Trump's AI Safety Switch, OpenAI Targets $1.4 Trillion Value

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1:55Good morning, I'm Karen Moskow. And I'm Alexis Christophorus. Here are the stories we're following today. Alexis, we begin with the latest developments on the artificial intelligence front. President Trump is endorsing using outside auditors to assess the safety of AI systems through an accord with Silicon Valley leaders that seeks to sidestep new government rules in addressing a groundswell of concern over risks. Under the agreement forged at a White House lunch with nearly two dozen top tech industry executives, AI companies all committed to regularly meet to set best practices for the industry.

2:30There's going to be a tremendous self-policing aspect. We're also thinking about forming a committee of sorts where we put maybe 10 people on that committee. It could be from that group so that we can so the committee can watch over the whole enterprise. President Trump says existing laws would be enough to safeguard Americans from the potential risks of AI. And Karen, in an impromptu appearance on the West wing driveway after that event, industry leaders joined the president outside the White House, endorsing his desire to maintain a hands-off approach and let AI companies police themselves. NVIDIA's Jensen Huang, whose company makes the chips that have helped power the AI boom, said he saw no conflict between innovation, technology, and safety.

3:14This is the largest industrial revolution in history, and we're going through the single largest infrastructure build-out from human disorders. And so it's creating a million jobs here in the United States. We have chip plans coming up, computer plans coming up, we have factories coming up. And so it's creating just an enormous amount of jobs. Joining NVIDIA's Jensen Wong alongside the president was Dario Amodi of Anthropic. Whoever wins AI wins. I think that's very important. But I think the technology has very real risks. And, you know, the mechanism, how we address those risks is still under discussion, but we all need to work together to make sure that we can win and we can win safely.

3:56Anthropics' Dario Amodi and NVIDIA's Jensen Wang were joined by other tech titans, including Meta CEO Mark Zuckerberg, Microsoft CEO Satya Nadella, and SpaceX's Elon Musk. The decision to engage on AI safety appears to mark a shift for the president, who only last week rejected fears of catastrophic risk as, quote, a hoax. Well, one tech leader that was not in Washington for the luncheon, Alexis, OpenAI's Sam Altman. He was at OpenAI's Dev Day in San Francisco. Bloomberg said Ludlow was there and asked Altman about the safety of artificial intelligence. When we need to make a decision about slowing down our training or our model release so that we can make more progress and put more of our attention into safety, alignment, monitoring, security, we will happily do that.

4:46Now, of course, we're going to continue to make progress, but the world should always have confidence in our safety cases, in our safety claims, and that we are going to be responsible with this technology. OpenAI CEO Sam Altman speaking with Bloomberg's Ed Ludlow. OpenAI said this week that it had scrap plans to debut a GPT 6.1 version of its top-of-the-line Astra model flagging heightened risks after recent rogue AI hacking incidents. The company also apologized this week to Australia for a breach of government websites carried out by some of its AI models. And Karen, another major story we're following this morning comes out of Europe.

5:25UK Prime Minister Andy Burnham opening the door to a return to the European Union. Bloomberg Daybreak Europe anchor Caroline Hepker covered the Labour Party's conference in Liverpool and joins us with the very latest. Good morning, Caroline. Good morning, Alexis. Karen. Yes, Andy Burnham says that Brexit has done more harm than good to the UK. He wants clarity on Britain's relationship with its closest trading partner. A decade after Britain voted to leave the EU, he wants to look at all the options again. That could mean rejoining the single market or customs union or even fully rejoining the EU as a proposal at the next general election, which is due in 2029.

6:04But this is just one of the radical proposals that Burnham set out in what was an emotional speech in Liverpool. He also wants a new national care service paid for by paring back costs for state pensions, possible nationalisations of utilities coming. These big plans, though, are largely future focused. They could also signal tax rises. This at a time when the UK already has high government spending and high tax to GDP ratios. The markets are going to be watching what happens in the immediate future. The budget on the 28th of October, even as Andy Burnham has decided to tackle some of the most contentious issues in British politics.

6:43In London, Caroline Hepker, Bloomberg Radio. Caroline, thank you. Now to the latest on the war in Iran, Middle East crude oil flows are returning toward pre-war levels, according to an estimate from JP Morgan and Goldman Sachs. Bloomberg executive editor Stuart Livingston-Wallace has more. So, I mean, I think it reflects probably something resembling reality and that we know a lot more volume is going through, but I can tell you that absent of any other information, if I told you we're back up to 98 percent, whatever it is, of pre-war flows, you would expect the oil price to plummet and plummet by probably$50 a barrel.

