A sprawling coordinated network of 1,653 X (formerly Twitter) accounts masquerading as Iranian citizens, based both inside Iran and in diaspora communities, ran a targeted disinformation push to boost Israeli Prime Minister Benjamin Netanyahu’s re-election bid in the run-up to last week’s national vote, a joint investigation by Israeli outlet Haaretz and social media monitoring firm Expose confirmed on Friday. The fake profiles, which framed their advocacy as coming directly from the Iranian people, published content almost exclusively in Hebrew urging Israeli voters to cast their ballots for Netanyahu and his ruling Likud party, claiming a Netanyahu government would shield Israel from the Iranian Islamic Republic and its allied Axis of Resistance. The network’s activity followed highly regimented, synchronized patterns that ruled out organic, independent user behavior: Expose’s data showed two of the accounts shared 109 identical posts, a figure exponentially higher than the four overlapping posts that would be statistically expected from unconnected users. The coordinated accounts also responded to 232 separate posts from 53 different unrelated profiles within a five-minute window of one another, with activity spiking dramatically on official election day. Examples of their tightly choreographed output include two accounts posting the same Hebrew call to “support Benjamin Netanyahu to finish the job” paired with the #IsraeliElections2026 hashtag roughly an hour apart on election morning, a 10pm eve-of-election comment urging followers to “vote only for the Likud party” under a Netanyahu post, and two separate identical posts telling users to “Vote for Benjamin Netanyahu” published within two minutes of each other just after midnight. A dual-language Hebrew and English post circulated at 2am that week explicitly tied support for Netanyahu to protection from Iranian state forces. The vast majority of the accounts – roughly 1,600 of the 1,653 profiles – had been flagged as part of a previously documented 2024 influence operation that promoted Reza Pahlavi, the exiled son of Iran’s overthrown 1979 shah, as a viable alternative to the current Iranian government. As Israel’s general election campaign ramped up in July 2025, 185 of these existing accounts pivoted their activity to engage directly with Netanyahu’s official X profile, sharing content that attacked his political rivals and amplifying his campaign messaging. Once last week’s election wrapped up, the full network reverted to its original core focus of promoting Pahlavi’s political agenda. The findings were first submitted as expert evidence in October, when the Brandeis Institute and watchdog group FakeReporter filed a formal petition with Israel’s Central Elections Committee targeting Netanyahu, the Likud party, and the Prime Minister’s Office over suspected illegal unreported election advertising. Committee chairman Judge Noam Solberg rejected the petition on the eve of the election, noting that while the network’s activity appeared on its face to violate mandatory election ad transparency rules, the panel could not issue a final enforceable ruling because the identities of the accounts’ operators remained completely unknown. Solberg ordered all collected evidence to be forwarded to Israeli law enforcement for further criminal investigation. Both the Prime Minister’s Office and the Likud party have repeatedly issued formal denials of any connection, coordination, or financial support linked to the fake Iranian account network.
作者： admin
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Trump names Stephen Miller as new chief of staff
In a surprise public announcement posted to his Truth Social platform on Friday, U.S. President Donald Trump unveiled a major senior staff reshuffle that ousts long-serving chief of staff Susie Wiles from her top administrative post, replacing her with veteran presidential ally Stephen Miller, who will officially step into the chief of staff role effective the following Monday.
Trump’s public statement took many political observers by surprise, as the president had explicitly ruled out any imminent change to the chief of staff position just weeks earlier, telling reporters earlier this month there was “zero chance” Wiles would be replaced and adding that she would remain in the role “for a long time.”
The leadership shakeup unfolds directly in the aftermath of a devastating performance for the Republican Party in the 2026 U.S. midterm elections, where the party lost control of both the U.S. House of Representatives and the U.S. Senate, eroding Trump’s legislative leverage to advance his policy agenda through the rest of his presidential term.
In his announcement, Trump praised outgoing chief of staff Wiles for delivering an “outstanding job” in her tenure leading White House operations, noting that the 69-year-old senior official will transition to lead the dedicated Trump Political Operation arm of the president’s broader political network. Wiles, who is widely regarded as one of the most influential and personally trusted figures in Trump’s inner circle, recently completed treatment for cancer, revealing in September that she had entered full remission six months after her initial diagnosis.
In an official public statement responding to the news, Wiles framed her time on Trump’s White House team as “the honor of a lifetime,” citing shared policy wins including border security enhancements, broad federal tax cuts, economic growth initiatives, and the administration’s signature America First policy framework as points of collective pride. She emphasized that while her formal role is shifting, her loyalty to the president and commitment to his policy mission will remain unbroken.
