WSJ What’s News - Why Meta Is Buying Singapore-Based AI Startup Manus

Episode Date: December 30, 2025

Edition for Dec. 30. Meta becomes one of the first major U.S. tech companies to buy a startup with Chinese roots, as it agrees to acquire Manus for more than $2 billion. Plus, tensions in the Middle East as Saudi Arabia and the U.A.E. square off over their support for rival factions in Yemen. And WSJ chief economics commentator Greg Ip and White House reporter Meridith McGraw explain why “affordability” is likely to be a major talking point in next year’s midterm election campaign, and what politicians can do to address it. Luke Vargas hosts. Programming note: What’s News is publishing once a day through Jan. 2. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

If you're early in your career and looking for insight, inspiration, and honest advice, listen to the Capital Ideas podcast. Hear from Capital Group professionals about leaning into the differences that make you unique, making decisions that last, and what it means to lead with purpose. The Capital Ideas Podcast, from Capital Group, available wherever you listen. Published by Capital Client Group, Inc. Meta looks to Asia as it makes a more than $2 billion AI acquisition. We've got the scoop. Plus, tensions in the Middle East, Saudi Arabia and the UAE square off while protests break out in Iran. And in the U.S., why politicians on both sides of the aisle are scrambling to act on affordability.

This is going to be a big problem for Republicans moving forward. It's something that Democrats are really. centering their campaigns around. It's Tuesday, December 30th. I'm Luke Vargas for the Wall Street Journal, and this is What's News in your feed once a day over the holidays with the top headlines and business stories moving the world today.

We are exclusively reporting that META has agreed to buy Singapore-based AI startup Manus in a deal worth more than $2 billion. But it's not the price tag turning heads. Instead, the purchase marks a rare example of a major U.S. tech company buying a company with Chinese roots and developed in Asia's startup ecosystem. Journal reporter Kate Clark told us what made Manus an attractive target.

Meta is acquiring Manus to get further into the AI agent game, which is AI that can complete tasks for you. Manus has some really impressive technology there that sort of burst onto the scene in the past year or so. And this is a path that a lot of companies want to go down because this is AI that human beings actually want to use. And Metis, he's a huge opportunity for their business to use Manus and not just Manus's technology, but also the people that created this technology to really get ahead here. And Kate says Meta has made AI a huge focus this year, with a notable example

being its investment in Scale AI this summer, a deal that saw the startups founder Alexander Wang joined Meta as its chief AI officer. Well, it's been another busy trading day for metals with Silver Futures rebounding after a steep drop yesterday. Gold, platinum, and copper are also climbing. U.S. stocks are edging lower, though they remain close to record highs. And coming up at 2 p.m. Eastern, the Fed will release the minutes of its December policy meeting when it cut rates by a quarter point. Investors will be listening for how strongly those who disagreed with that move pushed back. The Fed will next meet in late January, with most traders anticipating a pause in rate cuts. Tensions are escalating between Saudi Arabia and the United Arab Emirates over the situation

in Yemen, where the Gulf powers are supporting rival sides in the country's civil war. Overnight, the Saudi military bombed in Emirati weapon shipment arriving at a Yemeni port, and today Riyadh warned the UAE it had 24 hours to leave Yemen and end support for forces in the country. The UAE said it would withdraw its remaining forces, though it's not. not immediately clear whether troops have begun to leave or whether that would resolve the crisis. The dispute between two key U.S. security partners could create complications for Washington. President Trump, who was joined in Florida by Israeli Prime Minister Benjamin Netanyahu

yesterday, has threatened new attacks on Iran should the country try to replenish its missiles or restart its nuclear program after U.S. strikes this summer. I hope they're not trying to build up again because if they are, we're going to have no choice, but very quickly to eradicate that buildup. Israeli officials and independent analysts say Iran is reconstituting its ballistic missile program, and Netanyahu is eyeing the resumption of military operations against the country. Meanwhile, Iran's regime is facing new internal pressure. Protests have broken out in response to a worsening economic crisis that's seen the Iranian

currency shed 60 percent of its value since June's war with Israel. That's undermined people's savings and raised costs as inflation grips the country, while water and power shortages add to the crisis. And L.A. is embracing rent control. Starting in February, rents on most of the city's apartments will only be able to increase by 1% to 4% a year, down from the current limit of 3% to 8% that dates back decades. Mayor Karen Bass, a Democrat, back the changes which come amid a deepening national debate over the effects of price controls.

