Trump Wants Big Tech to Pay for Power

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Replit could hit a valuation of $9 billion in a new round of funding we have the details. And we'll be joined by the Chairman of the Federal Trade Commission for a conversation on antitrust, consumer protection, and AI regulation. That is later this hour. Our top story, the Trump administration and governors from Northeastern States are taking an unprecedented step to get tech companies to pay for surging energy prices as data centers gobble up more electricity. The administration will direct the country's largest grid operator, PJM, into connection, to hold an emergency power auction. That's according to a White House official. Those companies will be able to bid on 15-year contracts for new electricity generation, which could support potentially $15 billion worth of new power plants to fuel the AI boom, also according to the official. Bloomberg Senior Tech Editor, Mike Shepard, joins us now. What do we need to know here, Shep? I mean, this is very much in the consciousness of this administration, but also at the forefront of what the hyperscalers are thinking about, too. Well, really, as in a lot of ways, while the administration is trying to find a way to make the tech companies pay for some of this new power that they would need to sustain and keep the AI boom going, they are also giving the tech industry in large part, especially the biggest companies, the hyperscalers, what they want to. They are willing to pay for some of that extra power generation, but they need somehow the wherewithal from the grid operators themselves to add that infrastructure. So this would provide some stability in the funding, and it would also provide a slug of money for the grid operator, in this case, PJM interconnection to start laying the groundwork for some of that infrastructure. Now, what's interesting about this is PJM actually runs these kinds of so-called emergency auctions on a somewhat regular basis, and they almost have one in the pipeline for this very need, for the question of data centers, but they usually go on 12-month intervals, not 15-year intervals. So this really would provide pricing stability for those buyers. Now, one other question, though, Ed, is how the grid operators will proceed with this. And PJM was not invited to the White House event, we are expecting an announcement shortly from Interior Secretary Doug Burgham and Energy Secretary Chris Wright, and it's unclear exactly how enthusiastically they will be embracing this. - The other big news overnight, the United States and Taiwan have reached a deal to lower tariffs on some goods, but critically cooperate and co-invest in semiconductor capacity. What do we need to know there, Mike? - Well, what's really key in this deal is that not only are we seeing the tariff rate on goods from Taiwan drop to 15% from the current 20%, just as importantly we are seeing the outlines of a much more significant investment in American semiconductor manufacturing. And the announcement from the White House didn't name any names in terms of companies, but you and I, our heads are gonna go right to Taiwan semiconductor manufacturing company. They are the top maker of AI chips, and they are really the leading edge of Vanguard of chip production in Taiwan. And under this deal we have been told by sources, TSMC would commit to building for additional semiconductor manufacturing plants here in Arizona through the 2030s. And that's on top of six plants that they have already planned to build into advanced packaging plants. So we're looking for additional investment, and the total added investment would be as much as $100 billion. And that is what we're hearing from camera secretary, Howard Lutnig. - TSMC's US sister shares hitting record highs on track for their best weeks since June, and it has a lot of momentum to do with their earnings print as well. But of course cooperation with the US members, Mike Sheppard, thank you very much. Both of those stories that Mike just outlined are playing out in markets. Let's start with the energy auction piece first. Utilities, probably the second biggest declineer as a group within the S&P 500, S&P utilities index, now seven tenths would be a percent. And within that you see single names, like Constellation, like Vistra, with very market, almost double digit declines in the session. The big story on semiconductors still is the bottleneck that is memory. But the bottleneck in memory drives up the main players. Micron, again another name in equity markets that is pushing record highs. It is on track for its eighth straight week of gains. Eight straight weekly gain, that's his best run since 2016. Prices are high, supply is tight. And that's good when you're one of the main players. Let's talk more about markets. Martin Orton, Empower Chief Investment Strategist, joins us now. And I want to start with the memory bottleneck. It seems to me to be severe, just in the control room. Let's get that chart ready on DDR4. Because as we enter the new year, this has become a great story for all parts of the data center supply chain. How are you looking into that matter? Well, I think it seems like as we're entering 2026, we're reaching that phase that we had anticipated within the AI lifecycle. And that's the bottleneck phase where the building and the demand and the supply are exponentially moving higher. And that's putting us at a point where we're facing constraints and writing how long into them every which way we turn. And I think the memory element is a big one. And not just because it relates to the AI trade, but because it has ramifications