Archive for February, 2025

• Morning News: February 18, 2025
  Eddy Elfenbein, February 18th, 2025 at 7:01 am

  Xi’s Embrace of China Tech CEOs Spurs Hope of Big Economic Shift

  Xi’s Tech Meetup Is a Bullish Sign for China’s Economy

  ASEAN Nations Needs a Supergrid to Meet Climate Goals

  Kurdistan Oil-Export Resumption Could Pose Challenges for Iraq

  Europe’s Natural Gas Euphoria Masks a Gloomy Reality

  World Bank to Decentralize Operations, Shift Regional VPs to Overseas Hubs

  There’s No Template for the Shock Europe Just Got

  Trump and Putin Teams Meet in Saudi With Europe Sidelined

  Trump Isn’t Playacting When He Invokes Napoleon

  Former Staffers Say India’s Biggest IT Firm Was Gaming the US Visa System

  The World’s Most Important Market Sends a Warning

  Can the Fed Look Past Trump’s Tariffs?

  Fed Wanted an Inclusive Jobs Recovery. Some Are Asking If That Helped Fuel Inflation

  At the ‘Wall Street of Eggs,’ Demand Is Surging

  No, Elon Musk Hasn’t ‘Discovered’ Fraud at Social Security

  Republicans Want Lower Taxes. The Hard Part Is Choosing What to Cut.

  JPMorgan Set to Relive ‘Huge Mistake’ at Javice Fraud Trial

  Musk Debuts Grok-3 AI Chatbot to Rival OpenAI, DeepSeek

  Cisco and IBM Show Old-School Tech Names Can Be AI Winners Too

  With AI Friends Like These, Who Needs Humans?

  Diamondback Energy to Acquire Double Eagle

  Scania Agrees to Buy Northvolt’s Heavy Industry Battery Business

  United Rentals Drops $3.4 Billion Purchase of H&E Equipment

  The Startup That Stepped In When the Baby Formula Supply Chain Broke

  ‘Gut Pop’ Is Injecting New Fizz Into the Beverage Aisle

  Heineken CEO Aims to Tap Into Thirst for Zero-Alcohol Beer

  China’s Love Affair With Luxury Has Cooled

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• Morning News: February 17, 2025
  Eddy Elfenbein, February 17th, 2025 at 7:06 am

  The Transatlantic Alliance as We’ve Known It Is Dead

  Trump’s New World Order Leaves Europe Flailing

  Ukraine Ceasefire Hopes Offer Europe’s Markets a Tailwind in the Shadow of Tariffs

  Trump Proposals Would Cut German Growth, Bundesbank’s Nagel Says

  Trump Leads US Down the Foggy Road of Reciprocal Trade

  How Trump’s One-for-One Tariff Plan Threatens the Global Economy

  India Plans More Tariff Changes to Curb Trump’s Trade Threats

  Milei Stumbles Into Crypto Memecoin Scandal Before US Trip

  Trump’s Phone Call With Putin Is Causing a Stir in Taiwan

  Xi Voices Support for Jack Ma, China Private Sector Chiefs

  Wall Street’s China Plans in Tatters After Years of Setbacks

  From Japan, a Hard Lesson About a Weak Currency

  Japan Economy Grew Faster Than Expected in Final Quarter of 2024

  Five Iraqi Banks to Be Banned from US Dollar Transactions

  Trump Wants to Bring Down Treasury Yields. Here’s What to Know.

  Musk’s DOGE Team Tries to Gain Access to Taxpayer Information

  Bain Capital Ends Pursuit of Fuji Soft

  OPEC+ Considers Delaying April Supply Restart, Delegates Say

  California Insurer of Last Resort Went Bust. It Won’t Be Alone.

  Posting Through It: Climate Change Is Fueling Social Media Use

  Anglo American to Retain 20% Stake in Demerged Platinum Business

  South Korea Bans Downloads of DeepSeek, the Chinese A.I. App

  Why Did Microsoft Admit That AI Is Making Us Dumb?

