Goldman Sachs Leads the Charge in Nvidia's AI Financing Consortium

Nvidia's US$500bn AI financing consortium has some notable absentees, particularly JP Morgan. Goldman Sachs is the only bank in the consortium and its CEO David Solomon played up his bank's role in the initiative.

The absence of JP Morgan, the world's most valuable bank and global leader for investment banking revenue, raises questions about whether it was deliberately left out or simply took a different approach to AI funding risk. JP Morgan did not respond to queries about discussions with Nvidia before the launch of the platform.

Goldman Sachs' involvement in the consortium may signal that it is taking a more aggressive approach to AI funding than its rivals, including a willingness to take on more risk. This could be part of Goldman's efforts to reinvent business practices from before the 2008 financial crisis, which saw the bank shrink its balance sheet and reduce leverage.

Nvidia CEO Jensen Huang said that his company's 'compute' is an investable asset, and the AI financing platform aims to promote this idea. However, critics warn about the circular nature of the AI financing market, where companies may create layers of credit exposure based on the same underlying risk.