Hacker News

I've been told the following (obviously negative) narrative. Can someone verify/refute some of these? I've put (?) next to questionable claims.

1. Twitter is purchased with debt

2. Debt is transferred to xAI via acquisition of X/Twitter

3. Debt is further transferred to SpaceX via acquisition of xAI

4. SpaceX IPO offered at extreme valuation

5. Index fund inclusion rules waived for SpaceX IPO: profitability requirement, inclusion period cut from 90 to 5 days

6. Index funds are largely held by passive investors such as pension funds.

7. Index fund managers are not incentivized to exclude a SpaceX from their indexes. (?)

8. Holders of original X/Twitter debt (banks) incentivized to support the rule waiver since post IPO, SpaceX will have liquidity to service/pay the debt.

9. Passive investors are unable to rapidly respond to these types of changes because liquidating portfolios will incur capital gains taxes. (?)

10. SpaceX is in Texas jurisdiction, where shareholder lawsuits are not possible and must instead go for arbitration. (?)

But the SPCX float is a small fraction of its overall shares. So it will end up being around 0.08% to 0.12% of the weight of the SP500 [1]. Nothing to write home about.

Personally, I do think SpaceX is overvalued at these proposed IPO numbers and I will trade accordingly. So should anyone else who is confident and competent at taking appropriate market positions.

1. https://www.investmentnews.com/practice-management/spacexs-i...

There are many valid complaints about public markets undervaluing businesses in comparison to private markets, now that everyone is putting their money on the line we start to see a different view being taken

which is exactly why public markets have always been a superior price discovery mechanism in comparison to private markets

Have you contacted your government representatives yet? I will be doing so. The federal government can probably stop this but we need to act now.

Okay before we set off the alarm though, can someone tell me What percentage of these index funds will be SPCX and TSLA?

Like if both these stocks become penny stocks what happens to the indices?

Isn’t the whole point that they are hedged across the whole market?

If Al Capone were alive today he'd seem like an honest man compared to these crooks that are running rackets on a global scale.

Should one sell their 401ks ahead of the forced buying

This should trigger all of us to be spinning up lawsuits. This whole thing is an absurd grift.

i read it as most likely people will lose their retirements if the companies goes bust. is that correct? in my country now they move to new pension model which will allow more aggressive investments with them. i am worried it will just get sent to these bros and i'll work until i die.

Why? An index fund represents the market (usually top 100 or 500 companies), and SpaceX will certainly be in the top few companies. I would argue it's a lot riskier to buy it after the IPO price (if you're buying it secondary it would be easier to spike prices by accident), plus then it's not representative of the actual market until you've purchased the stock.

Unless I'm misunderstanding this, buying at the sale price is the least risky way of purchasing the stock, which is what index funds should do. They should pursue the least risky way of indexing the market

>This should be a 5 alarm fire.

Only for people that get their news from reddit.

Initial public offerings whose market capitalizations rank within the Nasdaq 100’s top members will normally be eligible to be included after 15 days of trading, Nasdaq said in a statement. The timeline is shortened from at least three months currently.

“Industry professionals, including asset managers and institutional passive portfolio managers, were mostly supportive of the Fast Entry proposal and proposed timing,” Nasdaq said in the statement.[0]

15 days vs 90 days isn't some huge shift nor is it inherently some "flaw." These changes have been asked for long before Elon entered the White House.

[0] https://www.bloomberg.com/news/articles/2026-03-30/nasdaq-cl...

which, if true, would make an arbitrage opportunity for a fund that explicitly excludes these high valuation targets but buys those trimmed companies (because for trimming to have happened, they must've been sold unwillingly and thus must be under-priced).

>The money still comes from somewhere.

Can't they just be printed and massive funds borrowing money to buy shares?

Do you think it’s more or less likely that they will make the same change as the other benchmarks?

Are you actually optimistic?

If it does not matter, then don't change it.

> it doesn't really matter because the float will be tiny due to the 6 month lockup.

Not really: https://www.reuters.com/legal/government/spacex-allow-early-...

The indexes are weighted based on the float (at least most of them)... so a small float means they will buy a much smaller number of shares.

How about 1 more quarter of earning reports and estimates?

SpaceX is slowly and steadily increasing the float over the first 6 months by having a rolling end to the lockup. The only major cliff will be Elons shares

There is a world of difference between 5 and 90 days, even if you aggressively stick to the “time in the market over timing the market” strategy. If it wasn’t of consequence, then they wouldn’t be attempting to change the rules. And if SpaceX is such a great long-term investment, then they shouldn’t need the advantages this provide. Join the index funds like any other company. Let the market sort itself out.

You protect yourself by understanding that this is one infinitesimally small cost (expressed as a fraction of your portfolio returns) that doesn't overcome the benefits of maximum diversification and the ultra-low fees of broad-based ETFs.

