When Will The AI Bubble Burst?

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I started writing about the big Housing Bubble on March 26, 2005. It was obvious that there was going to be a crash. From that post,

The “For Sale” signs are sprouting like mushrooms. It probably won’t be long now.

It turned out to be long now, then. Until it wasn’t.

AI (And Stock. And Debt.) Bubble Burst Inevitable

It is obvious there has to be a crash to burst this AI bubble. It is inevitable. But this bubble, along with the stock bubble, is on top of (fueled by) the huge, worldwide “debt”* bubble. (See asterick explanation below.)

It is inevitable. But when?

Slowly, Then All At Once

Bubbles pop slowly, then all at once. (“Gradually and then suddenly.”)

The 2008 crash began slowly. The housing bubble itself peaked in 2006 and prices started down, rumors about bad loans and fraudulent collateralized debt obligation “tranches” circulated, but the fallout from that didn’t lead to the big financial panic until September, 2008. So 42 months. It began slowly, then, in September of 2008, all at once. But when it hit… it really hit. (Not that anyone was held accountable, of course.)

So when will the AI Bubble burst? The overall stock bubble will pop when the AI bubble pops. This all risks popping the huge, worldwide “debt” bubble. Worldwide financial collapse on an unimaginable scale. Great. Just great.

End-stage capitalism. Fun for all. Until it isn’t.

*The Asterick Explanation — About That $40 TRILLION US “Debt”

Debt is in quotes because the US government does not “borrow.” It creates dollars. “Mints” them. You don’t “borrow” something you make yourself. Governments sell bonds and pay interest, but that’s another topic.

People don’t know how banks get the money they loan out. They “create” it. They don’t actually HAVE the money, they just make it up out of thin air and deposit it into the account of the borrower. (They put the same amount on their books as money owed to them, so the books balance.) This is true, even though you can’t get your head around it.

Governments create money the same way. This is called a “fiat currency.” A “budget deficit” measures the money that is created by spending it into the economy without taxing it back out. The “national debt” is a measure of all the money the government has spent into the economy without taxing it back out.

$40 Trillion Floating Around At The Top

So the US government has created $40 trillion – the US National Debt. Because the system is rigged much of it has gone to the top few. Musk has a good-sized chunk of that just for himself. The other oligarchs have chunks of it. The rest is floating around at the top, various sovereign wealth funds and minor billionaires and hedge funds and such etc, all looking for places to put it and get a return. This is why there are big “asset bubbles” everywhere. Because “price go up.” (Until it doesn’t.)

The public could have had nice things. That money could have gone to fighting the climate crisis but the Green New Deal “cost too much.” It could have gone to healthcare and ending poverty and high-speed rail like China’s, and housing for everyone… A functioning democracy would have made sure that happened. But, as I said, the US “system” has become rigged to send much of the income and wealth ever upwards. Enshittification, etc.

So $40 trillion is floating around looking for ever-greater returns. AI looks promising, let’s cover the earth with data centers.

End-stage capitalism. Fun for all. Until it isn’t.

Warning To Politicians – People WILL Wake Up About Climate Crisis

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As heat waves and storms and drought get worse and worse it is inevitable that the public WILL wake up to what is happening with the climate. And when they do … you don’t want to be on the wrong side of it. Because, like what’s coming with the climate, that reaction it is going to be worse than you can even imagine and it will be aimed straight at you.

The Scientists Were Right

In the late 1800s scientists started warning that burning fossil fuels would cause the planet to heat. In 1968 the American Petroleum Institute was warned by scientists. In the 1970s Exxon’s scientists were warning management that the consequences of what they were doing would be catastrophic. The predictions were “breathtakingly accurate.” They knew they were destroying the climate, and chose to bribe governments and trick the public so they could put even more carbon into the air and make even more profit.

And now we’re entering the age of consequences.

It’s Bad And Will Get Much Much Worse

Consequences. If you experienced the heat waves and drought this year here is the bad news: It is not going to get any better. Because of the carbon that has already gone into the air this level of permanent temperature increase is already baked in.

And because of the carbon that is still going into the air it will get worse, and worse, and much, much worse.

Public Rage Is Inevitable

The warnings were there and the politicians ignored them. People are going to realize what has been done to them. It is inevitable. People can’t sit in the kind of heat we’re already experiencing without realizing something is wrong, and it is very, very bad. People are going to be very, very angry. Unimaginably, ragingly angry and completely justified in feeling that way.

People will be in a blaming mood. Will they blame YOU?

Are You To Blame?

Are you to blame? Will you be a target? The scientists were warning you. If you did not fight this with everything you have, you didn’t do enough. People will blame you for that.

Even worse, if you voted against efforts like a carbon tax or the Green New Deal you are complicit and it isn’t going to go well for you.

If you received money from oil & coal interests, that’s bad and it’s on the record. It will be far worse than having voted for the Iraq War. You might as well be exposed in the Epstein files writing, “Jeffery that you so much for sending me the container of 12-year-olds.” Your political career is over.

