Newsom Orders AI Lab Kill Switch

Author: Bloomberg Television · Watch on YouTube

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Original language: English

Original video: Newsom Orders AI Lab Kill Switch · Channel: Bloomberg Television · 47:40 · Watch on YouTube

Topics: AI governance and regulation, AI infrastructure and hardware, Markets and economy

Summary

The program examines energy demands from AI data centers, with Emerald AI’s founder describing how flexible computing and on-site batteries could ease pressure on power grids. Political contributors discuss state and federal efforts to address data-center impacts, including California Governor Gavin Newsom’s proposed AI safeguards and kill switch. The hosts also look ahead to President Trump’s meeting with Chinese President Xi, focusing on trade, AI competition, and chip controls. The final segment covers shifting midterm election dynamics and features Kentucky Democratic Senate nominee Charles Booker discussing his campaign and policy priorities.

Key points

Emerald AI says data centers can reduce or shift power use during periods of grid stress, potentially connecting to existing grid capacity faster.
The company says flexibility can come from slowing or moving computing tasks, as well as using on-site batteries.
Emerald AI, Google, and Nvidia launched the AI Energy Management Alliance with 20 additional partners to advocate for flexible data centers.
The House passed a ratepayer protection bill, while state leaders are pursuing their own data-center and AI policies.
California Governor Gavin Newsom’s executive order calls for independent oversight, safety checks, and consideration of an AI kill switch.
The White House’s planned meeting with President Xi is expected to address trade and AI, amid uncertainty about extending the trade truce and managing chip exports.
Political analysts say concerns about costs and other administration policies could widen the map of competitive midterm races.
Kentucky Senate nominee Charles Booker says his campaign is building a cross-party coalition and supports Medicare for All.

Chapters

Start	Chapter	Summary
00:05	Program introduction and AI on the agenda	The hosts preview the day’s discussion of data-center energy, AI policy, markets, and the upcoming Trump–Xi summit.
02:10	Market update and AI security debate	Bloomberg reports on market movements as the hosts revisit debate over AI safeguards and President Trump’s comments on the risks of AI.
06:00	Trump–Xi summit and trade truce	White House correspondent Tyler Kendall discusses the summit’s possible goals, trade tensions, tariffs, and AI competition.
09:14	Data-center policy and Emerald AI	The hosts introduce Emerald AI founder Verun Sevar and his proposal to make data centers flexible users of electricity.
10:49	How flexible data centers could support the grid	Sevar explains how data centers could shift or slow computing and use batteries to reduce grid strain and help control costs.
14:00	AI Energy Management Alliance	Sevar describes engagement with regulators and the alliance formed by Emerald AI, Google, Nvidia, and other partners.
17:18	Automating data-center flexibility	The interview explores automated power adjustments and demonstrations designed to keep critical computations running during grid disruptions.
21:07	State AI policies and political reactions	The hosts discuss executive actions by Virginia and California, including Newsom’s proposals for AI oversight and a kill switch.
22:09	Political panel on regulation and investment	Rick Davis and Jeannie Shanzino discuss whether states and industry will lead on data-center policy and how investors view AI.
28:02	AI, China, and the upcoming summit	The panel considers how AI competition and chip access may feature in Trump’s meeting with Xi.
32:16	Markets and Westinghouse IPO report	Bloomberg provides another market update and reports that Westinghouse Electric is said to be targeting a valuation above $50 billion in a US IPO.
34:55	Midterm election map	The hosts and Bloomberg editor Bill Faries discuss polling that suggests races in Kansas and other states could be more competitive than expected.
40:46	Charles Booker on Kentucky’s Senate race	The Democratic nominee discusses his campaign’s coalition, his criticism of Mitch McConnell and Andy Barr, and his healthcare priorities.

Quotes

aims to transform AI data centers into flexible allies of the power grid. — 10:49

You can have more data centers, more innovation, you can have lower rates for communities, and you can have more reliable grids. — 14:00

independent oversight of AI companies. — 21:39

the creation of an AI kill switch. — 21:39

needing that insulin is not a Democrat or Republican issue. It’s a human issue. — 46:37

Concepts and entities

Emerald AI, Verun Sever, NVIDIA, Google, AI Energy Management Alliance, Emerald Conductor Platform, Gavin Newsom, Charles Booker, Donald Trump, Xi Jinping

Full transcript (original language)

00:05 Live from Washington DC, this is Balance [music] of Power with Joe Matthew and Kaylee Lines. >> If the government cannot do it, maybe industry can. Welcome to the Friday edition as a new alliance of AI companies comes together here with a promise to solve the data center energy issue just as it becomes one of the biggest topics on the midterm campaign trail. I’m Joe Matthew alongside Kaylee Lines in Washington. You made it to Friday. No shortage of AI news today.

00:36 That is for sure. But Kaylee, we may have found a positive development here. Yeah, we’re looking forward to talking to the founder of Emerald AI about this notion that it doesn’t necessarily have to be that data centers create energy concerns for the communities around them. Uh, of course, this is in keeping with what we saw in the House this week before they got out of town for the premidterm recess. They voted on the rateayer protection uh pledge. The concern of course is about utility costs, but there also is the question of just is there going to be accessibility to power for everyone these massive data

01:06 centers. >> That’s right. Exactly. This is a slightly more clever solution. They’ve been putting their heads together and we’re going to be curious to learn along with you about how they’re going to do this. We’ll bring you to the White House uh for more with Tyler Kendall here as the president prepares for an awfully important week in geopolitics a week from today. Kaylee, we’ll be talking all about the summit with President Xi. >> Yep. That’s of course scheduled for the 24th after President Trump returns from the United Nations General Assembly where he’ll be in the early part of the week putting geopolitics front and center. of course ongoing hot wars in both uh the Middle East and between Russia and Ukraine and trade wars to

