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This is a segment from The Breakdown newsletter. To read full editions, subscribe. “A pin lies in wait for every bubble. And when the two eventually meet, a new wave of investors learns some very old lessons.” — Warren Buffett Markets were down this week, possibly because GPUs are starting to go dark. In Oregon, for example, three of Amazon’s new data centers are sitting idle because the local utility company refuses to connect them to the power grid.  That leaves thousands of cutting-edge GPUs, likely costing hundreds of millions, sitting idle as well — aging in place without making any return on the giant investment they represent. Microsoft is having the same problem.  Satya Nadella says the “biggest issue” that Microsoft is now facing in AI is “a bunch of chips sitting in inventory that I can’t plug in.”  “It’s not a supply issue of chips,” he adds. “It’s actually the fact that I don’t have warm shells to plug into.” The “shells” Nadella’s referring to are data centers and they’re not warm because they’re not connected to a source of power.  There are many such cases. “The infrastructure has now been outpaced by the construction of facilities,” Kristin Hammond of CBRE explains. “There’s no use to having the facility if you don’t have the power poles to service it.” But we’re still constructing the facilities. Spending on data centers is on pace to double this year vs. last, and the pipeline of proposed projects is growing even faster than that. This might be starting to sound familiar.  For stock market investors, data centers going unused for want of power should evoke memories of 1999, when an estimated 97% of fiber optic cables that investors were frantically funding remained “dark,” or unused.  The analogy is not exact: It was…

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Filed under: News - @ November 14, 2025 11:22 pm