Low-resource open source developers pretty much screwed now

blackbird9 said:
"An artificial-intelligence bust (and thus bubble), inflation and fiscal stress are the three the most alarming threats to global prosperity at present, the Bank for International Settlements warned."
The full BIS report is here:-
www.bis.org

Annual Economic Report 2026

This year's Annual Economic Report examines how the global economy is faring as progress meets rising perils – including a new fiscal-financial stability nexus and shifting inflation dynamics.
www.bis.org www.bis.org

"The assessment highlighted AI-led risks prominently in a report that arrived on the eve of the ECB’s three-day annual symposium in Sintra, where a host of global policymakers will also scrutinize such stability dangers closely."

Of course, they are questioning the current AI and semi stocks valuations; who wouldn't, really. Look at these two sets of charts. Capex expected to reach 800 bn dollars this year; it's getting close to a trillion.
View attachment 26655


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“Disappointment in returns could trigger a sudden pullback in financing and turn the capex boom into a protracted investment bust, with potential knock-on effects on financial conditions,” the BIS said, before observing that “a major equity-market correction could have larger macroeconomic consequences today than in the past.”
"On AI specifically, officials highlighted vulnerabilities linked to funding, including complex arrangements such so-called “circular financing” deals that can mix equity and debt with supplier-client contracts"
- in other words, companies buying each other's stuff in a circular pattern, all ultimately dependent on the current astronomical stocks valuations.

In essence, they are saying we may well be in DotCom 2.0. All we can do is 'watch this space', I guess. Admittedly, not a staggeringly surprising conclusion, however, for the normally rather staid and reserved BIS to come out and say so publically, is noteworthy. Let's hope we don't get "dotcom crash 2.0" at some point in the next couple of years.

A couple of other headlines I noticed today.

GM replaces 1000 factory workers with robots.
finance.yahoo.com

GM Fired Over 1,000 Factory Zero Workers And Installed 50 Robots

General Motors is facing renewed scrutiny over automation at its flagship EV assembly plant after adding dozens of robots to the production line months after cutting more than 1,000 jobs. The changes at Factory Zero ... Read more
finance.yahoo.com finance.yahoo.com

BAT fires 9000 workers, 1/5 of its workforce, to be replaced by AI.

And it seems 'tokenmaxxing' is suddenly a thing of the past in the Valley, who knew? For once, actually quite a well written article, from the torygraph.
“No one is safe anymore. Morale is down the toilet." Was anyone ever "safe"? 😟

It's not just open-source developers, who are feeling the pinch.
Click to expand...
When the bubble bursts at least we will be left with tons of GPUs.
After Dot Com, we only got cables to nowhere rotting in ground and domain names.
 
A writer on 4SYSOPS replied to me that he thinks windows (et al) will go away once AI takes over the user interface.

This may be true for corporate drones, but IMO not the case for millions of SOHO and private users.

I am old and retired and have less than zero interest in AI on my machines. Zilch.

I remove copilot, BitLocker, secure boot and every nanny, spy app and telemetry marketing app I can find on win10 and refuse to use win11 except for TurboTax once per year in a VM.
 
cracauer@ said:
All this AI craze has a very unfortunate side effect.

For 30 years you could do open source development on a potato PC that some windows user put in the trash. If you really wanted to rebuild the godzillas (chromium, rust, electron) you could spend $1000 on a mainboard/CPU/RAM combo that made it reasonably swift. You were competitive. Somebody sitting inside Google with a ninja macho machine did not have a significant advantage over you.

With LLMs that changes. You either need a monthly subscription to an AI service (and the $20/month option doesn't reach very far), or you need hardware to run an LLM locally. You'd spend about $3500, which gets you either:
  • An NVidia 5090 (FreeBSD or Linux)
  • A Strix Halo AMD Ryzen 395 system with 128 GB (unclear whether FreeBSD will do a Vulkan-backed LLM on here). This purchase also helps with compile times
  • A Mac Studio with 128 GB (stuck with macOS). No longer sold by Apple, now you need a more expensive MacBook Pro

That is very much unaffordable for many volunteer developers, especially those who are still students. If your project is popular enough you can beg Anthropic for credits, but only a small minority gets those. Hopefully you have parents with some money who want to push your carreer.


And that doesn't begin to touch on the second problem here, which is that those $1000 mainboard/CPU/RAM combos are gone now, the RAM is no longer included. Thanks to AI companies driving up the prices of RAM, SSDs and HDDs. So right now you cannot afford a chromium master for non-LLM work either.
Click to expand...
Prices of RAM sky high should incentive new producers of chips to open shop. And invest in better manufacturing.
The result might be more and cheaper RAM.
It is also possible that GPU will be taken over by NPU or TPU. It seems GPUs are preffered because of CUDA familiarity. Paradoxically AI can help to familiarize developers with new frameworks, not attached to GPU.

However this applies only to free market incentives. And we don't have those from 1913 when capital stopped being created by carefully accumulating profits but is created by the bureaucratic fiat of the cartel around central bank.

1609836310531.png
 
The lead time and enormous expense of a new chip fab is staggering.

I saw the same bubble with firearms, reloading supplies and primers. The prices did drop a bit when it stabilized but never returned to the pre-scare pricing.

Inflation is the way of it.
In my life time I have seen gasoline at $0.17 per gallon, a new Chevy van for $2700 and 22 ammo for $0.50 per box. These prices will never, ever come again.

Neither will cheap DRAM.
 
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