I agree, the core aspect of a ponzi scheme is that it redistributes the newly in...

jacobgkau · on Dec 31, 2024

Doesn't it hold true for investment in AI (or potentially any other industry that experiences a boom) in general?

Anyone who bought in at the ground floor is now rich. Anyone who buys in now is incentivized to try and keep getting more people to buy in so their investment will give a return regardless of if actual value is being created.

dartos · on Dec 31, 2024

If effect, kind of.

The money being invested does not go directly to investors.

It goes to the cost of R&D, which in turn increases the value of openai shares, then the early investors can sell those shares to realize those gains.

The difference between that and a ponzi is that the investment creates value which is reflected in the share price.

No value is created in a Ponzi scheme.

The actual dollar worth of the value generated is what people speculate on.

zekica · on Dec 31, 2024

Only a part of the value is created in OpenAI's stock valuation. Most of it is still a ponzi-like scheme.

dartos · on Dec 31, 2024

I have no love for openai, but they did make the fastest growing product of all time. There’s value in being the ones to do that.

I do agree it’s a very very thin line.

CRConrad · on Jan 7, 2025

> but they did make the fastest growing product of all time. There’s value in being the ones to do that.

Aha: So if my future line of Covid Cancer Candy takes off even faster, there's "value" in that, too?

What kind of value, exactly? Does the value of being "the fastest growing product of all time" not at all depend on what kind of product it is?

CRConrad · on Jan 7, 2025

Because "Open" AI keeps the newly invested funds only to themselves (with some scraps for employees), so early joiners don't (directly[1]) get any of the newly invested funds from later ones, you mean?

Yeah, true, not exactly a Ponzi scheme: This has even fewer redeeming qualities.

[1]: Only indirectly, by selling off their investment to that next sucker.