| ▲ | nemomarx 2 days ago |
| What's the downside of that for the economy? It seems like it would be the market becoming more efficient, cutting down on margins and so on. Bringing Nvidia back to earth might open up cheaper hardware for other companies to work with and accelerate AI anyway. |
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| ▲ | kphorn 2 days ago | parent | next [-] |
| Efficiency is a great thing and long term what’s needed so we can buy laptops again at a reasonable price. There will be a pretty large blast radius across ANT/OAI/ORCL/SPCX/TSMC/neoclouds. Prob 15T of market value at risk and the flywheel of investment which is conditioned on investors and the economy believing they have durable appreciation locked up in AI stocks (“if my basket of investments is safe, I’m willing to invest my next dollar in more of it” vs “the sky is falling and I need to tighten the belt / pull money out”). I’m trying not to be a doomer here as I think it’s somewhere in the middle it’s just very frothy and the upside scenarios generally envisioned NVDA to be stable |
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| ▲ | ihsw 2 days ago | parent [-] | | I will be honest, my personal opinion is keep the blood flowing until RAM prices return to Sept 2025 levels. This whole saga has been a ridiculous waste of everybody's time and energy. There's no compelling argument that points to these new innovations not otherwise happening if RAM prices weren't artificially inflated by the fever dream of private equity. | | |
| ▲ | goodmythical 2 days ago | parent | next [-] | | How is nvidia crashing out going to reduce RAM prices? The demand for high-ram consumption applications is higher than ever and rising. That demand is not created by nvidia, but nvidia's customers. nvidia's customers are buying nvidia parts built with other's ram because they have customers renting the compute. Whoever nvidia is buying ram from will simply sell to the next highest bidder, and the ram will still be sold out through the coming years. | | |
| ▲ | zanderwohl 2 days ago | parent [-] | | Because Nvidia is personally investing in a huge amount of those customers, enabling the hyperscaling. If half of the circle breaks, the other half does too. | | |
| ▲ | keybrd-intrrpt a day ago | parent | next [-] | | And those customers still have the demand to keep wanting more. Contrary to the AI-bubble-doomsayers - most hyperscalers and neoclouds seem to be at capacity for current demand and even have already booked future demand. | |
| ▲ | anon7725 a day ago | parent | prev [-] | | > If half of the circle breaks, the other half does too. If the good Lord's willing and the creek don't rise. |
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| ▲ | hatethehate a day ago | parent | prev | next [-] | | RAM prices are not artificially inflated. Everyone wants to run models that require 1TiB of RAM locally. AI agents utilize RAM on every computer more than ever before. The fever dream is imagining these prices are ever coming back down without serious fab investment. | | |
| ▲ | TheGamerUncle a day ago | parent [-] | | There is blatant and open collusion between everyone that can invest in fabs in order to "slow down" the investment and the supply in order to maintain the prices as high as possible, as long as possible. https://finance.yahoo.com/technology/articles/ram-crisis-one... "The lawsuit also points towards similar collusion between the companies in the past. In 2005, SK Hynix and Samsung were fined $180 million and $300 million respectively after pleading guilty to price-fixing DRAM pricing. It is suggested that the same occurred between 2016 and 2018 when prices spiked again, ..." |
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| ▲ | kphorn 2 days ago | parent | prev | next [-] | | Agreed. We all want a soft landing. | |
| ▲ | parineum 2 days ago | parent | prev | next [-] | | > if RAM prices weren't artificially inflated by the fever dream of private equity. RAM prices are a result of skyrocketing demand. That's hardly a fever dream. You can hardly blame RAM suppliers for taking the money of people who are coming to them begging to pay more than the person before them in line. It's not like they are squeezing the market in some cartel price-fixing racket.It's the customers who are willing trying to pay more for better access.
The innovations and the price of RAM are so non-sequitur at this point; I can't understand what point you're making. Sure, if RAM were as easy to get as the circuit boards they're being put on, innovation would be the same (or accelerated!) but that doesn't have anything to do with the fact that RAM is incredibly supply constrained and ramping production to meet the demand of a seemingly insatiable market takes a long time for a product this complicated and specialized. If any of the manufacturing companies could have seen this coming, they'd have started ramping production to insane levels 5 years ago, and they'd be taking in just as much money as Nvidia is. | | |
| ▲ | throw-qqqqq a day ago | parent [-] | | > It's not like they are squeezing the market in some cartel price-fixing racket You don’t know this with certainty, do you? https://en.wikipedia.org/wiki/DRAM_industry_price_fixing | | |
| ▲ | quickthrowman a day ago | parent | next [-] | | This time is purely supply and demand. Companies (CRWV, etc) are borrowing at 10%+ interest rates to buy NVidia GPUs that NVidia makes 75% gross margin on. I repeat, companies are selling junk bonds to buy GPUs at a 300% markup. Cocaine dealers probably don’t even make 75% gross margins. Other companies (OpenAI, etc) are also borrowing at 10%+ interest to rent the GPUs to train LLMs. All of these GPUs need a ton of RAM. There is a fixed supply of RAM. There is insane demand for RAM. | |
| ▲ | brookst a day ago | parent | prev [-] | | What in the world does a 20-year-old scheme and prosecution have to do with it? Besides, when demand outstrips supply you don't have to fix prices. Why would you? They cannot deliver all of the RAM people want. Think about it for a minute: how would price fixing even work? (and don't get me started on the ridiculous "they're switching from DDR3 to HBM" part of that wikipedia article...) | | |
| ▲ | throw-qqqqq 19 hours ago | parent [-] | | > What in the world does a 20-year-old scheme and prosecution have to do with it? My point is that we don’t know for sure. DRAM manufacturers have admitted to price fixing previously, and it’s the exact same companies that produce RAM today. If you search for “price fixing cases in hardware”, you will find plenty of guilty pleads from other/unrelated HW companies that are more recent. Price fixing happens and sometimes they even get caught doing it ;) > Think about it for a minute: how would price fixing even work? In the past, it worked by manufacturers collectively agreeing on price quotes and margins IIUC. I’m not claiming any foul play. I’m saying we can’t know for sure and it’s happened before. |
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| ▲ | landdate a day ago | parent | prev [-] | | [dead] |
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| ▲ | pizzathyme 2 days ago | parent | prev | next [-] |
| It’s not a given that markets are able to navigate the risk between massive capital investment and unknown future revenues. Everyone is trying to figure out the long term value from AI. For a made up numbers example the path might require $1T investment to unlock $10T revenue in 10 years from now. But if no one can put up the $1T it stalls and doesn’t happen next decade |
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| ▲ | randbyte 2 days ago | parent | prev | next [-] |
| It’s the wrong way by having a neutered market leader instead of strengthened competitors. |
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| ▲ | pembrook 2 days ago | parent | prev | next [-] |
| The hardware is expensive because it's supply constrained. Demand far exceeds supply. Harming Nvidia would only make us more compute constrained, and raise prices further. It seems it's impossible to get a certain type of person to understand this regardless of whether it's housing, education or chips. Harming the producers of [thing] or disincentivizing profits will not make [thing] cheaper if demand remains the same (or if it is growing, like in all of the areas I mentioned). |
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| ▲ | nozzlegear 2 days ago | parent [-] | | > It seems it's impossible to get a certain type of person to understand this regardless of whether it's housing, education or chips. What type of person are you referring to? |
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| ▲ | tsunamifury 2 days ago | parent | prev [-] |
| Have you ever considered that an efficient economy is you paying everything you have for food and living in absolute poverty |
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| ▲ | jimbokun a day ago | parent [-] | | That doesn’t seem to fit any definition of efficient I can think of. | | |
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