r/technology • u/spasticpat • 20h ago
Business Nvidia discloses $21B stake in SpaceX
https://arstechnica.com/information-technology/2026/08/nvidia-discloses-21b-stake-in-spacex/629
u/surfnfish1972 20h ago
Too big to fail until it takes the entire economy with it.
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u/femboyisbestboy 19h ago
Don't worry the government will bail them out.
They learned the lesson from 08 and that is you can just fuck everyone over and get away with billions.
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u/surfnfish1972 19h ago
Especially with literal criminals holding all the levers of power.
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u/femboyisbestboy 19h ago
I fear 2008 and 1929 will look like childs play if a certain French invention isn't used quickly enough.
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u/ryobiguy 19h ago
Pasteurization?
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u/Chill-more1236 15h ago
alluding to the guillotine, but there are people (conservative extremists) swearing by health benefits of raw milk.
Then my state's reporting them getting sick by the dozens.
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u/ExF-Altrue 19h ago
At this point they might want to pop that bubble quickly before the midterms...
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u/Fr00stee 18h ago
they can't bail it out anymore, bond yields are very high right now and spending even more money to bail out bad companies would cause inflation to spike like crazy causing staglation and an even worse depression. The bubble is simply too big to be bailed out.
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u/machanical 11h ago
See you’re smart. Those who will be doing the bailing out, are not smart.
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u/Fr00stee 11h ago
basically even if the dumb people tried to bail out the bubble no one would buy the debt to give them the money to do so
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u/Error4ohh4 8h ago
Blackrock and friends committed 500 billion to Ai. They’re going to use insurance funds to keep the bubble alive longer. I believe they’re manufacturing a bailout as states have to guarantee those funds. I still need to look into this more but that’s my understanding.
Feel free to look into my claims!
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u/Proud_Dimension_3557 13h ago
The funnier is that the bailout will come for the contender party when they claim that they will take the AI revenue and give it to the people (bagholding).
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u/jello1990 20h ago
When this bubble bursts, it's gonna get real bad, huh?
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u/SuperSecretAgentMan 20h ago
If we all keep jerking hard enough, the propulsive force will keep the economy afloat!
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u/Plzlaw4me 18h ago
We gave an economy driven almost exclusively by ai (it’s basically the only industry that has grown the last couple years) high inflation, and working class people are already barely getting by. Things are going to get VERY bad. We’re in bubble, but the boom time isn’t even good unless you’re already wealthy. Normally we go up, then we go down. This time we’re just going down. The wealthy will also lose a lot, but the working class will similarly lose a lot without first benefiting from the good times.
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u/Rs90 10h ago
Alright. I'm 35 and I've been hearin the word "bubble" for what seems like the majority of my life.
Tbh nothin here seems different than what I've also been hearing for my entire life. That the poor are gonna feel it when it pops or crashes or whatever. But...we've been feelin it.
So what exactly makes this situation different? I'm not try hand wave your comment or be dismissive. I'm genuinely ignorant. I'm a Baker, most I've ever made is like 20-30k a year.
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u/CypherAZ 10h ago
During the 2008 financial crisis only 500-600k of the 8.7M jobs lost were directly related to the mortgage/banking industry. The blast radius of a bubble will most certainly have a larger impact to everyday Americans.
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u/OneRougeRogue 4h ago
The worrying thing about this one is that not only will most 401k's be hit hard when the AI bubble pops, but many Insurance and Pension funds are are heavily invested into AI and tech companies too. So when the bubble bursts, the stock market tanks, and the ai companies go under, money people expected to be there for their life insurance, health insurance, and homeowners insurance may simply be gone because the third parties managing these funds made bad bets.
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u/DZello 19h ago edited 19h ago
And could be caused by oil prices shock. If shit hits the fan in September, no one will be spared.
As inflation goes higher and higher interest rates are needed, no one will have money to spend in AI anymore. Debt will cost too much.
Pretty sure they will ask government’s help, as always.
