September 22, 2025 • 37 mins
Nvidia just announced a $100 billion investment into OpenAI, the company behind ChatGPT. This groundbreaking move could reshape the future of AI, technology, and even how we approach financial planning. Jon Sanchez is joined by Dr. Dennis Sanchez, the AI Doctor, to break down what this massive 10-gigawatt project means for investors, markets, and everyday users.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:05):
Good Monday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty K which it's a
whole pleasure to be with you. Mister Gunt will be
joining us momentarily, but in the meantime we do have
not that it's a substitute by eighty means he's a
man in and of himself. Doctor Dennis Sanchez, the AI
Doctor for our Monday AI session. How you doing, bro?
Speaker 2 (00:22):
I'm doing great.
Speaker 1 (00:23):
How you doing, bro? Fantastic, man, fantastic. Been looking forward
to this all day long. Always nice to get a
chance to see you, talk to you, and definitely further
our education on AI. To say the least.
Speaker 2 (00:37):
I can't believe how far you've come about AI since
we first start thanks to you.
Speaker 1 (00:44):
Yeah, yeah, it's I know, I was just thinking back
on that. It's funny you bring that up. I was
thinking back to that just I think over the weekend,
it's like we're not so much just me, but just
the whole AI industry. Right, it was not long ago
where we're going, what's this thing called chat GPT and
(01:04):
you know, you look where we are now as far
as the industry, and you know the analogy that that
all of us usually give on on Mondays. When we
have you on is our heads are spinning. Things are
going so very very fast. Right, That's that's about it.
I can't imagine for you being in it, in the
thick of it all day every day. Oh my goodness. Well,
i'll tell you what. It is a great, great time
(01:26):
to have doctor Dennis Sanchez on the show today because folks,
we had a major announcement that was announced that came
out this morning. Uh, it was not planned. It was
on CNBC. And who was involved with it. Jensen Wong,
the CEO of Navidio, and Sam Altman of course, the
CEO of open Ai, uh the parent of chat GPT
and many other great things. And what was funny, Dennis,
(01:49):
I think I was telling you about this when seemed
to see their their tech reporter. He started the interview
off by saying, you know, you guys called me here
and I didn't know what you want to talk about,
so you know, yeah, exactly. Then they dropped this one
hundred billion dollar, one hundred billion dollar bomb on everybody,
(02:11):
and my gosh, it was perfect timing for our subject
this afternoon, which is what does Navidia's one hundred billion
dollar investment mean for you, right, that's what we're talking about. Now,
let's go back real quick here, lay out the stage
of what we're going to be discussing. Get the stock
market side going. So again, this was an absolutely surprising
announcement this morning between the two gentlemen. I just mentioned
(02:34):
a one hundred billion dollar investment buy Navidia into open AI. Uh.
This investment is going to be a ten gigawatch project.
Now you may be going, what heck does that mean? Well,
don't worry, We're going to measure power. Yeah, a whole
bunch of powers. I'm going to give you an analogy here,
h a ten gigawatch project, something again, no one has
(02:56):
ever seen before. So our purpose today is to say, look,
what does this mean for you? How are you going
to be using AI in the future. But we're also
going to get some of these terms that we've been
throwing out here. Dennis is going to be explaining these
into layman's terms, and you know, try to make sense
of it, because folks, whether you're investing in AI or
(03:17):
you're using AI in your personal life, your business life,
there's a lot of terms that you may be hearing
and maybe even using, you don't truly understand what they are.
So that's going to be part of our education each
Monday when Dennis is on for the AI segment, is
to really begin to explain what these are so that you,
of course confurther your knowledge. And again that is one
of the many, many reasons that we have a dentis
(03:39):
on each and every Monday. Real quick, before we get
started on the stock marketing side, dentists, what did you
think of this announcement? Were you surprised or were you,
like like the rest of us, like my god, this
is serious money that Navidia is investing.
Speaker 2 (03:51):
Honestly, I'm a little bit numb by it, are you?
Speaker 1 (03:54):
Really?
Speaker 2 (03:55):
It's becoming well, and I look at how it's dominating.
This kind of mission is dominating the news every single day.
And it's a handful of players. It's not like we're
it's a new name every day. You know, it's it's Microsoft,
it's it's Meta Oracle, it's Meta, it's you know, open
(04:15):
AIY is always kind of in the mix there, and
the video seems to be really dominating the conversation, so
it's hard to even understand what one hundred billion dollar
deal is but we're throwing these around fifty billion, one
hundred billion just in the investments in this technology, and
(04:36):
we don't you know, we're sitting out here going, I mean,
I don't even understand that number.
Speaker 1 (04:40):
It's so big.
Speaker 2 (04:40):
But then again, like you said, how is that going
to filter down to us? Because we know it's going
to have ratifications on a lot of different levels, the
stock value, the you know, our lives, and I think
we're here to talk about how it's going to impact
our lives.
Speaker 1 (04:56):
Absolutely, absolutely we are. Yeah, not only I mean and
again when you say impact our lives, it can be
from a lot of different standpoints, whether it's from an
investment standpoint, uh, whether it's from again personal usage, business uses,
et cetera. I think with this announcement today is we're
going to go into more detail here momentarily. This is
again revolutionary, right, this is a this is a company
(05:17):
meaning the video and by no means are we sitting
here recommending the stock or anything. It's just they're they're
at the core heart of all this. You know, this
is on top of the massive announcements they made last
week with you know, significant investments into Oracle and significant
investments into a lot of different things. I mean Intel,
(05:40):
you know, five billion dollar investment last week and do
and do uh into Intel. And again it's just mind
boggling the amount of money. And one point I want
to really try to get across today is, folks, this
is whether you end up using, you believe in it
or whatever AI it is, it is it is changing
(06:02):
the economics of the world. Right. And and as we'll
get into on this ten gigawatt uh situation, ten ten
gigawatt project, I mean, let your imagination wonder. And I
wanted to get to it, but I don't think we'll
have time. But just think about this for a second.
From the infrastructure standpoint, right, you've got to buy the land,
you've got to build a power generating facility, You've got
(06:24):
all the construction costs that are going to it. I
mean you talk about an economic engine, right. You think
about it's just technology, but it's not because in order
to have the technology, you have to have the infrastructure
to do this. And so right, Jason Gaunt, I mean
this is all about. This is about infrastructure on top
of just AI. Right, It's amazing, it's a it's a
(06:46):
whole ecosystem mm hm.
Speaker 3 (06:48):
And it keeps growing every day. Right, That's the part
that you know you can plan for and you know,
I mean like, well maybe you guys touched on it.
I ironically had to reboot my machine to updated IIOS before,
but four Hoover dams, right, I mean, part of it
(07:09):
is just a matter of how much energy can we produce?
Speaker 1 (07:14):
Right.
Speaker 3 (07:14):
I Mean you're seeing the likes of the solar name
starting to pick up again today, Solar Edge, some of
those en phase. It's going to be less about where
we're going to store it, but just real time demand, right.
And that's the thing that I think is going to
be so important too. You've seen these nuclear stocks go parabolic,
(07:36):
you know, I mean some of them where it's like,
oh my gosh, this is up fifty to sixty percent,
I'm going to cut it, and now it's up another
one hundred percent from there. Right, So it's it's it's gotten.
I mean, you can't even guess at this point how
much energy we're going to need. But the tough part
is we don't know, right, I Mean, there have to
be economies of scale at some point, there have to
be efficiencies there aren't going to be one hundred large
(08:00):
language models. They're not going to be thirty providers of
AI technology that all think they're going to be the winner.
There will be some I would say consolidation, like you
mentioned open AI and video of that.
Speaker 1 (08:13):
Today.
Speaker 3 (08:14):
We're just right now in the everyone thinks they can
do it phase, which probably over inflates what the needs are,
but doesn't mean that it's not going to stay over
inflated for some time.
Speaker 1 (08:25):
Right right, I want to I was going to surprise everybody,
but you took my surprise away from me. It's like you,
you know, you took a piece of candy away from somebody.
But this just to put it in perspective. And again
we're going to go through this later. But now that
Jason has said, I want to break this down. So
ten sargle watts of power. Okay, let's put it in
in layman's terms for everybody to understand. So one gigawat
(08:49):
of power is one billion with a bee like boy,
one billion watts. Okay, So that's just one gigawat. So
picture this. One giga WoT of power equals the amount
of power that it takes to power seven hundred and
fifty thousand homes just one gigawatts, and again they announced
ten gigawatts. Okay, here's another way to look at it.
