The "spending money on each other" part is untrue. It is mostly going in one direction, towards Nvidia, and that's the reason they crossed $5 Trillion in market cap recently.
- Google (a.k.a. Alphabet): $35B
- Microsoft: $27.7B
- Apple: $27.5B
- Nvidia: $26.4B
- Amazon: $21.5B
Feels like Nvidia has too much money and they know whatever they invest in will appreciate thanks to the “AI premium” that investors bestow.
I've been patiently waiting for their resurgence. Building embedded/mobile devices is their forte, which is also coincidentally the hardware space where AI is most poised to shine. Nvidia made a move in the same direction when they tried to acquire ARM. That got antitrusted (fairly so) but investing in a now-decimated telecom company isn't likely to ruffle any feathers this way.
Wouldn't most of those people have gone elsewhere by now? If you're a mobile device superstar, why would you stick around at Nokia once the mobile device part of it crashed and burned?
A company's just a legal structure, people change over time. And that was more than 10 years ago, and didn't they sell their mobile division to Microsoft?
https://nvidianews.nvidia.com/news/nvidia-nokia-ai-telecommu...
Nvidia quietly in the background is getting more interested in the network side of things and are hiring accordingly. This is an area I don’t really think you have all the details to have an opinion on imo.
It feels like economics in the US is turning into FanDuel mobile gambling. Can we pass a law to disincentivize this garbage and make them start paying dividends again?
Feels gamble-y when the shovel maker is playing weird VC for the gold prospectors like this, but I get the appeal since Nvidia stands to lose everything if this stuff tanks anyhow and it further entrenches Nvidia's own position all while keeping the hype train steaming by moving units.
You can fund your education with part of your future job earnings.
In a perfect world companies should just do their business and nothing else. Companies shouldn't be able to own other companies because that's gambling on their value. They shouldn't be allowed to do stock buybacks because that's gambling on their own value (and a kind of insider trading).
In our world however companies are free to gamble on the side as long as their owners don't mind.
Whether what Nvidia does is the best or the worst idea, only time will tell.
Heres the thing, these assets deprecate, while the stock doesn't. I see a big asymmetry in deals like this, and I do not like it. When you start a business and become indispensable to your customers, you're doing well. If a company fails, it is maybe unavoidable. In situations like this, the risk increases because now these companies are interdependent not only as suppliers and providers, but in their intrinsic value and likely decision making insofar as shares can be voting shares. In any case, the C Suite and board sure know who owns %10 of the shares.
>In our world however companies are free to gamble on the side as long as their owners don't mind.
This constitutes an enormous systemic risk. We are treading in dangerous waters. The owners are not the only stakeholders in a company.
> This constitutes an enormous systemic risk.
Tell me about it. 2008 crash was a result of exactly that. Banks instead of doing banking focused on gambling on risky assets and lost. Nvidia gamble is looking less obviously bad.