Gas prices should increase the cost of running data centers but when did AI ever need a profitable business model
this post was submitted on 02 Mar 2026
265 points (97.5% liked)
Lemmy Shitpost
39377 readers
3281 users here now
Welcome to Lemmy Shitpost. Here you can shitpost to your hearts content.
Anything and everything goes. Memes, Jokes, Vents and Banter. Though we still have to comply with lemmy.world instance rules. So behave!
Rules:
1. Be Respectful
Refrain from using harmful language pertaining to a protected characteristic: e.g. race, gender, sexuality, disability or religion.
Refrain from being argumentative when responding or commenting to posts/replies. Personal attacks are not welcome here.
...
2. No Illegal Content
Content that violates the law. Any post/comment found to be in breach of common law will be removed and given to the authorities if required.
That means:
-No promoting violence/threats against any individuals
-No CSA content or Revenge Porn
-No sharing private/personal information (Doxxing)
...
3. No Spam
Posting the same post, no matter the intent is against the rules.
-If you have posted content, please refrain from re-posting said content within this community.
-Do not spam posts with intent to harass, annoy, bully, advertise, scam or harm this community.
-No posting Scams/Advertisements/Phishing Links/IP Grabbers
-No Bots, Bots will be banned from the community.
...
4. No Porn/Explicit
Content
-Do not post explicit content. Lemmy.World is not the instance for NSFW content.
-Do not post Gore or Shock Content.
...
5. No Enciting Harassment,
Brigading, Doxxing or Witch Hunts
-Do not Brigade other Communities
-No calls to action against other communities/users within Lemmy or outside of Lemmy.
-No Witch Hunts against users/communities.
-No content that harasses members within or outside of the community.
...
6. NSFW should be behind NSFW tags.
-Content that is NSFW should be behind NSFW tags.
-Content that might be distressing should be kept behind NSFW tags.
...
If you see content that is a breach of the rules, please flag and report the comment and a moderator will take action where they can.
Also check out:
Partnered Communities:
1.Memes
10.LinuxMemes (Linux themed memes)
Reach out to
All communities included on the sidebar are to be made in compliance with the instance rules. Striker
founded 2 years ago
MODERATORS
Data centers in Silicon Valley stand empty, awaiting power
One of the more curious artifacts of the recent surge in data center construction has been filling these megaliths with hardware and then... not plugging them in. Either because turning them on would flatten the local electrical grid or because they're loss-leaders for which data cycles only cost the company money.
So you've got this multi-billion dollar paper asset that wows investors while it gathers dust. And then you go off to build another one, because people will fling their unlimited borrowing power at you to reap another quarter of double-digit growth in speculative valuation.
It's okay, Trump signed that executive order telling them to provide their own power for data centers. Which means now our tax dollars won't just be used for data centers, they'll be used for power plants too. Another executive order or two and we'll see company towns come back.
Which means now our tax dollars won’t just be used for data centers, they’ll be used for power plants too.
Sure... maybe...
Part of the problem with power plant construction is that our production capacity is largely maxed out. If you want a new gas power plant, you go on a waiting list that's two years long (conservatively). Wind and Solar production are also at their domestic limit. Nuclear continues to be a pipe dream.
And, again, it cannot be overstressed that turning on a data center means a net-negative cash flow. These facilities cost more to operate than they earn, even under a ludicrously generous state contract. Why would you want to power them on these terms?
Hence the sarcasm dripping from my statement.
I think some people look at this arrangement and say "This is unsustainable, the cards have to come down at some point", because it is a fucking stupid way to run an economy.
But, like... the money keeps flowing. And it keeps flowing because the Fed and the Treasury are implicitly backstopping the malinvestment. And their pockets are functionally endless.
I wish you could just roll your eyes and make these abhorrent economic decisions stop. But I'm afraid these people might legit die trillionaires without a regret in the world (other than failing to solve Immortality Science with an LLM), because we've stacked the economic deck so high up in their favor.
The pockets might be endless, but if you keep pulling stuff out without something real going in you end up pulling out handfuls of lint and nothing else.
LintCoin's value is through the roof, though. You'd be a fool not to hand them all your boring old American dollars.
And don't even get me started on TulipCoin.
It’s gonna be company towns with only 8 or 9 residents though. And only 2-3 will actually go into the data center.
The power companies will just raise residential rates and cut the AI costs.
This might age poorly, but wishful thinking, I think.
Nothing about the "AI" speculative bubble is likely to be impacted by the war in Iran.
oil skyrocketing in price and the economy and stock market taking a huge hit could cause the investments required to prop up the bubble to run out of steam
The parts of the ~~economy~~ stock market that would be heavily impacted by oil prices are already in the gutter.
The parts of the economy that would be heavily impacted by oil prices
Literally all of it. https://www.investopedia.com/ask/answers/06/oilpricesinflation.asp
are already in the gutter.
You're not wrong. Does not refute my claim though.
Segregate the market into "AI" and "non-AI" segments for simplicity.
Looking at the thousand or so "investors" who's money matters at this scale, there's no point in selling "non-AI" stock to fund "AI" investments already, these markets are already low. Adding the Iran war to that isn't changing anything. More likely, they are borrowing against existing "AI" stock and reinvesting that (oversimplification, but speaking broadly). Additionally, one of the big sources of these loans is Saudi Arabia, which benefits from the higher oil prices.
The only other way in which oil prices impact "AI" is through energy costs, which impacts the immediate profitability of "AI", which "investors" have shown they are unconcerned with.
