Congress, Zuckerberg Address AI Dangers; EU Proposes Canada Membership

0:00Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans.

0:42Healthcare doesn't always work great. If you've ever waited on a refill or couldn't schedule an appointment, you get it. That's the kind of stuff Optum is changing. They're using data and technology to integrate patient care, pharmacy, and everything else. So healthcare is connected, not complicated. What's that look like? Cheaper prescriptions that are easier to get and care that looks at the whole person, how you need it. Optum is helping make healthcare work as one for everyone. Learn more at business.optum.com. This is Robert Smith from Business History. If you're listening to this, there's a good chance you're a small business owner.

1:16And like every small business owner, you started with a dream to do what you love and watch it grow. What you probably didn't dream about? Keeping up with cyber threats. That's where MasterCard can help with access to tools that help identify cyber threats to better protect your business. Building your dream business? Priceless. For cybersecurity in a changing world, there's MasterCard. Learn more at MasterCard.com slash smallbusiness. Bloomberg Audio Studios. Podcasts. Radio. News. Good morning. I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, we begin in Washington, where the debate over artificial intelligence safety is heating up.

2:02Sources tell Bloomberg Anthropics top executive in D.C. Tom Brown met virtually yesterday with Commerce Secretary Howard Lutnick and Pentagon Chief Tech Officer Emil Michael. Tensions between Anthropic and the Trump administration were revived over CEO Dario Amadei's 3 ,800-word essay calling for government guardrails for AI. President Trump is dismissing fears as a hoax, and House Speaker Mike Johnson says he agrees. We've all seen this movie before, okay? We're 49 days out from an election. A catastrophe is created. The media gets spun up. Social media gets spun up. Everybody says we're all going to be, they literally said we're all going to be dead in 10 years.

2:41House Speaker Mike Johnson spoke on Capitol Hill, but the issue has brought together some unexpected political bedfellows. Progressive Senator Bernie Sanders joined former Trump advisor Steve Bannon at a pro-human rally in Washington. If AI surpasses human intelligence, as many scientists believe could happen, this technology will escape human control with potentially catastrophic consequences. Independent Senator Bernie Sanders, the Pentagon's Emile Michael, has publicly rejected claims AI will kill all humans. And sources tell Bloomberg that Secretary Ludnick is eager to push back at the negative messaging ahead of the midterms.

3:22Nathan, several tech leaders are weighing in on the safety and future of AI. And Bloomberg's Don Tucker joins us with that part of the story. John, good morning. Good morning, Karen. We're hearing from Meta CEO Mark Zuckerberg. He says artificial intelligence labs should rely on independent evaluators to ensure that models are safe. NVIDIA's Jensen Wong issued his opinion. He dismissed the need for new AI security regulations, arguing that market forces will help companies safely innovate. Now, to underscore some of the urgency of this debate, OpenAI says it is now working with its chief competitors, Anthropic and Google DeepMind, to address AI safety issues.

4:03The global policy chief for OpenAI says the company's engagement with Anthropic and Google has been underway for several weeks. And OpenAI says it will support bipartisan proposals aimed at addressing potential catastrophic risks. I'm John Tucker, Bloomberg Radio. John, thanks. And as the AI controversy heats up, OpenAI is holding early talks with investors about a fresh funding round that would value the chat GPT maker at more than$1.2 trillion. OpenAI CEO Sam Altman recently told Fortune the company's long-anticipated initial public offering wouldn't happen this year. Sources say the additional funding provides flexibility to push back the IPO until 2027.

4:45Let's turn to the economy now, Nathan, and what may be the most highly anticipated Fed decision in years. From Main Street to Wall Street to the White House, attention will be on new Fed chair Kevin Warsh. And we get a preview of the Bloomberg Economics correspondent Michael McKee. Investors have priced in a quarter percentage point rate increase, the first since 2023. What really matters, however, is what the Fed will do next. Don't expect much of a signal from chair Kevin Warsh, who has made it clear he doesn't like guiding the markets. But there will be clues. Policymakers will offer their latest forecasts on growth and inflation.

5:20If the outlook for either strengthens, it underpins a case for further rate increases. And there's the dot plot. Will it show a majority anticipate another move this year or in 2027? The current median dot for 2027 anticipates essentially no move. Finally, members will also update their view of the longer-term neutral rate. It's risen in 2026. Another move higher would signal Fed officials don't think rates are restrictive enough to bring down inflation. Michael McKee, Bloomberg Radio. All right, Michael, thank you. I'll stay with Bloomberg for complete coverage of the Fed with a special edition of Bloomberg Surveillance.

5:56It starts at 1.30 p.m. Wall Street time on Bloomberg Radio and television and on the Bloomberg podcast YouTube page. Karen, we have a developing story out of Europe this morning. European Commission President Ursula von der Leyen is proposing that Canada become the first associate member of the European Union. Let's go to London and get the latest with Bloomberg's Ewan Potts. Ewan. Nathan and Karen, Commission President Ursula von der Leyen says the European Union needs to urgently reimagine its partnerships and build global coalitions. She ended her annual State of the Union address with a surprise announcement.

