November 19, 2025
AI stayed dominant, but the focus shifted from model hype to cost, funding, and infrastructure. SoftBank sold its entire Nvidia stake, worth more than $5.8 billion, to raise cash for other AI investments, including OpenAI, Oracle's Stargate data centers, and onshore robot manufacturing plants. SoftBank fell more than 10% in Tokyo after the announcement, while Nvidia dropped 3.9% in the U.S.
The sale was framed as capital recycling rather than a rejection of AI. A company can still believe in the long-term theme while selling a liquid winner to fund the next leg of spending. American investors put about $104 billion into AI startups in the first half of 2025, and China is responding with state-backed chips, data centers, and subsidized computing.
Michael Burry's AI short thesis added an accounting angle. His argument is that cloud and AI companies may be understating depreciation by assuming Nvidia chips and servers last longer than they realistically will. He estimates depreciation could be understated by roughly $176 billion across the industry from 2026 through 2028, and that Oracle and Meta earnings could be overstated by more than 20% if the assumptions are wrong.
Power prices showed the infrastructure constraint. PJM Interconnection capacity prices rose from $28.92 per MW-day for 2023/2024 to $329.17 for 2026/2027, about an 11x increase. Household electricity bills have also been rising 5% to 7% year over year since the summer. Data centers can come online faster than new power supply, which makes electricity a real bottleneck.
The Fed backdrop was split. Doves pointed to weaker job growth, with payroll gains falling from 168,000 earlier in the year to about 29,000 on average over the summer. Hawks still worried about inflation above 2% and tariff pass-through. Private labor data showed employers shedding 11,250 jobs per week through October 25, and the WSJ Dollar Index slipped 0.2%.
Company activity remained active. Toyota started production at its $13.9 billion North Carolina battery plant and plans another $10 billion of U.S. investment. CPE agreed to pay $350 million for 83% of Burger King China. KKR agreed to sell Novaria to Arcline for $2.2 billion, and SBB agreed to sell a $3.4 billion elderly-care property portfolio to Public Property Invest.