Musk Floats Mega-Merger, United CEO on Airfares & Fuel 10/21/26

Space Exploration Technologies

Across the shows: 19 speakers in other episodes, 13 bullish and 6 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalBullish

  SpaceX's compute buildout will be huge, about a quarter of US gigawatts, and needs roughly $400B of capital.

  On the earnings call SpaceX said it is standing up 200,000 GB300s per month, versus what used to be a year's worth of work, and expects 3 gigawatts by year-end and 10 gigawatts of compute next year. Gerstner notes the forecast for total US compute stood up next year is 43 gigawatts, so SpaceX alone would be about 25% of it. Funding that buildout needs roughly $400B of capital. He reads this as proof that Musk sees the company at the brink of superintelligence, and says whoever has the most capital, compute and data wins. He calls the biggest market debate whether there is enough capital and manpower to build US data centers. He also says SpaceX's free cash flow will help fund superintelligence. As an owner of both SpaceX and Tesla, he is bullish on the scale this buys.

  “He says he's gonna do that every single month. By the end of the year, three gigawatts. He says they're gonna stand up 10 gigawatts of compute next year. It's unheard of.”at 19:29

CoreWeave

Across the shows: 28 speakers in other episodes, 6 bullish and 21 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalUncertain

  CoreWeave is an extraordinary company but subscale, so it pays more for capital than SpaceX would.

  Gerstner says the market's recent swings in neocloud stocks reflect scale. CoreWeave is run by a great CEO and team, but it is subscale relative to SpaceX, which has better access to capital. He explains that lenders and equity investors apply a discount rate to uncertain future demand and charge a risk premium, especially when the borrower has little to collateralize beyond its GPUs. Those GPUs are easier to underwrite when they are Nvidia parts that many buyers can use, and harder when they are custom ASICs. Since CoreWeave lacks SpaceX's scale and financing access, it faces a higher cost of capital and more financing risk.

  “The problem is their subscale relative to SpaceX. ... when you're investing in somebody who doesn't have a lot to collateralize other than the GPUs.”at 20:47

Tesla

Across the shows: 5 speakers in other episodes, 2 bullish and 1 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalBullish

  A SpaceX-Tesla deal will need a premium above 30%, likely $420 to $550 a share.

  Gerstner says control premiums are typically 20 to 30%. He expects the Tesla special committee to go above 30%, because Musk sits on both boards and the committee has a unique fiduciary duty. A higher premium insulates the board from lawsuits. He also says the merger premium is partly already built into the stock, so it need not be measured from today's price. He estimates the final deal price at between $420 and $550 a share. He says scale would help SpaceX borrow and raise capital more cheaply, which he sees as one main motivation for the merger. As an owner of shares in both companies, he expects a premium for Tesla holders.

  “I actually think they'll air on the side of a higher than 30%... But I think you're going to see something between, you know, $420 a share and let's call it 520 or $550 a share.”at 22:11

NVIDIA

Across the shows: 22 speakers in other episodes, 18 bullish and 9 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalBullish

  Nvidia's glut bears have been wrong for two years; supply stays constrained by wafers and power.

  Asked when the shortage will turn into a glut, given margins of 75% at Nvidia and 86% at Micron, Gerstner says the glut callers have been wrong for two years and missed the upside. Nvidia is up 18x over the last three years. He argues there is a natural constraint: wafer production in the US can only grow so fast, and so can bringing power on. Unlike 2000, when demand was limited, today's demand for superintelligence is unconstrained while supply is physically limited. He also says Nvidia's GPUs are easier to finance than custom ASICs because many buyers can use them as collateral. Eventually a glut could come, but he thinks it will be far less than what the bears expect.

  “Remember, Nvidia, over the course of the last three years, is up 18 x. Right. You missed all of that because you were panicked two and a half years ago that there was going to be a glut. I actually think you have a natural constraint here.”at 25:00

Anthropic

Across the shows: 31 speakers in other episodes, 20 bullish and 39 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalBullish

  Anthropic's IPO could value it at $1.5T to $2T, based on 10-12x next-year GAAP revenue.

  Gerstner's Altimeter forecast puts Anthropic's next-year GAAP revenue at about $140-150B. He cites the company as high growth, cash-flow positive last quarter and fairly profitable per token. At an investor day in San Francisco with about 150 leading investors, he said sentiment was 10 out of 10, with expanding competitive moats and strong compute additions. Applying a 10x multiple gives about $1.5T and 12x gives about $2T, which he sees as the valuation range for the IPO.

  “But if you apply to 10 times multiple to that, Andrew, you get to 1,500,000,000,000. If you apply 12 times multiple, you get closer to 2,000,000,000,000.”at 38:55

OpenAI

Across the shows: 16 speakers in other episodes, 6 bullish and 15 bearish calls, past 30 days

• Brad Gerstner · Altimeter CapitalBullish

  OpenAI will very likely go public because it needs cheap capital, at lower multiples than past mega IPOs.

  Gerstner says a public listing is highly probable. He argues that the race to superintelligence is a recursive, capital-intensive battle, so OpenAI will need access to cheap public capital. He also argues it is good for America when retail shareholders can own these companies. He points out that the IPO multiples for these companies are lower than those of Facebook, Google and SpaceX at their listings, so he sees a wall of worry already built in.

  “I would say, from my perspective, it's highly probable they go public.”at 39:19

Airlines & aviation

• Scott Kirby · United Airlines

  Six to 10 US airlines will lose money this year, though airfares remain below 2019 levels in real terms.

