THE AI BUBBLE – OR HOW THE MARKET IS LOSING ITS MIND IN REAL TIME

The AI market is at peak euphoria. Companies are signing multi-billion-dollar deals, swapping equity stakes, pumping capital – all under the banner of a “new technological era.”
But behind the flashy headlines and ever-growing numbers, the same old symptoms are reappearing – the ones we saw in the late ’90s, right before the dot-com bubble burst.

DEAL OF THE YEAR: AMD × OpenAI

On Monday, $AMD officially announced a multi-year partnership with Microsoft-backed #OpenAI to supply 6 GW of GPU capacity for future AI infrastructure.

The first wave will include 1 GW of Instinct MI450 chips, with rollout scheduled for the second half of 2026.

The key detail: warrants for $AMD stock.
OpenAI will have the right to buy 160 million $AMD shares (roughly 10% of the company) at a symbolic price of $0.10, provided several conditions are met:

▫️ #OpenAI must deploy infrastructure up to 6 GW of GPU capacity;
▫️ $AMD must hit both technical and commercial milestones;
▫️ one of the stages activates when $AMD reaches $600 per share.

In theory, it’s a perfect “win-win”: both sides are incentivized to make the partnership succeed.
In practice – it raises more questions than answers.

$NVDA, $AVGO, $MSFT, $GOOGL, $AMZN, $META, $ORCL, $NBIS, $CRWV, $EQIX, $CSCO MUTUAL INCENTIVE OR MUTUAL INFLATION?

$AMD is effectively paying OpenAI with its own shares to buy its chips.
OpenAI, in turn, benefits from AMD’s stock going up – because its future stake depends on it.
That creates a feedback loop where both sides are inflating each other.

Wedbush analysts called the deal a “1996 moment” – the start of a new IT era.
A more accurate label might be a “2000 moment” – when #Cisco financed its own clients through venture arms so they could buy $CSCO gear.
We all know how that ended.

PARALLELS WITH NVIDIA

The $AMD-OpenAI story looks even more worrying given what $NVDA is doing.
$NVDA announced plans to invest up to $100 billion in #OpenAI to deploy 10 GW of AI infrastructure – again, built on its own GPUs.

Ironically, OpenAI could use part of those funds to buy chips from $AMD.
Meanwhile, its business remains unprofitable and continues to burn cash.

What we’re seeing is a “circle of capital”:
$NVDA invests in OpenAI → OpenAI rents compute from $ORCL → $ORCL buys chips from $NVDA.
A perfect ecosystem – until you remember what happens to such systems when new money stops flowing.

Image by Lin @Speculator_io

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