Comments
By ZeroCool2u 2026-02-1818:34 Gift link for folks: https://www.bloomberg.com/news/features/2026-02-18/us-econom...
By FrustratedMonky 2026-02-1817:536 reply What will the economy consist of when there are no more paychecks? Thus nobody buying anything.
We'll gain so much efficiency that the economy will evaporate.
The markets can't survive on capital alone.
LOL. Like a diet focusing on a single macro. When all that is left is capital, then that is an unhealthy diet.
> What will the economy consist of when there are no more paychecks? Thus nobody buying anything.
It could be possible to have high GDP with low paychecks… it basically means the entire economy mostly consists of the wealthy few buying and selling things to each other. It is easy to see how that could happen if more things become automated.
You could imagine a world where there are only two people who own anything, and the entire economic productivity is generated by robots owned by those two people creating things and selling them to the other person, who uses those things for their robots to work with. You could produce tons and tons of things with no workers, and the GDP would keep growing.
Of course, the high GDP doesn’t mean everyone is fed and sheltered. Having a functioning and growing economic market is required for capitalism to serve its purpose of providing for the citizens, but it isn’t the ONLY requirement. If the form capitalism takes as we move into the future is one that stops providing for enough of its citizens, it won’t be able to sustain itself. I think there are things we can do to shift our capitalism to do a better job of providing for everyone, but there are a lot of forces fighting against that.
By Terr_ 2026-02-1818:50 > It could be possible to have high GDP with low paychecks… it basically means the entire economy mostly consists of the wealthy few buying and selling things to each other.
A similar thing happens when people talk about "total debt" in an economy. I like to bring up the scenario of 3 people trading a shiny rock around in a circle. Each time seller doubles the price and agrees to defer payment.
In this way, three kids can spend recess at school running the nation's average household debt to near-infinity! There are a few flavors of GDP calculation, but I expect it could yield some similarly odd results.
In both cases, the map is not the territory, and the metric is indirect/imperfect.
By water-data-dude 2026-02-233:59 That's the setting for The Electric Church, by Jeff Somers. There's a very small capital class who own all the automated manufacturing plants, etc., and they live in obscene grandeur. Then there's the rest of the world which is basically a slum, brutally oppressed by the police force to keep them from rising up. The population gets everything they need to survive, but it's all fairly shitty - the technology for a post scarcity society exists in the setting, it's just hoarded by the most obscenely wealthy.
Pretty decent sci-fi, just pretend he didn't write any sequels tho.
Capitalism works due to the "free market" which maps a large number of producers to a large number of consumers in an efficient way. When the market ceases to be sufficiently free, capitalism starts to falter. It may be regulation, it may be monopoly, it may be monopsony, it may be dysfunction of the judiciary system that fails to protect property rights, etc.
A system of only two parties trading the entire economic output of a country would be utterly un-capitalist, more like two kings trading in products of their kingdoms. No doubt that any social institutes would have been subjugated by these two parties.
By Terr_ 2026-02-199:09 > an efficient way. When the market ceases to be sufficiently free
I want to highlight that the freedom of the efficient market is not the same as the freedom of participants, and that in certain specific ways they are inherently opposed.
Contrast these two kinds of promotion:
1. "Our X system is the most efficient and our best chance for abundance, we proved it with math! ... Because "correct" prices are discovered through public prices where all transactions are open market transactions with public prices. I
2. "Our X system is the free-est because nobody's telling you what to do with your stuff! Economic liberty! ... Because two consenting parties can make all sort of private deals with secret or preferential prices and and non-disclosure agreements.
I feel there are certain blocs--sometimes certain individuals--that act as if both are equally and simultaneously true, despite the inherent contradiction.
On one hand richest top 1% own 30% of the total US wealth (and services/goods for the rich is a booming sector) but on other hand their wealth depends on a fully functioning economy. If 99% of population will be excluded form the economy top 1% will not be able to keep their current wealth either (even if they still be comparatively better off).
I worry that some fraction of those 1%ers have the hope that this is where AI will lead to in the end: You don't need the 99% if they can actually be replaced with robots.
