Nvidia, OpenAI, and Microsoft—these tech giants are playing a game of 'circular financing' with money just moving from one hand to the other! Billions in capital expenditures to buy chips may look like prosperity, but behind the scenes, it’s all about off-balance-sheet shell companies and fake debt. Chris Bloomstran, President and Chief Investment Officer of Semper Augustus Investment Management, pointed out: The trillion-dollar AI investment frenzy, driven by cloud giants like Microsoft and Google (Hyperscalers), chipmaker Nvidia, and generative AI leader OpenAI, is built on a shaky foundation of high depreciation barriers and a systemic risk black hole of circular financing. According to industry financial tracking disclosed by Bloomstran, there’s currently about $650 billion in off-balance-sheet Special Purpose Vehicle (SPV) debt in the market. These hidden debts are jointly created by tech giants and private equity capital, specifically to provide leveraged financing for purchasing Nvidia’s expensive GPUs (graphics processing units). In this financial structure, the giants pledge the chips they purchase to these off-balance-sheet SPVs, extracting cash again through asset securitization or leveraged credit. This allows them to perfectly hide massive debts from their public financial statements, maintaining the myth of high stock valuations and profit margins. Even more destructive is the 'junk restructuring-style' circular distribution chain between Nvidia, OpenAI, and the cloud giants. The business moves are crystal clear: Microsoft and Nvidia inject tens of billions of dollars in funding or compute credits into OpenAI. OpenAI then immediately uses these funds to purchase Nvidia’s latest-generation chips or pay Microsoft huge fees for cloud infrastructure services. Meanwhile, Microsoft and Nvidia recognize these expenditures from OpenAI as their own revenue and profit growth. This closed-loop recycling of funds among the three directly leads to a severe overstatement of actual revenues for all these companies.