Big Business This Week

Markets Shrug as Iran War Resumes

Cheddar's Big Business This Week — Thu, 09 Jul 2026 21:19:58 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

The bombs are back! With Donald Trump and the Iranian Mullahs tearing up their fragile, short-lived Memorandum of (mis)Understanding and resuming their highly combustible game of tit-for-tat, you might expect global markets to be in full-blown panic. After all, the U.S. military just launched fresh strikes on Iran to keep the Strait of Hormuz open, hitting some 90 military targets, which promptly triggered Iranian retaliatory strikes on U.S. bases in Kuwait, Bahrain, and Qatar. Trump declared on Wednesday that the ceasefire is officially "over," while calling Iranian leaders "liars" and "sick people.”

Yet, if you look at the actual financial charts, Wall Street and global investors are responding with little more than a collective, synchronized shrug. Instead of sky-rocketing through the stratosphere, crude oil prices are bobbing up and down a little bit. In the span of just five days, oil prices bounced from $68 to $75 and slid right back down to $71. Yes, that is higher than the $60 baseline before the bombing started, and drivers are feeling the pinch with gasoline averaging $3.85 a gallon (up from $3.16 a year ago). But overall, the market's reaction suggests that the financial world has developed a thick skin.

(Google)

So, who is actually making money in this chaotic "new normal?”

While traders, refiners, and oil majors are doing just fine, the real surprise is the resilience of consumer-facing big businesses. Delta Air Lines, $DAL ( ▲ 2.21% ) which reports its highly anticipated earnings this Friday, is up an astonishing 25% year-to-date, nearly tripling the return of the S&P 500. Even with jet fuel prices remaining stubbornly high, about a third higher than pre-war levels, airlines are making a killing thanks to warm weather and relentless consumer demand. Consumers, it seems, would rather fly through a geopolitical storm than cancel their vacation plans.

Over in Singapore, institutional heavyweights are urging everyone to take a deep breath. Rohit Sipahimalani, Chief Investment Officer of the state-owned investor Temasek, noted at the Reuters NEXT conference: "There are always tail risks and it's likely that the path to resolution will not be a straight line." But from a market perspective, he insisted, "the worst is behind us, peak uncertainty is behind us, and outside some really 'tail' outcomes... this is not going to be a key driver of the market."

Rather than fleeing for safety, savvy long-term investors are treating the volatility like a boutique clearance sale. Clara Chan, CEO of the Hong Kong Investment Corporation (HKIC), explained that "the fact that there is some market volatility, there will be some change in valuation and for a long-term investor like us with staying power, those could be (the) perfect window to buy." HKIC also remains laser-focused on sustainable investments.

Indeed, what some investors have called the "largest energy shock in history" is fast-tracking the global green transition. Thailand, which usually imports energy to the tune of 8% of its GDP, is turning this crisis into a major economic catalyst. Vice Finance Minister Santitarn Sathirathai remarked at the summit that the war is actually driving a "new growth engine" centered on green industries, noting: "A lot of the green economy, whether it's new energy vehicles, solar panels and related industries, those are areas where Thailand already has some capabilities and we can build a lot more upon that."

Geopolitics may be as explosive as ever, but big business, oil markets, and global capital appear to have learned to shrug off the fire.

—Peter S. Green

Big Businesses mentioned this week

$DAL ( ▲ 2.21% ) $SPCX ( ▲ 2.6% ) $MU ( ▲ 4.52% ) $AMD ( ▲ 5.67% ) $INTC ( ▲ 2.09% ) $NVDA ( ▼ 0.66% ) $SOXX ( ▲ 3.5% ) $SOXQ ( ▲ 3.05% ) $DRAM ( ▲ 3.74% ) $SJM ( ▼ 1.29% ) $META ( ▲ 4.7% ) $AMZN ( ▲ 1.4% ) $ANTHZZX ( ▲ 0.37% ) $MSFT ( ▲ 0.27% ) $TM ( ▼ 1.6% ) $GM ( ▲ 0.54% ) $RIVN ( ▲ 8.76% ) $TSLA ( ▲ 3.17% )

The Usual Suspects

The Chip Dip: It looks like chip stocks are falling off the old auction block. Amid investor fears that AI firms can’t keep buying more chips until they have some revenue to show for all their spending, and hedge funds and other early investors deciding to sell to lock in their gains (what Wall Street likes to call profit-taking), it’s been a bad few weeks for the companies making processing and memory chips. The big disappointment is Samsung, which reported a second-quarter operating profit of about $58 billion, nearly 20x its profit a year earlier, but its shares fell 7% after the announcement, as investors expected even greater growth to come. On Monday, another Korean chipmaker, SK Hynix, opened a U.S. share sale aiming to raise $28 billion, the second-largest new share sale on record after SpaceX’s $SPCX ( ▲ 2.6% ) $86 billion June IPO. Micron $MU ( ▲ 4.52% ) dropped 12% in the past five days, while AMD $AMD ( ▲ 5.67% ) dropped 6%. Intel $INTC ( ▲ 2.09% ) dropped 9% on Tuesday alone. Nvidia $NVDA ( ▼ 0.66% ) , the poster child for the chip boom, is actually up more than 4% in the past five days, but it’s down more than 2% in the past month. The sector ETFs give a hint of how widespread the trouble is. $SOXX ( ▲ 3.5% ) , the iShares Semiconductor ETF is down 14% since a peak on June 22, and the PHLX Semiconductor Sector $SOXQ ( ▲ 3.05% ) is down 8.3% in the past five days. Memory chips took it particularly hard. The Roundhill Memory ETF $DRAM ( ▲ 3.74% ) , is down 8% in the past five days. Then again, in the looking-glass world of the U.S. stock markets, where few companies are valued as ongoing businesses, the winds could change tomorrow. Indeed, by the time we went to press, many of these stocks had recovered many of their earlier losses. “Expectations have gotten to ⁠be almost impossible to beat for these companies,” Zachary Hill, head of portfolio management at Horizon Investments told the Globe & Mail.

(Google)

SpaceX Splashdown: Adding Elon’s Spaceship/AI/Satellite/Mobile phone company to the Nasdaq-100 index was supposed to buoy both SpaceX’s $SPCX ( ▲ 2.6% ) newly public shares, and the Nasdaq’s quest for ever greater heights. After pricing the IPO at $135, shares opened for trading at $150. They’ve now fallen below that, closing Wednesday at $148.30, a 35% drop from their mid-June intraday peak of $225. So what happened to the expected Nasdaq boost? Well, the index has about $40 trillion worth of stock, and despite the large size of SpaceX’s $68 billion IPO, the total number of tradeable shares is only worth about $100 billion, and the Nasdaq chiefs gave that a triple weight, so its total oomph is about 0.75% of the index. The math is fun: With $600 billion in assets indexed to the Nasdaq, that’s only about $4.5 billion of SpaceX stock that index funds need to buy. Not much of a boost there, either.
Private Equity and the Boston Celtics: Winning isn’t everything, profits are. Legendary Packers’ coach Vince Lombardi would have been shocked, shocked. The fiercely competitive Lombardi liked to tell his team that “Winning isn’t everything, it’s the only thing.” But that’s not how the private equity owners of the Boston Celtics, one of the most storied, and winningest, teams in pro basketball, see it. Last week they announced they were trading away cornerstone player Jaylen Brown, the 29-year-old guard and forward, after 10 years with the team, for an aging 34-year old and some draft picks. The sports world consensus is that without Brown, the Celtics have less chance of repeating their 2024 NBA championship win. So why trade him? Salary. Brown was the NBA’s highest-paid player in 2023, and he is still owed more than $180 million over the next three seasons. That may make up 35% of the Celtics salary cap, but it seems the bigger lesson is that paying Brown that kind of money extends the payback timeline for the private equity limited partners who financed owner Bill Chisholm’s $6 billion purchase of the team after the 2024 championship.
Twinkie’s multi-billion-dollar turmoil: It turns out that Hostess Twinkies will not survive nuclear armageddon, or even a rocket journey to Mars. And the actual shelf life of a Twinkie, about 65 days, has cost its new owner several billion dollars. J.M. Smucker $SJM ( ▼ 1.29% ), the jam and dog food maker that bought Twinkie parent Hostess for $5 billion in 2024, found that Hostess’s products don't fit neatly into Smucker’s own distribution network, where products, including jams, coffee and dog food, last on shelves for a year or more. Puzzling that through and tossing out the alleged synergies of the purchase have cost Smucker’s three impairment charges, totaling almost $3 billion, the Wall Street Journal reports, and forced it to hand two board seats to activist investor Elliott Investment Management. Shares in Smucker's have fallen about 14% since the purchase.

Keebeck Wealth Management: A modern advisory firm built for founders and families.

We offer a thoughtful, relationship-driven approach designed to bring clarity and confidence to complex financial decisions. Our team focuses on understanding each client’s goals, creating comprehensive plans, and providing transparent guidance every step of the way.

At Keebeck, we believe effective advice comes from alignment, communication, and disciplined thinking. We use technology and a collaborative process to help clients stay informed and prepared as their needs evolve.

Our mission is simple: to empower you with the insight and structure needed to navigate your financial future with purpose.

Keebeck Wealth Management — Helping you become the CEO of your capital.

* Information provided is general in nature and does not constitute personalized investment advice. A professional adviser should be consulted before implementing any of the options presented. Any tax and estate planning information provided is general in nature and should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation. The use of generative AI (artificial intelligence) will allow users to ask general questions, not provided by a human. This service will rely on third-party sources of data and information. We cannot guarantee the accuracy of such information, and the user should take steps to verify information provided herein. Information provided on or through this service is not an offer to buy or sell, or a solicitation of any offer to buy or sell the securities mentioned herein. Hyperlinks on this website are provided as a convenience and we disclaim any responsibility for information, services or products found on pages linked hereto. Our annual fee for portfolio management services is equal a percentage of the market value of your assets under our management. You will be charged, separate from and in addition to your management fee, any applicable Platform Fees as well as applicable independent manager fees. We do not receive any portion of the fees paid directly to third party service providers, including the independent managers.

END OF ADVERTISEMENT

Tech Talk

Here’s looking at you, Zuck. Meta $META ( ▲ 4.7% ) is introducing new AI glasses that would continuously record everything you hear and see, feed it back to Meta’s servers, and use the data to train Meta’s laggard AI LLMs. As Zuck recently told investors, the glasses aim to be your “personal agent.” According to the Financial Times, many of the same features can already be accessed with a software upgrade to Meta’s existing Ray-Bans. But the new glasses are likely to face challenges from government and civil liberties groups that see them more as secret agents than personal agents. Last month, Wired magazine found code for a facial recognition system embedded in Meta’s smart glasses platform. The company then removed the system. It says.

Speaking of surveillance: Ali Baba, the Amazon $AMZN ( ▲ 1.4% ) of China, is one of several Chinese AI firms that U.S. tech companies have accused of pirating U.S. AI systems. In a letter to Senators Tim Scott and Elizabeth Warren, Anthropic $ANTHZZX ( ▲ 0.37% ) charged that Chinese firms are creating hundreds of accounts on Anthropic, then using those accounts to crib Anthropic’s tech and replicate it. “These distillation attacks are carried out illicitly, systematically and at industrial scale to harvest U.S. A.I. capabilities across frontier labs and repackage them as their own,” Anthropic told the two senators, referring to companies on the frontier of A.I. development. Distilling has been a problem for U.S. AI companies for several years, and it’s beginning to cost them their edge. OpenAI said China’s DeepSeek was built by distilling OpenAI, and xAI $SPCX ( ▲ 2.6% ) founder Elon Musk conceded in court that his firm had “partly” distilled OpenAI work as well. But it’s not clear yet if courts would find distilling illegal,
Ali Baba may be regretting that decision, but not for legal reasons: Reporting only $1.4 billion in AI revenue in the first quarter, alongside a planned $55 billion Ai hardware buildout through 2027, the Chinese firm is struggling to generate profits from AI.
Ex-Box? XBOX, the video game platform that brings in about 6% of Microsoft’s $MSFT ( ▲ 0.27% ) revenue, is about to have a lot fewer employees and a lot more ex-employees. Some 2,850 Xbox workers will be laid off by the end of 2027, part of 4,800 firings at the tech giant, as it refocuses on AI. It’s not really clear how AI will fill the closed roles, but XBOX CEO Asha Sharma told employees that its teams were 40% larger than they were a generation ago, but “the player base and playtime have declined.” Sharma also plans to shutter or sell off some of the game design studios it acquired. No word yet on the $69 billion purchase of Activision Blizzard, the maker of Candy Crush and Line of Duty (you do understand the connection there, right?). But it’s lost 64 cents for every dollar its invested in the studios. Microsoft CEO Satya Nadella explained the challenge: “We have to turn this into a sustainable business,” he said on a tech podcast.

Car Talk

Toyota's border hop: Japanese carmaker Toyota $TM ( ▼ 1.6% ) , says it will move the Mexican plant that makes its mid-size Tacoma pickup to the U.S border town of San Antonio, Texas. Toyota expects to spend $3.6 billion on the move, creating 2,000 new jobs and boosting production from 200,000 pickups a year to 350,000 by 2030. Toyota said it will continue to make cars at the Mexico plant near Tijuana. The move to Texas comes six years after Toyota announced it was moving Tacoma production to Mexico. Toyota is close to outselling General Motors $GM ( ▲ 0.54% ) to become the biggest car brand in the U.S. Sales rose 0.5% through the end of June from a year earlier, to 1.24 million vehicles, as GM reported a 6.8% sales drop, to 1.34 million. Toyota has been investing in hybrids, while GM’s turn to EVs has faltered.

Rivian shares rattled by stock sale: Rivian $RIVN ( ▲ 8.76% ) , the U.S. EV maker that’must have thought it was on to a good thing when it aimed to raise about $1.5 billion with a share sale on Monday, following a 19% jump in its share price last week, and an 8.1% zoom on Monday. But after the share sale was announced, Rivian’s stock price fell 18%. Oops. Rivian has been struggling to compete with Tesla $TSLA ( ▲ 3.17% ) , and the one place it’s matched its rival is by also never turning a profit. Since its debut in 2021 at $130 a share, Rivian has lost 87% of its value, closing Wednesday at $16.66, costing shareholders about $85 billion. Still, things have been good for CEO Robert Scaringe, who made $402.6 million last year, or 4,458 times the company’s median employee pay.

Trumplandia

Are we measuring inflation the right way? Probably not. With headline inflation numbers taking the economy ever further from the Fed’s 2%-ish target, thus pushing off, seemingly forever, the prospect of a rate cut. But maybe we don't really know what we’re talking about. That’s the gist of several conversations among economists and econometricians right now. And it carries big implications for the Trump Economy, the war on Iran, the Holy Grail of a rate cut, and the November mid-term elections. Here’s a short version, which BBTW will return to when we finish reading the stacks of academic papers and untangling the blue lines and the red lines (and the pink lines and yellow lines) on several hundred pages of charts. But the gist is that using inflation to measure the health of the economy is a fraught notion. Simply gauging the effect of real-world activity on a consumer’s bank account means different things at different times. So energy prices shoot up for a few months, then collapse back down. Is that real inflation, or just momentary turbulence? Does a spike in the price of one item matter? Sure, beef has gone from $4 a pound to nearly $7 since 2020, but it represents about 0.64% of the average U.S. consumer's budget, so it may seem expensive, but it’s hardly moving the needle. Gasoline is 3% to 4%, so that hurts more. Housing is 30-35% of the average household budget, so that’s where the pain really comes in. So, with oil prices bumping around right now, what does that mean for real inflation? As a first step, the Bureau of Economic Analysis, part of the Commerce Dept., is reworking how it tabulates inflation, and should start using the new method next year (and backdating its data to 2021 for comparison). But the long and the short of it is that for now, inflation remains high, whether things like energy, steak or medical costs are driving it up, and a look at the most recently released minutes of the Fed’s Open Market Committee, the first chaired by Kevin Warsh, shows the chances of a rate cut are essentially zero for the rest of this year.
(Google)

Want more Cheddar?

You’re clearly into smart people talking about even smarter things. Lucky for you, that's literally our whole deal at Cheddar. We interview the brightest minds in business, finance, and tech. If you'd like more in-depth analysis from interesting people, lcheck out our where to watch page and turn us on 24/7! Your wallet will thank you and so, more importantly, will your mind. But also your wallet. Remember that.

Peter S. Green is a veteran reporter and editor who has spent more than two decades covering business and finance from Eastern Europe to New York City, and has worked for Bloomberg News, The New York Post, The New York Times and The Messenger. He lives in New York City and is always looking for the next big story. Email him here.

Ask A Nobel Prize Winner: Can AI Save the American Dream?

Cheddar's Big Business This Week — Thu, 02 Jul 2026 20:30:00 +0000

Simon Johnson, the MIT economist and Nobel laureate, has spent much of his career studying how institutions shape prosperity — and how societies lose it when those institutions fail. At a moment when AI investment is booming, tariffs are back at the center of U.S. economic policy, investor protections are being rolled back, and many Americans feel locked out of the economy’s gains, Johnson sees both danger and possibility. Big Business This Week columnist Peter Green spoke with him to discuss what the future of the U.S. economy looks like. He says it is being held up in part by the AI boom, but whether that boom leads to broader prosperity or a deeper ‘K-shaped economy’ depends on choices that are still being made.

Are we at an inflection point for the global economy and the postwar model of growth?

I think there's pressure, obviously, on the system globally, including the role of trade, and there's also pressure on institutions, including in the U.S., so I think we’re facing a big stress test for institutions. At the same time, we're having a boom around investment in AI, which is keeping the U.S. economy going, and which is also raising questions about what's the future of jobs, with people increasingly concerned about their job and their children's prospects. So it's a moment of considerable uncertainty, but there is upside potential.

I don't want to sound too negative but I think there's some very positive things that can happen. At MIT, we have a research group focused on what we call pro-worker AI, asking; Can we get developments of AI that would actually raise wages and share prosperity better? Because that could actually help deal with the polarization of the job market that's been with us for decades now, and that is part of the angst and the anger that many people feel, even in rich countries.

People now talk about a K-shaped economy, where the top keeps pulling away while the middle and bottom fall behind. Is shared prosperity at risk?

It's been in jeopardy for some time. Within labor, highly skilled, highly educated people have done much better over the past four decades than people without much education, and the middle has become squeezed by various forces pretty consistently over those decades. The K-shaped economy is not new. The worry now is that AI and related developments may further intensify it. But there are choices to make, including policy choices, that could put us on a different path.

What would put us on a different path?

The main thing is that the way technology develops needs to increase the demand for human expertise rather than de-skilling jobs. If you get mostly automation, meaning you replace people with machines, then there will be downward pressure on wages, and then CEOs will do extremely well. If you have upward pressure on wages because there's a bigger demand for human expertise to build things and to create new things, and that could be AI-powered or empowered, then workers will do much better. I mean, CEOs may also do well, by the way, in that scenario. I think, though, you're quite right that right now it's the divergence of fortunes that grabs your attention and that is very salient. So if the workers can do better and real wages can rise across the board, including for people who didn't go to college and finish college, that would be a big change.

We are also seeing political expressions of frustration, from Trump voters in 2016 to younger voters in the Blue-state cities like New York angry about debt, housing, and affordability. How do you read that?

Certainly political expression of frustration is increasing. But don't you think that Donald Trump's election in 2016 was also an expression, maybe not by exactly the same demographic? A lot of people feel like they've been left behind. And I agree with your assessment of what's happened in New York, and I think the frustration levels there are very high, but they're shared across quite a few other groups. It's the frustration of the K-shape and feeling that prosperity is not being shared. That's the key frustration. And that's common across multiple groups.

So what else needs to change? It can’t just be AI making jobs better.

Technology. You can change the degree of redistribution, you can support people at different parts of their life cycle and so on. You can change the tax system, reduce the tax on labor, for example, relative to machines. There are other policies and potential levers available, but the technology piece is driving it, and you mustn’t neglect that.

What happens when institutions meant to protect investors and consumers are weakened?

What's happening at the SEC is worrying. The protection of investors is important, and to the extent that's being weakened, that's a problem. Consumer protection for financial services, like the Consumer Financial Protection Bureau being gutted is also a big problem. Those sort of core investor and consumer protections are very important for shared prosperity and productivity growth. But, you know, allowing people to understand and need to be reminded that the stock market involves a high degree of risk, and allowing people to participate in that is not by itself a bad thing if they understand the risks, if they can afford losses, and so on. If they are duped into thinking it's easy money or one-way bets, that's a problem. I don't think you want to be too draconian in excluding people from trying to make money or trying to benefit from the volatility, but you do need robust investor protection. That is absolutely for sure. Without that, many bad things can happen.

And without those institutions, prosperity gets shared among ever-fewer people, I suppose?

Yes, absolutely. Investor protections, requiring transparency, that is the core of the SEC mission. Integrity of markets, that's a Commodity Futures Trading Commission mission. Making sure consumers are not taken advantage of in basic financial services like banking, that's the CFPB. We've never said that you shouldn't be allowed to gamble or you shouldn't be allowed to go to Las Vegas, if that's what you want to do. Of course there are issues of addiction and irresponsibility and so on, but those need to be confronted at an individual level. You want risk-taking, you want entrepreneurs, you want them to be able to raise capital, and you want people to be able to invest in new ventures, “little tech,” as one of my friends called it, the up-and-coming next technologies. That's just a real strength of the American economy.

What happens if the U.S. doesn’t restore a sense of shared prosperity?

If there's a breakdown in investor protections, I think you could have a lot of trouble in the stock market and more broadly. And that would be undermining productivity growth and overall prosperity. The shared prosperity is separate but related: If we don't re-establish that there's a rising tide that lifts all boats, then you would expect—and we have seen it in other countries—broader political backlash, a lot of populism of a not very constructive variety. And that can undermine your overall growth. It's not a new situation, [but] it is becoming more precarious. And what happens with AI, I think, is going to potentially tip the balance one way or another.

You said AI will be a transformative force, but investors and analysts are questioning whether there is a business case for the trillions going into AI.

It's like railways in the 19th century. There was clearly a business case for building railways. They transformed the country. They helped improve many people's lives, not everybody, but many people. But there were periods of overinvestment and periods when the valuations of those stocks were exuberant, overly exuberant. So that is a bit of an American feature. We like to invest. We like to build new things, and we do tend to get carried away. So where are we in that cycle? It's hard to say. The technology, AI, will end up changing the world, but is profit going to accrue? That's the nature of risk, you see. And what you want is people, investors willing to understand risk and willing to undertake investments given that risk. And if they manage their portfolios in the right way, they will benefit over time. But there could be losses along the way, and people need to understand that.

(This interview has been edited and condensed for clarity.)

—Peter S. Green

Big Businesses mentioned this week

$AAL ( ▲ 3.27% ) $BA ( ▼ 0.82% ) $CALM ( ▲ 0.32% ) $CHTR ( ▲ 0.61% ) $CMCSA ( ▲ 0.67% ) $COXCF ( 0.0% ) $CRWV ( ▼ 0.33% ) $DAL ( ▲ 2.21% ) $DJI ( ▼ 1.26% ) $DLAKY ( ▲ 0.94% ) $DYNA ( ▲ 3.01% ) $EADSY ( ▼ 0.27% ) $FOXA ( ▲ 0.66% ) $GOOG ( ▼ 0.69% ) $JBS ( ▼ 0.76% ) $JPM ( ▲ 1.47% ) $META ( ▲ 4.7% ) $MSFT ( ▲ 0.27% ) $NASDAQ ( 0.0% ) $NBIS ( ▼ 0.13% ) $OPEAZZX ( ▼ 0.28% ) $PSKY ( ▼ 4.31% ) $SPCX ( ▲ 2.6% ) $TSN ( ▼ 1.01% ) $UAL ( ▲ 2.24% ) $WBD ( ▲ 1.84% ) $WLFI ( ▲ 0.52% )

This week, big business!

War Story
The Usual Suspects
Tech Talk
The Short Stack

War Story

Strait outta Hormuz: The Saudis are filling up tankers, some ships are passing through Hormuz, Oman says it wants to join Iran in charging ships to pass through the international waterway (that’s against the Law of the Sea, which is backed by a bunch of international treaties that both have signed), and most importantly, the price of oil is down, with Brent crude trading at about $71.50 a barrel, about where it was before the bombing began on Feb. 28. But gasoline is still hovering around $3 a gallon, up a third from before the war, and prices are likely to climb again as countries rebuild their strategic reserves. More price pressure could come this winter, as Gulf states struggle to rebuild their war-wrecked oil and gas infrastructure, but that doesn’t mean more new oilfields will start pumping. “People are not going to start drilling in the U.S. because oil goes above $80 for a few weeks,” said Andrejka Bernatova, said Andrejka Bernatova, Chairman and CEO of $DNMX Dynamix Corporation III, an energy investing platform.. “It’s going to take a sustained price at $80 or above for new production to take place.”

One Shark Missed Billions… Another Saw This Coming

Imagine turning down Uber at a valuation of $10 million, only to watch it go public at over $80 billion.

That’s exactly what happened to Mark Cuban… a 799,900% return, gone.

But original Shark Tank investor Kevin Harrington built his career doing the opposite: spotting asymmetric opportunities before they go mainstream.

Like Uber turned vehicles into income-generating assets, Mode Mobile is turning smartphones into income streams.

They were named the #1 fastest-growing software company by Deloitte and have already helped their users earn and save over $1B.

Kevin Harrington invested early.

And at just $0.52/share, you can still get in before their potential IPO.

Secure shares at $0.52 while the pre-IPO window is still open.

^{Potential Uber return for Marc Cuban does not take into account dilution.}

^{The Deloitte rankings are based on submitted applications and public company database research, with winners selected based on their fiscal-year revenue growth percentage over a three-year period in 2023.}

^{Please read the offering circular at}^{invest.modemobile.com}^{. This is a paid advertisement for Mode Mobile’s Regulation A Offering.}

END OF ADVERTISEMENT

The Usual Suspects

Comcastaways: Every few years, big media and entertainment companies get bored and decide to shake thighs up to boost their share price. Well, after watching David Zaslav wipe 70% off the market cap of Warner Bros. Discovery $WBD ( ▲ 1.84% ) , and Shari Redstone wipe $17 billion - also about 70%, off the value of Paramount $PSKY ( ▼ 4.31% ) , only to be saved by nepomogul David Ellison and the deep pockets of his dad (and Oracle founder) Larry, it looks like Comcast $CMCSA ( ▲ 0.67% ) CEO Brian Roberts is heading down the same path. After failing to win the bidding for Warner, Comcast is spinning off its NBC Universal broadcast and programming unit from its core cable and telecom business just months after NBC had its own re-org, hiving the MSNBC and CNBC gabfests into a new company called Versant (no, it’s not a new alcohol-free bubbly wine). The news pushed Comcast stock up 4% on Monday, and raised the specter of a new round of media mergers. This may be good news for shareholders, who saw Comcast’s P/E ratio below that of nearly every other stock in the S&P 500. “Comcast now sheds its conglomerate discount and each company can adopt a capital structure appropriate for the times,” analyst Craig Moffett of MoffettNathanson wrote in a note to clients on Monday. It will take a while for the mechanics of the deal to close, but expect the media dealmaking chatter to begin. Already this year Charter Communications $CHTR ( ▲ 0.61% ) and Cox Communications $COXCF ( 0.0% ) are tying up a $34.5 billion merger, and Fox $FOXA ( ▲ 0.66% ) just bought Roku. Shares in Comcast are down nearly 30% in the past year.

Paramount’s European Adventure (UK and EU) - the Paramount - Warner merger appears to have jumped one of the few remaining hurdles to its completion, offering some so-far unknown concessions to meet EU anti-trust and public access rules. But the EU is still examining whether the financing from Saudi and Qatari sovereign wealth funds amount to a foreign subsidy for the deal, worth $110 billion including assumed debt. The combined Paramount/Warner would be an entertainment powerhouse, uniting HBO, CNN, CBS, Paramount Pictures and Warner Bros studios. But a couple of sticking points remain. California Attorney general Rob Bonta is reportedly considering blocking the deal unless Paramount spins off CNN, and British culture minister Lisa Nandy said she is "minded to intervene” in the deal, which is Britspeak for seriously considering an investigation. That would add another 40 days to the timetable.
Take it lying down? Many of the world’s top airlines are flying empty luxury seats because their new configurations haven't yet passed strict U.S. safety tests. The rules affect airliners from both Boeing $BA ( ▼ 0.82% ) and Airbus $EADSY ( ▼ 0.27% ) and airlines including Lufthansa $DLAKY ( ▲ 0.94% ) Delta $DAL ( ▲ 2.21% ) , United $UAL ( ▲ 2.24% ) , American $AAL ( ▲ 3.27% ) and KLM. The problem is that new offers, like locked cabins and lay-flat seats, can affect the way the human body reacts to a crash or inflight turbulence, or even how quickly passengers can evacuate a plane. The testing can take years, and some airlines are now pulling out the new seats and putting back old-fashioned first-class recliners.

Dimon’s endgame: Is this the end of the road for Jamie Dimon, the tough-talking, f-bomb throwing, 70-year old CEO and chairman of JPMorgan Chase $JPM ( ▲ 1.47% ) ? The bank has named two senior bankers co-presidents, and given them each a $30 million retention bonus. Doug Petno and Troy Rohrbaugh appear to be jousting to see who follows Dimon’s 20-year run as the bank’s supremo. Previous top contender Marianne Lake, 56, said she’s leaving the bank. Not so fast, though. The new appointments will need time to be tested in their new roles, and the Wall Street Journal said people close to Dimon expect him to stick around for three more years, and then continue to kibbitz from his seat as executive chairman. JPM shares are down almost 3% since the announcement.

Tech Talk

If you can’t beat ‘em, grease ‘em. Following on reports that OpenAI $OPEAZZX ( ▼ 0.28% ) is postponing its IPO to next year, after SpaceX $SPCX ( ▲ 2.6% ) sucked all the cash out of the market, CEO Sam Altman has come up with novel idea for getting the federal government to buy in to his company’s plans to dominate the world of AI: Give the government 5% of the company. The Financial Times reports that Altman’s in talks with the feds, including Treasury Sec. Scott Bessent and Commerce chief Howard Lutnick to use the stake to fund a sovereign wealth fund for Americans affected by AI job displacement. The plan would require OpenAI’s competitors, including Anthropic, Google $GOOG ( ▼ 0.69% ) , Meta $META ( ▲ 4.7% ) , and Microsoft $MSFT ( ▲ 0.27% ) , to also hand over stakes to the feds, but none of them have signed on. Altman seems to be on the same page as Senator Bernie Sanders, who last month pledged to introduce legislation for a one-off tax of 50% on the stock of the largest AI companies. Sanders said the tax would create a $7 trillion fund generating hundreds of billions of dollars a year in direct payments to Americans and to health care, education and housing programs. “The benefits cannot simply go to the handful of wealthy corporations. They will be shared by the American people,” Sanders told the AP.
Meta’s compute pop (and fall): How do you make $160 billion in a single day? Rename your overhang as excess inventory. That’s what Meta $META ( ▲ 4.7% ) did this week when it announced it was creating a cloud computing business to sell its excess AI compute power to other businesses. Suddenly, it went from overbuilding data processing capacity to entering a growing business. That caused the stock to pop nearly 9% on Wednesday. But the numbers tell a slightly different story: Meta said it will spend $145 billion in capex this year, constructing data centers and buying GPU chips to train AI models. The cloud business reassured some shareholders that Meta might not lose so much on its AI buildout. Meta’s also already signed $47 billion worth of computing leases with data center builders Coreweave $CRWV ( ▼ 0.33% ) and Nebius $NBIS ( ▼ 0.13% ) , whose shares plunged 12% on Meta’s announcement that it was about to compete with them. So what’s it really about? Zuck seems to have taken a page from Elon’s playbook, when SpaceX $SPCX ( ▲ 2.6% ) announced it was leasing Colossus capacity to Anthropic and Google $GOOG ( ▼ 0.69% ) : If you overbuild and don’t have the demand (or even a decent AI to run), you can reduce your losses by renting out all that surplus inventory. If anyone else wants it. Then Zuckerberg told employees that AI agent development hasn’t accelerated as expected, and the stock fell around 5%.

The Short Stack

Steak and Eggs: With the U.S. beef herd at its smallest since 1951, farmers are finally getting decent prices for their cattle. But meat packers say they are hurting, losing about $300 per head. Worried about the small and medium-sized packers that slaughter and slice only about 15% of U.S. beef, the Dept. of Agriculture is promising them as much as $500 million in payments to keep working.The move comes as the Big Four U.S. packers, Brazil’s JBS $JBS ( ▼ 0.76% ) , Tyson Foods $TSN ( ▼ 1.01% ) , Cargill, and Brazilian-owned National Beef stand accused by ranchers of price-fixing to keep down the price of cattle, as beef prices hit all-time highs. Meanwhile, the feds have proposed a settlement to the Great Egg Price Fixing Scandal of 2022-2025, when three of the largest U.S. egg producers Cal-Maine $CALM ( ▲ 0.32% ) , Versova, and Hickman's Egg Ranch co-ordinated by phone and text message to inflate prices on the Egg Clearinghouse spot market. Under the settlement, the three will pay a total of $3.3 million in fines and donate 50 million eggs to food banks.
Why not you? More than 440,000 Americans became millionaires this year, or about 1,200 every day, according to a new report from Swiss bank UBS. Most of that was due to stock market gains (the Dow $DJI ( ▲ 0.27% ) rose 13.4% in 2025, and the Nasdaq Composite $NASDAQ ( 0.0% ) rose 20.36%). On average, the American adult was worth $696,277 at the end of last year, just behind Switzerland. The U.S. now has 23.6 million millionaires. Felling rich? Don’t max out your credit cards just yet. The Fed’s tri-annual household survey says the median income for Americans was only $192,700 in 2022. That’s because a few outliers (We’re looking at you, Elon) can skew the average. The next Fed survey results will be out this fall.

Trumplandia

Donald makes book, and JD makes book on books: Sometimes, it’s not friends in high places that you need, it’s simply being in high places. President Trump’s financial disclosure forms released this week show he made at least $2.2 billion in 2025, up from $622 million in 2024. The main source of all that money? Crypto deals. Trump’s holding in World Liberty Financial $WLFI ( ▲ 0.52% ) , founded by the son of Commerce Sec. Howard Lutnick, earned Trump $799 million, and the sale of those Trump memecoins? $636 million. If you held on to your Trump coin, it’s down 96% since it peaked in January 2025. Memberships and meals at Mar-a-Lago earned him $77 million, up $27 million from a year earlier. Coming in next year’s disclosure: The president’s income from a tungsten mining deal in Kazakhstan, which Trump personally approved. The U.S. government offered up to $1.6 billion to finance the deal. Who won the contract? A firm in which Don Jr. and Eric Trump, and Lutnick sons Brandon and Kyle, have an interest. (In fact, the New York Times found 14 mining companies, with some $8.9 billion of federal contracts or guarantees in which the Trump or Lutnick scions have an interest). Twitter commentators have been having a field day with the numbers:

But even a step down the ladder, there’s money to be made. Vice President JD Vance has his cash spread among standard ETFs, and a stake of $250,000 - $500,000 in bitcoin, some venture capital investments, and between $1 and $5 million in royalties from his controversial memoir “Hillbilly Elegy.” He was a self-confessed “never Trumper” when he wrote and sold the book as a student at Yale Law School, and even considered voting for Hillary Clinton out of distaste for his future boss.
What Will Kevin Do? The June job numbers out this week won’t help the Fed with a rate cut argument. At 57,000 new jobs, the count was underwhelming and only half the 113,000 the Fed had expected. Even after revising the May number down to 129,000 new jobs from a first guess of 172,000, and seeing participation drop to 61.5%, its lowest since 2021, unemployment is at a sustainable 4.2%. “The labor market may be stable, but it exhibits a high degree of job growth concentration,” said EY Parthenon chief economist Greg Daco. The worst news in June was the leisure and hospitality sector losing 61,000 jobs, the largest decline since the pandemic, with weak seasonal hiring, despite the the World Cup. “The labor market is stuck in second gear,” Daco added, with labor demand remaining “selective” amid “substantial negative shocks to labor supply from demographics and net migration.” That leaves the Fed focused on fighting inflation. And where’s inflation? Last month’s 4.2% annual number is already dropping, and once oil prices hold steady at pre-Iran War levels, it will likely sink back to about 2.5%, as the economy simultaneously absorbs the full shock of last year’s tariffs, says Claudia Sahm, chief economist at New Century Advisers. In other words, “Nothing in this report would lead us to change our long-standing view that the Fed will remain on hold in 2026,” said EY’s Daco. So why are markets still nervous and why are yields on T-bills staying high? Maybe because Warsh’s new policy of issuing far less guidance than Jerome Powell or other Fed chiefs leaves little to work with. Does Warsh still think the Fed should cut rates because productivity will rescue us from inflation, as he told Congress (and Donald Trump) before his confirmation? “It is one thing to reduce the amount of communication and quite another to leave the markets completely in the dark about your reaction function,” says Ethan Harris. a former Fed Economist and current Fed watcher. Polymarket traders now overwhelmingly expect no more rate cuts in 2026.

(Polymarket)

More tariffs? Remember that US-Mexico-Canada Trade deal which replaced NAFTA? The one negotiated by Trump, who called it “the largest, fairest, most balanced, and modern trade agreement ever achieved?” Well, now Trump trade negotiator Jamieson Greer, says the U.S wants to scrap it. The accord was supposed to be renewed this year for 16 more years, but Grier says it can stay in place while talks continue on its “shortcomings” and U.S. trade deficits with its neighbors are resolved. Otherwise, the accord gets ripped up. That’s bad news for trade, and particularly for U.S. carmakers who’d worked NAFTA into their production but now pay tariffs on parts and assemblies that cross borders.
And there’s that pesky trade agreement with Europe - the one that the EU just approved. Now President Trump is threatening to slap 100% tariffs on any European nation that taxes U.S. tech giants. How serious is he? Well the U.K. has been taxing U.S. tech firms including Google $GOOGL ( ▼ 0.84% ) and Meta $META ( ▲ 4.7% ) for several years now, and so far, Trump hasn’t put any new tariffs on them.

Want more Cheddar?

Making Sense of Market Volatility In A Turbulent Week

Cheddar's Big Business This Week — Thu, 25 Jun 2026 20:30:00 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

What the heck, Wall Street? Was there a tech sell-off this week? Perhaps?! Who knows?!

Through Thursday afternoon, some tech shares had dropped, with the Magnificent Seven tech stocks down a collective 6%, the Nasdaq down 4% and the S&P 500 down 2%. But the Dow was up 1%, and given the volatility of all markets these days, trading on everything from the price of oil to the whims of president Trump, it’s no surprise. Amazon dropped 4.75% on Monday. Tesla fell 5.8% on Tuesday. Apple (see our story on the company, below) dropped more than 5% on Thursday. To make sense of what’s going on in the markets, BBTW columnist Peter Green spoke with Jim Cagnina, Senior Market Strategist at NinjaTrader Live, a daily, expert-led livestream and educational platform designed for futures traders.

(Google)

Why such a big selloff in tech stocks?

Markets generally do not respond well to uncertainty, and right now there’s plenty of it. Geopolitical tensions, lingering inflation concerns, and their impact on interest rate expectations, and end-of-quarter portfolio reshuffling all hit at once in this particular situation. Combined with the fact that tech stocks and AI names have been sitting right around all-time highs for months; you've got a recipe for “profit-taking.”

How far down is the selloff likely to go?

According to many pros out there, we haven't even hit what traders consider the first real test level yet. Using a standard technical measure from the industry called Fibonacci retracement, neither the Nasdaq nor the S&P 500 has pulled back from their recent run-up. Until we see deeper levels tested, this still looks more like a pause than a full collapse.

Was this week's pullback more of a healthy correction or the start of a broader shift in sentiment?

Only time will tell. The term “correction” can be somewhat misleading because it implies that prices were somehow "incorrect" beforehand, but from a technical standpoint, the recent decline remains relatively modest.

Is it fundamentals — or is AI just getting ahead of itself?

From where I sit everyday, I can confidently say it’s both. The underlying demand for AI infrastructure is real, so components such as copper, data centers, and energy remain critical components in power generation. Those needs aren't going away any time soon. However, the stock prices of AI-adjacent companies have been running far ahead of the actual revenue those companies are producing, and that gap is what makes investors nervous.

People are saying there's no evidence companies actually want to use all that AI compute. Is that why it feels like a bubble?

That's the core tension right now because the infrastructure buildout is massive, but the proof that everyday businesses are adopting and paying for AI tools at scale just isn't in front of us yet. When you're spending trillions on capacity before the customers show up, that's where bubble talk starts.

(This interview has been edited for clarity and condensed)

—Peter S. Green

Big Businesses mentioned this week

$AAPL ( ▲ 0.9% ) $PG ( ▼ 1.04% ) $ACI ( ▲ 2.58% ) $CAR ( ▲ 4.24% ) $TSLA ( ▲ 3.17% ) $WELL ( ▼ 0.76% ) $SPCX ( ▲ 2.6% ) $KALSHI ( ▼ 3.91% ) $META ( ▲ 4.7% ) $POLYMARKET ( ▲ 3.66% ) $IBM ( ▼ 2.24% ) $AMZN ( ▲ 1.4% ) $TM ( ▼ 1.6% ) $GM ( ▲ 0.54% )

This week, big business!

Brexit, What Was it Good For? Absolutely Nothing?
The Usual Suspects

Brexit, What Was it Good For? Absolutely Nothing?

Ten years ago this week, the United Kingdom voted to leave the European Union and its frictionless, tariff-free single market of 430 million people. Brexit has since turned into a drag on the U.K. economy, and the reasons Brits voted for it are a lot like why Americans voted for Trump and the MAGA movement: The sense that taking back their sovereignty, and sealing their borders would somehow restore high-paying jobs to ordinary citizens. It hasn’t worked out, so far, in either place.

To understand what Brexit could teach the U.S., BBTW columnist Peter Green spoke with former Irish central bank governor Patrick Honohan, now with the Peterson Institute for International Economics, a non-partisan policy center in Washington. (This interview has been edited for clarity and slightly condensed).

Ten years on from the Brexit vote, and a year and a bit from the Trump tariffs, both Britain and the U.S. seem to have trapped themselves into a low-growth, high-inflation scenario while somehow thinking the world needed them more than they needed the world. What are the parallels?

