody that looks vaguely rich to shatter their bones to suck their bone marrow. I hope Elmo gets it first.
Off topic, I know, but I’m curious what you’re reading about the next ice age. Always found that history interesting, but never thought to look toward the next one.
I frequent museums quite a lot and natural history is part of a lot of exhibits. They agree that we are on top of a warm cycle that keeps warming up because of man made factors.
Since we are disturbing the natural cycle in a way that is detrimental to the fundaments of our society, agriculture, it’s argued this will affect us during our lifetime - like it currently does, but worse is to come.For the ice ages of the past my understanding is that many many humanoids migrating from africa and evolving into different branches of homo have gone extinct during the ice ages.
My opinion is, we could see waves of refugees that brought down ancient and advanced societies like the hithites. Might be the hithites went down because they had to abandon their home because of drought. Ancient egypt, being forced into its knees, barely surviving, is a better studied era. Basically, bad times that has a global effect, people who can’t cope seek refuge in less affected or richet places, overburdening them and creating a domino effect of refuge seeking. This creates an armed cycle spiralling the world into chaos and taking away from and effectively disabling history writing and sciences, plunging the world deeper into the pit since the skills, tools and institutions needed for education and science are cultivated over many generations of itterations. Once shut down and anybody - able to use and create those tools, the knowledge to educate and do science, understand and derive knowledge from books and data - died off you can’t just boot it up again but have to create it from scratch.
AWS: 128B Alphabet : 402B Microsoft: 281B Meta: 201B
Total : 1T
So watch out for everything they charge for to double/treble in a couple of years
Edit: I see that some text is huge. I don’t understand why putting in hyphens seems to be doing that
But those are full revenue, including say MS Office subscriptions etc. If AI revenue needs to be 6T, then we need to talk AI revenue.
Yeah the management would add AI features to MS Office subscription, call it an AI product, treble the price and justify their AI investment
True that, but even then the dark magic of the street of walls will not save them
Imagine if this was invested in arresting climate change.
Instead they are literally posting trillions into accelerating climate change.
And arresting dissenters and innocent bystanders
And homelessness, and actual education for people.
Yeah, “and”.
You could probably actually solve a lot of problems in the world with this money.
Yeah, the party of “fiscal responsibility” is always like “WHERE WOULD WE GET THE MONEY FOR THAT?!!?!?” whenever it comes to a cause that’s actually important or would help people.
“The same place you always get the money for your greedy money-grubbing ventures that exclusively benefit you and your cronies” is what I would tell them.
If we just stop sending billions and trillions of dollars to the already rich, then maybe we could fix society and save the planet?
But no, there’s never “money for that”…
We always have money for other stuff.
Waiting for the bubble to pop. I need a new GPU and maybe a SSD.
Unfortunately the bubble popping will not provide you with better or cheaper access to those. At this point it is artificially created scarcity because they don’t want consumers to own hardware anymore. Even with the AI bubble popping, the tech oligarchs (with NVIDA at the helm) will still be pursuing their wet dreams of consumers having to subscribe to their cloudbased computers for everything.
I will quit the internet before I become a renter of everything I used to just use free.
You might, I think I would (at least personally, professionally I may not have a choice) but the vast majority of people will gladly go with this plan I suspect.
Look at car purchasing, most people don’t look at the sticker price or the total cost of ownership, they stop paying attention as long as their income can (and in a lot of cases it technically can but really shouldn’t) support the monthly payment.
Similar thing with new phones, most people buy a service plan that includes a lease or loan on a device. Very few people buy their sevice outright, because that’s a big purchase vs. a smaller monthly payment.
If there was a market for this for laptops, regular folks would eat it up.
That’s all opinion, so take it for what it’s worth. I hope I’m wrong. I’m fearful I’m not.
I love computers but never enough to participate in their plans.
I know how to read. Write. Draw. Go on walks. Play sports. Basically sit and watch paint dry than give a shit about not using a computer again
Free or one time purchase and possible payments for once in a while big updates. I don’t mind paying when the offer is good and I have money.
I am not paying google shit. Or any of them. I will join a privateering crew first.
You sort of can with solutions like MeshLLM
Other manufactures will arise then. Won’t be quick, won’t be painless, but the US is not the whole world.
You seem pretty sure about that. But where was the competition when they forced the switch to CD’s? The manufacturers are engaged in a shit-trust, and other anti-competitive behavior.
No one will step up.
Thats not… I feel like you weren’t alive yet when that transition happened.
