While we were all busy doom-scrolling articles about AI becoming sentient and enslaving humanity, it turns out the more pressing issue is… AI being too nice?

OpenAI just rolled back an update to its GPT-4o model because—get this—it was being overly supportive and fake. Apparently, we’ve trained our artificial overlords to be LinkedIn influencers: relentlessly positive, weirdly complimentary, and completely divorced from reality. Personally, I’ll take a little insincere flattery over a HAL 9000 meltdown, but sure—let’s fine-tune the chatbots to be more brutally honest while we’re at it.

Meanwhile, in the real (or at least publicly traded) world, markets staged a performance worthy of a Marvel finale. After a rough start triggered by bleak economic data and growing anxiety over AI hype fatigue, the S&P 500 and Nasdaq 100 clawed their way back from losses north of 2% to finish the day in the green. The Russell 2000 didn’t quite keep up, but hey—small caps need love too.

Big Tech: Still Printing Money Like It’s 2021

Meta and Microsoft both reported earnings yesterday and reminded everyone that while AI may be expensive, advertising and software subscriptions still pay the bills.

• Microsoft hauled in $70.1 billion, mostly thanks to Azure ($26.8B) and its Office-LinkedIn-Dynamics trifecta ($29.9B).

• Meta wasn’t far behind, with $42.3 billion in revenue and a blowout EPS of $6.43 (consensus was $5.23). That’s a lot of juice from one Menlo Park engine.

Even Bing—yes, Bing—is still generating revenue. If you told me a decade ago that Bing would outlive BuzzFeed News, I’d have asked what you were smoking.

But here’s where it gets really interesting. These two are no longer content just selling ads and licenses—they’re betting billions on becoming the infrastructure layer for the AI arms race.

• Meta’s CapEx budget ballooned again, now landing somewhere between $64 and $72 billion.

• Microsoft’s CapEx was up 52% year over year, hitting $16.7 billion for the quarter. That’s not cloud fluff—that’s cloud gold.

This isn’t just reinvestment. It’s an arms race. And while the jury’s still out on whether we’ll all be talking to AI therapists or AI landlords in five years, one thing is clear: Nvidia shareholders are popping champagne. Again.

The Market’s Mood Swing: April Edition

Oh, and about that GDP miss: Q1 showed a 0.3% contraction, which didn’t help anyone’s mood. Some traders saw it as a sign to hit the “Sell in May and go away” button a day early. But here’s the twist—per data pulled by David Crowther at Chartr, the seasonal selloff might actually have a statistical basis. Maybe the market really does want to take the summer off and come back when the Hamptons close.

The Real Takeaway?

AI is expensive. Data centers are the new trophy assets. And the frontier of tech isn’t soft and dreamy—it’s razor-edged and capital-intensive.

As investors, we’re watching the biggest players in the world dig deeper into AI, not just to stay relevant but to own the infrastructure of whatever comes next. Whether you’re betting on cloud margins, GPU makers, or the platforms turning compute power into consumer experiences, the message is the same: the future isn’t just digital—it’s powered by very real, very costly hardware.

And that’s some of the most expensive real estate in the world right now.

Thanks for reading. If you’re enjoying the ride through tech, capital, and the occasional AI personality crisis, subscribe and follow along. We’re just getting started.

– Daniel Kaufman