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Who Advantages From the Nvidia Scandal Revelations?

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Nvidia CEO Jensen Huang admitted to having an affair with an alleged Chinese language spy, and a few are questioning the timing and agenda behind these allegations.

Earlier than we begin, let’s set the size of Nvidia in right now’s market.

First, it’s one of many “Magnificent 7” (Apple, Nvidia, Microsoft, Amazon, Alphabet, Meta, and Tesla) that make up over 33% of the market cap of the S&P 500.

And among the many Magazine 7, Nvidia makes up 18% of the whole market cap.

After which there’s this: “US Economic system More and more Revolves Round Knowledge Facilities” and this:

Average annual infrastructure spending as a percentage of GDP

Level being, Nvidia is a large deal, and this scandal (amongst different components) is having a large impression on its valuation and probably the broader US market and financial system:

Let’s begin with the chain of reports tales that constructed into a company communications disaster of epic proportions (HT to B. of Moon of Alabama, from whom we’ll be listening to extra in a second).

All of this led to Jensen Huang sending the e-mail beneath to all Nvidia workers on Sunday:

I owe my household and all of you an apology.

I used to be untrue to my spouse. My actions harm her and our kids. There isn’t any excuse for what I did. I’m deeply sorry.

All through my life, my household has given me love and assist. They deserve my honesty and loyalty. As a substitute, I allow them to down and broken the life we constructed collectively. I take full duty for what I did and the harm I brought on, and I settle for the criticism that comes with it.

To my spouse and household: I like you. I do know an apology can not undo what I’ve performed. I hope our household will heal and that, over time, I can earn again your belief.

To my colleagues at NVIDIA, together with these I’ve labored alongside for many years, and to our board, companions, and shareholders around the globe: you deserve higher from me. Main NVIDIA is the privilege of my life. My duty is to serve you and be worthy of your belief. I’ve fallen in need of that duty. I’m absolutely dedicated to NVIDIA and can work to earn again your confidence.

Relating to the nationwide safety considerations raised in information stories, NVIDIA’s Board of Administrators has initiated an impartial investigation. I assist the investigation and can cooperate absolutely. I like our nation and our firm. I’m dedicated to defending NVIDIA and supporting America’s nationwide safety. I’m proud and grateful to be an American.

My household bears no duty for my decisions. I do. Please give them privateness.

Jensen

Adopted by the next assertion from the Nvidia Board of Administrators:

The NVIDIA Board is initiating an impartial investigation in gentle of latest reporting that founder and CEO Jensen Huang has been the goal of a overseas intelligence effort.

A committee of impartial administrators, assisted by exterior impartial counsel, will oversee the investigation.

The Board prioritizes U.S. nationwide and financial safety, which is paramount to the pursuits of NVIDIA and its shareholders.

Whereas the Board has no motive to imagine that both nationwide safety or NVIDIA secrets and techniques have been compromised, the Board’s inquiry will look at all accessible info.

Jensen absolutely helps the overview and has dedicated to cooperating with it.

The Board has confidence in Jensen and his management crew and can present additional updates as acceptable.

Tuesday, the Board adopted up with information that it had “retained former performing U.S. Lawyer of the Southern District of New York Joon H. Kim and his agency Wachtell, Lipton, Rosen & Katz to conduct a radical and impartial investigation.”

Nvidia will launch its 3Q monetary outcomes subsequent Tuesday, November 17, at 2 p.m. PT.

All of this led former BlackRock portfolio supervisor Ed Dowd to touch upon the timing on the Espresso and a Mike podcast:

I imply, I feel this has been on the market for some time. And what I discover attention-grabbing is the timing of it post-midterms. Proper earlier than the Nvidia earnings. It’s been identified that Nvidia has been type of a mafia mob boss in relation to their chips. There’s been, , lots of stories that they pressure all of the consumers to purchase solely from them as a result of they offer financing.

So, and Jensen is clearly as a result of he needs…He’s about promoting chips. He’s a pick-and-shovel man for the AI gold rush. He needs to promote as many chips as doable. So, he’s professional open supply. So, I feel I feel the deep state in all probability doesn’t need open supply. They wish to management the AI finally, they usually don’t need folks to have entry to cheaper fashions.

So, I feel it’s very suspicious that that is all popping out now, in my humble opinion. I imply, I feel it was there. And I’m not saying, , Jensen’s ought to get off the hook, however the timing, I’m all the time about timing, and the timing is attention-grabbing.

B. from Moon of Alabama additionally smells a rat:

I’m wondering what this ‘spy’ story is admittedly about.

