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Nvidia is the central bank of AI

economist.com

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Re: Nvidia is the central bank of AI

#81

Post by soulofmischief »

JohnMakin wrote: post #67
Waterluvian wrote: post #31

Earlier quoted context omitted.

Maybe this is silly of me, but maybe gaming would enjoy an era of hardware upgrades being rather unviable so the focus turns to optimization and aesthetic.

It’s not silly. games use far more hardware than they really need. It also pushes out release dates of aggressive console schedules like ps6 because even if it’s a massive upgrade and you have IP locked into your console, no one is going to pay $4000 to play a game like wolverine.

We wouldn't be here today if the video game industry hadn't continued pushing the envelope for decades.

Re: Nvidia is the central bank of AI

#83

Post by cyberpunk »

manlymuppet wrote: post #74
sailfast wrote: post #57

Earlier quoted context omitted.

It would also follow that by increasing the money supply significantly they’re also contributing to inflation a great deal correct? (Given the rest of the economy is not growing at near the same rate as the AI industry)

Maybe a dumb question but how is NVIDIA increasing the total supply of money? Only the fed can actually order more money to be "created". Private companies can only work within the existing supply, that is, their reserves, no?

NV gives out a $100 to Party A, who puts it in their bank.

Bank takes $90 of that deposit (assuming 10% fractional reserve rule, no idea what the actual number is), and loans it out to party B, who pays it into either the same or another bank. Same rules apply -- except now it's down to $81 being loaned out, and so on and so forth, until that 100$ generated $1000 in total bank deposits.

edit: of course, it's never actually directly like this, a lot of other factors are involved, maybe the money is spent, maybe no one wants to borrow it, etc etc -- so it's more complicated but that's I think what they mean

Re: Nvidia is the central bank of AI

#84

Post by idontwantthis »

manlymuppet wrote: post #74
sailfast wrote: post #57

Earlier quoted context omitted.

It would also follow that by increasing the money supply significantly they’re also contributing to inflation a great deal correct? (Given the rest of the economy is not growing at near the same rate as the AI industry)

Maybe a dumb question but how is NVIDIA increasing the total supply of money? Only the fed can actually order more money to be "created". Private companies can only work within the existing supply, that is, their reserves, no?

Private banks increase money supply by lending. If 10 people deposit $1000 in a bank, it can loan $9000 to an 11th person. Now the economy has $19000 total.

Re: Nvidia is the central bank of AI

#85

Post by Ecco »

thrownawaysz wrote: post #13

I wonder when they will give up on the gaming market because that could take down several publishers and developers. I really don't think it's an if question but a when because it almost feels like an afterthought at this point (they removed the standalone gaming revenue report from the financial reports this summer). Also I don't think AMD and Intel is capable "to step in" to replace them.

Question: wouldn’t the fab be the actual bottleneck? In other words, why wouldn’t TSMC make more NVIDIA chips instead of AMD ones? I assume they’ll just do whichever is paying more, so if NVIDIA chips are better, gamers would be willing to pay more for them and in turn TSMC will be willing to make more of them?

Re: Nvidia is the central bank of AI

#86

Post by arcanemachiner »

manlymuppet wrote: post #74
sailfast wrote: post #57

Earlier quoted context omitted.

It would also follow that by increasing the money supply significantly they’re also contributing to inflation a great deal correct? (Given the rest of the economy is not growing at near the same rate as the AI industry)

Maybe a dumb question but how is NVIDIA increasing the total supply of money? Only the fed can actually order more money to be "created". Private companies can only work within the existing supply, that is, their reserves, no?

Banks create money when issuing a loan. This is how fractional reserve banking works. They lend money they don't have (most of). This is institutionalized fraud, and it's been standard operating procedure for centuries.

Re: Nvidia is the central bank of AI

#87

Post by conmod278 »

arcanemachiner wrote: post #86
manlymuppet wrote: post #74

Earlier quoted context omitted.

Maybe a dumb question but how is NVIDIA increasing the total supply of money? Only the fed can actually order more money to be "created". Private companies can only work within the existing supply, that is, their reserves, no?

Banks create money when issuing a loan. This is how fractional reserve banking works. They lend money they don't have (most of). This is institutionalized fraud, and it's been standard operating procedure for centuries.

But the fraction to be kept in reserve has been zero for 4-5 years.

Re: Nvidia is the central bank of AI

#88

Post by jrmg »

JumpCrisscross wrote: post #49

> worth around $5.4trn Note that the Fed has a $6.7tn balance sheet [1]. (This is a silly comparison. But still fun.) The real comparison: Nvidia's $500+ billion of investments and commitments [2] is substantially more than any easing the Fed has done in the same time [3]. Monetarily, Nvidia is creating a lot of money in our economy. The good news: I have seen no evidence Nvidia has borrowed against its stock or othe…

Its stock could crash without causing–as long as its cash flows continue–a credit crisis through its investments and commitments

Uh, that’s a pretty load-bearing as long as its cash flows continue. The two things are surely correlated.

Re: Nvidia is the central bank of AI

#89

Post by esikich »

idontwantthis wrote: post #84
manlymuppet wrote: post #74

Earlier quoted context omitted.

Maybe a dumb question but how is NVIDIA increasing the total supply of money? Only the fed can actually order more money to be "created". Private companies can only work within the existing supply, that is, their reserves, no?

Private banks increase money supply by lending. If 10 people deposit $1000 in a bank, it can loan $9000 to an 11th person. Now the economy has $19000 total.

The $9000 has to be paid back, and then some. I sure hope you aren't an accountant.

Re: Nvidia is the central bank of AI

#90

Post by caaqil »

lumost wrote: post #35
caaqil wrote: post #26

Earlier quoted context omitted.

[flagged]

While I dislike this take, when the dust settles we will have compute clusters orders of magnitude larger than anything that existed in 2023. If demand vanishes for the 3 million cards Amazon just bought, then something will be done with them. The AI market may end up in a bizarre jepson's paradox of rotation between inference use cases and model training.

The OP I was replying to edited the comment, so I wasn't even considering that scenario. The original comment I replied to was about islamic banking comparison (up to the Wikipedia article link), dude added the scenario after my comment.
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