Dear Reader,

In 1929, Wall Street was throwing the biggest party in history.

The Dow Jones was setting new records every month. People were literally jumping over each other to invest in any stock they could. Even shoeshine boys were handing out stock tips.

But a young, 20-something stockbroker named Irving Weiss noticed something even veteran brokers didn’t.

Irving noticed that the numbers behind America’s largest companies painted a completely different picture. He saw a massive, systemic crisis forming beneath the surface of the "Roaring Twenties."

So he did something completely unthinkable. He borrowed $500 from his friends and family and shorted the entire stock market.

A few months later, Black Monday hit. The average stock lost 90% of its value. But Irving Weiss made a fortune.

Then in the 1970s, his son Martin took over the reins of the firm. He took the formulas his father used to predict the 1929 crash, and digitized them into a proprietary ratings system.

Today, that system is known as Weiss Ratings. This system performs tracks 22,000 publicly traded stocks and performs 1.2 billion daily calculations.

It’s the exact same system that called the bank failures of the 1980s, the Dot-Com bust, the 2008 financial crisis, and the 2020 crash.

And right now, for the first time in years … that same system is flashing "Code Red."

Because just like in 1929, Wall Street is ignoring the $38 trillion national debt. They’re ignoring the oil surge and inflation shock set to be triggered by the conflict in the Middle East.

But our ratings don’t ignore or overlook stuff.

In fact, our system just issued an urgent "Must-Sell" warning on 10 extremely popular, widely-held US stocks.

Our system indicates that when this debt crisis hits the market, these 10 stocks will be the first to collapse.

At the same time, it just upgraded 3 under-the-radar companies to an urgent "Buy."

I’ve recorded a special market briefing detailing exactly how this 100-year-old system works, and what it’s telling us to do with our money today.

Click here to watch the briefing and get the names of the 3 "Buy" stocks absolutely free

Chris Graebe
Weiss Ratings

Oracle Is One Step From Junk—Can It Afford the AI Boom?

Written by Sam Quirke. First Published: 7/21/2026.

The past few weeks have seen the bond market start asking a question the stock market has mostly been happy to ignore: Who can actually afford the AI buildout?

On July 9, S&P Global Ratings gave its answer for one of the biggest spenders. It cut Oracle Corp.'s (NYSE: ORCL) long-term credit rating to BBB-, the lowest rung of investment grade and just one notch above junk.

The stock has since fallen to around $125, down nearly 30% over the past month and nearly 50% over the past year.

What makes the downgrade worth more than a passing glance is what it reveals about the broader group. Every major AI spender is pouring money into expanding its supply capabilities, but they're doing so from very different financial positions, and the gap between them is widening quickly.

The Downgrade Isn't Really About Oracle's Business

S&P's reasoning for the Oracle downgrade was blunt.

The agency admitted it had underestimated the scale of investment required for Oracle's AI ambitions, and it now expects the company's free operating cash flow deficit to widen to roughly $42 billion in fiscal 2027, nearly double its earlier forecast.

The other red flag was customer concentration. S&P estimates that around half of Oracle's $638 billion in remaining performance obligations is tied to OpenAI alone, and it described that single relationship as a key credit risk.

The concern is understandable—Oracle has taken on long-term commitments for facilities and equipment to serve OpenAI's demand, so even if payments were to slow, Oracle's obligations would still need to be met in full.

Where Each Spender Actually Sits

So what does that mean for Oracle's peers? Put the four biggest AI spenders side by side, and the divide becomes obvious.

The top two are Microsoft Corp. (NASDAQ: MSFT), which carries an AAA rating, and Alphabet Inc. (NASDAQ: GOOGL), which carries an AA+ rating. Next up is Amazon.com Inc. (NASDAQ: AMZN), still at the higher end of the scale at AA, while Oracle sits alone at BBB-.

The uncomfortable answer to the question, though, is that none of them can fully fund this from existing cash generation anymore. All four have seen free cash flow compressed dramatically by the scale of the spending, and all four have tapped the bond market to help close the gap. What separates them isn't whether they borrow, but how heavily they're leaning on debt, and how much of the repayment depends on revenue that hasn't arrived yet.

The Headroom Gap

Microsoft and Alphabet started this cycle with the strongest balance sheets and the most cushion, which is why they still sit near the top of the ratings scale despite spending heavily. Amazon is only just holding on to positive free cash flow, but its accelerating AWS growth is giving investors a reason to stay cautiously bullish on the spending for now.

Oracle is the only one, so far, that appears to have run out of room, and its move into negative free cash flow is a bright red flag. The leverage numbers underscore the point: Oracle sits several times above Amazon on debt-to-equity and nearly 20 times above Alphabet, which is actually running a net cash position.

More importantly, it has no rating cushion left, whereas its peers have several notches to go before their own credit standing comes under real pressure.

Why the Funding Gap Matters

This distinction shows up in three ways that directly affect shareholders. The first is higher interest expense. Oracle's elevated risk profile means that every additional dollar of debt costs more than it would for its better-rated peers, which will weigh on profitability.

The second is a lower likelihood of buybacks. Companies generating strong free cash flow, like Alphabet, can keep buying back shares while continuing to invest in growth, whereas negative free cash flow will make it far more difficult for Oracle to do the same.

The third is what happens if demand for AI cools. A company funding most of its capital expenditure from operations can simply spend less and wait. A company funding itself predominantly with debt still owes the money it has borrowed, regardless of whether the expected revenue arrives, and its valuation becomes much harder to defend when investors start to doubt it will.

So Who Can Actually Afford It?

Line the four up against the question, and a clear order emerges. Microsoft and Alphabet are best positioned to fund this from what the business itself generates, with the strongest balance sheets, the lowest leverage, and, in Alphabet's case, more cash than debt.

Amazon sits in the middle. It's spending more than anyone, and its cash generation is stretched thin as a result. Still, the accelerating growth at AWS suggests the money is meeting existing demand rather than demand it's hoping to create.

Oracle is the outlier on both sides of the question. It's leaning hardest on borrowing and on revenue that hasn't arrived yet, with a backlog that has to convert and a single customer accounting for around half of it. That combination is why it's the only one of the four with no rating cushion left.