AI Companies Are Trying to Hide a Staggering Amount of Debt • Hacker News Board

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#401

Post by HDThoreaun » Sat, Jul 25, 2026, 6:07 PM UTC

oblio wrote: post #286

HDThoreaun wrote: post #230

Earlier quoted context omitted.

Because this isnt actaully debt. Almost all of it is agreements to pay for completed datacenters from developers. Its just a way to offload operational risk when constructing datacenters. If the construction somehow fails theyre not stuck with the bill.

> If the construction somehow fails theyre not stuck with the bill. Who is stuck with that bill and what is their ultimately their primary source of financing?

Well theyre locking in the price now. They go to developers and offer to sign exclusive leases on a datacenter they designed that isnt built yet. This strategy offloads risk to the developer because theyre the ones who need to ensure the dc gets built on time and budget in order to get paid. Yes, the biggest costs here is the hardware, but theres still tons of other issues to figure out before you get to hardware install and these conditional leases make it so they dont need to worry about that stuff.

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#402

Post by intrasight » Mon, Jul 27, 2026, 2:24 AM UTC

duzer65657 wrote: post #180

intrasight wrote: post #163

Earlier quoted context omitted.

My homeowners insurance isn't "cost-effective" either but I still do it. I think the reason that investors don't is because they are greedy or irrational or both. That was the message that I got from a financial podcast I listened to a couple weeks ago anyway.

investors are irrational but actually tend to go the other way - too risk adverse. I'm not sure what a "greedy" investor is, TBH.

Yeah "greedy" is not really the right word. What I meant was not properly managing.

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#403

Post by intrasight » Mon, Jul 27, 2026, 3:18 AM UTC

Marsymars wrote: post #254

kipchak wrote: post #204

Earlier quoted context omitted.

I think the risk for increasing your bond exposure as compensation would be if instead of a low growth/low inflation scenario (Bonds do well) there's a low growth+high inflation scenario (1940s, 1970s, 2022) and the negative correlation between stocks and bonds doesn't hold.

Yeah, but in the abstract that's just saying "if you time the market, you can beat it", and we know that generally, the only way people are able to time the market is with random luck. And more specifically, it's not low growth/high inflation that kills bond portfolio returns, it's interest rates increasing that devalue bonds, i.e. the transition from low inflation to high inflation. So yeah, you can construct a port…

>the only way people are able to time the market is with random luck.

No. With insider information.

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#404

Post by rockskon » Mon, Jul 27, 2026, 9:08 AM UTC

riffraff wrote: post #347

rockskon wrote: post #141

Earlier quoted context omitted.

It is unlikely that a 50% drop in NVidia wouldn't be paired with a significant drop in the valuation of every other company heavily invested in AI.

Of course, but the top ten that make up >30% of the market don't just sell AI. If all of those lost 50% it would be a 15% drop in the index, painful but not jumping-off-building bad

What of most of the rest of the US economy thats keeps trying to shoehorn AI into their workflows and, more importantly, whose stock prices are buoyed by the prospect of theoretical AI-related productivity gains?

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#405

Post by polski-g » Tue, Jul 28, 2026, 11:18 PM UTC

zipy124 wrote: post #370

polski-g wrote: post #341

Earlier quoted context omitted.

H100 rental costs are increasing. If anything those GPUs should not be marked down at all. Burry is wrong.

Is this true? The best data I could find is that A100 costs are decreasing slightly, H100's have been holding steady and B-series have been increasing?

https://x.com/i/status/2082168950649979109

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#406

Post by conductr » Wed, Jul 29, 2026, 4:36 PM UTC

DangitBobby wrote: post #386

waterTanuki wrote: post #312

Earlier quoted context omitted.

It is a given. Unless the Trump admin figures out how to ban 1s and 0s, you can't stop Chinese labs from open sourcing their models. They can certainly ban new providers from using the Chinese models, but they can't ban Canadian ones, European ones, other Asian countries etc. from setting up provider proxies and bypassing those rules. Then what, great firewall of USA? Block off all internet traffic to other countries…

Yes, banning 1s and 0s is completely impossible and unprecedented /s. I wouldn't choose either as a default until the dust settles. Either way, I wanted to point out the unstated assumption. Whether you personally believe it's a foregone conclusion or not, it's an essential part of the logic chain that not everyone will agree to.

It's a gamble, stats, so what is the probability that moat can be protected to the tune of trillions of dollars of incremental enterprise value creation in the AI industry? Would you bet your retirement funds on it? Would you want the government to bail them out if a financial collapse occurs because of it? I think most reasonable people do not think it's worth the risk, and the more important part I highlighted is the fundamental economics of this industry were never worth the investment/risk. Clever capitalists will always find a way, which this accounting shell game is evidence of.

Re: AI Companies Are Trying to Hide a Staggering Amount of Debt

#407

Post by niemandhier » Thu, Jul 30, 2026, 9:10 PM UTC

alex43578 wrote: post #388

niemandhier wrote: post #364

Earlier quoted context omitted.

I took the liberty of computing my and my wife’s effective income tax burden: 24% We are both German and in the 92nd percentile of the income distribution.

I’m assuming you mean you’re in the top 8 percent of income distribution? Ie about 90,000 euros? If so, by my rough math, you’re paying about 25% more in taxes than an equivalent American couple based on PPP. That American couple would have about $30K USD/26K Euro more in disposable income, would likely have good quality health insurance paid for by their job, be eligible for $3K to $4K in social security retirement…

I did all that math a while ago when I was offered a well paying job in California .

Bottom line was that stuff is so much cheaper here than over there, that not much would have changed. We’d be able to save up a lot of money if we were willing to live frugally in the US though.

In the end the volatility of the current American political landscape in addition to the hostile immigration laws made it unattractive to move, at least for now.