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money printer is takin' a break > And unlike earlier periods of heavy debt, the Federal Reserve is no longer a big buyer of Treasuries, placing a heavy burden on private-sector investors.
Has anyone seen a definitive mathematical proof of this? I have seen countless articles and exposes about the hidden debt. These are incredibly sophisticated companies so presumably they wouldn’t let themselves get into a company ending bind. But what are the chances this is actually an MBS type situation where the system is truly overloaded and a few sacrificial lambs are needed?
FWIW Enron was also a „sophisticated company“ at the time
> AI’s insatiable need for debt has so far been matched by investors’ appetite for it, but they may turn nauseous on the belly-busting volumes coming from tech giants. Headline doesn't really match the facts in the article. The article seems to say "hyperscalers are borrowing an enormous amount and so far people are lending to them. Other people are worried that this will stop".
My future's so bright I gotta' wear million dollar shades.
> AI’s insatiable need for debt has so far been matched by investors’ appetite for it, but they may turn nauseous on the belly-busting volumes coming from tech giants. Headline doesn't really match the facts in the article. The article seems to say "hyperscalers are borrowing an enormous amount and so far people are lending to them. Other people are worried that this will stop".
You say this as if when "lending stops", it isn't a big deal. What you're describing is a concern for a collapse in finance markets.
As a bystander directly immune to the fortunes of AI going up or down, it does feel like there are a lot more people thinking this is inning 9 of the LLM story than there are people thinking it's inning 3. Which makes it tempting to believe it's probably closer to inning 3.
We have only begun to extract the value of commoditized intelligence. Sure there are arguments on local models and pricing power.. but I think we will be compute constrained for the near future.
Earlier quoted context omitted.
money printer is takin' a break > And unlike earlier periods of heavy debt, the Federal Reserve is no longer a big buyer of Treasuries, placing a heavy burden on private-sector investors.
pretty sure they’re literally printing useable currency with Trump’s face on it, cause printing money is cool again
You may have seen the headline recently where Sec. Bessent held up a mockup of a bill printed out on a regular sheet of letter paper[0], and there's bill circulating to change the law, but it will not pass[1].
0: https://ichef.bbci.co.uk/news/1536/cpsprodpb/97ed/live/f6126...
1: https://www.congress.gov/bill/119th-congress/house-bill/1761
Has anyone seen a definitive mathematical proof of this? I have seen countless articles and exposes about the hidden debt. These are incredibly sophisticated companies so presumably they wouldn’t let themselves get into a company ending bind. But what are the chances this is actually an MBS type situation where the system is truly overloaded and a few sacrificial lambs are needed?
Has anyone seen a definitive mathematical proof of this? I have seen countless articles and exposes about the hidden debt. These are incredibly sophisticated companies so presumably they wouldn’t let themselves get into a company ending bind. But what are the chances this is actually an MBS type situation where the system is truly overloaded and a few sacrificial lambs are needed?
There's an old WSB saying: the market can remain irrational longer than you can remain solvent. The AI craze is that but on 'roids.
> These are incredibly sophisticated companies so presumably they wouldn’t let themselves get into a company ending bind.
The problem is, company C-levels don't care about the long term health of the company. They only think about next quarter (in a misguided interpretation of "shareholder duty/fiduciary duty") and their bonuses tied to their KPIs.
> But what are the chances this is actually an MBS type situation where the system is truly overloaded and a few sacrificial lambs are needed?
The system definitely is overloaded to hell and beyond after well over a decade of ZIRP. That money never got deflated out of the system in a healthy way and now everything is looking to fall apart.
Unfortunately, such events are already "priced in". VC essentially is built on 1 of 100 investments striking it big and 99 going bust. A market correction won't hurt the big guys, but it will definitely hurt all the small guys.
