Bonum Certa Men Certa

The 'Clown Computing' and 'AI' Bubble



Reprinted with permission from Ryan

"AI” frightens me.



No, not the thought of living in the Future War of The Terminator. Skynet said that it “evolves in seconds”. ChatGPT, Dall-E, and Bard still get simple interest wrong and can’t tell me what things will cost when I ask them to factor in coupons or rebates.



NPR’s article about “AI” building rockets that would explode if anyone tried building them was just amusing. We’re a long way off from rockets when GPT and Bard can’t tell me how much interest $1,000 will make in 5 years if I put it in a CD that compounds daily at a given APY.



The entire point of “generative AI” is to create a seductive mirage for stock investors.



Google and Microsoft are examples of giant tech companies whose established products are still fairly widely used despite having degenerated quite a bit.



Google and Microsoft Bing search are an arm of the state propaganda mills, and Windows 11 is noticeably slower than Windows 10 even on faster hardware, carrying on Microsoft’s usual tradition there, and even Windows XP was more reliable in terms of uptime and hotfixes and service packs installing and rebooting successfully.



According to Gartner (which itself is Microsoft-affiliated), PC shipments have fallen more than 30% in the first quarter of 2023 vs. the comparable period last year, and so new PCs sales are not happening. Are people switching to Macs? Apple had the worst decline of a single OEM. Even worst than Lenovo.



Microsoft has basically given up on demanding “TPM 2.0” or new PCs, and has unofficially started trying to cannibalize all the Windows 10 systems it can by waving them through. Figuring that they’ll at least make some extra money with all of the additional adware and spyware if they can’t sell you on a new PC?



No, Microsoft said that they would make money with “Cloud”, but even Yahoo Finance articles admit that “Cloud” revenue growth is slowing and will be a disappointing miss.



There’s simply nothing here to justify MSFT stock nearly doubling in the last few years and it’s time to dump it if you have it.



Every major company, even Coca-Cola (we don’t want your White money), has “plans” to “Chaff Bot” now. This has jumped the shark already and they’ve been at it for less than 60 days. Amazing!



Consider the amount of money and potential being wasted to juice the stocks while the important people dump shares and, hey it’s not insider trading if it’s scheduled, right? 😉



Bill Gates himself has to know full well that GPT is a great big fat nothingburger, but the speculation makes him other people’s money, so he’s buying columns talking it up about how it will teach your kids to read. (Don’t teachers already do this?)



The “AI” bullshit was a major factor in my decision to exit stocks in the retirement portfolio recently. I expect the bond fund to right-size because those are binding obligations to pay and with a very low default rate, and prioritized during bankruptcy proceedings.



(Like Bed, Bath, and Beyond…. Now if only they had put out a press release about using AI to sell people coffee makers and pillows, and sold shares are horrifically inflated costs with no promise to pay anyone back.)



Walmart recently fired their global chief of marketing. This is the guy that said they were going to start selling NFTs and taking Cryptocurrency.



I read a news article today about the US Government’s war on crypto. At first it was just the IRS, then it was the New York “Department of Financial Services”, and now it’s the SEC.



The SEC just issued a notice to Coinbase that is the final step, usually, before criminal charges. Coinbase is threatening to exit the United States.



There are no Crypto exchanges you can trust. Ask FTX and Celsius customers.



Ask people who used Uphold and have Uphold freezing their account or money disappearing, and nobody from Uphold will talk to them.



Crypto had its day. Now these companies are saying there’s “AI”.



The reason why Microsoft can burn so much time in Azure to run GPT is because they weren’t doing anything with it. It was sitting there as dead, unsold, capacity.



They’ve cooked up this thing, and it’s an utter scam, and people will lose their life savings if they don’t get out quickly.



Investors should take serious note of the fact that while Microsoft is trumpeting an AI that returns false information, and can’t be fixed, they fire thousands of people in Bing, Edge, and other divisions that are responsible, theoretically, for fixing it.



It shows that their plans are, in fact, to deceive investors about what the potential future applications for generative AI really are, and not to fix it, and to dump inflated shares before the little people using Robinhood and their 401(k) to invest in Microsoft lose their asses on it.



MSFT stock

This is a picture of the history of Microsoft stock.