(09:12):
Ten gigawatts is enough to power eight million homes. And
Jason's point, yeap.
Speaker 3 (09:19):
Jason of Marty McFly's cars, yep, because you need one.
Speaker 1 (09:24):
Gigawatts, that's right, that's right. And to Jas's point about
the Hoover Dam, the Hoover Dam generates about two point
five gigawatts at its peak. So for ten gigawatts, you
need four Hoover dams that are running at full capacity.
That's how much power. Uh, this project is going to take.
(09:45):
And remember, folks, this is just one of many, right,
this is just one of many projects out there now
to my knowledge, there has not been one that has
been announced this one to this scale. But what's going
to be really interesting digging into this because again, all
the story came out this after this morning is how
this one hundred billion dollar investment by Navidia into Open Ai,
(10:06):
how this money is going to be spent Because it's
not like Jensen Wong is going to go, hey, guess what,
we're gonna front the money for you to, you know,
to build these This massive facility. There's some i'll call
it creative accounting that's going to go on with this, uh,
this money and and the time period that it's going
to be paid and how it's to be spent in
that type of thing. But you know, Jason, as you
(10:27):
were joining us, uh, you know, as Dennis and I
were saying, what's amazing about this whole thing? This is
again just one of many projects that that Navidia has
announced it. Right, We had the announcement, like I said
last week, with Intel, you know, five billion, and and
the Oracle deal, and you know, on and on and on.
It's like, my gosh, this this is anybody. You don't
hear anybody else in the GPU space, you know, in
(10:49):
the chip manufacturing space, even coming close to them. It's
like they're a million years ahead of anybody else.
Speaker 2 (10:55):
Well, if they had to invest in Intel, Navidia, that
was the five billion, which seems like nothing.
Speaker 1 (11:01):
Now, yeah, petty cash account.
Speaker 2 (11:03):
Eddy cash, We'll take it out of petty cash, you know,
And that was it has to be of course, one
of the formidable chip makers in the world, and yet
they couldn't you know, keep pace and do that too.
So there's there's got to be a lot of separation
between them and everybody else.
Speaker 1 (11:23):
Absolutely all right. When we come back, we're gonna go
ahead and recap today on Wall Street. We'll talk about
what the Navidia stock did today and then get into
this story. What is this one hundred billion dollar investment
by Navidia into open Ai, the parent of chat GPT.
What does this mean to you? We're gonna lay out
some different opportunities that we see potentially for many of you,
So don't go anywhere. Let's turn over to Christina Snow.
(11:43):
We're right now traffic center. Hello, Kristin, Welcome back to
the John Sanchez Show on Newstalk seven eighty k which
with doctor Dennis Sanchez and mister Jason Gun. All right,
once again, we finished fairly nicely today. Sixty six point
game on the doll forty six thousand and three eighty one,
A game of one fifty eight on the nasdak point
seven zero percent, SMB up twenty nine points, record close
(12:07):
zero point four to four percent six thousand, six ninety three,
lost sixteen cents on oil, sixty two to twenty five
a barrel. Jason, what a day for gold? Seventy one
dollars and eighty cent game three thousand, seven seventy seven
and eighty cents. Amazing.
Speaker 3 (12:21):
Yeah, with interest rates going higher, that's the interesting part.
I mean, we had Bostick out today basically Rafae Albostak
fed member stating that he doesn't think we need to
cut anymore was kind of his one liner. And rates,
you know, obviously tacking up a bit, but Gold doesn't care.
It seems like it just continues to climb that wall
(12:43):
with a goal of four thousand bucks an ounce, and
we're not sure what's going to stop it at this point.
Speaker 1 (12:48):
Yeah, Okay, remember when we were talking, three thousand was
the big the big number, right yeah, now, yep, getting
on the heels of four thousand year absolutely right. All right,
if you just joined us, let me tell you we're
gonna be discussing, Jason, give us the stock market review,
and then the big story of the day, Navidia's announcement
of a one hundred billion dollars and to open AI
into a massive, massive data center. But again, there's a
(13:10):
lot to the story. Jason, let me just get the
Navidia stock performance out of the way, because it was
so funny as this interview is going on. All this
broke on CNBC. As this interview is going on, I'm
sitting there, one eye on the video stock performance and
you know, one eye on the interview, and it just
kept higher and higher, and hire more. Jensen Long spoke
to hire the stock guy. Finished the day up seven
(13:32):
dollars and a penny three point ninety seven percent, gained
a one eighty three sixty one and again this big
news one hundred billion dollar investment into a ten giggle
watt uh data center, which again we'll explain what these
data centers are and why the stock did what it did.
But other than that, let's go outside the scope of
Navidia today. Jason's given a nice recap here.
Speaker 3 (13:54):
Yeah, I mean, Megacaps sort of lag today, Meta Google underperform,
Oracle up six plus percent just on the back of
that TikTok deal. They split the CEO role Softra Kats
is going to be moving to the c suite, higher
than the c suite, more of a senior executive on
the board. And really it's the two folks that were
(14:15):
in charge of AI and services that are going to
be now the CEO. So that is another area that's
been very strong. Apple continues to boost things up four
percent today on the back of better than expected iPhone
seventeen demand.
Speaker 1 (14:30):
This is the first at least.
Speaker 3 (14:31):
That I can recall recently of the providers offering free
upgrade basically in that I mean, I know, for mine,
I'm not going to do it because I'm stubborn, but
like I've got an iPhone thirteen Pro Max, and AT
and T said for two dollars and fifty cents a month,
you can have the seventeen Pro, you know. Yeah, I mean, yeah,
(14:53):
it's amazing, and so I think that's causing a lot
of adoption, a lot of excitement around Apple right now,
which China Sai.
Speaker 1 (15:00):
Yeah, Apple said to the Chinese suppliers, boost things up. Boys,
the demand is song. So that's what it really is.
Speaker 3 (15:09):
Yeah, I mean, you know, interest rates taken up a
bit today, as we talked about, you know, ten years
back at four fifteen, despite the fact the Fed cuts rates.
I mean, the number of people that have been like,
why is this happening. It's not supposed to happen again,
the market discounts this far ahead of it happening. But
you know, that's I think spooking folks a touch, but
not on the market side. Equities, you know, continue to
(15:31):
get chased higher. Remember there's a trade call again, it's
called the Rashashana yam Kapor where you're selling Rashashana and
buying yam Kapor. This is September twenty second through October first.
Pretty good hit rate. Again, that's only three quarters of
a percent on average loss during that window of time.
So I'm not pressing you to go day trade your account.
(15:54):
But it's just the time of the year where you
get that quiet period into earnings as well, where companies
are somewhat muzzled from making positive comments. But the market
continues to climb that wall of worry, certainly on the
tech side. So it's pretty interesting to watch as we
just keep any weakness gets bought.
Speaker 1 (16:15):
Well, you know, it's amazing. I was sitting there thinking
today as we're watching the video Skyrocket and Oracle and
some of these others, where would this market be right
now if it were not for AI. Let's let's say
AI was never created, right would probably be you know,
maybe a little bit higher and then change for the year.
I mean, I just had all the yeah, all the
(16:36):
makings of being a kind of a lackluster year until
all the AI news started to come about and so
on and so forth. But man, it is it is
just an overall ecosystem, you know that. It's it's like
creating an entire new economy. It's it's fascinating to watch this,
fascinating to watch this. All right, boys, let's get to
to the highlights here. We got about a minute before
(16:57):
we got to go to break, but let's let's once
again kind of bring out the big news of what
happened today and then we're going to go into great
detail about this. So, like I said, when the CNBC
reporter was asked to stand in front of Jensen Wong,
the CEO of Navidia, and Sam Malton and the CEO
of open Ai, he didn't know what they were talking about,
what they wanted to mean about. But basically what it
(17:18):
is is the following. So Navidia announced today that there
are and open Ai that they have announced a massive,
massive partnership. Navidia is going to invest, as I said earlier,
one hundred billion dollars into open Ai to build huge
AI data centers. Now we're going to describe when we
(17:42):
come back, what is a data center, right, because many
of you you hear the terms like, well, what in
the world is that data center? Again, as we said,
open ai is going to deploy at least ten gigawatts
of Navidia systems again comparable to four Hoover dams Doworth
the power to train and run future AI models. So
we're going to explain all So what does that mean,
train and run open A or open or excuse me,
(18:04):
train and run AI models. Jensen Wong called it a
giant project, reaffront open ai as the fastest growing software
company in history. And those of you that may be
new to the market, no, they are not publicly traded. Unfortunately,
can you imagine where that stock could be? Right now?
