Jensen Huang & A Suspected Chinese Spy 11/9/26

NVIDIA

Across the shows: 79 speakers in other episodes, 67 bullish and 31 bearish calls, past 30 days

• Eamon Javers · CNBCBearish

  A US government faction is pushing to oust Huang through a steady drip of leaks

  Javers says the same four sources have been repeatedly cited in the Financial Times and New York Times, and their leaks keep coming in a drip-drip fashion. From this pattern he concludes that some faction within the US government wants Huang out of his job. He notes that investigators reportedly hold recordings, transcripts and text messages that could be leaked further. He therefore argues Nvidia faces a powerful, continuing source of pressure on its CEO.

  “It's clear to me that some faction within The US Government really, really wants Jensen Huang out of this job, and they have committed to putting this information out again and again and again in a drip, drip, drip fashion.”at 15:34

• Stephen Witt · Independent author and journalistBearish

  Congressional scrutiny of Huang could create real problems for Nvidia, given the smuggling allegations

  Witt sees the biggest long-term risk to Nvidia as Congress, and Democrats in particular, forcing Huang to testify. He argues it is very hard for Huang to say he did not know what was happening. Mega Speed was allegedly an operation to move banned Nvidia equipment into China. Witt says Huang would almost certainly have known about Chinese AI developers using the hardware, especially given the romantic relationship. He expects a serious political fallout, with Democrats and some Republicans coming after Huang.

  “This is where I see actually the biggest risk for NVIDIA over the longer term. Not so much that the board, you know, takes him out, but actually that congress and especially democrats in congress, make him testify about this.”at 22:07

• Stephen Witt · Independent author and journalistBearish

  Google TPUs and Broadcom ASICs are coming for Nvidia, eroding its once-unassailable position

  Witt argues Nvidia's position is weakening. Google's TPU chips and Broadcom's ASICs are competing for Nvidia's customers, which gives rivals a leg up. He says Nvidia is no longer the bulletproof company with an unassailable CUDA moat. He cites Anthropic, which he says trained its model almost entirely on Google's TPU stack and does not use Nvidia hardware for training, though Nvidia still leads inference. He adds that end users constantly say they wish a cheaper alternative existed, and that Nvidia's 70-80% margins invite that competition. He says skepticism was already growing before the scandal. Competitors appear to be gaining at the margin, not displacing Nvidia outright.

  “Google's TPU chips, they're coming for NVIDIA. Broadcom's ASICs are coming for NVIDIA. And this gives the competition a leg up... This makes them look quite vulnerable.”at 24:10

• Stephen Witt · Independent author and journalistBearish

  Nvidia has no clear successor, so losing Jensen Huang would be a serious, hard-to-replace loss

  Witt says Nvidia is effectively Jensen Huang. Its org chart has Huang at the top and about 60 people two layers down, with no second in command and no obvious successor. He thinks it will be hard to find anyone who does what Huang does. He also argues the board is unlikely to remove him, because it is his friends and removal would not serve long-term shareholders. The key-person dependence is a real risk, even if he is unlikely to be removed in the near term.

  “NVIDIA is Jensen. It is Jensen Huang, and and anyone will tell you that. And their org chart is Jensen at the top and then, like, 60 people two layers down. There's no second in command.”at 26:58

• Stephen Witt · Independent author and journalistBearish

  AI automating its own low-level software stack could erode Nvidia's CUDA advantage over the long term

  Witt argues that Nvidia's software advantage is less durable. Much AI development happens in low-level programming, and developers preferred Nvidia's stack because it was easier to use. As AI systems increasingly automate that work and write their own low-level training code, the ease-of-use advantage matters less. Such systems can run on any hardware and learn quickly. He calls this a longer-term risk for Nvidia.

