OpenAI's $100B Deal w/ AMD, 2026 Tax Brackets, & Rising Foreclosures

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0:44Public.com presents this episode of the Rich Habits Radar, a new Friday episode of the Rich Habits podcast, where every Friday morning we're coming at you with the biggest headlines impacting you and your money. My name is 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's new major multi-year deal with AMD, foreclosures spiking by 17 % in the third quarter of 2025, and the IRS's newly released tax brackets for 2026. Spoiler, you're likely going to save a few hundred dollars on taxes next year, but we'll get more into that later.

1:26And be sure to stick around to hear more about the results of Piper Sandler's annual teen survey. Some of those answers are going to shock you. So, Robert, let's dig into our first story. That's right. OpenAI and AMD signed a multi-year deal worth tens of billions of dollars. Announced Monday morning, OpenAI and AMD have officially signed a multi-year deal that will generate tens of billions of dollars in annual revenue for AMD and give OpenAI the option to buy up to 10 % of AMD. And the stock is already up 51 % on the news so far, but we're up over 150 % because we've all been buying sub$100 per share earlier this year.

2:10Wall Street is saying it's a major vote of confidence in AMD's AI chips and software, but is unlikely to make a dent in NVIDIA's dominance as the market leader. The deal covers the development of hundreds of thousands of AMD AI chips, equivalent to six gigawatts over several years, beginning in the second half of 2026. So get this, that's enough energy to power five million U.S. households, which is just crazy to me. AMD said OpenAI would build a one gigawatt factory based on its new MI450 series of chips beginning next year. And AMD executives confirmed that the company is expecting more than$100 billion of new revenue over four years from OpenAI and their AI customers.

2:59Let's talk about this deal and how it's structured, Robert. So the deal is structured like this. AMD has issued options, or warrants is another word for that, that give OpenAI the ability to buy up to 160 million shares of AMD stock for a penny each over the course of this deal. Now, the options vest in tranches, which essentially mean that over time, specific milestones have to be hit. And once those milestones are hit, the options can get exercised. So the first milestone that has to be hit before the first tranche of options can be exercised is the initial shipment of those MI450 chips over to OpenAI.

3:43The second milestone that needs to be hit for the second tranche here to allow OpenAI to purchase the stock of AMD is that AMD's stock price has to hit up to$600 a share, which is like two and a half to three times higher than where it's trading at today. So that's just really interesting to me, Robert, that they baked in stock price going up to 600 as part of this deal. I think that's super bullish, but walk us through what it means for our listeners and their money. Yeah, NVIDIA has dominated the AI GPU space, and this agreement gives AMD a major validation and foot in the door to large-scale AI workloads.

4:24So OpenAI no longer needs to lean exclusively on NVIDIA, and that gives it negotiating leverage, supply redundancy, and resilience to the company overall. Yeah, so as you think about like the demand from AI companies and how that's going to intensify, pressure will begin to mount on these GPU supply chains, right? So AMD is all about the GPUs, which is different than NVIDIA. So as the pressure mounts, more demand for open AI, the GPU supply chains are going to get constrained, maybe manufacturing capacity hits the top of its spectrum, like a lot of things could go wrong that could derail this and could backfire.

5:02But I don't think that's going to happen, Robert. Lisa Su has been the president and CEO of AMD for over 10 years at this point. She's an absolute machine. You've seen what the stock price has done under her leadership. I don't think AMD is going to suffer at all from this partnership. I think the opposite is going to happen. I think AMD stock is going to inch closer to that$600 per share, which I think is good news for all of us because we own a bunch of AMD stock. And I will continue to buy AMD stock into the future. Yeah, and the real interesting part is that the AI infrastructure play now is even more attractive.

5:34More centers equals more money generated for these infrastructure names like Broadcom, Marvell Technology, Ariston Networks, and even one of our big call-outs, Constellation Energy Group. Let's now jump to our next point, which are the fact that foreclosures are spiking by 17 % in Q3 of this year. There's been a spike in that activity for the foreclosures in the United States, recording 101 ,513 foreclosure filings for properties during the third quarter, reflecting actually a slight increase on top of the second quarter. Now get this, Robert. Bank repossessions have skyrocketed by 33%. Unreal.