  Shein Is Said to Face Investor Pressure to Slash Valuation to $30 Billion

  Dry January Is the Least of Big Booze’s Problems

  One Fix for Ailing Movie Theaters? Becoming Nonprofits.

  Why Porsche Is No Longer a ‘Premium’ Sports Car in China

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• Morning News: February 14, 2025
  Eddy Elfenbein, February 14th, 2025 at 7:01 am

  In Europe, Ordinary Russians Are Shunned By Wary Banks

  America First? For Europe, It’s America as Usual

  Trump Officials Ordered by Judge to Lift Freeze on USAID Funding

  China’s Central Bank Signals Policy Adjustments Amid Rising Global Risks

  Trump Is Newly Unleashed on Trade, With Global Consequences

  Trump’s Reciprocal Tariff Policy ‘a Step in the Wrong Direction,’ EU Says

  What Are the Reciprocal Tariffs Trump Is Promising?

  Whiskey Offers Window Into the Pain of a Trade War

  Tariff Man Strikes Again — And Markets Ignore Him

  Why Investors Appear Unfazed by the Latest Trump Tariffs

  How Torsten Slok Solved the ‘Sherlock Holmes Mystery’ of the Economy

  Traders Look for $10 Million Payout in Bet on 5% US Yield

  Goldbug FOMO Is Setting Up the Market for a Fall

  Trump’s Push to End Pennies Offers Money Lessons from Collectors

  Trump Tax-Cut Push Kicks Off With Much-Worse Deficit This Time

  ICE Raids Send Chill Through Migrant Workforces

  Back Up Everything. Even if Elon Musk Isn’t Looking at It.

  The Unicorn Boom Is Over, and Startups Are Getting Desperate

  DeepSeek Doesn’t Scare OpenAI, Thanks to the ‘Jevons Paradox’

  The Tulip’s Quiet War on Roses: A Valentine’s Day Battle

  ‘You’ve Blown a Hole in the Family’: Inside the Murdochs’ Succession Drama

  Boeing’s Push to Boost 737 Production Starts With Closing ‘Shadow Factory’

  Umicore Shares Fall After Dividend Policy Reset

  Walmart Is Retail King Again. Can It Keep the Crown?

  Birkin Bag Maker Hermes Posts Higher Revenue on Strong Americas Performance

  A Libertarian Island Dream in Honduras Is Now an $11 Billion Nightmare

  The NBA Has Fallen Into an Efficiency Trap

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• Morning News: February 13, 2025
  Eddy Elfenbein, February 13th, 2025 at 7:06 am

  Trump’s Ukraine Deal Looks Great — for Putin

  Trump’s Ukraine Plans Mean a $3 Trillion Bill for European Allies

  Germany Requests Exemptions From Gas Storage Filling Target

  Taiwan Prepares for Trump’s Tariffs, and a Changed Washington

  Trump Vows Reciprocal Tariffs Today Without Giving Details

  Chaotic USAID Shutdown Costs Intensified by Wasted Supplies, Layoffs and Lawsuits

  ‘Deregulation by Firings’: Breaking Down the Cuts to Financial Oversight

  With Attack on Consumer Bureau, Musk Removes Obstacle to His ‘X Money’ Vision

  Republicans Love Trump’s Spending Cuts. Just Not in Their States.

  A.P. Accuses White House of Violating First Amendment

  How Elon Musk and the Right Are Trying to Recast Reporting as ‘Doxxing’

  Top N.I.H. Official Abruptly Resigns as Trump Orders Deep Cuts

  Bird Flu Is a Big Threat. The US Needs to Start Acting Like It.

  Eggs-istential Inflation Scrambles Bond Markets

  US Bonds Rise After Hot Inflation Fuels Worst Day Since December

  Inflation Expectations Are Back in the Debate Over Fed Rates

  Inflation Helped Trump Get Elected. Now It’s His Problem.

  Why 10-Year Yields Are on the Treasury Secretary’s Mind

  The Secretive Hedge Fund Rewriting the Rules of $4.5 Trillion Industry

  As Buyers Fail to Show Up, More Homes Are Being Pulled From Sale

  How Silicon Valley Swung From Obama to Trump

  Quantum Computing Is Closer Than Ever. Everybody’s Too Busy to Pay Attention.

