The head of the Turkish Banking Regulatory and Supervision Authority (BDDK), Shihab Kavcioglu, said on Wednesday that he asked President Recep Tayyip Erdogan to accept his resignation, against the backdrop of accusations linking the authority to the investment funds crisis in the country, denying the validity of those accusations.
Kavcioglu, who served as governor of the Turkish Central Bank between 2021 and 2023, explained in a post on the “X” platform that he requested to be allowed to step down “in light of the recent accusations related to the Banking Regulatory and Supervision Authority and myself,” adding that he took this step so that “the authority would not be exposed to further harm.”
On Wednesday, the opposition newspaper Sozcu quoted Kavcioglu as denying reports circulated by Turkish media that he owned money invested in funds under investigation or received bribes, stressing that the authority had nothing to do with the funds crisis.
The resignation request came after the arrest of senior officials in the authority over the weekend, and then their imprisonment pending investigation, as part of an investigation related to transactions in capital markets that included investment funds.
In September, regulators ordered the liquidation of 131 funds managed by seven asset management companies, after some of them warned of their inability to meet investor recovery requests.
The assets of these funds exceeded $20 billion in just three years, with about half a million investors, including politicians, former officials, and celebrities, seeking to achieve high returns to compensate for the decline of the Turkish lira and high inflation.
European stocks rose at the beginning of trading on Wednesday, approaching record levels, supported by strong performance expectations from the German “Siemens Energy” and the American “Corewave”, which contributed to allaying concerns about the prospects for investment in artificial intelligence, despite the continued pressures resulting from inflation risks.
The European Stoxx 600 index rose 0.7 percent to 662.83 points by 08:07 GMT, slightly closer to its record levels recorded in August, according to Reuters.
The shares of Siemens Energy, which specializes in artificial intelligence and energy equipment, jumped by 6.5 percent, amid expectations that its profit margins will improve in 2027. The company announced plans to more than triple dividends.
Shares of its competitors, Schneider Electric and LeGrand, rose by about 2.6 percent each, while the broader technology sector index rose by 1.7 percent.
In the cloud computing sector, Corowave announced that it expects to achieve profits on an adjusted basis during the first half of 2028.
On the other hand, shares of the Danish wind turbine manufacturer Vestas fell by 6 percent, being among the biggest losers on the index, after it announced operating profits for the third quarter that fell below market estimates.
The shares of the Czech company CSG, which specializes in the production of ammunition and weapons, also fell by 18 percent, after lowering its expectations for operating profit margin for the full year.
The recovery of Brent crude prices, following attacks targeting ships in the Strait of Hormuz, led to increased investor caution, a day after the release of US inflation data that exceeded expectations, strengthening market bets on the Federal Reserve raising interest rates in December.
American technology companies are entering a more complex political phase after the Republicans lost the midterm elections, as their proximity to the White House is no longer sufficient to ensure that artificial intelligence continues to expand at the same pace. As public anger mounts over the cost of this expansion, companies are facing pressure to renegotiate the terms of their growth and the distribution of its benefits, at a time when Democrats are preparing to tighten oversight.
But the transformation does not go in one direction. California voters rejected a tax on the wealth of billionaires, and President Donald Trump has expressed a willingness to accept controls, provided that China is not given preference. Between these signs, the “honeymoon” based on direct access to power declines, and more difficult negotiations begin on the conditions for continued expansion and the limits of companies’ influence.
Protection is no longer enough
According to a report by the Washington Post, investors and technology officials close to the Democrats have begun searching for an approach that gives local communities a greater voice and direct benefits, after the sector was dominated by the policy of building at full speed. Ideas include funding schools and training programs, using union labor, protecting residents from high electricity bills, and even accepting the slowdown of some projects.
The newspaper quotes Jay Carney, a former spokesman for President Barack Obama and a partner in an investment company, as summarizing the problem in that residents feel that transformation is being imposed on them without their participation. As for Chris Lehane, Global Affairs Officer at OpenAI, he believes that addressing energy, water and noise consumption is no longer enough, and that communities have the right to use their power over projects to extract tangible benefits.