outside of AI. So I think that's something that we're going to need to watch an earnings season, to get a sense for what that looks like, not just for the AI trade, but for some of these other areas like PCs and get a sense for how folks are navigating that. There are many still grappling with the demand supply, supply demand equation. Three things have happened. We went through memory. PGM actually downgraded and cut its peak time demand forecast because a lot of the data centers aren't actually being built, right? There are issues with construction and actually securing electricity supply. And then there's the actions of this administration. Has that any of that given you kind of paused for thought on how intact this cycle is? Well, I guess just taking, say, the downgrad of energy there, I think one consideration is that timelines have always been in flux. When you look at what it takes to build a data center, the permitting that goes along with it, the construction, all the different elements. It's a multi-year proposition. And so it's no surprise that it's hard to really understand when exactly the data center is coming online. So I think the progression creates clarity. I don't know if that's a change to the AI narrative. And then of course, you have President Trump and the affordability issues running headlong into the AI trade. So another factor to consider, but I guess what we'll be looking for in an earnings season is does the Boondasl continue? Yes, we have all these factors that I think create moments of doubt for investors over the course of 2026. But are we seeing the Boondasl continue? Can we take comfort from the idea like we did with Taiwan Semi that CapEx continues, that revenues continue? And so that's what I think is really the focus as we move into Q4 earnings season. Let's go back to our top story, Bloomberg reporting that the White House in association with governors from the North East wants to force an auction for the data center operators. We talk about the heavy hand of the White House of Washington. But how heavy is that hand to your mind? Well, we're still, I think, somewhat-- I mean, broadly speaking, around the affordability issues and a trial balloon phase, right? Where different ideas are suggested and we see how the market anticipates and how we actually implement those ideas. This one seems a little bit more fully baked simply because it's coming not just from truth social, but from the administration officials more broadly. And it's, you know, to Bloomberg's reporting, it's not just focused on the affordability issue, but really directed at the heart of the need of AI, which is bringing energy online. So it seems as though it's serving multiple purposes. What will be interesting to see is how the AI providers respond to this. Is this considered a good news? Does it bring on and relieve some constraint for them or is there frustration on what it could mean for their margins? And I think that's something we're going to need to watch. You know, margins will find out about, as you said, during earnings, which start in earnest next week. Could we discuss that a bit more, Martin, to finish? Where are you looking within the earnings window? What kind of data points are going to drive your thesis for this coming year in the tech sector? Well, we're in an AI moment of doubt, as we speak. I mean, really since October 29th, we've seen this kind of malaise hit AI names. As folks start to worry about some of the very issues we're discussing and also including things like circular financing and all the big spending that we're seeing. And so I think at a very high level, we're still going to look for those things around revenue, for those things around Catholics, just to get a sense for whether the company's confidence remains and whether they're continuing to improve their collection of rents from this space. I also think we're going to want to look more broadly at the overall market and get a sense for are we seeing AI implementation? And I think that can mean looking at what folks are spending on clouds, costs, looking at what they're spending on software. Are we beginning to see more than just general purpose implementation? I think that's something that we're going to need to watch as well. So I think in this earnings season, it's really casting a wide net end, as always, listening to guidance and how companies are planning to navigate the challenges that they're facing. Martin Orton of Empower, thank you very much. Now, coming up, AI coding startup Replic could be reaching a valuation of $9 billion. We have more on the reporting next. This is Bloomberg Tech. (upbeat music) Open AI and Microsoft failed to avoid a trial over Elon Musk claims that open AI betrayed its founding mission as a public charity. When it took billions in funding from the software giant and they plans to operate as a for profit business, the case was ordered to proceed to a jury trial in late April. Another top story, AI coding startup Replic is nearing a deal for a new round of funding that would roughly triple its valuation to $9 billion. That's according to sources. Let's get the details with Bloomberg's venture capital reporter, Natasha Mascarain, as part of the team that broke the story. Let's start with the round. What do we know about the size who's participating and the emphasis on that big jump in valuation? Totally. So the last time we reported that Replic was raising, it was only four months ago in September at a $3 billion valuation. Now we're hearing that it's at a $9 billion valuation going to raise $400 million from an existing investor led round, Georgian. And we're not surprised back-to-back