Quality matters in the neocloud space. I think lumping them all together is a mistake. Neoclouds can still get loans but it’s getting harder and how much they pay comes from how risky they look. Lenders care a lot about how strong customers are and how long those customers are signed up for since that’s the money that is paying back the loan. How new the company is and how much debt it already has are obviously key as well. Musk is arguing lenders have mostly stopped lending to companies that don’t bring in a lot of revenue outside AI data centers and he uses $SPCX as the example. They have Starlink and launch revenue and last week it cost about 2.3% a year to insure their debt against default. $CRWV makes almost all their money from AI data centers and it cost about 11% a year to insure their debt. But it doesn’t look like you need outside revenue to borrow yet. $NBIS makes almost all their money from AI cloud. They have customers like Microsoft and Meta and on Oct 17 during this selloff they got a one year $3.5B loan from Citi starting at about 6.7%. Compare this with Volta which is a new company and got a loan at about 10.5% two days earlier. They had to pay more than first planned to get it sold.

I think Trump’s deal with Russia is about getting Ukraine to stop hitting Russian refineries. Trump keeps pushing for it since Ukraine hitting those refineries is a big part of what’s holding back Russian fuel. If Ukraine stopped Russia could fix them and export more but bigger repairs take months. I don’t think Russia is offering unlimited diesel. Their deputy prime minister said buyers can have as much as they want from what Russia will export. And so far this month Russia is exporting about the same amount as last month. Not sure this does much for diesel prices. The deal is also a big change in US policy. The US is letting Russian diesel in even though Congress banned it. I have seen senators from both parties say this breaks that law so we have to see how this develops.