Although I didn’t predict this AI, it isn’t too surprising. GoogleMind shocked the go world with AlphaGo. Kejie, the best go player in China, cried when AI beat him. His mind was blown. But Chinese programmers recovered quickly and came out with several of their own powerful go playing AIs.
But the shocking thing is the DeepSeek claims they only spent $5.6 million building their model. American tech giants are claiming they need tens of billions. A lot of that money would have gone into energy.
In other words, DeepSeek is claiming a 99.99% efficiency improvement. That’s newsworthy.
That’s largely because the Chinese are using the infrastructure developed with those billions of dollars, and are pirating the data with which deepseek operates. Nothing new here.
No, the big cost is the chips and the energy to run the chips. That’s why NVidia’s stock got hammered today.
DeepSeek will have used their own farm or paid for someone else to run their training. There’s nothing to steal here.
On the energy side, one possibility is that they were piggybacking on solar Bitcoin miners. On the one hand the Musk side of the Trump presidency is pushing Bitcoin, but on the other hand Beijing is cracking down. Bitcoin miners have built huge solar farms in Chinese Central Asia. So if they have excess capacity that could explain the energy side.
Hard times for Bitcoin miners could also explain where they got the chips. GPUs are use for coin mining and AI, as well as for their original use, fancy graphics.
The timing seems odd though.
About the idea that the Chinese steal everything from the West, I worked for Taiwanese companies in the 1990s, when they were taking the PC mainboard market away from American manufacturers. This is what I noticed at the time: It is often said that cheap labor is on reason why Asian companies excel. There is some truth in that. But it isn’t just sweatshop workers. Cheap engineers are the reason it is so hard to compete with emerging markets on technology. They aren’t better or worse or more or less prone to stealing ideas than expensive engineers, but there are a lot more of them. Put ten decently trained engineers on your mainboard project full time and chances are you’ll outcompete a company that can only afford two or three.
I appreciate the comments. Although not in the position to add to much, I would say it would be wrong to underestimate the intelligent people that must be behind both making the physical chips and also the software. Extrapolating expertise and knowledge. AI works very well in some applications though – just talking from personal experience.
Apparently AIs are often used in thesises and such now, but also in research grant applications, perhaps one would need an AI to examine those to find them?
Preferably a different one than the one writing it…
(But on the other hand, if it´s a good idea but you´re a poor writer, it might be a good thing to use?)
Interesting times for sure, have some NVIDIA graphics boards but no position, luckily.
There’s really nothing novel or good about LLMs as they are. The Chinese ones being more efficient just means we can kill the private equity and venture capital firms dumping hundreds of billions into this stupid bubble to get rid of workers via shitty chatbots.
NVIDIA is up today, but for how long? Literally the only stocks doing well are the Big Tech ones that are in on this crazy fad because they literally have no other growth potential revenue streams on the horizon.
The ugly face of reality. Ugly if you’re an elephant, dolphin or human.
COAL CONTINUES TO DOMINATE CHINA’S ENERGY LANDSCAPE
• China’s thermal power generation, primarily fueled by coal, reached a record high in 2024 despite a surge in renewable energy installations.
• Coal consumption continues to grow in China’s electricity sector, driven by increasing power demand and the need for a reliable baseload power source.
• China’s coal imports and domestic production are expected to rise further in 2025, solidifying coal’s role as the backbone of the country’s energy system.
“Coal consumption in the electricity sector continues to grow and so are China’s production and imports. The persistent growth in Chinese coal demand, including for power generation, goes to show that coal remains the baseload of China’s power system to back up the surge in renewables and will stay such for years to come as power demand jumps with the increasing electrification of homes and transport.
The Chinese growth in coal consumption defies previous views that coal use is peaking in the world’s biggest consumer of the fossil fuel.”
Yeah, the market is very frothy. NVidia lost $1.2 trillion at one point, but bounced back.
Deepseek claims it was using nerfed NVIDIA chips they bought for coin mining and stock market trading. Nerfed because the US government doesn’t allow NVidia to export the highest end chips to China.
This reminds me of the 1970s when the American government kept gas cheap but Japan taxed it heavily. So Japanese companies built fuel efficient cars and American companies built terrible inefficient cars (The 70s really were the low point of American cars.) Then there was a oil price spike and the Japanese hammered the American car (and motorcycle) industry.
With respect to Trump’s taking virtually all departments to the woodshed: On the one hand all organizations – when not pruned on a regular basis the tend to accumulate excess fat – but on the other hand his clearly vindictive and red meat baiting way of going about things is not about increasing efficiency and effectiveness but about revenge and pacifying some of his base. So it is possible that at the end government may be more rational ( when closing ones eyes to blatant grift) and in better shape.
