Leo Sold
Plus: Ferrari Luce hits 2026 sales target in two months, Avi Schiffman launches Friend 2.0, mortgage rates jump to one-year high
Happy Thursday.
The current thing in tech and business is Situational Awareness selling all its public stocks.
Today’s Lineup
Investor & businessman Martin Shkreli at 11:15 AM
Extropic Founder & CEO Gill Verdon at 12:00 PM
Rostra Founder Lulu Meservey at 12:20 PM
Cendana Capital Founder Michael Kim at 12:50 PM
Similie Co-Founder Joon Sung Park at 1:05 PM
K2 Space Co-Founder & CEO Karan Kunjur at 1:15 PM
Robinhood Co-Founder & CEO Vlad Tenev at 1:30 PM
Run of Show
Leo Sold
Leopold Aschenbrenner’s hedge fund, Situational Awareness, has been forced to unwind its public stock portfolio after steep losses on its AI infrastructure bets, CNBC reported Thursday. Prime brokers reportedly rushed to raise cash to meet margin requirements, while Ken Griffin’s Citadel reached a deal to purchase the fund’s publicly traded assets. The fund had built concentrated positions in AI infrastructure companies including Nebius, SanDisk, Micron, and CoreWeave, while also betting against software companies such as Adobe. Those trades unraveled as AI infrastructure stocks plunged in recent weeks before rebounding sharply today.
Also relevant here — and what a bunch of people are pointing out on X — is the fact that on Tuesday it was reported that Citadel expected a surprise rate hike from the Fed meeting that took place yesterday, which did coincide with more selloff in the market. Yesterday, the Fed left the rate unchanged, and today, many of the stocks in Leopold’s portfolio are up double digits.
Aschenbrenner, a former OpenAI researcher, rose to prominence after publishing his 2024 essay series Situational Awareness, which argued that rapid AI progress would require an enormous buildout of chips, memory, power, and compute infrastructure. That thesis became the foundation of his investment strategy after launching the fund. He is also engaged to Anthropic CEO Dario Amodei’s chief of staff.
The news is coming in hot and fast on this story. Here’s a timeline of the most important headlines so far:
Bloomberg 9:25pm yesterday: Leopold Aschenbrenner’s Situational Awareness seeks to raise capital after AI rout
CNBC 6:05am: AI investor Leopold Aschenbrenner forced to unwind all public stock positions after steep losses, sources say
WSJ 8:39am: Citadel Buys Situational Awareness’s Stock Portfolio After Big Losses in AI
We’ll be discussing this on the show today.
Clip Spotlight: Bloomberg’s Joe Weisenthal on the scary double bind that compute prices 10xing puts hyperscalers in
“One of the stylized facts in recent years has been the extraordinary drop in token prices.”
“If you go back to GPT-3, token prices are down like 99.9%.”
“We think there’s some iron law that token prices will get cheaper over time.”
“But maybe not. We thought there was an iron law that memory prices would drop over time. Or that any sort of hardware would drop over time.”
“But the story of the last two years is that that law can reverse.”
“It’s not impossible to imagine that compute prices get significantly more expensive.”
“But that doesn’t mean you can stop spending on it. Because you have to worry about hardening yourself for cybersecurity.”
“There’s no, ‘This is not economical for me anymore. I want to tap out of the whole AI race.’”
“Well then, your competitor develops a stronger model. And then you’re done. You’re really done.”
“This is the scary thing. What if the situation is, you’re bleeding free cash flow, but you also don’t have the option to opt out of the game?”
Headlines
FT: Leopold Aschenbrenner’s Situational Awareness seeks to raise capital after AI rout
WSJ: Citadel Buys Situational Awareness’s Stock Portfolio After Big Losses in AI
FT: Ferrari hits 2026 sales target for polarising Luce EV within two months
Axios: World Cup organizer FIFA to seek billions in outside investment
WSJ: Mortgage Rates Jump to a One-Year High
FT: Microsoft surges 15% as results and data centre leases cheer investors
CNBC: OpenAI CFO Sarah Friar tells employees that annualized revenue in July topped all of Q2
WSJ: U.S. Economic Growth Slowed to 1.5% in Second Quarter
Avi Schiffmann’s startup Friend launches Friend 2.0
WSJ: Meta Stumbles as Tech Investors Demand Better Answers on AI Spending
OpenAI: Accelerating scientific discovery with ChatGPT for Academic Researchers
Bloomberg: Zuckerberg Finally Has a Dystopian-But-Lucrative AI Plan
Bloomberg: Kevin Warsh’s Approach to Fed Policy Is Deeply Flawed
WSJ: The Rise of Million-Dollar Companies With Just One Employee
The New Consumer: The 25 brands consumers most identify with — and the 25 they aspire to
Michael Bloomberg: We Can’t Fix America’s Schools Without Data
WSJ: Elite Brands Are on a Quest for Microplastic-Free Water
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