Elon Musk’s response to the impending AI bubble burst is of great interest, particularly given the current landscape of AI companies heavily relying on debt and equity financing for their unprofitable operations. Unlike many AI firms, Musk’s Tesla finances its AI development through sales revenue, positioning it to endure the impending financial crisis. The article posits that the AI bubble, akin to the dot-com crash, may lead to a massive decline in AI stock values and a global debt crisis, as over $1.2 trillion in AAA-rated bonds tied to AI financing are at risk of default. This scenario could severely restrict capital availability, making it difficult for companies to raise funds. Therefore, while Musk appears strategically poised to thrive amid potential market upheaval, the uncertainties of these assumptions indicate that navigating this volatile landscape could defy expectations. The article highlights the contrasting principles of sustainable financial management within Tesla compared to its AI peers.
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