When a stock moves like this, tread very lightly.



You see that little bump way back between 1986 and 2004?



That was around 1998-2001. The DotCom Bubble.



Hardly a blip compared to what’s been building up recently.



Microsoft isn’t alone at severely overvalued “tech” companies.



There is a wipeout coming.



And it’s not only fraudulent accounting, “AI” hype, and such. It’s not just “irrational exuberance” as Alan Greenspan might say.



A lot of it is also legal embezzlement, known as “share buybacks”, which are done to increase executive pay. Share buybacks should be illegal. They don’t add value. They destroy value.



Democrats in Congress put a 1% tax on share buybacks into law.



That’s better than nothing (which is what the Republicans want), but it doesn’t do very much to discourage them.



It’s saying “We’re going to let you do something incredibly wrong and fraudulent, but we want some money first.”



Captured government.



Don’t look for the government to help you. They’re figuring out how to shut down your retirement money and take it all back so they can bail banks out again; so they can run Super-TARPs.



As an investor in a retirement plan, there’s just not many safe options, but given that last year was already the worst year in 250 years for Bonds, I think that other people have taken the hit and fixed income will be the name of the game for a while.



I think that Gold and Silver could do well too. At some point, the large market caps are going to have to be companies that really make things and mine things and build things again. This tech surge is a seductive mirage.



“Intellectual Property” is just a fancy way of saying “slavery with extra steps”. It’s a way to extract rents from the productive sectors using nothing but the threat of law.



That being said, while some companies do make money like this, it’s normally a form of economic parasitism. “Non-Practicing Entities” and “Patent Trolls” come to mind, but Microsoft operates like this too, and it ruins companies that made stuff.



I was reading my email today, and Samsung emailed me about having until July to remove everything from “Samsung Cloud” before it got deleted.



I don’t even have a Samsung phone anymore. They turned a loyal customer into “Eww, Samsung.” with the increasingly buggy firmwares, and shoveling Microsoft crap into the phone and making it impossible to remove fully.



Then when I found secret Facebook spyware running in the background by default (“facebook service” or something), it was the last straw. I wiped the phone (which was malfunctioning anyway thanks to T-Mobile making my Sprint phone, which they sold me, incompatible with their network), and used T-Mobile’s buyback to switch to a Pixel.



Microsoft doesn’t add value, they ruin it. I can’t imagine that I was the only Samsung phone user who saw Microsoft Microsoft Microsoft popping up everywhere and went “LOL, no!”.



Bill Gates said in one of his “Creepy Uncle Says” articles the other day, that his “biggest mistake” was not “making Windows Phone what Android is today”, when “that was a natural place for Microsoft to be”.



Microsoft had Windows Phones, and they were cheap. Nobody wanted them. The only way they could dispose of them was selling them at a loss to Cricket Wireless customers with bad FICO scores and writing them off their taxes.



But they came back and forced themselves, as in rape, on people who used something else. That’s what they do. They corrupt and corrode. Samsung is finished.



The Galaxy S20 was the worst tech thing I ever bought, and I’m just glad I didn’t end up selling it to Amazon for a bag of cat food because T-Mobile offered me a 100% credit for giving it back.



It was such a bad phone (mostly because of the Microsoft deal) that I went in and said “Show me the iPhones and the Google phones.”



And almost like some sort of horrible comedy, the guy says “We’ll give you a Galaxy S22 if you want one.” I was like, “No.” He says, “Well it is a more expensive phone.” and I replied, “Well then anyone who pays that and gets another Samsung has my sympathy.”



Microsoft can’t seem to really enter into new markets, but it can do an enormous amount of damage on the way down. It’s basically turning Samsung into the sequel of what happened to Nokia.



There’s no telling exactly when this stock market is coming down, but it is probably “soon” and when it does, it will come down hard, and they’re not going to tell you when they plan to do it to you.



The people gravitating towards Microsoft and its ilk will get burned worse than others.



In the meantime, we can all enjoy the comedy. CNBC calls the Business Software Alliance (a legal trolling outfit operated by Microsoft, Adobe, and a few others, best known for running ads encouraging people to rat their employers out for “unlicensed software”) a “tech advocacy group” calling for “AI regulations”.

:/



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