Moody’s Downgrade, Klarna’s Losses, and Uber’s Boardroom Battle

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Dear Money Master,

Investors are facing a wave of uncertainty as Moody’s downgrades the U.S. credit rating, pushing Treasury yields past critical levels and raising fresh concerns about fiscal stability 📉. In the tech world, Xiaomi is investing $6.9 billion to develop its own chips and reduce reliance on U.S. suppliers, while Qualcomm re-enters the data center race with AI-focused CPUs. Klarna’s losses are growing just as new BNPL regulations hit the UK, and volatility — measured by the VIX — has sharply declined, though inflation expectations remain elevated 📊.

And in our Article of the Day, we take a closer look at Uber — not just the ride-hailing giant, but a leadership lesson in disguise. When things spiraled out of control, its board stepped in and forced out its own founder, Travis Kalanick 🚘. It’s a powerful reminder that even visionary CEOs answer to something bigger: the board of directors.💼

📰 Your Daily Financial Digest - May 19th, 2025

🌍 Economics & Finance:

1. Moody’s Downgrades U.S. Credit Rating to Aa1 📉
   Treasury yields surged after Moody’s stripped the U.S. of its final top-tier credit rating, citing rising debt burdens and interest costs. The downgrade could increase borrowing costs for the government and consumers, as it signals waning confidence in long-term fiscal discipline. Read More

2. Tariff Fears Weigh Heavily on U.S. Consumer Sentiment 😟
   The University of Michigan’s sentiment index fell to 50.8 — the second-lowest ever recorded. Inflation expectations jumped as over 70% of consumers spontaneously cited tariffs as a concern. Uncertainty around trade policy is now a dominant force shaping household economic outlooks. Read More

3. UK Moves to Regulate Buy Now, Pay Later Sector 💳
   The UK is cracking down on BNPL lenders like Klarna and Affirm, requiring affordability checks and enabling refunds and dispute resolution via the Financial Ombudsman. Regulators aim to curb rising debt risks and bring consistency to a fast-growing, lightly governed sector. Read More

4. VIX Fear Gauge Falls Below 20 After Historic Spike 📉
   Volatility plummeted from 40.72 to 17.24 in just 21 days — the fastest normalization in the VIX’s history. Markets breathed easier after a 90-day tariff pause, though long-term concerns remain as elevated tariff levels could still return in July. Read More

💻 Technology:

1. Xiaomi to Invest $6.9B in Custom Chips Over 10 Years 🔧
   Xiaomi is reviving its chip ambitions with a new 3nm SoC, the Xring O1, aimed at flagship smartphones. This long-term $6.9B commitment signals a strategic move to reduce dependency on U.S. suppliers and compete with Apple, Samsung, and Huawei. Read More

2. Qualcomm Targets AI Data Centers with Custom CPUs 🧠
   Qualcomm is launching custom CPUs for AI data centers, designed to interface directly with Nvidia GPUs. It’s a bold re-entry into a fiercely competitive space dominated by Intel, AMD, and even Amazon — and a key piece of Qualcomm’s diversification plan. Read More

3. AI Startup Smartex Tackles Fashion Waste with Amazon, H&M 💡
   Smartex uses AI and vision tech to detect textile flaws in real-time, reducing material waste in garment production. Backed by Amazon and H&M, it aims to digitize an industry still plagued by inefficiencies and environmental challenges. Read More

💹Earnings:

1. CoreWeave Reports 420% Revenue Surge, Signs $11.9B Deal with OpenAI 🚀
   CoreWeave posted nearly $1B in revenue and expanded its 2025 outlook, driven by booming AI demand. A $11.9B contract with OpenAI underscores its rising importance in AI infrastructure — even as it racks up steep losses from rapid expansion. Read More

2. Klarna’s Losses Double as IPO Stays on Ice 🧊
   The BNPL giant reported a $99M loss amid restructuring and AI investments. Despite growing revenues and a vast user base, Klarna shelved its U.S. IPO plans due to tariff-related market instability, mirroring moves by other firms like StubHub. Read More

3. Birkenstock Lifts Guidance After Strong Q2 Performance 👡
   Birkenstock reported better-than-expected earnings and raised full-year guidance. The sandal maker sees a competitive edge in the current tariff climate, citing pricing discipline and strong brand equity to drive double-digit growth across all regions. Read More

🔍 Article of the Day: How Uber Went from Idea to IPO 🚕📈

From a snowy night in Paris to a $70 billion IPO, Uber’s story is as much about bold vision as it is about boardroom power plays. 🚘 What started as a scrappy startup backed by angels 👼 quickly turned into a VC-fueled rocket ship, but as the Cap Table 🧾 filled up and controversies piled on, Uber’s board made a dramatic move—forcing out its own founder, Travis Kalanick. This isn’t just a story about ridesharing; it’s a masterclass in how founders can lose control and why corporate governance 🏛️ matters more than charisma. Tap the app to dive into one of Silicon Valley’s most iconic power struggles.

Read the full story on the Money Masters app. 📲

Gold hitting record highs

The price of gold keeps heating up. If the record-breaking year of 2024 wasn't enough, gold hit a major historic 2025 milestone by crossing the $3,000/ounce threshold!

Here are 3 Key Reasons:

1. Looming economic & political uncertainty

2. Increasing central bank demand

3. Rising National Debt - over $36 Trillion

So, could gold surge even higher?

According to a recent statement from Jeffrey Gundlach, famed American business man and investor… “Gold continues its bull market that we’ve been talking about for a couple of years, ever since it was down to $1,800.” He expects gold to reach $4,000/oz.

Is it time you learn more about precious metals?

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To your financial empowerment, The Money Masters Team

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DISCLAIMER: This information is for educational purposes only and does not constitute financial advice. The publisher does not accept any responsibility for any losses incurred as a result of actions taken based on the information provided. Always conduct your own research or consult with a financial advisor before making any investment decisions.