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Oracle’s AI Order Shock: The Week Tariff Fears Died

Published on September 14, 2025

Jordi Visser

In this week’s video Oracle’s blowout quarter eclipses CPI prints and jobs benchmark revisions. A $317B QoQ surge in AI orders (pushing backlog toward the mid-$400Bs) signals an acute inference capacity shortage and elevates AI from a “tech story” to a macro driver of power, grid, and compute build-outs. Ellison is now negotiating at the CEO/head-of-state level; the takeaway is to position for hybrid power solutions (gas, renewables, storage, grid equipment) and compute enablers (HBM, networking), with knock-on opportunities across names tied to data centers and energy infrastructure.

By contrast, many investors focused on 3.1% core YoY and labor revisions rather than see them as “noise” and the official ending of tariff related fears. Inflation swaps eased, 10-year yields fell to 4%, mortgage rates have now fallen ~150 bps from their peak, and crucially despite more stagflation talk, profit margins remain firm rather than compressing (the opposite of classic stagflation). With the Fed cutting into an AI/manufacturing upswing and sentiment still overly bearish, bonds may remain “uninvestable” but they remain a distraction with better risk/reward sitting in AI capex and power bottlenecks, especially now validated at the unprecedented scale described by Oracle.

Timestamps

(00:00–00:24) Event & Market Tone
Thanking attendees of recent events. Emphasizes enthusiasm in markets, with focus on Oracle’s massive move and the week’s broader themes.
(00:24–01:17) Tariff Fears End & Fed Cuts
Declares the “official end” of tariff fears. Inflation data behind us, Atlanta Fed GDPNow at 3%. Fed cutting rates while AI-driven manufacturing buildout accelerates. Warns against academic and bearish driven headlines like “stagflation” or “AI bubble.”
(01:17–02:52) Weekly Market Recap & Bonds
S&P +1.5% for the week, Russell up 6 weeks in a row. Oracle up ~40% in one day, finishing +25.5% for the week. Bond yields briefly dipped below 4%, finishing 4.06%. Bond volatility at multi-year lows, credit spreads at multi-decade tights. Says bonds remain “uninvestable” despite bears betting on higher yields.
(03:14–04:32) Housing & Jobs vs AI Impact
30-year mortgage rates now at lows since early 2023, down 150 bps from peak. Trump/Bessent emergency housing actions likely; stay long housing. Jobs weakness increasingly tied to AI. Despite weaker labor, corporate profit margins remain strong.
(04:32–07:45) Inflation Data & Stagflation Pushback
CPI came in soft; core YOY at 3.1%. Argues inflation levels (2% vs 4%) irrelevant, profits matter. Calls stagflation a “garbage word” in the AI era since margins are rising, not compressing. Swap market pricing shows tariff inflation fears overblown.
(07:45–09:20) Profits & Sentiment Disconnect
Corporate earnings and profit margins remain resilient. Forecast revisions for Q3 are the strongest in decades. Employment trend signals weakening, but economy overall strong. Despite near all-time highs in stocks, investor sentiment remains deeply bearish.
(11:09–13:43) Prometheus Macro (Aahan Menon) Takeaways
US economy in business cycle expansion: resilient consumer spending, modest capex, loose financial conditions. 90% of PCE categories expanding, no consumer-led slowdown. Labor looks weak due to AI. Manufacturing showing early recovery; PMIs could hit 60 in 2026. Commodities constructive, bonds unattractive.
(14:23–19:32) Oracle’s Massive AI Orders
Oracle reported $317B increase in RPO orders QoQ (up 359% YoY), pushing backlog toward $500B. Demand driven by inferencing capacity shortages. Ellison now negotiating directly with CEOs and governments. Oracle’s order surge equals ~81% of US quarterly GDP. Estimated power needs from Oracle’s AI contracts equal a large amount of US electricity demand.
(20:13–24:22) Power & Hybrid Solutions Theme
AI is a macro theme, not just tech. Power needs cannot be met by nuclear/fusion alone; require hybrid solutions across gas, renewables, batteries, and grid upgrades. Identifies 100 public companies across the supply chain (transformers, switchgear, construction, commodities) positioned to benefit. Examples: Mastec (engineering, data center buildouts), Antero (natural gas).
(26:16–29:30) Energy & PMI Cycle
Energy companies like Bloom Energy and Babcock & Wilcox benefiting from AI-driven demand. Notes correlation between rising PMIs and oil/natural gas prices, expects floor in energy prices as PMIs recover. Sees rotation into energy sector as AI power needs rise.
(30:52–34:38) Tesla’s Role in AI Infrastructure
Tesla’s Megablock storage systems can power 400k homes in a month—ideal for AI data centers. Oracle alone represents ~$19.2B revenue opportunity for Tesla storage. Musk validated this approach via Colossus center in Memphis. Predicts Tesla could double or triple next year driven by robo-taxis and humanoids.
(34:38–36:39) Broader AI & Global Markets
Google Cloud forecasts $58B AI revenue by 2027. OpenAI capex projected $115–150B. Warns misallocation of resources is likely, but capex boom will continue. Notes China as 2025’s best-performing equity market (+38% YTD), contrasting with flat Europe.
(37:36–40:33) GPT-5 Pro, Bitcoin & Crypto
Praises GPT-5 Pro as transformative for research and problem-solving. Bitcoin consolidating but likely poised for breakout ahead of Fed rate cuts. Sees 2026 as a “third wave” Elliott Wave move in crypto, expects explosive upside as AI, energy, and innovation cycle overlap with monetary easing.
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