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Google to pay SpaceX $920M a month for compute capacity at xAI data centers

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Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#831

Post by l23k4 »

worik wrote: post #799
JumpCrisscross wrote: post #696

Earlier quoted context omitted.

> just because yesterday's rules were "invest in S&P500" does not mean the governors of many (not all) funds cannot change the rules to dodge such blatant fraud There are no governors. The assets that automatically follow the S&P 500 are like individual IRAs. If a fund has a governing body, they're generally not indexing to a single narrow index like the S&P 500. They're going for a set of total-market funds, or they…

I said and I mean "huge", as in "very big" Passive index investing was once the best strategy, perhaps is still. But in the face of such apparent malfeasance perhaps no longer The big pension funds do have governors, they are mostly diligent and can change course that will mitigate but not eliminate the downsides to this nonsense

> But in the face of such apparent malfeasance perhaps no longer

Do you have any sources to share in support of this claim of malfeasance?

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#832

Post by l23k4 »

worik wrote: post #686
l23k4 wrote: post #463

Earlier quoted context omitted.

It is what S&P Dow Jones Indices themselves say, so the burden of proof to prove otherwise must fall on you. And anyway, the rule change is truly the only reasonable way they can react to the current situation. It will absolutely be untenable to keep Anthropic , OpenAI and SpaceX off the S&P 500 with them also being the highest valued companies on the market.

> It will absolutely be untenable to keep Anthropic , OpenAI and SpaceX off the S&P 500 with them also being the highest valued companies on the market. Following the rules of passive indexes is the whole point. Mēh! The passive indexes (biased to a momentum strategy, so not really passive - they are too big) may have had their day. The blatantly corrupt move to change the rules was clearly an attempt to game them, a…

>Following the rules of passive indexes is the whole point.

The whole point of these indices is to represent the market, the rules are unsustainable if they cause too big of a divergence from that goal.

> The blatantly corrupt move to change the rules

Why do you think nobody in the financial press is reporting on this blatant corruption? Is it because this conspiracy also includes all of the news media?

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#834

Post by ChuckMcM »

runako wrote: post #281

Since the S-1 filing, xAI has taken over and is likely the largest share of revenue. I would estimate that ~95%+ of xAI revenue, and 100% of its profit, is from renting their datacenters. This is a datacenter REIT bolted onto a social media company bolted onto launch business bolted onto a niche ISP. The expected price to sales is ~100x. The best datacenter REITs trade at ~10x and pay a dividend, which SpaceX does no…

Yes, yes it is. (going to be painful) If the IPO gets fully subscribed. For a long time I've pointed out that after the dot com crash the 'unicorns' were mostly on private markets and when they washed out only the 'qualified' investors got hurt (and of course their employees needed to find new jobs). The retail investors were protected because the SEC made sure you couldn't lie to them without penalties.

Once the SEC got defanged, retail investors once again became the primary target.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#835

Post by gitaarik »

cherry_tree wrote: post #93
sheepscreek wrote: post #71

Earlier quoted context omitted.

It’s exceptionally fast at it too. I love using it for looking up things where recency matters.

[flagged]

That's maybe a bit of an unfair, out-of-balance comment. Google Gemini had it's own fails on the other side of the extreme. Both have corrected themselves. Don't keep coming up with old stuff.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#836

Post by [deleted] »

Robotbeat wrote: post #754
kube-system wrote: post #748

Earlier quoted context omitted.

Comcast is a successful business in spite of their customer satisfaction. You don’t need to please your customers when when you can involuntarily extract their money anyway.

Comcast is not a rapidly growing company, though. This isn’t hypothetical. SpaceX is increasing Starlink revenue by like 50% per year. And their current Starlink constellation, about 10,000 satellites, has been launched entirely by Falcon 9. They’ve been waiting to launch much larger satellites on starship (in fact they had versions of these ready for several years now, and recently did suborbital tests of some of th…

[deleted]

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#837

Post by ifwinterco »

Gareth321 wrote: post #580
davedx wrote: post #484

Earlier quoted context omitted.

