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Debeers ass market

The billionaire cult is trying to brute force super intelligence at any cost.

Getting a bulk discount for pallets of GPUs, warehousing em for a few years to drive up demand and then selling them to increasingly desperate gamers? Now that's just sound business strategy if you ask me. This is legal financial advice.

That's good to hear since computer hardware is like wine and only gets better with age... Right?

Are we sure they aren't flowing into china? Because I'm starting to think they are.

See also "inventory loading" aka "garage qualification" in MLMs. The idea that these giant firms are acting like LuLaRoe or AdvoCare is ... both disturbing and at least a little humorous.

Microsoft should, as one of the single best-capitalized and most-experienced data center developers, be thriving. Yet based on information from sources and my analysis, it likely has between $50bn and $100bn in warehoused GPUs and AI-related IT equipment www.wheresyoured.at/wherere-all-...

Meanwhile boring old Azure consumers can't get any capacity for boring old compute that runs their entire business.

Not necessarily. If the chips can still be used in lower use tasks, like inference, even if those chips can only work at a small fraction of their original throughput, they'll still be on the legal depreciation schedule.

Tulip bulbs, on the other hand, are very easy to plant and require only water and sunlight to grow. Would you consider investing in my tulip business, Ed?

Ed talks about the dark fiber comparison all the time and AI infra buildout isn't that for a number of reasons, principle among which is that there is no forthcoming growth ramp, there's no internet-like future for gigantic ultra expensive LLMs after this bubble pops

Good to have someone agrees with me on that. I've been saying this since this craziness began and every 6 mos Nvidia has a new version lol.

Very difficult because these ones are directly integrated into massive server racks, they were built from the start to run "AI" not for normal computing.

hope they all go bankrupt

Buy your Model T now and be ready to drive it on the new Interstate highway system when it's built.

I think about this in the context of all those loans being collateralized by the chips; those don’t get done if the assets aren’t insured. Are those sitting in the builders risk placements? With NVIDIA? Really wonder if London is noticing like $100B of limits stacking on a random warehouse in Asia

So, I’m just skimming AI news, but I wonder if the current call for the feds to intervene with a “slowdown” is motivated by the fear of each company collapsing due to this extreme over-extension? Or are we talking about two distinct things?

I guess it's a bit of a technicality given that the GPUs are presumably paid for & on the books, but - are these actually physically warehoused by Microsoft & co, or are these future production/delivery contracts?

$ value

Are they sitting in warehouses, or are they still to be manufactured? A lot of AI stuff seems to be people announcing things that don't exist, at least not yet.

This week’s earning calls are a pivotal moment - is the deluge of AI slop really worth the mountain of debt? And why should investors keep pumping in more money to inflate the bubble?

I wonder how much hardware from nVidia and others are just paper. How much of this can be no actual physical equipment being delivered, just balance sheet pumping?

www.manchestereveningnews.co.uk/news/world-n...

This is part of why NVIDIA is pushing the idea of compute as an asset class -- you can extend the depreciation schedules of the GPUs even if they're not cutting edge performance, you can borrow against the compute you own even if it's not deployed, and you can keep buying as much as they can make.

sitting in warehouses, you say?

Not saying I fully agree with you, but your insights are brave and well supported. Always a pleasure to listen to you. Thanks, Ed.