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Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

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Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#241

Post by JohnFen »

DrScientist wrote: post #212
orwin wrote: post #207

Earlier quoted context omitted.

I borrow you 10 money i use to buy my chair-making tools. I make the chair, sell it 20 money, then pay you 12 money back for the service rendered. Basically money is supposed to be a tool that help us creating capital by exchanging goods.

But aren't you confusing the means of exchange with the creation of value. The creation of value is me taking energy from the sun and converting that into a chair. You lending me money is you extracting value from artificially being a middleman. It would have been more efficient to write an IOU to the tool maker, make the chair and pay back the tool maker directly. Now sure that IOU isn't that fungible - however that…

> The creation of value is me taking energy from the sun and converting that into a chair.

Which requires money to do. If you borrow that money to enable using solar to make furniture, then you can repay that money with interest and keep a profit for yourself. Both the borrower and lender come out with more money than they had when they started.

That's not a zero-sum game.

Now, it's 100% true that borrowing and lending can (and often is) done in a way to make it a zero-sum game, but that's just because the world (including the big-time corporate world, and especially including major IT companies) is full of scammers.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#242

Post by arcfour »

bmenrigh wrote: post #56
mNovak wrote: post #2

Archive link: https://archive.ph/20260720174223/https://asia.nikkei.com/bu...

I'm in the US and I'm either getting NXDOMAIN or NOERROR (with no A record answer) back from every big nameserver I try (my ISP, Google, Cloudflare, etc.). But a dig +trace archive.ph (which recurses all the way to the root locally) resolves it fine. Is there some US-mandated DNS filtering I don't know about?

No, the archive.today (and .ph, .is, etc.) operator configured their nameservers to return invalid responses to Cloudflare's 1.1.1.1 resolvers because Cloudflare doesn't forward EDNS client subnet info (for the privacy of their users). The operator claims to need this information for load-balancing but I don't buy that argument.

As far as I was aware, their issue was resolved, but sometimes I still see failures so I don't really know.

Also, "US-mandated DNS filtering" would be a violation of the 1A except in narrow circumstances (which don't exist here) so I'm not sure that that should be your first thought...

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#243

Post by xtiansimon »

gtowey wrote: post #233
xtiansimon wrote: post #204

Earlier quoted context omitted.

> “As someone who belongs to “all of us”, i vote to not bail us out if shit hits the fan.” You have alighted onto an interesting topic: “bail out”. I believe a closely related word on the semiotic chain is “retreat”. I don’t feel that our culture would wish to “retreat” from AI. I know quite a few managers and programmers who absolutely delight in the fruits of the industry. No doubt the titans of the AI industry, wh…

> You have alighted onto an interesting topic: “bail out”. I believe a closely related word on the semiotic chain is “retreat”. Huh? That's a different meaning of "bail out". In this context its meaning is closer to "rescue" and not retreat.

Literally a "bailout" is a "rescue", yes. Hmmm?

Let's call it a "figurative expression" then. You could say it would be a "retreat" to not bailout AI. A turn away. Run. For example if the investment in data centers using borrowed money is not paid back on-time, and the investments fail, and there is no bailout, resulting in a cascade of business failures, then the I would say we "retreated" from AI. Retreat from the Technology. Retreat from the Economics of AI services. Hoo-Haa!

For example, if crypto failed there might be a "retreat" as far as crypto is not a bedrock of the banking industry. But I'm probably wrong in my characterization of crypto. Whatever. Not like Crypto can be compared to Tulip Mania. Now there's a retreat.

https://en.wikipedia.org/wiki/Tulip_mania

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#244

Post by zamadatix »

ndsipa_pomu wrote: post #221
dizhn wrote: post #172

The whole world's wealth is being siphoned off by these companies. I hope the very probable crash does not happen.

What would be the alternative scenario to a crash? As I understand it, for AI companies to not crash, they have to end up putting us all out of jobs which will end up with us becoming slaves/serfs.

Why keep slaves or serfs if AI can do every job better.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#245

Post by DANmode »

laughing_man wrote: post #51
AznHisoka wrote: post #4

Earlier quoted context omitted.

As someone who belongs to “all of us”, i vote to not bail us out if shit hits the fan. No need to ask me when it happens, OK? No really, it’s nice of you but we really dont need to be bailed out. You are welcome :)

The problem is if large banks fail they take everyone else with them. We should have dealt with this in 2009, but for some reason it didn't happen. But money talks, I guess.

You should really define “everyone else”.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#246

Post by orwin »

DrScientist wrote: post #212
orwin wrote: post #207

Earlier quoted context omitted.

I borrow you 10 money i use to buy my chair-making tools. I make the chair, sell it 20 money, then pay you 12 money back for the service rendered. Basically money is supposed to be a tool that help us creating capital by exchanging goods.

