# NVIDIA Governance Crisis and AI Market Volatility

**Podcast:** Unhedged
**Published:** 2026-11-10

## Transcript

Big tech has got a bunch of big problems.
Higher borrowing costs, nervous investors and an American public that's fed up with hulking great data centres in their backyards.
And as we all know, big tech is the global stock market, so it's all got pretty volatile out there on Wall Street and beyond.
But wait, now there's a whole new thing to worry about.
An old school spy drama involving chips giant NVIDIA.
its CEO, Jensen Wang, and, quotes, a woman who US intelligence believes was working for China's Ministry of State Security.
Hoo boy.
Today on the show, what happens when massive companies run by humble nerds become national security risks?
This is Unhedged, the markets and finance podcast from the Financial Times.
I'm Katie Martin, a markets columnist in the dark dungeon of Efty Towers in London, where, slowly but surely, the Christmas decorations are already hitting the shops.
Oh, that's terrible.
I know, but it's true.
I just want to stop the show.
We're talking about serious issues on the show, but a much more serious issue that our society needs to address is the appearance of Christmas decorations before the Thanksgiving holiday.
A pattern that I believe can be stopped only by imposing the death penalty on anyone who uses a Christmas decoration before the final Thursday in November.
OK, so joining me all the way from over there in New York is the Grinch, Robert Armstrong, my partner in crime on the Unhedged newsletter.
Rob, I'm going to say.
There's too much news.
There's midterms.
There's market madness.
Now we've got NVIDIA.
In the most neutral and careful terms you can find, tell the nice boys and girls, please, what is going on.
I think it is difficult to exaggerate.
Even based on the few solid facts we have now, what a huge mess this is.
So let's take it step by step.
The AI investment boom is the biggest industrial boom the United States has ever had.
And associated with that boom is a highly concentrated stock market dominated by large companies that are heavily invested in this AI boom.
At the center of that industrial and stock market boom.
There is one indispensable company, which is NVIDIA, which is the best producer of the most advanced chips that make all this artificial intelligence possible.
It's the first $5 trillion company in the world.
Yeah.
And is always one of these three or four companies that are swapping places as the most valuable company in the world and the most valuable company ever.
Now, at this most indispensable of companies, in this biggest of all historical investment booms, is a CEO who is extraordinarily important to that particular company.
It is very flat in its organization.
There are a massive number of people who report to the CEO, Jensen Wang, and everything that is important at the company, we are told, runs through him.
Large collection of leather jackets as well.
It is confirmed that he has had an affair, which is fine.
Admitted it.
Admitted it.
But it is alleged by people, including U.S.
intelligence, that he was having this affair with a woman who was three things.
One, a Chinese national.
Two, an executive in the semiconductor industry, and three, an asset of China's Ministry of State Security.
This is a failure of judgment on the part of Jensen Wang, which goes on the Mount Rushmore of failures of judgment.
Now, China is saying this is all, this has nothing to do with us, but it doesn't look great.
Shares have taken a big hit.
So as we were talking about in the podcast just on Thursday, the second one that we recorded, because the markets weren't pear-shaped, NVIDIA shares have been having a bad time so far this month, but they're now down 13% this month.
That is a lot for a company that at least was at a certain point worth $5 trillion.
You know, 13% of $4 or $5 trillion is, ooh, let me think, a lot of money.
So a lot of money has been incinerated in that move in the stock.
Why do investors hate it so much?
Katie, the money is the least of it, right?
Any normal CEO, any normal employee of 99% of the companies in the world, if they did something like this, and again, not have an affair we're talking about, we're talking about having an affair that looks like the last kind of person in the entire universe someone who's running in NVIDIA should be having an affair with, right?
This person would be instantly fired.
The first thing we would have heard of it is we've had to fire our CEO because he just won the stupidity Olympics, right?
But there are four or five guys in the world who can survive this kind of disclosure because they are so incredibly important.
Is it possible to fire this guy who is an immensely powerful and important central figure in what is arguably the most important company in the world?
