Yes? What happened to FAANG in last 3 years, they cut a fuck load of jobs, the raised rent/prices, then inflation, then experience surge in new category AI. 1 + 2, i.e. squeezing rock has limits. 3 is fundamentally not sustainable, i.e. AI revenue gap order of magnitude relative to spend. This like debt crisis, there's lot of levers to burn to maximize extraction and make ledger look good short term, but is fundamentally not long term sustainable. Articles arguing over minutiae / short term accuracy pointless, market can stay irrational than one can stay liquid blah, blah - I mean its useful for investing - but when talking about long term predictions he's just stating the obvious, the financials don't make sense within the business cycle current players are operating in.

Like one can believe AI is speciation event technology eventually, but still given actual constraints, i.e. literally not enough investors for $$$, not enough hardware, not enough infra over xyz time horizon that these companies carrying stupendous debt and mathematically guaranteed stranded / deprecated compute infra is only digging themselves deeper vs future competitors. Sure AI can eventually capture 30% of GDP and knowledge worker's life time achievement is worth a few $100 of compute or a few pennies in thinking sand. But ultimate winners is probably going to be some future startup that pays pennies for thinking sand not incumbent who paid magnitude more and simply can't operate profitably due to balance sheet.

To be fair to Ed, I’d describe his usual argument (at least currently) as saying that Meta, MS, google are “mature” companies trying to be maintain the high valuations and growth of a young company, which they no longer are.

If you take this to be his argument, then dan’s numbers are more consistent ed’s claim.

Are they? These companies have been caught tweaking their numbers. One example, not sure if cited by Zitron, or others, is that they build data centers through holding companies, who have to absorb the costs and massive capex based financial liabilites, so that the brand-name big-tech companies get to keep their expenses off their books. There have been trillions of debt discovered this way. Another issue is the apparently relentless progress of the hardware industry, needed to justify their super-high P/E ratios, measured against the fact, that to lessen the effect of HW amortization, hyperscalers opted to lengthen the depreciation timelines of their GPUs. So there is an apparent contradiction that new hardware needs to be both substantially better, and substantially the same, to make both stories true. I'm not a finance guy, and a lot of it is over my head, but even finance people keep asking the 'who's gonna pay for this' question. We're way past the belief that this is going to produce reasonable returns (as in a value for money kind of way), and hoping we can financially engineer ourselves out of this situation without having to feel the pain.