Chinese AI Panic + Other Headlines

Tuesday Digest (01.28.25)

Wall Street Panics Over China’s AI Advances

Yesterday, America’s biggest technology stocks dropped significantly after the announcement that a Chinese AI startup called DeepSeek had been able to create an artificial intelligence chatbot just as capable as Google’s Claude or OpenAI’s ChatGPT—but at a fraction of the cost.

Chip-maker Nvidia plunged 16 percent. The tech-heavy Nasdaq dropped three percent. Many other individual stocks recorded substantial declines. Why? Because global competition in the AI race is here, and China appears to have gained ground very quickly. OpenAI and Microsoft had allocated billions of dollars to train their chatbots. DeepSeek says it did it with less than $6 million and less advanced chip technology.