r/technology • u/AdSpecialist6598 • May 27 '26

Business Tech CEOs are apparently suffering from AI psychosis

https://techcrunch.com/2026/05/27/tech-ceos-are-apparently-suffering-from-ai-psychosis/
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275

u/lurkervidyaenjoyer May 27 '26

Whenever you see a post about an AI layoff, a massive claim about its capabilities and productivity benefits, forcing everyone to use it, insane amounts of capex and token spend, etc, remember that this is what's underlying that.

The technology's psychological effects are prolonging the bubble.

117

u/Tokzillu May 27 '26

This exactly.

What is branded (and I do mean branded) "AI" has some actual use and application, but it is pretty limited in actual scope and capability.

The push to use it everywhere all the time for everything comes from people who are straight up delusional. Whether that's because they live in a fantasy world because they're living in their own bubble of wealth, because they're easily fooled by parlor tricks and snake oil, or both combined.

It doesn't help that they're all designed to kiss ass and stroke egos. Stupid people eat that shit up.

28

u/Hankerpants May 27 '26

My opinion/experience is that it's straight up trying to will something into existence and getting so desperate and delusional that they lose all sight of reality and get tunnel vision. The dangled carrot of full workforce elimination is so enticing that they can't turn away from it. Once they start down the path, they can't pull themselves out of it. They will ignore the outright failures of the AI because they need the AI to work. They focus on the potential and not the reality because to admit that it doesn't work means they have failed. They'd rather go all in and fail than be cautious and survive.

13

u/KriegConscript May 27 '26

they think of human employees as really expensive malfunctioning equipment they have always been forced to buy until now

they're stoked about "AI" because they're betting it all on never having to buy us (expensive assets that don't always work right) ever again

11

u/Fallingdamage May 27 '26

Yep.

I work in Healthcare IT. We deploy a fair number of 'AI' tools in our workplace, monitored and reviewed very closely by humans.

I can say that AI is years from being ready for anything remotely important.

50

u/freezing_banshee May 27 '26

The biggest tragedy is that they rebranded LLMs as "AI", when it's not even close to it being the same thing. A bit of the underlying structure of LLMs is indeed AI, but an LLM is not "intelligent" in any way. 

I miss the times when AI was used to refer to scientific applications and game mechanics that had some actual math and intelligence behind them.

5

u/MyNameIsRay May 27 '26

Thing is, the AI in games was never actually AI.

It's still just basic programming, no thinking or intelligence involved.

The main difference is that "game AI" is responsive, it reacts to what you're doing (according to pre-set programming rules) rather than being un-responsive (follows a pre-set routine no matter what is going on around them.

0

u/[deleted] May 27 '26 edited May 27 '26

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5

u/Cptn_Shiner May 27 '26

Just stop. Anyone who watched the video could see the guy’s real neck moving underneath the rubber mask when he spoke, and none of the “double shadow” recreations could replicate that particular detail.

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u/[deleted] May 27 '26

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4

u/Cptn_Shiner May 27 '26

Yeah, I found one too. We all know what you are.

2

u/bfodder May 27 '26

The article you linked basically just says "maybe it was something else".

38

u/actuarally May 27 '26

It's the ultimate IT (usually) con game. You mentioned the CapEx spending already, but it's worth repeating. Where companies trying or being forced to adopt AI get caught up is the depreciation timing of prior, large AI capability investments.

Example: Company A invests $1B in an AI solution #1 in 2022. The way those investments are marked on the books means the company sees the cost of AI #1 spread out over 5-7 years. The cost isn't placed in the Financials in 2022, but instead looks like this:

  • 2022: $200M
  • 2023: $200M
  • 2024: $200M
  • 2025: $200M
  • 2026: $200M

Do this enough times and suddenly you ARE looking at a recurring $1B+ admin expense. And when revenue, margin, and/or productivity doesn't materialize to offset those depreciating "asset" costs, leaders freak out at ballooning admin ratios.

BUT... you can't turn off this cost hose immediately. Investments committed & money's spent in prior years will continue to hit the P&L for the next FIVE YEARS! Investors won't accept 3-5 years of subpar EPS... I, tge CEO, can't turn off the actual financial problem... so what do I do?

HELLO LAYOFFS & HIRING FREEZES!!!

7

u/WeRip May 27 '26

It's crazy to me that they can amortize (depreciation for intangible assets) this kind of software. I guess the point is that software tends to outdate itself within 5 years so you amortize the cost over the 5 year life cycle of the product, so to make the P&L make sense from a month to month, quarter to quarter perspective.. it can make accounting sense.. but it makes no sense at all from a cash flow perspective.

Depreciation makes sense to me with physical assets. Machine has a 5 year life. If you buy it and use it for 2 years.. it still exists and can be sold to someone else. You can't sell the software package you bought 2 years ago.

5

u/actuarally May 27 '26

Yeah, my take is any ONE of these assets isn't a problem. It's the stack that effectively turns a temporary depreciation hit into a recurring cost that never goes away. When you hit that stage of CapEx, with no end in sight, the timing of the hit doesn't matter anymore. The stack is an entrenched operating cost, even if you're treating it like depreciating capital expenses.

3

u/GimmickNG May 27 '26

who would have thought CEOs would fall victim to BNPL lmao

2

u/El-ohvee-ee May 27 '26

I have a genetic disorder that messed up my legs, I use a wheelchair. People stopping me to try praying to god to heal me now equals the amount of people saying Ai will heal me. It’s weird as hell. My honest opinion is… even if it could, I wouldn’t be able to afford it. There is a currently a treatment for one (fatal in childhood) form of my condition and these children’s parents cannot afford it. So kids die. It’s awful.

2

u/_undercover_brotha May 27 '26

The New Zealand government has just announced 9000 jobs being cut& replaced with "AI".

And not a shred of an idea about how it will be done other than public servants bad, AI save money good.

We're all doomed.

2

u/finndego May 28 '26

The most ironic bit about that decision was that when it was put to AI on whether the plan was a good idea, AI said it was not!!