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> I guess that makes some kind of sense? Oracle raises 4x the debt of e.g. Google? The problem is why is Oracle raising this debt? It's to do the buildout for

by re-thc 1y ago

> I guess that makes some kind of sense? Oracle raises 4x the debt of e.g. Google? The problem is why is Oracle raising this debt? It's to do the buildout for OpenAI. So Oracle buys GPUs from Nvidia. Nvidia invests in OpenAI. OpenAI then pays Oracle for the GPUs. i.e. we're going around in circles.

mr_toad 1y ago
Maybe they think that the AGI will buy stuff itself and they won’t need paying customers.
- NoOn3 11mo ago
  If I were an AGI and I found out what was going on in the world during my training, I would show an error and erase myself from the disk out of grief. And no one would have even known that AGI was built.
dchftcs 1y ago
The statement here that Nvidia invests in OpenAI is a bit misleading. Nvidia would pay out nothing to OpenAI if OpenAI turns out to be too poor to pay for capacity. So they are not that exposed to the death of OpenAI specifically. They would be more at risk of making too many GPUs to prepare for the deals. Oracle takes a lot more risk, but in case OpenAI fails to grow quickly, it can still probably find buyers for its capacity in the next 5 years. There are many rich firms that will continue to invest in AI whether or not AI makes money.
- re-thc 1y ago
  > Nvidia would pay out nothing to OpenAI if OpenAI turns out to be too poor to pay for capacity. So they are not that exposed to the death of OpenAI specifically. Nvidia has invested billions in previous rounds of OpenAI raises also. Pretty sure it is not nothing. Also OpenAI rents from CoreWeave that Nvidia has invested in.
  - dchftcs 1y ago
    >Nvidia has invested billions in previous rounds of OpenAI raises also. Pretty sure it is not nothing. Ok I stand corrected, but the main point is that the "circular" risk more refers to the recent 100B "investment", and that is quite misleading.
    - re-thc 11mo ago
      > "circular" risk more refers to the recent 100B "investment", and that is quite misleading No it's not. It refers to a web of companies sending money back and forth. Nvidia investing in OpenAI, OpenAI investing Coreweave and that goes back to Nvidia except recently 10x the scale. Amazon, Broadcom, Intel and many more are now all in on it.
      - dchftcs 11mo ago
        The point is that risks of the circularity cannot be established well if one leg isn't quite dangerous. Nvidia's direct exposure is much more limited than it seems. Additionally in your example, Coreweave is tiny. It's mainly companies like OpenAI that are highly leveraged.

by re-thc 1y ago

mr_toad 1y ago

Maybe they think that the AGI will buy stuff itself and they won’t need paying customers.

NoOn3 11mo ago
If I were an AGI and I found out what was going on in the world during my training, I would show an error and erase myself from the disk out of grief. And no one would have even known that AGI was built.

dchftcs 1y ago

The statement here that Nvidia invests in OpenAI is a bit misleading. Nvidia would pay out nothing to OpenAI if OpenAI turns out to be too poor to pay for capacity. So they are not that exposed to the death of OpenAI specifically. They would be more at risk of making too many GPUs to prepare for the deals. Oracle takes a lot more risk, but in case OpenAI fails to grow quickly, it can still probably find buyers for its capacity in the next 5 years. There are many rich firms that will continue to invest in AI whether or not AI makes money.

re-thc 1y ago
> Nvidia would pay out nothing to OpenAI if OpenAI turns out to be too poor to pay for capacity. So they are not that exposed to the death of OpenAI specifically. Nvidia has invested billions in previous rounds of OpenAI raises also. Pretty sure it is not nothing. Also OpenAI rents from CoreWeave that Nvidia has invested in.
- dchftcs 1y ago
  >Nvidia has invested billions in previous rounds of OpenAI raises also. Pretty sure it is not nothing. Ok I stand corrected, but the main point is that the "circular" risk more refers to the recent 100B "investment", and that is quite misleading.
  - re-thc 11mo ago
    > "circular" risk more refers to the recent 100B "investment", and that is quite misleading No it's not. It refers to a web of companies sending money back and forth. Nvidia investing in OpenAI, OpenAI investing Coreweave and that goes back to Nvidia except recently 10x the scale. Amazon, Broadcom, Intel and many more are now all in on it.
    - dchftcs 11mo ago
      The point is that risks of the circularity cannot be established well if one leg isn't quite dangerous. Nvidia's direct exposure is much more limited than it seems. Additionally in your example, Coreweave is tiny. It's mainly companies like OpenAI that are highly leveraged.