deathmtn

The Big-Tech giants are insanely profitable but they don’t have enough money lying around to build the hundreds of billions of dollars worth of data centers the AI prophets say we’re going to need. Which shouldn’t be a problem; investors would line up to lend them as much as they want, because they’re pretty sure they’re going to get it back, plus interest.

But apparently they don’t want to borrow the money and have the debts on their balance sheet. So they’re setting up “Special Purpose Vehicles”, synthetic companies that are going to build and own the data centers; the Big Techs promise to pay to use them, whether or not genAI pans out and whether or not the data centers become operational. Somehow, this doesn’t count as “debt”.

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If the genAI fanpholks are right, all the debt-only-don’t-call-it-that will be covered by profits and everyone can sleep sound. Only it won’t. Thus, either the debts will apply a meat-axe to Big Tech profits, or (like 2008) somehow they won’t be paid back. If whoever’s going to bite the dust is “too big to fail”, the money has to come from… somewhere? Taxpayers? Pension funds? Insurance companies?