17/12/2025

BIZ & FINANCE WEDNESDAY | DEC 17, 2025

/thesuntelegram FOLLOW / Malaysian Paper

ON TELEGRAM m RAM

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It’s the last full trading week of 2025 THE final full trading week of 2025 is under way, but investors can’t start winding down for the holiday season just yet, with artificial intelligence (AI) jitters and fiscal woes should give investors a flavour of what this week may have in store: about AI – and the current signals aren’t looking good.

Yield curves’ steep climb US fiscal concerns and inflation fears – partly reflecting President Donald Trump’s trade and tax policy as well as the politicisation of the Fed – are resulting in steeper yield curves overall. The two-year/30-year spread is close to reaching its widest level in four years. Steeper curves are typically seen as a reflection of “normal” economic and financial conditions. But that’s not the case when the back end of the bond market is getting crushed by fears that the central bank has taken its eye off the inflation ball. Silver’s speculative spurt If you want evidence of a year-end speculative boom, look no further than silver. It’s up 30% in the last

three weeks. That is remarkable enough, but what this chart from Brent Donnelly at Spectra Markets shows is even more astonishing: an ounce of silver is now worth more than a barrel of U.S. crude oil for the first time ever, apart from when the price of oil futures briefly dropped below zero in April 2020. Oracle’s blurred vision In recent months, Oracle has traded more like a “meme” stock than one of the world’s biggest companies. Shares rose 36% in a single day in September and last week slid 15% in two days, a magnitude of decline only seen during the pandemic, 2008 and the dot-com crises. Oracle is increasingly becoming a bellwether of investors’ broader sentiment

US FDA sees no need for top warning on Covid vaccines BENGALURU: The US Food and Drug Administration has no plans to put a “black box” warning on Covid-19 vaccines, Bloomberg News reported on Monday, citing the agency’s top official Marty Makary. Some agency officials had recommended putting the most serious warning on the shots, but agency leaders, including top vaccine regulator Vinay Prasad, did not think it was necessary, FDA commissioner Makary told Bloomberg News in an interview. The Department of Health and Human Services, which oversees the FDA, did not immediately respond to a Reuters request for comment. CNN reported last week that the agency was planning to put a boxed warning on these vaccines, and that it was being orchestrated by Prasad, the FDA’s chief medical and scientific officer. Giving two doses of the vaccine just three months apart was linked to higher rates of side effects, such as myocarditis in young people, Makary said in the interview, adding that the prevalence may not be the same with annual dosing. Last month, Prasad told staffers in a memo that Covid shots probably contributed to the deaths of at least 10 children who died of heart inflammation. The FDA is investigating deaths potentially related to Covid-19 vaccines across multiple age groups as part of a safety review. Health Secretary Robert F. Kennedy Jr., a longtime vaccine skeptic, has sharply changed government policy on Covid vaccines, limiting access to people aged 65 and above as well as those with underlying conditions. Moderna did not immediately respond to a Reuters request for comment but has previously said that there were no new or undisclosed safety concerns in children or in pregnant women related to its mRNA based Covid shot, Spikevax. Pfizer, which markets another mRNA-based Covid shot with partner BioNTech SE, reaffirmed its safety and efficacy. – Reuters Given that China’s trade surplus just topped US$1 trillion (RM4.1 trillion) for the first time, pressure is mounting on Beijing to allow the yuan to rise further – much further. Jamie McGeever is a columnist for Reuters. Yuan’s growing strength The US dollar has held up well in the second half of the year, with the dollar index up nearly 2% in that period. But it has been on a steady downward path against the Chinese yuan. Going into the last full week of the year, this cross rate is at a 14 month low, with the 7.00-yuan barrier in sight.

30-year bond yields’ rapid rise Yields on long-dated bonds around the world are popping higher. The 30-year US yield last week reached 4.8670%, its highest since early September, as it broke convincingly above the 2025 average of 4.77%. Long bonds now have to contend with the prospect of having both a White House seeking to run the economy hot with loose fiscal policy and a dovish-leaning Fed. Rising long-term yields are not just a US phenomenon. Japan, Britain and Australia have been in the spotlight recently too, with the 30 year German yield last week leaping to its highest point since 2011.

