Don’t worry, it’s just a matter of capital: it’s a phrase sung for months to explain that the race to invest in artificial intelligence (AI) is ultimately less dangerous. The impending burst of the stock market bubble will simply wipe out shareholders and we’ll just leave it at that.
It’s just that the situation has changed, as revealed by two surveys from Wall Street Journal (WSJ) And Financial Times. The AI giant has an unprecedented amount of debt, with debt levels exceeding 6%.
THAT WSJ lists three giant treaties. First, Meta, which allowed the collection of around 30 billion dollars (26 billion euros) in debt, including 27 billion dollars from Pimco and Blue Owl for a period of twenty-four years at an interest rate of 6.58%. The goal is to invest in a megaproject in Louisiana called Hyperion. This debt does not appear on Mark Zuckerberg’s company balance sheet, because it is financed by vehicles owned by Pimco and Blue Owl.
Second example: a project data center on behalf of Oracle and OpenAI in Wisconsin and Texas; or $38 billion over five years at a rate of 6.40%. Because the AI company led by Sam Altman is a startup, it cannot take on debt; As for Oracle, its credit rating is poor. As a result, the deal was financed through a clever arrangement organized by American bank JP Morgan and Mitsubishi UFJ Financial Group. The debt, financed by about thirty institutions, will be paid with rent paid by Oracle, which will bill OpenAI for its services.
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