Anthropic S-1 Shows Red-Hot Growth, Risks and Massive Computing Costs
(…) The disclosures, many of which have not previously been reported, are part of a draft initial public offering prospectus viewed by The Wall Street Journal that revealed the firm’s financials for the first half of the year. (…)
Anthropic generated around $16.3 billion in revenue in the six months ended June 30, up from $1.1 billion in the year-earlier period, according to the draft prospectus. During that period, Anthropic spent nearly $9 billion on computing capacity and infrastructure, up from $2.3 billion spent on infrastructure during the same six months in 2025. (…)
The company is on the hook to pay around $450 billion in cloud computing agreements over the next seven to ten years. The bulk of these deals are noncancelable.
Anthropic plans to spend $111 billion on Google cloud computing contracts, $110 billion with Amazon Web Services, and $31 billion on Microsoft, “regardless of actual usage.” The firm also agreed to spend up to $86 billion renting Nvidia chips from smaller AI cloud providers Nscale and Lambda through 2033 and 2034, respectively, in addition to other cloud deals.
Including its more than $160 billion obligation to lease Google chips in a deal with Broadcom, Anthropic’s future infrastructure costs top $600 billion. The firm is negotiating additional computing deals that could see its commitments rise by as much as $150 billion, the materials show.
While most of its capacity comes from large cloud providers—including Amazon Web Services, Google and Microsoft—Anthropic is hitting limits. The company said it has sought access to more capacity than “those partners were willing to provide” and they increasingly see it as a competitor, according to the prospectus.
From this rather limited disclosure, there seems to be a 44.8% operating margin in the first 6 months of 2026.
Japan ‘months’ from running out of critical rare earth as China squeezes supply
(…) Washington has urged China in recent months to increase the flow of rare earths, including yttrium — a heat-resistant metal crucial to manufacturing vehicles, jet engines and semiconductors — to the US and its allies. US defence supply chains rely on components made in Japan that contain yttrium.
Unless Beijing changes tack or western allies find substitutes or additional stockpiles, shortages could emerge as early as the end of this year, Japanese government officials and trading house executives said.
“We’re in a serious situation to keep supplying downstream industries,” said a Japanese government official. “Stockpiles are decreasing and rare earth saving efforts have a limit.” “The timeline is not years, it’s months and how to survive next year,” the official added.
“If everyone acts right now, then it will be OK. If everyone ignores the problem, then it will be a systemic risk to the world economy.” (…)
Yttrium shortages have become the biggest pain point for Japanese materials groups. The metal is used to coat engines and plasma-etching chambers for chip manufacturing.
Yttrium oxide prices outside China have skyrocketed to $1,150 per kilogramme, a 179-fold increase versus two years ago, compared with $9 per kilogramme in China, according to price assessments by Argus. (…)
US officials have told Beijing that the US will not export jet engines needed for the Comac C919 — China’s first domestically made airliner — as production has been constrained by the lack of yttrium, which is critical to making turbines.
China also agreed to buy 200 Boeing jets when Trump visited Beijing in May. But the deal has not been completed, partly due to complications related to critical minerals.
Erin Browne, the top US Treasury official for international affairs, told the FT that rare earths were essential to the production of Boeing aircraft and jet engines.
“In order to produce aircraft, you need rare earths,” said Browne. “They’re all sort of under the same umbrella, which is that in order to . . . export engines, you also need rare earths.” (…)
Housing Starts Significantly Below Expectations
- Housing starts declined 5.2% to 1,221k in September, significantly below expectations. August starts were revised down 3.3pp to -5.9%.
- Both single-family housing starts (-4.6%) and multi-family housing starts (-6.7%) declined this month.
- Building permits decreased 0.2% to 1,400k; single family permits: -4.0%, multi-family permits: +6.1%.
The Immigration Crackdown Is Making It Much Harder to Build Houses Home building suffers labor shortage that is freezing projects and raising costs
Nearly two-thirds of builders said immigration enforcement is affecting their labor force, up from 23% in March and 13% a year ago, according to a September John Burns Research & Consulting survey.
“We’re almost dead in the water because our workforce is gone,” said Scott Brannock, president of Jacksonville-based Tidewater Homes and the Northeast Florida Builders Association. “We have national builders who are missing projections, losing hundreds of thousands of dollars because they have slabs sitting on the ground and no one to frame.”
A September survey from the National Association of Home Builders found the cost of labor had increased a median of 4.2% from the previous year.
The shortages come as the country desperately tries to drive down sky-high housing costs that have trapped millions of Americans out of homeownership and stalled sales.
