New home of @David_Charts. Armchair economist, sci-fi fan, impressed by good data viz. Node in the vast left wing conspiracy. Facts have a liberal bias.
Blue territory.
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David Doney retweeted
Everyone should read Jack Smith's report:
Read the full special counsel report on Trump's Jan. 6 actions
| PBS News share.google/HRyR0AuaBsnbbax…
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A 31-page report from GS: "Harnessing AI for the Real Economy" Link to download.
goldmansachs.com/what-we-do/…
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"Corporate bond markets have been hyperscalers' primary source of financing. Their gross issuance increased markedly, topping $100 billion in 2025 (Graph A1.B). Most issuance was longterm, with maturities over five years, locking in funding for multi-year build-outs. However, credit default swap (CDS) spreads rose (Graph A1.C), especially for hyperscalers with lower credit ratings, reflecting both the volume of supply and uncertainties around the projects' payoffs."
bis.org/publications/qr-2026…
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David Doney retweeted
Me and @econJaredB also just posted a similiar analysis and have qualitatively similiar results, too. @PeterBerezinBCA and @econcallum likewise have done the same.
econjared.substack.com/p/ai-…
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David Doney retweeted
New BPEA paper by @SVNieuwerburgh argues that AI buildout will cost $10.3T over next 8 years. Furthermore, to get a 10% return on this, those investing will need annual revenues of $3.7T by 2032! (Approx 9% of GDP!)
brookings.edu/wp-content/upl…
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David Doney retweeted
This is a very good and clear writeup on datacenter finance. Can someone explain to me in an EMH-compatible way why it’s worth $META paying *more* in interest just in order to nominally remain an “asset-light” business?
New BPEA paper by @SVNieuwerburgh argues that AI buildout will cost $10.3T over next 8 years. Furthermore, to get a 10% return on this, those investing will need annual revenues of $3.7T by 2032! (Approx 9% of GDP!)
brookings.edu/wp-content/upl…
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Random thought. It was luck that the companies best suited to building out AI happened to be immensely profitable quasimonopolists. They could finance the first leg of the buildout internally without having to meet external ROIC tests. Though they are now issuing debt, that debt is backed by the hyperscalers' non-AI cash flows, not the AI itself. In other words, the AI capex boom has been possible because the technology has never had to prove its profitability. That wasn't the case with the TMT or other prior booms, which went bust when the capex ran too far ahead of the prospective profits.
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David Doney retweeted
The new Census data are here: census.gov/library/publicati…
This one is probably my favorite:
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David Doney retweeted
CBO just released its latest "Distribution of Household Income" report (for year 2023), and the findings are - as usual - a narrative violation.
Real incomes up across the board.
Income inequality basically flat for decades.
Taxes falling for everyone except the rich.
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David Doney retweeted
I have an idea how to fix the inflation problem.
Rising share of HH net transferring money from securities account to pay for daily expenses in recent years, particularly at the top end. All ages, not just boomers. Clear example of the dissaving driven economy.
jpmorganchase.com/institute/…
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Fixing a label here; 2023 share not 2019. If middle-class households had the 16.4% share of 1979 in 2023, income would have been $10,524 higher.
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David Doney retweeted
Some info on the off-balance sheet arrangements; AI estimate of the true D/E with off-balance sheet amounts included are about 2-3x as high. 6/END
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Deja Vu. I recall the same argument to @BIllAckman's here being made in 1999: as the Fed raised rates, Silicon Valley claimed it would have no effect because dot-coms didn't borrow. As that episode showed, raise rates enough & you can deflate any investment boom and bring inflation down.
The presumption that the Fed raising short-term rates reduces inflation is predicated on the belief that higher rates reduce demand and investment.
But what if higher rates don’t reduce demand and investment because the demand for intelligence and energy is unaffected by higher rates because winning the race for super intelligence has a near infinite ROI and the demand for compute will remain incalculable.
Why won’t higher rates at this unique moment in history therefore lead to more inflation as interest costs are embedded in everything?
And the problem is compounded as the more the Fed raises rates, the more inflation we will have and the more the Fed will need to raise rates further and so on.
But what if the old models don’t apply to the current paradigm and the Fed is wrong?
I think the Fed might have just made a mistake. Am I right or am I wrong?
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