AMD & Anthropic's Partnership, Robinhood's "Platinum" Card & Vanguard's New Fund

0:28This episode is brought to you by Google Chrome. where every Friday morning we're coming at you with the biggest headlines impacting you and your money. This episode is brought to you by VCX, the public ticker for private tech. My name's Austin Hankwitz. I'm joined by my co-host, Robert Croak, and the three things sitting at the top of our rich habits radar this week include OpenAI gearing up for a eventful IPO, AMD and Anthropics' new partnership announcement, and updates on Trump's tariffs. Be sure to stick around to the end where we chat about Robinhood's new platinum card, and I'm not getting it.

1:00I don't know about you, Robert, but it is, it's interesting. We'll talk about it. Robert, let's dig into our first story. Sure, yeah. Story number one, OpenAI is gearing up for an IPO sooner than later. We've all seen it in the headlines and OpenAI added two new independent board members, David Vales, the founder and CEO of NewBank, the largest digital bank in Latin America, and Robin Vince, the CEO of Bank of New York Mellon. Vince is joining the audit committee And these are not AI people. These are Wall Street people. And they tell you exactly what this is all about. Getting the house in order for an IPO that could come as soon as later this year.

1:38So, Robert, let's put some numbers around why they need adults in the room. OpenAI just raised their projected spending on computing power to around$750 billion through 2030. That is up from$600 billion earlier this year. And remember, that$600 billion is sort of a walk back. Sam Altman originally told people the company was going to spend$1.4 trillion on compute between now and the end of the decade, which was so alarming that their CFO, Sarah, quietly went behind the backs of management to reassure investors that real numbers will not be$1.4 trillion. It'll be closer to$600 or$700 billion. But now we're seeing that creep back up.

2:18Yeah, I love your take of adults in the room because we see all the headlines about Sam. And I think it's important for everyone to understand they are putting the right team around him to make sure the guidance is correct. So here's where it gets interesting. OpenAI just committed$20 billion to a brand new data center project called Project Camellia in Effingham County, Georgia. 3.2 gigawatts of power from Georgia Power between 2028 and 2032. This is the first site where OpenAI is the leading designer and developer. At every other site, it's Oracle, AWS. They're renting that power. Now they want to own.

2:55And to build it, they've hired Brett Mayo, one of the architects of Elon Musk's Colossus supercomputer over in Memphis, Tennessee. Brent Mayo left XAI earlier this year. He reports to Uday Rudaraju, who was just promoted to chief technology officer of the computing capacity, who also worked on Colossus. So we got Brett and Uday, who both used to work for Elon to go build out their Colossus massive data center over in Memphis. But now they're being pulled over to Sam Altman's OpenAI team to build this one out, which I think is just like the most OpenAI thing ever. Steal from Elon and other people.

3:30It's interesting. Definitely. OpenAI's CFO Sarah Fryer has privately told company leaders she's worried the company can't actually pay for all of this if revenue doesn't grow fast enough. And the revenue picture is not great for sure. OpenAI has been growing more slowly than Anthropic while burning way more cash. And Sam Altman still owns zero equity in the company, which is almost unheard of for a CEO about to take a company public. So, Robert, for people listening right now that might want to be, you know, adding an open AI to their IPO watch list later this year, what does it mean for them and their money?

4:05It means this is a very important IPO setup in tech right now, and it's a mess. You've got a company projecting$750 billion in compute spending, a CFO who's worried they can't afford it, a CEO with no equity and mounting conflict of interest scrutiny, and revenue growth that's falling far behind its biggest competitor. For your portfolio, the direct beneficiaries of OpenAI's spending spree are clear. NVIDIA for the GPUs, Oracle for the cloud contracts, Amazon for the AWS deal. But the bigger questions investors need to ask is this. What happens when this company goes public and Wall Street finally gets to see a full set of financials?

4:43Because Austin, right now we're watching a company spend three quarters of a trillion dollars on a bet that AI revenue will eventually catch up to the AI infrastructure costs. And the bank analysts, the same ones who just put AI CapEx as their number one systemic risk in the B of A fund manager survey, are going to tear those numbers apart when they become public. Yeah, but I think the board additions are smart, right? Right. Velez knows consumer fintech at scale. And I think that's very much where ChatGPT is headed. Didn't ChatGPT just come out with like their ChatGPT money or something like that.

