| Nvidia / OAI etc. are selling each other product which have a fair market value. They're not moving money around with 'no services rendered'. It does however mean that the situation is 'highly leveraged' - and therefor risk is more concentrated, and, they do disclose. Nominally there's nothing wrong with investing in one's own supply chain. It makes a lot of sense for a value chain player with huge cash position and therefore a lot of power to take a % ownership of a buyer. Consider for a moment - what if Nvida acquired OpenAI? They would be two divisions in the same company. Would anyone consider it wrong for surpluses from one to be invested in the other? No. The moment it's 'managerial accounting' instead of 'balance sheet accounting' - nobody would care. Imagine Google or AWS acquired Nvidia - maybe in 2017 so it would seem more realistic in terms of price - would any of this seem financially dubious? No. Of course - those mega mergers would be bad for competition, but that's a separate question. There's nothing inherently wrong going on here, as long as it's on the books and people understand the inherent structural risk of coupling etc.. |