Category: Protected – Watson’s Daily

House of Representatives approves ‘big, beautiful bill’ in victory for Donald Trump (Financial Times, James Politi, Lauren Fedor and Myles McCormick) shows that Trump managed to get his flagship tax and spend legislation through the House of Representatives in a 218 to 214 vote, quashing rebellion along the way. The bill continues the tax cuts Trump implemented in his first term and dismantles Biden’s tax credits for clean energy. There are big cuts to Medicaid and other social welfare programmes along with an increase in military spending and a crackdown in immigration. Donald Trump’s ‘big, beautiful bill’ provides windfall for US immigration crackdown (Financial Times, Guy Chazan) highlights what the White House boasted as being the “largest investment in border security in a generation” that would channel “nearly $150bn to secure our border and deport illegal aliens”. Somewhat incredibly, the sum that will be allocated to the US Immigration and Customs Enforcement (ICE) will be more money on an annual basis combined for the next four years than the budges of the FBI, DEA, Bureau of Alcohol, Tobacco, Firearms and Explosives, the US Marshals Service and the Federal Bureau of Prisons. And for good measure, it’s nigh on double the UK’s defence budget 😱! This means that ICE will be able to hire 10,000 agents, 5,000 customs officers and 3,000 border patrol agents. Since Trump took the reins at the White House in January, ICE has deported over 200,000 people. Clearly, more immigration raids are going to happen across the country…Meanwhile, The Corporate Winners and Losers in Trump’s Big Tax Bill (Wall Street Journal) highlights winners in the bill as including fossil fuel companies (they can buy more public land in Alaska and the Gulf of Mexico, lower royalty rates), Silicon Valley investors (they can sell more of their holdings early without having to pay CGT), chipmakers (higher tax credits for new plants), defence contractors (loads more big projects, including the Golden Dome), airlines (money going towards overhauling the air traffic control system), private schools (tax credits for those attending private schools), sports team owners (averted a financial hit involving deductions for intangible assets), private equity (avoided having to pay tax on carried interest income), manufacturers (they’ll get tax breaks to help domestic manufacturing), real estate developers (preserves and broadens existing tax breaks for commercial and real estate investors and developers), private student lenders (lower federal student-loan caps which means that more students will have to borrow money) and retailers (no change to corporate income tax rate). Losers include AI and tech companies (AI will be subject to state-level regulation), EVs (no more subsidies), solar and wind (developers won’t be able to qualify for special tax credits in 12 months’ time), shippers and online retailers (end of the de minimis rule), food companies (cuts to America’s food stamp programme), universities (annual investment income gets taxed, although small colleges are exempt) and hospitals (states won’t be able to boost Medicaid payments to hospitals). Trump has dropped a big, beautiful bomb on America’s economy (Daily Telegraph, Ambrose Evans-Pritchard) contends that the bill has effectively handed China global leadership of the electro-tech revolution and “much of the future global market for cars, trucks, short-haul aviation, home heating and cooling, smart grids, power storage” as well as products that deliver cheap energy. People at think tank Ember estimate that China is electrifying its economy at about 10 percentage points every ten years – and it’s already broken through 30% while the US has been in the low 20s since 2008 thanks to the fracking boom. America is now doubling down on fossil fuels and trying to force the likes of Japan, South Korea and Europe to increase imports of US LNG while Trump is trying to force the EU to change its laws to accommodate. Fun facts: two-thirds of of fossil energy is lost to the atmosphere in the form of heat whereas about 90% of electric energy is used in its final function. Meanwhile, Trump’s bill is actively hobbling new technologies with the exception of geothermal and nuclear fusion. Energy Innovation reckons that the bill will mean that America will generate 340gigawatts less over the next ten years and push wholesale electricity prices 74% higher. This could mean that there won’t be enough electricity to meet new data centre demand, which will limit America’s AI ambitions. He’s also torpedoing America’s EV industry at a time when China makes 75% of the world’s electric batteries and 70% of its EVs. * SO WHAT? * In a world where 80% of the population inhabit countries that are net importers of fossil fuels, the incentives to wean themselves off in favour of much cheaper – and cleaner – electricity will only grow over time. Until then, they’ll buy Chinese solar panels (which are cheap currently – and will get cheaper!), drive around in Chinese EVs and ultimately wean themselves off fossil fuels leaving America carrying the fossil fuel jerrycan. Oil producing countries, like Saudi Arabia, are already

