Bloomberg Surveillance TV: November 11th, 2026

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1:42This is the Bloomberg Surveillance Podcast. I'm Jonathan Farrow, along with Lisa Abramowitz and Anne-Marie Hordern. Join us each day for insight from the best in markets, economics and geopolitics. From our global headquarters in New York City, we are live on Bloomberg Television weekday mornings from 6 to 9 a.m. Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always, on the Bloomberg Terminal and the Bloomberg Business App. We begin this hour with tech leading stocks higher after strong results from CoreWeave. Julian Emanuel of Evercore writing, The pressure on the AI trade in the data center buildout is a slowdown is moderating significantly.

2:18We are careful and patient buyers of AI-centric stocks. Julian joins us now for more. Julian, great to see you.

2:24Julian Emanuel: Good morning. Are you buying NVIDIA? It is part of our basket, the AI class of 2027. We don't necessarily talk about single stocks, but it is core to the basket. And we've constructed this basket that wants to own chips, wants to own Mag7, wants to own software, because we believe that the theme broadly has much further to run. So talking more broadly, how much steam did Corweave give to the entire trade, given the fact that this has been one of the big skepticisms, that some of these neoclouds were kind of harbingers of the bubble to come? Very, very important. Because look, if you think about the stress in the markets over the last several months, the first wave of angst was when the 10-year yield ran through 5 % and went to 536.

3:13Julian Emanuel: And then, you know, the angst around, oh, no one will ever be able to issue debt again. the hyperscalers and et cetera. But this report in one of the credits that people have been most concerned about is really reassuring for a credit investor on all levels. Is it a feature or a bug that so many of its clients are the big hyperscalers and are so concentrated into just a handful of names? It's a feature. You can't get around it the same way You can't get around the fact that 10 stocks in the S &P 500 account for 41 % of the weight of the index. It's just how this entire theme these last four years have developed.

3:58Julian Emanuel: It's uncomfortable, but it's a reality that we have to live with, and it's a reality that's going to lead to GDP well in excess of 2 % next year. Can the AI trade continue in this reality if Jensen Wang was forced to step down by his board? We think it can. We think it can. Look, will it be a blow? Absolutely. Has that been reflected in the last several days? But I would point to this. The Nasdaq is materially higher on the screen right now than it was first thing Monday morning. And that tells you that this theme is bigger than any key man or key woman risk. So when you think about potentially the next catalyst or litmus test for this trade, is it going to be the Anthropic IPO?

4:44How are you thinking about that?

4:45Julian Emanuel: Absolutely. I mean, it is the same thing as the marquee IPO we had back in June that first broke the trillion dollar concept, is that it needs to go well. And lo and behold, the new slow around it over the last 24 hours is, you know, we're starting to think about upsizing the valuation. Well, I don't think we're going to think about that four or five days ago. And that is a positive. And we think, like earlier, you're going to have retail participation. And we have no reason to think that it won't go smoothly. You know, it might be a good thing that the bond markets closed today after what happened yesterday.

5:24You saw the biggest increase in the front end yields going back to April of 2025. How much of a torpedo is this and some of the optimism?

5:33Julian Emanuel: So look, in our mind, the bond market overshot to the upside, undershot to the downside in terms of yields the last few weeks, you're really going right back into the middle of the range. And I will say point blank, we don't think 50 is on the table December. They may talk about it. They may jawbone about it. Not happening. And if you think about it, is a lot of the reason, I mean, look, oil is 16, 17 % lower than it was at the end of October right now. And yes, we understand that the pass-throughs take time to pass through. But when you think about what Chair Warsh has been saying with regard to in the long term, this belief that AI will drive productivity in a disinflationary manner, you've got to manage the near-term noise to get to that long term.

6:29Julian Emanuel: and what we've seen in the last few months is that these companies are sensitive to massive gyrations in the fixed income markets. I understand that people point to oil and say this is going to be disinflation down the pike and I understand that people are saying it's a supply shock and consecutive supply shocks and it too will fade, give disinflation a chance. But as Chicago Fed President Austin Goulbs we pointed to, it was the services side where you saw inflation broadening out. You saw increasing pass-through in a whole host of different kind of areas. We've talked with different airline executives who've said demand has really hung in there significantly better than they expected.

