Midterm Blood Bath, $4T AI Sell Off, Data Center Freeze, What's Next for Trump

Democrats Sweep Midterms as Republicans Face Watergate-Scale Loss

Funding and deals

• OpenAI. OpenAI's IPO odds on Polymarket slipped to 71% from 95%, and the Wall Street Journal reported the valuation could land near $1tn rather than $1.5tn to $2tn.
• Anthropic. Jason Calacanis said the AI selloff puts a dark cloud over Anthropic's IPO, and Chamath Palihapitiya said model companies are not home free because they rent compute.

News

• Democrats sweep the 2026 midterms. Democrats took both chambers of Congress, at least 29 governor races, 54 to 56 Senate seats and 250 to 260 House seats, flipping Texas. David Sacks called it the biggest Republican midterm loss since Watergate.
• $4tn AI selloff is worst day in market history. Stocks fell sharply, wiping out close to $4tn in market cap across Nvidia, SpaceX, Tesla, AMD and Micron, the worst single day in stock market history by total dollars.
• Iran war drives inflation to 3.7%. Gas went from about $3 to over $4 a gallon and a rate hike took mortgages to roughly 7.5% after inflation rose from 2.4% to 3.7%, fallout David Sacks tied to the GOP defeat.
• Brent crude falls 10% on election day. David Sacks said the move showed markets pricing in a sooner end to the Iran war, which he called his top recommendation for Trump.
• Economy data stays solid into the midterms. Unemployment ticked down to 4.1% on a robust jobs report and third-quarter GDP was tracking at 3.7%, while real post-tax household income rose about 3.1% in Trump's first year.
• SpaceX pitches six-gigawatt Arizona data center. SpaceX told Cochise County the project would cut electricity costs 40%, use no water, cut property taxes 20% and generate enough revenue to pay off a county bond.
• Data center states weigh moratoriums. David Sacks said governors in the biggest data center states now favor a moratorium until conditions are met, and that gigawatt-scale projects cost around $50bn each and need certainty.
• Google takes over a Crusoe data center. The hosts cited the deal as evidence that hyperscalers including Amazon, Meta, Microsoft and SpaceX are becoming kingmakers over compute supply and pricing.
• States pass a patchwork of AI laws. David Friedberg said hundreds of state laws are passing to govern model development and deployment, and David Sacks said Democrats will certainly push federal AI legislation next Congress.
• OpenAI paper challenges exponential time hypothesis. David Friedberg said the 175-page paper shows 3-SAT problems can be solved in sub-exponential time, keeping alive the possibility that P equals NP.