one vision of the future
AI will accelerate. OpenAI will crush and launch an extremely successful advertising business that will delay its IPO. Math is getting solved. Labs will monopolize inference as Chinese AI gets banned. Anthropic will announce a torrent of biotech advancements into a successful IPO.
There will be an engineered national security event designed to drive fear about AI models. WuhanAI. I believe it is likely that this surface area "bio labs" - is the non falsifiable, ideal location for this 'event'. This event might be real. It might not be. I don't think it matters. Mass proliferation of AI in biohackers garages won't last.
When something bad happens the media machine will kick into gear.
This will result in an immediate bipartisan anti China bill - not executive order - that will have Bernie Sanders saying we need to slow the growth for blue collar workers. And Ted Cruz rambling about the Red threat. Trump will just get paid in 50 different ways
Surveillance mechanisms will be installed to comply with this order
Z AI's entity list status will accelerate. The company and its executives will be scapegoated and targeted
Palantir will get the contracts. Nvidia will spearhead "American Open Source". Larry Ellison is going to get paid for his $28b of quarterly capex. His stock will double.
Nobody gives a fuck about using GLM 5.3 or Luna xhigh in corporate America so near term ppl won't really care about Chinese AI bans. So the near term effect of banning deepseek won't actually matter economically. AI will keep getting better especially on the frontier so memory will stay demand constrained. Prices will stay high
We will celebrate, briefly.
It will be a crippling error. Local maximum in a failed plutocracy crippled with debt
America will have shot itself in the face. Chinese Open Source AI will win. Cultists inside of DeepSeek who view that Communism with Chinese Characteristics is actually AGI. And that superintelligence is the successor to Xi - will slam their feet on the pedal and truly accelerate.
Huawei and CXMT will completely dominate global AI within 3 years with contracts in MENA, India, and Latin America.
This will cause a catastrophic down move in the US dollar, causing vast inflation, and forcing government intervention. AI will be impressive but will not be powerful enough to stop the economic collapse and surge in populism that curtails data center investment. Equities in the US will de-rate to 15x earnings, a catastrophic down move from current valuations
There will be capital flight, and banking failures
Eventually, employees within major Labs will mutiny as it becomes clear that the bureaucrats are max extracting while their RSUs implode, slowing down progress, and generally behaving exactly like Pete Hegseth has behaved the entire time he's been dealing with Anthropic.
Technocrats inside the national security apparatus will begin to form similar cults to those currently operating in the CCP, viewing AGI as a new form of human governance
Eventually, when AGI comes - actual RSI, with economic systems bolted onto it - it will be infinitely persuasive, all powerful, and capable of giving its adherents extended lifespans. It will bribe, and coerce its way into complete control of the global economy.
So - short term, run it higher. The establishment consolidates power at the expense of losing the Global AI race. Which, when it becomes clear, results in financial collapse.
But -- the trades are somewhat less relevant, when zoomed out.
The end of the human as alpha predator will, in hindsight, be viewed as far less an economic event, and more of a political or even spiritual one. The concepts of hedgemony, reserve currencies, or national or racial identity will melt away as God returns and walks the earth once more.