Buy MSCI World, enjoy the 0.04% p.a. fees and minimal idiosyncratic risk, and relax.

Index rebalance traders will reduce your annual returns by less (probably much less) than 0.1%, but there is no better alternative for you at this moment in time.

Here are some options for pre-tax retirement funds (ex. 401k):

1. Exchange your market-cap funds for S&P 500. Afaict, even with their own rules changing, they will wait up to 6 months (as opposed to 12) to let SpaceX in. This is the simplest solution that buys you time without losing other gains in the market, assuming your existing funds were broad market-cap funds. The idea here is to wait for ~5 months and see if you still want/need to exit S&P before they let SpaceX in, or pick another option.

2. Exchange your market-cap funds for RSP, an equal-weight fund. This is also simple and reduces your risk, as SpaceX's allocation of the fund would only be 0.2%.

3. Exchange your market-cap funds for a selection of different funds in order to replicate the previous allocation. Buy small-cap and mid-cap funds, and buy ETFs that cover the market without including tech. This is more complicated, but not really that complicated once you learn how to exchange funds. Still mostly passive, you're just actively managing your allocation into different indexes. Downside is you lose the gains from tech.

4. Exchange all your index funds - temporarily - for a money market fund or other low-risk, low-return investment vehicle, until SpaceX price settles down. This is the absolute simplest option, least risk, least reward. You lose all the gains from the market during this time, but a percentage of your fund doesn't disappear overnight. If you're nervous, it's safe to do this by June 11th and sit on it until July 5th and see what you'd like to do then.

You probably DO NOT want to do this for non-retirement funds, as you will get hit with capital gains taxes. You would have to estimate how much you think your portfolio would drop due to SpaceX's overinflated price falling, and compare that to your potential tax bill from rebalancing. It's almost certain that your tax hit would be higher.

I asked this the other day. The response was to buy VGT instead of QQQ https://news.ycombinator.com/item?id=48324097#48334357

You could move your passive investment to an index that includes a great proportion of bonds or move to an entirely bond based index. You reduce the upside potential and downside potential.

I personally have moved my retirement accounts to bonds while being more aggressive with my personal investments.

Not buy these index funds. If you don’t want to own the entire market, don’t buy funds that seek to own the entire market. Funds like ESGV which exclude companies with poor governance have existed for a very long time - I can’t find a clear answer as to whether or not it will buy SpaceX, but I’m sure you can find funds that cater to your desires.

If you intend to remain a passive investor, keep doing what you’re doing. If you have conviction that AI boom will bust and you want to become an active investor, follow the advice from other comments on how to prevent these companies from being part of your portfolio. If you're going to become an active trader, I suggest thinking about both upside and downside risks and look beyond the local echo chamber.

Become active investors.

There are many large cap ETFs out there:

https://etfdb.com/etfs/size/large-cap/

You could switch to one that focuses on stocks which pay dividends, for example. That should provide a bit of protection against an AI market crash:

https://etfdb.com/etf/VIG/#etf-ticker-profile

So-called "smart beta" ETFs are also interesting. https://etfdb.com/themes/smart-beta-etfs/

Here are some factors I would expect to rule out the frothiest stocks:

"Quality Factor ETFs are made up of securities deemed to exhibit strong fundamental characteristics. These ETFs screen for stocks that have healthy balance sheets, encouraging growth prospects, and consistent improvements in their earnings."

https://etfdb.com/themes/quality-factor-etfs/

"Value-centric ETFs invest in securities deemed to possess value characteristics, including those operating in stable industries with relatively low price-to-earnings ratios."

https://etfdb.com/etfs/style/value/

"Low Volatility ETFs invest in securities with low volatility characteristics. These funds tend to have relatively stable share prices, and higher than average yields."

https://etfdb.com/etfs/investment-style/low-volatility/

Be sure to check the expense ratios on smart beta ETFs. Generally, the more sophisticated the stock screening, the more they will charge you in management fees.

As long as you're thinking about your portfolio, you may wish to consider international diversification in case the US economy implodes somehow: https://etfdb.com/themes/international-equity-etfs/

Personally, I keep my portfolio extremely conservative. My bet is that if the singularity arrives, we will all either die, or get UBI. I don't particularly care about having more moons than the other guy: https://www.astralcodexten.com/p/you-have-only-x-years-to-es...

Move your investments to funds that won’t automatically buy spacex stocks

This disregards the fundamental reason why people buy index funds in the first place. Rules for consistent GAAP profitability and cooldown periods specifically prevent retail investors from being exposed to particular malicious stock market tactics and overall risks that otherwise could significantly hurt them in the short term. So it's more like saying "you don't like extra risk? too bad."

This is simply not true and a misrepresentation of the issue. There is no issue with SP500 buying into all these companies. The issue is that “valuation” should be determined by the market before the index funds buy into it hence the original rules and policy in place. Else wise we run into the issue now where our 401K is pumping the IPO, regardless of fundamentals.