7:16Why is it not doing that? Well, it's many months of accumulated deficits, so well over a billion barrels of lost Middle East supply that happened in the first few months. I think that was as of June, so goodness only knows what the number is today. And as Bloomberg, Stuart Livingston, Wallace, and checking oil prices now, they are indeed higher. We have Brent up 1 % at$103.64 a barrel. West Texas Intermediate is at$90.23. And Karen, high oil prices are just one of the contributing factors to Treasury yields hovering near multi-decade highs. Bloomberg's John Tucker joins us now with more. Good morning, John.

7:51Good morning, Alexis. Yeah, the 30-year Treasury yield has hit its highest since 2002. The accident of the bond market being driven by a sharp repricing of expectations for interest rate hikes in the U.S. to contain the energy-driven inflation. Rufara Chirisari at RBC Wealth Management has her eye firmly fixed on that long bond. Six percent on the third year is not a level that seems to be wildly out of any possibility. So we still expect that yields could still continue to trend higher from here. A chorus of Fed officials warned yesterday that tighter monetary policy is still needed to contain inflation.

8:29All eyes now turn to the release of the PCE this morning. the Fed's preferred inflation indicator. That may open the path toward 6 % on the 30-year bond, a level last seen 26 years ago. In New York, I'm John Tucker, Bloomberg Radio. All right, John, thank you. Another news this morning. The Supreme Court, for now, let the Trump administration resume deporting undocumented people to countries other than their own with little, if any, notice. The court will hear arguments on the issue in December, and the order lifts for now an appeals court decision that found migrants must have a chance to object.

9:03And in Washington, the former U.S. prosecutor who secured indictments against Donald Trump clashed with Republican senators during a Senate Judiciary Committee hearing. Bloomberg's Amy Morris reports from our nation's Capitol. Special counsel Jack Smith defended the integrity of his investigations and said career prosecutors who worked on the cases have been illegally fired. He told lawmakers that President Trump committed serious crimes against the country. Our investigation developed proof beyond a reasonable doubt that President Trump engaged in serious crimes against our nation. Rather than accept his defeat in the 2020 presidential election, President Trump engaged in a criminal scheme to overturn the results and prevent the lawful transfer of power.

9:49Republicans charged Special Counsel Smith had political motives to go after Trump and the Republican Party. In Washington, Amy Morris, Bloomberg Radio. All right, Amy, thank you. We turn now to Michigan, where Bloomberg spoke with JPMorgan Chase Chief Executive Jamie Dimon. He talked about the global economic outlook and says trade deals help strengthen the U.S. and Western economies. Obviously, if we're being treated unfairly, we should fix it. But my view is we should try to get these trade deals done. It's better for the U.S. It's better for those countries. You know, I don't know all the complexities.

10:22I can't get into exactly why we're running into roadblocks, but I would like to see them completed. And JPMorgan Chase, Chief Executive Jamie Dimon was speaking with Bloomberg's David Weston in Michigan, where the bank committed$1 billion of debt capital to support Michigan manufacturing sector over the next decade.

10:43Time now for a look at some of the other stories making news in New York and around the world. For that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Alexis. New York Governor Kathy Hochul called for an independent review of Cornell University's handling of the 2024 incident at a fraternity that resulted in new allegations of rape and sexual assault. A civil suit filed in New York Supreme Court alleged a former Cornell student was drugged and raped by seven students in 2024 and that the university, the fraternity, and her sorority failed to protect her. It has brought attention to a law some New York state lawmakers say allows attackers to go free.

11:22It's called a voluntary intoxication exclusion. That means an intoxicated victim of sexual assault is still capable of giving consent if they knowingly take drugs or alcohol. However, New York State Assemblyman Jeffrey Dinovitz has been trying to repeal the law for years. Their job is to get people off, but our job is to fight for people, to make sure that people who are the survivors of sexual assaults get justice. And that's what this bill will help to. Cornell says that they are committed to working with state officials to advance student safety. Former New York Governor Andrew Cuomo reflects on the upcoming midterm elections.

12:01Cuomo told Scarlett Fu and Tim Stenevek on Bloomberg Crypto, this isn't about the Democrats, it's about the Republicans. There is a lot going on in the world. And there's a lot of anxiety. War in Iran, tariffs. the American people want stability. They want predictability. And they believe they get that with a balance of power. Former Governor Cuomo on Bloomberg Crypto. A Staten Island judge blocked New York's Pierre Deterre tax rollout for a second time, saying the city improperly published property information and wrongly required homeowners to apply for exemptions. The judge ordered the city to take down a supplemental role of luxury second homes that could be subject to the tax and replace it with a more limited list.

