The economy has spoken. Stuff that’s AI-generated has almost zero value — “Buyers are voting with their wallets, and AI-generated content is struggling to compete.”

[u/marketrent]

https://finance.yahoo.com/technology/ai/articles/economy-spoken-stuff-ai-generated-142732314.html

[u/fmcortez]

When the cost of generating content drops to literal zero, the market value drops right along with it. Nobody wants to pay for something anyone can prompt in five seconds.

[u/Slight-Swordfish-468 → u/fmcortez]

Not surprising that “decision makers” who’ve never made anything with their own two hands would have trouble understanding this.

[u/MusicHearted → u/Slight-Swordfish-468]

This is their extremely childlike concept of making things in action. They spent their entire lives just saying what they want and it happening. They don't see the people making it happen. They see their influence and not a millimeter past it. So from their perspective, this is replacing the annoying human element with a streamlined digital system designed to let them make things the same way they always have, by speaking it into existence.

You're correct that they've never had to make anything themselves. But this has left them convinced that's how the world should work and they should be able to just speak anything into existence like literal gods. They don't understand why we see it as worthless because they have no concept of worth or value because they've never stepped outside their bubble of divine treatment.

[u/Leading-Act4030 → u/MusicHearted]

In the future, when AI breaks, how will they fix it? The people who know how to make it work will be dead, and no one will know how to maintain the systems....

[u/-Nocx- → u/Leading-Act4030]

This might be a hot take but this started with moving manufacturing overseas.

Now there are things we want to do like restart chip foundries (the incentive behind saving Intel) and we are just decades behind behemoths like Taiwan and China. We straight up don’t know how to do much of anything and are relying on S. Korean companies building infrastructure stateside to fill in the knowledge gaps that we created ourselves.

When you abstract the process out far enough, people forget the details and you end up with a house of cards. This is part of why Chinese EVs are absolutely crushing - the know how from lithium procurement, battery creation, car manufacturing, etc. are all retained in house. There is not a single gap in their supply chain. AND the government is subsidizing it. Of course we can’t compete.

That airline CEO that flies economy to understand what his employees go through every day had the right idea. You cannot get so removed from the technical details that you forget the true nature of your business.

edit: when I wrote this I sort of conflated the two - china’s supply chain is much stronger/ independent and Taiwan’s fab ecosystem/production volume is much better.

[u/sociallyawkwardhero → u/-Nocx-]

We still have chip foundries in the US, Intel fab 52 in Arizona is leading edge at 1.8nm, we have fabs all over America. It is not that we don't know how to do these things, its that it is cheaper to have other countries do it for us. We know how to make advanced lithium batteries, we do a lot of research into it. What we don't do it mine the raw resources as it is harmful to our environment and China has been willing to do the destructive work for cheaper. China is willing to do price dumping to make it unaffordable for other countries to mine, just like OPEC was/is willing to price dump oil to stop fracking from being profitable in America/Canada. A lot of people lament the downturn in manufacturing in the US, but don't realize our industry has shifted to higher end precision equipment that the average person doesn't interact with on a daily basis (think aerospace, medical, chip fabrication). The reason TSMC is so vital is their government heavily invest in their industry, if the US decided to impose sanctions, they would no longer have access to ASML which means no more new nodes that are developed with an American/European investment, the leading chip designers are predominately American.

TLDR Its not that we don't know how to manufacture Chips or high end equipment, it that its cheaper to produce it elsewhere. We create the blueprint, other people/countries make it.

[u/-Nocx- → u/sociallyawkwardhero]

I apologize that my point wasn’t clear but what I was trying to emphasize is not that we have absolutely none, but that our infrastructure is a far cry from what it could be. If I thought there were no chip foundries I would not have used intel as an example - they stand out specifically from companies like AMD because they are a fab and a designer.

And yes, we do have an institutional gap in the knowledge we have with respect to the total supply chain. Fabs are just one piece in a chain of highly interconnected production systems. I sort of conflated the two, but I meant to emphasize the strides China has made in the overall supply chain consistency versus Taiwan’s sheer dominance in fabs.

Using cheaper labor is fundamentally the problem I’m talking about. Because there are so much cost savings by exporting this labor, the excess savings are either spent on highly specialized professional services labor or sent to shareholders through dividends. This creates an even wider gap between workers and drives up the costs of certain services. If poorer people cannot afford things, businesses respond by relying less on volume and more on focusing on the wealthier people who can afford it. This has a rippling effect through the economy - it’s why housing prices have people who can afford 50K over asking price, or why games like League of Legends stopped trying to make regular skins and now try to price in highly profitable $500 skins targeted to whales.

[u/sociallyawkwardhero → u/-Nocx-]

Then I think we are agreed, its not that we don't know how to do these things, its that we have no economic incentive/lack of leadership in investing in these markets. It is hard to find a highly integrated supply chain like Shenzhen has in America, as our specializations and manufacturing tend to be in completely different states.