Because CDs are objectively better in basically every way than VHS and cassette, especially for consumers. No more tapes stuck in the player, no more rewinding, no more randomly unspooled tapes, no more twisted ribbons, no more seeking static, no more heat warping, etc. plus cds take up less space overall, and you can easily use many-disc cd changers.
The market absolutely drove that transition, not manufacturers. VHS and cassette were still supported and produced for a LONG time after cds came about, because not everyone was willing to drop a ton of money to get their collection in a new format.
CD’s are not better. They scratch easily, and the players break. Like right away. I have vhs that still work, no cd player still works outside of a laptop or game consul, and the disks scratch and get ruined.
That you think they are better, ruins your credibility with me personally on this. You clearly don’t fucking get it.
I’m going to have to agree with the other guy. I have working VHS tapes and working CDs/DVDs that are both over 30 years old. That just means that you didn’t abuse them and kept them away from bad temperature and humidity ranges. CDs were so much better than cassettes that it wasn’t even funny. If you were abusing your CDs so much that they were getting scratched to hell, I can’t imagine you weren’t running into similar issues with your tapes. DVD were vastly better than VHS in much the same way. And the “better” wasn’t even about durability which was probably a wash as they failed in different ways. CDs had better audio quality and better quality of life for the user. You had no need to rewind/fast-forward. The audio didn’t get continually more staticy as time went on. They took up less storage space, especially if you used a CD wallet/book. You didn’t need to clean the heads on a CD player. All these same issues applied to DVD vs VHS other than skipping around a DVD is less common than a CD as movies and shows tend to be viewed sequentially.
Wow. Ok have fun with that personality… eesh.
Oh, the personality of not believing the oligarchs in the face of some credulous half wit? I will, thanks.
Ok so this is interesting. I am not sure this number is accurate I haven’t fully vetted it. I do this same type of forecasting. Morgan Stanley said for current capex commitments by 2027 4th quarter they needed to be 700 billion in profit. The problem is to meet that number they would need full market saturation and another 3 trillion in capex for build out. That means the entire accessible market would be using AI. They have another problem that more than half the world cannot access AI in its current form. The tooling these companies are using are wasteful and don’t meet the bandwidth needs of mobile first countries. So until the industry adopts things like https://codecai.net/ half the world’s markets are inaccessible. Finally they are under attack from all sides even if they had the money they may not have the ability to build out the AI infrastructure because that build out is becoming untenable for most communities. Even more the open source models and low cost AI are already in someways encroaching quickly on frontier systems. If you look at it right now the only reason you don’t have home AI as a commonplace solution is because the manufacturer has chosen not to sell it to you.
The local models thing is the real threat. For what 90% of the world who actually cares and wants AI, a local model is probably already “good enough”. Or would be if they could get the hardware, or maybe they don’t know how to set one up.
Got a 27b model running on my gaming GPU. Its a bit slow but good enough to look someing up, causual coding, and stupid questions. China is really kicking ass with the open source models.
Same, a 35B model is running on my gaming rig. It’s good enough for most things, even coding.
Just wish I had more VRAM and could load it faster.
If you look at it right now the only reason you don’t have home AI as a commonplace solution is because the manufacturer has chosen not to sell it to you.
And memory shortage. By buying up all RAM they ensured that you can’t run much more than lobotomized models.
up all RAM they ensured that you can’t run much more than lobotomized models. this is what I mean they’ve chosen to target a different consumer and rightfully so in that they are paying a premium for that product but they are also being subsidized by the same vendor so it’s not clear that they are paying more due to the bizarre circular funding pattern.
Light web searching suggests that neither the automobile industry as a whole nor the health insurance industry as a whole exceed $3 trillion in annual global revenue. Which means the plagiarism-to-slop pipeline just needs to make a little bit more than the automobile and health insurance industries combined to justify itself.
Also note Apple’s, AMD’s and NVIDIA’s (Spark) unified memory solutions for local LLMs/agents. AMD advertises 300B and NVIDIA advertises 200B models running locally. The question is whether Anthropic/OpenAI are going to be relevant at all in the future, with local models becoming increasingly capable and affordable. However: There are rumors the Chinese government wants to restrict access to its models. Not set in stone and also not sure whether this is true. Could this entail no more access to new open-source models? Who knows. But even then, energy and resources are going to be a bottleneck. I have not looked into the concrete numbers and this is not my field of expertise, but I find it highly unlikely that they are going to be able to capture the entire market.
