Monty Fiddlesburn @FiddlesWithMe

As someone with a portfolio of energized land assets here is what I am seeing: 1. Neoclouds are disorganized and poorly capitalized. Some are definitely better than others however. 2. Hyperscalers are intractable, bureaucratic organizations that take 3 months to do an NDA and want 18mo escrow periods. We built our portfolio by competing against these terms because of our speed and simplicity. The more future assets orgs like ours win, the bigger the problem for the hyperscalers downstream (see 3). 3. There are delays in the existing pipeline that will catch people off guard in 2027. Hyperacalers will (obviously) react by focusing on their own internal compute needs over any third party. If the third party is a model company, they will tell them to go through their model router where they will also take a non-trivial vig. Them telling Ant they have no compute for them (rumored in Ant’s S-1) if true is a huge tell that this is already happening. All of this is to say that it does look like there will be a lot of partially stranded compute and compute sitting in inventory in 2027 than is currently forecasted. This is bought and paid for but effectively underearning (below total cost of capital) or collecting dust. We see this as true for everyone - model companies, hyperscalers, neoclouds except ONE (you can guess which one). This dislocation will benefit two kinds of orgs: the non-bureaucratic big scalers who can build industrial scale quickly and the nimble, well capitalized players feeding them. 2027 will be a turbulent year because it will clear out a bunch of wrong/bad bets. It will also be a consolidation year for a few.

Elon Musk @elonmusk

3 days ago

@Yuchenj_UW I think we’re going to see a lot of stranded compute in partially complete data centers

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Same thing happened in shale collide.io/old-man-coffee…

Elon Musk @elonmusk

3 days ago

@chamath Pretty much. As of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers. SpaceX closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch

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Throwback to this hilarious 2015 email Barclay's Power & Utilities sent out to their incoming intern class: Barclays Power & Utilities: Welcome to the Jungle The Ten Commandments for Wall Street Interns Incoming Intern Class of 2015, Welcome to Power! I am sure you are all busy at training, but in the interest of helping your transition into the summer, and hopefully helping some of you secure Full-Time offers, I wanted to introduce you to the 10 Power Commandments. Respect them, love them, live them. You may have heard different stories about Barclays Power – go on WSO and you’ll see us called the “frattiest group”, “top Power group on the street”, or the group with the “best PE placement” – needless to say we are a unique group at Barclays. And with that come unique rules. For 9 weeks you will live and die by these: 1. Our group dresses very conservatively. Given that it is summer, no socks is accepted and, in fact, encouraged. (Men: On your first day at the desk, it is customary to wear a bowtie and/or suspenders). 2. Remember: this is a summer internship for a full-time offer. It won’t be easy. If you can’t handle the heat, get out of the kitchen. 3. We expect you to be the last ones to leave every night…no matter what. That’s what good summer analysts do. (Also getting in earlier than me would be a power move – You should enjoy your casual 9:15AM PT arrival time this Friday, but I wouldn’t get used to it). 4. During your first few weeks we ask that you direct all of your questions to Michael Lomio. Tell the other summers too, Michael is industry agnostic. If you ask me a question it will be noted. 5. Never take your jacket off at work. This is investment banking, ladies and gentlemen. Other groups may be more liberal when it comes to summer dress code, unfortunately were not 6. You will be assigned junior “mentors”. It is much appreciated if you would bring breakfast in for your respective “mentor.” Some people are more particular about this than others. 7. I recommend bringing a pillow to the office (yoga mat works as well). It makes sleeping under your desk alot more comfortable, in the very likely scenario that you have to do that. 8. You are expected to allocate at least half your seamless web order for group appetizers/snacks for the month of June. No questions asked. Once the 2nd years leave, you can enjoy your $25 allocations. 9. Have a spare tie/scarf or two around. You never know when your associate will run out of napkins. 10. When you need to leave your desk there will be a sign out sheet outside your cubes. Please fill it out including where you went and for how long. This is important come the end of your internship. I hope it is clear from the rules above that the internship really is a 9-week commitment at the desk. You are here with the sole goal to impress the group enough to receive a FT offer. During my summer in the group an intern asked our staffer for a weekend off for a family reunion – he was told he could go. He was also asked to hand in his blackberry and pack up his desk. Some of you have asked for training materials to study up on before you start. Love the enthusiasm. First, I would recommend reading the GS Elevator twitter feed for some social cues. It might be seen as a joke to some people, but around here I think many people find it insightful. Second, I have attached a fairly simple LBO for Staples. Understand this will be a bit tough for some of you without a Finance / UG business degree, but we believe in you. There’s a reason each of you was picked for the group. We expect you to give this your best shot and send us a completed LBO model with a short write up by Friday end of day. None of you will have this 100% correct, that’s expected. We also still expect you to complete a significant portion of it. Welcome to the big leagues, boys and girls. Play time is over and it’s time to buckle up. Once you hit the desk, your lives will be your work for 9 weeks. Please respond promptly to acknowledge you’ve received this e-mail (anytime in the next half hour would be fine) and to confirm that you are onboard for the summer. We know you have access to e-mail, so there’s no way to avoid this. If I remember correctly, you are probably doing training with Sean Clovey from IT, or Market Mark from TTS. Other than that, I look forward to meeting you all, and I hope you’re excited to join the group! We sure are looking forward to having you here! Yours Truly, Justin P.S. There are a number of typos in place in the email above. These are on purpose. First person to email me back with at least 3 highlighted typos is off to a GREAT start!

