Premium: What If…We’re In An AI Bubble? (Part 1)

Source: Where’s Your Ed At Date: 2026-05-15 URL: https://www.wheresyoured.at/premium-what-if-were-in-an-ai-bubble-part-1/

Summary

Ed Zitron’s premium essay argues the AI industry is built on economics that cannot close: for the current valuation and investment trajectory to be justified, OpenAI alone would need to generate roughly $852 billion in revenue/funding over four years — a scenario Zitron treats as implausible rather than merely ambitious. The visible evidence he marshals includes millions of Blackwell GPUs allegedly warehoused rather than deployed, the gap between OpenAI’s stated $190B revenue projections and observable demand, and the structural dependency chain (CoreWeave, Oracle, Microsoft, Amazon) that requires OpenAI’s success to validate enormous capital commitments. Anthropic’s current annual losses with no clear 2028 path to profitability appear as a supporting data point. The full essay is behind a paywall; this summary covers the visible introduction.

Implications

• The AI-bubble debate thread. Zitron’s framing — that the entire hyperscaler stack is a demand-dependent house of cards — is the most direct version of the bear case in circulation. Part 1 of a series means this argument will compound; watch for the specifics that land in parts 2+, particularly around token-based billing math and data center construction commitments.
• Infrastructure over-provisioning risk. The GPU-warehousing claim, if substantiated, is a leading indicator of demand shortfall. Over-built inference capacity that doesn’t find workloads within 18 months creates write-down pressure across the hyperscalers simultaneously — a systemic event, not a vendor-specific one.
• Counterposition to enterprise deployment optimism. The Salesforce $800M signal and the Malta ChatGPT Plus deal are both in the opposite direction. The bubble debate and the enterprise deployment thread are the two poles of the current macro AI narrative; both are running hot simultaneously.