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Guaranteed Human did you know Microsoft has officially ended Support for Windows 10? Upgrade to Windows 11 with an LG Gram laptop voted PCMag's Reader's Choice Top Laptop Brand for 2025. Thin and ultra lightweight, the LG Gram keeps you productive anywhere, and Windows 11 gives you access to free security updates and ongoing feature upgrades. Visit LGUSA.com iHeart for great seasonal savings on LG Gram laptops with Windows 11 PC Mag Reader's Choice Used with permission. All rights reserved. Well, the holidays have come and gone once again, but if you've forgotten to get that special someone in your life a gift, well, Mint Mobile is extending their holiday offer of half off unlimited wireless. So here's the idea. You get it now, you call it an early present for next year. What do you have to lose? Give it a try@mintmobile.com Switch limited time.
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50% off regular price for new customers. Upfront payment required $45 for three months, $90 for six months or $180 for 12 month plan taxes and fees. Extra speeds may slow after 50 gigabytes per month when network see Terms. Thank you for calling the Bombas Comfort line. Bombas make socks, slippers, tees and underwear made with the highest quality materials. Press 1 for comfort, 2 for style, 3 for donation. You chose style. Bombas is styles for whatever you enjoy. You can run in bombas, lounge in bombas, dress them up, dress them down. But always give back in Bombas because with every item purchased, another is donated Bombas Comfort. Worth calling for? Go to bombas.com audio and use code audio for 20 off your first purchase. That's B O-M-B-A-S.com and use code audio.
- [01:35]
CarMax Representative
Want to buy your way? Of course you do. That's why CarMax offers an experience designed just for you. Want to start online, then visit the lot, then go back online?
- [01:43]
Ed Zitron
Sure.
- [01:43]
CarMax Representative
Want to talk to a real person or chat online? Either works. Want to take your time and compare all the makes and models? No problem. Then make up some time by filling out the paperwork at home and schedule express pickup or home delivery Done. When it comes to how you buy, CarMax puts you in the driver's seat. Want to drive? CarMax delivery restrictions apply. See CarMax.com for details.
- [02:06]
Ed Zitron
Call Zone Media all right, we're back. I'm Ed Zitron and this is Better Offline. Better Offline this is the fourth and final episode of this four part series where I dissect an excruciating Comprehensive detail the AI bubble and tell you why I think its implosion is inevitable. We're at the end, which is fitting, because in this episode, we're going to talk about why and how this entire sham dies. Again, if you jumping in now, start from the beginning. We talk about a lot of things and it all kind of threads together. I know, I know. You want to hear my explanation of how OpenAI is fucked with a capital fuck, but we've got to lay the groundwork to get there. Okay. Caught up. Good. Good. We're good. We're good. You ready? Okay. You good? Meep, meep. Okay, we'll begin. One of the comfortable lies that people tell themselves is that the AI bubble is similar to the fiber boom, or the dot com boom, or Uber, or that we're in the growth stage, or that this is what software companies do. They spend a bunch of money, then pull the profit lever. The thing is, this is nothing like anything you've ever seen before because this is the dumbest shit the tech industry has ever, ever done. AI data centers are nothing like fiber because there are very few actual use cases for these GPUs outside of AI, and none of them are remotely hyperscale revenue drivers. As I discussed a month or so ago, data center development accounted for more of America's GDP growth than all consumer spending combined in the first half of 2025. And there really isn't any demand for AI in general, let alone at the scale that these hundreds of billions of dollars are being sunk into. The conservative estimate of capital expenditures related to data Centers is around $400 billion. But given the $50 billion in a quarter in private equity invested, I'm going to guess it breaks half a trillion. All to build capacity for an industry yet to prove itself. And this whole Nvidia OpenAI $100 billion funding news should only fill you full of dread. But also, it isn't fucking finalized. Stop reporting as if it's done. I swear fucking anyway. Good. According