Miller, who first rose to prominence as a senior policy advisor during Trump’s first presidential administration, is widely recognized as the primary architect of the administration’s signature hard-line immigration policies, and has maintained a reputation as one of the most ideologically consistent and unwaveringly loyal allies to Trump over the course of his political career.
This developing story continues to unfold, with additional details about the transition plan and incoming White House operational changes expected to be released in the coming days. -
Mohammed Hijab suggests UK counter-terror police tried to recruit him as informant
One of the UK’s most high-profile religious and political content creators, Mohammed Hijab, has come forward with formal public allegations against British counter-terrorism authorities, claiming officers sought to recruit him as a confidential informant following a prolonged seizure of his personal electronic devices. Operating under the public moniker Mohammed Hijab, the creator — whose legal name is Mohamed Hegab — identifies as a religious philosopher currently pursuing a doctoral degree in the subject at the University of Birmingham. Boasting a YouTube subscriber base of over 1 million, he has built a widespread public profile for his rigorous, often high-stakes public debates spanning religious theology, global geopolitics, and Middle East policy, including recent high-profile appearances on Piers Morgan’s broadcast programs where he faced off against former Israeli military international spokesperson Jonathan Conricus. In a public, on-the-record post to his X (formerly Twitter) account dated November 4, 2026, Hijab laid out a timeline of the alleged encounter: on May 12, 2025, he was stopped at Gatwick Airport by officers operating under Schedule 7 of the 2000 Terrorism Act, a legislative provision that grants border and counter-terror teams broad authority to detain, question, and search individuals at ports of entry without requiring pre-existing reasonable suspicion of terrorist activity. During the stop, officers seized all of his personal electronic devices, which Hijab states were used to access and review more than 10,000 of his private messages. The devices were not returned to him until nearly four months later, on September 11, with no follow-up questions or formal charges filed against him. Following a formal subject access request for records related to the stop, Hijab received heavily redacted documentation from Counter Terrorism Policing (CTP). One unredacted handwritten line in the examining officer’s case notes explicitly reads “Doesn’t want to be an informant”, a detail he shared alongside a screenshot of the partially redacted CTP document, which bears the official agency watermark. He also published a second screenshot of an official letter dated May 18, 2025, from the Gatwick Borders Team under Counter Terrorism Policing South East, which formally notified him of a legal adjustment to the authority used to retain his seized property, with two full paragraphs of the correspondence redacted. The letter explicitly notes that the retention of his property does not confirm he is currently the subject of a criminal investigation, and pledged to return his belongings at the earliest possible opportunity, though no timeline was specified. Hijab has since elaborated on the incident in a YouTube address, disclosing that he was summoned for a voluntary police interview under caution as part of an ongoing active criminal investigation, which he asserts is largely focused on his pro-Palestinian, anti-Israeli public activism. He went on to claim, without providing accompanying corroborating evidence, that the state of Israel was actively interfering with his work to curtail his public advocacy. At the time of publication, Middle East Eye (MEE) reached out to CTP London for an official statement addressing Hijab’s allegations, but no response had been received to the media outlet’s inquiry. It remains unclear whether the extensive redactions on the documents Hijab shared were applied by Counter Terrorism Policing prior to releasing the records to him, or if Hijab redacted the remaining content himself to protect the privacy of third parties and sensitive operational details.
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A deadly raid tests a revolutionary town’s faith in Syria’s new government
Traveling north from the Syrian capital of Damascus toward the Lebanese border, the route winds through desolate, untended apple and cherry orchards before climbing steeply into the rugged Qalamoun mountain range. It is here that the historic rebel stronghold of Rankous sits, where 33-year-old Abu Jad, a former Free Syrian Army (FSA) fighter who took up arms against longtime dictator Bashar al-Assad, waited on the main thoroughfare to greet the visiting reporter. Abu Jad, who lost full function of his right arm to a 2014 bullet wound, waved from behind the tinted window of his SUV with a tight, weary smile, and welcomed the visitor to what he called “the revolutionary capital of the Qalamoun region.”
That hard-won peace the town had cherished in the months following Assad’s ouster was shattered in the pre-dawn hours of 22 October, when Syrian internal security forces launched sweeping raids across Rankous, storming private homes and local businesses, detaining 45 residents and killing five young local men. The Syrian Ministry of Interior released an official statement framing the operation as a counterterrorism action, claiming the five deceased men held ties to the Islamic State, espoused extremist ideology, and had formally denounced the Syrian state as un-Islamic. But local residents paint a drastically different picture: three of the victims were completely unarmed at the time of the incursion, while the other two opened fire only after security forces breached private property, killing two members of the security detail in the exchange. Many families told reporters they initially mistook the raiding party for members of the Lebanese Hezbollah militia, which had occupied large swathes of Rankous during the civil war, explaining the split-second decision to resist.
