the simple answer is that the people buying AMD stock are the ones paying for those chips
In my eyes this deal is a speculative investment leveraging debt.
But so you have to pick one. Unless you’re suggesting that all the day traders and retirement funds and investment funds are buying or already holding AMD bought it all with credit cards. Which is not the case, which is why this isn’t debt.
Ask yourself - If it’s debt, then who is the creditor? Who holds the loan paperwork? What rate did they get? What’s the collateral? None of those things are true here.
Stock value isn’t real any more than the value of gold or silver or bitcoin, but it’s all relative to the value of the stock when sold. But it being sold is the point. The stocks are worth money. Real actual money. If the market hits a correction - as other more bubble-like parts of the AI industry and the current general economic shitpile are likely to afford us all in the next few years - then OpenAI and NVIDIA and AMD won’t be carved up and sold for parts after a bankruptcy by a bank because they’re still able to sell the stocks to fund payroll. As long as no one sells off a ton of stock quickly and the stock value doesn’t collapse, then it’s simply a risky circular a bet on themselves.
Don’t get me wrong, I think this is an innovation in stupidity and shortsightedness. But call it what it is, which is not debt.
But so you have to pick one. Unless you’re suggesting that all the day traders and retirement funds and investment funds are buying or already holding AMD bought it all with credit cards. Which is not the case, which is why this isn’t debt.
Ask yourself - If it’s debt, then who is the creditor? Who holds the loan paperwork? What rate did they get? What’s the collateral? None of those things are true here.
Stock value isn’t real any more than the value of gold or silver or bitcoin, but it’s all relative to the value of the stock when sold. But it being sold is the point. The stocks are worth money. Real actual money. If the market hits a correction - as other more bubble-like parts of the AI industry and the current general economic shitpile are likely to afford us all in the next few years - then OpenAI and NVIDIA and AMD won’t be carved up and sold for parts after a bankruptcy by a bank because they’re still able to sell the stocks to fund payroll. As long as no one sells off a ton of stock quickly and the stock value doesn’t collapse, then it’s simply a risky circular a bet on themselves.
Don’t get me wrong, I think this is an innovation in stupidity and shortsightedness. But call it what it is, which is not debt.