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Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

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Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#91

Post by laughing_man »

walrus01 wrote: post #8
darth_avocado wrote: post #3

Well technically they don’t own the debt, the SPVs that own the data centers do. The giants just have long term commitments, but if shit hits the fan, it’s not the tech giants but the banks that lent the money to the SPVs that are at risk. This usually means all of us are on the hook.

If I owe the bank $750,000 and can't pay, it's my problem. If I owe the bank $1,750,000,000 and can't pay, it's the bank's problem.

I don't know. The guy I bought my house from owed the bank $400k. He didn't make any payments for two years, and then they paid him $20k to go away.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#92

Post by laughing_man »

King-Aaron wrote: post #13

These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them.

If they bail them out it should be done like the GM bailout. Shareholders leave with nothing.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#93

Post by King-Aaron »

dartharva wrote: post #37
King-Aaron wrote: post #13

These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them.

They'll bail them out with what money? US is already almost $40T in debt, how do you think the bond market would react if another $2T were abruptly added to it?

Look at how the pentagon is funded. Trillions get poured in with zero accountability, dark projects that never get disclosed at all, and audits that never pass.

When it comes to military level stuff, it seems to exist outside of normal financial logic. They just invent money for it.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#94

Post by King-Aaron »

WoodenChair wrote: post #30
King-Aaron wrote: post #13

These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them.

> These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them. According to Wikipedia, the Manhattan project only cost $28 billion in 2024 dollars. That's a completely different order of magnitude compared to what we're talking about here. I imagine the size of the investment here would even be hard for the US go…

I just made a similar comment further down the chain here, but I frankly think the dollars and cents economics around AI is a moot point. Like the pentagon, they'll just pull money out of thin air, or from other departments, or just write things off like it never existed.

I don't actually think the current administration, or the people behind it, actually care about real world economics anymore.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#95

Post by bogdan »

rmunn wrote: post #53
richardw wrote: post #24

Earlier quoted context omitted.

If the US companies need trillions to barely beat Chinese companies spending billions, despite a multi year head start...

That's the difference between innovating and copying/distilling someone else's innovation. https://wccftech.com/chinas-kimi-k3-identifies-itself-as-ant...

I'll link to this comment as a rebuttal https://news.ycombinator.com/item?id=48984531

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#96

Post by elictronic »

tchalla wrote: post #19
King-Aaron wrote: post #13

These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them.

The advantages of being a reserve currency and then also blaming your peer competitors as “manipulators”.

China is a currency manipulator who steals patents and ideas from other countries. The US uses the reserve currency as it's most beneficial soft power. The Petrodollar is the clearest example of this by a large margin.

Both are true.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#97

Post by axegon_ »

ItsBob wrote: post #82

It's hard not to be fatalistic about all of this now: In my mind, it's crystal clear that the investments will never be paid back. The revenue streams from all the companies involved don't add up. It must fail at this point. That means losses. Big losses for some. I assume that these off-the-books companies can quite literally be pinched off and the debt becomes the banks' problem, so the primary company, i.e. Meta,…

And every time some points all of this out, they are "denier", "left behind" and all the other everything-ai fanatics can come up with. As for the imminent crash - I'm all for it. There's a whole generation that is incapable of thinking for themselves without an LLM telling them what to do or worse still - do it for them. And for much of the tech world, that is becoming the single point of failure.

As for China - I think their motivation is clear: if they could have pulled it off from the start, their business model would have been the same as MANGO's. Llamacpp opened up the floodgates and their best bet now is to use this and their resources to start pulling the rug from underneath MANGO. I'm not a fan of the "enemy of my enemy" philosophy - they can both be enemies but wile they are at each-other's throats (albeit not openly), I'll gladly sit back and grab some pop-corn.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#98

Post by m101 »

The banks are not the ones on the hook here - they no longer lend in a meaningful way as first loss lender on many things. If they lend they do so as a senior financing provider to vehicles that provide the financing.

The actual lending is done by private credit institutions that have raised money, sometimes on the order of 10s of billions of $.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#99

Post by joe_the_user »

AznHisoka wrote: post #4
darth_avocado wrote: post #3

Well technically they don’t own the debt, the SPVs that own the data centers do. The giants just have long term commitments, but if shit hits the fan, it’s not the tech giants but the banks that lent the money to the SPVs that are at risk. This usually means all of us are on the hook.

As someone who belongs to “all of us”, i vote to not bail us out if shit hits the fan. No need to ask me when it happens, OK? No really, it’s nice of you but we really dont need to be bailed out. You are welcome :)

Unfortunately, the votes for a regime of permanent bailouts were already in when Ben Barnacke made his famous speech proposing helicopters over cities if deflation reached a crisis level (though the Internet says Milton Friedman thought of this first). Some later observed "the helicopters only seem to go to Wall Street", which isn't surprising.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#100

Post by londons_explore »

laughing_man wrote: post #51
AznHisoka wrote: post #4

Earlier quoted context omitted.

As someone who belongs to “all of us”, i vote to not bail us out if shit hits the fan. No need to ask me when it happens, OK? No really, it’s nice of you but we really dont need to be bailed out. You are welcome :)

The problem is if large banks fail they take everyone else with them. We should have dealt with this in 2009, but for some reason it didn't happen. But money talks, I guess.

Iceland let it's banks default, and is now doing rather well.

In fact, bank failure and then having the government only guarantee ~$50k of funds per person is a good way to hand wealth to the people and take it from corporations and the super wealthy.

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