to CNBC, and I quote, the initial $10 billion tranche is locked in at a $500 billion valuation and expected to close within a month or so once the transaction has been finalized, with successive $10 billion rounds planned, each to be priced at the company's then current valuation as new capacity comes online. What a horrible deal. They can just raise whatever. Let me just go back to Nvidia, but let me just be clear. OpenAI has written a lot of checks that neither it nor anyone else can cash. And for it to survive, it needs to raise more than honestly about $500 billion and maybe another $400 billion in other people paying for stuff. It's astonishing really. At no point is anyone asking how exactly OpenAI builds the data centers to fill full of the GPUs to get the rest of Nvidia's funding. In fact, I'm genuinely shocked and a little disgusted by how poorly this story has been told. Let's go point by point. $10 billion is not enough for OpenAI to build a data center. The 1.1 1.2 gigawatt Gabalene, Texas data center being built by Oracle and Crusoe for OpenAI required $15 billion in debt, and that's not including the $40 billion of chips needed to power it. Though I question whether all of those are going into Abilene or somewhere else we'll get to later. OpenAI can also not afford to pay for everything it's promised. OpenAI will burn, they say $115 billion in the next four years according to the information, but I believe leaked those numbers before the announcement of their $300 billion deal with Oracle. It's when you take into account the numbers shared with the information which involved them burning $47 billion in 2028 a year when it OpenAI is meant to make $70 billion in payments to compute to Oracle, another $28 billion to Microsoft or any other cost. There's no space for the $300 billion to go and there's actually another hundred billion dollars they're promising for backup compute as well. On top of all of this, OpenAI is still yet to convert to a for profit entity and must do so by the end of 2025 or they'll lose $20 billion in funding from SoftBank. A few weeks ago, Microsoft and OpenAI Co published an announcement that said they'd signed a non binding memorandum of understanding for the next phase of their partnership, which the media quickly took to mean the deal was done. No deal has been done. This is an announcement of nothing. On top of all of this, venture capital might run out of the current rate of investment in around six quarters and OpenAI needs more investment. The information recently published some worrying data from venture capitalist John Sakoda that at today's clip the industry would run out of money in six quarters, adding that the money wouldn't run out until the end of 2028 if it wasn't for OpenAI and Anthropic. In a very real sense, OpenAI threatens the future of available capital for the tech industry well, the good news is that they're going to make lots of money, right? I mean, OpenAI leaked that they'll make $200 billion in four years time. I mean, if you're concussed, I can see how you believe that. Let's go. I'm going to read you a bunch of numbers. I know it's kind of going to be annoying to hear this for the next 30 seconds. I'm going to just throw figures at you, but pay attention because it's important to realize how insane this is. So, in 2025, OpenAI projects to make $13 billion and have free cash flow of negative $9 billion. In 2026, OpenAI will make $29 billion or $30 billion, but have free cash flow of negative 17 billion. In 2027, OpenAI will make $60 billion but have negative cash flow of negative $35 billion. And in 2028, OpenAI will make $100 billion but have free cash flow of negative $47 billion. In 2029, OpenAI will make $145 billion, but a free cash flow of negative $8 billion. Somehow, I just want to reiterate there. OpenAI's projections. See it reduce its negative cash flow by $39 billion, or 1 1/2 times 3M's revenue from the last financial year. Revenue by a similar amount, give or take a few billion. Who's counting? Certainly not Sarah Fryer, the CFO of OpenAI. It's also fucking stupid. But don't worry. I know, I know some of you have been worried. You see big, strong men with tears in their eyes saying, sir, sir, OpenAI, they're not gonna have enough money. They're gonna die. But don't worry. In 2030, OpenAI will make $200 billion and somehow have positive free cash flow of $38 billion. It's just that easy. I don't teach you this in business school. It's just that easy.
- [08:21]
Rob Gronkowski
How?
