Trump told CNBC that slowing AI down is off the table, but a former senator wants an executive order freezing AI company IPOs before another chip gets trained. The calls to pump the brakes and the pressure to floor it…
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Monday morning, hours after public radio spent its morning walking through an open letter asking the AI industry to slow itself down, President Trump told CNBC the opposite: “We’re leading China in AI. We’re the most sophisticated country in the world. And frankly, I want to keep it that way because whoever wins, AI wins.” Ninety minutes later, shares of Microsoft (NASDAQ:MSFT | MSFT Price Prediction) were changing hands at $498.70, and Polymarket bettors were pricing 84.5% odds that the stock would close green.
Slowdown Chorus Meets a Bid #
The safety chorus was unusually loud for a Monday. Anthropic chief executive Dario Amodei published a weekend essay urging peers to “slow the pace of AI research“, proposing common safety standards, cooperation with authoritarian governments, and third-party safety monitors positioned inside AI companies. Sam Altman called it a “great idea” and Elon Musk posted “Dario’s right.” On CNBC, Evercore founder Roger Altman called AI the greatest threat facing the world. Forty minutes later, former Senator Joe Manchin urged Trump to use an executive order to halt AI-company IPOs until safeguards are in place.
Microsoft’s own chief executive, Satya Nadella, split the difference in a way that tells you where the money sits. He warned that third-party safety officials could compromise customer data and trade secrets. Congress, meanwhile, offered the political equivalent of a shrug: House Minority Leader Hakeem Jeffries called for “decisive action” without a timetable, and Speaker Mike Johnson urged caution.
Why the Market Kept Buying #
The Microsoft numbers explain the shrug. Fiscal fourth-quarter revenue hit $90.01 billion, up 17.8%, with Azure growing 43% and crossing $100 billion in annual revenue for the first time. Commercial remaining performance obligations, the backlog that matters most for gauging AI demand, surged 84% to $678 billion. Microsoft 365 Copilot passed 30 million paid seats. Full-year capex ran $115.95 billion, up 79.6%, and free cash flow fell 6.5% as spending outpaced generation. That last number is the whole bull-bear debate in one line.
Now look at the old economy in the same session. Progressive (NYSE:PGR) posted $22.70 billion in Q2 revenue and grew policies in force 7% to 40.09 million, yet trades down 5.3% over the past year. Sherwin-Williams (NYSE:SHW) is pushing through an 8% price increase on September 1 to offset input inflation while its chief executive warns of “continued demand softness in the second half”. The stock is down 12.15% over the past year. J.M. Smucker (NYSE:SJM) beat estimates by 46% largely because of an 84-cent tariff-refund benefit, not organic strength. Housing starts sit at 1.24 million, down 12.4% month over month, and consumer sentiment reads 55.2, below the 60 recessionary threshold.
What to Watch Next #
The two-speed economy is now a two-speed policy debate. One side wants an IPO freeze and inspectors on the training floor. The other treats compute as strategic materiel against Beijing (the power, cooling, and networking suppliers behind that buildout are the subject of a free report we put together here: 7 Stocks Powering the AI Boom). With the federal funds rate stuck at 3.75% and MSFT flat at +0.36% over twelve months despite record bookings, the tell in the next quarter is policy action, not rhetoric. Watch whether the White House puts anything on paper about IPO conditions, and whether Microsoft’s FY27 capex guide, already pointed higher, forces free cash flow down a second consecutive year. Manchin wants a ; the backlog says the customers do not.
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