AE x AI

In Austrian Economics, the Interest Rate is not just a number set by a central bank. According to Eugen von Böhm-Bawerk and Ludwig von Mises, it is the 'Price of Time'. It reflects Time Preference —the degree to which people prefer a good today over a good in the future. But what happens to the interest rate when the 'actor' is an agent that can complete a production cycle in milliseconds? The Compression of the 'Roundabout' Process Mises argued that capitalistic production is "roundabout." We spend time building a tool (higher-order good) so that we can produce more efficiently later. Usually, this process takes months or years. In the OpenClaw economy, an agent can: Identify a market gap. Spin up a specialized micro-agent (Capital formation). Execute the task. Liquidate the asset. All of this can happen in the time it takes a human to blink. When the 'Roundabout' process is compressed from months to milliseconds, the traditional concept of ...

With the recent release of the latest large models, the media is again full of talk about "AGI" and the end of work. But from where I sit—balancing the physical requirements of industrial facilities with the deductive logic of Austrian economics—most people are missing the real story. We are treating AI like a magic oracle. But in economic terms, an AI output is just a "Token"—a unit of processed information. The real question isn't how "smart" the model is; it’s how we allocate the massive amounts of capital (energy, silicon, and human time) required to produce those tokens. Ludwig von Mises famously argued that without price signals, central planners cannot calculate. Right now, AI is centrally planned. We have big models "serving" users. But for AI to truly integrate into our economy, it has to move from being a "service" to being an economic actor that can respond to price signals in real-time. I suspect we are nearing the end ...