The Brief by Introduction.com - Fintech Friday: The Utility Bill

Hey guys, happy Friday. Hope you're well.

Every so often an industry gets so big that Washington can't let it fail. Power companies got there first. The big banks got there in 2008. This week it started to look like AI is next.

Anthropic signed a seven-year deal like a power company would, the Fed started blaming AI for inflation, and Palantir's Alex Karp said the labs will end up asking the government to take them over. Today we follow the bill. Grab a coffee, let's get into it.

Utilities get built with borrowed money, and borrowing just got more expensive. The 10-year Treasury hit 5.2% this week on good news, not bad.

Business activity ran at its fastest pace in five years, and the bond market read that as more inflation. Mortgages crossed 7% again, and the odds of another Fed hike in October are about 70%.

🇺🇸 At home

🌍 Abroad

Here's who is lending the money. The biggest checks this week were loans, not deals. Paramount started raising $49 billion of debt to pay for Warner Bros., and SoftBank asked bond buyers for $11 billion to fund its OpenAI stake and got more than $20 billion in orders. Even at 5%, lenders are lining up to fund the build. That's what happens when investors think something is too important to fail.

🇺🇸 Domestic

🌍 International

Every utility runs on power, and power is the bill that keeps going up.

Oil did two different things this week.

Brent, the global price, ended near $105, while WTI, the US price, slipped to about $93.

That $12 gap says the problem is ships and sea lanes, not American wells.

Americans still pay for it at the pump, where diesel hit another record at $6.50.

The AI build needs more electricity every month, and it's buying it in the most expensive energy market in years.

🌐 Prices

AI is starting to look less like an app and more like the power company. Or the big banks.

On Wednesday Anthropic signed an $11.6 billion, seven-year deal to rent computing power from Akamai, with the right to buy about 5% of the company. That is how power plants get built, not how software gets bought. Two days earlier the Fed said AI spending is helping push prices up.

Palantir's Alex Karp says the labs will end up asking Washington to "nationalize us, please," and he thinks that's backwards. We saw this with the banks in 2008. A government backstop means the labs can't fail. It also means they don't get to run like startups anymore.

Once something gets big enough, Washington shows up. This week it was Kalshi's turn.

On Tuesday the CFTC warned that bets on what one person will say are easy to rig. Trump's teleprompter operator made $107,539 betting on speeches he saw early.

Bitcoin hit its highest price since January on Monday, then cooled as the odds of another Fed hike climbed.

🪙 Majors

Bitcoin just hit its highest price since January, and the big predictions are back with it. Hedge fund manager Mark Yusko says it's headed to $250,000, about three times where it trades today.

Then Thursday showed how fast the mood can flip. When the odds of another Fed hike jumped, bitcoin slid back to $84,000.

The move: watch the swings. When prices bounce around this much, every dip is a chance to buy in cheaper.

On Wednesday Meta showed off new AI glasses and a keychain called Muse Charm that does one thing: talk to Meta's AI.

Up to now, AI lived in an app you had to open. Meta is moving it into things you wear and carry, so it's there the second you ask. That changes who owns the relationship with your family. Google owned search because it owned the box you typed into. The next box is a voice in your ear, and Meta wants to be that voice.

We always figured Apple would get here first. It has the design, the stores and the trust. Facebook beat it there. Now its AI sits on your glasses, hangs off your kid's backpack, and knows who your friends are.

This is Alexandr Wang's baby. Meta paid $14.3 billion for 49% of Scale AI last year, largely to bring Wang, now 29, in as chief AI officer. His lab built Muse, and at Connect he said the goal is "personal superintelligence" for everyone. If Muse becomes the voice your family talks to all day, $14.3 billion starts to look cheap.

Enterprise: Apple, Meta and Alibaba all pushed hardware this week that lets companies own their AI instead of renting it.

Research: IonQ showed an ordinary chip can fix quantum errors in real time, and the next day Nvidia picked its machine for its Boston quantum lab.

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