using oil revenues to wean themselves off fossil fuels – so it seems ironic that America’s looking to go in the opposite direction. Has Trump just dropped a big beautiful bomb on the future prospects of his own country? As far as the rest of the BBB goes, I have to say that I think that the gargantuan increase in funding for ICE is at once pretty incredible but also frightening. It feels like Trump’s America is turning in on itself and making itself an echo chamber for the administration whilst also using force to make other countries bend to its will using a combination of tariff and defence threats. Ultimately, this will mean that countries will not trust America, will increasingly exclude it as much as possible and become much more self-reliant. Although this won’t be possible in the short term, I think that in the longer term this is the direction that governments will be aiming. In a way, maybe Trump has inadvertently done the whole world a favour. For the next few years, though, I think it’ll be a rocky ride for all concerned.

Elsewhere, Trump tries to sell rice to the Japanese (Daily Telegraph, Hans van Leeuwen) highlights the president’s attempt to make Tokyo buy more American rice. Earlier this week, Trump said on Truth Social that “Japan, they won’t take our RICE, and yet they have a massive rice shortage” and later branded the Japanese people as “spoilt” for not taking American rice. This has been a major hurdle to broader trade negotiations. Rice prices have quadrupled over the last year thanks to a heatwave-hit harvest, rising demand from restaurants who are seeing more tourists and panic buying. * SO WHAT? * One thing I learned (among many other things!) from my years of living in Japan was just how seriously Japanese take their rice. When I was a student (yes, it was a loooooong time ago!), I remember that there was a harvest problem and there were bags and bags of cheap Thai rice at the supermarkets that seemed to be untouched next to the empty spaces where the Japanese rice would have been. I seem to remember that the bags of Japanese rice were many times more expensive (I think almost ten times, but my memory could have faded on that) than the Thai rice but it seemed that Japanese just wouldn’t touch it. Also, it is a right of passage for pretty much all school kids to go on school trips to rice paddies to see how rice is grown and harvested and there is even a saying that exhorts people not to waste it – “in a grain of rice lives seven gods” – so you can see where all this comes from. Still, America can grow quite decent rice (California is known for its “japonica” rice that closely resembles what you get in Japan) but I think it could be a harder sell than Trump thinks given how much national fervour is stirred when it comes to rice. In a way, I think that the government should cave on this in order to get a trade deal done because it may well be that the Japanese public is so incensed by Trump’s treatment that they won’t buy it as a matter of principle.

Then in US jobs growth beats expectations in June (The Times, Louisa Clarence-Smith and Simon Freeman) we see that the US Department of Labor released strong jobs data yesterday, which prompted optimism about the US economy and lifted markets. Unemployment fell from 4.2% to 4.1% while average earnings increased by 0.2% month-on-month. * SO WHAT? * At the moment, it seems that the negative effects of Trump’s tariffs are so far not as bad as everyone has expected and you would have thought that his new bill will prompt growth at least in the short term (although it will surely increase the country’s debt). Things certainly seem to be going Trump’s way at the moment…

Back home, Markets rally after Starmer says Reeves to remain chancellor and backs fiscal rules (Financial Times, Ian Smith, Jim Pickard and Emily Herbert) shows that bond markets recovered after Reeves’s wobble the other day following reassurances by Starmer that she’d be the chancellor for a “very long time to come”. Investor fright over Reeves’ tears shows fragility of UK finances (Financial Times, Ian Smith, Sam Fleming, Jim Pickard, Harriet Clarfelt and Kate Duguid) says that the market reaction highlights just how fragile investor confidence is regarding our country’s finances.

UK services sector grows at fastest rate in 10 months (The Times, Mehreen Khan) sounds a positive note as the latest services sector PMI showed that output hit a ten-month high thanks to more new orders. This may embolden the Bank of England to cut interest rates, something that markets are expecting at the Bank of England’s meeting in August. It looks like things are recovering after the shock of April…

In Chip software makers say US restrictions on sales to China lifted (Financial Times, Thomas Hale and Christian Davies) we see that the US has now removed recent restrictions imposed on sales to China thanks to a US-China trade deal. The US government told Siemens, Synopsys and Cadence – who together account for 80% of China’s market for electronic design automation software which is used to develop new semiconductors – that exports restrictions imposed in May had been lifted. * SO WHAT? * This is good news for the companies, but you would have thought that Chinese rivals will be innovating like mad to make sure they don’t get caught out again! The software ban had been in response to China cutting down on the shipment of rare earths. This may ease the proposed $35bn merger between Synopsys and engineering software developer Ansys because Chinese regulators had been dragging their feet in response to America’s ban on chip design software sales to China.

