Jensen Huang made mistakes that gave opportunities to his enemies. But the bigger mistake was his incredible greed, he should have been a happy supplier of an extremely valuable product, and accept competition and that his quasi-monopoly was only transient. But he wanted the entire cake for himself.
Greed and hubris. I think the turbulences will be painful to some, especially those who counted on Nvidia stock to finance their retirement.
The job of the CEO is to manage the company as well as they can, keeping business good today and ensuring the company has a tomorrow. It is not hard to intuit that this involves both short and long term thinking.
The whole "it's to maximise shareholder value" refrain is not actually a thing, AFAIK, despite it being something people like to keep repeating.
But they don't have a monopoly. Their marketshare is sinking, down to perhaps 45% of estimated TSMC CoWoS supply next year (down from close to 70% last year).
one way to spot that this makes no sense is to look at GPU rental prices [1]
if there were some cabal buying them to keep purchase prices high, then rental prices would be falling; it would be unprofitable to buy them in order to rent them out. but actually the opposite is true
I honestly find his podcast a little grating and his personality needlessly abrasive/smug at times, but at the end of the day I still read and listen here and there because the dude does nail it often enough to warrant some of his attitude.
It was an open secret that 'LLM inferencing as-a-Service' was a license to print money until very recently, and still is if you like CoreWeave, Crusoe, Xai etc. can get LLM inferencing deals from OpenAI and Anthropic.
Nvidia invested in genuinely investment attractive businesses. The "circular financing" accusation just seems like wishcasting from the anti-AI crowd.
"Nvidia was in talks to provide billions of dollars of guarantees to companies that couldn’t afford its chips. That included deals led by Huang’s son-in-law, Nico Caprez, who had been offering upstart cloud providers and data-center developers financing in the hopes of turning them into long-term customers."
...
"Amid the rollout of the program, Kress raised questions including how to decide which deals to pursue, how to value the guarantees, and how to calculate the return on investment, a person familiar with the matter said. Behind the scenes, she tried to rein in Huang’s son-in-law, who had been promoted to a vice president in January, people who worked with her said."
It sounds like there may have been a little bit of Nepotism. This article also suggests that Huang himself was uncomfortable with the deals Nvidia and the data centres it had invested in were making, although he appeared to shift blame onto those running the data-centres.
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"In Berlin during a conference, Huang, accompanied by his top sales executives, broadcast a new message to a half-dozen CEOs of companies that are major buyers of Nvidia chips who were seated around a circular table. He opened with a story that sounded like a fable, according to people who attended.
Huang had once found a soup vendor in Japan, he said, with a long line of customers. He joined the line, and after a long wait, enjoyed one of the best bowls of soup he’d ever had. When he asked for another serving, the soup-seller told him no—he had too many customers waiting and not enough soup for all of them.
“He’s a better businessperson than all of you,” Huang told the cloud computing CEOs. The soup-man doesn’t sell out all his inventory to one or two customers, but instead keeps prices high and his customer base diverse, the CEO said.
“You are not establishing the value of my products,” he said."
Forcing your customers to buy additional hardware they don't need to inflate the prices of your own product is a crime in the united states of america.
It get worse when we find out they did it to increase nvidia production for the purpose of being able to redirect more output to china.
The whole entire AI bubble was actually jensen's smuggling operation to china. These large data centers have no purpose and cost more money in power grid upgrades than any company will ever make operating them.
The only winners look to be jensen's bank account, the bank accounts of the CEOs that signed the deals to buy unneeded hardware, and the chinese buisnesses that were able to buy more nvidia graphics cards.
It is not a crime for these CEOs to drive their companies into the ground to make themselves richer. Most CEOs do this today. It is a crime if we find out all of this was really a chinese smuggling operation and that would make it the largest crime per monetary value in US history.
Everyone who made money on this smuggling ring has criminal liability. Just like with madoff, the people who withdrew gains had to pay it back because the gains weren't real. Not paying it back would make you an accomplice.
