16 ms·

Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

• Johnny_Bonk 5mo ago
  What a headline
• rconti 5mo ago
  So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.
  • Avicebron 5mo ago
    Better for whom?
    • SecretDreams 5mo ago
      The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO. Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.
      • JumpCrisscross 5mo ago
        > The company. Worse for the investors It's worse for the new investors. (If it crashes.) It's great for the old investors. They got an opportunity to sell if they wanted. If they didn't, they still own their shares, except in a company that has that IPO cash sitting in its account.
        • SecretDreams 5mo ago
          Yes, correct. Although, even for some company folks, if it crashes, they get burned since they typically have blackouts post IPO. Of course, some special souls are excluded from blackouts lol.
          • JumpCrisscross 5mo ago
            > if it crashes, they get burned since they typically have blackouts post IPO In the alternate timeline they would have held shares in a private company. They're still not really getting burned other than getting a tax bill.
  • bickfordb 5mo ago
    The only reason I can think of for the accelerated S&P 500 inclusion of SpaceX is a pump and dump
    • JumpCrisscross 5mo ago
      > the accelerated S&P 500 inclusion of SpaceX To be clear, S&P hasn't announced a decision on this yet.
      • jackyinger 5mo ago
        Perhaps they’re afraid announcement would trigger divestment
        • JumpCrisscross 5mo ago
          > Perhaps they’re afraid announcement would trigger divestment S&P don't get a choice around whether they announce their methodology or not. That said, the rule change at the NASDAQ 100 doesn't seem to have impacted pricing or allocation. I can't imagine that many people are that concerned about this. (I posted the public-comment request from S&P to HN [1]. The response was crickets.) [1] https://news.ycombinator.com/item?id=48054324 https://news.ycombinator.com/item?id=48054324
          • rconti 5mo ago
            Just yesterday I asked my advisor about exposure to these IPOs. I don't mind having a small bit of exposure to them, I just don't want the outsized share they seem to be trying to take for everyone.
        • LostMyLogin 5mo ago
          I imagine the vast majority don’t care. All they care about is trying to hit their 401k or Roth IRA contributions for the month.
        • willis936 5mo ago
          I can assure you they are already seeing divestment in preparation.
  • paulpauper 5mo ago
    People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023. When was the last time since 2009 there was a $500+ billion tech valuation that lost 90% or more? After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.
    • hungryhobbit 5mo ago
      Read history: people always think everything is fine ... until it isn't.
      • JumpCrisscross 5mo ago
        > people always think everything is fine ... until it isn't History is also replete with people constantly predicting collapses that don't come. Timing the market is very hard with numbers, it's total nonsense if one is just going off vibes.
        • za_creature 5mo ago
          Most bank runs tend to be driven by vibes, not numbers though. The good news is that these folks seem to be in possession of a vibe-rator.
          • JumpCrisscross 5mo ago
            > bank runs Anthropic, SpaceX and OpenAI are not banks. (Also, we had the largest bank runs in American history three years ago. The ordinary American barely noticed.)
            • za_creature 5mo ago
              They're not profitable either, so the money has to come from somewhere, no?
  • aurareturn 5mo ago
    I don't think OpenAI or Anthropic are predicting that the AI market is going to collapse. In fact, I think both are bullish that the public still isn't pricing in exponential growth. I think what is happening is that OpenAI is racing to IPO before Anthropic because their growth isn't as impressive. If you are the weaker company, you should IPO first to lock up the cash.
    • Avicebron 5mo ago
      What are they offering the public (not me and you writing code in our free time)?
      • aurareturn 5mo ago
        They are offering the public an opportunity to become shareholders and they are giving their investors and employees liquidity.
        • Avicebron 5mo ago
          I mean as a long-term product, not as a offer to join a hype cycle.
          • aurareturn 5mo ago
            Automating a large portion of existing white collar work, accelerating scientific discoveries, brain for robotics, etc. These are compelling offers.
            • Avicebron 5mo ago
              Sure, how does that benefit the public?
              • aurareturn 5mo ago
                I don't know. Some will benefit, some will not. The topic here is the IPOs.
  • dangus 5mo ago
    I'm not sure how long we can continue being negative about these AI companies. This idea that there will be a crash has often burned the bears in a way that has become an Internet meme. In reality, corporations as a whole are seeing record profits continuing through 2026. Whether or not the average person is doing well is pretty irrelevant to the stock market: if companies are increasingly profitable, stocks go up. Everything I hear about Anthropic points to a company that is actually closer to profitability and possibly already profitable, unlike many of its other peers. We don't really look at YouTube as a failure and that product was unprofitable for many years. Nobody thinks the Uber bubble is going to burst even though it has never made back its investment money. I think OpenAI is undisciplined and poorly run hence the insane burning of cash. Sam Altman is a terrible CEO and a conman. Anthropic is run by legit people. Companies like Google, Microsoft, and Meta face essentially no negative consequence for burning cash. They have no urgent need to be efficient about their AI investments, even if they could be. SpaceX is of course not profitable and has a lot of baggage but they still have a major asset, which is that Starlink prints utility company levels of money and is expanding both customer base and profit margins rapidly. Are they overvalued? Yeah, of course.
• hootz 5mo ago
  So, The Economist's paywall is unbypassable?