01:39 consider as well as Bloomberg has learned that the US is at least going to hold off on tariffs until after the Trumpqi summit is over. What happens once it is I guess remains an open question. >> Well, it’s interesting. We thought we’d be focused so much on trade and tariffs and I suspect that we will be but it’s artificial intelligence that has crept its way to the top of the agenda. >> Very true. And it just keeps bringing itself back to the top of the agenda. If you take a look at what Governor Gavin Newsome out in California is doing, for example, he wants to see kill switches for these companies. I feel like I’ve heard about that idea before and we’ll

02:10 get into all of that this hour. But we begin as always with a check on the markets on this final day of the trading week. TGIF Charlie Pellet, how’s it looking in New York? >> And right now we are looking lower across the board. And Kaylee, by the way, just remember, takes AI to spell Kaylee lines. We have got the Dow, the S&P, NASDAQ all in the red right now with the S&P trading lower by 14. Last stretch of a busy week for markets saw stocks falling, bond yields are rising. We’ve got the Dow industrials down 193 [music] drop there of 4/10en of 1%. NASDAQ composite index down onetenth of

02:42 1%. NASDAQ 100 index just about flat on the day has been swinging between gains and losses down now by undertenth of 1%. The socks, the Philadelphia stock exchange semiconductor index [music] up now by 1.1%. The VIX uh right around 15. The 2-year 4.73% with the 10-year currently yielding 4.99% the 30-year 5.33%. [music] Gold up $41. The ounce to 4383 up by about onetenth of 1%. [music] Crude holding just below $11 a barrel.

03:15 It is down today by 1%. Barrel of Brent 103.84 lower now by 1%. French President Emanuel Macau says he will convene a meeting of the group of seven countries in coming weeks to discuss a potential release from strategic oil product stockpiles as soaring energy [music] prices sap economic growth the meeting comes as fuel prices in Europe surge today as I mentioned we are looking at WTI here in the US down 9/10en of 1% barrel of Brent down by 9/10en of 1% oil

03:46 majors selling off Exon Mobile down 4/10en of 1% Chevron lower by 410 ten of [music] 1%. Kico Phillips down now by 1%. For on demand news 24 hours a day, subscribe to Bloomberg News [music] now wherever you get your podcasts. I’m Charlie Pallet. Joe and Kaylee. That is a Bloomberg Business Flash. >> All right, Charlie Pellet, thank you so much. As we look to close out a wild week that has been in the markets, of course, it was just this week that we got the Fed decision, which already feels like a lifetime ago. It was also just this week that we came into the week with conversations around

04:20 potentially the pacing of artificial intelligence. The heads of some of the biggest companies in the industry all having agreed last weekend of course that that may be necessary. President Trump fervently disagreeing with that over the course of the week. Uh especially in light of the anthropic former employees public resignation talking about how it could lead to the extinction of humanity. President Trump and many of those close to him have cast this notion as being a hoax, a conspiracy, a Chinese scop. Just listen to what President said. Trump has uh said about this

04:54 throughout the course of the last week and change. Do >> you have any concerns about AI leading to human extinction? No, I don’t have any I have uh concerns that if we don’t win AI, we’re going to be put in a very bad position. >> We’re leading China in AI. We could put guard rails. we can do this and that, but I think you have a lot of negative forces and are bringing it up that uh shouldn’t be bringing it up. >> Well, they’re going to bring it up at least the issue of AI and security next week, as we mentioned, when President Trump meets with President Xi, the

05:26 summit here in Washington. Whether this will resolve in some framework or AI security agreement uh has to be yet to be seen and it’s unclear exactly what the president’s goals are but it will be a who’s who of AI executives as well which is on brand for this white house Sam Alman will be there Jensen Wong Cristiano Aman from Qualcomm and it’s being reported uh that Jamie Diamond will be there I’m sure that’s going to be a much longer list and Tyler Kendall will be on hand to color to cover it all on the heels of the United Nations

06:00 General Assembly where the president will be as well at the start of next week. Tyler is our Washington correspondent and joins us now live from the White House. What are the president’s goals when it comes to President Xi? Tyler, do we have a sense of what this agenda will look like? >> Well, Joe, at this point, we’ve heard from a few analysts that if the US and China are able to extend the trade truce, keep the calm as it is, that in and of itself would be an accomplishment of a goal. as we learn more, including reporting from the Financial Times that the US may only be looking to extend

06:31 that truce by about 6 months amid what are heightened concerns with Beijing’s uh loosening or lack of loosening of export curbs related to critical and rare earth minerals. If you went through it though, there are a few points of contention that will probably come up, including front and center when it comes to artificial intelligence. Because this White House’s main argument against an industrywide slowdown has to do with the competition with China. Just last week, we heard from three national security agencies alleged that Chinese AI firms

07:01 are essentially stealing American IP through so-called distillation attacks. But if we put the fuller picture together, there’s so many different things that this White House has to weigh when approaching this meeting with Chinese President Xi Jinping, including when it comes to those export curves, not wanting to escalate on one front and have China retaliate on another. It is a balancing act next week. But the fact that Xi Jinping is expected to be here does play to the administration’s broader goal of keeping relations with China, at least right now, on balance. Well, and as you talk about an extension

07:36 for some period of time of their trade truce, Tyler Bloomberg is reporting that we won’t see any tariff action until after this meeting is concluded. So, at this point, it’s unclear exactly the reason behind this potential postponement uh of higher what was expected to be higher tariffs, but it could be perhaps a leverage tool for the White House as we go into the talks next week. A few points of context here. One, these were planned tariffs over allegations of Chinese overcapacity as the country ran a $1.2 trillion trade

