Bloomberg Businessweek Weekend - August 7th, 2026

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This is Bloomberg Businessweek Daily, reporting from the magazine that helps global leaders stay ahead, with insight on the people, companies, and trends shaping today's complex economy. Plus, global business, finance, and tech news as it happens. The Bloomberg Businessweek Daily podcast with Carol Massar and Tim Stenovec on Bloomberg Radio.
Hi, everyone.

**Carol Massar** (0:32)
Welcome to the Bloomberg Businessweek Weekend Podcast. A big focus for everyone this week. I got to be honest, since the IPO back in June, this has been a countdown. We are talking about SpaceX and its earnings. Investors got their first look at SpaceX's financials. Following its landmark IPO for all the details on the results, head to the Bloomberg end at bloomberg.com. But Tim, like you kept saying, it wasn't really about earnings because the company isn't profitable overall.

**Tim Stenovec** (0:59)
Yeah, my dad always reminds me, earnings mean you have earnings, and SpaceX didn't have any earnings. Bottom line for investors, top line revenue surged. Staggering CapEx sent the stock tumbling in the release. That theme of the eye-watering AI spend, it's something we dig into this hour with a noted critic of the AI build and spend.

**Carol Massar** (1:19)
That tech critic, he's also the publisher of Where's Your Ed At? We're talking about Ed Zitron. He stopped by to dissect the hundreds of billions of dollars going into the AI CapEx movement and spend overall and why the massive gap between data center spending and actual AI revenue is creating what Ed calls, quote, an unsustainable circular economy. He's not alone in that thinking.

**Tim Stenovec** (1:43)
No, he's definitely not. I think what he says really resonates with an audience, and we see that when he comes on the program. AI has talked a lot about by us here at Bloomberg. You know that at this point. So too increasingly our prediction markets and the battles they are dealing with when it comes to their role in the financial world and the growing legal challenges that are questioning them.

**Carol Massar** (2:04)
That's right. We wanted to hear how Kalshi is keeping up with all the lawsuits filed against them. We do that with Bobby DeNault, head of enforcement and legal counsel at Kalshi. Needless to say, there's a lot at stake.

**Tim Stenovec** (2:17)
Speaking of high stakes and back to AI, Aaron Brown, Bloomberg Opinion Columnist and former Chief Risk Manager at AQR Capital Management, that's Cliff Asness's fund, weighs in on the AI hedge fund situational awareness and why a staggering 439% first half return was a glaring warning sign about market mania.

**Carol Massar** (2:36)
All of that to come this hour, we begin with legal battles surrounding prediction markets. The recent surge in volume across platforms like Kalshi and Polymarket has made event-based trading of the fastest growing corners of finance.

**Tim Stenovec** (2:51)
Yes, but also growing regulatory scrutiny of these markets. Just last week, New York state authorities sued Kalshi for allegedly running an illegal unlicensed gambling operation in the state, marking another legal hurdle for an industry that has won support from the Trump administration.

**Carol Massar** (3:06)
We needed to learn more. And so for that, we caught up with Robert DeNault, head of enforcement and legal counsel at Kalshi.

**Robert DeNault** (3:13)
I mean, as both a New Yorker and a lawyer, I'm alarmed by the overreaching sentiment that's coming from the attorney general's office. So Kalshi is a licensed federally regulated exchange.
By her logic, any federally regulated exchange that's operating with a federal license and overseen by a federal regulator can suddenly be subject to the whims of state criminal enforcement if the attorney general of a particular state wakes up and decides one day that these contracts actually come within New York state gambling law. That's not how any exchange in US history has ever operated, right? So we have, we're here at Bloomberg, you guys talk about the New York Stock Exchange, NASDAQ, other exchanges. All of them could be potentially affected by the breadth and scope of the New York Attorney General's approach and legal theory in terms of how she believes she can regulate and bring to heel federally licensed exchanges here in New York State.

**Carol Massar** (4:08)
Bobby, are you saying you're the exact same things as the New York Stock Exchange and the NASDAQ Markets that you're saying you're the exact same thing apples to apples then?

**Robert DeNault** (4:16)
What I am saying is that federal law dictates that that is the case. When a federal law like the Commodity Exchange Act exists and provides for a way for an entity to get licensed by something like the Commodity Futures Trading Commission or the Securities Exchange Commission, that licensure and that federal regulation is what governs that marketplace. Now, if states want to litigate with that regulator on a case by case basis about what types of contracts might implicate some state laws, that's one question and that's some of the lawsuits we've seen over the last year on sports. But this is much more far reaching. This is claiming that that license means nothing. And if you don't hold a New York license, you're running a criminal operation and you need to be run out of the state. And I think it's important to ground this sort of in history of disruptive sort of new players in marketplaces, right? Call she's new, but this sort of license regime has existed for many decades. We've seen similar playbooks used against companies like Uber and Airbnb where states try to throw their weight around and bring crazy cases to block what customers want as a reasonable alternative. We think that that's a pretty similar playbook to what the attorney general is following here.