fundraising is more common than not an AI startup these days and Replic as a coding company is no exception. It is more common than not. And so is a discussion around vibe coding and the different coding platforms that are out there. I guess the best place to go next is why there's an attraction to Replic and why it's different from the others. Yeah, when I think about coding startups, I think about two buckets. I think about the ones that are focusing on selling to enterprises, the big corporations. I think that's cursor and anthropic. Then there's a second bucket. And that's where I really placed Replic. It's focusing on getting the non-developer to use vibe coding at their organization. And it's a big theme I'm hearing as I ask CEOs what they're thinking about for 2026. They want you to prototype and not be living in your docs and decks too much. So when I think about investor interest in Replic, it's really a bet on getting the non-technical coders start shipping apps and trying it themselves. The Tasha masquerade is making the Bloomberg tech debut starting 2026 strong. What do we expect? Like, what is this rep-plate round signal for the fundraising environment for AI? My hunch is that you're going to be pretty busy. It's going to be a very busy year. You know, when I think about what used to be the standard in Silicon Valley, I used to think you need an outside investor to value each new round, to give you sort of a new mark in Silicon Valley of being deserving of that valuation. For me, now that's a retired concept. Seeing Georgian come in and back an existing investment at that higher valuation. It's considered them making a smart and savvy move with asymmetric information. So I expect to see a lot more existing investors marking up their stakes, looking to double down on their big bets, and get bigger chunks of those startups because we definitely know they're going to be raising more and maybe diluting that ownership as time goes on. - Bloomberg's from Tasha masquerade, thank you. Another story in the world of private markets. German investor, digital transformation capital partners, is gearing up to raise what would be Europe's largest ever venture capital fund, focused on defense startups with the target of about $580 million, US dollars. Tech reporter, Christina Curiosoglu has been following the story joins us now from Berlin. Tell me about the fund, you know, the size is the headline, but the players and what they hope to do with the money raised. - Yeah, so TGCP is a firm that's Hamburg-based and they will be looking at supply chains, materials, robotics, and all kinds of things that are concerned with the defense infrastructure in Europe. And, you know, the process here, it's been pretty slow. Russia's full-scale invasion into Ukraine happened nearly four years ago. And just now we slowly see more and more funds being raised across Europe that are looking at the tech, even though that conflict has shown how important drones become and what kind of like modern warfare questions have come up. - There are companies and telling out there, but in your reporting, do you get a sense for why it's been so slow? If the tech's there and the capital is finally there as well? - Yes, so a couple of reasons, of course. So what we've been hearing from our sources is that, for example, TGCP's funds now is being anchored by Portia, the family holding and by Deutsche Telekom. And this marks a massive shift in mentality that these companies are now investing in a fund that potentially will back weapon systems. So private companies put a lot of restrictions on themselves when it came to weapon investments and also public funds were very slow to adjust. And at the same time, it's not just the companies, it's also a market question and terms of, if you're looking to develop weapons and military products, then you need a founder that has the respective experience. And you also probably only have one customer and that is the government or a government for that matter. And that's a tough customer to have because the procurement processes are slow and the, you know, it's very complex. So I think to come back to DTCP, they kind of like broadened the space that they want to invest in a bit to look at products that are being made for civilian and military technologies and for weapons to kind of like circle around that question. - Blinberg, tech reporter, Christina, curious ogly, great to have you on the show. Thank you so much. You're coming up the rise of humanoid robots and why Barclays says it could be the next $200 billion market. This is Blinberg, tech. - Every day millions of customers engage with AI agents like me. We work around the clock and have the facts at our fingertips. We're fast and effective, but incredibly patient. And we're built on Sierra, the leading AI-powered customer experience platform. No hold music, just answers and action. That's Sierra.ai. - I'm Barry Rittalts inviting you to join me for the Masters in Business podcast. Every week we bring you fascinating conversations with the people who shape markets, investing and business. CEOs, fund managers, billionaires, Nobel laureates, traders, analysts, economists, everybody that affects what's going on in the market, whether you own stocks, bonds, real estate commodities, crypto, you really need to hear these conversations. Sometimes it's behaviors like Dick Taylor or Bob Schiller. Sometimes it's fund managers like Peter Lynch, Bill Miller, Ray Dalio. Sometimes it's authors, Michael Lewis, author of the Big Short and Moneyball. Regardless of the conversation, these are the folks that move markets each week. That's the Masters in Business podcast