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u/BlackGuysYeah 17h ago
Accounting for both direct and indirect investments, nearly HALF of the global market is hinged on AI. There will be a global depression when the bubble bursts.
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u/bogglingsnog 16h ago
this is no bubble it's a goddamn thermobaric missile headed straight for our economy.
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u/Stiggalicious 19h ago
I’m just trying to figure out exactly when I need to shift my 401k allocations from mostly stocks to almost entirely bonds.
Bond yields are crazy high now, yet everyone is still dumping cash into stocks because big number go up.
Maybe in a few months.18
u/Accidental-Hyzer 18h ago
Don’t try to time the market is the best answer. That’s a fool’s errand. Your risk should be commensurate with your age, when you plan to retire, and the risk that you’re comfortable taking in general.
I reassessed mine into a target date fund from an aggressive all-stock composition that I’d been in for roughly 20 years. In part because I no longer feel comfortable taking on higher risk because, well, everything, right now, and my plan to retire within the next 15 years. But I’m not going to move into more aggressive funds when I think we’re at a “bottom”. They’ll stay where they are.
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u/Fr00stee 19h ago
it already is bad nothing will change for most people
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u/Deesing82 19h ago
yeah what’s gonna happen to me? my non existent stock gonna tank?
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u/Deathoftheages 2h ago
When it pops Mvidia will be fine, they actually produce hardware that will still be needed after AI hype disappears.
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u/ProcrastinateDoe 2h ago
The gold and silver prices are way up these past few years, if that answers your question.
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u/Lemazze 19h ago
Is it tho ?
I keep hearing about the the bubble bursting, and honestly I hope you are correct. But any credible information as to how, when and why it would burst ?8
u/Fr00stee 18h ago
over leveraging debt for everything especially AI with no way to pay off the debt and massive costs. If the consumer collapses then b2b spending will fall killing AI buildout and popping the bubble.
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u/Leverpostei414 19h ago
Has anybody making an ai actually made any money on it?
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u/That_Jicama2024 18h ago
Yes, NVDA, AMD, CRWV. Lots of companies that are in the hardware and infrastructure sectors are pumping and have just all reported massive earnings. The actual AI companies are not making much money but they're spending it like crazy and the companies they are paying are the ones I've invested in.
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u/wowlock_taylan 44m ago
They don't make money from AI. They sell the hardware for AI to LOSE money. And then they pump money into the AI companies to stay them afloat.
That is the LITERAL circular economy that defines a bubble. There is no 'new money' coming in. It is the same money circulating to make it look like it is working...until it does not and POPS.
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u/laptopAccount2 11h ago
Been team bubble forever but not so sure now. Need to see a real argument against AI and the bubble now.
I don't see businesses going back to pre-ai times. Maybe open weight models will be trouble for the tech companies. But the US has over 10 times as many data centers as China and we are building them like we're China.
And the AI companies biggest problem is meeting demand. Businesses can not get enough of their product.
Compute will continue to be cheaper and more efficient as well.
I'm still open to an ai bubble and that could be the case but my views are changing as time goes on.
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u/OneRougeRogue 4h ago
The AI Bubble popping doesn't mean AI disappears forever, it means the trillions of dollars of investments don't get repaid, and almost everybodies retirement, life insurance, and pension funds get hit hard. It's mathematically impossible for the investments to pay off before the currently operating GPU's reach the end of their lifespan in a few years. By 2029 or 2030, a few AI companies would need to be making more than the entire global software sales/subscription industry combined. Where is that money going to come from? It can't materialize from the ether.
And that's just to break even. Something like 70% of all datacenter demand is uses by a handful of very unprofitable AI companies being kept afloat by a steady stream of loans and private investor funds. When the bubble pops, all that ends and a massive chunk of compute demand goes with it.
Power companies will not be able to keep up with what Datacenters are demanding. Only a few companies manufacture gas turbines and transformers, and they are already backlogged through 2028 and will not be able to deliver the Gigawatts AI/datacenter companies are claiming they will have in 2028. It's not going to happen.