In the days after the raid, hundreds of Rankous residents flooded the central town square — a space that had been scheduled to host a collective mass wedding for 12 local couples in less than two weeks’ time — to hold a multi-day funeral for the five slain young men. Instead of celebrating new life and the long-awaited end of 14 years of brutal war, the community was gathered to mourn sons who had spent their entire childhood and adolescence under bombardment, siege and regime persecution, only to be gunned down months after Assad’s government collapsed.
For Rankous, a town that lost more than 600 residents to the war, either killed in combat, detained, or disappeared into the notorious Saydnaya prison 15 minutes away, the October raid has deepened a pervasive sense of unmet justice and marginalization in the new post-Assad political order. Once a core hub of anti-regime resistance, where local rebel commander Firas al-Bitar rallied hundreds of residents to drive Assad’s forces out of the town in late 2012 and later fought off a full-scale Hezbollah incursion in 2014, Rankous’s fighters returned triumphantly alongside rebel forces from Idlib on 8 December 2024, only to find themselves systematically sidelined in the new national security architecture. As historic rivals of the now-dissolved Hay’at Tahrir al-Sham (HTS) faction that leads the new transitional government, FSA-affiliated fighters including Bitar’s Sham Liberation Brigade have been largely locked out of recruitment for the new national Syrian army, leaving thousands of former combatants unemployed and excluded from state support.
In interviews with grieving family members, almost all rejected the government’s claims that their sons held ties to IS. Ahmad al-Khattib, whose 21-year-old son Youssef was killed in his own living room after returning from dawn prayers, described a gentle young man who practiced taekwondo, danced at local weddings, and never even reprimanded his father for smoking, a behavior he noted would be unthinkable for a strict IS affiliate. Youssef had previously worked as an informant for HTS during the war, and briefly joined the new national army after Assad’s fall, but left after just a few months due to extremely low salaries and a deployment hundreds of miles away from his family. For 25-year-old victim Majd Suleiman, who was gunned down at the small local supermarket where he worked, his father recalled he had attended anti-regime protests from the age of 10, spent years in hiding to avoid Assad’s mandatory military conscription, and had never been accepted into the new army due to a lack of open positions. His long-planned wedding, scheduled for mid-November, was supposed to take place in the exact town square where his funeral was now held.
Local leaders say the transitional government has provided almost no resources for reconstruction in Rankous, forcing the community’s newly formed local development committee to fund all basic repairs for roads, street lighting, schools and mosques using only private resident donations. The World Bank has estimated total national reconstruction costs for Syria will reach $216 billion, a sum the transitional government has no current capacity to fund. Nihad al-Shahin, head of the Rankous local development committee, has called for a full, transparent public investigation into the raid, noting that even if authorities could produce verifiable evidence of alleged extremist ties, the heavy-handed, unannounced violent incursion was completely unjustified, and reflected the same oppressive security state mindset that defined the Assad era. As Syria approaches the second anniversary of Assad’s ouster, widespread unaddressed grievances among war-scarred former rebel communities across the country are creating vulnerable conditions that extremist groups like the Islamic State are actively seeking to exploit to rebuild their support networks.
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Spain’s rail authorities face European fraud probe after Urda rail disaster
The European Public Prosecutor’s Office (EPPO) has formally launched an investigation into potential fraudulent misappropriation of earmarked EU funds designated for safety, signalling and communications system upgrades on Spain’s Madrid-Seville high-speed railway, following two catastrophic crashes on the same line that claimed a combined 115 lives in 2024. Supported by a specialized unit of Spain’s Guardia Civil, prosecutors have already initiated on-site investigative actions at the headquarters of national rail infrastructure manager Adif and the national rail safety agency AESF.
The most recent disaster unfolded on 28 October, roughly 130 kilometres south of Madrid near the village of Urda, when a state-owned Renfe high-speed train collided at speed with the rear of a stationary private Iryo train that had been unable to resume operation. Investigators have confirmed that the critical LZB train position monitoring communications system suffered an outage prior to the crash, and the Renfe service was incorrectly authorised to proceed at full operational speed despite the stalled Iryo train positioned ahead on the track. The 69 fatalities from the Urda incident make it one of the deadliest rail disasters in 21st century European history, coming just nine months after a January crash at Adamuz on the exact same line killed 46 people and left dozens of passengers severely injured. This marks the second EU-level fraud probe into Spanish rail operations opened this calendar year.
