Some observers, including analysts for Goldman Sachs, say that the growth of AI since the height of the pandemic is now proving to be a bubble, like dotcom stocks in the late Clinton years or mortgage based derivatives in 2006-07. What is a bubble? By standard definition it is a growth in value of an asset that occurs after the speculative demand has surpassed the operational demand for same. If I buy X as a speculator at a price higher than the operational value of X can support I may be willing to make an operationally foolish deal in the expectation (on the speculation) that there will be a "greater fool" to whom I can then sell it. In such a situation, sooner or later the biggest fools ARE the ones who are holding X. What happens to its value then you can fill in for yourself. Clearly there is money still entering the field. The Peoples Republic of China is incubating a group of companies that it proudly calls the "little AI dragons," with seed money of...
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In the words of Graham Nash, “Teach, your children well, their father's hell, did slowly go by.” Those words, and the accompanying music, may well resonant Down Under, given the debate kicked up by the recent release of the “Review of the Australian Curriculum,” a final report after an independent review led by Prof. Ken Wiltshire and Dr. Kevin Donnelly . It results from a massive project, underway since the start of the year, inquiring into what “young people should be able to know, understand and be able to do following their time at school,” and whether the existing educational system in Australia is getting them there. The result has a global quality to it, comparing aspects of the Australian educational system to those in effect in (among other locales): England, Singapore, and the United States. What may interest readers of this blog, in whatever nation they reside, is the discussion of economics and economic history. Experts consulted generall...
Last month and this have seen dramatic developments in the world of bitcoin. Let's try to catch up. Bitcoin is one of a group of efforts to create a pseudo-currency online. Its existence is a testimony on how little trust exists for the legal tender of the US, the one-time world numeraire . An issue I discussed at book length here. There was a massive sell-off on Wednesday, April 10, which resumed on Thursday. Daily Bail Natural News Conspiracy theories abound, both as to the run-up in the value of bitcoins that began in July 2012 and in the crash in April 2013. My own view is that bitcoin has been (at least for now) the victim of its own enthusiasts, who got ahead of themselves. On March 29, Jeffrey Tucker of Laissez Faire Books wrote, "Maybe the price will keep climbing," etc. One of those this-time-its-different things that often get themselves written just before a bubble bursts. Robert Wenzel called him out. It appears Wenzel was right. Anyo...