- [08:21]
Ed Zitron
They're going to make it. They're going to make it. They'll be fine. OpenAI's current reported burn is $115 billion through 2030, which means there's no way that these projections that were leaked included $300 billion in compute costs. Even when you factor in the revenue, there's no space in the projections to absorb the Oracle money. And from what I can tell, by 2029, OpenAI will burned up, have burned upwards of $290 billion. Assuming it survives that long, which I do not believe it will. Don't worry. Though OpenAI is about to make some crazy money. I say, in no way being totally sarcastic, I'm going to now read you some of the projections that CFO Sarah Fryer signed off on. This is a professional chief Financial Officer. Again, more numbers. But pay attention, pay attention. This is, I want to give you, because these are numbers you just heard, but I want to give you some comparison points. So in 2026, OpenAI will make, according to their projections, or These are the projections, $30 billion in revenue, or just the $34 billion that Salesforce made in 2024. In 2027, OpenAI will allegedly make $60 billion, or 2.6 billion more than the $57.4 billion that Oracle made in its fiscal year 2025, or $8.4 billion more than Broadcom made in 2024. In 2028, this is crazy. OpenAI will make $100 billion, $2.3 billion more than Tesla made in 2024, or 11 point, $11.66 billion more than TSMC, the single largest chip manufacturer in the world. In 2029, things get crazier because OpenAI will then make $154 billion, or $14.5 billion more than the $130.5 billion that Nvidia made in its fiscal year 2025. But in 2030, this is when they really blow the doors off. They will make $200 billion, or $35.5 billion than the 164.5 billion that Meta made in 2024. Just so we are clear, OpenAI intends to 10x its revenue in the space of four years, selling software and access to its models in an industry with. With about $60 billion of revenue in 2025. How will it do this? OpenAI does not say. I don't know OpenAI CFO Sarah Fryer. But I do know that signing off on these numbers is, at the very least, ethically questionable. But putting aside the ridiculousness of OpenAI's deals or its funding requirements, Friar has willfully allowed Sam Altman and OpenAI to state goals that defy reality or good sense, or to take advantage of investors and public markets that have completely lost the plot. I'm actually. You know what? I'm actually going to be blunter. OpenAI has signed multiple different deals and contracts for amounts it cannot afford to pay, that it cannot hope to raise the money to pay for, that defy the amounts of venture capital and private capital available, all to sustain a company that will burn half a trillion dollars in the next four years based on their own expenditures, and they have no path to profitability of any kind. But what about that Nvidia deal, Ed? $100 billion is a lot of money, right? It is, but the announcement is bullshit. I know you may have read otherwise, but Nvidia didn't give OpenAI $100 billion. In fact, $90 billion of that is contingent on OpenAI building roughly $125 billion worth of data centers with $200 billion worth of GPUs inside them. And those data centers will have to be built faster than anyone could possibly build something at that scale. And there's no evidence that OpenAI knows where or when these facilities will be built or who will build them. Important detail as well. Nvidia's data centers have nothing to do with Stargate. So when you read that OpenAI has 7 gigawatts of Stargate, whatever, it doesn't exist. Who cares? That's nothing to do with Nvidia. Oracle is not building these data centers. The 10 gigawatts that they need to build with Nvidia are something completely separate.
- [12:12]
LG Gram Laptop Advertiser
Did you know Microsoft has officially ended Support for Windows 10? Upgrade to Windows 11 with an LG Gram laptop, voted PCMag's Reader's Choice top laptop brand for 2025. Thin and ultra lightweight, the LG Gram keeps you productive anywhere, and Windows 11 gives you access to free security updates and ongoing feature upgrades. Visit lgusa.com iheart for great seasonal savings on LG Gram laptops with Windows 11. PCMag reader's choice used with permission. All rights reserved.
- [12:42]
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- [13:42]
Rob Gronkowski
This is Rob Gronkowski from Dudes on Dudes With Gronk and Jules, Sunday mornings are sacred. I've got my game day routine, coffee jersey laid out and my lucky playlist. But the real game changer? New morning Uncrustables sandwiches.
- [14:00]
Julian Edelman
I've always loved uncrustable sandwiches and now I'm all about the new flavors with 12 grams of protein. Bright Eyed Berry or Up an Apple. Bright Eyed Berries got that flashy, finesse vibe like your favorite slot receiver.