6:16So not only are foreclosures up, but those bank repos. You walk me through this. You're the real estate guy. Yeah, this is a big, big sign of opportunity to come in the housing market. I remember the last time we were in this boat in 2010 and 11, and there were so many foreclosed homes, tax lien homes, all of these different properties that were 60, 70 percent off because people were in over their heads. And according to housing experts right now, the persistence of this trend could be an early indicator of emerging borrowing strain in some parts of the country. Mortgage rates and prices have simultaneously increased since the post-pandemic lows, with a 30-year fixed mortgage rate sitting at around 6.5 % and the median home price, believably, at around$431 ,000.

7:07So according to the poll by APNORC, 75 % of adults said they were experiencing stress from the cost of housing. So here's what that means for your money. Although rates remain elevated, I still believe this is a buyer's market. And in the long term, the numbers will work in your favor by being a buyer of real estate now rather than waiting for rates to come down dramatically because that could be two, three, four years away. So then you're going to find yourself in these price wars and that's even more difficult. So make sure you understand all the numbers, your buy box, and where things are in real estate right now, because it is a very tough decision to rent or to buy.

7:49Yeah, it's our belief, right, Robert, that mortgage rates, right, because they're tied to the 10-year yield, likely aren't going to come down below 5 % for the next two, three, maybe four years. So keep that in mind, right? When you're considering if it's a good time to buy or not, we continue to hold the belief that you should buy real estate at some point in your life. But right now, it's interesting to observe and reflect upon the fact that renting is indeed cheaper than buying, especially when you take into account that 5, 10, 15, 20 % down opportunity cost of that down payment, what it could have been in the markets, right?

8:27The markets are up for the third year in a row now, double digits. I mean, it's insane. On the flip side, we're seeing year-over-year increases of real estate. I think it's 2.1 % is the average in the country. So it's having all that money tied up in a down payment for it only to go up on average 2 % versus the markets now 20%, 20%. This year is 15%, 16%, 17%. It's like you really got to weigh out those options. Yeah, it is a difficult situation because on one hand, I think everyone should own real estate and should be buyers of real estate. But you said it perfectly, and that is it's cheaper to rent.

9:03So if you're in a situation right now where you're crushing it, you're making a lot of money in the markets, and you want diversification real estate, go for it. There's a lot of good programs out there, and it is a buyer's market. But if you're squeaking by, living a little bit beyond your means or whatever, renting is definitely the way to go right now. So let's get into our last point today, and that is the updated 2026 tax brackets. Tax brackets are getting their annual inflation adjustment with the biggest adjustment for those in the lowest tax bracket, helping them save more money, so let's dig in.

9:37This year's overall adjustment of 2.7 % comes in just under the current inflation rate of 2.8%. However, hourly earnings, according to the Labor Department, are up 3.7 % this year, which means in theory you should have more money staying in your pockets. It will now take more income to reach each higher tax bracket after a 4 % inflation adjustment for the two lowest tax brackets and a 2.3 % increase for the highest tax bracket. So let's break down some numbers here, Robert. a married couple filing jointly could have$100 ,800 in taxable income for the year, household income of$100 ,800, nearly$4 ,000 more than last year, and still stay in the 12 % tax bracket.

10:25I think that's pretty cool. The standard deduction rises to$16 ,100 for individuals, an increase of$350 year over year, and$32 ,200 for married couples who file jointly, $700 year over year. So you just take the 350, multiply it by two there. Now capital gains rates also adjust for inflation, which I think is interesting because that means that married couples who file jointly with incomes up to$98 ,900 or less will pay 0 % in taxes on their capital gains. I think that's really cool. And for those of you who are uber wealthy, the new federal estate tax exclusion has been raised from$13.99 million up to$15 million even this year, meaning that$15 million of tax-free money can be passed down to your heirs after your death.

11:18So Robert, what does this mean for you and your money? I think the obvious part of life is that we have to pay taxes. The phrase is nothing in life is guaranteed besides death in taxes, right? So to me though, it seems like we're getting a little bit of a step in the right direction. And hopefully our listeners here are going to have a little bit more money this time next year in their pockets. Yeah. The biggest takeaway for me and everyone listening is to not forget that 0 % capital gains. Literally, if you and your spouse are living off a portfolio income and you realize capital gains are$98 ,900, you literally owe 0 % in capital gains taxes for the year.

