"The Riff" with Byrne Hobart and Erik Torenberg E54: How Bubbles Create The Future
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Nov 14, 2024 Dive into the transformative impact of technological change on markets, focusing on how economic bubbles foster innovation. Discover Amazon's strategic use of bubbles to drive AI advancements while grappling with implementation challenges. The discussion spans the evolution of online businesses and the cyclical nature of tech market bubbles, reflecting on lessons from the dot-com era. It also examines the role of political polling errors in shaping market reactions and highlights the surprising value of middlemen in enhancing buyer-seller relationships in the digital age.
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Rehabilitating Bubbles
- Bubbles are not just about pulling forward investments.
- They create infrastructure that wouldn't exist otherwise, driven by delusional optimism.
Amazon's Vision
- Amazon's early vision was to control the entire online shopping process, unlike a passive marketplace.
- This allowed them to set standards for online shopping and improve the customer experience.
AI's Potential and Limits
- AI models might hit data walls, limiting their improvement like other technologies.
- Deploying existing AI models still holds vast potential for productivity growth.