My us Sam Maltman again open Ai CEO said, the
output of this super brain will be remarkable in ways
(18:26):
that we don't yet understand.
Speaker 2 (18:30):
That's how we talk about Jason behind this fact.
Speaker 1 (18:32):
That's right, that's right, that's right.
Speaker 3 (18:34):
Maybe just that don't understand the part I don't know about.
Speaker 1 (18:38):
After this run up of seven dollars in a penny,
a three point ninety seven percent on Navidia closing a
one eighty three sixty one this has now pushed the
market cap of Navidia to four point five trillion dollars,
the largest company by market value in the entire world. Now,
remember Oracles Jason mentioned big day to day also and
(19:00):
stock had some nice momentum last week, but once again
today including a little after hours of eighteen dollars and
four cents five point eight four percent gain three twenty
six seventy. Again, remember last week Oracle jumped after a
three hundred billion dollar deal with open Ai, nearing a
one trillion dollar valuation for Oracle. First phase of this
project is expected in the year twenty twenty six, using
(19:22):
the video's upcoming Vera Reuben platform, which will be more
than twice as powerful as the current chips. And we'll
explain what this Vera Ruben platform is. And the deal
may also help lower borrowing costs for open AI's massive
infrastructure build up. This is another big financial takeaway is
with and again I'm going to explain the financial engineering
slash accounting engineering of this one hundred billion dollar investment
(19:44):
because it's not really what you think. Don't think the
video is going to write a check to open Ai
for one hundred billion. It's not the way it's going
to work. But again, what many are saying from a
financial standpoint is this could really lower the borrowing cost
not only for open Ama, but other companies that are
going out and going to the bond market or equity
markets to obtain capital to build out these data centers, right,
(20:07):
because you can't do what you want to do with
AI if you don't have the data center. Well those again,
I mean three to four billion dollars, right, Jason, wasn't
that number? Three to four billion is kind of a Hey,
we're going to break ground on this and build you
a real small one. I mean yeah, it's like a
four billion doesn't get you too much of anything. That's
why we're talking about one hundred billion on this. But
with this type of investment that Navidia announced today, this
(20:27):
could again kind of be the new way that these
companies get funded to build their data center. So again,
a lot of breaking, type of groundbreaking type of data
came out of this press conference, and we're excited to
share it with you. Most importantly, how can you benefit
from it? So we've got a list of how this
whole situation can hopefully help you and your financial dreams
and goals. Let's turned over to Jack Saban. He's got
(20:49):
new traffica weather. Hello Jack, Welcome back to the John
Show in new docs seven and eighty KO it's no
funny things before there, No breaks allowed, No breaks allowed,
keep this thing serious. Joining us, doctor Dennisanchez, Ai, Doctor
Jason Gon of course myself. We finished up sixty six
(21:11):
on the down one to fifty eight game on the
nasdak end up twenty nine on the S and P
five hundred. Many of the excitements of the day again
driven by Navidia. If you just join us once again,
quick summary, Navidia and open Ai, the parent of chat GPT,
announcing a massive deal where Navidia is going to be
investing one hundred billion dollars into a massive data center.
(21:32):
Once again, it's kind of the power consumption is going
to be equivalent to four Hoover dams. It is a massive,
massive undertaking. It's going to be amazing. Ten giggle watts
of power is going to be needed again for Hoover
dam's worth of power to train run these future models,
so on and so forth. So what are we talking about?
Why are we doing this? Well, we're gonna wrap it
(21:54):
up with how can you benefit from this AI boom? Right?
But first Dennis, let's start with you. What did you
think of this announcement today? Again you at the beginning
of the show, you said, and not really all that surprise,
go to more detail.
Speaker 2 (22:09):
You know what. It's interesting because as much as we
talk about it, and we've talked about it all day,
I still really don't understand what the impact is because
we don't know what they're going to do with all
that power. They just keep saying, you know, we yeah,
I mean, we know what the data center is for,
(22:32):
but why why do they need that much? What are
they going to do with all that power? What's the
ultimate outcome from that? That's that's the part I don't understand,
and it's not the part they're sharing. They're telling us
about a construction job basically a big one, an expensive one,
and this is what it's going to do. But what Yeah,
I really don't know what the outcome is they do.
(22:54):
I'm sure they wouldn't build it and get the money,
you know. So that's the part I'm thinking about, is
what what is really the end game there with all
that power? Is it just to have it and say
you have it? And then broker it. And you know,
if you could think of a world where there are
only a few players, we're only you know, it's a
handful of players right now. And I you know, and
(23:17):
noticing these stories. Is it all happening in the US?
Is any of this going on any around the world?
You know, on the same scale.
Speaker 1 (23:24):
The video made a two and a half billion dollar
investment in the.
Speaker 2 (23:27):
UK, just two and a half though.
Speaker 1 (23:34):
Yeah, no, it's and that's what I'm saying. Two to
three billion is just going to get your four walls
and a bunch of dirt. I don't know.
Speaker 2 (23:42):
From from the concept, it's hard to even understand what,
you know, what that power, what we're going to do
with that power, how it impacts us. We just we
kind of gravitate towards things will be faster. Is it
going to be cheaper? You know, it's going to impact
our life and in many ways, probably in ways we
(24:03):
don't even know.
Speaker 1 (24:05):
Well, you know, Jason, what's interesting. I think you just
tripped onto something, Denis, and that is okay, we know
they've got it. In many cases, the local power source
is not large enough or designed to provide this amount
of power, right for I mean for just one megawatt
much less ten like this this new facility. So you know,
(24:28):
again you can look at a lot of infrastructure plays
and go, geez, what's gonna happen with all this power? Right?
Are they going to use every every single want of
power for their data centers or are they going to
sell it off? My other question is, if it's that
easy to build a power generating facility, why haven't you know,
we we I mean, we've had our share of local problems,
(24:49):
you know, from power pretty much any any town has
this scene, especially Texas. Why hasn't somebody, you know, if
they if these if these power centers can power generation
facilities can pop up, quote in a year or two,
why haven't already existing utility company has done that?
Speaker 3 (25:04):
Right?
Speaker 1 (25:04):
They kind of gets you thinking down those lines.
Speaker 2 (25:07):
It has to be connected to what they anticipate, the
kind of power needs are going to be for agents
and that I just think they're so far ahead in
their research and what they know. They they've they've proven
internally what they can already do there. It's a big
secret right now. Well that's that's a big construction job.
(25:28):
But you know where where is that going to go?
Is it We haven't even talked about the potential. Is
there a defense contract somewhere in the mix here?
Speaker 1 (25:38):
You know, of why do we need all that power?
Speaker 2 (25:41):
You know what's what's driving behind this? We have a
connection between Investment AI and the government right now.
Speaker 1 (25:48):
You know.
Speaker 2 (25:50):
What, if they build it.
Speaker 3 (25:51):
Up in like the Antarctic right like where you've got
cool zero zero, maybe it's a lot cheaper to do
it up there, and then we're going to blame them
for melting the ice caps or something along those lines.
Speaker 1 (26:06):
So okay, so let's let's kind of hit some of
these definitions for our listeners that are not familiar with it.
So once again on this situation, ten giga wise equals
again roughly four to five million GPUs. That's about what
Navidia ships in a year at its current piece, four
to five million GPUs. Who wants to go for the
definition of what a GPU is?
Speaker 2 (26:28):
That one's that one's the easiest one I can get
if you like. It stands for a graphics processing unit.
And think of it the GPU similar to the CPU
that we we've been more familiar with our computers, except
it's a lot different. You know, you you pretty much
have one chip in the CPU maybe maybe, Uh, they've
(26:52):
had parallel processing for a long time, so you may
have two chips working in parallel. But with GPU, you're
talking about thousands of chips doing the same thing. So
if a process requires multiple steps, they're all in step,
thousands of them doing at the same time, which which
gives them a lot of power. So it's the number
(27:13):
of chips you're you're you're managing and working with has
driven by the gigawatts that that power to basically do
the training which is teaching these model uh, the the
software that these patterns, and that's really what they're doing
with all that power, more and more and more patterns.
Speaker 1 (27:36):
I like the analogy you gave in your notes, and
that is a CPU. Again, what your normal computer has
is a master chef, great at complex steps, one at
a time. The GPU are stadium kitchens, thousands of line
cooks doing similar steps simultaneously. That's why we need many
of them.
Speaker 2 (27:54):
Mm hmmm mmmm.
Speaker 1 (27:56):
All right, Now here's a little trivia for you along
this point. How many GPUs did chat GPT three point
five us? Now we're on chat GPT five right, So.
