[nerdsniper]

I'm talking about as a society. There's no "1st law of thermodynamics" for the value of the money. If the world spends a shitload of money on something that doesn't pan out, that means we squandered actual finite resources - human labor, materials, and energy that we previously had.

Manufacturing ordnance just to blow up caves in Afghanistan that the USSR already just spent 20 years blowing up doesn't yield fruit - the materials and labor on both sides quite literally goes up in smoke.

Simply, it is absolutely the case that wealth sometimes gets destroyed rather than merely transferred. Sure, the fiat dollars might "just circulate" but that's an uninteresting, trivial tautology. When people talk about "losing money" in the general case, the meaning of those terms transcend the pedantic, trivial case that you espouse.

When the whole world gets feverish over an investment fad that's doomed to fail, "spending money on it" really means "allocating vast resources in the hope that we all get a return on that investment". If we don't get any return, all that investment truly is lost - destroyed, even. There have been cases where we (the humans of Planet Earth) had wealth that we could have done anything with, we chose to put it towards something that didn't work out, and now it's just gone.

(To be clear: I don’t think AI specifically is valueless)

[lemonademan]

The part of the bomb is an interesting perspective, and I do believe you are right on this one. Basically, you could blow up a place with a bomb you invested more in and achieve your particular goal, or not achieve it at all, and still lose money. I yield