I used to think the same way wrt Nvidia stock when it tanked - compute is clearly diminishing returns. Tech companies subsequently announced capex equal to or greater than expected in compute. I smacked myself on the forehead when I realized - I'd been think too much like an engineer. Tech CEOs badly want to believe they have an edge over every upstart from San Francisco to Shanghai. Unlimited spending on compute gives them that reassurance. In fact, the more threatened they feel, the more they spend to cling onto it.

Kids have security blankets. Tech CEOs have security compute clusters.