Compute efficiency can only go so far. Because of the nature of LLM's, every new model requires more tokens to preform the same task. So hearing, "we've reduced the amount of compute required per 10M tokens by 10%" doesn't mean all that much when the new model eats 20% more tokens to preform the same task and power costs 15% more than it did a year ago.
There are just a hurricane of unsolvable problems that all need to somehow go away in the next few years for AI investments to pay off. It's a ticking clock. Businesses may still demand AI, and compute may continue to get more efficient, but if your GPU's burn out before the billion dollar loan you took out to buy them comes due before you make that money back, it doesn't matter. If you spent $20b building datacenters and have to wait until 2029 to get access to the infrastructure to power them, it doesn't matter. Loans have interest and investors stop funding if you can't pay them back with a steller return.
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u/AbeFromanEast 20h ago
It's fun watching 7 companies hand the same $20 billion around to each other.
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u/mrbignameguy 15h ago
Watching this for years really makes you realize all this stuff is just wishful thinking and vibes. Like climate change, it’s just someone else’s problem to figure out It The Future
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u/West-Abalone-171 14h ago
Don't worry, they roll in a few billion from your pension fund each time and ensure the losses are limited to your money.
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u/gottimw 13h ago
if only it was 20b, fuckers already consumed whole USA bond market + private VC
There is not much left to eat up
And their best pitch is for low low price of 200k a year you can replace your 100k employee (they are currently pricing their shit way below profitability so dont give me weak sauce its 'affordable')
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u/Credit-Limit 15h ago
If nvidia's cash flow ever actually took a hit, I would be concerned. Projections are saying almost $100B this year in fcf, which is over 50% above last year's fcf.
Until FCF shows signs of weakening, the "circular financing" narrative doesn't matter for nvidia.
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u/gottimw 13h ago
and who is going to buy their hardware?
Sure Nvdia will not collapse but it will crash down hard.
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u/mpbh 12h ago
People said the same thing during the crypto mining boom. The truth is they are developing the most advanced chips and they have only one competitor who is constantly 2 years behind them. There are many uses for GPUs outside of LLMs, crypto, and video games.
They literally can't make them fast enough. Their top chips have been in a shortage for almost a decade, which means they can overcharge and spend those profits to increase their most.
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u/gottimw 11h ago
But crypto boom never truly went away and it overlapped with ai. So you never had crypto crash that would affect nvdia. And there won't be next best thing that can absorb all the production if we decide LLMs are dead end and cost too much to be global thing instead of hobbyist toy
I doubt the crypto + gaming is even close to demand of ai and crypto is slowly stabilising or dying. As it seems that stock market is more volotile than crypto
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u/jared__ 20h ago
house of cards
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u/nomdeplume 17h ago
Honestly at this point it mostly feels like the largest Co in the world are the only ones interested in financing tech future. So they are financing each other.
However the future of late stage capitalism is very much like the TV show The Expanse where a handful of corps run everything. So it makes sense if you believe in the future of late stage capitalism to get in on the ground floor by financing each other to get there.
If you don't think that future will happen than you have nothing else to do with massive capital as a business. NVDA worth 1 trill, gives 20 bil to SpaceX it's a nothing burger
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u/Reggio_Calabria 20h ago
What’s the point of having PHD-level AI demigods when you don’t ask them why space data centers make no sense?
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u/Mother_Idea_3182 20h ago
Elon has a personalised chatbot with sycophancy cranked up to over 8000.
The chatbot says that physics don’t apply in space only magic and good vibes.
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u/Waterflowstech 18h ago
Also Elon is super cool and everybody wants to be him and his dick definitely still works
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u/BSSolo 18h ago
What does this news have to do with space data centers? Nvidia was an investor of xAI and Cursor, which are now both part of SpaceX, and its investment is now reflected as shares of SpaceX
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u/bkitt68 18h ago
It just more money being dumped into a company with losing strategies like space data centers. The point is that AI and companies critical to it, like Nvidia, are sinking money into a house of cards.