Just Get Out Of The Way Now

Unless you have been fighting the fight to stop the oil companies please read the tea leaves and just get out of the way. You’ve done enough damage and people can and will see it. Make room for people who are willing to try to fight what is coming.

Everything Is Extraction Now

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This post was first published at Government Cheese – Chronicling the collapse of democracy, because it belonged there.

Extraction

Everything is extraction now. Late-stage capitalism has turned into whatever you call the billionaires (and trillionaire) owning everything and extracting all the wealth from everywhere that’s left.

Their giant multinational monopolies buy up all the businesses. All the businesses extract all the local spending and transfer it to tax havens. The governments have to “borrow” their wealth back to keep running, then extract taxes to pay interest — to the billionaires.

The Final Extraction

There are still a few things left in the world to extract. Some people still have some equity in their homes. There are still some independent farms and businesses (in hock to the billionaires’ banks.)

The billionaires are circling the rest, though.

Until Collapse

Extraction at this extreme level has to lead to collapse.

Far too oil has been extracted, in spite of the warnings. The world has passed a 1.5C temperature increase and looks like 2C is already baked in. (Sorry for that one.) The climate is collapsing in front of our eyes.

Trump’s strategic failure in Iran will collapse the world economy.

That means the stock bubble will collapse.

The AI bubble will collapse.

The world debt bubble will collapse.

What Comes Next?

What comes after collapse? Who knows?

The billionaires will be in their bunkers, their slaves wearing shock collars to keep them in line. The rest of us will be bathing in our billionaire-funded propaganda bath… Will we still blame trans people and non-white migrants for everything? Everyone will BE migrants transitioning to starvation, so who knows?

Since no one will have any wealth left maybe the psychopaths will leave us all alone and everyone will be able to start over somehow. Who knows? (Yes, that’s a Bible reference. Leviticus 25:8-13)

Everything Is Trickle-Down Now

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This post was first published at Government Cheese – Chronicling the collapse of democracy, because it belonged there.

“Trickle-down” thinking – the idea that “growth” is driven by the rich, not by regular people with money to spend – led to competition for the crumbs that fall off the table where the wealthy feast. Cut taxes & wages & regulations, then businesses and the wealthy will come to you. So other states/countries cut their taxes & wages & regulations even more to get them back. Soon the wealthy have everything.

Democracies Defunded

Democracies have been defunded by tax cuts and competing “trade” deals, and the .01% have literally all the wealth in the world. So the only way to keep things going is to try to get the rich to park their wealth with you in hope some of it might “trickle down.”

So you set up a tax-dodging haven to “compete’ with other tax-dodging havens. You will make THEM poor so you can get the few crumbs that fall off the table.

If You Tax Them They’ll Leave

Be warned, “If you tax them they’ll leave.” If they leave the crumbs won’t trickle down! Please give us a few crumbs, sir!!!!

Everything is “trickle down” now! Everyone is betting everything on hope “they” will “invest” some of the wealth they took and you’ll be able to have some infrastructure or education or healthcare… (Of course, “they” will be getting their “return” for that. So even more gets drained away. But that’s tomorrow and you are desperate today.)

Now It’s Turkey

Now Turkey is offering special tax dodging “incentives” to “compete” to get those with vast “undeclared” wealth to bring it there because, “Dubai and Abu Dhabi, recent magnets for international wealth, have been tested by the US war in Iran and localized attacks, shaking their status as regional safe havens.”

Turkey seeks to capitalise on strategic location to attract the rich from London & Dubai
Ankara recently announced it’s ushering in a range of tax incentives for monied expats and investors abroad.

“… Turkey is seeking to capitalize on its strategic location to attract more rich residents as instability hits rival wealth hubs from London to Dubai.

The country recently announced it’s ushering in a range of tax incentives for monied expats and investors abroad, ranging from minimal inheritance tax, the chance for 20 years of overseas income free from local levies and an amnesty program to bring in undeclared assets held overseas.

[. . .] The new policies arrive at a sensitive time for some rival finance centers. Dubai and Abu Dhabi, recent magnets for international wealth, have been tested by the US war in Iran and localized attacks, shaking their status as regional safe havens.”

Just read the rest. It’s disgusting. This has been going on so long that even imagining democracy and the idea that the public can be in charge of things is gone.

Free Speech

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Here’s a free speech question. Rupert Murdoch and his Fox News, Rush Limbaugh and his “Libtards” and “Econazis” were part of an organized, strategic effort to dismantle American democracy and replace it with whatever you call what the country has now. We were all blasted with this evil, lying propaganda for decades. Civil society was destroyed. Good leaders were smeared with lies. Important public institutions were dismantled. Rule of law was removed. Etc etc etc. We all saw it happen. We all live in the world that created.

At the same time, related propaganda prevented us from dealing with the CO2 problem. Even as scientists warned us oil and coal companies pumped millions and millions into propaganda convincing people there was no problem, discrediting scientists, and fueling an increase in CO2 emissions.