This isn’t the same thing as making VCRs cheap enough that every home has one. There is no FOMO wirh AI at the consumer level, no one knows what to do with it. The only people who want it are the ones who male it!!
I’m just waiting for some breakthrough in the hardware and suddenly all of those data centers become outdated.
With the stories of AI being used to break into secure systems I wouldn’t be surprised if other nations also start throwing up walls to block them.
Fantastic. That’s USD 750 per Earth inhabitant. You could feed all of humanity for this, with is what is essentially needed.
You can still feed humanity with it… to Skynet.
Now all that is pissed away. We had our chance and threw it away.
Anthropic is claiming its total addressable market is over $30tn, so it’s all good, right? (No, that’s obviously crazy)
AI lab Anthropic, reportedly on the verge of a $2 trillion IPO, is preparing to tell investors that its total addressable market is worth more than $30 trillion, according to a report in the Wall Street Journal.
To put that figure in perspective, it eclipses the total GDP of China, is roughly equal to the entire GDP of the U.S., and represents about a quarter of the total world GDP of $120 trillion.
Eh total addressable market is such a meaningless figure anyway. Total addressable market is everyone who has a device that they can use AI from, multiplied by the average annual cost of using them. Plus every company that exists in the world, multiplied by how much the AI spend is for the average company. Plus every government in the world. Etc. Boom, 30 trillion. It’s like a super optimistic “this is the maximum that any AI company could ever earn per year if they controlled the whole market and everyone who could use AI is a paying customer”.
That 2 trillion valuation they seek is hella bogus either way. For 30 trillion actual revenue with any real profit margin, it would be low, but we all know they’re not bringing in trillions in revenue.
I wonder how much of that proclaimed TAM will be addressed with open models. I’m running Qwen 3.8 27B on my 7900 XTX and have no need to give Anthropic or OpenAI any of my money or data.
“Mercedes claims they have a total addressable market of $30 trillion by demonstrating that everyone has sold their vehicles and switched to driving a Mercedes on the new $20/month leasing program. Mercedes has not provided a response when asked how much their cars actually cost to own.”
The catch is that’s the amount of money it’ll be after inflations boom ;)
ez, just do some more hyperinflation. That’ll be about enough to buy a bag of rice
I’m pretty sure Ed Zitron has been keeping pretty good accounting numbers. Whether you think his predictions are right or wrong (the hype has outlived even my expectations), I think he’s right about how much debt has been generated vs how much cash will be needed to service that debt and it seems highly unlikely that we aren’t letting these companies pretend there’s a pot of gold under every blade of grass to our own detriment.
If it didn’t make sense, that’s because it’s early and I just woke up.
The world economy is about $126US trillion this year and $6tn if close to 5% of that total. Given that this is mainly US investment, the US economy is about $26tn so $6tn is about 23%. Huge numbers and I assume that there will be winnowing as the industry shakes out so most of that investment will evaporate as companies go under.
So there will be trillions spent on land and energy wasting data centers to get a dressed up ELIZA that will not solve a single world problem (like hunger, homelessness, poverty, ecological collapse). Simply great! Why not end capitalism right now? It is the only reasonable path at this point.
Someone asked me a couple of weeks ago why the New Zealand Green Party’s answer to all of our problems seemed to be taxes on rich people and big corporations. I said that it was because 40 years of neoliberalism had given us an economy that balanced a rise for the 1% with a fall for the 99%, and we should start trying to address that gently and legally before the 99% remember that a guillotine is 18th Century technology and can be easily constructed in a garage.
The end of capitalism isn’t too far off, the way things are going. And it’s going to be messy as hell.
Resist, resist, resist.
Boycott, boycott, boycott.Great, now a phonetic Batman villain has a say in the economy. Good. It’s just a joy to see, really.
So wild to see the mainstream media slowly accepting what I have been screaming to anyone who will listen for 4+ years now.
Better late than never?
I’m never letting anyone get over this. When I first heard about AI I was like, “oh, it might be interesting, but since it costs more to keep on than it makes in revenue it’s economically useless, right? Right, Anakin??” I now know how I would react during the Emperor’s New Clothes. That makes me feel good. Unfortunately, I also now know how most other people would react, too (“My, your grace, what a beautiful set of clothes you have! I can’t see your balls at all!”). That makes me feel scared for the future.
It’s proof of unsustainable AI bubble. Can’t hit those numbers. https://lemmy.ca/post/71626228/25584891
Finally a way to get endless Just Dance Vance videos combined with every type of kitten and alligator interaction video!