12:50Global News 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg Alexis. All right, thanks Michael. Time now for our Bloomberg Sports Update and for that we bring in John Stashauer. The start of the baseball postseason with four best of three wild card series starting in Atlanta where Austin Riley hit a three-run homer in the eighth inning. The Braves beat the Phillies 5-3. The White Sox won 6-3 at Houston. The Yankees poured it on over the Red Sox winning 9-0. Ben Rice had four hits, six RBIs, and San Diego shut out the Cubs 8-0. The start of the NHL season, defending cup champion Carolina hoisted the banner, then got shut out and lost in overtime to Florida 1-0.

13:30That'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.

14:09Put 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. This 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.

14:41For cybersecurity in a changing world, there's MasterCard. Learn more at MasterCard.com slash smallbusiness. Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a health care company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers.

15:17Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. So there's a lot of noise about AI, but time's too tight for more promises.

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16:22Coast 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. And good morning. I'm Karen Moscow alongside Alexis Christophorus. President Trump endorsed the use of outside auditors to assess the safety of artificial intelligence systems through an accord with Silicon Valley leaders. It would sidestep the need for new government rules to address the groundswell of concern over AI risks. And President Trump discussed the accord after he met with tech leaders yesterday. They love our country. They love the world.

16:58And they came together and they did something that few people really it's almost like a constitution in a way. And for more on this story, we're joined by Bloomberg senior strategist Neil Campling. Neil, good morning. Let's start with the basics. What is this accord all about? Good morning. So this accord, and it's important to stress that it's not legally binding. So, but it's committing the AI companies to regularly meet and set best practices for the use of AI for the industry. And the big piece around this is about implementing what they call four layers of controls to make the coding and the technology sort of open to the outside scrutiny on a weekly basis to make sure that the safeguards are in place for the technology use in itself.

17:53So it's good that we have these kind of agreements that are taking place, but I also think it's good that we don't have kind of restrictive legal parameters because it's really important that the us remains at the leading edge of the of this massive tech revolution and ahead of competition coming up from china so it ticks a number of of those boxes but i suppose um you know not everyone is necessarily uh um uh sort of bullish if you like on this development because some are saying that perhaps the policy response is just a kind of superficial rebranding attempt, if you like, that it's, you know, because we haven't got legal rights around this.

18:43But they did say that that could follow in due course. Yeah, because, you know, the president did say it is morally binding. But really, when it gets down to it, is that enough to really calm these concerns? Can you tell us more about who has signed on? We know it was the people who were at the luncheon with the president. Are those the only people who have signed on so far? So the ones that we know that have signed on, as far as we know, are Anthropic, NVIDIA, and OpenAI. Now, for a start, they are the three, if you like, probably the most prominent AI companies, the front end models and the key enabling technology from NVIDIA's ecosystem and chips.

19:29We also know that SpaceX, SpaceX AI has signed on, has Meta platforms and Google's Alphabet, and as well, we believe there's Palantir as well. So it has got really near enough all of the main tech leaders involved in this sort of cooperation. And that's critical, obviously, that everyone's basically on the same page in ensuring we've got the right protocols going forward. Well, does it also help to ease concerns about the risks and that maybe people will actually police themselves when we hear stories like OpenAI scrapping plans for one of its models because it went rogue? I think that's a great question.

20:13And actually, if I look back over the last 30, 40 years of tech dominance that the US has enjoyed, a lot of the massive waves that we've seen have come about from that self-regulation. I think the tech industry actually has been at the forefront of putting in place its own curbs and knowing when it's important to put those guardrails in place. So yes, there has been a lot of concerns around reports about existential threats, etc., which clearly we cannot belittle. But at the same time, I think the technology is, you know, the companies themselves at the forefront of Silicon Valley are very good at making sure that protocols are followed.

20:55And they're cooperative as opposed to just simply being seen as rivals to each other. And ultimately, this would be enough to keep, which was the big concern, the United States competitive against China and keep China, well, basically keeping US still in the game to be a winner rather than a loser in this race. So according to President Trump. Yeah, I really think that's important in terms of, you know, we know that the AI and its related spending is critical to US growth and US GDP. It's also critical to stay ahead of that Chinese competition. We've had some updates overnight about DeepSeek using Huawei chips to try and replace some of the Nvidia chipset, for example.

21:37So in some respects, China is a long way behind. And in other ways, they seem to be a very fast follower catching up. So it's critical for U.S. to remain ahead and for the U.S. growth, which relies on AI to remain ahead of that competition, for sure.

22:04Eastern 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. Plus, 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.

22:42And I'm Alexis Christophorus. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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23:28And 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 small business. This coffee shop running smooth. Thanks to genius from global payments, instant transactions, effortless inventory and synchronized operations, big league reliability for any business.

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