The first half of your post, I broadly agree with.

The last part...I'm not sure. The idea that we will be able to compute-scale our way out of practically anything is so much taken for granted these days that many people seem to have lost sight of the fact that we have genuinely hit diminishing returns—first in the general-purpose computing scaling (end of Moore's Law, etc), and more recently in the ability to scale LLMs. There is no longer a guarantee that we can improve the performance of training, at the very least, for the larger models by more than a few percent, no matter how much new tech we throw at it. At least until we hit another major breakthrough (either hardware or software), and by their very nature those cannot be counted on.

Even if we can squeeze out a few more percent—or a few more tens of percent—of optimizations on training and inference, to the best of my understanding, that's going to be orders of magnitude too little yet to allow for running the full-size major models on consumer-level equipment.