Core Viewpoint - The article discusses the potential risks associated with the current AI investment boom, drawing parallels to the financial crisis caused by CDOs, and highlights the increasing use of Special Purpose Vehicles (SPVs) by tech giants to manage their capital expenditures and debt [3][6][10]. Group 1: AI Investment and Financial Risks - Investors are concerned that the AI investment frenzy may lead to a collapse similar to the CDO crisis, as tech giants' market valuations have soared while their data center investments are not yet generating returns [3][6]. - Cantor Fitzgerald analysts project that the total annual spending of the four major cloud service providers—Microsoft, Google, Amazon, and Oracle—will reach $520 billion by the end of next year [4]. - Bank of America reports that top tech companies' capital expenditure plans are consuming nearly all of their existing cash flow, indicating potential cash flow limitations for AI firms [5][6]. Group 2: Use of Special Purpose Vehicles (SPVs) - SPVs are being increasingly utilized by companies like Meta Platforms and xAI to raise funds while isolating debt from their balance sheets, similar to practices seen before the 2008 financial crisis [7][8]. - Meta has raised approximately $30 billion through an SPV for data center construction, while xAI plans to raise $20 billion for purchasing NVIDIA processors [8][9]. - The use of SPVs allows companies to separate specific project risks and provides investors with more funding options, although it raises concerns about transparency and market liquidity [9][10]. Group 3: Market Dynamics and Future Projections - OpenAI has committed to investing around $1.5 trillion over the next decade, with a recent $38 billion agreement with Amazon for NVIDIA chips, further entrenching the interconnectedness among AI giants [10]. - As companies increasingly rely on off-balance-sheet financing tools, investors may need to scrutinize the nature of these financing methods and their implications for overall market stability [10][11].