Speaker 2 (28:07):
We're going to go back in twenty twenty two too, right.
Speaker 1 (28:09):
Open ai never published an official count of how many
GPUs they needed. Independent estimates at the time put training
in the ballpark of ten thousand Navidia GPUs. Microsoft publicly
described building supercomputers with thousands of Navidia's GPUs for open AI.
Today's usage is even larger because inference, which is serving
(28:31):
answers to millions of people. Dwarf's a one time training run.
So again Open AI in Oracle, they expanded six or
four point five gigawats. That deal was the last announced.
Last week American Infrastructure Partnership, a finance plus cloud coalition
with Microsoft, Black Rocket, MGX AIM and mobilized tens of
(28:53):
billions up tow one hundred billion dollars a matter of fact,
into AI infrastructure again, that five billion dollar deal with
Intel last week on and so forth. Now, let's kind
of walk through Dennis what or Jason, either one of you? What?
What did well? You were a time already? What is
the you know, what's inside the walls of a data center? Right,
(29:15):
one of these massive data centers that need again equivalent
in this example for hoover dams of electrical outputs. So
let's kind of walk the audience inside of it, and
then we'll wrap up with how all of this can
benefit our listeners are very special guest doctor Dennis Sanchez,
Jason myself. Let's turn it over to Christen Snow right
now Traffic Center. Risten, Welcome back to the John Sanchez
(29:37):
Show on News Talk seven eighty k Ochry. We're talking
about what does the videos one hundred billion dollar investment
mean for you, this big announcement that came out today.
I want to talk about this, this this the financial
side real quickly, and then we'll get to again how
this can can benefit you. So Jensen Wong and the video,
they're not going to just write a check as I
said to open Ai to uh, you know, for this
(30:00):
this massive one hundred billion dollar investment. So what this
basically is gonna be, It's gonna be kind of called.
I'm gonna call it circular accounting. So I'll make a
real simple let's break it down to a million dollars,
so Navidia will give and now use that term. I
don't know if it's a it's not a gift, but
a promisory note. Whatever it is, I'm just gonna use
(30:21):
the term gift. This million dollars to open Ai. But
Open Ai can't use that money and go do whatever
they want to do. What do they have to do.
They've got to turn around and buy a million dollars
worth of Navidia chips. So yeah, you used to see
Jason's look on his face. Yeah, that's what I mean.
Circular account Jason, think about this from an earnings per
(30:42):
share standpoint. What if this sec or somebody wakes up
when day and goes is this kind of yeah, mickey
mouse accounting, It's like you're almost paying for your own
earnings numbers.
Speaker 3 (30:54):
That's what the issue with SMC I was remember that
stock super micro right where that thing got destroyed because
they were you know, people thought they were doing that
within video and there were all these other companies that
people were writing articles about where you know, they sort
of existed in order to buy in video chips in
countries that couldn't buy in video chips and ship them. Like,
(31:17):
there's a lot of that concern. I would agree with you,
and almost like a mortgage backed security, you know, triple
leverage clos that we had back in the day, when
you're like, wait a minute, the same thing's happening multiple
multiple times. Here product right exactly and your counting iss
earnings exactly. And so that agreed could certainly become a
(31:39):
problem in the future if there's a circular reference error
of some kind where your Excel freaks out and says,
uh uh no, but the market right now doesn't seem
to be ready to do that yet.
Speaker 1 (31:50):
No. No. But you know, Dennis, you all three of
us were chatting during the break, and you're absolutely right
on this point. And that is what's the risk of this, right,
you're not a stock marker guy anymore, but you were
for many years. And yeah, you're looking at it not
only from the textandpoint, but the risk standpoint. We all,
all three of us lived through the dot com bust, right,
nothing could go wrong, Everything's going to go uh, this
thing is never going to stop. And then all of
(32:12):
a sudden, you know, those those illustrious words by Alan Greenspan,
irrational irrational exuberance, and that's all it took and the
whole house of cars came crashing down. Are we at
risk of something like that with this? Because you know, Jason,
you said the same thing. Technology changing so fast, we
got quantum computing coming could we in five, ten, ten years,
(32:32):
I don't know, let's go ten years. Could these data
centers that are costing billions and billions? Could they be
nothing more than a big bunch of concrete walls and
you know, almost looking like KT Yeah, yeah, exactly, what's
kmart centers? Roebucks that type of thing.
Speaker 3 (32:46):
And I've seen some negative pieces about right, I think
of how quick technology advances, like the fact we went
from this chip set to this chip set to this
chip set in video that if they've got an even
five year shelf, I mean, heck, five years ago, what
even was AI in the way that we know it now?
So imagine the chips now five years from now and
(33:08):
the cost that they are, right versus the revenue that
a data center makes. I've seen numbers where essentially the
costs are two x what the data center will even
make over that period of time. And you're like that
math doesn't it's not mathing right, Like, so that's why
and Nvidia says, hey, we'll give you money for you
to buy our stuff for X number of years in
(33:30):
order to Hey, we have our tentacles in you and
you're not going to go to a MD or to
whoever else and it yeah, it's it. At some point
the math won't math right. But for now, like we'd said,
there's still enough of a runway that I think there's
still time to the story for sure.
Speaker 2 (33:47):
Absolute you want to anything to that, No, I just again,
I'm stuck on the end. It's probably pretty dumb for
me to say this. With the antiquity of this model.
We're still talking about chips, power, cooling, construction, the same
elements that we were talking about. We were building data
center twenty years ago, same thing, larger scale, got the.
Speaker 1 (34:12):
Small nuclear nuclear nodes that the US supply the power.
Speaker 2 (34:16):
So that that concerns me and it kind of begs
for another solution to emerge, which would just really annihilate,
right model.
Speaker 1 (34:27):
Well, I mean, what if just you were talking about
quantum competing, right, which we don't try to get into that,
but that's kind of like kind of quote the next
generation of what that with computing is going to do
is to the quantum computing. What if there was one
massive data center that hows you said you saw one
on your trip to New York. That was what in
a church you said.
Speaker 3 (34:45):
Oh so yeah, so this is it? Rensally or Polytech.
This is the school. My youngest son wants to go
to RPI in upstate New York and they have an
IBM quantum computer there and it's the size of you know,
I don't know twenty that big, but yeah, I mean
that those are what will be the next generation of
speed and compute where you don't need as much storage
(35:09):
right as we have now, So it technology will advance
in just a matter of yes, are you buying the
beta or are you buying the VHS?
Speaker 1 (35:18):
Right? And we'll see. Well in the meantime, what are
the benefits that we can all take advantage of? And
again there's no stock recommendations here, but just things for
you to be thinking about. Right, So how does this
whole situation potentially benefit us? Well, first of all, we've
got the stock market impact, right, the names that we
talked about all the time. Then the video is the
Oracles et cetera. AI related stocks you know, continue to rally, right,
(35:41):
we'll continue forever? Absolutely not. Do you have some chance
to potentially make some money down the road? Maybe so?
Or when I say down the road, maybe at any point.
So diversified portfolio, but you know, do you you know
based upon your risk and goals, you should be considering
an allocation to AI and all the infrastructure. We talked
about tech revolution again, just about the chips. We're talking
about reshaping economies right as becoming a critical for electricity,
(36:04):
the adoption really, how it's going to transform our daily lives,
the investment opportunity again, different companies tied to the AI infrastructure.
You look at semiconductors, cloud, the different data centers. Again,
this is kind of the picks and shovels play of
the gold Rush. So there's a lot of different ways
that you can play this and as always, be cautious
about this whole situation because you never know when things
(36:25):
can change. Is the boys just got done, Sam, that's
a lot of fun boys. Thank you so very much
everybody for joining us. We do appreciate it. We'll do
it again tomorrow on the John Sanchez Show. God bless,
have a great afternoon. John Sanchez is a registered investment advisor,
and the opinions expressed by Sanchez Gone Capital Management, LLC
on the show or their own and do not reflect
the opinions of News Talks seven eighty or its pairing company,
(36:46):
Cumulus Media. All statements and opinions expressed are based upon
information considered reliable, although it should not be relied upon.
As such, any statements or opinions are subject to change
without notice. Information presented is for educational purposes only and
does not intend to make an offer or solicitation for
the sale or purchase of any specific securities, investments, or
(37:07):
investment strategies. Investments involve risk, and, unless otherwise stated or
not guaranteed, information expressed does not take into account your
specific situation or objectives, and is not intended as recommendations
appropriate for any individual. Listeners are encouraged to seek advice
from a qualified tax, legal, or investment advisor to determine
whether any information presented may be suitable for their specific situation.
