AI Is the Real Deal for Investors—if You Understand It. Our Roundtable Is Here to Help.
21 min
It has been less than a year since OpenAI changed the world overnight with the release of ChatGPT. Since its November launch, the chatbot’s display of generative artificial-intelligence software has triggered a reshuffling of investment priorities in Silicon Valley, on Sand Hill Road, and on Wall Street. Almost every company—and this goes well beyond tech—has prioritised the development and adoption of generative AI.
The notion of artificial intelligence, or computers that can “think,” has been around since the Cold War. What makes generative AI so fresh is the ability to answer questions posed as simple natural-language requests—and respond with rich, creative content in the form of text, music, video, images, or even poetry.
Generative AI promises to democratise the power of large data sets, making it dramatically easier for people and businesses to find information, create content, and analyse data. And yet, AI isn’t magic, despite all appearances to the contrary. The technology is creating widespread worries about the misappropriation of personal information, the misuse of copyright-protected content, and the creation of false and misleading data. Some people even see AI as an existential risk to the future of life on Earth—a recent Time magazine cover asked whether AI will eventually lead to “The End of Humanity.”
To consider the outlook for AI, how it works, where the risks lie, and who will lead the way, Barron’s assembled a panel of five experts who approach AI from divergent angles. Our AI roundtable panelists included Dario Gill, director of research at IBM, which has spent decades working on artificial-intelligence software and hardware; Irene Solaiman, policy director at Hugging Face, a marketplace for AI models, data sets, and software; Cathy Gao, a partner at Sapphire Ventures, which has committed to investing at least $1 billion in AI-focused start-ups; Mark Moerdler, a software analyst at Bernstein Research who completed a doctorate in computer science and artificial intelligence in 1990; and Brook Dane, a portfolio manager at Goldman Sachs who lately has revamped his investment strategy to focus on AI stock plays.
The conversation took place in early August on Zoom. An edited version follows.
Barron’s:Let’s start by framing just how big a deal generative AI is. The biggest thing since the Web? The iPhone? Electricity? The wheel? Dario, IBM has been working on AI for decades—it has been 12 years since Watson’s famous appearance on Jeopardy. So, what has changed?
Dario Gil: IBM has actually been involved in AI since 1956, the year of a famous conference we co-sponsored called the Dartmouth Summer Project on Artificial Intelligence. Arthur Samuel, an IBM computer scientist who did pioneering work in AI, coined the term “machine learning” in 1959. So, yes, the idea of AI has been around for a long, long time. The past decade or so has been the era of deep learning and neural networks, where we discovered that if you could label enough data, you could achieve superhuman levels of accuracy.
But that turned out to be extremely expensive.
Gil: Right. There were only a handful of institutions that could actually amass enough labeled data—say, hand-tagged photographs—to generate good value and a reasonable return on investment. The fundamental reason why there’s so much excitement around AI now is this transition toward “self-supervision.”
Explain that for us.
Gil: The advent of foundational models—the basis of generative AI—allows us to take large amounts of unlabelled data and create very powerful representations of language, code, chemistry, and materials, or even images. And as a consequence of that, once you train these models, the downstream use cases allow you to fine-tune or prompt or engineer them with a fraction of the energy, effort, and resources that historically would have been required to create those use cases. It’s what is unlocking this productivity moment in AI.
Bill Gates has said that ChatGPT was the most impressive technology he’d experienced since he first saw a graphical user interface in 1980—that it was as fundamental as the creation of the microprocessor, the PC, the internet, or the mobile phone. Nvidia [ticker: NVDA] CEO Jensun Huang says AI is having an iPhone moment. Cathy, Sapphire just announced a commitment to invest $1 billion in AI start-ups. Does this moment really feel that big? What is the opportunity that Sapphire sees?
Cathy Gao: In AI, we invest end to end, in everything from the plumbing to how data move through the stack to the application layer. With AI, we are definitely seeing a similar arc to other platform shifts. We believe that this is a significant platform shift. We’re in the early stages of that explosion, headed ultimately to ubiquity.
But why now? What makes this the moment?
Gao: It’s being driven by many things. One of the keys is that the consumer imagination has been captured. ChatGPT reached 100 million users in a groundbreaking two months. You can see a future where AI becomes so ubiquitous that companies no longer market themselves as “AI companies” because they’ve all become AI companies. In part, this is about ease of use, the ability to leverage foundational models via API [application program interface, a protocol for software programs to connect], so you’re not having to rebuild them every time. You’re not having to build these LLMs [large language models] from scratch. And the other element is the end-user experience, which will take us to the next phase of ubiquity.
Mark, you earned a doctorate in artificial intelligence a few decades back. What’s different now?
Mark Moerdler: It feels like 100 years ago. We were learning how to do very basic things with AI. Since then, we’ve seen massive improvements in technology. Underlying computing capabilities have massively expanded. You couldn’t run the types of learning models that you can do today, because the computers couldn’t deal with that capacity. We were using far smaller computers, with less memory, storage, and bandwidth.
And I would agree with Cathy that this is all about conversational AI. Until now, it’s all been under the hood. Now, you can hold a conversation with software in the same way you might talk to a person, and the system will respond to you, maybe with a report, or by creating an image, or simply with an ongoing conversation.
This was all sparked by ChatGPT and a consumer experience, natural-language chat. Will consumers—and advertising—ultimately be the revenue source for this business, or will it be more about a growing market for enterprise applications?
Moerdler: Some of the largest companies in the world—including Microsoft [MSFT] and Alphabet [GOOGL]—are involved in both consumer and enterprise AI software. There will be disruption on the consumer side, in terms of where you search for information. But arguably, the bigger value creation is going to be unlocking the data within enterprises, to leverage that data to drive efficiencies within organizations, make leaps of intuition in coming up with answers, or make decisions faster, or in some cases reach conclusions you couldn’t previously reach because you didn’t have easy access to the data.
Gao: What’s happening in Gen AI on the consumer side and the B2B—or business-to-business—side are highly symbiotic. They’re feeding into each other. There is a huge opportunity for enterprise software companies today, and that’s why you’re seeing a lot of investment. Gen AI is the ultimate double-edged sword. On the one hand, it represents tremendous potential to be transformative, and the key to future growth. But it can also create new competition that could be hard to beat, in some cases creating existential risk for the incumbents.
Gen AI can increase the addressable market for many companies and industries. Take a core system of record like ERP, or electronic medical records, or a payroll service like ADP, which stores a lot of valuable data. Often, the existing customer interface layer limits many potential use cases. Gen AI can be used to reimagine and reinvent workflows, and to open up the addressable markets in a significant way.
Irene Solaiman: It’s important to step back and think about what systems we are discussing, because there are so many language models out there. When we’re talking about generative AI, the way you would do research on or adapt them to a given application is going to different by modality. There’s a lot of chatter around chatbots, but there’s a lot happening with imagery and audio and even video that isn’t the subject of as much research or literature as there is for language. There’s so much opportunity.
Remember, also, that these base systems often aren’t developed for a specific use case. They may be optimized for tasks like code generation. But generally, they can be applied to many different fields, which is exciting. There are also risks; we need to figure out what safeguards we need.
Irene, I was visiting the Hugging Face website and was struck by the number of models and data sets your site offers. This isn’t just about Microsoft, Meta Platforms [META], or Alphabet.
Solaiman: We have almost 300,000 different models, over 100,000 applications, and more than 50,000 data sets. Not all of the models are focused on natural-language processing. There are models for more-specific fields, like biomedical AI. There’s a lot of discussion around advanced models like OpenAI’s GPT4. But that’s not what everyone is going to use. Large language models are computationally expensive to run. At Hugging Face, we’re seeing a lot of researchers use much smaller models that are cheaper to adapt and fine-tune.
That raises questions about where the value lies—and who the winners will be. Brook, it’s your job to identify AI winners. Do you see the value going to those that have the data, or the application vendors, or someone else? How do you approach that when looking for AI-related companies in which to invest?
Brook Dane: It’s incredibly early in this journey, especially when you look beyond the providers of semiconductor and networking infrastructure, like Nvidia, which has a near-monopoly on graphics processors used to train models. When you think about the software layer, it is TBD—to be determined—on some of these things. Early on, though, it appears that this idea that data have gravity and will be the source of competitive advantage appears to be true. We’re focused on that.
Beyond infrastructure, we are spending the bulk of our time on data, and which players can drive value and capture value over time. The other issue is that, unlike some other big tech transitions of the past, you don’t have to rewrite the entire software stack. In other words, I wonder whether there will be as much disruption to the leaders in the marketplace as in previous shifts. The shift to mobile and the internet created a whole new class of companies that rose up and displaced the incumbents. I wonder if this time the incumbents will actually reinforce their power, because they already have the data.
Moerdler: I agree. The speed of building models is very high. We’re talking months, not years. It’s just a matter of money. Differentiation is going to create sustainable value where you can create something trained on unique data and capabilities—and where the uniqueness is sustainable. In traditional software, the moat was created because it took so much time to create the technology. For a competitor to catch up took a really long time. Here, everyone is building capabilities. If you can’t differentiate, you aren’t going to be able to monetise it.
We’ve talked a lot about models and data sets. What differentiates the two?
Moerdler: When people talk about models, there are several types. There are generic models trained on very large data sets, for the purposes of answering more generalised queries, like ChatGPT and Bing. There are specialised models for very specific problems—say, in chemistry or materials sciences. And there’s an enormous amount of data sitting inside companies. Companies may choose to use a more generic model and ground it with their corporate data.
Gao: Let me give you an example to illustrate what Mark is saying. One of our portfolio companies, MoveWorks, is an AI chatbot that cuts across enterprise applications like information technology, service management, and human resources, and adds company-specific data. If a customer has a conference room called Taylor Swift, for instance, and you ask a public chatbot if Taylor Swift is available at 9 a.m., the model is going to get confused. But if the chatbot is infused with information about the company’s conference-room names, it can produce an accurate answer.
Gil: The pattern of consumption is essential for how AI is used in the real world. So, you start with your base model, and then you load your records of, say, past customer exchanges and service documents around that—you’re fine-tuning the model so it incorporates your local data. Productivity gains are linked to that idea. Once you have base models for solving IT problems, all of a sudden your internal team can do 50 or 100 projects a year. In the era of just deep learning, having to label everything by hand, where every model was custom, you could do just four or five projects.
Solaiman: I always use the term “system” instead of model. But I’m so glad to hear all this talk about data. And when we’re thinking about system life cycles, there’s a lot of work, as Dario was saying, that goes into data collation, curation, and governance. An organization is going to train on an open data set that may have been collated and curated by somebody else.
This brings us to the question of why this is all happening now. We have much more impressive systems than we did just a few years ago. We have better techniques and better infrastructure, including more efficient computing, more computing, and more data. And we have better safety research, better fine-tuning of the information, and better accessibility, not just via APIs, but with models that are more compute-efficient, that can run even on local hardware.