That sounds like horrible planning. Build the data center and when it is 90% complete then order the GPUs. The theory is that Nvidia says buy now or get nothing later.
What the Wall St Journal is saying is that Nvidia basically has an oversupply of GPUs that they are committed to buying from TSMC. The hyperscale companies are designing their own AI chips so they don't want as many Nvidia chips. So Nvidia is giving startups money to buy Nvidia chips in exchange for equity in the startup.
I say force them to FOSS their microcodes, firmwares, and drivers. Same thing for Intel/AMD. Same for all UEFI code. ARM doesn't get to escape either. No more 'appliance' Universal Machines; if you sell a Universal Machine as or in your product then you must allow the owner or primary leasee full access to it and its capabilities. This includes segmentation switches, which must not be permanent fuses. If a chip is segmented due to failure of manufacture, then the owner/leasee unsegmenting it should be at owner/leasee's risk.
Perhaps so. There's certainly a problem with producers using financialization to distort the market for their products. But I think financialization itself is the larger problem. Financial engineering of various kinds seems to make up more of our economy than ever, despite the lessons of the 2008 crisis, and I conjecture that the real economic benefits come anywhere near the nominal gains; that is to say, I we've badly unestimated the inflationary impact of ubiquitous financialization.
I don't think they need to be broken up. Nvidia needs to be investigated.
There are stories of huge amounts of sold chips sitting in warehouses unused. This could be channel stuffing which is illegal
There are stories of Nvidia threatening that customers have to buy these chips now or they will be cut off and not able to buy the next gen. That may be illegal
I guess you could say he was free to do what he wanted, he fucked around and found out. Had it been “unfree” he would have been backstopped a while ago.
I agree that the “invisible hand of capitalism” is ironic, but the free market is circular in and of itself creating an unfree market.
I'd love to be able to opt out and ignore copyright laws actually. That would be amazing. Let people ignore the government enforced monopoly and produce what they want in the free market.
Remember when Microsoft got in years of antitrust lawsuits over bundling a browser with their OS? Bring back that level of legal scrutiny to antitrust, and sever the absurdly close ties the US government has with the top 100 companies in the country.
This is just feels really misleading. Nvidia invested in startups that would turn around and help the market of companies that would buy from them grow.
That's not "deliberately keeping GPU prices high" and it's really weird to frame it this way.
It is good that Nvidia focused on supporting startups!
Greed and hubris. I think the turbulences will be painful to some, especially those who counted on Nvidia stock to finance their retirement.
But, big picture, this is good news.
The whole "it's to maximise shareholder value" refrain is not actually a thing, AFAIK, despite it being something people like to keep repeating.
well it's no secret that this sort of stock was not that good, I don't think that many people counted on nvidia for their retirement
Nvidia allegedly engineered scarcity by funding AI startups to buy its GPUs (techpowerup.com)
https://news.ycombinator.com/item?id=50493251
if there were some cabal buying them to keep purchase prices high, then rental prices would be falling; it would be unprofitable to buy them in order to rent them out. but actually the opposite is true
[1]: https://semianalysis.com/gpu-pricing-index/
They finance the selling of their inventory.
https://respawnfirst.com/multiple-reports-say-nvidia-manufac...
Zitron already has a video about it but he is just reaffirming what the article already said.
It was an open secret that 'LLM inferencing as-a-Service' was a license to print money until very recently, and still is if you like CoreWeave, Crusoe, Xai etc. can get LLM inferencing deals from OpenAI and Anthropic.
Nvidia invested in genuinely investment attractive businesses. The "circular financing" accusation just seems like wishcasting from the anti-AI crowd.
...
"Amid the rollout of the program, Kress raised questions including how to decide which deals to pursue, how to value the guarantees, and how to calculate the return on investment, a person familiar with the matter said. Behind the scenes, she tried to rein in Huang’s son-in-law, who had been promoted to a vice president in January, people who worked with her said."