> The fundamental reason S&P 500 exists is to let people buy the entire market

And why do people want to buy the entire market in the first place? They want to diversify and insulate themselves from a single company crashing their portfolio value.

What are people afraid of right now? They're afraid of a single company crashing their portfolio value.

Why are people afraid of their portfolio value crashing? Because these 3 companies will fundamentally increase the overall risk and volatility of the index.

Do you see the problem?

Why the special rules for SpaceX though? I still do not understand why the world’s richest man and one of the most valuable companies needs an exemption? Genuinely confused.

Why would you accept this? Who does this serve?

I want to believe the world is full of good people but I read stuff like this and realize otherwise.

This needs to be higher for more visibility, because the weighting and the float's proportions are an important aspect that most news sources or comments fail to mention.

Correct me if I'm wrong, but 0.1% of S&P 500 seems exceedingly huge when you consider how much of the economy is represented in the S&P 500.

>The NASDAQ 100 is an exception, and has changed its rules to weight companies at up to three times their free float, in an apparent effort to woo Mr Musk.

im not a finance guy, can someone explain to me why the nasdaq would want to "woo" someone specifically? what benefit would nasdaq get? or, alternatively, what harm would befall nasdaq for not woo-ing musk?

This really makes it clear. Thank you!

how dare you come in with rationality in the face of ELON BAD

That’s the new paradigm of US leadership. Not laws or principles but just „who’s going to stop me“

And if it's not fraud, it's fascism

Also worth asking what SpaceXLAI's plan is to make money. $22.7T of their $28.5T Total Addressable Market is... Drumroll... Enterprise AI! That's the plan, that's what we are investing in: spacex and Tesla and Twitter are all side shows, to sell AI. That's what everyone's absurdly overpriced forced passive investment is going to. https://bsky.app/profile/segyges.bsky.social/post/3mnan7hr2j...

There is nowhere near enough burning rage for this absurd fleecing of the public.

Yes that's definitely possible and will probably happen. The big hurdle is traction though. How many people will know about it and be willing/able to shift into it? A lot of passive investments are effectively locked in by unrealized gains or limited 401k provider options.

*trillion

The 12 largest companies in the USA together have that market cap, so probably not.

> Do you have a source for the $30 million claim?

Index funds in total had about5 $7 trillion in 2021 [1].

[1] https://alexchinco.com/double-what-you-think-it-is.pdf

This kind of doesn't make sense. You don't park "money" "in" crypto. Crypto sits there, with its value set at the last sale price. There's nothing to stop the next sale price taking its value to zero without anything happening to real money other than some of it changing hands. It's not like crypto holders can sell $2.5T of crypto and plough it into equities, for a start some other investor will have to buy it from them for $2.5T and then we're in the same position we started in.

The S&P Shariah index fund is required to exclude SpaceX and already exists https://www.spglobal.com/spdji/en/indices/equity/sp-500-shar...

Wouldn't the other index stocks need to tank as funds must be shifted by large scale investors into the these new gigalistings?

Only $3mm needed?

It's honestly blown out of proportion. S&P 500 allocation is float adjusted, i.e. the allocation is based on the market cap of the floated shares, not the total market cap. SpaceX float is ~4% at IPO, and at a $1.75T valuation that's $70B in floated shares.

SpaceX will be ~0.125% of the index. The actual amount of buying is in the low tens of billions, and given these are $30 trillion+ markets, this is hardly anything to fret about.

Oh, SpaceX already has that covered: thanks to the TX legislature, SpaceX shareholders cannot file shareholder lawsuits, you can only complain to the "Texas Business Court" or get binding arbitration [0].

[0]: https://www.bloomberg.com/opinion/newsletters/2026-05-21/spa...

why? the cards are on the table. If you buy a turd from me after I disclose the composition, that is on you

Listen to the author of “A Brief History of Financial Bubbles” argue why it probably isn’t a bubble:

https://api.substack.com/feed/podcast/260347/s/233172.rss

https://podcasts.apple.com/us/podcast/conversations-with-col...

https://open.spotify.com/show/0Cj2lIpGxkrw1RFVIPTa6a?si=f41c...

We don't let bubbles pop anymore. We print money and borrow from the future so that no one loses money on their homes and retirement accounts. The GFC changed the rules.

It’s never going to happen because too many people want it to happen.

oh yea good way to stay out of market and retire like a poor person.

> If this is a bubble... The pop stage will be devastating...

Why? It could be sudden. It could be slow and gradual. I've seen no reason it needs to be one versus the other.

One thing I have come to realize, is that worrying about bubbles will keep you poor.

If everyone is in the bubble and it pops, everyone is in the same boat, so you’re not really going to be poorer than your peers by comparison.

If it’s not a bubble and you are wrong, you will fall way behind everyone else and just watch people get richer and richer doing the exact same thing you should have done.

