The Ledger, every show

“It's wrong to say, for better or worse, we're going to be putting in a trillion, therefore I need a hundred trillion out of this. That's not the way investors are looking at this, and it's, and it will lead you down the wrong path if you take that approach, be…”

“You have to see around a hundred million fold growth over the next six years in terms of tokens. Is it possible? Absolutely. It's possible. Is it likely? No, it's not likely, but it could happen.”

“The convergence means that the model differences while there are so minimal as I can't tell the difference in the kind of Pepsi Coke phenomenon, which again, to cut to the investment chase suggests that the competition then becomes much more about marketing ex…”

“We've created this reflexivity. We're now, we justify overspending on the basis of prior overspending having worked out. Well, in prior episodes where that happened, people were not justifying the overspending by saying, say, in rural electrification, you know…”

“Investors that I've talked to are very cynical, so they're perfectly happy to use that in front of their own LPs, but they don't believe that in house. They look at this very cynically and with very cold calculating eyes and compare it to other similar real es…”

“So much of the improvement we've seen in the last 18 months has really been about the imposition of harnesses, effective nannies, sitting on top of bratty kids, and not about the actual structural improvements in the models themselves, and that's a sort of a h…”

“Like a power dam. I don't know who, I don't know where they are or who they are, but I guess they exist and they'll earn utility-like rates of return.”

“As I said, we're now larger than everything except for World War II rearmament, which doesn't play as well in Germany as it does everywhere else. But nevertheless, so the point being that as a percentage of GDP, as a percentage of non-residential fixed investm…”

“As of the second quarter of twenty-twenty-six, this is now more than 50% of the funding for data centers is, is external financing, which is obviously the term of art for off balance sheet and out of your own cash flows”

“The way that I try to analogize this loosely, and this is very loose, is that data centers from the context of many capital providers are real estate. They're really just multi-tenant apartment buildings. It just so happens there's no humans in the apartment b…”

“And these tokens are among the most rapidly depreciating assets we've ever seen in a modern economy, that they've continually been falling 70 to 80% year over year on a constant performance basis for at least the last four years.”

“While models are still improving, they're improving at a much slower rate. And I often do this kind of Pepsi Coke test where I'll put a couple of different models in front of people using some kind of a harness like open code and ask them to tell the differenc…”

“There's a deep misunderstanding about why companies buy software. It's not because they think service now or Salesforce or whoever is somehow, you know, bold innovators that could not be replaced. No, it's because they have a problem. They don't want to build …”

“Increasingly some of the largest purchasers of data center related debt or insurance companies.”

“Once you're managing hundreds of billions of dollars, you start looking at opportunities, not in terms of their economic value, but in terms of check size. And you say, I need to write a check for fill in the blank, a hundred billion dollars, because I do not …”

“The largest bubbles in US history usually had either to do with technology loose credit, government policy, right? Some combination of these things. The US in particular is very good at ones that also include real estate, so we can add that to the mix. So tech…”

“Once investors look under the hood and see more and more of this, they'll be questioning, why are we spending so much on pre-training? Why are you doing billion dollar training runs anymore? If most of the gains and models are coming from post training and RLH…”

“I expect you'll see the same phenomenon, albeit with a little less social consequences once all of this turns out to be, it'll be much like what happened with their overbuilding in apartment buildings and residential and industrial space over the last decade.”

“Tech is now the largest piece of the high yield bond market. It's now the largest piece outside of financial services of the high of the, Investment grade, bond market, so in terms of new issuance”

“And so people are realizing that they're in it even by holding an S&P 500 index fund because of the concentration of hyperscaler and AI related names, which is something like 40 odd percent now.”

“This is a project that would require wholesale replacement of most of the hardware and probably changes in the cooling system and probably changes in other aspects of these data centers continuously and probably, you know, depending on the math, anywhere from …”

“So we have some GPUs that are failing inside of modern data centers on an 18 month cycle, some that are failing on a much longer period.”

“The failure rates of GPUs used so intensively for training purposes are much higher than inference specific usage.”

“I'm very loathe to invent, to commit any, haven't committed new capital to any sort of broad index class passive categories in over two years for that reason.”

“And so the Chinese premier has been recently cautioning the provincial governors, stop building so many data centers because this is now the new thing.”