In an interview with Barron’s after the latest Palantir [PLTR] earnings call, CEO Alex Karp said that this technological revolution favors the incumbents—unlike previous tech disruption that advantaged new companies. He thinks the winners will be familiar players, not new ones. Brook, you already touched on this idea. Cathy, as an investor in new companies, do you find that discouraging?
Gao: That’s the No. 1 question. Look, the incumbents have scale and capital. They have the computing resources, which are scarce these days. And they have tremendous data. They have key ingredients to be very, very successful around Gen AI. The incumbents are certainly going to be playing an outsize role in this era. I’m talking about hyperscalers, such as Google, Amazon.com [AMZN], Microsoft, and others, that are aggressively investing in this technology. On its latest call, Microsoft mentioned AI 59 times.
That’s even more times than the 53 times that Microsoft said the word “cloud.”
Gao: For an investor like me who is looking for the disrupters, the biggest question—and the biggest risk—when you look at most Gen AI application software companies is, what if Microsoft, or Google, or Adobe [ADBE] does this in the future? Is this new company going to be wiped out? The differentiators will be the same as with any software-as-a-service application. It will be about customer and product experience being deeply embedded into workflows, and that data moat that we talked about earlier.
A lot of the founders I’ve been speaking to over the past couple of months, when asked about Gen AI suddenly blowing up in the past two quarters, always say the same thing. They say, on the one hand, that it has been amazing for the market, with inbound queries just flooding in. But at the same time, it has lowered the barrier to entry for new players. Plus, the hyperscalers like Amazon, Meta, Alphabet, and Microsoft are now paying more attention to this opportunity.
Dane: I agree with everything Cathy just said. In every transition, new companies emerge, and some become large. But there really is a power of incumbency here, because of the need for data, and because you can develop these tools and techniques relatively quickly, the way Microsoft has announced AI software across its software stack. The incumbents do have a huge advantage. It’s going to come down to leadership and execution, as it always does, and especially in a time like this when the market has been through a period in which it has been focused on margin expansion. There’s a level of investment required to do this, and some of the incumbents are going to hesitate to spend what they need to spend to be relevant players. But the advantage starts with incumbency on this transition.
Mark, do you agree?
Moerdler: Yes, but let me add to that. AI is a data-driven learning experience. The more you have access to data, theoretically, the better your product becomes. And therefore, the quicker you can get to market, the more you can absorb in terms of information, the broader the reach—it has somewhat of a self-fulfilling prophecy effect. But as Brook rightly said, it comes down to execution, and there are many companies now that are giving lip service to generative AI rather than the significant focus and investment that may be necessary to create a moated solution.
Dane: As I think about my models and forecasts across the software ecosystem, the ones that execute well in this are going to see a lower churn rate, higher customer retention, and higher upsell and cross-sell into their installed base. You’re starting to see companies for which your degree of confidence in the two-, three-, four-year-out free-cash-flow outlook is structurally higher now. All of this is still super-early, and I’m not sure that it impacts the next 12 months’ cash flows in any material way. But as I think beyond that horizon, I get increased confidence in their ability to be bigger, stronger, faster businesses.
It seems clear that we’re not talking just about the importance of data held by tech companies. Legacy companies in areas such as financial services, pharmaceuticals, and materials have tons of data, too.
Gil: Understanding the moment as a shift in data representation is really important. It may sound a little bit abstract, but it is profound. When the relational database was invented, there was a form of data representation that we’re all accustomed to, of rows and columns. Databases were invented to do that well, transaction processing systems do that well, and it had huge implications for payroll and finance and accounting. Now, imagine instead a graphical data representation. It turns out that graphical representation is essential to do things like search, social media, and so on. You’re going to take the data that you have today, relational databases, graphs, and so on, and map them to this new way to encode information.
So, who gets to be a value creator? Enterprises and governments the world over have the most data. It looks at the moment like all of this is concentrated in about five American companies, but that isn’t how the future is going to evolve, because contrary to popular opinion, and thanks to open-source initiatives, the democratisation of AI is perhaps the most important force at present. Understanding how much simpler it will become to take advantage of these large language models, to adapt them, to create them, will turn out to be the defining trend as it gets internationalised and democratised, and value creation gets more distributed.
Solaiman: That’s one of the reasons I do this work. What we’re building has a lot of potential, but potential for whom? For instance, what are most keyboards optimised for? Latin character alphabets, like English. When I worked at OpenAI, I used to test a lot of the models, not just in English but also in the only non-Latin character language I understand, which is Bangla, the national language of Bangladesh. I got to see Bangla-speaking researchers working in a language deeply underrepresented in natural-language processing. When you make systems work for many different groups of people, opportunities open up. The question from a governance point of view is, how do we make sure data collection isn’t exploitative and appropriately represents every community.
That brings us to an important topic, which is regulation, and mitigating risks and potential harms. There are questions around job loss, intellectual property protection, and deep fakes. Congress has held hearings. Do we need a new regulator? New rules? And how do we do that without reducing the competitive position of U.S. companies relative to those in China or elsewhere?
Moerdler: We’re in a new era. Regulators don’t necessarily have the experience in this area. They are learning as the rest of us are learning exactly how to deal with it. Regulation, like everything, can be a two-edged sword. It can be used to limit bad actions. It could also limit development. There needs to be control to assure governance, privacy, and security, that the systems aren’t misused by bad actors. There needs to be some level of standardization of requirements, of control, and maybe even regulation. But it has to be done in a thoughtful way, or what will end up happening is that you will create an opportunity for companies outside the U.S. to take market share and take advantage.
Irene, what is your sense of this?
Solaiman: Good regulation is hard to do. Regulators wear so many hats. They can’t be experts in AI. But what they are experts in is the public interest. I want to learn from policy makers in which direction they think AI should be going. But it is immensely difficult to regulate. And what systems are we actually talking about? There’s not one single piece of legislation that is going to affect every aspect of AI. Regulators in the U.S., the European Union, the United Kingdom, and Canada are trying. There is an unprecedented level of attention in Congress. Hugging Face is pro regulation, but we want that to be in a way that guides innovation in the right direction. There needs to be better standards, but that means working together closely. There are incredible experts throughout all of these regulatory bodies on what that would look like and how that can be extrapolated to non generative AI systems, as well.
Gil: A framework of precision regulation would serve the industry well. Look at the work the EU did in the past few years. They developed a very thoughtful approach on use cases and risk-adjusted regulatory frameworks. There’s a huge difference between applying AI in a nuclear reactor and applying AI for a pizza-recommendation system. Right? And so risk-adjust, where you categorise how much harm this is likely to cause, or how much risk this is going to induce in society, and use the appropriate regulatory bodies to beef up the expertise.
Enable every agency to become an AI agency, an additional element that they incorporate. This is in contrast to having a single AI regulator that is going to figure out the whole thing. Regulating the technology itself, regulating mathematics, is a really bad idea. And there are people talking about registering the models—that’s the wrong way to go.
Focus on the use cases. Focus on the harm and the impact around that, and regulate using existing bodies against those by beefing up their AI knowledge and expertise and sophistication. Sometimes, the hyperbolic rhetoric that has come even from the tech industry is causing more harm than good. Lowering the tone and focusing around the harm and the damages and the impact, and on those regulatory bodies and the people who are doing that, would be the right way forward for precision regulation.
Cathy, how does the risk of added regulation affect your thinking about where to put Sapphire’s money?
Gao: It’s something we consider closely. We’re still in the very early innings—there are a lot of unknowns. Venture capital is a high-beta asset class by definition. But we want to be smart about the risks we take. When it comes to AI, many of the use cases we’re looking at right now are less likely to be a target of regulatory scrutiny. We’re not looking at companies that affect life or death, like in healthcare. Still, we’re following it very closely. We definitely take that into consideration, but we also accept that some of the unknowns will remain when we make an investment.
Moedler: These systems could be problematic from a privacy point of view, from a bias point of view, from an intellectual-property point of view. Investors need to think through where they could be exposed. It may not be regulators. It may be the fact that, you know what, you trained up these solutions, and the responses they’re giving impinge on other people’s IP, and therefore your clients—and you—are going to get sued. That becomes part of the math you need to do when determining whether these systems are going to become good, sustainable businesses that will generate not just revenue, but also profits, over a long period. Investors need to think carefully about where the exposure can be, whether they’re going to cross a line or create some legal, regulatory, or economic exposure.
One other risk that has been widely discussed is the potential that AI will cost people jobs. Is AI going to be a net job creator—or destroyer?
Gil: We have a couple of hundred years of evidence that the nature of jobs changes over time. A hundred years ago, half of the U.S. population was working in the fields. So, first of all, this phenomenon isn’t new. Whenever really disruptive technology emerges, people think this time will be different. The evidence suggests that won’t be the case. There’s a lot of good analysis that jobs are composed of many, many diverse tasks, and some will be subject to automation while many others won’t. The key metric that people are focused on is whether we can deliver on the productivity promise. With better productivity, we can generate more wealth, and invest in things we care deeply about to create better institutions, a better society, and so on.
I’m more worried about whether we can deliver solutions fast enough to reach the productivity gains we need, and discover solutions to the problems that we face. When I talk to people about advances in AI, semiconductors, and quantum computing, and they are stressed out about the rate of technological evolution, I like to say, look around. I don’t think we’ve run out of problems to solve. And if we can use these technologies to accelerate how quickly we can discover some of these solutions, we are all going to be very well served. One of my fears is definitely not that people won’t have jobs because of the advances in AI. History tells us that.
Solaiman: Just five years ago, one conversation was around how autonomous vehicles would replace drivers and cost the jobs of truck drivers and others. But it turns out, the most adversarial environment is the real world. I’d like to see more research on how we augment and not automate. What will be the impact on the wage distribution? Should people’s wages be reduced if they’re being helped by AI? There are important economic questions.
OK, we have to discuss the notion that generative AI is an existential threat to humanity, as some have warned. It’s worth mentioning here that there’s a difference between generative AI—what chatbots do—and artificial general intelligence, or AGI, the idea that software can be sentient and act on its own, like HAL in the movie 2001: A Space Odyssey.
Gil: I’m very opposed to that language of existential threats because it distorts things in a significant way. First of all, it freaks out our fellow citizens. To some degree, some of the people who espouse that language are behind the scenes aiming at regulatory capture.
Solaiman: A fun fact about me that’s not very public is that I worked on AGI for a while. When I was working on that, a lot of what I was thinking about through my research was, if we’re building these incredibly powerful systems, whose values do they represent? My primary motivator now is to make AI systems work better for underrepresented people in the technical world. A lot of the harms to marginalized people truly are existential to those communities.
But we’re not going to be serving robot masters soon, right?
Moerdler: The more immediate issue is how the AI is used and misused, not whether the AI itself is going to decide to cause damage. That’s the crux of the issue. Worry about how it’s going to be used or misused, because it’s a long time horizon before you have to worry about AI making decisions. People are trying, as Dario said, to blow this out of proportion for other purposes.
