This update was written automatically with AI from market data and news wire reports, and published without review by a person.
Key Takeaways
- Commerce Secretary Howard Lutnick has reportedly stalled three separate orders from President Donald Trump to crack down on the diversion of Nvidia (NVDA) AI chips to China.
- Treasury Secretary Scott Bessent publicly rebuked the Commerce Department, stating that multiple agencies—including State, Defense, and USTR—supported blacklisting the Singapore-based firm Megaspeed months ago.
- Nvidia (NVDA) has lost approximately $700 billion in market value as of mid-November 2026, following the resignation of CEO Jensen Huang amid a suspected Chinese espionage scandal.
- Internal friction has reached a boiling point in the Situation Room, where Bessent confronted Lutnick over his department's refusal to add Megaspeed to the Entity List despite its reported $4.8 billion in chip purchases.
Cabinet Clash Over National Security and Trade
A high-stakes divide has emerged within the Trump administration regarding the enforcement of technology exports to China. Commerce Secretary Howard Lutnick is facing intense scrutiny for allegedly blocking efforts to restrict Nvidia (NVDA) hardware from reaching Chinese entities through third-party intermediaries. Reports indicate that President Trump authorized crackdowns in May, August, and most recently on November 5, 2026, yet the Commerce Department has failed to implement these directives.
The tension became public when Treasury Secretary Scott Bessent criticized the delay on CNBC, noting that "Commerce has the pen" regarding the Entity List. This trade blacklist is the primary tool for restricting foreign companies from accessing sensitive U.S. technology. Bessent emphasized that the Treasury, State, and Defense departments have been in favor of blacklisting Megaspeed International—a Singapore-based company suspected of funneling chips to China—for several months.
The Nvidia Scandal and Market Impact
The administrative deadlock coincides with a historic crisis at Nvidia (NVDA). The company's co-founder and long-time CEO, Jensen Huang, resigned on November 11, 2026, following reports of a relationship with Alice Huang, a former executive at Megaspeed whom U.S. intelligence officials believe was recruited by China's Ministry of State Security. Nvidia (NVDA) shares have plummeted, erasing nearly $700 billion in market capitalization as investors weigh the risks of expanded export bans and leadership instability.
Lutnick's resistance to these curbs has drawn criticism due to his former role as CEO of Cantor Fitzgerald, which held a $1.2 billion stake in Nvidia (NVDA) at the time of his nomination. While a spokesperson stated Lutnick has divested his interests, critics point to the fact that Cantor Fitzgerald—now run by his sons—reduced its Nvidia (NVDA) position by 49% between September 2025 and March 2026, a period during which the Commerce Department was already under pressure to tighten controls.
Political and Economic Fallout
The standoff is complicating President Trump's broader trade agenda. Lutnick has warned that aggressive export controls could trigger a retaliatory trade war, potentially undermining the administration's signature tariff policies. However, bipartisan pressure is mounting in Congress, with the House Foreign Affairs Committee demanding transparency into why the Commerce Department continued to permit exports despite warnings of Chinese intelligence activities.
As President Trump prepares for high-level meetings at the APEC forum in Shenzhen, the future of his economic team remains uncertain. Reports suggest that senior White House officials are discussing whether Lutnick should be removed from his post. Such a move could significantly shift the balance of power within the administration, potentially giving more influence to U.S. Trade Representative Jamieson Greer and signaling a more hawkish turn in the ongoing tech-trade conflict with Beijing.
Automated market updates written with AI from market data and news wire reports, published without human review.