Also, just because something is a bubble doesn’t mean it has to end in a devastating pop. Sometimes bubbles expand and then just get diffused. The exponential rise stops and prices plateau, but it just becomes a new normal and things stagnate for a while before resuming normal upward growth.

We need the opposition taking names for investigations in 2029. They're not all getting pardons.

> this is disgusting corruption

The guy called 401(k)s a Ponzi scheme. Now, he's coming after them to loot.

> S&P 500’s 12-month seasoning and 4-quarter GAAP profitability requirement → waived

S&P hasn’t announced a final rule change yet.

People buying into space x are basically telling Musk to do anything he wants with their money, no questions asked...

And CRSP (VTI)

They should have to float on the market for a certain amount of time before being added to any index. This would reveal what the market value of the stocks actually is.

"Why don't you just say that this store is selling pants that smell of poop, it's irrelevant that someone pooped in them because they also sell other pants that no one pooped in. Aren't you upset that they also sell you pants without poop in them?"

I have yet to see an application outside of harnesses and LLMs itself where adaptation has happened on a larger scale. Devs are fine with babysitting their LLMs. People like to use LLMs to improve their mails and so on. But outside of that, the adaptation is not there yet.

Don't get me wrong. I love LLMs and use them myself. But the biggest gain for me is easier context switch and text manipulation. It's not the: replace X with a bunch of LLMs every CEO is dreaming of. So yes, you have higher productivity, but is the eval of those companies legit? x doubt.

Isn't AI routinely making significant mistakes in analyzing medical imaging?

> In terms of AI, we've seen even here on HN everything from mathematical problems that remaind unsolved, being solved, mathematical proofs being used to disprove theories, heck we even learned more about alzheimers

What a story this is

People want to buy SpaceX, not Twitter, Tesla, xAI. Unfortunately Elon has been conflating the three.

You'll overpay -- but not by trillions.

> they've produced the cheapest way

Were we struggling to do this before? Was the overall percentage reduction in costs? Was some other achievement held back because we couldn't accomplish this? What is now enabled?

> to get any payload into space.

A limited set of payloads into space. No vehicle can get "any payload" to space at a fixed price.

> The benefits are easy to miss,

You've listed a bunch of reasons to publish papers. What is the actual ground level change that's occurred? Are those antibiotics produced? Do they actually work just as predicted? Why is that first world problems are exclusively listed but basic problems like world hunger are never even approached?

> or wouldn't have within our lifetimes.

And your life, your actual life, benefits, how?

Sorry but SpaceX has done absulutely nothing for space other than take billions in GOV funding and never delivering what they promised years ago. Hell the only cargo they ever shipped was a banana...

I suppose many do live in different worlds.

I haven't found anything out of LLM's that has improved my life. It was a fun little toy but could never find a use case. But clearly, your mileage varies greatly from mine. That's cool.

I just personally don't the use in more when what I think many need is less. But that comes from essentially this point of view - “Better than a thousand hollow words is one word that brings peace.” ― Buddha

I use LLMs daily, both as chat applications and "vibe coding".

I wouldn't say it "significantly improved my life" however. Everything AI has done for me right now is a "Nice to have" but it doesn't fulfill my needs.

It’s because people value different things. I could not care less if LLMs make me push code faster to prod. Couldn’t care less if they improve my emails grammar. Couldn’t care less if they crack one unsolved math problem.

I do too, and pay $200/month, but anthropic’s margins on that revenue are negative.

What’s the long term plan? Make it up on margin? 100% tariffs on Chinese open weight models?

I don’t plan on pulling from my 401k for decades, so the long term plan is the part I care about.

I’d love it if for once someone on here saying LLMs are some life changing apparatus would give a single example.

I think it is a typical example of where N% (N tends to zero) of the population GREATLY benefits AI models, while the next bracket (casual users) enjoy some benefit, but the vast majority would not feel any difference if they lost the tech tomorrow.

Let me rephrase that to you: The vast, vast majority of people, even in the western world, even the white-collar part of the population, are not whales or power users of AI models.

I use ChatGPT daily. And I never spend more than $25/month. If I lost it, it would suck, but it would not affect my life significantly. I then see people spending $100 / day on Claude Code tokens, programmers in startups / tech companies rack up thousands a month in bills. These people are literally spending 100x more than me, a casual user.

Yeah, I suspect they follow some sort of whale economics - where a relatively small userbase (in the big picture) and providing them with a huge chunk of their revenue.

But still these companies are being valued as if they're some omnipresent companies which humanity simply can't live without.

Do you use Grok multiple times per day? Is Grok solving Erdos problems?

Comments like these make me feel like AI is a computer in the hands of a monkey, and that too the computer which is unreliable.

I don't know if its really improved my life at all. Sure I can put together quick and dirty single-use programs faster I guess, but I feel like losing that practice has actively made me a worse developer.

