The headline invites the reader to think these liabilities are concealed from investors, but they're not. Deeper in the article it talks about how credit-rating agencies explicitly includes in their modeling.
The guarantee allows lenders to behave partly as though they're lending to NVIDIA, Meta or Broadcom rather than to an AI startup or single-purpose data-center company.
The interesting question isn't "Is the debt hidden?" (it isn't), but is who ultimately owns the downside risk of the AI infra boom?
More interesting headline would be "Big Tech is using its creditworthiness to finance the AI boom without taking on equivalent amounts of direct debt."
Why are people such big opponents of the AI buildout?
I generally don't see many cons to it.
1. Big tech was just using profits to buy back shares before AI build out. Would you rather they buy back shares with their profits or finance the AI build out?
2. If there is an AI bubble, great, when it pops, we'll all have ultra cheap tokens and we'll have all these amazing AI infrastructure built for the next wave of innovation.
3. Even if AI progress stops here and models hit a wall in intelligence, we'll still have AI good enough to solve millennium problems.
My theories on why people are so anti-AI:
1. It threatens their jobs.
2. They want AI stocks to drop so they can buy the dip.
3. Their identity is being challenged because AI makes what they do easier.
We don't have enough energy production for massive AI buildouts. New energy capacity will not come online fast. National and regional grids will be stressed contributing to impacts on populations and industries. New energy capacity will be expensive and if carbon-intensive will accelerate climate breakdown. Additionally at current fossil fuel prices, energy prices (will) rise dramatically.
Currently planned locations for buildouts are suboptimal at best, horrible at worst and vehemently opposed by local populations. That could be NIMBYISM, but in this case it's probably justified: who would want a noisy, ugly-looking grey cube raising electricity prices near their house?
And that's just one angle. There are many more. Nothing to do with "AI will take our jobs", that's a pretty low-effort justification/theory.
That on its own would be a good incentive for the AI bubble to pop ;-)
As others have pointed out though, I'd be keen to see how much of it is gas turbines.
I'm also not convinced that energy buildouts are seeing as much interest and by the time they come online prices will already have skyrocketed (that is, after the current skyrocketing).
We are building more dirty fossil fuel energy to keep up with AI demands. When the solar build out is further along, and the grid is updated, it will be more acceptable to be using so much energy. Spinning up a bunch of new gas powered plants because they want to move too fast is terrible
To me its not just about AI, but how they utilize all this financial scenarios to push things absolutely over the top, e.g. fast inclusion into indexes and essentially funding bubble from people's 401k.
1) i write code for a living. Without the tool. I have never been impressed by the tools and don't want to use them for work because i know my brain will rot pretty fast, pretty soon. Amused, sure, but they are still stupid by large. Useful idiot remain a useful idiot even if it appears smarte. My boss shows me some cool shit he experimented with all the time, only to have the thing redone from scratch every other week. Still useful, still a mess, still requiring competent people to keep the castle from crumbling. And you can't get competent people without having them do the hard work.
2) i want them to fail and disappear forever. Let open models stay. Let the VC fuckers starve to death before they use MY retirement fund without my consent because they bribe regulator to include them in protected indexes even if they have not followed the process, just because they are the future and too big, trust me bro
3) fuck me if i identify myself with my job, and only my job.
You don't see the cons because you refuse to see or hear. You refuse to actually engage with any of the complaints and examples people show you. You're deluding yourself and thinking that somehow everyone else is the problem and you're the only sane one in the room.
1. Because resources (land and water) are limited and build-out crawls the resources from the more important (even vital) affairs.
2. Because there is still no convincing way how AI giants would make profit. Whatever impressive and useful tricks the stochastic parrot is able to do will never pay back enough to make a breakeven.
3. Because AI giant CEOs are a bunch of galactic-scale douchebags who keep saying "this is far too powerful for a mere mortal, but as long as we hold this power it's okay" with a straight face while presenting us with the stochastic parrot. No, seriously, I'm very impressed. Someone actively subverting the tech narrative couldn't do a better job.
1. We waste a lot of land and water on many less productive things. For example, building massive golf courses that need acres of land and water. What is the threshold for you?
2. Personally, I think the people who say LLMs are stochastic parrots are themselves stochastic parrots. They heard this term from someone online once and now they keep repeating it. Anyways, I’d love to see your math on why you think AI can’t make a profit.
3. You must be new to tech if you think it’s only AI. Many tech CEOs have always been out of touch. I personally don’t care too much about the CEOs. If AI CEOs had better PR, would you be less anti AI?
Golf courses are stupid too, but the scale is nowhere close. The difference is that new golf courses are not financed by an too-big-to-fail infinite money glitch, so they are limited by how many people are willing to spend their money building golf courses.
> If AI CEOs had better PR, would you be less anti AI?
I'm not against AI. I'm against companies blowing up a bubble. Notice that the question "is it a bubble" is orthogonal to "is it useful".