6:30I would like to work with you on opening the door for Canada to being the first associate member of the European Union. As to exactly what associate membership of the European Union looks like, those details are yet to come. President Trump, a fan of neither Canada nor the European Union, will no doubt have a view. In London, I'm Ewan Potts, Bloomberg Radio. All right, Ewan, thanks. Now to the latest from the Middle East. Saudi Arabia is ramping up crude oil sales from outside the Strait of Hormuz with the East-West pipeline shut down. The kingdom was forced to close the conduit last week after multiple attacks, and Bloomberg's owner Ant has more from Dubai.

7:12This is what Saudi Arabia was relying on to export much of its oil after the problems at Strait of Hormuz began in February and March. And now with the Houthi attacks, both on Saudi energy sites and Houthis, including influence over the Bab al-Mandeb, which is another critical choke point for global shipping at the southern tip of the Red Sea, are now putting at risk Saudi exports to the rest of the world. And Bloomberg's owner Andra Pours, it's not clear when the pipeline can reopen, but traders tell Bloomberg that Saudi Aramco has sold about 20 million barrels this week to Asian refiners that can be picked up from just outside Hormuz this month and next.

7:49Meanwhile, back in Washington, Karen, the House has voted for a third time to call on President Trump to end the war with Iran. Seven Republicans joined with all Democrats on the War Powers Resolution sponsored by Massachusetts Democrat Seth Moulton. Republican Thomas Massey of Kentucky introduced his own resolution to impeach Defense Secretary Pete Hegseth. Every time we try to do something one way, they say we're not going to follow it. And I think the only way to stop this right now is to impeach Peter Hegseth. Congressman Thomas Massey spoke after the Congressional Budget Office released a new price tag on the war.

8:24It says the conflict cost about$38 billion in its first five months and will push up inflation about a half percentage point by early next year. Nathan, FBI Director Cash Patel testified before the Senate Judiciary Committee, where he confirmed that the FBI will send what he calls crisis coordinators to polling sites in November. Bloomberg's Amy Morris reports from Washington. Patel would not rule out sending federal agents to polling places on election day, saying that he's not sure the bureau is legally barred from doing so. Democratic Senator Peter Welch pushed back. Do you pledge that you will not in any way interfere in the will of the American people when they go to the polls in November?

9:06I pledge unequivocally that I will not participate in your charade of lies. Patel faced criticism from Democrats who accused him of using the bureau's law enforcement powers for political purposes. In Washington, Amy Morris, Bloomberg Radio. Amy, thank you. The crypto industry has taken a setback on Capitol Hill. The Senate has failed to advance the Clarity Act, denying the industry a chance to turn its newfound influence in Washington into fresh rules that could outlast the Trump administration. This means regulators like the Securities and Exchange Commission and Commodity Futures Trading Commission will continue to make crypto rules that could be easier for a future administration to change.

9:42And we want to introduce you to Ask B, Nathan. Bloomberg's conversational AI for company and markets research. Ask a question to analyze companies, uncover trends, and explore Bloomberg market intelligence alongside your firm's proprietary data. Type Ask B Go on the Bloomberg terminal or tap the Ask B icon in the mobile app. Time now for a look at some of the other stories making news in New York and around the world. And for that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Karen. One month after the board of the Kennedy Center voted to add President Donald Trump's name to the venue, the board voted on Tuesday to immediately close the Performing Arts Center's main building for renovations.

10:25The vote came after a federal judge blocked the board from adding a tribute to Trump on the building or site. Democratic Congresswoman Joyce Beattie of Ohio, who is a former board member, has been fighting the change. Beattie told reporters she will take all legal steps to keep at the Kennedy Center, adding it has been a quid pro quo for months. Every time there's an issue that comes up, it has been connected. it, we will consider to do this, but or unless it has Donald Trump's name on the building. President Trump says unless the Supreme Court overturns the judge's decision, the reconstruction and renovation of the Kennedy Center will not take place.

11:06Officials say an NBC News helicopter crashed in Los Angeles and killed at least three people. NBC4 confirmed that two people on the helicopter were killed. An official says one person outside in a parking lot was also killed. The helicopter was covering a fatal bus accident. Officials say two other people were killed and six others were injured after an SUV crashed into a city bus. Los Angeles Mayor Karen Bass in a news conference Tuesday night. We lost five Angelenos today and my heart certainly go out to the family and friends of all of those that we lost. Mayor Bass called it heartbreaking.

11:46trafficking. Weeks after a mistrial was declared in the Lindsay Clancy case, Massachusetts is taking a closer look at the postpartum care offered to mothers. Yesterday, Governor Maura Healy announced a proposal to expand at-home visits. To every mom who has struggled with her mental health before, during, or after pregnancy, I want you to know we see you. I see you. Governor Healy wants the state legislature to approve another$2.25 million to add to the current Welcome Family program. Global news 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg.