Or, if that doesn't work (because the robots are too dumb), you can at least split off the economy into a "poor" and a "rich" part that are mostly disconnected from each other.
By FrustratedMonky 2026-02-1914:041 reply I wonder if this is what will happen. We'll have a two tier world.
What if the 99% of 'poor', create their own economy, own currency, start opening shops, small factories, etc...
Could we have an entire society without the rich? Reboot an an actual economy based on real goods?
By lucyjojo 2026-02-222:41 the rich has the monopoly on violence
I don't see how the rich don't understand this. Guess they just think it won't happen to them and they'll be smart enough to cash out of America and go elsewhere before everyone else looses.
They think the robots will soon be good enough to replace the human workers.
Including the security roles that ensure the unemployed workers don't forcefully express their dismay at being redundant.
By FrustratedMonky 2026-02-1819:441 reply It seems like we are long way from robots building robots. So they need humans. Maybe the last people with jobs will be building that first generation of robots that still need humans.
By ceejayoz 2026-02-1821:46 > It seems like we are long way from robots building robots.
I think it's very possible some of these folks have convinced themselves otherwise, and have largely eliminated the folks who'd say "you fucking idiot, no" from their lives over the decades.
By giraffe_lady 2026-02-1818:19 Would you rather be a billionaire in a world of millionaires, or a millionaire in a world of penniless peasants? What we're seeing now is the billionaires' answer to this question.
By butterbomb 2026-02-1819:40 They know. That’s why they’re investing in things like land and building castles. They know the future they’ve designed. They’re already laying the foundation needed to win total power.
By darth_avocado 2026-02-1818:171 reply > What will the economy consist of when there are no more paychecks?
I joked with my manager when we were having a conversation about everyone being asked to use more AI, as an obvious precursor to keeping fewer employees to do the same amount of work: the end state of AI will be an AI manager having career conversations with the AI employee, discussing raises and bonuses.
The ironic part really is that the average middle management job is probably among the more simple jobs you can automate away with AI at scale. Tell it your metrics, your targets, and other relevant info, and it can feed directions down to employees at scale.
By Henchman21 2026-02-1819:092 reply I don't buy this at all. There's significantly more to management than tracking and hitting metrics. You have to actually do the hard part of interacting with people and understanding their needs and so on within the context of work.
I'm sorry, but vomiting up another bulleted list is NOT management. Its giving orders and then culling the % that don't comply. Wildly different things.
By darth_avocado 2026-02-1820:101 reply > You have to actually do the hard part of interacting with people and understanding their needs and so on within the context of work.
Which is why it’s surprising that management is salivating at the idea of replacing employees and expecting 1 employee to do the work of 10 with the help of AI agents. If the value you bring is to manage people, you shouldn’t be happy at the idea of fewer people having jobs.
By JambalayaJimbo 2026-02-190:341 reply Management is salivating because their jobs are hard to automate, so they stand to benefit from not having to pay employees as much.
By darth_avocado 2026-02-194:56 Again, what exactly are their jobs? You can’t automate them but you won’t need them either. If an org shrinks from 1000 engineers to 500 or worse, do you really keep those managers/directors/VPs around?
By cudgy 2026-02-1820:48 > You have to actually do the hard part of interacting with people and understanding their needs and so on within the context of work.
How many human managers actually do that, though? How many websites performed satisfactorily before AI arrived? How well has technology matched what consumers really need or want? Maybe, as a society we have underperformed and nescient AI performs well enough (or even better) in comparison.
By butterbomb 2026-02-1817:581 reply > What will the economy consist of when there are no more paychecks?
I’m suspecting something like Soylent Green, but perhaps with more proactive action taken to free up resources by removal of masses who are no longer producing enough value to justify their expenses.
Following up, I believe eventually it will all be replaced by something much more resembling feudal power. Where bound servants provide service labor in exchange for protection/survival. Something like fuedalism but without the agricultural focus of manorialism.