And let me just say that we all know that the problem facing the nation and most certainly facing our state and city is affordability and at the core of affordability is the price of housing. Landlords and developers opposed the tightened rent controls, saying they'd make it harder to manage rising costs and attract investment. Coming up, we'll jump from L.A. to D.C. where affordability is shaping up to be a key campaign theme heading into a midterm election year. That's after the break. Midterm campaign season is practically upon us,

and with polling showing that voters say they view the economy negatively, affordability could emerge as a major talking point as Republicans try to hold on to the House and Senate. So what can a president do to address high prices in the first place and what moves could we expect to see in the months to come? To consider that, I'm joined by Wall Street Journal, chief economics commentator Greg Ip, as well as White House reporter Meredith McGraw.

Greg, President Trump, the mayor-elect of New York, Zoran Mamdani, and L.A.'s mayor, as we just heard about there, they've all been talking about affordability lately. What are they picking up on? Affordability is a somewhat vague word. It doesn't just refer to the cost of what you buy, but also the income, the resources you have to buy those things. If you actually look at the data, there isn't a lot going on with affordability to freak out about. Inflation, when Biden left office was around 3%. Today, it's still around 3%.

Incomes are growing about 3.5% to 4%, depending on the measure that you use. So by that very basic measure, affordability is improving. People's incomes are growing faster than prices. The reason I think it has become a buzzword is that a lot of folks were shocked by how much prices went up in the initial aftermath of the pandemic. And they still are hoping that prices will actually go down for outright deflation, which is for prices to fall. And historically, that almost never happens except when we're in a depression. And it's not going to happen now. I guess people also voted a new president expecting change, expecting new policies in Washington to maybe break the pattern there that you talked about of inflation of around 3% carrying through from Biden to Trump. Well, yes, Trump was happy to campaign on the affordability crisis accusing Biden of presiding over the highest inflation in history. That was not true. Saying things like the price of bacon that had gone up four or five times, that was not true. I mean, there's a lot of research to suggest it was probably the number one reason that Trump was able to do. defeat Kamala Harris last fall. But, you know, you live by the sword, you die by the sword.

People are saying, wait a minute, why are prices still going up? And they're saying, Mr. Trump, this is your economy now. Where's the beef figuratively and literally speaking? Meredith, this is a perceptions game, politics. It matters what people feel. And the polling shows this is a potential vulnerability for those in office. President Trump talks all the time about how prices are coming down or America's economy is the envy of the world, but that just doesn't line up with how a majority of Americans actually feel day to day. I recently talked to the president about this, and he acknowledged that affordability is an issue in the upcoming midterms, and he talks about the investments he's brought to the U.S., the fact that it'll take some time for voters to feel

their effect or that he thinks prices will be in better shape in the next half of the year. But this is going to be a big problem for Republicans moving forward. It's something that Democrats are really centering their campaigns around. Greg, what could President Trump do to tackle the affordability crisis? I'll start off with one thing that he could not do, which is to raise tariffs. There's a lot of debate about how much tariffs have added to inflation, but there's not much debate that the number is positive, and that if you stopped imposing tariffs, you would probably have lower inflation. And the president himself implicitly acknowledged that by rolling back some tariffs, such as on coffee and bananas. There are things you can do on the income side,

and the president is indeed doing some of those. We are going to see the tax provisions of the Republicans' megabill from this past summer kick in. And that will include things like a reduction of taxes on tips, on people over the age of 65, things like tax deductibility for certain automobile leases, expanded deductions for state and local taxes, and so on. So to the extent that raises some people's after-tax incomes, that'll help with affordability. Meredith Gregg has previewed there a few options the president has. What are you hearing about? One of the things I did ask him is if he would lower tariffs on any additional goods, but he wouldn't say. But we have heard Treasury Secretary Bessent say that there could be refunds from the tax cuts in Trump's big bill.

And, you know, they've tried to do things like aid packages for farmers. they've cut back certain regulations, and a big thing for Trump, too, are some of these investments that he's bringing to the U.S., and I think we're going to see more of those in the coming year. But when we'll actually see that have any notable change or impact how voters feel about anything, I think, is yet to be seen. I've been speaking to Wall Street Journal, Chief Economics commentator Greg Ipp and White House reporter Meredith McGrath. Greg, Meredith, thank you both so much. Thanks for having me. Thank you.

And that's it for What's News. Today's show was produced by Pierre Bienname and Julie Chang with supervising producer Polly Arbell. And I'm Luke Vargas for the Wall Street Journal. Heads up, we'll be publishing just one show a day through Friday. We'll be back with a new show tomorrow. And as always, thanks for listening. Thank you.