How China and Trump Will Defeat Silicon Valley

Today, at last, is my 37th birthday. I’m surprised I made it this long, to be honest. My friends and I went out for Turkish breakfast and I’m so grateful to all of you who have supported me and this Substack over the years. Thank you.

Rumor has it that Donald Trump and Xi Jinping are planning a grand bargain for early next year and I, for one, am here for it. In fact, I think it signals the beginning of the end of Silicon Valley, and with it, a new technological age based not on energy-intensive LLMs but on cloud technology.

I suspect we will see the collapse of Elon Musk and his cronies, too, and that the recent departure of Sequoia’s COO Sumaiya Balbale was a testament that the Gulf Arabs aren’t going to accept the Islamophobia so common among Zionists in Silicon Valley. Given there hasn’t been a lot of liquidity here, there are going to be a lot of changes.

There’s already some inclination that that’s going to happen. I think the election of Mamdani will be a watershed moment where a lot of the Middle Eastern sovereign wealth funds will realize that they don’t need to accept the Kushners, Steve Witkoffs, and Sam Altmans of the world.

You can very easily imagine a Non-Resident Indian (NRI) who is Muslim, cutting a deal with the cash rich sovereign wealth funds of the Middle East to buy up the various real estate properties in New York once the Jewish power relocates from New York to Florida and Texas.

Besides, do you really think that all those Muslim sovereign wealth funds are going to allow the first Muslim mayor of a major American city like New York be a failure? It’s hard to see. In a way, Eric Adams tried this approach a little too early when he got into bed with the Turkish property developers. In the future Adams will be seen as a visionary and it’s a shame he’s not going to be mayor. At least he can content himself with being rich.

*****

Now I’ve never been one of these anti-Chinese types. If anything, I’m pro-C.C.P. and anti-Triad. I had occasion to run into some of these Triad types in Southern California and Hong Kong and frankly, they are extremely disturbing to me.

What if these operations were really about taming Sam Altman rather than any real bet that A.I. is real? Could it be that Larry Ellison, in negotiating with Altman, was, in fact, watching what Altman was really getting into?

What if the infrastructure needed for “A.I.” was really about setting up places for cloud infrastructure? What if the plan was to drive up energy prices for their petrostate investors?

There are different models that are possible — China provides an answer and can more cheaply do a lot of what Altman is purporting, though how much of one I couldn’t say.

I think it’s becoming clear that the cloud is more important than A.I. The real winners lately are AWS, Microsoft, and Oracle among others. Doesn’t it seem as if there will be a commodification of cloud storage? What if all this data center stuff is really about creating the places where all of our data is stored?

And when that happens, might Signal’s Meredith Whittaker be right when she says, “I see AI as born out of surveillance”?