Now corruption is endemic. A few wealthy people are ending up with all the wealth and lower for themselves and the country is an autocracy rules by one of the worst people in our history. We have oligarchs soaking up all the wealth. War is spreading across the world. And the climate crisis is upon us and growing in severity each year.

And all that is accelerating.

So does freedom of speech cover what was done to us? If so, can there ever be functioning democracy run for the good of the people?

24 Years of Seeing the Forest

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Seeing the Forest’s first post was on July 16, 2002.

That was the “Welcome” post. The next post was a real post.

Ralph Nader is a Scab
Posted on July 16, 2002 by Dave Johnson
In the union movement we learned the hard way that the only way to fight the moneyed interests is to stick together. It’s called SOLIDARITY. It’s what “union” MEANS.

When unions are in a fight the members stick together, and those crossing the lines are called “scabs”.

In the 2000 election it was the usual fragile Democratic coalition fighting the usual moneyed interests. Ralph Nader broke the solidarity, divided the coalition, and lost us the election. Ralph Nader is a scab.

The right always uses divide-and-conqueer to win. Sun Tzu wrote about it around 2500 years ago. “If his forces are united, separate them.” “If sovereign and subject are in accord, put division between them.” etc.

Imagine if Nader hadn’t divided the forces we now understand as anti-fascist. Gore would have won Florida and a few other states. The Iraq war would not have happened. The country would have started to fight the climate crisis. The Supreme Court (and everything else) would not be far right and corrupt…

Smiling Politicians With Kennedy Haircuts Issue Focus-Group Words

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This is a Seeing the Forest 24-year-anniversary poem. First published at Government Cheese – Chronicling the collapse of democracy because it belonged there.

Fossil-fueled psychopathic planetary pollution. Sew dependence reap profit and power. Smiling politicians with Kennedy haircuts and earnest, rolled-up sleeves issue focus-group words and wet their beaks.

Temperatures ever more extreme. The land becomes brown not green. Smoke from fires clogs our lungs. Species go extinct. Crops won’t grow.

It’s OK both sides do it radical terrorists say it’s wrong. Divisions are stoked and they are conquered.

It will trickle down.

Give Wind & Solar Electricity To The Public For Free

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This post was first published at Imagine Democracy – Imagining government of the people, by the people and for the people.

If we had a functioning democracy we would own our energy supply. We would build publicly-owned solar & wind and provide the electricity to each other and our businesses for free. Our economy would BOOM.

We would tax & redistribute the highest incomes & profits that result from this. Healthcare, education, transportation…

Australia is starting to do this.

People Don’t Even Remember That Countries Used To Tax The Rich

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Here is something that has been erased from people’s memories: The top income tax rate used to be 90%+ and the corporate tax rate was 52%. This was in both the US and UK. The inheritance tax on the rich was 77% in the US, 85% in the UK.

AFTER you took home a nice amount of income, then the rest, above a certain amount, was taxed a lot. People with high incomes were still quite well off, but these taxes prevented the extreme inequality we see all around us now. It also prevented the wealthiest from being able to buy the government.

And obviously there was plenty of investment. Society managed quite well.

Then It All Changed

Reagan and Thatcher changed all that, with “trickle-down” economics: If you give tons of money to the rich, then they will do what’s best for society and that money will “trickle down” to everyone else. They even promised that tax cuts would “pay for themselves.” This was a Republican talking point for decades!

Instead Of Taxing The Rich, Countries Now Borrow FROM The Rich And Pay Interest TO The Rich

Now instead of taxing the rich and doing things to make people’s lives better these countries “borrow” that money back FROM the rich and and pay “interest” TO the rich. The US pays interest payments of more than $1 TRILLION a year TO the rich. The UK pays over £110 billion.

And now these countries that used to do so much for the public say they’re “broke” so they can’t.

This can be undone, but only if you take the money out of the political system so these ultra-wealthy can’t just buy elections.

The First AI War

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This could be the first AI war. My experience with AI is it’s a confirmation bias machine.

This isn’t about being right, it’s about seeing responses that satisfy people that they are correct. But all AI is doing, still, is telling people what they want to hear. It’s just doing a better job of it! AI is not “getting better.” It is getting better at making you think it’s getting better. This is about accepting conclusions, not about drawing correct conclusions.

Never accept the first response. Challenge it and it gives you different answers, even apologizing for its first, incorrect answer. You keep doing that until you get an answer you like. But it’s the answer YOU like. If you challenged it again you’d get another, different response. You have to be well-disciplined in avoiding confirmation bias to recognize this is what’s happening.

Superior Advice From The God-Machine

I think that could be what they did. Trump and his people are well-disciplined in hearing what they want to hear. They thought they were getting superior advice from the God Machine, when all they were really doing what getting fed the justifications and strategies and tactics their twisted fascist brains wanted to get. No president agreed to attack Iran until there was a God-Machine telling him he was so great & strong so it would certainly succeed.