The SpaceX IPO is set for June 12th, with an anticipated market cap after day one between $1.5 and $2.5 trillion. Most of that valuation is based on the prospect of dominating the market for satellites, putting data centers in space, and the endless demand for computing power from AI. It is essentially an AI-related market power play.
I have no speculative insight into the value of SpaceX stock as an investment, but I am an inveterate, unrepentant consumer of irony. An IPO is a speculative investment, but it’s also the act of becoming a publicly held company. A large part of being a public company is getting the accounting right. Modern accounting has all kinds of informational value, but from the point of view of large companies it’s mostly about minimimizing taxes while maximizing perceived value. Both of those ambitions include strong incentives for malfeasance, which is why we have audits, financial regulation, and the IRS. The IRS and financial regulation have been defanged, however, mostly due to a lack of personnel from aggressive destaffing, at least some of which you can lay at the feet of DOGE. You can’t audit a massive company effectively without accountants.
Or can you?
I can’t think of a technical task that is more perfectly suited to AI than auditing a public companies accounts and SEC filings. You feed AI a billion previous filings, all of the associated laws and regulations, and then flag all the records previously found in violation. Then you feed it new ones and say “show me the violations and discrepancies in rank order of dollar value.” A hundred good accountants using a dedicated AI, that’s exactly the kind of story that leads to the order of magnitude increase in labor output that the biggest proponents of AI are looking for.
Never forget that the event that initially popped the dotcom bubble was Microstrategy getting caught cooking the books.
I know you can’t write history like a novel, but “IRS, previously destaffed by Musk-headed DOGE, is forced to use AI enabled audits and finds massive revenue discrepancies, leading to panicked sell-off of Musk-headed IPO record holding company and kicking off AI stock sell-off”…that’s too easy, right?
Economist Writing Every Day 