ROUND AND ROUND IT GOES: Who’s paying whom? The circular money machine behind the AI boom (or bubble).

A chip supplier invests in a customer such as a data center builder, the customer spends the money on the supplier’s chips, and both companies report growth.

One central bank analysis found that 55.2% of investments in AI firms came from other AI firms.

What’s not clear to investors or the market is how much of this AI boom is being driven by real, end-user demand—and how much might be a bubble.

Take Nvidia. The world’s leading chipmaker is investing in ChatGPT owner OpenAI to support data centers filled with Nvidia chips.

Nvidia will invest US$30 billion in a private funding round for OpenAI and provide a guarantee of up to US$105 billion for an OpenAI data center in Ohio. It will also invest in the company building it.

That helps OpenAI remain Nvidia’s best customer, but it also raises the question: Is the chipmaker propping up the market?

I read a couple of extremely sharp business analysts who believe we might not be in a bubble, and others just waiting for it to pop — so I have no idea. But I do know it’s probably not a good idea to get so deep into bed with OpenAI’s Sam Altman.