Investors Are Hedging Against the Risks of the AI Boom

Some tech employees have made so much money from the AI boom that they’re quitting their jobs. Not to retire or pursue a passion project, but to hedge their company stock.

It’s a striking sign of how nervous some investors have become about Wall Street’s multitrillion-dollar bet on artificial intelligence. The trade has been enormously profitable, but recent disappointments have prompted investors and tech executives to seek protection against a larger unraveling. They’re turning to options and credit-default swaps, while trading firms are developing new derivatives tied to the price of computing power.

As one trader puts it: “I don’t think my house is going to catch on fire, but I still have insurance.” Gunjan Banerji reports on the growing demand for protection against the AI trade’s risks.

Darline Graham had just been sworn in to finish her late brother’s Senate term when she was in the Oval Office trying to coax President Trump to support Lindsey Graham’s Russia sanctions bill. It was then that Trump asked her to run for a full six-year term, something she said she hadn’t previously considered. Now polls show her tied with or trailing Democrat Annie Andrews, making South Carolina competitive in a way it hasn’t been for decades. “It’s just been absolutely brutal,” Graham said, referencing how she lost her brother and competed in three elections in a span of months. Josh Dawsey spent the day with Graham on the campaign trail as she fights to keep her brother’s seat.

Amazon has long been the first stop for many online shoppers, but Meta just built a new one in the form of its personal AI agent, Muse. More than 10 million people in the U.S. and Canada set up the agents in Muse’s first month and a half, the company said. Muse could disrupt Amazon’s model by finding and buying products, effectively bypassing the human browsing experience. The threat lies in Muse’s potential to undermine one of Amazon’s most lucrative businesses: advertising. Amazon blocked Muse from shopping on its site shortly after its launch, citing safety concerns, report Isabella Simonetti and Suzanne Vranica.

One of the world’s most famous Porsches is a race car painted in a psychedelic swirl of purples and greens. Known as the “Hippie Car,” it stunned the racing world in 1970 by beating Ferrari at Le Mans. What it is potentially worth is unclear, but these days, masterpieces of motor sports history are selling for Pablo Picasso prices. Now, two owners think they have it. One purple-and-green Porsche is housed in a Philadelphia museum; the other belongs to a former race car driver. With tens of millions of dollars potentially at stake, which one is the real deal?

Candidates and their backers are spending nearly this much in the midterm cycle, making it the most expensive in history, according to ad-tracking firm AdImpact. Then there are candidates who have somehow managed to stay dry amid a deluge of dollars. Some of them are dodging rodents and pawning power tools just to stay afloat.

In recent years, the charming town of Dali in southern China’s Yunnan province became known as the place where young Chinese people go to escape the rat race and “lie flat”—giving up on work or generally doing the bare minimum. The Journal’s Hannah Miao visited the place they call “Dalifornia” to try to understand the disillusionment among young people in the country. What she found was that many of these drifters were tired of doing nothing. They wanted to get back to work.

Today’s newsletter was curated and edited by Bharbi Hazarika and Natasha Dangoor in collaboration with Editor in Chief Emma Tucker. Got a tip for us? Here’s how to submit.