(37:31):
Past performance is not indicative of future performance.
Good Monday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty K which it's a
whole pleasure to be with you. Mister Gunt will be
joining us momentarily, but in the meantime we do have
not that it's a substitute by eighty means he's a
man in and of himself. Doctor Dennis Sanchez, the AI
Doctor for our Monday AI session. How you doing, bro?
Speaker 2 (00:22):
I'm doing great.
Speaker 1 (00:23):
How you doing, bro? Fantastic, man, fantastic. Been looking forward
to this all day long. Always nice to get a
chance to see you, talk to you, and definitely further
our education on AI. To say the least.
Speaker 2 (00:37):
I can't believe how far you've come about AI since
we first start thanks to you.
Speaker 1 (00:44):
Yeah, yeah, it's I know, I was just thinking back
on that. It's funny you bring that up. I was
thinking back to that just I think over the weekend,
it's like we're not so much just me, but just
the whole AI industry. Right, it was not long ago
where we're going, what's this thing called chat GPT and
(01:04):
you know, you look where we are now as far
as the industry, and you know the analogy that that
all of us usually give on on Mondays. When we
have you on is our heads are spinning. Things are
going so very very fast. Right, That's that's about it.
I can't imagine for you being in it, in the
thick of it all day every day. Oh my goodness. Well,
i'll tell you what. It is a great, great time
(01:26):
to have doctor Dennis Sanchez on the show today because folks,
we had a major announcement that was announced that came
out this morning. Uh, it was not planned. It was
on CNBC. And who was involved with it. Jensen Wong,
the CEO of Navidio, and Sam Altman of course, the
CEO of open Ai, uh the parent of chat GPT
and many other great things. And what was funny, Dennis,
(01:49):
I think I was telling you about this when seemed
to see their their tech reporter. He started the interview
off by saying, you know, you guys called me here
and I didn't know what you want to talk about,
so you know, yeah, exactly. Then they dropped this one
hundred billion dollar, one hundred billion dollar bomb on everybody,
(02:11):
and my gosh, it was perfect timing for our subject
this afternoon, which is what does Navidia's one hundred billion
dollar investment mean for you, right, that's what we're talking about. Now,
let's go back real quick here, lay out the stage
of what we're going to be discussing. Get the stock
market side going. So again, this was an absolutely surprising
announcement this morning between the two gentlemen. I just mentioned
(02:34):
a one hundred billion dollar investment buy Navidia into open AI. Uh.
This investment is going to be a ten gigawatch project.
Now you may be going, what heck does that mean? Well,
don't worry, We're going to measure power. Yeah, a whole
bunch of powers. I'm going to give you an analogy here,
h a ten gigawatch project, something again, no one has
(02:56):
ever seen before. So our purpose today is to say, look,
what does this mean for you? How are you going
to be using AI in the future. But we're also
going to get some of these terms that we've been
throwing out here. Dennis is going to be explaining these
into layman's terms, and you know, try to make sense
of it, because folks, whether you're investing in AI or
(03:17):
you're using AI in your personal life, your business life,
there's a lot of terms that you may be hearing
and maybe even using, you don't truly understand what they are.
So that's going to be part of our education each
Monday when Dennis is on for the AI segment, is
to really begin to explain what these are so that you,
of course confurther your knowledge. And again that is one
of the many, many reasons that we have a dentis
(03:39):
on each and every Monday. Real quick, before we get
started on the stock marketing side, dentists, what did you
think of this announcement? Were you surprised or were you,
like like the rest of us, like my god, this
is serious money that Navidia is investing.
Speaker 2 (03:51):
Honestly, I'm a little bit numb by it, are you?
Speaker 1 (03:54):
Really?
Speaker 2 (03:55):
It's becoming well, and I look at how it's dominating.
This kind of mission is dominating the news every single day.
And it's a handful of players. It's not like we're
it's a new name every day. You know, it's it's Microsoft,
it's it's Meta Oracle, it's Meta, it's you know, open
(04:15):
AIY is always kind of in the mix there, and
the video seems to be really dominating the conversation, so
it's hard to even understand what one hundred billion dollar
deal is but we're throwing these around fifty billion, one
hundred billion just in the investments in this technology, and
(04:36):
we don't you know, we're sitting out here going, I mean,
I don't even understand that number.
Speaker 1 (04:40):
It's so big.
Speaker 2 (04:40):
But then again, like you said, how is that going
to filter down to us? Because we know it's going
to have ratifications on a lot of different levels, the
stock value, the you know, our lives, and I think
we're here to talk about how it's going to impact
our lives.
Speaker 1 (04:56):
Absolutely, absolutely we are. Yeah, not only I mean and
again when you say impact our lives, it can be
from a lot of different standpoints, whether it's from an
investment standpoint, uh, whether it's from again personal usage, business uses,
et cetera. I think with this announcement today is we're
going to go into more detail here momentarily. This is
again revolutionary, right, this is a this is a company
(05:17):
meaning the video and by no means are we sitting
here recommending the stock or anything. It's just they're they're
at the core heart of all this. You know, this
is on top of the massive announcements they made last
week with you know, significant investments into Oracle and significant
investments into a lot of different things. I mean Intel,
(05:40):
you know, five billion dollar investment last week and do
and do uh into Intel. And again it's just mind
boggling the amount of money. And one point I want
to really try to get across today is, folks, this
is whether you end up using, you believe in it
or whatever AI it is, it is it is changing
(06:02):
the economics of the world. Right. And and as we'll
get into on this ten gigawatt uh situation, ten ten
gigawatt project, I mean, let your imagination wonder. And I
wanted to get to it, but I don't think we'll
have time. But just think about this for a second.
From the infrastructure standpoint, right, you've got to buy the land,
you've got to build a power generating facility, You've got
(06:24):
all the construction costs that are going to it. I
mean you talk about an economic engine, right. You think
about it's just technology, but it's not because in order
to have the technology, you have to have the infrastructure
to do this. And so right, Jason Gaunt, I mean
this is all about. This is about infrastructure on top
of just AI. Right, It's amazing, it's a it's a
(06:46):
whole ecosystem mm hm.
Speaker 3 (06:48):
And it keeps growing every day. Right, That's the part
that you know you can plan for and you know,
I mean like, well maybe you guys touched on it.
I ironically had to reboot my machine to updated IIOS before,
but four Hoover dams, right, I mean, part of it
(07:09):
is just a matter of how much energy can we produce?
Speaker 1 (07:14):
Right.
Speaker 3 (07:14):
I Mean you're seeing the likes of the solar name
starting to pick up again today, Solar Edge, some of
those en phase. It's going to be less about where
we're going to store it, but just real time demand, right.
And that's the thing that I think is going to
be so important too. You've seen these nuclear stocks go parabolic,
(07:36):
you know, I mean some of them where it's like,
oh my gosh, this is up fifty to sixty percent,
I'm going to cut it, and now it's up another
one hundred percent from there. Right, So it's it's it's gotten.
I mean, you can't even guess at this point how
much energy we're going to need. But the tough part
is we don't know, right, I Mean, there have to
be economies of scale at some point, there have to
be efficiencies there aren't going to be one hundred large
(08:00):
language models. They're not going to be thirty providers of
AI technology that all think they're going to be the winner.
There will be some I would say consolidation, like you
mentioned open AI and video of that.
Speaker 1 (08:13):
Today.
Speaker 3 (08:14):
We're just right now in the everyone thinks they can
do it phase, which probably over inflates what the needs are,
but doesn't mean that it's not going to stay over
inflated for some time.
Speaker 1 (08:25):
Right right, I want to I was going to surprise everybody,
but you took my surprise away from me. It's like you,
you know, you took a piece of candy away from somebody.
But this just to put it in perspective. And again
we're going to go through this later. But now that
Jason has said, I want to break this down. So
ten sargle watts of power. Okay, let's put it in
in layman's terms for everybody to understand. So one gigawat
(08:49):
of power is one billion with a bee like boy,
one billion watts. Okay, So that's just one gigawat. So
picture this. One giga WoT of power equals the amount
of power that it takes to power seven hundred and
fifty thousand homes just one gigawatts, and again they announced
ten gigawatts. Okay, here's another way to look at it.
(09:12):
Ten gigawatts is enough to power eight million homes. And
Jason's point, yeap.
Speaker 3 (09:19):
Jason of Marty McFly's cars, yep, because you need one.
