Author: Silicon Valley Alan Walker

Silicon Valley is burning 700 billion US dollars, and the bet is not on whose model is smarter - it is on whether the four narrow places on the earth can make the parts on time. Those who cannot understand this layer will spend the next three years building buildings on floating sand.

At 11:30 p.m., when I turn into the alley from University Avenue, there is a small restaurant hidden in the alley that only the elderly know about. The owner has been in the Bay Area for two decades, the menu is never on Yelp, and a 1998 Sun Microsystems employee photo hangs behind the bar. Alan Walker was leaning against the booth at the back, having his third glass of Whiskey. His words became colder and colder as he spoke, "I'll tell you something real tonight.This round of AI, everyone is looking in the wrong direction."

You think AI is a software problem, you are wrong, it is a problemA few machines

"When you watch the news, all you see is the bubble layer." Alan pushed the cup aside, "Model benchmarks, who raised another 10 billion, which startup's valuation increased eight times - these things are rewashed every six weeks and have little to do with the real fate of AI. What really determines the next decade is the hyperscaler that will be burned every year CapexHow to turn it into wafers, fiber optics, concrete, and electricity. "

"You move down this line, layer by layer, getting colder and colder - everyone is arguing around the same five companies,No one is looking at the lower layers.But the real constraints are all below. Not in the cloud, not in the model, not in the slides of Keynote. In a few buildings, in a few small towns, in the hands of thousands of engineers who you can't name. Speaking of people - AI is not a software problem at all, but a problem of a few machines that you have never heard of. If you can't understand this layer, any investment judgment is just guessing.

A machine in a small town in the Netherlands determines the ceiling of all AI

"Let me talk about a machine first and let you feel it." Alan lit a cigarette (the restaurant owner acquiesced). "There is a small town in the Netherlands called Veldhoven , and a company called ASML. A machine is sold for 400 million US dollars, as big as a bus—— It is the most complex object that has ever been built in human history and is commercially available. What does it do? In a vacuum chamber, 50,000 drops of molten tin are fired per second, and the laser strikes twice: the first shot turns the tin droplets into cakes, and the second shot vaporizes the cakes into plasma. The temperature is higher than the surface of the sun. 13.5 nm extreme ultraviolet light.

"This kind of light is absorbed by air and even glass, so there is no way to use a lens - only a mirror. Who grinds the mirror? Zeiss, Germany. How smooth is it? Magnified to the size of Germany, the highest bulgeNo more than one millimeter. The light bounces back and forth between the mirrors, and finally falls on a silicon chip moving at a speed of several meters per second, carving out a circuit that is thinner than a virus. The alignment accuracy is controlled to a few atoms by magnetic levitation. text="">Created this machine. The light source was made by a company in California - ASML could only buy it because no one could make it work stably. China spent hundreds of billions trying to get around it. This is not an industrial product, but a thin software shell built on it.

Every time you go down a level, there are half as many players

Marcus interjected: "How many narrow places are there? "Alan smiled: "It's scary. You dismantle the AI industry chain - cutting-edge large models rely on GPU; GPU relies on CoWoS packaging; CoWoS relies on one or two production lines of TSMC Nanke; HBM memory relies on one or two hybrid bonder companies in Europe; coherent optical modules above 800G rely on InP indium phosphide substrate; InP Suppliers that rely on two furnaces to turn over two weeks to produce one furnace; all this depends on transformers, gas turbines, and a power grid that has never been designed for AI. Every time you go down a level, there are half as many players. At the bottom, there are often only two or three companies left, sometimes just one. "

He took a sip of wine. "Civilization looks like a smooth surface of water from a distance, but up close it is actually supported by several load-bearing pillars. If one pillar breaks, the entire system stops. An Icelandic volcano erupted, a ship was blocked in the Suez Canal, and an export control notice was issued on Tuesday afternoon - you don't usually see these pillars,

By the time you see it, it's already too late. This game is about who can draw this column diagram earlier. Most of the financial media are obsessed with the light bulb at the top of the pillar, and they have no idea what the steel bars below look like. "

The first throatIndium phosphide,Two companies determine the speed of light in AI

