Not sure what you mean by "wasted"? Like a regular Ponzi scheme, there are many opportunities for the people at the top to extract value out into cash, while people who "got in" on the scheme later are left holding the bag when the bubble bursts.
Yes, usually people at the top extract the cash. Like Bernie Madoff just spent the money for his enjoyment. In this case the money goes to people building the data centers, providing resources and the engineers at OpenAI who are actually working for the money.
A lot of it does - and that's great! - but a lot of it accrues to the owners of the businesses involved.
If this is a bubble and it bursts in a few years, a lot of investors in specific companies, and in the market broadly, will lose a lot of money, but Sam Altman and Jensen Huang will remain very wealthy.
I'm a capitalist and I think there are good reasons for wealth to accrue to those who take risks and drive toward technological progress. But it just also is the case that they are incentivized to hype their companies, even if it risks getting out over their skis and leads to a bubble which eventually bursts. There are just have lots of ways to extract wealth prior to a bubble bursting, so the downsides of unwarranted hype are not as acute as they might otherwise be.