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-- https://archive.is/gx14x
It sounds like there may have been a little bit of Nepotism. This article also suggests that Huang himself was uncomfortable with the deals Nvidia and the data centres it had invested in were making, although he appeared to shift blame onto those running the data-centres.
-------------
"In Berlin during a conference, Huang, accompanied by his top sales executives, broadcast a new message to a half-dozen CEOs of companies that are major buyers of Nvidia chips who were seated around a circular table. He opened with a story that sounded like a fable, according to people who attended.
Huang had once found a soup vendor in Japan, he said, with a long line of customers. He joined the line, and after a long wait, enjoyed one of the best bowls of soup he’d ever had. When he asked for another serving, the soup-seller told him no—he had too many customers waiting and not enough soup for all of them.
“He’s a better businessperson than all of you,” Huang told the cloud computing CEOs. The soup-man doesn’t sell out all his inventory to one or two customers, but instead keeps prices high and his customer base diverse, the CEO said.
“You are not establishing the value of my products,” he said."
It get worse when we find out they did it to increase nvidia production for the purpose of being able to redirect more output to china.
The whole entire AI bubble was actually jensen's smuggling operation to china. These large data centers have no purpose and cost more money in power grid upgrades than any company will ever make operating them.
The only winners look to be jensen's bank account, the bank accounts of the CEOs that signed the deals to buy unneeded hardware, and the chinese buisnesses that were able to buy more nvidia graphics cards.
It is not a crime for these CEOs to drive their companies into the ground to make themselves richer. Most CEOs do this today. It is a crime if we find out all of this was really a chinese smuggling operation and that would make it the largest crime per monetary value in US history.
Everyone who made money on this smuggling ring has criminal liability. Just like with madoff, the people who withdrew gains had to pay it back because the gains weren't real. Not paying it back would make you an accomplice.
Ok that sounds interesting and it's not in this article. Where can I learn about that?
Satya Nadella said last year they have GPUs sitting that they can't use because the data centers don't exist.
https://redmondmag.com/blogs/generationai/2025/12/microsoft-...
That sounds like horrible planning. Build the data center and when it is 90% complete then order the GPUs. The theory is that Nvidia says buy now or get nothing later.
What the Wall St Journal is saying is that Nvidia basically has an oversupply of GPUs that they are committed to buying from TSMC. The hyperscale companies are designing their own AI chips so they don't want as many Nvidia chips. So Nvidia is giving startups money to buy Nvidia chips in exchange for equity in the startup.
A quick search turned this article up https://www.investing.com/news/stock-market-news/faa-orders-...
Mellanox ([1]) acquisition by NVIDIA was a monopolistic move and they should be forced to spin out Mellanox as an independent public company.
The same applies to Hugging Face. That deal should have never been approved.
1. https://en.wikipedia.org/wiki/Mellanox_Technologies
There are stories of huge amounts of sold chips sitting in warehouses unused. This could be channel stuffing which is illegal
There are stories of Nvidia threatening that customers have to buy these chips now or they will be cut off and not able to buy the next gen. That may be illegal
Of course, free markets tend to become unfree without regulation they are a bit of a unicorn.
I agree that the “invisible hand of capitalism” is ironic, but the free market is circular in and of itself creating an unfree market.
It’s like the oil companies whining and fleecing us too.
What’s the move though?
Why is this false claim so persistent?
Companies are expanding productions everywhere. https://techcrunch.com/2026/06/29/south-korean-tech-giants-c...
Building fabs and getting them running takes years.
Do some people think that RAM production is a big knob that gets turned up at the factory and instantly we have more RAM chips?
It’s not. It happens ALL THE TIME. This isn’t “circular financing” which is a great meme term but is not factual.
That's not "deliberately keeping GPU prices high" and it's really weird to frame it this way.
It is good that Nvidia focused on supporting startups!