  Apple’s Stock-Market Performance Is Increasingly Made in China

  Honda and Nissan Scrap $50 Billion Merger Plan

  Unilever Picks Amsterdam Over London for Ice Cream Unit’s Primary Listing

  Japan Perfected 7-Eleven. Why Can’t the US Get It Right?

  SharkNinja CEO Says There’s No Supply Chain for US-Made Blenders

  Crocs 4Q Results Beat Estimate with Lift from Heydude Brand

  As Salaries Boom, It’s a Good Time to Be an N.F.L. Coach

  Your Stolen Car Is In a Shipping Container, Bound for Africa

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• Morning News: February 12, 2025
  Eddy Elfenbein, February 12th, 2025 at 7:03 am

  European Defense Startups Drive $5.2 Billion Funding Spree in 2024

  Milei’s Plan to Boost Farm Exports: Stop Ships From Running Aground

  China’s Property Crisis Enters a Dangerous New Phase

  How China’s Growth Headwinds Shape Its Response to Trump

  What Modi and India Can Offer Trump on Tariffs and Trade

  Why Trump Hit the International Criminal Court With Sanctions

  Trump Advisers Look to Shift US Foreign Aid to Wall Street Ally

  America First Is Quickly Becoming America Alone

  To Win the Global Money Game, America Has to Play

  Who Pays for Tariffs (Hint: It’s most often not other countries.)

  A Hot Inflation Print Is Set to Derail S&P 500’s Run to Record

  With High Prices Persisting, Trump Tempers Tone on Slaying Inflation

  How Car Insurance Would Help Tariffs Cast a Long Inflation Shadow

  Activist Breakup Wins Should Rattle Size-Obsessed CEOs

  Elon Musk in the Oval Office

  Fearing Trump, Wall Street Sounds a Retreat on Diversity Efforts

  McKinsey Champions Diversity While Rivals Abandon Targets

  SoftBank Posts Quarterly Loss, Gears Up for Giant AI Project

  How Trump’s Policies Have Shaken America’s IT Departments

  Nvidia Shares No Longer Bulletproof as DeepSeek Fears Linger

  Alibaba Becomes China’s New AI Darling With $87 Billion Rally

  Meta’s Accounting Move on AI Servers to Boost Profit This Year

  China’s Vast Energy Market Swallows DeepSeek Impact

  Tesla Can’t Afford Another Twitter-Size Distraction

  Ford Chief Executive Says Trump Policies May Lead to Layoffs

  Biogen Forecasts Bigger Annual Sales Decline Than Expected

  CVS Rises After Fourth-Quarter Profit Signals Improvement

  How Oura’s Smart Ring Bridged the Gap From Tech Bros to Normies

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• CWS Market Review – February 11, 2025
  Eddy Elfenbein, February 11th, 2025 at 6:38 pm

  (This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

  After a very good 2024, the stock market seems to have settled into its comfort zone. For the S&P 500, that’s apparently anywhere between 6,025 and 6,085. The index has closed inside that narrow range ten times in the last eleven trading sessions.

  On Thursday, the S&P 500 closed higher by one-thirtieth of 1%. That means for every $30 you have in the market, you made one penny today.

  That’s so small that if the index closed higher by that much every day for an entire year, the total gain would be a little less than 9%. In fact, today’s gain almost perfectly matches the market’s average gain for a single day.

  

  This is a big change from last year when the index steadily marched higher without much pushback.

  We’re also not seeing any major undercurrents within the market. Neither value nor growth are leading the way. Large-cap tech has had some good days recently and some lousy ones, but there’s no larger trend at work except the absence of one.

  We’re heading toward the back end of earnings season, and so far, this has been a very good earnings season for Wall Street. According to numbers from S&P Global Market Intelligence, the S&P 500 is on pace for Q4 earnings growth of 13.89%. That’s up from 8.71% one month ago.

  Of the companies that have reported so far, 76.6% have beaten on earnings and 61.4% have beaten on sales.

  So where does this put the Federal Reserve? Traditionally, the Fed has had its fingerprints near the scene of any bear market, but this time could be different.

