This week’s world-famous news haiku competition™ is about how Americans are falling behind on our credit card bills. Send me your entry — to haiku at cheddar dot com — by noon ET Thursday (today!), for consideration by your Cheddar peers.

Matt Davis — Need2Know Chedditor

News You Need2Know

What’s the stock market up to, eh?

$SPX ( ▼ 0.74% )   $DJI ( ▼ 1.21% )   $NDX ( ▲ 1.59% )  

Companies mentioned in today’s newsletter

$VOO ( ▼ 0.7% )   $SPCX ( ▼ 0.18% )   $ANTHROPIC ( ▲ 6.3% )   $GOOGL ( ▼ 0.79% )   $PANW ( ▼ 5.64% )   $M ( ▲ 0.6% )   $MRVL ( ▲ 3.74% )   $NVDA ( ▼ 3.62% )   $MDT ( ▲ 5.7% )   $GME ( ▲ 6.02% ) $MU ( ▲ 1.45% )  

Vanguard's S&P tracker nets $1 trillion

Congratulations to Vanguard for hoarding a literal trillion dollars in their S&P 500 Exchange Traded Fund $VOO ( ▼ 0.7% ) . If there's anything the global economy desperately needed, it was a single passive fund dwarfing the GDP of most sovereign nations.

Having miraculously quadrupled in size since 2022, this behemoth proves once and for all that doing absolutely nothing — also known as "passive investing" — is officially better than whatever highly paid Wall Street active managers have been attempting for decades.

Let's hear from the experts. Todd Rosenbluth, head of research at TMX VettaFi, told the Financial Times, “As investors chase the AI boom, ETFs have become an ultimate vehicle for U.S. equity exposure.” Why bother doing actual research to pick a winning tech stock when you can just blindly buy a microscopic slice of all of them? He adds, “Vanguard’s VOO has been the massive winner here, simply because it’s the biggest and among the cheapest ways to ride that trend.”

With a laughably-small fee of just 0.03%, we're witnessing a “pretty much one-way flow out of active into passive” funds, Rosenbluth adds. Now, this trillion-dollar monster is just sitting there, waiting to indiscriminately devour upcoming mega-IPOs like SpaceX $SPACEX ( ▲ 1.64% ) and Anthropic $ANTHROPIC ( ▲ 6.3% ) . Who needs critical analysis or price discovery when a mindless tracker can just buy the index? Hey, it’s almost like these Wall Street fund managers were just in it to skim off the fees all along…

Quote of the Day

Google borrows to overcome power bottlenecks

The AI boom requires the frantic construction of massive data centers, but the industry is facing severe bottlenecks, particularly the availability of electric power. To ensure its infrastructure isn't held back, Google's parent company, Alphabet $GOOGL ( ▼ 0.79% ) , is raising a staggering $80 billion in equity to get the job done quicker.

Unlike its competitors, Google has adopted a novel strategy to secure its own power generation. This year, Google acquired Intersect, a wind and solar developer, for $4.75 billion, making it the only tech giant to actually own a power company. This grants Google direct access to multiple gigawatts of developing energy projects to feed its power-hungry servers.

Beyond building new power sources, Google is pioneering "demand response" tactics to manage electricity constraints. The company is actively investing in the ability to shift its computing loads to match power supply availability. Google also recently partnered with Voltus in a three-year agreement to create up to 100 megawatts of capacity in the nation’s largest power market. By paying local homes and businesses to reduce their power consumption during peak times, Google is actively freeing up the electricity it needs to operate.

Investors hate that Google has had to borrow so much to fund its AI ambitions. Shares in Google have lost $340 billion in market value over just three trading sessions, the company’s largest ever 3-day loss.

Trump’s AI order is a blow against laissez-faire

Despite a reputation for slashing red tape and focusing on beating China in the tech race, the Trump administration’s newly signed AI executive order signals a massive shift toward tighter government oversight. For supporters of a laissez-faire tech "Wild West," there’s a new sheriff in town.

The core of the order is a 30-day voluntary vetting process where top AI firms agree to share advanced models with the government to evaluate cybersecurity risks. While officially voluntary, pro-regulation advocates are celebrating this as a major victory that could pave the way for mandatory federal pre-approval. Steve Bannon, a conservative advocate for AI regulations, told Politico, “For the first time it’s on a piece of paper, a structure and a process... we’re going to eat the elephant one bite at a time.”

Unsurprisingly, the AI industry views the new framework with deep trepidation. Caleb Max, CEO of the National Artificial Intelligence Association, told Politico, “Rarely does the government do things that are only voluntary... These things typically only get tighter, not looser.” While currently framed as a collaborative effort, this executive order firmly opens the door for more AI regulations in the future.

It’s good news for most U.S. voters, however, with the vast majority of both parties telling a YouGov poll the technology is moving too fast. What do you think? Tell us in today’s poll