HN user
I find it easy to envision a world, maybe 50 years from now, in which the very concept of "truth in advertising" is viewed as a lost, idyllic fantasy.
There hasn't been "truth in advertising" for many, many years. The only thing that has changed recently is that you don't even have to hide most of the lies.
You're ignoring how much money and power is found in the drug enforcement industrial complex. The point of drug enforcement is not to stop the drug trade.
Hilarious coming from a guy who whined that he wouldn't get a $30,000 raise because he clicked a button.
https://ludic.mataroa.blog/blog/i-accidentally-saved-half-a-...
Never a good sign when a "consulting" company has time to play petulant child.
The point isn't that this stuff happens. It's that a person who is trying to sell consulting services with ranty "this industry is a sham" and "it's a disgrace that it was even possible" blog posts has a website with just 5 major navigation links...and one of them is 404.
The prominent "Business Owners" link on this company's website is broken. "Not Found".
Perhaps this will get downvoted but I personally take with a grain of salt anything written/stated by a company that can't even get the most basic functions (like running a simple website) correct.
And the even bigger irony here is that the author has a ranty blog post in which he claims he saved his employer $500,000 by clicking a button. "[It] is fucking wild that an inefficiency that took me five minutes to solve in a GUI configuration panel was allowed to persist," he wrote.
https://ludic.mataroa.blog/blog/i-accidentally-saved-half-a-...
You're right that the point of regulation isn't to turn a "profit" but the laws of economics always apply. If you have a fine of $100 for a widespread practice that costs $1,000 to collect, the state isn't going to magically allocate resource to applying it.
You could create a private right of action for this, but that is its own bag of worms.
If the latter, just penalize the listing agents. Trivial.
It's very unlikely to be trivial though because the state typically lacks the resources required to enforce things like this at scale. You'll need to find violators, meet a burden of proof that they violated the law, notify them, give them the right to defend themsleves against the allegation, etc.
They'll almost certainly spend more time and money on the process than is ever collected if this ever happens.
What incentive does the platform have to do this? Ostensibly, the agents/landlords are the ones who pay, so you're asking the platform to bite the hands that feed it.
It's strange to see this on the site:
While I may use AI for work, my website, and all the content on it, is entirely written by hand.
I mean, if you're tired of the slop and what AI is doing to the industry, why do you need to use it for a simple personal website?
Prayer, as in "pray you don't get sick".
Much of the content on social media is "advertising" of some form, even when the "creators" aren't paying to boost it. Someone is trying to sell you something/"influence" you.
Facebook benefits directly and indirectly from all the "creators" who think its platforms are critical distribution channels for their crap "content".
I won't dismiss that technology can be great for keeping in touch with people (especially family) who are not physically close to you but we should also acknowledge that there's a huge difference between digital interactions and face-to-face connection. There is a compelling body of evidence that the latter provides far more emotional and mental health benefits than the former.
Anyone truly interested in their well-being should make sure they're not treating digital interactions as a 1:1 substitute for real-life connection.
Going the YC founder route is a much faster and more efficient way to secure a high tier than climbing the SWE ladder.
YC has funded over 5,000 companies. If you assume 2-3 co-founders per company, that's more than 10,000 to 15,000 people. The vast majority of these founders aren't producing "generational wealth" outcomes. There's no glamorization of the companies that shut down, the ones that are scraping by, and the ones that get their founders a normal job, but those are the far more likely outcomes, especially in the more recent spray-and-pray batches.
...but because the implementation is as obviously corrupt as the business owners pushing it.
Because the business owners figured out that they could get you to pay for things that turn you into an even more valuable product.
The cat is out of the bag and there is no reason to believe there will ever be a reversal of this. Not enough people care, and there isn't enough demand for "clean" products to displace the big companies. People aren't going to pay $1,000 for a privacy-respecting version of a product that's available for $200.
As I see it, the only solution (if you really want one) is to reject the idea that every aspect of your life has to be tech-ified. To say no to digital crack because you recognize it's rotting your brain, harming your relationships, etc.
You don't need to stare at a screen 15 hours a day for work, education, information and entertainment. You don't need your watch, television, speakers, glasses, fridge and toilet to be connected to the internet. You don't need a smart phone or watch or pair of glasses to be the "load-bearing" foundation of your relationships with friends, family and community.
