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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

#211

Post by InsideOutSanta »

spott wrote: post #113
master_crab wrote: post #95

Earlier quoted context omitted.

“as long as it’s cash flow continues” is doing a lot of optimistic heavy lifting. The whole premise of the circular financing worry is that Nvidia sits in the middle of all the guarantees made to companies like OpenAI. If any of those companies become insolvent, Nvidia is on the hook for it. Also Nvidia isn’t really creating money. The 500B number is third party capital that already exists (BX, Apollo, etc).

Yea, but they would have to become insolvent in a way that makes compute lose value. The reason Nvidia is comfortable making these deals is because if OpenAI can’t use the compute, someone else can. Granted OpenAI going insolvent likely means a drop in the value of compute…

> if OpenAI can’t use the compute, someone else can.

The problem with that is that OpenAI can only afford to pay for the compute because they are burning investor money (and so are most of OpenAI's biggest clients). They are losing billions. If they stop burning money, nobody else will be there to pay for that compute at OpenAI's cost.

Sure, somebody will probably be able to use these GPUs, they just won't be able to pay nearly as much for them as OpenAI does.

In reality, it's just nowhere near worth as much as OpenAI pays for it. Inflating the cost of compute is part of the problem caused by the circular financing, and if (or maybe when) OpenAI goes, the price of compute will go with them.

Re: Nvidia is the central bank of AI

#212

Post by InsideOutSanta »

indigodaddy wrote: post #178
SleightOfHand wrote: post #149

Earlier quoted context omitted.

You're not considering video which OpenAI opted out of when they retired Sora. Generative video requires significantly more computing power and energy than generative text. OpenAI is fucked, compute is still needed, it's just them that isn't.

oAI isn't anywhere near close to fucked as long as their models are head and shoulders above even the very best open models in terms of tool calling and rock solid stability/reliability for agents/coding harnesses. Which, they are right now and we'll see if open models actually catch up in that regard. Even the "best" open models pale in comparison with tool calling and general "prompt and go do something else for an…

>oAI isn't anywhere near close to fucked as long as their models are head and shoulders above even the very best open models in terms of tool calling and rock solid stability/reliability for agents/coding harnesses

That's already not the case today. If you sat me in front of an LLM and told me to figure out if I'm working with K3 or Astra, I could probably do it, but it would take some work to be certain.

Re: Nvidia is the central bank of AI

#213

Post by kridsdale1 »

SV_BubbleTime wrote: post #209
fragmede wrote: post #197

Earlier quoted context omitted.

Cryptocurrency mining had it broken before that. PC gaming's golden years are behind us, as AI, even if not LLMs, seems like it's not going away, so the gaming market is now the niche hobby while AI takes center stage. RIP. My first gaming ~GPU~ (we called them 3d accelerators back then) was a Diamond Monster II with a 3dfx Voodoo 2 chip.

> Diamond Monster II with a 3dfx Voodoo 2 chip Oh shit, I had file deleted that. I remember now. I think I used that with the first N64 emulator, I think Project something to play Turok the first person dinosaur hunter game. Life before the internet was better I think.

The Glide API was the only hardware acceleration in there for a good while before it got OpenGL. I remember using a third party wrapper or something to make it work on whatever it was I had in 1999.

Re: Nvidia is the central bank of AI

#214

Post by fasterik »

awesomeMilou wrote: post #133
manlymuppet wrote: post #69

I've always found it interesting when corporations start acting like public institutions. When traditionally philosophical, social contract ideas apply to things like corporate governance. Or like here, where private structures get powerful and important enough to resemble government structures. The ideas we deal with when we discuss society and organization aren't exclusive to government, they relate to human nature…

Yeah its soooo interesting! Totally not dystopian, just soooo interesting and fascinating to ponder these scenarios in which corporations hold equal power to national governments! Just such a curious scenario to let your mind wander about, how society would look like in these scenarios! /s I'm honestly so sick of the suspense of disbelief on this site, how is this more "interesting" to you, than the absolute sheer te…

You're catastrophizing and misreading the original comment in an uncharitable way.

Re: Nvidia is the central bank of AI

#215

Post by InsideOutSanta »

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?

> Only the fed can actually order more money to be "created".

If you go to a bank and get a loan, that is literally money that did not exist before you got a loan. People think that you are borrowing money that somebody else put in the bank, but that's not true. Banks can lend out a lot more money than people put into them.

Re: Nvidia is the central bank of AI

#216

Post by Kiro »

SleightOfHand wrote: post #148
spott wrote: post #113

Earlier quoted context omitted.

Yea, but they would have to become insolvent in a way that makes compute lose value. The reason Nvidia is comfortable making these deals is because if OpenAI can’t use the compute, someone else can. Granted OpenAI going insolvent likely means a drop in the value of compute…

> if OpenAI can’t use the compute, someone else can This is the big point IMO since I have never given $1 to OpenAI but I subscribe to Vidu and Typecast, and have given money to Kling, Hailou, and even Gemini in the form of Google Workspace. So these other guys have products and use cases, which OpenAI has never been able to crack beyond ChatGPT. And ChatGPT was never worth paying for, IMO. If OpenAI dies, it's not b…

I've paid more money to OpenAI than I've spent on all other products I pay for combined the past 5 years.

Re: Nvidia is the central bank of AI

#218

Post by LastTrain »

jonplackett wrote: post #168

Weird to think we are currently living in the ‘unlimited free Ubers because you recommended a friend or 2’ phase of this new technology. Imagine if running fable costs you what it actually costs to run fable. A lot of vibe coders (and just proper software engineers) are gonna be very sad if that comes to pass.

This is what I’m not getting - we’re spending more than the global gross sales of all software on the planet on AI, how much more software needs to be sold and for how much more to recoup?

Re: Nvidia is the central bank of AI

#219

Post by williamse »

indigodaddy wrote: post #178
SleightOfHand wrote: post #149

Earlier quoted context omitted.

You're not considering video which OpenAI opted out of when they retired Sora. Generative video requires significantly more computing power and energy than generative text. OpenAI is fucked, compute is still needed, it's just them that isn't.

oAI isn't anywhere near close to fucked as long as their models are head and shoulders above even the very best open models in terms of tool calling and rock solid stability/reliability for agents/coding harnesses. Which, they are right now and we'll see if open models actually catch up in that regard. Even the "best" open models pale in comparison with tool calling and general "prompt and go do something else for an…

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