I should have been more precise with my use of "vendor financing" in saying "trade credit." I agree that the guarantees are where the risk is. First, under US

I should have been more precise with my use of "vendor financing" in saying "trade credit." I agree that the guarantees are where the risk is. First, under US GAAP accounting rules (ASC 606), these are absolutely not repurchase agreements. The customer takes title to the asset (the chips) and Nvidia does not have a contingent obligation to repurchase the asset. Providing a contingent guarantee to purchase services is not a repurchase under the accounting rules, but of course you can have legal accounting and still have a problem. As I've made public market investments in and traded in this space, I've done some math on the guarantees and what came out was this: relative to Nvidia's current earnings, the guarantees amount to approximately a quarter of a year's revenue at the guarantee cap. That's my own analysis and I'd encourage anyone who cares to run the numbers themselves. It's easy enough as Nvidia is publicly traded. The thing that differentiates Nvidia from previous vendor financing examples like Lucent in the 1990s/early 2000s is that its margins are huge. So what I see, based on the current numbers, is that in the really ugly scenario, Nvidia has to live with depressed earnings, no stock buybacks and a weaker (but still comparatively strong) balance sheet for a number of years. This is a stock problem, not a solvency issue. The wildcard is if Nvidia keeps extending big guarantees, or starts using debt to do so, to the point where the commitments are expanding faster than its cash flow. At that point, the risk obviously compounds accordingly.