GOLDMAN SAID THE SAME THING RIGHT BEFORE 2008

"Carnage" — the word from inside

Felix calls this "the most important video in six years," and the trigger is a single word. Goldman Sachs — which he describes as the most important investment bank in the world — sent its traders an internal note describing conditions in AI credit as "carnage". It's the same word Goldman used in 2007. Around the same time, the Financial Times reported that banks were quietly dumping AI debt, and bonds bought by ordinary Americans — including a $25 billion SpaceX bond sale — had gone underwater, losing roughly 10%.

His one-line summary of why this matters: "The bond market doesn't tweet. The bond market just does maths." Stock prices are opinions; bond prices are arithmetic. And the arithmetic of AI credit is starting to look ugly.

The circular money machines

The core of the video is the claim that the AI boom is funded almost entirely with borrowed money in circular deals — a structure Felix says is bigger than 1999 and 2007. The scale: Amazon, Meta, Nvidia, Oracle, Alphabet, and SpaceX have borrowed more than ever before, and roughly 1 in 5 dollars lent in America now funds AI. Your exposure is probably automatic — 401ks, target-date funds, and pensions hold these bonds by default, because bonds are IOUs that retirement funds buy as a matter of course.

Then the circular machines. Nvidia invests billions in AI startups that turn around and buy Nvidia chips — booked as booming sales, though as Felix puts it, "the money never left the building." Microsoft's $13 billion into OpenAI flowed back as cloud purchases. Google and Amazon's billions into Anthropic returned as cloud revenue. He even performs a 50-euro skit with his dog Winston to demonstrate how made-up revenue can loop in circles and look like growth.

The damning statistic comes from Apollo: there is zero extra AI profit outside the tech sector. Trillions of dollars in market value rest on the belief that AI will make every business profitable — yet the only companies profiting from AI are the ones selling it to each other. It's the 1999 pattern exactly: back then, only internet companies selling to internet companies profited, and the NASDAQ fell 78%.

The 2007 playbook, replayed

The parallel Felix draws is deliberate and detailed. In 2007, housing looked unstoppable — prices rising monthly, record bank profits, "housing only goes up" — built atop a borrowing machine that packaged loans into bonds and sold them to retirement funds. Until buyers said "no more." The AI version: borrow, build, borrow more.

And the behavior rhymes too. In May, the FT quietly reported that JPMorgan and Morgan Stanley were chopping AI loans to sell them off — and 48 hours later, Goldman published euphoric public research on AI. In 2007, banks hedged their housing exposure privately while selling it publicly; Goldman later paid the SEC $550 million over it. Now, a Goldman head trader privately admits credit-desk "carnage" while the public research glows. The borrowing volumes tell the same story in numbers: $75 billion in February → $50 billion in June → $25 billion in July. The buyers are saying "no more" in the data, whatever the research notes say.

Five dominoes to your pension

Felix lays out five dominoes connecting all of this to an ordinary retirement account: lenders walk away → debt costs more → the $5.8 trillion in planned AI spending is at risk → circular revenue evaporates → stocks fall (the Magnificent 7 are roughly a third of the S&P 500) → retirement gets hit twice, through stocks and through "safe"-rated bonds — which is exactly how subprime worked.

He's careful to say this isn't panic: the technology is real, the chips work. But the funding and the concentration mirror the three episodes that crushed ordinary people. Apollo's warning gives it a number: a mere slowdown in AI spending — not a crash, a slowdown — means recession and a roughly 30% S&P correction.

His three questions for the viewer: how exposed are you? Is your retirement holding these bonds? And what's your plan when the spending slows?

The takeaway

Felix closes with the line that runs through all his work: "Every bubble rewards the people who prepare and punishes the people who assume someone else is watching out for you. No one's watching out for you." The bond market has done the maths. The only question is whether you've done yours.