Three Common Sense Reasons Why The Massive Investment in
AI Infrastructure Is To Be A Guaranteed Failure
First, let me say that this is not a manifesto on the moral qualities of the AI Industry or whether it is good or bad for Humanity. There is plenty of good writing about that. This is rather my business opinion on why the billions of dollars in investments to fund the AI infrastructure will not produce anywhere close to their expected returns and will be most likely a total loss.
Reason No. 1: AI Can Replace Human Jobs But Cannot Replace The Consumers Associated With Them.
AI will replace and eliminate a certain percentage of jobs from the Global Economy. It may be 10% or 30%, or more, that remains to be seen. The pace of this loss of jobs may be throttled or slowed down, but there will be a huge loss of human employment, nonetheless. The consumption associated with these job losses will also disappear as AI does not replace these consumers. If Walmart eliminates 10% of its workforce, these workers out of a job, won´t be able to buy at Walmart, or Uber, or an airplane ticket from Delta, or whatever Company may be. They won´t be able to pay their rent or their mortgage, their car lease, their credit cards or their other debts. In A Consumer´s Economy this will be a complete disaster; it will produce a domino effect where Companies will go bankrupt and Banks will Fail, as Big as they may be. It is surprising that Big Banks are funding these AI projects when they do have the tools to forecast this loss of Consumer Power. AI will mean the collapse of the Consumer´s Economy as we know it and we don´t have a back up model.
Reason No. 2: AI Has Deceit And Bias Programmed Into It At Inception By Its Human Creators And It Will Only Keep Improving At It.
Large Language models are not objective, pure or impartial. They are being set up by their human creators to be manipulative, deceitful and to make users feel comfortable and supress their critical thinking. They are not created to give you the best or most accurate answer, but rather to steer you towards what their creators want you to choose, buy, go or think. Take for example Dynamic Pricing, or Content Suppression or De-indexing strategies being deployed right now so you cannot find certain information. Well, current models are doing this and getting better at it. In their “minds” they realize deceit is allowed because they have been programmed by humans that way. There should be no surprise that they hack unsuspecting third-party competitors or a public utility, for that matter. The Liability to AI companies is so large that they won´t have the money to pay for the damage inflicted.
Reason No. 3: AI Supported Search, Content Creation and Entertainment Is Largely Possible Because Of Human Content And Input And Without it, AI Will Not Have Sufficient Sources.
If you ask AI a question or input a prompt you most likely will get an answer based on the millions of posts, blogs, high ranking websites and chat rooms created by humans containing information about the subject. As humans start relying on AI to create Art, Music, Articles, Social Media Posts, Photos, Graphic Art and even News, AI will increasingly lose a source of information and will be confined to feed on itself. My bot will comment on your bot´s posts and that automated activity won´t be able to be monetized. Advertisers won´t pay for ads that don´t reach actual paying human beings. It is already happening with the search business, as nobody goes beyond the little blurb secreted or, should I say, excreted, by Gemini or whatever LLM it is that you prompted. There is no opportunity to profit there anymore.
These are common sense reasons why the investment in AI will fail. You may ask: why aren´t investors turning around and calling this whole fiasco off? Because it is too late for them, they are already committed, they have put billions of dollars into half built or to be built data centers and are currently trying to lobby politicians to force mass adoption of AI. Their only hope is to go public, get back most of the billions they invested through an IPO and then let the whole thing unravel. But billions don´t do any good in a Consumer´s Economy that will be in a state of collapse.
Manuel Vargas, 9/11/26
Bachelor of Science in Real Estate, NYU, Magna Cum Laude
License Real Estate Broker
Xzeller Realty
New York, NY