It's worth also just like rewinding just a tiny bit to say like the whole relationship between NVIDIA, the US government and China.
Let's say it's complicated, right?
There are bans, like multiple bans on selling NVIDIA's best microchips to China because they could be used in weaponry and defense and all that sort of thing.
So this is a highly controlled environment.
China would love to get its hands on a lot of these chips.
You do the math, right, on kind of, you know, what this looks like.
Let me layer another layer of difficulty on top of the one you just laid out.
which is the layer of geopolitical competition focusing on microchips.
Microchips are the main locus of the competition between the U.S.
and China.
On top of that, this man, Jensen Wang, has been a crucial spokesperson for the industry who has the ear of a little-known political figure called the President of the United States.
And he's been saying for a long time that these export bans to China are a bad idea and we shouldn't be doing them.
And this story sheds an interesting light on that.
Yeah.
Now, if you are a senior executive from the United States and probably from other Western nations, but the examples I have been told about firsthand are from the United States, so I'll just talk about them.
If you are going on a trip.
associated with your industry, specifically this industry, to China.
They warn you about precisely this in explicit terms.
Your people and your, you know, the grown-ups say to you, be on guard about this particular kind of situation.
So this is not something that is conceivable that Jensen Wang...
It just surprised him that this might have turned out, you know, this is the kind of thing one should know about and be alert to.
I know that you're always watching out for, you know, secret employees of rival newsletters and podcasts.
I know.
I mean, the women who are after my tens and tens of dollars, Katie, it's really, it's a major issue for me.
It's embarrassing for everyone involved.
But yeah, this is like a known thing for senior business executives and especially for senior business executives in certain spheres, you know, politically sensitive stuff like finance or definitely microchips or defense or any of that stuff.
So this does look like a series of boo-boos.
Now, what is NVIDIA going to do about it?
Well, here is the problem.
It is not clear that NVIDIA has a succession plan.
which is itself a massive scandal.
Even if you think that Jensen Wang under normal conditions is going to live forever and get smarter every day he ages, there are buses out there in the world and airplanes and terrible diseases and things happen to CEOs.
And a job and perhaps the most important job of a corporate board is to have a contingency plan in place.
There is no presumed successor here.
They may be no successor at all.
The board of NVIDIA is small.
Its independent directors have been serving in their jobs for an unusually long amount of time.
And there is no chair.
Yeah, these other board members, some of them have been there for three decades alongside Wang.
So to say that they're like, you know, loyal is understating it, potentially.
It looks extremely cozy.
And this goes to one of the awful truths of corporate governance is that when the business is working the way it should, it just doesn't matter and no one cares.
And the whole point of corporate governance, arguably the only point of corporate governance, is to be a series of mechanisms that kick in when things go terribly wrong.
And something has gone terribly wrong here.
Yeah, yeah.
This is one of the questions that people are asking, right, is did NVIDIA's board know what was going on?
If it did, when did it know what was going on?
So when was it?
Two weeks ago, the New York Times asked about this relationship and the company told the paper that it was, quote, not unusual or unexpected for the executive of an important commercial.
partner to have a close relationship with with jensen wang it's not looking super is it and also this is the last thing that big tech needs right now because as we were discussing on thursday no one wants the stupid data centers there's a kind of a bit of a bit of a tech lash going on it's not just the physical data centers that people don't want people are kind of sick of this message from big tech that we're going to take your job and then like accidentally kill you or something.
Like this is just not a sales pitch that people really gravitate towards.
Speaking as a humble saver who really hopes that this stock market doesn't crack in the face of all this pressure, man, was I glad to see that Anthropic is still planning to go ahead with its IPO, that that news came out in the last day or so.
What an important vote of confidence in this industry.
And how bad could it have gotten if we'd gotten the opposite news?
So big sigh of relief there.
The maker of Claude says that it's going to list on the stock market pretty soon.
The headline that I saw on our homepage just before I came down here was that there'll be a valuation of up to $1.4 trillion, which is a lot of dollars.
I will be fascinated to see.
how willing the market is to absorb that sort of thing at that sort of price.