  • tristanj 5mo ago
    Download the Bypass Paywalls Clean browser extension. https://en.wikipedia.org/wiki/Bypass_Paywalls_Clean https://en.wikipedia.org/wiki/Bypass_Paywalls_Clean The project has been going on for years, it moved to gitflic after being banned from github and gitlab.
    • hootz 5mo ago
      Amazing! Thank you!
• paulpauper 5mo ago
  Why wouldn't it? There huge demand for these shares. It's not like $3+ trillion is dumped at once. It's a tiny percentage of it, and the high multiple does the rest of the work.
  • asjgGa6 5mo ago
    There was a huge demand for the World Online IPO in The Netherlands in the late 2000 bubble. Retail investors bought it thinking they got a unicorn. Turns out it was a scam and shares fell on the first day. Soon after the entire bubble burst. That said, I don't even see "huge demand" for the AI triocorns right now. Unlike in 2000, most people are skeptical.
    • aurareturn 5mo ago
      World Online IPO €64 million revenue on €91 million losses. Meanwhile, Anthropic is adding ~$10-$15b ARR every month. That said, I don't even see "huge demand" for the AI triocorns right now. Unlike in 2000, most people are skeptical. I personally think there is massive demand. I think Anthropic will easily eclipse $2 trillion marketcap on first day of trading.
      • schonfinkel 5mo ago
        > Meanwhile, Anthropic is adding ~$10-$15b ARR every month. I'd like to see how creative their accountants are before thrusting any numbers like that.
• timmg 5mo ago
  The way I've been thinking about it: there is too much money trying to pour into the market. That's why valuations are so high. Maybe getting more of these big private companies public will bring valuations down a bit. (Just my impression. No math or financial studies behind it :)
  • JumpCrisscross 5mo ago
    > there is too much money trying to pour into the market Keep in mind that inflation ran over 7% annualized in April [1]. [1] https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm
    • philipallstar 5mo ago
      Inflation is a measure of the cost of living. It's not got loads to do with large-scale, institutional investments.
      • 9question1 5mo ago
        That depends. Inflation is a measure of the cost of living in terms of currency. It can be high either if goods and services required for living become scarce, or if currency supply increases. Currency supply increasing does affect asset prices.
        • philipallstar 5mo ago
          Yes, but they're not directly correlated. Of course events can affect them both! Going to war would both increase the cost of living and (some) asset prices would go way up. But that doesn't mean they should be measured together like that.
      • JumpCrisscross 5mo ago
        > Inflation is a measure of the cost of living The faster your cash loses value, the stronger your incentive to trade it for something else. That something else can be financial assets. > It's not got loads to do with large-scale, institutional investments For investors, particularly retail investors, the consumer price index is most relevant. But for whatever it's worth, producer prices are up over 16% in April (7% excluding "foods, energy, and trade services," which jumped over 50% annualized) [1]. To be clear, I'm floating a hypothesis here. I have seen no evidence linking inflation to demand for these companies' shares. (If anything, it should be the inverse.) [1] https://www.bls.gov/news.release/ppi.nr0.htm https://www.bls.gov/news.release/ppi.nr0.htm
• JumpCrisscross 5mo ago
  Net buying of corporate equities by American households, trusts, funds and non-profits has averaged $660bn per year for the last few years [1]. $200bn is not fundamentally a stretch for the American equity markets, let alone capital markets more broadly. [1] https://www.federalreserve.gov/releases/z1/20260319/html/f224.htm https://www.federalreserve.gov/releases/z1/20260319/html/f22... line 16, 2023 to 2025
  • idiotsecant 5mo ago
    A third of all spending is not fundamentally a stretch?
    • JumpCrisscross 5mo ago
      > A third of all spending is not fundamentally a stretch? Where did you get spending? That's net buying of stocks by non-financial Americans. It's the new money that has, on average, gone into the U.S. stock market from that section of investors every year. A third of it going into these new issuances doesn't need to break anything.
      • djeastm 5mo ago
        Dumb question here, but would it necessarily mean the other stocks they might've bought (i.e. the rest of the market) will not get the cash infusion and will thus likely drop in valuation?
        • JumpCrisscross 5mo ago
          > would it necessarily mean the other stocks they might've bought (i.e. the rest of the market) will not get the cash infusion and will thus likely drop in valuation? ¯\_(ツ)_/¯. Almost certainly, to some degree. But that doesn’t mean anything has to drop. Just not rise, or not rise as much as it would have. Or potentially some other company that would have gone public or sold shares doesn’t do it now.