Immigration raids have primarily hit trades such as roofers, painters and framers. Meanwhile, the data center build-out in some areas has siphoned off specialized trades, drawing HVAC technicians and electricians with lucrative wages that home builders struggle to match.
Immigration-enforcement advocates say that deportations will drive down housing costs by removing competition for housing. They say builders should hire U.S. citizens. (…)
Over the summer, the Jacksonville, Fla., area became a hot spot for arrests of residential-construction workers, with some subcontractors estimating 70% of their workforce has been lost. But the immigration crackdown has also started hitting builders in wider swaths of the country.
“It seems to have become ubiquitous,” said Jim Tobin, NAHB chief executive.
Paul Schwinghammer, co-founder of Hallmark Homes and former president of the Indiana Builders Association, estimated that in Indiana, immigration enforcement has taken out up to 25% of the residential-construction workforce.
In 2024, immigrants accounted for 26% of construction workers, a record high, according to the NAHB. (…)
Hacker said he has seen a 70% reduction of crews available for certain jobs, forcing the leftover crews to double their rates in most cases. He has also started a campaign to recruit new workers, offering significant cash bonuses for applications. (…)
The arrests have also spooked foreign-born workers with legal status, some of whom have been caught up in raids and repeatedly detained, taking them away from the job site for days at a time, builders and subcontractors say. Many legal residents have stopped showing up to work or fled to other parts of the country out of fear.
“People are afraid. If there’s any wind of anything happening, they’re not coming in for a week,” said Matt Risinger, a builder in Austin, Texas.
A June National Bureau of Economic Research paper found that each single arrest by U.S. Immigration and Customs Enforcement causes an average of seven likely undocumented immigrant men to stop working.
Building a house is largely a linear process—one stage can’t occur until another has been completed. “That costs money in interest, site labor, site management, rental equipment, utilities, insurance,” said Schwinghammer, the Indiana builder.
And even if contractors are able to find workers, the labor shortage means they have to pay them significantly more. Brannock, the Jacksonville builder, said local framers’ wages used to work out to around $20 an hour. Now, that is up to $40 to $45 an hour. For the average 2,500-square-foot house, framing labor, which used to cost $10,000, now runs builders $25,000 to $28,000, he said. (…)
Builders and subcontractors say it will be costly and time-consuming to replace workers like Velazquez with U.S. citizens. “There’s no one lining up to do a lot of these jobs,” said Josh Putnal, the owner of a siding-and-soffit subcontractor in Jacksonville.
Last week in the NYT:
Each year, thousands of immigrant workers travel hundreds of miles to clear toxic debris, haul away fallen trees and begin reconstruction in the aftermath of hurricanes.
But as residents start returning to Pensacola, Fla., and other areas where Hurricane Isaias ripped off roofs and toppled trees onto houses last week, workers and organizers warn of a potential labor shortage fueled by fear of the Trump administration’s immigration crackdown.
On Sunday, Immigration and Customs Enforcement confirmed that three undocumented immigrants were taken into custody after they were stopped by sheriff deputies in the town of Milton, which sustained significant damage.
The workers were part of a crew that had arrived from the Midwest, said Saket Soni, executive director of the disaster-worker advocacy nonprofit Resilience Force.
“Other workers who heard about this immediately laid down their tools and fled the area, abandoning hurricane-repair jobs,” said Mr. Soni, whose organization represents about 7,500 workers.
He added that people preparing to deploy to the area were holding back. Many disaster response workers are undocumented. (…)
China Home Price Slump Eases, Fueling Hopes for Recovery
New home prices in 70 cities, excluding state-subsidized housing, dropped 0.14% from August when they slid 0.17%, figures from the National Bureau of Statistics showed on Monday. Resale home values, which are subject to less government intervention, decreased 0.26%. (…)
Values of used homes improved across the board last month. Top-tier cities saw prices of existing homes climb an average 0.23%, faster than the 0.08% increase a month earlier, while declines narrowed in both tier-2 and tier-3 cities on average. (…)
Trump’s New Global Triumvirate? His Yalta 2 courtship of Putin and Xi could blow up alliances at home and abroad.