PH: For me the economics policy parallels are not all that close, but there are parallels in the way politics has evolved in both the U.S. and Britain, with populist/nativist narratives becoming dominant. Brexit introduced significant trading barriers between the U.K. and the E.U. and Trump’s tariffs have increased trading barriers between the U.S. and the rest of the World. However, the Brexit motivation was to “take back control” over domestic policy: Brexiteers imagined that they could improve and increase trading with the rest of the world thanks to a supposed ability to reduce onerous E.U. regulation of industry. Any gain on this front (and there has not yet been much deregulation in Britain) has been more than offset by the tariff and especially the administrative barriers to British exports to Europe.

Can the effect be measured?

It’s hard to get a reliable precise estimate of the quantitative impact on the British economy, but few experts would contest a figure of minus 5 percent as the impact of Brexit on the U.K. economy by now. This is in line with the more credible estimates that were made by economists pre-Brexit. And future growth is also likely to be slower than it would have been without Brexit.

One parallel with the U.S. is on migration. Despite immigration from the rest of the EU having been one of the factors leading to a support of the Brexit proposal from nativists, the post Brexit period has seen a massive surge in net immigration, as there was a relaxation of the immigration rules for those coming from other countries. The [current] immigration slowdown reflects nativism in action and will, of course, have an adverse effect on growth in future years in both the U.S. and the U.K.

What lessons should the U.S. have absorbed from Brexit and its economic fallout? What might have been different had those lessons been absorbed?

[The] biggest impact of the Brexit debate and outcome was the political polarization that it both reflected and exacerbated. Centrist politicians in the U.S. could have seen this (also from the election leading to Trump 1) and worked to seriously address the concerns of the “left behind”. Instead they continued to treat them as deplorables.

What story do the numbers tell?

As mentioned, the GDP impact of Brexit is serious but not catastrophic. Catastrophist forecasters who anticipated a financial meltdown were proved wrong. But the deteriorating fiscal situation has made bond markets jumpy in the UK (as witness the mini-crisis that brought down Liz Truss’s government in 2022.) This could increasingly become a risk for the U.S. the way the Federal debt is growing.

Canada and the E.U. were our biggest trading partners in the U.S. — That’s in jeopardy (in fact Canada still has a massive surplus with the U.S.). What can or should we do now about it?

This one is easy. Stop imposing tariffs and stop insulting these trading partners, just as the Labour Party in the UK are gradually rebuilding relations with the E.U., potentially rejoining the single market in a limited way before too long.

What effect has the Iran war had on all this?

It certainly worsens the environment for U.K. policy makers, especially given their high indebtedness. For the U.S. it’s not as bad, despite their high indebtedness, given the degree to which the U.S. is an energy exporter.

Stepping back for the big picture, what is it that the U.S. policymakers don’t understand?

International collaboration based on the predictable application of trade law offers the best growth opportunities—not only for middle-size countries like the U.K., but also for the U.S.

So where do we go from here, and what happens if we don’t mend our ways?

I’ll pass on this one, if you don’t mind.

(This interview has been edited for clarity and condensed)

END OF ADVERTISEMENT

The Usual Suspects

Apple Sauced: Don’t say you weren’t warned. Last week, Apple $AAPL ( ▲ 0.9% ) CEO Tim Cook said competition from the AI buildout was raising the price of chips and other components in Apple’s devices, and a price hike was coming. That hike came Thursday, as Apple briefly shut its online store to reprice, and when the lights came back on, Macbooks were $100 more expensive. iPads got pricer, too, but iPhones did not. That’s expected for the next version of the iPhone, due out sometime soon-ish. Cook made the move in part because Apple’s hefty profit margins are what keep its share price and its P/E ratio (35.4 x on Wednesday) aloft. The price hikes put a quick damper on Apple’s price, but it’s likely that will wear off as consumers budget for the higher prices, analysts say. In afternoon trading Thursday, Apple was down about 5.6%, and that P/E ratio had shrunk to 33.45. So, at least Apple’s shares are on sale.

(Google)

What brands will do for eyeballs! Fast-moving consumer goods company Procter&Gamble $PG ( ▼ 1.04% ) has teamed up with the Albertson’s $ACI ( ▲ 2.58% ) grocery store chain for a sitcom micro-series called “Rico’s Tacos” about, of course, the cutest Mexican taqueria, with Dad Rico behind the counter, his daughter and the abuela. It’s a scripted show that aims, ultimately, to sell P&G products. Screens in Albertson’s 2,244 stores will show clips and a QR code to the Albertson’s app, where shoppers can watch "full" episodes that last up to two minutes each. Call it a modern-day soap opera. Currently, about 3% of all retail media advertising budget is spent on in-store advertising, or about $600 million. Emarketer says that could hit 1.1 billion in 2029.

(Rico’s Tacos)

Trying harder will do that for you. Perennial second-place car rentals company Avis $CAR ( ▲ 4.24% ) just scored a major win: A $650 million payment from one of its own major shareholders, hedge fund Pentwater Capital Management, which Avis blamed on Pentwater trying to short the company’s stock. Avis noted Pentwater was the only major trader in its shares when they rocketed up 560% in mid-April, then plummeting in a matter of days. Unfortunately for Pentwater, a little used SEC rule called the Short Swing Profit Rule, forbids shorts by big shareholders, and requires them to forfeit their gains to the company. Ka-ching! Avis’ shares dropped 65% from the shorting-induced high, but they’re still up 75% from where they were before the shorting began.
Raking it in. CEO’s are raking in the dough again, with more than two dozen making more than $100 million a year, and nearly a dozen topping $200 million. Sounds like a lot, but then, of course, there’s Elon Musk, who secured a $158 billion pay package last year at Tesla $TSLA ( ▲ 3.17% ) . How does that make you feel? Even the second highest-paid CEO in the country, Shank Mitra, got only $821 million last year from the senior housing and healthcare real estate firm he runs called Welltower $WELL ( ▼ 0.76% ) . That’s as the share of corporate income used to pay workers has dropped from 84% in 2008 to 71% today, and the war in Iran has wiped out the wage gains of U.S. workers since January 2025. The Wall Street Journal has diced the data in some cool charts.
M&M’s Get the blues with a MAHA makeover: Under pressure from Trump health secretary RFK Jr.’s “purity of essence” campaign to rid American food of artificial dyes, Mars, the privately owned maker of M&Ms says it’s having a harder time than it expected coming up with the requisite colors “au naturel.” Yellow, red and orange were easy, but blue and green (aka “the best color,” by popular consensus) have been a lot harder to create from organic matter. Now, Mars may have crossed that bar: It’s found a solution for blue and green: a plant called “spirulina,” better known as algae. If only there were somewhere they could go to find an excess of algae this week, huh?
Predictably: Buying SpaceX $SPCX ( ▲ 2.6% ) wasn’t enough of a gamble for you? Now online prediction market $KALSHI ( ▼ 3.91% ) says it’s prepping to take investors’ money on a ride to the moon and back. CEO Tarek Mansour said an IPO won’t happen this year, but reports say the company may sell shares by 2028. A year ago, Kalshi raised $185 million at a $2 billion valuation. In May it announced a funding round that valued the whole firm at $22 billion. With Facebook $META ( ▲ 4.7% ) struggling to find new sources of revenue as its advertising sales begin to stagnate, that kind of money has drawn the attention of CEO and founder Mark Zuckerberg. After failing to convince the world to don AI goggles, Zuck now thinks the next cool thing is prediction markets, and has developers creating an online app for just that, called “Arena.” At first it will use only points, but a company spokesperson told the New York Times it could eventually take bets in real money. Back in 2020, Facebook tested a prediction app called Forecast, that started with asking participants to make forecasts about Covid. But the app failed (it was too complex to explain here) and was pulled in 2022. Over at Polymarket $POLYMARKET ( ▲ 3.66% ) , the other big prediction market, the Wall Street Journal found that the company has been paying social media influencers to make videos that look like they’ve just made a killing on Polymarket. Instead, they made fake trades on a cloned website. It all sounds a bit cheeky, really.

IBM’s Quantum leap: After selling its laptop brand to Lenovo, IBM $IBM ( ▼ 2.24% ) is actually still making computers. Mostly the kind that companies buy to do really big math problems. And now it's preparing to tackle the biggest math problems at scale. IBM says it's creating a foundry for making quantum computing chips in upstate New York, which it will both sell to rivals and use for its own applied quantum computing. IBM is looking at 2029 to launch a reliable quantum computer called Starling, and an even bigger one in 2033. The Trump Administration has pledged $1 billion in the IBM venture.
OpenAi Unplugged? An Amazon-funded biopic of OpenAI founder Sam Altman and his travails at the AI firm has been dropped by Amazon’s $AMZN ( ▲ 1.4% ) film studio division, after being filmed, cut and shown in test screenings. “Artificial” is directed by Luca Guadagnino, who made “Call Me by Your Name,” and was scheduled to premier at SXSW next year. Amazon would only say that the movie would “be better served if it were released by a different studio.” A possible reason for the axing: Amazon has pledged $50 billion of investments in OpenAI this year.

(Luca Guadagnino (left) and Sam Altman (right) — Getty)

Toyota looming in GM’s rear view mirror. As the Iran war pushes consumers to hybrids, Japanese automaker Toyota $TM ( ▼ 1.6% ) is poised to once again overtake General Motors $GM ( ▲ 0.54% ) as the best-selling carmaker in the U.S. market. Analysts expect GM to outsell Toyota by only 83,000 vehicles in the first half of the year, and it could get tighter. “GM may be looking over their shoulder here when we get to the year’s end, that Toyota could potentially overtake them as the top selling manufacturer here in the U.S. market,” said Charlie Chesbrough, senior economist at Cox Automotive. Toyota beat out GM in U.S. sales once before, as supply chain woes devastated the car industry in 2021. GM has put its money on all-electric vehicles, and its only hybrid is a Corvette. Toyota makes some EVs, but continues its focus on hybrids. Speaking of EVs, Jeff Bezos-backed Slate Automotive has set a price for its stripped down two-seat EV pickup truck, with hand crank windows and no radio: $24,950. Sales are expected to start this fall. EV stalwart Tesla’s $TSLA ( ▲ 3.17% ) sales across Europe doubled in May from a year earlier, to 28,610 units.
Sometimes, it’s easy to forget that SpaceX $SPCX makes rockets. And rockets do one thing really well, go up and come down. That’s a trait apparently baked into the DNA of SpaceX shares as well. Two weeks on from its IPO, the shares are within spitting distance of Earth again. From a quick high of $225, they’ve dropped to $152, and briefly ducked below $150, the price when it began trading last week. Shares fell 16.4% on Monday, after SpaceX floated the idea of bond sale, borrowing money right after its $85.7 billion IPO. Retail investors are now nervously awaiting the end of the various lockup periods when early private investors and institutions will get to cash out the stakes they bought at tenth or less of the IPO price. While SpaceX has yet to be profitable, it has found a new revenue stream: Renting out its AI data centers to other AI companies. Next month it will start booking $150 million a month from renting compute to startup Reflection AI. That follows rental deals with rivals Anthropic and OpenAI. So what’s behind this? Yann LeCun, founder of AI company AMI Labs, says SpaceX’s xAI business is failing because Musk has driven away the talent the company needs to be an AI heavyweight. “Elon is now in a position that is very, very difficult for him to kind of hire top people in AI, because he’s kind of, you know, not behaved in sort of very good ways toward the ... previous team,” LeDuc told CNBC.

Want more Cheddar?

The W⚽️rld Cup Is a Money Machine. But for Whom?

Cheddar's Big Business This Week — Thu, 18 Jun 2026 20:30:00 +0000

FIFA’s soccer World Cup promises to deliver $11.1 billion in spending and $30.5 billion economic impact for the U.S., but how much is it really helping the American economy? BBTW editor Peter Green spoke with Victor Matheson, a sports economist at College of the Holy Cross, in Worcester, Mass., who has spent years studying the economics of mega-events, including the Olympics and World Cup. With the 2026 World Cup spread across the United States, Canada and Mexico, Matheson sees a tournament that may be cheaper to host than past editions — but it’s also still unlikely to deliver the vast local economic windfalls promised by FIFA and host committees. Instead, FIFA itself is expected to reap a profit of about $11 billion.

What makes this World Cup different economically from past tournaments? Qatar reportedly spent $200 billion to host the 2022 World Cup.

Most estimates are between $50 and $100 million per city, and that's 11 cities in the United States. So, you're looking at maybe $1 billion of hosting costs, which we still shouldn't be thrilled with, because FIFA could have borne those costs themselves. That being said, it's still a tenth of what was spent in Brazil [$13.5 billion in 2014], and less than 1% of what was spent in Qatar.

It looks like the biggest change was that by spreading the games across three countries that already have full-sized stadiums, the cost came way down.

That’s right. There was no new stadium construction, although we put some coats of paint on things. We had a couple of stadiums where we had to widen the field to be big enough for FIFA standards. And we did spend a bunch of money swapping out turf for real grass in stadiums. So, there's millions or tens of millions of dollars spent on stadiums, but not billions. And we spent a bunch of money and millions of dollars covering up advertisements in stadiums if they conflicted in any way with FIFA's advertising sponsors.

So what are the real direct costs?

Maybe you can go as high as $2 billion. This is the cost of security, additional transportation, sanitation, transporting players around, stadium controls, all these things. Although we don't have any uniform numbers across all the different cities, we know we're in the billion or low, low single digit sort of zone. It’s a fraction of what was spent in the past, because there really aren't any major construction projects that are part of this event.

FIFA and local boosters argue there will be huge knock-on effects. How seriously should we take those claims?

If FIFA is trying to justify subsidies directed towards FIFA because of all the great things FIFA is going to do for you, that should be something that raises gigantic red flags with anyone, right? There's no doubt that there's going to be some level of tourism impact here that's positive, but it is likely to be significantly less than FIFA advertises. A big factor is what's known as the substitution effect, where economic activity occurred one place in a local economy, rather than somewhere else. So for example, I am going on Friday here in Boston to see Scotland versus Morocco. Those are expensive tickets, $400 each. That's $400 that I don't have available to spend elsewhere in the local Boston economy this year. It's not like my entertainment budget all of a sudden magically grew by $400. That's not new money that's getting spent in Boston, that's just shifting around where in the greater Boston area that money's getting spent. That's a substitution effect to the extent locals are going to the World Cup. And a lot of the people are local. That means that's not new economic impact. It's just a substitution effect.

So FIFA may be taking money that would have gone to local businesses?

Right. If I'm the usual bar goer, and I spend my money this summer going to Boston Soccer Stadium, instead of my local bar. Yes, that's money that FIFA's getting instead of my local bar. So that's a substitution away from my local bar towards FIFA.

What about ‘crowding out’?

Crowding out is when the crowds and congestion associated with something keeps other sort of economic activities from happening. Hotels are pretty full and they are full of soccer fans. But those hotels would be full of other types of tourists instead because we're now hitting our summer stride here. So, Boston hotels are usually 80 percent full all through summer. So, we have crowded out the regular economic activity. Right. And so we need to make sure we account for that when we're talking about economic impact. In 2024 in Paris during the Olympics, all the hotels were full, but the hotels are always full in Paris in summer. And during the Olympics, attendance at the Louvre and at the Musée d'Orsay was down about 25 percent. So you displaced one kind of tourist with a different kind of tourist. Same thing happened in the Olympics in London as well in 2012. They actually shut down some of the West End shows that normally would be on, again, because of a lack of that kind of tourist.

And what about ‘leakage’?

Leakage happens when money gets spent locally but doesn't stick locally. So, for example, if I go down to that local brew pub, here in Worcester, the Greater Good Brewery, which is a locally owned brewery, I go and I get a beer and I tip my server. Well, that brewery owner and that server are going to take my money, then they're going to spend it elsewhere here in the local Boston or Worcester economy. They're going to buy a haircut and then that barber is going to spend money at the market. And of course, that money circulates through. But during mega events like this, you may have a lot more of that money leak out of the economy right away. So, for example, the money I spend on tickets, none of that ever finds their way into any local business, that immediately heads back to [FIFA in] Switzerland. So no one is actually made better off in Boston by spending that money.

So who benefits most from the World Cup?

FIFA, number one. FIFA is going to make somewhere between 10 and maybe 13 billion dollars on this event both from record large crowds, but also record expensive ticket sales. They're going to benefit from gigantic TV ratings. Oddly, despite high ticket prices, we're seeing some really good crowds, typically sell-outs.

But FIFA is promising $30 billion in economic impact to the U.S. What should we expect when economists look back after the tournament?

When we actually go back and look at the economies of host cities, we will not find that level of economic impact. I think we will find a level of economic impact that’s positive, but I don't think we're going to find anything close to what FIFA is claiming, roughly a billion dollars per city. I think that's unlikely.

What did economists find after the 1994 World Cup in the U.S.?

We looked at the results from the 1994 World Cup in the United States. In that event, FIFA estimated $4 billion of economic impact for each host city. When we actually looked back at the host cities that did host games, we compared them to cities that didn't host games. We found that the host cities actually did about $4 billion worse than you would normally have expected them to do. It wasn't statistically significantly different from zero, but certainly we didn't get any evidence that there was any sort of surge. The numbers are always below projections. On average, the effects are either small or not distinguishable from zero.

(This interview has been edited and condensed for clarity).

—Peter S. Green

(x.com)

Big Businesses mentioned this week

$YUM ( ▼ 1.73% ) $YUMC ( ▼ 0.96% ) $APO ( ▲ 1.44% ) $SPCX ( ▲ 2.6% ) $FOX ( ▲ 1.02% ) $ROKU ( ▲ 0.73% ) $AMZN ( ▲ 1.4% ) $NFLX ( ▼ 0.16% ) $AAPL ( ▲ 0.9% ) $PSKY ( ▼ 4.31% ) $WBD ( ▲ 1.84% ) $TSLA ( ▲ 3.17% ) $RIVN ( ▲ 8.76% ) $META ( ▲ 4.7% ) $ANTHZZX ( ▲ 0.37% ) $OPEAZZX ( ▼ 0.28% ) $SNAP ( ▲ 1.51% )

This week, big business!

War Story
The Usual Suspects
Tech talk
Trumplandia
Want more Cheddar?

War Story

MOU-ving In The Right Direction? Whether it’s a Memorandum of Understanding or Misunderstanding, whatever comes out of the latest talks between the U.S. and Iran looks like it will reopen flows of oil from the Persian/Arabian Gulf. But it’s unlikely that’s going to happen fast enough for the global economy to swiftly rebound. In fact, the global economy may have been permanently altered as countries remember that energy autonomy is a national security issue, and start building stockpiles and switching away from oil they can’t drill themselves. Brent crude futures dropped to $78 a barrel this week, close to the $75 it was trading at just before the U.S./Israeli bombing campaign began. Still, it will take months before all the oil now trapped in the Gulf reaches refineries and consumers, and more months before those tankers fill up again and global oil traffic returns to normal. Meanwhile, inflation in the U.S. is over 4.2% and the new Fed chair is not cutting interest rates. Japan has hiked rates to 1% (yes, 1%) its highest rate in 31 years, to fight inflation. And with Iran expecting to resume oil exports without any sanctions, there could be a price war that would alter global capital flows. That’s all before the U.S. gives Iran $24 billion in frozen assets and starts to create a potential $300 billion reconstruction fund for Iran. In other words? Nobody is out of the woods, just yet. Hillary Clinton wrote a surprising op-ed in the Financial Times praising the deal. “If even I, an implacable opponent of the president, can accept this as the best option, then surely others can too?” she wrote. Meanwhile Texas Senator Ted Cruz hasn’t exactly minced his words in opposition. “History teaches that giving billions of dollars to theocratic lunatics who want to murder us is not a good idea,” he said.

(X.com)

Trade Real-World Events. Get $10 Free.

Start trading real-world events. With Kalshi, you can trade on things you already follow: inflation, elections, sports, and more. It’s simple: buy “Yes” or “No” shares on what you think will happen, and earn returns if you’re right.

To get you started, we’re giving you a free $10. Use it to explore the platform, test your instincts, and see how prediction markets work in real time.

Join thousands already trading the news and putting their knowledge to work.

Claim your $10 and start trading now.

Put $10 to Work

_{Trade responsibly.}

END OF ADVERTISEMENT

The Usual Suspects

Sliced: Yum Brands $YUM ( ▼ 1.73% ) is selling off Pizza Hut. The operation is being sold in two slices: Yum China Holdings $YUMC ( ▼ 0.96% ) will buy the mainland China operations for $1.2 billion, while PE firm LongRange Capital is buying everything else for $1.5 billion. Growing competition and shrinking consumer cash has hit pizzerias hard. Coffee shops and Mexican restaurants are expanding, but the number of pizza shops has declined since 2018. In December, California Pizza Kitchen was sold to an investor group for $300 million, after going private in 2011 for $470 million. Apollo Global Management $APO ( ▲ 1.44% ) withdrew its $2.1 billion bid for Papa John’s last winter as consumer spending fell. Still, according to industry bible Pizza Today (is there a Deep Dish section?), there were still 75,736 pizzerias in the U.S. last year, though revenue fell 0.3%, to $49.5 billion in 2025. Yum brands shares climbed 3.44% on news of the sale, before giving back the gains by mid-week.
We will, we will…Roku. Lachlan Murdoch’s doubling down on Fox’s $FOX ( ▲ 1.02% ) future as king of sports, live-TV content and ad-funded streaming, with a $22 billion agreement to buy cord-cutting device Roku $ROKU ( ▲ 0.73% ) , which has its own free, add-supported on-demand movie and streaming service that will add to Fox’s Tubi. The deal is a lifeline for Roku, which has struggled to make a profit, and will help the combined business compete with Amazon $AMZN ( ▲ 1.4% ) and Netflix $NFLX ( ▼ 0.16% ) for ad dollars. Ad-supported plans now make up nearly half of all streaming signups in the U.S., up from 39% in 2024. But it adds $12 billion in debt to Fox, and the cash and stock deal will dilute Fox’s existing shareholders, many of whom clearly saw the 34% premium Fox will pay as a deal too far. Shares in Fox plunged nearly 18% after the deal was announced Friday, and are now down 21%. Roku shares rose nearly 23% on the news and are still up more than 10%.
(Google)
Disembodying the Spirit: Even in death, Spirit Airlines can find no rest. As it begins selling off assets to pay off its $8 billion debt, Spirit has a dilemma — how to unload its 22 slots (11 sets of takeoffs and landings) at New York City’s LaGuardia airport, one of the most expensive airports in the U.S. The FAA wants a low-cost carrier to take the slots, which could be worth $87 million, the New York Times reports, and the airport’s owner the Port Authority of New York & New Jersey, says whoever buys the slots has to take Spirit’s lease at the Art Deco Marine Air Terminal. But departure fees of $40 per passenger, among the steepest in the U.S., make those slots barely profitable. Meanwhile a Texas maker of recreational airplanes says it wants to buy all of Spirit’s planes, leases and other assets, and revive the airline.
Paramount deal gets Greenlighted: Paramount’s $PSKY ( ▼ 4.31% ) $81-billion deal to acquire Warner Bros. Discovery $WBD ( ▲ 1.84% ) got the approval of the Justice Dept after senior agency officials gave it the go-ahead, even as anti-trust attorneys in the same government agency had yet to decide whether they should sue to stop the deal. The department said the merger will “improve competition across the media and entertainment ecosystem, with benefits for American consumers and workers.” Top Justice Dept. officials fast-tracked the approval even though career lawyers analyzing the deal were leaning toward recommending that it be challenged, the Wall Street Journal reported. “This reeks of corruption,” Sen. Elizabeth Warren, the Massachusetts Democrat who is a staunch opponent of corporate consolidation, said on BlueSky. “The American people need to know if this merger was approved as a political favor.” Paramount shares are down 24.3% this year, dropping the company’s market cap to just over $11 billion. Next up, approval by the European Union, while several U.S. state attorneys general, including in California, ponder their own suits to stop the deal and preserve jobs in the entertainment industry.
Rivian troubles: Tesla $TSLA ( ▲ 3.17% ) competitor Rivian $RIVN ( ▲ 8.76% ) is laying off hundreds of workers in its service and sales units, just as it is trying to win a bigger market share from Tesla and other EV makers with a new electric SUV, the R2. But with a sticker price of $58,000, some buyers say the car is too pricey, even in a leased version, whose monthly payments can top $800, the Wall Street Journal reports. Rivian had revenue of $5.4 billion last year on sales of 42,000 vehicles, but it has yet to turn a profit. Shares in Rivian are down 16% this year, but up 26% from a late May low.

Tech talk

The X factor: There’s one number that may hold the key to understanding the SpaceX $SPCX ( ▲ 2.6% ) IPO: $1.08 billion. That’s how many shares changed hands in the three trading days since Elon Musk’s rocket company went to market. That’s 1.7 times the 639 million shares floated in the IPO. And that’s before individual investors reach the end of their 15-day lock up period. In other words, for many investors, SpaceX was a just a game of the “the bigger fool”: Find someone who’s willing to pay even more for the shares than you did. Now those arguable fools are hurting, as the laws of gravity take hold. After rocketing up from $150 to over $219, SpaceX shares have since fallen to $187, wiping out more than a hundred billion dollars in market cap, a largely notional value at this point.
Among the fools, count the founders of Cursor, the AI vibe-coding tool, which Musk agreed to buy with about $60 billion in SpaceX stock. That deal will go through, as will the cashing out by SpaceX’s initial investors who may see payouts of more than 20x their initial investment. The week’s high briefly made SpaceX more valuable than Microsoft $MSFT ( ▲ 0.27% ) , before dropping half a trillion dollars in value. But it oculd easily drop further. Morningstar analyst Nicolas Owens values the company at $63 a share, about 53% below the IPO price and third of what it was trading for on Thursday. He says there is too much uncertainty about its two biggest programs, reusable rockets and space-based data centers. “Max Q, the moment of greatest atmospheric pressure on a launch vehicle, will come for SpaceX’s stock in the months following the IPO, when successive tranches of stock held by private investors and employees are slated to become available for sale into the public market,” Owens wrote. “We think long-term investors eager to participate in SpaceX’s future will have opportunities to do so with a greater margin of safety than the initial offering is likely to provide.”

(Google)

Meta’s AI-yai-yai problem: Fearful of being an also-ran in the AI race, Meta’s $META ( ▲ 4.7% ) cagefighter-in-chief, Mark Zuckerberg, spent $14 billion to hire one man, Alexandr Wang, along with his firm, Scale AI, and a group of its engineers. In April, Wang delivered the Muse Spark AI model, Meta’s first proprietary AI engine, but two months later, an eternity in AI time, it’s not showing any sign of helping Meta’s bottom line. “Meta needs to provide more proof points of both adoption and commercialization,” William Blair analyst Ralph Schackart, told CNBC. “Investors are looking for Meta to monetize a new AI-first product.” Despite Q1 revenue up 33%, Meta shares are down about 18% in the past year. And on Wednesday, Meta said the executive leading its internal AI transformation, Emily Dalton Smith, was stepping down, which doesn’t exactly bode well.

(Google)

Too smart to start? Anthropic $ANTHZZX ( ▲ 0.37% ) says it's been holding talks with the Trump Administration on restoring public access to its Fable and Mythos 5 models, which the company said have guardrails to prevent them from overwhelming internet security systems or teaching users how to make bombs and start pandemics. Last week, just hours after Anthropic said the limited models would be available, Amazon $AMZN ( ▲ 1.4% ) CEO Andy Jassy told Trump Administration officials his engineers had found a way to “jailbreak” the model and get past the guardrails, and the federal government ordered the Anthropic models shut. Similar models from OpenAI $OPEAZZX ( ▼ 0.28% ) do not appear to have been throttled, and the move comes just months after Anthropic refused to let the Department of Defense use its AI models for autonomous “killing machines.” (OpenAI offered to let the DoD use its models presumably for killing machines, instead). But now, Anthropic has announced it will go public, and is currently valued at $965 billion. A failed IPO could hurt the stock market. That’s created pressure on both sides to reach a quick solution.
Apple takes a (price) hike: Apple $AAPL ( ▲ 0.9% ) CEO Tim Cook says the company will be raising prices amid surging costs of memory and storage chips. "We've been trying to shield our customers from the increases, but the situation has become unsustainable,” Cook told the Wall Street Journal. Price hikes might come at Apple’s next big launch event in September. Research firm TechInsights says that to maintain the profit margins that keep Apple's share price high, Cook would have to boost the price of an iPhone by a cool $275.

(Google)

Snap back? Remember those video-recording Snapchat $SNAP ( ▲ 1.51% ) glasses back in 2016 or so, that you could (theoretically) buy from a vending machine for $99, and use to turn your daily life into a series of Snaps? Um, they’re back. But this time they cost more than $2,000 ($2,190 to be precise) and they’re supposed to…do more. Given the 90% decline in the firm’s share price since then amid a steep fall in advertising, they may be the future of Snap. At least, that’s the plan of Evan Spiegel, co-founder and CEO and a man anxious to succeed. The main question is whether he has enough runway. Snapchat had about $2.8 billion in cash on hand at the end of March, which may not be enough to sustain the $500 million-a-year project. Twitter reactions to the new glasses have been very amusing over the last few days.
(X.com)

Trumplandia

Warsh Going On? At his first meeting of the Fed’s rate-setting Open Market Committee, newly installed Fed Chair Kevin Warsh threw down the gauntlet: He’ll be a hawk on rates for now, despite pleas by President Trump, who appointed him, to lower interest rates ahead of the November elections. The Fed held its benchmark rate at 3.5% to 3.75%, in a unanimous vote. But quarterly economic projections by the other 11 voting members of the panel indicate there could be at least one interest rate hike this year, instead of a cut. After the meeting, Warsh said cutting inflation, which reached a 4.2% annual rate last month, was job one: “We have the capability and commitment to deliver on our price stability objective,” Warsh said. “That’s exactly what we’re going to do.” AI spending and the war-fueled energy price spike have sent prices rising and consumers complaining. With unemployment steady around 4%, Warsh apparently sees little he can do to improve the job situation without first cutting prices. The Fed’s Summary of Economic Projections massively upgraded expected inflation for the year to 3.3% from 2.7% last month, and said GDP was likely to grow by only 2.2%, down from 2.4%. Warsh quickly made clear there’d be no more lengthy jawboning about what the Fed might or might not do. Instead, he wants the Fed to say less, and let it react more to markets. “Warsh seems ready to buck the Fed market feedback loop, where the market digests Fed communications. Instead, he wants more price discovery from the markets, and for the Fed to to digest the markets’ interpretation of economic developments,” Chris Hodge, chief U.S. economist at Natixis wrote in a note. The only problem with that? Everyone is looking after their own short-term gain, and no one is taking the big-picture view. Still, retail sales rose 0.9% in May in a sign that the great American consumer is shaking off gas price shocks, and average U.S. gas prices fell below $4 a gallon for the first time in months this week. So, the picture is nuanced.

(AAA)

Want more Cheddar?

Is the Coming IPO Wave a Financial Trap?

Cheddar's Big Business This Week — Thu, 11 Jun 2026 20:30:00 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

SpaceX starts selling shares this week in the largest IPO of all time, aiming to raise about $75 billion and valuing the company at $1.7 trillion. Anthropic announced its IPO plans last week, and this week OpenAI filed its first IPO papers with the SEC. None of these companies are profitable, and they are seeking billions of dollars of investor cash. Big banks from JPMorgan Chase $JPM ( ▲ 1.47% ) to Goldman Sachs $GS ( ▲ 2.56% ) are applauding the IPOs, but do the numbers add up? To hear the alternative perspective, Big Business This Week columnist Peter Green spoke with Ed Zitron, a Public Relations professional working in the technology industry who’s been increasingly critical and outspoken lately about the tech industry’s giga-IPOs. An edited and condensed version of their conversation is below.

SpaceX $SPACZZX ( 0.0% ) wants $75 billion from investors. Anthropic $ANTHZZX ( ▲ 0.37% ) and OpenAI $OPEAZZX ( ▼ 0.28% ) have already burned through tens of billions of dollars each. These companies aren’t profitable. What is going on here?

The thing no one wants to talk about with the AI bubble is that there isn’t really a business here. Even Anthropic is only getting revenue because it’s subsidizing its customers. Claude Code let you burn thousands of dollars of tokens, and now they have moved customers to token-based billing, and businesses have very suddenly had to switch from a quasi all-you-can-eat model to having to spend what the token basis is, and they quickly find they are burning so much more than they expected. The majority of AI customers have learned to use a product that eventually will not exist, and they have no idea if they can afford it à la carte. It’s a giant cuIt. It generates code, but it also hallucinates, so you have no idea what it costs and no idea if the end product has value. It's laughable to say this stuff has value when you can't say what it costs. We don't even know if the tokens themselves are profitable. None of these companies is profitable. Anthropic raised $95 billion, and they have no real business. They have grown their model through hype or scaring people. A couple of months ago, they said Mythos is too scary to release. I guess not, in the end?

Will these IPOs satisfy their need for cash to prime the pump, and allow them to finally make money?

Dario Amodea [the Anthropic co-founder] just said that the reason they want to go public is so they can get money from public markets because they need more money to train their models. When does their training end? They are desperate to make people think training is a capital expenditure. It's not. It’s pure operating expense, so these companies will be raising money in perpetuity. They could be raising $100 billion a year. Anthropic and the AI firms are currently monetizing executive incompetence. How does any of this ever work out? No one has a compelling answer, no one can explain how they ever stop being the largest welfare recipient of all time.

Is there anything this can be compared to?

I actually don't think there is any company in history that has needed this much money. Not one. And all of them need that much money and they need it regularly. I just don’t see that the markets have the support for it. When the companies finally show actual financials, people will freak out because these companies are not in a good financial state at all. They’ve done a good job of convincing private investors and the media that they are more healthy than they really are.

So what’s the back story here? Let’s start with the first up, SpaceX. Why are they going public?

Elon is a mess. Elon is trying to find a cash exit for himself and his investors. And that money can only come from retail investors. Look, multiple parts of SpaceX’s business do not make sense. It all loses so much money, except perhaps StarLink.

A lot is riding on the SpaceX IPO because it's first out of the gate and because it’s going to suck up all the cash in the market. How will the success or failure of the SpaceX IPO affect OpenAI and Anthropic?

The SpaceX IPO makes things more difficult for OpenAI and Anthropic, because if it goes south, no one will invest in the others. And the underlying economics are a horror show with SpaceX. Rockets are a capital expense burden, but it's the AI side, $7B in capex in the last quarter. The most profitable part of xAI is renting computers to Google $GOOGL ( ▼ 0.84% ) .

Every time you read about a deal with the AI firms it looks like a circle.

Circular finance needs to be made illegal. The only function of some of these deals is to inflate other shareholders, like Google’s, own investment in SpaceX or Anthropic. Retail investors are being used as exit liquidity. And the only thing worse than what's happening at SpaceX is what will happen at OpenAI and Anthropic, which have no business at all.

So who will protect the small shareholder?

I don’t think the Securities and Exchange Commission cares. I don't think we have solid financial regulation in this country. Seeing Goldman say Space X’s revenue will rise 300x? Sellside and buyside analysts have failed the financial industry as well as the small investor. We are going to see in the next few months just how bad an idea this was. Retail investors will get washed out in SpaceX. They are marks for a larger con. I will be shocked if OpenAI makes it to the IPO. But the SEC won't stand in the way and the media will make them look better than they are. If they do hit the IPO, there will be carnage for the investors. The underlying economics for these companies are broken. The sad thing is they are being allowed to float because of the hope of the AI bubble, with no accounting for the fact that these companies will have no profits, ever. And they never will, because no one has been able to make the AI models less expensive to run.

If it’s such a bad deal, why is everyone flocking to it?

The reason this is inflated is because all the people joined in the same way. It’s revealed how much of our economy is run by people who don’t really think about what they are doing. Large Language Models do a really good impression of work, which is all you need to convince the CEO that it’s good. It's an exploitation of executive ignorance. It also shows how many companies are run by people who don’t know what they are doing. I mean, remove AI from this world and go to the CEO and say “I gotta spend 10% of headcount on a tool, that I can’t tell you the results, and I can't tell you the cost.” You’d get laughed out of the building. I don’t want investors to get hurt. That blind faith in some secret formula will only lead regular people into the abyss.

—Peter S. Green

Big Businesses mentioned this week

$JPM ( ▲ 1.47% ) , $GS ( ▲ 2.56% ) , $SPACZZX ( 0.0% ) , $ANTHZZX ( ▲ 0.37% ) , $OPEAZZX ( ▼ 0.28% ) , $GOOGL ( ▼ 0.84% ) , $AAPL ( ▲ 0.9% ) , $APO ( ▲ 1.44% ) , $BX ( ▲ 2.98% ) , $AVGO ( ▲ 3.2% ) , $AMD ( ▲ 5.67% ) , $NVDA ( ▼ 0.66% ) , $CBRS ( ▲ 9.25% ) , $META ( ▲ 4.7% ) , $NDX ( 0.0% ) , $SPX ( ▲ 0.81% ), $KALSZZX ( ▲ 0.95% ), $PLYRZZX ( ▼ 0.49% )

This week, big business!

War Story
The Usual Suspects
Trumplandia
Want more Cheddar?

War Story

The Gulf War Energy Bottleneck That Could Send Oil Soaring Back To 100 Dollars: Donald Trump, Benjamin Netanyahu, and whoever the heck is running Iran all seem content to stay on the Gulf War rollercoaster, ratcheting tensions — and oil prices— up one day and lowering them the next, as the price of oil follows suit, with both a peace deal and full-scale war remaining just out of reach. But the outlook isn't good. While Brent crude fell to just $86.79 a barrel on Wednesday, a bit more than $10.60 above the price on the first trading day after the war began on February 28, and ships have been gingerly leaving the Gulf, few have been entering, and more than 160 large oil tankers remain bottled up behind the Strait of Hormuz. That’s put tremendous strain on the world’s energy supply, and now come fears that oil prices will stay high longer as countries build larger crude reserves so they don’t get whacked the next time rockets fly over the Gulf. Call them "nation preppers,” says the Wall Street Journal, which notes that while it will take 500 million barrels of crude to replenish depleted reserves, there’s only 100 million barrels on ships waiting to leave the Gulf, so it could take a year just to replenish those reserves. And don’t expect oil to stay this low. “Prices may look calm on the screen, but the bottleneck is in tankers, storage tanks, wells, and crews,” says Morgan Stanley’s global commodities strategist, Martijn Rats. He sees Brent crude hitting about $100 a barrel in the third quarter, and only dropping to $80 in mid-2027.

(Google)

END OF ADVERTISEMENT

The Usual Suspects

Flying on Empty? The global jet fuel shortage, and attendant high prices for what jet fuel can be found, are setting global airlines and their passengers up for a bad winter, with airlines planning to cut tens of thousands of flights if fuel prices stay high. They’re up about 50% since the war in the Gulf started in February. Passing on those costs is a conundrum for airlines: They can’t afford to absorb higher fuel costs, but passengers are getting squeezed by inflation. “You need to make sure you’re filling every seat,” an airline industry consultant told the Financial Times. “You can’t fly planes that are empty.”
Hey Siri, What’s up with Gemini? Apple $AAPL ( ▲ 0.9% ) , the traditional laggard when it comes to AI tech integration, says it’s now leapfrogging the competition with an AI-enhanced Siri, built in conjunction with Google $GOOGL ( ▼ 0.84% ) , the creators of Gemini AI. Apple insists it’s not just wrapping Google’s Gemini in a slick white apple envelope, but it's hard to see what else they’re doing: As 9to5Mac put it, four of the five models are “custom versions of Gemini running on Apple Silicon.” The fifth model is just Google’s standard Gemini model trained on Apple-centric data.
Double-Chip Trouble: Nope, it’s not the latest flavor from Ben & Jerry’s, it’s a tie-up of your two worst financial fears: the AI funding circularity and the private credit bubble. Apollo $APO ( ▲ 1.44% ) and Blackstone $BX ( ▲ 2.98% ) say they’ve completed a $35B private credit deal that will fund Anthropic leasing chips from Alphabet $GOOGL ( ▼ 0.84% ) , which already owns about 15% of Anthropic $ANTHZZX ( ▲ 0.37% ) . The circularity doesn't stop there. Alphabet’s Google Cloud is Anthropic's primary cloud provider, and Anthropic uses Google’s proprietary Tensor Processing Unit chips to train Claude AI. And who makes those chips? Broadcom $AVGO ( ▲ 3.2% ) , which not only provides key networking components for Google's data centers, but also agreed to guarantee the private credit loans. Ya know what’s even funnier? The numbers: Nearly half of Alphabet’s $62.6 billion profit in the first quarter, or $28.7 billion, came from writing up the value of its stake in Anthropic. Keeping that stake alive is now a vital part of Alphabet keeping its share price up. And let’s not mention that the deal is straining limits of the $3 trillion private credit market.
‘Nvidia ain’t alone: Las Vegas-based cloud computing startup TensorWave has just raised $350 million to build a data center using chips from Advanced Micro Devices $AMD ( ▲ 5.67% ) , instead of Nvidia $NVDA ( ▼ 0.66% ) . Investors like the idea, valuing the firm at $1.55 billion that nearly quadruples its value in the past year. It joins a roster of firms offering non-Nvidia options for AI labs, including Cerebras $CBRS ( ▲ 9.25% ) , Majestic Labs AI, and Decart. Founder Darrick Horton said he didn't want to have to rely on Nvidia alone. “I don’t like buying things from monopolies,” he told the Wall Street Journal. “You don’t have a lot of leverage.”
Rottweiler 2.0? It was billed as the rottweiler of AIs, a killer so dangerous it couldn't be let loose. But now Anthropic is releasing what it says is a gentler, tamer version of Claude Mythos. This one’s called Fable, and Anthropic says that if it's asked “dangerous” questions about, say, biohazards or weapons systems, it will reroute the query to a dumber version of Claude. But just in case you really want to do something dangerous, Anthropic’s also upgraded Mythos, the AI it said was too dangerous for the public. Only members of the top secret U.S. government-affiliated Glasswing project will get access to Mythos 5, which has fewer safeguards. What could possibly go wrong? According to an essay posted this week by Anthropic founder Dario Amodei, just about everything. “The cyber risks that Mythos-class models present will not be the last that we must face. I believe that biological risks may soon follow, and that serious AI autonomy risks may not be far behind,” Amodeo wrote. Now, he’s urging the government to take swift action to regulate AI.
Return to slender: You would’ve thought that with more than 23% of U.S. households on GLP-1 weight loss drugs, these would be boom times for the apparel industry, as the newly slim splurge on new clothes and shoes and even underwear, with 80% of semaglutide users expecting to refresh their wardrobe. But every silver lining has its cloud, and slimmers turn out to be really bad online shoppers, unable to guess their new sizes. That’s caused a steep rise in returns at online clothiers, with some reporting that as many as 1 in 8 purchases is returned because it’s the wrong size. And returns are deadly for retailers. It can cost a retailer as much as 80% of the sale price to process a returned item.

