What could cause the AI bubble to pop? Here are the most likely candidates, in no particular order:
1. CHINESE COMPETITION: A Chinese company announces it has created a model that works almost as well as the best American model at a much lower price. Tech stock prices crater.
2. FAILURE OF A BIG AI PLAYER: It becomes obvious that one of the major American tech companies has fallen far behind the competition. Its value collapses; the ripple effects are felt throughout the economy.
3. OUT OF CONTROL AI: One of the models shuts down a major piece of American infrastructure in its quest to build a better paper clip. The regulatory backlash is fierce and immediate. Public faith in AI plummets, as do stock prices. Consumer spending follows, and a recession looms.
Even the AI optimists admit that there will be casualties as the models improve. In their view, however, they will just be bumps in the road. History, particularly with regard to railroad construction, tells us otherwise.