  “We Do Not Need to Be in a Hurry”

  “We do not need to be in a hurry.” So said Fed Chair Jerome Powell as he testified before Congress today. In this instance, I think the Fed Chair is exactly right.

  

  The Fed doesn’t need to act swiftly right now since the Fed has already cut rates a few times. That’s taken some of the pressure off the central bank. We also don’t know what the outcome of President Trump’s tariff policies will be, or even how long they’ll last.

  Twice a year, the Fed Chairman testifies before members of Congress. I should caution you that watching members of Congress attempt monetary policy is not for the faint of heart. The boring stuff happens in the House or Senate chambers, but the real action is in the committees.

  A few years ago, I went to the Senate office building to watch the festivities. I got there early and was able to snag the seat directly before Alan Greenspan. If you like endless jargon, then the Fed testimony is for you.

  At its last meeting, at the end of January, the Federal Reserve decided to leave interest rates alone. The current range for the Fed funds rate is 4.25% to 4.5%. Before the January meeting, the Fed had lowered interest rates at three successive meetings. The first cut was by 0.5% and the other two were by 0.25%.

  So far, there hasn’t been any disharmony between the White House and the Fed. President Trump even said he agreed with the Fed holding rates steady at its last meeting, but that goodwill may not last. Last Friday’s jobs report could lead to calls for more rate cuts.

  The Economy Created 143,000 New Jobs Last Month

  On Friday, the government said that the U.S. economy added 143,000 net new jobs last month. That’s an OK figure, but it’s nothing great. It was below Wall Street’s estimates of 169,000 jobs, and it was also below December’s revised gain of 307,000.

  The best news in the report is that average hourly earnings rose by 0.5%. That’s a very nice gain and it’s more than inflation. In previous reports, wages have been rising but only slightly more than inflation. Over the last year, average hourly earnings are up 4.1%.

  

  On a technical note, the Bureau of Labor Statistics did its annual revisions, and that reduced its jobs count for last year. In plain English, they overcounted the number of jobs. We already knew they overcounted, but we didn’t know by how much. It turns out that it was by 589,000 jobs.

  Oopsie!

  On the plus side, the jobs numbers for November and December were revised higher. The unemployment rate fell to 4.0%. Except for January 1970, the unemployment rate is lower now than it was during the entire 1970s, 80s and 90s.

  Job growth for January was concentrated in health care (44,000), retail (34,000) and government (32,000). The total gain for the month was slightly off the average 166,000 in 2024, the BLS said. Social assistance added 22,000, while mining-related industries lost 8,000.

  Also, more people are looking for work. The labor force participation rate increased by 0.1% to 62.6%. The broader U-6 jobless rate held steady at 7.5%. There’s really nothing in this report to convince the Fed that it needs to get back to lowering rates, but that could change.

  The Fed meets again in another month and it’s very doubtful that they’ll change rates. In fact, the Fed may not make any rate changes for a few months. Currently, traders think there’s a 59% chance of a rate cut by the end of July.

  The next big news will come tomorrow when the Fed releases the CPI report for December. This could be a very influential report. The backstory is that inflation came down quickly from its high, but it’s had a hard time falling much below 3% or so. The Fed’s official policy is to get inflation back to 2%.

  I’m really starting to question the efficacy of a 2% inflation target. What makes 2% inflation vastly better than 3%? I don’t know the answer.

  For tomorrow, Wall Street expects the core and headline rates to have increased by 0.3% last month. That would place the 2024 headline rate at 2.8%, and the full-year core rate at 3.2%. The year-over-year rates have been moving higher in recent months, which must be frustrating for the Fed.

  That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

  – Eddy

• Morning News: February 11, 2025
  Eddy Elfenbein, February 11th, 2025 at 7:02 am

  Spooked Arab World Scrambles for Response to Trump’s Gaza Plan

  Russia’s Sakhalin Island Oil Is Backing Up After US Sanctions

  Why Europe’s Gas Storage Has Become More of a Worry

  BP Touts ‘New Beginning,’ Fundamental Change in Strategy

  How Trump’s Canadian Oil Tariff Would Hit America’s Heartland

  The Black Market for Oil Will Continue to Thrive

  EU Pledges Countermeasures Against Trump’s Tariffs on Metals

  Is It Made of Metal? It Could Get More Expensive Under Trump’s Latest Tariffs.