Whereas Jensen Huang has technical information, he’s by far too distant from the myriad particulars of chip manufacturing to make him a priceless goal for know-how espionage. There may be additionally no must push him to argue towards export restrictions to China. Nvidia, in its personal curiosity, has all the time favored limitless commerce.

Alice Huang might properly have had talks with Chinese language authorities. (Not solely in China do enterprise folks with ‘attention-grabbing’ enterprise contacts in ‘enemy’ nations often have such chats.) However I discover it unlikely that she was particularly tasked with concentrating on Jensen Huang. Her position is simply too elaborate.

The managed leak concerning the relation between the 2 Huangs, and the fully unverifiable spy allegations on high of that indiscretion, seemingly have a distinct objective.

Plenty of folks dislike Jensen Huang, who’s from Taiwan, for his ethnicity. They dislike his management over Nvidia and the sky-high costs of its chips. There are folks, like Anthropic chief Dario Amodei, who argue for harsher restriction on Chinese language open supply AI fashions.

Eradicating Jensen Huang from Nvidia would in all probability tank the corporate on the middle of the AI bubble. It’s not a great motive. So the goal could also be Jensen Huang however he will not be the one one.

There are others, like Marco Rubio, for whom something China is all the time the enemy. To leak this now could also be designed to cripple Trump and/or to sabotage the upcoming Trump and Xi summit. Rubio needs to run in 2028 and the hawks he wants as assist behind himself like such interventions.

In the meantime Jensen Huang has admitted that he has had an intimate relation with Alice. For now he’ll keep on the high of his firm whereas its board will examine the ‘spy’ allegations.

Arnaud Bertand, a French China booster, factors out that allegations aren’t proof:

Full textual content:

So I seemed into these allegations that Jensen had a romantic relationship with a Chinese language spy and, paradoxically, the one precise proof now we have that somebody is whoring themselves out to spies on this story is the media – all the remainder is unsubstantiated, simply journalists repeating what nameless US intelligence officers advised them. I’m not exaggerating, I truly learn all the important thing articles on this:

1) New York Occasions on Oct 29, the preliminary “scoop”:
nytimes.com/2026/10/29/us/Declare: Alice Huang is a Chinese language intelligence asset funneling info to Beijing. “Proof”: they have been advised so by “folks briefed on the surveillance, who spoke on the situation of anonymity as a result of the findings are drawn from categorized intelligence…” That’s it. The Occasions even admits it couldn’t decide which company monitored her, what she handed alongside, or its worth to China. In different phrases, they didn’t confirm the spy declare in any respect.

2) Wall Avenue Journal on Oct 30: wsj.com/tech/chinese-eDeclare: The US, Singapore and Taiwan suspect Alice Huang is a Chinese language intelligence supply, with Singapore and Taiwan even placing bodily surveillance groups on her. “Proof”: “folks accustomed to the matter mentioned.” That’s it. And the story truly fell aside inside a day since Singapore’s House Affairs ministry went on the file with a public rebuke of the WSJ article (mha.gov.sg/media-room/new) stating that “neither the Singapore Authorities nor its officers mentioned this,” and that “there have been no such investigations performed in respect of Alice Huang.” Taiwan declined to remark. In different phrases, the one authorities they invoked that went on the file denied the declare publicly.

3) New York Occasions once more on Nov 6, the “MSS recruit” story: nytimes.com/2026/11/06/us/Declare: Alice Huang was recruited by China’s Ministry of State Safety (MSS) particularly to gather intelligence on Jensen. “Proof”: “in response to folks briefed on U.S. surveillance.” That’s it. No new proof, no doc, no on-record supply for the declare. But the headline states it as plain reality, with out even an “allegedly.” 4) The Monetary Occasions, quoted beneath, on Nov 7 with the romance declare: ft.com/content material/a55a2aDeclare: A US authorities memo says Jensen had a romantic relationship with Alice Huang. “Proof”: “mentioned folks accustomed to the memo.” That’s it: nameless folks describing a memo the FT by no means noticed, which itself describes intelligence no person can examine. — It’s correctly extraordinary when you concentrate on it and also you couldn’t make it up: she’s accused of being an intelligence asset, but the one folks we are able to truly watch behaving as intelligence property – and admitting so in writing (since they freely cite spies as their solely supply) – are Western journalists. Issues are so dangerous that we’ve forgotten what precise journalism is: actual journalists – when nameless intelligence officers inform them one thing – would deal with it as a result in examine, not as a reality. They’d ask: why are they leaking this, why now, and who advantages? And, most significantly, they’d attempt to confirm the claims independently earlier than printing them – which is meant to be journalism 101 and wasn’t performed right here. You’d assume one thing would have been realized from the Iraq WMD story and the numerous different examples of the press laundering intelligence claims into front-page “info.” Apparently not – and it’s even the identical newspaper, the New York Occasions, main the cost.