      • themafia 5mo ago
• jmyeet 5mo ago
  So what people seem to be unaware of or are purposely ignoring is that OpenAI and Anthropic have invested trillions in a rapdily depreciating asset. There was a HN post from a day or two ago where someone bought a V100 for 150 pounds and connected it to their computer. Well that was a $10k GPU in 2017. That's the fate of H100/B100 GPUs in 5-10 years (and I suspect closer to 5). What do you do if you've invested $1 trillion that will be worth $100 billion or less in 5 years? I think it'll be worse than that because modern hardware at that time will still probably be the same Wattage but have much higher performance so you'll be getting much higher performance-per-Watt and that's going to really matter. The only company I'm confident will survive this hardware crunch and still be relatively successful in this space is Google. OpenAI in particular is a bet that there will be an AI moat and that OpenAI will "win". I don't think there will be a moat and China is a big reason why (eg DeepSeek). SpaceX is a little different. Yes, launching rockets is a business but it's not a trillion dollar business. 100 Falcon 9 launches doesn't even break $10 billion in revenue. Plus, Starship faces cost overruns, delays and significant headwinds. But the real kicker is that SpaceX was used to bail out Elon from the Twitter purchase and the xAI investors from the first Twitter bailout. That's a problem because xAI is burning $1 billion a month in a company where that really matters and I don't think Grok will "win" here. Like, at all. SpaceX would be a significantly more attractive company without xAI. The big potential growth area is Starlink. For that to justify this valuation I think you need handheld Starlink phones. That requires a lot of satellites at a relatively low orbit, which also means they have a relatively short life (because they burn up in the atmosphere). And for that Starship must succeed. All the AI data center in space stuff is complete bullshit. It makes no sense. It'll never be viable. It's not going to happen. EDIT: let me clarify because I was careless in my wording. So, Anthropic individually has not spent "trillions". That was more of a general statement on AI spending. Anthropic has raised ~$100B, the last round of which was $65B (at $965B post-money IIRC). This industry as a whole needs to recoup trillions. Anthropic seems to be in a better position (as a business) than OpeNAI is but I do think the it's a race to cash out before depreciating assets, well, drepreciate and there's the real risk as compute becomes cheaper and the AI craze wears off, Claude just may not have the growth trajectory that is built into the price.
  • JumpCrisscross 5mo ago
• SilverElfin 5mo ago
  Can the stock market remain legitimate after such a brazen example of dumping? Regular everyday people can’t access private shares and participate in upside even if they want to. They don’t have the connections like VCs, and aren’t accredited investors. And companies ban secondary transactions, which should be forced by law to be always allowed. And then after all that, the public have to deal with their index funds, ETFs, mutual funds, pensions, 401ks, etc buying up these overpriced stocks. You have a space company that also acquired a failing social media platform and failing AI company with little revenue justification for the valuation, and a lot of other obligations that make it financially a disaster (like payments owed for spectrum). And two frontier labs with no real moats, each looking for regulatory capture based on safety or ethics or whatever. To the everyday person, the stock market after the fast listing rule, these three IPOs, and AI job loss, will feel no more legitimate than prediction markets or crypto.
  • JumpCrisscross 5mo ago
    > then they have to deal with their index funds, ETFs, mutual funds, pensions, 401ks, etc buying up overpriced stocks Only about a third of American stocks are held by passive capital [1]. Out of that, index funds are about 16%, and most of those in America reference the S&P 500, which has not yet announced whether it is changing its rules. [1] https://alexchinco.com/double-what-you-think-it-is.pdf https://alexchinco.com/double-what-you-think-it-is.pdf
    • vmbm 5mo ago
      Sure, but it's the Americans that can least afford to be stood up as exit liquidity that have the most exposure here relative to their net worth. The ultra wealthy are going to be heavily overrepresented in the active basket. Meanwhile the folks lower down on the income scale are more likely to have their money in passive funds.
      • chilipepperhott 5mo ago
        > The ultra wealthy are going to be heavily overrepresented in the active basket. Do you have evidence to substantiate this claim? My brief research has shown the wealthier the investor, the likelier they are to use a passive strategy.
• 34aghgf 5mo ago
  [flagged]
  • linkregister 5mo ago
    YCombinator News is like the Soviet Union?
    • Xunjin 5mo ago
      In the YCombinator the news plays you.
• SomaticPirate 5mo ago
  No doubt these companies are woefully overvalued. But this won’t stop me from putting in orders for several thousand dollars of shares with at market open. There will undoubtedly be plenty of buyers and I expect them to gain rapid entry into the indexes which will unlock a flood of additional capital from 401ks and pensions
  • dTal 5mo ago
    Why? You think an obvious scam is easy money for you? You think you're smarter than the next retail investor? Why? Don't give your money to Elon Musk, he doesn't need more.
  • paulryanrogers 5mo ago
    So timing the market?
• d_burfoot 5mo ago
  > Firms in the broad Russell 3000 share index have a total market value of $79trn I sometimes try to get people to worry about the catastrophic state of American public finances by pointing out that the net national debt, including unfunded liabilities, is estimated to be $175T [0]. The government could appropriate all the equity from the top 3000 largest companies, and also the entire real estate market, and it still would not be able to pay its debt (RE market is $55T). [0] https://balajis.com/p/americas-175-trillion-problem https://balajis.com/p/americas-175-trillion-problem
  • deleted 5mo ago
    [deleted]
  • ElProlactin 5mo ago
    The thing is that at these levels of debt, repayment is never the goal.
    • LPisGood 5mo ago
      How can you use a word like “never” when this debt is literally unprecedented in the history of the world
      • avaer 5mo ago
        It can never be repaid. Presumably the people in charge of generating it are not oblivious to this fact. "If you owe the bank $100, that's your problem. If you owe the bank $100 million, that's the bank's problem."
        • sarchertech 5mo ago
          It goes beyond that. $175 trillion includes all future entitlement spending not debt, it’s crazy to call all future entitlement spending for every living person debt. By that metric there’s essentially no such thing as a solvent government anywhere in the world and there never has been in modern history.