- [14:16]
Rob Gronkowski
Up an Apple. Tough and reliable like a do it all tight end.
- [14:21]
Julian Edelman
And players love them. And did you know teams crush over 80,000 uncrustable sandwiches a year? They know it's good.
- [14:29]
Rob Gronkowski
It's a snack that can go with you anywhere from the couch to the tailgate or even in the locker room. Soft bread, Yummy fillings. Protein packed. Once it's part of your ritual, you don't skip it.
- [14:43]
Julian Edelman
Easy enough for Gronk to grab straight from the freezer.
- [14:47]
Rob Gronkowski
Your new Sunday kickoff ritual starts here with the new morning Uncrustable sandwiches packed with 12 grams of protein.
- [14:56]
CarMax Representative
Want to buy your way? Of course you do. That's why CarMax offers an experience designed just for you. Want to start online, then visit the lot, then go back online?
- [15:04]
Ed Zitron
Sure.
- [15:05]
CarMax Representative
Want to talk to a real person or chat online? Either works. Want to take your time and compare all the makes and models? No problem. Then make up some time by filling out the paperwork at home and schedule express pickup or home delivery.
- [15:17]
Ed Zitron
Done.
- [15:17]
CarMax Representative
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- [15:28]
Ed Zitron
But you know what? Let's take a step back with something really simple. Data centers take forever to build. As I've said previously, based on current reports, it's taking Oracle and Crusoe around 2.5 years per gigawatt of data set capacity. And nowhere in these reports does one reporter take a fucking second to say, hey, what data centers are you talking about? Hey, didn't Sam all my say back in July he was building 10 gigawatts of data center capacity with Oracle. But wait, Now Oracle and OpenAI have done another announcement that says they're only doing 7 gigawatts, but they're already ahead of schedule on 10 gigawatts. Like I said, totally different 10 gigawatts to the one with Nvidia. But you know what? You've got a few hundred billion dollars of data centers. Now you're making real money. Anyway. I cannot be clear enough how unlikely it is that the first gigawatt of Nvidia systems will be deployed in the second half of 2026, as Nvidia has stated with their deal with OpenAI. And that's as if has been bought and got permits and the construction has started. None of this has happened. But you know, let's get really specific on costs. Crusoe's 1.2 gigawatts of compute for OpenAI is a $15 billion joint venture, which means a gigawatt of compute runs about $12.5 billion worth of construction. Abilene's eight buildings are meant to hold 50,000 Nvidia GB200 GPUs and their associated networking infrastructure. So let's say a gigawatt is around 333,000 Blackwell GPUs, even though the GB2 hundreds are technically two of them put together. Though this math is a little funky due to Nvidia promising to install its new Ruben GPUs in these theoretical data centers. That means these data centers will require a little under $200 billion worth of GPUs. By my maths, that's about $325 billion. But Nvidia is saying it could be half a trillion. But you know, who gives a shit, right? Numbers don't matter. You've got Jensen Huang telling CNBC that 1 gigawatt costs 50, 60 billion dollars. You've got Altman claiming the same thing to Bloomberg. But my math says something completely fucking different. But no one seems to want to bother, you know, Sony. Like the places I'm quoting are leading business outlets with teams of thousands of people with incredible infrastructure where they could sit down and say, well, you know, it costs this much to build Stargate Abilene. Why don't we work out actually what this costs? No, no, no, just eat the info slop. Yum, yum, yum. You know, it doesn't exhaust me, it doesn't make me cynical and frustrated with people who could do a good job. Indeed, I've seen them do a good job, but they just seem to not want to do one with this. And it genuinely bothers me on a day to day basis. Okay, I realize I'm just ranting at this point, but I'm going to be honest, I'm just, I'm so tired of this. As a reminder as well, OpenAI has agreed to spend $300 billion on compute with Oracle. But at this point, as you can tell, numbers basically don't have meaning. Numbers have stopped meaning anything. If you believe these numbers, you're a fantasist or a liar. Or you just don't want to think about them too much, because when you think about them, you start to realize how unrealistic it is. And even if you remain steadfast in your belief of the transformative potential of large language models, eventually there comes a point where reality must prevail and you accept that we're in a bubble. Whether you like it or not, what