Let’s take a few minutes to talk about AI stocks. Brook, when we last talked a few months ago, you walked me through a bunch of non obvious ideas for AI investments. Are you still finding attractive things to buy, despite a big rally in the stocks?
Dane: First, as I’ve said, it’s very early. We’re in the emergence of this technology right now. The landscape is going to change dramatically over the next one, three, five years. Investors have to pay attention to how these things are changing and where opportunities emerge. The second thing is that, in general, there’s going to be considerable differentiation between winners and losers. Right now, the obvious plays are the ones getting revenue today, the picks-and-shovels players, semiconductor components, and networking, and then the big cloud vendors.
We’re at a funny moment, though, where the market has realised that there is going to be a boom in applications, and that there will be a bunch of infrastructure software that gets pulled along with this. There are exciting opportunities, but that isn’t going to move numbers for calendar-year 2023. So, as long as your investment horizon is long enough, you’re likely to see the payoff from this. If you’re trying to manage a portfolio from now to the end of the calendar year, the companies that are seeing the benefit are the very obvious choices that have already moved, like Nvidia and Microsoft and Alphabet.
When Microsoft reported June-quarter earnings a few weeks ago, the market’s reaction was a little tepid. The results didn’t really reflect all of the things they have been saying are coming on the AI front.
Dane: As we’ve moved through this latest earnings period, you saw a lot of companies produce results that have been ahead of expectations or right in line with expectations. Nobody has particularly gotten aggressive about raising guidance, and stocks have sold off into that, because they had large moves into the end of the quarter through June and July. People were expecting some excitement. The excitement is coming in a lot of these names, but just not in the next 90 days.
Microsoft seems incredibly well positioned from our perspective, given what the company is doing with Copilot and Azure. For us, that seems like a compelling opportunity.
Give us a couple of other picks.
Dane: I’m bullish on Marvell Technology [MRVL], which makes chips used in data-centre networking. It will grow right alongside Nvidia. Its AI-related business is around $200 million in revenue, and should double in each of the next couple of years. The stock has moved up, but so have estimates. This is a picks-and-shovels play, where the numbers are going higher.
Another company we like is Adobe, which dominates the creative software market. We’ve been hearing good things about the beta test for its corporate version of Firefly, Adobe’s collection of generative-AI tools. From what we hear from the sales channel, the beta version is doing exceptionally well. One of the biggest advantages that Adobe software offers is that customers will be protected from copyright infringement for their text-to-image software. There’s a little bit of TBD around how big this is—we still don’t have pricing information—but this is one of those situations where the incumbent has an advantage.
And what about Nvidia?
Dane: We have owned it and continue to own it in our large-cap and tech-focused funds. But we’re always managing risk and reward with position sizing; you want to make sure you stay in balance. As the leader in graphics processors, they are in a unique position—they are really benefiting from this wave. The business will do exceptionally well, but valuation has a range of outcomes.
Mark, you wrote a piece recently that asked if we are in an AI bubble. Are we?
Moerdler: We’ve been in an expectation or optimism bubble. The investor community has gotten enthusiastic about the near-term revenue that’s going to be generated by the technology. Again, this technology exploded on the market. Investors looked at it and went, OK, it’s going to generate meaningful revenue in a relatively short period. Expectations moved up, and valuations moved up accordingly. Many management teams started talking about their AI solutions. You could literally watch stock valuations move up the more they talked about AI, even though they weren’t giving you any guidance about when and how much. We’ve seen multiples move up to relatively high ranges, approaching what we’ve seen at peak multiples in recent times, without that line of sight to the revenue-generation possibility.
And so from that perspective, there is a bit of a bubble going on. It’s going to take longer than many people believe for AI to drive meaningful revenue. That doesn’t mean no revenue, but enough to move the needle from a revenue growth perspective or an earnings perspective. It is likely that in most cases, revenue is going to lead earnings here because there’s a lot of investment required to offer AI tools. You’re using them in the cloud. You’re paying for that usage, even if you own it yourself. You’re probably paying a premium right now, because of the GPU [graphics processing unit] shortage. And so, yes, we got a little bit ahead of our skis.
I also don’t think the rising tide will lift all ships equally. It’s going to come down to the companies that are able to create differentiated capabilities, protected against competitive threats—and that have the ability to monetise them. A lot of companies are going to add AI capabilities, and it is going to be, at least in the near term, a cost of doing business. It isn’t going to be monetisable because your competitors are going to add similar capabilities.
As Brook discussed, you need to think about the time horizon. We think of three buckets. There are the companies where you can see differentiation in what they’re offering now. There are companies that are adding AI, but it may just mean a higher cost of doing business, at least for the near term. Longer term, years from now, it could become real. And then there are the companies that will be disrupted. Most companies are in that middle bucket today.
Which companies would be in the first bucket? And the last?
Moerdler: Two of the companies that I put in the winners bucket were just mentioned by Brook—Microsoft and Adobe. I put in the losers list companies offering no-code and low-code software solutions; they are going to face new competition from AI-written code. For the losers, we see a combination of increased customer attrition and pricing pressure. Almost everything else is the middle bucket. For most companies, generative AI won’t be a major differentiator but will be necessary from a competitive positioning perspective. Most of these are jumping on the AI bandwagon, and while they should be able to get functionality to market quickly, it won’t be differentiated and, in many cases, really valuable to customers.
Dane: One thing to note: The opportunities in tech companies are compelling right now, with AI as an option in front of them. Business fundamentals are largely stable. The economy is in better shape than we all thought it would be six or nine months ago. These companies have largely pivoted to driving cash flow and operating income instead of chasing growth for growth’s sake. And then you have this optionality around AI.
Moerdler: Agreed. If your focus is on the value of the business, and the upside from AI, you’re going to get better a risk-reward in terms of your investment profile than if you jump on the all-about-AI ship, because it may just take longer until that revenue comes to fruition.
While tech stocks have had a big year, and everyone is talking about AI, there haven’t been any AI initial public offerings, or really any IPOs in tech. Cathy, what does that say about where we are in the development of the AI sector?
Gao: When the general IPO markets will unfreeze for tech is the million dollar question. I have no idea. In any case, it’s going to take a while before we see pure-play AI companies come public. The speed of adoption that we’re seeing in this cycle with AI has outstripped anything that I’ve seen in prior platform shifts. But maybe there’s something we can learn from the internet revolution that could be applied to the current era. In the internet era, the first wave of companies that came out weren’t the ones that ultimately succeeded. It was more the second wave and the third wave that watched their predecessors, learned from their mistakes, refined, rehoned, and went out. My gut is telling me that this is going to take a while.
Everyone, thanks for a fascinating conversation.
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Nvidia delivered another blockbuster quarter, beating expectations across revenue, guidance, and data centre growth, yet the market reaction remained surprisingly muted. As the AI boom matures, investors are beginning to look beyond GPUs toward the broader compute stack, including networking and CPUs, where rivals like Intel and AMD are gaining momentum. The message is clear: AI’s growth story is far from over, but the list of winners is starting to expand.
Rising global bond yields and uncertainty around the US Federal Reserve are increasing market volatility, as investors reassess inflation risks, interest rates, and global economic conditions.
Kuwait’s Heavy Engineering Industries and Shipbuilding Co. (HEISCO) has renewed a KD14 million ($45.4 million) credit facility agreement with a local bank to support its operational activities, marking the company’s second facility renewal this month following an earlier KD96.06 million agreement. The engineering and shipbuilding firm has also continued expanding its project portfolio in 2026, including securing a $565 million contract from Kuwait Oil Company in April.
Stablecoins are increasingly being positioned as the future of digital payments, promising faster and more efficient transactions than traditional banking systems. But as governments move to regulate the sector and bring crypto further into the mainstream, concerns remain over financial stability, market fragmentation, and the risks tied to privately issued digital money. With adoption growing globally, the debate is shifting from whether stablecoins will survive to how they can be integrated safely into the broader financial system.
4 min
“Private money” sounds like an oxymoron. Surely the currency on which our economy runs is the epitome of a public good?
In fact, the U.S. has had private money before, in the 1800s. And private money is now making a comeback, in the form of stablecoins: cryptocurrencies intended to maintain a fixed value against the dollar.
To proponents, stablecoins are crypto’s killer app. They will make payments faster and more efficient, especially across borders, than the legacy banking system makes possible.
With that promise, though, comes the risk that this could lead to a financial crisis, much like some past experiments with private money.
Both the Genius Act, signed into law last year, and the Clarity Act now making its way through the Senate, aim to make stablecoins safer and more mainstream. But no legislation can fully remove risk that is intrinsic to the design of stablecoins.
Stablecoin issuers and affiliated platforms are private enterprises driven to increase usage and profit via the assets they hold to back their coins, the “rewards” they pay to users, and the sorts of activity they tolerate.
Of course, profit and risk-taking are core to how all innovation happens, and that’s a good thing. In finance, though, innovation routinely leads to excesses that can lead to a sudden loss of confidence, runs and contagion that spills over to the broader economy.
What is money?
Money serves several purposes: a store of value, a unit in which to price transactions, and a medium to carry out those transactions. U.S. dollars meet all these criteria. Today, the Federal Reserve controls the issuance of dollars.
But nothing bars private actors from trying to create their own versions of money. Crypto long aspired to be just that. But the first cryptocurrencies such as bitcoin weren’t backed by anything, and thus their value fluctuated wildly.
Stablecoins back themselves with tangible assets such as Treasury bills that can be sold to redeem coins one for one for dollars. CoinMarketCap puts stablecoins outstanding at roughly $300 billion, led by Tether ($190 billion) and Circle ($76 billion).
Stablecoins promised the best of both public and private money: as interchangeable and reliable as dollars but, thanks to the blockchain, faster and cheaper than the dollar-based banking system.
But that promise embodies a contradiction. “Stablecoins attempt to import credibility from public money while operating outside the established settlement system,” Pablo Hernández de Cos, general manager of the Bank for International Settlements, noted in a recent speech.
An essential quality of money is “singleness,” meaning a dollar must always equal a dollar no matter when, where or with whom it is used. Bank deposits are a form of private money, but because banks can borrow from the Federal Reserve to redeem deposits, and dollars move between banks via the Fed, their dollars exhibit singleness.
By contrast stablecoins move through proprietary, fragmented infrastructures. They don’t exhibit singleness. Though coins issued by Tether and Circle are intended to stay fixed to the U.S. dollar, they often deviate from that value, albeit usually by tiny amounts.
Unlike the Fed, stablecoins seek to make a profit. One way is by expanding usage, such as by paying interest, as bank deposits do. The Clarity Act would prohibit payment of deposit-like interest, but permit rewards based on usage.
Historically, crypto has pushed the legal envelope, and may design rewards to mimic interest without violating the law. “I don’t see any reason they’d completely change their tactics and become conservative about interpreting the law when that has not been the pattern thus far,” said Molly White, who writes the Citation Needed newsletter on crypto and technology policy.
Stablecoins also have an incentive to “reach for yield,” that is to back their coins with slightly riskier or less liquid assets with higher returns. But if those assets’ value declines, stablecoins may not be able to maintain par value. Holders could rush to sell or redeem, triggering forced sales of the assets and spillover to other markets, even banks.
