ray

[Arnaud Bertrand @RnaudBertrand]

This is absolutely brilliant, by legendary Australian investor John Hempton, who explains the core financial paradox at the heart of the AI story (and which also, to some extent, may explain the Jensen Huang story).

The numbers say that about $7 trillion in AI compute is set to be built by 2030. For the industry to earn that back, given those chips have a roughly 5-year lifespan and cost a lot to run, they need to generate about $2 trillion of AI revenue a year.

Hempton says the only way you can get to these sorts of numbers is by selling AI as a productivity tool to businesses, meaning replacing workers.

And since, for reasons he explains in the video, no company fires people to save just 10% in costs, the savings have to be about double what businesses pay for the AI: roughly $4 trillion in savings on wages a year.

What does firing $4 trillion worth of workers mean concretely? Hempton calculated this equates to roughly 10% of the OECD’s total wage bill of about $40 trillion: one in every ten dollars paid to workers across the OECD’s 38 member countries.

Which, naturally, when you suddenly take that much income out of people’s pockets, would trigger a massive global recession.

And here's the paradox: in a massive global recession, there's no way businesses will pay $2 trillion a year for AI, so the return disappears anyway.

In other words, AI's only possible path to success given the numbers requires destroying the very economy that is supposed to pay for it.

HOWEVER - and here's where the Nvidia/Jensen Huang story might come into play (and, to be clear, this is now me speaking and not Hempton given this interview is prior to the whole Nvidia saga) - this all rests on a core assumption: that compute stays super expensive. Which in practice means Nvidia keeping its pricing power, with a 75% gross margin on its chips.

Break Nvidia's pricing power, and the $7 trillion bill, the $2 trillion in revenue and the 10% of jobs all shrink with it.

This would also put the whole China story in a different light. Maybe it's not so much a "we don't want the Chinese to be competitive with similar chips to us" story as it is a "we don't want Chinese demand to drive up chip prices" one. Or probably both.

And, as such, you could actually think about the US export controls not as a national security measure but as a good old subsidy for US AI players (together with a handicap for their Chinese competitors), a way to limit the price of chips.

This holds even with China itself blocking Nvidia imports, since Chinese firms simply rent the chips abroad instead, in places like Southeast Asia, which is precisely what this whole Alice Huang/Megaspeed story is about.

The main obstacle for all this was, of course... Jensen. Obviously, the guy wanted the exact opposite: as many buyers as possible, Chinese players included, to keep chip prices and Nvidia’s margins sky-high. He was also the one man with the clout to make that happen.

All hard to prove, of course, but I can imagine that quite a few corks popped this week in Anthropic's offices: nothing like the news that the man keeping your biggest cost sky-high is out when you're a week away from a $1.2 trillion IPO.

[David Marler @Qldaah]

NSW Former Liberal MP Rory Amon has been found guilty of the rape and indecent assault of a 13-year-old boy in 2017, after meeting him on a dating app. #nswpol https://t.co/91C3u7jAam

[Peter Fox 🦊 @Peter_Fox59]

Former NSW Liberal MP Rory Amon found guilty of raping 13yo boy - ABC News https://t.co/jB1XIAHpTu

[Peter Fox 🦊 @Peter_Fox59]

Former Liberal MP Rory Amon found guilty of raping 13 year old boy in toilet https://t.co/XxwxtJj1bk

[Steph Hodgins-May @stephhodginsmay]

BREAKING: And the sky is blue.

Who is surprised by this? Labor has accepted MILLIONS in donations from fossil fuel corps while opening 38 new coal and gas projects while in office.

Labor can’t ever be trusted on climate. The Greens will replace them.

https://t.co/pmywEsJVo1

[Jenny Difficult-Frecklington-Jones 🇵🇸🇱🇧🇮🇷 @JonesHowDareYou]

"The people of Gaza have lived through years of genocide and are now facing life threatening flooding. While Israel blocks the emergency aid needed to keep people alive."
— David Shoebridge

#auspol #VoteGreen

[Glen Schaefer @hardenuppete]

oh the poor darlings 🥲

Some homeowners are having to sell their second and third properties to pay off their mortgages.

https://t.co/KmMWOZIlWC

[Rrockstar @Rrockstar10]

@jommy_tee This @AlboMP government is so secretive that I long for the simple days of 5 hidden ministries. 😬

[Jommy Tee 🌐 @jommy_tee]

According to the released records, Society Advisory’s services are to be delivered through a "proactive, embedded function.”

Another day, another transparency and accountability fail.

[Jommy Tee 🌐 @jommy_tee]

Payment terms: The contract price and payment schedule were also redacted.

In a separate response to a Senate estimates Question on Notice, the Department confirmed the contract operates via equal monthly payments tied to "continued performance against the requirements."

[Jommy Tee 🌐 @jommy_tee]

The released copy of the contract is heavily redacted, obscuring major details of the taxpayer-funded arrangement.

Scope of work: The section detailing the "scope of support" was blacked out, leaving it unclear what specific deliverables Society Advisory must provide.

[Jommy Tee 🌐 @jommy_tee]

Despite the lack of documented evidence, the Department maintained that "targeted market research" had identified Society Advisory as the "only suitable supplier."

[Jommy Tee 🌐 @jommy_tee]

At Senate estimates hearings, officials said Segal’s market research for the contract consisted of taking direct soundings from the Jewish community.

However, the FOI request sought access to that research, the Department refused, stating that "no discrete documents exist."

[Jommy Tee 🌐 @jommy_tee]

The FOI documents and decision letter indicate that the procurement process relied on (undocumented) confidential discussions.

This raises concerning questions about how the supplier was selected.

[Jommy Tee 🌐 @jommy_tee]

The firm was also tasked with developing a comprehensive public affairs program to build credibility for Segal’s antisemitism plan among key sector influencers and decision-makers.

[Jommy Tee 🌐 @jommy_tee]

Under the terms of the 12-month deal—which includes an option to extend for a further six months—Society Advisory is engaged to provide PR and communications support for Segal’s office, including assistance with her engagement with the Royal Commission.

[Jommy Tee 🌐 @jommy_tee]

The following morning, Segal instructed her staff to draft a contract with Society Advisory, requesting it take effect on the following Monday.

A draft contract was sent to Finkelstein late Mon April 13 and he formally signed the agreement on Wednesday, April 15.

[Jommy Tee 🌐 @jommy_tee]

On the evening of Thurs, April 9, 2026, Yaron Finkelstein, founder of the firm Society Advisory, sent an email to Segal with the cryptic subject line "As Discussed."

The contents of the email released following a 6-month FOI process, were blacked out in their entirety.

[Jommy Tee 🌐 @jommy_tee]

THREAD:

Email one day, $198,000 contract the next: How a PR deal was struck behind closed doors.

Docs released under FOI reveal a $198,000 public relations contract was initiated less than 24 hours after a single email was sent to Special Envoy Jillian Segal.

[Peter Cronau @PeterCronau]

🚨LEAK🚨 Israel’s foreign minister lets slip that Australia’s crackdown on free speech is not about ‘antisemitism’, but is about preventing criticism of Israel.

“I want to praise the change in legislation in Queensland designating some anti-Israeli slogans as criminal.”

Sa’ar urged on the Zionists Federation of Australia:

“I think it is crucially important and to the extent that you can influence other districts or states in Australia to do the same, that would be blessed.”

https://t.co/T7BTgpHSJs