On The Deals Shaping Our Economy
Ika here. Back in your inbox. Friday handed us a number that reorders the world: Elon Musk, trillionaire. SpaceX rang the Nasdaq bell, surged nearly a fifth, and a man who once swore his own company would fail now sits on more wealth than a third of the FTSE 100. But look past the confetti. The same machine that minted Musk's fortune is quietly rewiring financial markets - Big Tech, the cash machines that propped up your retirement account for two decades, are turning into borrowers, not buyers. While markets partied, Washington yanked Anthropic's most powerful models off the shelf overnight. And Hollywood got a new emperor in David Ellison. Three stories, one current: capital and power concentrating fast, in fewer hands, with the government's thumb pressing harder on the scale. An old era is dying.
1. 🚀 The biggest IPO ever
SpaceX soared almost 20% in the largest stock market debut in history, closing at $160.95 and valuing Musk's rocket-and-AI group above $2tn. That made him the world's first trillionaire.
By the numbers: SpaceX raised $75bn - up to $86bn if underwriters bite - and now ranks as the sixth-most-valuable public company on earth. Orders ran three times the shares on offer. Retail alone bid over $100bn.
Musk, ringing the opening bell at Starbase, marveled at the journey from a warehouse in El Segundo.
"If people had told me this was going to happen," he said, "I was like, man, you must be smoking some really good crack, because I think this company is going to fail."
His 42% stake is worth $800bn-plus. Add Tesla, and he clears $1tn.
The big picture: This isn't just one man's windfall. It signals a regime change in finance. For 20 years, Alphabet, Microsoft, Meta and Amazon printed money - over $200bn in combined free cash flow in 2024.
Now they're pouring it into AI data centres. Capital spending at the four is set to rise sixfold by 2027, to $815bn. Free cash flow is forecast to drop 70%.
Between the lines: The cash machines that bought back nearly $800bn of their own stock over a decade are going quiet.
To keep buying, they'll have to borrow. A giant buyer is leaving the market just as a flood of new shares arrives - Alphabet raising $85bn, with Meta, OpenAI and Anthropic likely next. Five firms could raise $400bn this year.
What I’m watching: History rhymes. AI-linked spending now rivals the 2007 housing boom as a share of GDP - and dwarfs the late-'90s tech bubble. BCA Research's Noah Weisberger warns that giant IPOs tend to be followed by returns "well below" average - more volatile and more likely to be negative.
2. 🛑 Washington pulls the plug
The Trump administration ordered Anthropic to cut off all foreign nationals from its frontier models Friday - and the company responded by switching everything off, everywhere, including the US.
Catch up quick: Commerce Secretary Howard Lutnick issued the directive after the government found a "jailbreak" - a way around the model's safety guardrails.
Anthropic pulled its two most powerful systems, Mythos 5 and Fable 5, from all users. A US official confirmed the order's net effect was a total shutoff.
The backstory: Federal agencies had been testing Anthropic's frontier Mythos model for weeks. Officials feared it could be used to exploit cybersecurity holes in critical infrastructure - including the global financial system.
The intrigue: This is a relationship in open warfare. Anthropic is already suing the government over the Pentagon's designation of it as a "supply-chain risk."
Trump has called the company's leaders "leftwing nut jobs." Former AI tsar David Sacks has slammed its safety stance.
What they're saying: Anthropic condemned the order as based on a "misunderstanding." The company argued government should be able to block unsafe deployments- but only through a process that is "transparent, fair, clear and grounded in technical facts." This one, it said, wasn't.
"We disagree that the finding of a narrow potential jailbreak should be cause for recalling a commercial model deployed to hundreds of millions of people."
The sharper line: Apply that bar industry-wide, Anthropic warned, and you'd freeze every new frontier release.
Why it matters: A president recently signed an order that stopped short of letting the government block a model's release, setting up a voluntary inspection framework instead. Days later, the administration found another lever — foreign-access restrictions - and pulled it hard. The message to every AI lab: Washington will reach into your product when it wants to.
Zoom out: Trump has floated the idea that AI companies should donate equity to the government. That plan hasn't moved. But pair it with Friday's shutoff, and the direction is unmistakable - the state wants a seat at the table, by persuasion or by force.
The bottom line: The most capable AI on the planet went dark for hundreds of millions of users over a single vulnerability and a fight over who controls the off switch.
3. 🎬 Hollywood gets a new emperor
Paramount's $111bn takeover of Warner Bros Discovery cleared US antitrust review, handing David Ellison the keys to one of the largest media empires ever assembled.
The deal: The Department of Justice closed an eight-month probe - 2mn-plus documents from over 80 custodians - and found no likely harm to "competition or American consumers." The merger stitches together HBO, CNN, CBS, Paramount Pictures and Warner Bros under one owner.
Zoom in: Ellison, the billionaire son of Oracle founder Larry Ellison, won the prize in February after a bruising bidding war with Netflix. His pitch: only massive scale can survive a market ruled by deep-pocketed tech and streaming giants.
The intrigue: Trump has cheered the deal, framing Ellison's control as a fix for what he calls political bias at CNN. Ellison hasn't promised editorial changes - but his hire of Bari Weiss to run CBS News reads, to critics, as a gesture to the president. The elder Ellison is a Trump supporter.
Yes, but: The fight isn't over. State attorneys-general can still challenge it. California's Rob Bonta confirmed his office is still investigating, and declined further comment.
"This is terrible news for every American who doesn't want Trump-aligned billionaires to control what they watch and how much they pay," she said, charging that the deal "has reeked of corruption and influence-peddling."
Paramount struck a different tone, thanking the DoJ for its "thorough review."
What's next: A few regulatory approvals remain before Paramount-WBD closes, expected later this year. Watch the state AGs. Watch whether CNN's newsroom feels the squeeze.
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