Last year’s Genius Act requires stablecoins that cater to Americans be backed with safe, liquid assets such as treasury bills and bank deposits. But Fed governor Michael Barr noted last year the law has loopholes. The bank deposits may be uninsured. The law allows stablecoins to receive money, including foreign money, through “repo” loans, and that could include bitcoin, which El Salvador recognizes as money, Barr noted.
And the law doesn’t cover coins that operate outside the U.S. such as Tether’s main coin, dubbed USDT, though Tether has launched a compliant U.S. coin, USAT.
We’ve been here before
During the free banking era from 1837 to 1863, banks could issue their own currency. But the system was inefficient, with currency values that fluctuated against each other.
“All states maintained a range of requirements for banks to collateralize their notes, but many proved ineffective; fraud was widespread, and the system was fragmented—banknotes of one bank were often not accepted by other banks outside the local area; bank failures were widespread,” the Andersen Institute for Finance and Economics writes in a report on stablecoins. Nonbanks, such as railroad companies, issued their own currency.
Money-market funds are a type of private money, promising to redeem shares at a dollar each, on demand. But during the global financial crisis, one fund couldn’t honor that value—it “broke the buck”—because it held devalued assets. A broader panic ensued.
Those cases showed how a loss of confidence can cause the volume of private money to contract, amplifying economic stress. Fabio Natalucci, chief executive of the Andersen Institute, notes that is the opposite of public money, which is “elastic”: The Fed expands its supply at times of stress.
Stablecoins are here to stay
Stablecoins are a natural evolution of payments technology, so it makes sense to find a way to integrate them into the economy. That’s what the Genius and Clarity acts attempt to do, which stablecoin advocates hope will encourage adoption.
That really hasn’t panned out yet, though. Japan boasts a “carefully designed regulatory framework” for crypto, but yen-based stablecoins’ market cap is less than 0.01% of dollar coins’, Hernández de Cos noted.
The vast majority of stablecoins are linked to the dollar, and those are largely held outside the U.S., often as a means of skirting laws or capital controls. Stablecoins account for 84% of illicit crypto activity such as sanctions evasion and money laundering, according to Chainalysis. Trading crypto remains the primary use of stablecoins. Today, less than 1% of stablecoin usage is for real-economy payments, a Kansas City Fed study concluded.
Meanwhile, banks are beginning to offer an alternative: “tokenized deposits,” which they think offer the “singleness” of dollars with the benefits of the blockchain.
Banks, of course, have caused their share of crises, which is why over time they became so tightly regulated and integrated with the Fed. Stablecoins may have to follow the same path.
Two coming 2027 models – the first of the “Neue Klasse” cars coming to the U.S. early next year – have been revealed.
The sports-car maker delivered 279,449 cars last year, down from 310,718 in 2024.
EFG Holding reported strong revenue growth during Q1 2026, with revenues rising 18% year-on-year to EGP 6.6 billion, supported by solid performance across investment banking, non-bank financial services, and commercial banking operations. The group also recorded strong momentum in treasury and capital markets activity, while subsidiaries including Valu and Bank NXT delivered notable growth in revenues and profitability despite rising operating costs.
< 1 min
EFG Holding, Cairo-based financial services group, recorded revenues of EGP 6.6 billion ($124.8 million) for the three months ending March 31, 2026, up 18% YoY
Growth was supported by solid performance across its investment banking, non-bank financial services, and commercial banking businesses. Operating profit rose to EGP 2.5 billion, increasing 20% YoY (+37% QoQ), with an operating margin of 38%.
However, net profit fell to EGP 1.0 billion, down 14% YoY. The strong performance was mainly driven by treasury and capital markets activity. Revenues from this segment jumped 84% YoY, helped by foreign exchange gains after the Egyptian pound weakened by about 14% in March.
The investment banking division reported revenues of EGP 3.1 billion, rising 9% YoY. Brokerage activity improved, with revenues increasing 4% YoY to EGP 1.6 billion, while asset management and private equity posted steady growth.
EFG Finance, the group’s non-bank financial arm, reported revenues of EGP 1.6 billion, up 20% YoY. This growth was mainly driven by Valu, the consumer finance platform, where revenues surged 85% YoY to EGP 895 million.
Bank NXT, the group’s commercial banking unit, delivered strong results, with revenues reaching EGP 1.9 billion, up 34% YoY. Net profit at the bank rose 39% YoY to EGP 691 million, supported by strong loan growth. The bank’s loan portfolio increased 52% YoY, while deposits grew 22% YoY, keeping the loan-to-deposit ratio at 63%.
At the same time, costs continued to rise. Operating expenses increased to EGP 4.1 billion, up 16% YoY (-33% QoQ).
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Qatar continued to strengthen its position as a regional hub for investment and business after attracting more than 3,290 non-Qatari companies during Q1 2026, marking a 66% increase compared to the same period last year. The country also recorded growth in new commercial registrations, patents, and trademark activity, reflecting rising confidence in Qatar’s economy and its business environment focused on innovation, expansion, and long-term growth.
2 min
Qatar attracted more than 3,290 non-Qatari companies during the first quarter (Q1) of 2026, reflecting growing international confidence in the country’s investment environment and economic outlook.
In a post on its X platform, the Ministry of Commerce and Industry (MoCI) released the new data showing strong growth across foreign investment commercial registrations, and intellectual property indicators.
Foreign investment saw substantial growth during the quarter. The post revealed a total of 3,295 non-Qatari companies established operations in the country during Q1 2026, reflecting a 66% increase compared to the first quarter of 2025.
The strong increase in foreign company registrations highlights Qatar’s continued efforts to position itself as a leading regional hub for trade, investment, and commercial expansion.
Qatar’s modern infrastructure, strategic geographic location, and policies are aimed at facilitating international investment and commercial partnerships.
Meanwhile the info graphic shared with the post revealed the new commercial registrations surged by 18.5% to 6,328 in Q1 this year compared to the last year. The Commercial Affairs Sector demonstrated significant progress across its key performance indicators.
The rise reflects growing entrepreneurial activity and increasing confidence in Qatar’s business environment. It also highlights the country’s continued efforts to strengthen the investment climate and support private-sector growth.
The info grapic also showed notable progress in intellectual property protection, an area considered essential for encouraging innovation and attracting investors. A total of 43 copyrights were granted during the quarter, marking a 16% increase compared to Q1 2025.
Trademark registrations also remained strong, with 1,661 trademarks granted during Q1.
One of the most significant increase was recorded in the patents sector. The ministry reported that 145 patents were granted during Q1 2026, representing a remarkable 134% increase over the same period last year. The surge points to growing investment in research, technology, and innovation-driven industries.
The figures send a positive signal about the resilience and competitiveness of Qatar’s economy amid ongoing global economic shifts. With momentum building across multiple sectors, Qatar’s commercial and investment activity will remain strong throughout the remainder of the year.
The sports-car maker delivered 279,449 cars last year, down from 310,718 in 2024.
Paine Schwartz joins BERO as a new investor as the year-old company seeks to triple sales.
Nvidia delivered another blockbuster quarter, beating expectations across revenue, guidance, and data centre growth, yet the market reaction remained surprisingly muted. As the AI boom matures, investors are beginning to look beyond GPUs toward the broader compute stack, including networking and CPUs, where rivals like Intel and AMD are gaining momentum. The message is clear: AI’s growth story is far from over, but the list of winners is starting to expand.
2 minNvidia has done it again, beating on the top and bottom line and guiding the current quarter well above Wall Street estimates, yet the share price barely moved. That tepid reaction has become the new normal for the world’s most valuable company, and it tells us exactly how high the bar has been set in the AI trade.
According to Josh Gilbert, Lead Analyst, Middle East at eToro: Revenue of USD$81.6 billion was up 85% on the same quarter last year, with the all-important data centre business pulling in USD$75.2 billion, growth of 92%. For a company of this size to still deliver that level of growth is staggering. Guidance for the July quarter came in at around USD$91 billion, comfortably ahead of the USD$87 billion consensus, while management lifted the quarterly dividend to 25 cents from 1 cent and authorised another USD$80 billion in buybacks. The buyback and dividend hike show that Nvidia wants to keep shareholders on side, even as the eye-watering share price gains of recent years become harder to repeat.
The result also showed that Nvidia’s growth story is broadening well beyond GPUs. Networking revenue came in at USD$14.8 billion, comfortably ahead of the USD$12.7 billion the Street was looking for. That’s key, because as AI factories get built out at scale, the networking layer can become a serious growth engine in its own right. At the same time, we’re also seeing the pivot into CPUs, driven by the build-out of agentic AI workloads, the next layer of the AI boom. Nvidia is still in pole position in this AI trade, but Intel and AMD lead the way on CPUs for now, with both stocks more than doubling this year as investors price in the shift. As agentic AI takes off, the value is going to spread across more of the compute stack, not just GPUs.
This result tells us that AI isn’t just a one-year story, it’s a story with many years ahead. The market has grown accustomed to perfection from Nvidia, and although we got that today, much of it was already priced in. The lens investors should be using from here is that the AI boom still has plenty of runway, but the winners’ list is going to get longer.
Two coming 2027 models – the first of the “Neue Klasse” cars coming to the U.S. early next year – have been revealed.
Many of the most-important events have slipped from our collective memories. But their impacts live on.
Rising global bond yields and uncertainty around the US Federal Reserve are increasing market volatility, as investors reassess inflation risks, interest rates, and global economic conditions.
2 minGovernment bond yields are rising across major economies including the US, UK, Europe and Japan, as investors reassess inflation risks amid higher energy prices, geopolitical tensions and growing fiscal pressures.
The move higher in sovereign yields reflects increasing market acceptance that interest rates may remain elevated for longer than previously expected, despite earlier hopes for monetary easing later this year.
Higher yields are also adding pressure to global equity markets, particularly growth and technology sectors, while increasing concerns over borrowing costs for governments and corporations carrying large debt burdens.
Lale Akoner, Global Market Strategist at eToro, said: “Markets are becoming increasingly sensitive to geopolitical risks and inflationary pressures. Rising oil prices and concerns around potential disruption in the Strait of Hormuz are reviving fears that inflation could remain stickier than expected at a time when many central banks were hoping to see further easing in price pressures.”
She added: “Bond markets are signalling that investors should prepare for a more volatile environment in the second half of the year, where elevated borrowing costs and uncertainty around monetary policy are likely to remain key themes.”
At the same time, investors are closely watching developments at the US Federal Reserve, as Kevin Warsh moves closer to potentially succeeding Jerome Powell as Fed Chair when Powell’s term ends on Friday.
According to Akoner, markets may be oversimplifying the implications of a potential Warsh-led Federal Reserve by viewing it purely through a hawkish-versus-dovish lens.