    • 5mo ago
• joegibbs 5mo ago
  Anthropic at $1t for an IPO vs Google at $23b in 2004 sounds insane but Google's revenue at the time was $2.7b while Anthropic's already at $47b, so a valuation at about 20x vs 10x revenue. Anthropic also has very high revenue growth (50x since 2024), it doesn't seems quite as insane as it could be.
  • testrun 5mo ago
    That is revenue. What is the net profit?
    • giancarlostoro 5mo ago
      They reported 559 million in Q2 of this year. OpenAI on the other hand, is nowhere near this.
      • qaq 5mo ago
        because of the mutual sweetheart deal with SpaceX SpaceX gave em discount for the pre IPO quarter so they can show profit Anthropic signed a deal to lease compute that is the bulk of SpaceX revenue
        • zuzululu 5mo ago
          and i think here lies the chess move by Elon he's trying to steal OpenAI's limelight and shit on their road show I'm actually quite surprised how much money Anthropic pulls Also surprised that OpenAI is not pulling as much as I thought All in all it looks like OpenAI is in a bit of a vulnerable position.
          • qaq 5mo ago
            I don't know if it is a chess move but Elon certainly will take every possible opportunity to fk over Sam. Have to admit watching these two sociopaths duking it out is somewhat entertaining.
      • 5mo ago
• ravenstine 5mo ago
  All these things are apparently valued at trillions of dollars these days. Where's the trillions, or hundreds of billions worth in improved quality of life? What has gotten better other than the ability to produce more crap?
  • JumpCrisscross 5mo ago
    > Where's the trillions, or hundreds of billions worth in improved quality of life? I think these IPOs are going to mint tens of thousands of new millionaires or something. That, in turn, will generate massive tax windfalls for all levels of government. > other than the ability to produce more crap? This is a big "other than." (And to be clear, the jury is still out on whether AI will let us produce more in the long run.)
    • nixon_why69 5mo ago
      It's not a pyramid scheme, it's a reverse funnel.
    • avmich 5mo ago
      If jury is still out on positivity, long term, of AI, I'd really like to see arguments for that. Historically all - almost? - technical improvements were net positive; even some blunders had upside. AI is dangerous, yes, but e.g. fission was developed for the bomb, and now powers significant numbers of households worldwide - the tech less than 90 years old.
      • JumpCrisscross 5mo ago
        > all - almost? - technical improvements were net positive I think it’s very likely AI is a technical improvement. But there is still a chance it’s a small improvement being massively overbuilt.
    • cloudfudge 5mo ago
      "Tens of thousands of new millionaires" sounds like a disaster tbh.
• golden-face 5mo ago
  Feels more like: can the bond market handle any potential outflows as money is rotated into these IPOs?
  • JumpCrisscross 5mo ago
    > can the bond market handle any potential outflows as money is rotated into these IPOs? Yes. Even if this capital is just rotated out of the equity markets, it would be fine. The bond markets are orders of magnitude deeper.
• megadragon9 5mo ago
  I don't think the market will swallow the stock offerings until we see early signs of GDP growth attributable to these entities. But until then, I think the cost is higher than the benefit, which "The dead economy theory" essay covered it well [0] [0]: https://www.owenmcgrann.com/p/the-dead-economy-theory https://www.owenmcgrann.com/p/the-dead-economy-theory
  • JumpCrisscross 5mo ago
    > don't think the market will swallow the stock offerings until we see early signs of GDP growth attributable to these entities Investors in these companies are going to be looking for revenue and pathway to profitability. I'm not sure anyone needs to see an impact on GDP to invest.
• augstein 5mo ago
  For SpaceX (and possible the others): Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. From https://x.com/Hedgeye/status/2060435253928604065 https://x.com/Hedgeye/status/2060435253928604065: "Rule changes for the SpaceX $SPCX IPO: Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5. This forces over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. Bloomberg Intelligence estimates S&P 500 funds must absorb 19% of SpaceX's float within 6 months. Russell 1000 and Nasdaq 100 funds will absorb 24%. The rules built to protect passive investors: 1. S&P 500 has required 12 months of trading and 4 quarters of GAAP profitability since 2002. Both waived. 2. Nasdaq cut its inclusion window from 90 trading days to 15. 3. FTSE Russell cut its to 5. All three benchmarks are now structured to buy SpaceX at IPO pricing."
  • deleted 5mo ago
    [deleted]
  • thegreatpeter 5mo ago
    It’s an index fund. It must follow the index. They’re forced to buy any company in the SP500. They are buying it at IPO pricing
  • JumpCrisscross 5mo ago
    > All three benchmarks are now structured to buy SpaceX at IPO pricing S&P has not finalized a rule change yet.
    • lovich 5mo ago
      Do you think it’s more or less likely that they will make the same change as the other benchmarks?
      • JumpCrisscross 5mo ago
        > Do you think it’s more or less likely that they will make the same change as the other benchmarks? S&P has historically been more conservative. My personal guess is they won't adopt all of the proposals.
• rvz 5mo ago
  How long have the SpaceX, OpenAI and Anthropic investors been waiting for an IPO (excluding tender offers)? 24 years, 10 years, and 5 years. You really think they are going to hold off against selling for multi-millions for another year, especially SpaceX? OpenAI (and especially) Anthropic are at risk from being undercut by the Chinese labs and their open-weight models and may cause their valuations to be questioned. If that doesn't cause a correction, then SpaceX will do it for them. There is no lock up for the 5% of shares being available.
