This is a market shock. The reason it doesn't alleviate sooner is the chip manufacturers are very wary of investing billions on capacity that won't come online until after the shock is over and subsequently going bankrupt. Because that's happened before.

IF IT LASTS, capacity will increase.

But it won't last. The AI boom is in exponential growth but it's based on heavy speculation about future value and the bubble will absolutely pop, how agressively depends on how dumb people are about now. The current growth may or may not be entirely justified but it's not sustainable, the free investor money does run out. These back and forth self-dealing deals where companies that own big pieces of each other announce "partnerships" where companies are selling resources essentially to themselves and counting the revenue several times... those are a sign of the approaching peak.

> the free investor money does run out

I've been saying the same thing, but that's why they made the move to IPO, no?

The money always runs out. The dot com bust (Nina Brink forever!) and more recently "let's give a homeless man a 250k mortgage" 2008 bust.

And then?

There are only so many trillion dollar IPOs out there. And then what next?

Then it's not their problem and the company can fail.

If you owe 1M USD, you have a problem. If you owe 100B USD, they have a problem.

More government money to fund the ever elusive doomsday AI.