The Great Artificial Intelligence bubble and Scam has made inroads into all facets of American life. The scam of the self checker at your local grocery store is a prime example, and certainly the same arguments can be made about self driving cars, and other artificial intelligence. These all seem to be an attempt to sell unproven and overhyped technology to business and individuals to make money, whether the general concept itself is valid or not! 

Before we look into the economic ramifications of this scam, turned bubble, we can review some weaknesses already made evident.

Because of Amazon's (AMZN) interest in artificial intelligence and Bezos's purchase of Whole Foods (WFM), we should check out the grocery scene more carefully. We know from personal experience that if you have produce, checking out become complicated and time consuming. If you press the wrong button the little machine freezes up and forces you to raise your hand for the kiosk monitor to come and help you. 

It has gotten so bad that Albertsons, a large chain in the west, has taken out all its self checking kiosks with the exception of some high traffic stores. In my area of residence in Nevada, this does not appear to have hurt Albertsons at all. It is one of the fastest growing chains. 

Whole Foods has succeeded in the past by having personal customer service. If Amazon stops this and introduces kiosks, it could radically destroy business for its stores. 

Whole Foods is introducing 365 stores with kiosks, and a large percentage of the population simply will not shop at these stores. They have little social interaction and few products. 

The Amazon attack on mainstreet is likely a significant tactical error, and will ultimately turn many people against technology. 

Here is a dire warning from Steve Kaufman, a long time follower of the store design industry:

Whole Foods shopper doesn’t go there for Bounty and Kleenex. She’s looking for 100-percent organic, recycled, hypoallergenic.

And she likes going there. Whole Foods is exactly the model of social interaction that e-commerce lacks. She likes chatting up the guy across the fresh fish counter who’s picking out her Chilean sea bass filets. She likes seeing what’s fresh in the deli counter and bakery. She likes ladling her own lobster bisque into a container. She likes having her cup of coffee and a croissant at one of the tables. And she likes the high-quality standards. She’s willing to pay for those.
So either Whole Foods is going to have to lower its standards (and its prices), or Amazon is going to have to raise its. 

We know that Whole Foods is lowering prices, but threatening to employ fewer workers, a definite red flag for many female shoppers. Amazon needs to raise standards and lower prices. And it can't do both. 

I have written about the Self Driving Car. The technology is put into electric cars, ballooning the price tag, while still being unproven and downright dangerous. It appears to be a scam. About the first of 10 reasons why self driving technology is useless, I said:

1. They run red lights and when they do it is blamed on the driver for not taking over. But clearly when a driver has to take over at a critical juncture, it is much safer for the driver to always be attentive. The driver cannot always be attentive when the car is doing the driving. It is human nature to not be attentive. This is the fatal flaw of self driving cars, that drivers must intercept critical mistakes the cars make. If you have to be more alert driving a self driving car than when driving a manually driven car what on earth is the self driving car good for? Nothing, it is good for nothing.

Artificial intelligence has scam written all over it. I am not saying that artificial narrow intelligence is a scam. There is evidence it even fights fraud in finance. But the idea that Hal is on the way, that general human intelligence will be found in a computer, is ludicrous.

In short, the AI that is reshaping our societies and economies is far removed from the vision articulated in 1955 at Dartmouth, or implicit in such cinematic avatars as HAL and Lieutenant Data. Modern AI is founded on computer-age statistical inference—not on an approximation or simulation of what we believe human intelligence to be. The increasing ubiquity of such applications will track the inexorable growth of digital technology. But they will not bring us closer to the original vision articulated at Dartmouth. Appreciating this is crucial for understanding both the promise and the perils of real-world AI.

Real artificial intelligence has more to do with humans benefiting from their relationships with computers and technology:

• Planning a trip using GPS apps like Waze
• Using Google Translate to help translate a document
• Navigating massive numbers of book or movie choices using menus of personalized recommendations
• Using Internet search to facilitate the process of researching and writing an article

Computers are important tools in the analysis of data. So, there are advanced explanations of these processes, which we must note, have their limitations and if you read on, will find have their detractors and skeptics:

Artificial Neural Network

Genetic Algorithm

The limitations are really what science fiction is made of and nothing has changed. The concept of a general human intelligence simply is not doable in the near future, and most likely never. 

The temptation to scam in all these new technologies is great. Companies and individuals should keep their guard up, making sure they are not paying for something that will not produce the results they desire. These tech giants who are producing this technology are in business to make money. Determining whether they are moral actors or simply carnival barkers is crucial to your financial well being going forward. 

Particular attention should be given to cutting edge artificial intelligence. Artificial intelligence is being misused by men out of pure greed, in my opinion. This is a definition of AI that we should all take seriously, because much of this technology is dependent upon human models, and claims have been made about the technology that simply cannot be delivered:

Capabilities generally classified as AI, as of 2017, include successfully understanding human speech,^[5] competing at a high level in strategic game systems (such as chess and Go^[6]), autonomous cars, intelligent routing in content delivery networks, military simulations, and interpreting complex data.

Keep in mind that in the case of self driving cars, advertising them in such a way as to make people think they can replace human intelligence is quite simply a scam!  

We can remember the algorithms that went into the housing bubble. We can remember how all loans could not possibly go bad all at once, since the models that were used said so. Models don't always reflect reality, and a hard lesson was learned when risk was mispriced due to flawed models. 

Some, like Eugene Kaspersky,  have said that the artificial intelligence movement is a huge bubble ready to burst:

In the aftermath of the AI-bubble’s popping, all similar fields will inevitably suffer. “Machine learning? Neural networks? Behavioral detection? Cognitive analysis? Arrrgh – more buzzwords à la artificial intelligence? No thanks: don’t wanna know. Actually: wouldn’t touch any of that with a barge pole.”!
It gets worse: the curse of the AI-bubble will dull interest in promising technologies for many years, just like in the 80s.

And that from a guy, Kaspersky, who believes that ultimately machines could become Hal, improving themselves without man's involvement, in a distant future. But for now, beware of the bubble in AI. As Kaspersky says:

AI-bubbles are somewhat reminiscent of the 2008 real estate market bubble in the US, which snowballed swiftly into the global financial crisis. The pyramid of investment sub-products based on subprime mortgages suited a lot of people: millions of folks did very nicely from it, thank you very much; and tens of thousands of them did amazingly from it (thanks a million:). And then – boom: the pyramid came tumbling down, the world economy began to sway, and the holes were bunged up with taxpayer money to avoid financial Armageddon – taxpayers of course being those same folks and companies that made the money in the first place. Not aware of the scam scandal of the decade? Then watch the film The Big Short.