with me. Barry Rittalts, listen on Apple, Spotify, or wherever you get your podcasts. (upbeat music) Just a few years ago, the robots here were kind of janky. They were wobbly and they had wires coming out of their head and they looked like science experiments. And it's really fascinating to see just how quickly humanoids are turning into a real product. - That was Open Mind CEO, Jan Lipphart, speaking with us at CES, where humanoid robots dominated the conversation. This week, Barkley's published its forecast for the humanoid market with expectations that it could grow to $200 billion by 2035. Here to break down that research is on Eats that I've told you over, Barkley's romantic FICC research team director, really timely piece of research as well. And what is interesting is there's the $200 billion market forecast, but you identify two or three key factors about why you now see the commercial viability. What are those factors? - Hello, and the good morning and thanks for having me on the show, AI is indeed getting very physical and I think humanoid robots are the forefront of this trend. But I think the reason why the proposition is changing and why there's going to be a demand for these robots is because the demographics of the world population is changing. The reality is that humans are getting older, I think by 2050, the share of people aged about 65 is going to double. Also, humans don't really want to live in rural areas anymore. They want to be based in cities, but the factories and the manufacturing facilities are actually located outside of these cities, which creates a bit of a structural issue. And then let's not forget that workers' preferences are changing. So which means that they will be certain essential jobs yet undesirable, which might not be filled. And I think this is precisely where humanoids enter the picture. I think they could be taking on these repetitive jobs, these dull, dirty, potentially dangerous jobs of maintaining productivity and producing efficiency gains for the industry as a whole. The main players in this field talk a lot about the labor shortage in particular in manufacturing and heavy industry. You're saying it's going to be a $200 billion market by 2035. In your research, do you have any sense of how real the market is today? How many humanoids are actually out there in manufacturing contexts around the world in present day? The reality is that I think that humanoid robots are no longer confined to research labs. They're stepping out of the lab and they're getting into the real economy, into the real world. They are a couple of thousands of humanoid robots already deployed on factory floors, doing actual work in manufacturing, which I think is a natural starting place because these are jobs that are more structured, more easily defined. So it is the place to start for humanoids. But I think this is going to change in the next five to 10 years as the technology matures and as this market picks up space. I think I wouldn't be surprised that by 2045, when we actually project that the humanoids market is going to be as big as $200 billion that will see tens of thousands. Potention even millions of humanoid robots. The supply chain for the humanoid robot is fascinating. I think a lot of emphasis at CES was on the breakthroughs in the models themselves, the ability to solve in particular the real world data limitations. But you've got some interesting pricing. You're talking about like per unit, $3 million down to $100,000. The economics changing, $15,000 for a humanoid robot. What's happening that gives you conviction that you'll see that change in the economics of a humanoid robot? Right, so I think that there are a couple of things happening at the same time. First of all, over the past three to five years, we've seen really significant breakthroughs in cognitive AI models. But it's not only the AI that is getting better. The batteries are also getting better, more efficient, more powerful. And they also have been significant breakthroughs in high-precision manufacturing. And when I put all these three components together, the result is that the unit cost for producing humanoid robots is coming down. We estimate in our research that costs have declined by 30 times over the past five years from $3 million for a unit to $100,000 for a unit. And this means that the economics are getting optically more attractive. The use cases are expanding. And hence, I think that the investment opportunities are also becoming more real and stronger. Right. Very quickly, Zenita, who's ahead? We have 15 seconds, China or the United States here. I think it's going to be a tough competition. I think for the moment, it's China. This is where we see most of the robots being deployed. But I think the US is quickly catching up. Zenita, thoroughover of Barclays, who again out this week with the forecast that humanoid will be a $200 billion market by 2035. Thank you so much for joining us on the program. Now, coming up an important conversation. We're going to be joined by the Chairman of the Federal Trade Commission to discuss antitrust, consumer protection, and AI regulation. A lot has happened this week with regards to the FTC, a conversation also about aquahires, which in the technology industry was a mainstay story of 2025. That conversation is next. This is what your markets look like, flat at the index level, outperformance in chips. Welcome to our Bloomberg TV and radio audiences around the world. A recurring theme of recent tech, M&A, has been deals to bring in talent in so-called aquahires. The Federal Trade Commission is taking notice, one member of the FTC warned Thursday that