AI CapEx

“We are spending in AI CapEx just among the hyperscalers Six hundred and eighty eight billion dollars this year. On the other hand, and that's how it takes to make AI. Think of that as all the money, I'm very simplistic, all the money going in to just make AI h…”

“The stunning thing is it takes until 2031 or 2032 before The revenue from those two companies surpasses the total capex.”

“Overhyped, overfrothed and I believe this AI CapEx bubble will end badly.”

“People, like, I was talking to someone, they're like, why doesn't the government just have, just get someone to make their own model? It's like, because it's, like, you talk about government contracts, we're, like, single digit billions. We're talking about fo…”

“And over the next several years you know, that scales to trillions of dollars, right?”

“This is, you know, billions to trillions of dollars of CapEx, and just using equity dollars alone is not an efficient way to scale this. That's obviously massive dilution, you know, there's, it's not an easy problem to solve.”

“Now in AI we're investing, like, three percent or four percent. It's like, it's not even yet on the scale of the industrial revolution.”

“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…”

“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”

“That's representing at least a couple percent of GDP growth right now. That's driving massive investment in infrastructure and chip manufacturing and energy and all of these things.”

“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.”

“AI CapEx is one percent of GDP.”

“AI capex is, you know, over one percent of GDP.”

“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.”

“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.”

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

“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.”

“We estimate that that is approximately one percent of GDP a year. So, three hundred billion dollars. That's being spent on AI.”

“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?”

“The logic suggests that yes, we can shave off a lot of inefficiency, a lot of increased economic value tremendously, which should justify this desire to invest in democratizing intelligence, which should justify the fact that once this democratized intelligenc…”

“It's important. Like, it's not going to all be, you know, Silicon Valley VC firms as they scale.”

“I mean, if they're spending two hundred and fifty billion dollars a year on CapEx associated with AI, that is emperor level spending.”

“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.”

“And Satya very quickly said, this is a supply driven wave. And I think up to date that is true. We're building ahead of demand.”