AI CapEx

“Believing in AI and believing that infinite capex in the next two years, those are very different concepts. You can believe in AI, but also believe that the amount of capex in the next 24 months may be difficult to pay back.”

“At some point in the process, you will, we will become over invested because that's just what humans do when faced with this kind of opportunity, right?”

“So we're running now at about 1.2% of GDP, which is basically 1.2% of GDP is going into making CapEx data centers, which is a little above the 1.1% of GDP that was going into bandwidth at the top of the 99 2000.”

“I mean, you see the data, almost the entire GDP growth Is AI CapEx.”

“I think I underestimated the impact of A, the scaling laws in AI and B, the ability of primarily Altman and some other folks to inspire belief in those scaling laws and unlock six hundred billion of CapEx spend a year.”

“Which, in my view, it exposes the absurdity of a trillion dollars of capex. You know, it's going to be really hard to cover that nut.”

“Zooming out, I think there's, you look at the AI capex band and you go, at some point this is going to overshoot. And then there's going to be a downturn.”

“The capex is now six hundred billion, the app's revenue, you know, squinting is A hundred billion. So you're still, you know, five hundred billion a year in the hole”

“We don't need the government's help to finance AI, the AI CapEx. The hyperscalers have infinite money. The private markets have had infinite money. The public markets are pretty hot to trot. So all the money these guys need to play their game is going to be th…”