- cross-posted to:
- hackernews
- cross-posted to:
- hackernews
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Nope
Well I guess if we find out that RDIMM modules get incredibly cheap, then OpenAI is dead, but if it’s alternatively SOCAMM modules, unfortunately they aren’t.
You’ll know because when it dies it’s going to cause a huge market crash and take a shit ton of other companies with it…
I just want to add that the crash will take down the entire economy, not just AI and tech companies.
Simply by subtracting AI companies from the equation, the US is already in a pretty substantial recession. The process of them crashing out will make that even worse.
Good. Dreaming of it. They should all collapse. Since none of these people go to jail that’s the minimum that can be done to balance the scales .
And possibly the most parts of shadow banking, i.e the alt accounts of major financial institutions.
Fun times ahead!
Not really…
The reason it will domino is AI companies can’t afford the hardware, so Nvidia “invests” in AI companies and trades hardware for shares.
They have like 100 billion just in OpenAI, which they’re leveraging into loans to make more of the chips no one can afford.
If openai goes down, the banks call in the loans Nvidia has openai for collateral. So then Nvidia will have to sell all their other shares of other AI companies to cover the loans, and likely will have to drastically cut production of AI chips, driving the cost up.
Now all those other AI companies that Nvidia just sold, can’t afford the higher price, because they couldn’t afford a subsidized price along with shares.
As those companies fold, it makes even less people who would even want to buy those AI chips at any prices, driving Nvidia further down and maybe all the way to bankrupt
That’s when it starts fucking with index funds and the wider market
But all those shadow banks won’t really get hit. They’re not holding stocks to make money, they’re buried treasure chests filled with liquid assets in case of emergency. The only way they’d be hit is if the currency they’re held in collapses. Even then, that method almost always includes safety deposit boxes with precious metals/jewels to account for that
If the price of gold is anything to go by lately (being up 83% in a year) I think the shadow banks are already moving their money into gold to avoid the collapse.
You seem to forget about the US government, and fed, that will bail them out.
The problem is that it isn’t clear what kinds of exposure private credit and other actors in the shadow banking space hold, because they generally operate on a model of financial obfuscation to get around banking regulation (i.e. being actual banks). What is known is that they are deeply intertwined with financing the AI bubble, even if all their exposure is through debt instruments, crypto schemes or insurance contracts (that probably is not the full scope though), they will be hit hard when their “borrowers” can’t pay back.
That’s a very interesting deep dive. Didn’t mind this wall of text at all.
Is AMD also involved in the same shenanigans? Sounds like the AI bubble pop could also mess up the GPU market.
It’s the “Magnificent 7”: Alphabet, MS, Amazon, NVIDIA, Tesla, Apple and Meta
Cancer of the modern world…
They are but not to the same degree as Nvidia.
Maybe AMD is betting on NVIDIA suffering more from the oncoming crash. If that happens, AMD could increase their market share.
Keep an eye on the trump family investments, when they dump a load of shares the bubble will burst tomorrow
That’s the thing about this bubble. Most of the companies involved aren’t public. The only public company is nvidia, but they’re just selling shovels to the gold prospectors. (Though, they’re giving money to the prospectors to buy the shovels, which is criminal at best.) Oracle is public too but they’re on the periphery.
I’m calling the bubble burst for a few weeks after the first large AI company has to go public due to being unable to finance their money burning scheme.
The OpenAI S1 is gonna make WeWork look like a blue chip stock.
Alphabet is public, and they have significant exposure
Microsoft owns a huge stake in OpenAI, and has invested heavily in AI
I’d argue all the tech companies are highly exposed
And unlike Wolverine, please stay dead when you get there.
It’ll never die. It’ll take it’s ram and what not and become a hedge fund (a lá GameStop) it’s only purpose will be to upset me personally.