5:17Right. So like getting this product in the hands of as many people as possible. They just added a board member that's done that. Right. New Bank. Vince spent 26 years at Goldman Sachs running a 52 trillion dollar custody bank. So when you think about IPO and getting the right people in the room for a successful IPO, they're definitely trying to do that. But adding that governance doesn't fix the fundamental tension, which is Sam Altman wants to spend so much money that does not yet exist. And Sarah, their CFO, is like, maybe we should not be doing that. Right. So like it's a little, you know, kind of back and forth there between them.

5:51So something that I'll certainly be watching as the months go by. Something that I'm also watching, Robert, is Anthropic. Anthropic just made two major moves this week that tell you the company is doing everything they can to win this AI race and maybe the IPO before OpenAI. Who knows? But they're definitely trying to think outside the box, play some chess while everyone else plays checkers. So let's start talking about here this AMD and Anthropic deal. So AMD and Anthropic, they signed this deal worth tens of billions of dollars for these AI servers. Under those terms, Anthropic will purchase up to two gigawatts of AMD's latest generation chip, the MI450, starting in the first half of 2027.

6:31seven. AMD's investing$5 billion directly into Anthropic as deployment milestones begin to hit. So this is AMD's first investment into the company. Circular financing. Did someone say that? I think I heard that echo in the podcast sphere here. Yeah, but I agree with you. Anthropic's been doing it right. They're definitely playing the long game and I think they're doing a really good job. And let's look at the facts. They've been compute starved for months. Demand for cloud exploded so fast that they had to throttle back users and rate limit their own api people were seeing outages business couldn't get enough capacity so anthropic went on a shopping spree and i think they did it at the right time yeah earlier this year they signed new deals with gpu for their tpu access with amazon for the tranium chips they took over spacex's colossus one data center in memphis right that's 220 000 nvidia gpus now they've got amd so anthropic to your point Robert is building this very much diversified supply chain for their chips and their AI infrastructure.

7:35AMD CEO Lisa Su put it pretty straightforward here. She said, you can't just wake up one morning and say, I want a gigawatt of compute tomorrow. You have to plan 12, 18, 24 months in advance for this stuff. And that's exactly what this is, right? Anthropic is locking in capacity through 2027 and beyond, just like they've done again for the Googles, the Amazons, and space anywhere they can see that compute they're going to lock it down because they've got the demand for it and here's the most important part people will miss amd is also in talks to provide a financial backstop for anthropics future data center leases this is a growing pattern google already backstopped some of anthropics data center deals to help them access tpus large tech companies with investment grade credit ratings are essentially co-signing the leases of AI startups that can't raise capital at favorable terms on their own.

8:27So the chip companies are so desperate to win these AI customers that they're not just selling hardware, they're financing the entire operation. We've all heard it, circular finance, everyone's lending to each other. I think it's great for the overall growth of the sector, but time will tell. And here's where it gets even more interesting, Austin. On the same day Anthropic announced it's doubling its spending on the 2026 midterm elections to$40 million, they committed another$20 million to Public First Action, a political group pushing for government-imposed safeguards on AI models and transparency requirements for developers.

9:04Yeah, that puts Anthropic now directly at war with OpenAI's political operation. Because on one side, to your point, Robert, you've got the Anthropic-supported Public First Action, backed by Anthropic and their CEO, who personally donated a million dollars. And that, again, is for that AI regulation. But then on the other side, you have the leading the future coalition here. So Public First Action Coalition, leading the futures on the other side. That's funded by OpenAI and Andreessen Horowitz, who are pushing for industry friendly rules with fewer and fewer barriers. Right. So more AI, more stuff, more can get done.

9:39Leading the futures raised about 75 million. Public First says they've raised about 80 million. So these groups are spending millions now on advertising in dozens of primaries across the country to help persuade voters into thinking like, hey, maybe I should vote for this specific person because they believe in AI regulation. Or I should vote for this person because with more regulation, you know, China's not regulating and China's going to go win this AI race if we regulate. So let me go vote for someone that doesn't want the regulation. Right. It's just there's a lot of this kind of propaganda getting shared right now.

10:09And it just goes to show it's not organic. Right. The companies that clearly have a profit interest in one thing or another getting figured out are the ones making the donations to these different types of coalitions. If it's the leading the future from OpenAI or public first action from Anthropic and their CEO, it's like they want something to get done or they wouldn't be putting money in the pot here. Yeah, I think public first is the way to go, in my opinion, because the last thing we want to see is this being completely regulated by the government. And then all of a sudden it's a lobbying war to who wins.

10:42And, you know, you mentioned these loose fit rules. We definitely need guidance in AI and we need to understand the complexities of it as a whole. But having someone that is, you know, bipartisan, I guess you would say, that's not connected to it all or not benefiting it directly from it all, I think is better. And in a New York congressional primary, public first backed state lawmaker Alex Boras, who was co-authored the New York's AI safety bill. Leading the future spent millions to oppose him, which is interesting. And Boras finished second, but lost to another pro-regulation candidate. So the regulation side won anyway.