these, quote, "creative deal structures could raise antitrust concerns." Let's discuss and delighted to welcome Andrew Ferguson, Chairman of the FTC to the program. We covered the topic of aquahires on Bloomberg Tech regularly. It was a mainstay story in 2025. When does a talent deal stop being a talent deal and become more than that, become a merger? What are the rules-based approach that the FTC would take, Chairman, to look at that? Yes, so we are examining, look, aquahires have been around, especially in this sort of startup founder space for a long time. And they've gotten bigger, basically, in the last admin. And a lot of people were of the view that these things were sort of being constructed and these big deals to try to escape, you know, Hartscott-Rodino review, which is pre-merger any trust review in the United States, because the Biden administration was trying to block all deals. And I think generally they were. That isn't necessary anymore. We don't need clever workarounds around any trust review anymore, because at the FTC, under the Trump administration, you get a fair shake. I'm not saying your deal will go through. I've sued to block several deals this year, and I've won those cases. But if your deal's not illegal, we get out of the way and sort of let the market take care of things. So we are beginning to examine that the HSR Act has a provision that says you're not allowed to structure deals in order to escape pre-merger review. And so we are beginning to examine the exactly hires to make sure that they aren't an attempt to get around HSR review. But the message I want to send to Silicon Valley and to the M&A infrastructure generally is you don't need to structure deals as a clever attempt to get around pre-merger review. You'll get a fair shake at the FTC. Deal may not go through, but if your deal is legal, I will get out of your way very quickly. And if it's not, I'll take you to court, and I'll fight to win there. We're not going to let the process be the punishment anymore. But it is important to us to make sure that people aren't going to use clever deal structures to get around pre-merger review. The language of clever or creative deal structures that I cited at the beginning of our conversation was from your colleague and fellow Commissioner Mark Madoll, who was speaking at a conference in California yesterday. I think what the industry hopes to understand from you is what the threshold is or what the set of rules would be, where a hiring proposal or situation should be reported to antitrust authorities. It should be as simple as that. It should be by-road reported. Yeah, and we are beginning to examine how these deals work. Aquahire deal structures vary from deal to deal. And so they wouldn't necessarily be a sort of a one-size-fits-all rule. But we are beginning to examine these big aquahire deals that raise a lot of attention so that we can understand when an aquahire is in fact an acquisition that might be covered by the pre-merger review laws. And when it's not, and we need to understand them before we're sort of out there telling people what the rules are. But this is-- you're right, this has become a big enough deal that we are beginning to look very closely at how these things work, including determining whether we need to promulgate additional guidance here in the coming months about how we understand these aquahires. Is there a factor that matters more to you? The number of employees hired or putting a value on the intellectual capital or the competitive advantage that such a transaction would give the aquahire. So the value that matters for HSR is set by the statute. That's not really here or there. But the HSR app applies to deals where assets or stock are being purchased. And that's what triggers HSR review. And so what we need to understand, which is why we're beginning to examine this question now, is when does an aquahire involve the sale of the acquisition of assets or stock in a way that would trigger the statute? Look, at the end of the day, I'm a lawyer and a law enforcer. And I enforce statutes and those statutes have texts. And so it's my job to understand whether things happening in the marketplace trigger the text that Congress has actually passed for us. But that's what we're looking at. We're not trying to set sort of-- we wouldn't be setting like aquahire rules generally. We would be looking at deals and trying to understand, does this in fact involve the acquisition or sale of assets or stock? And is anything being structured as an attempt to circumvent review? But I'm not here to say this is what the rules are. There will be hard and fast clear rules. There aren't even for the ordinary deals. We've got the HSR act and the HSR rules. But deal structure is even an ordinary in the name very widely. And so we have to apply the text that Congress actually wrote to specific deals. But aquahires have become frequent enough and large enough that we are beginning to look at the appropriate way to apply the law that Congress actually adopted to aquahires. It's not my job as an enforcer to sort of fit square pegs into round holes, but it is my job to make sure that the will of Congress, which is the will of the people at the end of the day, is being followed. And that's what we're here to try to do. We're trying to figure out how that applies in the case of aquahires. Chairman, how common is this in the field of artificial intelligence? Or how often is this particular scenario arising and crossing your desk from the AI industry? We've seen a couple in the last 12 months. My understanding is that the act we hire sort of structure, if you want to call it that, where