Nvidia fallout could COMPLICATE U.S.-China trade talks: Semafor

with the stunning resignation of NVIDIA CEO, Jensen Huang, who stepped down from the multi-billion. dollar tech company yesterday. after reports of two extramarital affairs, including one with an alleged Chinese spy. NVIDIA is one of Wall Street's. most valuable companies, serves as the linchpin of the artificial. intelligence boom. NVIDIA shares are down at least 11 % this week and. are headed. for a sixth straight weekly decline. Colette Kress, the company's chief. financial. officer will step in now as interim CEO, at least for this moment.

On social media yesterday, though, President Trump. suggested. Apple's Tim Cook should take the job. No indication that that'll happen, but Trump clearly making a preference known. Even as all of this goes on, lawmakers from both sides. of the aisle still want to hear. from Huang amid national security. concerns about his involvement. with the alleged Chinese spy. Before stepping down, Huang was in frequent. contact. with President Trump and Donald Trump. and Donald Trump donated tens. of millions to his projects. The chairman of the House Foreign. Affairs Committee, Republican Congressman Brian Mast. says Huang has agreed to testify. before Congress before the Thanksgiving.

recess. More details of that hearing have. not yet been finalized, but that means it's coming in a matter of days. So we might get some answers soon. Meanwhile, Congress also wants to hear. from Commerce Secretary Howard Lutnick. and his department's role in regulating AI chip. sales, including NVIDIA's. According to the New York Times, over the past year, Lutnick has frequently clashed. with top officials over how to. regulate sales of advanced technology, particularly NVIDIA's chip sales to Asia. The Times notes that those clashes. have drawn accusations from others.

in the administration and in Congress. that the Commerce Department has. become too cozy with NVIDIA and Jensen Huang and failed. to. adequately police the firm's chip. sales to China in particular. Treasury Secretary Scott Bessent, Secretary of State Marco Rubio. and Trade Representative Jameson Greer. have all pushed for tighter restrictions. Reuters now reporting that senior White. House officials are discussing. whether Lutnik should be pushed out. amid this NVIDIA scandal. That's according to two people. That's according to two people. Familiar with the situation. I want to bring in White House reporter.

for Semaphore Eleanor Mueller. Eleanor, just spectacular amounts. of fallout here on multiple levels. You've got the markets reacting. You've got the underpinning that NVIDIA has. within this AI market. We're watching that. You've got Congress trying to investigate. You've got the White House now saying is LUTNIC. about to become the fall guy? Pick on Avenue. We'll start wherever you. want. Go ahead. Well, as far as I THINK IT'S FAIR TO SAY. THAT HE'S HAD HIS ENEMIES WITHIN THE. ADMINISTRATION FOR A LONG TIME. AND SO THERE'S BENEFICIALS WITHIN THE. ADMINISTRATION YOU HAVE BEEN TALKING.

ABOUT WHETHER OR NOT LET NICK TO GO. FOR A LONG TIME. OPPORTUNISTIC MOMENT. OPPORTUNISTIC MOMENT. NOW THAT WE ARE SEEING Republicans on. and off Capitol Hill. I spoke to Steve Bannon, I spoke to Senators Tom. Tillis, John Kennedy, Jim Banks went on Fox News, adding to that, placing the blame squarely on Lutnik for not. only allowing NVIDIA to sell AI chips to. Megaspeed, this company owned by the alleged Chinese spy. that he had an affair with, Wang had an affair with, as well as, you know, allowing him even to travel with China,

to China with the president. You know, Senator Tillis said. that to me is a foundational breach. of competence by Lutnick. And so whether or not this really is the last. straw for him remains to be seen. We've seen this before with Epstein, with Tether, with Kander Fitzgerald, and he's stuck around through all of it. And so for as many people as we talked to who said. this could. be a problem for him, we talked to others who. said he's done it before, he might do it again. But I think the consensus is if anything does it, this is what's going to be, what does it?

Because we were talking yesterday. about the tangible policy impacts. that Jensen was able to get because. of his proximity with President Trump, sort of opening up chip markets to Asia, even as some national security officials. said that they didn't want that to happen. They wanted the chips information to remain. proprietary in the U .S., and when you point. out the sort of way that Lutnik has reacted to. that versus the way that others. in the admin, whether it's Jameson Greer. or Marco Rubio or Scott there is a difference. And so when you look at the way. that Republicans and Democrats alike.

are pushing for a crackdown on chip exports, what do. you expect to see. in the coming months or weeks? It's a great question. I talked with an AI executive yesterday. yesterday who said the timing here is key, right? This is the week that congressional negotiators. are deciding what does and does not make it. into must pass defense legislation. And so the executive said, you know, if you are someone who wants to make. sure that we should have tougher. export controls on AI chips, if you're someone that wants to. make sure that lawmakers are not. beholden to what Huang and others.

in the AI industry are telling. the Trump administration, what do you do? You discredit their leading CEO, and that's what seems to have happened. with Huang. What about Trump in all of this? Because he is slated to meet. with the Chinese leader Xi Jinping. next week at a, you know, apex summit, Asian economic summit. How does this complicate that? So the administration will say that it doesn't. complicate it. And part of one of their reasons. for that is because they say export controls, which is at the center of this debate. over NVIDIA, I've never been on the table, right?