But aren't you confusing the means of exchange with the creation of value. The creation of value is me taking energy from the sun and converting that into a chair. You lending me money is you extracting value from artificially being a middleman. It would have been more efficient to write an IOU to the tool maker, make the chair and pay back the tool maker directly. Now sure that IOU isn't that fungible - however that…

Originally, money is a IOU and basically a tool to trade between communities. The individualization of capital (capitalism basically) made place for private loan and artificial middlemen like i wrote in the previous comment. And yes, you can work without it, but this is the way things works in the west since the 18th century, 17th century in GB.

------------

To be clear about how banks work: they don't loan money, they create it via accounting. You go to a bank and ask for 20 money at 10% interest, they will write in their asset column "20 money" and in their liability "20 money", give you the newly created 20 money and create a "coupon" of 2 money (sorry that's the french word, i don't know how englo people call that). If needed (like a liquidity crunch), they can sell the coupon worth 2 money at 1 money, or even your loan worth 20 money 18 to another bank, but they will keep the liability in their own books. If the liability become higher than the assets, bankruptcy. Notice that the money you put in the bank isn't touched.

The money you put in bank, they invest in low risk assets like government bonds, through their investment funds. Since those are locked assets, if too many people want their money back at the same time, the bank enter a liquidity crunch, have to sell the locked assets at a discount, and put the losses on their own funds, in the "liability" column.

Wether it's caused by a credit crunch or because loans aren't being repaid, if a bank "liability" column has a higher value than its "assets" column, they enter bankruptcy. The state auctions customer-linked investment off (i think that's more complex and depends on the local laws, in my country you have a transfer provision where the customer and the bonds linked to some of his bank accounts are transfered to a new bank) where those are slowly sold at a higher value than the failing bank would have gotten, slowly reimbursing the customers. It is _very_ rare that bank customers loose any money in the long run (they do suffer opportunity cost though, their assets are locked and don't earn any interests, so in a way, they loose a little). in the 2007-2008 crisis, the issue is that banks split loans weirdly and did a lot of accounting shenaningans tying each international bank to each others.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#247

Post by JohnFen »

hparadiz wrote: post #176
rmunn wrote: post #125

Earlier quoted context omitted.

Huh? What exactly do you think I'm trying to "cope" with? That American AI companies are overleveraged and some of them are going to go bankrupt? I've been predicting that for months. Why do you think I would need to cope with the idea?

In reality just like every major market runup there's gonna be a consolidation of the industry and inevitably it will cause many companies to fail and critics will point to that and go "see it was a bubble!" while completely ignoring the several dozen new companies that will rise out of it. It's the 90s all over again.

> critics will point to that and go "see it was a bubble!" while completely ignoring the several dozen new companies that will rise out of it.

That several dozen new companies came out of it has nothing to do with whether or not it was a bubble. It was, and the effects of it popping were bad (including the effect that its popping led to consolidation). Nobody should want a repeat of that.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#248

Post by kbelder »

Lerc wrote: post #143
thin_carapace wrote: post #102

Earlier quoted context omitted.

[flagged]

I wrote that comment entirely by myself, on my phone while waiting for a souvlaki. Perhaps the things that you consider AI tells are simply a use of language from someone in country with a different education system. I can't really judge how I might personally benefit from the current direction because I am uncertain what that direction is, and indeed if it will be sustained. If you are trying to allege that I have s…

>I wrote that comment entirely by myself, on my phone while waiting for a souvlaki. Perhaps the things that you consider AI tells are simply a use of language from someone in country with a different education system.

Nah, your writing was perfectly fine and something a native speaker would write also. The poster is just seeing false tells.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#249

Post by JohnFen »

laughing_man wrote: post #113
dartharva wrote: post #37

Earlier quoted context omitted.

They'll bail them out with what money? US is already almost $40T in debt, how do you think the bond market would react if another $2T were abruptly added to it?

Here's the thing about debt, though: If your debt is denominated in your own sovereign currency, you can just print more when you run out of money.

Which doesn't get you more wealth. It just makes the currency worth less.

Re: Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

#250

Post by StanislavPetrov »

lemax wrote: post #134
darth_avocado wrote: post #3

Well technically they don’t own the debt, the SPVs that own the data centers do. The giants just have long term commitments, but if shit hits the fan, it’s not the tech giants but the banks that lent the money to the SPVs that are at risk. This usually means all of us are on the hook.

These are relatively contained private credit markets though. We’re not looking at anything 2009 level. For scale, total US mortgage debt peaked at $9.3T ahead of the subprime mortgage crisis, 73% of GDP at the time. We’re talking here about ~5% of GDP.

We were around ~$11 trillion in debt in 2009. Now we are ~$40 trillion in debt. The FED balance sheet was less than $1 trillion before the crisis in 2008, now it is around ~$7 trillion. Our debt to GDP ratio was ~64% in 2008 and is now at ~120%. Put simply, our ability to absorb any sort of financial shock by taking on massive amounts of (more) debt (which is what we did in 2008) is not remotely similar to what it was during the last crisis. This would be true even if we weren't in the midst of a highly inflationary environment due largely, but not solely, to the ongoing energy crisis being worsened by the wars in Iran and Ukraine.

https://fred.stlouisfed.org/series/WALCL

https://fred.stlouisfed.org/series/GFDEGDQ188S

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