20VC：AI泡沫破裂风险、信贷市场信号与Neoclouds生存法则

If there is a dislocation, no one is better prepared to survive it than hyperscalers. Let's take Neoclouds. I think at least half of them go away within 36 months. Jerry Murdoch joining me in the hot seat stage. He's the founder of Insight. They've managed over 90 billion. Jerry has seen pretty much every technology cycle of the last 25 years. He's invested in some of the biggest companies across those 25 years. And today we debunk whether we are in a bubble or not.

Whether China will beat the frontier models, whether we are about to have the greatest cyber security threats of our lifetime. This and so much more.

Fireworks is making a lot more money than base 10. The more you customize the model, the more the token changes its value.

Ready to go. Do you know what? I love my I think I genuinely have the best job in the world because I get to sit down with people like you and I'm dumb as rocks, but I get to ask questions that normally I wouldn't be able to ask and I get to learn from the greatest minds. So, thank you so much for joining me for a second time, Jerry.

I'm happy to be here. Now I want to touch first on something that you said to me before which was you said if the Iran war continues to fester then you expect to see a correction and depending on the depth of the correction the AI bubble will burst between October the 26th and March 27. Um can you help me understand your thinking here? If you look at what happened 2001, the end of the dotcoms, the innovations stopped for a while and then new innovations came in the LAMP stack which led led to rolled out of of websites.

Google started taking off. 2008 cloud computing very slow to take off and this is because there was you know this the financial disruptions slow things down. The stream of commerce gets disrupted and right now with AI debt is a huge part of this. It's so unique compared to previous cycles. So much debt all the hyperscalers have taken on much more debt than they ever have before. And the challenge becomes can will these guys get disrupted if the credit markets have a disruption which would be certainly what would happen if we had a problem in the overall capital markets.

The concern for you here is that we'll have a credit market disruption caused by the global conflict which will then impact the ability for these hyperscalers to borrow cheaply.

Well, that's one potential disruption. I see several that could occur. And I think if it's going to happen, it's going to happen if this Iran war, we can't have it just continue. And I the reason I say this right now is of complacency. We've got tremendous red lights that have been going on for a year or more on the credit markets. And there's just complacency. It's like, ah, we're fine. And I don't think people are accounting for risk.

I mean, if you think about it, um, those guys that are in the private debt market, the the spreads are too narrow between real risk and and and not so much risk, and they're not really accounting for that. And so, I'm concerned about that as one sector. But there's multiple because this AI revolution is incredibly complex with massive amounts of dollars being spent on it globally. What are the signs to you that we're seeing a cracking in the credit markets?

Well, complacency is the first thing you look at. When it happened in 2008, 2010, there was a handful of people, which there's always been documentaries about these guys that made money on shorting the housing market. Um, but everybody else in the world had no idea what was really happening. It was complacency complete, you know, and what you had was, you know, really ugly situation where the people that were supposed to be keeping an eye on things which were the credit rating agencies and the credit risk departments of the big banks were asleep at the wheel and this terrible thing happened and there was enforcing this risk. people didn't recognize because historically there had never been a huge default problem with mortgages and that was the kind of thinking that was there and they didn't realize that the underlying problems associated with credit.

I see the same thing today in that in the credit markets there's many opportunities for there to be problems. In the late 90s you had long-term credit blow up. We just had Liupole blow up because he wasn't accounting for, you know, uh the leverage that he put on his fund. Um I still see that there's these little warning signs that the complacency is is is is the biggest issue. Um in Japan, another problem, right? So this is the second time the US has bailed out the yen.

Um and why are they bailing out Japan? That's because Japan holds a trillion dollars in in treasuries. And if they have to unwind that, if they sell 100 billion worth of treasuries, the market could absorb it. But if they sold 300 billion worth of treasuries, a third in order to to be able to buy dollars to to support the yen, we would have a real problem on our hands immediately. Immediate global problem. So you you just see like I I do a lot of backcountry skiing and you recognize the avalanche conditions when they're worse or they're better and you recognize things can be just easily tipped over.

And so the war in Iran if it gets really ugly, which it hasn't yet if it if things collapse and inflation comes back, these are disruptors. all of multiple different opportunities for disruption all based on the war. Can I ask you though when we look at prior credit market cycles like you mentioned there was the challenge not the underlying assets were were of poor quality when we look at the hyperscalers today yes Facebook is having a bond issuance that's priced higher than expected but but Meta's core business is throwing off hundreds of billions of cash flow they don't need to borrow really they could do it off balance sheet it's an optimization game the assets are good

I think you just saw that the free cash flow is the lowest it's ever been in the history of a company. Number one. Number two, you know, back in the dotcom bubble, there was a lot of fiber that got laid in the ground and that fiber was always valuable, but the companies that laid the fi fiber and stuff, they all went bankrupt. So, you know, when you're really heavily dependent on debt and there's a dislocation, the underlying value of the asset declines.

It may not decline forever, but it declines pretty sharply in a very short period of time and that's when you have margin calls. That's the way it goes.

What should they do from here? They should not take out such levels of debt. Like how do you expect this to play out?

I mean look I mean what people are making decisions on the risk that they see to their business if there is a dislocation no one is better prepared to survive it than hyperscalers. I mean, all the hyperscalers have enough ongoing business and they've been very consistent. That's why they're worth what they're worth. The Magnificent 7 is there because they've been doing this for a long time. And so, they know that they could absorb this.

And if it happens, it'll be good for them because everybody else gets wiped out and then assets are become cheaper for them to acquire and they're in still in good shape. The demand for AI compute is not going to change. That's not going to go away. The issue is the ability to fund it in the short term. Let's take NeoClouds. Neoclouds right now, there's a whole bunch of them. I think at least half of them go away within 36 months, but that and if there's an an economic disruption, a lot of them go away right away.

Can you help me understand that? I I can't pass that over. What will separate the Neoclouds that go away and become valueless versus those that retain value and become even more valuable?

That same a question around which which head funds are going to go away and which ones aren't. If you looked at at at Leopold's returns, you think he's never going to go and he's probably go