Prof G Markets: Tariffs Blocked by Court, U.S. Steel’s Golden Shares & Neuralink’s Funding Round

Release Date: June 2, 2025
Hosts: Scott Galloway & Ed Elson
Podcast Network: Vox Media Podcast Network

Introduction

In this episode of Prof G Markets, Scott Galloway and Ed Elson delve into significant developments impacting the capital markets, ranging from court decisions on tariffs to major corporate funding rounds. Their insightful analysis provides listeners with a comprehensive understanding of current financial landscapes and future implications.

Weekly Market Review

Timestamp: [07:05]

Ed Elson kicks off the discussion with a swift overview of the week's market movements:

• S&P 500: Experienced a rally.
• US Dollar: Climbed during the week before slightly retreating.
• Bitcoin: Saw a pullback from its all-time highs.
• 10-Year Treasuries Yield: Declined.

Quote:
Ed Elson: “The S&P 500 rallied, the dollar climbed through the week before giving up some ground. Bitcoin retreated from its all-time highs, and the yield on 10-year treasuries declined.”
[07:05]

Tariffs Blocked by Court

Timestamp: [08:21]

Scott Galloway and Ed Elson discuss the recent ruling by a US trade court that President Trump exceeded his authority in imposing tariffs on cars, steel, and aluminum. The court emphasized that only Congress holds constitutional power to regulate commerce with foreign nations, rendering Trump's emergency powers claim invalid.

Key Points:

• Constitutional Authority: Only Congress can regulate international commerce.
• Market Reaction: Apple and Amazon stocks each rose by approximately 3%, while chip stocks also saw gains.
• Future Implications: The likelihood of tariffs being repealed remains uncertain due to ongoing appeals.

Notable Quote:
Scott Galloway: “The Constitution is late to the party here, but it's a welcome guest. It showed up and said, no, not so fast.”
[08:21]

U.S. Steel’s Acquisition by Nippon Steel

Timestamp: [32:06]

The hosts transition to the long-awaited acquisition of U.S. Steel by Japan’s Nippon Steel, which has finally progressed after over 17 months of delays. President Trump has endorsed the deal, framing it as a "partnership" rather than an outright acquisition. A pivotal addition to the agreement is the golden share provision, granting the U.S. government the authority to approve key appointments and prevent production cuts.

Key Points:

• Employment Impact: Nippon Steel commits to investing $14 billion in U.S. steel over 14 months, potentially increasing U.S. Steel employment by up to 70,000 jobs.
• Government Intervention: Introduction of a golden share to oversee strategic decisions.
• Initial Opposition: Both Trump and Biden previously opposed the deal due to union concerns and national security risks, though latter concerns were later deemed unfounded.

Notable Quote:
Scott Galloway: “This is a mix of xenophobia, ego, and pandering to unions. This is stupid.”
[33:21]

Trump Media’s Bitcoin Investment

Timestamp: [13:32]

Ed Elson introduces the topic of Trump Media’s ambitious $2.5 billion funding round aimed at investing in Bitcoin, mirroring strategies previously employed by companies like MicroStrategy. However, unlike MicroStrategy, Trump Media’s stock declined by nearly 5% following the announcement, despite Bitcoin hitting all-time highs and subsequently dropping 10%.

Key Points:

• Comparative Analysis: While MicroStrategy thrived with a similar strategy, Trump Media faced negative market reactions.
• Market Sentiment: Suggests diminishing hype around Bitcoin treasury strategies as more companies adopt them.
• Strategic Concerns: Doubts over the sustainability and market enthusiasm for large-scale Bitcoin investments by media companies.

Notable Quote:
Ed Elson: “This could be an indication that this is sort of the canary in the coal mine for the hype running out.”
[14:08]

Nvidia’s Stellar Earnings Amidst Export Restrictions

Timestamp: [20:10]

The conversation shifts to Nvidia's impressive first-quarter earnings, which surpassed expectations with a 69% year-over-year revenue increase, driven primarily by robust performance in their AI chip segment. Despite facing new export restrictions that barred the sale of their high-capability H20 chips to China, Nvidia remains optimistic, although it acknowledges a projected $8 billion revenue reduction from the Chinese market.

Key Points:

• Revenue Growth: Significant year-over-year increase driven by data center and AI chip sales.
• Impact of Export Ban: Restricted access to the Chinese market led to lower gross margins and revenue forecasts.
• CEO Jensen Huang’s Stance: Publicly criticized U.S. export policies, emphasizing China’s advancements in AI regardless of U.S. restrictions.

Notable Quote:
Scott Galloway: “Export restrictions have spurred China's innovation and scale. The AI race is not just about chips. It's about which stack the world runs on.”
[23:01]

Neuralink’s $600 Million Funding Round

Timestamp: [47:19]

In the latter part of the episode, Scott and Ed explore Elon Musk’s Neuralink securing $600 million in a new funding round, valuing the startup at $9 billion—a significant leap from its previous valuation of $3.5 billion in late 2023. Currently in early human trials, Neuralink's brain implant technology has shown promise in assisting individuals with spinal cord injuries by enabling communication through thought alone.

Key Points:

• Technology Advancements: Early trials have successfully enabled paralyzed individuals to control computer interfaces using their brains.
• Valuation Concerns: The high valuation is debated given the technology’s nascent stage and lack of revenue generation.
• Future Potential: While the technology holds transformative potential, timelines for commercial release remain uncertain.

Notable Quote:
Scott Galloway: “It's incredible technology that literally transforms people's lives, giving them the ability to walk and talk again.”
[50:20]

Conclusion & Week Ahead

Timestamp: [59:40]

As the episode wraps up, Scott offers predictions for the coming week, anticipating continued market skepticism towards tariff-related announcements from Trump. He expects the market to become complacent with such statements, leading to reduced volatility and diminished impact on stock movements.

Key Points:

• Market Expectations: Increased resistance to the effects of new tariff announcements.
• Apple's Performance: Anticipates Apple’s stock stabilizing below previous highs despite mixed market signals.
• Overall Outlook: Predicts a cooling off in the previously heated tariff trade dynamics.

Notable Quote:
Scott Galloway: “The market is wising up to it the same way... the market is going to begin to yawn.”
[59:40]

Upcoming Episode Preview

Listeners are invited to join the next episode featuring Robert Armstrong, a Financial Times journalist known for coining the term "taco trade," which refers to Trump's inconsistent tariff strategies. The hosts encourage subscribing to stay updated with daily insights beginning the following week.

Final Thoughts

Prof G Markets offers a nuanced examination of pivotal events shaping the financial and corporate sectors. Scott Galloway and Ed Elson provide expert analysis, enriched with pertinent quotes and a clear breakdown of complex issues, making it an invaluable resource for investors and individuals keen on understanding market dynamics.

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