alt Hacker NewsWall Street races to protect itself from AI bubble
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Don't worry, once the Wall Street tap runs dry, the U.S. government will be more than happy to step in and bail out the AI corps. at the taxpayer's expense.
This makes the hair rise up on the back of my neck; it reminds me the sub-prime crisis - "they can't all default at once!"
What bubble? Where is it? I haven't seen it! Here, try my SOTA AI toothbrush.
In the meantime, people who are actually working with it only become more bullish, and see a world where most people are first willing, and later basically required to pay 20-200 per month
> Banks are lending unprecedented sums to technology giants building artificial intelligence infrastructure while quietly using derivatives to shield themselves from potential losses.
And who is their counterparty? Aliens? What a dumb click-bait article.
One thing it's not clear to me: the amount of money is colossal, where the one who are supposed to refund banks will get the money?
Is there a web that calculates implicit credit ratings of the hyperscaler companies?
Looks like we might be witnessing a textbook cycle of self-fulfilling prophecy in the making. As the article suggests, once large investors and institutions start calling this an “AI bubble,” the narrative alone can drive more capital, inflating valuations further just because everyone expects growth. When price → expectation → price becomes the dominant feedback loop, fundamentals matter less.
That kind of reflexivity has powered past bubbles. George Soros’ reflexivity thesis applies: rising prices attract more investment, which inflates prices further, until reality forces a reset. If many AI-related companies can’t quickly deliver expected growth, the eventual correction could be sharp.
In short: hype begets cash, cash begets price, price begets more hype, and at that point, we’re no longer betting on value, we’re betting on the belief itself.
profits have not materialized, nor can they: machines can only transfer value, they cannot create it
Banks hedge investments-it's pretty standard and lowers their risk-weighted assets. If their investments are big, their hedges are big. If banks have a net negative view towards their AI investments, this article fails to articulate that (regardless of how many exciting adjectives they choose to use).