Platformonomics TGIF is a weekly roll-up of links, comments on those links, and perhaps a little too much tugging on my favorite threads.
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The first hyperCAPEX companies report next week and I assume everyone is as giddy as I am for full 2025 CAPEX numbers.
News
Automating the Federal Reserve: January 2026
The Federal Reserve Open Market Committee meets next week. Lets see what our AI agent would do:
Based on the Taylor-Rule framework and the information available today, I am maintaining the federal funds target range at 3.50% to 3.75%. Recent inflation readings appear to be moving closer to—but are not yet durably at—our 2% objective, while labor-market indicators remain tight but show early signs of cooling; estimates of the neutral real rate and the output gap span meaningful ranges, and several key data series are either lagged or noisy. Input from the Board of Governors reflects broad agreement that policy is currently restrictive and appropriately positioned, with some dissent emphasizing upside risks to inflation persistence and others highlighting growing downside risks to employment. Given these uncertainties, and in keeping with our commitment to policy smoothing, the Committee judges that holding rates steady best balances the risks at this meeting. We will adjust policy as needed based on incoming data, with future moves contingent on clear evidence that inflation is sustainably converging to 2% and that labor-market conditions are evolving consistent with maximum sustainable employment; absent unanchored inflation expectations or financial stability risks, any adjustments will proceed gradually.
That decision took seconds. So much simpler than a two-day human meeting, never mind all the subsequent blathering about the human aspects of the decision.
Allocating Oracle’s Capital
Capital allocation at the database vampire is not easy these days. So many demands, so little capital, at what once was a capital-light software business:
- Oracle started the AI era with $70+ billion in debt for Cerner and other acquisitions
- They have a few hundred billion in Remaining Capital Obligation if they want to realize their proclaimed AI ambitions
- They’re buying a piece of Tik Tok to maintain their ability to provide state-of-the-art GPUs to China’s largest AI company in Indonesia (at least they’re buying in at an artificially low valuation by letting the Chinese retain algorithmic control)
- The Ellison family relies on the dividend and particularly needs to fund scion Bronny’s Hollywood ambitions
We’re monitoring closely for any signs of the budgeting exercise in the image above.
Previous:
They Don’t Have the Money: Who Could Possibly Have Guessed?, Oracle Disappoints: Q2 FY26, Oracle’s Remaining CAPEX Obligation: Q2 FY26, Oracle Still Can’t Build Data Centers: Q2 FY26, Oracle: Not Even a REIT?, They Still Don’t Have the Margins: Oracle Edition, They Don’t Have the Margins, They Don’t Have the Money, They Don’t Have the Money: Oracle and Tik Tok, Why Can’t Oracle Afford Data Centers?, Bronny’s Boffo Bid
Never Take a Dependency on Elon Musk: Permitting Edition
So what exactly did Ghori reveal on Relentless? Well, he seemed to tip off the possibility that xAI has been skirting regulations and getting dubious permits when building data centers—specifically, its prized Colossus supercomputer in Memphis, Tennessee. “The lease for the land itself was actually technically temporary. It was the fastest way to get the permitting through and actually start building things,” he said. “I assume that it’ll be permanent at some point, but it’s a very short-term lease at the moment, technically, for all the data centers. It’s the fastest way to get things done.”
When asked how xAI has gone about getting those temporary leases, Ghori explained that they worked with local and state governments to get permits that allow companies to “modify this ground temporarily,” and said they are typically for things like carnivals.
Shocked, shocked to learn fractional CEO and carnival barker Elon Musk is playing fast and loose with local governments. For a world class stock tout and personal brand magician, he’s remarkably oblivious to the state of his AI brand and its implications for generating AI revenues.
In other dependency news, Anthropic cut off xAI’s use of Claude Code. Easy to imagine some model distillation going on…
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Creatives Lacking Creativity
“Driven by fierce competition for leadership in the new GenAI technology, profit-hungry technology companies, including those among the richest in the world as well as private equity-backed ventures, have copied a massive amount of creative content online without authorization or payment to those who created it,” a press release reads. “This illegal intellectual property grab fosters an information ecosystem dominated by misinformation, deepfakes, and a vapid artificial avalanche of low-quality materials [‘AI slop’], risking AI model collapse and directly threatening America’s AI superiority and international competitiveness.”
First, any LLM could come up with a better pastiche of criticisms than that jumble of inconsistencies.
Second, the self-described “creatives” might be better described as “rich winners” who prevailed in the last generation and now don’t want anything to change or impact their residuals.
Nothing brings out rent-seeking and Luddism like the arrival of new technology in Hollywood (e.g. TV, the VCR, DVDs, Internet). Those “creatives” have some constitutional requirement to bitch and moan about anything new as opposed to exploring its creative potential. Then they eventually come around, embrace the new technology, and do just fine.
This is a great time for actual “creatives” to embrace new tools and create new IP, as the incumbents cling to their old ways to crank out endless remakes and sequels of existing ideas.
Quick Hits
Here we relegate 1.) punchlines you can write yourself 2.) topics I’ve beaten to death and/or 3.) uncharacteristically succinct interludes.
- Great piece from Om on how velocity dominates the media world.
- EU Sanity? German Chancellor Merz: “We must substantially reduce bureaucracy in Europe. The single market was once created to form the most competitive economic area in the world. Instead, we have become the world champion of overregulation. That has to end.” (the usual caveat applies: Europe is great at words, not so much at acting on them).
- EU Sanity? Germany Chancellor Merz says it was a ‘serious strategic mistake to phase out nuclear energy’.