🚀 OpenAI's $150 billion valuation

OpenAI wants a few more billions on its books, Europe got another rate cut, and Mark Cuban's mission to break stuff | [Finimize](   TOGETHER WITH     Hi {NAME}, here's what you need to know for September 13th in 3:15 minutes.   🍿 The cheerleader and jock are never the stars of the romcom – that role's reserved for the kooky character. So join our [Modern Investor Summit]( to hear from iCapital CEO Lawrence Calcano, and discover the charm of alternative assets. [Grab your free ticket]( Today's big stories - OpenAI’s valuation is set to hit $150 billion, with tech giants said to be ready to line its coffers - How to build wealth in a market full of duds – [Read Now]( - The European Central Bank cut interest rates to 3.5%, eager to let the region’s economy breathe a little easier ChatterBots [ChatterBots] What’s going on here? ChatGPT-creator OpenAI has [entered]( talks to raise $6.5 billion at a $150 billion valuation, and its loyal league of chatbot communicators seem happy to oblige. What does this mean? ChatGPT has become the holiday planner, live-in doctor, and work assistant for millions. And now, the chatbot’s creator wants the favor returned. OpenAI is fundraising at a valuation of $150 billion – a serious upgrade from $86 billion earlier this year, and enough to solidify its spot among the world’s top startups. Insiders say long-time investor Microsoft is eager to contribute, along with Apple and Nvidia. And as many tech giants have done before, OpenAI is cozying up to banks to secure a $5 billion revolving credit line – funds that borrowers can access, repay, and then borrow again. Why should I care? For markets: A high-tech house of cards. OpenAI should have no problem burning through that cash: AI’s an expensive business, with data centers and cutting-edge development to fund. But with companies and investors throwing billions into the sector, an increasing number of skeptics are wondering when – if ever – those investments will pay off. Sequoia Capital believes that to cover this year's spending on data centers and chips, AI must make $600 billion in revenue. But so far, analysts estimate it’s only pulling in tens of billions: petty cash, for tech. The bigger picture: Old dog, meet new tricks. The AI all-stars are as expensive as they are enticing, so many investors are swapping out the likes of Nvidia for more affordable tech stocks. Take IBM, for example. One of the original tech giants, the company’s been investing in AI initiatives – yet, it’s still trading for less than the buzz-worthy names and the Nasdaq 100 index. That’s winning over investors who value, uh, good value: the stock is up 30% this year, recently hitting a record high for the first time in over a decade. You might also like: [AI meets blockchain, and where to find opportunities](. Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=ChatterBots&utm_campaign=daily-global-13-09-2024&utm_source=email) Analyst Take Most Stocks Lose Money, Actually [Most Stocks Lose Money, Actually]( [Photo of Stéphane Renevier, CFA] Stéphane Renevier, CFA, Analyst Most investors know that the [stock market]( can offer solid long-term returns, but here’s a surprising reality: the majority of individual stocks actually lose money. In fact, nearly all the [wealth generated]( in the stock market comes from a very small number of shares. Let’s take a look at what that means for your [portfolio strategy](. So that’s today’s Insight: [how to build wealth in a market full of duds](. [Read or listen to the Insight here]( SPONSORED BY BELONG The earlier you start investing, the more your returns can compound over time If you want to start investing as a young whippersnapper, you have at least three options: One: invent a time machine. Two: ask your parents for a small loan of a million dollars. Three: you could use [Belong’s “Boost loan”]( to multiply your starting investment value and, in turn, your potential returns. (Please note, as with all investing, your capital is at risk, and a Boost loan increases both the risk of loss as well as the opportunity for higher returns.) You can repay the loan’s [competitive rate of 6.9% APR]( in small monthly instalments. Plus, it’s designed to be fully paid off over five years, so you won’t get hit with a lump sum at the end. The first batch of Boost loans launched this week: you can [join the Belong platform to register your interest for a loan](, and use the code [INDEXFUND]( to skip the waitlist. [Find Out More]( Avione Saving & Investment Ltd (trading as Belong) is a credit broker, not a lender. Boost loan approval is subject to affordability and eligibility criteria. When you support our sponsors, you support us. Thanks for that. If you want your brand featured here, [get in touch.]( Bail Out [Bail Out] What’s going on here? The European Central Bank (ECB) [cut]( interest rates to 3.5% on Thursday, after the economy sent out more than a few SOS signals. What does this mean? High interest rates have brought European inflation to within touching distance of the central bank’s 2% target. So now, the ECB can focus on addressing the economy’s cries for help. See, European households aren’t spending enough to keep the economy on track, and manufacturers are seeing international customers pull back on spending. That slowdown has already forced the central bank to slash its forecasts for the next two years. So it makes sense that it reached for the scissors on Thursday, trimming rates by 0.25 percentage points for the second time this year – a move that ought to encourage businesses and shoppers to spend more. And despite inflation ticking up in the services sector, traders are expecting at least one more 0.25 percentage point cut this year – if not two. Why should I care? For you: Resume the house search, Europe. Thursday’s cut will likely be toasted by would-be homeowners. High rates have seriously put folk off home loans – in fact, mortgage lending in Europe is predicted to flatline this year for the first time ever. That’s a big deal: mortgages make up nearly half of all the loans in the region. And when borrowing slows down, an economy usually does too. For markets: Eyes on the targets. Rate cuts weren’t the only reason investors had eyes on Europe this week. Shares in Commerzbank picked up by 17% on Wednesday, after UniCredit revealed it had built up a 9% stake in the banking institution and initiated talks of a merger. If it goes through, the deal would create the biggest lender in Germany. JPMorgan analysts think that could set off a wave of mergers and acquisitions across the European banking sector, pushing up the stocks of banks that look like tidy targets. You might also like: [How interest rates influence every investment you make](. Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Bail Out&utm_campaign=daily-global-13-09-2024&utm_source=email) 💬 Quote of the day "What you do today can improve all your tomorrows." – Ralph Marston (an American football player) [Tweet this]( 🚀 Get the inside scoop from the biggest leaders in finance Are you in financial services or fintech? We've got something for you. Introducing our [new monthly newsletter]( featuring top insights from leaders at UBS, Citi, BlackRock, Revolut, and more. Get actionable advice on marketing, product building, and leadership in financial services. 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