[etempleton]

I think the earnings are suspect and exaggerated. Hardware manufacturers are making real money now, but there is a big question if any of these AI companies can deliver profitability to match their current valuation let alone future valuations when they go public.

Hyperscalers are in big trouble if the build out suddenly stalls. Even Nvidia and Micron are going to see their value significantly trimmed if it looks like growth is stalling. With such concentration at the top of the S&P among tech companies and with SpaceX, Anthropic, and Open AI, three companies that probably burn a combined 50+ billion a year. The whole stock market will be a tinderbox.

The whole thing is so private capital can get their exit. Default rates of private capital are already at 6%. Banks are exposed so they are on board with the fraud.

[lossyalgo]

> Hyperscalers are in big trouble if the build out suddenly stalls.

How would you define stalled? Hardly anything has been built in the last 2 years (and most of those juicy new GPUs must be sitting in a warehouse somewhere waiting to be installed, together with all of our RAM and HDDs).

[etempleton]

The checks stop being written.

[riffraff]

but google, meta, microsoft and amazon were making a ton of money even before the AI boom.

OpenAI and Anthropic's can go bust, but ads, windows and cloud hosting would still make a ton of money without them.

[etempleton]

But the stock market is not priced for what is happening. It is priced for what investors think will happen. And investors think companies are going to make a lot of profit in the next 3-5 years from AI. If investors lose confidence it will happen those stocks could see a 20 - 40 percent pull back. The companies will obviously be fine, but the stock will take a beating.