a firm acquires a lot of the talent in another firm is pretty old. It's been going on for a long time. But it often involves very small firms. And I think the reason that a lot of people are starting to notice it is because now it involves much larger firms and the sort of price being attached to obtaining the talent into licensing IP is in the billions. So I've definitely seen a couple in the AI space this year, which is what is attracted a lot of the attention. And it's why we're beginning to try to examine how are these working and how does the law that Congress passed governing pre-merger review actually apply here, as well as the provision in the pre-merger review law that says you can't structure a deal in order to try to escape the HSR review. So that is what we are trying to understand now. But certainly, I mean, you all have reported on them. You can read them about them in the Wall Street Journal. It's definitely true that there have been a couple of these big ones in the AI area. You alive with us on Bloomberg, television, Bloomberg radar around the world was speaking to Andrew Ferguson, Chairman of the FTC. I think the biggest case study of late, which just to give an example of structure, is Envidia and Grock. Because what Envidia CEO Jents among told me a couple of weeks ago is they hired about 400 engineers. But it also included the licensing of the core technology at a $20 billion value, but over a set time horizon. Grock exists as a company still, but with a focus on one of its business lines, that hiring and licensing of technology for that, is there anything specific there, Chairman? Yeah, so I can't talk about specific deals or specific potential investigations. As a law enforcer, I have to maintain a lot of confidentiality about the work of the commission. But I mean, that particular structure of the aquahire was different from example from the one that Meta conducted earlier in the year. These things vary pretty wildly. The terms of the software and IP licensing can vary. The number of employees obtained in the transaction can vary. And so we're trying to understand these things first of all. Because the last thing I want to do is sort of blindly charge ahead with a bunch of pre-determined assumptions and start trying to apply the law to something we don't understand. But it is very important to me, because it's very important to Congress that people not try to come up with ways to attempt to get around pre-merger review. And that's what we're looking at. And again, it's just not necessary. I get why people wanted to do this in the previous administration where the antitrust enforcers tended to use the process as a way to block deals rather than sort of being more honest about it and taking people to court. But under the Trump administration, we are either going to get out of your way very quickly or we are going to take you to court. We're not letting the process be the punishment. And so people don't need to try to come up with ways to get around HSR. You will get a fair shake at the FTC. Chairman, there's a lot of interest in the FTC and consumer protection on what the FTC's remit is in the domain of AI. It's an example. I know you won't comment on specific cases. But X and Elon Musk's AI and GROC have been in the news because of the use of the tool to generate non-consensual, sexualized images. Does the FTC have a role in regulating from a consumer protection standpoint that domain? Yeah, I mean, the president, Congress passed, and the president signed in spring of last year that take a down act, which is seminal ground breaking legislation to protect people from artificially generated non-consensual intimate images. The criminal component of that law, that the Department of Justice enforces is already in effect, the part that we enforce, where we have to compel platforms to take down these images and then bring enforcement actions that they fail will take effect in the spring. We are getting ready for that. I have been meeting with sort of the elite child protection prosecutors and investigators at the Department of Homeland Security to make sure that we're synced up on that mission. This is relatively new to the FTC. And I want to make sure we hit the ground running when the authority takes effect. Right now, we are hiring specialists, prosecutors, lawyers, investigators, and IT experts to enable us the second that this thing takes effect to start bringing enforcement actions, wherever these things are happening. And I don't care what kind of company you are. If you are a platform, whether you're a legacy social media company, a burgeoning AI company, I don't care. If you are violating the Take It Down Act, you are going to hear from us. And we are going to be ready to do it. This is incredibly important legislation. I'm really excited that the FTC has a role in this. I lobby Congress very heavily to make sure that we had enough money to get this program off the ground when it takes effect in the middle of this year. We are getting that money, and we will be ready. Chairman, President Trump has nominated David McNeil to the commission. Our audience have asked me to ask you your thoughts on that. Someone, perhaps without antitrust, experience, legal experience, commission experience. And somebody, frankly, with high net wealth, your thoughts, please. Look, I am generally the view that Washington has too many lawyers. I think it is great that the president has decided to nominate someone who isn't a lawyer who doesn't think in the pathways that lawyers always think. I think it's great that the president has nominated. I've never met Mr. McNeil. I've talked to him a little since