Then in Dinosaurs to doctors’ records: the UK weighs up its data assets (Financial Times, Lex) we see that the UK government is in a bit of a quandary at the moment because it wants to sell anonymised public data. However, pricing it is difficult because it has different value to different buyers and timing can also have an impact (newer data is generally more valuable than older data). One way that is popular with the likes of Bloomberg, Nielsen and Gartner is the subscription model. However, this doesn’t take all the costs of collating that information and interpreting it into consideration so there is an argument for some kind of marketplace/exchange. There are various such exchanges in China, like the Guiyang Global Big Data Exchange, but there’s also the possibility that Big Tech companies could get involved as well. Given their expertise at splicing and dicing data, perhaps it would be better to supply the data to these companies who can do more with it than the UK government can. That is assuming, of course, that there are no security issues!

Shein hit with €40mn fine in France over misleading discounts (Financial Times, Adrienne Klasa and Barbara Moens) shows that Shein has just been slapped with a €40m penalty by French regulators for misleading consumers on price cuts and environmental commitments. The regulator came to this conclusion after an 11-month investigation. * SO WHAT? * Although this is a record fine, the fact that it made $1bn in net profit from revenues of $38bn in 2024 puts the $40m fine into context. I’m guessing that Shein will just shrug its shoulders at this and carry on with plans for its mega-flotation in Hong Kong. That being said, Shein is at the centre of many investigations going on in Europe. As you know, I have been sceptical about Shein’s flotation in London because I think that it is a massive litigation risk – so when it turned out that it was going to list in Hong Kong I thought we’d dodged a bullet.

Meanwhile, in Watches of Switzerland posts record revenue but profits slide (The Times, Isabella Fish) we see that it was a bit of a mixed bag for the posh watch seller as it reported a record year for sales on the one hand but then warned that profit margins would be hit by US tariffs on the other. Overall it expected adjusted earnings for the year to be flattish. All of the brands it sells – including the likes of Rolex, Patek Philippe, Omega and Tag Heuer – had increased prices in the mid-single digits. * SO WHAT? * It seems that there was underlying strength in trading powered by demand for Rolex watches and US growth. It’s doing OK at the moment, but I guess a lot will depend on consumer confidence and more people travelling.

In a quick scoot around some of today’s other interesting stories, Electric cars sales account for a quarter of UK registrations (The Times, Robert Lea) cites the latest figures from the New AutoMotive consultancy, which came out before the SMMT’s data release, which show that 25% of new cars registered in June ran only on electric batteries. This has been helped by bigger monthly shipments from Tesla, growing competition from the Chinese and legacy European carmakers upping the ante on EV production. It’s estimated that there are over 100 all-electric car models currently on the market. Tesla is still the market leader but BMW and VW are close behind!

Then in First-time buyers turn from rural areas to Britain’s regional cities (The Guardian, Rupert Jones) we see that there’s an interesting change of consumer behaviour taking place, according to the interpretation of data from Rightmove! The analysis suggests that the number of would-be first-time buyers in Great Britain seeking to move to cities is up by a chunky 16% on average versus the same period in 2015. After the escape to the countryside under lockdown, it seems that people are increasingly succumbing to the pull of the cities. The top five were Dundee, Edinburgh, Doncaster, Liverpool and Plymouth.

I have to say I’m not convinced about this – frying pasta dry before you put the water/stock in – but I have pan-fried gnocchi before and that was a revelation! BTW, I’ve never put stock in pasta either (always salted water). What do you reckon? Yay or nay??

Donald Trump’s tax bill on the brink as House rebels hold up passage (Financial Times, Lauren Fedor, Myles McCormick and James Politi) highlights a late rebellion in the House of Representatives from critics in his own party. Trump met with dissenters and said that he believed the bill would all go through but it’s still unclear as to whether these people have changed their mind. Given the narrow majority in the House, Republicans can only afford to lose three votes. Trump said, in capital letters no less, in a Truth Social post yesterday that “IF PASSED, AMERICA WILL HAVE AN ECONOMIC RENAISSANCE LIKE NEVER BEFORE”.

