Circular financing ain't what it used to be

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• Core argument: the AI boom has been propped up by circular financing (chipmakers/cloud vendors bankrolling their own customers) rather than real profitability, and investor confidence in that model is now cracking.
• Recaps the Oracle precedent: the September 2025 $300B Oracle-OpenAI deal sent Oracle stock up 43% (Larry Ellison’s wealth briefly +$100B); Marcus had called it “Peak Bubble” the next morning — stock later ran to $328 before crashing to about $120.
• Contrasts that with Nvidia’s proposed $250B financing backstop for an OpenAI data center, which instead triggered a 4.5% Nvidia stock drop and open skepticism — an investor is quoted calling the arrangement “two drunks leaning on each other to stand up.”
• Notes creditors are growing wary, pushing toward off-balance-sheet and “creative financing,” while Apple has overtaken Nvidia and SpaceX is down 50% from its June highs.
• Practical takeaway: “hope and circular financing” can no longer sustain AI valuations absent real demand and profitability — a reckoning is arriving for the sector.