“A Warsh Fed would not necessarily represent a major tightening shock or a return to ultra-loose monetary policy,” she said. “Instead, it could signal a shift toward a more market-driven approach, relying less on balance sheet expansion and forward guidance, and more on market pricing, private capital and economic fundamentals.”
Such a shift could gradually reduce the Fed’s balance sheet and place greater responsibility on private banks and investors to absorb liquidity and government debt issuance.
For investors, this may create clearer distinctions between market winners and losers. Shorter-dated bonds could benefit from potential rate cuts once energy-related inflation pressures ease, while longer-term bonds may face continued pressure if inflation concerns and government borrowing keep yields elevated.
Financials, banks, insurers, asset managers and cyclical value sectors could stand to benefit from this environment, while speculative growth stocks, heavily indebted companies and weaker high-yield borrowers may face greater market scrutiny.
“Ultimately, a Warsh Fed could reshape how risk is priced across markets,” Akoner said. “That would likely leave investors more exposed to volatility and place a greater premium on quality, diversification and active positioning.”
The rise in global yields, combined with uncertainty over the future direction of US monetary policy, is expected to remain a key driver of investor sentiment and market performance through the remainder of the year.
Following the successful launch of its Palais Collection, MAISON de SABRÉ has unveiled a new modular handbag system offering more than 720 styling combinations.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Kuwait’s Heavy Engineering Industries and Shipbuilding Co. (HEISCO) has renewed a KD14 million ($45.4 million) credit facility agreement with a local bank to support its operational activities, marking the company’s second facility renewal this month following an earlier KD96.06 million agreement. The engineering and shipbuilding firm has also continued expanding its project portfolio in 2026, including securing a $565 million contract from Kuwait Oil Company in April.
< 1 minThe Kuwait-based Heavy Engineering Industries and Shipbuilding Co. (HEISCO) has renewed a 14 million dinars ($45.4 million) credit facilities agreement with a local bank in the Gulf state.
HEISCO said in a bourse filing, the facility will be used to finance the operational activities.
This is the second loan facility renewed by the contractor this month, with the earlier facility amounting to KD 96.06 million.
The engineering and shipbuilding firm has secured a number of contracts in the first half of this year, including one in April from the state-backed Kuwait Oil Company amounting to $565 million.
Many of the most-important events have slipped from our collective memories. But their impacts live on.
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
Longtime crypto investors are increasingly turning to Zcash, drawn by its privacy-focused features and growing momentum as some become disillusioned with bitcoin’s mainstream evolution.
3 min
Bitcoin die-hards think they’ve found the hot new thing.
Some longtime crypto enthusiasts are souring on bitcoin as it goes mainstream, frustrated that it no longer provides the privacy they value. Others are disenchanted with how politicians and celebrities are suddenly embracing bitcoin—or they’re just fed up with the token’s slumping price.
Now, bitcoin’s early evangelists are getting behind another digital token: Zcash.
Tyler and Cameron Winklevoss are among the bitcoin pioneers betting big on the so-called privacy token, which lets users shield their transaction details.
Zcash’s emphasis on anonymity reminds some of crypto’s early days, when privacy was championed as a ticket to personal freedom.
“It feels like bitcoin circa 2013,” said Barry Silbert, founder of Digital Currency Group and Grayscale Investments, which set up the first publicly traded bitcoin fund.
This year, DCG made Zcash one of its largest holdings, according to a person close to the matter. In November, Grayscale told regulators that it plans to convert its Zcash trust into an exchange-traded fund, making it more easily accessible to everyday investors. The move helped supercharge the token’s rally.
Zcash is up about 50% over the past month and 1,140% over the past year. Bitcoin, by comparison, has gained 8% in the past month, and dropped 24% in the past year.
Also driving Zcash’s surge: receding fears that U.S. regulators will take issue with the coin’s privacy features, which some worry could be exploited for ill use. Earlier this year, the Securities and Exchange Commission said it closed a probe into the coin.
Zcash, at $8.9 billion, is a smidgen of the size of bitcoin. And tiny cryptocurrencies have a history of surging and then collapsing, a reason to be wary.
Bitcoin vs. Zcash
| Bitcoin | Zcash | |
|---|---|---|
| Creator | Unknown | Group of scientists and engineers |
| Year founded | 2009 | 2016 |
| Distinction | Biggest cryptocurrency | Shielded addresses |
| 1-yr price change | down 24% | up 1,140% |
| Market cap | $1.59 trillion | $8.9 billion |
That hasn’t stopped some of bitcoin’s best-known backers from piling in.
The Winklevoss twins said in November that they invested $50 million to help launch Cypherpunk Technologies, a digital-asset treasury company that will hold Zcash.
“This is not some newfangled project that showed up on the scene with a lot of buzzwords and marketing push,” Cameron Winklevoss said in an interview.
Despite its hot new status in cryptoland, Zcash is a decade old.
The token was founded in 2016 by a group of scientists and engineers, including from MIT and Johns Hopkins. It was essentially a copy of bitcoin, but was intended to fix what its founders saw as a privacy flaw.
Like bitcoin, it lets users send or receive funds on a public ledger. The key distinction is that Zcash gives users the option to use shielded addresses, which use encryption to hide sensitive data, such as the sender, receiver and transaction amount.
(Zcash’s name is a nod to its use of zero-knowledge proofs, which allow for transaction verifications without divulging other details.)
Users can generate “viewing keys” to share transaction details with regulators or auditors—but it’s at their discretion.
The feature could give the coin vast commercial potential. Businesses, for instance, might use it to hide sensitive information such as payrolls and supplier relationships.
Proponents say it could also counter the moves of authoritarian governments to use financial surveillance to identify dissidents—a goal tracing back to crypto’s roots.
“Zcash is what bitcoin should be. It’s what bitcoin was originally meant to be,” said Tushar Jain, co-founder of Multicoin Capital, a venture-capital firm that recently built a significant position in Zcash.
Although bitcoin users don’t have to use their real names on the blockchain, its public ledger has made the token increasingly easy to trace. Many blockchain analytics firms help law enforcement decipher “anonymous” transactions and hunt down illicit activity.
For some, the extra layer of privacy that Zcash offers is a red flag.
Authorities worry that terrorists and other malicious actors could use such privacy coins to evade sanctions and commit crimes. Regulators in other countries have prohibited or restricted the listing of privacy coins on licensed exchanges.
Blockchain analysts have noted that terrorist groups so far have largely favored bitcoin and stablecoins, partly because they are easier to trade than privacy coins, which are much smaller in size.
For all the recent excitement around Zcash, the token lacks a feature that helped fuel bitcoin’s mythic status: a mysterious creator.
Unlike Satoshi Nakamoto, one of Zcash’s founders has remained a vocal figure.
Zooko Wilcox-O’Hearn, an American computer-security specialist and cryptographer, served as CEO of Electric Coin Co., which Zcash co-founders formed to develop the coin’s blockchain.
Since stepping down from that role in late 2023, Wilcox-O’Hearn has served as the chief product officer at Shielded Labs, which helps advance Zcash.
In December, he also joined the Winklevoss twins’ Cypherpunk Technologies as a strategic adviser. So far, the Zcash hoarding company has stockpiled more than 300,000 of the tokens.
Cypherpunk’s stock has gained 17% this month but is down 10% for the year. Along with the price of bitcoin, companies that hoard digital tokens have lately lost some of their luster.
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Interior designer Thomas Hamel on where it goes wrong in so many homes.
Workplace disputes are increasingly forcing companies into a tough call: fight allegations or settle to avoid reputational and legal fallout. While many claims are disputed, settlements are often driven by cost, risk, and disruption—especially in an era where AI and social media can rapidly amplify accusations beyond control.
3 min
An employee comes forward with embarrassing workplace allegations fraught with legal risks. For company bosses, it presents a thorny dilemma: Fight or pay?
It is a situation JPMorgan Chase JPM -0.70%decrease; red down pointing triangle found itself in weeks before a former banker filed a lawsuit filled with sensational accusations. It offered $1 million to settle his claims that a female colleague had sexually harassed and assaulted him and that co-workers had subjected him to discrimination, The Wall Street Journal reported. The bank has said it investigated the claims and doesn’t believe they have merit.
Though such deals rarely come to light, paying employees to make potential scandals go away isn’t an uncommon practice across corporate America. Companies have long offered settlements to head off litigation or avoid claims that could tarnish their reputations—even if executives conclude the allegations lack merit.
“The vast majority of settlements are business decisions,” said Bill Stein, a Los Angeles-based partner at employment law firm Fisher Phillips, who often works with companies on such matters. Some employers, wanting to avoid the time, expense and headaches of unwanted publicity and litigation, ask: “Can we just make this go away?”
The calculations over when and how much to negotiate have become more complicated now that artificial intelligence and social media can easily amplify such allegations. Often the decision-making involves external law firms, internal investigations and discussions with everyone from human-resources specialists to strategists in crisis public relations, executives and attorneys say.
Internal complaints—about anything from bullying and policy violations to performance issues and workplace violence—are surfacing with increasing frequency, data suggest. Allegations of discrimination, harassment and retaliation rose to 14.7 per 1,000 employees in 2024, up from 6.4 in 2021, according to HR Acuity, a company that helps employers track internal complaints and investigations.
“It happens every day of the week” at large companies, said Janine Yancey, an employment lawyer and founder of HR compliance firm Emtrain.
The decision on whether to offer a payout usually begins with a question: Is there truth to the claims?
Employers will often attempt to quickly investigate the matter, usually by interviewing those involved or pulling emails, texts and chat messages between colleagues on work devices. If companies find the allegations are at least partly substantiated, they are likely to offer a more generous settlement, lawyers and HR executives say.
In other cases, companies might feel the allegations are bunk—but still opt to settle. That can be for any number of reasons. Say a startup is trying to raise new funding, said Fisher Phillips’s Stein. The last thing they might want is to spook investors with a potential lawsuit.
Part of the calculation is the cost of the distraction, Yancey said. “For business executives, your time is money. These conflicts create friction and noise,” she said. The people at the center of the allegations lose sleep, stop eating and often can’t work productively. “It makes more economic sense to pay money and move on. Flat-out,” she said.
Often the employees lodging allegations prefer to settle quietly and move on too, lawyers say. If claims—especially salacious ones—become public, they can dog a person’s career, making it harder to find future jobs.
How much companies are willing to pay can vary widely. For many routine settlements, employers try to offer no more than two years’ compensation, said LeShanda Davis, a senior director of employee relations. But companies weigh many factors when determining amounts, including their degree of fault, the seniority of the people involved, the cost of litigation and the risk someone could generate significant attention with their claims.
“You’re paying for that individual to be an alum, not an adversary,” Davis said.
Some employers prefer to fight and be as public about it as they can. When a lawyer in billionaire Bill Ackman’s family office requested two years’ severance, instead of the three months offered, Ackman turned to social media for advice and affirmation, writing a 2,400-word post on X in April. The lawyer had cited an unsafe workplace, a description Ackman rejected, vowing to “fight this nonsense to the end of the earth.”
