CONCEPT
Vendor Financing Loops
The circular financing structure characteristic of mature manias — Nvidia finances OpenAI, which buys compute from Oracle, which orders chips from Nvidia — a structure Kindleberger documented in the South Sea Company and Japanese keiretsu.
The circular financing structure that emerged by late 2025 in the AI industry would have particularly interested Kindleberger, who spent decades documenting the self-referential credit mechanisms that characterize the mature phase of manias. The structure was described in financial commentary with unusual bluntness: Nvidia finances OpenAI, which purchases computing power from Oracle, which orders chips from Nvidia — a loop in which each participant's revenue is, in significant part, another participant's expenditure, funded by capital raised on revenue projections that depend on the continuation of the loop. Commentators described it as 'far beyond a pyramid scheme; a perfect financing circle, all based on a sea of debt.'
In The You On AI Field Guide
Kindleberger documented structurally identical mechanisms in the South Sea Company's share-buy-back schemes of the 1720s, in the cross-holdings of Japanese keiretsu before the 1990 crash, and in the SPV structures of the pre-2008 credit bubble. The sophistication of the mechanism bears no relationship to