I mean, given the environment, I don't know.
Like, Anthropica are either extremely brave or extremely foolish to be pushing ahead, I think.
But I'm glad they are in this circumstance because we don't need another vote of no confidence in this industry.
On the point of governance and how these mega companies should be.
managed.
We are at an important moment in history, I think, in that there are these, I don't know, there's a certain handful of companies that are so important geopolitically, economically, for the stock market, for people, for how we're living our lives.
And many of them, not all of them, are centered around single individuals or small handful of individuals.
And they're kind of gods, right?
On Mount Olympus.
They're untouchable.
They're geniuses.
They're very special boys and girls, mostly boys.
And we mustn't question them because they're busy being geniuses.
They are also human beings, though, it turns out.
Yeah.
This is very, very dangerous.
And let me ask you a question.
I don't have a firm answer to this, but I think it's a question we should be asking.
Does being one of these Olympian beings who bestride the earth shooting lightning bolts out of their eyes, does the sense that those people are untouchable make it more likely that they do stupid things?
In other words, if Jensen Wang had a successor waiting in the wings, had a real board, was not the face of his company and indeed his industry.
would he have been more cautious?
An analogous question.
If Mark Zuckerberg was working for a company with a share structure that made him vulnerable to activist investors, and there was a successor in place and so forth, would he have spent $80 billion and renamed the company after a project that was an unequivocal failure called the metaverse?
And, you know, $80 billion or whatever the number was, I'm not sure it was 80.
It didn't turn out to be that much money.
It was a lot of money, but it didn't turn out to be that much money for meta shareholders.
But still, would $80 billion or whatever the number is have been saved if this was not one of these Olympian figures?
And I think we have to reckon with what it does to someone's head.
when they are treated in this way and they're at the middle of these unusual corporate structures.
I will say one more thing, which is to NVIDIA's credit, they do have a normal one share, one vote shareholder structure, which I'm very happy about.
Jensen Wang owns less than 5% of this company.
That's kind of the saving grace here.
That's how they should all do it.
Good on NVIDIA for having that share structure.
Bad on a lot of other...
these giant companies for having these crazy structures designed to keep the founders in charge.
Like you say about corporate governance, it's such an aggressively boring topic.
Nobody cares about corporate governance until it doesn't work and until it turns out that there isn't any.
It's like, where's the fire extinguisher?
Oh, who cares where the fire extinguisher is?
Yeah, yeah.
Succession planning and very boring training for senior employees about not doing silly things.
These are all important.
It's a sticky time out there for everyone involved.
Yeah, let's see how much further Nvidia's share price has to pull.
We're going to come back in just one sec with Long Short.
It is time for Long Short, that part of the show where we go long a thing we love or short a thing we hate.
Rob Armstrong, what are you saying?
I hate and am short impeachment.
You know I don't like talking politics.
I am a member of that U.S.
political party known as Centrist Dad.
But on behalf of apolitical boars across America, I call upon the Democratic Party, newly empowered by the midterm elections.
Do what you like, but don't bother with this impeachment stuff.
We've seen this movie before.
Please, no.
Don't impeach Pete Exeth.
Don't impeach the president.
Change laws.
Make a better world.
Improve my life.
But for Pete's sake, not Pete's sake, for my sake, don't do it.
That's all I have to say on that topic.
Okay.
I'm not sure I'm 100% on your police work there, Rob, but nonetheless.
I thought you might not.
I am long Celine Dion.
Bless her.
Despite illness and constant riots in Paris, she's doing 26 sold-out performances up to May next year.
You've got to love a power ballad diva.
What is the best Celine Dion song?
It's got to be like My Heart Will Go On or something.
I actually don't like her music, but I think the fact that she's willing to...
you know, sacrifice herself at the altar of music and perform no matter what the dangers.
At this crucial time in our history.
Yes.
A power ballot is what we need.
I think that's right.
She's going to keep La République together.
Céline Dion, we salute you.
Listeners, we will be back on Thursday.
So clean out your ears and listen up then.