On CNBC's Squawk Box, Scott Bessent said artificial intelligence developers "need to take responsibility for themselves" instead of looking to Washington for a "liability shield." Asked if he backed President Donald Trump's stance against imposing new regulations on the young industry, he answered, "It is humans who are responsible, not the AI."
His comments arrived as some AI executives warn about fast-advancing models, even as Trump backs the expansion of AI companies and U.S. data centers. Bessent said U.S. and Chinese officials discussed creating a channel to handle AI incidents "so both sides can agree on what the leading AI dangers are, whether it's uncontrollable agents, whether it's non-state actors in cyber, non-state actors in bio weapons."
According to Bessent, he and Chinese Vice Premier He Lifeng spent 12 hours together on Sunday before Trump's meeting in Washington later this week with Chinese President Xi Jinping. The two covered AI and formalized talks that will likely continue in Shenzhen later this year, where the Asia-Pacific Economic Cooperation summit is scheduled for November.
A "focal point," he said, was the looming expiration of the temporary U.S.-China trade truce on Nov. 10. He added that Trump plans to meet Xi planeside at Maryland's Joint Base Andrews, saying, "I think we're going to have a great visit."
Bessent said Iran came up in his weekend conversations as he leads the U.S. push to strangle Tehran's economy by sanctioning its financial enablers, though he offered no details. Meanwhile, concern over fuel and other everyday costs has Republicans nervous about keeping their congressional majority in November.
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Bessent discussed the Federal Reserve's move last week to enact its first rate hike since 2023. The Federal Open Market Committee unanimously lifted the benchmark to a 3.75% to 4% target range to address "elevated inflation." Having appointed Fed Chairman Kevin Warsh and long pushed for rate cuts, Trump said he had spoken with Warsh before the vote and told reporters, "You might as well vote with the board. It's not going to matter.'"
Bessent forecast that rates will ease when the Iran war concludes. "Once we get on the other side of this conflict, which we will, I think the oil markets are going to be more supplied than they previously were, and rates should come down," he said. He also pointed to a Sept. 10 Treasury buyback exceeding $5 billion in 10-year and 20-year notes. In Sept. 15 House testimony, he called the buyback "successful," adding, "There was the counterfactual of what it would have done." He also said, "Since President Trump has come in, [the U.S. bond market] has been the best-performing bond market in the developing world."
From the start of the war against Iran in late February, the 10-year Treasury yield has risen roughly 100 basis points and climbed past 5% last week, a level not seen since 2007. That benchmark influences long-term borrowing costs, including mortgages, which hit 7% this month, the highest in over a year. The surge in yields has come alongside sharply higher diesel prices tied to the war.
Bessent also defended Trump's Friday decision to block MS NOW, CNN, and Politico from the White House. He initially said he knew little about it, then argued "perceived bias" in the "legacy media" has hurt its popularity. "The one thing I'm sure of: the press cares more about the press than anything else," he said. The three outlets plan to sue Monday on First Amendment grounds.
What matters for your money: rate relief hinges on the Iran conflict resolving, bond markets are digesting buybacks and higher yields, and Washington and Beijing are trying to reopen AI lines while a trade truce deadline approaches. You will feel it most in mortgage quotes, fuel receipts, and price tags where you shop.
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