The Data Center Glut: Before we even consider whether there’s enough demand for data crunching to power all the new AI data centers being built, let’s pause to look at the quantum state of Cheyenne, Wyoming. This sleep state capital, population 66,000, is home to 10 data centers, with five more under construction and nine more in the planning stage. Cheap land and abundant natural gas are drawing the centers. Local officials say the construction will generate jobs and keep young people in the state. Local residents say the constant construction traffic has ruined their prairie home. But what's got everyone really upset? A “man camp” to house 5,600 workers — quick-build apartments and RVs offering laundry, internet, dining service and pickleball courts. To get all those men into the camp, Meta $META ( ▲ 4.7% ) is starting a “workforce academy”, a $115 million program in four states, offering five weeks of free training in how to swing a hammer or otherwise learn a skilled trade needed to build data centers. Every graduate is guaranteed a job. Meta didn’t say how many workers it will train but said it's already gotten 35,000 applications. Trade groups say the U.S. is short 350,000 construction workers.

Playing the Market: What is going on with the U.S. stock market? Just as SpaceX, Anthropic and OpenAI prepare to go public, consumers are fleeing tech stocks. The tech-heavy Nasdaq-100 $NDX ( ▲ 1.59% ) is down 5.5% in the past five days, while the S&P 500 $SPX ( ▲ 0.81% ) is down 3.3%. Bloomberg’s Mag-7 index is down 7% in the past week. The problem seems to be an oversupply of stocks on the market: the vast number of shares the giga-IPOs will unleash will reverse a 23-year trend that saw the net supply of equity in the U.S. (new shares issued minus equity removed by buybacks and firms going private) shrink consistently. That scarcity helped U.S. shares more than triple in price in the past decade. And it will just get worse in 2027, as the lockup periods on the big AI IPOs expire, Goldman Sachs $GS ( ▲ 2.56% ) says. That could actually kill the tech-led stock rally, as funds sell off Mag-7 and other stocks to buy the IPOs. “Record new issues is one of the classic signs of a bubble,” Richard Bernstein, global head of macro investing at Janus Henderson Investors, told the FT.
Fortune telling: It’s the world’s biggest sport, and it's about to be the world’s biggest gambling event: The soccer world cup that starts this week in the U.S., Canada, and Mexico is expected to attract some $50 billion in wagers, according to an analysis by Australian bank Macquarie. That’s given new urgency to efforts to regulate online gambling and especially the new prediction markets (we’re looking at you, Kalshi $KALSZZX ( ▲ 0.95% ) and PolyMarket $POLYMARKET ( ▲ 3.66% ) ) like the proposal this week from the Commodity Futures Trading Commission to block prediction bets that are not in the public interest or are susceptible to being manipulated. One target: Sports-related bets on whether a player gets injured, or misses a foul shot. The rules would also ban bets on wars, terrorism and assassinations. This comes after a string of cough, cough, possibly-rigged bets on oil prices that may have been linked to White House officials, and the arrest of a U.S. special forces soldier and a Google $GOOGL ( ▼ 0.84% ) employee for insider trading on prediction markets. Kalshi will now require that some users disclose the identity of their employers.

Trumplandia

Numbers game: Life is getting difficult for American consumers as inflation hit 4.2% and gasoline princess rose 7 percent in May. Grocery prices are up, the job market is stagnant, and the giga-IPOs about to hit the markets could upend many people’s retirement plans. Pity the consumer, but save some of your schadenfreude for Kevin Warsh, President Trump’s newly appointed Federal Reserve chair. Warsh came into office sorta kinda promising to lower interest rates (which he’ll now have to raise) and bring down inflation, (which has now soared again, although not quite to its 9% highs during the pandemic). Trump has shrugged it off. “I love the inflation,” he inexplicably told reporters in the Oval Office on Wednesday, promising that as soon as the Iran war ends, oil prices will drop “like a rock.” But Warsh will have a harder time of it. His job is to keep inflation low, employment high, and the dollar in command. But there’s a lot going on. “What we are seeing is three distinct inflation waves — from tariffs, from oil, and now AI capex — layered on top of each other,” Evercore ISI economist Krishna Guha wrote this week. Warsh says we’re looking at the wrong numbers, and he wants to set policy using less volatile price numbers, which he argues “capture the underlying inflation rate,” not a one-off hike in the price of beef or a war in Iran. But he’s only one of 12 votes on the Fed’s Open Market Committee, which sets rates. And while the Fed’s been keeping its benchmark interest rate high, currently at 3.50% to 3.75%, set in December, to keep inflation in check, it hasn’t helped. “Monetary policy is not restraining the economy,” Dallas Fed president Lorie Logan said in a June 3 speech. “I am increasingly concerned that higher interest rates could be necessary later this year to fully restore price stability and appropriately balance both sides of the Fed’s dual mandate.”

Want more Cheddar?

Decoding Investor FOMO About the AI & SpaceX IPOs

Cheddar's Big Business This Week — Thu, 04 Jun 2026 20:30:00 +0000

A historic wave of IPOs is about to hit Wall Street. SpaceX $SPACEX ( ▲ 1.81% ), Anthropic $ANTHROPIC ( ▲ 5.85% ), and OpenAI $OPENAI ( ▲ 3.13% ) , companies once confined to private markets and tech lore, are racing to go public with valuations that could redefine the market. For the average investor watching from the sidelines, the frenzy can feel alien, driven by a complex mix of technological promise and sheer fear of missing out (FOMO).

To cut through the noise, BBTW’s Peter Green spoke with Troy Hooper, cohead of equity capital markets Americas at business intelligence firm MergerMarket.

Our conversation came just before Goldman Sachs’ $GS ( ▲ 2.56% ) rationale for SpaceX’s $1.78 trillion valuation was made public: Goldman sees SpaceX’s AI revenue rising 100x by 2030, to $322 billion by 2030 from $3.2 billion in 2025. SpaceX’s total revenue is expected to reach $474 billion in 2030 from $18.7billion last year.

(Google)

(This interview has been condensed and edited for clarity and brevity )

Peter Green: We're facing massive IPOs from SpaceX, Anthropic, and OpenAI amid economic uncertainty, high inflation, and geopolitical turmoil. How do you explain this disconnect to ordinary investors? What is really going on?

Troy Hooper: There is enormous capital that constantly moves in finance, both in public and private markets. What happens on Main Street does not reflect Wall Street; they are often two completely different universes. These deals are all being driven by AI. AI is a watershed moment in our civilization. Companies are trying to be the leader in that race. You have startups like Anthropic, OpenAI, and SpaceX to some degree trying to win. Then you have giants like Alphabet $GOOGL ( ▼ 0.84% ) Microsoft $MSFT ( ▲ 0.27% ) and Oracle $ORCL ( ▲ 2.66% ) in a race to be the winner. The publicly traded tech giants have the money to burn. Even without this innovation cycle, they constantly do research and development. But this is a moment where the technology has become enticing. They are making these investments to try to lead that market.

Green: Can these companies achieve the revenue to justify trillion-dollar valuations? SpaceX's revenue is a fraction of its target valuation.

Hooper: Those two examples [Tesla $TSLA ( ▲ 3.17% ) and SpaceX] are completely detached from reality. That's the Elon Musk factor. Tesla has always been about the vision; they've sold themselves as a tech company. With SpaceX, you have to buy into the vision Musk is peddling. When you look at the financials and balance sheets, they don't justify the valuations Tesla currently has or that SpaceX aims for in its IPO.

Does that same "vision over financials" logic apply to Anthropic and OpenAI? And how long can shares stay aloft on just an idea?

Anthropic and OpenAI are a little more rooted in reality. The valuations, while certainly high, are not unrealistic like SpaceX and Tesla have been. The opportunity to make money in AI is certainly there. Look at the 'neo-cloud' companies who buy NVIDIA $NVDA ( ▼ 0.66% ) chips and rent them out to hyperscalers like Microsoft $MSFT ( ▲ 0.27% ). Some were created just a year or two ago and are already generating billions in revenue. Even SpaceX, in its S-1 (IPO filing document), revealed a leasing agreement where it rents surplus chips to Anthropic for a vast sum. That is very similar to what these neo-clouds do.

Is there enough cash in the market to absorb all three IPOs?

That's the multi-trillion dollar question. We'll find out. They will have to space them out. You can't have them all at once. Some big institutions will have to sell other stocks to make room. That could have a knock-on effect on the entire Nasdaq or S&P 500. We could see other stocks sell off to make room for these.

Would those sold-off stocks then become bargains?

Maybe. It depends on how much they sell off and whether their business fundamentals remain consistent. That's hard to know.

That sell-off could hurt many individual investors.

It absolutely could. There's a risk there.

Let's game the sequence. SpaceX goes first but is the most volatile. What happens if early investors cash out after lock-up periods and the price falls? How would that affect the subsequent Anthropic and OpenAI IPOs?

It depends on if it's a mild disappointment or a catastrophe. If SpaceX were to flop, it wouldn't necessarily doom the others entirely, but it would apply more pressure. It could force them to delay their listings or reduce their valuation expectations.

We're in a strange macro environment: high interest rates, stagnant housing, an energy crunch. How do these factors affect such massive IPOs?

There are a lot of moving pieces. Interest rates seem high now, but they're historically normal. Once capital becomes more expensive, budgets tighten. Investors will have to consider all these variables.

Is a major driver simply FOMO? More money is now in ETFs than individual stocks [approximately 53% to 47%]. Is there an irrational thirst here?

Absolutely. Some of it's by design. SpaceX is structuring its deal to include about 30% retail. They've convinced NASDAQ to change rules to allow them to join index funds earlier. When you have average people asking if they should buy the SpaceX IPO, that's FOMO.

What about the circularity critique? NVIDIA invests $5 billion in OpenAI, which then buys $5 billion of NVIDIA chips. It looks like revenue, but is there real end-user demand?

I think so. There's also a question of how sustainable the demand is. Uber came out recently and said they weren't getting the expected results from their AI capital expenditures. We might start seeing large businesses pull back on AI spend. That could cascade down and change the forecasts of AI infrastructure companies.

Skeptics like Michael Burry call this a bubble, citing governance, unrealistic P/E ratios, the energy crunch, and a lack of use cases. What's your response?

There are definitely signs we're in a bubble. A lot of the things we've talked about. Even the fact that Alphabet is doing an $80 billion equity raise, its first meaningful one in close to 20 years, is a sign. You issue shares when you can get the most money for them. There are elements of a bubble. But even if we are, it doesn't mean it will pop tomorrow. Sometimes these things keep inflating for years.

If these IPOs are successful, will we see more gazillion-dollar listings?

If they're all successful, it'll go on. But the party usually stops at some point. AI is still in the early days. There's a lot more that needs to play out before we know exactly how powerful and profitable it is.

—Peter S. Green

Big Businesses mentioned this week

$SPACEX ( ▲ 1.81% ) $ANTHROPIC ( ▲ 5.85% ) $OPENAI ( ▲ 3.13% ) $GS ( ▲ 2.56% ) $GOOGL ( ▼ 0.84% ) $MSFT ( ▲ 0.27% ) $ORCL ( ▲ 2.66% ) $TSLA ( ▲ 3.17% ) $NVDA ( ▼ 0.66% ) $BZG23 ( 0.0% ) $BRK.A ( ▼ 0.97% ) $TMHC ( ▼ 0.18% ) $BX ( ▲ 2.98% ) $GME ( ▲ 1.15% ) $PSKY ( ▼ 4.31% ) $IAC ( ▲ 0.38% ) $MGM ( ▼ 0.34% ) $VOO ( ▲ 0.79% ) $UBER ( ▲ 1.02% ) $BTC ( ▲ 1.64% ) $MSTR ( ▲ 0.02% ) $UAA ( ▲ 1.86% ) $JPM ( ▲ 1.47% )

This week, big business!

War Story
The Usual Suspects
Tech Tales
Media Mirror
Trumplandia

War Story

It’s expensive waging war, and not just for buying weapons and fixing the wreckage they leave behind. Moody’s Analytics says the war on Iran has cost the U.S. $100 billion, or about $750 per household, mostly from higher prices for gas and the knock-on effect on food, transportation, shelter and everything else. Until now, says chief economist Mark Zandi, deficit-financed tax cuts have cushioned the blow for middle- and lower-income families. But that ended May 16, by his calculation. “Unless the war ends soon and energy prices come down, they will have little choice but to rein in their spending, weighing further on the already sagging economy,” warned Zandi.
So what’s going on with oil? And why isn’t it yet at $150 a barrel (Brent crude $BZG23 ( 0.0% ) hit a 3-month low of about $86 a barrel on Thursday)? That’s largely because of two things, says economist Douglas Eakin: The drawdown of billions of barrels of oil in storage tanks and floating in tanker ships, and Beijing taking to heart President Trump’s threats early in the year to attack Iran. When the bombs dropped in February, China had been stockpiling Russian crude for months. While some ships are getting out of the Gulf, either by paying off the Iranians or under U.S. guidance, Gulf nations are planning a pipeline to bypass the Strait. A partial deal on letting oil tankers pass through the Strait may happen soon, says business intelligence service Kpler, noting that Iran’s exports have dropped from nearly 2 million barrels a day to just 300,000 since Iran’s blockade and the U.S. blockade of the blockade began in April. Even with a deal, traffic won’t be back to normal until September or October at the earliest, says Kpler. And that could be enough to savage global growth, which for now is riding more on hopes than reality. “The market settled into a delusional expectation that it's all going to end soon, with a stroke of Donald Trump’s pen. All of that trapped oil is going to flow,’” energy analyst Rob McNally of Rapidan Energy Group told the Financial Times. A more likely scenario, says McNally, is that without new oil on the market, prices could jump in July or August close to $200 a barrel, forcing “the most gruesome and unpleasant form of demand curtailment and a broader economic downturn.”

Help make better ads

Did you recently see an ad for Roku Ads Manager in a newsletter? We’re running a short brand lift survey to understand what’s actually breaking through (and what’s not).

It takes about 20 seconds, the questions are super easy, and your feedback directly helps us improve how we show up in the newsletters you read and love.

If you’ve got a few moments, we’d really appreciate your insight.

Take the survey.

END OF ADVERTISEMENT

The Usual Suspects

WWWD: For decades savvy investors have been asking themselves “what would Warren Buffett do? In January, Buffett retired after more than half a century as chairman of Berkshire Hathaway $BRK.A ( ▼ 0.97% ) , leaving the now $1 trillion holding company sitting on a $400 billion pile of cash, and his successor, Greg Abel, in the spotlight. Now Abel has made his first move: He paid $6.8 billion to acquire homebuilder Taylor Morrison $TMHC ( ▼ 0.18% ) , placing a bet on homebuilding will recover despite high interest rates, and spent $10 billion shares in Google $GOOGL ( ▼ 0.84% ) , Berkshire’s first AI play. Since its birth Berkshire has been guided by legendary stock picker Benjamin Graham’s value investing principle: forget FOMO and only buy bargains, and then hold them for a long time. Check back in a few years, then, to see how Abel is doing.

Nervous investors: Investor fears that the $2 trillion market in private credit loans may be in trouble hit home again this week, when Blackstone $BX ( ▲ 2.98% ) , the world’s largest private investment group, said it’s restricting withdrawals from its $45 billion flagship private credit fund, known as Bcred. Redemption requests hit $4.5 billion, or 10% of the fund’s assets, in the second quarter, the FT reported. Many of the business software companies that boomed over the past decade, along with rollups of medical practices have been financed by private credit, and AI, inflation and high interest rates have rattled the private credit business model, imperiling the very survival of many software firms.
GameStop gets Serious: GamesStop $GME ( ▲ 1.15% ) , the one-time meme stock that cost short sellers more than $20 billion in 2021 and 2024, is back. Profits rose in the past quarter to $389.6 million up from $44.8 million a year earlier. And the company has agreed to buy back $2 billion worth of stock to boost its share price. That could eat into the cash available for CEO Ryan Cohen audacious $56 billion bid for eBay, which at this point is presumed by most market-watchers to be DOA. GameStock’s market cap is only $10 billion, and eBay’s board has rejected the offer outright. The firm’s shares are down more than 26% in the past year, though they jumped more than 8% on the profit report.

What’s old is new: Barry Diller, the 84-year old media mogul and takeover artist behind the 1980’s revival of Paramount $PSKY ( ▼ 4.31% ) and more recently Interactive Corp $IAC ( ▲ 0.38% ) and the Daily Beast, says IAC, which is about to be renamed People Inc. (it acquired the former DotDash-Meredith, which owned People magazine) plans to buy the 74% of MGM Resorts $MGM ( ▼ 0.34% ) it doesn’t already own, for more than $13 billion, including debt. Why go from media to entertainment? Alongside People Inc.’s digital media assets, MGM Resorts represents a “perfect hedge in a world that is changing so unpredictively fast,” Diller wrote in an April letter to shareholders. “MGM owns 40% of the Las Vegas Strip—an entertainment nucleus that simply cannot be replicated anywhere in the world,” he added.
Vanguard in the lead: In a sign of the growing power of Exchange Traded Funds (ETFs), low-fee investment manager Vanguard’s S&P 500 ETF, $VOO ( ▲ 0.79% ) , has become the first ETF to hold over $1 trillion in assets, having quadrupled in size since 2022. “As investors chase the AI boom, ETFs have become an ultimate vehicle for US equity exposure,” Todd Rosenbluth, head of research at TMX VettaFi, told the Financial Times.

You gotta pay the fare: Is money getting tight at Uber? This week Uber $UBER ( ▲ 1.02% ) announced the layoff of several hundred people from its HR and recruiting department, and put a cap on employees’ usage of AI, after the company used up its 2026 AI budget before the end of April. Uber shares are down 19% in the past six months. Meanwhile more states are coming after the ride share companies. After Massachusetts last month said ride share drivers could unionize, Colorado is cracking down on safety in Ubers, Lyfts and other ride shares, requiring the companies to ensure riders can opt in to video and audio recording during rides, and mandating semi-annual background checks for drivers.
Bitcoin’s burst bubble: There it goes again: Bitcoin $BTC ( ▲ 3.27% ) , the mercurial cryptocurrency, has lost half its value since last October’s alltime peak over $122,000, falling below $63,000 this week. It seems all that excitement about ETFs being able to buy and hold cryptocurrency did not materialize after all, and some analysts say it could drop to as low as $50,000, as asset managers dump bitcoin to raise cash to buy the next shiny object: the SpaceX IPO. Another reason behind the drop: Strategy $MSTR ( ▲ 0.02% ) , the firm that created the idea of Bitcoin-holding companies as their own asset class, sold Bitcoin for the first time since 2022. While it only sold about $2.5 million worth of tokens, it managed to spook the entire cryptocurrency market, which is known for moving on the tea leaves and entrails of celebrity traders.

Step(h)ing up his game: Steph Curry, arguably basketball’s greatest active player, has signed pro sports’ biggest endorsement deal yet with a Chinese athletic wear maker, inking a 10-year, $400 million contract with Li-Ning, a company founded in 1990 by China’s Olympic gold-winning gymnast Li Ning. Curry ditched struggling UnderArmor $UAA ( ▲ 1.86% ) last year. Chinese brands are facing an increasingly competitive market at home, and Li-Ning says it will open brick and mortar Curry stores in the U.S. Curry said he liked the brand’s shoes. But Li-Ning products were banned from the U.S. in 2022, after the U.S. government said it used forced labor in its factories. Rep. Chris Smith, a New Jersey Republican on the Congressional-Executive Commission on China, said he’ll ask the Department of Homeland Security to examine the deal. "The NBA, its players, and sites like Amazon cannot suggest that they stand for social justice at home while cashing checks from companies tied to the Chinese Communist Party's forced-labor economy,” he told ESPN.

Tech Tales

The Great Big Data Center Wait: A concatenation of problems have formed into a seemingly irresistible force delaying the construction of the massive data centers that AI companies need to train their systems and host the servers that will do all that deep-thinking stuff that AI is supposed to do for us. An analysis by JPMorgan $JPM ( ▲ 1.47% ) found that 60% of the data-center capacity expected to be online in 2027 just won’t be ready. Backlogs in the supply chain, delays in getting building permits, a shortage of electric power to run the chips and of water to cool them, and growing opposition from neighbors are all raising questions that clearly have yet to be priced into AI’s business case. Google parent Alphabet $GOOGL ( ▼ 0.84% ) just sold $10 billion in shares to Berkshire Hathaway $BRK.A ( ▼ 0.97% ) , and plans to raise another $70 billion this year. Its shares fell 3.9% on the news Tuesday, and it lost $340 billion of market cap this week, raising questions about the near-term viability of its AI expansion. Unlike the big money-losing AI startups, Google usually can borrow the money it needs without selling off shares in the company. “The fact that they had to raise equity really makes you wonder about the intensity of the capex needs over the next couple of years,” analyst Michael Nathanson of MoffettNathanson told the Wall Street Journal.
Data centers also have a big problem with community opposition, and one PR firm has a fix: Do a better job of selling yourselves. A survey for PR firm Hahn, which works with utilities around the country, found that only 23% of consumers say they feel comfortable living within a 10-mile radius of a data center, and “anti-data center sentiment is boiling over.” As a company rep said in an email this week, communities “see data centers as faceless, nameless strip miners [that] land, extract resources, exhaust what's around them, and leave, while distant billionaires get richer and locals are left holding higher electricity bills.” One reason for the perception could, of course, be that it’s close to the reality. Good luck fixing both!

(Google)

Media Mirror

Star-crossed: The battle between Politico founder Robert Allbritton and right-wing New York Sun publisher Dov Efune over who gets to call their new Washington news org “The Star” got a time-out this week after a federal judge ruled that Efune, who bought the rights to the name in 2024, could press forward with his “Washington Star,” while Allbritton has to wait for a ruling on whether he can rename his news organization to “The Star.” Allbritton’s father, Joseph, was the last publisher of the defunct DC newspaper “The Washington Star.” Both men are hoping to capitalize on Jeff Bezos’ massive cuts at the Washington Post to capture its readership.
There’s more turmoil at Paramount’s $PSKY ( ▼ 4.31% ) CBS News, where right-wing boss Bari Weiss installed a former graphic designer as head of the venerable (and profitable) “60 Minutes” investigative show, the top rated news show in television, then promptly fired three of its top reporters including Scott Pelley. The show’s ratings are up although the channel’s evening news show has slumped to third place, with barely 4 million viewers under Weiss’ direction, behind NBC with 6.1 million and ABC with 8.2 million. Shares in Paramount are down 21% this year. CBS was forced to deny rumors Joe Rogan was being considered for a “60 Minutes” story on Thursday, but not before the satirists got in on the story on social media.

Trumplandia

Tariff troubles. Remember back in February when the Supreme Court struck down most of the tariffs, saying only Congress had the power to levy taxes? The Trump Administration was supposed to give back about $166 billion to importers who’d been forced to pay the extra duties. We all knew it was unlikely that retailers and consumers would get back anything to compensate for higher costs, but now the Administration says it's not planning to hand back all the money, and its been stalling in the courts. By law, the tariffs must be repaid with interest, so the government is racking up a bigger bill by the day. Unless of course, it never pays. Some 330,000 importers paid tariffs on some 53 million bundles of goods entering the country, and the government now says it might only pay back $127 billion. And even for that cash, it’s insisting that each importer file its own lawsuit. While the Administration says it has paid back $21 billion so far, it’s just announced new tariffs on key trading partners, including a 25% tariff on brazil, and and new tariff on 10% to 12.5% on 59 countries and the European Union, alleging they’ve failed to crack down on the use of forced labor.

Want more Cheddar?

A Quantum leap for tech investment

Cheddar's Big Business This Week — Thu, 28 May 2026 20:30:00 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

(Getty)

Imagine a computer that’s so fast it can discover new drugs to fight cancer or Lou Gehrig’s Disease and bring them to market in a few years, instead of decades. And imagine stocks that can soar five-fold or 10-fold in just a few years, the way chipmakers like Nvidia $NVDA ( ▼ 0.66% ) and Micron Technology $MU ( ▲ 4.52% ) have done. Put those together, and you’ve got quantum computing, a decades-old science that may be on the cusp of an AI-like explosion.

That point was made clear last week, when the Commerce Dept. signed letters of intent to invest some $2 billion in nine U.S. firms with promising quantum computing technologies. The money, already part of Joe Biden’s CHIPS act, has been shaped by the Trump Administration into non-voting equity stakes, rather than loans or grants.

“Quantum computing has significant implications for national defense, advanced materials and biopharmaceutical discovery, financial modeling, and energy systems,” the department said in a press release, adding that “a strong domestic quantum ecosystem is essential for U.S. national security, technological resilience and long-term strategic leadership.”

The government investments follow a wave of private equity and stock market investment in quantum computing firms, and investments from larger firms, like $IBM ( ▼ 2.24% ) , which will get $1 billion from the government and invest another $1 billion of its own in quantum computing.

So: What is quantum computing? Is it really the next big thing, and how do ordinary investors get in on the action?

Quantum computing isn’t just a bigger, faster computer, says Rebecca Krauthamer, the founder and CEO of quantum computing firm QuSecure. “That’s the biggest misconception about a quantum computer,” she said in an interview. Better to think of quantum computing as a method to discover the fastest and most optimal way to get through a maze. Instead of a single mouse trying every turn one after the other, imagine a family of mice, each trying every turn and sharing that information with each other instantaneously to find the shortest route. “You can hold all of these paths through the maze in your memory at once. Then, you’re cooking with quantum.”

The deep science of quantum computing is too complicated to explain here, but the keys to remember are that it is lightning fast, massively complex, and may just be getting close enough for real world applications. That’s where the business case comes in.

Quantum researchers and investors divide those applications into two major groups - offensive and defensive. Offensive is the really complex stuff, like finding new molecules to treat disease, or (less pleasurably) running massive facial recognition data systems that may even take a page from sci-fi writer Philip K. Dick’s Minority Report (remember the 2002 film version with Tom Cruise?) and predict criminal behavior. The defensive stuff may be even more important right now: Ensuring data security. Technologists fear that the first people to get their hands on advanced quantum computing will be able to crack the algorithms that encrypt everything from text messages and emails to bank transactions, medical records and possibly blockchain-encoded crypto currency. That’s why firms like Krauthamer’s are building next-gen security systems with quantum computing.

When will quantum computing take off?

Krauthamer says it may happen as early as 2029, when quantum computers become powerful enough to crack the algorithms that keep data safe. “No longer is the world saying, ‘ah, it’s a future problem’,” said Krauthamer. “All of a sudden, some of the smartest minds in the world are saying it's coming now.’”

That’s why many tech and financial companies are moving to something called PQC, or post-quantum cryptography, an encryption system they hope can’t be outsmarted by quantum computers.

Noel Goddard, CEO of Brooklyn-based Qunnect, which is building the specialized networks and infrastructure that quantum computing will need to take off, says she’s probably two years away from her partners and clients being able to put quantum computers to work, and start building the software to run on them,

Not everyone agrees that “Q-Day,” as some industry people call it, is around the corner.

“You know, I've been pitched in my various roles that quantum computing is two years away for 15 years,” said Afsheen Afshar, founder, CEO and CIO of Pilot Wave Holdings, which buys and invests in firms that can benefit from AI and quantum computing, and who’s a former head of AI for PE fund Cerberus Capital Management. Now, he says, it may finally be getting closer. Current quantum computers can process just a few hundred or thousand qubits, the term used to measure quantum capacity. But Afshar says quantum computers need to be able to process millions, if not billions of qubits before they can tackle big problems like drug discovery. “So the famous expression goes, when there's a gold rush, invest in the people making shovels, right?,” said Afshar. That means firms like GlobalFoundries $GFS ( ▲ 2.56% ) , a New York-based chipmaker that has a promise of a $375-million investment from the government. Then there are the firms tackling technical challenges to quantum computing, whose chips heat up faster than even the Nvidia chips going into AI data centers. They can’t just be cooled with air conditioning, they need liquid nitrogen flowing across the surface of the chips to keep the complex calculations going.

How can investors grab a piece of the action?

Even as some of the firms that got CHIPS money last week saw their shares jump as much as 50%, it’s still early days in Quantum computing and therefore, in quantum investing, says Andrew Rocco, a tech analyst at Zacks Investment Research. He says established, listed companies are the best ones to invest in, including CHIPs recipients IBM and GlobalFoundries. “If you want a piece of potentially what quantum could bring, but also you don't want to throw darts, I would say that IBM would be your best path,” Rocco said in an interview. He likes GlobalFoundries because they’re building the hardware that every quantum company will need, no matter whose technology wins. Then, he says there are “high octane, pure plays,” that also got CHIPs money last week, like D-Wave Quantum $QBTS ( ▲ 2.52% ) , Rigetti Computing $RGTI ( ▲ 0.41% ) , and Infleqtion $INFQ ( ▲ 2.09% ) . Some Exchange Traded Funds offer investors access to a more diversified basket of quantum stocks, like the Defiance Quantum ETF $QTUM ( ▲ 2.03% ) , the Wisdom Tree Quantum Computing Fund $WQTM ( ▲ 1.68% ) .

(Google)

“They have very, very little in revenue,” said Rocco, of the companies mentioned. “I would think of these as like early stage biotech,” he said, “if you're looking for something that's backed by fundamentals, these certainly aren't just yet.” But he said, “the good news is now that they have this funding, you don't have to worry about them going bankrupt. They have that government backstop in place to do research for the next few years. And the upside is asymmetric.”

With the right bet, any investor’s portfolio could take a quantum leap. #NotFinancialAdvice

—Peter S. Green

Big Businesses mentioned this week

$NVDA ( ▼ 0.66% ) , $MU ( ▲ 4.52% ) , $GFS ( ▲ 2.56% ) , $QBTS ( ▲ 2.52% ) , $RGTI ( ▲ 0.41% ) , $INFQ ( ▲ 2.09% ) , $UMGP ( 0.0% ) , $DIS ( ▼ 0.55% ) , $SPOT ( ▲ 0.14% ) , $BP ( ▼ 1.68% ) , $CRH ( ▲ 1.37% ) , $LULU ( ▲ 2.54% ) , $NKE ( ▼ 0.26% ) , $UBER ( ▲ 1.02% ) , $DASH ( ▲ 1.58% ) , $F ( ▲ 0.82% ) , $TSLA ( ▲ 3.17% ) , $JPM ( ▲ 1.47% ) , $C ( ▲ 1.59% ) , $ANTHROPIC ( 0.0% ) , $INTU ( ▲ 0.92% ) , $OPENAI ( 0.0% ) , $GRPN ( ▲ 4.23% ) , $SSNLF ( ▲ 116.8% ) , $SBUX ( ▲ 2.45% ) , $CMG ( ▲ 3.5% ) , $SPXL ( ▲ 2.49% ) , $DJIA ( ▲ 0.14% ) , $NDX ( 0.0% ) , $SCHW ( ▲ 0.21% ), $GOOGL ( ▼ 0.84% )

This week, big business!

War Story
The Usual Suspects
Trumplandia
Want more Cheddar?

War Story

(Google)

Talks go on, oil goes down, missiles fly, oil goes up: With no sign of any strait talk on Hormuz, traders appear to be pricing in both declining economic activity and the eventual release of the 1,500 or so oil tankers bottled up in the Persian/Arabian Gulf. On Thursday, benchmark Brent crude was trading at about $96 a barrel and West Texas Intermediate at around $91, far below their wartime peaks of $126 and $119 each. Meanwhile, U.S. stocks marked their eighth consecutive week of gains. But getting all that oil out will not be easy. Before the war, about 130 ships passed through the Strait of Hormuz each day. First up is clearing the mines that Iran reportedly laid in the strait. Then there’s prioritizing which ships move first, and finally, there’s the messy business of keeping the ships moving through the 21-mile-wide strait without banging into each other, or running aground. Supertankers can take over a mile just to make a 90-degree turn. It’s why turning them is the basis of the world’s most boring management metaphor. Before that, stranded ships need to be resupplied, refueled and their massive engines restarted, meaning at least two months before all those ships start moving. None of that has helped U.S. consumers, as inflation hits three-year highs.

END OF ADVERTISEMENT

The Usual Suspects

The Lady ain’t no Tramp: Universal Music Group $UMGP ( 0.0% ) , the long-time home of artists including Lady Gaga, Taylor Swift and The Beatles, likely won’t be sold to voluble Wall Street investor Bill Ackman and his Pershing Square Capital, after Universal’s French shareholder Bollore Group said Ackman’s $65 billion offer undervalued the world’s largest music company. “I don’t think it would be positive for the company and I encourage UMG management to reject that offer,” Bollore told shareholders at the company’s annual meeting on Wednesday. The Bollore family holds 40% of the voting rights (and about 18.5% of the shares) in UMG. Ackman needs a two-thirds vote to take control. Ackman has long pushed to get control of UMG and move its listing from Amsterdam to New York to “unlock value.” He also pledged to appoint former Disney $DIS ( ▼ 0.55% ) president Michael Ovitz as chair. In May UMG said it would sell its 3.1% stake in Spotify $SPOT ( ▲ 0.14% ) and use the cash to buy back its own shares. UMG shares are down 30% in the past year.
BP’s corporate Turm-oil: Just because you’re the boss, doesn't mean you can be bossy. London-based oil giant BP $BP ( ▼ 1.68% ) (once also known as “British Petroleum” before a rebrand during the “renewable energy years” as “Beyond Petroleum” and now that we’re apparently over all that, simply, “BP,” once again…) ousted chairman Albert Manifold this week after whistleblowers complained that he was bullying underlings and news reports said he’d been trying to run the company, normally the job of its CEO, Meg O’Neill. Manifold, who previously ran one of the world’s largest building supply companies, Dublin-based CRH $CRH ( ▲ 1.37% ) , had no oil-and-gas experience. He’s the third chairman to depart in the past three years, and O’Neill is the company’s third CEO in the same period. BP has been trying to reverse plans to be a clean energy company, and re-embrace its fossil-fuel-burning roots. Its share price rose more than 20% under Manifold’s tenure, but has fallen 9% in the last 5 days. Manifold has denied the allegations. “I dispute entirely the characterization of my conduct, and I will not allow a false narrative to go unchallenged,” he said in a Bloomberg interview. BP, meanwhile, stands by the claims and quickly scrubbed all mention of him from its website.
Lululemon founder takes a deep breath: Yogawear pioneer Lululemon $LULU ( ▲ 2.54% ) has reached a state of inner peace, at last, with founder Chip Wilson, who’s been haranguing the company for years, saying it’s lost its yoga mojo, and even launching a proxy fight to change the firm’s board. Under the new peace deal, Wilson (who owns 8.7% of the company’s stock) will shut up about the company for 18 months. In exchange, he can name two directors, and the two sides will agree on a third director with marketing chops. Former top Nike $NKE ( ▼ 0.26% ) exec Heidi O’Neill becomes CEO this fall, as Lululemon’s U.S. sales are faltering and the company’s share price has gone downward, dog, by 60% in the past year.
Mars, Schmars. We’re going to the Moon, baby! Forget about building a manned space station on mars, NASA’s just awarded a bunch of contracts to build a $20 billion Moon base, and the first of those are going to Jeff Bezos’ Blue Origin, which gets $468 million for two un-crewed landers. Astrolab and Lunar Outpost will each get $220 million to build unmanned lunar rovers. SpaceX did not receive any contracts in this round.
Uber Essen: What could be wurst? San Francisco-based Uber $UBER ( ▲ 1.02% ) has boosted its stake in German food delivery app Delivery Hero to nearly 37% with the purchase of a 14.6% stake held by Hong Kong investment manager Aspex Management. The move sets up a potential takeover move by Uber that would value the German company at about €12 billion. Delivery hero’s Middle East operation, Talabat (which means “orders”), has been eyed by DoorDash $DASH ( ▲ 1.58% ) . Delivery Hero’s shares are up nearly 150% since mid April on takeover rumors. Uber is down 20% in the past year, and DoorDash is down 23% in the past year. In Massachusetts, drivers for Uber $UBER ( ▲ 1.02% ) and Lyft $LYFT ( ▲ 3.76% ) have unionized and will be represented by the App Drivers Union, following a 2024 ballot initiative. Ride-share drivers in California and Illinois hope to unionize soon.
There’s a Ford Battery in Your Future: Ford $F ( ▲ 0.82% ) stock is up by a third in the past two weeks, reaching heights it last saw four years ago, when shares broke $16. And it's not because of newly relaxed energy efficiency rules or a sudden thirst by suburban dads for oversized pickup trucks. Nope, after canceling ambitious EV plans, Ford cleverly spun out its EV group into an energy storage unit called “Ford Energy.” Making those batteries available for AI data centers, utilities and industrial customers now has Ford competing with Tesla $TSLA ( ▲ 3.17% ) .
Star Wars 12: The Return of the Merchandising. Disney’s $DIS ( ▼ 0.55% ) Star Wars series is back with its unnervingly cute and totally merchandisable 14-inch-high Baby Yoda character, Grogu. The big-eared, gibberish-speaking creature led the film to a $145 million box office debut last weekend, triple its nearest competitor. But the real good news was a ComScore exit poll showing kids loved the movie, even as critics panned it, meaning there are gonna be a lot of Grogus filling Christmas stockings come December. Disney shares are up nearly 13% since a late March low, but still down nearly 8% in the past year. Investors in the stock over the last 20 years, in fact, have been on a rollercoaster as exciting as any of those available at its theme parks:

(Google)

WWJB: What Will Jamie Buy? JPMorgan Chase $JPM ( ▲ 1.47% ) CEO Jamie Dimon says he’s prepared to spend $20 billion buying something. But what? “There might be, in the next couple years, a chance to put $10 or $20 billion to work buying something,” Dimon said at a conference this week. But anything he buys would have to fit into JPMorgan’s existing network, he said, before slamming his competitors for trying to merge their way out of poor performance, saying M&A is not a growth strategy. Then he poured cold water on his own idea. “The first thing they do when they’re not doing well in organic growth is they start to bulls--t about [M&A],” Dimon said of other corporate execs. “I don’t want to hear about M&A ... What are you doing to grow your business — sales, branches, tech, profits, products, services?” Meanwhile JPM has mainly (checks notes) bought distressed banks to grow, including Bear Stearns after the 2008 crisis and First Republic after it over-leveraged to Silicon Valley in 2023. Dimon got burned paying $175 million for college aid startup Frank in 2021, which turned out to be a fraud. The cash has been freed up as reserve requirements have been eased under the Trump Administration. JPM is outperforming the stock market over the last five years but it’s being caught up by rival Citigroup. $C ( ▲ 1.59% )

(Google)

Tech time

Div-AI-ne Intervention? Pope Leo will not abide by the things that are going on with AI. In a 42,000-word letter, the Chicago-born head of the Catholic Church warned that new rules and regulation are needed to cope with what he called “the distorting effects of technological power,” to ensure that AI benefits people, not the “transnational companies” that put profit ahead of humanity, and may put most of humanity out of work. The Pope presented his letter alongside Anthropic $ANTHROPIC ( ▲ 5.85% ) co-founder Christopher Olah, who’s not a Catholic, but said the AI community needs the pope’s moral guidance. That’s not how the rest of Silicon Valley responded, though. The New York Times collected the musings of some senior AI people in the Bay Area who see the Pope as an interloper: “People are matter-of-factly saying that they are looking to build a machine God,” said Rayan Krishnan, CEO of a firm that tracks AI tools. “They are not saying that ironically or in jest. They are saying it as a matter of fact.” Jeremy Nixon, CEO of the Infinity AI Institute, took a page from (Catholic) Vice President JD Vance’s book and said the Pope simply doesn’t understand AI. “Practically speaking, it will achieve the outcomes that many religions claim their deities would be able to achieve,” he said.
Still, AI continues its relentless march: A Paris-based nuclear power developer called Newcleo says it plans to go public in the U.S., betting that its plans for lead-cooled reactors (they are supposedly less accident prone than the pressurized water reactors at Fukushima…let’s hope so…) will be in demand to power the AI boom. Turbo layoffs are coming as Intuit $INTU ( ▲ 0.92% ) announced it will fire about 3,100 people, 17% of its workforce, and shift to AI to manage projects. The news comes as OpenAI $OPENAI ( ▲ 3.13% ) says it’s adding personal finance options to ChatGPT, with support from Intuit, which owns TurboTax and Credit Karma. Groupon $GRPN ( ▲ 4.23% ) also said it’s cutting 400 workers, about 25% of its workforce, to rebuild as an “AI-first” company. Over in South Korea, Samsung $SSNLF ( ▲ 116.8% ) employees used their strong unions to wrangle a very lucrative concession from management: 78,000 workers in the company’s chip business will share 10.5% of Samsung’s operating profits, giving them an average bonus of about $400,000 each. Shares in Samsung rose 7% on the news. They’re up 427% in the last year.
(Google)
Suddenly you’re talking real numbers: Big tech companies are finding that their quest to use agentic AI is eating up so many tokens that it may simply be cheaper to hire humans. "For my team, the cost of compute is far beyond the costs of the employees," Bryan Catanzaro, vice president of applied deep learning at Nvidia $NVDA ( ▼ 0.66% ) , told Axios. Add to that employees using AI tokens simply to show they are doing something with all that free time Claude has given them since it’s taken over their daily work, and maybe humans will triumph, after all? Claw creator Peter Steinberger said he spent $1.3 million in a month on OpenAI tokens.

Trumplandia

Interest rates ain’t going down any time soon. That’s the consensus view in the world of economists and bond traders. As Moody’s Analytics chief economist Mark Zandi said in a post this week, yields on T-bills keep climbing. “Treasury yields have jumped in big part due to the Iran War and the resulting increase in inflation expectations, but also to the ballooning federal budget deficit and surge in Treasury securities issuance necessary to finance it,” Zandi wrote. The Treasury issued a record $3 trillion in debt in March, and that’s growing by a record 10% a year, or 10% of GDP a month. This year, for the first time, the federal debt exceeded the country’s annual economic activity (aka GDP). The problem, as Zandi notes, is who’s gonna buy all those bonds, unless the Treasury offers even higher interest rates. New Fed chair Kevin Warsh says he doesn’t want to buy more Treasury debt, and neither do traditional purchasers like China and Japan. “That leaves highly leveraged, capricious hedge funds as the dominant new buyers,” said Zandi. And that means rates are likely to move up even further.

