The artificial intelligence (AI) industry is inflating a dangerous economic bubble through circular financial deals among major tech companies.
With over 234,000 views and 14,000 likes, the video argues that these practices, led by companies like OpenAI, Microsoft, and NVIDIA, are creating a facade of growth while fostering a system of technofeudalism—where tech billionaires act as modern feudal lords, extracting wealth and power at the expense of society.
This article summarizes the video’s key claims, integrating its depiction of technofeudalism as a critical lens for understanding the AI bubble’s implications.
Major tech companies are engaging in "circular deals" to artificially inflate their stock prices. These deals involve investing in OpenAI, which then uses the funds to purchase products or services from the same investors, creating a cycle of recycled money.
Specific examples include:
Microsoft: Invested over $13 billion in OpenAI, receiving 20% of its revenue. OpenAI uses this money to pay for Microsoft’s cloud services, which Microsoft books as cloud revenue growth, despite the funds originating from its own investment.
NVIDIA: Commits up to $100 billion to OpenAI, which then buys NVIDIA chips, boosting NVIDIA’s revenue and stock price.
Oracle: Secures a $300 billion deal from OpenAI for services over five years, even as OpenAI projects an $8.5 billion loss in 2025. Oracle, in turn, purchases chips from NVIDIA.
AMD: Provides warrants for up to 160 million shares (potentially 10% of the company) to OpenAI, which commits to buying 6 gigawatts of AMD GPUs.
Broadcom: Collaborates with OpenAI on custom chips, with OpenAI pledging up to $500 billion.
These arrangements, totaling $1.3 trillion in commitments for 2025 alone, are described as unsustainable for OpenAI, a company expected to burn through $115 billion by 2029 without profitability until then.
This to passing the same $100 bill back and forth while claiming mutual profit, arguing that it masks OpenAI’s financial instability and inflates market valuations.
The video frames these financial maneuvers as part of a broader system of technofeudalism, where tech billionaires act as modern feudal lords, controlling digital infrastructure and extracting wealth from a dependent populace. It describes tech moguls like Sam Altman and Mark Zuckerberg as "tech overlords" who leverage AI to consolidate power, drawing parallels to medieval feudalism where lords owned land and serfs labored for survival. In this digital fiefdom, platforms, data centers, and AI systems replace land, and ordinary people are akin to serfs, reliant on tech ecosystems for work, communication, and services.
This technofeudal structure manifests in several ways:
Wealth Concentration:
‍The video accuses tech elites of "extracting the last drops of wealth from a dying system." Circular deals inflate corporate valuations, enriching billionaires while ordinary people face stagnant wages, unaffordable housing, and declining birth rates. It notes that during the COVID-19 crisis, billionaires’ wealth surged 58% while others struggled to afford groceries.
Surveillance and Control:
AI is used in industries like healthcare (diagnostics), insurance (raising premiums), and education (automated grading), often prioritizing corporate interests over individual well-being. The video claims tech companies and governments deploy AI for surveillance, eroding privacy and autonomy, much like feudal lords monitored their domains.
Dependency on Technology:
The public’s reliance on AI and digital platforms mirrors feudal serfs’ dependence on lords. The video sarcastically critiques the narrative that tools like ChatGPT empower individuals, pointing out that economic realities—such as inability to afford homes or children—contradict claims of a golden age of opportunity.
Political Influence:
Tech overlords are said to interfere in governments, developing surveillance technologies deployed against citizens. The video suggests they wield power surpassing that of governments, positioning them as sovereigns in a technofeudal hierarchy.
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The video highlights the dominance of the "Magnificent Seven"—Apple, Microsoft, NVIDIA, Amazon, Meta, Google, and Tesla—which account for 34% of the S&P 500’s value. All are deeply involved in AI deals, making retirement accounts like 401(k)s and pensions reliant on the AI sector’s stability. It claims that without these seven, the S&P 500 has shown no growth in two years, underscoring the market’s vulnerability to an AI bubble collapse. The video predicts mass layoffs, foreclosures, and taxpayer-funded bailouts, referencing the $498 billion bank bailout in 2008 as a precedent.
Failing Returns and Waning AI Adoption
Despite the hype, the video cites evidence of AI’s underperformance. An MIT study reveals that 95% of companies using generative AI have seen no measurable return on investment, and adoption rates are declining among larger firms.
The startup Lovable, valued at $1.8 billion eight months after launch, saw a 49% drop in web traffic in four months, illustrating the gap between investment and performance.
The video argues that AI is replacing entry-level jobs and increasing workloads rather than delivering promised societal benefits, contributing to a dystopian reality of "bots, AI slop, and corporate surveillance" rather than human connection.
Tech billionaires are bracing for societal fallout, a hallmark of technofeudalism’s elite insulation:
Mark Zuckerberg:
Owns a 1,400-acre Hawaii compound with a 4,500-square-foot underground shelter.
Sam Altman:
Reportedly has a deal with Peter Thiel for refuge in New Zealand during apocalyptic events.
Ilya Sutskever:
OpenAI’s former chief scientist discussed underground shelters for scientists before releasing artificial general intelligence (AGI).
Reid Hoffman:
LinkedIn co-founder claims half his billionaire peers have or are planning secret hideaways, termed "apocalypse insurance."
Citing journalist Douglas Rushkoff, suggests these billionaires recognize the instability they’re creating but choose to protect themselves rather than address it.
This is framed as creating a "Hunger Games"-like scenario, where tech elites anticipate backlash akin to the French Revolution, fortifying themselves against an exploited populace.
The AI bubble’s scope extends beyond tech, with industries like healthcare, insurance, education, power grids, and supply chains adopting AI. Governments, including the U.S. (with $328 billion invested in AI from 2019–2023), are heavily committed.
OpenAI’s Stargate project, building data centers in the U.S., Norway, and Abu Dhabi, exemplifies this global push. However, the video warns that ongoing economic challenges—recessions in Sweden and Germany, high inflation, and rising unemployment—amplify the risks of a bubble burst, which could devastate economies worldwide.
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the AI bubble as a symptom of technofeudalism, where tech billionaires orchestrate circular deals to inflate valuations while preparing for the fallout of an unsustainable system.
By controlling digital infrastructure and leveraging AI for surveillance and profit, these overlords extract wealth, leaving society vulnerable to economic collapse.
The video warns that while AI may persist post-bubble, its current trajectory prioritizes corporate control over human welfare, urging viewers to question the ethics and sustainability of this technofeudal landscape.
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