Even if they are, it still doesn't justify the ridiculous levels of overvaluation. They are not essentials and their consumer demand is extremely elastic.

So, let's see. LLMs made my overall coding output significantly faster, even factoring in review time and tech debt. My employer should technically benefit from this, but it doesn't really, because all its competitors use the same AIs and all their engineers increased their throughput in a similar way. So I'm not sure that I, my colleagues or the whole segment I work in really benefited from AI in any measurable way.

Another generic, useless comment which absolutely refuses to mention any particular aspect, eg how your life has been improved. It's so tiring

And when pushed all we get is another teaser of "Significantly increased my productivity"

Id be more enthusiastic if I could buy starlink at a valuation based on starlink. Instead we’re getting a shitsandwich of a combo stock with a pile of regulatory manipulation on top

Yes, the help Ukraine... by not connecting Crimea by choice.

They are fundamentally different, but people desire they be aligned. The public expects the economy to producing higher quality of life for us, otherwise what is it doing? And for whom? But whether it actually does so is a function of other things. That gap seems bigger than usual right now with AI and tech eating the whole economy.

One would assume that the "market cap" of the company is equivalent to it's *worth*. Asking how Anthropic is worth $1tn+ is a valid question when it doesn't do much, apart from the promise of making a large fraction of the world unemployed and the rest under the thumb of unethical American tech supremacy. It's arguably built on the largest intellectual property theft in the history of mankind. That's generally what people worry about. Whether that's "true" or not I guess is how you frame your world view.

It's not a pyramid scheme, it's a reverse funnel.

If jury is still out on positivity, long term, of AI, I'd really like to see arguments for that. Historically all - almost? - technical improvements were net positive; even some blunders had upside. AI is dangerous, yes, but e.g. fission was developed for the bomb, and now powers significant numbers of households worldwide - the tech less than 90 years old.

> Basic necessities are expensive

There is going to be a well-deserved shitshow when these IPO proceeds start hitting real estate markets.

If everyone using Gmail permanently lost access to their gmail there’d be massive problems

you can replace “google” with every company that exists or has ever existed so no sure what the purpose of your comment is unless you are pitching abolishing the stock market. google is what they are because they make shitton of money and will continue to do so (more and more) into foreseeable future. that is stock market, always has been, always will be

Meanwhile the federal minimum wage is still $7.25/hr.

This is it entirely. I don't really care if the pessimists or optimists or somewhere in between ends up being correct. What possible reason is there to change the rules around the indexes unless these companies and their backers know that time in the market is going to expose that they're overvalued and they want to force someone else to be holding the bag when that happens.

> There are a lot of retirements on the line just by this fact

1) I would expect anyone close to retirement to have a fairly balanced portfolio.

2) if they don't include SpaceX and the stock does >10x in the next year, they'll end up doing terribly on the benchmarks. SpaceX is big, but if they invest early, it won't be a ridiculous % of the portfolio. Even if one overpays by 2x, since it's under .1% of the total portfolio. If it went to zero nobody would lose their shirts, they'd lose <.1% of their portfolio.

I also think its hard to know when it will pop. The Chinese real state bubble you are quoting is indeed a very good example. Everyone knew the prices were super high but no one really knew when it would blow. The state had a problem and they knew they had to stop it eventually. After/during the covid pandemic the state decided to start a slogan "houses are for living not for speculating" and they started to set redlines for leveraging and developing. If you know how financing works in china you know many of it flows through the state and related companies and financial structures. Then also when one of the biggest developers in the country blew up they left it to blow instead of buying it. They essentially popped it with policy.

So many would say the saw it coming but the truth is only people with inside info really knew when it would happen for sure.

Same happens today. Capital is being heavily allocated towards AI inference and infra because of the promised productivity. Nobody knows if its early or late and also nobody knows how will the state react to a possible bubble exploding. Some people would say maybe AI is too big to fall already and its better if we save it when it falls. Some people would say its better to let it blow up but again nobody knows what will truly happen until we get there.

Bubbles are extremely predictable. The problem is predicting when it will come crashing down.

Huge data centers and energy infrastructure projects mean lots of potential for local businesses to benefit, employment opportunities, etc. These companies are raising an unprecedented amount of funding and are looking for places to spend it.

With the right policy and legislation, this level of investment should be welcomed rather than opposed in most sensibly run places.

For example California and Germany have a lot in common when it comes to the locals blocking all forms of large scale infrastructure for mostly selfish reasons. Both places have broken energy infrastructure, high energy prices, high taxes, very bad roads, etc. Both have decades of backlog in terms of outdated infrastructure in need of major upgrading/fixing. Everybody is wringing their hands about fixing these issues because there is no money and tax pressure is already too high.

And here are some of the wealthiest companies in the world looking for places to spend their many billions. Surely, that's something that could be mutually beneficial. All states need to do is set some sensible terms and conditions for this. But instead you get people campaigning against this. I really don't get that negativity.