11:56So knowing the tax code can really help you save thousands per year. And that is why we're always trying to keep you guys updated on what works and how to keep more money in your pocket. All right, Robert, let's now jump into our rapid fire section. This is the part of the show where Robert and myself, we bring three headlines that we think are super interesting to us. And we kind of just give you the cliff notes. So headlines I'm talking about are going to be the Piper Sandler's annual teen survey results, video games now on Netflix for TVs, and Calci and what they're predicting as to how long the government shutdown is going to last.

12:32So let's start with the teen survey results. Every year, an investment bank called Piper Sandler hosts a teen survey in efforts to understand how more than 100 ,000 United States teenagers are spending their money and how that could correlate to the economy. So here are some interesting results. Chick-fil-A is the number one preferred chain restaurant, while McDonald's and Chipotle rank numbers two and three. TikTok ranked as the number one app for 46 % of teens, with Instagram and Snapchat at 31 % and 14 % respectively. Netflix remains the number one choice for entertainment, with YouTube close behind.

13:10I would have thought that teens would watch more YouTube than Netflix, but who knows? Nike continues to dominate as the top clothing brand for teenagers. Hollister is ranked number two and Brandy Melville at number three. That brand has been all over the place here in Nashville. Brandy Melville. Cool to see they're doing some stuff there. On Running overtook Hoka for the first time over the last six years, which is interesting. And Amazon remains the number one hub for shopping. And finally, to no one's surprise, their favorite influencer is and remains to be Mr. Beast. All right, Now let's talk video games on Netflix for television.

13:47So video games, as we guys might know, has been on Netflix for four years now, but only on the mobile devices. So in your Netflix app, on your iPhone or your iPad, that's where you play the video games. But now you can play video games on your television as part of your Netflix subscription. Netflix has identified four focus areas for their gaming push, games for kids, party games, mainstream hits like Grand Theft Auto, and titles based on Netflix franchises like Stranger Things. The company has also been investing in cloud server capacity to ensure smooth gameplay as traffic is supposed to increase.

14:19We'll see if that impacts the stock price at all. And now rounding it off, Kalshi is pricing in a government shutdown to last 26 days. So Kalshi now pricing in a 26-day government shutdown is up three days. It was 23 days earlier this week. Now it's up to 26 days is the assumption. as President Trump said he's not willing to entertain talking about extending Affordable Care Act subsidies until the federal government reopens. A key reason for the shutdown is that Democrats are opposed to the Republicans' plan not to extend Affordable Care Act tax credits for 2026. If that were to happen, many individuals who obtain their health coverage through state insurance exchanges are likely to face drastically higher premiums without those subsidies.

15:02Now, according to Kalshi, the chances of the shutdown lasting more than 20 days rose to 59%, while the odds of it stretching past 30 days now stands at 40%. And, for example, Robert, you know, with the headlines and things that get you all emotional, I saw on Instagram that, you know, I'm a Tennessee football fan. And this weekend in Neyland Stadium in Knoxville, we're playing the Arkansas Razorbacks in football. But there's not going to be a flyover with the airplanes. Everyone's like, oh my gosh, what's going on? They blamed it on the government shutdown. So in the moment, right, there's a lot of like headlines and emotion that comes with government shutdowns that impact us in ways we might not know.

15:40But what's important to remember here is that over the long term, government shutdowns are nothing burgers for the stock market. You want to be a net buyer of assets. And it's just so important to stay focused on having a plan and sticking to it. I love these rapid fire sections because when you think of the Piper Sandler's teen results, their survey results, it really gives you an eye into America of where people are spending their money, especially teens. And that's a big driver of the economic conditions. And we talk about this all the time. We actually talked about it on the Rich Habits Network last night about the book from Peter Lynch, where he talks about buying what you know.