He additionally factors out one other weak point within the story:

Brian Berletic additionally has some ideas:

In the meantime, the story retains constructing.

Listed below are the “4 jaw-dropping revelations ” (per Gary Marcus) that dropped Monday and Tuesday:

Commerce Dept. Chip Inquiry Was Halted After Nvidia Intervention New York Occasions, November 9, 2026
An investigation into Megaspeed, a Singapore firm that was shopping for superior Nvidia A.I. chips, was transferred to the Justice Division after a high Nvidia govt reached out to Commerce Division officers.

From MIT prof Yasheng Huang

From former NSC Senior Director for China & State Dep China Coordinator Julian Gewirtz:

Full textual content:

Jensen Huang reportedly instructed his crew at Nvidia “by no means to consider” planning for a Taiwan contingency.

Even though their enterprise is reliant on TSMC.

The Jensen-Megaspeed mess actually places these unimaginable — and barely-noticed — particulars from Stephen Witt’s The Considering Machine in a brand new gentle:

Huang refuses to contemplate the impression on his international enterprise if China have been to blockade or invade Taiwan, regardless of the common threats emanating from Beijing to just do that. “To my nice shock, Nvidia had performed no contingency planning for this eventuality,” Witt writes.

He quotes Deb Shoquist, Nvidia’s govt vice-president of operations: “If one thing occurs to Taiwan and TSMC, the ramifications are so giant it’s nearly like asking me what I’d do if California fell into the ocean.” Huang had instructed her “by no means to consider this query.”

We’ll come again to Gewirtz in a second, however first there was one more “jaw-dropper” within the NYT yesterday:

Regardless of Denial, Trump Was Instructed on Journey to China About Spying on Nvidia Chief

President Trump was advised aboard Air Drive One in Might en path to China that the US had obtained delicate intelligence exhibiting that Nvidia’s chief govt was in a relationship with a girl believed to be a Chinese language spy, folks with information of the matter mentioned.

The message was delivered by Marco Rubio, his secretary of state and nationwide safety adviser, shortly earlier than the Nvidia chief, Jensen Huang, joined the presidential journey to Beijing at Mr. Trump’s invitation. It marked not less than the second time in seven months that the president had been advised of intelligence about Mr. Huang’s involvement with the lady.

The existence of the beforehand unreported replace given to Mr. Trump contradicts the president’s assertion on Monday that he had not identified on the time of the journey about Mr. Huang’s relationship with the lady, who U.S. officers had concluded was working for China’s Ministry of State Safety.

Hmmm, I’m wondering who leaked this story to the Occasions? And if my suspicions are well-founded, what does Marco Rubio acquire from (possibly) blowing up the Trump administration’s uneasy commerce truce with China?

And only one extra:

And as for the implications of all this for US/China relations, let’s discuss with China hawk Julian Gewirtz’ Substack “Paper Tiger” (guess who that’s):

As Trump prepares to fulfill with Xi once more in lower than two weeks, the timing of those explosive revelations might considerably constrain one of the influential voices who has formed Trump’s extra accommodating line on China, in addition to the administration’s broader strategy to AI.

Requested on Sunday whether or not he ought to have acted on the warning, Trump replied, “No, I don’t assume so.” As journalists and Congress examine this mess, there are numerous main questions that want solutions:

Why did Trump select to not act on the warning concerning the relationship, and what, if something, did the remainder of his administration do?

When did Commerce study of the intelligence about Alice Huang, and what occurred to chip shipments to Megaspeed after that? (Chris McGuire argues on X, “Commerce might have blocked chip shipments to Megaspeed the second it came upon that it was run by a Chinese language spy, but it surely didn’t.”)

Will Trump increase the spy scandal immediately with Xi in Shenzhen?

What would be the results of Nvidia’s investigation of its revered founder and CEO?

Will Jensen Huang lose Trump’s ear — and can that have an effect on the course of Trump’s China coverage much more than new Democratic majorities in each Homes of Congress?

It’s price remembering that Huang wasn’t on the unique record for Trump’s journey to Beijing in Might. The president invited him on the final minute, and Huang caught up with Air Drive One on a refueling cease in Anchorage. Now three Republican Home committee chairs have requested Huang to temporary them behind closed doorways on November 18 — simply because the APEC leaders’ assembly opens in Shenzhen.

On Sunday, a reporter requested Trump whether or not he would convey Huang alongside on his subsequent journey to Asia. Trump replied, “I don’t know, however I’d definitely take him.”

