Is AI Heading for a Crash?

The "Magnificant 7" Stocks are all Off of their All Time Highs in Early July. Is this the Beginning of the Unwind?

So I’ve spent around six hours this weekend trying to log in to my Chime Bank account. I’ve talked to their AI bot about this issue so many times I have memorized the numerical sequence that I need to enter to talk to a human customer service representative, that being 2 to input my information by hand, 6 for issues with my mobile account, and 9 to talk directly into the Chimebot and tell it “I can’t log in to my mobile account.” Now I have to wait at least 4 or 5 minutes to go through this process, as the Chimebot informs me if I press a number too soon that “I’m sorry but that is an invalid number.” So I have to listen to to the Chimebot inform me of how to check my account balance, how to change my address, update my PIN, update my email address, report my card lost or stolen and other things every single time. And of course all of this information is easy to do on the mobile app, Chimebot informs me helpfully during every pause. Which I can’t access. Hence me calling them.

Sometimes the Chimebot misunderstands my issue, in which case it usually hangs up on me. Once it thought I said something about mobile checking instead of mobile app so it kept repeating the same useless message about what to do about it. “If you would like me to stop talking, please press the # key.” It finally said. I proceeded to press the #$%&##)!*#%!! until it brought me back to the main menu that time instead of hanging up on me. I was amazed.

My issue with Chime in this case is this seemingly easy to fix problem. My husband’s phone in which I used to use to access mobile banking has blinked out and I have a new one. The Chime app says it needs to check my ID and have me take a selfie to verify who I am. My phone has a not very good camera and takes blurry pictures of my driver’s license. So no online banking for me.

Now I have my same ID and passport. I have my same address, my same debit card and bank account number, my same name, same SS number, same password, same email, same phone number, same voice, same person, same everything else as I had before. My new Thailand mobile phone simply takes blurry pictures of my ID card which are unacceptable according to Chimebot. This seems like an easy fix to a very stupid programmer created barrier to my account, wouldn’t you think? I mean it’s not like I’m changing the password and the receiving bank information and cashing out the account here.

It seems Chimebank representatives are beholden to the AI Gods, as it were. There was some backhand mentioning of buying a better phone which takes acceptable pictures, though it was always worded kindly. There were definitely questions regarding why I didn’t have access to any other better phone. I explained that I work on my laptop and use my mobile phone for basically nothing outside of making and receiving calls. There is no bank access on my laptop as it always tells me “Oops! We’ve encountered an error! Please login to your mobile Chime account.”

Eventually someone at Chime Bank was able to send a link to my laptop to the identification verfication process which opened from my laptop, and after a few unsuccessful attempts they were able to verify that I was really me. But my mobile app still didn’t work with the whoops we’ve encountered an error message. Another customer service rep said to wait an hour (I did that a few times). Another one said to uninstall and reinstall the Chime App. I did and it brought me back to the same “we need to verify your identity please have your ID card ready” screen that started the entire process. I don’t need that to vote in the USA, right? Nevermind that I am actually an American citizen and am not dead at last check.

I’d like to assume the Chime human reps are as frustrated as I am by their utter impotence. At least they are getting paid, though it is probably extremely subpar wages in God only knows what country. An entire army of out of sight human laborers support these AI systems when they encounter a problem. Have I been compensated for my six hours of wasted time? Of course not. I suspect the entire point is to diminish the human experience on all sides and to normalize outright adminstrative theft. Thankfully my account currently has so little in it that I suspect the would be thieves would give me money if they saw it.

Chime customer service does not have good reviews, earning an average of 2.1 stars out of 5. The most common problem overwhelmingly was that money stolen was not refunded and many bad reviews have been written in the past few months. I went through that myself. I filed a dispute on a dispute which tooks months to resolve into absolutely nothing back. One of the more common issues listed is problems logging into the mobile account. So it’s as safe and effective as everything else is lately:

As this post from idi.ca summarizes on How AI is a Sign of Collapse:

“To hear it from the beast's mouth, this is Jim Covello of Goldman Sachs:

My main concern is that the substantial cost to develop and run AI technology means that AI applications must solve extremely complex and important problems for enterprises to earn an appropriate return on investment (ROI). We estimate that the AI infrastructure buildout will cost over $1tn in the next several years alone, which includes spending on data centers, utilities, and applications. So, the crucial question is: What $1tn problem will AI solve? Replacing low-wage jobs with tremendously costly technology is basically the polar opposite of the prior technology transitions I’ve witnessed.