(…) “Anything I can do to end the war, whether somebody’s there or not, whatever I can do to end the war.” The President in recent weeks has waived new oil tariffs and sanctions on Russia and offered Mr. Putin’s war machine a cash infusion by letting Russian diesel flow into global markets. (…)
A new triumvirate that divided the world into spheres of influence would blow up America’s global credibility as a reliable ally. (…)
Any coerced peace in Ukraine would divide NATO and broadcast to America’s Pacific allies that the U.S. is a dangerous friend. As a practical matter we doubt even Mr. Trump could force Ukraine into capitulation, and the President would own the ugly scenes of carnage that followed if he pulled intelligence and targeting help. (…)
Handing over Europe to Russia, and the Pacific to China, would open a major [republican] party division. Mr. Trump may be two weeks from being a lame duck, and maybe some GOP Senators will finally find the courage to speak up. (…)
(…) Desperate to reduce gas prices before the midterms, he is now helping Mr. Putin wage war. (…)
Let us be clear about the scope of Mr. Trump’s cynicism. He is aiding an autocratic leader and dangerous adversary of the United States who is waging a brutal war against a democratic neighbor. Mr. Trump is doing so partly in the faint hope that gas prices, which have jumped because of his reckless war in Iran, will fall over the next two weeks and help Republicans avoid big losses in the midterm elections. He is damaging America’s national interest, and likely sacrificing Ukrainian lives, for his own political interests.
The stakes in Ukraine are much larger than the fate of one nation. The war is a test of whether authoritarian expansion can succeed by military force in the 21st century — or whether the West can rally to protect democracy and innocent lives. (…)
Mr. Trump’s solicitousness of Mr. Putin instead encourages him to become more aggressive, in Ukraine and beyond. Seeing the West as weak and divided, Mr. Putin has started a campaign of barely disguised attacks and provocations against other parts of Europe. (…)
“We are already in conflict with Russia,” Chancellor Friedrich Merz of Germany has said. (…)
Mr. Trump, by contrast, offered this disingenuous assessment on Monday: “Russia, frankly, has been fine on Ukraine.” (…)
The people of Ukraine have shown inspiring bravery over the past four and a half years. They defied expert predictions and rebuffed Russia’s invasion. More than 125,000 of them have been killed, and another half million have been wounded. Many live with daily fear and are preparing for a difficult winter. They are fighting a battle that benefits the entire free world. Mr. Trump is fighting only for himself.
(…) Last week, Musk capped the speeds at which Ukrainian hardware could stay connected to the satellite-based network, the people said, rendering some offensive drones and interceptor drones virtually useless.
Musk and Trump discussed the Starlink decision in a call soon after the slowdown became public, while the president was campaigning last week, two of the people said. One of the people also claimed Musk and Trump discussed the matter prior to the decision to throttle Starlink. (…)
During the uproar, SpaceX representatives called White House counterparts seeking a unified understanding and subsequent message that the company and Trump administration coordinated ahead of Musk’s directive, the people said. (…)
Some U.S. officials say that Musk acted unilaterally and that Trump didn’t specifically order any retribution against Ukraine. But a person familiar with the situation said Musk talked to multiple senior administration officials, including with Trump, before imposing the new speed cap, which Ukrainian officials said had allowed Russian missiles to evade their defenses. (…)
The episode has spiked U.S.-Ukraine tensions to their highest level since Trump berated Zelensky in the Oval Office last year. But it has also highlighted the singular influence of Musk over the war, as Starlink provides a lifeline for Ukrainian forces on the front lines attacking Russian troops and defending themselves from strikes. With a seeming flick of a switch, Musk has the power to alter the course of a deadly conflict. (…)
Recall that Musk last week said that Starshield, the military-grade sister service to Starlink, “is controlled by the US government”, and “any limits on speed or usage are decided by the US military and ultimately POTUS. 
- Airfield Attack Marked Opening Shot in Putin’s Sabotage Campaign Against Europe The Russian leader ordered new wave of attacks against NATO countries
(…) U.S. intelligence agencies say the failed operation at Leipzig-Halle Airport this summer was one of the opening shots in a stepped-up campaign of sabotage and covert action against NATO countries ordered directly by Russian President Vladimir Putin, according to European officials briefed on their findings. (…)
Aides to German Chancellor Friedrich Merz say that if the Leipzig attack had resulted in large numbers of casualties, they would have considered invoking the collective-defense provision of the North Atlantic Treaty Organization, known as Article 5, which would oblige the rest of the alliance to rally to protect Germany. (…)
Since the Leipzig attack, European countries have seen a sharp uptick in so-called gray-zone assaults. In August, arsonists struck drone manufacturers in Estonia and Poland. That same month, Slovak authorities said they thwarted a planned arson attack on a Ukrainian drone factory there.
The attack was part of a broader effort to position agents, explosives and weapons across Europe to strike targets supporting Ukraine and sow chaos that could strengthen political opposition to military aid for Kyiv, according to investigators and intelligence officials.
