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Category: Economics/Business

CoreWeave’s staggering fall in value highlights AI bubble fears

CoreWeave’s staggering fall in value highlights AI bubble fears

The Wall Street Journal reports: CoreWeave, the largest of a new breed of companies driving the artificial-intelligence boom, has watched $33 billion of value vaporize in six weeks. The share-price plunge of 46% comes as investors worry about a possible AI bubble, the fallout from a failed merger and public criticism from high-profile short seller Jim Chanos, known for predicting the collapse of Enron. But some of the high-tech company’s biggest problems began with a very low-tech nuisance: unexpectedly turbulent…

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Wall Street sees AI bubble coming and is betting on what pops it

Wall Street sees AI bubble coming and is betting on what pops it

Bloomberg reports: It’s been three years since OpenAI set off euphoria over artificial intelligence with the release of ChatGPT. And while the money is still pouring in, so are the doubts about whether the good times can last. From a recent selloff in the shares of Nvidia Corp., to Oracle Corp.’s plunge after reporting mounting spending on AI, to souring sentiment around a network of companies exposed to OpenAI, signs of skepticism are increasing. Looking to 2026, the debate among…

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Oracle’s plunging stock shows the AI boom is running into two hard limits: physics and debt markets

Oracle’s plunging stock shows the AI boom is running into two hard limits: physics and debt markets

Fortune reports: Oracle’s rapid descent from market darling to market warning sign is revealing something deeper about the AI boom, experts say: no matter how euphoric investors became over the last two years, the industry can’t outrun the laws of physics—or the realities of debt financing. Shares of Oracle have plunged 45% from their September high and lost 14% this week after a messy earnings report revealed it spent $12 billion in quarterly capital expenditures, higher than the $8.25 billion…

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Trump’s dangerous designs on the Fed

Trump’s dangerous designs on the Fed

Catherine Rampell writes: There are many items on President Trump’s agenda that are hurting the U.S. economy: the pointless trade wars, the socialization of the private sector, the mass deportations, and much more. But in the long run, the most damaging policy of all might be one that’s gotten scant attention, at least from non-finance-nerds: Trump’s quest to crush the Federal Reserve. If Trump succeeds, he may doom the United States to high inflation for years, if not decades, to…

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Fed Chair Jerome Powell says U.S. may be drastically overstating jobs numbers

Fed Chair Jerome Powell says U.S. may be drastically overstating jobs numbers

The Wall Street Journal reports: Fed Chair Jerome Powell pointed on Wednesday to a job-market risk that economists have been worried about for months: Official statistics could be drastically overstating recent hiring. Powell said that Fed staffers believe that federal data could be overestimating job creation by up to 60,000 jobs a month. Given that figures published so far show that the economy has added about 40,000 jobs a month since April, the real number could be something more like…

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Something ominous — a reminder of the 2008 financial crisis — is happening in the AI economy

Something ominous — a reminder of the 2008 financial crisis — is happening in the AI economy

Rogé Karma writes: A company that most people have never heard of is among the year’s best-performing technology firms—and a symbol of the complex, interconnected, and potentially catastrophic ways in which AI companies do business these days. CoreWeave’s IPO in March was the largest of any tech start-up since 2021, and the company’s share price has subsequently more than doubled, outperforming even the “Magnificent Seven” tech stocks. On Wall Street, CoreWeave is regularly referred to as one of the most…

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Trump chose a casino to promote his economic policies while dismissing the issue of affordability

Trump chose a casino to promote his economic policies while dismissing the issue of affordability

The Washington Post reports: He had charts that he read from, touting economic data. The stage around him was filled with signs reading, “Lower Prices Bigger Paychecks.” He introduced Pennsylvanians who he said had more take-home pay because of his policies. But if he was supposed to launch a speaking tour to clearly connect with Americans struggling with higher prices and stagnant wages, President Donald Trump didn’t hesitate to veer off course. He mocked the word “affordability,” touted how high…

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America’s largest bitcoin miners are pivoting to AI

America’s largest bitcoin miners are pivoting to AI

Joel Khalili reports: One afternoon in June 2024, I stood up against the fence of a sprawling industrial facility a few miles outside of Corsicana, Texas. Over a metal gate, I watched a bright yellow excavator claw at the dirt and flatbed trucks shuttle to and fro. A hangar-like structure with a gleaming white roof stretched hundreds of meters along the opposite perimeter. The company that owned the plot, Riot Platforms, was busily constructing the world’s largest bitcoin mine. A…

