It’s difficult to avoid the feeling that a horrible financial reckoning is on the way.
All these big tech firms are spending wildly to make sure they are the one on top at the end of it all. But whoever that ends up being there’s going to be one hell of a lot of fallout underneath them.
Yeah, but Google has the money for this. They are quite literally the most profitable company in the world. They are only raising because they don't want to harm there other businesses buy eating up their capital for this.
Why do you think there will only be one winner?
Personally I wonder if these AI services will have a different price soon.
Like how the early railroads or oil companies shook out and cost more than expected.
Maybe, but inference costs can come down too with more purpose built hardware and continual optimization and quantization strategies.
Especially because LLMs have no moat and they’re strategy is basically “we’ll figure out AGI first”
I feel there is a strong argument that if we described the capabilities of agentic systems today to someone from 2002, they’d say we’ve achieved AGI. It’s just not as impressive as we thought it would be.
At least not yet.
I don't understand where this $80B, +$150B for SpaceX, +$??B for each Anthropic and OpenAI is going to come from.
There's not that much cash sitting around.
Something is gonna need to get sold to transfer into those assets.
Unless central banks are just going to print money to invest in these companies, I don't know who else is going to be able to take on enough debt to prevent massive sell offs somewhere for this.
It's not like ~$400B is pocket change...
(1) There is currently $1T in dry powder in private capital markets
(2) Middle east oil money (Saudi Aramco's profit every year is $100B+)
(3) Public traders have been and are looking to cycle out of other investments into higher growth areas.
I don't think you understand the size of the US capital market. We are talking probably ~150 trillion.
It's easy as fuck for Google to raise this money because they are a money printing business. They are the most profitable company in the world, so for anyone this is basically the same as buying US debt.
> We are talking probably ~150 trillion.
Yes, but we are talking about liquidity not valuations...
Believe it or not there is actually a shortage of assets and an excess of money. That's in part why valuations are so bonkers.
This is equities + bonds which are pretty liquid assets.