And Google’s boss has weighed in on the AI boom.
Mohammed bin Salman.
Happy Wednesday and welcome to your morning wrap of the latest political and business news from around the world.
First up, US President Donald Trump is hosting Crown Prince Mohammed bin Salman at the White House, as the Saudi de facto leader seeks to further rehabilitate his global image after the 2018 killing of US-based journalist Jamal Khashoggi, Reuters reported.
US intelligence concluded that bin Salman approved the capture of Khashoggi at the Saudi consulate in Istanbul. Although he has denied ordering the operation, he has acknowledged responsibility as the kingdom’s crown ruler.
Bin Salman was greeted with pomp and ceremony on his first visit to the White House in seven years.
At a press briefing this morning, Trump said that Saudi Arabia would invest US$600 billion ($1.06 trillion) in the US, which was a reference to funds promised during the president’s trip to Riyadh earlier this year, with the Crown Prince later saying this could increase up to $1 trillion, the BBC reported.
Trump said earlier this week that the US would be selling F-35 fighter jets to the Saudis, which would be the first sale of such aircraft to the country and mark a significant policy shift. It could alter the military balance in the Middle East and test Washington’s commitment to maintaining Israel’s military edge in the region.
Israel is the only country in the Middle East with F-35s. Beyond military equipment, bin Salman is also seeking new security guarantees.
Mohammed bin Salman.
In business news, Google’s boss told the BBC in a sit-down interview that every company would be affected if the AI bubble were to burst, and that there were “elements of irrationality” to the current boom.
Sundar Pichai, when asked if Google would be immune to the AI bubble bursting, issued a warning: "I think no company is going to be immune, including us," he said.
Pichai said Google’s model of owning its own "full stack" of technologies, from chips to YouTube data, to models and frontier science, meant it was in a better position to ride out any AI market turbulence.
On growing concerns about soaring valuations and how the current AI boom could be mirroring the dot-com bubble of the late 1990s, Pichai said it was possible for the industry to “overshoot” such investments.
"We can look back at the internet right now. There was clearly a lot of excess investment, but none of us would question whether the internet was profound," he said. "I expect AI to be the same. So, I think it's both rational and there are elements of irrationality through a moment like this."
Sundar Pichai.
Staying with AI, tech giant Microsoft has announced a new strategic partnership with Nvidia and the startup Anthropic, CNBC reported.
The deal will see Microsoft and Nvidia invest up to US$15b in Anthropic. The investments have pushed the startup's valuation to about US$350b, according to a source close to the deal.
Anthropic was founded by former OpenAI research executives in 2021 and is best known for developing a family of large language models called Claude. As part of today’s deal, Anthropic has agreed to purchase $30b of computing capacity from Microsoft and to contract additional capacity up to one gigawatt.
To Poland, where officials have pointed the finger at Russia after a key train track was destroyed in what Warsaw said was an “unprecedented act of sabotage” committed by two Ukrainian citizens who were working with Russia, CNN reported.
Polish Prime Minister Donald Tusk said the two perpetrators, who have since fled to Belarus, were identified by the country’s security agency.
He said earlier this week that the track between the Polish cities of Warsaw and Lublin was destroyed after an explosive device blew it up. “The established perpetrators are two Ukrainian citizens who have been collaborating with Russian services for some time. Their identities are known,” he said.
The Kremlin has rejected Tusk’s claim of Russian collusion, saying the allegation is based on “Russophobia”.
Polish Prime Minister Donald Tusk.
Finally, in market news, the price of Bitcoin slid below US$90,000 overnight for the first time in seven months, Reuters reported.
The world’s largest cryptocurrency has lost all its gains this year and is down nearly 30% from its peak of $126,000 in October. About $1.2 trillion has been wiped off the total market value of all cryptocurrencies in the past six weeks, according to market tracker CoinGecko.
Doubts about the outlook for US interest rate cuts and concerns in equity markets, which have begun to wobble after a long rally, are believed to be weighing down the crypto market.
"The cascading selloff is amplified by listed companies and institutions exiting their positions after piling in during the rally, compounding contagion risks across the market," Hong Kong Web3 Association co-chair Joshua Chu said.
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