Thanks for pointing this out. Can you clarify why the EV is so much lower when taking the standard deduction?

A better argument is that the wildness of the next century means our models of the future are untrustworthy, which should make us pretty suspicious of any claim that something is the P = 1 - ε outcome without a watertight case for the proposition.

There doesn't seem to be such a watertight case for AI takeover. Most threat models^[1] rest heavily on the assumption that transformative AI will be single-mindedly optimizing for some (misspecified or mislearned) utility function, as opposed to e.g. following a bunch of contextually-activated policies^[2]. While this is plausible, and thus warrants significant effort to prevent, it's far from clear that this is even the most likely outcome "absent highly specific conditions", never mind a near certainty.

1. ^{^}

   e.g. Cotra and Ngo et al

2. ^{^}

   as proposed e.g. by shard theory

It appears the UK's index-linked gilts, at least, don't have this structural issue.

See "redemption payments" on page 6 of this document, or put in a sufficiently large negative inflation assumption here.

One possible explanation is an expectation of massive deflation (perhaps due to AI-caused decreases in production costs) which the structure of Treasury Inflation Protected Securities (TIPS) and other inflation-linked government bonds — the source of your real interest rate data — doesn't account for.

While TIPS adjust the principal (and corresponding coupons) up and down over time according to changes in the consumer price index, you ALWAYS get at least the initial principal back at maturity. Typical "yield" calculations, however, are based on the assumption that you get your inflation-adjusted principal back (which you do if inflation was positive over its term, as it usually would be historically).

This means that iff there's net deflation over its term, the "yield" underestimates your real rate of return with TIPS by the amount of that deflation.