08:08 surplus next year. The tariff rate was supposed to come in at 7.5%. I bring that up because it would have brought the average effective US tariff rate against Chinese goods under the second Trump administration to 20%. Which of course is a relatively large number, but it actually hits that cap that has been previously established with China under the current trade truth. So, it actually wasn’t really considered to be that major of an escalation. That is raising questions about exactly why these tariffs were postponed. Will there be a different rate depending on how the conversations go? Uh, Kaylee and Joe, we

08:42 may get more details on Monday. The US Treasury Secretary sent to meet with his Chinese counterpart over the weekend. >> Tyler, thank you so much. Live from the White House, Bloomberg’s Tyler Kendall with much more to discuss ahead of next week. It’ll be a very busy one around here with ANGA at the start of the week and of course the Shei Summit at the end of the week here on Balance of Power. We’ll have it all covered. Tyler is on her way up uh to Turtle Bay shortly after the close of business today. As a matter of fact, Kaylee mentioned one of the biggest and most important stories of the week when you talk about an

09:14 unproductive Congress. Kaylee, it was this Congress that passed the data center bill. They actually got it done >> and it was an overwhelming vote as it turned out in an effort >> to control the impact on people’s utility bills. But if you remember this thing doesn’t really take effect for 2 years and it’s not going to do much between now and November. >> Yeah, it may be more signal than anything trying to show voters that lawmakers are serious about making sure that there aren’t detrimental effects on communities due to data centers. while the House passed this with a massive

09:44 bipartisan margin if and when it passes the Senate uh on what timeline uh is another question and again the timeline for it to actually have an impact uh is an open one too but we are starting to hear consistently from lawmakers of both parties that if you want to have data centers built you have to do it in a way in which it’s beneficial to communities they bring their own water they bring their own power this seems to be what everyone is coalesing around by and >> that’s true which was not the way it went when data centers started popping up out of the earth you’re from Virginia. I live in Virginia, the data center capital of the world. We’ve learned a lot over the past uh many

10:17 years on this, but this has become a huge issue. And there’s a slightly more clever solution uh that didn’t come from Washington that we want to talk to you about and it involves a company called Emerald AI and two that you may have heard of, Nvidia and Google. I’m glad to say that we’re joined right now by the CEO and founder of Emerald AI, Verun Sever, who’s with us right now in our studio in Washington. and Veroon, thank you for joining us here on Bloomberg TV and radio. >> Joe, Kaylee, thanks for having me. >> So, we’ve illustrated the problem. I want to hear how you’ve managed to solve

10:49 it because it’s a more nuanced approach than what we have heard from lawmakers and regulators here in Washington. >> Exactly. Emerald AI, which we founded under two years ago, aims to transform AI data centers into flexible allies of the power grid. And the reason this works is if an AI data center can reduce its power consumption during those moments when the grid is really stressed out, a hot summer day in Phoenix, Arizona, let’s say, >> then that data center can actually fit onto the existing power grid without

11:20 having to build out expensive infrastructure that can have the effect of raising rates. In fact, flexible AI data centers, all else equal, can help to keep rates low and affordable for local communities. And they can help to keep grids reliable, all while helping America gain a technological edge in the race for AI innovation as we get more data centers connected on the grid. So, it’s a win-winwin thanks to this technology of flexibility when you need it. >> Well, what gives though if you have to have flexibility? If there are moments at which the grid is strained and they

11:53 have to bring it down, I would imagine that that means that you aren’t necessarily powering all the compute you would be otherwise. >> There are many ways to get flexibility. I’ll give you some examples. Our company, Emerald AI, has worked with giants like Nvidia to enable a data center to slow down some of the computations that it’s running. You might have a fine-tuning job that you can slow down or pause or you can take a job and move it at the speed of light from one location to another. So Kaylee, you’re talking to Chat GPT and suddenly you’re getting your answer not from Virginia but from Chicago as we’ve demonstrated at two different Oracle data centers on NVIDIA chips. In addition, you could run a battery that

12:26 happens to be located on site. There are many ways to achieve this flexibility, but the the goal is there’s actually a lot of power on today’s power grid that we just can’t utilize because today data centers require the use of power potentially 24/7. If they’re able to be flexible and what we call good citizens on the power grid, well, they can use a 100 gigawatts that we otherwise can’t use on the power grid today and that helps with the affordability concerns and with the speed to power. >> This sounds really smart, Verun, but

12:56 what about all of the existing data centers? Do you have to retrofit all of them to be part of this new model or is this simply about the next generation? Well, so the way that Emerald AI works is we work both with existing data centers and with new data centers. We are, you know, Nvidia is a big partner and investor in Emerald as are 12 other Fortune 500 global companies. >> And together with them, we have models where for an existing data center, our software, the Emerald Conductor Platform, can help an [clears throat] existing data center change how it consumes energy. And we’re building a

13:29 new data center with Nvidia and digital realy the world’s first from the ground up power flexible AI data center AI factory. It’s 100 megawatts in Manasses Virginia and it comes online later this year. So new data centers can get faster connections to the grid. Think of a fast lane and existing data centers can get even more power much more quickly. >> It’s interesting Kaylee because we talk so much about taking data centers off the grid was behind the meter. Now we need them on the grid. Well, and I’ve actually spoke to the chair of FK about this and and and the ways in which the grid uh needs to adapt to all of this.

