Your article make sense. You advice to invest in power generation — even I can understand that. But which firms do you suggest?? Neophytes need to know…
So, we know you are a cynic… so am I. But you could answer your own question now… I could be cynical and answer my own question, and I don’t get paid to wait….
Criminal, corrupt and almost pathologically fraudulent defines such behaviour, in the past they use to call it “kiting” and I can recall many a corporate exec, director, business owner here in N.Z in the 80’s being prosecuted for such post business collapse… it’s no different to what these techies are doing albeit with more zeros tagged the end of the initial digit and being slightly more sophisticate in hiding the source of the initial funding mechanism.
Bet they think they are clever dicks, in their win/win, manipulating stock values, keeping Trump happy, a guy fixated on the Stock market results, who I guess is happy to go along with this sham provided he’s not in any compromised and partakes, Crypto anyone, great payday if you can get it, enabled undoubtedly by the same tech … only to willing to trade know how, access resulting the crumbs that fall from their table to BIC, bloviator in chief, comparative the tens if not hundreds of billions in nett worth added to theirs, those involved in this scams… personal wealth ..
Yep, sure as shit, the U.S is the bastion of capitalism alright, more akin a criminal syndicate… and they persecuted and prosecuted the mafia… all I can say to that is how bigoted, churlish and petty… in contrast to this activity, legitimised in what by every metrical which in most jurisdictions would be considered a criminal enterprise… a cartel conspiracy… take your pick, there is so much to choose from.
Its behaviour that is so wrong on so many levels, and yep, when it goes tits up and it will, the tax payer will foot the bill, just another added to be met taxpayers in a long line, Wall Street, Banks, GSIBS. ,
I guess now’s not the time to talk about what taxpayers ought pay for…. Medicare for all, Free Education, Social Housing, ensuring Vets don’t fight another war just to receive entitlements enshrined in law, what about a better state and national infrastructure… 😂😂😂😂😂, oops forgot, 🐷 porky p will fly before that happens, don’t be daft, that commie/socialist talk will get you thrown out of polite society… didn’t you know nor understand, the U.S as stated, is the bastion of capitalism…. as if… it makes you want to puke…just saying
AI valuations are stretched and capex is insane. Everyone from Goldman to Bridgewater has already said that. But jumping from “valuations are high” to “this is all circular financing and taxpayers will bail it out” without evidence is wild. If this were just a money-go-round, we wouldn’t see legit constraints like GPU shortages and data center energy crises. Physical bottlenecks don’t simultaneously come from accounting tricks.
And the idea that the government will inevitably rescue overvalued tech is historically false. The dot-com crash wiped out trillions and DC didn’t rush in. Amazon fell like 90%+ during this time.
Overt risks to the financial system get bailouts (eg 08-09 did because it threatened the actual plumbing). AI is now is more of an investor risk (eg wouldn’t break the repo market).
Thanks for sharing your thoughts — but I think we’re talking past each other a bit.
I’m not saying AI demand is fake. The GPU crunch, the power bottlenecks, the data-center buildout — all of that is real. Tech isn’t the issue.
My point is about how this whole thing is being financed and the incentives that creates.
Right now we’ve got sky-high valuations, capex growing way faster than revenues, and a lot of the same money cycling between the same players. Then add the fact that Washington now talks about AI as national-security critical — and that alone changes how companies behave.
That’s where the bubble risk comes from.
And on your bailout point — you’re right, the dot-com names didn’t get bailed out. But they also weren’t:
**positioned as a national-security priority,
**a meaningful driver of GDP growth, or
**wrapped up in “we can’t fall behind China” messaging.
In other words, the political incentives were totally different back then. Pets.com wasn’t “critical infrastructure.”
That’s why I think the moral hazard is stronger today. When companies start believing they’re too strategically important to be allowed to fail, they naturally take bigger swings. You don’t need fake demand for a bubble — just distorted incentives.
So yeah, AI is real. But the way it’s being funded and framed right now is exactly how you get a bubble sitting on top of a real technology boom. That’s the distinction I’m making.
Hi there, your answer misses the point. It is a fact, that this circle financing is all over in place. And it does create real stuff like data centers using GPUs, of course. That is what he is saying. There is a real technology, but financed with odd methods, creating a valuation bubble. And in difference to the dot com crash this technology now is considered as a very important strategic factor in the US vs China game. So all in all his conclusions do make sense to me.
Circular financing is being used in this piece to imply a sort of shell game, which as I pointed out doesn't apply here. There are also record-level semiconductor buildouts, further proving this point. Physical constraints as a result - indicating actual demand, not financial tricks. Circular financing isn't by itself a negative, but is being implied here as a conspiracy shell game to pad pockets and bottom lines.
Furthermore, this type of financing isn't 'odd,' it's common capex circularity used across industries. The level is intense, but not directly threatening to the system as subprime mortgages were - that's one of my main points here.
The tech scene in 2000 was a very strategic factor not just for the US, but the world too. Hence why it rippled out so far.
Your article make sense. You advice to invest in power generation — even I can understand that. But which firms do you suggest?? Neophytes need to know…
it makes sense the the money goes to these companies. good to call it out.
