+AI & ROI
How +AI Changes the Structure of Demand
Discussions around AI often focus on productivity gains or cost reductions.
However, a more important and less discussed effect of +AI lies in how it transforms the structure of ROI (Return on Investment) itself.
The key insight is simple but powerful:
+AI primarily reduces the denominator of ROI — the Investment.
This structural shift has consequences far beyond efficiency gains.
+AI Shrinks the Investment Side of ROI
ROI is defined as:
ROI = Return / Investment
Most technological progress attempts to increase the Return.
+AI, however, does something different:
• It dramatically lowers initial costs
• It reduces human labor requirements
• It eliminates the need for large-scale upfront infrastructure in many domains
As a result, projects that previously failed to meet ROI thresholds suddenly become viable.
This is not optimization at the margin —
it is a redefinition of who can participate.
Lower Investment Does Not Reduce Demand — It Expands It
A common misconception is:
Cost reduction leads to demand destruction.
In reality, with +AI, the opposite happens.
When the Investment required to act decreases:
• Small organizations can execute projects
• Individuals can deploy tools previously reserved for large enterprises
• Marginal ideas become economically feasible
• Non-commercial and semi-commercial activities enter the ROI-positive zone
In short:
+AI does not merely increase ROI — it unlocks suppressed demand.
This is not demand being pulled forward from the future.
It is demand that always existed but could not be expressed due to cost barriers.
Structural Demand Is Why AI-Related Real Assets Stay Strong
Because +AI expands participation rather than concentrates it,
the physical inputs behind AI systems face structural demand growth.
Key examples include:
• Silver and Copper
Used in semiconductors, data centers, power distribution, and cooling systems.
• Electric Power
AI efficiency does not reduce energy usage; it increases total utilization by enabling more activity.
Even if AI services become cheaper per unit, total consumption rises.
This leads to an important conclusion:
Prices of AI-related real assets are structurally resistant to decline.
They may fluctuate, but their demand base continues to widen.
Why This Is Not a Typical “AI Bubble”
Traditional bubbles are driven by:
• Overestimated future returns
• Speculative front-loading of demand
The current +AI cycle is different:
• The core driver is Investment reduction
• Participation expands instead of concentrates
• Physical infrastructure usage grows alongside software efficiency
This makes the system more resilient than valuation-based narratives suggest.
Conclusion
+AI changes ROI at its foundation.
By shrinking the Investment required to act, it:
• Raises ROI across society
• Enables new participants
• Expands real economic activity
• Creates sustained demand for physical resources like metals and energy
Understanding +AI through the lens of ROI structure — not hype —
reveals why its economic impact is likely to persist rather than collapse.