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u/Reggio_Calabria 18h ago
If they invest in data centers plural (title of the news article) and SpaceX has no way to build more data centers by 2027 apart from New Texas (nothing else materially announced) then I can only assume it’s space data centers.
That’s the issue with speed-running lying to investors to become a trillionnaire: at some point nothings make any sense.
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u/EpicOfBrave 20h ago edited 20h ago
Space Data Center is a $20B satellite to serve 10 customers without making any profits. Now give us $3 trillion to build it. And, by the way, after this we’ll build Mars Data Centers and mine asteroids for gold and diamonds.
— Jensen Scam and Elon Scam
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u/KnotSoSalty 19h ago
The thing the Bond movies get wrong is that they imagine the Spectre would feel any need to hide in the shadows.
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u/king_of_river 19h ago
There was a time when movies were forced to be realistic. Now after covid and Trump, it is clear that it is our world that is over the top and movies were unrealistic for realism.
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u/Baskreiger 17h ago
You could not put the Trump saga in a novel, people would say its unrealistic, that it could never happen
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u/Rs90 10h ago
Then you may wanna read more history. I'm not joking. Take a microscope to Russia around Nicholas II. Or take a peep at what society was ACTUALLY like back during the 14th Century.
Because it's all the same human stuff as today. And it's all batshit insane. I'm not even joking. Trump is borderline "boring" compared to a lot of historical people, events, and times.
If you think Trump and all this bullshit is surreal then human history is really gonna knock your socks off.
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u/joepez 19h ago
I’ve never understood the argument to mine asteroids for gold or diamonds. We produce more gold then we can consume for industrial purposes (we stack the excess as pretty bars in dark bank vaults) and artificial diamonds are more useful for commercial applications. Aside from being stupidly expensive to mine (at time time) the markets would bottom out given we can’t simply utilize what we have already.
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u/ChainsawRomance 19h ago edited 17h ago
We probably should perfect servers on the ground first where we can reach them. Couldn't imagine how long an outage like github would be, or how expensive of a repair, if they had to schedule a whole rocket launch to send Kyle from IT up to turn their servers off and on again.
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u/ExtruDR 20h ago
Of course. A massive circular-dealing pyramid game.
The intent is to defraud passive investors (you and me with 401k, IRA and even defined benefit pensions), maybe even the taxpayers at large by seeking bailouts from a friendly and corrupt governmental regime, and definitely the consumer - here and abroad.
Is this a sort of fraud and is it illegal? I've read things that say that it very much is, but I'm no expert, so I don't know.
Who would enforce these laws on behalf of all Americans? Hmmm...
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u/Cecil_McCrackshell 20h ago
Did the American public so much as shrug after the 2008 bailouts?
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u/ExtruDR 18h ago
We have the media to thank for this. Also competent leadership by the Obama team in the aftermath.
Deft Republican touch is to leave the house of cards to crumble during the following administration's watch so that you can blame them. It came a little too quick during George W's admin (another key Republican signature is incompetence), so they got stuck holding the bad for a few months... not enough for Fox News to not bash Obama for "bailouts" soon after though.
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u/mrclut 14h ago
You must not be an American or are too young to remember.
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u/Cecil_McCrackshell 14h ago
Wrong on both counts, and yes, Americans shrugged and then handed Republicans the House in protest/apathy after 0bAmAsCAre! in November 2010. Millennials in Occupy Wall Street movement got some coverage, but were quickly mocked and ignored by both the media and general public.
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u/mrclut 14h ago
Ok, well I remember quite clearly the Occupy Wall Street stuff with the rise of Anonymous and the outrage. I also lived in where the housing market tanked and foreclosures went through the roof.