Trying to be optimistic here so please have mercy…..
It may in the end be good for the environment because the end result may be a Worldwide Depression, the $25/b prediction of HHH may soon come to pass, but not for the specific reasons he claimed, just from an unchecked lunatic in the White House making very bad decisions leading to chaos and a crash in the World Economy.
This recent US election may disprove the old adage that Democracy is the worst form of government, except for all the others.
I’m actually impressed Trump is beating even my expectations in dismantling America. I know him and Musk talked about crashing the economy. I just thought it was going to be in months, not days at this rate.
It’s perversely refreshing to see direct action so quickly form this way. Like the executive has remembered they can do stuff. Unfortunately, that stuff is “move fast and break things” at a national level.
The rightwards lurch seems to be a global one, not just a US one. I suspect that part of that is driven by ever increasing inequality. Part of that is because of compounding – once you have some capital and invest it in something with a positive expected return you can’t help but watch your pile grow. The other component though is that the ones with the marbles make the rules so the table gets tilted and tilted more and more. I suspect that the combination of this is causing things to get a boiling point globally. And an uneducated and uniformed population only speeds up that process. Watching the pot boil over is not going to be fun.
The AI bubble might be popping.
https://www.ft.com/content/e670a4ea-05ad-4419-b72a-7727e8a6d471
It would be interesting if cheap Chinese AIs were the cause.
The AI Hype left out that these algorithms have been around since the 1970s.
What has changed is Moore’s Law, Big Data Architectures (universal 64-bit and cheap disk space) and an Internet full of training data.
AI has not demonstrated a sustainable business model, and companies are paying out the WAZOO for the data centres
Trump’s plan is actually Putin’s plan. Huh.
https://www.newsweek.com/donald-trumps-100-day-ukraine-peace-plan-leaked-report-2021215
Government under the control of a nation’s worst or least-qualified citizens.
Kakistocracy is a term that describes a government run by the worst people. It comes from the Greek words kakistos (worst) and kratos (rule).
And never was a country more deserving.
I think Kaka also means shit.
Yes, from ancient Greek kakos, bad, literally shitty.
Seems to have several similarities to the broken Minsk agreements from quite some time ago, but broken by whom you would perhaps ask?
Nobody is too focused on being right or wrong in the end it seems. It reminds me of a truce, Korea war style.
Warfare is costly in all aspects like non productive industrial output to human lives and wellbeing.
even gas price dropped 10% amid winter storm from US and Deepseek
Although I didn’t predict this AI, it isn’t too surprising. GoogleMind shocked the go world with AlphaGo. Kejie, the best go player in China, cried when AI beat him. His mind was blown. But Chinese programmers recovered quickly and came out with several of their own powerful go playing AIs.
But the shocking thing is the DeepSeek claims they only spent $5.6 million building their model. American tech giants are claiming they need tens of billions. A lot of that money would have gone into energy.
In other words, DeepSeek is claiming a 99.99% efficiency improvement. That’s newsworthy.
That’s largely because the Chinese are using the infrastructure developed with those billions of dollars, and are pirating the data with which deepseek operates. Nothing new here.
No, the big cost is the chips and the energy to run the chips. That’s why NVidia’s stock got hammered today.
DeepSeek will have used their own farm or paid for someone else to run their training. There’s nothing to steal here.
On the energy side, one possibility is that they were piggybacking on solar Bitcoin miners. On the one hand the Musk side of the Trump presidency is pushing Bitcoin, but on the other hand Beijing is cracking down. Bitcoin miners have built huge solar farms in Chinese Central Asia. So if they have excess capacity that could explain the energy side.
Hard times for Bitcoin miners could also explain where they got the chips. GPUs are use for coin mining and AI, as well as for their original use, fancy graphics.
The timing seems odd though.
About the idea that the Chinese steal everything from the West, I worked for Taiwanese companies in the 1990s, when they were taking the PC mainboard market away from American manufacturers. This is what I noticed at the time: It is often said that cheap labor is on reason why Asian companies excel. There is some truth in that. But it isn’t just sweatshop workers. Cheap engineers are the reason it is so hard to compete with emerging markets on technology. They aren’t better or worse or more or less prone to stealing ideas than expensive engineers, but there are a lot more of them. Put ten decently trained engineers on your mainboard project full time and chances are you’ll outcompete a company that can only afford two or three.