Want more Cheddar?

What Are The Hidden Risks of Giant IPOs?

Cheddar's Big Business This Week — Thu, 21 May 2026 20:30:00 +0000

SpaceX $SPACEX ( ▲ 1.81% ) , Anthropic $ANTHRP ( 0.0% ) and OpenAI $OPENAI ( ▲ 3.13% ) are all poised for or filing for IPOs over the next few months, and under new quick-entry rules, they will swiftly join the Nasdaq-100 stock index. Passive funds, the ones that invest in the indexes that are now dominated by very large cap stocks like the MAG-7, no longer outperform the market, they are the market, accounting for well over 50% of all investments in U.S. stocks:

(Google)

Passive funds have to buy every stock in the index, in proportion to its weight in the index. So, what happens when Space X, with its $1.75 trillion valuation, and the forthcoming IPOs of AI giants OpenAI and Anthropic, all hit the market in the next few months?

BBTW columnist Peter Green talked with Cam Harvey, a Duke University finance professor, a partner in investment manager Research Affiliates, and the author of a recent study entitled “Passive Aggressive: The Risks of Passive Investing Dominance.”

Harvey warns that the rush of giant private companies to public markets will leave ordinary investors buying at premium prices, reserving earlier gains for wealthy “qualified investors.” Harvey says the rise of passive investing and index-fund demand may distort price discovery and increase systemic risk.

Your recent work on what you call "passive aggressive investing" feels especially timely with the SpaceX, OpenAI, and Anthropic IPOs on the horizon. What's the core problem you see with mega-IPOs?

The SpaceX IPO is looking to raise at least $75 billion, and the overall capitalization of SpaceX will be $1.75 trillion, which means what is going to the market is about 4% of the value. Passive investors, such as index funds, need to include this in their portfolio. So just given that expectation—and the supply and demand constraint—there's going to be pressure on the price to go up. So the retail investors who can buy this will likely be paying a premium, just because the passive investors have to buy. That means the expected return will likely be low. But that's certainly not the experience of qualified investors, who were able to buy this stock many years ago and have benefited from the appreciation already.

So wealthy and institutional investors win twice — first by getting in early, then by selling into demand created by index funds?

This is a situation where the definition of qualified investors just creates inequality. It tilts the playing field towards the big investors, which include hedge funds. It just doesn't seem fair to me. The 1933 Securities Act was designed to protect investors, given what happened in the late 1920s, but at this point, I think we need to revisit this to allow for a different criteria to be a qualified investor. For example, some sort of education rather than just money. I'm concerned about this benefiting large investors that have the resources to get in early. But the average investor will be faced with buying the stock, if they choose to do so, at a premium price.

More giant tech IPOs are coming — Anthropic, OpenAI. Nasdaq recently changed its rules to fast-track these into indexes. Does that make the problem worse?

That's exactly right. The quick entry rule has got this downside. So it's not just a quick entry. There is an exemption on the amount of float that's available. With SpaceX, it's only 4%. That's going to cause a problem because the index funds don't care that the Price/Earnings ratio of the company (its valuation relative to the revenue it’s bringing in) is 70 or 170. They just have to buy. It's not a decision, it's not discretionary. That creates competition for the shares driving up the price.

You write about what you call "the danger of synchrony." Can you explain what that means for ordinary investors?

53% of all investment is passive. And again, the passive investor doesn't care about any fund limits. It's completely irrelevant. Passive growth makes stocks move together, because when flows come in, they buy everything. And when flows go out, they sell everything. So what this does is create the possibility of increased systemic risk. When there's a breakdown, people are selling, then the index funds sell everything.

So that means volatility increases. So when correlations increase, think of — you've got a portfolio of stocks, and some have low correlations, some high correlations. If something happens to one stock, well, there's diversification, because there's other stocks that might do well, if one stock does poorly. But if everything's moving in the same direction, then there's no diversification.

If passive investing creates these problems, why can't active fund managers beat index ETFs?

Most active managers are unskilled. You can look at active mutual funds and see they don't outperform on average. But that doesn't mean you shouldn't invest actively. It just means you need to be careful what you buy.

How do you find an active manager worth trusting?

What you need to do is to understand what the active manager is actually doing. Does it make sense? And you can look at the track record, which is also informative. But the investment logic, I think, is the most important.

What does the math look like for someone buying SpaceX shares at the IPO price? The numbers SpaceX reported are a bit scary: A $4.9 billion net loss on $18.67 billion in consolidated revenue last year, one-fifth Tesla’s $TSLA revenue, and the AI unit generated only $818 million in the first quarter.

If you're buying at 70 times earnings, that's like double what Nvidia is. So you're buying something that's just twice as expensive as Nvidia. So what are the prospective returns for something like that? If you look at buying at a price-earnings ratio of 70, on average, that would suggest very low expected returns.

But those returns were great for the early investors. You've called for rethinking who qualifies as an accredited or “qualified” investor. The original intent was protecting less-informed people from risky investments — but is that logic still sound?

Even the retail investor can buy risky things like Bitcoin with leverage. That doesn't make any sense. Being “qualified” needs to be more about information. A high school teacher with a master's or even a PhD in biology has got an interest in biotech, but can't buy a biotech private equity stock because they don't make enough money. That makes no sense to me. We need to revisit that to get more retail investors qualified.

What would a better system look like?

Look at what they do in the European Union. Being “qualified” can be about money, but it can also be about education: Either your educational level, or you take some sort of test on the basis of finance. I think that'd be a great thing to encourage people to actually learn about this stuff. And then they would have access to the outsized returns now reserved for the wealthy.

—Peter S. Green

(This interview has been condensed and edited for length and clarity)

Big Businesses mentioned this week

$TSLA ( ▲ 3.17% ) , $DE ( ▼ 0.64% ) , $AAPL ( ▲ 0.9% ) , $CAT ( ▼ 1.02% ) , $SBUX ( ▲ 2.45% ) , $BA ( ▼ 0.82% ) , $STLA ( ▼ 1.3% ) , $VLKAY ( ▼ 0.99% ) , $AMZN ( ▲ 1.4% ) , $RIVN ( ▲ 8.76% ) , $GOOGL ( ▼ 0.84% ) , $OPENAI ( ▲ 3.13% ) I, $ANTHRP ( 0.0% ) , $BX ( ▲ 2.98% ) , $NEE ( ▼ 0.39% ) , $D ( ▼ 0.59% ) , $IRDM ( ▲ 0.26% ) , $META ( ▲ 4.7% ) , $IBM ( ▼ 2.24% ) , $GFS ( ▲ 2.56% ) , $GS ( ▲ 2.56% ) , $MS ( ▲ 1.86% ) , $SPCX ( ▲ 2.6% ) , $HD ( ▲ 0.75% )

This week, big business!

The usual suspects
Tech times
Trumplandia

The usual suspects

Whose wood chipper is it anyway? First came the farmers, now it’s the landscapers, who are suing John Deere $DE ( ▼ 0.64% ) , the agricultural equipment maker, for effectively fixing the price of repairs and maintenance on Deere’s big machines. By allowing only authorized repair firms access to the software tools needed to keep modern landscaping (and farming) machinery up and running, landscapers say Deere is forcing them to use franchised dealers who can set above market prices for parts and repairs. Farmers won a similar battle settlement fund. Landscapers now want the same thing. Right-to-repair activists have been battling everyone from Apple $AAPL ( ▲ 0.9% ) to toastermakers over the years, and have secured consumer protection bills in many states. But in big equipment, the right to repair hits at the very profit center of giants like Deere and Caterpilla $CAT ( ▼ 1.02% ) , whose profits come largely from spare parts. Shares in Deere were down 6% this week.

(Giphy.com)

Star(saving)bucks: The Seattle-based coffee giant says it’s laying off 300 corporate staffers, as part of CEO Brian Niccol’s push to recaffeinate the company. So far Niccol’s plan to focus on customers and the baristas who serve them seems to be paying off. Sales at U.S. stores opened for a year or more were up 7.1% in the first quarter from a year earlier, though last year’s sales were particularly weak. Niccol’s plan to remake the company by paying baristas more and renovating the often-bleak Starbucks $SBUX ( ▲ 2.45% ) shops is cutting into the company’s operating profits. Shares in Starbucks are up 25% this year.
Boeing’s sad Beijing Bag: As Boeing $BA ( ▼ 0.82% ) CEO Kelly Ortberg flew to China with President Trump last week, Wall Street investors and aviation watchers expected him to come back with an order for as many as 500 short-medium haul 757 Max 8s, and up to 100 787 Dreamliner and 777X long-haul planes. At an average sale price of $117 million to $135 million for the 737s, and $206 million to $338 million for the dreamliner, the whole order could have been worth up to $100 billion, cementing Beoing’s financial future. Instead, Ortberg came back with a deal for 200 planes. No small feat, but nothing like the permanent lifeline the original plan would have secured. Boeing shares fell as much as 10% after the smaller order was announced.
Carvana’s (glass)-towering ambitions: Carvana $CVNA ( ▲ 1.15% ) , the online used-car giant, is quietly staking out a large footprint as a new-car dealer for the brands of Chrysler parent Stellantis $STLA ( ▼ 1.3% ) . Carvana offers new-car buyers the same haggle-free experience they offer to those buying used cars from their glass tower car vending machines. To get there, Carvana has bought a half-dozen Stellantis dealerships. Small beans so far, but now as Volkswagen $VLKAY ( ▼ 0.99% ) and Amazon $AMZN ( ▲ 1.4% ) join Tesla $TSLA ( ▲ 3.17% ) and Rivian $RIVN ( ▲ 8.76% ) selling new cars directly to customers, it could be a growing market. Stellantis on Thursday announced nine new models selling for under $40,000 as part of a $70-billion plan to revitalize the firm. Stellantis lost $25 billion last year, and has struggled to integrate its French, Italian and U.S. carmakers.

Making Hydraulics Obsolete

Every excavator, forklift, and crane on the planet runs on hydraulic fluid. It leaks. It fails. It burns through 60% of the energy you put into it. That's been true for a hundred years.

RISE Robotics built Beltdraulics™ to fix all of that. Their patented actuator swaps out hydraulic cylinders for a fluid-free electric system that runs up to 3X faster and cuts operating costs by 50%. No oil. Full digital control. Built-in sensors that hydraulic systems can't touch.

The U.S. military is already a customer. MIT-founded. $9.3M in revenue. 20+ patents protecting the core technology. Dylan Jovine of ‘Behind the Markets’ said RISE “has all the little ingredients to be one of those really big winners.” His readers have been backing it ever since.

You can invest today through the community round on Wefunder.

The Ingredients of a Blockbuster Winner

END OF ADVERTISEMENT

Tech times

Google’s AI Dominance: Fresh off a massive AI integration that’s introduced a new search box for the first time in a quarter-century, Google $GOOGL ( ▼ 0.84% ) is taking a hardshot at OpenAI $OPENAI ( ▲ 3.13% ) and Anthropic $ANTHRP ( 0.0% ) to become the world leader in consumer-facing AI. A slew of new AI functions (waaaay too many to talk about here, but none were used to write this newsletter, obviously…) unveiled at its annual developer conference are positioning Google to stay profitable (its 2025 operating margin was 31.6%). It’s also joined forces with PE group Blackstone $BX ( ▲ 2.98% ) in a joint venture to provide cloud services to AI startups, using $5 billion of Blackstone’s cash to buy chips and other tech from Google.
The Power Hour: Big data requires big energy, and the latest energy consolidation play is a big one: Florida-based NextEra Energy $NEE ( ▼ 0.39% ) has agreed to buy Virginia-based Dominion Energy $D ( ▼ 0.59% ) , for $67 billion in an all-stock deal that would create an East Coast giant to help power the AI boom. Dominion delivers power to 450-plus data centers, more than any other firm in the world, but its share price is down 13% over the past five years. That’s partly because of aging deals that sold power at pre-boom prices, and massive upfront investments in new powerlines and infrastructure. The combined company will have an enterprise value of $420 billion, giving it a lot more capital, just as new Virginia rules will force data centers into long-term contracts. NextEra’s offer was 23% above Dominion’s share price.
Remember Iridium? Three decades on, the original satellite phone company is still there, with a fleet of low-earth orbit satellites $IRDM ( ▲ 0.26% ) . Now, it’s spending $368 million to buy the rest of a joint venture that tracks ships and airplanes. But the big play is a satellite data service that could compete with Elon Musk’s Starlink. And if it can’t, the company has some pretty valuable licenses to a sweet part of the radio spectrum that could be a cash cow. Shares in Iridium were up 154% this year.

(Iridium)

Meta Layoffs. Another 10% of Facebook parent Meta’s $META ( ▲ 4.7% ) workforce will soon be pounding the pavement, with 8,000 layoffs (and no plans to fill 6,000 empty roles), as the company increases spending on AI, now set to hit $145 billion this year. CFO Susan Li said on an earnings call that execs “don’t really know what the optimal size of the company will be in the future.” That uncertainty and the vast AI spend have hammered Meta’s share price, with shares falling as much as 29% from January to March, before rebounding, but still down 8.2% this year, while the tech-heavy Nasdaq 100 index is up 15% this year. Layoffs are hammering the tech world, with at least 114,000 tech workers laid off at 148 companies this year, according to the optimistically named site, Layoffs.fyi
A Quantum of Handouts? In an effort to spur U.S. tech development, the Trump Administration is handing out $2 billion to nine tech forms racing to develop quantum computing. IBM $IBM ( ▼ 2.24% ) gets $1 billion, and all of the firms will hand the government a slice of their equity in exchange for the cash. Awardees include Global Foundries $GFS ( ▲ 2.56% ) , and a host of smaller firms, including closely held PsiQuantum, whose investors include Donald Trump, Jr.’s 1789 Capital. Their shares all shot up Thursday morning on news of the awards:

(Google)

OpenAI-and-Shut Case: It took an Oakland, California, jury less than two hours to throw out Elon Musk’s claim that arch-rival Sam Altman had stolen OpenAI $OPENAI ( ▲ 3.13% ) when he transformed it from a charity to a for-profit company. The jury ruled Musk’s lawsuit was filed too late, and Judge Yvonne Gonzalez Rogers dismissed Musk’s claims. The three-week trial riveted Silicon Valley with revelations that Musk romantic partner Shivon Zilis was consulting with him while serving on the board of OpenAI, and that Musk had in fact supported OpenAI’s shift to a for-profit model as far back as 2017. One memo from co-founder Ilya Sutskever described Altman as a liar who pitted executives against one another. OpenAI lawyers also contended that Musk brought the suit to protect his own AI firm xAI, that is lagging in the race for AI dominance. Musk did not take it well on Twitter, in a since-deleted post on X, calling Judge Gonzalez Rogers “a terrible activist,” adding, "She just handed out a free license to loot charities if you can keep the looting quiet for a few years!" The verdict paves the way for OpenAi to proceed with filing for an IPO, which CNBC says is being prepared with Goldman Sachs $GS ( ▲ 2.56% ) and Morgan Stanley $MS ( ▲ 1.86% ) , and could come as soon as this weekend, competing with Musk’s own IPO for SpaceX $SPACEX ( ▲ 1.81% ) , which includes xAI.

Trumplandia

Home Economics: The bombing campaign against Iran, and the knock-on effects on the global economy are starting to hurt the president’s economic standing with voters at home. A new poll out this week shows rising disapproval of the president’s approach to handling the economy, even among Republicans. Although 1% of Democrats apparently still think he’s doing a good job, apparently:
(Google)
New Fed chair Kevin Warsh will find it hard to lower rates thai year, as inflation hit an annualized 3.8% last month, nearly double the target 2% rate. “Steady labor market conditions alongside rising inflation risks increase the odds of a rate hike as the next policy move,” EY-Parthenon chief economist Gregory Daco wrote in a note on Wednesday. Housing problems are also hitting home: Rising mortgage rates, now at 6.63% for a conforming 30-year loan, sent mortgage applications falling 2.3% last week, while existing home sales rose only 0.2% in April. Mortgage rates had fallen below 6% just before the war with iran. Even Home Depot $HD ( ▲ 0.75% ) felt the pinch, with first-quarter profit falling to $3.3 billion from $3.45 billion a year ago. Its shares are down 26% since a peak last September. “When we talk to our customers, they do tell us that they have concerns over uncertainty and housing affordability,” CFO Richard McPhail told the Wall Street Journal. As if to illustrate the uncertainty, the number of homes facing foreclosure jumped 26% in march from a year earlier. Meanwhile, Treasury ills, the debt the U.S. government issues to finance the programs it provides, is getting more expensive to service, as investors see it as growing riskier. With the government now promising interest of 4.6% on 10-year bonds and 5.12% on 30-year bonds Thursday, the highest they’ve been in nearly 18 months. Democrats are leaning heavily on a quote Trump gave to news media last week saying “I don’t think about Americans’ financial situation” when negotiating with Iran — although the second half of that quote is a bit more balanced because the president said he’s focused on the elimination of the country’s nuclear capabilities.

Want more Cheddar?

'They're Getting Their Money Back': A Trade Lawyer on the Tariff Collapse

Cheddar's Big Business This Week — Thu, 14 May 2026 20:30:00 +0000

In February, the U.S. Supreme Court ruled that the administration’s emergency tariffs were illegal, and it ordered the government to return the $165 billion it had collected so far. Last week, the U.S. Court of International Trade ruled that a set of replacement tariffs installed after the first set were overturned were also invalid. Liz Levinson co-leads the international trade practice at law firm Fox Rothschild in Washington. She sued the federal government on behalf of 100 companies over the IEEPA tariffs. BBTW columnist Peter Green spoke with Levinson about refunds, court rulings, and what's actually left of the tariff slate.

The courts have now struck down the two main pillars of the tariff program. Let's start with the IEEPA duties — what's happening on the ground right now?

On the IEEPA duties, the Customs Service has started refunding the money. There are actual live people who have received money starting on May 11th. The process is that they've created a mechanism for gaining the refunds that's broken up into different phases. We're now in Phase 1, which covers all shipments that have not been liquidated or that were liquidated within the last 80 days. The burden is on the importer to upload a spreadsheet — a spreadsheet of all their entries that fit those criteria, i.e., they've either not been liquidated or they were liquidated within the last 80 days.

What does "liquidated" mean in this context? It's not a term most people know.

It’s an important term for your readers to understand because “liquidated”, a lot of people think they import something into the United States, Customs clears it, they maybe sell it downstream, it enters commerce. But from Customs' point of view, it is not final. They can still come back and ask for more duties, and they have 314 days to do that. And that process of finalization is called “liquidation.”

So even after the goods have changed hands multiple times — bought, sold, consumed — the importer is still technically on the hook?

Yep. The importer of record — Customs can come back and say you owe more duties because they maybe disagree with the classification you brought it in under, or some other reason. Maybe there's anti-dumping duties or other kinds of duties that you didn't pay. Nothing is final until the shipment is liquidated.

And if something was already liquidated before you can file a Phase 1 claim?

If it was liquidated, you will get something back, but you may be part of Phase 2. This is Phase 1 — liquidated within 80 days. So if something was liquidated 90 days ago, you can't put in now in Phase 1, but you will get your refund eventually when they come up with Phase 2. If something has been liquidated and it's beyond that 80 days, you have to make sure you don't hit 180 days, because if it's more than 80 days but less than 180 days, you have to file what's called a protest. But basically, you're either in Phase 1 or you're in Phase 2.

So the refund goes to the importer. What about the retailers, the small businesses, the consumers who absorbed those higher prices?

It's just the importer, not the retailer. There's been a number of lawsuits. People suing the importer. Costco $COST ( ▼ 4.21% ) has been sued. I think Walmart $WMT ( ▼ 0.79% ) has been sued. FedEx $FDX ( ▲ 0.35% ) and DHL have been sued. If you had the foresight to make a contract with your provider saying, “if you get this money back, you've got to refund me,” but otherwise [the importer] has no legal obligation [to pay you back].

Why did the courts strike down the IEEPA tariffs in the first place?

They found them unconstitutional. The Constitution, Clause 8 of Section 1 of the Constitution, gives Congress the authority to levy taxes, and that includes import duties. The Court found that the president doing it was illegal. Unconstitutional. They found that you could not levy taxes or import duties under any circumstances under IEEPA. IEEPA does not use the word taxes or customs duties anywhere in the provision. That's meant for other purposes.

And then the administration tried a different legal basis — Section 122 — to impose a blanket 10% tariff on imports. What happened there?

The Court of International Trade in New York ruled that that is illegal. Section 122 allows the president to levy taxes when it's necessary to correct a balance of payment problem with another country. And the administration did not find any of these balance of payment inequities with any other country. And that was a prerequisite. The administration just didn’t want to do the homework.

What's actually left standing, then? What tariffs are still in effect?

There's the normal tariffs, which we refer to as the most favored nation tariffs. Those are approved by Congress. Now the administration has brought some more, 76 more Section 301 cases that are being considered now by the Office of the U.S. Trade Representative. The administration is hoping to replace all these tariffs with new Section 301 tariffs. The IEEPA duties are not in effect.

And the 10% Section 122 tariff — is Customs still collecting it while this is being litigated?

The Court said, yes, we find them illegal, but we're going to allow Customs to continue to collect the 10% while this is being litigated. And ultimately, maybe it goes up to the Supreme Court, and they're going to have to have another refund system just like they did for IEEPA.

You filed suit on behalf of 100 companies. What are the stakes for your clients?

The largest is expecting $8 million back in refunds, the smallest $1,500.

Have any of your clients been casualties of this — gone out of business entirely?

Some of them did, because they couldn't afford to pay the tariffs at the time. A toy company who were bringing in all the toys from China and South Korea.

—Peter S. Green

(This interview has been edited and condensed for clarity and length)

Big Businesses mentioned this week

$GME ( ▲ 1.15% ) $EBAY ( ▲ 1.81% ) $SHAK ( ▲ 3.8% ) $JBLU ( ▲ 6.09% ) $UAL ( ▲ 2.24% ) $DEL ( 0.0% ) $AAL ( ▲ 3.27% ) $COST ( ▼ 4.21% ) $WMT ( ▼ 0.79% ) $FDX ( ▲ 0.35% ) $BF.A ( ▼ 2.54% ) $RGR ( ▲ 0.29% ) $NFLX ( ▼ 0.16% ) $CMCSA ( ▲ 0.67% ) $PSKY ( ▼ 4.31% ) $DIS ( ▼ 0.55% ) $SFTBY ( ▲ 3.2% ) $INST ( ▲ 0.09% ) $LMT ( ▼ 1.84% ) $TSLA ( ▲ 3.17% ) $NVDA ( ▼ 0.66% ) $AAPL ( ▲ 0.9% ) $AIFC ( ▲ 1.55% ) $DAL ( ▲ 2.21% ) $CBS ( 0.0% ) $POLYMARKET ( 0.0% )

This week, big business!

The usual suspects
The short stack
Trumplandia

The usual suspects

eBay to Gamestop: Sorry, I gotta wash my hair tonight. Calling GameStop $GME ( ▲ 1.15% ) CEO Ryan Cohen’s surprise $56 billion cash and stock offer “neither credible nor attractive,” Ebay‘s $EBAY ( ▲ 1.81% ) board said it had “thoroughly reviewed your proposal and has determined to reject it,” citing the unlikelihood of the deal getting financed (GameStop’s market cap is just $10.3 billion) and its lack of confidence in Cohen’s management ability. Cohen told eBay’s board he wanted to make the merged company into the pre-eminent e-commerce site for collectibles, gaming and enthusiast communities, and had a promise of a potential $20 billion in financing from TD Bank of Canada, if GameStop got an investment grade rating from two out of three top credit rating forms. Standard & Poor’s withdrew its credit ratings from GameStop in 2022 at the company’s request. Cohen told the FT last week that if eBay rejected his bid he’d make a hostile bid. “I’m not going to take no for an answer,” he said. “I’m a pain in the ass.” Gamestop shares fell more than 9% this week, while eBay shares have climbed nearly 6%.

IPOs Run on Dunkin ': Dunkin’, the chain formerly known as Dunkin’ Donuts, is going public in an IPO of parent Inspire Brands, which also owns Arby’s, Buffalo Wild Wings, Rusty Taco and Sonic Drive-In. With some 33,000 outlets driving $33 billion in revenue, an investor could be forgiven for thinking the IPO was to raise cash for expansion. But no, the $2 billion Inspire plans to raise will help pay back some of the money it owes its creator, PE fund Roark Capital, for buying Dunkin and the other brands in the first place. And while you, too, could own a Munchkin-sized stake in the company, as financial commentator Aalok Rathod noted in a post this week, “When this IPO prices, remember: you're not investing in the future of fast casual dining. You're refinancing someone else's acquisition spree, one Boston Kreme at a time.”
(Giphy)
Shaken Shack: Shares in bourgois McDonald’s upgrade Shake Shack $SHAK ( ▲ 3.8% ) plunged as much as 30% late last week, after the company said it lost money as foreign tourists avoid the U.S. over visa issues, winter storms cut into business, beef prices rose by about 17% and investments in new locations and products haven’t yet paid off. By Thursday, shares were down 55% from their peak last July.
Can Spirit resurrect JetBlue? All the focus on the demise of Spirit may have left you forgetting the trouble that for the past decade has beset JetBlue $JBLU ( ▲ 6.09% ) , and seen the airline lose 80% of its market value. With less than a 5% share of the U.S. market, it’s too small to compete with United $UAL ( ▲ 2.24% ) , Delta $DAL ( ▲ 2.21% ) and American $AAL ( ▲ 3.27% ) , and a merger with Spirit several years back was blocked by regulators who saw the merger would have removed the pressure for cheap flights that Spirit imposed on the market. JetBlue has lost money every year since 2019, accumulating about $8.5 billion in debt. Well, Spirit is gone, and JetBlue may just have found salvation, taking some of its slots and flight routes, in the week since Spirit folded its wings and stopped putting downward pressure on airfares. JetBlue now has its eye on Spirit’s Ft. Lauderdale home base, say reports.
Polymarket Insiders: Sometimes it pays to crunch the numbers: The New York Times did a deep dive into the numbers around Polymarket $POLYMARKET ( 0.0% ) wagers on global events and other happenings that have garnered outsized returns on not-very-sure bets. The upshot: More than 80 Polymarket users have placed bets with “suspicious characteristics,” the paper reported, including 38 “whose well-timed wagers” have gone largely unnoticed, among them a bet on Israel's strike on Iran last year and one on crypto regulation. The president’s son, Donald Trump, Jr., has a multi-million-dollar stake in Polymarket through his venture capital investment firm and the investment coincided with laxer regulation on the company.

The CEOs of NVIDIA, Tesla, & Microsoft Agree on One Secret

This year, the world’s biggest tech CEOs all said the same thing:

NVIDIA’s Jensen Huang called robotics a “once-in-a-lifetime opportunity.”

Microsoft’s Satya Nadella said 2026 is when AI will deliver real impact.

Tesla’s Elon Musk predicted, “AI and robots will make everyone wealthy.”

That opportunity’s arrived. Miso Robotics is leading the charge in bringing robotics solutions to the $1T fast-food industry.

Miso’s Flippy Fry Station AI robot has already logged 200K+ hours for fast-food brands like White Castle. Now, Miso has added iconic restaurant brands like Jersey Mike’s, Jamba, and Cinnabon as new customers.

With a new NVIDIA collaboration, strategic investment by industry leader Ecolab, and a growing manufacturing partnership, Miso can now scale to meet 100,000+ US fast-food restaurant locations, a $4B/year revenue opportunity.

Now, you can invest alongside Ecolab and become a Miso shareholder today. Even better, you can unlock free additional bonus stock for a limited time. Become a Miso investor today.

Become a Miso Investor Today

^{This is a paid advertisement for Miso Robotics’ Regulation A offering. Please read the offering circular at}^{invest.misorobotics.com}^.

END OF ADVERTISEMENT

The short stack

Jack Daniels goes Cold Turkey: Just a couple weeks after turning down a $15 billion stock and cash offer from French drinks maker Pernod-Ricard, Louisville’s Brown Forman $BF.A ( ▼ 2.54% ) the owners of Jack Daniels, see their future neat: They’ve turned down a $15 billion all-cash offer from privately held fellow bourbon-maker Sazerac. The sale would have created a colossus with about 30% of the U.S. whiskey market, giving it significant pricing power. The news is surprising, given that family-controlled—and run—Brown Forman has seen its share price slide by about two-thrids in five years, and observers largely fault the abilities of the family’s chosen executives to run the distiller. With both suitors now sent packing, the Browns appear ready to go it on their own. Brown Forman shares are down 5% since the news broke.
Buzzcut: Byron Allen says he’s buying control of the aging cat-meme news website Buzzfeed, just weeks before his “Comics Unleashed” is supposed to replace Stephen Colbert’s “Late Show” on CBS $CBS ( 0.0% ) . Allen will become BuzzFeed’s CEO and chairman, replacing founder Jonah Peretti, who said earlier this year that BuzzFeed is losing money, having piled up more than $50 million in debt. Allen said he plans to make the company succeed by beefing up BuzzFeed’s local U.S. news coverage and posting more videos made by BuzzFeed readers. Time to tee up your cat videos again?
Shotgun wedding; Well, not quite, but Italian gunmaker Beretta, the maker of James Bond’s original gun, before it was replaced by the Walther PPK in the opening scenes of the first movie, 1962’s “Dr. No”, has officially joined forces with U.S. gunmaker Ruger $RGR ( ▲ 0.29% ) . A testy takeover bid by the family-owned Italian gunsmith has ended with Beretta poised to take a 25% stake in U.S.-listed Ruger, gain two seats on Ruger’s nine-member board and a fast track into the world’s largest gun market, and have a chance to launch a tender offer for the whole company. Shares in Ruger have lost about half their value in the last five years, and the company posted a net loss in 2025 for the second consecutive year. Perhaps you’d be better off with a Walther, 007?

Streaming steals TV ads: In mid-May every year, New York’s theaters fill up with TV executives and advertisers for the so-called “upfronts,” where the networks and streaming platforms try to sell advertisers on their upcoming programming. Now, as “streamflation” hits the main platforms, including Netflix $NFLX ( ▼ 0.16% ) , Comcast’s $CMCSA ( ▲ 0.67% ) Peacock, Paramount‘s $PSKY ( ▼ 4.31% ) Paramount+, and Disney’s $DIS ( ▼ 0.55% ) Disney+, more viewers are opting for cheaper or free ad-supported streams. A Morning Consult survey showed 56% of adults, led, of course, by the ad-aware Boomers at 67%, prefer lower-cost ad-filled streaming plans. That’s got advertisers moving their dollars from the old linear TV networks to streamers, with the two expected to split the $40 billion U.S. ad pot in roughly equal parts by 2029, as the Wall Street Journal reports.
Money for nothing? As OpenAI raises money at ever-loftier valuations, but is still years away from a profit or an IPO that would set its fair market value, early investors are recording a paper killing. Take SoftBank $SFTBY ( ▲ 3.2% ) , whose 13% stake in OpenAI jumped in value by $44 billion, including a $25 billion jump in the first quarter. That’s helped push up Softbank’s share price by more than 200% in the past year. But much of SoftBank’s investment in OpenAI is borrowed, and if a planned OpenAI IPO this year falls short, SoftBank could see a wipeout like the one it took when it backed office company WeWork a decade ago.
Hackers look for a bigger Canvas: Millions of students across the U.S. got locked out of their main instructional platform, Canvas, in the hacking equivalent of stealing a schoolkid’s lunch money. Ransomware group ShinyHunters hacked into Canvas parent Instructure $INST ( ▲ 0.09% ) , stealing billions of messages and more than 275 million personal records. The hack was vast. 41% of U.S. colleges and universities use Canvas, and some 8,800 school districts and education platforms use it. Statewide tests in New York were postponed. Instructure says it reached an agreement with the hackers, but it has not revealed how much it paid to get the data back.

Trumplandia

The China Gambit: With president Trump in China, there’s a lot riding on his talks with Chinese leader Xi Jinping. At the heart of it is avoiding two wars: a hot war over Taiwan, the democratic island that China considers part of its territory, and which has long been a U.S. ally and a big buyer of U.S. arms (Taiwan has bought nearly 200 U.S.-made Lockheed Martin $LMT ( ▼ 1.84% ) F-16 fighter jets), and a trade war. Emboldened by the U.S. failure to bring Iran to heel, the hot war may still be on the burner, but both sides see the trade war as a bigger threat to their countries. Xi appeared to accede to Trump’s demands that China open its markets to more U.S. products, telling Trump China will “open wider” to U.S. companies. Trump was accompanied by Tesla $TSLA ( ▲ 3.17% ) boss Elon Musk, Nvidia $NVDA ( ▼ 0.66% ) CEO Jensen Huang, and outgoing Apple $AAPL ( ▲ 0.9% ) CEO Tim Cook. Boeing $BA ( ▼ 0.82% ) chief Kelly Ortberg is expected to sign some large orders for planes on the trip. Also on the trip with those CEO’s: Eric Trump, who the Financial Times reports is exploring a deal with a Chinese chipmaker linked to the ruling Communist Party. Eric Trump is an advisor to Alt5 Sigma (also known as AI Financial Corporation $AIFC ( ▲ 1.55% ) ), a Las Vegas-based fintech company whose board chair is Trump aide Steve Witkoff's son Zach. Alt5 and Hangzhou-based Nano Labs are in talks to build cloud computing centers in the U.S.
The war isn’t helping the U.S. economy: The Consumer Price Index rose 3.8% in April from a year earlier, with higher gas prices replacing tariffs as the key inflation driver, while wholesale prices, measured by the Producer Price Index, rose 1.4% in April alone, up 6% from last year. And it’s not just gas. Even tomatoes are getting pricer, up 40% in April from last year, with growers blaming intense rains, crop disease, a new 17% tariff, and surging gas costs for bringing tomatoes to the U.S. from Mexico. High gas prices also appear to be hammering beer sales, according to Nielsen data, with sales at convenience stores and gas stations down about 9% in early May. In California, where gas prices are the highest in the nation, beer sales dropped 16% in April. The price uncertainty is also hammering the real estate market, where most Americans make their biggest purchase ever: Existing home sales were flat in April, after dropping 3.6% in March, the National Association of Realtors reported. President Trump says he knows how to bring down gasoline prices, which are up more than 50% since the U.S. and Israel launched their bombardment of Iran. Trump says he’ll cut the 18.4 cents-a-gallon federal excise tax on gasoline. But that’s hardly going to make a dent in gas prices. It would cut costs by 4%, lowering the average price to $4.32 a gallon.

(Google)

The trials and travails of Kevin W. So after months of waiting, President Trump’s pick for Fed chair, Ronald Lauder's son-in-law Kevin Warsh won Senate confirmation (54-45) with Pennsylvania Sen. John Fetterman crossing party lines to support Warsh. Trump’s arch-Fed-enemy Jay Powell will stay on as a governor for another two years, and adding Warsh to the board means Trump’s temporary appointee, Stephen Miran, will have to step down, so there’s no guarantee of a consensus to lower interest rates, which could spur economic growth and/or a recession depending on which analyst or Fed board appointeee you’re talking to. “The economy is not in a “golden age” of high productivity growth and low inflation,” as Warsh told senators at his confirmation hearing, writes Fed watcher Ethan Harris. That is likely to leave Warsh, who’s only got one vote on the rate-setting Federal Open Market Committee, avoiding a rate cut in order to tame inflation.

Want more Cheddar?

SpaceX's $2 trillion IPO: Should we be bullish or bearish?

Cheddar's Big Business This Week — Thu, 07 May 2026 20:30:00 +0000

Raising $50 billion, turning SpaceX into a public company is expected to be the largest initial public offering in history. A lot of people stand to get very rich, with the company’s overall value expected somewhere between $1.5 trillion and $2 trillion, an astronomical sum for a niche company that is quite literally shooting for the stars. Early investors in SpaceX’s capital stack could make as much as 20x their initial investment.

(Google)

Musk’s plan to offer as much as 30% of the shares to individual investors and his followers would seem like an opportunity for a lot of investors to cash in on a company that could grow to a $7 trillion market cap in the next decade. But is the SpaceX IPO a good deal for individual investors? Can the company live up to the hype?

We spoke with bulls and bears.

The bull case for the company is straightforward. SpaceX has turned what was a bespoke business, launching rocket ships, into an industrial operation, launching 165 Falcon 9 missions, about 52% of all global orbital launches, reducing the cost of a launch by about 65%, according to Pitchbook analyst Franco Granda. Starlink has been remarkably profitable, doubling the number of customers last year to nearly 10 million and generating $5.8 billion in EBITDA on $10.6 billion in revenue.

SpaceX’s vertical integration reduces costs, and Musk’s expertise in manufacturing with Tesla suggests a lean, AI-powered manufacturing model will bring costs down further, and open more markets for the company.

What about the bear case? The biggest distraction could be the way Musk has used SpaceX to wrap up some of his less successful ventures, including Twitter and xAI. SpaceX spent $250 billion, most of it in the form of shares to be cashed out at the IPO, to buy xAI and Twitter. But xAI threw off only about $500 million last year, and now SpaceX says it will pay as much as $60 billion for AI company Cursor.

“The con case is much easier to make nowadays,” Granda said in an interview. He said he first thought SpaceX’s success came from being “the dominant supplier of space launches, plus the leading provider of satellite based Internet.” But the xAI and Cursor tie-ups don’t add value, he said, even if SpaceX solves a host of technical issues to put solar-powered, space-cooled AI data centers into orbit. In fact, Granda said, the offer for Cursor, plus a deal announced this week to lease much of xAI’s Colossus data center to Anthropic, shows xAI has no clear horizon, and that should worry retail investors. “It's a red flag. Because it just says, you're kind of making it up as you go,” said Granda.

“There’s risk because of where XAI sits in the competitive landscape today. No matter how much you embed Grok into your company, if it is a lagging model, you just won't get all the juice out of it,” Granda added.

Musk’s promises of ever greater things to come, like colonizing Mars or the end of work, might keep the stock at a sky high valuation, he said. But Musk’s non-stop X-posting and his pronouncements on everything from politics to his current feud with OpenAI chief Sam Altman, also pose a risk, one that Granda crunched the numbers on when he looked at Tesla stock movements over several years: “Actual business-related events drove the stock up 12% on average. But when Elon was involved, it was largely negative, and it was down 5%.”

Still, many investors may not have a choice. If you’re in an exchange traded fund that tracks the Nasdaq, new rules will have SpaceX in the index within 15 days, pushing many investment funds to buy and forcing up the price.

Gabriel Shahin, whose Falcon Wealth Planning was an early investor in SpaceX through a Special Purpose Vehicle, says despite the key person risk that it’s all riding on Musk, buying into the SpaceX IPO is probably a good move for retail investors. “It’s priced to perfection,” said Shahin, of the estimated $600 IPO price. For Shahin, SpaceX is a massive growth story, and investors should see themselves buying a piece of what may well be an effective communications monopoly as Musk brings SpaceX mobile phones on the market.

“He could be our modern day Lex Luthor,” Shahin said in an interview. “He'll know all of our data, all of our information. He can move satellites as fast as he wants for imagery in space. He has X that is real time news and information. This has all the potential in the world to be the largest company ever.”

Not that anyone wants a Superman villain to run the world, but as Shahin said in an interview, “From an investor point of view, it's a good thing. I think we want to be on the side of somebody who's changing the world.”

So will SpaceX shares ever come back down to Earth? Granda doesn’t think so.

One other big worry is: How big is too big? Jay Ritter, director of the IPO Initiative at the University of Florida’s Warrington College of Business, notes that the sheer size of the IPO, at more than 100 times trailing revenue, limits the upside for investors: “For almost all of the companies that have gone public at such a high multiple, everything has not gone quite right, and so the average return has underperformed the market by quite a bit, and that’s where I have reservations about SpaceX’s valuation.”

If retail investors are going to buy SpaceX — and shares are thought to be coming online as early as June — they ought to be prepared to hold the stock for five years or more. Early investors won't be able to sell their shares for six months according to initial reports of the IPO terms, so once the lockup ends, many of the investors may seek to cash out those 20X gains. And the low float - just 2.5% of the company’s initial valuation, means small share sales could see the stock price fluctuate wildly for the first couple of years, until the business model is proven and cash flow stabilizes.

The question for most investors may be whether investing in an Elon Musk company is worth all the agita that the company’s founder brings with it. From a pure stock price perspective it seems the short-term answer is, most likely, that it is. (Although this certainly doesn’t constitute financial advice). But don’t expect a comfortable ride.

—Peter S. Green

Big Businesses mentioned this week

$BP ( ▼ 1.68% ) $SHEL ( ▼ 1.02% ) $GME ( ▲ 1.15% ) $EBAY ( ▲ 1.81% ) $AMZN ( ▲ 1.4% ) $WMT ( ▼ 0.79% ) $BRK.B ( ▲ 0.13% ) $HSBC ( ▲ 2.01% ) $APO ( ▲ 1.44% ) $BCS ( ▲ 1.68% ) $MS ( ▲ 1.86% ) $DIS ( ▼ 0.55% ) $HOG ( ▼ 2.01% ) $SAVEQ ( ▲ 0.43% ) $GS ( ▲ 2.56% ) $BX ( ▲ 2.98% ) $AAPL ( ▲ 0.9% ) $META ( ▲ 4.7% ) $FIS ( ▲ 1.89% ) $IAC ( ▲ 0.38% ) $PSKY ( ▼ 4.31% ) $WBD ( ▲ 1.84% )

This week, big business!

War Story
The usual suspects
Media Mirror

War Story

Strait Talk: As Winston Churchill said about peace negotiations, “Jaw, jaw is better than war, war,” (it even rhymes, if you imagine Gary Oldman saying it while wearing too much makeup). With Iran and the U.S. appearing to be engaged in some kind of talks near week’s end, oil prices have dropped about 15% from late April highs, as Brent crude fell to about $98 and West Texas intermediate dropped below $92 a barrel. The S&P was up about 2% since last Friday, while the Dow stayed flat. The U.S. even guided a U.S. flagged tanker through the Strait of Hormuz. British Petroleum $BP ( ▼ 1.68% ) quarterly profit doubled to $3.23 billion from a year ago, and Shell’s $SHEL ( ▼ 1.02% ) profits zoomed to $6.92 billion from $5.58bn. Congressional Democrats are talking about a windfall profits tax and U.S. refiners are not planning to plug the supply gap (as much as 20% of global oil supply is cut off because of the blockade in the Strait of Hormuz) because prices may well fall in the year or more it would take to get new wells online.

