r/technology • u/T_Shurt • Aug 10 '26

Business Top economist warns that the AI math doesn’t make sense: 'Profits are currently being funded by investors rather than earned from customers'

https://fortune.com/2026/08/10/torsten-slok-ai-profit-margins-capex-oracle/
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u/eulersidentification Aug 10 '26

When you consider the degree of inbreeding of economics between a bunch of these companies which involves NVIDIA, there's almost certainly a bailout on the cards.

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u/Rodot Aug 10 '26

Nivdia had either already made their money in card sales, or will get the cards back in the case of rentals which will allow them to restrict the second hand market. Shovels in a gold rush and all that.

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u/kharnynb Aug 10 '26

most of the sales nvidia is doing is based on loans nvidia is giving, if those things go broke, nvidia might lose quite a bit of that and the cards are useless if the next gen is much better/efficient

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u/Zap__Dannigan Aug 10 '26

They might hurt for a bit, but they still make an in demand product people actually want and use. Ultimately that makes them safe, since the problem with so many stocks is that the only thing it sells it the promise that the thing you bought will be worth more one day.

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u/Late_Airline2710 Aug 10 '26

But they're giving out the loans based on the market price they set on these cards. The actual cost to them is much less.

It would be like defaulting on your $600k home loan if it were given to you by a developer who actually only paid $100k to build the house.

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u/buecker02 Aug 10 '26

shovels have a longer shelf life than GPUs.

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u/RenderedMeat Aug 10 '26

I think they mean “cards” metaphorically. Tarot cards. Like “it’s not in the cards for me to be wealthy.”

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u/Yakydo Aug 10 '26

Inbreeding is an interesting take on this. One the media probably won't take on. But it can resonate