Banks are now trying to offload the AI data center debt they just underwrote

And we won’t even get infrastructure out of this. Just a bunch of half finished data centers & $500B in currently warehoused specialized GPUs that can’t easily be repurposed.

Enron never happened. Let’s check on my Lehman Brothers position.

Look at Rip van Winkle over here.

One of the many lessons to take from Enron’s downfall. Downfalls like this always seem impossible until the downfall happens. Then it becomes obvious why the downfall was inevitable.

Steve Eisman has entered the chat

??

I wish the same things, but, post to YT -500k views-paycheck. Post to Obscure Streaming Service- Only fans see it/care.

I love Nebula, but I always make sure my favorite creators get clicks on both platforms, because I’m unsure of the pay model.

Please correct my ignorance.

I have never heard of these channels. But if they are on YouTube to generate money, then they must grow views, and thus they’re subject to the algorithm. And thus you are getting your information filtered through the algorithms preferences.

It’s not censorship, but it’s a constant force that pushes content creators into one direction, and if you’re somewhat informed I don’t need to line out what direction that is. It’s just another algorithm based anti social media.

Ignore pretty much anything farming related from More Perfect Union - they tend to provide farm lobby propaganda without actually fact checking it. I’ve become much more sceptical of their other coverage based on how bad that segment of it seems to be.

i dont log in to youtube, but if i see a pattern i just refresh it by closing the browser.

Wow. I didn’t know you could do this. Ty

Each one of the content creators ais subject to the same forces that the algorithm creates. No matter where you start, the content plus the algorithm slowly pushes you as well as the content creators into one direction. It may be a weak force, but it’s always there. content creators who want to grow their views do not have the liberty to evade it.

The direction is always towards divisive positions and decreasingly evidence based arguments, generally anti institutional, anti science, anti journalistic media.

YouTube as a feed is poison for a healthy mindset.

Even Enron was outperforming, just saying…

Their yields going higher and higher is not “outperforming”, it’s the opposite. Higher yield = higher risk.

Do you think they can maintain that for another 5 years? Another 20? Is the product AI companies providing worth the valuations?

Are 5 AI companies providing more value than every other tech company in the last 50 years? Thats what the valuations are trying to say. Im still waiting on ChatGPT to cure cancer.

So did .com in the early 00’s and houses in the late 00’s

Do you have any statistics?

Not improvements to the AI themselves, but rather the software that runs them. Backends like Unsloth are typically generalists - they are compatible with all sorts of hardware, but in exchange, they don’t incorporate the latest improvements or ideas. Projects run by pure human implementation tend to require a lot of oversight to ensure that additions don’t break functionality.

AI is really good at collecting and aggregating information. This makes them ideal for creating tailor-made products that have a narrow focus, since they raid many Githubs and papers, then attempt to make them into a product. Strata is one such backend, which is specially designed for Qwen Next-Flash.

Strata runs much faster than Unsloth and other generalist backends, but lacks flexibility in what it is suited for.

At least, that is my admittedly basic understanding of the situation…

GenZ Literally never having seen a functioning economy (at least while being old enough to meaningfully comprehend its existence) I imagine Generation Alpha is gonna have it even more fucked.

Yeah, this will be like 2008+dotcom×2

My favorite quote from The Big Short:

In the years that followed, hundreds of bankers and rating agency executives went to jail. The SEC was completely overhauled, and Congress had no choice but to break up the big banks and regulate the mortgage and derivatives industries.

Just kidding. Banks took the money the American people gave them, and they used it to pay themselves huge bonuses, and lobby the Congress to kill big reform. And then they blamed immigrants and poor people, and this time even teachers.

One brown man faced legal consequences for the 2008 crash. One brown man.

Who was held responsible? That was a big joke.

One part of that is just a story. As for the other part: I’m glad Frodo made it with help from his friends.

The Simpsons prove to be good prophets again.

they wouldn’t sign such stupid deals for no reason.

Greed. The reason was greed. They bought into the hype and thought they could print money.

And all the tech companies are doing it, Oracle was just the sick man of the bunch, and will be the first to fall, dragging the rest down with them.

All because they’re offloading trillions in debt to special purpose vehicles, the same thing that tanked Enron, the difference is that Enron, with $400 million in debt, was lying about it, and the current tech companies doing the exact same shit, are disclosing the debt legally, but still hiding it in the fine print of their disclosures.

The debt will still crash the economy, but at least it’s out in the open?

Wisconsin has a preternatural ability not to learn things tho. They’re up there with Kansas and Florida.

The Foxconn deal was always a scam, I doubt they learned anything from it, other than to deny before the midterms and then cave to them after, which is I presume the plan.

Wisconsin is so heavily gerrymandered they have one of the worst state governments in the country, and they used to have one of the best.

Edit: Although maybe their supreme court ungerrymandered the state part, or was it the fed part? Either way, they are all crooks and will side with big money after the election you better believe they will try.

I offer you an IOU. I’m on a good streak, and the IOU is that I’ll pay you back over time with interest.

You accept. You then find 9 other people offering IOUs of varying reliability.

You package up all the IOUs into an asset group. In theory we all pay you back regularly, but some of us will not. With 10 IOUs it’s unlikely we’ll all default, so the asset is safer and your risk models can assess this.

You still have the same amount of debt and risk on your hands.

You turn sell the rights to the payouts from the group, in exchange for cash now, because paying $X for payback of Y% interest over Z years with Q risk is an easy to reason about deal.

But your potential buyers squabble over Q, some don’t want to lose anything, some want to be risky.

So you split that risk level out into groups and say “if the overall goes down, this group pays first, then this group, then this group”, and you’ve created a securitized asset.

You’ve now sold off these assets to various groups, with defined risk levels, and you’ve made back money to offset what you paid out to the initial 10 IOUs.

Now imagine you took IOUs from crack addicts who are talking a lot about the power transformer behind the mall. They say they need money for tools and this will be the big one. You’re intrigued.

Odds are good this will pay off you think, those crackheads were excited and confident.

Later that day you hear sirens. Like, a lot of sirens. It’s coming from the mall area. Huh.

You still haven’t sold off all the slices of your asset, you were maybe hoping for more upside, and selling can take a while. But those sirens… they’re concerning.

Maybe it’d be a good idea to swap out your asset for another one, or offer those slices at a discount for some higher than expected risk. So you go out and start making phone calls hoping someone else isn’t worried about it. The only people who are less worried are a biker gang you normally wouldn’t do business with, but you figure for a discount they’re happy to deal with the crackheads.

(This was more about securities than recapitalizing, but kinda the idea)

Any sufficiently advanced financial instrument is indistinguishable from fraud

The golden rule: he who has the gold makes the rules.

1. be rich
2. write the rules
3. own the lawyers.