we're witnessing is one of the most egregious wastes of capital in history, sold by career charlatans with their reputations laundered by a tech and business media afraid to criticize the powerful and analysts that don't seem to want to tell their investors the truth. There are no historic comparisons here. Even Britain's abominable 1800s railway bubble, which absorbed half of the country's national income, created valuable infrastructure for trains, a vehicle that can move people to and from places. The train doesn't randomly just go backwards when you make it go forwards. It doesn't become a bus or a dog at random. It doesn't hallucinate doors that open and close at random. Trains work, and GPUs are not trains, nor are they cars or even CPUs. They are not adaptable to many other kinds of work, nor are they the infrastructure of the future of tech, because they're already quite old and with everybody focused on buying them, you'd absolutely see one other use case by now that actually mattered. GPUs are expensive, power hungry, environmentally destructive, and require their own kinds of cooling and server infrastructure, making every GPU data center an environmental and fiscal bubble unto themselves. And whereas the Victorian train infrastructure still exists in the uk, though it has been upgraded over the years, a GPU has a limited useful lifespan. These are cards that can and will break after a period of extended usage, whether that period is five years or later, though I hear it's one to three, and they'll inevitably be superseded by something better and more powerful, meaning that the resale value of that GPU will only go down with a price depreciation that's akin to a new car and then a used car and then a car that you kick the door of every so often. I am telling you, as I have been telling you for years, again and again and again, that the demand is not there for generative AI and the demand is never, ever arriving. The only reason anyone humors any of this crap is the endless hoarding of GPUs to build capacity for a revolution that will never arrive. Well, that an OpenAI, a company that's built and sold on lies about Chat GPT's capabilities. ChatGPT's popularity and OpenAI's hunger for endless amounts of compute have created the illusion of demand due to the sheer amount of capacity required to keep their services operational. Also, they can burn around $8 billion or more in 2025, and hundreds of billions of dollars more by 2030 if they make it, which they won't. The Nvidia deal is a fast and obvious attempt by the largest company on the American stock market to prop up the one significant revenue generator in the entire industry, knowing that time is running out for it to create new avenues for eternal growth. I'd argue that Nvidia's deal also shows the complete contempt that these companies have for the media. There are no details about how this deal works beyond the initial $10 billion. There's no land purchase, no data center construction started, yet the media slurps it down without a second thought. I am but one man, and I am fucking peculiar. I did not learn financial analysis in school, but I appear to be one of the few people doing even the most basic analysis of these deals. And while I'm having a great time doing so, I'm also extremely frustrated about how little effort is being put into prying apart these deals by the people. I realize how ridiculous all of this sounds. I get it. There's so much money being promised to so many people, market rallies built off the back of these massive deals. And I get that the assumption is that this much money can't be wrong, that this many people wouldn't just say stuff without intending to follow through, or without considering whether their company could afford it. I know it's hard to conceive that these hundreds of billions of dollars could be invested in something for no apparent reason. But it's happening. Write goddamn now in front of your eyes, and I am going to be merciless on anyone who attempts to write how could we possibly have seen this coming? Generative AI has never been reliable, has always been unprofitable, and has always been unsustainable. And I've been saying so since at least February 2024. These economics have never made sense, something I've said repeatedly since April 2024. And when I wrote how does OpenAI survive in July 2024, I had multiple people suggest I was being an alarmist. Here's some alarmism for you. The longer it takes for OpenAI to die, the more damage it will cause once it does. As I talked about earlier in the series, venture capital could run out in six quarters, with investor and researcher John Sakoda estimating that there will be only around $164 billion of dry powder, which is