{"id":295330,"date":"2026-02-21T15:09:08","date_gmt":"2026-02-21T15:09:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/295330\/"},"modified":"2026-02-21T15:09:08","modified_gmt":"2026-02-21T15:09:08","slug":"steve-hanke-warns-ai-is-overhyped-and-might-be-dangerous","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/295330\/","title":{"rendered":"Steve Hanke Warns AI Is ‘Overhyped’ and Might Be ‘Dangerous’"},"content":{"rendered":"

Steve Hanke<\/a> says there’s excessive buzz around AI \u2014 and it could end badly.<\/p>\n

The veteran trader and economist told Business Insider by email that he agrees with Yann LeCun<\/a>, Meta’s former chief AI scientist and a pioneer in the field, who’s warned that large language models (LLMs) such as ChatGPT<\/a> just aren’t that revolutionary.<\/p>\n

Hanke quoted a speech by LeCun in the spring of 2024, where he said: “We’re easily fooled into thinking they are intelligent because of their fluency with language, but really, their understanding of reality is very superficial.”<\/p>\n

LeCun added that the chatbots have their uses but “on the path towards human-level intelligence, an LLM is basically an off-ramp, a distraction, a dead end<\/a>.”<\/p>\n

Hanke, a professor of applied economics at Johns Hopkins University, said he’s “on LeCun’s side of the court” and considers AI to be “overhyped and potentially dangerous.”<\/p>\n

He told Business Insider last October that whether the market’s exuberance turned out to be rational or irrational would “largely depend on whether the AI firms’ spectacular revenue forecasts hold water.”<\/p>\n

“It might be wise to buckle your seat belt<\/a>,” he added.<\/p>\n

Hanke was the president of Toronto Trust Argentina when it was the world’s best-performing market mutual fund in 1995. He also served as an economic advisor to President Ronald Reagan.<\/p>\n

Believers and skeptics<\/p>\n

Despite some recent jitters, the AI boom seems to be going strong with OpenAI reportedly close to raising north of $100 billion<\/a> at a potential $850 billion valuation. ChatGPT’s maker crossed $20 billion in annualized revenue last year.<\/p>\n

The so-called “hyperscalers” racing to build the infrastructure to power the AI boom have forecasted some truly mind-boggling outlays<\/a>.<\/p>\n

Meta, Amazon, and Alphabet recently projected that their capital expenditures for 2026 could reach a combined $520 billion, and Microsoft is also on track to invest more than $100 billion this calendar year.<\/p>\n

LeCun recently departed Meta after working at Facebook and Instagram’s parent company for more than a decade. He left to found Paris-based AMI Labs and develop open-source AI that could truly comprehend and model the physical world<\/a>, not just language.<\/p>\n

Hanke isn’t alone in sounding the alarm on the AI boom. Michael Burry of “The Big Short” fame has warned tech giants are overinvesting<\/a> in microchips that could quickly become obsolete, and could see disappointing returns.<\/p>\n

Jeremy Grantham, a bubble guru and GMO’s long-term investment strategist, has cautioned<\/a> that previous transformative technologies, such as railroads and the internet, were marked by initial bubbles that inevitably popped, and he expects the same to happen with AI.<\/p>\n

However, AI champions from Elon Musk<\/a> to Sam Altman<\/a> have predicted the tech will supercharge productivity and generate huge profits, so the run-up in valuations is more than justified.<\/p>\n","protected":false},"excerpt":{"rendered":"Steve Hanke says there’s excessive buzz around AI \u2014 and it could end badly. The veteran trader and…\n","protected":false},"author":2,"featured_media":295331,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[365,363,364,111,139,69,145],"class_list":{"0":"post-295330","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-new-zealand","12":"tag-newzealand","13":"tag-nz","14":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/295330","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=295330"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/295330\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/295331"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=295330"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=295330"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=295330"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}