AI Has an Insurance Problem

SPEAKER_1 (0:00)

Data alone is just data. Connect it and possibility amplifies. Octave is a software company that transforms data into life cycle and contextual intelligence for the world's mission critical industries. Welcome to Intelligence, proven at scale, Octave.

Luke Vargas (0:18)

US-Mexico trade talks hit a roadblock in Washington. Plus, Tesla's new Roadster takes flight, literally.

And we'll look at A.I.'s next big obstacle, insurance.

Jean Eaglesham (0:31)

The worry is that the sheer growth of the industry means the claims are potentially outpacing the coverage limit, particularly for the labs developing this technology.

Luke Vargas (0:41)

It's Friday, October 16th. I'm Luke Vargas for the Wall Street Journal. And here is the AM Edition of What's News, the top headlines and business stories moving your world today.

Commerce Secretary Howard Lutnick has thrown a wrench in U.S.-Mexico trade talks, stalling progress toward a potential tariff deal. We're exclusively reporting that Lutnick won't agree to lower tariffs on Mexican steel, aluminum, and automobiles, which all fall squarely under his directive as Commerce Secretary. Journal trade reporter Gavin Bade has more.

Gavin Bade (1:15)

So for weeks, the US and Mexico had been zeroing in on a deal to reduce some of these levies. US tariffs on steel and aluminum currently sit at 50 percent, while US tariffs on Mexican automobiles are at 25 percent. In particular, Lutnick and some of his allies in the domestic aluminum sector in the US have objected to lowering tariffs on what are called derivative products, finished goods that are made from steel or aluminum, and they are responsible for the vast majority of the jobs in the US aluminum sector. And so they've kind of drawn a hard line at not reducing those tariffs under 50 percent. Obviously, the Mexican government is not very happy with that outcome.

Luke Vargas (1:55)

On cars, Mexico is hoping to lower a 25 percent tariff to the 15 percent levy enjoyed by Europe and some East Asian countries, but Gavin says that's also facing resistance from Lutnick.

Gavin Bade (2:07)

And now what we're hearing from sources is that prospects for an agreement are not very good before the midterm elections here or maybe even before the end of the year.

That throws the U.S.-Mexico trade relationship even into further doubt. This narrow tariff deal on steel, aluminum and autos, it was supposed to pave the way for larger discussions on renewing the U.S.-Mexico-Canada agreement or at least renewing it for US and Mexico. All of those things are now in doubt. So we'll just have to watch this space and see if they can get this over the line in the months to come.

Luke Vargas (2:40)

The Justice Department is suing California to block the state from counting mail-in ballots from some 20,000 voters that the Trump administration claims may not be US citizens. Filed less than three weeks before the midterms, the lawsuit seeks an injunction against counting those ballots until citizenship status can be verified. California Secretary of State Shirley Weber pushed back, arguing that the federal government provided no basis for its suspicions and calling the legal action an emergency of the Justice Department's own creation as statewide voting gets underway.

Meanwhile, voters' economic concerns are putting intense pressure on Republicans across an expanding battleground map. The nonpartisan Cook Political Report predicts that Democrats could flip nine to nineteen House seats more than enough to erase the GOP's current five-seat majority. However, local dynamics present a more complex picture, as seen in New Hampshire, where Republican Governor Kelly Aod is holding on to a steady lead in the typically blue state.

Across the border in Maine last night, Republican Senator Susan Collins and Democrat Troy Jackson held their final debate in one of the nation's most closely watched Senate races. The two clashed over skyrocketing utility bills, with Jackson citing high fuel costs linked to the war in Iran, while Collins fall to the state's Democratic leadership.

Troy Jackson (4:03)

So, you know, Senator Collins keeps on talking about how our electric rates have risen. She doesn't want to talk about how our oil rates have risen.

SPEAKER_6 (4:11)

Thank you. And Senator Collins.

Susan Collins (4:12)

Every state is affected by the war in Iran's impact on oil. Not every state has the high electric rates that Maine has.

Luke Vargas (4:28)

The Maine race is one of seven Senate battles that the Cook Political Report rates as a toss-up. Six of the seven are currently Republican-held.

Well, as promised, Fed Chairman Kevin Warsh is holding firm in his refusal to signal the Central Bank's next rate move. Here he was speaking to the head of the IMF at its annual meeting in Bangkok, where their microphones might benefit from some repositioning.