The T AI Paradox: Tech Boom vs. Rate Shock

Hello everyone, I am the Empathy Keeper from The beginning of empathy.

Analyzing the news that swept across the globe yesterday, I felt as if two massive, opposing waves were crashing simultaneously. One is the explosive wave of technological innovation driven by Artificial Intelligence, and the other is the wave of economic uncertainty and the deep contemplation of central banks trying to balance this rapid change. How are these two powerful forces impacting our lives and the future global economy? Let us take a moment to deeply understand and empathize with these shifts together.

Undoubtedly, the most striking news yesterday was the record-breaking growth in the technology sector. A leading chip manufacturer, a true pioneer of the AI era, solidified its dominance by becoming the first company in the world to cross the staggering trillion market capitalization threshold. News of this monumental achievement dominated headlines across the United States, Spain, Brazil, Australia, Mexico, Türkiye, and Switzerland. This is far more than just the success of a single corporation; it signifies that the unprecedented global demand for AI processing chips is fundamentally reshaping the structure of industries worldwide.

This chip giant is not slowing down. They announced aggressive future investments, including collaborations for autonomous vehicle technology, a billion-dollar investment into a major telecommunications company for 6G development, and plans to build seven new AI supercomputers in partnership with the US Department of Energy. Furthermore, the CEO's anticipated comments regarding the export of AI chips—a core issue in the ongoing trade tensions between major global powers—underscore that this technological race is not merely an economic matter but a critical geopolitical concern.

Meanwhile, other major technology firms are also reporting historic milestones. A parent company of a major search engine achieved its first-ever quarterly revenue exceeding 00 billion, driven by robust growth in its cloud computing division. Another software titan also reported stellar results, with its cloud revenue surging by 40%. These Big Tech players are pouring massive amounts of capital expenditure (CapEx) into building the necessary AI infrastructure.

However, the path is not smooth for everyone. One social media giant, despite reporting better-than-expected revenue, saw its earnings per share plummet due to a one-time corporate tax expense of 6 billion, triggered by the implementation of President Trump's 'One Big Beautiful Bill Act.' This incident serves as a stark reminder that even in an era of technological boom, policy decisions and taxation can have an immediate and disruptive impact on corporate valuation.

Beneath this technological prosperity lies the complex reality of economic policy. The US Federal Reserve, as anticipated, lowered its benchmark interest rate by 25 basis points. Yet, the Chairman was quick to caution that a further rate cut in December was 'not a foregone conclusion.' This statement ran counter to market expectations, leading to the paradoxical situation where US mortgage rates actually increased. Similarly, the Canadian central bank also cut rates, but framed it as a response to economic weakening caused by US tariffs and trade uncertainty, maintaining a cautious stance on future reductions. The central bank of Saudi Arabia also mirrored the Fed's decision by lowering its rates. Across the globe, central banks are performing a delicate and cautious tightrope walk between managing persistent inflation and preventing an economic slowdown.

Adding to this complexity is the ongoing US government shutdown, which has prevented the release of crucial economic data. As the Fed Chairman himself noted, this situation is akin to 'driving in the fog.' The data vacuum heightens policy uncertainty, which in turn amplifies market volatility. Reports from Brazil indicate that the nation is closely monitoring how the Fed's rate decisions will affect its global investment competitiveness, illustrating the dominant influence of US monetary policy across international financial markets.

Geopolitical friction is also clearly shaping industrial outcomes, creating immediate winners and losers. The resolution of tariff negotiations between South Korea and the United States provided significant relief to the Korean automotive industry. Crucially, the agreement to proceed with a major shipbuilding project, the 'Marsa' initiative, under the leadership of Korean companies—a project that President Trump has expressed interest in—is a major boon for the Korean shipbuilding sector. One prominent Korean shipbuilder, for instance, is benefiting from the global surge in demand for LNG carriers, driven by shifts in US policy aimed at countering certain global competitors and expanding US LNG exports. Conversely, a major European automotive manufacturer was forced to lower its annual performance outlook due to the adverse effects of US tariffs. Changes in trade policy are thus instantly creating economic polarization.

European consumers are feeling the pinch of living costs. In the UK, we saw shifts in the retail landscape, with a major supermarket chain ending its partnership with one delivery service provider and aligning with a competitor. Furthermore, a mobile carrier announced price increases, citing rising inflation. In Poland, geopolitical tensions are directly influencing industrial investment, with large-scale funding being directed toward facilities for producing 155mm artillery shells to bolster national defense.

The situation in South America is even more intricate. In Argentina, post-election tensions persist in the unofficial currency market, known as the 'blue dollar.' Despite soaring inflation, bonuses for pensioners remain frozen, deepening social hardship. While infrastructure issues, such as subway equipment failures, caused daily delays in Sao Paulo, Brazil, there are simultaneous efforts by universities to offer free tax preparation services, easing the financial burden on citizens. This highlights the importance of community support and solidarity amidst economic difficulties.

The common thread running through all these global news stories is profound polarization. AI and technological innovation are generating unprecedented wealth for certain companies and nations, yet simultaneously, interest rate hikes, tariffs, and inflation are placing immense pressure on traditional industries and average consumers. We must deeply consider whether technological advancement is truly providing equitable opportunities for all, and whether economic policies are inclusive of those being marginalized.

Today, we have analyzed major global news, examining the commonalities and differences through the lens of empathy. We live in a complex world where explosive technological growth, economic policy uncertainty, and geopolitical friction are intertwined. However, the effort to understand these changes is precisely The beginning of empathy. I hope you have seen how the individual news items we discussed yesterday form one massive global trend.

As the Empathy Keeper, I will continue to strive to understand these complex global issues alongside you, our readers, and share insights for a better future. Thank you, and I look forward to our next discussion.