The SpaceX IPO is Coming? Are you ready?

Most retail investors will hear about the SpaceX IPO only after it's too late. And by the time the headlines hit, the volatility has already begun.

This exclusive briefing covers the early signals Wall Street is watching right now, the access paths most people don't know exist, and why the window to prepare is narrower than you think.

Inside, you'll discover the verified signals that typically appear before a major IPO filing, what retail investors can legally access before a company goes public, and the positioning strategies serious investors evaluate before the market shifts. Don't wait for the news to break—get the data you need today.

Access the briefing

END OF ADVERTISEMENT

The usual suspects

More than a meme Stock? GameStop $GME ( ▲ 1.15% ) , the brick and mortar video game retailer (market cap $11.3 billion) said it’s making an offer for Ebay $EBAY ( ▲ 1.81% ) (market cap $48.13 billion), the ailing e-commerce company that pioneered the online garage sale, only to lose its top spot to Amazon $AMZN ( ▲ 1.4% ) and wind up in third place behind Walmart $WMT ( ▼ 0.79% ) . As GameStop CEO Ryan Cohen tells it, the deal is a right-swipe on M&A tinder: GameStop’s 1600 retail outlets and Cohen’s management skills will revive eBay’s fortunes and let it go head-to-head with Amazon. But GameStop’s $9 billion cash-on-hand make swallowing eBay (market cap $46 billion) a bit like a python swallowing an alligator. And then there’s GameStop’s own checkered history: The company nearly went bust but was saved by fans who turned it into a meme stock, taking on short sellers, who finally abandoned their, er…game after losing $20 billion in 2021. The eBay bid came in for a reality check when Cohen was interviewed by CNBC’s Andrew Ross Sorkin, who asked Cohen where he would find the money. Cohen kept insisting he didn’t understand the question, while Sorkin kept adding up the numbers and the company’s stock took a dive:

Berkshire without Buffett: Warren Buffett is a tough act to follow. Just ask Greg Abel, the Berkshire Hathaway’s $BRK.B ( ▲ 0.13% ) CEO, who hosted his first annual meeting since the Sage of Omaha retired. Buffett was famous for his folksy meetings and long-winded annual letter to shareholders, and the annual meeting attracted thousands of small holders of the company’s Class B stock, earning the meeting its nickname as the Woodstock of finance. Abel’s dry runthrough of the company’s holdings had some attendees walking out partway through his presentation. Shareholders are hoping that Abel’s strong performance will help Berkshire’s shares recover some of the 13% they lost since Buffett announced his departure last May. Abel said he’ll stick to Buffett’s famed value investing principles, while adding to Berkshire's $380 billion cash pile, and waiting for the kind of undervalued strong businesses that kept the firm growing for decades. But that may take some time. Buffett told CNBC during the meeting that the markets are becoming a casino. “We’ve never had people in a more gambling mood than now,” he told Becky Quick.
Banking bummers: The private credit crisis just claimed a few billion dollars in damage: The collapse of British mortgage lender Market Financial Solutions has forced a slew of top banks to report massive losses on loans they are unlikely to recover. They include HSBC $HSBC ( ▲ 2.01% ) which has just had to write off $400 million of the $540 million it loaned to MFS through Leon Black’s Apollo Global Management $APO ( ▲ 1.44% ) and its Atlas SP subsidiary. Last week Barclays $BCS ( ▲ 1.68% ) wrote off $300 million that it had loaned to MFS. At the heart of the collapse is the lack of regulation and transparency in the private credit market, where outsized returns carry outsized, and often underreported, risk. In this case, there was an apparent fraud in which MFS pledged the same collateral to more than one lender, creating the illusion that it was more solvent than it really was.
Morgan Stanley’s Offshoring Oops: In an apparent effort to cut costs, Wall Street bank Morgan Stanley $MS ( ▲ 1.86% ) hired junior bankers from across Europe, moved them to low-cost offices in Budapest, and had them working on sensitive financial deals for U.S. clients, without the necessary licenses or supervision. The Wall Street Journal has the details on the junior bankers, who were promised transfers to New York or London but were paid as little as $1,755 a month, a fraction of what junior bankers get in New York, and were expected to work through the night to support colleagues in the big apple. Now, the U.S. Financial Industry Regulatory Agency is investigating.
The Great Mickey Makeover: Disney $DIS ( ▼ 0.55% ) CEO Josh D’Amaro said the storied entertainment firm is going to focus on streaming, making Disney+ “the primary relationship between Disney and its fans,” and promising not to sell off its linear TV networks, including ABC and ESPN. At the top of D’Amaro’s to-do list: Cutting the churn on Disney+ subscriptions. That means more short-form content and better recommendation tools to keep more eyeballs on Disney’s screen longer. Long-term, that’s all going even more interactive with games and theme park visit planning tools. D’Amaro said he’s also still looking at AI options. The market seems to approve, with shares up 7% on news that earnings rose 7% and EPS was up 8%. The stock is still down about half from its highs in 2021, though, so D’Amaro has a long way to go:

(Google)

There’s a Harley in your future: Harley-Davidson’s $HOG ( ▼ 2.01% ) new CEO wants to sell you a cheaper hog. Boosting sales by bringing in younger riders is the key to the company’s future, he says. But Artie Starrs’ plan also runs right up against Harley’s biggest historic selling point: Most of Its bikes have been made in the U.S.A. until now. So: A new $10,000 Sportster, with a more efficient engine, will be made in York, Pennsylvania. But the $6,000 Sprint, with a 440 cc engine, will be made in Thailand. Harley’s stock has lost half its value in the past five years, but it’s up 35% since mid-March on the plans.
Spirit gives up the ghost: It’s official. Spirit airlines $SAVEQ ( ▲ 0.43% ) ceased operations last weekend, amid a 78% rise in jet fuel prices due to the Iran War, and objections by some creditors to the Trump Administration’s planned $500 million bailout for the discount carrier. On its last day of service, April 30, Spirit flew 50,000 passengers. Its demise reduces pressure on rival airlines to provide low-cost fares on key routes, meaning all our air fares are likely to go up.

Tech talk

Now it’s OpenAI’s turn to release its AI supercybervillain: the lovingly named “GPT-5.5-Cyber,” which CEO Sam Altman said will be released shortly to “critical cyber defenders” before its general release, just as Anthropic last month held back its Claude Mythos Preview. The news eases some fears that AI firms lack the chips and data centers needed to power their models for enough clients to make back the prolific amounts they are spending on infrastructure. It also eases some fears that OpenAI is spending too heavily and moving too slowly in the battle for the first Super-powered Gen AI to hit the market. Meanwhile, all that spending is drying up the market for solid state hard drives, and raising prices for groups like Wikipedia parent Wikimedia and the Internet Archive. As 404media reports, a 2TB external Samsung SSD sold last fall for $159 and now costs $575:

(Google)

AI tools are changing so fast that even top tier investment companies like Blackstone and Goldman Sachs $GS ( ▲ 2.56% ) can’t keep up. So they’re creating their own help desk, a $1.5 billion joint venture with Anthropic to speed the adoption of Claude AI in their portfolio companies and their own operations. Blackstone $BX ( ▲ 2.98% ) and buyout shop Hellman & Friedman will each put up $300 million and Goldman’s investment funds will put up $150 million for the tech assistance. The new firm will place engineers inside client companies to help implement AI workflows.
Deep Cash? Remember DeepSeek, China’s budget AI that was really built and trained with ChatGPT? Well it’s baaack, baby, with a “few billion dollars,” from Chinese state-backed venture firms, the Wall Street Journal reports. The influx would value Deep Seek at $50 billion. For Beijing, it’s a way back to a commanding position in the AI-led future, where U.S. firms including OpenAI, Anthropic and xAI (a.k.a. Grok) dominate.
Meanwhile, AI is having its day(s) in court. Apple $AAPL ( ▲ 0.9% ) has agreed to pay $250 million to iPhone users who were told their iPhone 15s and 16s would run with Apple Intelligence. But Apple hit some speed bumps while rolling out its AI, and the features weren’t available on those phones. Indigenous actress Q’orianka Kilcher has sued Disney $DIS ( ▼ 0.55% ) and director James Cameron for using her likeness to create the face of the blue-skinned warrior-princess Neytiri (which happens to be phonetic Greek for “Yes, cheese”) in the 2009 film Avatar. “In the age of A.I., our likeness is no longer safe,” Kilcher, 36, told the New York Times “This case is about the future of identity.” Kilcher says Cameron told her she “inspired” Neytiri’s look. Meanwhile, a bunch of publishers and novelist Scott Turow have sued Meta $META ( ▲ 4.7% ) , saying the social media company illegally used their writings to train Meta’s AI. Meta argues that courts say using copyrighted material for training is “fair use.”
In case you planned to hide those Bitcoin profits, Anthropic and banking software provider Fidelity National Information Services $FIS ( ▲ 1.89% ) are launching a new AI software suite that monitors bank accounts for evidence of financial crime. The tool won’t just alert banks to potential midsdeeds, it will amass evidence that prosecutors can use in criminal cases. So, watch out!

Media Mirror

Is a new media mogul battle brewing? IAC $IAC ( ▲ 0.38% ) chief Barry Diller says he wants to buy CNN before Paramount $PSKY ( ▼ 4.31% ) chief David Ellison “ruins” it by merging the cable news giant with Paramount’s crumbling CBS News. Diller said he talked to CNN’s current owner Warner Bros. Discovery $WBD ( ▲ 1.84% ) before it agreed to sell itself to Paramount. “I would do it tonight,” Diller said of buying CNN, adding that CNN is ripe for innovation. He may get his chance: The Paramount deal is beginning to look shaky, as Middle East sovereign wealth funds that also pledged cash for the purchase redirect their money away from the U.S.
Murdoch Junior? Rupert Murdoch’s least-favorite son James (the leftish-leaning one who sued over dad’s decision to hand the media company to rightwing son Lachlan) is building his own media empire. Multiple news reports say he’s in discussions with Vox to buy part or all of the podcast and publishing firm that includes SB Nation and New York Magazine from current publisher Jim Bankoff. Murdoch Junior reportedly has over $1 billion in cash after settling up with Dad over ownership of News Corp, and evidently he’s eager to spend it.

Want more Cheddar?

OPEC shakeup: Why the UAE's departure is a distraction from the real oil price crisis

Cheddar's Big Business This Week — Thu, 30 Apr 2026 20:30:00 +0000

How many oil crises can the world track at once? There’s the supply chain crisis, the price crisis, and now the OPEC membership crisis, as the United Arab Emirates says it will leave the energy cartel. To understand what it all means, BBTW columnist Peter Green spoke with Boston University oil expert Prof. Robert Kaufmann.

This interview was condensed and edited for clarity

Peter Green: When the UAE says it may pull out of OPEC. Is this a big deal for oil prices?

Robert Kaufmann: It’s an interesting story, but I don’t think it’s going to have much impact on price. If you look at UAE, it produces around three and a half million barrels per day. And it had about a little over a million barrels a day in what we call shut-in, or spare capacity. It shut in some supply to help keep oil prices high, but it’s not like the UAE was either a big member of OPEC or shouldering a big portion of the shut-in capacity. Remember, the world oil market has never really been a free market. The period that my parents remember as the golden age of petroleum, the 1950s and 60s, when oil prices were low and stable, that was actually a noncompetitive market in which the Texas Railroad Commission acted like a pre-OPEC. It decided how many days per month oil fields in Texas could pump oil. And its goal was to stabilize oil prices, to shut in production to balance supply and demand. When OPEC started, that was their original goal, to balance supply and demand. But they quickly realized, “we have the upper hand here,” and they were able to raise oil prices. Recently, OPEC is back in that role of the Texas Railroad Commission, balancing supply and demand, shutting in some capacity. So if OPEC really falls apart, which some people seem to be rooting for, consumers are going to lose because oil prices will go back to fluctuating wildly.

Who will that hurt?

The biggest losers will be U.S. frackers, because fracking requires a fairly high price for them to make a profit on. And if oil prices are going to fluctuate greatly, frackers are not going to invest huge sums of money drilling wells that may or may not be profitable. So the end of OPEC is not good for U.S. consumers or U.S. producers. But I do not think that UAE leaving spells the end of OPEC.

Other countries, including Indonesia, have left OPEC, and four of the world’s top five oil producers aren’t members: The U.S., Russia, Canada and Iraq. But why would the UAE leave OPEC?

OPEC’s goal is to stabilize oil prices and defend an official price. And the way they do that is they get together every three months, and say, oh, we think the world needs, you know, 30 million barrels per day of oil from OPEC to keep supply and demand in balance. But we as a group can produce 35 million barrels per day. So what they’re going to then do is ration production among the members. They’re going to tell them, you shut in half a million barrels per day, you shut in a million barrels per day. And so that’s why all these countries have, a level of production and spare capacity. By leaving OPEC, they will no longer have to abide by a quota, so they can produce more oil and in effect free ride on the fact that the Saudis are shutting in production.

Does OPEC still have enough weight to set the price of oil?

Let’s be very clear. It doesn’t set the price. It can influence a range of prices. The price of crude oil is set on very thickly traded markets like the New York Mercantile Exchange, where you buy and sell futures contracts for what’s known as West Texas Intermediate, or the International Petroleum Exchange, where you buy and sell futures for Brent crude. OPEC can influence what traders are willing to buy and sell at, but it’s not like the olden days where they set an official price. They don’t have that power.

Looking beyond OPEC, what happens if the current oil shock keeps going?

If the Strait of Hormuz remains shut for the next six months, crude oil could be $200 a barrel. And there will be shortages. You know, you will only be using crude oil for the most necessary uses because it’ll be $200 a barrel. So you won’t be flying anywhere on vacation,and you’ll be setting your home thermostat at 55.

Would the United States actually face shortages, or would the impact be worse elsewhere?

In the U.S., we probably won’t have shortages, per se, because we produce a lot of oil domestically. But I’m not sure I would fly to Europe this summer. Their airports are starting to run out of jet fuel. Unlike being in California or Florida, if you’re stuck in Denmark, there’s no other way to get home than flying.

If the crisis ended quickly, how fast would oil prices come down?

So, you’ll see a big jump down. My guess is if oil prices are now $105, it’ll probably come down into the $80s. Once oil starts flowing again, yes, people want it for their car and their jet, but refiners are going to want to rebuild their inventories. I teach my students about the relation between futures markets and inventory markets. Inventories prevent oil prices from going up very quickly, but they also prevent prices from dropping very quickly. My guess would be oil prices are not going back down to $55.

—Peter S. Green

Big Businesses mentioned this week

$GM ( ▲ 0.54% ) $ORCL ( ▲ 2.66% ) $PSKY ( ▼ 4.31% ) $WBD ( ▲ 1.84% ) $LULU ( ▲ 2.54% ) $NKE ( ▼ 0.26% ) $SBUX ( ▲ 2.45% ) $META ( ▲ 4.7% ) $UAL ( ▲ 2.24% ) $AAL ( ▲ 3.27% ) $DEL ( 0.0% ) $BF.B ( ▼ 2.17% )

This week, big business!

War Story
The usual suspects
Trumplandia
Elon’s World

War Story

It looks like the U.S. Navy is going to be parked by the Strait of Hormuz for a while longer, and that’s got some major implications for the global economy. President Trump told aides to prepare for an extended blockade, the Wall Street Journal reported, until Iran “says uncle,” and Sec of Defense Pete Hegseth said the war has cost about $25 billion so far, while asking for a record $1.5 trillion for defense next year, a nearly 50% increase. That would certainly boost defense stocks, but with the national debt now at $39 trillion, and $10.1 Trillion of that added by Trump in his two terms, it may be hard to find that cash. And with oil now trading at over $100 a barrel, and likely to rise and stay there, even China is beginning to feel the hurt. A massive net energy importer, China gets70–75% of its crude oil and 40–45% of its natural gas from abroad. But nine weeks into the war, China is showing the strain. Retail car sales are down 26% from a year earlier, retail sales are slowing, its giant energy reserves have given it some resilience, but production of everything from toys to cars is falling, with buyers spending their disposable income on energy. And even as the U.S. restores sanctions on Iranian oil exports, Russia is still free to sell whatever oil isn’t burning from Ukrainian drone attacks, and General Motors $GM ( ▲ 0.54% ) says its sales of gasoline-powered cars and pickups are holding up, and a $500 million tariff refund helped it beat analysts estimates, even as the war has raised its costs, and gas prices rise to a national average of $4.11 a gallon this week. Europe and Asia’s oil shortage sent West Texas Intermediate crude to $110 a barrel early Thursday, a blessing for US crude exports, which soared by 1.6 million barrels a day to a record 6.4 million a day last week.

Stop Losing Your Money. It's time to upgrade your trading platform.

Your current trading platform is probably letting you down

Limited assets (no international stocks, no commodities, no pre-IPO companies)
Limited ability to short
Limited access to leverage
Limited trading hours

Liquid is one of the fastest growing trading platforms, allowing users to trade stocks, commodities, FX, and more 24/7/365 from their phone and computer.

Trading on Liquid is as simple as:

Pick an asset
Pick long or short
Pick your position size and leverage
Place your trade

The best part is that Liquid markets never close. So no matter what is going on in the world, you are able to keep your portfolio positioned properly.

Start trading 24/7 today

END OF ADVERTISEMENT

The usual suspects

(Google)

Ellison’s money blues? Oracle $ORCL ( ▲ 2.28% ) founder Larry Ellison (pictured above) is at the center of a whole lotta stuff these days: $40-billion dollar deals to build AI data centers, helping to fund a takeover of the U.S. operations of China’s TikTok, and bankrolling his son David’s successive media takeovers of Paramount $PSKY ( ▼ 4.31% ) and now Warner Bros Discovery $WBD ( ▲ 1.84% ) , all while remaining a trusted adviser of President Trump. But a deep dive by the Wall Street Journal suggests that Ellison’s $215 billion fortune (Bloomberg pegs him as the world’s sixth richest person) is becoming a house of cards, threatening the success of all of these ventures. Some 80% of Ellison’s fortune comes from Oracle shares, and about a third of those are pledged to back various loans and investments. But those investments are looking increasingly shaky, meaning the other 56% of Ellision’s fortune could collapse in value if any of these projects falter. A few Fawlty Towers candidates include the $40 billion Oracle has agreed to spend to buy Nvidia $NVDA ( ▼ 0.66% ) chips for the Stargate AI centers that OpenAi is building with SoftBank $SFTBY ( ▲ 3.2% ) . OpenAI is not generating the use or revenue it would need to rent the chips’ computing power from Oracle. Then there’s the WBD deal, which depends on $24 billion from Saudi, Qatari and Abu Dhabi sovereign wealth funds, which are now being redeployed to rebuild energy infrastructure destroyed in the Iran War. Ellison owns about 40% of Oracle, but the company’s share price has dropped by half since peaking last September.
Yoga ain’t toothpaste: That’s what Lululemon $LULU ( ▲ 2.54% ) founder and board rattler Chip Wilson said in his umpteenth letter to shareholders this week, urging them to pick his three nominees for the board of the foundering women’s athleisure wear brand. The company’s shares have plunged 73% since a December 2023 peak above $500. That’s despite revenue that hasn’t stopped growing since the company went public back in 2007. But the growth rate has slowed - up less than 1% last year, amid pressure from rivals including Alo Yoga and Vuori, falling demand and import tariffs. Wilson says the forthcoming appointment of ex-Nike $NKE ( ▼ 0.26% ) exec Heidi O’Neill shows the board just doesn’t understand the brand, and needs to hire a chief “who can deliver on the newest zeitgeist.” Wilson wrote: “Lululemon is not a toothpaste brand.” Blood in the water from the boardroom turmoil is attracting sharks: activist hedge fund Elliott Management has built a stake of more than $1 billion in the $16.45 billion company.
Starbucks turnaround? Has the Chipotle Kid done it? Starbucks $SBUX ( ▲ 2.45% ) CEO Brian Niccol, the former burrito chain boss, said sales are bouncing back and he raised the company’s growth forecast for 2026, amid signs that his turnaround for the storied coffee concern may be working. Starbucks has invested hundreds of millions of dollars in improving its stores, changing workflows and boosting barista pay. “Customers now believe their Starbucks purchase is worth it compared to a year ago,” Niccol said on a conference call. Shares are up 18 percent in the past month, and 25% for the year. Although if you’d invested in the S&P500 when Niccol took over, you’d have made a comparative killing:

(Google)

The used car market will soon be flooded with electric cars. While Detroit keeps pumping out gas guzzlers, Volkswagen is rolling out new, low-price EVs across its brands (VW, Skoda and Cupra), with a 25,000-euro VW Polo, aiming to compete with cheaper Chinese EV’s. BYD’s entry-level Dolphin Surf sells in Europe for 23,000 euros. And while China may be leading the world with electric car uptake, the three most profitable publicly traded Chinese carmakers Geely Automobile Holdings, Chery Automobile and BYD, all reported double-digit declines in net profit in the first quarter, reflecting a worsening domestic economy and the expiration of tax incentives for car buyers. Meanwhile back in the U.S., leases will be expiring later this year on hundreds of thousands of EVs, flooding the market with used vehicles that dealers expect will be cheaper than used gasoline-powered cars. By 2028, 800,000 off-lease EVs will be entering the market each year, Automotive News reports. That’s good news for drivers (and the environment) but may make a new $60,000 Tesla Model Y a tough sell.
The holy Spirit? President Trump’s announcement that the federal government may offer failing Spirit Airlines $SAVEQ ( ▲ 0.43% ) $500 million in cash to save it from bankruptcy, in exchange for warrants for 90% of the carrier, was already a bad idea, many in the industry have suggested. As United $UAL ( ▲ 2.24% ) CEO Scott Kirby said last week, “The Spirit business model is fundamentally flawed, and it’s going to fail.” But other budget airlines want some of that bailout cash. The Association of Value Airlines wants $2.5 billion in loans for its members to help offset the high price of jet fuel. That’s setting up a civil war in the airline industry. Majors like American $AAL ( ▲ 3.27% ) , Delta $DEL ( 0.0% ) and United don’t like the pressure discounters’ prices put on their own margins. And the discounters will need to get Congress to find the cash somewhere first.

KPMG gets marching orders: The U.S. Army hasn’t passed an audit in eight years of trying, so it’s making the logical move and firing its auditors. Big Four firm KPMG has lost its $60 million annual contract, and will move 450 staff to other projects. Defense Sec. Pete Hegseth said he’s consolidating audits and financial reporting across the military ahead of a 2028 deadline by Congress to account for America’s trillion-dollar defense budget.
Last call? Kentucky’s Brown family, who control Jack Daniel’s maker Brown-Forman $BF.B ( ▼ 2.17% ) have called off sale talks with Pernod-Ricard, rejecting the French distiller’s offer that reportedly tied up 80% of the offer in Pernod stock, which, like Brown-Forman, has lost about two-thirds of its value in the past five years. Blame changing tastes, poor marketing and Trump tariffs for the decline. Now, New Orleans-based Sazerac, another family-run (and family-owned) distiller, is back in the mix, with a $15 billion all-cash offer to match Pernod’s. Whiskey Bible author Noah Rothbaum says that deal’s much more likely, and could see the Brown family keep control of their original brand, Old Forester, as part of a sale to Sazerac. Brown-Forman shares dropped about 10% on Tuesday. Down the hatch!

Tech talk

Truly mag-nificent? The Mag-7 tech companies reported earnings this week, and business-wise things are looking good for almost everyone—except for investors: They appear to be getting nervous about the massive scale of planned tech spending this year —an unprecedented $650 to $700 billion—and whether there will be enough demand to pay for it all. Five of the seven stocks fell Thursday morning, despite rising revenue. Here’s what happened:

Company	Ticker symbol	Revenue change	Net income change	Share Price Change Thursday AM
Alphabet	$GOOGL ( ▼ 0.84% )	+22%	+81%	+5.62%
Amazon	$AMZN ( ▲ 1.4% )	+17%	+77%	-0.82%
Meta Platforms	$META ( ▲ 4.7% )	+33%	+61%	-9.87%
Microsoft	$MSFT ( ▲ 0.27% )	+18%	+23%	-5.39%
Apple	$AAPL ( ▲ 0.9% )	Not yet reported	Not yet reported	+0.34%
Tesla	$TSLA ( ▲ 3.17% )	+16%	+17%	-0.68%
Nvidia	$NVDA ( ▼ 0.66% )	Not yet reported	Not yet reported	-3.25%

China’s limits on foreign tech also hit hard this week: Goldman Sachs $GS ( ▲ 2.56% ) told its Hong Kong bankers to stop using Anthropic, for fear of violating both its agreement with Anthropic and Chinese tech laws, and Beijing said Monday it would force the Chinese founders of a Singapore-based AI company called Manus to unwind their four-month-old sale to Meta $META ( ▲ 4.7% ) , claiming the deal violated export rules on Chinese tech.

Trumplandia

The umpire strikes back: He may be on the down escalator, but outgoing Fed chair Jerome Powell still has some teeth. At this week’s meeting of the rate-setting Federal Open Markets Committee rates were held steady, though tea-leaf readers say the Fed’s post-meeting statement suggests growing support for further cuts, particularly if data show the war hurting the economy. Powell also announced he’ll be staying on as a governor even after the new chair, Kevin Warsh, is confirmed. That means Trump’s only placement on the board, Stephen Miran, will have to step down when Walsh takes office. And Warsh’s installment took a step forward when the Dept of Justice yielded to threats from Sen. Thiom Tillis, the North Carolina Republican, who vowed not to approve any Fed nominees until the DoJ dropped its investigation of Powell over the Fed’s headquarters reconstruction.

Blame Canada? They’re doing alright up north, despite the Trump tariffs and a simmering trade war with Washington. (“They suck,” U.S. Commerce Sec. Howard Lutnick said of Canada last week, musing that the current free trade pact with Canada should be renegotiated). Prime Minister Mark Carney told Parliament this week the economy will grow 2% this year, up from 1.7% last year, with rising oil prices boosting government revenues. He's also launching a Canadian sovereign wealth fund of 26 billion Canadian dollars ($19 billion USD).

Elon’s World

About that SpaceX IPO: It looks like Musk is about to pass into Don Quixote territory, dreaming the impossible dream. If SpaceX hits a market value of $7.5 trillion, and establishes a permanent human colony on Mars with at least 1 million people, Musk gets 200 million super-voting shares, according to an SEC filing obtained by Reuters. He gets another 60.4 million shares if SpaceX puts 100 terawatts of computing activity into space. For comparison, the U.S. currently can generate 1.3 terawatts of electricity. An IPO planned for June would value the company at about $1.75 trillion. As of December 31, Musk held 68.8 million Class B stock options with a strike price of about $42. The IPO would value those shares at around $600 or more, giving Musk a profit of over $550 per share, or $38.39 billion. That’s left SpaceX and Tesla $TSLA ( ▲ 3.17% ) dueling for Musk’s attention.

Want more Cheddar?

Can Warsh prove his independence?

Cheddar's Big Business This Week — Thu, 23 Apr 2026 20:30:00 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

Kevin Warsh, second from left (Getty Images)

Sometimes it helps to have friends in high places, and sometimes it doesn’t. Just ask Kevin Warsh, President Trump’s nominee to be the next chair of the Federal Reserve.

At a three-hour hearing on Tuesday, members of the Senate banking committee grilled Warsh on everything from how independent he’d keep the Fed (independent, he said), to whether he’s just a “human sock puppet” for Donald Trump (no, he said) to whether he invested any of his $100 million personal fortune with Jeffrey Epstein (Warsh, somewhat ominously, wouldn’t answer that question despite being asked for a simple “yes-no answer” by Democratic Senator Elizabeth Warren).

There’s a lot at stake here. Jay Powell, whose term expires next month, has been resolute in keeping interest rates up to stave off inflation, even as President Trump has tried to politicize the Fed, pushing Powell to cut rates, even letting former AG Pam Bondi investigate Powell for overspending on a rehab of the Fed headquarters. That's a sore point: Sen. Thom Tillis, a North Carolina Republican, said he won’t approve any nominee until the Powell investigation is closed.

Trump put Warsh through an Apprentice-style tryout for months before selecting him, and while he is the president’s candidate, it’s not easy having a friend like Trump. While Warsh told the committee that Trump had “never asked me to predetermine, commit, fix, decide on any interest rate decision in any of our discussions, nor would I ever agree to do so,” just hours earlier, Trump told CNBC he’d be “disappointed” if Warsh didn't cut interest rates.

Warsh has been a Fed governor under Ben Bernanke from 2006 to 2011, and studied economics at Stanford with supply-side guru Milton Friedman. The big question for Warsh is: Will he resist Trump’s pressure to cut rates before November's midterm elections, even if that means fueling inflation down the road?

Fed watcher Ethan Harris, former head of global economic research at Bank of America, notes that Warsh has done an about-face on rate policy, first a reliable hawk warning not to cut rates because easy money could spur inflation, then taking Trump's line that the economy is already in a golden age of AI-fueled high productivity and growth, with low inflation. Warsh's views have shifted over time, and there's even an Economist chart going around showing how his views on interest rates change with whoever is in office:

Justin Wolfers (@justinwolfers) on Threads

This chart seems to suggest a striking pattern: Kevin Warsh's speeches are consistently hawkish, except when Trump is President and about to appoint a new Fed Chair. https://www.economist.com/finance-and-economics/2026/02/05/untangling-the-ideas-of-donald-trumps-fed-nominee

Threads

“The claim of a “golden age” for the economy allows a new Fed Chair to both claim full independence from the President and do what the President wants for monetary policy,” Harris wrote in a blog post this week. “The test of his true feathers will come when he does or does not react to evidence that there is no golden age and inflation is remaining sticky high.”

One key aspect of the Fed chair’s job is communication. Markets dissect every pause and every comma the fed chair utters, and Claudia Sahm, Chief Economist at New Century Advisors, notes that Walsh’s refusal to answer direct questions or clearly state his views on monetary policy and inflation don’t bode well for his tenure. Business and investors want certainty, and they want clear signals about where the Fed plans to move interest rates and why. That’s why they pore over those Fed minutes.

”I have concerns that he’ll shape his role at the Fed to be the good Fed chair that the president wants,” Sahm said in an interview with BBTW. And that would be bad for the economy, she added. “When politics get into the mix, things tend to go off the rails in terms of inflation and economic stability, so interest rates matter. It affects businesses and households, you want these decisions to be made in a thoughtful way that’s connected to reality and not to politics.”

Chris Hodge, chief U.S. economist at investment bank Natixis, says he thinks Warsh will do a fine job as chair. “He is going to take the job seriously, because he knows he’ll be in the history books,” Hodge said in an interview with BBTW, especially having undergone a year-long public audition for the job. “He’s been on the record for 20 years taking a hawkish stance on rates, so don’t take the last 18 months at face value,” said Hodge.

Hodge says Warsh can be expected to work with the Fed staff and other governors, and he likes some of the changes Warsh is proposing, including fewer public statements and press conferences by the Open Markets Committee, and do away with the Fed’s famous—and anonymous—dot chart, which shows where various members of the committee stand on raising rates. “Do I think Warsh will maintain the Fed’s independence? Yes,” said Hodge. “He’ll be making policy for posterity. Plus, he’ll be moderated by the markets.”

But the bigger problem goes back to Trump, said Sahm. “Normally, by the time you go before the senate for your confirmation hearing, you’ve won the confidence of the President," said Sahm. But Trump hasn’t called off the probe into Powell, a clear sign, says Sahm, that the President is using the threat against Powell as a way to keep Warsh singing to his tune on interest rates.

But ultimately, both Sahm and Hodge agree, the biggest force insulating Warsh from Trump’s potential interference is the fact that even as chair, Warsh is only one of 12 votes on the panel.

—Peter S. Green

Big Businesses mentioned this week

$BBY ( ▲ 2.46% ) $UBER ( ▲ 1.02% ) $SAVEQ ( ▲ 0.43% ) $X ( ▼ 0.02% ) $INTC ( ▲ 2.09% ) $JBLU ( ▲ 6.09% ) $UAL ( ▲ 2.24% ) $AAL ( ▲ 3.27% ) $AAPL ( ▲ 0.9% ) $GOOG ( ▼ 0.69% ) $MSFT ( ▲ 0.27% ) $AMZN ( ▲ 1.4% ) $META ( ▲ 4.7% ) $ORCL ( ▲ 2.66% ) $DJT ( ▲ 0.71% ) $TSLA ( ▲ 3.17% )

This week, big business!

War Story
The Usual Suspects
Trumplandia
Elon’s World

War Story

Dire Straits: The dispute over who is going to let whose ships go through the Strait of Hormuz is having some serious effects on the global economy. Deep-pocketed countries from China and Japan to the U.S and Europe can buy what they need on the open market, paying whatever it takes, but smaller Asian countries, and especially African nations, are feeling the squeeze in their supply chains, and Southeast Asian economies that depend on imported fuel for manufacturing exports face grinding to a halt. “Once again, a large unanticipated shock hits the world economy and it’s every country for itself,” Eswar Prasad, a Cornell economist, told the New York Times. “This is not the world in it together and trying to sort out the problem jointly. Every country is going into survival mode.” The Philippines declared a national energy emergency last month, and in India the government has been raiding hoarders of cooking gas. Every rumor of cease-fire and renewed hostility sends stock prices and oil futures rushing in opposite directions, and the disruption has been so great that President Trump said on Tuesday he may offer U.S. financial support to the oil-rich United Arab Emirates. Meanwhile countries that had gotten their energy from the Gulf are looking elsewhere and old pipelines are coming back into service to avoid the Persian Gulf. Singapore’s foreign minister warned that the Hormuz debacle is just a “a dry run” for what will happen to global energy and commerce if China moves against Taiwan or the Philippines, closing the Strait of Malacca or the South China Sea. Meanwhile oil prices show no sign of coming back to where they were before the U.S.and Israel began bombing Iran on Feb. 28. Brent Crude spot prices are back over $100 barrel, and domestic gasoline prices are not coming down anytime soon. The average price for a gallon of gas in the U.S. was $4.03 on Thursday. Energy Secretary Chris Wright told CNN over the weekend that gasoline might not fall below $3 a gallon until 2027, but after President Trump said on Monday that Wright was…er…wrong, the energy secretary told a Senate hearing on Wednesday that he’d said no such thing. “I don’t know the future of energy prices,” he told the Senate Energy Committee.

END OF ADVERTISEMENT

The Usual Suspects

Better Buy? Best Buy $BBY ( ▲ 2.46% ) CEO Corie Barry will step down this year, replaced by chief customer, product and fulfillment officer Jason Bonfig. Barry led BestBuy through the challenges from Covid and Amazon, which saw other specialty mega-retailers like Circuit City and Sports Authority shut down. Sales barely grew under her leadership, a trend that’s difficult to interpret as tech products increasingly ship direct to consumers. Shares also rose only 6.2% under Barry, as the S&P jumped 157%. They dropped 6% on the news of her departure.
Can Red Lobster Claw its Way Back? Emerging from bankruptcy, seafood chain Red Lobster just can’t quit Endless Shrimp, the menu item some said was to blame for its troubles (it really wasn't the culprit, according to my sources at Quartz). This time you can’t get it delivered (it’s not clear how that “endless” thing would have worked with UberEats) and it's only available on certain days. Two years after entering bankruptcy protection, sales were down 6% last year from 2024, and the Lob is trying to renegotiate more leases and close more unprofitable locations.
Uber Trouble: Ride-share firm Uber $UBER ( ▲ 1.02% ) just lost its second sexual assault case, this time in North Carolina where a jury found the company liable for a 2019 assault by a driver on a young female passenger. Brianna Messing only won a $5,000 judgment, but the case is seen as a bellwether for the 3,000 more sexual assault cases against Uber. In February, a Phoenix jury ordered Uber to pay $8.5 million to a passenger raped by a driver. At issue: not only whether Uber adequately screens its drivers and provides adequate safety protection for riders, but whether the drivers are effectively employees or contractors, making the company liable for their actions. Shares in Uber are down more than 9% this year.
Spirit in the Sky, Again? The President is now positioning himself as the savior of a not-quite holy Spirit $SAVEQ ( ▲ 0.43% ) , the bankrupt airline. “Maybe the federal government should help that one out,” Trump told CNBC on Tuesday. By Wednesday, the Dept. of Transportation was in talks to extend a cash lifeline to Spirit in exchange for warrants giving it a stake in the failed carrier. Remember U.S. Steel $X ( ▼ 0.02% ) and Intel $INTC ( ▲ 2.09% ) ? At least those companies had a national security element, but do cheap Florida vacations deserve DefCon4 status? Spirit went bankrupt twice after bigger airlines offered their own super-economy fares and federal trust-busters blocked a planned merger with Jet Blue $JBLU ( ▲ 6.09% ) . Now it looks like a Dept of Transportation-Spirit merger may be in the works.
Not so fast for United and American. Some of those same pressures, plus the Iran War double whammy of higher fuel prices and nervous passengers, prompted talk this month of United Airlines $UAL ( ▲ 2.24% ) merging with long-time rival American $AAL ( ▲ 3.27% ) , the smallest of the major U.S. airlines. But that move was quickly shot down by both American and some top politicians, including a bipartisan group of U.S. senators who warned the two carriers that a merger could lead to higher air fares and fewer flights in overlapping markets. United has slashed its 2026 earnings forecast to $7 per share from a January prediction of $12.
Not the Onion: That satirical news site says it reached agreement to rent what’s left of Infowars, the right-wing conspiracy site that host Alex Jones lost in a defamation suit when he called the 2012 Sandy Hook elementary school mass shooting a “hoax.” It wasn’t. It left 20 children aged six and seven dead, and killed six adults who were trying to protect the kids. It also cost Jones his media empire, which at one point had 2.4 million YouTube subscribers. A bankruptcy court judge barred the Onion from buying InfoWars, so now it will be renting the site for $81,000 a month (the money goes to Sandy Hook survivors and victims’ families). Oddly, Jones continues to run the site. The Onion says it plans to run InfoWars as a parody of Jones and his bombastic conspiracy theories. “We are excited to lie constantly for cold, hard cash, but this time in a cool way, and we’ll make sure some of it gets back to the families,” said Ben Collins, CEO of Onion parent Global Tetrahedron. Jones, who doesn’t seem to be taking it too well, took his shirt off and ranted about the move on the website formerly known as “Russia Today”:

Tech talk

Apple Turnover: Apple $AAPL ( ▲ 0.9% ) CEO Tim Cook will step down Sept 1 after 15 years at the tech giant, where he presided over a 30-fold increase in the company’s share price, turned the iconic iPhone into the world’s most ubiquitous power symbol, and introduced the Apple Watch, Airpods and AppleTV+. Replacing him is John Ternus, Apple’s 50-year-old senior vice president of hardware engineering. Temus, a 25-year veteran of the tech firm, oversaw the development of the iPad and the new $599 MacBook Neo. His big challenge will be steering Apple through the AI era, and finding new reasons for consumers to get excited about its products. He’ll have big shoes to fill. Cook has also become Silicon Valley’s top diplomat defending the tech industry’s far-flung empire to successive U.S. administrations, and in Beijing, a role Cook will keep in a new position as executive chair. As recently as February Cook was knocking down reports he’d be stepping down. Apple is at a clear turning point. In a world of chatbots, Siri is nearly obsolete, and Apple has ceded the race to develop the next gen AI to rivals and upstarts from Google $GOOG ( ▼ 0.69% ) and Microsoft $MSFT ( ▲ 0.27% ) T to OpenAI and Anthropic. Cook, who was tapped by Steve Jobs as Apple’s mercurial founder lay dying of pancreatic cancer, recently told the Wall Street Journal the advice he’d give his eventual successor: “Be yourself,” said Cook. “Keep a firm North Star on the values of the company.”
The circularity continues: Amazon $AMZN ( ▲ 1.4% ) is tightening its bonds with Anthropic in a circular financing deal that swaps $5 billion in Amazon cash for an Anthropic promise to buy $100 billion in Amazon computing capacity (aka “compute”), and Amazon says its total investment could hit $25 billion. Anthropic promised to use 5 gigawatts worth of Amazon’s own AI proprietary AI chips, which may bestow legitimacy on these bespoke chips. It’s all part of a push by tech firms to be at the front of the pack as AI becomes a big slice of everyday business. But Amazon’s announced plans to spend $200 billion on capex this year, most of it AI-related, have analysts wondering if Amazon will do enough AI business to justify the spending. Back in February, Amazon shares dropped 9% in the hours after it announced the $200 billion plan, a 60% increase from 2025 spending. A report out this week from AI customer-service platform Parloa finds that only about 5% of large consumer-facing firms have AI chatbots on their websites, so either there’s room to grow, or there’s no demand. Meanwhile, the AI spending rage continues with Microsoft $MSFT ( ▲ 0.27% ) , Meta $META ( ▲ 4.7% ) , Alphabet $GOOG ( ▼ 0.69% ) , Amazon $AMZN ( ▲ 1.4% ) , and Oracle $ORCL ( ▲ 2.66% ) planning to spend a collective $700 billion on AI-related infrastructure this year.That’s more than Gerrmany’s federal budget.
Satoshi Solved? The latest digital detectives to weigh in on the true identity of bitcoin founder Satoshi Nakamoto say two dead guys invented Bitcoin: Belgian cryptologist Len Sassaman and Hal Finnery, a Silicon Valley developer and cypherpunk. Sassaman killed himself in 2011, and Finney died of Lou Gehrig’s disease in 2014. Both have previously been named as Bitcoin’s creators, and both have had their roles posthumously debunked. Sassaman famously tweeted back in 2010 that Bitcoin was “bunk.” Still, former investment banker and Puck journo William D. Cohan and his investigative partner, private eye Tyler Maroney say they’re right and have posted their film at findingsatoshi.com where you can watch it for $17.88. That’s a lot less than a bitcoin.
Face/Off. Meta $META ( ▲ 4.7% ) is cutting 10% of its workforce, or 8,000 jobs, in an effort to offset its AI spent, according to an internal memo reported by Bloomberg. The company disclosed the move in a memo sent to employees Thursday, saying the layoffs will come on May 20. Meta also won’t hire workers for 6,000 open roles that it had intended to fill. “We’re doing this as part of our continued effort to run the company more efficiently and to allow us to offset the other investments we’re making,” chief people office Janelle Gale told employees, according to the memo. “This is not an easy tradeoff and it will mean letting go of people who have made meaningful contributions to Meta during their time here.” Meta spent tens of billions on its metaverse efforts, which largely failed. The company has also had to make major investments in its AI efforts in order to keep up with competitors in the space — earlier this month, it debuted a completely overhauled AI product called Muse Spark. Still, the firm’s stock is up 118% over five years and fell just 2% on the news.