So, we know you are a cynic… so am I. But you could answer your own question now… I could be cynical and answer my own question, and I don’t get paid to wait….
SpaceXcess is the model. For the money, all blow and no go.
Criminal, corrupt and almost pathologically fraudulent defines such behaviour, in the past they use to call it “kiting” and I can recall many a corporate exec, director, business owner here in N.Z in the 80’s being prosecuted for such post business collapse… it’s no different to what these techies are doing albeit with more zeros tagged the end of the initial digit and being slightly more sophisticate in hiding the source of the initial funding mechanism.
Bet they think they are clever dicks, in their win/win, manipulating stock values, keeping Trump happy, a guy fixated on the Stock market results, who I guess is happy to go along with this sham provided he’s not in any compromised and partakes, Crypto anyone, great payday if you can get it, enabled undoubtedly by the same tech … only to willing to trade know how, access resulting the crumbs that fall from their table to BIC, bloviator in chief, comparative the tens if not hundreds of billions in nett worth added to theirs, those involved in this scams… personal wealth ..
Yep, sure as shit, the U.S is the bastion of capitalism alright, more akin a criminal syndicate… and they persecuted and prosecuted the mafia… all I can say to that is how bigoted, churlish and petty… in contrast to this activity, legitimised in what by every metrical which in most jurisdictions would be considered a criminal enterprise… a cartel conspiracy… take your pick, there is so much to choose from.
Its behaviour that is so wrong on so many levels, and yep, when it goes tits up and it will, the tax payer will foot the bill, just another added to be met taxpayers in a long line, Wall Street, Banks, GSIBS. ,
I guess now’s not the time to talk about what taxpayers ought pay for…. Medicare for all, Free Education, Social Housing, ensuring Vets don’t fight another war just to receive entitlements enshrined in law, what about a better state and national infrastructure… 😂😂😂😂😂, oops forgot, 🐷 porky p will fly before that happens, don’t be daft, that commie/socialist talk will get you thrown out of polite society… didn’t you know nor understand, the U.S as stated, is the bastion of capitalism…. as if… it makes you want to puke…just saying
Kia Kaha (stay strong) from New Zealand
Mix of real concerns with lazy conclusions here.
AI valuations are stretched and capex is insane. Everyone from Goldman to Bridgewater has already said that. But jumping from “valuations are high” to “this is all circular financing and taxpayers will bail it out” without evidence is wild. If this were just a money-go-round, we wouldn’t see legit constraints like GPU shortages and data center energy crises. Physical bottlenecks don’t simultaneously come from accounting tricks.
And the idea that the government will inevitably rescue overvalued tech is historically false. The dot-com crash wiped out trillions and DC didn’t rush in. Amazon fell like 90%+ during this time.
Overt risks to the financial system get bailouts (eg 08-09 did because it threatened the actual plumbing). AI is now is more of an investor risk (eg wouldn’t break the repo market).
Thanks for sharing your thoughts — but I think we’re talking past each other a bit.
I’m not saying AI demand is fake. The GPU crunch, the power bottlenecks, the data-center buildout — all of that is real. Tech isn’t the issue.
My point is about how this whole thing is being financed and the incentives that creates.
Right now we’ve got sky-high valuations, capex growing way faster than revenues, and a lot of the same money cycling between the same players. Then add the fact that Washington now talks about AI as national-security critical — and that alone changes how companies behave.
That’s where the bubble risk comes from.
And on your bailout point — you’re right, the dot-com names didn’t get bailed out. But they also weren’t:
**positioned as a national-security priority,
**a meaningful driver of GDP growth, or
**wrapped up in “we can’t fall behind China” messaging.
In other words, the political incentives were totally different back then. Pets.com wasn’t “critical infrastructure.”
That’s why I think the moral hazard is stronger today. When companies start believing they’re too strategically important to be allowed to fail, they naturally take bigger swings. You don’t need fake demand for a bubble — just distorted incentives.
So yeah, AI is real. But the way it’s being funded and framed right now is exactly how you get a bubble sitting on top of a real technology boom. That’s the distinction I’m making.
I pray that the "no one " is too big to fail has passed
Hi there, your answer misses the point. It is a fact, that this circle financing is all over in place. And it does create real stuff like data centers using GPUs, of course. That is what he is saying. There is a real technology, but financed with odd methods, creating a valuation bubble. And in difference to the dot com crash this technology now is considered as a very important strategic factor in the US vs China game. So all in all his conclusions do make sense to me.
Circular financing is being used in this piece to imply a sort of shell game, which as I pointed out doesn't apply here. There are also record-level semiconductor buildouts, further proving this point. Physical constraints as a result - indicating actual demand, not financial tricks. Circular financing isn't by itself a negative, but is being implied here as a conspiracy shell game to pad pockets and bottom lines.
Furthermore, this type of financing isn't 'odd,' it's common capex circularity used across industries. The level is intense, but not directly threatening to the system as subprime mortgages were - that's one of my main points here.
The tech scene in 2000 was a very strategic factor not just for the US, but the world too. Hence why it rippled out so far.
If you say so
Lau - your analysis is spot on. Having been on a few phyle calls with you, I can confirm that you are smarter than I look!
Ha ha. Appreciate it, Dart.
Curious what you think of my response.