Low-rated AI borrowers face tougher terms as investors grow choosier. James Altucher points to one company tied to Elon Musk that already owns something the AI buildout can’t do without. <\/p>\n
Washington, D.C., Oct. 19, 2026 (GLOBE NEWSWIRE)<\/a> — The AI boom has a new fuel: junk debt. Low-rated companies have issued $88 billion of AI-related debt this year, according to Goldman Sachs. In the first 11 months of 2025, the number was about $20 billion, per Neuberger Berman. <\/p>\n Now lenders are getting picky. Unproven AI borrowers face higher rates and tougher terms. Investors want companies with real assets and steady contracts. <\/p>\n That shift says something about where AI is heading. It isn’t just a software story anymore. It’s an expensive physical buildout. In a new free presentation<\/a>, tech expert James Altucher points to one small company he says already owns a piece of that buildout Elon Musk can’t skip. <\/p>\n The Party Is Getting Picky <\/p>\n Not every AI borrower is getting the same deal. <\/p>\n Lenders are demanding more from companies that haven’t proven they can pay. Even big names are paying up. SoftBank Group, which is rated just below investment grade, recently paid as much as 9.75% to borrow. <\/p>\n Meanwhile, the money is flowing to the hard stuff. AI infrastructure debt from lower-rated borrowers has hit $40 billion this year, according to BNP Paribas, up from $12 billion in all of 2025. Data centers are doing much of that borrowing. <\/p>\n Lenders don’t want to bet on promises. They want to bet on things they can touch. <\/p>\n AI Is Expensive. Really Expensive. <\/p>\n The biggest AI plans burn cash long before they earn a dime. Chips. Data centers. Power. Networking. Land. Sometimes a whole power plant. <\/p>\n All of it has to be paid for up front. <\/p>\n That’s what makes the debt story so telling. A flashy new chatbot launch hides the real cost of AI. A pile of junk bonds drags it into the open. <\/p>\n And it’s a reminder to look past the companies hogging the spotlight. “When Elon transforms a market he lifts everything around it,” <\/a>Altucher says. <\/p>\n Why Musk Looks Different <\/p>\n Musk isn’t renting the pieces he needs from someone else. He’s building them himself. Rockets. Launch sites. Satellites. The AI itself. A planned chip factory. <\/p>\n “Every vertical in the AI industry, he now controls,” <\/a>Altucher says. <\/p>\n Altucher points to a SpaceX filing with the FCC that he says shows how far Musk plans to take it, with a million AI data center satellites running in orbit. <\/p>\n And by Altucher’s count, Musk is just getting started. “They have only accomplished 1% of what Elon has set out to do,” he says. <\/p>\n From Junk Debt to the Overlooked Supplier <\/p>\n When money is cheap and everyone’s excited, almost any AI pitch can raise cash. When lenders tighten up, the question gets sharper. What does the AI buildout truly need? And who owns it? <\/p>\n Altucher believes he’s found one answer. He points to a small supplier that he says helped create the “nervous system” for Musk’s satellites. He says the two have “a jointly created, patent protected system that is being used in Elon’s satellites.”<\/a> <\/p>\n And it’s not a new relationship. “This isn’t some company hoping Elon calls one day,” Altucher says. “They already have him. And have for over a decade.” <\/p>\n AI takes a massive physical machine to build. And the best opportunities may be far from the famous names. <\/p>\n About This Presentation <\/p>\n AI is running out of power. James Altucher believes Elon Musk has a plan to fix that, and it starts in orbit. His free on-demand presentation explains the energy problem facing AI, the SpaceX filing behind Musk’s answer and the overlooked company Altucher believes could benefit as it unfolds. Watch it here<\/a>. <\/p>\n About James Altucher <\/p>\n James Altucher is a Wall Street veteran who has spent more than 30 years working where technology and money meet. He has managed hedge funds, designed his own AI-driven trading algorithms and raised capital for venture investments. He’s been featured on CNBC, Fox Business and in The Wall Street Journal. He also hosts The James Altucher Show podcast, where he has interviewed some of the biggest names in finance and business. <\/p>\n","protected":false},"excerpt":{"rendered":"Low-rated AI borrowers face tougher terms as investors grow choosier. 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