After the failed attack, a Kremlin official serving as a back channel to the German government contacted his counterpart in Berlin, according to officials familiar with the exchange.
Leipzig, he warned, wouldn’t be the last attack.
In recent weeks, Poland, Lithuania and Bulgaria have all reported sabotage attacks on Starlink stations. There has also been a series of drone attacks on commercial ships in the Black Sea, near the waters of NATO members Bulgaria and Romania.
European leaders are publicly warning about the risks and privately debating how best to respond. “Russia is waging a war on Europe; not just on Ukraine, but also against us,” Merz said earlier this month. (…)
Secretary of State Marco Rubio warned earlier this month that the escalation could spill into NATO countries and “quickly turn what is a war between two countries into a much broader and far more dangerous regional conflict.” (…)
[CIA Director] Ratcliffe personally warned European intelligence counterparts and selected political leaders that Moscow was intensifying sabotage operations against their countries, according to people who received the warnings.
Oh! About the other war:
Trump Envoy Tells Nervous Gulf Allies U.S. Can’t Guarantee Security Forever
Tom Barrack, the U.S. ambassador to Turkey and President Trump’s special envoy for Syria and Iraq, said the grand bargains that have underpinned global security for decades are undergoing major transformation, and countries in the Middle East and elsewhere should focus on securing themselves via regional partnerships.
“America as the guarantor to the world, for the last 80 years, it is no longer there,” Barrack said at the Global Security Forum in Doha, an annual summit that brings together top security officials and experts from around the world. “What’s happening in this administration is not an abandonment. It’s a message for realignment.” (…)
Arrangements forged in the wake of World War II—essentially a quid pro quo whereby the U.S. provided security in exchange for oil—no longer fit Washington’s imperatives, Barrack said. Americans don’t want to sacrifice their lives for the Middle East, and Gulf states know the U.S. can’t assure their security, he said. (…)
“We don’t have a playbook,” he said. “We’re all on audibles. We can go one play at a time.” (…)
The GCCs will eventually wake up to their new reality: the US has benefitted from its war with Iran by grabbing energy market shares from the GCCs:
- US exports of crude oil have increased 33% since the start of the Iran war.
- Refined product exports also rose sharply: diesel +69%, jet fuel +39%, and residual fuel oil +51%.
- Liquefied petroleum gas exports increased as well: propane and butane +24% and +67%, respectively. Naphtha exports, essential for petrochemical production, also surged.
- US Liquified Natural Gas exports jumped 14%.
All at much higher prices and margins.
Once the war ends (?) and the GCCs resume shipments, they will find it difficult to negotiate their former clients back to unsecured supplies. The end of OPEC. Energy price wars ahead!
Trump’s approval falls to record low of 31% as midterms near, Reuters/Ipsos poll finds
- Musk has spent $276 million on midterms to help Republicans retain control of Congress
- Trump PAC Unleashes $277 Million to Aid Republicans in Midterms
(…) In a Truth Social post Tuesday, Trump wrote that he would spend more than $400 million to help Republicans in the November midterm elections, seeking to reassure the GOP it will have adequate funding as the political environment worsens for the party. He added that he had already spent $300 million. (…)
Would Trump accept GOP midterm losses? 7 in 10 Americans doubt it.
Most Americans are confident that next month’s midterm elections will be conducted fairly, but 7 in 10 lack confidence that President Donald Trump will accept the results if Republicans lose, according to a poll by The Washington Post, ABC News and Ipsos.
The doubts extend into Trump’s own party. Thirty-six percent of Republicans say they are not confident Trump would accept GOP losses, along with 77 percent of independents and 94 percent of Democrats. Yet Democrats and Republicans agree nearly identically on whether the elections will be fair and accurate: 70 percent of Democrats and 67 percent of Republicans say they are confident.
Another WaPo poll:
Nearly 2 in 3 Americans say President Donald Trump is using the presidency to enrich himself — and most of the increase over the past year has come from people who lean Republican, according to a Washington Post-ABC News-Ipsos poll.
Among Republicans and independents who lean Republican, 34 percent believe Trump is enriching himself, up from 22 percent in September 2025. Democrats and Democratic-leaning independents were already nearly unanimous, at 88 percent a year ago and 92 percent now, while independents who don’t lean toward either party were unchanged.
Trump Pushes to Evict the Press From the White House President Trump has talked about replacing the James S. Brady Press Briefing Room with an indoor swimming pool.
Simply replacing a pool of reporters…