Morgan Stanley to Increase Sale of Loans Tied to Musk’s X Amid Strong Demand

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Morgan Stanley, leading a group of banks, is set to increase the sale of loans linked to Elon Musk’s social media platform X, following stronger-than-expected demand from investors, according to Bloomberg News on Tuesday. Initially, the banks had planned to sell around $3 billion in loans, but the revised target now stands at up to $5.5 billion, reflecting investor interest that exceeded expectations.

In November, reports indicated that Musk’s rising political influence and connections to former President Donald Trump played a role in improving prospects for the platform, which helped banks manage the debt sale without incurring heavy losses. Morgan Stanley, along with other financial institutions like Bank of America and Barclays, provided Musk with loans in 2022 to support his $44 billion acquisition of X, formerly known as Twitter.

Typically, banks sell such loans to investors shortly after a deal is finalized, but the process has been more challenging in the case of X. Despite this, the latest demand suggests a more favorable outcome for the banks involved.

Nintendo Lowers Switch Sales Forecast Ahead of New Console Launch

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Nintendo (7974.T) has reduced its full-year sales forecast for the Switch console by 12%, now projecting only 11 million units sold as the device faces waning momentum ahead of the release of its successor later this year. Despite the decline, Nintendo remains focused on its console business, alongside its ventures into physical stores and expanding its brand with theme parks and films.

Nintendo President Shuntaro Furukawa acknowledged that while hardware and software sales remained solid for the eighth consecutive year, the company failed to meet its initial sales goals. For the period from April to December, Nintendo sold 9.54 million Switch units, bringing total sales to 150.86 million units.

The company previously announced plans to launch a successor to the popular Switch in 2025, with the unveiling scheduled for an upcoming Nintendo Direct event on April 2. The new device is expected to retain the hybrid design of its predecessor, which significantly revived Nintendo’s fortunes after the underperformance of the Wii U console.

As a result of the forecasted slowdown, Nintendo has lowered its operating profit estimate by 22.2%, bringing the expected figure to 280 billion yen ($1.8 billion) for the financial year ending in March. For the April-December period, the company saw a sharp 46.7% drop in profit, totaling 247.6 billion yen.

 

EU Announces Guidelines to Prevent AI Misuse by Employers, Websites, and Police

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The European Commission unveiled new guidelines on Tuesday aimed at curbing the misuse of artificial intelligence (AI) in various sectors, including employment, online services, and law enforcement. As part of the European Union’s broader AI regulations, the guidelines prohibit practices such as using AI to track employees’ emotions or to manipulate consumers into spending money online.

The guidelines are part of the EU’s Artificial Intelligence Act, which, while legally binding since last year, will be fully enforceable by August 2, 2026. Some provisions, such as those concerning specific AI practices, take effect earlier, including the ban on deceptive AI practices from February 2 this year.

Prohibited practices under the guidelines include the use of AI to create “dark patterns” on websites designed to manipulate users into making financial commitments, as well as AI applications that exploit individuals based on factors like age, disability, or socio-economic status. Additionally, social scoring systems that use personal data, such as race or origin, to categorize individuals are banned, alongside the use of biometric data by police to predict criminal behavior without proper verification.

Employers are also restricted from using surveillance tools like webcams or voice recognition systems to monitor employees’ emotions. The guidelines further prohibit the use of mobile CCTV cameras equipped with facial recognition for law enforcement, except under strict conditions with safeguards in place.

The EU has given member countries until August 2 to designate market surveillance authorities to enforce these AI rules. Companies found in violation could face hefty fines ranging from 1.5% to 7% of their global revenue. This comprehensive regulatory framework contrasts with the United States’ voluntary compliance approach and China’s focus on maintaining social stability through state-controlled AI.