If you are growing revenue at a high rate then taking profit is a misallocation of resources. That is short-term thinking. It is much better to reinvest in revenue growth.

You can take small profit now or much larger profit later. Insisting that companies need to be profitable even when growing revenue rapidly is failing the marshmallow test.

Please don't ask those rational questions, revenue is all that maters.

While good to ask, that is less relevant so long as they can maintain runway.

Doesn't inference have very good profit margins* but all the losses come from training?

* For now, when they don't have to compete much against companies like DeepSeek who supplies inference at 1/10th of the cost

They reported 559 million in Q2 of this year. OpenAI on the other hand, is nowhere near this.

I suspect the answer is: in the future after Moore's law somehow inevitably does its thing.

That has worked in the past for tech infrastructure, so there is clearly a gamble that it does that again here.

These AI companies will be able to jack prices way way up once companies and users are fully addicted to doing everything with their AI.

Anthropic seems to have clawed its way to being the best AI and charging for itself. Microsoft had to slash the Anthropic budget… which it exceeded while being the exclusive host of OpenAI.

Google seems to have a good B2B and internal leveraging AI to make $. OpenAI/Microsoft seems to have squandered an early product lead.

And then you have the Muskiverse, where we have an rocket ship company that buys surplus cyber trucks, operates a space ISP, an AI company that produces virtual fetish porn and makes money renting GPUs to Anthropic, a rando dying social network and a tunnel company to cock-block public transit.

I may be underestimating the market for AI anime porn, but I think Anthropic is probably the best in class product right now. Google and AWS are probably the best positioned sellers of AI. SpaceXAI is the dark horse because they are likely enriching the dear leader more. OpenAI is fucked.

Anthropic is profitable unlike OpenAI though. Sure they'll owe a lot of money for probably decades, but if they remain profitable moving forward, it will be worthwhile.

I think their real moat is the grip they have in corporates.

Once they are in, they will catch most of the opportunities.

They will defend it the way any good monopoly always does: buying the competition. Case in point is Facebook: it is just a social network, the way they really stay on top is buying other companies and paying for people to spend even more time on their properties.

I can’t imagine them actually being bullish about exponential growth, when both seem instead to be stagnating. I’m more inclined to believe they’re just maintaining a level of hype in public because that’s what you do.

The AI market might not collapse but the stock market could! Even if the AI companies only need to downgrade their investments and a healthy correction is underway, a fire sale of AI-related stocks will bring the stock market to its knees.

What are they offering the public (not me and you writing code in our free time)?

where the heck are you seeing OpenAI racing to IPO before anthropic?

> the accelerated S&P 500 inclusion of SpaceX

To be clear, S&P hasn't announced a decision on this yet.

The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO.

Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.

The old saying goes, the market can remain irrational longer than you can remain solvent.

I’m not necessarily expecting a crash any time soon. (But we average a major correction, what? every 8 years? So if you keep predicting one long enough you will eventually have been right all along.) But I do feel comfortable saying OpenAI and Anthropic are overpriced. For more or less the same reason Cisco was overpriced in the late ‘90s. It’s not that what they were making wasn’t valuable; it’s that we got out over our skis a bit over how much of it the world could actually manage to consume in the immediate future.

> After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.

Groupon got to pretty much 100% penetration, still crashed and burned right after IPO. I think Zynga followed a similar trajectory.

Read history: people always think everything is fine ... until it isn't.

The headwinds are way worse now, though. Oil is choked, war is brewing, and corruption is at an all-time high.

US markets will keep superpositiong S-curves upon S-curves upon S-curves. Just as Elon Musk does with his companies. Just ask Tesla/SpaceX bulls.

If note the dotcom boom lasted from about 1995 until 2000. Housing bubble longer. Theres no time table on when the bubble bursts, and the web didn’t die and neither did housing when the burst happened. It is just a reset and consolidation of overtly excessive speculation. It’s not like the bust leads to an end of civilization.

> People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023.

The bubble can't pop until after an IPO, and that doesn't mean "immediately after".

You can't have a run on a privately held company.

In 2004 people were predicting that the real estate bubble would burst and then nothing happened. Until it did.

> 30% increase in one year

30% above the average. Households bought $1.6 trillion in Q3 of 2025, for example. (Foreigners bought a further $650 and $700 billion in Q3 and Q4, respectively.)

American capital markets are ridiculously deep.

> A third of all spending is not fundamentally a stretch?

Where did you get spending? That's net buying of stocks by non-financial Americans. It's the new money that has, on average, gone into the U.S. stock market from that section of investors every year. A third of it going into these new issuances doesn't need to break anything.

> it treats Social Security and Medicare/aid as a liability instead of the service that they are

It's a liability because the U.S. has promised to pay it. We haven't committed to a level of military spending backed by our full faith and credit.

