India's Modi to Meet China's Xi Amid US Tariff Tensions
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
8 minutes ago
- Yahoo
China Urges Firms to Avoid Nvidia H20 Chips After Trump Resumes Sales
(Bloomberg) -- Beijing has urged local companies to avoid using Nvidia Corp.'s H20 processors, particularly for government-related purposes, complicating the chipmaker's return to China after the Trump administration reversed an effective US ban on such sales. Sunseeking Germans Face Swiss Backlash Over Alpine Holiday Congestion New York Warns of $34 Billion Budget Hole, Biggest Since 2009 Crisis To Head Off Severe Storm Surges, Nova Scotia Invests in 'Living Shorelines' Five Years After Black Lives Matter, Brussels' Colonial Statues Remain A New Stage for the Theater That Gave America Shakespeare in the Park Over the past few weeks, Chinese authorities have sent notices to a range of firms discouraging use of the less-advanced semiconductors, people familiar with the matter said. The guidance was particularly strong against the use of H20s for any government or national security-related work by state enterprises or private companies, said the people, who asked not to be identified because the information is sensitive. The letters didn't, however, constitute an outright ban on H20 use, according to the people. Industry analysts broadly agree that Chinese companies still covet those chips, which perform quite well in certain crucial AI applications. President Donald Trump said Monday that the processor 'still has a market' in the Asian country despite also calling it 'obsolete.' Nvidia and Advanced Micro Devices Inc. both recently secured Washington's approval to resume lower-end AI chip sales to China, on the controversial and legally questionable condition that they give the US government a 15% cut of the related revenue. But even with Trump's team on board, the two companies face the challenge that their Chinese customers are under Beijing's pressure to purchase domestic chips instead. Beijing's overall push affects AI accelerators from AMD in addition to Nvidia, one of the people said, though it's unclear whether any letters specifically mentioned AMD's MI308 chip. Shares of Chinese AI chip designer Cambricon Technologies Corp. surged to their daily limit of 20% on the news of China's guidance, leading a rally in peers such as Semiconductor Manufacturing International Corp. Beijing's stance could limit Trump's ability to turn his export control about-face into a windfall for government coffers, a deal that highlighted his administration's transactional approach to national security policies long treated as nonnegotiable. Still, Chinese companies may not be ready to jump ship to local semiconductors. 'Chips from domestic manufacturers are improving dramatically in quality, but they might not be as versatile for specific workloads that China's domestic AI industry hopes to focus on,' said Homin Lee, a senior macro strategist at Lombard Odier in Singapore. Lee added that he anticipates 'strong' demand for the chips the Trump administration is allowing Nvidia and AMD to sell. Rosenblatt Securities analyst Kevin Cassidy said he doesn't anticipate that Nvidia's processor sales to China will be affected because 'Chinese companies are going to want to use the best chips available.' Nvidia and AMD's chips are superior to local alternatives, he said. Beijing asked companies about that issue in some of its letters, according to one of the people, posing questions such as why they buy Nvidia H20 chips over local versions, whether that's a necessary choice given domestic options, and whether they've found any security concerns in the Nvidia hardware. The notices coincide with state media reports that cast doubt on the security and reliability of H20 processors. Chinese regulators have raised those concerns directly with Nvidia, which has repeatedly denied that its chips contain such vulnerabilities. The Financial Times reported that some Chinese companies are planning to decrease orders of Nvidia chips in response to the letters. Right now, the people said, China's most stringent chip guidance is limited to sensitive applications, a situation that bears similarities to the way Beijing restricted Tesla Inc. vehicles and Apple Inc. iPhones in certain institutions and locations over security concerns. China's government also at one point barred the use of Micron Technology Inc. chips in critical infrastructure. It's possible that Beijing may extend its heavier-handed Nvidia and AMD guidance to a wider range of settings, according to one person with direct knowledge of the deliberations, who said that those conversations are in early stages. AMD declined to comment on Beijing's notices, while Nvidia said in a statement that 'the H20 is not a military product or for government infrastructure.' China has ample supplies of domestic chips, Nvidia said, and 'won't and never has relied on American chips for government operations.' China's Ministry of Industry and Information Technology and the Cyberspace Administration of China didn't respond to faxed requests for comment on this story, which is based on interviews with more than a half-dozen people familiar with Beijing's policy discussions. The White House didn't respond to a request for comment. The