That's not the metric. The legal system is pay-for-delay, not pay-to-win. Once you have enough money to delay, it becomes a contest of who has the longer runway, and that probably goes to the frontier labs rather than the neoclouds who have little alternative revenue and comparatively airtight debt obligations.

> take-or-pay contracts are unenforceable if it would bankrupt the buyer which is the more likely resolution in this case. However, this does not mean frontier labs just get to walk away. They would settle in court for a penalty

Regardless, the terms come down to positioning and bargaining power. Runway vs obligations. This seems to dramatically favor the labs.

Two companies account for most of the frontier R&D, and something like 7 companies account for a huge portion of growth in the stock market. The government, especially under Trump, is very focused on continuing to see those numbers go up.

I also expect the government is pretty bought in on AI being the future and on us being in a race with China. They'd have to bail out the labs for those reasons alone.

Lastly in my opinion, Trump has a pretty socialist bent to him and regularly talks about a sovereign wealth fund owning portions of companies. He'd love to have take a partial stake in AI companies, and a bail out is a great way to do that.

Though I agree with you a bailout is a slap in the face. In my opinion bailouts shouldn't be legal, governments should pro actively be making sure individual corporations don't become so large that a failure would wreck the economy or national security.

I live in a state that votes heavily in one direction, most states are the same. Its fine for me to vote, but the winner of a majority of states is pretty well decided before a ballot is cast (by strong majority, I'm not claiming fraud).

Where this bubble differs from the dot-com bubble is that valuations have very strong, organic user demand behind them. In 1999, prototype websites with few customers were getting IPOs worth hundreds of millions. This time, demand is insatiable. Frontier mdoels also has very low global penetration, relatively speaking, so the TAM permits exponentially more sales, in theory.

However the risks are numerous for these labs. Foremost is that Chinese labs are able to easily distill frontier models. A tiny fraction of the cost of training, and they have a close approximation. Second, models are getting much more efficient per task. Companies are already discovering what "good enough" looks like, and it often ends up being much cheaper than what Anthropic and OpenAI are selling. This will only accelerate.

My investment thesis is bullish on the entire AI stack except the frontier labs. I think power generation is going to see huge demand. Ditto for infrastructure and data centers. Ditto for the products and services created by these models.