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Thanks to Trump, the world’s largest superyachts are increasingly being bought by Americans

Thanks to Trump, the world’s largest superyachts are increasingly being bought by Americans

The New York Times reports: Today’s superyacht buyers are younger and richer than they were a decade ago, and they’re increasingly American, enriched by the pandemic business boom, a roaring stock market and deep tax cuts. Rather than wait for a gilded retirement, they are buying in their prime, looking for a plaything with all the trappings of home. They’re tethered to the world with Starlink internet while they play in St. Barts or Sardinia, or venture to more out-of-reach…

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How a cryptocurrency helps criminals launder money and evade sanctions

How a cryptocurrency helps criminals launder money and evade sanctions

The New York Times reports: Smugglers, money launderers and people facing sanctions once relied on diamonds, gold and artwork to store illicit fortunes. The luxury goods could help hide wealth but were cumbersome to move and hard to spend. Now, criminals have a far more practical alternative: stablecoins, a cryptocurrency tied to the U.S. dollar that exists largely beyond traditional financial oversight. These digital tokens can be bought with a local currency and moved across borders almost instantly. Or they…

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Costco sues Trump administration, seeking refund of tariffs

Costco sues Trump administration, seeking refund of tariffs

NBC News reports: Costco Wholesale has sued the Trump administration, asking the Court of International Trade to consider all tariffs collected under the International Emergency Economic Powers Act unlawful. The company said in a filing Friday that it is seeking a “full refund” of all duties under the act paid as a result of President Donald Trump’s executive order that imposed what he called “reciprocal” tariffs. “Because IEEPA does not clearly authorize the President to set tariffs … the Challenged…

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The Kremlin pitched the White House on peace through business. Trump and his cronies are on board

The Kremlin pitched the White House on peace through business. Trump and his cronies are on board

The Wall Street Journal reports: Three powerful businessmen—two Americans and a Russian—hunched over a laptop in Miami Beach last month, ostensibly to draw up a plan to end Russia’s long and deadly war with Ukraine. But the full scope of their project went much further, according to people familiar with the talks. They were privately charting a path to bring Russia’s $2 trillion economy in from the cold—with American businesses first in line to beat European competitors to the dividends….

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MIT study finds AI can already replace 11.7% of U.S. workforce

MIT study finds AI can already replace 11.7% of U.S. workforce

CNBC reports: Massachusetts Institute of Technology on Wednesday released a study that found that artificial intelligence can already replace 11.7% of the U.S. labor market, or as much as $1.2 trillion in wages across finance, health care and professional services. The study was conducted using a labor simulation tool called the Iceberg Index, which was created by MIT and Oak Ridge National Laboratory. The index simulates how 151 million U.S. workers interact across the country and how they are affected…

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How Big Ag is crushing farmers

How Big Ag is crushing farmers

  Farm debt is expected to reach $560 billion this year—a record high. But it’s not just because of the trade war with China. Farmers told us it’s because a handful of corporations have taken control of their markets to ensure they always win, and farmers barely break even.

The real reason Trump is fawning over Saudi Arabia’s ruler

The real reason Trump is fawning over Saudi Arabia’s ruler

Noah Shachtman writes: You remember the pictures. The images of tech oligarchs kissing the ring at President Trump’s inauguration were instantly iconic, markers of a new and rather unnerving era. But months earlier, Mr. Trump made a corrosive pact with another set of moguls, and that one is already remaking global politics, wiping out jobs at home and strangling what little hope was left of avoiding a climate disaster. This one happened behind closed doors. These moguls were leaders of…

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Saudi crown prince promises massive investment in the U.S. but is running low on cash

Saudi crown prince promises massive investment in the U.S. but is running low on cash

The New York Times reports: The visit by the crown prince of Saudi Arabia to Washington this week painted a familiar tableau: the head of an oil-rich nation cozying up to President Trump and titans of American industry. That appearance of wealth is core to Saudi Arabia’s power and image in the United States and at home, where the Saudi government has vowed no less than an economic transformation for its young populace. In the Oval Office on Tuesday, Crown…

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