> why you think AI can’t make a profit.
AI can make a profit - in niches. Automatic translation. Mathematic proofs - but yes math is more than proofs and there never were much money there. Maybe code generation in some cases, but I don't see "programmers becoming obsolete" any time soon - spewing out code was never the problem for me, domain knowledge was and still is. And yes, all that doesn't make it any less of a stochastic parrot. A useful parrot, but still a parrot.
But OpenAI and Antropic can't generate the profits they promise at the scale they need to break even. Because
a. Most of their use cases yet demonstrated are self-defeating. Text generation is useless once everyone hates slop and long texts stops becoming a useful signal. The whole story is basically "I can generate infinite gold, I'm now can buy anything". No, your gold is now worth very little. And everyone whose pay was indexed in gold is now fucked too.
b. They have no real moat aside from loads of money. Their entire plan is "growing too big to fail, then engage regulatory capture." And people engaging in in regulatory capture deserve nothing but slow and painful death. Not that it would work anyway, we've got China fixing that, for better or worse.
People are scared about their future and don't think AI is going to make things better. And who could blame them? A movie that doesn't have any conflict and ends with everyone being happy and everything is nice isn't going to sell a lot of tickets. So we get endless variations of AI is going to kill us and doom humanity. That is the backdrop against which real life AI that's actually happening and is here today has to compete with. If I was in the horse carriage industry when the car came out, I would be up in arms about it as well. The people are scared, and rightly so. If I don't have a job, because they don't need me, because AI can do it, then how do I pay my rent or for food? If we lived in a world where we treated poor people well, and they're just down on their luck, they just need a helping hand that we're happy to give. Then the coming jobpocalypse wouldn't be so scary, and people wouldn't be so up in arms against AI. We only have to look at the history of coal miners to realize that there's no one coming to save us though.
I think people here have stated a variety of reasons. Many go at it from an economics standpoint saying they are anti-AI because they don't think AI will make a profit because it isn't/won't be that smart.
Yet, you are saying something complete opposite. You're saying that AI could become so smart that it makes many people unemployable.
I think your reason is completely different than just about everyone's here. I think it's more honest. I think people here who hate AI for different reasons actually have the same fear inside but they don't want to admit it for some reason.
I agree, I use LLMs all day to build my business, to run my business, etc. I follow as much AI news and developments as I can. I play with as many of the tools as I can. I listen to interviews with the leading researchers at the big labs and what they think, what they're worried about, etc.
I'm blown away by what I'm able to accomplish today that I could not have just three years ago. I'm also quite worried about the societal impact of where all this is going.
Most of the AI hater arguments genuinely sound more motivated by fear at their core than any kind of rationality. The people I respect who are concerned about AI risk do not make the wildly exaggerated and emotional claims that I see constantly on HN. It's hard not to conclude that people's fear is driving them.
Yes, agreed. I think just about everyone who replied to my post said something else other than personal fear, but I think personal fear is the primary reason. They just won't admit it.
> 1. Big tech was just using profits to buy back shares before AI build out. Would you rather they buy back shares with their profits or finance the AI build out?
This statement is factually wrong. AI isn't financed by profits, it's financed by debt - the "$300B AI exposure off balance sheets" in the title refers to debt. The buy-back grift isn't legit either, but it's not as a damaging as the AI buildout.
> My theories on why people are so anti-AI: 1,2,3
Wrong theory again. The sky-high AI debt causes inflation, asset extraction and market scalping by front-running it. The opportunity cost prevents the rest of the economy from allocating capital to competing ventures and from increasing capacity - part of the reason for inflation.
That's what an honest economics analysis would tell you.
> 2. If there is an AI bubble, great, when it pops, we'll all have ultra cheap tokens
Wrong again. We already have ultra-cheap tokens from China but the bubble continues unimpeded, feeds on inflation and if that's not enough, bailouts are certain. Inflation is a way to silently pop the bubble at the expense of consumers leaving the perpetrators whole, that's where it's all going.
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[ 0.24 ms ] story [ 39.0 ms ] threadThe guarantee allows lenders to behave partly as though they're lending to NVIDIA, Meta or Broadcom rather than to an AI startup or single-purpose data-center company.
The interesting question isn't "Is the debt hidden?" (it isn't), but is who ultimately owns the downside risk of the AI infra boom?
More interesting headline would be "Big Tech is using its creditworthiness to finance the AI boom without taking on equivalent amounts of direct debt."
The US taxpayer for the inevitable corporate bailouts.
tell us more.
what informs your prediction?
I generally don't see many cons to it.
1. Big tech was just using profits to buy back shares before AI build out. Would you rather they buy back shares with their profits or finance the AI build out?
2. If there is an AI bubble, great, when it pops, we'll all have ultra cheap tokens and we'll have all these amazing AI infrastructure built for the next wave of innovation.