However, reducing the election results to a rejection of artificial intelligence involves exaggerating its interpretation. According to the Associated Press, about three-quarters of voters opposed the establishment of a data center in their communities, but only about a quarter considered the issue decisive in their vote for Congress, and it came behind issues of corruption and the cost of living. This shows that the objection is strong, but does not amount to a national mandate to stop the technology.
The difficulty for companies is that presidential protection alone does not address local objections. Even if federal legislation falters, water and electricity permit battles can delay and increase construction costs. Therefore, negotiation with the states and the population becomes an operational and political necessity, and not just an image improvement campaign.
California draws borders
California provides evidence of the complexity of the electoral mood, after its voters rejected Proposition 40, which would have imposed a one-time 5 percent tax on the wealth of billionaires. According to the Associated Press, the proposal was opposed by Democratic Governor Gavin Newsom, while progressive Senator Bernie Sanders and a union for health care workers supported it, with the aim of compensating for cuts in federal funding.
In the next Congress, which will be controlled by Democrats, the priorities will not be identical. Reuters reported that Senator Chuck Schumer intends to make protecting consumers from the high energy costs associated with data centers a priority, while Representative Lori Trahan is pushing for advanced models to be subjected to independent tests, and to clarify companies' responsibility for damages. Representative Zoe Lofgren calls for responsible regulation while encouraging innovation.
These situations open the door to settlement, but they do not make reconciliation automatic. Investigating companies' relationships with management and donations to the president's projects is a different path than regulating their products. Companies may accept new operating rules and then face embarrassing accountability for the way they have used their influence over the past two years.
China adjusts the equation
Competition with China remains the sector's strongest argument in the face of measures that may hinder its expansion. In an interview with the “60 Minutes” program broadcast on Sunday, November 8, Trump said that he does not mind setting controls, but he does not want regulation that puts the United States in second place, far from China. His statement provides room for negotiation with the Democrats, while maintaining American superiority as a condition for any understanding.
However, a distinction is necessary between modifying the tools of competition and retreating from its goal. The Trump administration allowed the review of requests to export H200 chips to China with conditions, after American customers were moving to newer generations. When announcing the decision, Trump confirmed that he excluded the latest generations, “Blackwell” and “Rubin,” to keep American companies ahead in the computing power needed to develop artificial intelligence. His declared system is to employ the technological difference to support American companies, while protecting national security.
Recent estimates by Epoch AI, a research organization specializing in measuring the development of artificial intelligence, support the existence of a significant difference in computing power. The United States accounted for about 72 percent of the new capacity tracked by the organization between 2022 and mid-2026, compared to about 10 percent for China, including its domestic production. The Foundation adds that these numbers estimate flows of computing power, and do not represent a permanent guarantee of excellence in all areas of artificial intelligence.
Although this reality makes it more likely, from a political standpoint, that American leadership will continue to be supported across both parties, agreement on the goal does not determine the means. Democrats may see that protecting superiority requires stricter restrictions on exports, in parallel with stronger internal oversight, rather than granting companies greater freedom in both cases.
Settlement on new terms
The historical precedents associated with fear of machines, computers, and the Internet are not enough to consider the current objection merely a resistance to progress. Today, concerns about job losses overlap with measurable issues: Who bears the cost of expanding networks? Who gets water? How are the gains distributed? Addressing these questions may help protect investment from stronger political reaction in the future.
Market turmoil cannot be attributed to electoral rhetoric alone, as Reuters noted that concerns about regulatory tightening overlap with doubts about the return on massive spending on artificial intelligence. The agency reported on Tuesday that bond investors were increasingly wary of debt linked to the sector, making any potential slowdown the result of intertwined political and financing factors.
According to the Washington Post, companies are more likely to find democratic partners, but at a higher price and clearer terms. The newspaper quotes Democratic Representative Sam Liccardo, who represents part of Silicon Valley, as summarizing the impasse, as he warns against settling for hearings and blaming CEOs without offering solutions. Democrats need results before the 2028 elections, and companies need social acceptance to ensure construction continues.
The “honeymoon” may be over, but the likely alternative is a more difficult negotiation over the distribution of benefits and responsibilities. Mahsum does not agree to curb technology.
