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What if all this cap ex is not just premature and plagued by accounting engineering but is also not necessary, ever? I had an interesting talk with one of the billionaire tech founders the other day. There is so much innovation being spurred by this AI frenzy, and it seems that the narrative is missing what some of the frenzied are doing. Thinking about it the last few days, it hits me, of course this is happening, and of course they would miss it.

If you count Oracle and CoreWeave, Hyperscaler Capex will easily hit $700 Bn. in 2026 and $1 Tr. in 2027.

Yet, the demand for compute is rising faster than ROI is being demonstrated. I call it the "Altman Paradox".

Feb 7
at
3:27 PM

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