the nomination. The man is a true American patriot. He's created thousands of jobs in this country. He has been one of the most outspoken proponents of manufacturing here in America. That has been one of the president's principal economic priorities, is to make sure we make and build things in America. David McNeil has done that. He has been successful in doing that. And I think it's great that there is going to be sort of someone with that perspective who isn't coming at this like I am from fancy law schools with the long sort of litigation and law enforcement background. He's coming at it as a job creator, as a wealth creator, and as one of the most outspoken proponents of manufacturing in America that there is in this country. Is it an unconventional pick? Yeah, of course it is. But part of what has made President Trump so successful is that he doesn't always think in the conventions that govern DC. And I think that this is a really, really good idea to bring someone with Mr. McNeil's perspective here at the commission. Chairman, the major concern for the consumer right now is affordability. What is the FTC able to do on pricing pressure, bringing prices down, addressing that consumer concern? Yeah, I mean, it's one of my main concerns too. We're doing a lot on this front, on the merger of you front. My first two merger enforcement actions were in the health care space. We just won one of those health care enforcement actions last week and several months before the judge denied our injunction. But only because after I sued them, they offered to divest the assets that were the problem. So that was a win for the commission as well. Another merger enforcement action I brought is about industrial adhesives that are used to build homes. We have a real home building crisis in this country. Although under President Trump, home sales went up last year for the first time in a while. We still have a home affordability crisis in this country. And I have focused intently on the competition side on making sure that we are active in markets, grocery, health care, homes to try to bring prices down to for consumers and to make sure that all Americans get the advantages that come with vigorous competition. On the other side, I sued ticket master and a groundbreaking lawsuit charging them with having basically inflated all the prices of tickets in violation of multiple federal laws. Americans have been complaining justly for a long time that it has become almost impossible to take your family to a ballgame or to a concert without having to fork over the value of a mortgage payment to do it. We have been very active in the ticketing space to make sure that those prices are going to come down. We have been bringing actions on the consumer protection side in the health care space. We've also been bringing a lot of consumer protection cases and competition cases to protect the value of wages against non-compete, against job scams. The FTC is a little agency. Our budget is even half a billion dollars, but we have returned literally billions of dollars of wrongfully taken money just in the last year back in the pockets of the American consumers. We are doing everything we can within our little remit to try to bring down prices and to make this country a more affordable place to live, which is exactly what President Trump has been telling us to do. - Chairman, very quickly Bloomberg's reported that the White House is considering you for a DOJ fraud role. What would that entail? And legally, would it be possible for you to take on that role while remaining chair of the FTC? - I can tell you definitively, I'm not leaving the Federal Trade Commission and I'm not going to the Department of Justice. This is an important full-time job that the President entrusted me with to try to help the American people that just voted in their tens of millions to make Donald Trump President. That's what we have done. We've sent billions of dollars of wrongfully taken money back to Americans and I'm focused on fighting fraud and protecting competition right here at the FTC. - Adrie Ferguson, FTC Chairman. Thank you for your time here on Bloomberg Tech. Okay, coming up, Jemena Alaman of Prometeo joins us to discuss the future of banking within AI. That's next, this is Bloomberg Tech. (upbeat music) - Bloomberg Daybreak is your best way to get informed first thing in the morning right in your podcast feed. Hi, I'm Karen Moscow. - And I'm Nathan Hager. Each morning we're up early, putting together the latest episode of Bloomberg Daybreak US Edition. It's your daily 15 minute podcast on the latest in global news, politics and international relations. - Listen to the Bloomberg Daybreak US Edition podcast each morning for the stories that matter with the context you need. Find us on Apple, Spotify or anywhere you listen. (upbeat music) - After TSMC reported huge profits in the fourth quarter, CFO Wendell Huang sat down with Bloomberg Tech's and Abel Dralas to affirm his strong conviction in the mega trend of AI demand. He first weighed in on whether the company is prioritizing certain markets as part of his expansion plans. Listen to this. - We don't look at it this way. It's really depends on customer demand. In the US a lot of customers wants to go there so we will expand over there. But for the leading edge technologies, it will be in Taiwan because it's a heavy cooperation between the R&D people and operation people for practical reasons. - And leading edge will continue to be led by Taiwan you think over the US market and that no changes to that at all, even with you adding a lot more capacity in the States. - Yeah, that's for practical reasons. - Is