Alphabet, the parent company of Google, has committed to investing up to $40 billion in Anthropic, a competitor that develops AI models like Claude. This investment is part of a larger trend in the AI industry, where companies are not only competing but also investing in one another, creating a phenomenon called 'Circular Capitalism.' In this model, funds circulate within the ecosystem, allowing companies to report growth without genuine demand. For example, Anthropic receives investments from Google and Amazon, while simultaneously purchasing cloud computing services from them. This circular flow raises questions about the actual value created and the potential for inflated valuations. Microsoft, once considered a leader in AI through its partnership with OpenAI, now faces challenges as its position weakens amidst evolving alliances. The situation echoes the late-1990s telecom bubble, where similar financing practices led to inflated revenues and eventual failures. While the demand for AI technologies remains robust, the sustainability of these financial practices is uncertain, posing potential systemic risks.