To me it seems likely there's an overshoot of sorts.
Gigantic sums of money are bet on a quasi-perfect future in which AI is the great new revenue-mover. Indications it isn't or of lacking real productivity would come late in the process, leaving aside any other effects to the economy like worker displacement (this is a whole other topic that bears thinking about).
Pair that with potential non-viable capacity like: where's all that energy coming from, even - and it might be overshooting right now (as it did in dot-com for routers and cables infrastructure - great to have it but it was overshot).
I know it's hard to be right now against the tide of optimism and seeing blow-offs like MU / SK Hynix - but it definitely rings some overinvestment bells.
Michael Cembalist at jpm calling openAI as the weak link as well based on lack of clear monetisation route (vs google / AWS) and constraints on compute builds from power.
Interesting. Thanks!
Oracle / softbank cds / arm equity tracker installed……
Softbank is really the key.... Thats where the money is coming from....
Is Softbank gonna fall hard if this gamble turns out badly? 😉
Well really depends if you think ARM and OpenAI could fall a long way....
To me it seems likely there's an overshoot of sorts.
Gigantic sums of money are bet on a quasi-perfect future in which AI is the great new revenue-mover. Indications it isn't or of lacking real productivity would come late in the process, leaving aside any other effects to the economy like worker displacement (this is a whole other topic that bears thinking about).
Pair that with potential non-viable capacity like: where's all that energy coming from, even - and it might be overshooting right now (as it did in dot-com for routers and cables infrastructure - great to have it but it was overshot).
I know it's hard to be right now against the tide of optimism and seeing blow-offs like MU / SK Hynix - but it definitely rings some overinvestment bells.
Michael Cembalist at jpm calling openAI as the weak link as well based on lack of clear monetisation route (vs google / AWS) and constraints on compute builds from power.
Yes - its hard to see how OpenAI get the money they need... all their main partners are showing some degree of financial stress....