For employers, the other complicating factor is that even a settlement might not keep things quiet. A number of states, including California, now bar employers from using nondisclosure agreements to silence workers speaking out about workplace misconduct, including sexual assault, harassment and labor and safety violations.
JPMorgan’s offer to settle with the banker, Chirayu Rana, didn’t keep the claims from going viral. Rana didn’t take the $1 million—which was equivalent to less than two years of his compensation at the bank, the Journal previously reported. Instead, he ultimately went public.
After Rana filed the suit in a New York state court, AI-generated videos of Rana and the female banker quickly proliferated across the internet.
The lawyers for the female colleague, named in the lawsuit as Lorna Hajdini, have said they are entirely made up and that the two never had any sexual relations. An attorney for Rana didn’t respond to a request for comment but has said the truth would come to light in court proceedings. “Whether my client’s civil rights were violated will be determined in a court of law,” attorney Daniel Kaiser said last week.
Employment disputes rarely generate such attention or lurid claims, said Stewart Schwab, a professor at Cornell Law School. Still, the odds of a prelitigation dispute staying quiet are also likely going down in the AI and social-media era.
Now, “if it gets out,” Schwab said, “it really gets out.”
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Following the devastation of recent flooding, experts are urging government intervention to drive the cessation of building in areas at risk.
Dubai International Financial Centre (DIFC) reaffirmed the strength and resilience of its ecosystem, with global institutions across banking, insurance, wealth and innovation continuing to back Dubai and the UAE as a long-term growth hub. Despite regional uncertainty, firms are deepening their presence, supported by a stable regulatory framework, strong connectivity, and access to high-growth markets across MEASA.
7 min
Dubai International Financial Centre (DIFC) today reaffirmed the strength, resilience and long-term outlook of its ecosystem, as global clients across banking, insurance, wealth and innovation sectors expressed continued confidence in Dubai and the UAE.
Essa Kazim, Governor of DIFC, said: “Over the past few weeks, countries in the Middle East have been navigating a period of regional uncertainty together. During these times, the true strength of DIFC has been our clients and community. What defines us is a shared belief in long-term opportunities that Dubai and the UAE offer to access the 77 markets across the Middle East, Africa and South Asia.
Together, we are building the future of finance and advancing Dubai’s journey towards becoming one of the world’s top four global financial centers.”
Arif Amiri, Chief Executive Officer of DIFC Authority, said: “From global banks to FinTech disruptors, firms operating within DIFC say the current environment has not prompted retreat but rather reinforced the strategic importance of Dubai as a gateway to growth across the region. For many, the current environment serves as a reminder of why they chose DIFC in the first place: a stable and enabling legal and regulated framework, and globally connected platform capable of unlocking future growth.”
Recent milestones reinforce DIFC’s trajectory, including Dubai’s rise to 7th globally in the Global Financial Centres Index in March, which is its highest ever ranking and underscores sustained global confidence in the emirate’s financial ecosystem.
An integral part of the DIFC ecosystem are 290 banks and capital markets firms, including 17 of the world’s 19 global systemically important banks. This reflects the vital role DIFC plays in connecting major players to opportunities in the region and being the bridge between markets in the East and West. Global banking leaders from Citi, Julius Baer and Standard Chartered highlighted DIFC’s critical role as a stable platform connecting international capital with opportunity.
Ebru Pakcan, Middle East & Africa Cluster and Banking Head at Citi, noted: “At a time when geopolitical dynamics are reshaping markets, the ability to deliver cross-border solutions, maintain liquidity, and stay close to clients is critical. DIFC enables Citi to do exactly that. Citi has maintained a continuous presence in the Middle East for over six decades, recognizing its integral role in our global network.”
“Since establishing a presence at DIFC in 2006, we’ve seen the financial hub transform into a strategic platform that connects capital, clients, and opportunities across the Middle East, Africa, and South Asia. From supporting sovereign issuances and corporate funding to enabling efficient treasury and liquidity management, DIFC allows Citi to operate at the center of regional and global capital flows.”
Regis Burger, Head of Middle East & Africa and Chief Executive Officer, Julius Baer (Middle East) Ltd, highlighted: “The UAE has established itself as a leading global financial center and the foundations that underpin that position remain firmly intact. Its connectivity, business-friendly regulatory environment, tax-efficient framework, and world-class infrastructure continue to set it apart and attract investors, entrepreneurs, and institutions from around the world. DIFC has been at the heart of that story.
Julius Baer saw that potential before most. As the oldest organization in DIFC, we were here at its founding, driven by a conviction that this region would emerge as one of the world’s most important centers of wealth creation and a magnet for global capital. That belief has only deepened over two decades of being embedded in this market, across our offices in the UAE, working closely with our clients in creating and preserving their wealth and building relationships across generations.
The region is approaching a historic transfer of nearly $1 trillion in wealth across generations by 2030, and the families navigating that journey require more than financial expertise. As an organization with its own origins as a family business, Julius Baer has been through the entire business transformation cycle and understands what it takes to guide clients and their families through it.
We remain deeply committed to the UAE, the wider region, and to the clients and partners who trust us with their financial futures. That commitment does not waver in periods of uncertainty and it is precisely in these moments that our role as a wealth manager matters the most.”
Rola Abu Manneh, Chief Executive Officer, UAE, Middle East, and Pakistan at Standard Chartered, added: “We have been in the UAE for over 65 years, and DIFC has been our regional home since 2004. Our commitment to the country is firm and unchanged.
The UAE entered this environment from a position of strength, supported by robust balance sheets, strong institutions, and a well-regulated financial system.
Client activity across the UAE reflects continued engagement, with businesses using the UAE as a base to access opportunities across regional and international markets. Through our global network, we connect clients to those opportunities while ensuring continuity of service and access to banking solutions.”
The insurance industry has been growing in DIFC with gross written premiums doubling to over $4.2 billion in the last four years. Insurance leaders are emphasizing DIFC’s role in strengthening risk management capabilities across the region.
Omar Gemei, Senior Executive Officer of Marsh DIFC and Head of Global Placement & Bowring Marsh, India, Middle East & Africa, said: “Dubai has firmly established itself as a leading international hub for the insurance and risk management sector. It brings together insurers, brokers, and risk professionals to support clients facing increasingly complex and interconnected risks, underpinned by a strong understanding of the globally evolving business and regulatory landscape.
DIFC has been a key catalyst in that growth, providing a business-friendly environment that attracts global firms and supports innovation. For the insurance and risk management community, it provides access to regional markets writing global and regional business, reinforced by Dubai’s continued investment in infrastructure, talent, and regulation to further grow the sector.”
Dubai is home to the highest concentration of wealth in any Middle Eastern city and according to Henley & Partners, in 2026, the UAE has so far attracted more millionaires than any other country in the world. This has made DIFC the region’s preferred hub for wealth and asset management, with over 500 firms from the sector choosing to operate from the Centre.
Peter Clark, Chief Executive Officer, Bentley Reid, said: “Bentley Reid has been advising clients for almost fifty years, and over that time, we have successfully navigated diverse economic, market and political uncertainties. The lesson we draw from each of these episodes is that it seldom pays to make knee-jerk reactions or allow short-term turbulence to drive major strategic decisions.
Whilst the firm is a relative newcomer to DIFC, it soon became apparent that the UAE’s economic success has been built on several key fundamentals: its favorable fiscal environment, a pro-business culture, a dynamic and increasingly diverse economy, an exceptional quality of life and deep global connectivity. We are confident that this compelling mix will reassert itself as soon as the regional situation eases, rewarding those with patience and resolve.
The families, entrepreneurs and businesses who typically fare best during uncertain periods are those who focus on the long-term and return to first principles – asking themselves why they committed to a particular jurisdiction and whether those reasons still hold. In the case of Bentley Reid and the DIFC, the answer is an unequivocal yes.
This is reinforced by what we are witnessing on the ground. Very few – if any – in our HNW and UHNW network view current events as an existential threat to Dubai’s trajectory, or to their decision to make the UAE their home. This includes wealthy families planning relocations to the region; few are abandoning those plans, although some are understandably choosing to let the situation settle before finalizing their arrival.
For our part, Bentley Reid came to the DIFC for the long term. What we have seen, both leading up to the conflict and ever since, points to Dubai continuing to offer significant advantages to wealthy families and their advisers. If anything, the current environment reinforces the value of having a trusted and experienced international wealth manager at one’s side. That is exactly what Bentley Reid is here to provide.”
ICICI Prudential Asset Management Company established an office in DIFC in February this year. Nimesh Shah, Managing Director and Chief Executive Officer of ICICI Prudential Asset Management Company highlighted: “Dubai and DIFC are a natural fit for ICICI Prudential AMC’s global ambitions given their strong regulatory ecosystem, global connectivity and access to institutional investors. Our presence here reflects our confidence in India’s long-term growth story and our commitment to building enduring partnerships with global investors seeking India-focused opportunities.”
DIFC continues to be at the leading-edge for developing clear laws, regulations and operating frameworks for the digital assets and FinTech industries.
In 2020, Ripple established their regional headquarters for the Middle East and Africa in DIFC. This month, they announced a further expansion to their presence in the Centre.
Reece Merrick, Managing Director, Middle East and Africa, Ripple commented: “Ripple established its regional headquarters for the Middle East and Africa in the UAE in 2020. Since then, we have substantially grown our presence, expanding our team, signing new clients and forging innovative partnerships, to meet growing demand for digital assets infrastructure. During this time, we’ve also witnessed first-hand how much the country has strengthened its position as a global financial hub.
This doesn’t happen without a strong foundation, and the UAE provides exactly that: a forward-looking market underpinned by clear and progressive regulation that has reinforced its position as one of the leading global centers for our industry.
The local authorities have played a central role in establishing the UAE as one of the world’s leading hubs for digital assets. The clarity and ambition of the regulatory frameworks that have been put in place, combined with a mature financial ecosystem and access to institutional capital, gives companies the confidence to lay solid foundations here. That is a hard thing to build, and the UAE has achieved it, setting a benchmark not just for the wider region, but globally.”
Stake has been using its DIFC presence to develop innovative PropTech solutions, recognizing the importance of the real estate industry to the UAE. Manar Mahmassani, Co-Founder & Co-CEO, Stake commented: “Stake was born in Dubai in 2021, when global uncertainty was at its peak. Today we are the largest fractional investment platform in the world because we started here.
“When we launched Stake, choosing to set up in DIFC was a no-brainer. It wasn’t just about operating in the most credible financial jurisdiction in the region. As a start-up, DIFC gave us exactly what we needed: a launch pad and a plug-and-play co-working environment that was bustling with innovation. The address, the infrastructure, the retail and F&B, the caliber of professionals in every corner, and the proximity to our regulator, the DFSA – DIFC offered us as founders and our teams a work-play lifestyle that is genuinely second to none.
“For a FinTech like Stake, building the future of real estate investment demands regulatory clarity, access to world-class capital partners, and a standard of governance that global investors recognize instantly. DIFC delivers all three, and it has been one of the most important accelerants of our growth.”
