How would going leveraged on the S&P 500 because they expect long term rapid GDP growth help them with short term cash flow to invest in AI training that will enable that rapid GDP growth?

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pembrook 31 minutes ago | parent [-]

Because the market is forward-looking, and brings all future cashflows to the present.

If it became clear by 2027 that GDP growth would permanently reach 15% (I didn't make that absurdly stupid chart, they did), S&P 500 valuations would immediately 100X or more.

They could take out a credit line against those gains and have unlimited money.

Wait...are you suggesting those predictions might be so unrealistic that its stupid to even publish them? I'm shocked!

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ummonk 19 minutes ago | parent [-]

Are you saying that instead of investing in training right now they'll get higher ROI by pausing training for a year, and investing their money into taking out long positions on the stock market, all on the hope that what they label the "Extreme scenario" comes to pass?

	▲	pembrook 9 minutes ago \| parent [-]
		If even their modest scenario becomes consensus by next year, the market will 2X or more. They could easily leverage that to 10X returns. Their business is not going to 10X cash flows next year, so yes, that would be the smart move if they thought even the short term modest scenario was happening. They don't think that though. Hence why this blog post is stupid to even publish. It's like me publishing a "What will our future look like?" blog post where I think I'm the center of the universe and draw a chart that says: Modest scenario: I take a bowel movement so big it opens a wormhole and destroys humanity