This is text book market mechanics. Demand rises and so do the prices. As a consequence the demand is somewhat dampened and therefore the market can slowly (!) heal. Due to the shit ton of money that is and can be made, new actors are incentivized to enter the market and existing actors are incentivized to increase their capacity (so no one else jumps in and grabs parts of it).
Now the question is: is it a good sign if such a big number of buyers are willing to throw such an excessive amount of money at you? Probably not, so you might bet on this not playing out in the long run. And the following crash will be hard, because then all the components from the closed data centers would hit the market at the same time with all your backorders going poof.
There still is not a path for data center components to be used in your gaming rig. They are not compatible and you can’t really adapt something like RAM I would wager. You’d have to tear off the chips and make new boards.
If a crash dumps hardware on the market, I bet someone will find a way to make use of it.
But I don’t think it will devalue, local models work and are useful, so if most datacenters closed tomorrow, I bet they’d be able to sell that hardware at decent prices to all sorts of companies.
So when is the free market gonna correct this?
When the AI black hole inverts.
~2-3 years when the new fabs come online, assuming we’re not still spamming new DCs. If we keep spamming new DCs for the next 3 years, then longer.
This is text book market mechanics. Demand rises and so do the prices. As a consequence the demand is somewhat dampened and therefore the market can slowly (!) heal. Due to the shit ton of money that is and can be made, new actors are incentivized to enter the market and existing actors are incentivized to increase their capacity (so no one else jumps in and grabs parts of it).
Now the question is: is it a good sign if such a big number of buyers are willing to throw such an excessive amount of money at you? Probably not, so you might bet on this not playing out in the long run. And the following crash will be hard, because then all the components from the closed data centers would hit the market at the same time with all your backorders going poof.
There still is not a path for data center components to be used in your gaming rig. They are not compatible and you can’t really adapt something like RAM I would wager. You’d have to tear off the chips and make new boards.
If a crash dumps hardware on the market, I bet someone will find a way to make use of it. But I don’t think it will devalue, local models work and are useful, so if most datacenters closed tomorrow, I bet they’d be able to sell that hardware at decent prices to all sorts of companies.
I think if that happens, much stock will be intentionally destroyed before anything like that can happen.
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When the AI bubble bursts, or the various electronics suppliers and their suppliers get more factories/capacity online in 2028
Eric Andre as “The Free Market” shoots consumer RAM production; “Why would Samsung do this?”
Never, you know how this games goes.