The payments industry is significant in the UAE and Taptap Send has been using Dubai to develop their offering. Michael Faye, Chief Executive Officer at Taptap Send added: “DIFC has been a genuine home for our team, our relationships, and our ambition. It has built something rare: a world-class environment where ambitious FinTech companies can access deep talent, global connectivity, and an infrastructure that leads international standards. For Taptap Send, the UAE is exactly the right base from which to do it, connecting underserved communities to the global financial system from one of the world’s great international hubs. That ambition mirrors our own, and I can’t imagine a better place to pursue it.”
The collective voice of global financial institutions, insurers, asset managers and future-focused innovators reinforces DIFC’s position as a resilient, trusted and forward-looking financial ecosystem. Despite a complex global backdrop, firms continue to deepen their presence, guided by confidence in the Centre’s internationally credible legal and regulatory environment, global connectivity and long-term growth prospects.
As momentum builds across traditional and emerging sectors alike, DIFC remains central to enabling capital flows, fostering innovation and supporting sustainable economic expansion, further cementing Dubai’s standing as a leading global financial hub.
Parts for iPhones to cost more owing to surging demand from AI companies.
In times of heightened uncertainty, investing shifts from prediction to resilience. With geopolitical risks impacting confidence, energy prices, and global growth, the focus turns to liquid, high-quality assets built to withstand multiple scenarios. As volatility rises and dispersion widens, diversification, strong fixed income positioning, and portfolio flexibility become essential to navigating an increasingly complex market environment.
4 min
At times of intensified uncertainty and dispersion like today, investing becomes less about forecasting and more about favouring more liquid, high quality assets that can be resilient across a variety of scenarios.
Global growth has been more resilient than expected despite growing divergence below the surface. What has changed is the addition of a major new source of risk: the conflict in the Middle East. If this proves to be a short-term disruption, as markets are currently pricing, then the baseline outlook still assumes moderate global growth. However, a prolonged disruption would pose more significant challenges and increase global recession risks.
Geopolitical risks tend to transmit to the economy through changes to consumer and business confidence, financial conditions, and – most importantly today – energy prices. The Strait of Hormuz, a critical waterway for oil and energy shipments, remains effectively blocked. Similar to Russia’s invasion of Ukraine in 2022, this threatens to spark a global energy supply shock.
Energy supply shocks are stagflationary
Unlike in 2025, when divergent trends left global growth broadly unchanged, the Middle East conflict is likely to be stagflationary, lifting inflation while hurting growth. We see four main transmission channels: higher energy and food prices; disrupted supply chains and trade flows; tighter financial conditions; and lower business and consumer confidence.
Negative oil supply shocks are inflationary for all economies, while growth effects will differ. Higher energy prices are stagflationary for net oil importers – transferring income abroad through more expensive energy imports while reducing household real (inflation-adjusted) income and business real profit – and expansionary for net oil exporters.
Within developed markets, Europe, the U.K., and Japan are energy importers and face larger downside growth risks. Canada and Australia should benefit from their net energy export status. Two decades of shale production increases have turned the U.S. from a net energy importer to a slight exporter. However, the U.S. is still a large economy with an energy sector as opposed to a commodity economy. Since energy is an important input into all goods it imports, the U.S. will likely still behave as a net energy importer to some extent.
Central banks face a tug of war – but this isn’t 2022
The risk of higher inflation alongside lower growth puts central banks in a tricky spot. Conventionally, central banks tend to look through supply shocks, especially in economies that are net energy importers. After the elevated post-pandemic inflation period, however, central banks will be closely focused on the risk that a large supply shock could lead to more persistent pressures as inflation expectations and wages also adjust higher.
Yet economies are in much different positions than they were in 2022. At that time, the world was still dealing with pandemic-related pent-up demand, and governments had injected trillions of dollars into the private sector. The result was a large demand shock on top of a large supply shock. Labor markets were also extremely tight, driving both nominal wages and prices higher.
Today, by contrast, fiscal policy is tight across many regions as elevated post-pandemic sovereign debt forces restraint. Labor markets are much looser. Monetary policy is already neutral to slightly restrictive across most developed market economies.
As a result, economies are much more likely to adjust to the current shock through lower real incomes, weaker nominal wage adjustments, and greater recessionary risks.
Investment implications: resilience, quality, and liquidity
This is not an environment set up to reward bold forecasts or narrow bets. Instead, today’s conditions favour more liquid, high quality portfolios built to weather shifts in market sentiment and a range of potential outcomes.
Resilient headline growth alongside widening dispersion strengthens the case for high quality fixed income. Starting yields are much higher today than in 2022, providing cushion against inflationary tail scenarios and strengthening the role of bonds as both a return generator and a hedge against downside risks.
Markets rarely price geopolitical risk well. When there is a global shock, portfolio liquidity can allow investors to take advantage of market inefficiencies and valuation gaps that arise. As volatility rises and dispersion widens, the ability to manage downside risk and redeploy capital as conditions evolve matters more than trying to capture incremental yield by forfeiting liquidity.
High quality bonds once again play a meaningful role in portfolios and look attractive across a variety of economic scenarios. For portfolios that have drifted heavily toward equities, this is a practical moment to consider rebalancing. Yields across more liquid fixed income remain attractive, laying a solid foundation for market-driven income and return.
We prefer a modest overweight to duration and more balanced curve exposure, as yields look attractive across a range of maturities.
The case for global diversification remains strong. Differences across countries are widening, creating both risks and opportunities.
Looking across the continuum of public and private credit today, we see the greatest value in areas including U.S. agency mortgage-backed securities (MBS), investment grade issuers with stable, predictable cash flows, and high quality securitized credit.
Currency positioning matters more in this environment, particularly given the growing divergence between energy exporters and importers. Inflation-sensitive assets also deserve a more deliberate role in portfolios today. Commodities, real assets, and Treasury Inflation Protected Securities (TIPS) can help hedge real-world purchasing power and diversify returns when traditional asset relationships become less reliable. These exposures may help improve portfolio resilience.
Conclusion – recentre towards fixed income?
This is a market that rewards preparation for an uncertain set of outcomes. Higher yields, wider dispersion, and greater volatility create a favourable backdrop for active management when portfolios are built with liquidity and flexibility in mind.
For investors, this is a moment to consider recentring portfolios toward fixed income, to use global diversification and inflation tools intentionally, to treat liquidity as an asset, and to emphasise quality and resilience in the face of layered uncertainty.
Following the successful launch of its Palais Collection, MAISON de SABRÉ has unveiled a new modular handbag system offering more than 720 styling combinations.
Dubai showcases its advanced manufacturing ecosystem at Make it in the Emirates 2026, reinforcing its position as a global hub for industry, investment, and export-driven growth.
3 min
The Dubai Department of Economy and Tourism (DET) will showcase the emirate’s advanced, future-ready manufacturing ecosystem at the Dubai Pavilion during ‘Make it in the Emirates 2026’, the fifth edition of the UAE’s flagship industrial forum, taking place from 4–7 May at ADNEC Centre Abu Dhabi. The participation comes at a time when Dubai continues to demonstrate operational continuity and economic resilience, reinforcing its position as a stable and globally connected industrial hub.
Held under the theme ‘Advanced Industry. Emerging Stronger’, the forum reflects the UAE’s commitment to building a sustainable, technology-driven industrial base anchored in innovation and global partnerships. Dubai enters the forum bolstered by a standout performance, having achieved 6.4% GDP growth in Q4 2025, with total GDP reaching AED937 billion for the full year, underscoring steady economic momentum despite global headwinds. DET’s participation aligns with the goals of the Dubai Economic Agenda, D33, which targets more than doubling manufacturing value-added output in the decade up to 2033, while reinforcing Dubai’s position as a leading destination for industrial investment.
As one of the UAE’s most significant industrial gatherings, ‘Make it in the Emirates’ unites government entities, national champions, manufacturers, and SMEs to drive tangible outcomes, from offtake commitments and investment deals to technology transfer and strategic partnerships.
DET will present Dubai as a globally connected hub for advanced manufacturing, underpinned by world-class infrastructure, integrated logistics, and seamless access to international markets. Attendees will gain an understanding of how manufacturers operating in Dubai benefit from connectivity to more than 130 export destinations, supported by Comprehensive Economic Partnership Agreements and advanced customs facilitation measures that ensure reliable trade flows. At the Dubai Pavilion, DET will bring together key entities including Dubai Industrial City, National Industries Park, Dubai Integrated Economic Zones Authority (DIEZ), Dubai Chambers, Dubai Future Foundation, Food Tech Valley, and other strategic partners.
His Excellency Hadi Badri, CEO of the Dubai Economic Development Corporation (DEDC), the economic development arm of DET, said: “Dubai’s leadership has consistently taken decisive, policy-driven action to safeguard growth and stability. Our manufacturing sector reflects this approach: it is diversified, technologically advanced, and fully integrated into global value chains. Even amid regional pressures, business continuity remains seamless across logistics, trade and industrial operations. Through the Dubai Economic Agenda, D33 we are also strengthening our value proposition for manufacturers by enabling new investments and plant expansions through tailored incentive frameworks. These include support mechanisms designed to enhance cost competitiveness, reduce barriers to entry, and accelerate scale-up for high-impact projects.
Our participation in ‘Make it in the Emirates’ is an opportunity to translate that vision into partnerships and close the deals that will strengthen local manufacturing, drive economic momentum, and further reinforce Dubai’s position as a leading hub for export-led growth.”
The Dubai Pavilion will serve as a central platform to engage investors, manufacturers, and stakeholders, offering insights into the emirate’s competitive advantages. DET representatives will also participate in high-level engagements focused on industrial development, investment facilitation, and market expansion into and from Dubai.
As part of its participation, DET will highlight a range of initiatives designed to support industrial scale-up and export expansion. These include the Export Assistance Programme (EAP), which enables Dubai-based manufacturers to access international markets, and the Elite Buyer Programme, which strengthens Dubai’s position as a global sourcing hub. Additional initiatives such as Industry 4.0 enablement programmes, In-Country Value (ICV) promotion, and industry-friendly power policies will also be showcased, reinforcing Dubai’s commitment to advanced manufacturing technologies and local capacity building.
DET will also use the platform to strengthen national collaboration, working closely with the Ministry of Industry and Advanced Technology and other stakeholders to ensure alignment with the UAE’s broader national strategy. Several strategic partnerships with major entities in the logistics and banking sectors are expected to be formalised during the forum, further demonstrating sustained institutional confidence in Dubai’s industrial trajectory.
Building on the strong investment momentum of previous editions, this year’s ‘Make it in the Emirates’ represents a pivotal platform for translating D33 industrial ambitions into measurable outcomes for businesses across the emirate and beyond.
Paine Schwartz joins BERO as a new investor as the year-old company seeks to triple sales.
Global markets show resilience despite a major energy shock triggered by the Strait of Hormuz closure, with oil prices surging and supply disruptions hitting several countries. Strong reserves, policy support, and the AI-driven economic boom have helped sustain growth—for now.
