- Approach a business.
- Request the service or product they provide for free.
- Suggest that instead of paying, you’ll advertise the fact that you “bought” from them.
- Argue that your brand is so awesome that associating with it is valuable enough to substitute for the payment.
Isn’t this basically what influencers do?
Arguably OpenAI has actual influence unlike anyone calling themselves “influencer”, but yes
I’ll pay you with exposure :)
Or you know, buy the chips fair and square, buy the stock fair and square, provide a service that’s worth something, and make profit from both transactions.
You just dont understand business!
/s
It is way more work to provide value than it is to bribe the regulators to agree that you provided value.
Isn’t this basically a kind of insider trading? They wouldn’t be allowed to buy that stock, knowing that this deal is about to happen, but receiving it as part of the deal is okay? That doesn’t feel right to me.
The rules about insider trading only exist to make poor people feel better.
They absolutely catch badly behaved wealthy people
Confirmation bias.
the SEC does not exist under republican administrations and it only exists to protect rich people under democrat ones, as it has been literally since it was created.
whole goddamn US economy is built around speculation and insider trading trying to get an edge on that speculation
Nah, they are rich so it should be fine.
Any deal involving whole percentages of stock will affect the stock price, it’s insider trading when you get a call from someone at AMD before the deal is public, so you can profit. It’s not insider trading for AMD executives to exercise their stock options (which they already had) to profit from the stock movement they just authorised
Do you think rule of law exists in the US?
You also have the circular investment. NVIDIA puts money into OpenAI. It uses that money to buy computing power from Oracle, who then fills its datacenters with hardware from NVIDIA. Everybody’s valuation rises.
Edit: valuation, not validation
Insert 2 economists eating shit joke
Go on…
Two economists are walking in a forest when they Come across a pile of shit.
The first economist says to the other “Ill pay you $100 to eat that pile of shit.” The second economist takes the $100 and eats the pile of shit.
They continue walking until they come across a second pile of shit. The second economist turns to the first and says “l pay you $100 to eat that pile of shit.” The first economist takes the $100 and eats a pile of shit.
Walking a little more, the first economist looks at the second and says, “You know, I gave you $100 to eat shit, then you gave me back the same $100 to eat shit. can’t help but feel like we both just ate shit for nothing.” “That’s not true”, responded the second economist. “We increased the GDP by $200!”
Plus, at least one of the two economists got really, really hard watching his buddy eat some shit.
I knew this joke as two people selling a painting back and forth
Economists eating shit is funnier
This works better with an accountant and an economist.
AMD too?
So, assuming that Intel is also on the wrong side of history as usual (and that their cards are actually good for gaming, of which I’m not convinced) , you literally can’t buy a decent gaming GPU without paying into the AI nonsense?
Nope sadly, AI needs GPUs and it makes up the bulk of sales of these chips now.
It would be suicide for any of the companies that could make these processors to not go after the biggest market. The result of a company not doing that would be watching all their competitors grow and advance their products whilst their company’s value drops and products stagnate, possibly to a point that recovery to competitiveness would be hard if not impossible.
When AMD’s biggest market was Litecoin (and derivatives like Dogecoin) mining and Nvidia’s hardware was pants at mining, they initially couldn’t increase production of the HD 7000 series quickly enough, so the initial glut of money went to scalpers. They responded by making huge volumes for the Rx 200 series, but shortly after it launched, Litecoin mining ASICs became available and GPU mining stopped being viable. That meant that:
- they’d spent lots of money manufacturing lots of GPUs.
- miners were selling used GPUs for a fraction of the retail cost while those cards were still the current generation.
- people didn’t want to buy a new card for several times the price of the same card but used for a few months.
- retailers had to drop prices to keep selling new cards.
- wholesale prices had to drop to keep retailers stocking new cards.
- AMD weren’t making any profit when they sold these cards.
- the RX 300 cards weren’t compelling compared to a massively discounted RX 200 card, so they didn’t sell in huge quantities or with good margins, either.
This wasn’t the only time ATi/AMD took a calculated risk and it backfired horribly, so with their history of bad luck, chasing the AI bubble in any way that involves risk instead of just selling things for money might be a bad idea.
That’s how I got a R9 290 for “cheap,” and continued to use it for something like 10 years (replaced it just a couple years ago).
The AI cards don’t have video-out though :(
they’re all playing the same game
Look, the recent CPU lineup had AI in its name, has dedicated cores in it. Because Windows wants to do AI things or whatever.
its
Intels main focus with their GPUs has been AI workloads. I have an Arc A770 I don’t use because while it works great for LLMs and shit, it doesn’t run the games I want it for. 🙃
It’s going to be a fucking bloodbath when it bursts.
