Nvidia & The AI Gold Rush (Or, My Cousin’s Server Farm)

It started, as these things often do, with my cousin Dale. Dale, who once tried to breed miniature horses in a converted garage, is now convinced artificial intelligence is the future. Not in a thoughtful, academic way, mind you. More in the way a squirrel believes acorns are a comprehensive retirement plan. He’s sunk everything—and I mean everything—into building a server farm in his basement. It’s a low-ceilinged, perpetually damp space, and the constant whirring is audible three houses down. He keeps calling me, breathless, about “hash rates” and “GPU optimization,” as if I have any idea what he’s talking about. I mostly nod and murmur supportive noises, hoping he won’t ask me to invest.

Anyway, Dale’s little operation, and the countless others like it sprouting up everywhere, is why I’ve been watching Nvidia (NVDA +2.50%). It’s not that I’m suddenly interested in basement-based tech empires, but the numbers are hard to ignore. The company’s recent earnings report—$57 billion in sales, a 62% jump—felt less like a financial statement and more like a declaration of independence from, well, reality. Jensen Huang, the CEO, talks about a “virtuous cycle of AI,” which sounds suspiciously like a polite way of saying “we’re printing money.” He claims their Blackwell processors are “off the charts,” and frankly, I believe him. I’ve seen the charts. And I’ve seen Dale’s electric bill.

Nvidia controls about 90% of the GPU market, which feels…unhealthy. Like a monopoly disguised as innovation. But then again, who am I to judge? I once spent three hours trying to return a defective toaster oven. The market will sort itself out, or it won’t. I’m more concerned with the fact that everyone—Alphabet, Microsoft, Meta, Amazon—is throwing money at data centers like there’s no tomorrow. They collectively spent $380 billion last year. It’s enough to make a sensible person weep. Alphabet alone plans to double their capital expenditures, potentially reaching $185 billion. Meta’s not far behind. Even Tesla is getting in on the action, allocating $20 billion to AI infrastructure. It’s a feeding frenzy.

Nvidia’s management estimates that by 2030, global spending on AI infrastructure will be between $3 trillion and $4 trillion. That’s…a lot of servers. A lot of electricity. A lot of slightly damp basements. And a lot of opportunity, if you’re willing to ignore the nagging feeling that we’re all building a very elaborate digital Jenga tower. I’m not saying Nvidia is a sure thing—nothing ever is. But it’s certainly benefiting from the current mania. And frankly, I’m starting to think I should have invested in Dale’s operation. At least then I’d get a discount on whatever AI-powered miniature horse grooming service he inevitably launches.

The whole thing feels precarious, of course. Like a bubble waiting to burst. But as a trader, I’ve learned that bubbles don’t burst on schedule. They tend to float around for a while, inflating and deflating, until everyone decides, collectively, that enough is enough. Until then, Nvidia looks poised to keep riding the wave. And Dale? He’s already talking about expanding into the garage next door. I’m starting to think I need a new cousin.

2026-02-10 03:32

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