Not to watch the social feeds but to find my way or read a message from a friend saying they're late.
Do you really need this for that?
What if I could watch Instagram reels at all moments all day. Streamed right in to my eyeballs.
You'd be Mark Zuckerberg's idea of an ideal person.
I think the definition of an accounting loophole is something that is technically legal but nonetheless suspect because it lets you appear to get something for nothing.
But you haven't even articulated what the loophole here is.
According to your best-case scenario, Nvidia helps CoreWeave get a loan it would otherwise not get by guaranteeing revenue for CoreWeave; this allows CoreWeave to borrow money and give it to Nvidia as revenue; bulls point to Nvidia's revenue as a reason to ignore obligations like the CoreWeave guarantee, because after all, just look at all that revenue!
Nvidia's guarantee is almost certainly a consideration for CoreWeave lenders that could lead them to provide financing on more favorable terms than they would if there was no guarantee. However:
1. Building out capacity for CoreWeave isn't just about buying chips. It has to build datacenters, pay for electricity, etc. The amount of debt raised ($35 billion+) far exceeds what it has paid Nvidia so lenders are nowhere close to having a make-whole guarantee from Nvidia here.
2. The backstop is subject to termination if certain events occur, and these events are far more likely to be triggered if CoreWeave comes under financial distress, which is when it would need the backstop the most.
It's not that there are no risks here; it's that you haven't actually articulated in legitimate terms what they are and you haven't quantified anything.
You keep saying this. That is not what the article says. It says the backstop is currently valued at $6.3B. That is not the cap.
We don't know what the maximum is because some of the terms are confidential. But if you're going to talk about this agreement so confidently, you should read the actual MSA:
https://www.sec.gov/Archives/edgar/data/1769628/000114036125...
The irony of this is that there are a number of scenarios under which Nvidia can legally terminate the agreement and most of them are precisely the kind of scenarios that would exist if CoreWeave came under significant financial distress. So contractually, the backstop isn't ironclad at all and worth far less to CoreWeave as you seem to believe.
Please, if you're going to make hyberbolic claims about what's going on, at least take the time to read what has been filed with the SEC. The picture is not as black and white as you make it.
No one is saying Nvidia was spending a dollar for every dollar. It doesn't have to in order for the demand to be manufactured.
So have you quantified how much money Nvidia has to spend to generate a dollar of artificial demand?
If you're going to imply that CoreWeave was induced to take on tens of billions of dollars of debt to buy chips so it could have more compute capacity than it actually believes it needs with a $6.3 billion backstop that could disappear if it came under financial distress, please walk through the math.
So answer me this: if I take a GPU order from an insolvent individual for $100M, can I book that $100M as revenue and be GAAP-compliant? Is it real?
No, under ASC 606 you cannot recognize revenue unless it's "probable" that you'll collect substantially all of the consideration due. And revenue would not be recognized until title to the assets being sold was actually transferred; a purchase order with nothing shipped is a backlog.
Before you ask these questions, why don't you do some research? These are not complicated accounting questions.
What if I don't know that they're insolvent?
CoreWeave is publicly traded. Feel free to evaluate the financials and explain how the company is insolvent.
Stockholder equity is positive to the tune of nearly $5 billion, so its assets exceed its liabilities. And it generated nearly $3 billion in net cash in Q1 and is currently servicing its debt obligations. It even added an $8.5 billion non-recourse debt facility and was upgraded to positive from stable by S&P.
You don't get those types of debt facilities and S&P upgrades if you're insolvent. And ironically, insolvency is one of the potential triggers for the Nvidia backstop to go away.
A smarter discussion would be around CoreWeave's leverage and what happens if the AI demand dries up. That would be infinitely more useful than trying to make arguments that you haven't even researched.
What if I guarantee them ROI of $10M/year on their purchase so they can get a loan and pay me the cash?
You haven't actually demonstrated that Nvidia has guaranteed CoreWeave a positive return on its investment. Once again, the $6.3 billion backstop is nowhere near the amount of money CoreWeave has spent building out capacity, which is tens of billions of dollars.