14:00 Are you in conversations with regulators? I just wonder what your com you’ve talked about the partnership with Nvidia and others on the industry side, but what have your conversations on the government side? >> Yeah, absolutely. We think that there is a grand bargain to be had where if data centers can work with regulators and the energy industry and say look, you can actually have it all. You can have more data centers, more innovation, you can have lower rates for communities, and you can have more reliable grids. There’s a grand bargain to be had. Let’s connect these flexible data centers faster. That’s why this week we’re so proud to have launched the AI Energy

14:33 Management Alliance. Emerald, Google, and Nvidia are the founding members of the AEMA, this alliance. And we’re joined by a cohort of 20 launch partners, Anthropic, leading AI lab and analog devices, leading semiconductor firm, and leading energy companies, AES, NRG, Constellation, RWE, National Grid, and together we’re presenting a unified front. You mentioned FK, Kaylee. We’re talking to the FK [snorts] commissioners. We’re talking to state regulators. We’re talking to the administration to say, here’s this grand bargain. Let’s make sure that AI data centers can be good citizens, good

15:07 citizens to grids, good citizens to communities, and in return, they should get faster and larger connections to the power grid. >> What do you make of some of the AI stories that we woke up to today? I know this isn’t data center related, but you’ve been in this industry since it really started to kick up. I met you at the NVIDIA conference here about a year ago in Washington DC. We weren’t talking about stories like these about anthropic for instance, self-learning. Claude is doing 26% of its own research and development. Claude is also hacking chat GPT. How do we control this technology?

15:40 >> Well, Joe, as you know, the reason I got into this business to begin with is because I think energy has now become the defining issue for the AI revolution. Um, if you look at China for example, China has plenty of energy. By 2030, they’re going to have 400 gawatt of spare capacity for AI. The United States, however, does not. We want to connect 70 gigawatts of AI data centers over the next two years between now and 2028. We can only really plug in 30. >> But do you worry about AI security interfering with the work that you’re trying to do on the energy side? People are changing their opinions as we’re

16:13 having this conversation. >> Well, look, it is absolutely critical that if the United States is going to compete, we’re going to need data centers here in this country. >> And those data centers, we want to make sure through this new alliance and through Emerald AI’s work, we want to make sure that those data centers are good citizens. the communities that host them deserve as much. If you’re a community and you’ve got a data center coming to town, you want to be sure, hey, that data center is going to bend over backwards so that I don’t have blackouts. I don’t have reliability issues and my bills can stay affordable because if not, we start to face

16:46 trade-offs. Data centers could come to town and you might say, well, do I have the space on the grid to also bring in advanced manufacturing or hospitals or neighborhood energy growth? Now with flexible AI data centers, you can have it all. And that’s now not just Emerald AI saying this. It’s now 20 leading companies bringing the same unified message of this grand bargain to regulators across the country. >> Can I just ask as as one of the stories Joe’s referring to is that AI is improving upon itself without necessarily human direction. How much of this flexibility would be driven by

17:18 automated decision-making? Slow down here, send it there. like is the technology that is actually being powered by these data centers also factoring into the way in which they are flexible? >> It’s such a great question. How do we make these new devices, these large data centers, how do we make them flexible? I first want to say this is not science fiction. This is actually proven. You know, Google, one of the founding members of this new alliance, has done a gigawatt of demand response for its data centers. Emerald and Nvidia have now done six demonstrations around the world in London, uh in Phoenix and Virginia. And we now have, as I mentioned, this

17:51 100 megawatt facility coming online that can flex. I’ll give you an example. >> But are humans directing the flexction? >> Great question. I’ll give you an example. In London, it turns out at halftime of the soccer game, everybody watches in Britain these soccer games, football they call it, and everyone turns on they turn on their tea kettles at halftime, right? And so there’s a spike of a gigawatt of power onto the grid at that moment. >> Now, in that moment, or you know, a lightning strike hits the grid and takes out a substation or a line. In that moment, no human can act quickly enough in order to modulate the power in that data center. And so what we

18:23 demonstrated, Emerald with Nvidia and the local utility national grid, we demonstrated that data center was able to autonomously reduce its power consumption, but do it in a very special way. Do it in a way where the computations, the AI computations, >> wow, >> would continue to run, the mission critical computations continue to run at the right performance level. And so we protected the AI. We protected the grid. Rates stay low and communities have resilient electricity. >> We ran out of time to ask you when you’re running for office [laughter] or when you’re going public. Let’s do that next time. >> Joe, thank you for having me. >> Thanks for joining us. Veruniver of

18:56 Emerald AI here with us on Balance of Power on Bloomberg. >> It’s 121 on Wall Street. We do check markets all day long here at Bloomberg. NASDAQ 100 index just turning positive. Little changed. Rest of the market moving lower. The Dow, the S&P, Nasdaq all in the red. Last stretch of a very busy week for markets. Saw stocks falling as bond yields rose. Right now, the S&P stands at 7623. The S&P down by about 2/10en of 1%. Dow industrials down

19:29 210. On the Dow, a decline of 4/10en of 1%. Nasdaq composite down 16. For NASDAQ, a drop now of onetenth of 1%. NASDAQ 100 index, as I mentioned, positive, little changed, up under 1/10enth of 1%. The VIX right around 15. The 2-year 4.74%. 10-year yields hit 5% on bets that elevated energy costs could fuel inflation, prompting further Federal Reserve rate hikes. Right now, 10ear is at 5.0% with the 30-year 5.33%.

20:03 Gold up $42 the ounce to 43.84 up by 1%. Crude down 1.2%. West Texas Intermediate $10071 a barrel on WTI Brent 10358 down now by 1.2%. Bitcoin major move there up 5.5%. Bitcoin 80,718. on holding has signed French superstar Killian Mbappé as a partner in developing football products and representing the brand mounting a bold

20:34 challenge to Nike and Adidas. Dominance of the sport on holdings up by 1.3%. Nike shares trading lower now we’ve got Nike down by 1.6%. For on demand news 24 hours a day, subscribe to Bloomberg News now wherever you get your podcast. I’m Charlie Pellet, Joe and Kaylee. That’s a Bloomberg business flash. >> All right, Charlie Pellet in New York checking on the markets for us. Thank you so much. I’m Kaylee Lines alongside Joe Matthew in Washington where we have spent all week, all month, the vast majority of this year talking about artificial intelligence and data centers

