{"id":3851,"date":"2025-10-09T12:15:44","date_gmt":"2025-10-09T12:15:44","guid":{"rendered":"https:\/\/marketsfortress.com\/index.php\/2025\/10\/09\/the-ai-booms-reliance-on-circular-deals-is-raising-fears-of-a-bubblea-web-of-dealsthe-doomsday-scenarioso-much-money\/"},"modified":"2025-10-09T12:15:44","modified_gmt":"2025-10-09T12:15:44","slug":"the-ai-booms-reliance-on-circular-deals-is-raising-fears-of-a-bubblea-web-of-dealsthe-doomsday-scenarioso-much-money","status":"publish","type":"post","link":"https:\/\/marketsfortress.com\/index.php\/2025\/10\/09\/the-ai-booms-reliance-on-circular-deals-is-raising-fears-of-a-bubblea-web-of-dealsthe-doomsday-scenarioso-much-money\/","title":{"rendered":"The AI boom’s reliance on circular deals is raising fears of a bubbleA web of dealsThe doomsday scenarioSo. Much. Money."},"content":{"rendered":"

Nvidia plans to invest in OpenAI<\/a>, which is buying cloud computing<\/a> from Oracle, which is buying chips from Nvidia<\/a>, which has a stake in CoreWeave, which is providing artificial intelligence<\/a> infrastructure to OpenAI.<\/p>\n

The AI boom that is revolutionizing how people live and work<\/a> has become increasingly fueled by just a handful of companies turning to one another for the vast amounts of capital and computing power needed to drive their breakneck growth.<\/p>\n

<\/div>\n

Some of those partnerships are worth up to hundreds of billions of dollars. Taken together, they have enormously increased the companies\u2019 values, helping send U.S. stock indexes to new highs<\/a>. <\/p>\n

But as AI investing grows more insular, there is also a risk that the money flowing between these companies is creating a mirage of growth. <\/p>\n

If the trend accelerates, some analysts warn, a weak link could threaten the viability of the whole industry \u2014 leaving an outsized mark on the U.S. economy.<\/p>\n

\u201c\u200b\u200bThe experience of a quarter of a century ago [when the dot-com bubble burst] won\u2019t necessarily be repeated, but the scale of recent investment increases by tech firms already indicates that they are taking significant risks,\u201d analysts with Oxford Economics research group wrote in a recent note. <\/p>\n

If it starts to become clear that AI productivity gains \u2014 and thus the return on investment \u2014 may be limited or delayed, \u201ca sharp correction in tech stocks, with negative knock-ons for the real economy, would be very likely,\u201d they wrote.<\/p>\n

The latest example of that network of investments came Monday, when OpenAI \u2014 the maker of ChatGPT \u2014 announced a deal with artificial intelligence chipmaker Advanced Micro Devices, or AMD. <\/p>\n

Under the terms of the OpenAI-AMD partnership, OpenAI will purchase AMD\u2019s chips for an undisclosed sum in exchange for the right to take a stake of as much as 10% in the semiconductor giant. <\/p>\n

The announcement came just weeks after Nvidia unveiled a deal under which it pledged to invest up to $100 billion<\/a> in OpenAI.<\/p>\n

\u201cExcited to partner with AMD to use their chips to serve our users!\u201d OpenAI CEO Sam Altman wrote on X<\/a>. AMD and Nvidia are direct competitors.<\/p>\n

An Nvidia spokesperson did not immediately respond to an inquiry about whether any OpenAI funds would be used to finance buying its competitor\u2019s chips.<\/p>\n","protected":false},"excerpt":{"rendered":"

Nvidia plans to invest in OpenAI, which is buying cloud computing from Oracle, which is buying chips from Nvidia, which has a stake in CoreWeave, which is providing artificial intelligence infrastructure to OpenAI. The AI boom that is revolutionizing how people live and work has become increasingly fueled by just a handful of companies turning <\/p>\n","protected":false},"author":0,"featured_media":3852,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-3851","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"_links":{"self":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts\/3851","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/comments?post=3851"}],"version-history":[{"count":0,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts\/3851\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/media\/3852"}],"wp:attachment":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/media?parent=3851"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/categories?post=3851"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/tags?post=3851"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}