There’s plenty of second order effects. What would this do to the insurance or pension firms who hold this debt? The banks who hold this debt? Also a lot of this debt is possibly held by smaller players who would get wiped out.

The GFC “proper” was the dramatic crash in the liquidity of credit markets, not strictly a corollary of the losses on property and mortgage-backed securities.

Makes sense, when a crash happens liquidity will be terrible -- almost by definition, as the hyperscalers won't have the cash on-hand to make good on their debts. But what I'm trying to understand is exactly what happens to those who are holding that debt, given that the debtors will soon be making a lot of money again (from their pre-AI businesses)?

Won't the debt-holders have some claim to that future cash flow to be made whole?

> What would this do to the insurance or pension firms who hold this debt?

If the debt is serviced, nothing.