Comment by shoo

A historical episode that may arguably be related -- regarding stock market euphoria & overbuilding capacity -- was the dot-com era Telecom bubble & crash [1].

Even if something is a reasonable infrastructure project with a sound long term business plan, investors can still lose money if they pay too much for it. For the Telco bubble & crash, there were a few of these Telco companies engaging in financial shenanigans / securities fraud to juice their quarterly financials by leasing capacity to artificially inflate their operating revenue etc. E.g. we booked $100m of revenue by leasing X units of our capacity to $competitor! Sure, we're still extremely cashflow negative, but look at our operating revenue grow! Fine print: we also incurred a symmetric $100m expense to lease X units of capacity back from the same $competitor, but for some reason we didn't classify that as an operating expense, we've thrown it into a different accounting bucket.

That said, overbuilding fiber optic capacity by laying undersea cables is likely different to overbuilding GPU datacenter capacity in that most of the cost of laying a cable is the physical cost to lay the cable -- given you're already laying an undersea cable, the incremental cost to add a bit more capacity to it (more optical fibers) is negligible -- at least before you've sunk the cable! Whereas for a data center full of GPUs, maybe 50%-60% of the total cost is the GPUs, so it isn't cheap to massively overbuild capacity.

[1] https://en.wikipedia.org/wiki/Telecoms_crash