Veteran reporter (one would possibly even name him a “China hand”) Nury Vittachi feedback on the sudden change in tone in Taiwanese media protection of Nvidia and Jensen Huang:

Mo Bitar had a concept about how this all occurred, and his appears to level to a Congressional Democrat slightly than Rubio:

October twenty ninth, the primary story. November third, the election. November fifth, Congress asks for a closed door briefing. November sixth, any person fingers the New York Occasions that categorized memo. November eighth, the e-mail and Nvidia stories earnings on the seventeenth. That’s not how information breaks. That’s how any person releases it.
…

Right here’s what I feel occurred. The folks in Washington who wished to cease promoting chips to China misplaced that struggle the day the president took his 25%. In order that they leaked the memo as an alternative.

They usually tried every thing else first. The GAIN AI Act, the AI Overwatch Act, offended letters to the Commerce Secretary, and an invite to testify earlier than the Senate that Jensen merely declined. Payments take years, however a intercourse scandal takes one information cycle. And now the loudest voice in America for promoting chips to China is a man who had an affair with an alleged Chinese language spy.
…
And it labored. This week, Elizabeth Warren mentioned, “We should cross bipartisan laws to maintain our superior AI know-how out of China’s fingers.” And no person in Washington goes to face subsequent to Jensen and argue.

The individuals who wish to management AI misplaced each vote, each invoice, and each assembly on the White Home. They usually received anyway with one memo about the place Jensen’s been placing his d**ok.

And this tweet names particular congressional names:

Full textual content:

The Actual Play Behind Jensen Huang’s “Spy” Scandal: A Traditional DC Two-for-One

Don’t let the “Chinese language spy” tabloid drama idiot you. The true story behind Jensen Huang’s affair scandal might have much less to do with espionage than with pure Washington politics. US China hawks could also be attempting to drag off a basic “two birds, one stone” play.

First, they wish to kneecap Jensen’s affect in DC. Huang has efficiently lobbied the Trump administration to ease export controls on high-end AI chips just like the H200, a transfer that has drawn sturdy opposition from China hawks in each events. Linking his affair to an govt at a agency suspected of chip smuggling affords a handy method to undermine his credibility, increase questions on whether or not he may very well be compromised, and put strain on the White Home to tighten the screws on chip exports once more.

Second, they’re pushing the “Chinese language spies are in all places” narrative to fire up safety panic. Spinning a private affair and a enterprise compliance dispute right into a “Chinese language spy” story—with out publicly presenting arduous proof—performs straight into Western fears. It smears China’s picture whereas giving Congress political ammunition to push for harsher tech restrictions and tighter controls on cross-border expertise and enterprise exchanges.

Take a look at the timing—it’s arduous to not increase questions. US intelligence reportedly knew concerning the matter greater than a yr in the past, and Trump had reportedly been briefed on the intelligence considerations. But the story solely broke within the press on October 29—simply days earlier than the midterms and weeks forward of Trump’s deliberate Asia journey, with Huang’s participation within the delegation nonetheless beneath dialogue. The timing, adopted by Huang’s November 8 assertion, inevitably raises questions on why the knowledge surfaced when it did. That “sit on it, then drop it at a politically handy second” sample appears very very similar to basic DC selective leaking.

Take a look at who’s main the cost: Brian Mast, John Moolenaar, and Rick Crawford
—the Republican chairmen of the Home International Affairs, China, and Intelligence committees—who simply demanded a closed-door briefing from Huang. In the meantime, Democratic Senator Elizabeth Warren has individually challenged Nvidia over its China-related chip exports. All 4 are longtime critics of Huang’s China chip gross sales and Massive Tech’s lobbying energy.

Overlook the spy thriller narrative and have a look at what Jensen Huang’s opponents in Washington may very well be attempting to attain. With the midterms now behind them and Democrats set to take management of Congress within the subsequent session, the true tug-of-war over AI regulation and China chip coverage between Trump and the incoming Democratic-led Congress is simply getting began.

All of this can be a large win for China hawks who can now tie Nvidia to the unpopular Trump and tie Trump to the now-tainted Nvidia CEO Jensen Huang.

I’m curious what the large cash gamers consider this and if any of them have been concerned in pushing this story, which, as B. identified at Moon of Alabama, was mainly identified in late 2025 — the non-salacious components anyhow, as a result of there’s large cash at stake right here and a serious Nvidia share worth dive might go a great distance towards popping the AI bubble.

Additionally, provided that Trump getting his butt kicked by China within the commerce wars was one of the disastrous occasions of his first time period, who’s pushing a renewal of battle with the Center Kingdom, and the way do they count on to profit?

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