By Henchman21 2026-02-1819:11 > but perhaps with more proactive action taken to free up resources by removal of masses who are no longer producing enough value to justify their expenses.
How bout we remove the heads of the wealthy and hoist them on petards outside their former dwellings instead? We don't need to justify the removal of these cancerous lumps of flesh we call "the elite". We don't need them. THEY NEED US.
The problem is that it seems like wealthy people (capital owners) might be able to sustain the economy between themselves, which is basically what we're seeing.
Looks like this is their plan but it's too early to say if it's a good plan.
I think it's a good plan. You don't really need pleb laborers and consumer practices when you can just have automated laborers and patrician goods.
By georgemcbay 2026-02-1818:49 Whether or not it is a good plan depends upon how much faith they have in their doomsday bunkers and robot armies to protect them from the masses during the transition.
"Every society is three meals away from chaos"
By burnt-resistor 2026-02-192:42 Power law distribution that becomes even more exaggerated. Billions and billions of poor people in borderline favelas spending every dime on food, housing, security, and distractions from misery. The Middle Ages all over again but with more technology and a few individuals relatively richer than Mansa Musa. When the food/water runs out on one or more continents from a precarious supply chain, expect massive, desperate migrations that haven't been seen in history perhaps. Perhaps rhyming with the Late Bronze Age collapse.
Job sector growth (after revisions down) has been almost entirely within the healthcare industry which is quite unsustainable. We can't all get rich being a middle man between the doctor and our neighbors. Outside of that sector we're seeing economy-wide shrinkage and stagnant wage growth with a decrease in real wages relative to inflation.
This is a recession - it will be a full-on depression if we get a doveish Fed chair... it might be one anyways, we'll need extremely adroit action to recover into a healthy economic state.
But hey, DOW go up and that's all we care about, right?
> We can't all get rich being a middle man between the doctor and our neighbors
I'm not familiar with the healthcare sector. Is this where the job growth is?
The country is getting older and I expect there would be a lot of demand for non-AI-replaceable nurses and elder care. Many of those workers have also been deported or scared out of the country.
By jmye 2026-02-195:13 > I'm not familiar with the healthcare sector. Is this where the job growth is?
Real world, less so; HN-focused areas, absolutely. Nearly every mediocre, tech-focused healthcare start up is just a money siphon, no matter how many times their founders talk about “disruption”.
In actual healthcare, there are massive nursing shortages, and lots of need for people doing actual, hard, brick-and-mortar work.
By toomuchtodo 2026-02-1818:031 reply https://old.reddit.com/r/dataisbeautiful/comments/1r21tdv/oc...
https://www.wsj.com/economy/jobs/january-jobs-report-unemplo... | https://archive.today/9gdEO
Healthcare job increases should not be unexpected as the country ages, deaths outnumber births in 21 states (as of this comment), the demand for care will only grow over time.
https://usafacts.org/articles/america-is-getting-older-which...
> As of 2024, 18% (61.2 million) of Americans are 65 or older, according to Census Bureau data. The national population over the age of 65 has more than doubled since 1980, with three-quarters of that growth occurring in the 21st century. The 65 and older group grew by more than 26.2 million people, a 74.6% increase, during that time.
https://www.prb.org/resources/fact-sheet-aging-in-the-united...
> The number of Americans ages 65 and older is projected to increase from 58 million in 2022 to 82 million by 2050 (a 42% increase), and the 65-and-older age group’s share of the total population is projected to rise from 17% to 23%. The U.S population is older today than it has ever been. Between 1980 and 2022, the median age of the population increased from 30.0 to 38.9, but one-third (17) of states in the country had a median age above 40 in 2022, with Maine (44.8) and New Hampshire (43.3) at the top of the list.
It is very unlikely the work done by CNAs, RNs, physical therapists, and others providing this population care can or will be automated.
