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Bond King Jeff Gundlach questions Nvidia’s $500B AI financing plan
Gundlach criticized the use of assets of unknown life as collateral in the initiative announced with major Wall Street banks and Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR.
Jeff Gundlach, founder and CEO of DoubleLine Capital, said he is skeptical of Nvidia’s recently announced effort to jointly finance the AI boom with Wall Street’s biggest investment banks, a plan described as involving $500 billion of capital.
In commentary on X, Gundlach argued the arrangement is unlikely to age well and questioned the logic of using assets of unknown life as collateral. He drew a comparison to issuing an asset-backed securities deal backed by bananas, noting the assets would be newly engineered but still of uncertain life.
The initiative was announced after Nvidia CEO Jensen Huang said the group would help create a new class of productive, investable infrastructure, describing AI compute as revenue and positioning the financing as a way to underwrite AI data center buildouts.
Yahoo Finance reported the deal is aimed at funding data centers, servers, and cooling systems that support the AI boom, and it names Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR among the partners. Gundlach, nicknamed the Bond King for his mortgage-backed securities trading background, manages $95 billion in financial assets, including residential mortgage-backed securities. The report also links his skepticism to lingering concerns in investment circles about whether AI financing can prove profitable, especially as customers face difficulty lining up financing for Nvidia chips.