Speaker 1 (09:24):
Gigawatts, that's right, that's right. And to Jas's point about
the Hoover Dam, the Hoover Dam generates about two point
five gigawatts at its peak. So for ten gigawatts, you
need four Hoover dams that are running at full capacity.
That's how much power. Uh, this project is going to take.
(09:45):
And remember, folks, this is just one of many, right,
this is just one of many projects out there now
to my knowledge, there has not been one that has
been announced this one to this scale. But what's going
to be really interesting digging into this because again, all
the story came out this after this morning is how
this one hundred billion dollar investment by Navidia into Open Ai,
(10:06):
how this money is going to be spent Because it's
not like Jensen Wong is going to go, hey, guess what,
we're gonna front the money for you to, you know,
to build these This massive facility. There's some i'll call
it creative accounting that's going to go on with this, uh,
this money and and the time period that it's going
to be paid and how it's to be spent in
that type of thing. But you know, Jason, as you
(10:27):
were joining us, uh, you know, as Dennis and I
were saying, what's amazing about this whole thing? This is
again just one of many projects that that Navidia has
announced it. Right, We had the announcement, like I said
last week, with Intel, you know, five billion, and and
the Oracle deal, and you know, on and on and on.
It's like, my gosh, this this is anybody. You don't
hear anybody else in the GPU space, you know, in
(10:49):
the chip manufacturing space, even coming close to them. It's
like they're a million years ahead of anybody else.
Speaker 2 (10:55):
Well, if they had to invest in Intel, Navidia, that
was the five billion, which seems like nothing.
Speaker 1 (11:01):
Now, yeah, petty cash account.
Speaker 2 (11:03):
Eddy cash, We'll take it out of petty cash, you know,
And that was it has to be of course, one
of the formidable chip makers in the world, and yet
they couldn't you know, keep pace and do that too.
So there's there's got to be a lot of separation
between them and everybody else.
Speaker 1 (11:23):
Absolutely all right. When we come back, we're gonna go
ahead and recap today on Wall Street. We'll talk about
what the Navidia stock did today and then get into
this story. What is this one hundred billion dollar investment
by Navidia into open Ai, the parent of chat GPT.
What does this mean to you? We're gonna lay out
some different opportunities that we see potentially for many of you,
So don't go anywhere. Let's turn over to Christina Snow.
(11:43):
We're right now traffic center. Hello, Kristin, Welcome back to
the John Sanchez Show on Newstalk seven eighty k which
with doctor Dennis Sanchez and mister Jason Gun. All right,
once again, we finished fairly nicely today. Sixty six point
game on the doll forty six thousand and three eighty one,
A game of one fifty eight on the nasdak point
seven zero percent, SMB up twenty nine points, record close
(12:07):
zero point four to four percent six thousand, six ninety three,
lost sixteen cents on oil, sixty two to twenty five
a barrel. Jason, what a day for gold? Seventy one
dollars and eighty cent game three thousand, seven seventy seven
and eighty cents. Amazing.
Speaker 3 (12:21):
Yeah, with interest rates going higher, that's the interesting part.
I mean, we had Bostick out today basically Rafae Albostak
fed member stating that he doesn't think we need to
cut anymore was kind of his one liner. And rates,
you know, obviously tacking up a bit, but Gold doesn't care.
It seems like it just continues to climb that wall
(12:43):
with a goal of four thousand bucks an ounce, and
we're not sure what's going to stop it at this point.
Speaker 1 (12:48):
Yeah, Okay, remember when we were talking, three thousand was
the big the big number, right yeah, now, yep, getting
on the heels of four thousand year absolutely right. All right,
if you just joined us, let me tell you we're
gonna be discussing, Jason, give us the stock market review,
and then the big story of the day, Navidia's announcement
of a one hundred billion dollars and to open AI
into a massive, massive data center. But again, there's a
(13:10):
lot to the story. Jason, let me just get the
Navidia stock performance out of the way, because it was
so funny as this interview is going on. All this
broke on CNBC. As this interview is going on, I'm
sitting there, one eye on the video stock performance and
you know, one eye on the interview, and it just
kept higher and higher, and hire more. Jensen Long spoke
to hire the stock guy. Finished the day up seven
(13:32):
dollars and a penny three point ninety seven percent, gained
a one eighty three sixty one and again this big
news one hundred billion dollar investment into a ten giggle
watt uh data center, which again we'll explain what these
data centers are and why the stock did what it did.
But other than that, let's go outside the scope of
Navidia today. Jason's given a nice recap here.
Speaker 3 (13:54):
Yeah, I mean, Megacaps sort of lag today, Meta Google underperform,
Oracle up six plus percent just on the back of
that TikTok deal. They split the CEO role Softra Kats
is going to be moving to the c suite, higher
than the c suite, more of a senior executive on
the board. And really it's the two folks that were
(14:15):
in charge of AI and services that are going to
be now the CEO. So that is another area that's
been very strong. Apple continues to boost things up four
percent today on the back of better than expected iPhone
seventeen demand.
Speaker 1 (14:30):
This is the first at least.
Speaker 3 (14:31):
That I can recall recently of the providers offering free
upgrade basically in that I mean, I know, for mine,
I'm not going to do it because I'm stubborn, but
like I've got an iPhone thirteen Pro Max, and AT
and T said for two dollars and fifty cents a month,
you can have the seventeen Pro, you know. Yeah, I mean, yeah,
(14:53):
it's amazing, and so I think that's causing a lot
of adoption, a lot of excitement around Apple right now,
which China Sai.
Speaker 1 (15:00):
Yeah, Apple said to the Chinese suppliers, boost things up. Boys,
the demand is song. So that's what it really is.
Speaker 3 (15:09):
Yeah, I mean, you know, interest rates taken up a
bit today, as we talked about, you know, ten years
back at four fifteen, despite the fact the Fed cuts rates.
I mean, the number of people that have been like,
why is this happening. It's not supposed to happen again,
the market discounts this far ahead of it happening. But
you know, that's I think spooking folks a touch, but
not on the market side. Equities, you know, continue to
(15:31):
get chased higher. Remember there's a trade call again, it's
called the Rashashana yam Kapor where you're selling Rashashana and
buying yam Kapor. This is September twenty second through October first.
Pretty good hit rate. Again, that's only three quarters of
a percent on average loss during that window of time.
So I'm not pressing you to go day trade your account.
(15:54):
But it's just the time of the year where you
get that quiet period into earnings as well, where companies
are somewhat muzzled from making positive comments. But the market
continues to climb that wall of worry, certainly on the
tech side. So it's pretty interesting to watch as we
just keep any weakness gets bought.
Speaker 1 (16:15):
Well, you know, it's amazing. I was sitting there thinking
today as we're watching the video Skyrocket and Oracle and
some of these others, where would this market be right
now if it were not for AI. Let's let's say
AI was never created, right would probably be you know,
maybe a little bit higher and then change for the year.
I mean, I just had all the yeah, all the
(16:36):
makings of being a kind of a lackluster year until
all the AI news started to come about and so
on and so forth. But man, it is it is
just an overall ecosystem, you know that. It's it's like
creating an entire new economy. It's it's fascinating to watch this,
fascinating to watch this. All right, boys, let's get to
to the highlights here. We got about a minute before
(16:57):
we got to go to break, but let's let's once
again kind of bring out the big news of what
happened today and then we're going to go into great
detail about this. So, like I said, when the CNBC
reporter was asked to stand in front of Jensen Wong,
the CEO of Navidia, and Sam Malton and the CEO
of open Ai, he didn't know what they were talking about,
what they wanted to mean about. But basically what it
(17:18):
is is the following. So Navidia announced today that there
are and open Ai that they have announced a massive,
massive partnership. Navidia is going to invest, as I said earlier,
one hundred billion dollars into open Ai to build huge
AI data centers. Now we're going to describe when we
(17:42):
come back, what is a data center, right, because many
of you you hear the terms like, well, what in
the world is that data center? Again, as we said,
open ai is going to deploy at least ten gigawatts
of Navidia systems again comparable to four Hoover dams Doworth
the power to train and run future AI models. So
we're going to explain all So what does that mean,
train and run open A or open or excuse me,
(18:04):
train and run AI models. Jensen Wong called it a
giant project, reaffront open ai as the fastest growing software
company in history. And those of you that may be
new to the market, no, they are not publicly traded. Unfortunately,
can you imagine where that stock could be? Right now?
My us Sam Maltman again open Ai CEO said, the
output of this super brain will be remarkable in ways
(18:26):
that we don't yet understand.