• taurath 5mo ago
  [flagged]
  • gruez 5mo ago
    If you have evidence of corruption, present it. Otherwise it's just generic cynicism leading to a thought terminating cliche.
    • dools 5mo ago
      At this point in US regulatory oversight I would have a harder time finding evidence of no corruption.
      • deleted 5mo ago
        [deleted]
      • BostonFern 5mo ago
        Then present your evidence, so we can have a substantive debate and draw informed conclusions.
        • dools 5mo ago
          My evidence of no corruption? I can’t find any because the admin is so horrendously corrupt.
    • noonething 5mo ago
      [flagged]
    • jimjimjim 5mo ago
      I think deep cynicism is the correct mindset to have in the current financial/political climate.
    • wookmaster 5mo ago
      Why else would they change the rule ?
• modelhub 5mo ago
  [flagged]
• BLKNSLVR 5mo ago
  Is SpaceX going to eat Tesla? As in, are a bunch of Tesla investors going to be migrating across to SpaceX since that seems to be getting more of Elon's attention these days, especially with xAI barnacled onto the side of it? The money to participate in the IPO has to come from somewhere...
  • milowata 5mo ago
    Yes. Elon has a massive controlling share in SpaceX, complete control over the board. SpaceX will be double the size of Tesla after a successful IPO, then they can swallow it and then he has the control over Tesla he’s constantly fighting for.
• worik 5mo ago
  What is the value proposition for Space-X? As far as I can tell it is in machines they cannot make work, servicing markets that do not exist for a service that will not matter for 20-years. That and a third rate AI company that no body wants, except to get rid of. This will probably go swimmingly at the start - but as time goes by and they raise more capital, Musk snorts more K and the glory fades, what then?
  • Ekaros 5mo ago
    I don't really see anything that really matches their valuation. Yes there is some value in launching stuff in space. But it ain't not trillion. And for starlink. There is some market. But if terrestrial options got their stuff together it is not that big either. Userbase is marginal. As they operate in areas that are not served by other options. And that market has real limit in size.
    • trgn 5mo ago
      i feel like starlink could be huge, why not the default internet connection for everybody. similar to how people abandoned landlines for cell phones.
      • Zigurd 5mo ago
        Customers who have fiber don't replace it even with terrestrial wireless.
  • fsuts 5mo ago
    It’s not value proposition, it’s profit The market : As long as you sell for more than you buy, who cares what happens long term Hence Tesla bubble Finance bros look to their bonus for the year, not 5 years
• skybrian 5mo ago
  From Matt Levine’s column today: > The index demand is not 100% of the stock available in the IPO, or 110%, or even 50%. But it’s plausibly more than 25%. It’s not a short squeeze, but it’s a lot. Add a reported 30% allocation to retail, and arguably a majority of the IPO is being sold to price-insensitive investors. That is one way to get a high IPO price.
  • DC-3 5mo ago
    Do the indexes have some capacity to defer / waive buying into new stocks if they judge it in the interests of investors?
    • deleted 5mo ago
      [deleted]
    • tylervigen 5mo ago
      No, arbitrary decisions would defeat the point of indexes. But they can and do add systematic protections, like only buying based on the free float to avoid a short squeeze.
• chopete3 5mo ago
  One other angle to think of is the midterm elections. There will be chaos and potential stall for another 2 years following the elections and if the democrats win. There will be natural vested interest in showing economic decline or bad things to win next elections. Both parties do it. This is the best time to get to a safe place for all these companies.
• nelox 5mo ago
  What a stupid proposition. The capitalisation has already flowed to theses companies through private means.
  • greggoB 5mo ago
    So then what is the point of them seeking to do an IPO, if they are already capitalized?
    • nelox 5mo ago
      [flagged]
    • fsuts 5mo ago
      Investors can bank a profit at what they regard as the peak of the hype
    • torlok 5mo ago
      People who helped Elon buy Twitter want their money back. After all the share-swap acquisitions X shares are now SpaceX shares.
• jimjimjim 5mo ago
  I am actually curious in knowing an answer to this: Does anybody think this is a good thing? A benefit to the world? Not if anyone is cheating or scheming or being a rules lawyer, but is it good?
  • rf15 5mo ago
    I expect it to be catastrophic or at least chaotic and we have removed our investments from the american market and untied ourselves from the dollar as best as we can. We are sitting this one out.
  • vortegne 5mo ago
    Is anything in late stage capitalism good for the world? Any and all benefits are accidental and temporary.
• fastnalog 5mo ago
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• deleted 5mo ago
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• aaron695 5mo ago
  [dead]
• jurschreuder 5mo ago
  They're doing an IPO now because the war in Europe with Ukraine is almost over it seems, and after that a big percentage of capital will relocate from the USA to Europe again. They are just cashing out right before the tide turns.
  • ai_slop_hater 5mo ago
    Why is it almost over?
• zmysysz 5mo ago
  [flagged]
• ExoticPearTree 5mo ago
  I don’t understand why there is so much pushback and skepticisim about SpaceX. They actually have a functioning product, a market where they sell the product and virtually no competition at their pricepoint.