available capital by the way, in US VC firms by the end 2025. In July, the French Tech Journal reported, Using PitchBook data, the global venture capital deal activity reached its lowest first half total since 2018, with $139.4 billion in deal value in the first half of 2025, down from $183.4 billion in the first, meaning that any further expansion or demands for venture capital from OpenAI will likely SAP the dwindling funds available for other startups. Things get worse when you narrow things to US Venture capital. In a piece from April, Ernst and Young reported the VC backed investment in US companies hit $80 billion in Q1 2025, but one $40 billion deal accounted for half of the investment. OpenAI's $40 billion deal, of which only $10 billion has actually closed, and that didn't happen until fucking June. Without the imaginary money from OpenAI, US venture capital would have declined by 36%. I should also add another $8.3 billion was added on top of that. But still, that's less than $40, folks. The longer the OpenAI survives, the longer it will SAP the remaining billions from the tech ecosystem, and I expect its tendrils to extend to private credit soon too. The $325 billion it needs just to fulfill its Nvidia contract, albeit over four years, is an egregious sum that I believe exceeds the available private capital in the world. And I went and actually looked, assuming that all of this capital is currently available, the top 10 private equity firms in the world have around $477 billion of available capital. A reminder, $477 billion is a lot less than OpenAI's total commitments over the next few years. In fact, I put a premium newsletter out just before recording this, so I didn't totally update the script. But OpenAI needs a trillion dollars. They need about 500 billion for operations and about 450 billion for all the data centers they promised and the GPUs in them. It's not really good. It's not good at all. But if we include the cash at hand at the biggest investment banks, this brings us up to by the way, if we assume that all of these funds are available, about $562 billion in capital and $164 billion of venture capital in the US to spend and that's all meant to go in more places than just OpenAI. That's not enough. If we combined all the available private equity firms in the top 10, all of the available USVC, that's not enough to pay for all the bills that OpenAI's said. It's. We're in a fucking bubble, man. Come on. Sure, I also get that there's more than 10 private equity firms and there's more venture money and that they could raise more money for male peace. But what's Left? Exactly. Another 150, 200, 300 billion. They need that. They need all of that. Hand that over to Clammy Sammy right now. Clammy needs to give that money to Jensen. Jensen need money number go up, you asshole. Give money to Jensen Huang now.
- [25:39]
LG Gram Laptop Advertiser
Did you know Microsoft has officially ended Support for Windows 10? Upgrade to Windows 11 with an LG Gram laptop, voted PCMag's Reader's Choice top laptop brand for 2025. Thin and ultra lightweight, the LG Gram keeps you productive anywhere. And Windows 11 gives you access to free security updates and ongoing feature upgrades. Visit lgusa.com iheart for great seasonal savings on LG Gram laptops with Windows 11. PCMag reader's choice. Used with permission. All rights reserved.
- [26:10]
LifeLock Advertiser
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- [27:09]
Rob Gronkowski
This is Rob Gronkowski from Dudes on Dudes with Gronk and Jules. Sunday mornings are sacred. I've got my game day routine coffee jersey laid out and my lucky playlist. But the real game changer, new morning uncrustables sandwiches.
- [27:27]
Julian Edelman
I've always loved uncrustable sandwiches, and now I'm all about the new flavors. With 12 grams of protein Bright Eyed Berry or up an apple Bright Eyed Berries got that flashy, finesse vibe like your favorite slot receiver.
- [27:44]
Rob Gronkowski
Up an apple Tough and reliable like.
- [27:47]
Julian Edelman
A do it all tight end and players love them. Did you know teams crush over 80, 000 uncrustable sandwiches a year? They know it's good.
- [27:56]
Rob Gronkowski
It's a snack that can go with you anywhere from the couch to the tailgate or even in the locker room. Soft bread Yummy fillings. Protein packed. Once it's part of your ritual, you don't skip it.
- [28:11]
Julian Edelman
Easy enough for Gronk to grab straight from the freezer.
- [28:14]
Rob Gronkowski
Your new Sunday kickoff ritual starts here with the new morning Uncrustable sandwiches packed with 12 grams of protein Want to.
- [28:24]
CarMax Representative
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- [28:26]
Ed Zitron
Who wouldn't?
