by darth_avocado
15 subcomments
- Well technically they don’t own the debt, the SPVs that own the data centers do. The giants just have long term commitments, but if shit hits the fan, it’s not the tech giants but the banks that lent the money to the SPVs that are at risk. This usually means all of us are on the hook.
- Archive link:
https://archive.ph/20260720174223/https://asia.nikkei.com/bu...
by King-Aaron
7 subcomments
- These debts mean nothing if the US government actually views AI technology as being on par with the Manhattan project. They'll just bail them out or nationalise them.
- On the one hand, these debts may be off the balance sheet, but institutional investors certainly know about them and can reason about the company's valuation. Retail investors may be caught out slightly more.
But on the other hand, these companies are essentially paying for the service of taking the debt off books (by paying the leasing premium to the SPV partners). I guess I'm wondering what they really gain from doing so, if again sophisticated investors can see through the games?
by alwaysanoobie
6 subcomments
- Oh man,this makes my stomach churn with anxiety.
It's a tough job market out there and it took 4 months to land job offers after being laid off.
I have a competitive offer from Oracle OCI with a team adjacent to this initiative and I am seriously considering it. How long do you guys think it will take to blow up (if it does)
To the experienced devs out there; would you take a 15% less offer from a medium sized company for job security?
- To quote the Big short: "I have five houses and a condo."
- The banks are not the ones on the hook here - they no longer lend in a meaningful way as first loss lender on many things. If they lend they do so as a senior financing provider to vehicles that provide the financing.
The actual lending is done by private credit institutions that have raised money, sometimes on the order of 10s of billions of $.
by NoboruWataya
1 subcomments
- "hidden" debts and "opaque" funding I seem to read about every other day.
- It's hard not to be fatalistic about all of this now: In my mind, it's crystal clear that the investments will never be paid back. The revenue streams from all the companies involved don't add up. It must fail at this point.
That means losses. Big losses for some.
I assume that these off-the-books companies can quite literally be pinched off and the debt becomes the banks' problem, so the primary company, i.e. Meta, Oracle, can walk away but the banks will be left holding the bag.
We know what happened the last time the banks played their stupid games!
- The whole world's wealth is being siphoned off by these companies. I hope the very probable crash does not happen.
by waterTanuki
0 subcomment
- So this is why Masayoshi Son was lashing out at critics recently.
- A bubble in progress waiting for right time (hello 2028) to burst.
- That doesn't sound good, but out of curiosity: How do you exactly hide debt? Circular economy is easy to understand, but what else is cooking?
- The 5 horse men of the AIpocalypse.
But this reminds me of 2008. Because when it goes all wrong, the US government is just going to bail them out just like they did with the banks to just keep the scam going.
Because after all, they will be treated as "too big to fail".
by andrewstuart
0 subcomment
- Pretty sure Tim Apple can flip open his wallet and pick up the tab for everyone, if he’s feeling generous.
- https://archive.ph/lOlv5
- Imagine shorting Alphabet stock now , just before the AI bubble bursts, what an opportunity of a lifetime.
Hacker News