By simonsarris 2026-02-1823:32 That top graph has been shared a lot but its a somewhat disingenuous display of data. It's true that lots of growth has been healthcare in the last 2 years, but that doesn't mean zero growth elsewhere, you can see eg construction growth on the chart, which is reflected in the fact that construction is seeing all-time-high employment right now:
https://fred.stlouisfed.org/series/CES2023700001
And if you look at something that's "flat" like transportation, its still essentially at all time highs right now, its just now declining slightly, but its on the heels of major growth: https://fred.stlouisfed.org/series/CES4300000001
Now if you look at one that's negative on the graph, like retail trade, and zoom out:
https://fred.stlouisfed.org/series/USTRADE
It's still essentially at all time highs!
Serious contractions in these things would be much more worrisome, but this data is basically fine. Some losses may just be temporal corrections from all time highs, like what happened to software jobs at the end of ZIRP (though Software now has separate problems to solve wrt job market).
There does not appear to be a recession.
By Forgeties79 2026-02-1819:29 I think it’s fair to say we are in a strange economic environment and no one can clearly say what the situation is.
By biophysboy 2026-02-1818:20 To be fair, the healthcare employment flows are small (1.6M) compared to the total employment stock (160M+ people). And you would expect the healthcare labor supply to increase to match the bulge created by the baby boom. I don't think this means we will all be a healthcare middle man though; it assumes this large flow is permanent, and overstates the fraction of the labor stock.
By thalpr 2026-02-1818:13 The Trump clan literally does not care. The most pressing issues are to further legalize crypto so that the whales (including Trump's World Liberty Fund) have an exit. So there is a family/industry crypto conference at Mar a Lago while the economy is crashing:
https://www.reuters.com/world/us/goldman-nasdaq-ceos-headlin...
I mean, even ignoring the recent GenAI narrative, vast portions of the economy have already been significantly automated for decades.
Additive Manufacturing, industrial robotics, the Internet, and the proliferation of computers had already made large portions of manufacturing and low skill white collar jobs redundant by the mid-2010s.
Furthermore, the brutal reality is most businesses can generate revenue growth just by concentrating on the 90th percentile and above of households [0], (edit: or at best the 70th percentile of households of income [1]).
For example, despite all the love Costco gets on HN - the reality is it only targets customers within the top 50% of households by income [2]. You may delude yourself into thinking that you are a thrifty underdog when you shop at Costco, but the reality is most Americans cannot and will never be able to afford Costco, and Costco doesn't want or need their business.
A K-Shape Economy is actually the historical norm.
[0] - https://ourworldindata.org/grapher/income-share-of-the-top-1...
[1] - https://dqydj.com/household-income-percentile-calculator/
[2] - https://www.businessinsider.com/how-costco-sams-club-shopper...
This is my suspicion. I imagine, if you don't care about the majority of the population, you might as well reduce the economy to circular transactions between corporations and between 1%ers and the businesses catering to them.
Circular Transactions mean something else and are orthogonal to this conversation.
That said, the reality is that the 70th percentile of household income nationally is a little over $130K [0] and the US is a country with a population of around 341 Million people.
Therefore, you can have a self-sustaining consumer market with around 100 Million Americans who are members of households earning above $130k a year - you would end up with a significantly larger TAM than targeting the bottom 70%.
Most skilled (SWE, Accounting, Law), semi-skilled (Automation Engineer, Mechanic), civil service (Police, Teachers, Local government employees, Military), and union employees all marry people within this strata and remain in that strata.
[0] - https://dqydj.com/household-income-percentile-calculator/
By porridgeraisin 2026-02-1818:441 reply Doesn't this mean you get siloed economies? That is, the people below the 70th percentile have their own (maybe multiple) ecosystems? Quite similar to india1,india2 and india3 in the late 2010s. This should bring about income mobility right?
Exactly! And yes - you are seeing the developing of a concept similar to India or China 1/2/3 in Western markets now.
The reality is, America1 or France1 has tastes and sensibilities closer to India1 or China1 instead of America3. As such, there's no point targeting America3 or France3, because it doesn't dramatically grow your TAM the same way India1 or China1 could.
This is why Walmart and Amazon began pivoting heavily into the India and China consumer market in the mid-2010s.