  • xdertz 5mo ago
    Because they lobbied for a rule change to get fast tracked to an index forcing passive investors to buy it at IPO price instead of being included after market value corrections.
    • tristanj 5mo ago
      This is completely wrong. Passive funds don't buy at IPO price. They buy after the inclusion rebalance which happens weeks later, at whatever price the market has already set. Plus the S&P500 rule change hasn't even happened yet, it's unclear if the rules in the current form will go through.
      • chilipepperhott 5mo ago
        THANK YOU. Everyone complaining about index inclusion in passive funds have clearly forgotten to read their respective prospectuses.
  • DarkNova6 5mo ago
    SpaceX is actually 3 companies, one of which is profitable. The satellite business operates at a loss and xAI is a money burning furnace.
    • ExoticPearTree 5mo ago
      > The satellite business operates at a loss How come? On the books or they're actually selling internet cheaper than they source it? > xAI is a money burning furnace So far in the AI business, it looks like only Anthropic might be profitable in the near future. On the other hand, a lot of nonprofitable companies have IPOd for billions with the hopes that one day they will become profitable.
• epolanski 5mo ago
  According to SpaceX's own S100 filed to the SEC their future revenue is projected to be 93% AI and there's also where the overwhelming majority of the CAPEX will go.
• seydor 5mo ago
  Index funds had a remarkable run. They avoided Goodhart's law for decades
• AJRF 5mo ago
  If I buy the SpaceX stock it's 100% certain to go down. If I don't buy it it will rocket to the moon. Is there some sort of way I can positively monetise this?
  • energy123 5mo ago
    Keep buying single shares slowly so it keeps going down. Once it reaches $0, buy the rest for free and asset strip.
    • make3 5mo ago
      asset strip to the moon, literally
  • danw1979 5mo ago
    Buy it both long and short, then it’ll just hold steady !
  • adamors 5mo ago
    Well since SpaceX will be included in the SP500 and Nasdaq100 you'll buy it even if you don't want it.
  • raincole 5mo ago
    Package your portfolio as a reverse index fund.
  • SomeUserName432 5mo ago
    > If I buy the SpaceX stock it's 100% certain to go down. If I don't buy it it will rocket to the moon. The answer is clearly to buy stocks and then short it. (/s!!)
  • marcusverus 5mo ago
    DCA
  • IAmGraydon 5mo ago
    I think it's actually 100% certain to go up no matter what, at least in the near term. In today's market, it doesn't matter what a company is worth or how much money they make or lose. All that matters is what global attention share they make up. How many people are thinking about them at any given time. Money flows where attention goes.
• jillesvangurp 5mo ago
  Maybe to counter some of the apparently widely expected doom and gloom: - bubbles are notoriously unpredictable and generally don't happen when they are loudly and widely proclaimed to happen any minute now. - large scale infrastructure spending tends to be really good for economies. These three companies are creating lots of jobs that are mostly related to construction, energy infrastructure, hardware spending, etc. That's a lot of money flowing to suppliers and regions where that spending happens. - While overly pessimistic sentiments about AI and space companies are widespread they aren't much more rational than the overly optimistic ones. The realist scenario could actually be that, AI and especially Agentic AI is already quite useful and the total addressable market for that is obviously larger than it is today. The question is how large. Likewise, dropping the cost of launching stuff into orbit by one or two orders of magnitude, should create a much larger market for launching stuff there. Including possibly some AI relevant compute. The valuations of these companies are probably on the high side and I'd expect post IPO share values to drop quite a bit and would not personally consider buying anything until after that happens. But that won't necessarily trigger a stock market crisis or a collapse of these well financed companies. All the spending these companies are doing is very real and the profits of their suppliers are going to be equally real. So some of those share value losses might be offset by gains for other stocks and economic growth. The stock market and economy aren't zero sum games. However, there are worrying macroeconomic trends happening at the same time (Iran conflict, Ukraine war) that are disrupting global markets already. But you could argue that dumping tens or hundreds of billions into e.g. energy infrastructure and data centers isn't the worst way to counter those for a country like the US. The big picture might actually be pretty positive. Especially if we can dodge global economic misery via a prolonged Gulf conflict that at this point seems to serve no point whatsoever for anyone except perhaps Israel.
  • throwaway63467 5mo ago
    I think so too I’m just worried about how unequally these gains will be distributed, for myself I am quite pessimistic thinking that all these gains will not benefit my life, if at all it will move the needle more towards making my expertise and skills easily replaceable by switching human capital for agentic capital. So yeah really happy for Musk to finally make his one millionth million dollars but personally I’m middle aged and still struggling financially wondering if I can ever live comfortably or retire.
• opentokix 5mo ago
  [flagged]
• deadbabe 5mo ago
  Spacex is worth buying. The best chance to make a lot of money is buying stock before the economics make sense. By the time SpaceX looks like a good company on paper with strong profits… the price will be so high you have little chance of making anything significant. If it’s a long term hold, consider how far away retirement is for you. Also, moon bases are coming. The AI companies IMO are fucked. In the next few years computer hardware should advance to the point that local LLMs are good enough for everyday workloads. Not everyone needs top of the line flagship models in a cloud to see productivity gains. Companies will actually save money just buying employees top of the line laptops for AI enabled work than blowing that same amount on tokens every month.