Speaker 2 (18:30):
That's how we talk about Jason behind this fact.
Speaker 1 (18:32):
That's right, that's right, that's right.
Speaker 3 (18:34):
Maybe just that don't understand the part I don't know about.
Speaker 1 (18:38):
After this run up of seven dollars in a penny,
a three point ninety seven percent on Navidia closing a
one eighty three sixty one this has now pushed the
market cap of Navidia to four point five trillion dollars,
the largest company by market value in the entire world. Now,
remember Oracles Jason mentioned big day to day also and
(19:00):
stock had some nice momentum last week, but once again
today including a little after hours of eighteen dollars and
four cents five point eight four percent gain three twenty
six seventy. Again, remember last week Oracle jumped after a
three hundred billion dollar deal with open Ai, nearing a
one trillion dollar valuation for Oracle. First phase of this
project is expected in the year twenty twenty six, using
(19:22):
the video's upcoming Vera Reuben platform, which will be more
than twice as powerful as the current chips. And we'll
explain what this Vera Ruben platform is. And the deal
may also help lower borrowing costs for open AI's massive
infrastructure build up. This is another big financial takeaway is
with and again I'm going to explain the financial engineering
slash accounting engineering of this one hundred billion dollar investment
(19:44):
because it's not really what you think. Don't think the
video is going to write a check to open Ai
for one hundred billion. It's not the way it's going
to work. But again, what many are saying from a
financial standpoint is this could really lower the borrowing cost
not only for open Ama, but other companies that are
going out and going to the bond market or equity
markets to obtain capital to build out these data centers, right,
(20:07):
because you can't do what you want to do with
AI if you don't have the data center. Well those again,
I mean three to four billion dollars, right, Jason, wasn't
that number? Three to four billion is kind of a Hey,
we're going to break ground on this and build you
a real small one. I mean yeah, it's like a
four billion doesn't get you too much of anything. That's
why we're talking about one hundred billion on this. But
with this type of investment that Navidia announced today, this
(20:27):
could again kind of be the new way that these
companies get funded to build their data center. So again,
a lot of breaking, type of groundbreaking type of data
came out of this press conference, and we're excited to
share it with you. Most importantly, how can you benefit
from it? So we've got a list of how this
whole situation can hopefully help you and your financial dreams
and goals. Let's turned over to Jack Saban. He's got
(20:49):
new traffica weather. Hello Jack, Welcome back to the John
Show in new docs seven and eighty KO it's no
funny things before there, No breaks allowed, No breaks allowed,
keep this thing serious. Joining us, doctor Dennisanchez, Ai, Doctor
Jason Gon of course myself. We finished up sixty six
(21:11):
on the down one to fifty eight game on the
nasdak end up twenty nine on the S and P
five hundred. Many of the excitements of the day again
driven by Navidia. If you just join us once again,
quick summary, Navidia and open Ai, the parent of chat GPT,
announcing a massive deal where Navidia is going to be
investing one hundred billion dollars into a massive data center.
(21:32):
Once again, it's kind of the power consumption is going
to be equivalent to four Hoover dams. It is a massive,
massive undertaking. It's going to be amazing. Ten giggle watts
of power is going to be needed again for Hoover
dam's worth of power to train run these future models,
so on and so forth. So what are we talking about?
Why are we doing this? Well, we're gonna wrap it
(21:54):
up with how can you benefit from this AI boom? Right?
But first Dennis, let's start with you. What did you
think of this announcement today? Again you at the beginning
of the show, you said, and not really all that surprise,
go to more detail.
Speaker 2 (22:09):
You know what. It's interesting because as much as we
talk about it, and we've talked about it all day,
I still really don't understand what the impact is because
we don't know what they're going to do with all
that power. They just keep saying, you know, we yeah,
I mean, we know what the data center is for,
(22:32):
but why why do they need that much? What are
they going to do with all that power? What's the
ultimate outcome from that? That's that's the part I don't understand,
and it's not the part they're sharing. They're telling us
about a construction job basically a big one, an expensive one,
and this is what it's going to do. But what Yeah,
I really don't know what the outcome is they do.
(22:54):
I'm sure they wouldn't build it and get the money,
you know. So that's the part I'm thinking about, is
what what is really the end game there with all
that power? Is it just to have it and say
you have it? And then broker it. And you know,
if you could think of a world where there are
only a few players, we're only you know, it's a
handful of players right now. And I you know, and
(23:17):
noticing these stories. Is it all happening in the US?
Is any of this going on any around the world?
You know, on the same scale.
Speaker 1 (23:24):
The video made a two and a half billion dollar
investment in the.
Speaker 2 (23:27):
UK, just two and a half though.
Speaker 1 (23:34):
Yeah, no, it's and that's what I'm saying. Two to
three billion is just going to get your four walls
and a bunch of dirt. I don't know.
Speaker 2 (23:42):
From from the concept, it's hard to even understand what,
you know, what that power, what we're going to do
with that power, how it impacts us. We just we
kind of gravitate towards things will be faster. Is it
going to be cheaper? You know, it's going to impact
our life and in many ways, probably in ways we
(24:03):
don't even know.
Speaker 1 (24:05):
Well, you know, Jason, what's interesting. I think you just
tripped onto something, Denis, and that is okay, we know
they've got it. In many cases, the local power source
is not large enough or designed to provide this amount
of power, right for I mean for just one megawatt
much less ten like this this new facility. So you know,
(24:28):
again you can look at a lot of infrastructure plays
and go, geez, what's gonna happen with all this power? Right?
Are they going to use every every single want of
power for their data centers or are they going to
sell it off? My other question is, if it's that
easy to build a power generating facility, why haven't you know,
we we I mean, we've had our share of local problems,
(24:49):
you know, from power pretty much any any town has
this scene, especially Texas. Why hasn't somebody, you know, if
they if these if these power centers can power generation
facilities can pop up, quote in a year or two,
why haven't already existing utility company has done that?
Speaker 3 (25:04):
Right?
Speaker 1 (25:04):
They kind of gets you thinking down those lines.
Speaker 2 (25:07):
It has to be connected to what they anticipate, the
kind of power needs are going to be for agents
and that I just think they're so far ahead in
their research and what they know. They they've they've proven
internally what they can already do there. It's a big
secret right now. Well that's that's a big construction job.
(25:28):
But you know where where is that going to go?
Is it We haven't even talked about the potential. Is
there a defense contract somewhere in the mix here?
Speaker 1 (25:38):
You know, of why do we need all that power?
Speaker 2 (25:41):
You know what's what's driving behind this? We have a
connection between Investment AI and the government right now.
Speaker 1 (25:48):
You know.
Speaker 2 (25:50):
What, if they build it.
Speaker 3 (25:51):
Up in like the Antarctic right like where you've got
cool zero zero, maybe it's a lot cheaper to do
it up there, and then we're going to blame them
for melting the ice caps or something along those lines.
Speaker 1 (26:06):
So okay, so let's let's kind of hit some of
these definitions for our listeners that are not familiar with it.
So once again on this situation, ten giga wise equals
again roughly four to five million GPUs. That's about what
Navidia ships in a year at its current piece, four
to five million GPUs. Who wants to go for the
definition of what a GPU is?
Speaker 2 (26:28):
That one's that one's the easiest one I can get
if you like. It stands for a graphics processing unit.
And think of it the GPU similar to the CPU
that we we've been more familiar with our computers, except
it's a lot different. You know, you you pretty much
have one chip in the CPU maybe maybe, Uh, they've
(26:52):
had parallel processing for a long time, so you may
have two chips working in parallel. But with GPU, you're
talking about thousands of chips doing the same thing. So
if a process requires multiple steps, they're all in step,
thousands of them doing at the same time, which which
gives them a lot of power. So it's the number
(27:13):
of chips you're you're you're managing and working with has
driven by the gigawatts that that power to basically do
the training which is teaching these model uh, the the
software that these patterns, and that's really what they're doing
with all that power, more and more and more patterns.
Speaker 1 (27:36):
I like the analogy you gave in your notes, and
that is a CPU. Again, what your normal computer has
is a master chef, great at complex steps, one at
a time. The GPU are stadium kitchens, thousands of line
cooks doing similar steps simultaneously. That's why we need many
of them.
Speaker 2 (27:54):
Mm hmmm mmmm.
Speaker 1 (27:56):
All right, Now here's a little trivia for you along
this point. How many GPUs did chat GPT three point
five us? Now we're on chat GPT five right, So.
Speaker 2 (28:07):
We're going to go back in twenty twenty two too, right.