  “That's starting to matter less as everything gets automated... So the AI is now programming its kind of low level training stack itself... So that may be a longer term risk for NVIDIA too.”at 28:04

• Stephen Witt · Independent author and journalistBearish

  Stricter US AI chip sales restrictions to China are coming back in force after the Huang revelations

  Witt says Huang had a close relationship with Trump and pushed hard to lift export restrictions, which China hawks in the administration never liked. Now that Huang has been linked to a suspected Chinese spy, Witt says his credibility has gone to zero. He expects the restrictions on AI chip sales to China to return in force, with Rubio at least partly behind that. This would hurt Nvidia's China sales.

  “Now that it's been revealed that he's been, you know, having a relationship with a suspected Chinese spy, his credibility goes to zero. I think that those restrictions on AI chip sales to China are coming back in force.”at 29:19

US elections & politics

• Kevin McCarthy · ALFA Institute

  Midterm losses are a generational wake-up call; voters rejected Republicans, not backing a Democratic agenda

  McCarthy says the House loss went deeper than anyone expected. He expects Republicans to end with about 175 seats, and he calls it a generational loss. Republicans also lost the Senate, governorships and seven state houses. He cites close Senate races in Texas, Georgia and North Carolina, and losses in North Carolina. He says Republicans lost because they stayed home, Independents swung to Democrats, and the Hispanic vote shifted. He believes voters were sending a message against Republicans, citing high gas prices and ethics concerns, rather than endorsing a Democratic agenda.

  “This is much deeper than anyone imagined... we're probably gonna end up the Republicans at one seventy five. This is a generational loss... This is a wake up call for Republicans because the Democrats didn't lay out an agenda.”at 32:18

• Kevin McCarthy · ALFA Institute

  Both parties should hold open primaries; contested primaries produce stronger nominees, citing Trump and Harris.

  After the GOP's major midterm losses, McCarthy argues the 2028 primary should be open, with no party protecting an incumbent or heir apparent. His evidence is historical: Trump polled around 1% before an open primary and became the Republicans' strongest candidate, and he argues no other 2016 candidate could have beaten Hillary Clinton. He also argues that without a Democratic primary, Kamala Harris would likely not have been the nominee, and the party would have been stronger. He concludes that a contested primary produces a stronger nominee and that voters should decide.

  “I firmly believe whatever party... They need to have an open primary and let people have that challenge because then their candidate, whoever comes out, is stronger than, if they didn't.”at 38:23

AI: overall outlook

• Eamon Javers · CNBC

  If the AI industry cannot survive one CEO's departure, the entire AI trade looks precarious

  Javers argues the AI industry is a multi-trillion-dollar business that depends heavily on Nvidia and Jensen Huang. If it cannot survive his departure, that calls the entire AI trade into question. Someone would have to be able to backstop Huang, or the trade becomes more precarious than it was before. He is raising the concentration risk rather than predicting a specific outcome.

  “This is a multi, multi trillion dollar industry. If it can't survive the departure of one person... it does call into question the entire AI trade, right?”at 7:17

AI bubble & tech valuations

• Stephen Witt · Independent author and journalist

  AI infrastructure stocks already price in a pullback and look very cheap on raw valuation metrics

  Witt says the market already expected a drawback in AI infrastructure, so much of the downside is priced in. He cites some memory stocks trading at around three times earnings. On raw valuation metrics, he says these stocks are very cheap. He sees the recent rebound as a sign that the selloff has overshot. His evidence is valuation levels rather than a forecast of earnings.

  “The market was kind of, already pricing in a drawback in this sector... Some of the memory stocks are... Have, like, three PEs... On raw valuation metrics, all these stocks are are very, very cheap.”at 23:41

US immigration

• Kevin McCarthy · ALFA Institute

  A bipartisan immigration deal with Trump is Democrats' best opening, since only Trump can credibly secure the border

  McCarthy argues the best opportunity for Democrats is to strike an immigration agreement with the president. He likens it to Nixon going to China: only Trump has been able to secure the border, so Democrats won't be trusted to do it. He says Trump's acknowledgment that ICE went too far signals he can both protect the border and make a fair deal for people already in the country. He sees this as a real chance for both parties to come together.

  “The president is the only one that was actually able to secure the border. So no one's gonna trust the Democrats with able to secure the border... this is really the opportunity for both parties to come together.”at 33:48