4 ms·

> Has anyone seen a definitive mathematical proof of this? I have seen countless articles and exposes about the hidden debt. There's an old WSB saying: the mar

> Has anyone seen a definitive mathematical proof of this? I have seen countless articles and exposes about the hidden debt. There's an old WSB saying: the market can remain irrational longer than you can remain solvent. The AI craze is that but on 'roids. > These are incredibly sophisticated companies so presumably they wouldn’t let themselves get into a company ending bind. The problem is, company C-levels don't care about the long term health of the company. They only think about next quarter (in a misguided interpretation of "shareholder duty/fiduciary duty") and their bonuses tied to their KPIs. > But what are the chances this is actually an MBS type situation where the system is truly overloaded and a few sacrificial lambs are needed? The system definitely is overloaded to hell and beyond after well over a decade of ZIRP. That money never got deflated out of the system in a healthy way and now everything is looking to fall apart. Unfortunately, such events are already "priced in". VC essentially is built on 1 of 100 investments striking it big and 99 going bust. A market correction won't hurt the big guys, but it will definitely hurt all the small guys.

kzzzznot 2mo ago
WSB? Keynes said that…
gradus_ad 2mo ago
That saying goes back long before WSB
coliveira 2mo ago
> incredibly sophisticated companies We need to stop thinking that just because they have money they're incredibly sophisticated. We have a few examples like Mark Zuckerberg, who had early success with FB, but he seems to be incapable of investing in profitable products. E. Musk: great at selling his companies, but laughably bad at making profits at the same level of expenses. Sam Altman: never had a real job he did well other than raising money. This is the kind of people that control these companies.
cavemandaveman 2mo ago
That's cynical nonsense that executives don't look past the next quarter. There would be none of this AI investment if that were true. It's all a long-term play with huge investments and minimal revenue by comparison in the short run. NVDA had the foresight two decades ago to invest in CUDA. That's not next quarter thinking.

kzzzznot 2mo ago

WSB? Keynes said that…

gradus_ad 2mo ago

That saying goes back long before WSB

coliveira 2mo ago

> incredibly sophisticated companies We need to stop thinking that just because they have money they're incredibly sophisticated. We have a few examples like Mark Zuckerberg, who had early success with FB, but he seems to be incapable of investing in profitable products. E. Musk: great at selling his companies, but laughably bad at making profits at the same level of expenses. Sam Altman: never had a real job he did well other than raising money. This is the kind of people that control these companies.

cavemandaveman 2mo ago

That's cynical nonsense that executives don't look past the next quarter. There would be none of this AI investment if that were true. It's all a long-term play with huge investments and minimal revenue by comparison in the short run. NVDA had the foresight two decades ago to invest in CUDA. That's not next quarter thinking.