x.com/i/article/2114…

This is a tough market. It's hard. Not "spreads are a little wider" hard. Over the last month, CCCs have widened about 5x as much as BBs. The 10-year is above 5% and oil is over $100. Lots of smart, well-run funds are having humbling years. This isn't 2008 though. Nothing systemic is breaking, but there are lots of specific problems showing up at once: - software loans marked at par that wouldn't clear anywhere close - multi-year AI builds being funded with one-year bridge financings - a struggling macro environment with dispersion amongst consumer behavior - a CCC cohort trading like the debtor is at the courtroom steps - semi-liquid funds selling what they can, rather than what they want, when redemptions come The index is meaningless. The dispersion underneath proves nothing is contained, even if the headline suggests it is. That is what makes this so painful. You can't hedge it with one trade and owning "the market" doesn't save you. You have to know what you are investing in, read the documents, and know exactly where you sit when the music stops and things change. Everyone who has been doing this long enough knows that history rhymes. This isn't the GFC, this isn't 2018, and this certainly isn't 2020 or anything we've seen since. What this is, is an unrelenting tape. Volatility creates uncertainty. Looking back, I remember exactly where I was and what I did during each real period of volatility in my career. It is hard to go through it, but how you act internally, externally, and how you handle it says everything about you and your skill set. Everyone is a genius in a bull market. Nobody is a genius today. Three things matter today. - cash, because whoever still has it when they need to deploy it will set the terms - relationships, because when the liquidity disappears what you have is the LPs who trusted you for not reaching for yield at the top, sponsors who engage, and partners who pick you up - credit selection, because the market has stopped paying anyone for beta Every great credit vintage has started like this. Forced sellers, good assets on bad balance sheets, and prices that assume the worst with actions first, questions later. The tide turns. It always does. The patient people with dry powder will get paid. This too shall pass.

A collection of BoringBiz primers for restructuring and distressed investing 🧵 1/ Restricted Groups

@Kalshi_Finance @grok what is the source.

Of course he will say this. If the funding stops he loses. He wants the world to know if you stop this, they will struggle.

unusual_whales @unusual_whales

a week ago

BREAKING: BlackRock's Larry Fink says that a data center moratorium could trigger a recession, per CNBC

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It’s all fucked

if i give you 3 days to do whatever you have to do and you cannot get access to a bloomberg terminal, i will take your investment advice with a grain of salt

lets try this twitter thing out again (anonymously)

The AI trade is becoming a credit trade. Welcome to the desk boys, the coffee is bad and the bid is worse

zerohedge @zerohedge

2 weeks ago

first data centers, now hyperscaler CDS just hit all time wides

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BREAKING: TSMC reported third-quarter net profit of NT$763.1 billion, up 68.7% from a year earlier. TSMC’s third-quarter operating margin came in at 58.7%, exceeding the guidance of 58% The company’s free cash flow surged to NT$476.56 billion, from NT$139.38 billion a year ago

If you want to learn about the financing of data centers, read this. Chuck ran Kayne Anderson's $6.5B energy fund and draws a lot of parallels between oil and gas financing and data centers.

Chuck Yates @nimblephatty

2 weeks ago

Spent 20 years watching banks lend against rock on a formula built for a different rock. Now they're lending $60 billion against chips on a depreciation schedule built for a different chip. I know how this movie ends. I was in it. Link below to new Old Man Coffee.

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Ok who did this

If Texas wins 11 regular season games I go to the Texas stadium and will put a tortilla on the sidewalk , pay a homeless man $100 to shit on it then I will it eat it and will not grab a glass of water for 3 minutes

A hot girl on twitter can get thousands of likes but how many can this photo of Distressed Debt Analysis by Stephen Moyer get

this is f*cking gold Andrej Karpathy joined Anthropic five weeks ago. Two Anthropic seniors just made Karpathy's loop 1000x better with "Graph Engineering" the agentic systems got 1000x better the moment you wired agents into a graph I dropped it into my setup. The very first response was different. Not slightly different. Completely different. Claude stopped giving generic answers and started working exactly the way I think. Bookmark it before it gets lost in your feed. Read it now, then check the article below.

CyrilXBT @cyrilXBT

3 months ago

x.com/i/article/2077…

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This is huge news! And yes, it applies to US Anthropic users also. Big implications for the legal profession, content creators and beyond. Moving forward all Claude-written text will carry a Claude watermark. This watermark makes detecting AI-generated writing easy. Court filings, AI slop content, privilege issues, etc etc are now all easier to detect…

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NIK @ns123abc

3 months ago

🚨 JUST IN: Claude models will now have invisible watermarks embedded in ALL text, and ALL metadata attached to files…

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Instead of spending 2 hours on a movie... Spend 1 hour watching this Anthropic Claude for Finance lecture. It might be the most valuable free resource on quant AI available right now. Bookmark it, make time for it today, and thank yourself later.