The EPPO noted that the case carries exceptional public interest across both Spain and the broader European Union, but has declined to release additional operational details to avoid compromising the integrity of the ongoing inquiry. A dedicated Spanish judicial magistrate assigned to oversee the proceedings will ensure all investigative steps adhere to national legal safeguards, with explicit judicial authorisation required for any measures including residential searches or telecommunication surveillance.
The twin disasters have triggered massive public backlash and dealt a severe political blow to Prime Minister Pedro Sánchez’s Socialist-led administration, just weeks ahead of scheduled 29 November national parliamentary elections. Recent opinion polling shows Sánchez’s party trailing far behind the opposition conservative People’s Party (PP), with the PP and far-right Vox party arguing that the resignation of long-serving Transport Minister Óscar Puente – a close Sánchez ally who stepped down earlier this week after presiding over both fatal crashes – does not go far enough, and publicly demanding the prime minister step down as well. Widespread public distrust of high-speed rail services has already emerged across Spain, with reports of mass voluntary service cancellations and largely empty station platforms as passengers avoid travel on the affected and connected high-speed networks.
A formal state funeral for the 69 victims of the Urda crash will be held on Tuesday at Toledo Cathedral, located in the same province where the collision occurred. Newly appointed Transport Minister Carlos Cuerpo has publicly pledged to implement every necessary regulatory and operational adjustment to restore public confidence in Spain’s high-speed rail network, and met directly with survivors of the January Adamuz disaster on Friday, who presented him with a formal 11-point list of targeted safety improvement demands to prevent future catastrophic incidents. -
Turkey moves closer to Saudi troop deployment as parliament approves Mecca defence pact
In an early Friday legislative session, Turkey’s national parliament formally adopted the landmark Mecca defence pact, crossing the final major domestic legal threshold required for the country to formalize its membership in the trilateral security framework alongside Pakistan and Saudi Arabia. The historic bill secured 279 votes in favour, with 119 lawmakers casting opposing ballots. Unusually broad cross-chamber backing underpinned the passage: the ruling Justice and Development Party (AKP) and its nationalist coalition ally the Nationalist Movement Party (MHP) formed the core of the pro-treaty bloc, while even the nominally leading opposition Republican People’s Party (CHP) opted to support the measure, a shift widely attributed to internal upheaval within the party after a court-ordered removal of its former leader that split its caucus into two factions, leaving the new CHP leadership increasingly aligned with the Erdogan administration’s foreign policy priorities. The ratification process now moves to the desk of Turkish President Recep Tayyip Erdogan, who is slated to sign the legislation for publication in Turkey’s Official Gazette before the end of the week, at which point the accord will enter into legal force for Ankara. Originally signed by the three regional heavyweights during a high-level gathering in Mecca last August, the text of the 16-article, no-expiry defence pact enshrines a collective security clause stipulating that any armed aggression targeting the independence, sovereign status, or territorial integrity of one signatory will be deemed an attack against all three parties, with no specific nation or geographic bloc explicitly named as a pre-defined threat. The pact’s withdrawal provisions are unusually rigid: no member state may exit the alliance until a full 10 years have elapsed from the agreement’s official entry into force, and any party seeking to withdraw must provide a minimum of three months’ formal written advance notice to the other two signatories. Multiple diplomatic sources with direct knowledge of the negotiations confirmed to Middle East Eye that all three nations had previously committed to completing their domestic ratification procedures ahead of a scheduled trilateral summit later this month, with Islamabad and Riyadh both announcing their own full ratification last month, leaving Ankara’s parliamentary vote as the final outstanding step. Senior Turkish government officials have confirmed that the next immediate policy priority following the pact’s entry into force will be to secure separate parliamentary authorization to deploy Turkish military personnel to Saudi Arabia, a move framed as a defensive solidarity measure to support Riyadh in countering cross-border Houthi attacks originating from Yemeni territory. Turkish Foreign Minister Hakan Fidan emphasized last week that any Turkish troop deployment on Saudi soil will be strictly defensive in scope, with no operational mandate for Turkish forces to conduct missions inside Yemeni national territory. A separate diplomatic source also revealed to MEE that Ankara must still negotiate and ratify a dedicated Status of Forces Agreement (SOFA) with its two new alliance partners to resolve a full range of practical legal details, including delineating civil and criminal jurisdiction over deployed military personnel, setting entry and exit protocols for troops and equipment, establishing customs and taxation rules for military assets, outlining vehicle registration requirements, and formalizing day-to-day legal protections for deployed service members. As of press time, no public confirmation has been issued regarding whether negotiations for this accompanying SOFA have been finalized.