11:19Yeah, we'll see how that shakes out. I lean toward the government can't do anything right. And the last thing we should trust the government with is to think that they can understand and regulate a brand new technology. And I mean, you go look at what just happened a couple months ago with the White House labeling Anthropic this national security risk. They shut down two of the models over security concerns. Anthropic is, of course, suing them for that. Critics say that Anthropic wants to weaponize regulation to hurt their competitors. I think that's probably the case. Anthropic is the big fish.

11:48Anthropic is literally stealing so many ideas and applications. Think cloud design, think, you know, cloud science, like all the different types of, you know, their competitors that are running on their APIs, they're taking that proprietary data and then building their own products with it. And then they're saying, oh, no, you should go regulate the industry. So now as they regulate them as a whole, Anthropic has either so much money that they can navigate those regulations compared to the other AI startups out there or AI companies that exist that don't have that same experience and money and war chest to navigate regulation.

12:21So they get regulated out of the industry and go bankrupt, which means Anthropic now is, you know, turning into duopoly monopoly. So I actually disagree with you, Robert. I think less regulation right now. I think the, what's it called leading the future is the way that this should go. Because if you have, you know, these big fish that are really leaning toward regulation, they want regulation, they then get to say, yeah, we can help write that regulation for you you know they're the ones that are asked for the regulation of course they're going to be the ones that have this favorable terms and then once they regulate their competitors out of existence anthropics only one standing i guess next to a duopoly with open ai while all that to be said anthropics are saying no it's the safety concerns we're genuine about it we think ai safety which like don't get me wrong i have safety is like very very real and very very important but you know it's just hard to take that seriously for a company that is literally like taking and stealing proprietary information that's why alex carp went on cnbc you know going on this rampage talking about like we've had so many people that are coming to us like we're using anthropics api but we don't feel safe using it anymore because they're taking all of the information the proprietary information we're using when it comes to running our business to go create their own businesses right um so it's just it's very interesting and and i just don't know if the government is at a point now only three years into this two and a half three years into this new technology, despite, you know, the AI czar, you know, being David Sachs, who's co-founder of PayPal and being someone who very much understands, you know, artificial intelligence, like despite those types of things, like I just don't know the solution, but I don't know if that solution should be, let's just regulate, regulate, regulate, regulate, forcing AI startups and AI companies that want to be on the bleeding edge of bioscience and cancer research and, you know, all these other different things that we know AI can do to then just get regulated out of existence.

14:04Wasn't it in New York state, Robert, that didn't they come out with something that said essentially you can't ask, you know, AI for medical advice because it's not a real doctor. It's like, that's the dumbest thing I ever heard in my life. People of course should have access to medical, you know, information and the ability to do that research themselves. But like, that's the regulation that hurts people. So like, I just, I just think it's nuts. Yeah. I love that take, Austin. And I think it's really smart because I feel like there needs to be regulation, but if it's all in the government's hands, it's going to take years.

14:31It's going to slow down innovation and it's really going to hurt the U.S. as a whole. So I don't know the answer either. And you're probably right. It's better to put it in the government's hands. But maybe there's a world where separate committee can be put together to be able to handle all this and then at least present it to the government, because I automatically my brain goes to the fact that the Clarity Act still hasn't gotten approved, still isn't finished in crypto. And crypto has been around for 10, 12 years, and we're still trying to figure out how to lay the groundwork there. And we can't get both parties to agree on that either.

15:05So I don't have the answers either. I just want it to be handled correctly. So we see all of this innovation stay inside of the U.S. economy because I think everyone's crushing it right now. But we definitely have to have those guardrails of protection. So I know that was really long-winded, but I appreciate your insight there. What does this mean for you and your money? Let's break that down. Before I break that down, yes. And it's cool to see last week, the CEO of Google DeepMind came out with titled A Framework of Frontier AI and the Donning of a New Age, which is essentially them trying to build their own, you know, FINRA of sorts, right?

15:41A regulating body that all of these frontier AI labs and all these hyperscalers, it's not regulated by the government, but it's like regulated by every single person that participates in this game. It's like, let's all look each other in the eyes and say, can we all agree that this is what we're going to be doing? And this is not what we're going to be doing. And we will be doing these things. And these are the benchmarks. Here's how we're like, you know, the processes and the protocols. And we can all agree upon that without like actual legislation being passed to slow us all down. So I think that's really cool that that's taking place.

