I mean their cash pile is also invested in money markets (so you get that), and the rest of the portfolio consists of quality companies where their (combined) valuation didn't explode in the last 1,5 years. So it's an opportunity to invest into something that might not be overheated.
BRK has stated that they'll buy back in when prices are reasonable again, so it's an automatic "sell-high buy-low" strategy.
Second, trying to time the market is almost always a suboptimal strategy. The question is when will you likely need the money? If you won't need it for 10 years or more, keep it in index funds. Otherwise, treasuries.
In addition to actual lost jobs, replacing a skilled white collar worker with a fungible operator of AI lowers the salary for that role significantly.
Nobody (including the dragon) benefits from sitting on piles of gold.
Your post is "cute", but 3 or 4 months of operating cash isn't a great example of "sitting on piles of gold".
> The concern is familiar: NVIDIA money funds customers who then buy NVIDIA chips.
Nvidia is making trades for people to buy their GPUs.
Sometimes companies are trading stock for GPUs, sometimes money, other times something else.
In summary, Nvidia is selling GPUs.
Nvidia invests, that equity check gets used to secure 10x it in debt with the GPUs as collateral, and then they buy the chips.
Nvidia gets paid, so they don't hold the debt reliability. But, if AI revenue doesn't cover those debt payments before the GPUs depreciate, the loop starts to unravel, and fast. CoreWeave, Oracle, all the "neoclouds" etc. will blow up, and there could potentially be a ton of PE debt that is now under-collateralized due to depreciation, causing a pretty big haircut to basically all of private credit.
bwfan123•1h ago
vannevar•55m ago
apercu•53m ago
fullshark•40m ago
SoftTalker•30m ago
ryandvm•41m ago
It's some sort of tragic positive feedback loop that isn't going to stop until the whole thing comes crashing down for everyone and we're paying $37,000 for a loaf of bread.