The math used for training AI—minimizing the gap between an internal model and external reality—also governs economics. Successful economic agents (individuals, companies, societies) are those with the most accurate internal maps of reality, allowing them to better predict outcomes and persist over time.

Emad Mostaque proposes a new digital currency where mining is replaced by dedicating compute to public-good AI projects like cancer research. The value of the "Foundation Coin" is backed by its direct contribution to human benefit, creating an incentive structure for building aligned, open-source AI infrastructure.

The price mechanism in capitalism is a successful but lossy compression of complex economic information into a single number: money. AI agents can operate on the uncompressed, real-time data of supply and demand across the economy, creating a more efficient system that avoids the waste inherent in capitalism's information loss.

Economics can be viewed as the physics of information, where profit is the surplus created when intelligent agents organize chaos into useful order (reduce entropy) faster than the system naturally decays back into disorder.

OpenAI's new GDPVal framework evaluates AI on real-world knowledge work. It found frontier models produce work rated equal to or better than human experts nearly 50% of the time, while being 100 times faster and cheaper. This provides a direct measure of impending economic transformation.

AI agents, powered by GPUs, don't need to eat, sleep, or consume goods. This "metabolic rift" breaks the traditional economic loop where labor's earnings fuel consumption, creating a system where production is divorced from human needs and participation.

Emad Mostaque argues that as AI makes intelligence abundant (e.g., free expert medical advice), our economic system, which is built on scarcity, interprets the resulting job displacement and disruption as poverty, even if overall well-being improves.

While GenAI continues the "learn by example" paradigm of machine learning, its ability to create novel content like images and language is a fundamental step-change. It moves beyond simply predicting patterns to generating entirely new outputs, representing a significant evolution in computing.

Capitalism values scarcity. AI's core disruption is not just automating tasks, but making human-like intellectual labor so abundant that its market value approaches zero. This breaks the fundamental economic loop of trading scarce labor for wages.