7:07At what point do you have to increase your expectations of additional rate hikes, kind of like the way that Matt Lazetti over at Deutsche Bank did last night?

7:14Julian Emanuel: So, you know, Krishna Guha, our economist, basically is of the view that this past quarter was sort of peak growth for the cycle and that it's going to start moderating. Okay. If that view is incorrect, and we have no reason to believe at this point that it is, again, the glide path is towards 2.2 or 2.3 GDP in 2027. If growth re-accelerates, then you do have to re-examine the thesis for sure. The market was almost set up based off what Williams and Jefferson said. Really, Williams, one more hike, and then we're done, none in 2027. Then you have Waller coming out with this kind of bazooka, in a sense, really trying to upset the apple cart here.

7:56Is the market at least trying to digest that it's not going to be one more 25 and done? They're probably going to have to hike again in 2027?

8:03Julian Emanuel: Well, and this is the tricky part, right? Because I think we came in thinking that it would be sort of as few as possible, and that's the normal tendency. But history would tell you that that is very rarely the case with Fed hiking cycles. But from our perspective, we'll take Chair Warsh's tack. We're not going to give you forward guidance past December. We definitely think you get 25 in December. And then let's see what the data shows and how things start to evolve. Can the U.S. maintain its tech supremacy without Jensen Wang at the helm of NVIDIA? We believe it can. And again, I point back to the fact that the Nasdaq is broadly higher than it was Monday morning.

8:50Julian Emanuel: It's clearly a blow. No question about it. And again, this is the genius of capitalism. It's never bigger. One person is never bigger than capitalism in general. And I think the ecosystem will evolve. You have a lot of other incumbents. Clearly, they don't provide what it is that Jensen Wong is providing right now, but there will be adaptation. And we think, you know, similar to all these other moments, deep seek and situational awareness and, you know, frontier models, different, et cetera, et cetera, that we will get past it successfully. At a minimum, does NVIDIA need to come out to the public and share with its investors its succession plan?

9:39because they don't have one right now.

9:40Julian Emanuel: Well, I think when you think about companies in general, the script is whenever you have controversy like this, you just have to be more transparent. Whatever that is, there has to be a greater level of communication. Are you starting to think about more of heightened export controls because that could potentially get in before the end of the year? So it's not just heightened export controls, but remember, and the news flow has been so intense the last several weeks is that we forget a month ago or so we were talking about, you know, people within the industry wanting to, you know, do more around safety and guardrails and regulation, etc.

10:21Julian Emanuel: And maybe, just maybe, the glass half full interpretation is that there will be a little bit more oversight, you know, without killing the goose, which certainly is President Trump's intent is to let it run as free as possible. But this could be a catalyst for more constructive oversight. How do you model that? I mean, there was a sort of feeling after the election, well, buy everything because I don't know why, and then sell everything because I don't know regulation. And then people are coming in to try to figure out how to price it and look at fundamentals. I mean, given the lack of certainty, where do you begin with a fundamental analysis of what regulation could do to the tech trade?

11:04Julian Emanuel: Well, honestly, I think a lot of it is in the price. If you look at it, the tech sector is trading at a valuation discount to the S &P 500 for the first time since 2010 and arguably at a valuation that's more consistent with how tech traded before the start of the internet revolution, let alone the AI revolution. So in our mind, you know, could this at the margin, dent the earnings growth profile. Look, at the index level, consensus is calling for about 15.6 percent growth in 2027. We think it's probably closer to 10 percent. Double digits is still likely to be good enough for stocks. But again, I just think this whole idea of adaptability and flexibility and seizing opportunities as they arrive is the way it's going to evolve.

11:59Do you think, though, that more restraints put on the tech sector could slow the U.S. economy? And this is sort of one of considerations that people have been looking at in going into bonds. Do you think that that's a feasible kind of knock-on effect that would leave you, yes, maybe more bullish on tech, but maybe not as bullish on the rest of the index?

12:17Julian Emanuel: Well, it's definitely feasible. And when people try and model what AI's contribution to GDP is, is that there's a tendency to undercount the knock-on effects to employment and, you know, gas station X near Elon's new town wouldn't have existed and things like that. But the fact of the matter is that, you know, in general, you're at this point where there's uncertainty. We are four years into a bull market. It should be a little creakier at this age, but by no means over. And the idea of whether you're a Democrat or Republican, the last thing you want to do is be pinned as a catalyst for an economic slowdown.