Speaker 1 (28:09):
Open ai never published an official count of how many
GPUs they needed. Independent estimates at the time put training
in the ballpark of ten thousand Navidia GPUs. Microsoft publicly
described building supercomputers with thousands of Navidia's GPUs for open AI.
Today's usage is even larger because inference, which is serving
(28:31):
answers to millions of people. Dwarf's a one time training run.
So again Open AI in Oracle, they expanded six or
four point five gigawats. That deal was the last announced.
Last week American Infrastructure Partnership, a finance plus cloud coalition
with Microsoft, Black Rocket, MGX AIM and mobilized tens of
(28:53):
billions up tow one hundred billion dollars a matter of fact,
into AI infrastructure again, that five billion dollar deal with
Intel last week on and so forth. Now, let's kind
of walk through Dennis what or Jason, either one of you? What?
What did well? You were a time already? What is
the you know, what's inside the walls of a data center? Right,
(29:15):
one of these massive data centers that need again equivalent
in this example for hoover dams of electrical outputs. So
let's kind of walk the audience inside of it, and
then we'll wrap up with how all of this can
benefit our listeners are very special guest doctor Dennis Sanchez,
Jason myself. Let's turn it over to Christen Snow right
now Traffic Center. Risten, Welcome back to the John Sanchez
(29:37):
Show on News Talk seven eighty k Ochry. We're talking
about what does the videos one hundred billion dollar investment
mean for you, this big announcement that came out today.
I want to talk about this, this this the financial
side real quickly, and then we'll get to again how
this can can benefit you. So Jensen Wong and the video,
they're not going to just write a check as I
said to open Ai to uh, you know, for this
(30:00):
this massive one hundred billion dollar investment. So what this
basically is gonna be, It's gonna be kind of called.
I'm gonna call it circular accounting. So I'll make a
real simple let's break it down to a million dollars,
so Navidia will give and now use that term. I
don't know if it's a it's not a gift, but
a promisory note. Whatever it is, I'm just gonna use
(30:21):
the term gift. This million dollars to open Ai. But
Open Ai can't use that money and go do whatever
they want to do. What do they have to do.
They've got to turn around and buy a million dollars
worth of Navidia chips. So yeah, you used to see
Jason's look on his face. Yeah, that's what I mean.
Circular account Jason, think about this from an earnings per
(30:42):
share standpoint. What if this sec or somebody wakes up
when day and goes is this kind of yeah, mickey
mouse accounting, It's like you're almost paying for your own
earnings numbers.
Speaker 3 (30:54):
That's what the issue with SMC I was remember that
stock super micro right where that thing got destroyed because
they were you know, people thought they were doing that
within video and there were all these other companies that
people were writing articles about where you know, they sort
of existed in order to buy in video chips in
countries that couldn't buy in video chips and ship them. Like,
(31:17):
there's a lot of that concern. I would agree with you,
and almost like a mortgage backed security, you know, triple
leverage clos that we had back in the day, when
you're like, wait a minute, the same thing's happening multiple
multiple times. Here product right exactly and your counting iss
earnings exactly. And so that agreed could certainly become a
(31:39):
problem in the future if there's a circular reference error
of some kind where your Excel freaks out and says,
uh uh no, but the market right now doesn't seem
to be ready to do that yet.
Speaker 1 (31:50):
No. No. But you know, Dennis, you all three of
us were chatting during the break, and you're absolutely right
on this point. And that is what's the risk of this, right,
you're not a stock marker guy anymore, but you were
for many years. And yeah, you're looking at it not
only from the textandpoint, but the risk standpoint. We all,
all three of us lived through the dot com bust, right,
nothing could go wrong, Everything's going to go uh, this
thing is never going to stop. And then all of
(32:12):
a sudden, you know, those those illustrious words by Alan Greenspan,
irrational irrational exuberance, and that's all it took and the
whole house of cars came crashing down. Are we at
risk of something like that with this? Because you know, Jason,
you said the same thing. Technology changing so fast, we
got quantum computing coming could we in five, ten, ten years,
(32:32):
I don't know, let's go ten years. Could these data
centers that are costing billions and billions? Could they be
nothing more than a big bunch of concrete walls and
you know, almost looking like KT Yeah, yeah, exactly, what's
kmart centers? Roebucks that type of thing.
Speaker 3 (32:46):
And I've seen some negative pieces about right, I think
of how quick technology advances, like the fact we went
from this chip set to this chip set to this
chip set in video that if they've got an even
five year shelf, I mean, heck, five years ago, what
even was AI in the way that we know it now?
So imagine the chips now five years from now and
(33:08):
the cost that they are, right versus the revenue that
a data center makes. I've seen numbers where essentially the
costs are two x what the data center will even
make over that period of time. And you're like that
math doesn't it's not mathing right, Like, so that's why
and Nvidia says, hey, we'll give you money for you
to buy our stuff for X number of years in
(33:30):
order to Hey, we have our tentacles in you and
you're not going to go to a MD or to
whoever else and it yeah, it's it. At some point
the math won't math right. But for now, like we'd said,
there's still enough of a runway that I think there's
still time to the story for sure.
Speaker 2 (33:47):
Absolute you want to anything to that, No, I just again,
I'm stuck on the end. It's probably pretty dumb for
me to say this. With the antiquity of this model.
We're still talking about chips, power, cooling, construction, the same
elements that we were talking about. We were building data
center twenty years ago, same thing, larger scale, got the.
Speaker 1 (34:12):
Small nuclear nuclear nodes that the US supply the power.
Speaker 2 (34:16):
So that that concerns me and it kind of begs
for another solution to emerge, which would just really annihilate,
right model.
Speaker 1 (34:27):
Well, I mean, what if just you were talking about
quantum competing, right, which we don't try to get into that,
but that's kind of like kind of quote the next
generation of what that with computing is going to do
is to the quantum computing. What if there was one
massive data center that hows you said you saw one
on your trip to New York. That was what in
a church you said.
Speaker 3 (34:45):
Oh so yeah, so this is it? Rensally or Polytech.
This is the school. My youngest son wants to go
to RPI in upstate New York and they have an
IBM quantum computer there and it's the size of you know,
I don't know twenty that big, but yeah, I mean
that those are what will be the next generation of
speed and compute where you don't need as much storage
(35:09):
right as we have now, So it technology will advance
in just a matter of yes, are you buying the
beta or are you buying the VHS?
Speaker 1 (35:18):
Right? And we'll see. Well in the meantime, what are
the benefits that we can all take advantage of? And
again there's no stock recommendations here, but just things for
you to be thinking about. Right, So how does this
whole situation potentially benefit us? Well, first of all, we've
got the stock market impact, right, the names that we
talked about all the time. Then the video is the
Oracles et cetera. AI related stocks you know, continue to rally, right,
(35:41):
we'll continue forever? Absolutely not. Do you have some chance
to potentially make some money down the road? Maybe so?
Or when I say down the road, maybe at any point.
So diversified portfolio, but you know, do you you know
based upon your risk and goals, you should be considering
an allocation to AI and all the infrastructure. We talked
about tech revolution again, just about the chips. We're talking
about reshaping economies right as becoming a critical for electricity,
(36:04):
the adoption really, how it's going to transform our daily lives,
the investment opportunity again, different companies tied to the AI infrastructure.
You look at semiconductors, cloud, the different data centers. Again,
this is kind of the picks and shovels play of
the gold Rush. So there's a lot of different ways
that you can play this and as always, be cautious
about this whole situation because you never know when things
(36:25):
can change. Is the boys just got done, Sam, that's
a lot of fun boys. Thank you so very much
everybody for joining us. We do appreciate it. We'll do
it again tomorrow on the John Sanchez Show. God bless,
have a great afternoon. John Sanchez is a registered investment advisor,
and the opinions expressed by Sanchez Gone Capital Management, LLC
on the show or their own and do not reflect
the opinions of News Talks seven eighty or its pairing company,
(36:46):
Cumulus Media. All statements and opinions expressed are based upon
information considered reliable, although it should not be relied upon.
As such, any statements or opinions are subject to change
without notice. Information presented is for educational purposes only and
does not intend to make an offer or solicitation for
the sale or purchase of any specific securities, investments, or
(37:07):
investment strategies. Investments involve risk, and, unless otherwise stated or
not guaranteed, information expressed does not take into account your
specific situation or objectives, and is not intended as recommendations
appropriate for any individual. Listeners are encouraged to seek advice
from a qualified tax, legal, or investment advisor to determine
whether any information presented may be suitable for their specific situation.
(37:31):
Past performance is not indicative of future performance.
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