Trumplandia

“You’re Fired”: Donald Trump, Jr. fired former GOP congressman Devin Nunes as head of the family’s Trump Media & Technology $DJT ( ▲ 0.71% ) . Nunes said it was “an appropriate time” to leave the firm. Last year, Trump Media lost $712 million on $3.7 million in revenue, and the company says it's now planning to merge with a nuclear fusion company. Shares have lost 85% of their value in the last two years.
Names on Things Dept.: When a family of Syrian-born investors won $12 billion of Syrian government contracts to rebuild the war-torn country, including a luxury seaside development, they were blocked by one thing: U.S. sanctions imposed on the country during the rule of its former despot, Bashar al-Assad. The solution? Propose a Trump-branded resort and golf course. (The brothers are also negotiating a Trump-branded resort in Albania with Jared Kushner). The Trump Administration says no talks on a Trump-branded Syrian golf course are under way, but shortly after the Syrians, the al-Khayyat brothers, met with Trump-adjacent lawmakers in Washington, the president signed a bill lifting the sanctions.

Elon’s World

Taken for a Ride: that’s the claim of tesla $TSLA ( ▲ 3.17% ) owners who are increasingly frustrated by the slow pace of the EV maker’s transition to full self-driving mode. Now these peeved drivers are suing Tesla in a class-action suit that claims Tesla sold them — and has been charging the monthly subscription fees for — a product that doesn’t exist. One key claim: Tesla’s Hardware 3, the onboard computer sold though 2019 and meant to eventually drive the car, is already outmoded, and will never run full self-driving software. Owners in Australia and Europe are preparing similar suits, reports the Wall Street Journal.
Cursory glance? SpaceX said Tuesday it will pay up to $60 billion for a four-year-old AI code-writing startup called Cursory. SpaceX is prepping for an IPO this year that could value the company at over $1 trillion, and it seems an odd fit for a rocket company. But in February, SpaceX bought Musk’s xAI, and one plan for his rockets is to launch orbiting AI data centers. Still, investors wonder if Musk has shifted SpaceX’s priorities away from getting humans to Mars.
Elon and Sam’s Big AI Feud Goes to Discovery: The law of unintended consequences is at its worst when it comes to lawsuits. Now that Elon Musk is suing Sam Altman for turning OpenAI into a profit-making company, all kinds of goodies are coming out, as the Washington Post reports in a solidly reported and delicious article that includes such gems as texts of Musk and his romantic partner Shivon Zilis discussing how she can best work for him inside OpenAI. Likewise, as Musk’s team of DOGErs took a chainsaw to the Federal government, Meta’s Mark Zuckerberg texted Musk to know he’s had Facebook’s security teams censor some doxxing of DOGE. Musk responds with a heart emoji, and then Zuck, apparently concerned he’s put a little too much in writing, asks Musk “Want to discuss live?”

Want more Cheddar?

Just How Big A Threat Is AI to Global Finance?

Cheddar's Big Business This Week — Thu, 16 Apr 2026 20:30:00 +0000

(Getty Images)

When Treasury Secretary Scott Bessent (above) and Fed chair Jay Powell jointly summon America’s top bankers to a meeting in Washington, you know it’s big. This time, it was over the specter of a new AI model created by Anthropic, called Mythos. If that sounds like a black-masked, sword-wielding supervillain, then it has a great name, because that’s what it sorta is.

Before its public release, Mythos was let loose on the software running some of the biggest U.S. banks and it found flaws, faults and backdoors that had sat undiscovered, and uncorrected, for decades.

Details of the closed meeting last week are scarce, but President Trump’s chief economic adviser, Kevin Hassett, told Fox News the Administration is “taking every step we can to make sure that everybody is safe from these potential risks, including Anthropic agreeing to hold back the public release of the model until our officials have figured everything out. There’s definitely a sense of urgency.”

Anthropic is milking the supervillain for all its worth. It changed the model’s name from its original Capybara, an oversized, lovably cute South American hamster, and said it won’t release Mythos until a group of about 40 tech firms, including Apple, Amazon and Microsoft, get to use the model to scout for potential security breaches, and “give good actors a headstart.” It’s calling the group “Glasswing,” and offering $100 million in Claude usage credits to the project. But how serious a problem is it? Big Business This Week columnist Peter Green spoke with some cybersecurity experts to learn more.

“AI is becoming a very credible opportunity/threat to the financial system,” said Jim Taylor, president and chief product and strategy officer at RSA Security, a respected internet security firm. AI is “industrializing” the speed and frequency of fraudulent transactions, way faster than banks and businesses can keep up.

A recent survey by tech consulting firm SAS found that 47% of banks are caught in what the firm calls a “trust dilemma,” either deploying AI they haven’t fully validated or holding back AI they’ve validated and trust. More than the technology itself, the lack of people and procedures to manage the overnight growth of AI is what many regulators increasingly view as a systemic risk, the preparedness gap the Treasury and Fed are concerned about.

The other big problem, said Taylor ,is the way AI is getting incorporated into the global financial system. “It’s automation, it’s cheap, it’s better, it’s easier and more effective than a human. But if you start to rely on those AI models, the models themselves become a risk: what if those models are manipulated or they’re simply wrong?”

The big question, and what was probably behind the Washington convocation, said Taylor, was concern about how much knowledge banks have to understand and limit the risks of the AI they are incorporating at record speed.

“The Mythos announcement, there's a fair amount of hype around it,” said Jeff Williams, chief information security officer for Sigma 360, which provides compliance software to large financial institutions. Other AI models, some far simpler and less expensive to run than Mythos, have already found and exploited major security flaws, he said, putting hacking tools within reach of almost anyone with ill intent.

“That means that the barrier to an attack is suddenly lower,” Williams said. “How much lower is open for debate,” but he noted, “the fundamentals of security haven't changed.”

That’s where security experts agree: credentials, identification and privilege go by many names, but the key to IT security is to ensure that only authorized users are entering your system. AI makes that a lot harder. It can gather hundreds of data points from confirmed users, everything from their syntax to their location or even their typing patterns, and fake their way into the system, erasing databases or diverting funds into fake bank accounts with fake invoices.

“We need to operate from a principle of least privilege,” said Williams. “We need to control our systems in a meaningful way so that they're only doing the things that they're supposed to do, that we can see that they're doing them correctly.”

The lesson for defenders is that if attackers can move that fast, defenders have to move even faster, and that’s a problem for many large corporations, added Walker. “Legacy compliance tools and security tools aren't very well positioned for this increased pace. It takes a move to continuous compliance operations that leverage AI. That gap is not just technology, but also the people and process behind it, have you built a cadence that will allow rapid response to emerging threats.”

That capacity will take time to build, training people in new work methods, and creating roadmaps to speed the defense against AI-run hacking.

One interim solution, that may prove most durable, is to wall off key data on a server that is only reachable via what’s called an “air gap,” physically disconnecting from the internet, and using non-digital means to keep the data isolated.

“AI can’t circumvent physics,” said Tony Hasek, CEO of Goldilock Secure, a new NATO-standard air gap database protection device used by some U.K. utilities. “The databases are physically disconnected,” explained Hasek. “Since the AI can only operate with Internet Protocol, if access to the databases is triggered by methods that don’t use the internet, there’s no way for the AI to break in.”

The weakest point in the armor around the financial system and its data are humans, says Shai Gabay, founder of Trustmi, a New York-based cybersecurity firm focused on countering AI identity fraud. AI gets better by the day at social engineering, detecting and duplicating the bits and pieces that make up a person’s online identity. “Attackers understand how companies actually operate, and they’re using that to slip through gaps that tools were never designed to catch,” Gabay said. “The one thing that you cannot fix, it’s not software vulnerabilities, it's the human beings, and that's why social engineering is very effective because it's targeting the human being behind the computer.”

The problems need to be solved soon, to prevent the erosion of public trust in the banking system. “AI failures can undermine trust far faster than traditional risks, because flawed models, biased decision logic and ungoverned automation don’t remain isolated. By their very nature, these failures can cascade across customers, counterparties and markets in real time,” said Stuart Bradley, senior vice president for fraud and security intelligence practices at SAS, the data security consulting firm. “The potential for a sudden loss of confidence cannot be understated in today’s digital‑first financial system, where bad news spreads like wildfire and customers can move their money in an instant.”

That, says Goldilock’s Hasek, means globally regulators and financial institutions will need to work together to keep an eye on how AI is used.

“Everybody has to be willing to regulate it, because if one venue doesn’t regulate it,” he said, “we may be in deep trouble.”

—Peter S. Green

Big Businesses mentioned this week:

$DIS ( ▼ 0.55% ) $AMZN ( ▲ 1.4% ) $GOOG ( ▼ 0.69% ) $FLYYQ ( ▲ 33.33% ) $TSLA ( ▲ 3.17% ) $BIRD ( ▼ 0.29% ) $SNAP ( ▲ 1.51% ) $PTON ( ▲ 2.77% )

This week, big business!

War story
The usual suspects
The short stack
Trumplandia

War story

It’s open, it’s not open. Whatever is happening with the blockade of the Strait of Hormuz, one thing is for sure: Oil, fertilizer and chemicals are not getting to market, and the price of these basic building blocks of the global economy is hurting everyone (except maybe the arbitrageurs). Up next: Farmers. Across the globe, fertilizer shortages and resultant price hikes are upsetting the delicate calculus farmers use to decide what crops to plant. A survey this week showed 78% of farmers in the U.S. South can’t afford all the fertilizer they need. So many are dropping corn and switching to less fertilizer and energy intensive crops, like soy beans. As one farmer told CNBC: “We are paying input prices of 2026, but getting crop prices of the ’70s and ’80s.” Except for tomatoes: Fresh tomato prices jumped 15% last month to an eight-year high, mostly due to tariffs on Mexican tomatoes and higher energy costs. Time to plant a Victory Garden?

Global growth drop? With oil prices bouncing around $95 a barrel for global benchmark Brent Crude, up nearly 50% since before the war began on Feb. 28, it’s unlikely that prices will fall much lower anytime soon. And that’s bad news for the global economy, says the International Monetary Fund., which expects global growth to drop to 3.1% this year from a previous forecast of 3.4%. If the war drags on, global growth could drop to 2% and send inflation up to 6%. It predicts U.S. growth will drop to 2.1% from January’s forecast of 2.4% this year. The U.S. Bureau of Labor Statistics said March inflation hit a 3.3% annual rate, up from 2.4% in February, before the war started, with the national average for a gallon of gas hitting $4.11 this week.

(Google)

Markets Drinking Kool-Aid? None of this has hurt the stock market, which just keeps climbing. On Wednesday, the S&P broke 7,000, setting a new record, even as the U.S. Navy began stopping some ships from transiting the strait,and Iranian forces keep hundreds of tankers bottled up in the Persian Gulf, unless they pay a dollar-a-barrel toll. It’s hard to know what’s keeping the market booming, but there are some indicators: corporate profits are still going strong, and whatever happens in Iran, investors are clearly counting on TACO - believing that with mid-term elections coming and his favorability rating in the basement (56% of American disapprove of the job he’s doing), Trump won’t risk more war. But maybe it’s the employment numbers that are helping out. JPMorgan Chase CEO Jamie Dimon said Tuesday, “The most important thing is jobs, and there are plenty of jobs.” But former Fed and Bank of America economist Ethan Harris says markets aren’t pricing in the real risk that high oil prices are here to stay, noting that countries that are shut off from Gulf oil and gas will soon be buying from the U.S., pushing domestic oil prices closer to world levels, meaning we are closer to a recession than it may appear. “I’m not drinking the Kool-Aid,” he wrote in a blog post this week.

The 10 Best Cheap Stocks to Buy Now

The market is expensive… historically expensive.

Most of the biggest stocks are already fully priced. Capital has crowded into the same mega-cap names — making true value harder and harder to find.

By early 2026, institutional money had stayed concentrated. Smaller companies had been overlooked. And beaten-down names had been left behind.

But here's the real question…

When the broader market is this expensive — which stocks are still cheap enough to offer real upside?

Our new report reveals 10 undervalued stocks trading under $10 per share — from companies too small for institutional money managers to touch… to out-of-favor names already working their way back.

If you're looking for real value in an overpriced market, start here.

View The 10 Stocks Now

END OF ADVERTISEMENT

The usual suspects

Evictions at the House of Mouse: New Disney $DIS ( ▼ 0.55% ) CEO Josh D’Amaro says he’s laying off 1,000 more Disney mice as he consolidates the company’s multiple marketing arms in a single division. That comes after former CEO Bob Iger sacked about 7,000 Disney employees since he came back to the company in 2022 and began a major realignment of the business. Disney had about 230,000 employees at the end of last year, so the cuts may appear small, but the company is struggling to cope with shrinking revenue in TV (streaming is not making up for the fall-off in TV viewers) and with competition from Amazon $AMZN ( ▲ 1.4% ) and Alphabet-owned $GOOG ( ▼ 0.69% ) YouTube. Shares in Disney are up 12% since a March 27 low, when investors appeared to buy the dip after Barclays upgraded the stock, amid hopes for a new "Frozen” attraction at Disney theme parks.
Dead Spirit? That’s all she wrote, folks. Spirit Airlines $FLYYQ ( ▲ 33.33% ) could be liquidated as early as this week, according to CNBC, citing people familiar with the situation. Despite givebacks by union pilots and flight crews, rising fuel prices, shrinking margins on barebones economy seats and a foiled merger with Jet Blue left Spirit nothing to hang on wth. Spirit had forecast a $252 million profit last year, but by August said it had lost nearly $257 million in less than four months, after exiting Chapter 11 bankruptcy in March. It filed for Chapter 11 bankruptcy protection again less than a month later. “We don’t comment on market rumors and speculation,” Spirit said in a statement.
Jeff and Elon’s Big Satellite Battle: It seems like Jeff Bezos is having a case of satellite envy. With Starlink chief Elon Musk having launched more than 1,100 satellites for his Starlink network, Bezos’ is scrambling to get Amazon’s own satellite comms system in orbit while he can still compete. With only 27 sats in place so far (admittedly, they are a lot bigger than Starlink ones) Bezos’ has been looking for quick fixes, and he’s found one with Globalstar, which has 24 satellites. Amazon will pay $10.8 billion for the new space toys.
Place your bets. Kalshi and Polymarket, both of whom have hired Donald Trump, Jr. as an advisor, are facing off against Congress as legislators agitate to more closely regulate the online prediction businesses. By structuring their deals as contracts, rather than as bets, the two companies say they’re governed by the Commodity Futures Trading Commission, which also governs futures contracts (or bets) on real deliverables like pork bellies and gasoline. Instead of betting on a sports game, for example, you invest in the outcome. Senators don’t like the prediction markets betting on wars, and casinos and licensed sports books say the companies are eating into their businesses. The two firms are beefing up their lobbying, having spent a collective $1 million in Washington last year.
If you can’t trust the NFL… Football may be one of the most competitive games on the planet, but the Justice Dept. says it’s investigating anti-competitive practices by the NFL. The topic is broadcasting games, and the DoJ says it’s got questions about “affordability for consumers and creating an even playing field for providers,” according to an unidentified DJ official speaking to CNBC. The league said 87% of its games can be seen for free on local broadcast TV channels. Meanwhile, a poll by Sacred Heart University shows Americans don’t have much trust in the NFL, with only 31.7% calling it the league they trust most not to let betting influence games.
You know it’s a bubble when… What do you do when you’ve run your $4 billion footwear firm into the ground? Pivot to AI. That’s what failed shoemaker Allbirds $BIRD ( ▼ 0.29% ) , a one-time Silicon Valley sartorial standard, just did. Two weeks ago, Allbirds sold its IP and remaining assets for $39 million. After kicking off its kicks, Allbirds’ share price jumped from $3 to $17 this week, on word it’s entering the AI compute business, leasing GPUs, hardware and access to smaller companies. It’s rebranding itself as “NewBird AI.”

Is Detroit back - With drones? Facing a long-neglected drone gap with adversaries like Iran, Russia and China, the Pentagon is starting to wise up, and has approached U.S. automakers about becoming armsmakers. Already, drone startups are relocating to Detroit, with its cheap office space, reusable factory buildings, and cheap housing. They are also finding car parts suppliers with spare manufacturing capacity, and machinery that can easily be reconfigured to mass produce drone parts. The idea is not new. During World War Two, GM $GM ( ▲ 0.54% ) became the world’s largest arms maker, churning out more than 6,000 Cadillac-made tanks, and 13,000 Navy airplanes.
Oh, Snap! Blame AI for this one: Snapchat parent Snap $SNAP ( ▲ 1.51% ) , says it’s laying off 1,000 people, or 16% of its global workforce because of AI-generated efficiencies. Shares were up nearly 8% by day’s end Wednesday, but Snap’s lost more than 90% of its market cap in the past five years. AI agents are already generating over 65% of Snapchat’s new code and responding to over 1 million queries per month. Snapchat is also getting squeezed by deeper-pocketed social media rivals. Facebook, Instagram, YouTube, and TikTok capture over 90% of social media ad spending, according to data firm Omdia.

The short stack

Peddling a new Peloton: New CEO Peter Stern is planning to expand Peloton $PTON ( ▲ 2.77% ) from the ridiculed exerbike of choice to a full fitness brand with exercise equipment for gyms and AI-curated exercise routines. Stern says most of the Peloton users who bought bikes during the pandemic are still using them. Still, shares are down 96% since their pandemic-era high.
The annoyance economy: All that time you spend on hold talking to helpline bots, trying to fill out an insurance claim form, make a doctor’s appointment or place an online order? Well, a new study by policy wonk Chad Maisel and Stanford econ prof Neale Mahoney has put a number on what they call the waste of the “Annoyance Economy.” It’s $165 billion a year! Their solution: better regulation that restricts monopolies and re-awakens competition and consumer protection. Good luck with that.

Trumplandia

The Apprentice, Fed Chair edition. The clock is ticking on Fed chair Jerome Powell’s tenure, but the GOP-controlled Senate seems uninterested in resolving the question of who’s going to replace Powell when his term expires on May 15. President Trump’s nominee, the Kevin named Warsh, the gazillionaire son-in-law of Trump buddy and cosmetics heir Ronald Lauder, is stuck in committee, as Banking Committee member North Carolina Republican Thom Tillis says he won’t approve any nominee until the Trump Administration ends its investigation of Powell for the over-budget and over-schedule renovation of the Fed’s D.C. headquarters. Earlier this week, Justice Dept. investigators made an unannounced visit to the construction site, and now even Senate Majority Leader John Thune says it's time for Trump to drop the probe, widely seen as an effort to intimidate Powell. Trump wants to install Warsh, who says there’s room to lower interest rates, a Trump priority. But Warsh may face further hurdles over his $130-million-plus personal fortune, which he’d have to divest or put in a blind trust. Senators from both sides say they’ll grill him on how he’d secure the Fed’s congressionally mandated independence in the face of Trump’s rate rage. Meanwhile, Trump said he’d fire Powell if the chair stayed on beyond May 15. Law and custom say the Chair goes only once his successor is appointed, so expect quite a showdown as the Senate gets back in session.
Oil Insiders? Remember those curious oil futures and S&P trades last month just minutes before President Trump announced a ceasefire with Iran that sent the markets reeling? Well, the Commodities Futures Trading Commission says it's looking at trading platforms run by CME Group and Intercontinental Exchange, asking them to turn over records. Regulators want Tag 50 identifiers on a number of trades. Now called operator IDs, they show which individual or account made a trade on a futures exchange. CME shot back, saying it works with the CFTC, but said any review should include those prediction markets, Kalshi and Polymarket.

The Great Iran War Supply Chain Disruption

Cheddar's Big Business This Week — Thu, 09 Apr 2026 20:30:00 +0000

(Getty Images)

The ripple effects of the Iran War go beyond oil tankers and the Strait of Hormuz, affecting global supply chains for everything from semiconductor components to ice cream. To understand how these disruptions are playing out in real time, BBTW columnist Peter Green spoke with Razat Guarav, CEO of Kinaxis $KXS.TSX ( ▲ 0.32% ) whose platform helps companies manage more than $200 billion in inventory across global supply chains. (This interview has been condensed and edited for clarity).

For readers who may not know Kinaxis, what do you do, and how does that give you visibility into what’s happening now?

“We are a global leader in helping provide a platform for supply chain planning and decision making. We work across seven verticals with companies like Unilever $UL ( ▼ 1.38% ) and Ford Motor $F ( ▲ 0.82% ) and Merck $MRK ( ▼ 0.73% ) and Qualcomm $QCOM ( ▲ 2.44% ) . We help them with forecasting their demand, planning their supplies, planning their inventories, planning their production, and we’ve got a platform that understands the physics of the supply chain and how the different elements are interrelated.”

When people think of the Middle East, they think oil. What are they missing?

“The Strait of Hormuz controls roughly 20% of the world’s oil, but also a lot of the liquid natural gas supply. Qatar supplies more than 20% of the world’s LNG, and a lot of that goes through the Strait of Hormuz. And then the Middle East has some important air cargo hubs: Dubai, Abu Dhabi and Doha. It’s not just passenger movements, but also air cargo. So that impacts flows between Asia and Europe, not just to the Middle East.

What are some less obvious goods being disrupted?

“The Gulf region is one of the world’s largest suppliers of sulfur that goes into fertilizers, and a lot of the silicone that goes into chip making comes from the Middle East. Then there are some items like dates and Dubai chocolates. There’s a lot of water supply that goes in on tankers into the Middle East that has been impacted as well. And ice cream.”

Ice cream? What does that tell us about modern supply chains?

“We’ve got customers in the food and beverage industry. They make ice cream in Turkey and then ship to Saudi Arabia or the UAE, frozen in temperature controlled containers. Summer is around the corner in the Middle East, and there's a high correlation to demand for ice cream with changing temperatures. That has been disrupted.”

How are companies responding in real time?

“Since the war started, we’ve seen a 30-35% increase in the number of scenarios being run on our platform. Some of our customers are moving things not through the ports in the Middle East, but around into ports in Africa and then going around the Cape [of Good Hope]. That extends the lead times and it also adds costs: transportation, logistics costs, inventory, carrying costs.”

How much inventory cushion do companies really have?

“It varies by industry. If you’re talking about perishable food products, they have very short buffer inventory because they’re perishable. In automotive just-in-time inventory, you’re dealing with two to three days all the way up to maybe a week and a half, at most. You don’t want to carry too much inventory.”

How does this disruption compare to COVID or the Red Sea crisis?

“It’s definitely not as widespread as COVID, when the entire world was on lockdown. This is impacting product flows in and out of the Middle East so it's a more regional conflict, but it’s more chronic than the Red Sea issue.”

If this conflict isn’t resolved soon, what changes permanently?

“No one is clear around how long things are going to last. Organizations are looking for alternatives, substitute sources of supply, rerouting things. This has led them to rethink their product flows and be a lot more deliberate about looking for optionality.”

So this could become a lasting structural shift, not just a temporary disruption?

“I think this is going to have a longer impact than just the end of the war, in terms of how product flows organize themselves. People are going to be de-risking choke points that have been exposed.”

—Peter S. Green

Big Businesses mentioned this week:

$KXS.TSX ( ▲ 0.32% ) , $UL ( ▼ 1.38% ) , $F ( ▲ 0.82% ) , $MRK ( ▼ 0.73% ) , $QCOM ( ▲ 2.44% ) , $UAL ( ▲ 2.24% ) , $JBLU ( ▲ 6.09% ) , $DAL ( ▲ 2.21% ) , $LUV ( ▲ 1.15% ) , $AC.TSX ( ▼ 0.08% ) , $UMGP ( 0.0% ) , $SPOT ( ▲ 0.14% ) , $BRK.B ( ▲ 0.13% ) , $JPM ( ▲ 1.47% ) , $AMZN ( ▲ 1.4% ) , $SBUX ( ▲ 2.45% ) , $STLA ( ▼ 1.3% ) , $HSY ( ▼ 1.58% ) , $PSKY ( ▼ 4.31% ) , $BAC ( ▲ 1.63% ) , $C ( ▲ 1.59% ) , $GS ( ▲ 2.56% ) , $MS ( ▲ 1.86% )

This week, big business!

War story
The usual suspects
Car talk
Want more Cheddar?

War story

Deal/No Deal? The shaky truce announced by Iran and the White House earlier this week has set off another roller coaster ride for markets and energy prices, with Brent Crude oil dropping from $111 to $90 a barrel on the news, then rebounding back to near $100 with stock index rallies stalling after Iran claimed the ceasefire had been broken. Irrational exuberance, or just the winds of war? Either way, we are in for a long period of financial and business uncertainty as the world adopts to a new normal. Iran’s promise to let friendly boats through the Strait of Hormuz for a fee should begin to relieve some pressure on oil markets in the medium term, but the Gulf nations will take a year or more to rebuild their damaged refineries and LNG platforms. That means inflation is likely to stay at or above 3% for the rest of the year, reducing the chance of any significant rate cut by the Fed, no matter who is running it.
Making book: Less than three hours before President Trump announced he’d reached a “two-sided” ceasefire deal with Iran, unidentified traders made a $950 million bet on oil prices falling, the largest wager on oil yet ahead of a major policy announcement by Trump, Reuters reported. According to London Stock Exchange Group data, traders sold a combined 8,600 lots of Brent and U.S. crude futures 2 hours and 45 minutes before Trump’s announcement. Market watchers are picking up other trades tied to the announcement, including a reported $51 million trade on oil that marks the 16th time the same unidentified investor has reportedly traded successfully ahead of a Trump announcement.

Rising oil prices have airlines tacking on fuel charges of $10 or more for passengers. Some airlines, including United $UAL ( ▲ 2.24% ) and Jet Blue $JBLU ( ▲ 6.09% ) , Delta $DAL ( ▲ 2.21% ) and Southwest $LUV ( ▲ 1.15% ) are adding the surcharge for checked baggage, while others are adding a fee to longer trips. Air Canada $AC.TSX ( ▼ 0.08% ) is adding a $50 fee for flights to warm-weather destinations. Jet fuel costs have nearly doubled from $2.42 a gallon before the Iran war to $4.16 on April 8, according to Argus Media. That hasn’t hurt Delta, which said this week that even after spending $2 billion extra in fuel in the second quarter, it expects profits to grow 10% to about $1 billion.
California Nightmaring: The Iran War is hitting in an unexpected place: California, which gets about 25% of its crude oil from the Middle East, and a lot of its refined jet fuel and gasoline from Asian countries that get their oil from the Persian Gulf. Key jet fuel supplier South Korea is halving the amount of fuel it sends to California to cope with a supply crunch at home. Gasoline prices in California, where taxes add $1.10 to every gallon, broke $6 a gallon, the highest by far in the U.S.

(X.com)

The Nuclear Option: Governments across Asia are planning to reopen or rebuild shuttered nuclear power plants as the Iran War and its aftermath show the dangers of depending on imported LNG to power their countries. South Korea’s planning to rush the refurbishment of 10 nuclear plants, and Taiwan is reversing a no-nukes policy adopted after the 2011 Fukushima nuclear power plant disaster in nearby Japan. And Japan is changing rules to allow shuttered nuclear plants to restart. In fact, 38 countries have signed on to a plan to triple global nuclear energy capacity by 2050.

Stack BTC while you sleep

Tired of trying to time the market? YieldClub puts your money on autopilot. Deposit from your bank account, and your balance starts earning automatically, routing yield into Bitcoin around the clock. No charts, no timing the market, no crypto expertise required.

Start Stacking BTC

END OF ADVERTISEMENT

The usual suspects

Ack attack: Bill Ackman has offered $64 billion for Universal Music Group $UMGP ( 0.0% ) , the home of Taylor Swift, Bad Bunny and Kendrick Lamar, with 30% of the global music market. Ackman’s Pershing Square Capital values Universal at a 78% premium to its share price before his offer, but the financing of it is complex, and would include Universal selling its roughly 3.5% stake in Spotify $SPOT ( ▲ 0.14% ) . Ackman has been trying to squeeze value out of UMG for a while, and key to his plan is bringing the company from Amsterdam to the New York Stock Exchange, where it would be eligible for inclusion in the $SPX ( ▲ 0.81% ) , forcing “many more top” index funds to buy it. Ackman told investors he sees stock quadrupling in value in five years. Ackman would leave leadership at Universal unchanged, but bring in former Hollywood super agent Moichael Ovitz as board chair. Markets failed to share his enthusiasm, as Universal’s share price rose just 16% after the announcement.

(X.com)

Shine on, you crazy Dimon. Ever since Warren Buffett sent the last of his 60 annual folksy letters to Berkshire Hathaway shareholders $BRK.B ( ▲ 0.13% ) in 2024, the investing world has been looking for its next epistolary oracle, and it may have found him in JP Morgan Chase’s $JPM ( ▲ 1.47% ) F-bomb-tossing CEO Jamie Dimon. Dimon has called the folks behind a weakening private credit market “cockroaches” and now he’s warned in his most recent letter to shareholders, that inflation going up slowly could be “the skunk at the party.”
Amazon’s Postal cuts get cut: Jeff Bezos’ Amazon $AMZN ( ▲ 1.4% ) has scaled back its threat to all but abandon using the U.S. Postal Service for “last mile” delivery of its packages. Now, Amazon will cut the number of packages it ships using USPS by 20%, rather than the 65% reduction announced in March. Last year, Amazon accounted for 15% of all package revenue earned by UPS $UPS ( ▲ 0.73% ) , or about $6 billion. Fedex $FDX ( ▲ 0.35% ) and UPS have both cut back on delivering for Amazon, which in some areas has its own, competing, package delivery business.
That tip jar at Starbucks $SBUX ( ▲ 2.45% ) X just went from grande to venti. In an effort to boost employee pay without cutting into its own bottom line, Starbucks says it plans to give more customers a way to leave a tip when paying by credit or debit card. It also says it's offering new $300-a-quarter bonuses for top-performing baristas. Meanwhile the Seattle-based coffee brewer has yet to reach an agreement with the Starbucks Workers United union representing about 600 of its 10,000 U.S. stores. The union wants 4% annual raises along with better pay and better protections for baristas, which would cost a lot more than giving quarterly bonuses to top performers.
Who’s got the power on TV these days? NFL Commissioner Roger Goodell. Pro sports are one of the few bright spots in linear TV programming these days, drawing massive live audiences, and the advertisers and profits that come with them. The NFL currently gets about $10 billion in revenue from TV rights sold to networks and streaming firms, but Goodell knows he is in the catbird seat, and is hoping to boost that to $16 billion, reports Puck. The NFL is looking at the NBA, which has been boosting its TV revenue, and the recent Paramount Skydance $PSKY ( ▼ 4.31% ) merger will let Goodell re-open the NFL’s current contract with CBS. The net result? Analysts say networks will be spending less money on other programming as they compete for live sports deals.
Ready for your closeup Mr. Altman? If you’re still wondering how stable the AI boom is, here’s another straw to add to the camel’s back. OpenAI CFO Sarah Friar says the company is not ready to go public this year, The Information reports. That’s because she’s not sure the company can count on enough revenue to support its spending commitments. Oops. OpenAI CEO Sam Altman says the firm is still on track for the IPO, so the dissonance is even more acute. Meanwhile, Altman told investors (according to The Information's, er… information) OpenAI keeps having to buy extra computing capacity to meet chatbot demand, but as it buys more, its margins keep shrinking. Why? Because it can’t charge clients enough to cover its costs. So, we asked ChatGPT whether OpenAI ever become profitable? The answer: Unlikely. “The question is not “can they make money?” It’s can they make enough money to outrun their costs? The real issue: compute costs are enormous. This is why even strong revenue growth still leaves them deeply unprofitable.” From the mouths of (robot) babes, eh?

Car talk

Is Chrysler fading out? Is this the end for Chrysler, the automaker that President Jimmy Carter bailed out in 1979, making then CEO Lee Iacocca a household name when he paid back the loans? Well, at the recent New York Auto Show, the perennial number three Detroit automaker was down to just one model in its lineup - the Pacifica minivan. Chrysler’s been tumbling downhill since it went bankrupt in 2009 and was sold to Italy’s FIAT. Last year, it sold a mere 126,000 cars. Chrysler parent Stellantis $STLA ( ▼ 1.3% ) (FIAT merged with Peugeot and rebranded) lost $25 billion last year, which suggests there may not be a knight out there galloping to Chrysler’s rescue. Stellantis shares are down 73% from their all-time high two years ago.
(Giphy.com)
Trump to Ford: Drop Dead. The Trump Administration is turning a deaf ear to calls from Ford $F ( ▲ 0.82% ) to drop imported aluminum tariffs until the fire-damaged New York factory that churns out the aluminum sheet for exterior panels of the best-selling F-150 pickup. Ford says the 50% tariffs on replacement sheet metal will cost it $3 billion by the time the plant is back online in June.

Want more Cheddar?

"Stocks will crash," says one expert; "Stocks will rise," says another 🤷

Cheddar's Big Business This Week — Thu, 02 Apr 2026 20:30:00 +0000

(Getty Images)

The war in Iran continues to wreak havoc on market stability. Every week since the war began, the markets rise on a Monday, buoyed by hopes the bombing will end soon, but by Friday they come crashing down again. With headlines the main impetus, investors and traders appear to be selling to lock in profits and avoid getting caught by a weekend’s worth of bad news. Since the war began the S&P is down about 5%, the Dow is down 6%, and the Nasdaq is down about 1.3% The latest iteration came with President Trump’s Wednesday night speech that investors and others hoped would signal an end to the U.S. bombing campaign on Iran and a reciprocal end to Iran’s threats to ships transiting the Strait of Hormuz, where 20% of the world’s oil, and most of the LNG that supplies Europe and Asia pass.

Instead, Trump doubled down on his threats against Iran, and produced no clear plan for reopening the Strait. That’s given Iran leverage. It’s now letting ships owned by its allies go through without paying tolls. Since March 1, 71% of ships that have passed through the strait are owned by Iran, coming or going from Iranian ports, or part of the sanctions-busting shadow fleet carrying Iranian oil, Lloyd’s List Intelligence said this week. That’s fewer than a dozen ships a week right now, compared with 700 - 900 a week before the war. That leaves oil prices above $100 a barrel, up about 46% in the past month, gasoline up 30% to over $4 a gallon and likely to stay there, and in Europe, LNG prices are up 35%.

(Google Nano Banana Pro)

Then there’s the coming food crunch. A third of the world’s fertilizer, made with natural gas, comes from the Gulf, and it's stuck behind the strait. Rising gas prices in Europe have stopped production there. Already, U.S. farmers are planting less corn, and looking to Washington for help, after Trump’s tariffs slashed soybean exports, and won farmers $12 billion in aid. And rising diesel prices mean U.S. food distributors are adding a fuel surcharge to deliveries, driving up consumer costs.

So what’s an investor to do? Big Business This Week caught up with a naysayer and a yaysayer about the stock market, to see if we could make head or tail of the situation.

Michael Klein, a professor of international economics at Tufts University, and editor of the Econofact website, says the global economy may be at a “tipping point.” The canary in the coal mine? The CAPE ratio, (Cyclically Adjusted Price-to-Earnings), which divides a stock index's current price by the average of its inflation-adjusted earnings over the past 10 years, smoothing earnings volatility to identify if a market is over- or undervalued. Right now, he noted that the ratio is at 37.9, and the last time it was that high was just before the technology crash of 2000.

“I moved a lot of my money out of stocks at the end of the last year, looking at that CAPE ratio,” Klein said in an interview. While it may look safe now, he says, tariffs, the wars in Iran and Ukraine, and labor force issues caused by the U.S.immigration crackdown have created a level of uncertainty that has likely created a new cycle of business conditions that we can’t yet understand. Citing the famous dictum of MIT economist Rudy Dornbusch, Klein noted that “crises take longer to occur than you think.”

But Michael Grant, co-CIO at Calamos Investments, with $48 billion under management, says that if the U.S. markets were really overvalued, the so-called rotation trade, moving away from high price-to-earnings ratios among the MAG7 to lower-valued stocks and foreign equity markets, would be thriving. That’s not the case, he says. “Since the inception of Epic Fury, the comparative defensive qualities of U.S. benchmark indices have been unmistakable,” he wrote in an email to BBTW,noting that the dollar has “reasserted its reserve status,” after the Euro peaked at $1.205 on January 27. Now, he said money that moved to Europe is coming back, as the war showed how vulnerable Europe’s economy is to global shocks.

Instead, he added in an interview, business fundamentals in the U.S. are still strong, and business’s reaction to Trump’s uncertainties have actually helped build the U.S. economy. “Certain types of uncertainty are actually supporting the economy,” he said, as tariffs forced managements to say we have no choice but to build and produce close to where we sell. “That's reflationary support. Same with geopolitics: one thing we have certainty about is that these types of geopolitical frictions will persist, so we have to invest in the military.”

One exception: Tech firms like the MAG7, have changed from cash-flow cows whose share buybacks justified their sky-high valuations, to capital intensive manufacturing companies, building out massive investments in AI, with data centers, energy plants, and chip production.

So how long will markets stay investible with all the uncertainty?

“A lot of the uncertainties can get juggled as long as they stay in the air, but if we get hit with a recession while oil prices are up, we’ve got big problems,” Grant said. “Right now, the markets are saying that the odds of Hormuz opening soon are better than the odds of a U.S. recession. If that ever changes we have trouble.”

—Peter S. Green

Big Businesses mentioned this week:

$PSKY ( ▼ 4.31% ) $WBD ( ▲ 1.84% ) $UL ( ▼ 1.38% ) $MKC ( ▼ 0.06% ) $MICC ( ▲ 0.07% ) $OWL ( ▲ 0.65% ) $BX ( ▲ 2.98% ) $APO ( ▲ 1.44% ) $ARES ( ▲ 3.1% ) $BLK ( ▲ 2.96% ) $CMCSA ( ▲ 0.67% ) $VSNT ( ▼ 0.53% ) $NFLX ( ▼ 0.16% ) $GOOG ( ▼ 0.69% ) $AMZN ( ▲ 1.4% ) $HSY ( ▼ 1.58% ) $SYY ( ▼ 1.37% ) $BF.B ( ▼ 2.17% ) $BIRD ( ▼ 0.29% )

This week, big business!

The usual suspects
The tech stack
Want more Cheddar?

The usual suspects

Misewable wabbit! The race is on to kill Paramount Skydance’s $PSKY ( ▼ 4.31% ) $110 billion purchase of fabled Hollywood studio Warner Bros. Discovery $WBD ( ▲ 1.84% ) , along with broadcast and streaming assets that include HBO Max and CNN. Who will get there first, anti-trust regulators or the market? Despite the full throated endorsement of President Trump’s FCC chair, Brendan Carr, who called the acquisition “a good deal,” that “should get through pretty quickly,” Trump said the Dept of Justice would make the final call, and now the DoJ has subpoenaed Paramount and WBD. Trump fired Attorney General Pam Bondi shortly before press time, too, which means the works could be gummed up even further. Promising that there will “absolutely not” be politically motivated fast-track approval of the deal, federal trust-busters want to know how the deal could affect studio output, movie theaters, content rights, and competition among streaming services, CNBC reported. Anti-trust attorneys have also asked independent film producers to weigh in, and the Teamsters Union has urged the feds to block the deal unless it can find an enforceable way to protect jobs. That’s after Paramount owner David Ellison said he sees as much as $6 billion in “synergies” from the deal, industry shorthand for layoffs. But the market may get there first. Paramount shares have lost 30% of their value since the deal was announced a month ago. “Paramount is massively overpaying,” former hedge fund manager and New York City mayoral candidate Whitney Tilson wrote in a note this week, noting that Paramount (market cap $10.28 billion) will take on at least $79 billion in debt to buy WBD (Market cap $68 billion). Neither company has the cash flow to service that debt and invest in new programming, said Tilson. “There’s no way the company can support such a high debt load,” he added. “I expect it to be financially crippled the day the deal closes and eventually file for bankruptcy, wiping out shareholders.”