Alimbiquated
I appreciate the comments. Although not in the position to add to much, I would say it would be wrong to underestimate the intelligent people that must be behind both making the physical chips and also the software. Extrapolating expertise and knowledge. AI works very well in some applications though – just talking from personal experience.
Apparently AIs are often used in thesises and such now, but also in research grant applications, perhaps one would need an AI to examine those to find them?
Preferably a different one than the one writing it…
(But on the other hand, if it´s a good idea but you´re a poor writer, it might be a good thing to use?)
Interesting times for sure, have some NVIDIA graphics boards but no position, luckily.
There’s really nothing novel or good about LLMs as they are. The Chinese ones being more efficient just means we can kill the private equity and venture capital firms dumping hundreds of billions into this stupid bubble to get rid of workers via shitty chatbots.
NVIDIA is up today, but for how long? Literally the only stocks doing well are the Big Tech ones that are in on this crazy fad because they literally have no other growth potential revenue streams on the horizon.
The ugly face of reality. Ugly if you’re an elephant, dolphin or human.
COAL CONTINUES TO DOMINATE CHINA’S ENERGY LANDSCAPE
• China’s thermal power generation, primarily fueled by coal, reached a record high in 2024 despite a surge in renewable energy installations.
• Coal consumption continues to grow in China’s electricity sector, driven by increasing power demand and the need for a reliable baseload power source.
• China’s coal imports and domestic production are expected to rise further in 2025, solidifying coal’s role as the backbone of the country’s energy system.
“Coal consumption in the electricity sector continues to grow and so are China’s production and imports. The persistent growth in Chinese coal demand, including for power generation, goes to show that coal remains the baseload of China’s power system to back up the surge in renewables and will stay such for years to come as power demand jumps with the increasing electrification of homes and transport.
The Chinese growth in coal consumption defies previous views that coal use is peaking in the world’s biggest consumer of the fossil fuel.”
https://oilprice.com/Energy/Coal/Coal-Continues-to-Dominate-Chinas-Energy-Landscape.html
“Accused of Sexual Assault, Drunkenness, and Financial Mismanagement, New Defense Head Is Confirmed”
Trump people are put in charge
Not one to stay glued to the stock market ticker, but NVidia’s market valuation fell by about $800,000,000,000 yesterday.
All the way back down to where they were 4 months ago.
Yeah, the market is very frothy. NVidia lost $1.2 trillion at one point, but bounced back.
Deepseek claims it was using nerfed NVIDIA chips they bought for coin mining and stock market trading. Nerfed because the US government doesn’t allow NVidia to export the highest end chips to China.
This reminds me of the 1970s when the American government kept gas cheap but Japan taxed it heavily. So Japanese companies built fuel efficient cars and American companies built terrible inefficient cars (The 70s really were the low point of American cars.) Then there was a oil price spike and the Japanese hammered the American car (and motorcycle) industry.
Unexpected consequences.
“Let us not talk falsely now
The hour is getting late”
—Bob Dylan
With respect to Trump’s taking virtually all departments to the woodshed: On the one hand all organizations – when not pruned on a regular basis the tend to accumulate excess fat – but on the other hand his clearly vindictive and red meat baiting way of going about things is not about increasing efficiency and effectiveness but about revenge and pacifying some of his base. So it is possible that at the end government may be more rational ( when closing ones eyes to blatant grift) and in better shape.
Trying to be optimistic here so please have mercy…..
Weekendpeak,
It may in the end be good for the environment because the end result may be a Worldwide Depression, the $25/b prediction of HHH may soon come to pass, but not for the specific reasons he claimed, just from an unchecked lunatic in the White House making very bad decisions leading to chaos and a crash in the World Economy.
This recent US election may disprove the old adage that Democracy is the worst form of government, except for all the others.
I’m actually impressed Trump is beating even my expectations in dismantling America. I know him and Musk talked about crashing the economy. I just thought it was going to be in months, not days at this rate.
It’s perversely refreshing to see direct action so quickly form this way. Like the executive has remembered they can do stuff. Unfortunately, that stuff is “move fast and break things” at a national level.
The rightwards lurch seems to be a global one, not just a US one. I suspect that part of that is driven by ever increasing inequality. Part of that is because of compounding – once you have some capital and invest it in something with a positive expected return you can’t help but watch your pile grow. The other component though is that the ones with the marbles make the rules so the table gets tilted and tilted more and more. I suspect that the combination of this is causing things to get a boiling point globally. And an uneducated and uniformed population only speeds up that process. Watching the pot boil over is not going to be fun.