Railroads CAPEX ran 6% of US GDP ... wave after wave of bond defaults. Telecom, just $1T... also everyone went bankrupt... AI data centers? ... does history repeat... that is the question.

Texas Railroad Commission candidate Bo French refused to take down an anti-immigrant post about students celebrating at a University of Texas football game, instead attempting to raise funds off of the publicity. Donations have poured in for his opponent.

Anyone who compares the railroad bubble to AI instantly loses me. (Looking at you CNBC) They are not the same. Not even close. Railroads moved people and physical goods from Point A to Point B. AI produces intelligence. It writes code. Designs products. Discovers drugs. Automates labor. Accelerates research. Optimizes factories. Creates software. And its capabilities continue improving while the cost of intelligence continues falling. “But railroads had massive capex too!” So what? Capital intensity is not an economic model. Railroads were ultimately constrained by miles of track, geography and physical throughput. AI can penetrate virtually every industry on Earth and attack trillions of dollars of human labor and knowledge work. The TAMs are NOT comparable. Railroads revolutionized transportation. AI is attempting to industrialize intelligence itself. Stop pretending those are remotely the same thing. They aren’t.

Two hundred railroads went bankrupt in the 1800s. I don't  think the AI buildout will end the same way. The railroads were built on a hope and a prayer while AI revenues seem to be screaming. Watch my latest In The Know:

Imagine standing on a railroad line in the middle of nowhere at noon. You hear it before you see it. Three riders coming straight down the track at you, and not one of them is slowing down. All on DaVinci. One prompt, three versions. Seedance 2.5 · MiniMax H3 · FLUX 3