Key Points:
Google raised $100 billion in four months — $80B in stock Sunday, $20B in bonds in February, one bond due in 2126.
2026 AI spending hits $180 billion — double this year, six times four years ago.
Buffett got a fixed price ($351.81). Regular shareholders watched the stock drop 4%.
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I almost spit out my coffee Monday morning.
The press release hit the wires at six a.m. Eastern. Google had sold eighty billion dollars in new stock the night before. Eighty billion. With a B. The biggest cash machine in the world was asking the public for cash.
Here's what worries me. Google made over four hundred billion dollars in sales last year. They print a hundred billion in revenue every three months. That's not a typo. Three months. They have more cash on hand than most countries. And yet on Sunday night, they sold new shares to the public. To pay for AI.
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This isn't the first time this year, either. Back in February, Google sold twenty billion in bonds. One of those bonds doesn't get paid back until the year 2126. A hundred years from now. That's almost unheard of. Most companies sell ten-year bonds. Thirty years at the outside. A hundred-year bond is a Hail Mary. My grandkids will be old when that loan comes due. Maybe their kids will be old.
Add it up. In four months, the cash machine has raised a hundred billion dollars from outside. From people like us. From pension funds. From mom-and-pop investors. To pay for chips and giant data centers the size of small towns.
The plan for next year is bigger. One hundred and eighty billion dollars in AI spending. Double what they spent this year. Six times what they spent four years ago. Six times. I had to read that twice too.
I get it. AI is real. The data centers are real. Someone has to build them. They cost a fortune. The chips alone cost a fortune. But I don't think most people realize what's happening to their savings while this goes on.
If you own an S&P 500 fund, you own Google. It's one of the biggest names in the index. So is your 401(k). So is your kid's college fund. So is the pension fund that pays your uncle. When Google sells new shares, your slice of the pie gets smaller. They call it dilution. I call it a haircut you didn't agree to.
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And here's the part I can't stop thinking about. Warren Buffett showed up.
His company sat on nearly four hundred billion in cash for two years. Refused to touch a tech stock. He said prices were too high. He earned a safe five percent on Treasury bills. He told his shareholders to be patient. He sounded like the only sane man in the room.
Then on Monday, he wrote a check for ten billion dollars. He bought Google shares at a fixed price. Class A for $351.81. Class C for $348.20. Locked in. No surprises.
The press called it a vote of confidence. A blessing from the Oracle of Omaha.
You and I didn't get that deal. We watched the stock drop about four percent the same day. Buffett got his price locked in. We got whatever the open market handed us.
This is how it always works. The big money gets the side deal. The small money gets the press release. Same trade, two prices. One for the club. One for the rest of us.
Here's the number I'd tell my buddy at the golf course. Six times. Google is spending six times more on AI than they did four years ago. And they had to borrow a hundred billion dollars from us to do it.
Nobody knows if any of this AI spending will pay off. Not me. Not Google. Not Buffett. They're all betting on a future no one can see. And they're betting with our retirement money.
If Google needs cash this badly, the rest of them need it too. Meta is spending like crazy. Microsoft is spending like crazy. Amazon is spending like crazy. The bills are getting bigger. The cash isn't keeping up. More stock sales are coming. More bonds. More dilution. More haircuts.
I don't say this to scare you. I say it because we need to be awake. The next time you hear Big Tech is "investing in the future," remember who's paying for it. Look at your statement. Then look in the mirror.
The smart money got their price on Monday. The rest of us got a haircut and a press release.
More on this tomorrow.
— Lauren
Editor, American Ledger
