Comment by 578_Observer
8 hours ago
The "Railway Bubble" analogy is spot on.
As a loan officer in Japan who remembers the 1989 bubble, I see the same pattern. In the traditional "Shinise" world I work with, Cash is Oxygen. You hoard it to survive the inevitable crash. For OpenAI, Cash is Rocket Fuel. They are burning it all to reach "escape velocity" (AGI) before gravity kicks in.
In 1989, we also bet that land prices would outrun gravity forever. But usually, Physics (and Debt) wins in the end. When the railway bubble bursts, only those with "Oxygen" will survive.
I‘m aware this means leaving the original topic of this thread, but would you mind giving us a rundown of this whole Japan 1989 thing? I would love to read a first-person account.
I am honored to receive a question from a fellow "Craftsman" (I assume from your name).
To be honest, in 1989, I was just a child. I didn't drink the champagne. But as a banker today, I am the one cleaning up the broken glass. So I can tell you about 1989 from the perspective of a "Survivor's Loan Officer."
I see two realities every day.
One is the "Zombie" companies. Many SMEs here still list Golf Club Memberships on their books at 1989 prices. Today, they are worth maybe 1/20th of that value. Technically, these companies are insolvent, but they keep the "Ghost of 1989" on the books, hoping to one day write it off as a tax loss. It is a lie that has lasted 30 years.
But the real estate is even worse. I often visit apartment buildings built during the bubble. They are decaying, and tenants have fled to newer, modern buildings. The owner cannot sell the land because demolition costs hundreds of thousands of dollars—more than the land is worth.
The owner is now 70 years old. His family has drifted apart. He lives alone in one of the empty units, acting as the caretaker of his own ruin.
The bubble isn't just a graph in a history book. It is an old man trapped in a concrete box he built with "easy money." That is why I fear the "Cash Burn" of AI. When the fuel runs out, the wreckage doesn't just disappear. Someone has to live in it.
I nominate Sam Altman to be that Someone.
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> Cash is Oxygen. You hoard it to survive the inevitable crash. For OpenAI, Cash is Rocket Fuel. They are burning it all to reach "escape velocity" (AGI) before gravity kicks in.
For OpenAI, cash is oxygen too; they're burning it all to reach escape velocity. They could use it to weather the upcoming storm, but I don't think they will.
Exactly. They have chosen to burn the lifeboats to power the engine.
It is a magnificent gamble. If they reach escape velocity (AGI), they own the future. But if they run out of fuel mid-air, gravity is unforgiving.
As a loan officer, I prefer businesses that don't need to leave the atmosphere to survive.