Chip Stocks Crash, $20B Fund Margin Called, Frontier Labs: SLOW DOWN AI, Mamdani's Grocery Stores
In a Nutshell
Leopold Ashenbrenner's $20B AI hedge fund got margin-called after running extreme leverage on chip stocks, forcing liquidation of his entire public portfolio as the Philadelphia Semiconductor Index entered bear market territory with over $1T in combined market cap losses. Frontier AI labs (Anthropic, OpenAI) are petitioning for government regulation to "pace" development while simultaneously bulk-buying and shredding physical books for training data, with both companies seeing explosive revenue growth but facing open-source competition from Chinese models at 90% lower cost. NYC's planned government-owned grocery stores offering 30% discounts one week monthly represent socialist policy expansion that will lose ~$200M annually, while 64-dimensional neural network research suggests consciousness emerges from biological complexity far beyond current silicon models.
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The Core Four podcast panel discusses current market conditions. They note the podcast has been trending in the top positions globally and in the US. The host apologizes for forgetting his Starlink device while traveling.
One panelist reports five major enterprise leads. Enterprise sales is described as "chunky" but with "ginormous" deal sizes. The panel asks David Sacks for advice from his Yammer enterprise sales experience. Sacks advises against using leverage, stating "leverage equals risk of ruin." The panel agrees with a PSA that "no leverage" should be the approach.
The panel discusses Leopold Ashenbrenner, a 25-year-old hedge fund manager who left OpenAI two years ago to start his own fund. According to breaking news on Thursday, he received a margin call and had to sell his entire public portfolio to cover massive losses from leverage. Citadel reportedly bought his positions. Ashenbrenner reportedly started his fund with $225 million in 2024, grew it to $20 billion, then to $45 billion, achieving 200x returns by trading on leverage. At the end of June, he was reportedly up 450% for the year.
The NASDAQ's Philadelphia Semiconductor Index is down over 20% over the last month, entering bear market territory. The index includes the top 30 US listed chip companies including Nvidia, TSMC, AMD, and Micron. The index bounced back 7% on the day of taping. Samsung is down 38% over the last month. SK Hynix is down 14% since going public three weeks ago. South Korea's version of the S&P 500 (KOSPI) is down over 40% in the last 40 days. Between last Friday and Wednesday, leading chip companies shed over a trillion dollars in market cap combined.
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