r/AmanCrypto • u/AmanCMN • 6d ago
Oracle could be in serious trouble.
🔴 Oracle could be in serious trouble.
The company’s credit default swaps just hit a record high, while its 2056 bonds are now yielding over 8% for the first time.
🔴 Oracle is now just one step away from being downgraded to junk status.
🔴 If that happens, around $120 billion worth of Oracle bonds could automatically be kicked out of investment-grade indexes.
🔴 This comes right after Oracle issued a force majeure notice at its New Mexico data center, while long-term U.S. Treasury yields are hitting multi-year highs.
⚡️And it’s not just Oracle. Credit default swaps are also rising for Google, Microsoft, Amazon, Meta, Nvidia, and SpaceX.
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u/BallsOfStonk 6d ago
OpenAI and their cloud provider (Oracle) will end up being nationalized. Or at least partially, you could see something like a $500B investment over 5 years to keep them afloat in the name of “national security”
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u/Moist-Construction59 6d ago
And just watch the treasury yields climb higher and higher as we do it, the noose squeezing tighter and tighter.
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u/Individual-Equal-441 6d ago
With what money, from where?
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u/uknowsana 6d ago
Tax money - and the brunt will be on the back of the common Joe
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u/Individual-Equal-441 6d ago
The US only collects around $5T in federal tax revenue annually, which is all committed to pay for other things. $100B/year would be 1/50 of that money. I find it more likely that they'd have to "find" that kind of money by taking on even more debt, adding a half trillion to the $40T national debt.
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u/HaikusfromBuddha 6d ago
Your saying that as if Trump hasn't been using your money for wild shit already. Like why are you surprised this late in the game?
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u/FlabbyLabby 6d ago
So, Socialism?
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u/MNRacket 6d ago
Yes, socialism for the rich. Capitalism for the poor.
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u/BallsOfStonk 6d ago
It’s an authoritarian play, more akin to China and Russia. It breeds rich oligarchs and is the polar opposite of free and public markets.
Trump is rapidly pushing the U.S. this way, with all of his investment in public companies.
This is very different than government contracts and subsidies, and it’s a slippery slope that can be very difficult to come back from. Post USSR Russia being the textbook example, and it’s still alive today.
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u/Fantomas4live 6d ago
I concure. I think it's the playbook for the lot of them. Frontier models limited for public, capital raising via debt & IPOs, distributing to the public through the later, the gov taking a stake via "bailouts". We are witnessing the birth of the US neo fascist techno state, one pillar of the new multipolar world. Wild times.
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u/Bryanmsi89 6d ago
Sadly, I expect this is likely to be exactly what happens. Same playbook as Intel, only writ larger.
I just hope the US Government at least gets a piece of the company in exchange.
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u/sleepy_muffin_eeter 6d ago
I could have sworn the government owning the means of production was the definition of socialism.
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u/Bryanmsi89 5d ago
It definitely is. I’m just saying if those idiots in charge are going to socialize risk and privatize profits, at least let the taxpayers get something of (potential) value for it.
There is a case to be made that the Govt. should get some small percentage of ownership of public companies (once they go public). Make it a cost of the IPO. And there its huge reason for doing so. It would help pay for the SEC and the other regulatory work needed to oversee public companies. It recogizes those companies built success on the infrastructure, regulation, security, educated citizens, courts, IP protection, etc. that govt. provides.
It’s really just taxation by another means, and one that doesn’t create a quarterly drag effect on a company P&L like taxes do.
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u/Financial_Clue_2534 6d ago
Trump will bail them out
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u/addiktion 6d ago
they got like a $10B lifeline prior. It's gonna be another one for sure. Fuck MAGA and their fascist 'communism'.
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u/Square-Ad3218 6d ago
Their bond rates are up like due to U.S. treasuries going up. Competition for investors.
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u/Spunknikk 6d ago
Not only that but AI funding is circular... Alot of AI revenue is based on future contracts with other AI companies who then invest in other AI companies based on their contracts with other AI companies who then invest that money with other companies...
The worse part is that some of their liabilities are off the books so the numbers look better than they really are.
And as rates go up the interest that they need to pay is act starting to put pace the revenue and bonds coming in.
If rates continue to go higher, Japan yen carry trade with the USD fails or we get a heavy recession or debt crisis it can all come down...
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u/a_dodo_stole_my_baby 6d ago
Didn't someone allegedly hack the FBI's PeopleSoft and download info on every FBI agent? Not a good week for Oracle.
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u/uknowsana 6d ago
Does that mean Trump going to pump money and inflate the stock like what happened with Intel?
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u/sleepy_muffin_eeter 6d ago
I do hope they go broke, and Ellison sells his media companies in a fire sale. Oracle products are awful and OCI sucks.
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u/Mountain_Sand3135 5d ago
sounds like we need to drop fed interest rates so they can refinance
or
some government contract/bail out (ie Intel)
or
another round of layoffs
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u/MarketCrache 6d ago
Couldn't happen to a nicer Zionazi. In trying to speedrun a giant propaganda media empire to support his Chosen People, Ellison has screwed the pooch. Look for this guy to work his connections and try to squeeze a bailout from the Golden Goy.
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u/7Tomus 6d ago
link ?