Start gradually converting your equity to bonds is the standard advice on that timeframe. If you're dreading equity drawdowns, that's what fixed income is for.

Bonds are no longer recommended. Current research indicates 100% equities to be the best composition leading up to, and past, retirement. To point, the economic uncertainties around geopolitics, AI, and war, plus irresponsible debt spending by governments and the prospect of QE (and higher inflation), is pushing long term rates steadily higher. There’s a reasonable chance that 30y treasuries are nearing 6% by the end…

Bonds will give you poor (probably negative) real returns, but if you're 10-20 years away from dying you're more concerned with wealth preservation than growing your wealth.

People have forgotten this but equities are an infinite duration asset that are prone to periodic, significant, often violent crashes.

(Edit: often at a time when everyone is absolutely convinced they're the best asset class...)

You can keep some equity exposure but you don't want 1929 or 2008 to happen the day after you retire when you might live for another 30 years

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#838

Post by ifwinterco »

solenoid0937 wrote: post #721
rootusrootus wrote: post #609

Earlier quoted context omitted.

I feel like I should go learn some more. I'm not in a pure index fund, I'm really in VFORX (almost completely, I'm not too original nor sophisticated financially and don't try to pick my own stock picks these days except with my "lunch money" just for fun). Do you think something like VFORX is a bad option? It's actively managed, so the fees will be a little higher than a pure index fund, but it's Vanguard and the fe…

Active management in general is a poor idea. You'll get better risk adjusted returns by investing in total world equities (like VT). Check out Bogleheads to learn the basics. If you want to get more advanced, you can learn about factor investing as well, but VT is enough for the vast majority. If you want to get intuition for why this works , this is a really fun and interesting video: https://youtu.be/TQuxVz52w2w

The boglehead approach has worked fantastically for ~40 years, but now that everyone is doing it, it may no longer be the case going forwards.

Normally with these things when absolutely everyone is crowded on one side of the boat, you want to be on the other side

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#839

Post by walletdrainer »

krupan wrote: post #667
l23k4 wrote: post #555

Earlier quoted context omitted.

[flagged]

Ok, now we are getting somewhere. There is no guarantee that they will be a big part of the stock market. It is not "absolutely" sure, for them or for any new public stock. That's why the indices have/had the the rules they (used) to have, to wait and see if a newly IPOed stock actually becomes a big part of the market before it becomes part of the index. Why did they change the rules for these companies? That's what…

> There is no guarantee that they will be a big part of the stock market. It is not "absolutely" sure, for them or for any new public stock

It's really hard to believe that you'd be writing this in good faith.

In reality, even without being publicly listed(!), these companies have already managed to become an absolutely massive part of the market. After the IPO? Hah.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#840

Post by wqaatwt »

GMoromisato wrote: post #706
pqtyw wrote: post #576

Earlier quoted context omitted.

Yeah sure the technical problems are solvable if you throw money at them. I'm sure we could have had a colony on Mars by this point as well if NASA/etc. continuously spent insane massive amounts of money on every year since the 70s. So what? Why on earth would you want an AI datacenter in space? Like what would you gain by doing that at an absurdly higher cost than you could build on them earth? "Free" energy? lol..…

You just said that "building your own datacentres is very expensive and more importantly takes a lot of time." I agree. If building data centers in space is cheaper and takes less time, then that's a win and a clear reason to do it. Costs for terrestrial data centers keep going up and costs for space tech keep going down. At some point, they will intersect.

> If building data centers in space is cheaper

So you don’t have an argument because everything you are saying is based on some absurdly speculative nonsensical premise?

> costs for space tech keep going down

How do you measure the cost of something which does not and has not ever existed. These data centers are a hypothetical concept nothing else.

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