this post was submitted on 21 Oct 2025

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295

Is there any way the average American can insulate themselves from the AI bubble bursting? (piefed.blahaj.zone)

submitted 2 days ago by compostgoblin@piefed.blahaj.zone to c/nostupidquestions@lemmy.world

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The entire US economy is currently being propped up by growth in the AI/tech sector. And I am convinced that LLMs are fundamentally incapable of delivering on the promises being made by the AI CEOs. That means there is a massive bubble that will eventually burst, probably taking the whole US economy with it.

Let’s say, for sake of argument, that I am a typical American. I work a job for a wage, but I’m mostly living paycheck to paycheck. I have maybe a little savings, and a retirement account with a little bit in it, but certainly not enough that I can retire anytime in the near future.

To what extent is it possible for someone like me, who doesn’t buy into the AI hype, to insulate themselves from the negative impact of the eventual collapse?

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[–] lechekaflan@lemmy.world 1 points 11 hours ago* (last edited 11 hours ago)

It makes me rage that even though I'm in a country thousands of miles away, its economy would be dragged down should economic collapse ever happens again in the US given heavy reliance on remittances from workers who are paid mostly in greenbacks.

The only glimmers of a chance of surviving such a catastrophe equivalent to tulip abuse would be not only investment in tangible goods and technical skills/trades -- short of becoming a prepper -- but also counting on policymakers' pragmatism to make my country more cooperative with its neighbors to cushion and weather the shock.

[–] amino@lemmy.blahaj.zone 12 points 1 day ago (1 children)

invest into real world assets instead of stocks. think of the infrastructure you'll need once everything stops working. food pantries, solar panels, ham radio, water purification, community self-defense, etc. basically solarpunk

[–] relianceschool@lemmy.world 4 points 10 hours ago (1 children)

This is all great stuff to have on hand, but not relevant for OP's question. They're wondering how to prepare for the equivalent of the dotcom burst or the 2008 recession, not a grid-down scenario.

[–] amino@lemmy.blahaj.zone 1 points 9 hours ago (1 children)

why I mention prepping and mutual aid strategies is because you can't pay for daily living expenses if there are no jobs and food becomes unaffordable. in 2008 millions of people became homeless so we need to learn from them how they survived

[–] relianceschool@lemmy.world 1 points 8 hours ago* (last edited 8 hours ago)

I don't see the AI bubble burst affecting people to the same degree; I think it'll wipe out a lot of investment portfolios, but non tech-sector jobs should be safe. I think it's useful to have some essentials on hand, but I wouldn't go on a buying spree if that means draining my savings; I'd rather have the flexibility of money. If it comes down to survival and you don't have savings, you could preemptively apply for lines of credit, use those to cover living expenses, and declare bankruptcy once they're wrung out. Not financial advice, but it's an effective stopgap.

[–] chunes@lemmy.world 14 points 1 day ago (1 children)

I would like to point out it's only recent gdp growth being propped up by ai. It's not like our entire economy relies on ai.

[–] Infinite@lemmy.zip 13 points 1 day ago (2 children)

The seven primary companies that are trading around the same tens of billions of "investment" and "credits" are worth 34% of the S&P 500.

Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, Tesla.

All of them are betting HARD, because CEO types think they can be first to market with the singularity and win. (That may be oversimplifying a bit, but every one of these companies is run by Nazi collaborators. Make stupid calls, win shitty reputation.)

[–] Ajen@sh.itjust.works 1 points 5 hours ago

While true, those companies all have solid revenue streams that aren't directly related to AI. If a bubble pops they'll all suffer, but all of them were profitable before the AI boom and can survive without it. It's very different from the dot bubble because that was driven by speculation and many companies weren't making any profit back then.

[–] YiddishMcSquidish@lemmy.today 1 points 11 hours ago (1 children)

I completely agree with most everything you said, but I will note that Apple is an outlier in that they are not investing deeply into ai. They are a shit company, and Tim Cook is most definitely a Nazi collaborator, but they are not a crutch of this current bullshit market.

[–] Infinite@lemmy.zip 3 points 10 hours ago

That's fair. They're behind, but definitely playing. "Apple Intelligence" has been around for a year, just badly under-developed.

Apple plans to 'significantly' grow AI investments, Cook says | TechCrunch

“We see AI as one of the most profound technologies of our lifetime. We are embedding it across our devices and platforms and across the company. We are also significantly growing our investments,” CEO Tim Cook said on the Q3 2025 earnings call with investors.

