Earlier quoted context omitted.
I didn’t flag it, but it looks like accounting nonsense. These advance commitments probably aren’t assets on the books and there is likely no debt between OpenAI and its vendors. So at most, it’s a stock market bubble. If OpenAI doesn’t pay, its vendors have whatever data centers that they’ve built so far and can use them themselves or rent them to someone else.
I think the main point is in the closing of the article; that valuations of companies are driven up by OpenAI spent commitments, and that those companies combined now would represent 40% of S&P 500. You’re right, this is not accounting debt. I don’t think OpenAI’s spending commitments alone are the problem, but OpenAI imploding will have a cascading effect and a realization check for everyone in the industry. What ar…
But apparently there are ways to keep the debt used to build data centers off the books? What happens if the data centers are no longer needed? I can't tell if that's an accounting fiction (the tech company has to buy the data centers anyway) or if the tech company can say "never mind, I don't need any more datacenters" and bondholders lose their money.