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AI stocks climb after trillions wiped from market values
Global financial markets witnessed a dramatic swing in performance across Thursday and Friday, as a brutal multi-trillion-dollar sell-off concentrated in artificial intelligence and technology equities gave way to a partial recovery on Wall Street, even as Asian and European benchmarks extended losses through the end of the trading week. The rout first ignited in US markets on Thursday, immediately following a sweeping Democratic victory in US midterm elections that handed the party full control of both chambers of Congress, plus key state-level contests in regions that have emerged as hotbeds for AI data centre construction. A wave of investor anxiety spread rapidly across trading floors, driven by widespread expectations that the incoming Democratic-controlled legislature would push forward with strict new regulatory frameworks governing AI development, data centre operations, and tech industry oversight. The sell-off hit AI-linked semiconductor manufacturers hardest of all: industry giants AMD and Micron saw their share prices plummet more than 17% apiece in Thursday’s session, while AI chip leader Nvidia shed over 9% of its value, wiping out hundreds of billions of dollars in total market capitalization in a single day. High-flying tech names with close ties to AI advancement, including Tesla and SpaceX, also suffered steep double-digit percentage losses in Thursday’s market rout. By the opening bell on Friday, however, Wall Street began to claw back a portion of those losses. The tech-heavy Nasdaq Composite index climbed steadily through the morning, stabilizing roughly 1.7% above its previous close by lunchtime to reverse nearly a third of its 5.5% Thursday decline. The broader S&P 500, which tracks the performance of America’s largest publicly listed corporations, traded 0.9% higher at midday, while the Dow Jones Industrial Average briefly dipped into negative territory in early trading before edging into positive gains. Individual AI-linked stocks mirrored this upward momentum: Nvidia opened Friday more than 6% higher before settling at a roughly 4% gain as trading progressed, AMD recovered around 12% of its lost value, Micron rose over 8%, Tesla notched a nearly 5% uptick, and SpaceX posted a more than 6% gain. This partial Wall Street rebound unfolded against the backdrop of unexpectedly robust US labour market data released Friday morning by the Bureau of Labor Statistics, which showed the US economy added 165,000 new jobs in October – a figure more than double the average analyst forecast and well above typical monthly job growth levels in recent months. The national unemployment rate also ticked down slightly to 4.1%, marking its 8th consecutive month of remaining within a tight 4.1% to 4.3% range dating back to March. In stark contrast to Wall Street’s partial recovery, major Asian and European markets closed deep in negative territory on Friday. South Korea’s benchmark Kospi index finished the session 6% lower, with domestic chip manufacturing leader SK Hynix seeing its share price collapse more than 10%. All major Western European indexes posted losses, with leading benchmarks in Germany, France, and Spain closing firmly in the red, while London’s FTSE 100 index declined 1.01% as UK market participants also digested the Bank of England’s latest interest rate hike, alongside official signals that additional monetary tightening could be implemented in coming months to curb persistent inflation. Market analysts offered cautious assessments of the volatility, noting that the full trajectory of AI stocks remains highly uncertain. Dan Coatsworth, head of markets at investment platform AJ Bell, described the preceding week as “brutal” for global equities, emphasizing that it remains unclear whether Friday’s partial US market rebound will prove sustainable. “While no-one knows what happens next, it’s clear that we’ve just seen a significant shift in market sentiment,” Coatsworth noted. “Once investors have had the weekend to catch their breath, next week could give a clearer indication of whether the tech trade is going down the pan or fighting back.” Russ Shaw, founder of global tech advocacy group Tech London Advocates, pointed out that the midterm election results signal a coming paradigm shift for AI oversight, and that tech firms have failed to effectively communicate the public benefits of their AI projects to local communities that are facing rising energy costs amid a boom in data centre construction. “The incoming Congress is going to really focus on AI in a very dramatic way,” Shaw explained. “I’m a big fan of AI, but I’m watching what these companies are doing, and they’re not communicating effectively at all, particularly in the US, about what the benefits of AI are all about… those companies have to be better neighbours.” For his part, US President Donald Trump took to public platforms Friday to restate his full support for what he termed “super intelligence”, arguing that only “foolish leadership” would reject the massive economic prosperity that AI advancement generates. Neil Birrell, chief investment officer at Premier Miton Investors, added that the stronger-than-expected jobs data suggests the real US economy remains far more resilient than recent market volatility would imply. “The US economy is running hard which may mean the risks the markets are worrying about at the moment are not such a risk to the real economy as is being feared,” Birrell observed.