13:06Julian Emanuel: That's off the table or should be off the table. Stay with us. More Bloomberg Surveillance coming up after this.

13:16Julian Emanuel: If you invest or lead a business, one-sided views aren't enough. Join me, Brad Rogoff, and my team at Barclays Research as we debate what's driving markets on the Flipside podcast. Find the Flipside wherever you get your podcasts. This is the Bloomberg Tech Minute brought to you by ChatGPT. I'm Carol Masser. Chinese automakers have become famous for turning cars into rolling smartphones decked out with large touchscreens and flashy software. Now they're going back to design basics, touting the return of buttons and knobs. The reintroduction of physical controls coincides with a broader push by Chinese regulators to overhaul the EV industry's potentially harmful design choices.

13:57China's Ministry of Industry and Information Technology proposed updated national vehicle standards that specify certain functions, like those that control headlights or change gears, should be physical rather than digital. While door handles have been the most high-profile change, resulting in millions of cars being recalled, screens have also drawn scrutiny because they can pose a safety risk should they lose power or brake. The trend of adding physical controls is not limited to China, with Mercedes-Benz Group also introducing buttons in its new models. That's the Bloomberg Tech Minute brought to you by ChachiPT.

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14:39Under surveillance this morning, NVIDIA facing congressional backlash.

14:43Julian Emanuel: I just know Jensen very well. I just think he's a very honorable man. The press reports that Trump was briefed more than a year ago. I feel very confident that he'll be in good shape. One of our most important companies that's involved in national security. And the CEO might be having an affair with a Chinese spy, and Trump did nothing about it. Years later, Senate Minority Leader Chuck Schumer blasting President Trump's inaction over Jensen Huang's relationship with a suspected Chinese spy. As House Republicans threaten to subpoena the NVIDIA CEO if he doesn't respond to their requests to attend a closed-door briefing next week, Jeanette Lowe of Baird Strategas writing, Democrats were already planning to investigate a number of companies next year, including NVIDIA.

15:25Investigations will only intensify as it relates to chip exports and national security concerns. Jeanette joins us now for more. Jeanette, great to have you on the show. I want to start there with whether there is cohesion among both Democrats and Republicans about what kind of chip export strategy the U.S. should maintain. Yeah, absolutely. So thank you for having me. So I think there is definitely becoming much more of a concerted effort to take a bipartisan look at this. Now, the legislation, the pieces that Tyler had just mentioned do have bipartisan support. They hadn't necessarily been included in the House version of the National Defense Authorization Act, but they had been included in the Senate version.

16:02But some of these, companies had pushed that they were going too far, and there had been some pushback from members of Congress to actually natch them. This new situation with NVIDIA is going to propel those provisions to likely be included as part of the bill when it gets done by the end of the year. You could even see some additional ones. There's also been concerns about companies being able to do remote access through cloud infrastructure related to chips and gaining access to NVIDIA chips or more advanced chips that way as well. So you're definitely going to see much more of a concerted bipartisan effort to get something done to really kind of crack down on whether or not there were some leaks of chips.

16:39There's been some sort of changes in how export controls had been pressured in Washington, if that were to be true. And that's definitely going to be much more of a bipartisan focus going forward. Jeanette, we also have some Republicans, including North Dakota Senator Kevin Kramer, saying Jensen Wang should be stepping down. If they decide that they are not going to agree to come to this hearing and bring Jensen to Washington, D.C., what happens next? Yeah, so, I mean, obviously they can definitely do some adjacent investigations related to what people know and try to dig into it deeper. And sometimes, obviously, just even having the larger political outlook, the PR that would be on top of that would be susceptible to the company.

17:23Now, this was supposed to be a private briefing that they had asked him to attend. He may ultimately do so at some point, particularly as the pressure mounts. But we'll kind of have to see where Congress takes this. But definitely already Democrats, as you mentioned, were planning to do investigations with regard to NVIDIA for various pieces. The fact that there could be one of the top companies involved in the USAI trade being under investigation for potential influence by Chinese operatives is going to definitely get a lot more attention. And it's going to be harder for the company to completely block them from looking into it.