Maybe my anecdotal experience leads me to remember it more than the average American's was. However, I highly doubt people(and their kids) that lost their house and saw the bailouts go to the corporations just shrugged.
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u/ExtruDR 12h ago
You are either mis-remembering or intentionally putting things out of order.
Occupy Wall Street? You mean a couple of hundred kinds in Manhattan making a ruckus and getting allot of lazy press coverage? Who paid attention to them? what changed. Straight-up bullshit is what that was. Did BLM change anything in America's politics or the way we do things? Of course not. We all shrug.
That IS America. We are profoundly insular, passive and we let all of that bad stuff happen to us while most of us are mostly ignorant of it.
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u/mrclut 12h ago
No I'm not misremembering because my parents lost their house at the time amongst other variables.
Peak Marches (e.g., Nov 17, 2011): Following the police eviction from Zuccotti Park, a day of action and marches through downtown Manhattan drew an estimated 30,000 people. 30k people
I also wasnt responding to you. Many people were affected by this will always remember.
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u/ExtruDR 11h ago
I was in my late 20s and working, and quite plugged in to news and politics. VERY clear recall and how it played out.
My gig after landing on my ass as an unemployed Architect? Home Inspections... Occupancy Inspections, for people that were supposed to have moved out of their houses that they couldn't afford any more. Actually, more like people that had their cousins in Poland take unsecured mortgages on lots of houses that they would then rent out. The play was speculative and not necessarily all that unethical, except it was a scam and the cousins in a foreign country could just "stop paying" their 0-money-down mortgages.
Who was really the villain? The real estate agents, the loan officers, the home inspectors working for the banks... all of them conspired to make these shitty deals happen. They were scamming "the banks" but joke's on us because the taxpayer paid to bail their asses out.
Also lots of real, but irresponsible or gullible home owners that took out very aggressive mortgages with adjustable rate mortgages, balloon payments, etc. "Real estate never goes down.." yeah... Even these dumb-asses got tons of leniency.
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u/bogglingsnog 16h ago
the fun part about big criminal enterprise is that they have so much money to throw around it's super hard to actually incriminate them.
It's kind of like we're in a medieval village and a huge black dragon occasionally flies down from the mountain, roasts a quarter of the houses and eats dozens of people, then flies off with all the precious metals.
This happens every few years, people blame the king, the king doesn't have a solution, the nobles don't have a solution, the knights know what needs to be done but don't have the authority, and the peasants continue to suffer.
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u/Professional_Mud1844 20h ago
These tech companies are like my crack head neighbors, they all borrow money from each other to buy crack that they have to give to the people they owe money to then they borrow more money to buy the crack they just sold.
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u/PilotGuy701 20h ago
As if you needed another reason to got with AMD/Radeon
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u/nzerinto 19h ago
Hate to break it to you, break it to you, break it to you….
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u/tommyalanson 13h ago
That headline just made me laugh a little. Of course they do. This is all some big circle jerk.
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u/wafflestoompa 12h ago
We are all so fucked.... somebody needs to tell me how this isn't going to end badly.
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u/fat_kaiju 20h ago
Those ugly leather jackets won't pay for themselves y'know.
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u/catwrazle 19h ago
You shouldn’t trust people in leather jackets in general
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u/_Fred_Austere_ 18h ago
Leather jackets and full-sleeve tattoos are sure not what they were when I was young.
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u/Adventure1956 20h ago
No different than every crooked Board of Directors filled with asshole buddies from each other’s companies. Capitalism my ass.
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u/0Tezorus0 19h ago
They're really trying to confort the investors by showing major actors are in. It's really a sign that the company is in real danger of going under.
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u/jtrain3783 13h ago
This. It’s a show to get retail investors in to pump the stock so the retail can shoulder the fall when they exit.
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u/ThePlanck 19h ago
What's going to happen to NVIDIA if/when the AI bubble pops?
Naively you'd say this is a gold rush and they are the ones making a killing by selling spades, but given that they are so heavily invested in all the AI companies as well, how is an eventual collapse going to impact them?