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Dozens of Democrats eyeing 2028 presidential run, says former Obama aide
In the wake of the Democratic Party’s unexpectedly strong showing in the latest U.S. midterm elections, a veteran political strategist who masterminded former President Barack Obama’s 2012 re-election campaign has disclosed that more than two dozen high-profile Democratic figures are actively laying groundwork for potential 2028 presidential runs.
Jim Messina, who also served as Obama’s deputy White House chief of staff, shared his observations during an appearance on the BBC’s Americast podcast, noting that many of these prospective candidates have already launched preliminary operational steps: securing initial funding streams, recruiting core campaign staff, and even relocating key team members to support exploratory efforts for some high-profile gubernatorial hopefuls. Messina projected that the first formal announcements of presidential exploratory committees could come as early as the next two weeks, likely in the immediate aftermath of the Thanksgiving holiday.
While the pool of prospective candidates is currently large, Messina predicted it will narrow significantly in the coming months as contenders face the steep financial pressure of raising the massive war chests required to compete in grueling Democratic primary contests. He explained that in his private consultations with prospective candidates and their teams, he consistently presses them to articulate a clear, actionable economic vision for the country, with specific emphasis on policy frameworks for regulating and harnessing the growth of artificial intelligence.
A defining crossroads for all Democratic hopefuls, Messina argued, will be whether they allow their campaigns to become entirely consumed by responding to sitting President Donald Trump, or instead remain disciplined and centered on their own policy priorities. He went on to label the upcoming 2028 Democratic primary cycle the most fascinating presidential contest the party has navigated since the landmark 2008 race that first elevated Obama to the White House.
Messina attributed the party’s stronger-than-expected midterm performance to a rare display of message discipline: for the first time in years, Democratic candidates across congressional and state-level races avoided getting pulled into divisive partisan social culture war debates, and instead centered their platforms on pocketbook economic issues. This targeted messaging, he noted, allowed the party to flip long-held Republican seats in traditionally red states including Iowa, Kansas, and Texas, as campaigns highlighted the damaging impact of Trump-era trade tariffs on rural communities, where soaring costs for diesel fuel for farm equipment and everyday household goods left many voters disillusioned with incumbent Republican leadership.
Even amid these wins, Messina offered a note of caution to party leaders, emphasizing that the midterm results were not an unreserved public endorsement of the Democratic Party’s broader agenda. Instead, he argued that Trump himself was the de facto “most valuable player” of the Democrats’ midterm victory, as widespread voter frustration with his administration’s economic policies drove unprecedented turnout for Democratic candidates. The next major hurdle for the party, he added, will be bridging longstanding ideological divides between its progressive and centrist factions to pass cohesive legislative priorities in the new congressional session. -
Could the US midterms burst the AI bubble?
A wave of volatility has swept across global equity markets, leaving investors grappling with a pivotal question: is the historic artificial intelligence investment gold rush drawing to a close, or is the recent steep market downturn merely a long-overdue reality check for overheated valuations?
The most dramatic sell-off played out on the tech-heavy Nasdaq index last Thursday, home to industry giants including Nvidia, Apple, Meta, and Alphabet, erasing billions in market capitalization in a single trading session. The sharp correction came on the heels of a sweeping Democratic victory in the latest U.S. midterm elections, which handed the party full control of both chambers of Congress – a political shift that has sent shockwaves through the AI investment ecosystem.
Leading Democratic candidates across the country ran on platforms critical of unregulated, uncurbed data centre expansion, the very infrastructure backbone that has enabled the explosive growth of generative AI over the past two years. These campaign pledges have stoked widespread investor anxiety that sweeping new federal AI regulation is on the horizon, threatening the unconstrained growth trajectory that has driven the sector’s stratospheric valuations.
The current boom traces its origins to OpenAI’s late 2022 launch of ChatGPT, a product that ignited unprecedented mainstream and corporate enthusiasm for real-world AI use cases and kicked off the modern AI gold rush. Investors poured capital into every layer of the AI supply chain: advanced semiconductor manufacturers, high-speed networking infrastructure providers, utility companies powering energy-hungry data centres, and the generative AI developers themselves. The collective market value of large tech firms surged to historic peaks, with Goldman Sachs research projecting total global AI investments would hit a staggering $1 trillion annually by 2026. The sector’s insatiable appetite for capital was so intense that it pushed up borrowing costs for all other industries competing for limited global investment funds.