17:58Given Alice Wong's company was Megaspeed and that's been under investigation by the Commerce Department, do you think the president is going to have to make changes there? Yeah, I mean, I think obviously Congress is going to do one of its proposals. A lot of this does have to come out of the executive office as well. So we'll see if they start making changes. I mean, there was talks about, you know, that their secretary, Lutnik, had been informed about this investigation. So there's definitely obviously been concerns about where export controls have been. We already know there's been several stories about NVIDIA chips being lost or stolen.

18:33All of these things are going to put much more heightened scrutiny on commerce to actually tighten those controls and maybe do something internally, particularly if Congress is also looking to be more aggressive. Is it your understanding that this Commerce Department gave NVIDIA preferential treatment? You know, it's hard to say, right? Obviously, we do know that Jensen Wang had been pushing for lighter export controls for the ability to continue to push to be able to sell his chips to China. I think there's definitely going to be a lot more digging and looking under the surface as to what kind of these relationships were, what were the asks, and potentially why.

19:08So we still probably have a lot more to go to see what's kind of underneath here. But I think this will definitely be a big focus going forward for the months ahead. Aside from just the chip export restrictions, on a broader level, how much do you foresee certain Republicans and Democrats working together, given some questions around President Trump's lead, whether sort of the Trump era of Republicans is on the wane, how much that really opens the door to bipartisanship? Yeah, I mean, I think one of the things is that there's various issues in Washington that definitely have bipartisan flavor to them.

19:43And obviously, national security is one of them. There are definitely China hawks in both parties. And this is going to be something that's going to give them a lot more prescience. You know, we had a number of these individuals who were sitting for the past two years, rather uncomfortable with some of the moves that the administration had been making, feeling that they were being too deferential to China. Now, obviously, the U.S.-China relationship is a little bit more rocky in the past few months than we have seen, because obviously we only did a two-month extension of that U.S.-China trade deal.

20:13But I think they're going to definitely have those members being a lot more vocal and punishing a lot more on the administration to make things a lot tighter for China and kind of restricting where there might be national security concerns going forward. Stay with us. More Bloomberg surveillance coming up after this.

20:35This is the Bloomberg Tech Minute brought to you by Chachi PT. I'm Carol Masser. Chinese automakers have become famous for turning cars into rolling smartphones decked out with large touchscreens and flashy software. Now they're going back to design basics, touting the return of buttons and knobs. The reintroduction of physical controls coincides with a broader push by Chinese regulators to overhaul the EV industry's potentially harmful design choices. China's Ministry of Industry and Information Technology proposed updated national vehicle standards that specify certain functions, like those that control headlights or change gears, should be physical rather than digital.

21:12While door handles have been the most high-profile change resulting in millions of cars being recalled, screens have also drawn scrutiny because they can pose a safety risk should they lose power or brake. The trend of adding physical controls is not limited to China, with Mercedes-Benz Group also introducing buttons in its new models. That's the Bloomberg Tech Minute brought to you by ChachiPT. Get started at ChachiPT.com.

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22:35Sticking with Nvidia, shares gaining a bit of momentum after wiping out all of its gains for the year. Jay Goldberg of Seaport, the loan sell on the stock still with a$180 price target. We're through that now at$175. Goldberg saying that Nvidia is playing out like a Greek tragedy. If Jensen goes, the bull case goes with him. Trying to conceive of NVIDIA without Jensen seems impossible. Jane joins us now for more. Jay, great to see you. We spoke with you last week. You said that you were thinking of upgrading your rating on NVIDIA. Was that torpedoed by what we got over the weekend with the revelation of this extramarital affair?

23:16Yes, yes. To put it simply, yes. I think the risk of Jensen being removed from his role is significant. He is the heart and soul of that company. He has 70 direct reports. Everything runs through him. Without him, it's not quite clear what they are. And it's hard to think of anyone who could replace him. I've maintained all along that he's one of the best semiconductor CEOs ever. He deserves a lot of credit for that. and removing him now gives us a very, very different company at NVIDIA. And so I think that's a big risk. At the same time, Jay, there are a lot of incredible engineers there, and there's been some speculation that NVIDIA could follow an Apple type of approach where once Steve Jobs was no longer there, they had an excellent executor like Tim Cook who could come in and really steer the ship forward with the blueprint initially laid out.