ChatGPT made OpenAI the leader in artificial intelligence (AI) and a household name, rivals have closed the gap and some investors are wondering if the sensation has the wherewithal to stay dominant. Investor Michael Burry, made famous in the film The Big Short , recently likened OpenAI to Netscape, which ruled the web browser market in the mid-1990s only to lose to Microsoft’s Internet Explorer. “OpenAI is the next Netscape, doomed and hemorrhaging cash,“ Burry said recently in a post on X, formerly Twitter. Researcher Gary Marcus, known for being skeptical of AI hype, sees OpenAI as having lost the lead it captured with the launch of ChatGPT in November 2022. The startup is “burning billions of dollars a month,“ Marcus said of OpenAI. “Given how long the writing has been on the wall, I can only shake my head” as it falls. Yet ChatGPT was a tech launch like no other, breaking all consumer product growth records and now boasting more than 800 million – paid subscription and unpaid – weekly users. OpenAI’s valuation has soared to US$500 billion (RM2.04 trillion) in funding rounds, higher than any other private company. But the ChatGPT maker will end this year with a loss of several billion dollars and does not expect to be profitable before 2029, an eternity in the fast-moving and uncertain world of AI. Nonetheless, the startup has committed to paying more than US$1.4 trillion to computer chip makers and data centre builders to threatening to spoil the festive cheer. Wall Street, stung last week by gloomy warnings from tech giants Oracle and Broadcom, remains on edge about the profit-generating capabilities of AI. And even though the Federal Reserve cut interest rates last week and unveiled a programme of large scale T-bill purchases, long-term bond yields are rising and yield curves are steepening – both inside and outside the US. Does that mean investors should give up hopes for a “Santa rally?” Below are five breakdowns that

Will OpenAI be the next tech giant or next Netscape? NEW YORK: Three years after

As rivals close the gap and losses mount, investors debate whether OpenAI can stay ahead in the AI race. – UNSPLASH PIX

package in history, as investors endorsed his vision of morphing the EV maker into an AI and robotics juggernaut. As well, his artificial-intelligence (AI) startup xAI is in advanced talks to raise US$15 billion in fresh equity at a valuation of US$230 billion, according to a media report. – Reuters Espen Robak. “But it only seems to be going up.” Opinions are mixed on whether the situation will result in OpenAI postponing becoming a publicly traded company or instead make its way faster to Wall Street to cash in on the AI euphoria. Few AI industry analysts expect OpenAI to implode completely, since there is room in the market for several models to thrive. “At the end of the day, it’s not winner take all,“ said CFRA analyst Angelo Zino. “All of these companies will take a piece of the pie, and the pie continues to get bigger,“ he said of AI industry frontrunners. Also factored in is that while OpenAI has made dizzying financial commitments, terms of deals tend to be flexible and Microsoft is a major backer of the startup. – AFP

OpenAI teams to give ChatGPT their best efforts. OpenAI unveiled its latest ChatGPT model last week, that same day announcing Disney would invest in the startup and license characters for use in the bot and Sora video generating tool. OpenAI’s challenge is inspiring the confidence that the large sums of money it is investing will pay off, according to Foundation Capital partner Ashu Garg. For now OpenAI is raising money at lofty valuations while returns on those investments are questionable, Garg added. Yet OpenAI still has the faith of the world’s deepest-pocketed investors. “I’m always expecting OpenAI’s valuation to come down because competition is coming and its capital structure is so obviously inappropriate,“ said Pluris Valuation Advisors president

build infrastructure it needs for AI. The fierce cash burn is raising questions, especially since Google claims some 650 million people use its Gemini AI monthly and the tech giant has massive online ad revenue to back its spending on technology. Rivals Amazon, Meta and OpenAI investor Microsoft have deep pockets the ChatGPT-maker cannot match. A charismatic salesman, OpenAI CEO Sam Altman flashed rare annoyance when asked about the startup’s multi-trillion-dollar contracts in early November. A few days later, he warned internally that the startup is likely to face a “turbulent environment” and an “unfavourable economic climate,“ particularly given competitive pressure from Google. And when Google released its latest model to positive reactions, Altman issued a “red alert,“ urging

Musk’s net worth hits US$600b as SpaceX IPO nears MEXICO CITY: Elon Musk on Monday became the first person ever worth US$600 billion (RM2.5 trillion), Forbes said, on the heels of reports that his SpaceX startup was likely to go public at a valuation of US$800 billion. stake in SpaceX, which is preparing to go public next year, Reuters reported last week. The SpaceX valuation would strengthen Musk’s wealth by US$168 billion to an estimated US$677 billion as of 12pm ET on Monday, according to Forbes. maker Tesla, shares of which have risen 13% so far this year, despite flagging sales. They were up nearly 4% on Monday after Musk said the company was testing robotaxis without safety monitors in the front passenger seat.

In November, Tesla shareholders approved a US$1 trillion pay plan for Musk, the largest corporate pay

Musk, who was the first to surpass US$500 billion in net worth in October, owns an estimated 42%

Musk’s wealth also got a boost from his roughly 12% stake in EV