What Louis C.K. would think about Nvidia's Circular Financing

Wrong Questions

SubscribeSign in

What Louis C.K. would think about Nvidia's Circular Financing<br>A Louis CK-style bit: “The Money Merry-Go-Round”<br>Aug 11, 2026

Share

You ever notice how no one in the world has money anymore, except for these companies? And these companies don’t even have money. They have... promises of money. Like, they all found a way to pay each other with the same dollar. The same dollar, just going around in a circle, like a dog chasing its own tail, but the dog is worth four trillion dollars.<br>Let me explain it to you, because I’m not a smart man. I buy my pants at a place where they yell at you. But even I can see what’s happening here. There’s this company, Nvidia. They make these little chips, and these chips are like... crack. For computers. Every company on Earth is like, “I NEED the chips. I will sell my grandmother’s teeth for the chips.”<br>So Nvidia’s got the chips. Good for them. They’re rich. But here’s the problem: the people who want the chips — the AI companies — they’re all broke. They’re not profitable. They lose money the way I lose socks. It’s just constant, endless, tragic losing. So Nvidia says, “No problem! We’ll give you the money to buy our chips. With interest! Plus we’ll also invest in your company! And then you’ll take that money, and you’ll buy our chips! And then we’ll take the money from the chips and invest it in more companies that buy more chips!”<br>And everybody in the room nods, and they shake hands, and they say “synergy,” which is a word that means “nobody’s really sure what the other person is doing but we’re all getting paid.”<br>And they say it’s NOT circular. This is the part that kills me. Because Jensen Huang — the CEO, who looks like he got dressed in the dark at a motorcycle convention — he stands up in his little leather jacket, and he says, “The idea that this is circular financing is ridiculous.”<br>RIDICULOUS. I said “ridiculous” once to my daughter about her haircut, and I’m still in therapy. He says it about a circle. A literal circle. Here’s what they announced — I read about it, I’m not proud of it, I was on the toilet — they got six of the biggest money firms in the world. Apollo. BlackRock. Blackstone. Brookfield. Goldman Sachs. KKR. And they’re gonna “mobilize” over five hundred billion dollars. Five hundred. Billion. To finance these data centers.<br>Now, a data center is a building full of computers. That’s it. That’s the whole thing. It’s a warehouse with a million laptops taped together, and they put a tin roof on it and call it an “AI factory,” like it’s making cars. It’s not making cars. It’s making the same three paragraphs over and over until you ask it to stop.<br>But here’s the beauty part. The money firms are gonna lend money to the AI companies. The AI companies are gonna use that money to buy chips. From Nvidia. And Nvidia is gonna pay the money firms back a little bit. With interest. And the interest comes from... the money the money firms gave them. It’s a perfect circle. It’s beautiful. I saw a circle like that once — it was a flushing toilet, and I was throwing up in it, because I’d had a bad day.<br>And when they asked him about it, Jensen says — and I love this — he says the money firms “independently underwrite each project.” Independently! Like a bunch of guys standing around a table who all went to the same cocktail party where Nvidia gave them the same PowerPoint. Independent. Sure. My kids do their homework “independently,” which means they sit next to each other and one of them does it.<br>But wait, it gets better. Because if the money firms get nervous — if they start to smell the coffee, you know? — Nvidia says, “No problem, we’ll backstop up to 25% of the deals.”<br>Backstop. That’s a word. That’s a great word. It means: “If the whole thing falls apart, we will catch it.” With a dollar. A dollar that we printed by selling chips to the people who are falling.<br>It’s like if a guy loans you money so you can buy his car, and then you use the car as collateral for a loan from his cousin, and then you pay him back with the cousin’s money, and the car is still his, and everybody’s happy, and nobody has a car.<br>And the neoclouds! Oh my god, the neoclouds. I can’t even — there are these companies now called “neoclouds.” They’re clouds that are newer than other clouds. Clouds, from a company that was a search engine. And these neoclouds — CoreWeave, Nebius, Lambda — they buy chips from Nvidia. But they don’t have money, because they’re “clouds,” which is not a real business, that’s a weather thing. So they take out loans. And what do they put up as collateral? THE CHIPS. They borrow money to buy the chips, and the chips back the loan. The product is the collateral for the money that buys the product. I asked my accountant about this and he said “don’t worry about it” and then he started sweating.<br>And Nvidia doesn’t just sell them the chips. Nvidia invests in them. Nvidia owns a...