16:10And that took place, you know, July 14, I think it was last week. So regulation's cool when it's like regulation is going to help people like the FAA. right it's like of course we need can't just build airplanes and let people ride on them right we have to have some sort of regulation i right i agree but you know it's just when when one or two people or one or two of these businesses that are trillion dollar businesses right have all of the the cookies uh all the poker chips right they've got they got everything they need to like regulate their competition out of existence it's just i i just don't agree with any of that so what does this anthropic deal with amd and their midterm spending mean it means that they're simultaneously diversifying their chip supply across four different architectures that Robert was alluding to.

16:53They're getting chips from companies to finance that infrastructure, and they're spending tens of millions of dollars,$40 million to help shape the regulatory environment that their competitors operate inside on. So they're not just competing, right? They're playing chess while their competitors are playing Candyland. Now for your portfolio, here's what that means. AMD, really exciting. I am up 364 % on my AMD position, which is incredible. Hope you guys are part of the Rich Habits Network when we talked about AMD, you know, 18, 24 months ago. Lisa Su, she's been clawing for that market share from NVIDIA and AI for two years now.

17:29And landing Anthropic is, you know, a really big deal. It's a major validation for that company. But don't sleep on NVIDIA either. Robert and I talked about, you know, NVIDIA was trading like$194,$195 a share recently i was like dude i gotta go jump in on this what's going on there's the cheapest valuation in years like i just these chip companies like the market right now it seems like robert is like trying to trying to figure out like the difference between like good semiconductor companies that are durable and have like long-term profit potential and then like the semiconductor companies that whose profits are cyclical and that's what we saw with the sox right the the socks index the semiconductor index go you know it was up 112 115 in like two and a half months period of time from the depths of, I think it was March 30, all the way through the top in like mid-June.

18:13And so that was when all these investors said, hey, like, let's just go buy semiconductors. We're all so excited. It's gonna be great. But then you start to realize that semiconductor profits are very cyclical in nature and investors were treating them as permanent. And so now as the SOX comes down, I think it's down 20, 30%, individual names inside of that index, Intel, Marvell, Applied Materials, MTSI, like all these names, they're down 25, 35, 45 % from their highs. And so I think that is the market saying, okay, wait a second, there are names like ASML Holdings, like an NVIDIA, like an AMD, like a Micron, like a Taiwan Semi that are really cool and want to have them and want to own them because those are durable profits that are going to experience these tailwinds.

18:51But these other names, just because they have the word semiconductor in the title of their corporate name or they mentioned semiconductor on their earnings call, maybe those aren't the names that should be trading at these exuberantly high valuations, historically speaking, because their profits aren't as durable as we had thought. Yeah, I love that take. And I agree with you 100%. You and I deal with it every day in the Rich Habits Network where people are asking, what's the next NVIDIA trade? What's the next Palantir trade? What's the next Micron trade? Meanwhile, we're looking at NVIDIA and we're buying more of it as we're online filming going, man, this is still so cheap and we love Amazon and we still really like some of these stocks that have been around for years and years.

19:32And I think it's just people are too quick to move on from some of these companies like Nvidia that are just really in the heart of it all and really do have a long, bright future ahead of them. And the biggest takeaway for me about Anthropic itself is this is a company that went from$1 billion in annualized revenue to roughly$30 billion just in the last 15 months. And they're not waiting for the market to come to them. They're locking up chips, financing infrastructure, and spending tens of millions to write the rules of the game. And when this company eventually IPOs, and it will this year, it's going to be one of the most consequential listings in market history.

20:09The question for investors is whether all of this spending translates into durable, competitive advantage. Couldn't agree more, Robert. And I just saw online, actually, Anthropic is rumored to be doing$75 billion in annualized revenue right now, which is absolutely bonkers, if you ask me. So, Austin, let's get into story number three. The tariff truce is over. And this time, Trump has a new playbook. For the last five months, businesses in America got something rare. Quiet on the tariff front. And that's about to end. Let's back up. In February, the Supreme Court struck down most of Trump's second-term tariffs, ruling he overstepped his authority using a 70s emergency law to impose these levies.

20:51Trump immediately replaced them with a temporary 10 % tariff on nearly all U.S. imports, But that duty is legally limited to 150 days. And that clock runs out today, Friday the 24th, as we film this episode. So what happens next? U.S. Trade Representative Jameson Greer went on CNBC on Tuesday this week and said that a new tariff action is coming. So here's what we know. First, the replacement tariffs. So the administration is shifting the legal foundation from emergency powers to Section 301 of the Trade Act of 1974, which is widely seen as the more legally bulletproof way to do this. They opened a tariff investigation in 60 different economies earlier this year, and the preliminary findings proposed a 10 % tariffs on over a dozen trading partners.

