The Trillion-Dollar Circle: Everyone Is Buying Everything From Everyone
OpenAI commits to Oracle. Oracle buys Nvidia. Nvidia invests in OpenAI. At some point this is either the greatest infrastructure buildout in history or a very expensive group hug.
Trace the money in the AI buildout and you keep arriving back where you started. Nvidia invests in OpenAI, which commits hundreds of billions to compute from Oracle and others, who spend it on Nvidia chips. The vendors finance the customers who buy from the vendors. Analysts have started using the word circular, which is analyst for we have concerns but the stocks keep going up.
History's verdict on circular capex is genuinely mixed. Vendor financing built the railroads. It also built the 1990s telecom bubble, and only one of those ended with the infrastructure still being worth something. The question is not whether the money is circular, it is whether the end demand at the bottom of the circle is real and durable.
Our position: some of it is real, all of it is levered to sentiment, and the unwind risk lives in the gap between those two facts. We wrote this in December 2025. July 2026 readers may now nod slowly.