Dwarkesh Patel: evaluation

Transcript context

…Let's say you're a bank, and you're trying to decide whether to lend GE a bunch of money to expand production of their gas turbines. You can write them the check today. They'll start scaling up their factories. They'll start to see the benefits of that in three or four or five years. You don't know if the AI bubble will have burst by then. You don't know if China will have invaded Taiwan by then. You don't know if Siemens or Philips or someone will have outcompeted you. You don't know if GE's major looming structural problems will cause it to be unable to compete, as it has in the past. In order to make that money back, you also have to then operate that plant at that capacity for 20 years. If I was looking at the same charts as they're looking at right now, I'd say, “What are the odds that in 25 years' time we can produce gas turbines at a price that is relevant in a world where solar is already at its current price and batteries are at the price where they're already?” You cannot win. I feel like there was actually a similar discussion a year back when AI people were like, "No, AI is real. This is going to happen." Then SK Hynix, Samsung, etc. , were like, "We're not ramping up HBM production because HBM is used largely for AI workloads, and if this demand doesn't continue, then our additional manufacturing capacity for HBM will not have been worth it. " Then there was another bottleneck with CoWoS. What happened after that? Did they end up indeed ramping up their production?…

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