I've had this conversation too many times to not make a meme out of it.
this post was submitted on 18 Jan 2026
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AI, in this case, refers to LLMs, GPT technology, and anything listed as "AI" meant to increase market valuations.
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All this bullshit is for line go up. And its mostly working, so far.
However, the bankers heavily involved in financing AI datacenters have become nervous and started approaching insurance firms for coverage in case the projects fail.. And the hedge funds have had low, 0 or negative ROI for the last ~4 years due to the prior failures of the Metaverse, NFTs, and now AI not paying off yet.. So new funds are drying up on two fronts, and if they don't magically become profitable in the next year then the line is gonna go down, hard.
Mind sharing some sorces? Not that I don't believe you, I just want to read more good news.
Asking for sources is always welcome with me.
Here's a deep dive from Ed Zitron into the whole AI/LLM industry that details the heavy investment from several key banks (Deutchebank being one), and the shrinking finance availability from traditional means (bank loans, hedge funds, managed funds). It's long but it's really worth a read if you have a spare hour or so.
https://www.wheresyoured.at/the-enshittifinancial-crisis/
A glaring tell that I don't recall him highlighting is that the hyperscalers have largely outsourced the risk of AI investment to others. META, Google, and Microsoft are making small bets on AI comparitively - they're using cash assets they have as profits from other business models, which are still significant (measured in low billions) but dont require them to take loans or leverage themselves. This means they are playing it very cautiously, all the while they're shoving AI into all their products to try to make it seem like they're all-in and it's 'the next big thing', which is helping their stock prices in the investor frenzy. Most of the investment capital required for the AI boom is going into hardware, datacenters and direct investment in the software development - and that's mostly being avoided by the big guys. This allows them to minimize risk and still having a decent win if it takes off. Conversely If/when the bubble bursts they'll still take a hit, but they'll also still be making money via other streams so it'll be a bump in the road for them - compared to what will happen to OpenAI, Athropic, Stability, the datacenters and their financiers.
https://archive.is/WwJRg (NYTimes article).
Tbh the datacentres are least concern given how readily those structures and equipment can be pivoted to other uses. Be a helluva fire sale though.
The issue around them is more being built on time, as they have tight contracts with the scalers that allow them to simply not pay their interval payments or even pull out of the contracts entirely if delivery dates are delayed.
They're bespoke too - which is why they're getting 'AI datacenter' builds instead of approaching existing datacenters. AI racks require up to a megawatt per rack. That's insane. They have been custom designed and built by UPS and power companies.
https://blog.se.com/datacenter/2025/10/16/the-1-mw-ai-it-rack-is-coming-and-it-needs-800-vdc-power/
Yes, they could be pivoted away from AI to host 'something else', but it won't help save the companies that built them get paid, because they'll only be using a small fraction of their power delivery, and the $20,000 AI GPUs have pretty limited use-cases. It will be a massive oversupply issue causing all the datacenters hosting prices to have to drop drastically to get any businesses even into their tenancies. This will cause those hosting companies (which are up to their gills in loans) to go under - They're the ones taking the big risks on AI. Not Meta/Google/MS/etc.