If you knew how the modern music industry and local diners work, you might not be so impressed.
It's not all artisanal, made with love goodness just because human hands did it.
Perhaps you underestimated the person you went to high school with? The fact he or she "could barely figure out how to set up a Drupal site a few years ago" doesn't mean much. Lots of people are capable of immense progress when they apply themselves.
Nvidia is essentially guaranteeing CoreWeaves return on the chip investment.
You cannot say that Nvidia is guaranteeing a return on investment for CoreWeave without showing the actual math for a positive ROI.
CoreWeave has over $35 billion in debt, most of which has been used to build out datacenters. Nvidia's backstop is capped at $6.3 billion, and only through 2032.
You need a new theory here.
Saying the revenue is real, and that there are "gobs" of it, doesn't make it so.
I'm really sorry, but with all due respect, this is getting into sillyland. Q1 2027 revenue of $81.6 billion is not a made up number. The $58.2 billion in net earnings is not a made up number. The $20 billion Nvidia returned to shareholders via share repurchases and dividends is not a made up number. The $80 billion the company added to its share repurchase program is not a made up number. The $50+ billion in cash and short-term investments on the balance sheet is not a made up number.
If every dollar in was being used to drive a dollar of new demand, Nvidia's financials could not look like this.
Now is there circularity in the AI market? Yes. Are there legitimate reasons to pay attention to it and be concerned? I think "yes" is a reasonable answer. But you cannot claim this is all "fake" and expect people to take you seriously because none of the financials supports it.
But I ended up not doing so, because your co-founder and the people you hire will end up being more aligned to you (your values, judgements, whatever) than even the market you end up in, especially early on.
Your article comes off as very confident about the way things are, and your comment does too, but your perspective doesn't match what I've seen in over 30 years in this industry, which is that tons of companies are started by founders and early employees who compliment each other and fill in each other's gaps.
all real but unnamed examples
Real Buddhist monks typically don't use mind-altering substances (it's a violation of the Fifth Precept), but in any case, following on my point above, your "unnamed examples" read like caricatures. Great for trying to make your blog post convincing; not great for building arguments that align to what's typical in the real world.
Yeah, isn't there an AI for that?
Whether CoreWeave actually bought chips it doesn't need is speculative; whether they are incentivized to do so is not. That is clearly the case: if you are guaranteed that any excess capacity will be bought, a rational actor will buy more than they need, as there is no risk for over-buying, but there is risk in being caught short. That isn't cynical, it's simple econ 101.
There's a problem here: you haven't actually quantified how much CoreWeave is spending versus the value of the backstop. You seem to be suggesting that for every dollar CoreWeave spends on Nvidia chips, it's getting a dollar in backstop. But that's not how it works.
CoreWeave buys chips from Nvidia; Nvidia has agreed to buy up to $6.3 billion in unused compute capacity through 2032. It's not buying back the chips, etc.
CoreWeave has raised way more debt (over $35 billion) to build out compute than what Nvidia has backstopped (up to $6.3 billion). In other words, CoreWeave is spending a ton to buy chips, build datacenters, buy electricity, etc. and Nvidia's backstop, while important, doesn't come close to backstopping all the investment CoreWeave is making to acquire its compute capacity.
If demand for compute dries up, CoreWeave and its lenders are going to be on the hook for way, way more than Nvidia is.
As noted earlier, the $6.3B is a floor, not a ceiling.
You keep repeating this but it's factually incorrect. The $6.3 billion is the maximum.
https://finance.yahoo.com/news/coreweaves-6-3-billion-backst...
As I've noted, $6.3 billion works out to a few days' revenue for Nvidia.
Maybe. But the whole point of this discussion is trying to answer the question, "How much of Nvidia's revenue is real?"
This is such a strange question.
Nvidia reported revenue of ~$215 billion for FY 2026, and ~$96 billion in free cash flow.
I don't know how to put it more simply: this is real money. And gobs of it. It's not made up.
The question you seem to really be asking is: is the demand for chips that is driving this revenue sustainable, or will it collapse, leading to a massive rapid drop in revenue? That's a completely different question but just FYI: Nvidia reported $81.6 billion in Q1 FY 2027 revenue so...
