FPGAs are widely used in low latency trading. Most market data feed handlers and order passing adapters are done in FPGAs today - they offer better latency than software solutions and processing time is deterministic.
I think the quote from the Polish Prime Minister refusing very similar German demands just before WW2 started is appropriated here:
“Peace is a precious and a desirable thing. Our generation, bloodied in wars, certainly deserves peace. But peace, like almost all things of this world, has its price, a high but a measurable one. We in Poland do not know the concept of peace at any price. There is only one thing in the lives of men, nations and countries that is without price. That thing is honor.”
As it turned out, Poland paid a very heavy price. But we're damn proud of it.
100%. The first version of Trump as a president was a clown that was being managed by responsible people, mostly.
The second time however, he learned his lesson. He's still a clown but he put his people, ranked by loyalty above anything else, in all key position. They are all knee deep in probably the most obvious and manifest corruption we've ever seen in a Western country. They won't oppose him in any way unless they are sure he's dead or gone forever.
One must love the projections of >50% YOY growth for 5 straight years.
Why not continue for the next 5 ? Maybe they will find customers on Mars.
This while situation is very strange - there are some big companies pouring tens of billions into it (Alphabet, Meta) - since they don't have anything better to do with the money printers they have, but there are several others whose valuations are based on completely unrealistic projections where their expected revenues in 5-10 years represent 99% of their current 'value'.
Traditionally one is supposed to return money you don’t have anything better to do with to shareholders in dividends, but that is sadly out of fashion with tech companies.
A dividend is one mechanism for financial rigor and focus, since shareholders don't like dividends being cut. Having large piles of cash lying around is a temptation to use it for sub-optimal returns, or even worse, empire-building.
Another reason is that the shareholder functions more like an owner. Without a dividend the managers have a less clear responsibility to the shareholders. Maybe they act wisely, maybe not, but there is no real constraints on their behavior. The stock then acts more like a lottery ticket than owning a business, because you don't get anything out until you sell. Whereas, if the company pays you something because you own shares and therefore you own a piece of the profits, the ownership structure and the management structures line up better.
"If you are old enough, or possessed of a certain kind of disposition, you may be thinking, Wait a minute, aren’t you describing Enron? And uh, in some sense, yes! Enron’s whole thing was special purpose vehicles with extremely speculative valuations that were used to take on debt, Luria notes. But Enron lied about what it was doing, and that’s fraud and illegal. (It also got up to other illegal stuff besides.) Nvidia’s relationship with CoreWeave is all happening in plain sight. So are all the relationships with the other neocloud companies. It kind of seems like the tech company version of the GameStop open pump-and-dump."
To answer your question - not unique to AI spending boom - this kind of things was right there for recent major bubbles.
So is this just a hallmark of bubbles in general? They have to start getting silly with the debt financing so they load up SPVs to protect their assets and saddle others with the inevitable losses while they cash out?
I don’t understand how anyone could make this trade. There is no way coreweave outruns those debt obligations…
It’s an extreme case of “fake it till you make it.” They seem to believe they just need to keep the operation afloat until AGI magically appears. Increasingly, it’s clear that neither LLMs nor transformer architectures are going to get them there. That’s likely why many of the original engineers distanced themselves and are looking for new architectures now. Nobody wants their name tied to this fallout when reality lands. I truly believe we will need another tock for our compute backbone and that a lot of the hasty accumulated hardware we see now will be garbage in just a few years. It's true insanity.
There was, at least towards the end. FED chair at the time described it as 'irrational exuberance'. Warren Buffett made an excellent speech in front of most Silicon Valley titans at the time - telling them that their wealth is about to be blown up.
This isn't rocket science - do anybody sane believe that OpenAI will spend what, 1.5 Trillion $ they project ? Quite a big chunck of Oracle, Nvidia and others projections are based on this 1.5 Trillion $. They are loosing money and their revenue is 1% of this figure.
Warnings today are mainstream and widely understood, unlike late‑90s dot-coms where Buffett was largely ignored. Buffett explicitly says he doesn't invest in complicated businesses, finances aside. Plus, core AI players are profitable and funding capex from real earnings, valuations are concentrated in a few mega-caps, revenues are real, and financing is healthier. So while parts of AI may be overvalued, it’s structurally very different from the 1999 bubble.
And is it really overvalued if AGI is achieved? Sounds like risk:reward profile is already priced in the gamble, and the valuation is appropriate....But I guess if you take it to the logical conclusion... if AGI is achieved, everyone will be out of a job, so scarcity-based economics, based on scarce labor input, itself will have to be redone. Wild speculation there.
Warren Buffett is buying Alphabet out of neceessity - he already sold most of what he could sell and has way too much cash on hand - he just need to buy 'something' - Alphabet seems like the least overvalued big stock out there.
Berkshire is sitting on nearly $350 billion in cash. One of the ratio's that Buffet uses to measure overvaluation, Wilshire 2000 Market Cap as a % of GDP is at an all time, 220%. Its usually a good indicator of a market top. He's making a few small investments, but he's just waiting until there's more of sell off before heading back in. He's under no pressure to buy anything.
Is he required to buy stock? AFAIK he could just as well hold cash or bonds, and if he believes a bubble pop is imminent (within the next couple months), that would be a responsible move.