21:07 and how, if at all, government would like to see it regulated. At the federal level, still an open question as President Trump of course is arguing for one thing and many other uh lawmakers who find themselves on the ballot this year are saying another. At the state level though, we’re seeing a lot of action. Today alone in Virginia, Governor Abigail Spanberger signing an executive order that she says is the most aggressive and comprehensive data center accountability framework in the nation. That hitting about the same time that out in California, Governor Gavin Newsome signs his own EO directing

21:39 actions to address what he describes as dangers of recent AI incidents. Among Newsome’s ideas he would like to see pursued, Joe, >> independent oversight of AI companies. >> Mhm. safety checks and the creation of an AI kill switch. >> There we go again. Seems like that’s inevitable. Everyone’s got an idea on this. And by the way, one of the first, I think, proposals came from California, Ted Lou. >> Maybe he should call the governor. They could work on this together. Of course, John Kennedy in Louisiana has one. There any number of other legislative attempts

22:09 to get their arms around this, but it’s something that we want to talk about with our political panel. Bloomberg politics contributors Rick Davis and Jeannie Shanzeno are with us after our fascinating conversation with Arun. I learned a lot. >> Yeah, >> let’s play it to the panel now. Jeanie is our Democratic analyst, Democracy visiting fellow at Harvard Kennedy School’s Ash Center. Rick is our Republican strategist of course as well partner at Stonecourt Capital. Rick, I’d like to start with you as somebody who works in the investment community here and the pitch that we just heard from Verun on a new approach. Will it be

22:40 industry that solves this with a more clever approach than Washington can seem to come up with? >> Well, first of all, I think that uh Washington has been pretty much checked out. I mean, they they just did pass in the house the uh rateayer protection bill, but that is only a very small effort to try and uh you know create some solutions for especially uh AI uh data centers. But at the end of the day, states and and corporations working together uh are really going to be the way that this gets done because I I

23:12 can’t imagine the f federal government uh unleashing billions of dollars to upgrade the grid all of a sudden, which they’ve been working on for quite some time, creating a new demand response like what Run was talking about that can flex the grid uh around the uh most high uh uh uh you know, use areas, but also uh develop the the energy resources uh that can be spread across the country rather than isolated in their own communities. Uh I I really think this is one where we’re going to have to depend upon uh uh companies and states working

23:44 together. As much as the president would like to have federal control over this, I don’t think that’s the solution. Well, and it’s interesting as Run was talking about the notion of data center flexibility is a data center in Arizona that is facing strain on the grid can instead send the compute need to a data center in Virginia for example. It does seem like this whole idea is something that would cross state lines. So Jeannie, as we consider this notion of it being done on a stateby-state basis, Shapiro does this, Spanberger does this,

24:18 Newsome does this. Is there going to have to be federal alignment at some point? >> You know, I I think eventually, but you know, let’s be honest, when they can’t pass a budget on time, I mean, I don’t think we’re going to see them move forward with all deliberate speed on this. As much as you know we should say that individual senators and you just you and Joe just mentioned some of them and representatives are really devoted to trying to get something done it’s going to be hard we’re going to be hardressed to see that in the near future in DC. So we are relying on the

24:52 states and of course the localities and the private industry and you know that is where the innovation on this is going to come from. You know what should be done um what can be done because the reality is we are not going to see less data use going forward. it is going to be part and parcel of all of our lives. And so we do need reform and investment to address these challenges that we’re facing. And of course, this has just sort of broken through politically. And

25:26 I think that’s what we’re seeing whether it’s out of Shapiro, whether it’s out of Newsome Nome, who by the way, this is a switch from his earlier vote not that long ago on this issue. It’s an about face. Um he did SB 1047 and he got some push back on that where he voted against a mandatory AI kill switch but you know he can read the polls just like you know Governor Dantis, Governor Abbott, you know Steve Bannon, Bernie Sanders, they all know that this is widely unpopular.

25:58 people are concerned and so they are stepping up to address and to try to think about ways and at least show their constituents and potentially 2028 voters that they are on top of this issue. Of course, the problem is one of timing. I mean, I was listening to Mike Shepard talk to you guys about the fact that, you know, how long you set up a panel in a state to think about this. We’re talking, you know, a little while before we see something get done. >> That’s for sure. Um, Rick, you know, we’ve been watching the reaction on Wall

26:30 Street to a lot of these stories, and sometimes investors can get spooked, but we’ve seen AI stocks largely bounce back this week, and I’m wondering uh the extent to which you can tell us what the investment community thinks, not so much retail, Wall Street, not even so much public markets, but but what does private equity think? What does private investment think about this? Are we seeing through the rhetoric? because I keep hearing that Washington doesn’t understand how strong this backlog is and no matter what regulations you put

27:01 on it, the growth may not be affected. How about you? >> Yeah, look, I mean, uh the people I talk to uh who are investors and who have an eye for this um really understand the transformational impact that uh this technology will have on every life on the planet. Uh this is not a US investment. This is not a China investment. This is a global investment. Uh it’s already showing uh uh impacts on productivity across the US workforce. Uh

27:31 and uh and even though a lot of people are talking about the dire uh aspects of uh uh AI growth around the world, it almost points to why this is such an important investment. Because if it’s going to transform the world to the point where you could literally create an extinction model around it, then you have to realize it’s going to change every business in the world. >> Yeah. Well, from the United States to China then perhaps Jeie knowing that

28:02 Xihinping at this time next week will have wrapped up his state visit with President Trump at the White House when Trump has framed this entire conversation around AI as being a competition with China. What do you expect we’re going to see? Will they be talking about this in public? Will they be talking about it in a serious way behind closed doors? I do think they’re going to talk about it. Whether they allow us in, I I wish. I’m not sure about that. Um, but you know, I I think there’s no question. You