It fucking should be. It’s been nearly as much an annoyance in my feed as Sovcit Hussein. Death to AI and the bastards trying to shove it down our throats.
Assuming it ever bursts… Do the people in power want the bust?
You’re paid in exposure.
NVIDIA’s deal makes much more sense. Will use OpenAI revenue to buy shares in OpenAI and still profit if OpenAI goes bankrupt.
This is less a “vote of confidence” in AMD, because shit is free for OpenAI here. I too will buy all the AMD GPUs if you give me AMD stock of same or greater value. This deal structure actually makes AMD look terrible and unconfident in its product. But deal is not transparent enough.
Perhaps unconfident in the future demand of their product.
That’s what I meant, though specs look great, and so “unconfident in execution of future roadmap” or cost/yield issues, but tsmc has history of success in new tech generations. OTOH, Rubin is sticking with 3nm as AMD goes for 2nm on the critical part.
Something is very wrong with this deal. Can know this without knowing any specifics of what’s wrong.
Ah I see now. I meant to imply AMD knows the bubble is going to burst soon and they’re trying to cash in as much as possible now.
I don’t think AMD is on the verge of a technology crisis, but I’d have said the same about Intel way back when so maybe you’re on to something.
AMD knows the bubble is going to burst
definitely not it. Anyone making better GPUs should be able to sell them at a price=performance level. LLMs themselves are forever. Running them on consumer level hardware with privacy is an attractive alternative to US military/Skynet allied OpenAI datacenters. That does mean smaller models than “skynet frontier”.
Reaching for other explantions.
CIA allied bankster money to keep OpenAI solvent with some side deal for AMD.
AMD needed a desperate deal to have lead Skynet developer use some of its GPUs instead of only Nvidia. For all the OpenAI committments, there is both massive risk of OpenAI bankruptcy, but also no matter how good other frontier models are/can be, waiting for OpenAI bankruptcy, and buying their datacenters, makes more sense than adding your own 20.5GW (with Oracle) of GPU/power demand, and outbidding OpenAI for GPUs from non-China sources. But its not as though MSFT/GOOG/META can’t outbid for GPUs, or not make better frontier or smaller open models. I could include mechaHitler for Skynet, but the funding pockets though large, seem as though its a marketing/investment headwind for whatever good technical achievements the mechaHitler models have done. MechaHitler AI has its own financing fuckery valuations with Elon share swaps.
Already Mac M3 ultra 512gb is a great LLM machine for very large LLMs (quantized frontier models). Nvidia and AMD will have larger vram consumer GPUs soon enough. Smarter competitors than OpenAI exist in the space, and smartness goes for better cost per benchmark point and per token.
GPT 5 pro is most expensive model in the world at $150/Mtokens output. A $2000 5090 will output the same tokens/cost in 90 days. With privacy or something you can rent to others without Skynet oppression data concerns. On an open small model that you can posttrain to be better at the domain you are interested in than GPT5 behemoth, and rentals that use whatever domain tailored model they want. But US mega corporations already offer 10x
OpenAI losses are accelerating, and expected 2023-2028 total of $45B, with (banskter/OPenAI optimistic) breakeven in 2029. Skynet military contracts of $1T is the prize. Competition to OpenAI can be forced to provide value through smaller model performance boosts that China (Mistral from France too) already actually has the best real world value models. The previous 5090 token output comparison, gets worse on 100x cheaper small open models that exist, but the privacy and posttraining benefits, priceless.
The common weak link in all of these circular financing deals is OpenAI. Except on this one, where AMD is the weaker side. Of course this makes the banksters pump AMD stock. People like to shout AI/LLM bubble, but OpenAI and MechaHitler going for Skynet is going to get a lot of powerful sustain. Still, Skynet ambition is opposite of best path to making money/useful models until US/Israel military payday.
Honestly, it feels like all of that is as plausible as anything else right now
Was this a real conversation? Jeez lol
Matt Levine is a wall Street lawyer who now does opinion pieces for Bloomberg, usually pretty informative and well written. Here’s the full piece
If that’s ain’t gaming system then I don’t what is
Wise words, Bil.
what baffles me is how blatant the big tech behaves. it is comically Bond villainesque. even big oil and pharma don’t act like that - at least they try to play-pretend they’re good guys (albeit everyone sees through their bullshit)
it’s a big club and we’re not in it
therefore - fuck all’em
Is this really what happen?