  Confusion Reigns as ‘a Wrecking Ball’ Hits the Consumer Bureau

  Who Will Protect the Fed’s Independence? The Markets

  Markets Hedge That This Time, Trump Means It

  JPMorgan Defector Aims to Make Wells Fargo a Wall Street Force

  Goldman Sachs’ Exclusive Investing Club Is a Powerful Draw

  Hedge Funds Are Pocketing Much of Their Clients’ Gains With ‘No Limit’ Fees

  Carlyle’s Schwartz Met 2024 Goals. What He Does Next Will Define Him.

  Accounting Firms Hire Growth Leaders as Dealmaking Shakes Up Industry

  Seeking God, or Peter Thiel, in Silicon Valley

  Altman Says OpenAI Is ‘Not for Sale’ After Musk’s Offer

  What’s Behind Elon Musk’s Hostile Bid for Control of OpenAI

  Google, SoftBank Back Quantum Startup QuEra in $230 Million Deal

  Super Micro’s Roller Coaster Continues Into Earnings with 59% Stock Pop in Past Week

  Spotify Founders Pocket $1 Billion Selling Booming Tech Stock

  Marriott Profit Beats Estimates in Record Year for Adding Rooms

  How Loaded Fries and Large Sodas Helped One Restaurant Chain Beat Inflation Blues

  Why Fast Food Could Be MAHA’s Next Target

  Coca-Cola’s Higher Prices and Volume Drive Earnings Beat

  Who Needs Hollywood? Chinese Animated Film Shatters Box Office Records.

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• Morning News: February 10, 2025
  Eddy Elfenbein, February 10th, 2025 at 7:03 am

  New Zealand Locks Out Foreign Home Buyers Even as Golden Visa Rules Eased

  Don’t Blink Now, Trump. Russia’s Economy Is Cracking

  Front-Loading Tariffs Undercuts Trump’s Promise of Faster Growth

  Weaponizing Canadian Oil Would Rattle Trump

  Trump Plans to Impose 25% Tariffs on Steel, Aluminum Imports

  Trump’s Man of Steel Posturing Makes America Weaker

  Trump’s Renewables Permit Flip-Flop Unsettles Sector

  Why Fentanyl Is at the Center of New US-China Trade Fight

  Shein Asks Some Chinese Suppliers to Diversify to Vietnam

  Trump’s Tariffs Make Currency Trading Cool Again After Years of Decline

  Trump’s Tariff Threats Extend Safe-Haven Gold’s Record Rally

  The S&P 500 Is Too Big to Falter on Trump’s Tariffs

  Trump Fanned Inflation Fears. Now They Haunt His Presidency.

  36 Hours After Russell Vought Took Over Consumer Bureau, He Shut Its Operations

  DOGE-Backed Halt at CFPB Comes Amid Musk’s Plans for ‘X’ Digital Wallet

  The Musk Deputy Running DOGE’s Huge Cost-Cutting Drive

  Tech Firms Want to Upend the Pentagon. The Old Defense Guard Has Some Lessons for Them.

  For CEOs and Bankers, the Trump Euphoria Is Fading Fast

  Trump Tells U.S. Treasury to Stop Minting Pennies

  TD Bank Hopes to Raise $14 Billion in Schwab Stake Exit

  Alarmed, Employers Ask: What Is ‘Illegal D.E.I.’?

  What DeepSeek’s Success Says About China’s Ability to Nurture Talent

  McDonald’s Sales Improve on Stronger International Results

  Coke’s $7 Billion Bet on Milk Hits Big, But Wall Street Wants More

  Hyatt to Buy All-Inclusive Resort Owner Playa for $2.6 Billion

  Who’s Watching What on TV? Who’s to Say?

