CNBC: Jon Gray on Investing in the AI Buildout 

Becky Quick: Is there enough money in our capital markets to handle this and is it profitable for the investors? Who wants to take it, Jon why don’t you jump in on this. 

Jon Gray, Blackstone President & COO : Sure, I would say, first off, it’s great to be here. What Jensen has built is incredible. What I would say is, our markets are large and it’s one of the great strengths when we talk about America. When you look at our ability to finance $700 billion dollars a year in automotive or a couple trillion dollars a year in housing. I think we’re going to see a similar dynamic. And what is supporting it is supply and demand. So today at our companies, we’ve seen a 7x fold increase in demand for LLMs in the last six months, and yet the amount of compute is not keeping up. The data centers, the power, the chips. And so what you’re going to see here is people are going to begin to recognize that this is a financeable asset class. So when you think about your home, you know when you go to buy a house, the bank underwrites you, but they also look at the value of your home. When an airline goes to buy a plane, they look at the credit of that company but also the plane. I think historically here the limitation has been investors have said oh I only want so much exposure to this hyperscaler or maybe to this foundational model company. I think when people recognize how powerful and valuable this compute is, no matter who is using it, and in Jensen’s case, they’ve got very fungible, flexible capabilities with their GPUS and the Cuda software. So, what I think is markets are going to recognize the opportunity. If the scale gets very, very big, which it is, pricing could widen out, but I think in the fullness of time the recognition of the supply demand imbalance and the value of the compute is going to draw capital in.

Disclosure:

Neither this video nor any of the information contained herein constitutes an offer to sell, or a solicitation of an offer to buy, any security, Blackstone fund or other investment vehicle or strategy. Past performance does not predict future returns, and there is no assurance that any Blackstone fund will achieve its objectives or avoid significant losses. This video may contain forward-looking statements, which are subject to various risks and uncertainties, and actual events or results or the actual performance of any investments may differ materially from those reflected or contemplated herein. Statements contained herein are based on current expectations, estimates, opinions, and/or beliefs of Blackstone or third parties as of the date of the recording and should not be construed as research or investment advice. There can be no assurance that views and opinions expressed in this recording will come to pass and are subject to change. There can be no assurances that any of the trends described herein will continue or will not reverse.
 
For information about Blackstone's business, including risks and financial information, please refer to our most recent Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission.  Additional information is available here at http://ir.blackstone.com. This video is owned by Blackstone and may not be downloaded, recorded or reused in any way without Blackstone’s express consent.