This isn't a bubble
This isn't a bubble
Comments
83-
-
AMD too?
So, assuming that Intel is also on the wrong side of history as usual (and that their cards are actually good for gaming, of which I'm not convinced) , you literally can't buy a decent gaming GPU without paying into the AI nonsense?
-
Nope sadly, AI needs GPUs and it makes up the bulk of sales of these chips now.
It would be suicide for any of the companies that could make these processors to not go after the biggest market. The result of a company not doing that would be watching all their competitors grow and advance their products whilst their company's value drops and products stagnate, possibly to a point that recovery to competitiveness would be hard if not impossible.
-
When AMD's biggest market was Litecoin (and derivatives like Dogecoin) mining and Nvidia's hardware was pants at mining, they initially couldn't increase production of the HD 7000 series quickly enough, so the initial glut of money went to scalpers. They responded by making huge volumes for the Rx 200 series, but shortly after it launched, Litecoin mining ASICs became available and GPU mining stopped being viable. That meant that:
- they'd spent lots of money manufacturing lots of GPUs.
- miners were selling used GPUs for a fraction of the retail cost while those cards were still the current generation.
- people didn't want to buy a new card for several times the price of the same card but used for a few months.
- retailers had to drop prices to keep selling new cards.
- wholesale prices had to drop to keep retailers stocking new cards.
- AMD weren't making any profit when they sold these cards.
- the RX 300 cards weren't compelling compared to a massively discounted RX 200 card, so they didn't sell in huge quantities or with good margins, either.
This wasn't the only time ATi/AMD took a calculated risk and it backfired horribly, so with their history of bad luck, chasing the AI bubble in any way that involves risk instead of just selling things for money might be a bad idea.
-
-
Look, the recent CPU lineup had AI in its name, has dedicated cores in it. Because Windows wants to do AI things or whatever.
-
its
-
-
Intels main focus with their GPUs has been AI workloads. I have an Arc A770 I don’t use because while it works great for LLMs and shit, it doesn’t run the games I want it for. 🙃
-
they're all playing the same game
-
-
So basically they're paying in exposure.
There's a mildly amusing bit in there about disrespecting artists and not wanting to pay them money for their work that I'm not a good enough writer to execute (guess I should've asked chatgpt to do that for me and posted the result as my own original work do not steal instead of this nonsense ramble).
-
If they say they are gong to pay artists the stock will not go up
-
Isn't this basically a kind of insider trading? They wouldn't be allowed to buy that stock, knowing that this deal is about to happen, but receiving it as part of the deal is okay? That doesn't feel right to me.
-
Nah, they are rich so it should be fine.
-
Any deal involving whole percentages of stock will affect the stock price, it's insider trading when you get a call from someone at AMD before the deal is public, so you can profit. It's not insider trading for AMD executives to exercise their stock options (which they already had) to profit from the stock movement they just authorised
-
the SEC does not exist under republican administrations and it only exists to protect rich people under democrat ones, as it has been literally since it was created.
whole goddamn US economy is built around speculation and insider trading trying to get an edge on that speculation
-
Do you think rule of law exists in the US?
-
-
It's going to be a fucking bloodbath when it bursts.
-
It fucking should be. It's been nearly as much an annoyance in my feed as Sovcit Hussein. Death to AI and the bastards trying to shove it down our throats.
-
Assuming it ever bursts.. Do the people in power want the bust?
-
-
NVIDIA's deal makes much more sense. Will use OpenAI revenue to buy shares in OpenAI and still profit if OpenAI goes bankrupt.
This is less a "vote of confidence" in AMD, because shit is free for OpenAI here. I too will buy all the AMD GPUs if you give me AMD stock of same or greater value. This deal structure actually makes AMD look terrible and unconfident in its product. But deal is not transparent enough.
-
Perhaps unconfident in the future demand of their product.
-
That's what I meant, though specs look great, and so "unconfident in execution of future roadmap" or cost/yield issues, but tsmc has history of success in new tech generations. OTOH, Rubin is sticking with 3nm as AMD goes for 2nm on the critical part.
Something is very wrong with this deal. Can know this without knowing any specifics of what's wrong.
-
-
-
You’re paid in exposure.
-
Is this really what happen?
-
Pretty much. OpenAI will "give" AMD 78bln for 10% of the stock and the chips openAI actually wants. This whole ordeal has been publicly paraded like OpenAI and AMD partnering up, which has already pumped up AMD stock price by 45%. Thus openAI will eventually get their 78bln (which they actually never had in the first place) back in AMD stock.
