Brian
bwnash.bsky.social
Brian
@bwnash.bsky.social
730 followers 340 following 3K posts
Hiking, fitness, cooking, Japanese metal, and Braves baseball. DevOps in finance by trade.
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Man, those murder mitts...
"Oh, we didn't lose it. We know exactly where it is."
If I were them, I simply wouldn't make $1.3 trillion in spending commitments that I can't conceivably fulfill.

Do I have to think of everything around here?
They want most of the proles dead, and the remainder enslaved. It's that simple.
The talking point that 'CapEx is funded from hyperscalers' cashflow' died last week.

Now we get an object lesson in the sunk cost fallacy.
Bessent doing QE cowboy style, since the Fed won't make him look solvent any more.
CRWV seems to me, on paper, la dead company walking. Insane debt levels for someone losing that much money.

You can no longer discount the idea that Trump might step in to rescue one of his sycophants.

I do think Deutsche is right, data centers/financing are the weakest link in the AI chain.
I know PIMCO is on the hook for a ton of these, but it's spread thinly over their dozens of high-yield bond funds.

I see ORCL as the most vulnerable of the hyperscalers. I don't see any way OpenAI pays them the $300b they agreed to.

Now, it even looks like OpenAI is angling for a backstop.
Tough one. So much of the debt is issued by private credit, snd the only private credit company I know of is OWL. AFAIK, they don't hold the debt on their books, it's sold primarily to university endowments and insurers stretching for yield and doing duration matching.
They've put export controls on vibranium, which is critical to US military military and technology applications.
Notice the two countries in need if more Democracy - Venezuela and Nigeria - both have significant oil reserves.
The talking point that hyperscalers are paying for CapEx out of cashflow died last week, and here they are, already angling for a government bailout/backstop.

Did they ever think of simply not committing to making over a $trillion in spending commitments in the next 3 years?
Obviously aware that the debt levels are a major concern, now that hyperscalers are no longer funding CapEx from cashflow.
Hope it's on streaming.
Is it really the case that techbros consider Sam to be incredibly charismatic and visionary, while the rest of the world sees him as a transparently sociopathic grifter who sounds like an fabulist high school stoner when he gets an inch outside his wheelhouse?
Yeah, well, China played it smart and didn't try to build AGI, just models that are factual, helpful, and can run easily on a single export-limited GPU cluster.
This asshole... after all his assholery.
Yeah, this specific pullback seems to be about the death of the narrative that hyperscalers are paying for CapEx out of cashflows.

Now we get an object lesson in the sunk cost fallacy, absent the emergence of a killer app.
It would help their cause if they had an answer to the question: "How does OpenAI pay for the $1.3 trillion in spending and infrastructure commitments it's already made?" with an answer beyond Sam's, "Just SELL your shares, Brad, better yet, go short so I can crush you."
All I can say is, Katyal was really sharp and completely prepped.

Only question is whether the Supreme Religious Council is going to go against their god-king.
Even though I'm not their target demographic (yet, at least), shit like this means I never leave the house without 4 kinds of death concealed about my person.
Also, Karp came across as absolutely bugfuck nuts yesterday on CNBC. Sounded completely coked out, over some kind of unmedicated personality disorder.

Are all these valley guys like that?
Burry is washed, that's not it. My take is, hyperscalers "funding CapEx from cashflow" trope died last week. META: $57b in IG debt this quarter and $150b off-balance sheet. Oracle $18b, and getting in real trouble. GOOGL $10b, CRWV, $3.2b last month.

Getting an object lesson in sunk cost fallacy.
Object lesson in the sunk cost fallacy coming up.