"Let me tell you about the first throat - Indium phosphide, InP. "Alan's voice was lowered. "All 1.6T coherent optical modules now rely on this thing as the substrate. How many suppliers do you think there are in the world that make 4-inch and 6-inch polished InP substrates that are not in China? Two families. One is a division of Sumitomo Chemical, and the other is a small company in the United States. Most investors have not even opened its 10-K. The order backlog is at a record high, and production capacity is doubling - but the marketis still valuing it as a cyclical telecom materials stock, because it was eighteen months ago. "

Kai leaned over from the opposite side: "What about the electricity? Silicon Valley is complaining every day that data centers are short of power. "Alan smiled a little bitterly. "Lack of power is the result, and the root cause is the gas turbine. A GW-level data center park requires eight to twelve large industrial gas turbines, plus an equal number of backup units. There are three companies doing this in the world - Three companies. GE Vernova, Siemens Energy, Mitsubishi Heavy Industries. Orders have been scheduled to 2030. You pay today and it will be delivered in 2029. Standby generators, switchgear, medium voltage transformers – all in this condition, with delivery dates measured in years. "

He shook his head. "Hyperscaler's capex guidance for 2026 starts with '7' , seven hundred billion US dollars. This moneycannot be turned into electricityfaster than turbine casting and shipping. The bottleneck has never been capital - this round, capital is surplus. The bottleneck is the people who make the parts. The core blade of a gas turbine requires more than ten months of casting, heat treatment, testing, and assembly. The ceiling of AI is ultimately determined by the production capacity of several foundries. It's not something that's talked about on cable TV because it's not sexy. But physics is physics, No matter how much money you spend, you can't shorten the casting time.

The fourth throat:November 27, 2026,The biggest catalyst of the entire decade

Alan looked at his watch. "The fourth throat, the hottest - critical minerals. At the end of 2025, China suspended export controls on gallium, germanium, and antimony. Please listen clearly - it is 'suspension', not 'cancellation'. When will the suspension period end? November 27, 2026."

He spoke every word. "This day is the biggest known catalyst on the entire financial calendar from now to the end of 2030. But you turn on CNBC, turn on Bloomberg, turn on the mainstream financial media - no one takes it seriously." He sneered, "If November 27 With the Japanese restrictions restarting, global non-Chinese suppliers of gallium, germanium, and antimony will become the entire market the next day. III-V semiconductors, night vision optics, and a long list of defense components will all change overnight if they are not restarted. Continue to lie in a few small-cap stocks, and you continue to wait. But no matter what the outcome is, you have to know who is on the right side of that line. This kind of date only comes out once in decades. By the time everyone sees it, the market is already halfway through. They have been quietly building positions since the spring of last year - not because they are well-informed, but because they are reading the calendar.

Every era is defined bythe first few people who saw the physical boundaries clearly

Geopolitics and supply chains are basically the same thing, just viewed from a different table. Export controls, tariffs, sanctions, friend-shoring, reshoring - essentially the government has been slow to discover what experts had discovered years ago: a few narrow places wielding power they shouldn't have. China understood rare earths in the early 2000s and established a dominant position. The United States understands EUV and keeps China out of the frontier. Japan understood specialty chemicals decades ago and quietly collected rent. Whichever country wins narrow place will have an extraordinary say in the next economic form. "

He stood up and put on his coat. "Every major change in the past three hundred years can be told as a story of a 'neglected throat' - saltpeter and gunpowder, coal and steam, Suez and oil, silicon and memory, lithium and cobalt. Every time, a few people saw the bottleneck in advance, built an entire new order around it, and finally ate the biggest piece of cake of that era. " He put out the cigarette, "AI is the same story. There is only one question - do you want to see it now, or wait ten years to see it in the case of Harvard Business School? This time, the names of narrow places are already written there. Few people saw it, and even fewer people dared to place bets after seeing it. But it happens every time - the next era will not be defined by the people with the loudest voices, but by the first few people who clearly see the physical boundaries. "

He settled the bill and left a message: "When you figure it out, come to this restaurant to find me." I will most likely still be in this booth. "