OPENAI’S $100 BILLION QUESTION

OPENAI’S $100 BILLION QUESTION

Good morning,

The numbers are getting silly. OpenAI is reportedly in talks to raise a staggering $100 billion. If that checks out, it would value the company at nearly $830 billion. It is a clear signal that the AI arms race is moving from "expensive" to "sovereign wealth" territory.

Meanwhile, the dealmakers are officially back. Global M&A volumes are flirting with record highs, and Wells Fargo just posted its best investment banking year ever. Even Blackstone is doubling down, insisting that the massive boom in data centers is nowhere near a bubble.

Getting started.

The Pulse

As of 12/18/2025 market close.

Markets

  • U.S. stocks rallied yesterday. Traders seem optimistic about the latest inflation data and central bank moves.
    • The S&P 500 snapped its four-day losing streak.
  • Japanese 10-year yields hit 2% for the first time since 2006 after the BOJ raised rates.
  • Gold and silver are hovering near record highs.
  • Currency volatility is vanishing. One-month volatility in G10 currencies slid to 5.8%, the lowest since 2022.
    • Pound volatility is at its lowest since 2014.
    • Euro volatility dropped to its lowest levels since July 2024.

Earnings

  • Accenture beat Q1 estimates thanks to strong demand for AI-driven IT services (RT)
  • FedEx issued a beat-and-raise for Q2. They cited strong B2B demand and tailwinds from AI data center growth (CNBC)
  • Nike beat on revenue but missed on earnings. Tariffs and a slow turnaround pushed margins down by 3% (RT)
  • This week's lineup:
    • Today: Carnival
  • See the full calendar here.

Prediction Markets

  • The market is finally sobering up on rate cuts. Unless, of course, you think the Fed is about to cave to political pressure (Polymarket)

Headline Hunt

  • Top Fed candidates disagree on everything except rate cuts (RT)
  • The ECB held rates steady at 2% (CNBC)
  • The BoE cut rates to 3.75% in a divided vote (CNBC)
  • China launched a $110B free-trade experiment on Hainan island (RT)
  • Global M&A volumes nearly broke records, with more expected in 2026 (RT)
  • Nasdaq sees an even bigger year ahead for billion-dollar IPOs (RT)
  • U.S. CLO sales hit a fresh record this year (BBG)
  • Wells Fargo investment banking had its best year ever (WSJ)
  • JPMorgan reclaimed the top spot on the U.S. high-grade bond league table (BBG)
  • Blackstone's CEO says the data center business is not a bubble (BBG)
  • Tesla's "Musk premium" is in focus ahead of the SpaceX IPO (BBG)
  • Goldman Sachs and JPMorgan see the record India IPO boom extending to 2026 (BBG)
  • The Fed terminated demands for Citigroup to improve risk controls (RT)
  • Prudential Financial put key units under the CEO in a leadership overhaul (RT)
  • Catastrophe bonds linked to wildfires are losing their "untouchable" status (BBG)
  • Meta is developing a new image/video AI model code-named "Mango" (WSJ)
  • The U.S. DOE tapped Big Tech for a "Genesis Mission" AI push (RT)

The Deal Room

M&A / Investments

  • Warner Bros. Discovery shareholder Harris Associates is encouraging Paramount Skydance to increase its $108B hostile bid for WBD.
  • Trump Media agreed to merge with nuclear fusion developer TAE Technologies, backed by Google, in a $6B all-stock deal.
  • Howard Hughes, backed by Pershing Square, will acquire specialty insurer Vantage for $2.1B. Pershing Square is investing $1B to back the deal.
  • BNP Paribas is in exclusive talks to buy Mercedes-Benz's car-leasing unit Athlon for $1.2B.
  • Italian fintech Nexi rejected a $1.15B binding offer from TPG for its digital banking unit.
  • Francisco Partners is considering a $1B sale of DNA testing service MyHeritage.
  • Standard General is in talks to acquire all or part of Warner Bros. Discovery's cable networks, including CNN.
  • ByteDance agreed to form a joint venture for TikTok US. A consortium including Oracle, Silver Lake, and MGX will take a 50% stake.

Venture Flow

  • OpenAI is in talks to (raise) $100B at an $830B valuation.
  • Advanced Machine Intelligence, founded by Meta's ex-AI chief, is in talks to raise $585M at a $3.5B valuation.
  • Lovable, a vibe-coding startup, raised a $330M Series B at a $6.6B valuation led by CapitalG and Menlo Ventures.
  • Exein, a cybersecurity startup, raised a $217M round led by Blue Cloud Ventures.
  • Edison Scientific raised a $70M seed round led by Triatomic Capital and Spark Capital.
  • Endra raised a $20M seed round led by Notion Capital.
  • Thread, an AI service desk startup, raised an $18M growth round led by Susquehanna Growth Equity.
  • Enlightra raised a $15M round from Y Combinator and others.

IPO / Direct Listings / Issuances / Block Trades

  • Activist Elliott is wooing investors to push Toyota to improve its $30B take-private bid for Toyota Industries, after taking a $1.7B stake.
  • Elliott has also built a $1B stake in lululemon.
  • Elliott is preparing to IPO Barnes & Noble and Waterstones next year.

The Debt Desk

  • The EU will lend $105B to Ukraine, borrowed against the shared budget after plans to use frozen Russian assets failed.
  • ADNOC secured $11B in funding for its gas production project.
  • Flash Compute is seeking to sell $1.3B of junk bonds to fund a data center.
  • HDFC Bank raised $1B in overseas loans from Asian lenders.
  • Blackstone completed a $595M CMBS deal backed by UK warehouses.
  • Bank of Baroda raised $500M in overseas loans.

Bankruptcy Watch

  • The administrator of Terraform Labs sued Jump Trading for $4B for allegedly profiting from the firm's collapse.
  • Brazilian banks agreed to $3.6B in combined losses related to loans for Odebrecht.
  • Tricolor's $1B fraud was reportedly caught due to an Excel mistake found in a recorded phone call.

Fresh Capital

  • Germany launched Deutschlandfonds to attract $150B in private investments for infrastructure and defense.
  • Accel is seeking to raise $4B for its fifth growth equity fund.
  • S3 Ventures raised $250M for its eighth fund.
  • Standard Investment raised $175M for its fifth flagship fund.
  • Whitehaven will return LP money and convert to a family office.

Crypto Corner

  • The U.S. crypto industry is cheering its 2025 wins, but the party may fizzle out next year.
  • North Korea stole $2B in crypto this year.
  • Coinbase is pushing into stocks and prediction markets as the retail battle heats up.

Today’s Meme Pick

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