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• Morning News: February 7, 2025
  Eddy Elfenbein, February 7th, 2025 at 7:02 am

  India Central Bank Kicks Off Easing Cycle to Boost Economy

  Europe Is Looking to Roll Back Climate Accounting Rules

  ECB Updates Estimate of Neutral Rate as Policy Makers Question Its Usefulness

  Broken Markets Hold Back Europe as Trump Amps Up the Pressure

  Trump Trade Nominee Defends Plan to Reorder International Trade

  What Closing the De Minimis Tariff Loophole for US Imports from China Means

  The Real Danger of Trump’s Incoherent Trade Policy

  The Early Verdict on Tariffs: Bad Economics, Better Politics

  Bessent Projects Normalcy While ‘Completely Aligned’ With Musk

  Trump’s Executive Orders Leave Imprint on the Fed

  Solid Labor Market Gives Fed Cover to Extend Rate Pause

  Crypto’s First Family Is Deepening the Swamp

  Tether Revs Up Deal Machine After Its Embrace by ‘Establishment’

  The Perpetual Hunt for ‘Alpha’

  Fannie Mae Underpins the Mortgage Market. Should the Government Sell It?

  Senate Confirms Russell Vought as Office of Management and Budget Director

  Bond Traders Await Payrolls Print That May Vindicate Fed Caution

  After LA Fires Destroyed Mansions, Banks Reckon With Jumbo Loans

  Business Schools Confront Trump Immigration Policies

  GM, Pepsi, Disney, Others Scrub Some DEI References from Investor Reports

  Bain Capital to Buy Mitsubishi Chemical’s Pharma Business for More Than $3 Billion

  Legal & General to Sell U.S. Insurance Businesses in $2.3 Billion Deal

  Amazon, Like Microsoft, Says It Can’t Keep Up With AI Demand

  Venture Global IPO Shows Limits of Trump Bump

  Porsche Shares Slide After Profit Warning for 2025

  New Orleans Needs an Economic Win. It’s Betting on the Super Bowl.

  The Reason Why This Super Bowl Has So Many Conspiracy Theories

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• Morning News: February 6, 2025
  Eddy Elfenbein, February 6th, 2025 at 7:03 am

  Silicon Valley Leans Into ‘Lethal’ Tech While Europe Waits on a Defense Plan

  Trump Flashes Newfound Imperialist Streak in White House Return

  Trump Should Learn From Helsinki, Not Yalta, on Foreign Policy

  Bessent Explains Trump. It Won’t Be the Last Time

  Hawkish BOJ Board Member Calls for Potentially Faster Rate Hikes

  Bank of England Cuts Interest Rates as British Economy Weakens

  Northern Ireland Worries About Fallout From Transatlantic Trade War

  King Dollar Won’t Follow Trump’s Tariff Playbook

  Data Hoarders Are Rushing to Save Vanishing US Health Records

  Friday’s Jobs Report Will Be Confusing. Here’s How to Make Sense of It.

  US Jobs Will Get Marked Down, But Not as Much as Once Feared

  US Banks Raise Equity to Jumpstart Deals, Bolster Balance Sheets

  Societe Generale Shares Jump After Results Beat Expectations

  SocGen Says It Won’t Follow Wall Street Out of Climate Alliance

  Pimco Is Falling Behind as Private Credit Booms

  Exiled From Goldman Sachs, a Fallen Star Finds His Next Act

  Could the Trade Fight Take a Bite Out of Apple?

  Conoco Quarterly Net Income Fell, Expects 2025 Production Growth

  TotalEnergies Hails Power Profit as Rivals Pull Back on Renewables

  Can Nissan Survive Without Honda’s Helping Hand?

  Honeywell to Break Up After Pressure From Activist Elliott

  Peloton Posts Profit Beat and Raises Guidance, Shares Surge

  The Heist of 100,000 Eggs in Pennsylvania Becomes a Whodunit that Police Have Yet to Crack

  Orange Juice Makers Are Desperate for a Comeback

  Philip Morris Beats Estimates as Demand for Zyn Pouches Surges

  $62,000 for the Super Bowl. $1 Million for Formula 1. How Much Would You Pay for a Sporting Event?

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