Not required of course. This move to finally move some of his cash horde into equities could be a result of the US governments recent announcement that they're ending their quantitative tightening policy. This likely signals a move back to a period of quantitative easing which could cause assets to continue to inflate while the value of the dollar continues to erode.
Basically he could just be trying to protect the value of his dollars by putting them into a very stable company that also has exposure to the upside of AI.
Probably a stupid question, why not buy something like CHF then, if one is concerned about eroding dollar value? Is the thesis that blue chips (if google is one) would rise faster than USD is devalued?
Stocks are going to be better at hedging against inflation than any one specific currency, because they’re able to raise prices. This is something Buffet has talked about which is mildly detailed here: https://www.investopedia.com/how-warren-buffetts-1-rule-can-...
How the dollar erodes, and its effect on other currencies will be unpredictable. Corporations raising prices to offset their rise in costs, is predictable. It’s just a matter of finding those corporations and industries which can do so without losing more sales.
I’d assume the urge to “cash up” here is driven by the idea of trying to sell the top, and buy the resulting bottom. I highly doubt Thiel thinks AI isn’t worth today’s market cap or several multiples of it, in the long term, and that any “bubble burst” will likely be a generational buying opportunity.
That sort of crash is what central banks exist to protect against. That could be something like the Fed stepping in as a buyer of last resort and picking up several trillion dollars of equity, and/or pushing rates to zero again to incentivize private capital to more or less do the same.
A global crash of financial systems is unlikely because it’s cause too much pain for everyone. It unfortunately means we plebs are likely the ones paying to bail it out.
Frankly, I would be happy if riots in the streets happen (if there is a bailout of Big Tech in the first place). What's going on recently with OpenAI publicly, and probably most of the 'AI' players not publicly, is disgusting - it's a bubble, everyone and their mother knows it, and these guys try to save their asses by asking for governement backing before the bubble even pops. Privatize gains, socialize losses...
It's a shame that no more bankers went to jail after 2008, although I find the situation was much more complicated than here.
Oh, don't get me wrong, if and when this happens, I'll join the riots.
And I'm not even anti-AI; I genuinely believe that, as a technology, it is a major advancement that can and should be put to so many good uses. Which is emphatically not what the people in charge are doing.
Their own internet megaconstellation, called Project Kuiper until earlier today when they renamed it to Project Leo.
It's actually the current biggest commercial launch customer, Starlink is internal to SpaceX, but Kuiper/Leo has bought many launches with ULA, SpaceX and Arianespace (and Blue Origin, of course).
Even if you exclude Starlink SpaceX is overwhelmingly dominant. The stuff they don't launch is mostly China and Russia and Europe they can't compete for.
Starlink prints money, SpaceX is absolutely launch mass constrained right now. They literally spent $17 billion on spectrum to make Starlink better and more efficient because of how constrained they are on the launch side until Starship is fully operational and reusable, which may not be until 2027 even for Starlink launches.
This show was really ahead of its time. "If you show revenue people will ask how much and it will never be enough" /s Imaginary trillions of revenues from Optimus are definitely much more appealing.
I truly don't understand US politics I think. MAGA movement cares very much (or is it just optics ?) about family etc, and this Epstein scandal seems to be extremly important to them.
But the problem, and a pretty big one, is that their guy, Trump, was best friend with Esptein for decades and it's very well documented everywhere.
So on one hand they want to release all the files, but on the other one they can't be that stupid and think Trump is not in there ? Or are they so brainwashed by Fox News and influencers propaganda that they don't bother look up some articles from that period ?
- trump is in deep with epstein. Maga cares about that
- trump and bondi said they'd release all files, which Maga wants as does the prepondernce of america.
- trump has no morals or ethics. He thinks he can tell people what they want to hear now then tapdance his way out later. The key reason he has some success here is because congressional Republicans are wussies, benefit from trump short term, are afraid of him. and Republicans are far more disciplined staying on message then dems. Release the files? Trump thinks nothing of saying that but not doing it
- no regaen republican thinks trump gives a damn about family values, church, justice, military values. No one .. not anywhere .. not at anytime.
- US fundamentalist christains (evangelicals, pentacostals) are benefitting from his culture warfare short-term. But when music stops it'll be clear they just used each other.
- as far as theology goes the Christian theology is way more flexible, bend to need than Catholics, or those for who the old testament is their book. Evangelical christains take this inch and make it a light year.
(I was raised Evangelical but quit as a kid, have lots of military in the family, and share several members who are regaen Republicans repulsed by trump. Trump is radioactive skank on parade.)
Predating Trump’s first term, the fringe right had conspiracy theories about elite child trafficking rings and those increasingly became part of the Republican mainstream as they proved a useful rallying point against Clinton (targeting her husband) and as an explanation for what motivated the “deep state” bogeyman used to explain every failure. That’s long enough ago that there are Republican members of Congress who rose to that level by beating more moderate Republican incumbents.
Trying to reverse that is a political minefield after they spent a decade and many millions of dollars pumping up the idea that there’s a massive conspiracy among the political elites. They spent basically Biden’s entire presidency saying he was helping the coverup to boost Trump’s election, but I think his people were hoping enough people would lose interest and they could quietly drop it with some stunt like Bondi’s empty binders. This is the first time they’re more or less publicly recognizing that Trump doesn’t entirely control the MAGA agenda.
One example of a company offering something like that: https://www.enyx.com/
It highly depends on what you're doing, but in trading there is very often a direct reliationship between latency and how much money you can make.
reply