Chinese government's posture raises questions about the Trump administration's explanation for why the US is allowing those exports mere months after effectively banning such sales. Multiple senior US officials have said their policy reversal was the result of trade talks with China, but Beijing has publicly indicated that the resumed H20 shipments weren't part of any bilateral deal. China's recent notices to companies suggest that the Asian country may not have sought such a concession from Washington in the first place. Beijing's concerns are twofold. For starters, Chinese officials are worried that Nvidia chips could have location-tracking and remote-shutdown capabilities — a suggestion that Nvidia has vehemently denied. Trump officials are actively exploring whether location tracking could be used to help curtail suspected smuggling of restricted components into China, and lawmakers have introduced a bill that would require location verification for advanced AI chips. Second, Beijing is intensely focused on developing its domestic chip capabilities, and wants Chinese companies to shift away from Western chips in favor of local offerings. Officials have previously urged Chinese firms to choose domestic semiconductors over Nvidia H20 processors, Bloomberg reported last September, and have introduced energy efficiency standards that the H20 chip doesn't meet. Nvidia designed the H20 chip specifically for Chinese customers to abide by years of US restrictions on sales of its more advanced hardware, curbs designed to limit Beijing's access to AI that could benefit the Chinese military. The H20 chip has less computational power than Nvidia's top offerings, but its strong memory bandwidth is quite well suited to the inference stage of AI development, when models recognize patterns and draw conclusions. That's made it a desirable product to companies like Alibaba Group Holding Ltd. and Tencent Holdings Ltd. in China, where domestic chip champion Huawei Technologies Co. is struggling to produce enough advanced components to meet market demand. By one estimate from Biden officials — who considered but did not implement controls on H20 sales — losing access to that Nvidia chip would make it three to six times more expensive for Chinese companies to run inference on advanced AI models. 'Beijing appears to be using regulatory uncertainty to create a captive market sufficiently sized to absorb Huawei's supply, while still allowing purchases of H20s to meet actual demands,' said Lennart Heim, an AI-focused researcher at RAND, of China's push for companies to avoid American AI chips. 'This signals that domestic alternatives remain inadequate even as China pressures foreign suppliers.' In his remarks Monday, Trump said China's Huawei already offers chips comparable to the Nvidia H20, echoing previous remarks by officials in his administration who've defended the decision to resume H20 exports partly on those grounds. The US should keep the Chinese AI ecosystem reliant on less-advanced American technology for as long as possible, these officials say, in order to deprive Huawei of the revenue and know-how that would come from a broader customer base. Other administration officials have strongly objected to that logic, Bloomberg has reported, arguing that resuming H20 exports will only embolden China's tech champions and bolster the country's overall computing power. Commerce Secretary Howard Lutnick and other Trump officials have also claimed that the H20 move was part of a deal to improve American access to Chinese rare-earth minerals — despite the Trump team's previous assertions that such an arrangement wasn't on the table. 'As the Chinese deliver their magnets, then the H20s will come off,' Lutnick said last month. Treasury Secretary Scott Bessent said in late July that the magnet issue had been 'solved.' The first Nvidia H20 and AMD MI308 licenses arrived a bit over a week after Bessent's declaration — after Nvidia Chief Executive Officer Jensen Huang met with the president and both companies agreed to share their China revenue with the US government. --With assistance from Yanping Li, Sangmi Cha and Emily Forgash. (Updates with additional analyst commentary in ninth paragraph.) Why It's Actually a Good Time to Buy a House, According to a Zillow Economist Bessent on Tariffs, Deficits and Embracing Trump's Economic Plan The Social Media Trend Machine Is Spitting Out Weirder and Weirder Results The Game Starts at 8. The Robbery Starts at 8:01 Klarna Cashed In on 'Buy Now, Pay Later.' Now It Wants to Be a Bank ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CBS News
8 minutes ago
- CBS News
Are annuities a safe investment this August? 5 things to know now