“Seriously, what big problems does AI solve? Producing massive amounts of self-confident bullshit? We already have Americans. Producing kill lists? We already have 'Israelis'. Drawing pictures? We've been doing this since the cave man days. 'Optimizing', finding 'efficiencies', these are all literally marginal gains, achieved with massive complexity (and piss-poor reliability), precisely what Tainter described in his thesis. Generative AI burns a rainforest to produce a spark. As Joe said:”

More complex societies are more costly to maintain than simpler ones, requiring greater support levels per capita. As societies increase in complexity, more networks are created among individuals, more hierarchical controls are created to regulate these networks, more information is processed, there is more centralization of information flow, and there is an increasing need to support specialists not directly involved in resource production. All of this complexity is dependent upon energy flow at a scale vastly greater than that characterizing small groups of self-sufficient foragers or agriculturalists. The result is that as a society evolves toward greater complexity, the support costs levied on each individual will also rise, so that the population as a whole must allocate increasing portions of its energy budget to maintaining organizational institutions. This is an immutable fact of societal evolution, and is not mitigated by the type of energy source.

As Covello said in the Goldman Sachs report, “AI bulls seem to just trust that use cases will proliferate as the technology evolves. But eighteen months after the introduction of generative AI to the world, not one truly transformative—let alone cost-effective—application has been found.” Note that Goldman Sachs makes more money as this AI boom goes on…

So back to the so called “Magnificent Seven” stocks, which at one point were called FAANG back when it was five and the names were different. These are the technology stocks driving most market gains as shown here: Meta (formerly Facebook), Amazon, Apple, Nvidia, Alphabet (formerly Google), Microsoft and Tesla:

Most of these stocks reached all time highs in early July, with three earning that high water mark on my father’s birthday July 5. Most got hammered last week especially Tesla which lost $90 billion in market capitalization on lackluster earnings. A few are scheduled to report this week. Buy the dip right?

Here’s my reasons for passing. This does not constitute investment advice and I am well aware the market can remain irrational long after someone can stay liquid:

1. Emerging markets is an old tapped out story for them. Does anyone not know about Facebook or Google or the Internet at this point? It’s become diminishing returns on all fronts: less convenient, less easy to access, and more prone to disruptions from supply chain shocks, hackers, electric power disruptions, Internet disruptions, inflation making it prohibitively expensive and, I could go on and on here. I haven’t even touched on the massive time wasted to restore an account which somehow became in less than good standing. It’s not trustworthy.

2. Executives are leaving their C suite positions at the fastest pace in 20 years and insiders are dumping their shares at the highest rate since the financial crisis:

   3. Earnings so far have been failing to dazzle. On the electric vehicle front Ford reported it is losing close to $50,000 for every EV sold while Tesla shares plummeted on promises of robotaxis in the future. Are electric vehicles solving a problem? Do they have longer range than traditional ICE vehicles? Are they cheaper than traditional ICE vehicles? Are they more convenient?

   Based on my experience with autobot customer service, I’m not trusting my life to a car which says “We’re experiencing some technical difficulties. Please login to our Chimecar app” which does not even let me open the doors to physically get out while I am, I don’t know, underwater, or the car is on fire.

4. The entire reliable energy generation paradigm on which these stocks are based is flawed. Something is going to give here as a lot of lies have been told regarding renewable generation as well.

5. Three of these stocks hit their All Time Highs on my Dad’s birthday. Call this an intangible.

   A long time ago I would have expected real investors in the market to be considering these things, at which point their short positions in say Microsoft ahead of earnings this week (an obvious no brainer with the Crowdstrike outage) would get wiped out by bigger players. Anymore I am not so sure. It seems like it’s algorithms fighting algorithms with no real humans in the room. Are they intelligent? I don’t think so. Then again we aren’t so smart ourselves to give them the lead like we have.

   What do you think on this? Are tech stocks and others headed for a fall?

   Psst: Despite these Chime hiccups all donations and support is greatly appreciated and has come in to me thus far. Every bit counts. :-)

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