🙅🏻♀️🧠 US Considering Blocking AI Chips to Certain Countries
🙅🏻♀️🧠 US Considering Blocking AI Chips to Certain Countries
Happy Wednesday all,
This week’s headlines are a real mixed bag—like daylight saving time, but at least you don’t have to adjust your clocks! Boeing is scrambling for cash with a $10 billion stock sale, while the US tries to loosen China’s grip on cobalt. Meanwhile, Tom Brady’s making plays off the field with a big investment in the Las Vegas Raiders, and Wall Street banks just scored a surprise trading win—no Hail Marys needed.
On the consumer front, inflation expectations are creeping up again, and more people (yes, even those with six-figure incomes) are getting worried about missing payments. Plus, the US is looking at new limits on AI chip exports, and chipmaker ASML had a rough quarter, missing big on bookings. Oh, and TD Bank is in hot water with a $3 billion penalty for money laundering lapses. Plenty to unpack—let’s dive in!
- Humphrey & Rickie
👀 Eye-Catching Headlines
Boeing to Sell at Least $10 Billion in Shares to Plug Cash Drain (WSJ)
How the U.S. Is Trying to Challenge China’s Cobalt Chokehold (WSJ)
Tom Brady and partner Tom Wagner to pay over $200 million for stake in Las Vegas Raiders (CNBC)
Wall Street Banks Notch Surprise Trading Haul on Stocks Bonanza (BBG)
Debate Over Daylight Saving Time Shows There’s No Perfect Time (BBG)
Why Taiwan’s Status Risks Igniting a US-China Clash (BBG)
Google Backs New Nuclear Plants to Power AI (WSJ)
The Weekly Brief
US consumers see higher long-run inflation, rising delinquency risk
According to a September report by the Federal Reserve Bank of New York, Americans say they expect higher inflation over the long run.
Americans’ expectations of credit delinquencies rose to the highest level since April 2020.
While inflation a year from now is expected to hold steady at 3%, three years from now it is seen to be 2.7% from August’s 2.5% estimate, and at 2.9% in five years, from 2.8% in the August survey.
The average expected probability of missing a debt payment over the next three months rose for a fourth straight month to 14.2%.
The largest increase was surprisingly among respondents with household incomes above $100,000.
US Weighs Capping Exports of AI Chips From Nvidia and AMD to Some Countries
The Biden administration is discussing capping sales of advanced AI chips from Nvidia and other companies on a country-specific basis in the interest of national security.
The White House has already restricted AI chip shipments by companies like Nvidia and AMD to more than 40 countries across the Middle East, Africa and Asia over fears their products could be sent to China.
ASML Shares Tank as Bookings Miss Amidst Chip Slowdown
ASML shares fell by the most in 26 years after it booked only half the orders Wall Street expected.
ASML makes advanced chipmaking machines. The Dutch company lowered its guidance for 2025 and reported bookings of €2.6 billion ($2.8 billion) in Q3, missing the analyst estimate of €5.39 billion.
Other chip-manufacturing equipment makers took collateral damage, with Applied Materials and Lam Research both suffering their worst declines since 2020.
TD Bank Agrees to $3 Billion in Penalties and Growth Caps
TD Bank pleaded guilty to criminal charges after it failed to properly monitor money laundering by drug cartels and other criminal groups.
As part of the agreement, a cap will be imposed on TD, preventing the bank’s retail business from growing above its current level of assets.
The bank’s head announced that it would reduce its $400bn+ US asset portfolio by 10% in order to continue lending money to clients.
According to US regulators, TD processed hundreds of millions of dollars that “clearly indicated highly suspicious activity”.
In one insane example, a Chinese criminal operation laundered $470mn of fentanyl sales and bribed bank employees.
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