As inflationary pressures continue to impact household budgets and volatility persists within the financial markets, many seniors, retirees and soon-to-be retirees are looking for ways to safeguard their nest eggs. And, while there are any number of ways to do that, annuities have long been used to guarantee that retirees have a predictable income stream after they stop working. But while annuities are considered a reliable way to ensure financial security in retirement, the economic landscape we're facing currently brings with it new considerations. After all, today's issues with high interest rates, inflation and stock market volatility could influence how safe an annuity truly is as an investment. Understanding these dynamics is crucial for anyone considering annuities, whether they're seeking guaranteed income, tax-deferred growth or just peace of mind in terms of market risk. So, with economic uncertainty swirling, is this really the right time to consider an annuity? That's what we'll analyze below. Find out how to add an annuity to your retirement portfolio today. When evaluating annuity safety, you're essentially asking two questions: Will the insurance company be around to make good on its promises, and will those promises actually protect your purchasing power over time? With that in mind, here are a few important things you should know about the safety of annuities right now: Unlike bank deposits, annuities aren't backed by the Federal Deposit Insurance Corporation (FDIC). Your safety instead relies entirely on the financial stability of the insurance company issuing the contract. This makes it critical to research the insurer's credit and customer service ratings. As you consider your options, look for companies with ratings of A or better from agencies like A.M. Best, Moody's or Standard & Poor's. These ratings reflect the company's ability to meet its financial obligations, including annuity payments, even during economic downturns. After all, a company with a strong balance sheet and conservative investment practices is far more likely to honor its commitments decades down the road. Learn more about the annuity options available to you here. If your insurance company does fail, there are state guarantee associations that may step in to protect annuity holders, but this protection has significant limitations. Coverage typically caps at $250,000 to $300,000 per person per company, though this varies by state. Perhaps more importantly, though, these associations don't prevent all losses; they simply aim to minimize them. If you're considering putting a large portion of your retirement savings into annuities, spreading your investments across multiple highly-rated insurers can help you stay within these protection limits while reducing concentration risk. Not all annuities are created equal when it comes to safety. Fixed annuities offer the most predictable returns, with the insurance company guaranteeing a specific interest rate for a set period. If safety is your primary concern, fixed annuities generally offer the most straightforward protection, though they may struggle to keep pace with inflation over long periods. Variable annuities, on the other hand, tie your returns to underlying investment performance, which means your principal can fluctuate significantly. Indexed annuities fall somewhere in between, offering some market upside potential while typically protecting against losses. When you purchase an annuity, the interest rate environment significantly impacts both your returns and your safety. So, understanding where rates stand and where they might be heading can help you time your annuity purchase more strategically or choose products with more conservative guarantees. In higher-rate environments, insurance companies can invest your premiums more aggressively while still meeting their guaranteed obligations, creating a larger safety cushion. When rates are low, that margin shrinks, potentially forcing insurers to take on more risk to generate adequate returns. The greatest risk to annuity holders generally isn't company failure. It's the slow erosion of purchasing power through inflation. A fixed annuity that pays $1,000 per month might seem safe today, but if inflation averages 3% annually, that same payment will have significantly less buying power in 20 years. Some annuities offer inflation protection features or cost-of-living adjustments, but these typically come at the cost of lower initial payments. So, as you're evaluating annuity safety, you may want to consider whether the product protects not just your principal, but your lifestyle. Annuities can be a safe component of a retirement strategy, but their safety isn't automatic. It depends on careful product selection and realistic expectations about what they can and cannot do. So, rather than viewing annuities as either completely safe or completely risky, think of them as tools that can eliminate longevity risk, which is the risk that you'll outlive your money. To ensure you're making the safest bet possible, though, you'll need to choose the right type of annuity for your specific needs and timeline while keeping realistic expectations about what any single financial product can accomplish, especially in an uncertain economic environment.
Bloomberg
10 minutes ago
- Bloomberg
Corn Drops With Record US Harvest Seen Bigger Than Expected
Chicago corn futures fell to the lowest level in nearly a year after the US Department of Agriculture raised its already record-large outlook for the American harvest. The USDA in a monthly report Tuesday estimated US corn production at 16.742 billion bushels, with a yield of 188.8 bushels per acre, with each surpassing estimates in a Bloomberg survey. That's after farmers planted more corn acres than a year ago and fields benefited from abundant rainfall and minimal damaging heat.