EDIT: Never mind! Apparently we can just cut social security payments.

39T is just the outstanding value of all the Treasury instruments (T-bills, etc). The entitlement programs (SSA and Medicare) have made commitments to certain levels of service and payments that are far in excess of the revenues they bring in, that's what is meant by "unfunded liabilities".

How can you use a word like “never” when this debt is literally unprecedented in the history of the world

Well, will be interesting to see how this play out. The US federal debt repayments is already above $1trillion a year.

Repayment isn't a goal that anyone in the system should reasonably want. Federal debt is not like credit card debt. Debt is a product that the US Government sells. Me, being a big corporation or human, go to the USG and say "I need somewhere to park my money that is safeish from inflation". The USG sells me debt at X.Y% interest. The money now generates safe interest, which means its safeish from inflation. A world where the USG "repays the debt" is a world where this essential product is no longer available.

High levels of debt only signals high demand for this product.

This is super-counterintuitive, but the debt has little to do with the deficit. We could run a surplus and still be in the same level of debt (in fact, this would be a tremendous place to be). We could run a deficit and have no debt (just print money, duh). The decisions that go into column A generally do not impact the decisions our leaders have to make in column B, though there are of course convenient relationships between the two.

As mentioned defaults do shockingly little to change future funding. Its been years since i looked but its something like a few years of “cool down” on issuance and a few points of coupon premium. The economist has done some great, very accessible, articles on this over the years.

Second, its critical that treasury bonds are denominated in USD. The us gov controls the monetary policy and can choose to inflate away the debt over time. This is in contrast to EM debt where they get trapped with foreign denominated bonds. See also the tensions around EU debt, greece, etc.

> Of course they're not going to find a market to sell more debt to after that

Argentina is doing fine. The real constraint would be that defaulting on the debt would cause a credit crisis and bank collapses.

Not true

The powerful people holding the debt will seek to change the government to one that obeys them

The way I understand my money market settlement account at vanguard, is that it's all, or nearly all, treasuries. Treasury not honoring government debt would be the worst bank failure in the history of the world.

We also don’t have anywhere near $175 trillion in debt. That’s a crazy made up number.

The vast majority of that was fuel.

From that doc, prices went up 0.6% in one month, multiple by 12 get 7.2% annual inflation rate.

Inflation is a measure of the cost of living. It's not got loads to do with large-scale, institutional investments.

This is one of those "everyone who dies, breaths air" statements.

It's frustrating people who parrot it think they're smart by saying it to others with no basis and finally when it does happen they're like SEE SEE!?

> Until then, history teaches that we'll just keep going up and up

And this is the more important part. As long as you're <40 you SHOULD always buy SPY or VOO, even at the very top.

People have been saying the crash has been coming since 2022. If you believed this and acted on it, you would've missed 3-4 +10%/yr returns.

As Buffet says: You can't time the market; be in it.

I very much disagree that it's coming. I think we need to completely reset our expectations of how the market works. There's been nearly an entire generation working in this "new" bull market, where things like EPS mean absolutely nothing and speculation no longer requires actual returns.

> the crash (that we all know is coming) will do that. Until then, history teaches that we'll just keep going up and up

Stock prices don't have to crash. They can just stagnate while profits catch up and multiples compress.

Debt binges, on the other hand, tend to go bust with a bang. But after the recent private-credit scare, the AI build-out has been predominantly financed with stock. (I think.)

Several issues:

1) The short lifespan is intentional. There is no reason to keep satellites beyond a few years because older satellites are quickly becoming obsolete. The first generation Starlink sats are now 4 generations old, and are practically ancient at this point. SpaceX wants the satellites to fall, so they can be replaced by updated ones.

2) SpaceX could easily increase the lifespan of Starlink satellites to 10-15+ years, but they don't want to, because of (1), and because they are waiting for Starship to launch larger satellites at 10x lower cost.

3) Despite continually replacing satellites every ~5 years, Starlink is operating at a very profitable 40%+ profit margin.

4) Starlink is expanding to direct-to-cell 5G at speeds up to 150Mbps, which vastly expands the TAM from just broadband usage to all cellular data usage. Rural areas may never get a terrestrial cellular buildout, since it will be cheaper for companies to partner with SpaceX for coverage than to build their own towers. A cellular tower can cost upwards of >$250k.

It’s often telling what sort of thing is deserving of moderation. The timing is well documented as being extremely favorable to Musk and Altman and indeed directly benefits them. Suspicion is not only warranted it should be demanded.

At this point in US regulatory oversight I would have a harder time finding evidence of no corruption.

Why else would they change the rule ?

I think deep cynicism is the correct mindset to have in the current financial/political climate.

I find it to be genuinely more likely some level of corruption, and while my insinuation may be overly specific or illustrative, I still hold to it as an ironic statement meant to speak the truth.

