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Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

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Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#21

Post by JumpCrisscross »

hungryhobbit wrote: post #14
timmg wrote: post #8

The way I've been thinking about it: there is too much money trying to pour into the market. That's why valuations are so high. Maybe getting more of these big private companies public will bring valuations down a bit. (Just my impression. No math or financial studies behind it :)

No, the crash (that we all know is coming) will do that. Until then, history teaches that we'll just keep going up and up

> the crash (that we all know is coming) will do that. Until then, history teaches that we'll just keep going up and up

Stock prices don't have to crash. They can just stagnate while profits catch up and multiples compress.

Debt binges, on the other hand, tend to go bust with a bang. But after the recent private-credit scare, the AI build-out has been predominantly financed with stock. (I think.)

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#22

Post by Avicebron »

aurareturn wrote: post #18
rconti wrote: post #2

So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.

I don't think OpenAI or Anthropic are predicting that the AI market is going to collapse. In fact, I think both are bullish that the public still isn't pricing in exponential growth. I think what is happening is that OpenAI is racing to IPO before Anthropic because their growth isn't as impressive. If you are the weaker company, you should IPO first to lock up the cash.

What are they offering the public (not me and you writing code in our free time)?

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#23

Post by JumpCrisscross »

jmyeet wrote: post #17

So what people seem to be unaware of or are purposely ignoring is that OpenAI and Anthropic have invested trillions in a rapdily depreciating asset. There was a HN post from a day or two ago where someone bought a V100 for 150 pounds and connected it to their computer. Well that was a $10k GPU in 2017. That's the fate of H100/B100 GPUs in 5-10 years (and I suspect closer to 5). What do you do if you've invested $1 tr…

> What do you do if you've invested $1 trillion that will be worth $100 billion or less in 5 years?

I think the aim would be to generate at least $900bn of cash flow from those assets.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#24

Post by philipallstar »

JumpCrisscross wrote: post #12
timmg wrote: post #8

The way I've been thinking about it: there is too much money trying to pour into the market. That's why valuations are so high. Maybe getting more of these big private companies public will bring valuations down a bit. (Just my impression. No math or financial studies behind it :)

> there is too much money trying to pour into the market Keep in mind that inflation ran over 7% annualized in April [1]. [1] https://www.bls.gov/news.release/cpi.nr0.htm

Inflation is a measure of the cost of living. It's not got loads to do with large-scale, institutional investments.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#25

Post by SecretDreams »

JumpCrisscross wrote: post #10
SecretDreams wrote: post #7

Earlier quoted context omitted.

The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO. Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.

> The company. Worse for the investors It's worse for the new investors. (If it crashes.) It's great for the old investors. They got an opportunity to sell if they wanted. If they didn't, they still own their shares, except in a company that has that IPO cash sitting in its account.

Yes, correct. Although, even for some company folks, if it crashes, they get burned since they typically have blackouts post IPO.

Of course, some special souls are excluded from blackouts lol.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#26

Post by JumpCrisscross »

hungryhobbit wrote: post #19
paulpauper wrote: post #13

Earlier quoted context omitted.

People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023. When was the last time since 2009 there was a $500+ billion tech valuation that lost 90% or more? After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.

Read history: people always think everything is fine ... until it isn't.

> people always think everything is fine ... until it isn't

History is also replete with people constantly predicting collapses that don't come. Timing the market is very hard with numbers, it's total nonsense if one is just going off vibes.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#27

Post by Rekindle8090 »

jmyeet wrote: post #17

So what people seem to be unaware of or are purposely ignoring is that OpenAI and Anthropic have invested trillions in a rapdily depreciating asset. There was a HN post from a day or two ago where someone bought a V100 for 150 pounds and connected it to their computer. Well that was a $10k GPU in 2017. That's the fate of H100/B100 GPUs in 5-10 years (and I suspect closer to 5). What do you do if you've invested $1 tr…

[dead]

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#28

Post by aurareturn »

Avicebron wrote: post #22
aurareturn wrote: post #18

Earlier quoted context omitted.

I don't think OpenAI or Anthropic are predicting that the AI market is going to collapse. In fact, I think both are bullish that the public still isn't pricing in exponential growth. I think what is happening is that OpenAI is racing to IPO before Anthropic because their growth isn't as impressive. If you are the weaker company, you should IPO first to lock up the cash.

What are they offering the public (not me and you writing code in our free time)?

They are offering the public an opportunity to become shareholders and they are giving their investors and employees liquidity.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#29

Post by 9question1 »

philipallstar wrote: post #24
JumpCrisscross wrote: post #12

Earlier quoted context omitted.

> there is too much money trying to pour into the market Keep in mind that inflation ran over 7% annualized in April [1]. [1] https://www.bls.gov/news.release/cpi.nr0.htm

Inflation is a measure of the cost of living. It's not got loads to do with large-scale, institutional investments.

That depends. Inflation is a measure of the cost of living in terms of currency. It can be high either if goods and services required for living become scarce, or if currency supply increases. Currency supply increasing does affect asset prices.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#30

Post by aurareturn »

hungryhobbit wrote: post #19
paulpauper wrote: post #13

Earlier quoted context omitted.

People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023. When was the last time since 2009 there was a $500+ billion tech valuation that lost 90% or more? After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.

Read history: people always think everything is fine ... until it isn't.

Nasdaq is 5.4x higher now than peak dotcom.

So just buy the dip if it actually crashes.

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