There are way too many straw man examples in this article that it distracts from the point the author is trying to make.
A former jazz pianist and Buddhist monk who used psychedelics, the Spanish-speaker trying to sell into a Chinese-speaking market, the introvert selling to enterprise buyers who love going to steakhouses and watching the Yankees from box seats, etc.
Interestingly, two words that aren't mentioned even once in this entire article: "co-founder" and "hire". Very few people singlehandedly build the type of businesses the author is talking about. They team up with and recruit other people to join them so that they can focus on what they do best and fill in the gaps with other people's talent.
I think the main question about Corgi is: are they underpricing risk so severely that they go bust? And honestly, we have no idea.
You should read up on what a risk retention group is and how it works. To me, it's even worse than you think.
For all we know startups are buying overpriced insurance from Corgi because they have a better brand...
Is this tongue in cheek?
...and are easier to deal with than Berkshire's army of underwriters.
Or they provide "insurance" for things that the world's most experienced insurers don't want to touch, or won't touch without a lot of underwriting. Which in itself is a red flag.
...the arrangement incentivizes Coreweave to buy chips it doesn't need
You state this as fact but this is just cynical speculation on your part.
The less cynically speculative analysis is that Neoclouds like CoreWeave are rushing to build datacenters because their whole business is based on the premise that AI is a revolutionary technology and there will be massive durable demand for AI compute for the forseeable future.
CoreWeave generated over $2 billion in revenue in Q1 and has a nearly $100 billion contracted revenue backlog. This is not an imaginary business with no demand.
Nvidia has invested a very modest amount of money in CoreWeave equity. Dividing its revenue by the number of days in a year, Nvidia generates about $2 billion in revenue in ~3 days, and $2 billion represents 0.04% of Nvidia's market capitalization.
Are there risks here? Yes. Is the circularity potentially problematic? Yes. But is it also true that some of these arrangements are being used to make hyperbolically apocalyptic claims? Yes.
You're assuming that Nvidia will have some business need for the excess capacity, but there's absolutely no assurance that that is the case...
You're absolutely correct here, which is a source of risk for Nvidia. That doesn't change the accounting as far as GAAP is concerned though, and you aren't looking at the big picture.
The $6.3 billion backstop through 2032 is not a huge burden at all for Nvidia. Nvidia will generate about $190 billion in free cash flow this year alone.
I think they are exploiting an accounting loophole...
With all due respect, you haven't articulated what that accounting loophole is. I've explained why the examples/comparisons you've made aren't equivalent according to GAAP.
From everything I've read and seen disclosed, CoreWeave pays full price for its Nvidia chips. Nvidia is not financing the sale. CoreWeave has taken on large amounts of debt financing from unrelated third parties. It's highly like that the Nvidia backstop helped CoreWeave get better financing terms, but Nvidia isn't actually providing the financing.
If CoreWeave is paying cash and taking title to the asset, and Nvidia has no obligation or right to take the asset back, it is GAAP 101 that the transaction would be booked as a sale because...that's what it is.
To summarise my opinion, subjectively it seems like a better distinction could be made in GAAP to look through this agreement and others like it.
There's two things here: accounting and disclosure.
The accounting, which is what GAAP deals with, really doesn't seem problematic. CoreWeave is giving Nvidia cash for the chips and taking title to them. There's no associated repurchase right or obligation. So treating this as a sale and booking the revenue is the most sensible accounting approach. Trying to make it into something it's clearly not because it makes some people feel better isn't sensible.
I think the more important discussion is around disclosure: how much information Nvidia should be required to provide about its relationships with companies like CoreWeave, and where and when. Right now, we have to paint the picture based on multiple disclosures. We know about the equity stake through a 13F. The backstop was in an 8-K that was filed two years after the agreement was signed. The equity stake is not high enough that most of the rules around "related party" disclosures come into play.
I suppose you could make the argument that the market obviously sees the circularity here despite the patchwork disclosures that apply, so the circularity is ostensibly being priced in to the stock prices, debt, etc. But there's a legitimate argument that the market would be better served if disclosure was earlier and cleaner.
Even so, none of this would prevent Nvidia from engaging in these types of transactions because there's nothing inherently illegal about them.