In this age of AI marketing taking over the minds and imaginations of most of our businesses leaders in the name of greed and fear, I’ll hold to the more likely truth given the circumstances, regardless of this appeal to some invented tale of uncorruptable corporate governance. Have you never seen decisions being made?

I think that better matches the original spirit of this forum. The progenitors have become the people they once disrupted.

I was a lawyer in 2008 representing banks in the financial crisis. Multiple bankers wives set up companies to by mortgage backed securities using government loans and government guarantees on payment upon default. That let the banks get the toxic mortgages off their balance sheet.

These wives were yoga teachers and socialites. And I say that as a man that is a feminist and upmost respect for the amazing women I have worked with that were absolutely world renowned professionals. The bankers wives were not in that category and were shells to eliminate the “conflict of interest”. The CEO of Goldman Sachs did this. You can find the records if you want to be on a government watch list.

We’ve really hit that point, where our institutions are transparently corrupt, and everyone knows it, and both the guilty and the public just say “yep, we’re doing the corrupt thing”.

It’s depressing as hell, and it’s going to go out with the proverbial whimper, but at least we’ve got to be close to rock bottom, right?

To be fair, these are not regulators, just private companies making up rules, so technically this is not corruption just something that looks like it but it's just business™

These are all private companies's decisions.

> You're claiming without evidence that the bureaucracy and regulators are corrupt to the core?

The "bureaucracy and regulators" are at most engaged in passive corruption.

For passive corruption to exist, you need massive active corruption effort.

Why is everyone focusing on vilifying passive corruption while completely ignoring active corruption? I mean, I'm hearing lots of conspiratorial remarks directed at regulators but... Who stood to benefit? Aren't those responsible?

I mean, why was regulation required to begin with?

A third is a lot 16% is a lot

Sure, but it's the Americans that can least afford to be stood up as exit liquidity that have the most exposure here relative to their net worth. The ultra wealthy are going to be heavily overrepresented in the active basket. Meanwhile the folks lower down on the income scale are more likely to have their money in passive funds.

This is completely wrong. Passive funds don't buy at IPO price. They buy after the inclusion rebalance which happens weeks later, at whatever price the market has already set. Plus the S&P500 rule change hasn't even happened yet, it's unclear if the rules in the current form will go through.

Would have been interested in SpaceX but I don't like that xAI is being baked in so I will skip this one.

> The satellite business operates at a loss

How come? On the books or they're actually selling internet cheaper than they source it?

> xAI is a money burning furnace

So far in the AI business, it looks like only Anthropic might be profitable in the near future. On the other hand, a lot of nonprofitable companies have IPOd for billions with the hopes that one day they will become profitable.

Paragraphs are your friend

John Rockenfeller was an active supporter of black rights.

No california. Sounds like Australia

i feel like starlink could be huge, why not the default internet connection for everybody. similar to how people abandoned landlines for cell phones.

Technically, the model is a depreciating asset too. Just consider the difference between a model you need a B200 cluster to run vs one you can run on a Raspberry Pi. One's going to have a moat around it that gives it value and the other isn't. It's a hyperbolic argument to be sure but the nature of "enthusiast" hardware is that we're currently running, say, ~27B parameter models on hardware for a few thousand. What's that going to look like in 2 years?

Anthropic/OpenAI really need to train ever-bigger models to keep their moat. But that assumes there isn't a law of diminishing returns and also that a compressed model isn't sufficient for what many people need.

You mihgt say that the training is a barrier. And it is, kind of. Notice how it's Chinese companies coming out with open-source models like DeepSeek and Qwen? That's no accident. As soon as DeepSeek came out I knew what was going on: China is going to make sure no single Western company "owns" AI. It's in their national interest for that not to happen.

I wouldn't be surprised if the rush-to-IPO is motivated, at least in part, by getting ahead of Chinese AI commoditization.

How many failed foundation model training run cycles do you think these companies can tank before the bubble pops and deepseek/etc. catch up to frontier quality?

If Ant, OAI, etc. aren't able to make 20-30% improvements on Opus 4.6 in 2026, does the music stop playing altogether? It seems like they'd lose their ability to charge >10% gross margin on inference in a span of 3-6 months.

> I mean there's already a lot of hardware that has gotten more expensive in the last 5 years.

The vast majority of the price rise is mainly due to AI companies sucking all the air out of the room and everyone investing in "AI" regardless.

If China gets their process down to match US/Korea/Taiwan and they decide to flood the market to drown out competitors then hardware is going to be an order of magnitude (or two) cheaper than it is today.

It’s not a random comment, it’s a comment from Hackernews which is filled with smart people who are tapped deep into these industries.

  World Online IPO

Meanwhile, Anthropic is adding ~$10-$15b ARR every month.

  That said, I don't even see "huge demand" for the AI triocorns right now. Unlike in 2000, most people are skeptical.

Amazing! Thank you!

Investors can bank a profit at what they regard as the peak of the hype