12:23Karen. Thanks Michael. Time now for our Bloomberg Sports Update and for that we bring in John Stashauer. Thanks Karen. Milwaukee Brewers NL Central champs for the fourth year in a row. They clinched with a 5-1 win at Pittsburgh. Jacob Misarowski with his 15th win of the year. Brewers will be playing in October and trying to get to the World Series for the first time since 1982. Dodgers a 3-0 shutout win at Cincinnati. That is Yashinobu Yamamoto got his 14th win, seven innings allowed only one hit. Milestone home run for Pete Alonzo, 300th of his career as Baltimore beat the Mets. Alonzo getting to 300 with a homer against his former team.

12:57That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful.

13:36Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChachiPT.com by selecting Work Mode, available on Plus and Pro plans. If you listen to financial news, you know a lot of time is spent thinking about what's next. The next opportunity. The next investment. The next move. But sometimes what matters most is being ready for what you never saw coming. A storm damages a second home. A pipe bursts above a collection you spent decades building. An unexpected loss puts a growing business on pause. Those are the days no one sees coming. But for more than 75 years, Cincinnati Insurance has been ready when they do.

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14:51This is Robert Smith from Business History. If you're listening to this, there's a good chance you're a small business owner. And like every small business owner, you started with a dream to do what you love and watch it grow. What you probably didn't dream about? Keeping up with cyber threats. That's where MasterCard can help. with access to tools that help identify cyber threats to better protect your business. Building your dream business? Priceless. For cybersecurity in a changing world, there's MasterCard. Learn more at MasterCard.com slash smallbusiness.

15:24Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and around the world on Bloomberg.com and the Bloomberg Business App. This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. The fast-building debate over artificial intelligence risk has now led to a high-level conversation between the point man for Anthropic in D.C. and the Trump administration. Some of the biggest names in the AI space are discussing the threat among themselves as well. OpenAI CEO Sam Altman says he's taking the issue seriously. The world should trust that we are going to do the right thing because it's the right thing and because we feel the magnitude of this.

16:05Open AI's Sam Altman spoke at the Salesforce Dreamforce conference in San Francisco. Joining us now is Bloomberg News senior strategist Neil Campling. Neil, it's good to speak with you this morning. What is your sense of how seriously the industry is taking the warnings from the likes of now former AI researcher Jacob Coxon and others? Good morning. Good morning. I think you succinctly said that former executive. So a lot of these stories that are coming out are coming out from people who are leaving the AR companies. Is this because they're sort of firing emissive as they're leaving the building or are they leaving the building because they are concerned about the risks with the technology?

16:50It's not it's unsure at this stage. What we do know is clearly the AR developments are extremely quick. And that also comes with increasing with increasing risks. We know that there are talks around guardrails. There are talks around hitting the brakes on AI development. Now, it creates a difficult situation, but these technologies themselves are obviously fast growing, have substantial increases in their speeds. But they also require some forms of guardrails around them. But they also need to stay ahead of the Chinese competition. And that's where I think the President Trump has come in with the with the missives against Anthropics CEO over the weekend.

17:37But there needs to be sort of careful management of of the tech development while staying ahead of competition. I think we heard that expressed as well in the now famous 3800 word essay from Anthropics CEO Dario Amadei calling for guardrails. What's the balance that these companies need to strike, Neil? So the balance partly is that, you know, if we look at the Trump administration, for one thing, the the AI development that's feeding through into many parts of our economy is, you know, is very productive for GDP. You know, so so that's that's one side of things. So we need to encourage the growth.

18:18We need to make sure that the US stays ahead as the ultimate leader in terms of tech development, as it has been for decades. So we need to tread carefully, clearly, because Beijing is getting up the technology curve. China has narrowed that technology gap on AI. So whilst you need to put in place, if you like, some of the guardrails, as you say, around this, It's interesting that, say, another leading tech CEO, Zuckerberg, Meta, is saying that independent evaluators could help ensure that models are safe rather than being too restrictive. And by doing that, perhaps we can then maintain that leadership position that the U.S.

19:03enjoys today. Well, as the debate continues about potentially pacing development, it seems as though the pace of fundraising for these companies isn't really letting up. We're getting word that OpenAI is talking about a new funding round that could price it at$1.2 trillion. In our last minute here, does it seem like this debate will have any impact on that? Yeah, I think maybe what we're seeing now is that we're seeing perhaps another fresh round of private capital raise as opposed to rushing the coming to market. Clearly, the tech developments are very expensive and need the funding. And I think that still that we're looking at a valuation of 1.2 trillion is very supportive for the narrative here, because we last looked at the last funding round, raised at about less than a trillion, about$965 billion valuation when it raised funds back in May.

19:58So it's a good sort of headline number in terms of the potential market capital company still need to raise the money and they're still investing at pace as all of the AI developers are. So that is definitely supportive for the AI narrative. This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify, or anywhere else you listen. You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121.

20:41Plus, listen coast-to-coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces. And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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