4 min
One of the major surprises about the gravest energy shock since the 1970s is how resilient much of the world has been so far.
The closure of the Strait of Hormuz has yanked around 13 million barrels of oil a day from global energy supplies. Blackouts have hit Pakistan, the Philippines has imposed a four-day workweek, and countries including Slovenia and Bangladesh have rationed fuel. The risk that the world sinks into recession is rising with each day the waterway remains shut. The price of Brent crude, the global oil benchmark, has risen more than 50% since the strait was closed.
Even so, in the two months since the strait was closed by Iran in response to U.S. and Israeli attacks, many of the world’s major economies have been soldiering on in contrast to the swift downturns that accompanied similar energy crises in the 1970s and 1990s. Stock markets are touching record highs.
This resilience reflects ample energy reserves, policies to help consumers, and the offsetting effects of the artificial-intelligence boom that is powering trade and business investment in the U.S. and beyond.
It also highlights an underappreciated shift in the workings of the global economy. Over the years, countries have become steadily more energy efficient, squeezing more economic activity out of each drop of oil or cubic meter of natural gas burned. The energy needed to generate a dollar of gross domestic product, adjusted for inflation, has since 2000 fallen by about a third in the U.S. and Europe and by about 40% in China, according to World Bank data.
Better energy efficiency “cushions the shock” from supply disruptions, International Monetary Fund Managing Director Kristalina Georgieva said in April. Underlining the global economy’s resilience, the IMF said that assuming energy flows through the strait resume by midyear, it expects only modestly slower growth this year than in 2025, at around 3.1% versus 3.4% last year.
Of course, a more severe test of the global economy’s durability will occur if the conflict persists and the strait stays closed. The cease-fire between the U.S. and Iran is holding, but so far there is no agreement to reopen the waterway, which is also subject to a U.S. blockade aimed at starving Iran of imports and revenue.
Poor countries that don’t have reserves to draw on and are on the sidelines of the AI boom are already struggling, with shortages closing factories and high import prices for energy straining threadbare government budgets.
If the strait remains closed into next year, the IMF warned global growth in 2026 could sink to around 2%, bringing the world economy close to recession.
When Russia’s invasion of Ukraine triggered a similar energy shock in 2022, consumer prices were already surging in big economies as pent-up demand collided with strangled supply as they reopened after the pandemic.
Central banks had little choice but to jack up interest rates almost immediately. This time around, central banks don’t face the same pressure from domestic inflation as they weigh the risks from a bump in global energy prices. Central banks in the U.S., Europe and Japan held their benchmark interest rates steady this week as they assess the effects of the war on their economies.
“The economic outlook remains highly uncertain, and the conflict in the Middle East has added to this uncertainty,” Federal Reserve Chair Jerome Powell said Wednesday.
Compared with 2022, “the starting point is more benign,” said Mansoor Mohi-uddin, chief macro strategist at the Bank of Singapore, a private bank. Government spending on defense and other priorities is also helping economic activity while the strait remains closed, he said, though he added he is concerned that higher prices and shortages could start to bite within weeks.
Since the closure of the strait, governments have swung into action to stabilize energy supplies and keep a lid on price rises for consumers.
Key to their efforts are deep reserves. Japan and Korea had around 200 days’ worth of reserves on hand in January, according to the International Energy Agency. Europe had 130 days’ supply. China’s enormous stockpile, estimated by the U.S. at around 1.4 billion barrels, is enough to power its economy for about 100 days.
For Asia especially, another counterweight to strains from the energy shock has been buoyant exports. The AI boom has meant ravenous demand in the U.S. and elsewhere for Asia-made chips, electronics and machinery to power data centers.
Exports from Japan were 12% higher in March than a year earlier. In South Korea, they rose almost 50% and in Taiwan, they rocketed 68%.
“AI is papering over the cracks,” said Stefan Angrick, head of Japan and frontier markets economics at Moody’s Analytics in Tokyo.
A deeper reason for the global economy’s resilience compared with previous energy shocks is greater energy efficiency. Advanced economies have shifted to less energy-intensive services such as finance and healthcare from more energy-hungry manufacturing.
Renewables have also played a role—both solar and wind lose less energy as heat than burning fossil fuels. Consumer appliances have been re-engineered to use less electricity and firms have squeezed out improvements in industrial processes to save energy.
German engineering giant Thyssenkrupp has improved its use of energy through measures including capturing waste heat, reducing leaks and replacing lighting and other components with newer, more energy-efficient alternatives, according to recent disclosures on its sustainability efforts.
France’s Saint-Gobain, a construction firm, said in a 2025 report that it has started using AI to monitor and adjust energy use in its fiberglass furnaces to boost efficiency, and is replacing natural gas with more efficient fuels such as hydrogen. Modeling by the IMF suggested that energy-saving measures adopted by European companies in the aftermath of the 2022 crisis reduced by about one-third the long-term damage to the European economy.
With this latest energy crisis, some economists worry about how many more shocks the global economy can take. Hits from the pandemic, energy and U.S. tariffs are causing ripples that could outlast the shocks themselves, such as weaker investment, subdued business and consumer confidence, and strained public finances, said Aaditya Mattoo, director of development research at the World Bank.
“You have this succession of shocks,” Mattoo said. Countries, especially developing ones, “face this tough trade-off between providing relief today and sustaining growth tomorrow.”
Many of the most-important events have slipped from our collective memories. But their impacts live on.
Central Bank of the UAE has kept its base rate at 3.65%, following the US Federal Reserve’s decision to hold its benchmark rate. The UAE central bank also maintained borrowing rates at 50 basis points above the base rate, keeping monetary policy stable.
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The Central Bank of the UAE (CBUAE) has decided to maintain the Base Rate applicable to the Overnight Deposit Facility (ODF) at 3.65%.
This decision was taken following the US Federal Reserve’s announcement today to keep the Interest Rate on Reserve Balances (IORB) unchanged.
The CBUAE has also decided to maintain the interest rate applicable to borrowing short-term liquidity from the CBUAE at 50 basis points above the Base Rate for all standing credit facilities.
The Base Rate, which is anchored to the US Federal Reserve’s IORB, signals the general stance of monetary policy and provides an effective floor for overnight money market interest rates in the UAE.
Many of the most-important events have slipped from our collective memories. But their impacts live on.
Saudi Aramco’s Q1 2026 net profit is forecast to reach SAR 108.8 billion, up 13.8% YoY and 56.7% QoQ, driven by higher oil prices and stronger refining margins, according to AlJazira Capital.
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Saudi Aramco’s net profit after minority interest is expected to rise by 13.8% year-on-year (YoY) and 56.7% quarter-on-quarter (QoQ) to 108.8 billion Saudi riyals ($29.01 billion) in the first quarter of 2026, according to a report by AlJazira Capital.
The net profit is anticipated to increase by 12.6% from the adjusted net profit reported in Q4 2025.
The sequential growth in adjusted net income is likely to be driven by crude oil prices surging 24.8% QoQ, due to better refining margins and reductions in certain operating costs, wiping out the impact of lower production of 600,000 barrels per day (bpd) of crude and 700,000 barrels of oil equivalent per day of hydrocarbons.
Revenue is estimated at SAR 455.3 billion, up 6% YoY and 9.4% QoQ. The upstream revenue is expected to drive topline growth, rising 13.1% QoQ, while the downstream revenue is forecast to rise 6.8% QoQ.
The Saudi-listed oil giant’s revenue in 2026 is projected to increase to SAR 1.9 trillion, while net income is expected to rise to SAR 427 billion.
The brokerage estimates the average oil price of around $86 per barrel.
“We expect higher crude oil prices this year and flexibility to divert exports from east to west coast to reflect positively on Aramco’s revenue and earnings in 2026.”
AlJazira Capital has assigned an “Overweight” rating to Aramco stock, with a target price of SAR 29.6 per share, subject to an upward revision.
Aramco will publish its Q1 2026 results on May 1.
New research suggests that bonuses make employees feel more like a mere cog in a wheel.
Stocks slipped while oil prices climbed as U.S.–Iran tensions escalated, with Brent crude rising 5.6% to $95.48 a barrel and the S&P 500 and Nasdaq pulling back from recent highs; despite geopolitical pressure, market moves remained relatively muted, supported by strong economic data as investors turn to a busy earnings week with expectations for continued profit growth.
2 min
Stocks slipped and oil prices rose Monday, with fresh tensions between the U.S. and Iran casting a shadow over Wall Street.
Brent crude futures, the international oil benchmark, rose 5.6% to $95.48 a barrel. Major stock indexes fell, with the S&P 500 and Nasdaq composite retreating from record levels reached last week.
The latest strains between the U.S. and Iran unwound some of the optimism that swept through markets last week, culminating Friday when Iran said the Strait of Hormuz was “completely open.”
U.S. negotiators are expected to arrive in Pakistan tonight for talks with Iran this week, although Tehran has cast doubt on its participation. In a social-media post, President Trump threatened to attack Iranian infrastructure if the country doesn’t make a deal.
The tech-heavy Nasdaq fell 0.3%. The S&P 500 declined 0.2% and the Dow Jones Industrial Average fell about 5 points, or less than 0.1%.
Those declines were shallow compared to selloffs earlier in the war. Oil prices remained below its highs earlier in the conflict, when prices were around $120 a barrel. At the same time, stocks tied to the real economy rallied.
“The pretty muted response by the market tells me that the market’s in good shape,” said Sean Clark, chief investment officer at Clark Capital.
The Russell 2000 index of smaller companies gained 0.6% to close at its third straight record and notch its best 14-session performance since 2020. The Dow Jones Transportation Average, which tracks the railroads, airlines and truckers that move the goods powering the economy, rose 4%.
Walmart, a bellwether for the U.S. economy, reached a market capitalization of $1 trillion Monday, becoming the ninth-largest U.S. company, according to Dow Jones Market Data.
Elsewhere, psychedelic-drug stocks jumped after Trump signed an executive order Saturday to speed up research and patient access to new treatments for mental-health conditions. Shares of Compass Pathways, GH Research and AtaiBeckley all rose more than 17%.
Some investors said that despite worries the war would fuel a recession, strong data on jobs and earnings have offered assurance that the economy is on solid footing. Many still expect that the war will end sooner rather than later, and limit its impact on markets and the economy.
“The reality is, the present level of uncertainty in the latest conflict is not going to derail broad economic growth,” said Kieran Osborne, chief investment officer at Mission Wealth.
Nearly a fifth of S&P 500 companies report earnings this week, including Tesla, Boeing, Intel and Lockheed Martin. Early results indicate companies are on track for a sixth-straight quarter of double-digit earnings growth, according to FactSet.
Elsewhere, investors looked to Federal Reserve chair nominee Kevin Warsh’s confirmation hearing before the Senate Banking Committee on Tuesday. He plans to say that the central bank’s independence is self-enforced, and that price stability is the Fed’s “plot armor,” according to a copy of his remarks.
New research suggests that bonuses make employees feel more like a mere cog in a wheel.