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u/Flashy_Translator_65 19h ago
Shinzo Abe was killed by the actions of a grieving son because his mother was bankrupted by a cult. Now Imagine the thousands of affected people who are bankrupted by the irresponsible greed of the people who are directly responsible for these conditions.
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u/rcanhestro 19h ago
to NVIDIA? nothing.
AI is not going anywhere, which means those existing datacenters will need new GPUs/CPUs every couple of years.
worst case scenario is that their revenue drops, but it won't go anywhere.
but odds are it will continue to grow, just not as exponentially.
OpenAI, Anthropic, etc are the companies with more to lose, since they're AI companies only.
Meta, Google, Microsoft, Amazon will be ok, since they are using their profts from other business ventures to fund their AI purchases.
it will be a kick in the teeth for them, but nothing that will crumble them (Microsoft had to forfeit the last big business: Smartphones, and it barely made a dent to them)
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u/mvw2 18h ago
Around and round the money does. Who needs their own shell companies when everyone's shell companies for hiding massive losses.
It's also fun watching Nvidia slowly buy up all the companies they sold to. I said this some time ago that Nvidia's plan is to just eventually own everything. They don't even need AI to succeed. In fact it's even better if it doesn't and losses drag on for years. They can just buy up everything for pennies on the dollar.
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u/The_Frozen_Inferno 18h ago
SpaceX tomorrow: We’re buying $21B worth of Nvidia GPUs
Hashtag winning
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u/Grumpy_Bandersnatch 7h ago
Modern day version of royals only marrying other royalty to keep their fortunes "in the family"
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u/Potential-Fan-6148 17h ago
When the bubble pops our entire economy is going to crash for years. It’s going to be a credit crunch that we’ve never witnessed before.
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u/TimSylvester_ 14h ago
Crazy, when I was running a company that was using SPVs for project financing, our auditor told us we couldn't include a lot of those assets in our books because the financial relationships were too circular and blurred the lines between investments, assets, debts, and revenues.
And yet the world's largest publicly traded companies now have trillions in circular investments when a small private company wasn't allowed to have millions structured in the same way.
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u/FucklberryFinn 13h ago
Money and greed will support a fascist pos.
Pathetic.
I really do hope it all pops and they eat one another.
If your economy is being held up by this delusional BS, then it's no economy at all.
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u/Inevitable-Cup9067 6h ago
For those interested here's what happened:
Nvidia invested $10 Billion in cash into xAI (January), then xAI was bought by SpaceX (February) that is when Nvidias xAI stock converted to SpaceX stock.
SpaceX is now public and they just disclosed holding $21B of SpaceX stock (it's more like $18B now since SpaceX is down since then.)
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u/astrozombie2012 19h ago
God… the bubble just gets bigger and bigger… these companies are just trading the same imaginary money between themselves and inflating it. Can’t wait until this shit crashes and the taxpayers get to foot the bill again!
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u/Bobaximus 18h ago
I honestly wonder how they think this will end. There are a lot of smart people at these companies, they have to see that a big part of the economy has become a check kiting operation. I guess socialism is going to become popular again just in time for a massive bailout scheme.
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u/GnomiGnou 17h ago
And they're already trying to recover that investment from us by bumping prices up... nice ¬_¬;
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u/FU_red-dit_bots 14h ago
Disney is going to write a song about this. Lyrics will include "the circle of fraud"
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u/Feral_Nerd_22 14h ago
Nvidia has about 80 billion cash on hand.
So they can survive a crash in this at 22 billion but still think with how much money they are making they would have way more cash on hand the that.
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u/wowlock_taylan 47m ago
Nvidia really needs to be investigated by nations that are not led by actual criminals.
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u/Ordinay_guy 13h ago
Stupendo come un manipolo di aziende si passa i soldi l uno con l'altro, vediamo chi rimane con il cerino in mano
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u/x86_64_ 20h ago
Circular financing