28:35 know, Donald Trump has framed this entire conversation as a must-win, no guardrails, limited regulation because we have to win this competition with China. That flies directly in the face of his actions over the last two years as he has made tried to make chips available to China. He has set up data center trade agreements with Saudi Arabia, UAE, both close um business partners with China. So there’s a lot of evidence that we are he and the

29:06 administration are making it easier for China to move faster on AI development. And then on the other hand, he’s telling us we can’t regulate because of China and we’ll lose. which again raises this question what is really behind his insistence anti-regulation but I do think it is going to be fascinating the state dinner the meeting because we are going to see again like we saw at the inauguration at least with the AI executives and the close connection to Donald Trump and of course

29:36 you add their you add into that Xihinping and the Chinese delegation um and I think one big question in my mind is Donald Trump really um really insistent on limiting China’s access to these chips and models and if so why then the actions over the last two years? That’s one of the many questions out of it at all overall. I think we aren’t expecting too too much to change. >> Interesting. It’s going to be a fascinating uh week here in Washington

30:07 watching all this as the president comes back from ANGA. Rick, you probably heard the president of the United States is meeting Xihinping at Andrews uh for the first time. He’s never gone to the airport to to greet a dignitary like this. Jensen Wong uh presumably in the leather jacket and tie is going to be at the state dinner along with Sam Alman. Uh what do you expect to come from this summit, if anything, whether it’s involving trade or AI? Yeah, it’s it’s not clear what the administration’s goals are uh to uh to

30:40 accomplish this. And of course, we know what Chief’s goals are, right? He wants to look important on a global stage. He’s getting the necessary uh support from Donald Trump to do that. And and so, uh like the greeting at the airport, I mean, that puts she on a Whoops. Ah, shoot. >> Oh, boy. We got you still, Rick. No, no, keep going. We hear you. >> Oh, okay. I’m sorry. I’ve got all kinds of things [laughter] going on over here. Um but but like we’ve elevated Chi just by having this this summit and and hosting him as an equal almost to the president of the United States. On the

31:12 other hand um uh Chi doesn’t want anything to come out of this. He wants to be able to use our models to build his own. He wants to be able to get more chips. Uh, and I would say that’s really the core thing is is Trump going to, you know, crack down on export controls on the chips because China needs that to stay in pace with us on AI and and we have the ability to use that for our own capability. So I think it’s much less to do with like how do you slow down the pace of AI and how do you in instead how do you manage the you know really

31:44 important aspect of this which is control these chips. >> Indeed. Rick Davis and Jeannie Shanzeno Bloomberg politics contributors the both of them in our political panel on this Friday. Thank you so much. As you said, Joe, this is going to be a big one next week. This summit between Trump and she, and we’re going to see visuals, frankly, from it of the likes we haven’t really seen before, whether it’s greeting the plane uh at Andrews or the state dinner with all of these tech executives and other executives uh coming to the White House for it. >> Maybe a marching band on the tarmac,

32:16 maybe. >> We’ll have to see. Uh you love live broadcasting, right? Rick Davis and Jeannie Shanzeno. Thank you both. Much more to follow here on Balance of Power. It’s the Friday edition alongside Kaylee Lines. I’m Joe Matthew. Only available on Bloomberg TV and radio. It’s 140 on Wall Street. We do check markets all day long here at Bloomberg. We begin with a developing story headline right off the Bloomberg Professional Service. Westinghouse Electric is seeking a valuation of more

32:48 than $50 billion in a US IPO. This according to sources, Westinghouse Electric is a provider of reactor technology to nuclear power plants. But again, the story right now on the Bloomberg Westinghouse said to target over 50 billion valuation in a US IPO. The Dow, the S&P, NASDAQ [music] all trading lower. NASDAQ 100 index holding on to a gain of 19 points right now, up by about onetenth of 1%. We’re in the final stretch of a very busy week for

33:19 markets, including a Fed decision. S&P right now down 10 to 7626. That is a drop of onetenth of 1%. Dow industrials down 188 on the Dow a decline of 4/10en of 1%. NASDAQ little change lower by undertenth of 1%. All of this with the socks. The Philadelphia semiconductor index up 1.1%. The VIX right around 15. The 2-year 4.73%. The 10-year bouncing around 4.99%

33:49 right now. and a 30-year currently yielding 4.33%. Gold at 4393 the ounce. Spot gold up 1.2%. West Texas Intermediate crude down 1.1%. $10083 a barrel on WTI. Barrel of Brent 10371 down now by 1%. Bitcoin major move there to the upside. Bitcoin right now trading higher. We’ve got Bitcoin up by just about 5 1.5%. Bitcoin right now uh is [music] advancing to $80,600.

34:22 So again recapping here and repeating the earlier headline, Westinghouse Electric said to target over a $50 billion valuation in a US IPO. For on demand news 24 hours a day, subscribe to Bloomberg News now wherever you get your podcast. I’m Charlie Pellet and that is a Bloomberg business flash. Gold Westinghouse Electric. Charlie, thank you so much. Charlie Pellet, the voice of Wall Street shall return at 2 PM with another read on the Friday trade as we uh welcome Bloomberg Business Week Daily to the airwaves. Thanks for

34:55 joining us here on the Friday edition of Balance of Power. I’m Joe Matthew indeed alongside Kaylee Lines. With uh 46 days, I believe without looking. Is that right? 46 days to the midterm elections and the polls are starting to count. We are now officially beyond primary season and we’re looking squarely at some very important general elections that will decide the balance of power. I said it on Capitol Hill and some fascinating numbers today, Kaylee, whether you’re looking at this poll in Kentucky with a Democrat leading uh an incumbent or I

35:27 should say not Kentucky but Kansas rather. We’ll get to Kentucky in a moment. Uh Roger Marshall, the Republican from Kansas, being led by a Democrat at this point is remarkable in a state that red. We’re also watching Michigan with new numbers from the Washington Post suggesting that the president’s tariff regime with Canada is in fact not only frowned upon by Democrats, but a majority of Republicans and a vast majority of independents. You put these all together, Kaylee, you start wondering if the Senate is in fact in play. >> Yeah, Democrats certainly believe that

