bubble boi

عاجل | القناة 12 الإسرائيلية عن مسؤول إسرائيلي كبير: انتهى الاحتواء وإسرائيل اتخذت قرارا بتوجيه ضربة كبيرة لحزب الله

Huawei just fired a warning shot at the entire semiconductor industry. The West assumed cutting China off from ASML’s EUV machines would freeze them out of advanced chips. Huawei’s response: “Fine. We’ll redesign the rules.” Their new “LogicFolding” architecture claims it can achieve 1.4nm-class performance WITHOUT EUV lithography by 2031. If this works, it changes everything: • TSMC’s dominance gets challenged • US sanctions lose leverage • Architecture becomes more important than transistor shrink • The AI hardware race gets rewritten This is the most important semiconductor story since the chip war began. The real battle is no longer just who can make smaller transistors. It’s who can extract more intelligence per watt, per mm², per supply chain constraint.

Gavin Baker built a massive position in $ALAB around the AI infrastructure theme, and the stock has now crossed $300. He thinks AI is different and that we are NOT in a bubble. He expresses this thesis behind many of his top holdings, including $NVDA, $MU, and $AMZN.

This episode shows me how insanely little Dwarkesh knows about hardware and has made me second guess his intelligence on the other levels of the abstraction stack. Also the dude lecturing is not communicating very well. This whole episode is very clearly an ad for MatX and a poor one at that because the founder clearly has certain gaps in his hardware knowledge

People underestimate xAI at their own peril. They’re the real wild card in the AI race, and the bigger picture reveals an actual strategy to not just leapfrog the competition but to become the only winner in AI. It’s eerily similar to the playbook John D. Rockefeller ran with Standard Oil. If you look at the funding picture today OpenAI just raised $122B (that they’re lighting on fire) and Anthropic has raised ~$72B in its entire lifetime. xAI in comparison has raised meaningfully less than either. But xAI somehow already has the most compute online right now, and the capital structure is about to flip that’s going to turn them into one of the largest free cash flow machines in history. SpaceX filed its S-1 last week targeting a ~$75B raise at a 1.72 trillion valuation and although most of that is going to go to Starlink and Starship, the detail many are missing is that xAI now sits inside a public-company balance sheet with access to huge institutional debt markets that pure AI labs don’t have. OpenAI and Anthropic have to keep selling equity to fund compute while xAI can issue investment-grade paper against Starlink’s $4.4B in operating income, giving it a dramatically lower effective cost of capital which is critical in this gold rush to expand compute infrastructure and capture market share. If you then look closer at the Colossus deal with Anthropic xAI gets ~$40B to rent out their old infrastructure which allows them to monetize a depreciating asset at a higher rate than they were getting from internal use, as well as control a competitor’s inference economics, and recycles the cash into Colossus 2. This is a Rockefeller move no doubt. What many don’t understand is that Standard Oil didn’t just refine oil. It owned the rail rebates which in turn made their competitors pay them every time they shipped a barrel. Rockefeller’s rivals literally funded the monopoly’s expansion and similar to today with a severely supply constrained compute market anyone with cheap power right now can pull such a move (Colossus taping into the Natural Gas pipeline was another genius move for many other reasons). This matters a lot more than people think right now because we are still in the blitzkrieg part of the AI build out but as we shift from training to inference, compute capacity will directly equal revenue capacity. The pre-training benchmark game the AI labs are playing right now is hitting marginal returns. The customer-serving game is just starting, and whoever has the most power online and the best economics wins it. When you factor in the SpaceX IPO, public debt access, $40B of incoming Anthropic revenue (and many more deals to be announced soon I believe) as well as the first operational gigawatt cluster with Colossus 2 we are going to see a sea change in the industry. Power, uptime, and compute access will be all that matters. If I am right I expect consolidation with the big AI labs and AI services. The recent mergers & buyouts with SpaceX are just the start.

a citadel quant told me something that broke my entire trading framework "we don't predict markets. we model the state machine" he explained markov chains in 90 seconds the market is never random - it always exists in one of three states trending up, trending down, ranging - each has a fixed probability of shifting to another build the transition matrix from real price data: > trending up -> 68% stays trending, 21% flips to range, 11% reverses > ranging -> 54% stays range, 28% breaks up, 18% breaks down > trending down -> 61% stays falling, 24% flips to range, 15% reverses now you're not guessing, you're playing probability identify current state, enter with the 68% edge, size with kelly criterion based on that probability the formula is public - markov published it in 1906 hedge funds use it, the math costs nothing what costs you is asking the wrong question "where is price going?" is random "what state am I in right now?" has an answer transition matrix built from 10 years of data is your edge Bookmark it not a signal, not an indicator - just conditional probability that compounds every single trade