Nvidia is in talks to guarantee roughly $250 billion in financing for OpenAI's lease of a 10-gigawatt data center campus in Piketon, Ohio, the Wall Street Journal reported. Jim Cramer stated on Mad Money that the US government acts as a "subtle backstop" behind the chipmaker to prevent China from winning the artificial intelligence race. Commerce Secretary Howard Lutnick controls power access to the decommissioned federal site where the project is planned, with the full development including chips potentially exceeding $500 billion.
Nvidia Negotiates $250 Billion Guarantee for OpenAI Data Center in Ohio
Nvidia is in talks to guarantee roughly $250 billion in financing for OpenAI's lease, the Wall Street Journal reported. The deal covers a 10-gigawatt data center campus in Piketon, Ohio. The site sits on decommissioned federal land. The full project, including chips, could exceed $500 billion.
Electricity for the campus flows from a natural gas plant that Japan is funding with a $33 billion investment. That investment is part of a recent US trade deal.
Howard Lutnick Controls Power Access to Piketon Federal Site
Commerce Secretary Howard Lutnick decides which company gets access to power at the Piketon site. OpenAI, Anthropic, Microsoft, and Google have all approached him about the site.
Jim Cramer Calls US Government Nvidia's Subtle Backstop
On Monday night's episode of "Mad Money," Cramer linked Nvidia's financial strength to Washington's stake in the outcome. "They have the best balance sheet of any company in the world," Cramer said. He added that the government is a "subtle backstop" so China does not win the AI race.
Nvidia's cash and a government hand on the power switch make a powerful combination. Cramer calls Nvidia a stock to own even as shares slide.
Michael Burry Criticizes Nvidia Financing as Circular Arrangement
Investor Michael Burry has called the arrangement circular. He argues Nvidia's guarantees would fund OpenAI's purchases of Nvidia's own chips. Nvidia is discussing that separate chip financing package, which could reach $350 billion. OpenAI lacks its own investment-grade credit rating, a gap that already caused other financing troubles this year.
FAQ
What is Nvidia negotiating with OpenAI?
Nvidia is in talks to guarantee roughly $250 billion in financing for OpenAI's lease of a 10-gigawatt data center campus in Piketon, Ohio, the Wall Street Journal reported. The full project, including chips, could exceed $500 billion.
Why does Jim Cramer say the US government backs Nvidia?
On Monday night's episode of "Mad Money," Cramer said the government is a "subtle backstop" so China does not win the AI race. He stated that Nvidia has "the best balance sheet of any company in the world" and linked the chipmaker's financial strength to Washington's stake in the outcome.
Who controls power access to the Piketon data center site?
Commerce Secretary Howard Lutnick decides which company gets access to power at the decommissioned federal site in Piketon, Ohio. OpenAI, Anthropic, Microsoft, and Google have all approached him about the site.