35:59 it is. and the likes of Senate Minority Leader Chuck Schumer have been saying that the map may be wider than even just the states we all spend so much time taking about of talking and thinking about taking a look at states like Kansas where the incumbent Roger Marshall does look like he might be in a little bit of trouble according to this Emerson poll. So let’s get into it now as we turn to Bill Far’s Bloomberg News senior editor who is leading our midterms coverage. Bill, when we consider [snorts] Kansas, which isn’t necessarily one of the six or seven states that we’ve been following most closely and where we expect the vast majority of resources to be deployed,

36:32 does a poll like this change things? How much money are Debs funneling to Kansas right now? >> Well, is it’s definitely a big alarm for Republicans. I mean, even three or three months ago or so, if you said that uh Republicans would be having to spend money and and campaign time and even sending the vice president to Kansas, uh you wouldn’t have been really taken all that seriously. But it is it is an interesting uh look at the impact that some of President Trump’s policies have had. Uh diesel prices are obviously a huge issue in that part of the country. Uh and there was, you know, a New York

37:05 Times report about Roger Marshall’s lawsuits against some of his former patients uh when he was working full-time as a physician that hurt him. But it is just kind of a broader sign of the times that uh as we get closer to the election, uh we are starting to see the map widen really for both parties, but mostly for uh for the Democrats in this cycle. I mean, listen, this Kansas seat, Roger Marshall, that’s been in Republican hands since the 1930s. So, this is a this is a big shock for a lot of people in politics and you’re seeing

37:36 money move in there. You’re seeing uh GOP leaders starting to talk about having to campaign there. >> 1932, according to Spencer Kimell at Emerson College uh running that poll and it it’s on the heels of the poll that we saw in Texas with James Terrio running ahead of Ken Paxton. Bill, the president, the United States has pledged to travel for 30 to 35 different campaign stops over the course of October. He was out in North Carolina earlier this week. Could he potentially turn these numbers around?

38:09 >> Well, in some of those races, I think that you have candidates who don’t want to be too closely aligned with the MAGA brand at this point. Uh we do know that, you know, Vice President Vance is going to be in Iowa, uh trying to rally Republicans there. Um but the uh their Senate candidate Ashley Henson is staying away from that rally and and just said you know she has conflicts in her schedule but it’s a really telling sign uh that in some cases you see more push back. We saw Florida Congresswoman Republican Congresswoman Maria Alvarez

38:40 Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Sal Salazar yesterday uh hitting the president directly on immigration policy. So uh you are seeing there are certainly places where President Trump and uh has a very strong grip over his party. He’s shown that throughout the primaries, but it’s not everywhere and it’s not everywhere Republicans need to win. So, there is going to be an interesting look in the final homestretch of this campaign about where he’s going, how much he really is traveling. It remains to be seen if he’ll really keep that schedule. Uh, and maybe places where he’s not traveling,

39:10 where Republicans still need some help. >> Well, and as we consider everything the president’s trying to do, it’s not just campaigning on behalf of candidates. He obviously has tried with limited success to uh change in which the way mail and ballots are sent out. Obviously the Supreme Court ruling against him on that one. He’s trying to get greater access to uh social security information uh for the purposes of cross-checking citizenship with uh voter roles bill. Are we getting to the point where it’s too late for any of those efforts even if they were to be successful uh to be implemented? I aren’t people able to

39:42 early vote in a number of states effective today or in the days to come? Yeah, I mean people are voting. You can you can walk in for early vote in Virginia, I believe, either today or tomorrow. Uh by uh this time next week, almost half the country will be receiving mail and ballots. And we know that some ballots are already being uh sent back in. So the election is effectively underway. The big advantage the Republicans have, of course, is financial. Uh MAGA Inc. with about $400 million. You have people like Elon Musk

40:13 willing to help support Republican efforts. So, uh, we’re going to see. This is going to be a great test case for whether voters have truly made up their minds now about 6 weeks out or if they can be persuaded, uh, to vote Republican or, uh, go to the polls instead of staying home. Uh, I think there’s going to be a barrage of text messages and ads hitting anyone in uh, in any kind of swing state or anything close to a swing state over the next several weeks. >> Right, Bill. Thank you. Bill F’s Bloomberg News senior editor with us on the campaign trail and we’re going to

40:46 stay on the midterm campaign trail as I mentioned in my reference to Kentucky with someone who is kneedeep in it right now. Democratic Senate nominee Charles Booker is running us uh with us running uh against Andy Bar in Kucky’s open Senate race. It’s great to see you. Welcome to Bloomberg TV and radio. Do you have the backing of Democratic leadership here in Washington? Is the DSCC putting money in Kentucky? Well, the momentum is picking up because something different is happening in Kentucky. A lot of people are frustrated with what’s going on, the status quo, the rising prices, the inflation, the

41:20 tariffs that are breaking the backs of Kuckians, and our campaign is showing the power of a coalition that national folks are taking note of, including uh in the party. So, I’m inspired because recent polling has showed that when our message gets out there, we’re tied in the polls. We have a real chance to win this race and flip the US Senate. Well, do you need potentially an influx of national party money to get the message out there? Have they committed to spending money on your behalf for ads and such? >> Well, I know those conversations are ongoing and we’re we’re doing well now and our support is growing. >> Are you having them here in Washington

41:51 this week? >> Uh, absolutely. Absolutely. And and I’m excited about it because this is a story of regular people fighting back in Kentucky and the fact that our allies nationally are taking note and realizing that this is a state to invest in is important. Um because the fact of the matter is in Kentucky, Mitch McConnell has hurt so many people. His unfavorables, he’s over 80%. And Trump is losing ground. He’s underwater, too. So, the pathway to victory is clear. If you listen to the people and with the resources, we can win this race. >> Well, imagine being side by side with