So who actually pays the 78bln? The simple answer is AMD stock holders, currently the ones who have bought the stock after the announcement and later the ones who bought it before it crashed. The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn't dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future. Who knows who is actually paying for it because AMD stocks will get used elsewhere (for example as collateral in a loan) and the economic growth with absorb the costs. In short, we might as well imagine nobody paid for the chips.
In short, brace for another "once in a lifetime" economic crash.
-
This isn't the way economic bubbles are typically structured. At all.
Typical economic bubbles are built on speculative investment leveraging debt until the whole thing reaches a point where the debt can't realistically account for possible growth anymore. This would be OpenAI asking SoftBank for $78B to buy chips that have at most, a maximal 5 year life cycle, and then OpenAI not having cash on hand to pay down that $78B in 2 years.
Using this stock reacharound is actual money changing hands. Yes, stock dividends and sales are part of that, but it's not debt. It's certainly not sustainable, but it's not something that will lead to bankruptcy for OpenAI or NVIDIA or AMD if they fail to turn profits. But the money is real at the time it's moved around. Surprisingly, the LLM crowd has been fairly consistent in not running to highly leveraged debt for funding.
This is a pump and dump scheme if anything, and seems like a great way to find out later that people buying stock in AMD "invested" in shrinking their portfolio over the long term. IMO only a fool would buy stocks that funded this, but it's a slow-mo bubble for those people, not the economy in general.
-
The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn't dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future
The stock market has been a speculative mess where the numbers are made up during my entire lifetime.
-
The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn't dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future.
Drew Carey: Welcome to the stock market, where the points are made up and money loss really matters
-
The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn't dictated by what the company is currently capable of doing but rather what the company potentially could be doing in thue future.
You seem to be under the impression it was ever anything else.
-
Cui bono? The executives who approved the deal will make bank on their stock options
It's never good for a company to have unprofitable decisions made by people for whom the decision is profitable
-
-
-
- Approach a business.
- Request the service or product they provide for free.
- Suggest that instead of paying, you'll advertise the fact that you "bought" from them.
- Argue that your brand is so awesome that associating with it is valuable enough to substitute for the payment.
Isn't this basically what influencers do?
-
Arguably OpenAI has actual influence unlike anyone calling themselves "influencer", but yes
-
The list of publicly traded influencers is very short.
-
I'll pay you with exposure :)
-
Or you know, buy the chips fair and square, buy the stock fair and square, provide a service that's worth something, and make profit from both transactions.
-
You just dont understand business!
/s
-
It is way more work to provide value than it is to bribe the regulators to agree that you provided value.
-
-
Also, make sure to keep secret the actual milestones and share allocations being gifted to OpenAI.
MI450s are expected to be $40k/kw. 6gw would be $240B in revenue. AMD can make MI450 an openAI only product and overcharge them for it. MI451 for everyone else. If price is fixed, MI450 is not finalized, afaik, and so much lower specs than promised/theorized could be delivered, with again MI451, the original hoped design.
The amount of fuckery is too damn high, but future fuckery too damn exponentiallydamn high.
-
Do they actually use KW as a measure in these circumstances? Might as well add the equivalent to resistance heating strips in their chips.
-
All of these datacenter deals are announced in GW. not in gpu units or gpu maker revenue. It's part of the fuckery in deal disclosure, as definitely the GPU provider DGAFs about any of our power problems, and certainly some price per GPU is what they negotiate on.
-
-
-
WE HAVE ALL THE CHIPS
table collapses
-
-
Is that perfectly acceptable or does that count as some sort of insider trading?
Infuriatingly, it's yes to both, when you define "perfectly acceptable" from the viewpoint of the kakistocracy now in charge of preventing and punishing such things.
-
If it looks like inflating the bubble, walks like bubble and quack like bubble...
-
-
OpenAI announced they sold $6B worth of it's shares before that so they probably also bought AMD stocks but I am not form SEC so I don't know
https://www.cnbc.com/2025/10/02/openai-share-sale-500-billion-valuation.html -
Was this a real conversation? Jeez lol
-
Matt Levine is a wall Street lawyer who now does opinion pieces for Bloomberg, usually pretty informative and well written. Here's the full piece
-
You also have the circular investment. NVIDIA puts money into OpenAI. It uses that money to buy computing power from Oracle, who then fills its datacenters with hardware from NVIDIA. Everybody's valuation rises.
Edit: valuation, not validation
Insert 2 economists eating shit joke
Go on..