So the Fed cut rates by 0.25% this week, and everyone was like “cool story bro” because, honestly, we all saw that coming from a mile away. The market barely budged – up about half a percent across the board. Yawn.
But then Nvidia dropped a bombshell that made everyone forget about Jerome Powell’s predictable rate cuts: they’re throwing $5 billion at Intel. Yes, that Intel – the one everyone thought was basically the tech equivalent of a Nokia flip phone.
Plot Twist: Intel Is Back in the Game
Here’s where it gets spicy. Nvidia isn’t just writing Intel a charity check. They want Intel to build custom x86 CPUs that Nvidia will jam into their AI platforms. Translation: Intel just went from “has-been” to “AI wingman” faster than you can say “artificial intelligence.”
Intel’s stock shot up 22% after the news. That’s not a typo – twenty-two percent in one day. Remember when Intel was trading like a sad, forgotten relic? Well, someone just hit the resurrection button.
The Timing Is Everything
Here’s where things get interesting (and slightly conspiracy-theory-ish, but stick with me). About a month ago, the Trump administration bought a 10% stake in Intel for $8.9 billion at $20.47 per share. With Intel closing yesterday at $30.57, the government just made over $5.6 billion. Not bad for a month’s work.
And get this – Trump literally posted about it on Truth Social like he just won the lottery. Which, let’s be honest, he kind of did.
The AI Money Train Keeps Rolling
While everyone’s arguing about rate cuts and inflation, AI spending is absolutely bonkers right now. We’re talking 22% annual growth – that’s double the growth rate of regular old boring capital expenditures. AI now accounts for about 40% of all S&P 500 spending. That’s not a trend, that’s a tidal wave.
So when Nvidia – the undisputed king of AI chips – decides Intel is worth $5 billion, you better believe they see something the rest of us missed. Intel’s foundry operations are about to get very, very busy.
The Bottom Line
Sure, the Fed cutting rates is nice and all, but the real story is how AI is reshaping entire industries. Intel went from “meh” to “must-have” because Nvidia needs someone who can actually manufacture the chips they design at scale.
This isn’t just about two tech companies playing nice. It’s about positioning for the next phase of the AI revolution, where having the right manufacturing partnerships could mean the difference between riding the wave and getting crushed by it.
So while everyone else is obsessing over quarter-point rate moves, the smart money is watching where the AI giants are placing their bets. And right now, that bet is on Intel making a comeback nobody saw coming.