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Why Musk's xAI Memphis Moonshot Is…

Posted July 26, 2024

Matt Insley

By Matt Insley

Why Musk's xAI Memphis Moonshot Is…

Before we get to the meat of our issue today, I want to amend Wednesday’s. Because, reader, I left you hanging. 

The subject, if you recall, was copper — a topic we revisit from time to time. 

I tried to convince you that, right now, the red metal is the most important element on the periodic table. 

I closed with this jaw-dropping stat from Mining.com: 

Humanity would have to mine more copper in the next 20 years than we have in human history to meet surging global demand.

Yes… And? 

A colleague of mine tells me I should have enlightened readers — i.e. investors — about a stress-free way to get exposure to the copper market. 

The simplest way I know is Freeport-McMoran (FCX) stock. The Arizona-based company is the largest publicly-traded copper producer in the world. 

Plus, the company’s most recent earnings report was stellar. And FCX offers an annual dividend of $0.30 per share. 

With that amendment out of the way, onto the show… 

Send your opinions to, feedback@newsyoucanacton.com

Your Rundown for Friday, July 26, 2024...

Memphis Blues

Ever get the feeling it’s Elon’s world? And you’re just living in it? 

The more-or-less richest man on the planet can explore every personal enthusiasm. 

Cars. Rockets. Flamethrowers. (Like some 21st-century Peter Pan.)

Much like the rest of the world right now, Musk is obsessed with AI. 

  • In May, Musk closed a $6 billion fundraising round for a new company, xAI. 
  • On July 12, he announced the formation of xAI, now worth $24 billion, to “[work] on building artificial intelligence to accelerate human scientific discovery,” per the company’s website. 
  • To achieve that lofty goal, Musk’s “Memphis Supercluster” — “with 100k liquid-cooled [Nvidia] H100s” — allegedly went live at 4:20 am local time Monday.

“It’s the most powerful AI training cluster in the world!” Musk emphasized via his X platform. 

“Despite Musk’s posts, it's not clear how much of the cluster is online,” says trade publication Data Center Dynamics, because “the debugging and optimization process would take some time.” 

Plus, “the company has only 8 MW of power available from the power grid, while agreements xAI has brokered with utility companies such as Tennessee Valley Authority won’t be signed until next month, but could add 50 MW.”

All to say the multi-billionaire man-child is trolling us again: “Musk has long made jokes about the number” — 4:20 am — “a reference to weed.” 

Really, bro?

About as enthusiastic as Musk himself, Ted Townsend, president of the Greater Memphis Chamber, says the GPU supercluster is the “largest multi-billion dollar investment in the city of Memphis’s history.”

We love an underdog story as much as the next guy…

But Paradigm’s 5 Bullets managing editor Dave Gonigam doused cold water on the Memphis enterprise when he wondered at our editorial Slack channel: 

“Who thought it was a good idea to locate a ginormous data center so close to the New Madrid Fault?” 

I’d never even heard of the New Madrid Fault which was named for a massive earthquake and months-long aftershocks in New Madrid, Missouri circa 1811-1812. 

On a 2023 earthquake hazard map of the continental U.S. — from the U.S. Geological Survey — “the map [sports] a big bull’s eye in the middle of the country,” says an article at Undark Magazine. 

pub Source: USGS, Undark Magazine

“It’s really one of the most enigmatic seismic zones on the planet,” says University of Missouri seismologist Eric Sandoval. “We’re not supposed to have earthquakes here.” 

Nevertheless: “The USGS estimates that the region has a 25 to 40% chance of a magnitude 6.0 or higher earthquake in the next 50 years, and as much as a 10% chance of a repeat of the 1811-1812 sequence,” the article adds. 

In other words: An earthquake is just waiting to happen.

“Caught in this seismic splash zone are millions of people living across five states — mostly in Tennessee and Missouri, as well as Kentucky, Illinois, and Arkansas — including two major cities, Memphis and St. Louis.” 

Which seriously calls into question the location of Musk’s “Memphis Supercluster.” 

It sounds like a cluster, alright… Really, bro? 

Market Rundown for Friday, July 26, 2024

The S&P 500 is up 0.80% to 5,440. 

Oil is down 1% to $77.40 for a barrel of WTI. 

Gold is up almost 1% to $2,375.50 per ounce. 

And Bitcoin is up 4% to $67,370. 

Send your comments and questions to, feedback@newsyoucanacton.com

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