The $500 billion AI war ignites 🔥
Welcome to AI Collision 💥,
In today’s collision between AI and our world:
- Stargate send Arm to the stars
- Altman and Elon tee off on each other (for $500 billion)
- Duck or no duck
If that’s enough to get the billionaires fighting, read on…
AI Collision 💥
Oh boy, I mean, where do I even start with the last few days.
You thought crypto markets were wild and volatile (they are) but then AI takes centre stage again and things kick off there.
And not just in a small way either.
In a $500 billion way, with tech moguls firing off at each other online and hundreds of billions of dollars up for grabs and stocks bursting higher and… and… I think I need a sit down.
Luckily I am sat down. But let’s wind back to just a day ago when President Trump held a press conference with Larry Ellison (founder and CTO of Oracle), Masayoshi Son (Softbank) and Sam Altman (OpenAI).
The announcement was the creation of The Stargate Project a $500 billion investment and infrastructure play.
The aim is to build AI datacentres, invest in AI infrastructure and create hundreds of thousands of jobs for Americans.
Considering just a few weeks back we noted how Trump had “mugged” Masayoshi Son who was going to bring $100 billion of investment to America, then Trump got him to double it on the spot… well now he’s back with $500 million.
Side note: it’s also now being reported by Saudi Arabia’s state news agency that Crown Prince Mohammed bin Salman has spoken with Trump and promised to invest $600 billion in the US over the next four years.
This news was well received by the market with a number of AI related stocks rising in the day’s trade. But there was one standout. A company we’ve written about before, Arm Holdings (NASDAQ:ARM).
Arm is a direct beneficiary of The Stargate Project. CEO Rene Haas was on CNBC after the announcement talking about how Arm benefits.
Really it’s companies like Arm, Nvidia, Softbank that are going to see the money pumping through here. They all are related, Nvidia and Softbank owning big chunks of Arm, so it makes sense that all this had a big upside for Arm.
So much so that the stock was up 15.9% for the day!
But then OpenAI is also here in the mix too. It was Sam Altman right there next to Trump at the Presidential announcement.
And of course when you talk about OpenAI, you’re really talking about Microsoft too.
The key takeaway here, this all further confirms our view that 2025 is going to blow the results in AI stocks from 2024 clean out of the water.
That the build out of AI infrastructure will accelerate, and that even big tech companies like Arm, can rocket 15% higher in a single day, adding billions to their market cap.
It’s a beautiful time to be an investor and specially one investing in AI stocks!
AI gone wild 🤪
Keeping on with the Stargate Project, there were also some wild scenes as this announcement hit the headlines.
At it all came from the other AI tech moguls that’s also close to Trump, Elon Musk.
Right off the bat as this was all announced, Elon fired off on X.com:
Elon continued and Sam Altman fired back:
And this tit for tat has been going since, with Sam trying to charm his way through it, and Elon posting old comments from Altman that were very anti-Trump.
This is nuts.
It reeks of Elon getting a tad jealous that it was Altman up on that podium with Trump, Ellison and Masayoshi Son. After all, Elon is deploying one of the biggest AI infrastructure projects in the world with his Colossus AI datacentre and everything he’s doing with xAI.
And he also seems to very much hate OpenAI and the way he was ousted from them early on.
To soothe things a little, Satya Nadella, CEO of Microsoft then pipped in on an interview at Davos saying,
Look, all I know is: I’m good for my $80 billion. I’m going to spend $80 billion building out Azure.
Elon’s reply:
Don’t you just love it when billionaires are squabbling over who can or can’t afford hundreds of billions of dollars…
I guess we’ll see in time who can front up and who can’t. Either way the money is flowing and that’s good for AI and good for AI stocks.
Boomers & Busters 💰
AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week).
Boom 📈
- BigBear.ai (NYSE:BBAI) up 30%
- Symbotic Inc (NASDAQ:SYM) up 24%
- Arm Holdings (NASDAQ:ARM) up 22%
Bust 📉
- iRobot (NASDAQ:IRBT) down 4%
- Appen (ASX:APX) down 4%
- Tesla (NASDAQ:TSLA) down 3%
From the hive mind 🧠
- Ai in healthcare is something the Ellison spoke about at the Stargate press conference. And he’s got a point. Implement AI into the health services and you can end up with meaningful outcomes for people. Here’s proof.
- You have to balance out all sides of the debate on AI and the good, the bad and the… thirsty. This is at the least another perspective on the impact of AI.
- Off in the background of all this, Samsung had their annual “unpacked” event. And as you’d expect it was littered with AI for their products and devices. Further evidence that AI is going to be in every aspect of our lives.
Artificial Polltelligence 🗳️
Polling still broken.
But we are upgrading our account.
Until that comes through here’s another question…
Who’s right? Elon or Altman? Will Stargate come through with the full $500 billion and will it create hundreds of thousands of jobs?
Weirdest AI image of the day
A painting with a duck in an art museum. A label reads “There is no duck in this picture. – r/weirddalle
ChatGPT’s random quote of the day
The real problem is not whether machines think, but whether men do.
— B.F. Skinner
Thanks for reading, and don’t forget to leave comments and questions below,
Sam Volkering
Editor-in-Chief
AI Collision
Presumably the speed and success of A1 investment and results will depend on the speed that the basis infrastructure can be put in place. Location of power plants (Small Nuclear Reactors) and adequate cooling mediums. I suggest that the USA will make it, but the UK and EU?
No point doing all of this unless you have the power needed. The UK doesn’t produce enough energy now. We are importing 13% of electricity today. When it’s windy! If the Labour govt are as serious about this as they claim they will get RR SMR to build a fleet of reactors from today. Get on with it. Otherwise it’s all hot air.
500 billion dollars for a private project is a serious amount of money that ordinarily I would say is a combination of wishful thinking and hyperbole. However looking at how serious these companies are about shaping and controlling the future of AI I believe that this project has an excellent chance of success.
The USA is building the future by moving forward with enthusiasm and optimism. Whilst here in the UK we are reversing into the future by closing down our industry and building wind farms. No energy equals no AI.