16:15And if you're not sure what to invest in, go to the mall. And these results really are important for people when you're kind of sifting through the breadcrumbs trying to figure out where to invest. Because if you think about it, and let's say you were considering investing in Sweet Greens or some other fast casual chain, but you see right there in plain fact, Chick-fil-A number one, McDonald's number two, Chipotle. It really shows you it's hard to beat the incumbents. Same thing with On Running. They're catching up to Nike, but Nike is still the leader and they overtook Hoka. So I love these rapid fires as a way to really reinforce what we talk about every single week on how people can find what they should invest in besides just looking at a stock chart.

17:02So let's get into my three rapid fires. Number one for me is crypto ETFs are doubling heading into 2026. With a mix of regulatory green lights, supportive monetary policy, and huge institutional demand, it's all good news on the ETF adoption front. And this will certainly bolster valuations and pricing, with many experts stating that they assume we will see a$200 ,000 to$250 ,000 Bitcoin sooner than later. So my next rapid fire is gold hits all-time highs, passing$4 ,000 an ounce for the first time in history. And this signifies a great positive for gold holders like myself in Austin, but it also highlights some perceived cracks in the market due to heightened inflation and economic uncertainty.

17:52This is why we always preach diversity. I like to always have 3 % to 5 % of my portfolio in precious metals like gold, silver, and copper. and right now is no different. We wanna see that diversity. And my last one, speaking of diversity, is US Rare Earth and other critical mining stocks are surging like crazy on further US government intervention. And I think this is great news. And right now on the back of this deal with the Lithium Americas Corp and MP Materials deal with the US government in the recent couple weeks, stocks like Trilogy Metal, US Rare Earth, and energy fuels are all surging on this news.

18:34We've all watched the U.S. government taking these stakes and giving loans to all of these companies that they believe can push the narrative forward for us to become a powerhouse. Because remember, we need a lot more power and infrastructure to be able to facilitate all the growth in manufacturing for all of these gigafactories and all of these huge data centers. So I expect to see further growth in this and all portions of the energy sector moving forward. And since the news, just for one example, Lithium America's Corp, LAC is the ticker, is up 180 % already and others are following suit. Let's just define a couple of things here, right?

19:16So one, no one could have known ahead of time that LAC stock was going to be, you know, going up 180 % or 200%, whatever it is, right? It's like Trump announced the investment and of course the stock goes up. Like, don't feel bad. Oh, what's the next stock? Like, who knows it? What is it? Like, nobody knows. And if someone's telling you they know, they're lying to you. I will say that what's interesting to this point, this last point here, Robert, is that on Monday, Trump said our grid is old and tired, right? Like he said that, which to me thinks like, okay, maybe that his next, you know, government, private public investment thing could be into some electricity companies or something that's going to help our power grid.

19:55So it's just I'm not telling you that Trump's telling you what to buy. Right. But I remember back in April or whatever it was, he said, buy stocks and they're up like crazy since then. And, you know, it's just it's just so interesting to have a president like this that's so outspoken when it comes to money in the markets, to be quite honest. Yeah, I love it. And I honestly do think if you follow the tea leaves of what Trump is putting on X and what the headlines are, there's a tremendous amount of money to be had. As long as you're ahead of the news cycle, like Austin said, you don't have to know ahead of time because we don't know ahead of time.

20:29But if you're following it closely and you beat the masses, there is a tremendous amount of opportunity happening right before our eyes. All right, Robert, let's now jump to the Q &A section of this episode. As you all know, the Friday episodes, we answer questions from entrepreneurs, from side hustlers, anybody out there that's trying to earn more money and they have questions about their small business, their side hustle, anything going on, we got your back. Let's answer some questions. So our first question is coming from Daryl B. He emailed us this question at richhabitspodcast at gmail.com.

21:02You can do the same or you can DM us on Instagram at richhabitspodcast. Daryl says, hi, gentlemen. This is more of a question for Austin. You started your career with a nine to five job. Then at some point in your 20s, you switched to being an entrepreneur. I know this is different for everyone, but how much income from your business did you actually have before you felt comfortable quitting your day job? That's the dream, right? We have enough money from our business that we can go all in on it and blow it up. So congrats, guys. You guys both nailed it. Best regards, Daryl. Good question, Daryl.