3. Even if AI progress stops here and models hit a wall in intelligence, we'll still have AI good enough to solve millennium problems.
My theories on why people are so anti-AI:
1. It threatens their jobs.
2. They want AI stocks to drop so they can buy the dip.
3. Their identity is being challenged because AI makes what they do easier.
Also, since AI demand is so high, what do you suggest we do? Not do the buildout and just let people fight over tiny capacity?
You’re progressively entering the delusional territory.
2) i want them to fail and disappear forever. Let open models stay. Let the VC fuckers starve to death before they use MY retirement fund without my consent because they bribe regulator to include them in protected indexes even if they have not followed the process, just because they are the future and too big, trust me bro
3) fuck me if i identify myself with my job, and only my job.
You should really reevaluate your perspectives .
But instead of attacking me, why don’t you engage with me.
2. Because there is still no convincing way how AI giants would make profit. Whatever impressive and useful tricks the stochastic parrot is able to do will never pay back enough to make a breakeven.
3. Because AI giant CEOs are a bunch of galactic-scale douchebags who keep saying "this is far too powerful for a mere mortal, but as long as we hold this power it's okay" with a straight face while presenting us with the stochastic parrot. No, seriously, I'm very impressed. Someone actively subverting the tech narrative couldn't do a better job.
2. Personally, I think the people who say LLMs are stochastic parrots are themselves stochastic parrots. They heard this term from someone online once and now they keep repeating it. Anyways, I’d love to see your math on why you think AI can’t make a profit.
3. You must be new to tech if you think it’s only AI. Many tech CEOs have always been out of touch. I personally don’t care too much about the CEOs. If AI CEOs had better PR, would you be less anti AI?
Golf courses are stupid too, but the scale is nowhere close. The difference is that new golf courses are not financed by an too-big-to-fail infinite money glitch, so they are limited by how many people are willing to spend their money building golf courses.
> If AI CEOs had better PR, would you be less anti AI?
I'm not against AI. I'm against companies blowing up a bubble. Notice that the question "is it a bubble" is orthogonal to "is it useful".
> why you think AI can’t make a profit.
AI can make a profit - in niches. Automatic translation. Mathematic proofs - but yes math is more than proofs and there never were much money there. Maybe code generation in some cases, but I don't see "programmers becoming obsolete" any time soon - spewing out code was never the problem for me, domain knowledge was and still is. And yes, all that doesn't make it any less of a stochastic parrot. A useful parrot, but still a parrot.
But OpenAI and Antropic can't generate the profits they promise at the scale they need to break even. Because
a. Most of their use cases yet demonstrated are self-defeating. Text generation is useless once everyone hates slop and long texts stops becoming a useful signal. The whole story is basically "I can generate infinite gold, I'm now can buy anything". No, your gold is now worth very little. And everyone whose pay was indexed in gold is now fucked too.
b. They have no real moat aside from loads of money. Their entire plan is "growing too big to fail, then engage regulatory capture." And people engaging in in regulatory capture deserve nothing but slow and painful death. Not that it would work anyway, we've got China fixing that, for better or worse.
They are moving too fast and using too much dirty energy
They are committing crimes to trick people into thinking they've created god
None of your three theories are correct at all
I think people here have stated a variety of reasons. Many go at it from an economics standpoint saying they are anti-AI because they don't think AI will make a profit because it isn't/won't be that smart.
Yet, you are saying something complete opposite. You're saying that AI could become so smart that it makes many people unemployable.
I think your reason is completely different than just about everyone's here. I think it's more honest. I think people here who hate AI for different reasons actually have the same fear inside but they don't want to admit it for some reason.
I'm blown away by what I'm able to accomplish today that I could not have just three years ago. I'm also quite worried about the societal impact of where all this is going.
Most of the AI hater arguments genuinely sound more motivated by fear at their core than any kind of rationality. The people I respect who are concerned about AI risk do not make the wildly exaggerated and emotional claims that I see constantly on HN. It's hard not to conclude that people's fear is driving them.
This statement is factually wrong. AI isn't financed by profits, it's financed by debt - the "$300B AI exposure off balance sheets" in the title refers to debt. The buy-back grift isn't legit either, but it's not as a damaging as the AI buildout.
> My theories on why people are so anti-AI: 1,2,3
Wrong theory again. The sky-high AI debt causes inflation, asset extraction and market scalping by front-running it. The opportunity cost prevents the rest of the economy from allocating capital to competing ventures and from increasing capacity - part of the reason for inflation.
That's what an honest economics analysis would tell you.
> 2. If there is an AI bubble, great, when it pops, we'll all have ultra cheap tokens
Wrong again. We already have ultra-cheap tokens from China but the bubble continues unimpeded, feeds on inflation and if that's not enough, bailouts are certain. Inflation is a way to silently pop the bubble at the expense of consumers leaving the perpetrators whole, that's where it's all going.