- [28:26]
CarMax Representative
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- [28:57]
Ed Zitron
You see, OpenAI needs to buy those GPUs and it needs to build those data centers. And it needs to pay its thousands of staff and marketing and sales costs too. Well, OpenAI likely wouldn't be the ones raising the money for the data centers, and honestly, I'm not sure who would at this point. Somebody is going to need to build 20 gigawatts of data centers if we're going to believe Oracle and Nvidia. You may argue that venture funds and private equity funds can raise more, and you're right. But at this point there have been few meaningful acquisitions of AI companies and zero exits from the billions of dollars put into data centers. How are they meant to justify doing this other than me? Need money? Please. Even OpenAI admits it's in its own announcement about new Stargate sites that this will be a $400 billion investment over three years. Where the fuck's the money coming from? Is OpenAI really going to absorb massive chunks of all available private credit and venture capital and capex from major tech companies for the next few years and oh my fucking God. Oh my God. Stop saying the US government will bail this out. I'm tired of hearing it. I get that things are scary right now. I'M scared too. We're all fucking scared. But I get jumping to doomerism. But stop. The US government actually really can't afford to do this. OpenAI needs about a trillion dollars in the next four years, and while the US government has spent equivalent sums in the past to support private businesses, there's about $440 billion dispersed during the Great Recession's TARP program. And that was when the treasury bought toxic assets from investment banks to stop them from imploding. Like Lehman Brothers. That one. It's hard to imagine any case where OpenAI is seen as vital to the global financial system and the economic health of the US as the actual banking system. And even if they were, that's more money than they can easily mobilize, even for the US government. And sure, we spent around a trillion dollars, if we're being specific, $953 billion on the paycheck protection program during the COVID era. That was to keep people employed at a time when the economy outside of Zoom and Walmart had, for all intents and purposes, ceased to exist. There was an urgency that doesn't apply here. If OpenAI goes tits up, SoftBank, DragonIR and a few others lose a bit of money. Nothing new there. And Satya Nadella has to explain why he spent tens of billions, actually hundreds of billions of dollars, on data centers fields with GPUs. But otherwise there's. You can't really bail this out. Are we going to nationalize Nvidia? Are we going to create a top fund just for OpenAI? If you really believe that'll happen, I really must put a smile on your face. It can't. Even under the most crony capitalism scenario, this is more money than actually really exists in the world. And yes, while there will be and have been already disastrous economic consequences, they won't be as systematically catastrophic as that of a pandemic or a global financial crisis. To be clear, it'll be bad, but not as bad. And there's also the problem of a moral hazard. If the government steps in, what's to stop Big Tech chasing its next fruitless rainbow? And of course, the optics. If people resented bailing out the banks after they acted like gamblers and lost, how will they feel? Bailing out? Fuck Sam Altman and Jensen Huang. Seriously, no matter when you've got a conservative or democrat government, this is not going to be an easy thing to sell. It's going to be hard to get the consensus, and indeed every tech company will be kind of pissed. I think that you Underestimate how upset companies that have died will be, and indeed companies outside of tech too. This would be more than a scandal. It would be genuinely bad to do, even for the silliest government in the world. I don't think it's happening. And even if they tried, there's not enough money. They can't get you. You're doing a podcast? Look, this has been a slog and I appreciate you sticking with me this long, but the significance of the bubble requires this depth. There's little demand, little real money and little reason to continue. And the sheer lack of responsibility, along with the willingness to kneel before the powerful, fills me full of angry bile. I understand many journalists are not in a position where they can just write this shit sounds stupid, but we've entered a deeply stupid era. And by continuing to perpetuate the myth of AI, the media guarantees that retail investors and regular people's 401ks will suffer. It is now inevitable that this bubble bursts. Deutsche bank has said that the AI boom is unsustainable outside of tech spending, remaining parabolic, which it says is highly unlikely. And Bain Capital has said that 2 trillion in new revenue is needed to fund AI scaling. And even that math is completely fucked as it talks about AI related savings and I quote, even