24:10Why is this different than that? At Apple, there was a transition period. We knew long before Steve Jobs left who the next CEO would be. It's clear that they had succession planning in place for Tim Cook for a long time. There was a planned out process, an orderly process. at NVIDIA, I sort of challenge people to name an executive there other than Jensen or their CEO. Beyond that, people don't really know the other executives at the company. And that's been a deliberate strategy at NVIDIA all along, is to make Jensen very much the picture of the image of the company. All public events are, you know, he's the one speaking.

24:54We just don't know that much about the other executives. And so who would replace him? It's completely unclear. Jay, is that a failure of the company, the fact that they haven't actually started building out for succession? I don't want to pile on too much. I think it's one of those things. The fact that he has 70 direct reports has worked to their advantage for a long time and makes them much thinner, much flatter, able to make decisions much more quickly than their competitors, who tend to be more bureaucratic. and the drawback is that we're in this position now where there's no obvious succession.

25:34Do you think it's going to the political pressures that force him? I mean, you're already seeing Republicans calling for him to step down. The president's former NEC director, Larry Kudlow, is saying he needs to step down. Or do you think it's actually going to be the board finding out that just this relationship went too far? And potentially, we don't know yet, potentially within NVIDIA, he was pushing to give Megaspeed preferential treatment. We don't know that, but I'm trying to understand how you're thinking about this. So we don't know a lot. And I don't want to, again, pile on with moral judgments from him.

26:07That's not my place. But certainly, this is all political, like U.S. politics political, capital P political. This looks a lot like an organized, orchestrated political takeout. He has been very vocal and very active in political circles the last few years. That attracts a certain amount of rivalry in D.C., and it really feels like the knives are out for him from the political circles. In terms of what he was doing, it's going to be very hard, I think, for them to prove one way or another what her influence was on him. If any. And a lot of the things that he is sort of being accused of doing allegedly because of her are things that would he would be normally doing anyway.

27:01Right. Of course, he wants to loosen restrictions on sales to China. He's he's in the business of selling chips. He makes good arguments about that, that I think he would have made regardless of what he was doing on his private life. And in terms of Megaspeed being a big customer, I think that's the real question is what's really going on with Megaspeed. And I think that's part of the problem is it's all very murky. The export rules in this context are very, very gray and it's a pretty fine line. But so far, there's no actual allegation that Megaspeed itself has broken any laws. Jay, just putting aside the politics for a second and even the future of Jensen Huang, to the point you were just making, it's not just Megaspeed.

27:43It's also all of the potential shell companies or just companies that are funneling NVIDIA chips to China. Do we have a sense of what proportion of NVIDIA's sales could have been tied to that type of activity? We don't. They reclassified how they determined geographic segments two or three quarters ago and shifted everything around. So it's a lot less clear. My best guess is it's about 20 percent of sales go to to China and Southeast Asia. So it's a significant portion of the revenue. But, you know, again, so far, most of it is all of it's been legitimate. The problem for them is that it's it is so murky that there are going to be there.

28:32People are very focused on this. And that's really the heart of the questions of what's going on. If Jensen Wang is forced to step down and there is further questions about NVIDIA's ongoing leadership, not to mention just where the sales are all coming from and there are some congressional inquiries that continue, what is the impact on the broader chip sector, the broader AI trade at large? I think fairly minimal, right? They're going to report next week and I think they're going to report pretty good numbers. I don't know that anyone's going to care about them. but the AI trade is real. I think there's still demand for AI chips.

29:08It's just, I think, regardless of what happens with Jensen, NVIDIA is somewhat hobbled just for the time being. If for nothing else, they're going to be spending a lot of time with lawyers that they can't spend on their business. And that is going to be a good opportunity for companies like AMD and Broadcom to pick up share. This is the Bloomberg Surveillance Podcast bringing you the best in markets, economics and geopolitics. You can watch the show live on Bloomberg TV weekday mornings from 6am to 9am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always on the Bloomberg Terminal and the Bloomberg Business App.

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