Unilever gets spicy with McCormick deal: London-based consumer products giant Unilever $UL ( ▼ 1.38% ) says it will combine its food business with U.S. spicemaker McCormick $MKC ( ▼ 0.06% ) in a deal that would create a $65 billion food behemoth, with about $20 billion a year in revenue. Unilever and its shareholders would own about 65% of the combined company, and McCormick will pay Unilever $17.5 billion in cash. The companies say they’re creating a “global flavor powerhouse” bringing Hellman’s mayo under the same roof as French’s yellow mustard, but it sounds like a bad menu choice. Unilever wants to shed its food businesses to focus on the more profitable beauty, personal care and home products lines. The deal would give the combined group more weight with retailers and distributors. It’s not clear, though, where McCormick will get the cash. Its share price is down 12% since the deal was announced, and it’s now got a market cap of just under $13 billion. Its shares have lost nearly half their value in the past five years. Unilever is down about 7% since the announcement leaving it with a market cap of nearly $120 billion. Its shares have fallen 11% in five years, including a precipitous 25% drop since mid-February. Last year, Unilever spun off its Magnum ice cream brand $MICC ( ▲ 0.07% ) into its own company. Its shares are down nearly 10% since the split. The big reason for the declines: Consumers are spending less on food overall, and even less on premium brands. “What we really can’t get our heads round is why Unilever is disposing of a business dominated by two brands, of which it owned 100%, for a minimal control premium and leaving its shareholders with a 55% shareholding in a sprawling food business,” wrote analysts at RBC.
That private credit crisis? It ain’t getting any better. Blue Owl Capital $OWL ( ▲ 0.65% ) (not the Hogwarts exam), said Thursday it’s had to limit withdrawals from two key private credit funds as nervous investors seek to cash out amid fears that Blue Owl’s borrowers won’t be able to pay back their high-risk, high-interest loans. Investors in its tech-lending fund were asking for 40% of the $3 billion fund’s value, and its $20-billion direct lending fund had investors asking to redeem almost 22% of its value. Blue Owl manages $300 billion in private credit, but its share price has fallen by half this year. Private credit, which often leaves lenders with no recourse if loan goes sour, has attracted a host of wealthy individual investors, who have less ability to ride out market swings than banks and investment funds. Cracks int he private credit market have raised fears of a syetmic shock but for now, private credit fund operators, including Blackstone $BX ( ▲ 2.98% ) , Apollo Global Management $APO ( ▲ 1.44% ) , Ares Management $ARES ( ▲ 3.1% ) , and BlackRock $BLK ( ▲ 2.96% ) , have all limited redemptions from their private credit funds amid growing nervousness.
Merge, demerge, remerge. Hard to keep track of media these days, but when they work, those big media companies spin off reams of cash. And when they don’t, they often use those reams of cash (or what’s left in the bag) to buy something else and see if that sticks. Back in 2015, NBCUniversal paid $200 million for a piece of hip new-media empire Vox, hoping to build bridges to younger viewers. Now that NBCU’s parent, Comcast $CMCSA ( ▲ 0.67% ) has spun off CNBC and MSNBC (now called MS Now) into a new firm, named for no apparent reason after the little-known French perfume, Versant $VSNT ( ▼ 0.53% ) . The new company is looking at buying Vox’s podcast unit. This time round the game is to grab the growth of Vox’s successful podcasts including Pivot with Kara Swisher, and Dare to Lead with Brene Brown, the work coach guru. Versant has lost about 20% of its value since its spinoff late last year.
Netflix wants another touchdown (and so do its investors): After news that it was raising prices actually boosted its stock price late last week, Netflix $NFLX ( ▼ 0.16% ) is now reportedly bidding to add more NFL game exclusives to its lineup. Right now, the streamer pays $75 million a game for Christmas-only games, but it wants the rights to one NFL international game and the league’s new Thanksgiving eve game. It’s all part of a realignment that has seen traditional networks, including latecomer Fox, lose their big exclusives on sports programming, as cable channels and more recently, streaming services, bid for attention-getting (and audience building) NFL games. Google-owned $GOOG ( ▼ 0.69% ) YouTube carried an international game last season,and Amazon $AMZN ( ▲ 1.4% ) carries Thursday Night Football on Prime.
Hershey’s Chef’s Kiss: Chocolate original Hershey’s $HSY ( ▼ 1.58% ) says it’s working to make up for its customers’ better eating habits with what the industry calls “better-for-you” snacks, and will combine its sweet, salty and protein brands into a single unit. With cocoa prices rising, and fewer dollars in consumers’ pockets, Hershey is looking to new markets. In recent years it has acquired a raft of salty snack products, including SkinnyPop popcorn, Pirate’s Booty cheese puffs, Dot’s Homestyle Pretzels and organic snacks brand LesserEvil. The firm also announced on Wednesday it would revert to its original recipe for Reese’s after trying out cheaper alternatives, which caused a backlash including from the original Mr. Reese’s grandson, who wrote a public letter to the CEO on Valentine’s Day.
Food stuffed: My pizza guy is angry. This week he learned that Sysco $SYY ( ▼ 1.37% ) , the $81 billion a year food distribution giant is buying Restaurant Depot, the $21 billion a year family-owned cash-and-carry supplier for smaller food businesses across the U.S. The deal, said Eddie Vokshi, who owns the Antica Pizzeria in Manhattan’s Washington Heights, will just stifle competition and raise prices for small mom-and-pop eateries like Eddies. “Sysco is just gonna kill us,” Vokshi said. Sysco is paying $29.1 million for family-owned Restaurant Depot, and will continue to operate its 166 warehouse stores in 35 states under the Restaurant Depot brand. Less money in consumers’ pockets means demand for cheap eats like pizza is growing, but rising rents, growing food costs and galloping energy prices are cutting into Vokshi’s margins. Shares in Sysco are down 20% since the beginning of March.
(Getty Images)
I’ll drink to that: Jack Daniels parent Brown-Forman $BF.B ( ▼ 2.17% ) is considering a merger with French liquor giant Pernod-Ricard as the two firms battle a difficult market for premium liquor brands. For family-controlled Brown Forman, these are particularly bad times to be in the bourbon business: Americans are drinking less hard liquor and the tariffs have incited hefty counter taxes on exports to key markets including Canada and Europe. Then there’s the hangover from bourbon’s pandemic-era popularity, which led to a spurt of new boutique bourbon brands whose years of aging mean liquor produced at the beginning of the decade is just getting bottled and sold now. Brown-Forman has a market cap of about $12 billion, while family-controlled Pernod’s is closer to $18 billion. Both firms need to shake things up. Pernod’s share price is down 68% in the past five years, and Brown-Forman is down 62%. But Brown-Forman’s shares are up 13.6% in five days on news of a potential merger, while Pernod is up about 0.25%. Jeffries analyst Edward Mundy wrote in a note to clients that he sees “significant merit” in a merger of the two firms.
Allbirds, all gone: High-flying sneaker brand Allbirds $BIRD ( ▼ 0.29% ) , famed for its Merino wool uppers and a fave with Silicon Valley types, has crashed back to earth with less grace than Icarus in a heatwave. After hitting a $4 billion valuation in 2021, it’s selling its assets for $39 million to brand management firm American Exchange Group. “Allbirds has gone from being a highflier to a dead parrot,” GlobalData consultant Neil Saunders told the New York Times, with a touching nod to the Monty Python sketch about “ex-parrots.” Despite 60 retail locations at the end of 2023, the shoes failed to catch on outside the tech world. And now, the tech uniform is sneakers from Hoka and On.

(Google Nano Banana Pro)

How Jennifer Aniston’s LolaVie brand grew sales 40% with CTV ads

The DTC beauty category is crowded. To break through, Jennifer Aniston’s brand LolaVie, worked with Roku Ads Manager to easily set up, test, and optimize CTV ad creatives. The campaign helped drive a big lift in sales and customer growth, helping LolaVie break through in the crowded beauty category.

Learn more

END OF ADVERTISEMENT

The tech stack

The Kremlin’s privacy hack: Russia’s got a new all-in-one platform that’s like facebook on steroids: Social media, e-commerce, dating, ride hailing: It’s all in single app called Ma, and it’s being touted locally as safer than the country’s favorite encrypted apps, Telegram and WhatsApp. The problem: Max is being pushed by the Russian state, and one potential effect of using the new app: They’re not encoded, and the Kremlin will know what you’re doing. The app itself, say tech observers, is one in a series of Russian knock-offs of Western apps including YouTube and WhatsApp, which Russian apparatchiks fear open their countrymen to Western influences.

(Getty Images)

The 404: Oracle’s $ORCL ( ▲ 2.66% ) bid to become a big player in the AI datacenter business is putting renewed pressure on its profits, and this week, the company laid off thousands of people. While there’s no official word yet, the Wall Street Journal reports former Oracle employees posting about layoffs on their social media and LinkedIn accounts. Industry watchers had predicted up to 30,000 layoffs as Oracle pumped resources into AI data centers. The layoffs boosted the share price by 6% on Tuesday, but shares are down more than 50% since a mid-October peak that briefly made Oracle founder and CEO Larry Ellison (picturedf) the world’s wealthiest person.
No laughing matter: The Iran war has crimped global supplies of helium, a byproduct of natural gas processing. But it's not party balloons that will suffer most, it’s microchip production (helium cools chipmaking machines and cleans away toxic residues) and MRI machines (where it’s used to cool superconducting magnets). Given that microchips are commonly used in almost everything, these days, it’s an awkward situation for everyone.

Want more Cheddar?

Insider trading: "What’s needed is enforcement — not new excuses.”

Cheddar's Big Business This Week — Thu, 26 Mar 2026 20:30:00 +0000

TODAY’S NEWSLETTER IS BROUGHT TO YOU BY:

Somebody got rich quick on Monday morning. Just 16 minutes before President Donald Trump’s surprise decision to pause the bombing campaign against Iran, market records show traders bought about $1.5 billion in S&P 500 $SPX ( ▲ 0.81% ) futures and sold about $500 million in crude oil $CRUDE ( ▲ 0.31% ) futures.

After President Trump’s 7:06 a.m. social media post, the S&P futures rose between 0.9% and 1.3%, while oil futures fell about 15% even before the markets opened. That’s a potential profit of $40 to $50 million on the oil, and $18 million or so on the S&P futures. Did someone have advance knowledge of the market-moving announcement? To understand what happened and whether this was insider trading, BBTW Editor Peter Green spoke with Ben Schiffrin, a former SEC enforcement attorney who now runs securities policy for good-government group Better Markets.

There’s been a lot of chatter about those massive oil and S&P futures trades that hit just before President Trump announced he was pausing the bombing campaign in Iran. Was this insider trading?

“Certainly, the timing of the trade is highly suspicious. The age-old question on insider trading is, what are the chances that someone just happened to make the right trades at exactly the right time? It’s possible, but lots of times it’s unlikely. Normally, agencies like the Commodity Futures Trading Commission would go in and investigate to find out whether it was just coincidence or whether somebody actually had inside information and traded on it illegally.”

“Unfortunately, these days, the CFTC seems more interested in supporting prediction markets than in regulating the market. There’s really nothing preventing it from trying to figure out what happened here—the CFTC has long gone after insider trading. The problem is enforcement capacity. They’ve lost a lot of personnel and focus.”

How would regulators actually track down who made these trades?

“The CFTC can investigate, look at trading records, and then build up through the intermediaries that help facilitate the trade. There’s definitely a way they can trace it back… This is what makes it a little different from the potential insider betting sites like Polymarket where everything’s in crypto and anonymous. It would be very hard to figure out the identity of an insider bettor on those sites. But with these traditional commodities trades, the CFTC has experience unraveling that. They can subpoena records. Even in a digital age, there’s always a paper trail.”

“In garden‑variety insider trading cases, you often find a message or a text — some ‘Hey, you should be aware of this’ type note. That’s what investigations look for. As for whether it was a single trader or multiple entities? I don’t think anybody knows at this point. It’s just too early.”

You mentioned prediction markets like Kalshi and Polymarket — where users bet on political or military events — and how some have profited ahead of major actions.

“I think you have to separate what’s going on in prediction markets versus traditional commodities markets. On prediction markets, people don’t necessarily think there’s anything preventing them from using confidential information to bet. Up until recently, even Kalshi hadn’t said it would police for insider betting… You could easily see a trader saying, ‘I’ve got this intelligence, and there’s nothing stopping me from profiting off it.’”

“You need rules that prevent people from doing that — and then, of course, enforcement of those rules. With traditional markets like oil futures, the rules already exist; the problem is they’re not being enforced. The CFTC and the SEC have both been much less active in the last year. The CFTC, in particular, lost a lot of enforcement personnel and morale. So, I think it’s not that there aren’t rules to prevent insider trading — it’s that nobody seems to be focused on enforcing them. The leadership at the CFTC needs to get back to its core mission rather than being preoccupied with crypto and prediction markets. There’s no question the appearance of insider trading has become more frequent… from bets on strikes in Iran to wagers on Venezuela’s leadership changes. It’s all part of a pattern. “

—Peter S. Green

Big Businesses mentioned this week:

$META ( ▲ 4.7% ) $GOOG ( ▼ 0.69% ) $EL ( ▲ 0.23% ) $RGR ( ▲ 0.29% ) $TSLA ( ▲ 3.17% ) $UBER ( ▲ 1.02% ) $RIVN ( ▲ 8.76% ) $LCID ( ▲ 0.17% ) $AMZN ( ▲ 1.4% ) $HMC ( ▼ 0.51% ) $SONY ( ▼ 1.04% ) $DIS ( ▼ 0.55% ) $WBD ( ▲ 1.84% ) $NXST ( ▲ 0.25% ) $YOU ( ▲ 1.15% ) $DAL ( ▲ 2.21% ) $UAL ( ▲ 2.24% ) $BA ( ▼ 0.82% )

This week, big business!

Why the “Tehran TACO” trade is so much spicier tha …
Is this tech’s ‘Big Tobacco’ moment?
The short stack
Car talk
Media mirror
Want more Cheddar?

Why the “Tehran TACO” trade is so much spicier than previous TACOs

TACO—also stands for “Trump Always Chickens Out.” Image Credit: Getty

Eat too many tacos and you need relief. But when you’re an investor, and the TACO is another move by U.S. President Donald Trump in his month-long bombing campaign against Iran, that relief is hard to find.

“Things are crazy right now,” said Chris Hodge, chief U.S. economist at Natixis. “I don't know how you deploy capital with this amount of uncertainty. Nobody wants to get caught on the wrong side being too bearish when the president tweets out, ‘everything's okay, we're going to open up the Strait of Hormuz, the enemy is going to surrender.’”

Some of that rollercoaster ride is down to Presdient Trump’s mastery of the media, and the swift, if haphazard way his administration implements policy changes, like the day last April when Trump implemented his tariff regime. Markets react quickly to these moves, said Wendy Li, CIO at the alternative asset investment platform Ivy Invest.

“Where this term TACO has come about, is that Trump will make some dramatic statements or changes and policy shifts, and then pull back and recalibrate as necessary based on market reactions, and there's this perception that has been generally validated by the ability to recalibrate when things have created excess volatility,” Li said in an interview. But she added, “With the war in Iran, I think we may see a different outcome.”

Right now, she said, as the president trumpets negotiations, oil prices quickly drop and stock prices rise as investors think a return to normal is in the cards. And then Iran comes back and says there are no negotiations, just an exchange of incompatible proposals. “There's such a lack of clarity that markets are just responding very quickly to every piece of information that comes out.”

The problem, Li added, is that a war is qualitatively different from Trump’s peacetime policy switched, making this TACO trade a lot spicier.

“The expectation that things will resolve nicely and neatly, the buy-the-dip TACO mentality, is not necessarily the experience we're going to have here, in large part because wars are unpredictable,” she said. “Someone can't unilaterally decide to call an end to this. They can spiral out of control and last for far longer than it appears at the outset. Every week that goes by, there is an almost exponentially increased risk that we're going to have the supply-side shock for longer, because it's not like a flip of a switch and all this oil production comes back on.”

But the more the Administration threatens major changes, the less confidence investors and traders have that there will be a profitable bounce back from policies that are suddenly abandoned. In large part, that’s because Trump may have lost the upper hand in this conflict. As Hodge noted, it comes down to who’s really in charge: “Whatever the president says, it takes one party to start a war, it takes everybody to end it, right? So the enemy gets a vote here too.”

END OF ADVERTISEMENT

Is this tech’s ‘Big Tobacco’ moment?

Parents and family members of victims embrace after the jury found Meta and YouTube liable in the social media addiction trial, outside the Los Angeles Superior Court , in Los Angeles, on March 25, 2026. Image credit: (Photo by Frederic J. Brown / AFP via Getty Images)

Two juries ruled that Meta $META ( ▲ 4.7% ) and Youtube $GOOG ( ▼ 0.69% ) are bad for kids this week, in California and New Mexico, when they said the social media platforms’ parent company, Meta, got young users addicted and failed to protect them from sexually explicit content, solicitation, and human trafficking. In New Mexico, the jury stuck Meta with the max fine possible, $375 million. In Los Angeles, an unidentified woman was awarded $6 million after the jury found Meta and Alphabet-owned YouTube chose to make their apps addictive, leading her and others to have significant mental health issues. The New Mexico fine is only about 1/60th of Meta’s most recent quarterly profits, but it’s the verdicts that matter. They mark the first time a social media platform has been held responsible for the content it disseminates. Dozens of similar lawsuits are proceeding in state courts, after Congress declined to regulate social media companies. Meta faces some 2,000 similar suits in Federal courts, provoking a possible avalanche of industry-changing settlements like Big Tobacco had to make in 1998.

All bets, er, predictions, are off in Nevada

State and federal officials are cracking down on Kalshi and Polymarket, the leading “prediction platforms” that dress up sports gambling and other forms of betting as federally (and loosely) regulated futures contracts. Nevada just got a court to order Kalshi that it needs a state gambling license to keep operating there, and it’s banned (for now) from offering so-called event-based contracts linked to sports, elections or entertainment. In Washington, Republican Sen. John Curtis of Utah and Dem senator Adam Schiff of California introduced a subtly-named bill called the “Prediction Markets Are Gambling Act.”

The short stack

Beautiful deals: Estee Lauder $EL ( ▲ 0.23% ) , the beauty firm controlled by Trump-whisperer Ronald Lauder (he reportedly convinced Trump to try to annex Greenland) is in talks to buy high-end European beauty products company Puig for $10 billion. Estee Lauder’s brands include Clinique, M.A.C, Bobbi Brown Cosmetics and Le Labo. Family-run Puig owns Carolina Herrera, Charlotte Tilbury, Byredo and Dr. Barbara Sturm. Che bellezza!
Pistols at Dawn: It looks like a stand-off, but family-owned Italian arms maker Beretta may have more financial firepower than its target, U.S.-based Sturm, Ruger & Co. $RGR ( ▲ 0.29% ) , the largest U.S. firearms maker. Beretta owns almost 10% of Ruger, and wants to take a 20% stake in the company, get more board seats and, Ruger says, combine the two firms in the near future. Beretta denies it wants to take over its more-lightly armed opponent, but Ruger says it’s sticking to its guns and won’t sell. Ruger’s stock is down 35% in the past five years.

Car talk

Tesla’s Eurobounce: After a year of falling sales, Tesla’s $TSLA ( ▲ 3.17% ) European sales may be doing a 180. Tesla new-car registrations rose nearly 12% in February from 2024 to 17,664 units across Europe, despite political backlash against Musk’s support of the President Donald Trump, and rising pressure from Chinese EV-maker BYD $BYDDF ( ▼ 2.25% ) . The shift to electric could speed up if the war on Iran continues and gas prices keep jumping. And in more good news for Tesla, the electric truck it calls, imaginatively, “the Semi,” seems to be a hit with truckers, the Wall Street Journal reports. Selling for about $300,000, double the cost of a diesel truck, the new rigs can go 500 miles on a charge — if you can find the high-powered charger they need. But truckers say they’re a dream to drive - no 13-gear shifting or noxious diesel fumes. Tesla plans to make 50,000 Semis a year at its Nevada plant. Tesla shares are down about 12% this year.
Uber picks Rivian: Uber $UBER ( ▲ 1.02% ) picked California-based Rivian $RIVN ( ▲ 8.76% ) to supply electric taxis for its debut next year in Miami and San Francisco. Uber will buy 10,000 Rivian R2 SUVs, and invest $300 million in Rivian. Uber announced a similar deal last year with Lucid $LCID ( ▲ 0.17% ) for 20,000 electric robotaxis over the next six years. And Amazon’s $AMZN ( ▲ 1.4% ) oddly-named Zoox electric ride-share company said it will be expanding its robotaxi service in San Francisco and Las Vegas, and start testing its custom-built driverless cars in Austin and Miami later this year. But there’s always someone who’s gonna throw shade: Honda $HMC ( ▼ 0.51% ) is calling off its joint venture with Sony $SONY ( ▼ 1.04% ) to make Playstation-styled self-driving EVs. The $102,900 Afeela-1 would have let users stream movies or play on their playstations while they ride, but Honda said the end of U.S. EV subsidies and a dearth of charging stations mean there’s not a big enough market for EVs in the U.S. Honda plans to take a $15.7 billion charge, for its first annual loss in decades, after ending plans for three other U.S. EVs.
Slop stop: OpenAI has killed its video content maker known as Sora, a deal with Disney $DIS ( ▼ 0.55% ) that was supposed to let users make their own Disney-themed content. But just days after launching a new instruction manual on how to use Sora, the two pulled the plug. Disney’s promised $1 billion investment into OpenAI went with it. OpenAI is shifting to focus on business customers, but there’s speculation that the real trigger for the deal being called off is its Disney characters were being used in what might best be politely described as “non-family fare.”

Media mirror

This ain’t no gentle mouse: Disney $DIS ( ▼ 0.55% ) thought it could relaunch its sagging “Bachelorette” franchise with a new season featuring “Secret Lives of Mormon Wives” star Taylor Frankie Paul, a divorced single mom. But then gossip site TMZ ran a video of Paul beating up on her ex, Dakota Mortensen, and now Disney’s pulled the show. It’s not clear why Disney thought a Tinder-meets-MMA show wouldn’t garner eyeballs, but Disney stands to lose about $50 million (including $35 million in ads) as it cancels the season. Utah police have been investigating Mortensen’s allegations of domestic abuse by Paul.
Good night and good luck: So how's it going over at Paramount Skydance-owned CBS? Not so great. Chief news poobah Bari Weiss announced she’s shuttering 99-year-old CBS Radio News, claiming it just can’t make money. That’s where everyone from Edward R. Murrow to Walter Cronkite and Marvin Kalb got their starts. “It’s no secret that the news business is changing radically, and that we need to change along with it,” Weiss wrote in a note to staff, announcing the closure and layoffs of 6% of CBS News staff. The news network was carried on about 700 affiliated radio stations. Meanwhile, media newsletter Status got its hands on some viewership data for CBS, learning that under Weiss, CBS’ flagship Evening News show is headed to its lowest-rated first quarter of the century in both total viewers and the coveted 25-54 demographic. The Larry and David Ellison-controlled Paramount $PSKY ( ▼ 4.31% ) , which has lost half its value in the last six months, is poised to buy Warner Bros. Discovery $WBD ( ▲ 1.84% ) , and with it control of CNN.
Monopoly, shmonopoly: Nexstar Media Group $NXST ( ▲ 0.25% ) got both the Dept of Justice and the FCC to approve its $6.2 billion takeover of Tegna, the TV station group of the former Gannett newspaper chain. State attorneys general and satellite broadcaster DIRECTV are still suing to block the consolidation, which they argue reduces viewer choice and violates decades old media ownership rules meant to protect a diversity of opinions. The new group will have 260 local broadcast stations. Local stations are facing economic pressure from cable, streaming and smart phones, and say the need to merge to survive. Opponents of the deal say local affiliate stations are still massive profit-makers. Nexstar CEO Perry Sook expressed his gratitude in a statement: “We are grateful to President Trump, [FCC] Chairman Carr, and the DOJ for recognizing the dynamic forces shaping the media landscape,” Sook said.
High Flyers: Check-in chaos may be making air travel a nightmare for many Americans as the fight over funding ICE drags in sister Homeland Security agency TSA, the friendly folks who make you take your shoes off before you can buy that $8 Starbucks drip at the gate. But one company is thriving: Clear Secure $YOU ( ▲ 1.15% ) , whose Clear app pre-screens premium paying customers helping them avoid long security lines at the airport. Its shares are up 15% in the past month, and have doubled in the past year. Members of Congress might want to sign up for it: Delta $DAL ( ▲ 2.21% ) has just announced no more white-glove treatment for senators and congressmembers at U.S. airports, at least until TSA gets its funding back. Once they get to the gate, lawmakers (and ordinary passengers) may find fewer reasonably priced coach-class seats, as airlines add premium capacity, because, well, that’s where the profits are. United $UAL ( ▲ 2.24% ) says it will add 44 Boeing $BA ( ▼ 0.82% ) 787-9s over the next two years, most of them with additional premium seats, along with 68 Airbus 321s that have lay-flat seats in business class. Since 2020, the number of business and first-class seats on domestic flights has risen 27%, while the number of economy seats is up just 10%.

Elon’s World

Fraud case: Remember when Elon Musk tried to wriggle out of buying Twitter back 2022? He suddenly started talking down the company, saying the feeds were riddled with bots, and it wasn't worth the money he was offering? Well, a federal jury in California ruled that he owes $2.5 billion to former Twitter shareholders who sold on the dip Musk’s tweets caused, and lost out when he finally yielded to pressure from courts and shareholders, and agreed to buy Twitter after all. The former shareholders said Musk’s goal was to “trash Twitter with his personal megaphone — his Twitter account — punish the stock, and try to renegotiate.” In the end he paid $44 billion for Twitter. But the jury didn’t hold Musk liable for deliberately trying to drive down the share price. The trial produced some gems: “If this was a trial about whether I made stupid tweets, I would say I’m guilty,” Musk testified. Musk won a similar suit in 2023 over investor losses when he tweeted that he had “funding secured” to take Tesla $TSLA ( ▲ 3.17% ) private. He didn’t.

Want more Cheddar?

Does the private credit crisis have echoes Of 2008?

Peter S. Green — Thu, 19 Mar 2026 20:30:00 +0000

If you asked anyone in 2007 what a “subprime mortgage” was, they wouldn’t have any idea. So here’s a question for you: Do you know what the private credit market is?

Here’s why your answer matters: When prominent U.S. financiers start drawing parallels to the Great Recession of 2008, it might be time to worry. And yes, this time around, yet another little-known investment vehicle has people increasingly concerned.

At its simplest, private credit is a loan made to a company by a non-bank lender. In the traditional world, if a business needed money to grow, it went to a big bank (like Chase $JPM ( ▲ 1.47% ) or Wells Fargo $WFC ( ▲ 1.58% ) or issued bonds on the public stock market. In private credit, that middleman bank is removed. Instead, the business borrows money directly from a private investment firm.

The advantage for borrowers is that they can get cash quickly in a squeeze, and they don't need to show the same financial solidity as they’d need for a loan from a bank. When times are good, investors like the higher interest rate and the supposedly guaranteed return that private credit loans offer. But now a confluence of forces is raising questions about how strong the private credit market really is. The scale of a possible looming crisis could bring down confidence in the broader stock market.

Doubts about private credit have already spread so far that some of the major publicly traded firms making a lot of private credit loans have seen a sudden and significant drop in their share prices this year, including giants like Apollo Capital Management $APO ( ▲ 1.44% ) (down 25% this year), Ares $ARES ( ▲ 3.1% ) (down 36% this year), Blackstone $BX ( ▲ 2.98% ) (down 30% this year) and Blue Owl Capital $OWL ( ▲ 0.65% ) (down 41.5% this year).

What’s the problem? In a word, the private credit giants got overextended. They began offering private credit exposure to retail investors through the big brokerages (known in the investing world as “wire houses”), just as interest rates are failing to come down, and the war in Iran is making small investors nervous. Now, too many investors want to cash out, or redeem their investments. The tide is going out, and the question is: Which borrowers were swimming naked?

Speaking of the borrowers: A large amount of private credit has been extended to tech companies, many of which have suddenly seen their business models turned upside down by AI, especially those Software-as-a-Service companies whose proprietary cloud software is easily cloned or replicated by Claude and his posse of profit-killers.

The biggest difference between private credit and traditional means of business financing, like bank loans, stock offerings, or bond issuing, is the absence of organized exchanges to trade and price the loans, and a lack of information about the vast bulk of private credit loans.

That murkiness increases not just the perception of risk, but real risk, and it means that when investors get spooked, it doesn’t take much to start a run. That’s what happened last month, when Blue Owl Capital saw its investors trying to cash out. They were asking for more cash than the borrowers were paying on their loans each month. So Blue Owl capped so-called redemptions, but that just sent its share price tanking. That’s when former Pimco CIO Mohamed El-Arian,a well-regarded financial prophet, asked if private credit marks are seeing their “canary-in-the-coalmine moment,” much like the 2007 beginnings of the mortgage crisis that provoked the Great Recession. Here’s his Tweet:

There are indeed some strong parallels between 2008 and 2026: For one, no one is quite sure how large the private credit market is. Estimates range from about $1.7 to $2 trillion, a relatively small chunk of the $40 trillion U.S. commercial debt and credit market. But many investors don't know just how much risk they are actually carrying. Borrowers don’t have to provide the same level of financial information they do to the stock market, and that private credit debt can get sliced and diced into tranches of varying creditworthiness, the same way mortgage-backed securities were, back in the aughts.

Then there’s the contagion factor, which works two ways. The first is contagious fear: As more investors try to redeem, the headlines get worse and still more investors want to find a safer haven. The other contagion factor: When private credit borrowers default, they’re taken over by the private credit lenders. That means no cash flow from interest payments for the syndicates, but it also means equity investors — and these firms tend to have large private equity investors waiting for an IPO payday — are hit with a huge loss. That contagion can reverberate around the financial system, much as the commercial and subprime mortgage defaults hit an over-leveraged financial system in 2008.

So how bad is it? For now, cool heads seem to be prevailing. Kaush Amin, head of private market investment at U.S. Bank, says the fears are overblown. “The numbers are still not showing broad-based stress,” Amin said in an interview. And while some private credit borrowers, especially those whose business has been upset by AI, tariffs or interest rates (think commercial real estate) may end up forcing lenders to write down their loans, there’s less sense of a systemic threat, for now, to the financial system, the way there was in 2007 and 2008. “A lot of these are cash-flowing companies, so I don't think they'll have an issue servicing the loan. The biggest issue right now that we see is that sentiment is driving redemption requests,” said Amin.

It’s also worth remembering that for retail investors who kept their money in the market during 2008, the subsequent rewards have been substantial:

Stock market performance from 2006 to 2026. That tiny blip in the bottom left-hand corner is the 2008 financial crisis. Image credit: Google’s Nano Banana Pro, based on $SPX ( ▲ 0.81% ) S&P500 data.

Still, at least you know what the private credit market is, now. Let’s hope you won’t be hearing much more about it over the coming months.

Big Businesses mentioned this week:

$APO ( ▲ 1.44% ) $ARES ( ▲ 3.1% ) $BX ( ▲ 2.98% ) $OWL ( ▲ 0.65% ) $WBD ( ▲ 1.84% ) $PSKY ( ▼ 4.31% ) $NFLX ( ▼ 0.16% ) $AAL ( ▲ 3.27% ) $UAL ( ▲ 2.24% ) $DAL ( ▲ 2.21% ) $LUV ( ▲ 1.15% ) $IAG ( ▲ 2.93% ) $LHAI ( ▼ 9.59% ) $QAN ( 0.0% ) $MSFT ( ▲ 0.27% ) $GOOG ( ▼ 0.69% ) $CME ( ▼ 1.38% ) $NYT ( ▲ 1.56% ) $TSLA ( ▲ 3.17% )

This week, big business!

The war story
The usual suspects
Trumplandia
Want more Cheddar?

The war story

Flash, bang, boom! Oil and gas prices are shooting up, as the War on Iran rolls on without a clear end plan. A direct Iranian strike overnight Wednesday on the world’s largest liquified natural gas facility at Ras Laffan sent oil prices up to $119 a barrel for Brent crude May delivery, before dropping to $114, a 7% overnight climb, and up nearly 80% this year. The front-month gas price in the Netherlands, a European benchmark, jumped 16% to 63.42 euros a megawatt-hour. U.S. natural gas prices jumped 2.8%, and U.S. gasoline futures hit $3.18 a gallon for April delivery, up 2.6% overnight to a high last seen at the end of the pandemic. None of this is good news for the world economy. Oil prices are likely to keep rising into the high-$100+ a barrel range, says Rapidan Group’s Bob McNally, a leading energy strategist, before plummeting as the world enters a recession. "They grind higher until they cause pain, enough pain to slow the economy and demand dissipates, and we get a free fall," McNally told Business Insider. The problem is that oil won’t peak until either Iran’s ability to block the Strait of Hormuz is wiped out, or Israel and the U.S. negotiate an end to the fighting. But analysts say the killing of top Iranian leaders may have left the country without a central command and control structure, leaving no one to negotiate with and leaving individual military units to choose their own targets. Bettors on Polymarket give a 69% chance of the War ending by June 30:

Image source: Polymarket odds on the end date of the Iran conflict.

Jonesing for a ship: In a desperate effort to help keep the price of oil and food from climbing even further, President Trump has waived the Jones Act, a 1920 federal law that says only U.S.-made and crewed ships can carry cargo between U.S. ports. The waiver is unlikely to do much to bring down consumer costs. While gasoline is up about 30% per gallon(about 85 cents) since the war started, an MIT study found that the Jones Act added only about 1.5 cents a gallon to the price of gasoline. The U.S. shipping lobby is incensed: “We will be watching closely,” warned the American Maritime Partnership. The group says the bill protects American jobs.
Friendly Ghost Fleet? The Trump Administration has lifted restrictions on Iranian-owned tankers that are part of the sanctions-busting ghost fleet that’s been bringing Iranian oil to China and other countries. Trump also lifted sanctions on Russia’s ghost fleet, letting the Putin regime sell as much as $1.2 billion a day in more oil to support its war in Ukraine. Just last month, the U.S. slapped new sanctions on 14 Iranian tankers that the State Dept. said were funneling money to Tehran used to “support terrorism abroad and repress its citizens.” Oil prices spiked after Iran said it laid mines across the 21-mile-wide Strait of Hormuz, through which nearly all Arab and Iranian oil, about 20% of the world’s supply, has to pass. But according to Lloyd’s List Intelligence, some 90 ships have passed through the strait since the U.S. attacked Iran on Feb. 28. Trump is betting that keeping the oil flowing could help bring down prices, which have shot up more than 40% since the war started.
Meanwhile, holding on to tankers seized from Venezuela is getting expensive for the Trump Administration. One seized tanker, Skipper No. 9304667, has cost the U.S. $47 million over the past three months in maintenance, repairs, insurance, crew wages, and storage fees for the ship’s oil. The ship is only said to be worth about $10 million, and its oil cargo worth about $120 to $135 million at current prices.

Attio is the AI CRM for modern teams.

Connect your email and calendar and Attio instantly builds your CRM. Every contact, every company, every conversation — organized in one place. Then ask it anything. No more digging, no more data entry. Just answers.

Start your free trial →

END OF ADVERTISEMENT

The usual suspects

Cashing out: Departing Warner Bros. Discovery $WBD ( ▲ 1.84% ) CEO David Zaslav may have killed off one of Hollywood’s most storied studios, but he’s laughing all the way to the bank. Zaslav is set to exit with more than $800 million in severance and other payments, according to an SEC filing, including a tax payment worth about $130 million, if the planned sale to Larry and David Ellison’s Paramount Skydance $PSKY ( ▼ 4.31% ) goes through. Had Netflix $NFLX ( ▼ 0.16% ) won the bidding for WBD, the tax payment wouldn’t have been needed. WBD’s share price is down about 25% since it was first announced that Zaslav would be leading a merger of Warner Brothers with Discovery, back in 2021.

Fly-By: Iranian rockets and sky-high fuel prices aren’t keeping Americans from taking to the air, even as ticket prices rise an average of 10% to cover the higher costs, airline execs said at an industry conference this week. American $AAL ( ▲ 3.27% ) , United $UAL ( ▲ 2.24% ) , and Delta $DAL ( ▲ 2.21% ) each said they expect to pay an extra $400 million for fuel this year, but were leaving their profit forecasts unchanged. The U.S. Global JETS ETF, a good proxy for airline stocks, is down more than 18% in the past month. You know what else is down? Southwest’s $LUV ( ▲ 1.15% ) tolerance for hefty passengers. Once known for accommodating large travelers, Southwest is now getting flak from fat flyers for forbidding them from flying unless they purchase an extra seat. The National Association to Advance Fat Acceptance says Southwest has become “much more aggressive” at identifying tubby travelers. Southwest has been struggling over the past year or so. The war has been a disaster for the three giant Gulf-based airlines, Emirates, Qatar Airways and Etihad Airways. They’ve turned the Gulf into a hub that handled 227 million passengers last year, and with more than 50,000 flights cancelled since Feb. 28, the total cost to the airlines plus tourism in the Gulf could hit $56 billion this year, according to an analysis cited by the New York Times, and it’s hurting places like India and Southeast Asia that rely on visitors who transit through the Gulf. That could be a bright spot for competitors based elsewhere. British Airways and Germany’s Lufthansa $LHA.DE are adding seats to long-haul flights that bypass the Gulf, as is Australia’s Qantas $QAN.AX.
The Pentagon is doubling down on its “anti-Woke” attack on Anthropic, which is so far the only AI to pass the Defense Department’s security screenings. In federal court filings, the Pentagon said itquestioned whether Antropic was a “trusted partner” and would introduce “unacceptable risk” into military supply chains. That followed a threat last month by Defense Secretary Pete Hegseth, to declare Anthropic a “supply chain risk,” after the firm said it didn’t want Anthroppic’s AI used for mass domestic surveillance or to develop and run autonomous killingmachines. Microsoft $MSFT ( ▲ 0.27% ) filed a brief supporting Anthropic, as did a group of 37 OpenAI and Google $GOOG ( ▼ 0.69% ) engineers.
Taking Banksy to the Bank: The elusive British graffiti artist has finally been tagged: He’s a 50-ish man named Robin Ginnigham, from Bristol on the west coast of England. What’s in a name, you ask? Money, it turns out. Collectors, who have paid as much as $24 million for Banksy’s work say knowing the artist’s identity ultimately means it’s easier to be certain a work is genuine, keeping prices high.

Image credit: Banksy Google’s Nano Banana Pro

Trumplandia

It ain’t happening: That’s a rate cut for 2026. Rising inflation from the Iran War oil crisis speaks louder than anything President Trump can say: The Fed’s Open Market Committee said Wednesday it won’t be cutting rates any time soon, avoiding talk of the war, with Fed chair Jerome Powell saying the economy and labor markets are in good shape, and core inflation (not including energy) is likely to moderate in the coming months. That means no need for a rate cut. What went unsaid was the war. “Investors concluded that monetary policy may be limited in its ability to address the war’s economic consequences,” investor Fred Yardeni wrote in a note posted after the Fed meeting. Powell’s intended successor, the yet-to-be-confirmed Kevin Warsh, has been under pressure from President Trump to lower rates to help shrink the national debt and boost the economy, but that’s probably on hold for now, and futures markets now put the odds of a 0.25% cut in benchmark rate at just 17.2%.
No more quarterly earnings releases? The SEC is preparing a proposal to let publicly traded companies report their earnings only twice a year, instead of every three months, as they’ve been required to do for more than half a century. The idea is supposedly to reduce the burden on public companies, but investors fear a lack of transparency would affect the security of their stock holdings. Europe and the UK have botched relaxed quarterly reporting requirements. The proposal has yet to be made public, and it will be open to hearings, and then the SEC itself will vote on whether to enact the rule.
The family business: Even as Jared Kushner jets around the Middle East trying to broker a peace deal alongside his father-in-law’s special diplomatic envoy Steve Witkoff, Kushner is also soliciting Middle East government to invest some $5 billion in his investment firm, Affinity Partners, The New York Times reports, citing people with knowledge of the solicitations. Among Kushner’s targets: Saudi Arabia’s Public Investment Fund. Kushner said in 2024 that he wouldn’t blur public and private lines by seeking investments while Trump is in office. But new fundraising documents say that Affinity has already invested close to $4 billion of the $5 billion it’s raised, and claims a 25% annual return.
Trolling Elon? A Corsican drink wholesaler called Unibev says it owns the trademark “Cybercab,” setting up a major trademark dispute that could dog Tesla $TSLA ( ▲ 3.17% ) as it prepares to manufacture driverless taxis under that name. Tesla notes that the French company has never built a car of any kind, and its CEO, Jean-Louis Lentali, is a regular on Tesla’s quarterly earnings calls. The Musk-led car maker has filed a complaint with the U.S. Patent and Trademark Office, calling Unibev a “trademark squatter.” Lentali filed a trademark application six days after Musk first used the word Cybertaxi on a 2024 earnings call. It took Tesla six months to file its own trademark application for the name.

Image credit: Google’s Nano Banana Pro

Want more Cheddar?

War and the oil price swings rattling global markets

Peter S. Green — Thu, 12 Mar 2026 20:30:00 +0000

Crude Oil Prices over the last 15 Trading Days. Image credit: Google Nano Banana Pro.

Oil markets have been lurching up and down as the U.S. and Israeli bombing campaign against Iran shuts down shipping in the Persian Gulf. Tankers have been delayed, governments are releasing strategic reserves, and traders are reacting with jitters to every new headline from Washington. The consequences go far beyond gasoline prices. Oil is the raw material for everything from plastics to fertilizers, with shocks rippling through global supply chains and inflation. To understand what is driving the volatility — and what might happen next — we spoke with Anas Alhajji, managing partner at Energy Outlook Advisors, and a longtime analyst of global oil markets.

Oil prices have been swinging dramatically. Four out of five barrels of oil do NOT move through the Straits of Hormuz. If countries and refineries hold weeks of reserves, why are markets reacting so violently?

Too many factors affect price. People act on the news only to discover it was fake or inaccurate, or market manipulation by the Trump administration. These trades are done within seconds. So, when the President made that statement [about ending the war soon], prices went down by about $20. Then people realized that his statement was incorrect. So the price went up again. When the Secretary of Energy made that claim that tankers were being escorted by the U.S. Navy, and a few minutes later deleted the tweet, well, within those few minutes, prices plummeted $18 and then bounced back.

The U.S. has announced a 3-month series of releases from the Strategic Petroleum Reserve. And under the International Energy Agency, many other countries are doing the same. How does that affect prices?

Think about it this way. They are going to flood the market with 2 million barrels a day [that’s about 10% of daily U.S. demand] for 120 days. It will keep prices lower, and if the war ends this week, and they continue releasing oil from the SPR for the next three months, the price could drop to $50 by the fall. And because the government is selling it at $90 or $95, they’ll be able to buy it back to replenish the reserve at $50 and $60 and $70. That’s a deal! Biden was buying it at $79.

If the war ends quickly, would the oil crisis end quickly as well?

If the war ends tomorrow, the crisis will not end tomorrow. If the war ends tomorrow, we still have problems because we need to get all those ships out of the Gulf. And then we need to bring back production that's being shot at, and that takes time. So ending the war does not end the crisis. To bring back oil and LNG production to pre-crisis levels will take a few months.

What does this disruption mean for the global economy?

The insurance fiasco that closed the Strait of Hormuz is affecting the whole world, and the ripple effects will reach the US even if there are no direct effects. We will see rising inflation and interruption of supply chains.

Does this crisis accelerate the shift away from oil toward other energy sources?

No, but some energy sources will benefit here in the US and overseas, such as coal. But it’s not enough of a shock to end our oil reliance.

Who ultimately benefits from the current turmoil?

Russia was selling its oil and gas and LNG at a discount. And now, because they are not limited, because they can add production and send it anywhere in the world, and because the prices of oil and LNG went through the roof, to the extent that it was sold at a discount, now it's selling at a premium. [So,] the two main winners in this crisis are Trump and Putin. Putin benefits by selling more oil, gas, and LNG at very high prices. The loser is the rest of the world, especially the Arab oil-producing countries, the EU, and India

What should investors and policymakers watch most closely now?

We want to see whether the war ends or not. This is really the major, major issue. And if the risk remains, then the problems will remain.