Or, to simplify,
Nothing about the "AI" speculative bubble is likely to be impacted by the war in Iran.
the economy and stock market taking a huge hit
Two things that have also failed to manifest, in large part thanks to the prolific state spending following COVID.
Keep in mind, the event that really knocked over the tower of cards in 2008 was Greenspan's decision to raise interest rates (very sharply) in 2007. Trump's very obviously not going to do that. If anything, he's been working overtime to get interest rates lower, because he knows cheap money = high (raw) GDP growth and low unemployment.
What we're seeing isn't recessionary. It's a glacial shift in the economic priorities of the US, from a post-Reagan titanic banking juggernaut to a post-COVID more-WW2-style global arms depot. The US economy increasingly makes cops and bombs and machines that assist cops and bombs. And there's no recognized upper limit for demand on these goods and services. Not under current geopolitical conditions, anyway.
Two things that have also failed to manifest, in large part thanks to the prolific state spending following COVID.
We're still only 3 days into this war. And yet this is already manifesting right now in real life as we debate it on the internet. https://finance.yahoo.com/news/live/stock-market-today-dow-sp-500-nasdaq-sink-while-oil-prices-jump-as-iran-attacks-jolt-markets-235000934.html
Trump’s very obviously not going to do that.
Yes, agreed, this is very obvious. Because Trump does not have control over the interest rates.
We’re still only 3 days into this war.
The second big Iran-Israel conflict in less than a year.
And yet this is already manifesting right now in real life as we debate it on the internet.
Ah yes. A total nosedive of 0.30%.
This is the Uno-Reverse "Why you complaining when the DOW is over 50,000!" line. Any token sell-off gets reported on like it's Black Friday.
Because Trump does not have control over the interest rates.
He's lining up his pick to replace Powell as we speak.
I'll come back to this in 4 weeks. See you then 😉
You gotta at least give yourself a full Friedman Unit.
I wouldn't take any kind of advice from Friedman...
Well, it's been 4 weeks, so I'm back! Here's the S&P 500 over the last month, with no end to the Iran war in sight.
Fair enough. Hope you made some money on the plunge. I would not have guessed an 8% drop, given the weirdly stubborn endless equities enthusiasm, but here we are.
Yeah 8% over 1 month is pretty huge. Not suggesting this will actually happen, but if the current trend continues at the same rate, it will be a 62% loss over a year.
A short period of time before the Iran war started, I pulled all my money out of the market and am 100% in CDs now. I didn't time the top perfectly, but that's never really my goal anyway, and I'm definitely beating the market right now with modest returns.
Not suggesting this will actually happen, but if the current trend continues at the same rate
It never does. Markets move periodically - early slow change, mid-point rapid change, tail slow change - for the most part. Nevermind that a 62% sell-off raises the question of "Who is selling?" versus "Who is buying?" Dollars are still far too cheap for a plunge that steep.
A short period of time before the Iran war started, I pulled all my money out of the market and am 100% in CDs now.
CD rates are shit right now, thanks to low interest rates.
You'd be better off in utilities or REITs. US energy companies have done very well in the wake of the Hormuz straight closure. I dropped a bunch into United Healthcare recently, thanks to their bargain basement price. Doubt it'll pay off soon. But I see a healthy upside long term.
load more comments
(2 replies)
Why would a war with Iran cause oil prices to skyrocket?
The prices are what they were in January, according to the article.
The article is from yesterday, the prices went from 65$ to 70$ compared to yesterday. Not huge, but an increase.
They already are.
If anything, department of war spending on AI might prolong the bubble.
Nah, the DoD contract is also very likely running at a loss, like every other subscription.
Makes you wonder if that was the idea. They used AI in the Venezuela attack, too.
There's also the betting market that Trump is very friendly towards, and we've already seen bets on military strikes pop up days before anyone knew about it, so someone's making money on insider info.
Meme feels like
- Steal underpants. . .
- Profit!
"What the f? we can't even use this to kill children efficiently??" - when Sam Altman's WarGPT fails to prove itself
everything they like (oversized pick-up trucks, semi automatic rifles, alcohol) are used to kill children more efficiently than their alternatives
I'm sorry, but it really bugs me that the small domino is a fucking war. While the big domino is depicted here as the AI bubble bursting.
At a minimum, it's a * poor use of the meme *, but really the priorities are just way out of whack.
*edit
I hereby formally apologize for the inaccuracy in my shitpost🧐
🫡
I think it's more like sending a second out of control train to catch the first one. There's no doubt eah train will crash, and that it will be bad, but now we have more variables as to which will crash first and how bad, with the exciting new possibility of each making each other worse than they would have been.
High gas prices killing AI was not on my bingo card but it is funny as fuck.
Don't let Trump do anything, if you can help it
Including breathe
Praying for the burst 🙏
Too many steps until then.
I've had "AI Bubble Burst" on my bingo card since 2023.
The thing is, the AI bubble is mainly a big fucking bet.
The bet is, that the new data centers will bring us AGI or even ASI.
As long as they haven't tested that theory it's unlikely that the bubble will burst - they just put too much money in there to fold now. It's "all in" for AI companies.
They hope that AI will take over most white collar work, and with robotics later most work overall.
Shut them all down
Datacenters getting terror attacks in 3...
I have a bad feeling the MIC might prop up the bubble. It's been the US's "economy up" move for decades
view more: next ›