Pretty much. OpenAI will “give” AMD 78bln for 10% of the stock and the chips openAI actually wants. This whole ordeal has been publicly paraded like OpenAI and AMD partnering up, which has already pumped up AMD stock price by 45%. Thus openAI will eventually get their 78bln (which they actually never had in the first place) back in AMD stock.
So who actually pays the 78bln? The simple answer is AMD stock holders, currently the ones who have bought the stock after the announcement and later the ones who bought it before it crashed. The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn’t dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future. Who knows who is actually paying for it because AMD stocks will get used elsewhere (for example as collateral in a loan) and the economic growth with absorb the costs. In short, we might as well imagine nobody paid for the chips.
In short, brace for another “once in a lifetime” economic crash.
The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn’t dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future
The stock market has been a speculative mess where the numbers are made up during my entire lifetime.
The more complex answer is that the stock market at this point is just a speculative mess where numbers are made up because the price isn’t dictated by what the company is currently capable of doing but rather what the company potentially could be doing in the future.
Drew Carey: Welcome to the stock market, where the points are made up and money loss really matters
This isn’t the way economic bubbles are typically structured. At all.
Typical economic bubbles are built on speculative investment leveraging debt until the whole thing reaches a point where the debt can’t realistically account for possible growth anymore. This would be OpenAI asking SoftBank for $78B to buy chips that have at most, a maximal 5 year life cycle, and then OpenAI not having cash on hand to pay down that $78B in 2 years.
Using this stock reacharound is actual money changing hands. Yes, stock dividends and sales are part of that, but it’s not debt. It’s certainly not sustainable, but it’s not something that will lead to bankruptcy for OpenAI or NVIDIA or AMD if they fail to turn profits. But the money is real at the time it’s moved around. Surprisingly, the LLM crowd has been fairly consistent in not running to highly leveraged debt for funding.
This is a pump and dump scheme if anything, and seems like a great way to find out later that people buying stock in AMD “invested” in shrinking their portfolio over the long term. IMO only a fool would buy stocks that funded this, but it’s a slow-mo bubble for those people, not the economy in general.
Money did exchange hands but it had to come from somewhere, OpenAI doesn’t have 78bln just lying around. Someone somewhere took debt so OpenAI could pay that price and OpenAI is planning on paying back that debt with AMD stock. That why I said the simple answer is that the people buying AMD stock are the ones paying for those chips. But these things don’t happen in an instance, they take time which is why I said the complex answer is that nobody really knows who is going to pay it back. As a simplistic example, while the “dump” of AMD stocks hasn’t happened someone can borrow money against the overpriced AMD stock. Now, if whoever gave the actual money to OpenAI comes asking for their 78bln back and OpenAI doesn’t have it they will dump the AMD stocks to pay it back and then the person who used AMD stocks as collateral will be asked “Your collateral is now useless, give me more collateral or pay me back” and that money will be found elsewhere until someone goes broke and the debt gets defaulted. Of course that won’t happen as long as nobody comes asking for the spent money.
In my eyes this deal is a speculative investment leveraging debt. OpenAI itself doesn’t have the debt but it is somewhere because the actual liquidated money had to come from somewhere. And there is speculative investment with the hopes of AMD stocks going up enough to offset that debt. The 78bln might not end up as debt for OpenAI, but it might end up as a different debt for the loans that used propped up AMD stock as collateral. IMO it doesn’t really matter where exactly the debt ends up because if the bubble pops AMD stocks are also going to take a hit and someone somewhere is going to end up paying for the debt that was caused by this 78bln deal.
Someone somewhere took debt
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.
I guess we’ll find out when the Big Short 2 comes out.
The Bigger Shorter
2 Big, 2 Short
Also, make sure to keep secret the actual milestones and share allocations being gifted to OpenAI.
MI450s are expected to be $40k/kw. 6gw would be $240B in revenue. AMD can make MI450 an openAI only product and overcharge them for it. MI451 for everyone else. If price is fixed, MI450 is not finalized, afaik, and so much lower specs than promised/theorized could be delivered, with again MI451, the original hoped design.
The amount of fuckery is too damn high, but future fuckery too damn exponentiallydamn high.
Do they actually use KW as a measure in these circumstances? Might as well add the equivalent to resistance heating strips in their chips.
All of these datacenter deals are announced in GW. not in gpu units or gpu maker revenue. It’s part of the fuckery in deal disclosure, as definitely the GPU provider DGAFs about any of our power problems, and certainly some price per GPU is what they negotiate on.
WE HAVE ALL THE CHIPS
table collapses
