Subject File 03: Ellison, Lawrence Joseph

A working dossier of the Center for Intergenerational Settlement. Subject Files are issued under the authority of the Standing Committee on Cohort Liability and supplement the Center’s general findings on demographic balance-sheet settlement.

Summary

The Subject is, at age 81, the principal individual beneficiary of the largest capital-allocation event of the present century. Oracle’s market capitalization has approximately tripled since 2023, an appreciation of which approximately $200 billion accrues to the Subject’s personal holding. The appreciation is attributable, in the assessment of the Subject’s own analysts and of his sell-side coverage, to a single announcement: that Oracle, on behalf of OpenAI, would construct a campus of data centers in Abilene, Texas, under the project name Stargate.

The Subject delivered this announcement, in the East Room of the White House, in January 2025, beside the chief executive of OpenAI and the President of the United States. The announcement specified an investment figure of $500 billion. The figure was not the Subject’s to commit. The figure has not, as of this writing, been committed by any identifiable party. The data center campus, at the time of the announcement, did not exist. At the time of this writing, two buildings of the planned eight have entered partial operation; the contracted expansion of an additional 600 megawatts has been cancelled.¹

The Subject’s market capitalization gain, in the eleven months following the announcement, was approximately $130 billion. The data center, in the same eleven months, advanced by approximately one and a half buildings.

The Harm

The Subject’s principal contribution to the cohort balance sheet is the bezzle.

The bezzle, as Galbraith defined it, is the “inventory of undiscovered embezzlement” in the economy — the period, in any speculation, during which the speculator believes the investment is worth what was paid for it and the embezzler has not yet been required to disclose otherwise. During this period, both parties feel wealthier. The aggregate wealth of the economy appears to increase. The Subject has executed, with the announcement of Stargate and a series of related transactions, what the Center estimates to be the largest single bezzle in the history of capital markets — perhaps $400 billion in market value created by the announcement of capital expenditure that has not occurred, against demand for the resulting capacity that has not been demonstrated.

The proceeds of the bezzle, while held, accrue to the Subject and his fellow holders of Oracle equity. The losses, when the bezzle resolves, will accrue to a different population: the public pension funds whose passive index allocations were forced to buy Oracle at the elevated price; the private-credit funds whose retail investors lent against the depreciating graphics processors, on the theory that contracted revenue from OpenAI represented credit-quality cash flow; the insurance reserves of the country, held in increasingly opaque private-asset structures, whose policyholders are the working population insuring against the ordinary catastrophes of life.

The graphics processors at the heart of the operation depreciate, by the Center’s analysis, at a rate of approximately 50 percent per year, owing to the relentless cadence of Nvidia’s product roadmap (Blackwell, Rubin, Rubin Ultra, Feynman, each generation claimed to deliver multiples of efficiency at constant or declining unit cost). The accounting depreciation applied by the borrowers is on a five- to six-year straight-line schedule. The mismatch between economic and accounting depreciation is the unrecognized loss. It compounds each quarter the financing rolls forward.

The Subject is fully aware of these dynamics. He has stated, in earnings commentary, that Oracle does not bear the depreciation risk; the borrowers do. He is correct. He has stated that Oracle’s contracted revenue is “as good as Treasury notes.” He is incorrect.

Chart

Figure 3. Oracle market capitalization (left axis) versus actual data-center capacity delivered, Abilene, TX, January 2025 – April 2026 (right axis). The first line ascends. The second line is approximately flat.

Citations

• Oracle Corporation, 10-K filings, FY 2024–2025; investor day presentations, January and September 2025.
• Sightline Climate, Global Data Center Pipeline, March 2026; CIS Working Paper 26-04, Stranded Assets in the AI Build-Out.
• The Guardian, “Inside the world’s most secretive AI infrastructure project: nScale’s Luton scaffolding yard,” March 2026.
• Zitron, E. (2026). The Subprime AI Crisis. Better Offline Press.
• Galbraith, J. K. (1955). The Great Crash, 1929, Chapter VIII (“In Goldman, Sachs We Trust”), for the original definition of the bezzle.