Episode summary
Bloomberg Businessweek Daily: Blackstone Chips Bet (Podcast)
Bloomberg Businessweek Daily
· · Hosts: Carol Massar, Tim Stenovec · Guests: Dina Bass, Jay Chaudhry, Ray Madoff, Jessica Dupuy
Summary
Blackstone’s 2023 CoreWeave financing is used as the entry point to a bigger story about how AI infrastructure is changing credit markets. A Bloomberg News reporter argues that chip financing through SPVs has grown from almost nothing a few years ago into a market that could reach $1 trillion, because hyperscalers can fund the buildout with balance-sheet strength while newer AI companies like OpenAI and Anthropic need outside capital to pay for GPUs and data-center capacity. The discussion also notes that the chips are expensive, capacity is tight, and the economics still depend on whether AI users can sell profitable services on top of the hardware.
The program then turns to cybersecurity, where the CEO of Zscaler says the threat environment is worsening as more business moves online and AI increases the scale of attacks. He argues that patching alone is not enough and that enterprises need a zero-trust, cloud-based approach that hides applications and limits contagion across connected systems. He says consumers have limited tools, while banks and retailers need stronger guardrails built into the services they provide.
A law professor then argues that the U.S. tax system is tilted toward wealth, not wages: high earners pay income tax, but wealthy investors can avoid tax by holding assets, borrowing against them, and passing gains through inheritance. The final segment shifts to Italian wine, where a writer and co-author describes the category as culturally rich, diverse, and increasingly accessible, with Prosecco and Valpolicella positioned as easy-drinking examples.
Key takeaways
- The Bloomberg News reporter says chip-financing SPVs have grown from nearly nothing to a market that could reach $1 trillion.
- The reporter says AI demand is strong, but the core risk is whether companies can make the services built on chips profitable.
- Jay Chaudhry says cybersecurity threats are broadening and deepening, so patching alone is no longer sufficient.
- Chaudhry argues enterprises need zero trust and cloud-based protection because attackers can move through connected systems after one breach.
- Ray Madoff argues the wealthy often avoid taxes through capital gains and inheritance, while wage earners bear most of the burden.
- Madoff says the U.S. should bring investments and inheritances into the income tax system rather than rely on the estate tax.
Notable quotes
“the industry that's kind of grown up around, you know, chip financing through spvs, uh, that, you know, four years ago pretty much didn't exist”
“There was, you know, one deal, uh, done for core. We by Blackstone back in, you know, 2023 and at 2 billion now that, uh, market is tracking towards 1 trillion”
“To fend off these new threats, you need to look at a different approach. And that's what Zscaler is excited about”
“the rich pay the bulk of taxes as well versus income? It's an important distinction”
“we need to bring investments and inheritances into the tax system”
How the episode opens
This is Bloomberg Businessweek daily reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy, plus global business, finance and tech news as it happens. The Bloomberg Businessweek daily podcast with Carol Massar and Tim Stanback. Uh, our next reporter has been looking into a Blackstone bet on chips that is driving a debt boom that is upending credit.
And then another story. It's a Bloomberg Quicktake today, Jane Street and rivals now fighting for air power as they compete for an edge in the I era. So let's get to it with Dana Bass.
Uh, she is I infrastructure reporter at Bloomberg News, joining us from Seattle. So much to get to with you, Dana. Um, tech and high finance.
The intersection of such a lot going on. Blackstone really doubling down. Um, tell us a little bit about, uh, your story when it comes to their bet on chips.
Sure. And it's not just black stone. It's black stone and Apollo.
Pretty much all of the, uh, you know, US based investors, alternative asset managers. And it's fascinating that you bring up the railroads because the I build out, a lot of people will look back to the railroads. Is it a, you know, an effective analog?
There aren't that many analogs. And that's kind of why we're here. What's going on is that, you know, for the longest time we've been talking about cloud for more than a decade.
But what was going on was the the large investment grade hyperscalers, Amazon, Microsoft, Google, they were basically paying for this build out. And for these chips, either with their own cash or their investment grade, so they can borrow on their own balance sheet. Now that we have this massive build out that also involves neo clouds, uh, you know, either who either don't have investment, uh, you know, don't have credit ratings or aren't investment grade.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- chip-backed debt
- ai infrastructure expansion
- private credit
- credit markets
- data centers
Companies and tickers mentioned
- BX
- ZS
- Blackstone
- CoreWeave
- Zscaler
Watch the episode
Watch “Bloomberg Businessweek Daily: Blackstone Chips Bet (Podcast)” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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