  • trgn 5mo ago
    the AI companies make way way too much revenue to be f*cked, and people are hooked and they have not tested limits of their pricing power yet.
  • rc_mob 5mo ago
    Warning to readers-- do not take stock advice from random comments on the internet
    • deadbabe 5mo ago
      It’s not a random comment, it’s a comment from Hackernews which is filled with smart people who are tapped deep into these industries.
      • reducesuffering 5mo ago
        So you'll be buying if it's at $5T market cap then? Because if not, you agree it's a matter of how much it's worth to pay for the wildly different ranges of future growth.
        • deadbabe 5mo ago
          In 10 or 20 years when people are still bitching about P/E ratios the price of SpaceX will still be way higher than whatever you buy it at IPO. Either that, or it will be zero. 16 years ago when Tesla IPOed, people still bitched about it just the same way. Do you think buying and holding the stock all this time would have been some bad investment? Or what about bitcoin, which truly has no value? Read the room. Just get in there and make money, or get left behind.
• mattmaroon 5mo ago
  The index fund thing seems to me to be an overhyped nothingburger. The seasoning period would just delay the inevitable when a company is launching with a trillion dollar valuation. The big story is that that is happening at all. It wasn’t that long ago when Facebook had to get special permission from the government to stay private until they got to $100 billion. The issue here is that public investors are missing out on so much upside.
  • harambae 5mo ago
    >It wasn’t that long ago when Facebook had to get special permission from the government to stay private until they got to $100 billion. is this true? There was the "Jumpstart Our Business Startups" (JOBS) Act, signed by Obama around that time that changed the maximum number of private investors or whatever, but was special permission given to Facebook?
    • mattmaroon 5mo ago
      Oh I was wrong, they were forced to go public. At the time any company with $10 million in assets and 500 investors had to go public. Perhaps I misremember them trying to stay private and failing. But the point remains, it would have been unheard of for a company 1/10 the market valuation of these companies to be private, so the public market is missing a lot of the growth phase now.
• yabatopia 5mo ago
  At realistic valuations? Sure. At the current overvaluations? Yes. Are these valuations sustainable? No.
• slipknotfan 5mo ago
  pop the bubble already
  • rc_mob 5mo ago
    I been saying this for a year now and no popping. I dunno maybe they found a way to break the stock market so it never goes down.
• me551ah 5mo ago
  None of these companies have any MOAT. LLMs are getting better at a rapid pace and in a year or two, Chinese LLMs should easily catch up with the best of the models. Models have kind of reached a saturation point and that’s why OpenAI and Anthropic are doing an IPO now. Because a year down the line when their lead diminishes even more, they would be worth lesser money. SpaceX has clients to put payloads into space, but those clients have always looked for good low cost alternatives. It is going to have competition in the future and will lose customers.
  • abhaynayar 5mo ago
    I mean sure, for LLMs, but: > It is going to have competition in the future and will lose customers. Is that not true for everything.
  • tristanj 5mo ago
    > [SpaceX] is going to have competition in the future and will lose customers [to good low cost alternatives]. Okay, well who will offer a lower cost-to-orbit than SpaceX?
  • Zigurd 5mo ago
    SpaceX would tell you to look at how profitable is Starlink. Two things about that: you have to replace the infrastructure every five years while terrestrial infrastructure electronics lasts at least twice as long, and inert stuff like towers and fiber lasts for decades. And you can drive a truck to where it's located if there is a problem. Secondly, terrestrial infrastructure keeps expanding into the rural areas that Starlink counts on for most of their TAM. Except for ships at sea and extremely remote places, the Starlink TAM is chronically shrinking.
    • tristanj 5mo ago
      Several issues: 1) The short lifespan is intentional. There is no reason to keep satellites beyond a few years because older satellites quickly become obsolete. The first generation Starlink sats are now 4 generations old, and are practically ancient at this point. SpaceX wants older satellites to fail, so they can be replaced by updated ones. 2) SpaceX could easily increase the lifespan of Starlink satellites to 10-15+ years, but they don't want to, because of (1), and because they are waiting for Starship to launch larger satellites at 10x lower cost. 3) Despite continually replacing satellites every ~5 years, Starlink is operating at a very profitable 40%+ profit margin. 4) Starlink is expanding to direct-to-cell 5G at speeds up to 150Mbps, which vastly expands the TAM from just broadband usage to all cellular data usage. Rural areas may never get a terrestrial cellular buildout, since it will be cheaper for companies to partner with SpaceX for coverage than to build their own towers. A single cellular tower can cost upwards of >$250k.
• aitoolbooth 5mo ago
  [flagged]
• weatherlite 5mo ago
  Do we prefer the market will spit or swallow in this case?
  • ActionHank 5mo ago
    I believe we've settled on AI bros gargling all the stocks.
    • draw_down 5mo ago
      [dead]
• kaiwls 5mo ago
  [dead]
• Debo4416 5mo ago
  [dead]
• LetsGetTechnicl 5mo ago
  There goes my 401k
• BiteCode_dev 5mo ago
  That's how the new 1927 starts. It will be in the history books.
• kyledrake 5mo ago
  Is there an index fund that intentionally only focuses on actually profitable companies? It would actually be nice to hedge some funds into non speculative assets.
  • chilipepperhott 5mo ago
    Sure. The problem is that it is impossible to predict which companies will continue to be profitable.
