How to Make Money From the Booming Demand for Energy

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Odd Lots 53 min 7 speakers 8 chapters transcribed 1 month ago
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What is the main topic discussed in this episode?

Jennifer Zabasaja 0:00
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Nathan Hager 0:18
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Jennifer Zabasaja 0:32
Bloomberg Audio Studios, Podcasts, Radio News.
Joe Weisenthal 0:48
Hello and welcome to another episode of the Oddlots Podcast. I'm Joe Eisenthal.
Tracy Alloway 0:53
And I'm Tracy Alloway.
Joe Weisenthal 0:54
Tracy, I saw an interesting headline this morning. Just one? Ha good point. I saw a million interesting headlines, but one that sort of caught my eye and was sort of market moving. Is uh there was this comment from uh Jensen Wong, he was at a conference, the CES conference, and he was talking about how in the future, I guess their chips are getting more efficient as chips tend to do, that they may not need as much intense cooling infrastructure or for cooling equipment for future data centers. And a bunch of those like cooling names, like train technology, they're like really getting clobbered because we know those have been like some of the big winners from the AI boom.
Tracy Alloway 1:29
I can hear all the private equity shops that bought HVAC uh outfits screaming from over here. No, it is a really interesting headline, right? Because you think about this as a technology space. Yeah. AI is technology, but it has this huge infrastructure aspect attached to it. Infrastructure investors, from what I understand, you know, historically have tended to like relatively stable returns, right? You invest in it. Because you expect this to be a pretty reliable business. But because you have infrastructure that is now tied to tech, it seems like there's a pretty big risk that like every year or every two years or maybe even months now, there's gonna be some huge tech upgrade that just changes the equation entirely.
Tracy Alloway 2:02
It seems like
Joe Weisenthal 2:11
This is a good point. Like I think like the first time years and years ago I started hearing about infrastructure investing, it was like, oh, we bought a toll road. Right. Or we bought an airport. And airports, by and large, they don't get disrupted very much or a toll road. Like the the basic business of some of these things has remained stable. But yeah, to your point, especially now that there's such a link with tech, just like the sort of volatility of what's gonna win. Or what's needed seems seems highly uncertain.
Tracy Alloway 2:38
Yeah. And of course, the other obvious thing going on at the moment is everyone's talking about AI valuations. Is the build out getting ahead of itself? And are all these companies actually gonna be able to generate enough cash flow that backs up all this investment spend?
Joe Weisenthal 2:52
You know, the other thing too, and it's something that we've observed, which is if you go back to Like infrastructure investing is not a new thing by any stretch. But you go back to the 2010s and so much of the money that was made then is sort of like financial engineering, financial opportunities, who had dry powder at a time when everyone is broke and so forth. And one of the themes that's recurring over and over again these days is just like To make money, it feels like you really have to get your hands dirty. Physical things of all sorts. And physical things have just been in our face constantly since COVID. And then it's accelerated because of there's so much public money pouring into the space.
Joe Weisenthal 3:30
So governments around the world really opening up the taps.

What is the main focus of the episode and who is the guest?

Joe Weisenthal 3:34
And then over the weekend, we're recording this uh January 6th, by the way. Obviously the Maduro news. And so then there's all this. It's like, oh, who's gonna rebuild all of that oil infrastructure if that oil is ever going to profitably be tapped? Like this is just sort of the physical world is sort of like the story of our time.
Tracy Alloway 3:53
Are people talking about public private partnerships yet?

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