  Kirby says six to 10 US airlines will lose money this year. Airlines are coming off the COVID low, and airfares are up sharply this year. Even so, after inflation, fares are still down compared with 2019. That means higher fares have not yet restored the sector's profitability. The clip is a short teaser, so the full argument is not shown.

  “Six to 10 US airlines are gonna lose money this year, and you're coming off of the COVID low. So while airfares are up a lot this year, they're still down in real terms compared to 2019.”at 1:27

• Scott Kirby · United Airlines

  Airspace capacity, not airports, is the main constraint on air travel and causes delays and cancellations.

  Kirby says airports are being upgraded across the country, citing United's new Houston terminal built in 33 months and Dulles going quickly. He argues that the bigger issue is airspace, which limits the number of flights. Using airspace efficiently and continuously when safe would do far more to cut delays and cancellations than new terminals. He says the FAA and the administration are on the right path.

  “The bigger issue for us is really getting the airspace. The constraint on air travel today is the airspace.”at 58:09

AI: overall outlook

• Brad Gerstner · Altimeter Capital

  We are entering superintelligence, and the winner will be whoever has the most capital, compute and data.

  Gerstner says Musk's announced compute ramp shows Musk understands the industry is at the brink of the singularity and entering superintelligence. The winner will be whoever has the most scale in capital, compute and data. He says most people in the industry forecast that demand will accelerate, even though the future distribution of outcomes is uncertain. Demand is unconstrained today, while supply is limited by physical constraints on power and chip production.

  “It makes very clear. Elon understands we're at the brink of the singularity. We're entering super intelligence, and whoever has the most scale... Capital, compute, and data wins the game of super intelligence.”at 20:22

• Brad Gerstner · Altimeter Capital

  AI will reach AGI within the next year as recursive self-improvement accelerates the race.

  Gerstner says the industry is in the foothills of the singularity and that things are accelerating. Frontier labs are racing to superintelligence, and once enough compute is built they enter a recursive loop that extends the leader's lead. He says Elon Musk, Larry Page and others think AGI is not as far off as most people believe, and he says AGI is coming within the next year.

  “But within the next year, we're at AGI.”at 41:44

US tax & spending policy

• Brad Gerstner · Altimeter Capital

  Trump accounts and stock gifts will channel trillions of dollars of philanthropy into children's accounts.

  Gerstner says the platform is the most disruptive direct charitable vehicle in the country. Single-page donor agreements with the Treasury let donors sponsor any zip code or state and send money straight to kids, cutting out intermediaries. He says America is the most giving country and that giving has been hard, so this should draw large bequests. He also says OpenAI and Anthropic will contribute, citing Anthropic's document about giving 5% of funding to citizen accounts.

  “We're gonna see trillions of dollars of bequests and other things flow through this platform because the reality is America is the most giving country on the planet.”at 43:24

• Scott Kirby · United Airlines

  Passive wealth growth escapes tax and should be taxed, while income taxes should fall.

  Kirby says wealthy people can invest and let money grow tax-free for life, and then get a step-up in cost basis at death, so the gains are never taxed. He says hardworking Americans pay about 40% of their income in tax, and that feels unfair. In his view, a system with lower income taxes and taxes on the gain in wealth would be fairer. He says this is one non-consensus view, not policy advocacy, and that there are many ways to do it.

  “Like, I think as a matter of fairness, passive wealth growth ought to be taxed somehow.”at 54:32

Telecom & connectivity

• Brad Gerstner · Altimeter Capital

  Starlink's odds of disrupting carriers have risen sharply, so carrier multiples should compress.

  Gerstner says the market sold off AT&T after its solid earnings because it is pricing a large disruption to carriers, not current results. The market is not saying SpaceX will certainly take them out, but the probability that SpaceX can compete with them has risen sharply. He expects SpaceX to become an alternative carrier with fast diffusion and high penetration, since carriers still leave dead zones. He argues that SpaceX's engineering and free cash flow will solve the coverage problem. So carriers' discount rates must rise and their multiples must come down. He calls the carriers' pushback a classic innovator's dilemma.

  “I'm not surprised that you report earnings and your stock goes down because the market doesn't really care about what your earnings are today. They're saying there's this massive disruption coming to your business.”at 26:47

AI regulation & safety

• Brad Gerstner · Altimeter Capital

  US frontier-model safety regime is the most robust in the world and is already slowing releases.

  Gerstner describes three layers. Commerce reviews every frontier model before release. A White House accord on superintelligence requires internal and external audits and board oversight, similar to Sarbanes-Oxley for AI companies. A task force led by Jay Clayton covers critical industries and cyber. He says the US is the only country to sanction a model and pull it using export controls. He credits pre-release review for the slower pace of frontier model releases, and says the framework was set up in record time instead of waiting a year for Congress.

  “We don't have just a two page document. We have the most robust regulatory scheme in the world.”at 40:24

Oil & fuels

• Scott Kirby · United Airlines

  Jet fuel prices will stay high into 2027 because the cost increase is structural.

  Kirby says the high fuel prices are structural, since costs have risen across the board from the COVID lows. Six to ten US airlines will lose money this year, which creates stress and pressure on capacity. He says United is planning for higher jet fuel and higher industry capacity next year. He is not sure when the weaker carriers will need to cut routes, but he expects the stress to continue. The Spirit exit this year gave only a temporary reprieve.

  “I think we'll stay high into 2027.”at 50:54