Post #2003310

Artificial Intelligence is spelled "O.P.M.". Meta is only risking 20% ownership in its own 2GW datacenter. The rest is funded by selling A+-rated 144A investments. S&P rated it A+ because Meta's name is attached. But it's lower than Meta's AA- rating because Meta pledged no equity of their own into the project. They convinced Blue Owl to pledge $2.5BB of their own. Investors in Blue Owl and other private credit companies can't take their money out due to restrictions on share redemption. Meta signed 11 different leases (one for each building). They won't pay rent until June 2029. Only on the hook for 4 years. And, if they don't have equipment consuming power, they only pay a minimum rent + $/MW consumed. Lease renewals are optional. The properlty is on a 15-year amortization plan to pay back the local power utility with minimum monthly payments regardless of consumption. Who are the Other People in O.P.M.? Probablly you. Pimlico, Black Rock, and a bunch of other investment companies that manage your retirement accounts and portfolios. And, the businesses who are in the same insurance and re-insurance pools as the Meta/BlueOwl joint venture. Your portfolio probably invests in those, and in the insurance companies who will be paying out losses in the future. Losses? If the datacenter won't come online until June 2029 or later, Will cheaper locations already be online? Will the A.I. bubble have burst already? Other People's Money = you and me, eventually.