For months, however, quiet unease has been building among market participants about whether the AI sector can ever deliver on the outsize returns baked into current stock prices. These financial concerns have been amplified by high-profile warnings from leading AI researchers, who have publicly flagged unaddressed safety risks and even framed unregulated advanced AI as a potential existential threat to humanity – headlines that have only reinforced market fears of an imminent government clampdown.
While the Trump administration has embraced an unapologetically pro-AI agenda, referring to advanced AI systems as “super intelligence” and prioritizing unimpeded U.S. leadership in the space, Democratic candidates tapped into deep grassroots anger over the local impacts of data centre construction. Voter concerns centred on the facilities’ exorbitant water and electricity consumption, which residents feared would drive up household utility bills, alongside nuisances including constant operational noise, large-scale land appropriation, and widespread community disruption during construction. A May Gallup poll underscored the depth of this public opposition, revealing that 71% of U.S. residents would oppose a new data centre being built in their local community – a higher opposition rate than the 53% of respondents who rejected new nuclear power facilities in their neighbourhood.
Newly elected Texas state senator James Talarico, who flipped a long-held Republican seat to secure his victory, explicitly ran on this community scepticism. “While we are committed to preserving America’s global lead in artificial intelligence, we are still working through how this technology will reshape every part of life, from the future of work to how our children learn in schools,” Talarico stated. “We have a responsibility to protect American people, and to put clear, consistent, enforceable rules in place for businesses operating in this space.”
With full control of Congress, Democratic leadership is widely expected to push back aggressively against the Trump administration’s unregulated tech agenda, introducing new federal legislation designed to rein in uncurbed AI industry expansion. In Texas, governor-elect Gina Hinojosa has pledged to implement a full moratorium on new data centre construction, a policy that would directly challenge the operations of Elon Musk, who has relocated major portions of his SpaceX and Tesla manufacturing and administrative footprint to the once reliably red state. Musk poured nearly $450 million of his personal fortune into supporting Republican candidates during the midterm cycle, a bet that failed to pay off as Democrats made unexpected inroads across Texas.
As Tudor Brown, co-founder of UK-based semiconductor giant Arm Holdings, explains, “Public company stock valuations are always tied to projected future earnings, not current revenue.” If investors conclude that those projected future earnings will be significantly constrained by new regulation, a mass sell-off is the inevitable outcome. While the immediate trigger for the 24-hour market downturn was the midterm election results, warnings that leading AI-linked tech firms had become drastically overvalued had been circulating among analysts for months before voters went to the polls.
Market analysts remain divided on what comes next: some frame the correction as a healthy deflation of speculative froth from an over-exuberant market, while others warn it is the first crack in a massive AI investment bubble that could burst with cascading economic consequences. Nandini Roy Choudhury of Future Market Insights notes that investors will now conduct targeted reviews of how the new Democratic congressional majority could restrict data centre construction, mandate energy use limits, and impose new rules on AI deployment, meaning a broad, immediate rebound in tech stock prices is unlikely. Instead, traders will shift to far more selective investing, prioritizing firms with rock-solid balance sheets and proven near-term revenue streams. Arm’s Brown argues the downturn will be short-lived and limited in scope: he notes that share prices had been inflated by unrealistic expectations of near-infinite AI growth, and the recent sell-off is a predictable market correction driven by temporary panic. “There is a natural floor to how far these valuations can fall,” he observes. “Once that floor is hit, the market will recalibrate to reflect the simple reality that these companies are still generating massive, sustainable profits.” -
Four midterms takeaways for 2028 White House race
Even as final ballot tabulations for the 2026 U.S. midterm elections remain ongoing, the nation’s political ecosystem has already pivoted sharply toward laying the groundwork for the 2028 White House race, following historic Democratic gains across congressional and statewide offices that have handed the party significant momentum ahead of the contest to succeed sitting Republican President Donald Trump. Political history demonstrates that strong midterm performance does not guarantee a subsequent presidential victory: in 2010, the Republican Party secured massive congressional wins during former Democratic President Barack Obama’s first term, yet Obama went on to win a comfortable re-election two years later. No formal 2028 presidential candidacies have been announced to date, but a wide field of high-profile potential contenders from both major parties are already positioning themselves behind the scenes to vie for their respective parties’ nominations.