21:40Canada, Mexico, EU, all that, plus a 12.5 % tariff on more than 40 nations, including China, India, Japan, and South Korea. So all that said, the tariffs would probably cover 99 % of U.S. trade, and unlike these temporary measures that were taking place beforehand, Section 301 tariffs can stay in place indefinitely. So that's what they're trying to figure out here, right? Let's go from emergency power to something that can keep tariffs implemented indefinitely here across 40 different nations covering 99 % of U.S. trade. Like, holy smokes. And before the Supreme Court ruling, the average U.S. tariff rate was about 17%.

22:16So under the temporary measures, it dropped to around 11%. And once the new Section 301 tariffs are fully in place, trade analysts expect we go right back to that 17 % tariff. Drew DeLong, a former State Department official now at Kearney, says many companies have been kind of lulled to sleep on the tariff front for the last five months. And you need to know if those companies are in your portfolio because if those tariffs start coming back up, you better be ready. But let's talk about Canada, Robert. On Monday, and here's why it's important because it comes back to tariffs. Same topic, but now Canada with tariffs.

22:50Monday, Trump announced an additional 50 % tariff on$20 billion worth of Canadian goods, wine, hockey sticks, cement, dairy, well, things like energy, potash, fish, and critical minerals are exempt from those tariffs. The stated justification is that Canada is discriminating against American products, specifically Canadian policies requiring companies to invest in auto production in Canada rather than the U.S. in bans that several Canadian provinces now have now imposed on American liquor. Who doesn't want Jack Daniels? You Canadians are missing out on Jack Daniels. Come on, baby. And$20 billion out of the$383 billion in total Canadian exports to the U.S.

23:34may sound small, but the legal mechanism Trump used is what has trade lawyers paying so much attention. He invoked Section 338 of the Tariff Act of 1930, an obscure provision that has never been used before to impose tariffs. Yeah, it gives the president power to levy duties on countries discriminating against U.S. companies, and it's a lot more flexible than Section 301 that we were just talking about. No month-long investigations required, no public comment, nothing. It's just presidential discretion. And Ryan Majuris, a former Commerce Department official, said it could attract serious legal challenges.

24:08But in the meantime, the tariffs go into effects in 30 days if nothing changes. So Jack Daniels, I mean, come on, Robert, got to get it. Can you imagine the behind the scenes meetings of Trump yelling at his legal team saying, go find me another law that we can implement to beat these guys. We got this. And they're just finding these laws from 100 years ago saying this one could work. Let's try that. I can't even imagine the research of how they're trying to beat the system that America created, you know, and it's just so crazy to think. But Canada's economy is already feeling it. Before this latest round, Canada's central bank projected growth would be 1.5 percentage points lower this year due to those tariffs, leaving projected GDP growth at just 1.1 percent.

24:53And Canadian Prime Minister Mark Carney said he and Trump would accelerate trade talks in the coming weeks ahead of the August 19th deadline when the new tariffs would kick in. And Robert, this one's pretty funny. He just threatened steeper duties on Canada over the wildfire smoke that was coming across. I know I've got a couple uncles in Wisconsin. I've got friends in New York. I mean, they were going through it. On Truth Social, he said, we're holding Canada responsible for not properly maintaining their forests. He told reporters that after speaking with Carney at Sunday's World Cup final, maybe they should pay us some damages or something.

25:26Maybe we should do some tariffs because of these wildfires. I guess, my goodness. For most Americans, the bottom line is this. Federal Reserve economists have estimated that Trump tariffs raise core goods prices by about 3.4 % through February, pushing overall core inflation up by about 80 basis points. So what does this all mean for you and your money, Robert? I would say there's three things to watch. The temporary 10 % tariff expires, and we find out exactly what replacement 301 levies look like. If the average U.S. tariff rate jumps back towards that 17%, that's a meaningful headwind for any company with a global supply chain, and it flows straight through to their consumer prices.

26:05Also, Trump is using these tariffs to force the USMCA renegotiation, and the August 19th deadline creates a window for a deal. If they reach one, the tariffs could get pulled. If they don't, you're looking at 50 % duties on a targeted list of Canadian imports on top of everything else, and we know the markets don't like uncertainty. And if Trump can successfully use that obscure 1930s trade law to impose tariffs unilaterally without investigation or comment period, that changes the calculus for every trading partner and every multinational. It means tariffs can come at any time for any stated reason within 30 days notice.