if companies in the US shifted all of their on premises IT budgets to cloud and reinvested the savings from applying AI and sales, marketing, custom support and R and D into capital spending on new AI data centers, the amount would still fall short of revenue, the revenue needed to fund the full investment as AI's compute demands grow at more than twice the rate of Moore's Law. Bain notes, even when stared in the face by a ridiculous idea, $2 trillion of new revenue in a global software market that it and this is all software that's expected to be around $817 billion in 2025. Bain still oinks out some nonsense about the savings from applying AI. Yet another myth perpetuated, I assume to placate the morons sinking billions into this. Every single vibe. Coding is the future. The Power of AI. An AI job story written perpetuates a myth that will only lead to more regular people getting hurt when the bubble bursts. Every article written about OpenAI or Nvidia or Oracle that does not explicitly state that the money doesn exist, that the revenues that are impossible, that one of the companies involved earns billions of dollars and has no path to profitability is an act of irresponsibility, an irresponsible make belief and Mythos. Look, I'm nobody. I'm not a financier. I'm not anybody special. I write a lot, I read a lot and can do the most basic maths in the world. I'm not trying to be anything other than myself, nor do I have an agenda other than the fact that I like doing this and I hate how this story is being told. I never expected my newsletter to get big, nor did I expect this podcast, nor did I expect to be in the financial Times. But here I am and I'm working my ass off and I am pissed off at where this has got to. I'm tired that things remain honestly mythical, that we still see as things get more and more ridiculous, that the headlines get more ridiculous too, that there's questioning and people are saying, oh, the narrative is shifting, sure, but they're still repeating increasingly dumb shit. And I also believe that the way to stop this happening again is to have a thorough and well sourced explanation of everything as it happens, ripping down the narratives as they're spun and making it clear who benefits from them and how and why they're choosing to do so. When things collapse, we need to be clear about how many times people chose to look the other way or to find good faith ways to interpret bad faith announcements and leaks. So how could we have seen this coming? I don't know. Did anybody try to fucking look. Thank you for listening to Better Offline. The editor and composer of the Better Offline theme song is Matosauski. You can check out more of his music and audio projects@matasowski.com m a t t o s o wski.com you can email me at ezeteroffline.com or visit betteroffline.com to find more podcast links and of course my newsletter. I also really recommend you go to chat where's your Ed to visit the Discord and go to R betteroffline to check out our Reddit. Thank you so much for listening. Better Offline is a production of Cool Zone Media. For more from Cool Zone Media, Visit.
- [36:35]
iHeart Podcast Announcer
Our website coolzonemedia.com or check us out on the the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.
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- [38:04]
Julian Edelman
This is Julian Edelman from Dudes on Dudes with Gronk and Jewels. Sunday mornings I've got my game day ritual, coffee, lucky socks, and now new Morning Uncrustable Sandwiches.
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Rob Gronkowski
It's all about that 12 gram protein boost with the new Uncrustables Bright Eyed Berry or Up and Apple flavors.
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Julian Edelman
Bright Eye Berries got a feisty receiver.
- [38:31]
Rob Gronkowski
Energy up an apple. Your classic Do it all tight end.
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Julian Edelman
Soft, pillowy, packed with protein and easy enough for Gronk to grab from the freezer.
- [38:42]
Rob Gronkowski
Whether you're on the couch, driving to the tailgate or heading to the locker room, New Morning Uncrustable Sandwiches are the MVP of snacks.
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Julian Edelman
Your new Sunday kickoff ritual starts here with New Morning Uncrustable sandwiches packed with 12 grams of protein.
- [39:07]
Ed Zitron
Janice Torres here and I'm Austin Hankwitz. We host the podcast Mind the Business Small Business Success Stories, produced by Ruby Studio in partnership with Intuit QuickBooks. We're back for season four to talk to some incredible small business owners. The big thing about working at tech is that it's ever evolving, ever changing. Everyone's a rookie, that's how fast the industry is changing. So what I'm really excited about is to be part of that change. So listen on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.
- [39:35]
iHeart Podcast Announcer
This is an iHeart podcast.
- [39:38]
Ed Zitron
Guaranteed Human.