Newsletter: Goldman Sachs has called BS on Generative AI, and I believe that it's time that everybody follows suit - generative AI is unreliable, unsustainable, requires an entire rebuild of America's power grid, and is most decidedly not the future.
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Goldman Sachs recently issued a report called "GenAI: Too Much Spend, Too Little Benefit?" savaging the industry, with GS' Jim Covello saying that there's limited upside, and that it's incapable of solving the complex problems that would make it worth it.
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Sachs' report is brutal, and finally asks some very blunt questions: what does generative AI actually do? And when we say it'll "get better," what does that actually mean, and how does that justify the massive costs and errors associated with LLMs?
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What do we get from all of this investment, stolen training data, and strain on the power grid? The answer is not much - Daron Acemoglu of MIT believes that GDP and productivity growth from Gen. AI is "much more limited than forecasters expect."
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The lone pro-Generative AI part of the GS report is a mess, making leaps of logic to suggest LLMs will lead to an AGI with human consciousness - something that researchers have repeatedly proven isn't possible. Gen. AI fanatics live in a fantasy land.
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Those replacing human beings with AI are doing so because they've no respect/understanding of labor, commoditizing outputs without seeing that a job is both the acquisition of labor and the outsourcing of risk. You don't just hire humans- you trust them.
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The most brutal part of the report was from Goldman Sachs' Head of Global Equity Research Jim Covello, one of the most technical and well-respected analysts in tech. He thinks Gen. AI is full of shit- and nothing like the early days of the internet at all.
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Goldman Sachs' Covello dismisses the suggestion that tech starts off expensive and gets cheaper over time as "revisionist history," and that "the tech world is too complacent in the assumption that AI costs will decline substantially over time."
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Sachs' Covello estimates that a trillion dollars is being invested in propping up generative AI, yet it doesn't solve a one-trillion-dollar problem. It isn't making money, it costs too much, it doesn't create new jobs and doesn't make workers smarter.
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On top of Generative AI having no killer apps and barely increasing GDP and productivity, Goldman Sachs also reports that to make generative AI grow much further *will require a rebuild of the American power grid*. This is insane! It's not worth it! Stop!
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For those reading this and suggesting that generative AI will thrive because OpenAI and other AI companies have a big secret thing to reveal, I have a counterpoint: no they don't. We've hit peak generative AI, LLMs won't make AGI happen. It's time to stop.
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When the generative AI bubble bursts, big tech will be sitting on acres of unused data centers, and have burned billions of dollars building our the infrastructure for a movement that isn't making anyone money and doesn't fix big, important problems.
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Gen. AI fanatics live in a fantasy land - where getting their hands on insane amounts of money is the -only- point
- just another failed capitalism thing
More to the point: _it's not going to happen_. If your project requires a rebuild of a continental power grid in order to become profitable... you don't have a profitable project!
I mean, it's not "revisionist history" as we normally mean it. That technology really did get cheaper over time.
It's just that there's no reason to believe the same phenomenon applies to generative AI, & some good reasons to believe it doesn't.
Love the "What trillion dollar problem is AI solving?" Sounds like Clayton Christensen -" What is the job to be done." - What is the job that consumers need AI to do?" Flying by the seat of pants then raming into business will have disastrous outcomes.
worth noting the people pushing for this don't have a concept of "trust"
they understand only that their money buys labor, and labor to them is an interchangeable and fungible commodity; they have no concept of experience or expertise, only that things happen if you throw enough bodies at a problem