They say trade representative Jameson. Gurr said repeatedly this week, we do not negotiate export controls. as a matter of national security. I spoke with analysts and former officials. who said it does complicate things. And that's because Trump and the U .S., it's. going to be going into this summit, going. in to this next round of U .S.-China trade talks. with China knowing that the Trump administration. can no longer unilaterally determine what's. going to happen. And that was going to be the CASE ANYWAY WITH. DEMOCRATS TAKING OVER THE HOUSE AND THE SENATE,

BUT NOW THEY ALSO HAVE THIS WIND AT THEIR BACK. FROM WHAT HAPPENED WITH NVIDIA. AND FOR THAT REASON IT'S GOING. TO BE A LOT HARDER FOR TRUMP. ADMINISTRATION OFFICIALS TO MAKE. COMMITMENTS THAT THE CHINESE ARE. CONFIDENT THEY CAN THIS IS GOING TO BE A. CONTINUALLY QUICK DEVELOPING STORY, ESPECIALLY AS REPUBLICANS AND DEMOCRATS IN. AGREEMENT THAT THEY NEED MORE. INFORMATION ON WHAT'S GOING ON HERE. SOUNDS LIKE WE'RE GOING TO HAVE AT LEAST ONE. THANKSGIVING BREAK WHICH MEANS. NEXT WEEK AT SOME POINT. WE'LL BE WATCHING THERE AND THEN OF COURSE THE. WAYS THAT LUTNIK IS OR ISN'T BROUGHT INTO THIS.

AS THE PRESIDENT PREPARES TO HEAD OVERSEAS. WE'RE ALSO WATCHING NEWS ON THE. WAR AS IT PERTAINS TO IRAN BECAUSE. THAT WAR IS STRETCHING INTO ITS NINTH MONTH. THE PRESIDENT YESTERDAY DIRECTING VICE. PRESIDENT J .D. VANCE TO SHIFT HIS FOCUS AWAY. FROM THE CONFLICT AND ONTO. TO WHAT TRUMP SAYS IS CRIME IN. DEMOCRATIC-RUN AREAS. PRESIDENT POSTED ON TRUTH SOCIAL IN PART THIS, QUOTE, WE DON'T NEED A DEAL WITH IRAN. THOSE DAYS HAVE LONG SINCE PASSED. WE'VE GOT THEIR MONEY, HUNDREDS OF BILLIONS OF. DOLLARS AND WE'VE. GOT THEIR STRAIGHT, DESPITE TRUMP'S CLAIM, OF COURSE,

THE STRAIGHT OF HORMOOZ REMAINS CONTESTED WITH THE. BRITISH MILITARY SAYING AT LEAST. TWO TANKERS WERE STRUCK IN RECENT DAYS. IT ALL COMES AFTER THE WALL STREET JOURNAL. REPORTED EARLIER THIS WEEK THAT VANCE, WHO HAD BLAMED THE WAR FOR REPUBLICAN MID-TERM. LOSSES WAS CONSIDERING FACE-TO-. FACE TALKS WITH A TOP IRANIAN SECURITY OFFICIAL. IN AN EFFORT TO END THE CONFLICT. SO, TRUMP, THE ECONOMICS OF THIS HAVE. ALWAYS BEEN. LINKED WITH THE STRAIGHT OF HORMOOZ, RIGHT? AND THAT'S IN PART WHY THE PRESIDENT KEEPS SAYING WE. WE HAVE IT, IT'S NOT CONTESTED, IT'S OURS. THAT OF COURSE ISN'T THE REALITY. BUT WHAT DOES IT TELL YOU THAT. THIS WHITE HOUSE IS NOW SAYING IT'S COOL,

WE DON'T HAVE TO LOOK AT THIS WAR. THAT WE STARTED, THAT WAS THE REASON IN PART for massive midterm losses. and that they don't it's always. been there was no clear exit ramp. and it now feels like they're saying the quiet. part out loud. They are and I think it's It's hard not. to say the quiet part out loud. after what happened over the midterms, right? Republicans suffered such a staggering. generational rebuke at voters' hands. More than half of voters were concerned.

about affordability. And it is so easy to tie that back to gas prices, right? There are so few things that people notice. and so easily tied to the administration. in power as gas prices. And so this seems to be, you know, a now explicit admission. by this administration that this is a problem. and there's no amount of going. on stage and telling people, well, the war will be over soon. Well, here's why it's really important. that we did this. Well, don't worry, gas prices are going to be. even lower. as soon as it's over. I think they're now accepting.

that that argument no longer holds as. much water as they once thought it did. I also just don't think and this will come to. fruition on the Hill, right? Because there's a funding deadline. There's a funding deadline in the early part of. December where Democrats, including Senator Chris Van Hollen, who's vying for a top spot. in the Democratic caucus now, is saying they're going to use. that as leverage to prompt a potential government. shutdown. That's not going to end the war on its own, but it could send a clearer message. if Republicans want to get on board. I don't know. I mean, very quickly, do you think they will? It could. Well, and Democrats also, I mean,

it's hard to have this conversation. without the context of starting January, Democrats control the House. They control the Senate with a comfortable margin, right? They'll be able to pass these war power. resolutions. They'll be able to pass reconciliation bills. if they need to. And yes, Trump still has veto authority, but it's going to send a much, much different message. And I think the administration knows. that's coming. Yeah, they know it's coming and we'll see if it happens. December. or if gavels officially have to. be transferred. But you cannot just decide that you're going to pivot.

away. from a war that you began and haven't fully ended. I think that's just too much. Hard to do. White House reporter for Semaphore, Eleanor Mueller, thank you as always for coming on, sharing your reporting.