• FlippieFinance 5mo ago
  There is a reason they IPO now I feel like. Markets at ATH, greed is bigger than fear. Now is the perfect time to IPO. Could very well be a bubble burst after that...
• Lonestar1440 5mo ago
  Back in 2008, we'd perfected the art of combining high-grade and dogshit Mortgages into one Security which could be sold on to, of course, Pension Funds. Took almost 20 years for someone to find a way to scale up the basic Scam Mechanics and try again. If you like SpaceX's launch business (the Grade A mortgage that you personally hold and pay), know that you can't get it without xAI (The dogshit that's already delinquent)
• hodder 5mo ago
  Of course the market can and this is a silly question. These issues are tiny amount of money for the global capital markets to swallow. Masa Son has endangered ostrich eggs for breakfast worth more on the daily. I kid, but seriously this is a very small amount of money to the global markets. It is more of a worry on the psychology than the size. Remember they arent selling the entire floats of these companies. I cant read the article because Im not willing to pay for the Economist, but 400-500b in equity issuance is not a big deal to the global financial markets even though it sounds big.
• Henchman21 5mo ago
  You guys remember that bit in Project 2025 where the plan was to crash the economy and buy up everything cheaply? Do we finally see the mechanism?
• tehlike 5mo ago
  Everything will be fine. You may see a little bit of dump here and there, but it'll come back roaring.
  • foxyv 5mo ago
    I'm not sure if it was intentional, but roaring is an interesting word to use here: https://en.wikipedia.org/wiki/Roaring_Twenties https://en.wikipedia.org/wiki/Roaring_Twenties
• pzo 5mo ago
  I did have few days ago conversation with AI to research how the economical environment was just before Great Depression and this doesn't look good if true. Definitely feels like someone try to dump their bags to retails investors and main street. - Trailing P/E: 1929 peak was 32.6 vs. 32.67 today. - Shiller PE (CAPE): 1929 peak was ~30 vs. 42.66 today (2nd highest in history). - Buffett Indicator: Market cap was 124% of GNP in 1929 vs. 259.6% of GDP today. - Margin Debt to GDP: 3.0% in 1929 vs. 4.1% ($1.304T) today. - Systemic Risk: 1929 margin debt was 10-12% of total market cap vs. 1-2% today. Modern leverage has structurally shifted from retail to sovereign debt and shadow banking.
• maerF0x0 5mo ago
  At least on SpaceX the float is really low. The Market only needs to "swallow" ~$100Bn in volume of shares (across the 3), which the NYSE does _daily_. the really interesting thing will be how much will other stocks go down because the passive dollars are chasing the new shares and have to sell to rebalance?
  • m101 5mo ago
    interesting question, and i used the AI for help on this one: $ value of equity purchased in indices: - total market cap of those 3: $3.6tn - index inclusion weights is based on free float, not full market cap - free floats ~5% => 5% * 3.6tn = 180bn of these stocks in MV weight in the index $ value of index funds: $18tn $ value of market cap that is tracked by these index funds: $57tn => index funds are 18/57 = 31.6% of the market value => 180bn * 31.6% = $57bn of stock included in the index funds so $57bn in sales in other companies => 57bn/18tn = 0.32% of all other stocks sold Now for the assymmetry here: - 57bn in sales is about 7% of daily volume for all incumbants combined - 57bn in purchase is about 15-30 days of volume for typical stocks (hence Elon's eagerness to get them included asap)
  • MagicMoonlight 5mo ago
    If we’re going to have a Great Depression, this will be the trigger. Every single fund autodumps billions in shares and is forced to buy slop. The dumping triggers the algorithm traders who dump. The dumping triggers manual traders to dump. The crashing causes retail to dump. Everyone dumps their treasuries and gold because they’re both crashing and they want cash. And there’s no capability to raise money in any western country, because everyone is already loaded up to pay welfare bills.
    • maerF0x0 5mo ago
      Exit index now, Buy non-slop at discount later. Profet.
• 3sk_ask8 5mo ago
  Mercedes would have a market cap of $2 trillion according to the ARR valuations. Instead, it has $150 billion revenue, $5 billion profit and a $50 billion market cap. Like Mercedes, Anthropic is not a growth stock because it has already been foisted on everyone.
• hsnewman 5mo ago
  86 X
• balderdash 5mo ago
  two thoughts, the top three s&P 500 etf's have $2.7t in aum (and there are a lot of other etfs, mutual funds, and direct indexers on top of that) - so the dollars don't seem to be the problem. I think its a little insane to have the seasoning rule for an index be inside the lockup period
• throwpoaster 5mo ago
  Maybe we changed the rules so that our capital markets can protect our champions from large Chinese buy pressure at lower post-IPO valuations. Plus, these companies have probably had to demonstrate earnings stability (yes, unaudited) in order for the rules to be waived. Is the text of the waiver and its reasoning anywhere? I guess I'll read tfa.
• nla 5mo ago
  No problem, the money will rotate out of the mega corps that do almost nothing into the next generation that is in the process of changing the world!
• LandoCalrissian 5mo ago
  Sure, if Elon gets to raid your retirement account it can.
• sspoisk 5mo ago
  [flagged]
• jari_mustonen 5mo ago
  Maybe I'm just old school but I prefer to buy the rocket business without a social network attached.