Then in Donald Trump announces 20% tariff in trade agreement with Vietnam (The Times, Robert Miller) we see that the president struck a trade agreement with Vietnam whereby the country will be slapped with a minimum 20% tariff whilst also giving more access to American products with zero tariffs. * SO WHAT? * Initially, US companies with a big footprint in Vietnam – including Nike – saw share prices rise but then they fell off when he added more details. 20% is more than expected but at least it’s not the 46% it could have been…prices of shoes and clothing exported from Vietnam to the US are likely to rise as a result of this if the terms of the agreement are confirmed.

Meanwhile, EU blocks Britain’s attempts to join pan-European trading bloc (Financial Times, Peter Foster and Andy Bounds) shows that Brussels is digging its heels in with regard to not letting the UK join the Pan-Euro-Mediterranean (PEM) convention. The PEM is an agreement between the EU and 20 other countries in Africa and the Middle East and the UK’s entry has been supported by various trade groups, including the British Chambers of Commerce because they think it could help goods exporters. However, joining this would involve rewriting the terms of the existing post-Brexit EU-UK trade deal, so it’s a no go at least for now…

Starmer moves to bolster Reeves after tearful Commons episode fuels bonds slump (Financial Times, George Parker, David Sheppard, Ian Smith and Jim Pickard) shows that Starmer eventually backed up his chancellor by reiterating that she will stay in her position for “a very long time to come” after a nervy performance in the Commons following the welfare bill disaster. Badenoch went for the jugular in a heated exchange and Starmer initially refused to say how long Reeves would remain in her role. * SO WHAT? * Investors got nervy because the prospect of a new chancellor would mean more uncertainty at a very tricky time but Starmer’s eventual show of solidarity calmed things down once more. He said that her shaky performance was down to personal reasons and was nothing to do with anything political.

Talking of the welfare bill, Where does the welfare bill climbdown leave UK public finances? (The Guardian, Heather Stewart) says that now the bill that was supposed to save £5bn has been torpedoed and the winter fuel allowance has been restored, Reeves is going to have to find £6.25bn from somewhere – and everyone reckons that’s going to be from higher taxes. Which UK taxes are expected to rise in the autumn Budget? (Financial Times, Sam Fleming and George Parker) suggests that she could extend the freeze on personal tax thresholds beyond 2028, which the IFS reckons could raise £9.2bn; she could raise corporation tax by a percentage point, which could raise £4bn in 2028-29; and the left of the party says she should introduce a “wealth tax”, but no-one knows what that would look like. * SO WHAT? * I personally think that Reeves has to come up with a plan quickly and get the measures out there otherwise everyone’s just going to keep guessing and a cloud of uncertainty will hang over businesses and individuals alike.

Business confidence remains weak after rise in national insurance (The Times, James Hurley) cites the latest BCC quarterly survey which shows that business confidence hasn’t yet recovered from the April tax and wage rises. Less than half of the respondents expect their sales to grow over the next 12 months. * SO WHAT? * The government’s U-turns are going to mean tax rises for all, so concerns about what those tax rises might be is going to be a cloud over everyone until we get more clarity on it.

Further to murmurings I mentioned yesterday, Investors fret over talk of AstraZeneca US move (Financial Times, Hannah Kuchler, Emma Dunkley, Ian Smith and George Parker) highlights concerns by investors that if AstraZeneca’s CEO’s threat to ditch London for New York comes to fruition, it would be bad not just for the entire UK market – it could be a major blow for the UK economy. It is seen as being a successful and innovative pharmaceutical company and if it leaves, it will make it much more likely for others to follow suit. Those who support the move will say that the company may get a better valuation and that it would be easier to increase pay for top execs. * SO WHAT? * I wonder whether this is just a move by AstraZeneca’s CEO to get better treatment from the government, with which it is currently negotiating on drug prices. Pharma companies have said that the UK needs to spend more on medicines or investment will suffer. I think that the government needs to take this seriously even if it’s just a negotiation tactic – because businesses are already feeling pretty uncertain at the moment and the LSE is really suffering what is turning out to be a serious exodus.