On the Democratic side, several rising stars posted decisive midterm wins that have supercharged their national profiles, even as many publicly downplay presidential ambitions. Georgia Senator Jon Ossoff secured a resounding re-election victory in the traditionally competitive battleground state that Trump carried in 2024, with a series of viral campaign moments elevating his name recognition far beyond state lines, despite his prior public statements ruling out a White House run. Pennsylvania Governor Josh Shapiro routed his Republican challenger to win re-election, cementing his reputation as a candidate with broad cross-partisan appeal in a critical swing state that all but guarantees him top-tier consideration for a national ticket. Illinois Governor JB Pritzker also claimed a clear re-election win, in a race that local political analysts widely described as a low-stakes warm-up for a potential presidential bid. While California Governor Gavin Newsom was not up for re-election this cycle, he spent significant political capital campaigning against a state ballot initiative that would impose new taxes on high-income California residents, a high-profile policy fight that has kept him at the forefront of national Democratic discourse.
For the Republican Party, the midterms delivered a series of underwhelming results that have sparked fierce internal debates over the party’s future direction, particularly for officials aligned with the Trump administration. Vice President JD Vance, whose public post-election analysis of Republican losses has been widely interpreted as the opening move of a prospective 2028 presidential run, has sought to distance himself from the party’s poor showing by blaming the defeat on the administration’s widely unpopular foreign policy intervention in Iran, writing on social media platform X that “the reason we lost is the war.” Leading political science professor Karen Beckwith of Ohio’s Case Western Reserve University noted that Vance has emerged as one of the biggest political casualties of the underperforming midterm cycle. Secretary of State Marco Rubio, another rumored 2028 hopeful, has publicly denied unconfirmed reports that he plans to step down from his cabinet post early to launch a presidential campaign. Other non-administration Republican figures have also stepped forward to critique the party’s missteps: Texas Senator Ted Cruz, who was not on the 2026 ballot, posted a lengthy statement on X arguing that Republican candidates failed to prioritize voters’ day-to-day economic struggles, writing that “it is dark right now, but it is always darkest before the dawn, and morning is coming.” Former 2024 presidential contender Florida Governor Ron DeSantis echoed that criticism, pointing to unbroken Republican dominance in Florida as a blueprint for how the party can rebuild its electoral coalition. Even in deeply conservative Arkansas, high-profile Republican officeholders Senator Tom Cotton and former Trump White House press secretary turned Governor Sarah Huckabee Sanders only managed to secure narrow re-election victories, with both earning just over 50% of the vote in a state that was once considered a solid GOP stronghold.
The Democratic Party is currently navigating a growing internal rift between its progressive and moderate factions, both of which are claiming credit for the party’s historic midterm gains. Left-wing progressive Democrats celebrated a breakthrough win in Michigan, where their candidate secured a statewide victory in a key battleground, a result that Progressive Change Campaign Committee co-founder Adam Green argued has shattered long-standing “electability” myths that previously warned left-wing populist candidates could not win in swing states. Green went so far as to suggest that the favorable electoral climate now makes a presidential primary run by high-profile progressive New York Representative Alexandria Ocasio-Cortez a viable prospect. Meanwhile, the party’s centrist Blue Dog Caucus of moderate and conservative-leaning Democrats gained at least 14 new congressional seats, nearly doubling its previous size, leading centrist Democrats to argue that pragmatic, cross-partisan candidates who run on collaborative governance platforms are the most effective way to peel off disaffected Republican voters in general elections.
The midterm results have upended decades of established U.S. political assumptions about safe partisan strongholds, most notably in Texas, where Democrats secured a historic gubernatorial victory that left only one remaining statewide Republican officeholder in the state. With Texas controlling 40 Electoral College votes, the once reliably red state is now widely viewed as a true battleground that will be fiercely contested in the 2028 presidential race. Political commentator Christina Pascucci, CEO of global advisory firm Atlas Global, noted that the results prove neither party can take its traditional base or long-held strongholds for granted, as both parties face a rapidly shifting electoral landscape where no group of swing voters can be claimed as a guaranteed partisan asset. Exit poll data shows that Trump’s 2024 electoral coalition of working-class and Latino voters eroded significantly in the midterms, reversing many of the inroads the Republican Party made with those demographic groups two years prior. Conservative political commentator Driena Sixto, a former spokesperson for Turning Point USA, argued that the Republican Party will need to overhaul its messaging to Latino voters ahead of 2028, noting that the administration’s heavy focus on deportation policies after taking office alienated many of the Latino voters who responded positively to the party’s 2024 campaign promises of safe communities and anti-human trafficking action. Across the board, analysts agree that Democratic candidates’ focus on cost-of-living issues drove much of their 2026 success, setting a clear precedent that economic policy will be the central pillar of most 2028 presidential campaigns for both parties, as candidates seek to appeal to the increasingly volatile and unpredictable electorate.