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|  |  | Thursday, December 11, 2025 | |  | | Photo by Samuel Boivin/NurPhoto via Getty Images | Good morning, Quartz readers! It’s Shannon Carroll with the Daily Brief. Today, AI money is running in circles, the Fed is cutting in the dark, Elon Musk is swearing off government “efficiency,” and Google is quietly wiring a little apology back into your account. | | HERE'S WHAT YOU NEED TO KNOW | A top economist is worried about a jobs
recession. Mark Zandi says many Americans already live “on the financial edge” as unemployment is high and layoffs tick higher in a “low-hire, low-fire” market. | Trump is telling Americans to live with less. At a rally, he said kids don’t need 37 dolls as his tariffs push toy prices higher — with conservative voices warning that this is a strange sales pitch in an inflation-weary country. | Musk wouldn’t do DOGE again. He says the department was only “somewhat successful” after layoffs, backlash, and Tesla owners burning cars helped sour both his brand and DOGE’s claims of $214 billion in savings. | SpaceX is lining up the richest IPO in history. A mid- to late-2026 IPO could raise more than $30 billion at a $1.5 trillion valuation, asking investors to pay startup-style multiples for rockets, Starlink, and off-planet data centers. | | | SPONSORED |  | The best time to forecast? Now. | Q4 is the perfect window to turn this year’s numbers into a clear, actionable forecast aligned with your goals.
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Download The Financial Planning Playbook: 10 Strategies for Small Business Growth today. | | |
| | FULL-CIRCLE FUNDING | A growing chorus is looking at the AI economy and seeing a boom that’s starting to eat its own tail. Analysts are
calling this a “circular” economy; social media is calling it a “three-companies-in-a-trench-coat” economy. AI capex is exploding as data-center and GPU plans swell into the hundreds of billions, but some are worried that the money keeps cycling through the same small cast of companies. Goldman Sachs recently wrote that “AI bubble concerns are back, and arguably more intense than ever,” pointing to “the increasing circularity of the AI ecosystem,” while the Bank of England’s latest Financial Stability Report warned that valuations for
AI-focused tech stocks look “materially stretched.”
Underneath the buzzwords, the mechanics are pretty simple. “New” AI dollars leave corporate budgets as long-term cloud or GPU commitments, land in contracts already earmarked for certain labs, and then get repackaged into loans, private-credit deals, and equity stakes. Oracle has pledged up to $300 billion of compute for OpenAI starting in 2027 and is racing to build the data centers to match, leaning on bond markets and private
lenders. CoreWeave turned racks of Nvidia chips into a $7.5 billion debt facility and an OpenAI contract book of about $22.4 billion, while Nvidia owns more than 5% of the company and has agreed to buy more than $6 billion of capacity back. OpenAI sits near the center of the roller coaster, leading one analyst to call it the “black hole of the circular economy.”
Some say the structure feels uncomfortably familiar — pointing back to the internet buildout and warning that “you could
get a bubble that essentially propagates itself,” even if this time much of the capital is equity, not debt. Nvidia has pushed back at the “circular” critique by stressing that its cross-deals are tiny relative to revenue and that the startups it backs mostly earn from outside customers, while telling investors that demand is “off the charts.” Morgan Stanley has framed AI spending as a longer-term profit cycle, and others say this doesn’t look like dot-com 2.0 — as long as today’s capex turns into durable cash flow. The loop-de-loop economy
keeps adding speed and height either way, and the real test now is whether enough paying customers outside that circle show up to fill all those data centers — or whether a handful of companies just keep buying one another’s tickets and calling it demand. Quartz’s Shannon Carroll has more on how AI capex keeps boomeranging among the same few giants. | | | RECOMMENDED READING | The future of tech, decoded.
Semafor Technology unpacks the ideas, innovations, and power shifts redefining the global tech landscape. From AI and machine learning to the startups and policies shaping the industry, each briefing delivers clarity and depth on the tech transforming our world
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| | | OFF THE CHARTS | The central bank just pulled off the rare “as expected” rate cut that still manages to feel risky. Policymakers delivered their third 25-basis-point reduction of the year on Wednesday, extending an easing cycle that
began in September — even though Washington’s shutdown has knocked out key gauges they usually rely on. October’s jobs and inflation reports were canceled, November data are stuck in a backlog, and the central bank is effectively easing into a fog with a mix of stale government numbers and private dashboards.
The data people can see isn’t exactly reassuring. Private-sector trackers such as ADP point to a job market losing altitude, especially for white-collar workers in tech and
consulting, with an estimated 32,000 private jobs shed in November and small businesses cutting 120,000 roles — the steepest pullback in more than two years. Hiring and quitting have slipped to cyclical lows, a sign that bosses and workers are both spooked. At the same time, long-dated Treasury yields have climbed back toward 2009 levels, a “bearish” move that suggests investors are rethinking how much more cutting the Fed can really do as inflation, though measured on lagging data, remains elevated and governments around the world keep issuing
more debt to fund swollen deficits.
That leaves central bank chief Jerome Powell on a very narrow ledge. Cut too quickly, and he risks reigniting inflation in a bond market that already looks jumpy; cut too slowly, and a softening labor market could snowball into 2026. Looming over every decision is the question of who will lead the Fed once Powell’s term ends in the spring — and President Donald Trump’s constant insistence that rate cuts are practically part of the chair’s job
description. This last cut of the year doubles as a stress test: of the Fed’s ability to steer through a data blackout, of bond investors’ patience, and of how much political heat Powell is willing to absorb while he keeps calling the shots. Quartz’s Catherine Baab has more on how blindfolded easing plays with Wall Street, Main Street, and Trump. | | | SPONSORED | | The best time to forecast? Now. | Q4 is the perfect window to turn this year’s numbers into a clear, actionable forecast aligned with your goals. Set your business up for a stronger 2026 with BELAY’s new guide.
Download The Financial Planning Playbook: 10 Strategies for Small Business Growth today. | | |
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