The India 1/2/3 concept that Blume Ventures came up with is a modified version of a similar mental model we used to analyze China back in the 2000s and 2010s which itself is was forked from the principle of market segmentation.
By porridgeraisin 2026-02-1819:542 reply Why doesn't it make sense to target america2,3 though? What's a reason that wouldn't also apply to india2,3?
By alephnerd 2026-02-1916:53 It's the same principle why India1 doesn't target India2 or India3 - it negatively impacts brand positioning for marginal gain.
That's why you find different companies targeting different subsegments of a market globally.
Additionally, we do live in a globalized world, so a brand that is at the lower rung in one market may try to upscale their value by targeting the upper portion of another market. You see this with Walmart which targets America2 but uses a different strategy to target China1 (Sam's Club China) and India1 (Best Price, Flipkart).
Conversely, a China1 or India1 brand can also try and successfully build market share in America2 and America3 in a manner that an America1 brand wouldn't want to do due to brand prestige implications. This is why you see SHEIN and Temu's popularity amongst America2 and America3 or Wellspun becoming the primary supplier for textile goods for Walmart and TJX.
By usrnm 2026-02-1916:54 I guess, the idea is that you cannot target both America1 and America3 with the same product. Take into account that America3 doesn't have a lot of disposable income in the first place, and going after a similar target audience in another country becomes a much more sensible choice than trying to expand into a different audience in your own.
> What's a reason that wouldn't also apply to india2,3?
If I understand correctly, it would also apply to India2-3, that's why nobody's proposing that.
By giraffe_lady 2026-02-1818:141 reply Everyone loves to talk about neuromancer but missed when gibson went on to write a half dozen even more prescient books about exactly this process and its eventual consequences.
By nine_k 2026-02-1819:38 I personally am thankful to Gibson, and some other cyberpunk authors, for the ample warning they gave; many things ended up prescient. (Not that I heeded that warning enough, alas.)
By Eisenstein 2026-02-1818:13 I propose we should care about the majority of the population, and not do that.
By smogcutter 2026-02-1818:261 reply > Additive Manufacturing, industrial robotics, the Internet, and the proliferation of computers had already made large portions of manufacturing and low skill white collar jobs redundant by the mid-2010s.
I think a much more realistic explanation than robotics and 3d printing is the outsourcing of the social and environmental costs of industrialization to countries willing to bear it, like China, Vietnam and Mexico.
Containerized shipping, email, and computerized logistics have made globalization efficient, and therefore inevitable.
By alephnerd 2026-02-1818:30 Low skilled manufacturing had already left the US by the early 1990s with stragglers leaving by the early 2000s.
Heck, I used to live in LA as a kid at that time in the 90s and 2000s and the sweatshops (yes we had sweatshops) sewing clothes for Gap were staffed by undocumented Mexican, Korean, Thai, Chinese, and Vietnamese migrants in the Fashion District.
On the other hand, even highly paid manufacturing segments like automotive had already normalized industrial robotics by the early 2000s [0].
Basically, income mobility was already dead by the 1990s [1]. The difference is most Boomer HNers were insulated by that because it is clear almost everyone on HN who grew up during that era grew up in a 50th percentile and above household back then and wasn't the head of a household in the 1980-2005 period.
[0] - https://unece.org/sites/default/files/datastore/fileadmin/DA...
By burnt-resistor 2026-02-192:39 Because it's a funny money financialization bubble that seeks to perpetuate irrational exuberance as long as possible without regards to fundamentals or externalities.
By tonyedgecombe 2026-02-1818:521 reply > Job sector growth (after revisions down) has been almost entirely within the healthcare industry which is quite unsustainable.
Someone has to wipe our Boomer arses. An aging population means more healthcare and less of everything else.
By alephnerd 2026-02-1819:04 > Someone has to wipe our Boomer arses. An aging population means more healthcare and less of everything else
And a much more intense shift to financialization.
Pension funds tends to target an IRR of around 20-30%, and it is they that are the biggest pools of capital that funds invest.
You ain't hitting that amount of IRR without an extreme degree of financial ruthlessness.