it possible though to speed up how quickly that advanced tech can be shifted from Taiwan to the States? - Yeah, we can try to do that to shorten the gap. - What does that transfer gap look like then? If right now it's several years, Taiwan is ahead. What does that actually look like in the future? - We don't have a specific timeline now, but we do, we can try to accelerate that. We think we can try to accelerate. - Could it be shortened to months do you think? - It will be difficult, challenging. - Okay, so it stays at least one year behind then. - That was TSMC CFO Wendell Huang along with Bloomberg tech sound of our drivers. President Trump's call for a 10% cap on credit card interest rates since shares of financial firms tumbling this week. With bank CEOs in particular warning the move could harm the economy, not just their bottom lines. Let's talk through it. We've Shaman Alaman, co-CEO of Prometeo which provides technical infrastructure to help corporations connect to financial institutions. I find this very interesting because rate caps also may have an impact on how unsecured credit and that's the conversation right is essentially engineered. It's also about access, your reaction to the week's event. Okay, so I think that what's most striking about this news is somehow how it has shown the US commerce dependency on credit cards and credit card rails. And so we're talking about 80% of the population accessing credit through credit cards plus credit card balance being 1.2 trillion, which I think it's a very relevant number because it shows its size as the opportunity. And it's a massive opportunity. And so I think that when we talk about an limitation like this, like a restriction on an intervention on the rates, we are talking about somehow reshaping the infrastructure. We always tend to think as financial infrastructure as I give them, but it's actually designed. And what we're having here is a direct intervention and what basically forces a conversation on the underlying infrastructure and the underlying product. And the conversation is the question is basically what needs to happen at the prog level in order to meet this constraint, in order to meet this new condition, you know? And so I think that the question goes to, well, basically what's the design, you know, like what's the shape of the credit card system right now? - So at this time, right, let me just jump in, like at this time, we're also gonna wait and see if this happens, what the behavioral reaction is. So let's say that a section of the economy is close to the credit card. Well, we spoke to the Klanasiyo earlier this week, right? There's a lot of those that would talk up by now, pay later, account to account payments. Does that kind of phase out credit card reliance? - Well, I think that what will happen is that you have a 1.2 trillion opportunity, you know? And if we talk about the actual shape of the credit card system right now, it's a bundle tool. You have a payment tool plus a credit line tool, okay? And these two are combined. If we see what has happened in the payment space over the last 10 years is massive disruption, which is basically new entrance leverage in technology to provide better and most efficient solutions, more cost effective solutions, okay? And I think that that gives us a glimpse, you know, like a clue on what would happen at the credit line in a structural level, you know? Like we could expect a movement like that. And that means new entrance, very interesting, seeing the size of the opportunity jumping into the space, leveraging new technology in order to meet the requirements of this demand because the demand won't go anywhere, you know? And it's a huge demand. - Simena, it was a big week for bank earnings where we hope to find out about how banks are using AI in real terms. A lot of questions to JP Morgan about how much they're spending on AI, but what was your takeaway on the transition? How we go from like analysis to the bank's running function using AI? - Okay, well, I think that 2025 marks the year in which AI moved from being an experimentation to full deployment, you know? And I think that's very interesting. Perhaps the most popular initiative was open AI since then checkout, powered by Stripe. Definitely, we will see more of that, especially in the financial institutions, banks, landscape over this year, you know? And I think that that will bring a lot of innovation and a lot of news over the incoming year. I think that what we've seen over 2025 is AI becoming an efficient delivery. And not an innovation toy anymore, you know? And so what financial institutions banks have done is use AI internally. Initially, it was mostly tad bots. - Right. - More projects, but what we've done, what they have noticed is that basically AI can impact the main areas of the financial institution and especially for banks that have been historically very high, have had, sorry, a very high little tech stack, you know, with different parts of the bank having different databases, different technologies, different systems. AI helps all of these to come together, you know? And work as a comprehensive tech stack, you know? And so now we are seeing initiatives in fraud, in credit, of course, in middle and back office, you know? And creating efficiencies in speed, okay? And this is real-time responses to anything that an user can need. - Samantha Alaman, co-founder, Co-CIO, parameter, a great summary of the banks in the AI. Thank you very much. So does it for the addition of Bloomberg tech? What a week it's been? Recap on the pod, you know, exactly where to find it. 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