21:33So at the time, I was making$65 ,000 or$70 ,000 a year at Amedesis, which was the company that I was doing finance for out of college, corporate finance. Really enjoyed it, by the way. Highly recommend. And I started, I'll never forget, I remember when I first started making like an extra$100 a month or$200 or$400 with my business. And I turned to$800 and then$1 ,200. Then I had this clear line of sight to$10 ,000 a month that I'd start making from this business that I was building alongside Christian. And to answer your question plainly, how much did I have? How much was I making before I quit my job?

22:09A couple of big decisions were going through my head. This is the framework I used. The first thing was like, okay, if I didn't have any money at all coming in from this business, how long would I survive on no money? Knowing I had a mortgage payment, knowing that I had utilities. I had like things that people pay for when they're living their lives. And to me, as long as I had six months or so of like a little bit of a cushion where like if everything falls apart, Trump bans TikTok overnight, something weird happens during, you know, this 2020 era of content online. When I was building my brand and my business, you know, I would have a little bit of leeway and I could always go back to my job and say, hey, can I do this again or go to a competitor or whatever?

22:48It's like working in healthcare finance is like definitely a thing. So for me, it was about, again, three to six months. And then I also thought too, like how little amount of money could I live off of knowing that if things did go bad and I really had to dial it down, what was that number? So I understood like truly what had to happen for me to like hit some of these benchmarks. But to answer your question, I quit my job March of 2021. I started doing this stuff March of 2020. My business was averaging between 25 and 30 ,000 a month in top line revenue on about 80 to 90 % profit margins. So I guess you could say I was making around like six or seven times my monthly income from my salary.

23:29But the thing is like, okay, cool. I'm making more money, but what's the after tax, right? Cause I know when I'm getting paid after taxes every single two weeks from my employer, I know what goes to my 401k. I know what goes to my HSA. Like I know, but what's the actual like after tax numbers and how do they shake out over when it comes to having a business. So definitely had to figure out, cool, this is revenue, this is profit. What's the after tax number now? I'm not going to have a 401k anymore. Like I got to start doing that. So how's that going to impact things? So there's a lot of like questions you need to ask yourself and have answers to before you make the leap.

24:01I always encourage people to be making at least two times more with their business, with their side hustle, whatever it is before you want to make that leap, because I promise you, it looks like two times more on the surface, but it's probably going to only shake out to be like close, if not like 25 % more than what you would have done over here. Plus all the risk that comes with being an entrepreneur. So Robert, what's your take? Yeah, I think your breakdown is really good. I tried to do what you just did, but it didn't work out for me. I was also doing finance for a series of car dealerships, a family of car dealerships.

24:33And I went to them and I said, hey, I'm starting this new business. I'm taking over my family's restaurant and bar. I'm going to renovate it. I'm going to reopen it after my grandmother's passing. And I would like to do both for a while till I get on my feet. And I was a really good salesperson. So the owner was like, absolutely go for it. We realigned and shortened my hours up so that way I could do both. And I literally worked two full-time jobs, even more than that for quite some time. But unfortunately we had a new general manager. He did not want to play nice with me having special hours in treatment.

25:07So he and I got in an argument. I had to quit abruptly. And then I had to go backwards for a little while and live off of that six months of emergency fund to be able to get the restaurant and bar finished and opened. And it was the best thing I ever did. But I definitely had a bump in the road for a few months where I had to live off of the money that I'd put away and invested and saved. And that was at 23 years old. Best move I ever did. I've never punched a clock or worked for anyone again. So I love your situation here. And that's my take on what I would do. Yeah. To the point of felt like working two full-time jobs, like that's exactly what it was for me from March of 2020 to March of 2021, that year that I essentially did work two full-time jobs, right?

25:51Christian and I were just starting to build our business. We would work our jobs from, you know, 7.30, 8.30 in the morning till about 6.30, 7.30 at night. And then we would have some dinner, then jump on the computer and on a Zoom call or whatever and build our business from, you know, nine o 'clock at night to sometimes two in the morning. And we do that every day. And then weekends, every weekend. It was like that all the time, right? It's like all my friends were, you know, this was a peak, you know, 2020 summer. So everyone's trying, you know, you can have takeout, what is it? Alcohol and Nashville, you know, all the fun stuff.