[–] General_Effort@lemmy.world 26 points 1 day ago (1 children)

It's also funny how Lemmy is buying up this narrative.

The entire US economy is currently being propped up by growth in the AI/tech sector.

What's happening is that Dementia Don is curb-stomping the US economy. AI investments, mainly in data centers, are the only thing that still seems promising. When you are on a trek and someone leads you through Death Valley, while pouring out all the water, you shouldn't blame the last horse that still keeps going.

Putting the blame in the right place would certainly help, with a view toward the mid-terms.

Financially: Diversify. Make sure that you are not completely dependent on what happens in the US. But mind that Europe comes with its own imponderable risks (ie Putin). Same with China. Maybe some old leader dies and the new crew runs everything into the ground; they go to war with Taiwan, that sort of thing.

[–] StripedMonkey@lemmy.zip 10 points 23 hours ago (1 children)

I don't know that the OP or anyone else necessarily disagrees with you here. It's one of the reasons that I believe we're fucked when the bubble pops. Every other sector is shrinking otherwise, which is only making the mania more extreme.

Trump has fucked the economy, but I don't expect the next administration to be able to pull off a miracle and fix the mess we've created within the next 10 years. Foreign relations and our status as the reserve currency are shot to hell. The US is going to have to answer for our behavior.

[–] YiddishMcSquidish@lemmy.today 1 points 11 hours ago

Those last two sentences are very alarming for anyone paying attention. The dollar bond market is currently collapsing, and we were THE defacto world power because of our soft power. Farmers around me are currently paying the price at China is buying up all the cheap land they can, and although I call them my friends,I can't help but feel a certain schadenfreude as I told them trump was evil 8 years ago and the only comeback they have is "but other countries were scared of us then!". Like their entire lives are nothing but a zero sum game, and now they can't sell their soybeans. I may be a terrible person, but at least I can read the tea leaves.

[–] SaveTheTuaHawk@lemmy.ca 26 points 1 day ago (1 children)

Divest and buy labubu dolls.

There is a good reason why Warren Buffet is holding so much cash right now, he will be bargain shopping soon.

[–] Rooster326@programming.dev 7 points 1 day ago (2 children)

Still don't get this take.

Buying low only works if you can sell high.

At the rate we are going. Yer gonna have King Ratfuck fighting King Shit over a an empire of dirt.

[–] YiddishMcSquidish@lemmy.today 2 points 11 hours ago

You don't think halliburton made bank off of Iraq? I'm talking outside of the government contracts. A failing economy is good business if you're flush.

[–] Seefoo@lemmy.world 5 points 1 day ago

This is how Berkshire has invested over the years. They try to time it, and buy the recession basically. When you're investing long term, you can either hold and ignore or sell early, losing a bit and buy again after the drop

[–] Blackmist@feddit.uk 19 points 1 day ago (15 children)

What did you do in 2020, when everything shut for COVID?

What did you do in 2008, when the arse fell out of the housing market?

What did you do in 2000, when the dotcom bubble popped?

Chances are the answer was "just shuffle on as normal, carry on living paycheck to paycheck, possibly get a new job if you work for somebody badly affected". Odds are your pension pot will recover by the time you need it.

What do rich people do? They gamble. Watch The Big Short. You could try that, but chances are you'll lose money. "The markets can remain irrational longer than you can remain solvent", as the old saying goes.

[–] SaveTheTuaHawk@lemmy.ca 2 points 12 hours ago (1 children)

“The markets can remain irrational longer than you can remain solvent”, as the old saying goes.

Some made big money in 2008.

[–] Blackmist@feddit.uk 2 points 10 hours ago

A lot more lost it.

[–] SocialMediaRefugee@lemmy.world 8 points 1 day ago

Buy low when everything crashes and wait for it to recover in 3-5 yrs.

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[–] 1984@lemmy.today 11 points 1 day ago

Buy other stocks, not American ones. They will also be affected but not as much.

If you are living paycheck to paycheck, you cant do anything.

[–] SoftestSapphic@lemmy.world 9 points 1 day ago* (last edited 1 day ago) (6 children)

Don't have money invested in the stock market to prevent it from losing value during downturns

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[–] AmericanEconomicThinkTank@lemmy.world 2 points 1 day ago

If you're worried about any economic downturn, you can very well diversify into even larger economic areas if you'd so please. How you do so is of course up to your own discression, given you can look towards different sectors, vectors of investment, and even geographic areas.

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