Summary
Darren Wilson’s BBB Postcard #36 dissects the AI narrative, highlighting four critical unaddressed areas by mainstream Western media: super-intelligence (model layer), AI infrastructure (land play), rare earths geopolitics, and energy consumption. He frames the current AI tech rally as a “Jenga tower” with structural dependencies, arguing that interdependencies between the US and China will necessitate cooperation, or China could become entirely self-sufficient in AI within a decade. The piece implicitly questions the sustainability of the current AI-driven market bubble and its parallels to historical manias like the 1800s railway boom.
Key Claims
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “Chinese open-access websites… trained many of these Western [AI] models.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “Data centers are driving some of the hottest land markets globally.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “Nvidia’s valuation matches the GDP of a mid-size country.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “US infrastructure has a massive supply-chain bottleneck — transformer lead times of 3–5 years, gas turbines taking a decade, and 8,000 transformers already imported from China. Without Chinese involvement, the US can’t build fast enough.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “China controls gallium nitrate and most heavy rare earths through a single mine (Bayan Obo, Inner Mongolia).” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “Pentagon is now making direct equity investments in rare earth miners after 15 years of failed attempts to build supply chains outside China.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “China has more renewables than Europe, UK, and US combined.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “US grid is at breaking point; China is the world’s dominant clean energy exporter.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “The current AI tech rally is a Jenga tower…pull one brick…and the whole thing comes down.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): “It’s not a clear US win — it’s a tie at best. The interdependencies between the US and China will eventually force cooperation to advance AI meaningfully.” — confidence: high
- 2026-06-05-bbb-postcard-36-ai-media (2026-06-05): Analogizes current AI boom to “the railways back in the the 1800s…everyone piled in…then one day someone decided to see if the sums added up. And when they don’t, you get the almighty crash.” — confidence: high
Predictions / Forecasts
- If US-China cooperation doesn’t happen and China goes it alone, “in 10 years they may not need the West at all.” — confidence: medium
- One day, investors will realize there’s “no return anytime soon” for the money poured into AI CapEx, leading to an “almighty crash.” — confidence: medium
Concepts Referenced
- AI Bubble
- US-China AI Competition
- 18.6-Year Real Estate Cycle
- Rare Earths Geopolitics
- AI Energy Demand
- IPO Mania
- Winners Curse Phase
- Geopolitical Cycle
Notable Quotes
- “The biggest potential drag we have is not having enough electricity to power our data centers.” — Hank Paulson
- “It’s not a clear US win — it’s a tie at best.”
- “In 10 years they may not need the West at all.”
- “What precisely are investors paying for with these incredible multiples for AI-related stocks?”
- “When’s our return?”
- “One day we’re all going to wake up and realize there’s no return anytime soon for the money put in.”
- “This could very well be the tipping point that precedes an almighty crash as all the heat in that bubble rapidly escapes.”