42:21 Mitch McConnell as the junior senator in Kentucky. Would you be able to uh uh to work together with someone like that if he were to stay around? Obviously, this is an open seat, but this is the man Kentucky has been voting for. What makes you think they’re ready for such a change? >> Well, Mitch McConnell’s been in office my entire life. I was two weeks old when he was elected, and a lot of people in Kentucky are really tired of the way he sold us out. There was a time when he delivered resources to Kentucky, invested in the Commonwealth, but he turned his back on us, and that’s why so many people despise him now, and that’s why he’s underwater over 80%. And so our

42:55 path to victory is a lot of taking notes from him, investing in infrastructure, but telling the people that this is for them. This seat belongs to them. And because of that, we are in a position to win. >> Well, of course, Senator McConnell just returned to the Senate after a period of of months of recovery from a fall and and the health issue itself aside, do you feel like his absence backfired at home? Has that changed voter sentiment? Are you feeling that on the ground? You know, I think it lit a sense of urgency in a lot of people who were already frustrated with the status quo that says they don’t matter. Mitch McConnell was essentially a no- call no-show for over

43:28 90 days. And any regular person who was away from their job, no call, no show for that long, they wouldn’t have a job. And the the disregard as well as using his career to work against paid sick leave, to work against the same health care that he’s been getting, it’s really pissed a lot of Kuckians off. And the fact of the matter is by showing that we can stand up against corruption. We can stand up to McConnell and his protege in Andy Bar who is just as corrupt, has sold out to Wall Street, has essentially given a blank check to endless war and

43:59 is fine with these tariffs, breaking the backs of working people, that we can send a fighter to Washington who really cares, who is determined to fight for every Kuckian, Democrat, Republican, and independent. >> He’s 84 years old. uh the images of his return to Washington uh sparked a whole new conversation about should there be a mandatory retirement age when it comes to elected federal office. Rahm Emanuel, for instance, is running on a mandatory 75year-old retirement age. Would you support such a thing? Would you propose it? >> Well, first of all, Mitch McConnell

44:31 needs to step down. >> Well, you’ve made that clear. >> That’s abundant. >> Whether I mean, you say people despise him whether they love him or not. Should an 84 year old hold office? Well, you know, I think it’s less about age and more about the ability to do the job. Uh, and the fact of the matter is we do need to have that conversation. I’ve called for term limits. I do think a very real conversation about um age and and capability is important because at this point, Mitch McConnell is being wheeled into the chambers and it’s clear he doesn’t have a grasp on everything that’s going on. So, with these big issues impacting our farmers, impacting

45:02 businesses, impacting working people, we need a leader who is competent and able to represent them. What about the leader of the Democratic caucus in the Senate? If he were to join it, would you support Chuck Schumer staying on as a majority leader in that scenario? >> Well, I look forward to getting to the Senate and making a very clear decision on how we best represent the future for Kentucky, how we stand for our values, and make sure that we’re continuing to win because Kuckians are genuinely hurting. And anyone who is looking to work for Kentucky is going to find an ally in me.

45:32 >> The next couple of weeks are going to be interesting. How do you break through in a state like Kentucky that is about as bright red as you get? >> You know what? In a lot of ways, we’ve broken through on the ground. That’s why people who voted for Trump are organizing with me. >> Do you have to break through outside of the cities? Are you talking to farmers? Are you going into rural areas or is this race decided in Louisville? >> Oh, we’re going everywhere. Uh and of course in our um main urban areas, Louisville, Lexington, Northern Kentucky, of course, we’re doing a lot of work, but I’ve launched an initiative called Hood to the Holler. We’re going to the communities that people have ignored, have felt exploited, and

46:04 forgotten about, Republicans and Democrats alike. We’re building a historic coalition that speaks to the history of the Rainbow Coalition, and that’s why we’re in a position to win this race. >> Well, and so get to some of the issues as you talk about improving the life of Kuckians uh in the US Senate. What does that actually look like? Take healthcare for example. You have candidates who are suggesting Medicare for all is the most viable solve uh to make sure that everyone has access to healthcare. Is that where where you stand? Is there another legislative way you think it’s best approached? >> Well, you know, I’ve talked a lot about my health. I’m a type 1 diabetic and I’ve had to ration my insulin to feed my

46:37 daughters. And I know a lot of Kuckians know that story because needing that insulin is not a Democrat or Republican issue. It’s a human issue. And the fact that we are talking about healthcare and honoring as a right has allowed us to build a lot of support. And I’ve been on the record for Medicare for all for years. And I know a lot of Kuckians have been talking about the need for public option. And I know that there is growing momentum to move us closer to that goal of making sure that everyone has healthcare so no one’s choosing between the medicine they need or keeping the lights on. >> We have a little bit less than a minute. If you were elected, would you pledge to

47:09 reach across the aisle, work with Rand Paul? >> Well, I’ve been commending Rand Paul for calling for accountability on endless wars and with the Epstein files as well. Anyone that’s willing to work for the people of Kentucky is going to find a partner in me and I’ll work across the aisle. I’ll do whatever it takes to deliver for my family in Kentucky. All right, we will leave it there. The Democratic Senate nominee in Kentucky, Charles Booker, here with us in our Washington Du studio. Thank you so much and stay in touch. And we should note we have invited his opponent as well, the Republican nominee, current congressman from Kentucky, Andy Bar [music] on the

47:40 program, too. That’ll do it for the early edition, but Joe, we’ll be back for more 5:00 p.m. Eastern time. Join us on the late edition of Balance of Power as we look ahead to the United Nations General Assembly and President Trump’s summit with President Xi. Only here on bird.