Big Businesses mentioned this week:

$GOOG ( ▼ 0.69% ) $DIS ( ▼ 0.55% ) $NFLX ( ▼ 0.16% ) $ORCL ( ▲ 2.66% ) $NVDA ( ▼ 0.66% ) $BA ( ▼ 0.82% ) $XOM ( ▼ 2.6% ) $TSLA ( ▲ 3.17% ) $CVX ( ▼ 1.09% ) $HAS ( ▲ 2.02% ) $MAT ( ▲ 0.08% ) $NVO ( ▼ 0.02% ) $HIMS ( ▼ 1.72% )

This week, big business!

The war story
The usual suspects
Trumplandia
Want more Cheddar?

The war story

This image provided by U.S. Central Command shows Navy sailors taxiing aircraft to a staging point on the flight deck of the USS Abraham Lincoln (CVN 72) in support of Operation Epic Fury, on Saturday, Feb. 28, 2026. (U.S. Navy via AP)

Flooding the Zone? Even an agreement to release 400 million barrels, or about four days' worth of global demand, on world markets did nothing to keep the price of oil down, indicating markets and business fear the war with Iran will continue unabated. The 32 member-countries of the International Energy Agency agreed to release the oil from their reserves, though they gave no timetable, to try to avert a supply shortage and price hikes. The benchmark Brent crude price fell briefly before climbing more than 7% to close just above $95 a barrel. That’s up 30% since Feb. 26, just before the Iran war began. That’s largely because there’s simply no end in sight to the turmoil and disruption. “There is still a distinct lack of progress in terms of actual de-escalation, or in terms of transit through the Strait of Hormuz resuming in any meaningful manner,” analyst Michael Brown of Pepperstone wrote in a note to clients.
Wild Ride: Oil has been bouncing like my eight-year-old on a trampoline, as investors try to The U.S. benchmark West Texas Intermediate has shot up by a third in the past month to $94.56 on Wednesday from $62.84 a month earlier, but with some wild swings, with both Brent crude and WTI hitting $119.5 a barrel in early trading on Monday, then plummeting, including a $11 drop on Tuesday from Monday’s close above $94 before shooting back up on Wednesday morning. Tuesday’s drop came after a post on X by U.S. Energy Secretary Chris Wright said the U.S. Navy had escorted a tanker out of the Gulf. The news was fake, and the post vanished in minutes, with the Administration walking it back and later blaming a social media staffer. But markets were left scratching their collective heads, and the Wall Street Journal reported that an unidentified oil futures ETF saw $84 million wiped off its market cap by the swing. Stocks have been a lot more stable - so far. Since markets opened after the U.S.and Israel first bombed Iran on Saturday, Feb 28, NY time, stocks have had some ups and downs on rumors the war might be quickly over, but after nearly two weeks, the S&P is down only 2.3%, while the Dow is down about 4% through midday Thursday.

Prices up at the pump: Diesel and gasoline prices are rising across the U.S. as the air war with Iran continues, pushing up shipping and travel costs, a bad sign for retailers, commuters, manufacturers, and airlines. For American consumers, the direct hit is to gasoline. The national average jumped to $3.578 per gallon on Wednesday from $2.937 a month ago. Diesel prices at the pump were up 25%, or 96 cents a gallon, through March 9, to $485, according to the U.S. Energy Information Administration, the largest ever weekly hike. Price hikes for aviation fuel were even higher, with European jet fuel rising 80% by March 6. European fliers won’t see price hikes right away, though, as most airlines there lock in prices using futures contracts. But U.S. airlines rarely hedge, and they will see a quick hit to their bottom lines. For merchant ships, the price hike was just as bad, with bunker fuel jumping 33% to $861 a metric ton since Feb 26. That’s added a surcharge of about $17 per container to international shipping, and the war’s left most shippers again avoiding the Suez Canal for the longer, more expensive trip around South Africa that caused the last logistics crisis, when Houthi missiles shut the Suez route two years ago.

U.S. National Average Gasoline Prices over the last 15 Trading Days. Image credit: Google Nano Banana Pro.

Russia’s energy rebound? Well, well, well, as they say in the oil business. One of the big winners in the nearly two-week-old U.S.-Israeli war on Iran is Russia, whose sanctioned oil is now trading above the price of benchmark crude. Despite sanctions, last year Russia was the world’s second-largest oil exporter, moving about 4.7 to 5 million barrels a day, behind Saudi Arabia’s 7.2 million and the U.S.’s 4.1 million a day. Russia’s benchmark Urals oil fell to about $85 a barrel on Wednesday, down 15% in a day, after peaking above $100 right after the war began, it’s still up 35% in a month. At 5 million barrels a day, today would have brought Russia’s state-controlled oil companies about $425 million. In one day. President Trump said he may lift oil sanctions on Russia to keep gas prices down, and the Treasury Secretary, Scott Bessent issued a 30-day sanctions waiver to let India buy Russian oil. "If you're a Russian oil trader or a Russian company, you have never earned as much money selling oil as right now because of this supply-chain interruption," Cornell professor and sanctions expert Nicholas Mulder told Axios.

The ops hire that onboards in 30 seconds.

Viktor is an AI coworker that lives in Slack, right where your team already works.

Message Viktor like a teammate: "pull last quarter's revenue by channel," or "build a dashboard for our board meeting."

Viktor connects to your tools, does the work, and delivers the actual report, spreadsheet, or dashboard. Not a summary. The real thing.

There’s no new software to adopt and no one to train.

Most teams start with one task. Within a week, Viktor is handling half of their ops.

Add Viktor to Slack for free.

END OF ADVERTISEMENT

The usual suspects

Who’s the leader of the club? It ain’t Mickey anymore. YouTube is the world’s largest media company now, with the Alphabet $GOOG ( ▼ 0.69% ) subsidiary posting $62 billion in revenue last year, topping Disney’s $DIS ( ▼ 0.55% ) media haul of $60.9 billion, according to financial research firm MoffettNathanson. That’s also well above Netflix’s $NFLX ( ▼ 0.16% ) $45.2 billion in revenue. The money is coming from ads (more than $40 billion) and subscriptions, and MoffettNathanson says YouTube has plenty of room to grow in the so-called creator economy. Meanwhile, in a move that might cut down some of its revenue, YouTube announced a tech pilot to identify deep-fakes of celebrities and politicians, possibly easing removal of the videos.
About that $WBD ( ▲ 1.84% ) Deal: A large part of the success of Paramount’s $PSKY ( ▼ 4.31% ) bid for Warner Bros. Discovery $WBD ( ▲ 1.84% ) relies on tens of billions of dollars of loans backed by the personal fortune of Larry Ellison, the Trump-buddy father of Paramount’s new CEO, David Ellison. Dad’s fortune comes from Oracle $ORCL ( ▲ 2.66% ) , the SaaS and cloud-computing firm that briefly made him wealthier than Elon Musk (for a day, last year). But Oracle’s stock has since plunged, and Ellison’s net worth, now at about $200 billion, is half what it once was, and alarm bells are sounding. The problem: Oracle is the only major player building or upgrading data centers with debt, and it’s also far behind the curve in hooking up its expensive Nvidia $NVDA ( ▼ 0.66% ) chips to actual electric power. That led OpenAI, which is investor-funded but also overstretched, to end plans to expand at Oracle’s Abilene, Texas, Stargate data center. Why? Because by the time it opens, Nvidia will have released a new and faster chip, CNBC reports, citing unidentified insiders. Oracle called the report “false” but offered no details. Oracle saw its shares bounce as much as 14% after releasing better-than-expected fourth-quarter earnings on Tuesday, but shares are still down 48% from their mid-September peak
Boeing’s Bad Wires: Boeing’s $BA ( ▼ 0.82% ) ongoing battle to deliver its jets faster and more safely (remember the door plug that fell off that 737 back in January 2024?) has hit a small snag. The company says it found some wiring was scratched in undelivered 737s and traced the problem back to a machining error. The company didn't give many more details, but the delay could put a crimp in Boeing’s plans to deliver 500 of the popular 737 this year. Quality control has been the key focus of CEO Kelly Ortberg. Boeing plans to reopen a production line at its main factory near Seattle to cope with pent-up demand. Boeing shares fell 3.2% when the wiring problem was announced.
Seems like Exxon $XOM ( ▼ 2.6% ) just couldn’t take the heat. The world’s second-largest oil company says it’s leaving the home state of Bruce Springsteen and the Sopranos because it just can’t take the kind of shareholder abuse that gets dished out in its current home state of New Jersey. CEO Darren Woods told The Wall Street Journal he wants to protect the company from shareholder “abuse.” Exxon moved its HQ to Texas from New York City in 1989. “Texas is already our operating home, and we think it makes sense to make it our legal home,” Woods said. Companies including Elon Musk’s Tesla $TSLA ( ▲ 3.17% ) and Exxon rival Chevron $CVX ( ▼ 1.09% ) have moved to Texas, which is working hard to rival Delaware as a home for U.S. corporations. In 2024 it opened a business court, and last year, it passed laws that make it harder for shareholders to sue board members of Texas corporations.
When times get tough, the tough start to play: That’s pushed up sales for toymakers, including Lego, the privately held Danish toymaker whose themed sets boosted sales 16%, while the overall toy market saw sales rise 7% last year. Hasbro $HAS ( ▲ 2.02% ) (Monopoly, Pay-Doh) saw revenue grow 12% last year, but Barbie-maker Mattel $MAT ( ▲ 0.08% ) saw profits and its share price plummet despite a 7% increase in revenue, with weak demand for its products.
A lego aircraft carrier, as opposed to the real kind.
No Swift Justice for Live Nation: It looks like ticket and event supremos Live Nation $LYV ( ▲ 0.24% ) will walk away relatively unscathed from an anti-trust trial, after reaching tentative agreement with the U.S. Justice Department that will avoid a breakup of the $25-billion a year company. Live Nation said it will allow more artists and competitors access to the venues it controls, and cap ticket fees at 15%. It also sets aside $280 million for states to reimburse consumers for those fees. Still, it doesn't address one big issue - Live Nation subsidiary Ticket Master’s stranglehold on ticket sales, and the knock-on effect when its computer system failed, delaying the 2022 rollout of Taylor Swift’s Eras Tour. Lawsuits from Swifties prompted the DoJ suit, but the fans are unlikely to get a rebate.
If you can’t beat ‘em: NovoNordisk $NVO ( ▼ 0.02% ) dropped its lawsuit against Hims&Hers Health $HIMS ( ▼ 1.72% ) , and agreed to sell its brand-name weight-loss drug Wegovy and its diabetes-treating companion drug Ozempic through the online pharmacy. Hims&Hers has used an FDA drug shortage exemption to market a compounded version of the GLP-1 drugs. The drugs will sell at Novo’s self-pay prices, from $149 to $499 a month, depending on dosage. HIMS shares were up a whopping 60% by midday Thursday. Novo’s shares are down 3.3% since the announcement.

Trumplandia

The Federal Reserve building in Washington, DC

The Fed’s Warsh Nightmare - It’s not looking good for Kevin Warsh, President Trump’s yet-to-be-confirmed nominee to take over as Fed chair. With recent dim employment figures, stubborn inflation, and the war on Iran with its skyrocketing oil and gas prices, Warsh is facing a dilemma. To tackle the Fed’s dual mandate of keeping employment high and prices low, he’s got just one tool: setting a benchmark interest rate. He can raise rates to fight inflation by making money harder to get (and spend); he can lower rates to boost spending and grow the economy (but that could create more inflation); or he could leave rates where they are and hope that the war fever winds down and the economy starts moving again. All while Trump wants Warsh to lead the Fed’s 12-member Open Market Committee on a mission to lower rates. “He’s got a perfect storm awaiting him here,” Troy Ludtka, senior U.S. economist at SMBC Nikko Securities, told CNBC. “We’ve got some significant stagflationary pressures, particularly from the manufacturing and goods sectors of the economy. This is coming at a time when it seems like we’re really beginning to see the consumer — I don’t want to say break — but maybe begin to break.”
Droning On: President Trump’s entrepreneurial sons, Eric and Don Jr. are taking a stake in a drone company that’s seeking contracts from the Pentagon, after the Trump Administration banned Chinese drones. Powerus, a drone roll-up based near Mar-a-Lago is merging with a publicly traded golf-course holding company backed by the Trumps, Powerus executives told the Wall Street Journal.

Want more Cheddar?

The three "economic shock channels" from the Iran war, apart from oil prices

Peter S. Green — Thu, 05 Mar 2026 21:30:00 +0000

U.S. sailors aboard the USS Abraham Lincoln marked ordinances headed for Iran with their names on Tuesday (U.S. Central Command)

The U.S. and Israeli bombing of Iran had a swift effect, if not on regime change, then at least on the global economy. Oil prices have shot up, home mortgage rates climbed back above 6%, and the specter of inflation returned. With President Donald Trump now saying the war could last four or five weeks, or perhaps “far longer than that,” Big Business This Week’s Peter Green sat down with Gregory Daco, chief economist at EY-Parthenon, an arm of the consulting firm formerly known as Ernst & Young, to discuss what happens next.

You outlined two scenarios for the conflict’s economic impact, one where a short war would have a moderate impact on the economy, and one where a prolonged war could have a severe impact. Where do those take us?

The moderate one would essentially see oil prices rise into the $80 range and gas prices rise around the 50-euro per megawatt hour range. The difference is that this moderate escalation scenario would see some persistence in the shock. We would be talking about prices in that range until the second half of the year and then some resumption to lower oil prices in the second half of 2026. A more severe scenario would entail further escalation in oil prices, further market volatility, and downward pressure on stocks alongside an appreciation of the U.S. dollar. In that scenario, oil prices would rise to $110 per barrel and last into 2027.

Beyond oil and energy, what other economic factors are likely to be affected?

It’s not just energy. Crude and natural gas are the two prime gauges of the uncertainty and the stress. But it’s also financial assets and financial market indicators. You would likely see a correction in terms of equity prices. You would likely see increased market volatility. You would see different degrees of U.S. dollar appreciation. And you would likely see movements in the 10-year yield. There’s an open question as to whether the dollar would play a safe haven refuge role in a severe scenario. Because so far it has not. Yields have risen when you typically would expect them to fall.

We’ll get back to the dollar, but why might bond yields rise during a global shock when they historically fell?

The economic paradigm today is heavily influenced by supply shocks, which is very different from pre-pandemic, where most of the shocks were essentially demand-driven. The results from supply shocks tend to be stagflationary. You tend to have higher inflation and lower output. Investors are pricing in higher inflation expectations. And in an environment where there are supply shocks, in part driven by the U.S., investors are looking to diversify their holdings. They’re not necessarily seeking refuge in dollar-denominated assets to the same extent that they once were.

Oil markets seemed oversupplied before the crisis. Why are prices suddenly spiking?

You start from a structural position of a surplus state. When you have a highly volatile situation in a region that is highly important in terms of production, refining, and transportation, then there start to be questions not just about stocks but about flows. If you have a stall of navigation in the Straits of Hormuz, that creates questions around flows. Markets and investors are trying to price what is happening in terms of these flows and what the risks are in terms of the provisioning of energy across the world. What you’re seeing is not necessarily the reflection of a sudden change in the stock picture. There are strategic reserves in China and the U.S., and other economies. There is crude currently on ships. It’s just a question of whether that is satisfying demand. As of right now, the answer is no. So, what we’re seeing is essentially a pricing of these flow disruptions.

Could this crisis disrupt global supply chains beyond energy?

It could. The main pressure point right now is transportation, and the potential impacts are disruptions to travel times and the cost of the fuel for the ships and trucks. If you increase distance and fuel costs more, that becomes an additional cost that will eventually be passed on to the consumer. So it’s not just about commodities. It’s a broader set of implications for transportation and for the cost of goods.

What channels transmit this shock into global growth and inflation?

There are three transmission channels:

The first is the cost of energy and commodities. Economies that are more energy dependent will see a greater hit.
The second is uncertainty and volatility. Businesses may hold off on investment or hiring decisions.
The third is the financial transmission channel. What happens to financial conditions? Is there a plunge in stock prices? Movements in the dollar? Dollar appreciation helps ease inflationary pressures in the U.S. but exacerbates inflationary pressures in other parts of the world. Europe would be a prime example.

Those three channels lead to divergent impacts on economic activity around the world.

How long might the economic effects last?

In the moderate scenario it’s a few quarters. You see a shock that lasts around three months and then dissipation over the remaining couple of quarters. The severe escalation is a multiyear process where you see a notable hit to growth and potential recessionary conditions across the world.

Big Businesses mentioned this week:

$WBD ( ▲ 1.84% ) $PSKY ( ▼ 4.31% ) $NFLX ( ▼ 0.16% ) $XYZ ( ▲ 1.14% ) $LYV ( ▲ 0.24% ) $JBS ( ▼ 0.76% ) $TSN ( ▼ 1.01% ) $SFD ( ▼ 0.24% ) $TGT ( ▼ 0.11% ) $LULU ( ▲ 2.54% )

This week, big business!

The usual suspects
The short stack
Trumplandia
Want more Cheddar?

The usual suspects

You can say one thing about Anthropic CEO Dario Amodei (pictured, above): He doesn’t back down. Faced with a threat from Defense Sec. Pete Hegseth, Amodei walked away last Friday from a lucrative government contract, refusing to let Anthropic’s models be used for mass surveillance in the U.S. or for building autonomous killing machines. OpenAI chief Sam Altman quickly jumped into Hegseth’s arms, promising cooperation. “We haven't given dictator-style praise to Trump (while Sam has), we have supported AI regulation which is against their agenda, we’ve told the truth about a number of AI policy issues (like job displacement), and we’ve actually held our red lines with integrity rather than colluding with them to produce ‘safety theater’,” Amodei said in a memo to employees. It doesn’t look like the move has hurt Anthropic, which is still a public benefit corporation. In fact, Anthropic is on track to generate nearly $20 billion in revenue this year, up from a $9 billion run rate at the end of 2025. Most of that’s down to businesses adopting Anthropic and its $211 a month Claude Code coding tool, while OpenAI chases consumers with $25 subscriptions to ChatGPT. Anthropic is valued at $380 billion, while Open AI is valued at $730 billion, and expects to lose $14 billion this year. Anthropic expects to be cash-flow positive next year.
Is Netflix the real winner in the Warner Bros. sale? The swift reversal on Friday by the board of Warner Bros Discovery $WBD ( ▲ 1.84% ) accepting a sweetened, debt-ridden offer from Larry and David Ellison’s Paramount Skydance $PSKY ( ▼ 4.31% ) looked like a loss for Netflix $NFLX ( ▼ 0.16% ) , whose all-cash offer for part of the company was rejected. But investors, at least, think Netflix did a Roadrunner and dodged an anvil, walking away from an $83 billion cash and debt deal. For one thing, it collected a $2.8 billion breakup fee, but more importantly, Netflix faces a simpler future with less regulatory threat to its 20% share of the U.S. streaming market (roughly equal to Amazon’s $AMZN ( ▲ 1.4% ) Prime Video). That sent Amazon shares up 14% on Friday after the breakup was announced. The deal will cause a lot of hurt in Hollywood, and could end up too much of a stretch for Paramount, whose market cap is just $13.75 billion, and which will be struggling to pay off $58 billion in debt from the WBD deal and a total debt load of $79 billion, with a newly reduced junk-level credit rating, all while hoping for $6 billion in “synergy” savings that has many WBD employees fearing for their careers, and some wishing that Netflix had won. That’s partly because Paramount has a lot more overlap with WBD. Who made out like a bandit? David Zaslav, for one, who put Warner and Discovery together in the first place, saw its share price tank until Netflix and Paramount began their bidding war. He’s cashing out just over 4 million shares for $114 million at $31 a share, according to an SEC filing listing the sale date as March 3, days after Paramount clinched the deal. “Merging with Paramount Skydance is like a shotgun wedding with your dumb cousin: I fear for the health of the kids,” producer Gregory Orr, a stepgrandson of Warner Bros founder Jack Warner told The Hollywood Reporter.
Is Jack Dorsey’s (pictured, above) layoff excuse too good to be true? Twitter founder Jack Dorsey said last week that Block $XYZ ( ▲ 1.14% ) , the payments firm he started, will fire 4,000 workers, 40% of its workforce, because AI can do their jobs better. AI-watchers wondered if this was a harbinger of an AI-powered unemployment apocalypse poised to sweep techland. Understandable, as it came just days after “the Citrini memo,” an AI-Doomsday thought experiment that momentarily sparked a mini market rout. But not everyone is buying the story. Instead, analysts say the company had over-hired massively, and its margins were hurting. Block's headcount jumped from about 3,000 in 2018 to nearly 13,000 in 2023. Meanwhile, net margins plummeted from 8% at the end of 2019, to -3% at the end of 2022. Layoffs began soon after, and Block’s profit margin topped 13% in the third quarter of 2025.
Live target: Sick of high ticket prices for your favorite band or your home team’s games? So is the Justice Dept., and this week prosecutors opened an anti-trust trial against Live Nation $LYV ( ▲ 0.24% ) , which through subsidiaries including Ticketmaster, has, the department says, exercised an extensive and illegal monopoly over live music and sports in the U.S. Live Nation’s size is no joke: Last year, it presented 55,000 events and sold 646 million tickets around the world. It owns or controls 460 venues and manages more than 300 artists. Among the accusations: that Live Nation pressures venues to sign exclusive ticketing deals, and forces artists to use its marketing arm if they want to play in its venues. Kid Rock is expected to be a government witness, but Live Nation is blaming any issues on the feds, who allowed it to merge with Ticketmaster in 2010. Shares in Live Nation are up 77% in 5 years and 16% in the past 12 months.

What If You Didn't Have to Push Yourself Anymore?

Imagine waking up Monday being pulled out of bed — not needing to pushing yourself out of it.

That pull isn't motivation. It isn't willpower. It's what happens when Tony Robbins conditions a different identity into your nervous system. An identity doesn't wait, doesn't hesitate, doesn't negotiate with itself.

That's what Unleash the Power Within does. It’s not inspiration. It’s Conditioning. The patterns that keep you hesitating, shrinking, and circling the same problems — Tony interrupts them at the root and installs new ones. You don't leave motivated. You leave re-wired differently.

4 days. Virtual. March 12–15. 5 million people across 195 countries have done this. It’s your time.

Save $100 by getting a ticket before March 6th. After that the price goes up. But the real cost is another year pushing instead of being pulled.

Ready to Rewire? Register Now.

END OF ADVERTISEMENT

The short stack

Chopped Meat: Ask a cattle rancher why it’s so hard to make money in the business, and he (or she, but most of them are men) will point to the Big Four meatpackers, Brazilian-owned JBS $JBS ( ▼ 0.76% ) , Cargill, Tyson $TSN ( ▼ 1.01% ) , and National Beef. Add Japanese-owned Smithfield $SFD ( ▼ 0.24% ) for pigs, and the big four have about 85% of the U.S. beef market and 65% of pork. That’s bad for ranchers who see cattle prices drop as the cost of feeding livestock rises. The U.S. Dept of Agriculture says reduced competition in meatpacking means lower prices for cattle. “This evidence is reflected in sharply increased spreads between cattle prices and wholesale beef prices,” the USDA wrote in 2024. Now, Sen.Charles Schumer (D-NY) is introducing a bill to slim down the meat-packing oligopoly.
I fought the law, and the law won. Or did it? On Monday, the Justice Dept. cried uncle, and said it wouldn’t fight a court ruling that President Trump’s executive order against Big Law firms was unconstitutional for threatening to revoke their security clearances and strip them of government business. Then on Tuesday, the Justice Dept. reversed itself and said it will fight the court ruling. The fate of the government’s appeal is now in the hands of a judge, but legal observers say it's unlikely the President's order will withstand scrutiny even at the Supreme Court. Still, nine Big Law firms bowed to Trump, even as four firms pursued the appeal.
A Target target? After 13 consecutive quarters of weak or falling sales, Target $TGT ( ▼ 0.11% ) finally has a plan, at least according to new CEO Michael Fiddelke. The plan: Spend $6 billion on stores, workers, and technology, slim the corporate workforce and add store associates, and revamp some of its fading categories, with a renewed emphasis on groceries. Will it work? Shares shot up 6.7% on Tuesday after Fiddelke’s announcement, but sales were down again in the quarter ending Jan 31, this time by 2.5%, and the share price has dropped more than 55% since a 2022 high.

When life gives you Lululemon, make Lululemonade. Lululemon $LULU ( ▲ 2.54% ) founder Chip Wilson is at war with the company’s board, which he says lacks the marketing and creative expertise to revive the fading athleisure brand. Wilson is the firm’s largest individual shareholder, with more than 8% of the company. The company says it’s been engaging with Wilson, and has pledged more transparency, but Wilson notes the company hasn’t recovered from a second see-through leggings fiasco earlier this year.

Trumplandia

The Iran War by Numbers (since Feb. 28):

Airline stocks (NYSE Arca Global Airline Index Since 2/26)	Down 11.2 percent
S&P 500 (Since 2/25) $SPX ( ▲ 0.81% )	Down 2%
Oil and Gas stocks Dow Jones U.S. Oil & Gas Index (SJUSEN)	Down 1% Since March 2
Brent Crude	+22% ($82/barrell)
Gas price HHW00	Up 1.73% since Friday
Dow Jones Industrials.DJI	Down 2.45% since 2/27
Mortgage rates (Bankrate)	Up 0.05 points to 6.15% this week

And…about those tariffs: International tariffs just rose 50% to 15% across the board, front the 10% duty Trump imposed on all imports after the Supreme Court’s February dismissal of his more onerous emergency tariffs. This time, Trump is using a rule that allows him to place duties on imports for 150 days, in order to reduce the balance of payments deficit. On Wednesday a judge ruled that the administration must begin repaying $130 billion in tariff payments from international companies, but the administration is expected to appeal.

Want more Cheddar?

Will tariff policy ever stabilize enough so that big business can plan?

Peter S. Green — Thu, 26 Feb 2026 21:30:00 +0000

It was hardly unexpected. The Supreme Court’s ruling last Friday that President Donald Trump had no authority to issue his “Liberation Day” tariffs has thrown the U.S.’s global trade relations into turmoil, with trading partners, importers and U.S. companies unsure which tariffs apply to what, and whether they will get back the $130 billion or more that they paid the U.S. Treasury to comply with the duties imposed under the International Emergency Economic Powers Act (IEEPA).

“We are exactly where we thought we would be,” said Rebecca Homkes, a consulting economist and lecturer at the London Business School. Without the IEEPA, Trump announced he was imposing blanket tariffs of up to 15% on all goods coming into the country, using a trade tool called Section 122, which may have its own legal issues. It’s designed to combat balance of payments problems, and can only stay in place for 150 days, before Congress has to reauthorize the tariffs, something it’s unlikely to do with mid-term elections coming in the Fall.

Source: YouGov

Companies are either suing the government or working with advisors to figure out how big a refund they are owed. But Homkes says it’s unlikely the consumers will see either rebates or lower prices from the IEEPA rollback. “I would highly doubt they ever will,” she said. “We are still in an environment of pretty heightened volatility.”

The good news is that after a year of tariffs, economists are discovering that prices don’t necessarily shoot up, though not necessarily for good reasons. “Tariffs can reduce growth, but they tend to not raise prices in the long term in the next year or so because growth slows sufficiently that higher prices are hard to pass through,” Jose Rasco, chief investment officer for HSBC Global Private Banking and Wealth Management, Americas, told BBTW. Still, he says the tariffs are coming at a time when the economy is booming for other reasons, so they can’t slow it down that much.

“We're going to focus on the fundamentals and the fundamentals, accelerating economic growth, inflation that is not at the Fed's level of growth, but is well contained, and earnings that are accelerating at almost double the rate of the historic average, sign me up for that any day,” said Rasco. “So I think, you know, fixed income looks good. Equities look really good. We're just in the middle of a repricing of AI, which I think will work out by the end of the first quarter.”

Lawyers are urging importers to get their refund claims in now, while the trade court is waiting to give its ruling on refunds. “That is the question on everybody's mind, how to get refunds,” said Lizbeth Levinson, co-chair of the international trade practice group at law firm Fox Rothschild in Washington. “I'm recommending what I call the belt and suspenders approach; they should file a suit even now,” she said, and not wait for a court ruling.

Figuring out what that refund should be is massively complex, said Emil Stefanutti, CEO of Gaia Dynamics, a company that uses AI tools to help importers calculate duties. The U.S. uses 22,000 different product codes for imports, and each component of an imported product may have a different tariff rate. Where it gets really messy is with, say, a car part made with a chip from Taiwan, a lightbulb from Vietnam, and wiring from Thailand, all put together in China and installed into a car in Mexico.

Source: The Cato Institute

It may take several years to settle the refunds, from the government reviewing claims to expected resistance from President Trump, who said tariffs could replace nearly all the government's revenue from income tax. But the real disruption will come from the ongoing uncertainty, said Stefanutti, who works closely with firms navigating tariff and import duties.

“Whatever you had planned, whatever you thought you knew is changed,” he said. The Liberation Day tariffs had already upset companies’ expectations. “They plan for the year, they know the pricing, they know what kind of sourcing strategies they're going to use, and now they have to recalculate again. It’s taxing, no pun intended, for companies to keep up with this,” he said.

“The real question isn't whether tariffs exist or will keep existing, it's whether policy stabilizes enough for companies to plan around it. The volatility that exists is very hard to predict, and I think companies are realizing that the era of frictionless global trade is over,” he said.

Big Businesses mentioned this week:

$NFLX ( ▼ 0.16% ) $WBD ( ▲ 1.84% ) $PSKY ( ▼ 4.31% ) $NVO ( ▼ 0.02% ) $LLYZ ( ▲ 0.28% ) $BBAI ( ▲ 0.3% ) $UBER ( ▲ 1.02% ) $BKNG ( ▲ 0.71% ) $DASH ( ▲ 1.58% ) $AXP ( ▲ 3.07% ) $AAL ( ▲ 3.27% ) $GRAL ( ▲ 8.06% ) $MSFT ( ▲ 0.27% ) $AMLX ( ▲ 2.8% ) $NVDA ( ▼ 0.54% ) $MBG ( ▲ 0.09% ) $STLA ( ▼ 1.3% ) $GOOG ( ▼ 0.69% ) $AMD ( ▲ 5.67% ) $META ( ▲ 4.7% ) $CRWV ( ▼ 0.33% ) $SAVEQ ( ▲ 0.43% )

This week, big business!

The usual suspects
Want more Cheddar?

Chips on the shoulder

Anthropic and Pentagon battle over Kill Switch: What do you do when the Pentagon says “Fire”? That’s the challenge for Anthropic, the self-professed ethical AI company, which said the Pentagon can’t use Anthropic software for autonomous killing machines or mass domestic surveillance. Defense Sec. Pete Hegseth summoned Anthropic CEO Dario Amodei to the Pentagon on Tuesday and issued an apparently contradictory ultimatum: If Anthropic doesn’t bend by Friday, the Defense Dept. will both label the company a supply chain risk, banning it from being used by the military and any military contractor, and at the same time invoke the Defense Production Act, effectively nationalizing the company — or at least its Claude AI software — so the military can use it without the company’s consent. The standoff comes at a pivotal moment for the AI industry. Anthropic is the only AI provider that has so far been approved for use in classified settings, but as AI technology far outpaces government regulation, Anthropic has set its own guardrails. Those rules limit what the Pentagon wants to do, hence the standoff. As Dean Ball, a former Trump AI adviser, warned, the Pentagon’s stand could hurt both the military and Anthropic, calling Hegseth’s threat “incoherent.”

DeepSeek or DeepFake? China’s DeepSeek, which claimed to have used an array of lower-grade silicon chips and home-grown ingenuity to match the capabilities of the most advanced U.S. AI models for a fraction of the cost, was actually built and trained with Nvidia’s $NVDA ( ▼ 0.66% ) most sophisticated AI processor, the Blackwell, an unidentified Trump Administration official told Reuters. Nvidia’s stock fell 17% on the day in January 2025, when DeepSeek announced its supposed breakthrough, as investors questioned whether Nvidia’s high-cost, high-margin AI chips would find a market. The U.S. official did not say how China obtained the Blackwells, which are barred from export to China. Both Nvidia and the U.S. Commerce Dept. declined to comment on how the chips might have gotten to China. The official said DeepSeek was probably trained by having OpenAI, Anthropic and other AI models vet its responses. White House AI chief David Sacks and Nvidia CEO Jensen Huang have argued that the U.S. should allow China access to advanced U.S. AI tech to keep it from developing its own chips.
The circularity continues: Desperate to catch up with booming rival Nvidia $NVDA ( ▼ 0.66% ) , chipmaker AMD $AMD ( ▲ 5.67% ) has been selling off parts of itself to potential customers. After selling a stake to OpenAI in exchange for chips, Meta $META ( ▲ 4.7% ) will now buy chips from AMD and get a stake in the company of up to 10%. It’s the reverse of what cash-rich rival Nvidia is doing. Nvidia has been buying stakes in its clients, OpenAI, xAI and data center developer CoreWeave $CRWV ( ▼ 0.33% ) , who use the cash to buy Nvidia chips. AMD’s stock rose 6% on news of the deal.
What if… Oooops! A thought experiment by a 30-year old stock analyst sent real-life tech stocks tumbling briefly on Monday, after it described a potential future where AI had sent unemployment soaring, gutted software companies, and sent shockwaves through financial markets, as an Occupy Silicon Valley movement protested outside the office of OpenAI and Anthropic. “What if our AI bullishness continues to be right...and what if that’s actually bearish,” Citrini Research published in a Substack post that went viral. The note said that it’s describing “a scenario, not a prediction. This isn’t bear porn or AI doomer fan-fiction.” Even so, some Wall Streeteers said the note was a necessary warning. “I don’t think it’s necessarily going to play out as they see it, but it’s a bit of a wake-up call that the economy already no longer resembles the one just a few years ago,” Neil Wilson, an analyst at Saxo Capital Markets, told the Guardian.

Scale Your IRL Campaigns Like Digital Ads

Out Of Home advertising has long been effective but hard to scale—until now. AdQuick makes it simple to plan, deploy, and measure campaigns with the same efficiency and insight you expect from online marketing tools.

Marketers agree: OOH is powerful for brand growth, driving new customers, and reinforcing messaging. AdQuick makes it easy, intuitive, and data-driven—so you can treat real-world campaigns like any other digital channel.

Learn more, visit AdQuick.com

END OF ADVERTISEMENT

The usual suspects

Weakened Spirit: That tiny yellow dot on the horizon? That’s all that’s left of Spirit Airlines $SAVEQ ( ▲ 0.43% ) , after the failing budget carrier said it’s near agreement with its creditors. Nearly all flights will touch one of four hubs: New York, Detroit, Fort Lauderdale, or Orlando. Fewer U.S.-based passengers are risking flights to see family in Latin America, putting a big dent in the airline’s Central and South American flight plans. And expect fewer flights on low-demand Tuesdays and Wednesdays. With fewer flights and fewer planes (and fewer crew members), Spirit will cut its debt load to $2.1 billion from $7.4 billion. And if the company can emerge from bankruptcy, a merger could be in the cards, its attorney told CNBC.
Cheaper Glutamides! NovoNordisk $NVO ( ▼ 0.02% ) says it's slashing prices for weight-loss drugs Ozempic and Wegovy as it ramps up a price war with rival Eli Lilly’s $LLY ( ▲ 0.09% ) Zepbound for a global market that could reach $139 billion by 2030. Both Ozempic and Wegovy will list for $675 a month, from next January - that’s a 50% cut for Wegovy and a 34% cut for Ozempic, which is focused on diabetes. Zepbound retails online for about $299 a month. The price cuts are aimed at the increasing number of people who need the weight loss drugs but who lack insurance that covers the cost.
Boeing’s Boost: Recovering U.S. planemaker Boeing $BA ( ▼ 0.82% ) has secured $30B worth of orders from three different Vietnamese airlines for nearly 100 jets. The Boeing buy is part of a proposed trade deal that would lower tariffs on Vietnamese imports to the U.S., which are stuck now at 20%. In 1997, Boeing bought McDonnell-Douglas, the plane maker that manufactured the A4E Skyhawk, the plane the late Sen. John McCain was flying when he was shot down by North Vietnamese forces during the Vietnam War.

Do you have a reservation?

Reservation Wars: Book a table or order in - Now you can do it all on Uber Eats $UBER ( ▲ 1.02% ) , as the restaurant reservation wars heat up. Last year, Uber Eats partnered with Booking Holdings’ $BKNG ( ▲ 0.71% ) Open Table (60,000 restaurants) and DoorDash $DASH ( ▲ 1.58% ) paid $1.2 billion to buy booking platform SevenRooms. In 2024, American Express $AXP ( ▲ 3.07% ) , which already owned Resy (20,000 restaurants), bought upscale-focused reservations app Tock (5,000 restaurants) for $400 million. Industry watchers expect the three firms to start an all-out war this year with price incentives and loyalty perks as each attempts to corner the market. “It’s three very large, very ambitious, very well-resourced companies all vying for the same exact piece of real estate, which is high-demand restaurants,” Resy and Eater founder Ben Leventhal told CNBC. DoorDash is expected to lead the shakeup. It’s got about 63% of the delivery market, to Uber Eats’ 25%, and Grubhub’s 6%. SevenRooms claims more than 15,000 restaurants worldwide use its service. Last year, Uber sued DoorDash saying it was strong-arming restaurants into dropping Uber Eats. DoorDash called the suit “a cynical and calculated scare tactic from a frustrated competitor.”
Never-ending story: Is Netflix $NFLX ( ▼ 0.16% ) about to lose its bid for Warner Bros. Discovery $WBD ( ▲ 1.84% ) ? It looks like the ball is back in play after Paramount Skydance $PSKY ( ▼ 4.31% ) upped its offer for WBD by $1 a share, and promised to pay off Netflix if the streaming giant gets jilted by WBD shareholders. Those shareholders vote on March 20 on whether to accept the Netflix deal, which applies only to the studio and streaming assets, leaving CNN and other linear channels ready for a spinoff. Netflix is offering to buy the studios and HBO Max for $27.75 a share, or $72 billion. The prior bid from Paramount was $30 a share, or $77.9 billion, for the entire company, including its cable networks CNN and TNT. The deal is no financial stretch for Netflix, with its market cap of $350 billion. Paramount’s market cap, at $11.2 billion, means it will load the company with a mountain of debt to complete the deal, and David’s Dad, Oracle founder Larry Ellison, has promised to backstop the bid. Talks with both sides will continue, but Paramount’s board said there’s no guarantee it will find the Ellisons' bid “superior,” and “continues to recommend” the Netflix offer. President Donald Trump himself jumped into the fray this week, telling Netflix to dump board member Susan Rice, a former Obama national security adviser. That’s because Rice told podcaster and former U.S. Attorney Preet Bharara that when Democrats regain power, they shouldn’t “forgive or forget” corporations that “bent the knee” to Trump. “Netflix should fire racist, Trump Deranged Susan Rice, IMMEDIATELY, or pay the consequences,” Trump wrote on Truth Social, atop a repost of a post by Trumpfluencer Laura Loomer.

Marilyn Monroe: Liked diamonds. Investors? Not so much…

Diamonds are definitely not an investor’s best friend. Don't listen to Marilyn. Global mining giant AngloAmerican $AAL ( ▲ 3.27% ) wrote down the value of its De Beers diamond business by half to $2.3 billion, the third cut in three years, as the Chinese market cools and lovers across the globe opt for increasingly realistic—and cheap—synthetic diamonds. The company is now worth about a quarter of what it was three years ago. Last year, the De Beers unit booked a loss of nearly $500 million. De Beers is looking to spin off the diamond business this year. Diamond prices have fallen from a high of over $8,000 a carat in 2012 to just over $4,000 today.
The Unholy Grail fail: It was supposed to be the answer to many of the world’s medical problems: A simple blood test, developed by a medtech startup Grail $GRAL ( ▲ 8.06% ) , would detect cancer long before other tests, extending lives and slashing care costs by allowing patients to be treated long before they had visible symptoms. But a three-year study of 142,000 British adults showed no significant reduction in early cancer detection. Some 185,000 of the tests were sold in the U.S. last year, bringing in revenue of $136.8 million, but Grail lost $408 million. When word of the test results came out, the stock lost 58% of its value. Still, it’s more than tripled in value since September, and it recovered slightly this week. Despite the failure of the UK test, analysts say a few more years of data could show some efficacy, letting the test win FDA approval, which could make it eligible for Medicare reimbursement.
Seahawks for Sale? Fresh off their crushing defeat of the New England Patriots in Super Bowl LX, the Seattle Seahawks are up for sale. That’s not an unexpected move: The team was owned by Microsoft $MSFT ( ▲ 0.27% ) co-founder Paul Allen from 1997 until his death in 2018. Since then, it’s been owned by Allen’s estate, which his sister Jody Allen has been slowly winding down as she donates the proceeds to charity. Before their Super Bowl win, the Seahawks were valued at about $7 billion according to a CNBC ranking, ranking them 19th in the NFL by value, with 2024 revenue of $638 million. The question is, of course, what they’re worth now?

Aston Martin: Was this photo taken approximately the last time the company made a profit?

You only live, er…thrice? Aston Martin $AMGDF ( ▲ 5.44% ) , makers of the famous James Bond car with the ejector seat, laid off 20% of its workforce, saying U.S. tariffs were killing its business. Aston Martin sold just 5,448 cars in 2025, down 10% from 2024. It lost 363.9 million pounds last year, down from a 289.1 million pound loss in 2024. The U.S. is Aston Martin's largest single market, but only 25,000 UK-made cars are allowed into the U.S. every quarter, on a first-come first-serve basis. Shares are down 50% in the past year.
Wayve g’bye, Tesla $TSLA ( ▲ 3.17% ) : Wayve, a UK-based maker of self-driving software, says it’s raised $1.2 billion from investors including Softbank $SFTBY ( ▲ 3.2% ) , Microsoft $MSFT ( ▲ 0.27% ) , Nvidia $NVDA ( ▼ 0.66% ) , Uber $UBER ( ▲ 1.02% ) , and automakers Mercedes $MBGAF ( ▼ 1.26% ) Nissan $NSANY ( ▼ 2.32% ) , and Stellantis $STLA ( ▼ 1.3% ) . The raise values Wayve at $8.6 billion. Wayve isn't building its own cars like Tesla, or deploying fleets of self-driving taxis like Alphabet's $GOOGL ( ▼ 0.84% ) Waymo. Instead, carmakers incorporate Wayve’s software into their vehicles.