Democrats' midterm sweep is being read as a wake-up call for Silicon Valley, with AI infrastructure and chip stocks sliding as investors price in slower data center buildouts. Texas governor-elect Gina Hinojosa made data center opposition and Elon Musk central to her campaign, and new comptroller Sarah Eckhardt will review JETI subsidy applications. Tesla and SpaceX shares fell 11% and 9% on Thursday.
Ed Zitron argues the AI buildout ends when the money runs out, citing OpenAI raising $11 billion at a $1.25 trillion valuation after tepid interest from large investors, below the $30 billion at $1.4 trillion it reportedly sought. He also reads Anthropic's amended S-1 as showing Q3 revenue near $17 billion against compute costs of $9.9 billion, roughly $895 billion to $1.07 trillion in total obligations and a possible sub-investment-grade rating. He ties this to debt markets shutting out neoclouds, Google's lower search monetization from AI overviews, and OpenAI contributing about 11% of Microsoft's latest quarterly revenue.