The Daily Spark

Major copper discoveries, meaning deposits with at least 500,000 tonnes of contained copper, have fallen from double digits annually in the 1990s and 2000s to one or two in recent years, with none in 2025. Because a new deposit takes roughly 18 years to reach production, the chart below describes supply in the 2040s.

Meanwhile, the AI data center buildout is adding copper-intensive load on a two- to three-year cycle, pointing to a structurally tighter market and upward pressure on prices.

The income that lifted America's top 1% did not come mainly from tech or Wall Street, according to The Everywhere Millionaire. More than half of the rise in the top 1% income share since 1985, 5.8 of 10.5 percentage points, flowed through pass-through businesses, see chart below.

The authors, Owen Zidar and Eric Zwick, counted roughly 3 million wealthy private business owners, with average net worth near $25 million, running law firms, car dealerships, medical practices, commercial contractors and regional restaurant chains, the kind of businesses that make their owners wealthy and well known in their own communities without ever making them nationally famous.

Fed Chair Kevin Warsh has been remarkably consistent. He has repeatedly said the Fed will deliver price stability. Wednesday’s rate hike shows that he means it.

There is another important parallel with former Fed Chair Paul Volcker: no forward guidance. Volcker did not tell markets what the Fed would do at the next meeting. Warsh takes the same approach.

The bottom line is that Warsh is following the number one principle for successful central bankers: say what you do, and do what you say.

Securitization of US data center debt has totaled $81.4 billion since 2018, of which $18 billion was in 1H 2026 alone, see the first chart below. The EU has seen just $1.7 billion, of which $0.9 billion was in 1H 2026. The UK is little better, with $2.3 billion since 2018, of which $1.1 billion was in the first half of the year.

The gap extends beyond just data centers to other strategic assets. US solar securitizations have raised $29.3 billion since 2018, compared with just $1.1 billion in the EU, see the second chart below.

Part of the problem has been overly burdensome securitization rules compounded by insurance regulations that have discouraged European life insurers. EU life insurers hold just 0.33% of their investment assets in securitizations, compared with roughly 17% for US life insurers, despite the two industries being similar in size. The EU has proposed tweaks to its securitization rules, but the changes are modest relative to the scale of the financing challenge.

If Europe wants to narrow the AI investment gap with the US, it will be harder if one of the markets helping finance the US data center buildout remains largely closed in Europe.

Written by Huw van Steenis, London

The widening in hyperscaler CDS is not driven by dealer hedging of new issuance. If it were, bank CDS would be widening too, given that banks remain the single largest source of IG supply, and instead bank spreads have sat flat near 40 bps. What the market is repricing is hyperscaler credit fundamentals, namely a debt-financed AI capex cycle with rising leverage, negative free cash flow and uncertain payback on depreciating assets.

The chart below, from the new book The Everywhere Millionaire, shows that the 400 wealthiest Americans on the annual Forbes list hold about $4 trillion in combined wealth, while the far larger group of private business owners with at least $10 million in net worth holds $46.7 trillion.

Built from the Fed's Survey of Consumer Finances and backed by the authors' decade of work inside de-identified IRS records, the comparison suggests most top-end wealth in the US does not sit with a few household names but with millions of business owners in towns and mid-size cities across the country.

Canada is hosting its Investment Summit over the coming days.

A recent report projected Canada will need US$4.7 trillion in infrastructure investments by 2050, spanning roads, bridges, waterworks, hospitals, data centers and defense. Energy/natural resources are the #1 bucket at one third of this, or $1.6 trillion.

Canada's investment in machinery and equipment is still below where it was in 2007, 19 years on (inflation adjusted). Broader business investment has barely grown, underperforming even the euro area, while the US has expanded steadily, although business investment stirred in Q2, see charts below.

The bottom line is that reversing this requires a step change in business conditions and capital investment from both the public and private sectors. The Investment Summit, co-organized with CPP Investments and PSP Investments, is targeting $1 trillion of fresh investment over five years, particularly focused on energy projects and large-scale infrastructure. It will be a useful lens on how that ambition translates into projects and committed capital.

Written by Huw van Steenis, London

The cost of setting up an LLC ranges from $1,000 in Massachusetts and $890 in California to just $35 in Montana, see chart below.

Too much saving pushed rates down for two decades. The problem was that there was more capital than projects to invest in.

That has now changed. Today, there are more projects than capital.

Think about what that does to price. When capital is abundant and projects are scarce, projects compete for capital, and they compete by accepting a lower return. When projects are abundant and capital is scarce, capital competes for projects, and it competes by demanding a higher return. The return that clears the market is a higher yield.

Take the data center buildout as an example. It is not that the money isn't there. Hyperscalers have raised everything they have asked for. It is that they are paying more for it. Spreads on their longest-dated bonds have widened, and most of the paper issued in 2026 trades wider today than where it priced. Investors are still buying. They are just charging more.

Note where the repricing lands. Data centers, power generation, transmission and government deficits are all long-duration claims on savings. So the competition for capital concentrates at the long end of the curve, which is why long rates have moved more than short rates.

The bottom line is that we have been through a regime change. From a savings glut to a savings shortage, see chart below.

With this backdrop, it is not surprising interest rates are going up.

Data from the S&P 500 second quarter earnings season shows that AI adoption keeps broadening: 69% of companies now point to a live deployment, up from 64% last quarter, see the first chart below.

But the disclosure thins out fast.

Only 29% put a number on a result, 2% report a metric tracked over time, and none break AI value out as its own KPI or P&L line.

Where companies do quantify the impact of AI, the evidence skews heavily toward cost, which accounts for 70% of disclosed proof points versus 22% for revenue, see the second chart. Some of that is timing, since efficiency gains land inside existing operations well before new revenue lines take shape.

That still leaves investors without a verifiable link between AI capex and the top line.

The question is no longer who is deploying AI. It is who can prove the ROI.

For more data and discussion, see the AI Value Gap here.