Contrary to what we’ve been seeing and hearing from pubs and alcoholic beverage companies with increasing frequency over the last year or two, Gen Z acquires taste for drinking as cost of living pressures ease (Financial Times, Madeleine Speed) cites a survey by IWSR, a market researcher for the global beverage industry, which found that 73% of Gen Z repondents out of the 26,000 people across the 15 biggest alcoholic drinks market surveyed had consumed alcohol in the last six months versus 66% two years ago. This represented the biggest increase of any generation as overall alcohol consumption is moderating over all generations. * SO WHAT? * One of the key conclusions to be drawn from this is that lower alcohol consumption among younger people is ACTUALLY being driven by the cost of living crisis and it does NOT represent a

fundamental evolution in societal habits! That being said, the drinks industry is still facing a global downturn in the amount of alcohol being consumed and everyone is wondering whether this phenomenon is structural (i.e. something fundamental that signifies a longer term shift) or cyclical (i.e. something that is a bit of a phase and will ultimately pass). The share price of companies including Diageo, Pernod Ricard and Heineken have all been hit by the assumption that this change in behaviour is structural. Such companies have tried to tempt drinkers into consuming higher quality drinks and/or by investing in low or no-alcoholic beverages. If this survey is a true reflection of society, then there’s hope yet for the industry. However, they do need to adapt to lower volumes they’re experiencing at the moment though – and that involves a lot of cost-cutting.

In employment trends, CEOs Start Saying the Quiet Part Out Loud: AI Will Wipe Out Jobs (Wall Street Journal, Chip Cutter and Haley Zimmerman) shows that CEOs are, with increasing frequency, saying that AI is unequivocally going to take jobs. Ford’s CEO Jim Farley said that “Artificial Intelligence is going to replace literally half of all white-collar workers in the US”, JP Morgan’s consumer and community business CEO said that she reckons operations headcount could fall by 10% in the coming years, Amazon’s CEO said that he expects the company’s overall corporate workforce to shrink and Anthropic’s CEO said in May that 50% of all entry-level jobs could vanish in the next five years – which could lead to the US unemployment rate hitting anywhere between 10% and 20%. Microsoft to cut 9,000 jobs as chatbots take over (Daily Telegraph, Matthew Field) says that 4% of Microsoft’s workforce is going to be cut, with the axe coming down on those in its Xbox division and King, its mobile games studio. CEO Satya Nadella recently said that up to 30% of the company’s code was now being written by AI bots. * SO WHAT? * This is obviously not a good thing to hear but unfortunately it is reality. While it may take some time before this REALLY kicks in across the board, I really think that it would be a good idea for people to give their futures proper consideration regarding how much of their jobs can be done by AI both now and in the future. If your job is likely to be eclipsed then making preparations early – to get more skills or to think about a completely different career path – would be a good idea rather than wait until the axe lands and THEN panic.

OpenAI signs $30bn data centre deal with Oracle (Financial Times, Cristina Criddle, Tabby Kinder and Rafe Uddin) heralds a massive deal that is one of the biggest cloud agreements ever signed for AI! This represents a major expansion of OpenAI’s “Stargate” data centre project, which it launched with SoftBank in January. Oracle is going to develop a number of data centres across the US to fulfil its Stargate obligations – the aim has been to invest up to $500bn in data centres in the US and around the world. Impressive!

Swedish AI start-up Lovable nears $2bn valuation (Financial Times, Tim Bradshaw and Ivan Levingston) highlights the success of the start-up that simplifies app programming at its latest fundraising round and provides another example of the increasing investor rush to “vibe-coding” companies. Loveable’s programming tool uses output of a number of different models including OpenAI, Anthropic and Google. It then adapts their code to create whatever app the user wants

to build. * SO WHAT? * It’s interesting to see the evolution of AI models into something more monetisable. I suspect that we’re going to see this trend continue…

Then in Bumble chief criticises staff for ‘freaking out’ over London job cuts (Financial Times, Kieran Smith and Costas Mourselas) we see the CEO being in less-than-supportive mood in the aftermath of her announcement of cutting around 30% of its global workforce. The axe is going to fall particularly heavily in London and Whitney Wolfe Herd said that “dating apps are feeling like a thing of the past”. She said that Bumble might collapse next year if drastic measures aren’t taken. 70% of Bumble’s staff are based in the UK. * SO WHAT? * Clearly this is very distressing for those affected in the UK but I guess that if deep cuts and strategy changes aren’t made then there may be no company left! 30% cuts are obviously better than 100% cuts!

In a quick scoot around some of today’s other interesting stories, Tesla sales go into reverse in fresh blow for Elon Musk (The Times, Louisa Clarence-Smith) cites the latest disappointing figures for Tesla as global vehicle deliveries dropped by 13.5% in Q2 and Tesla Is in Disarray. Musk Has Already Moved Beyond Caring About Cars. (Wall Street Journal, Becky Peterson and Sean McLain) suggests that Musk is beyond caring about cars as his attention appears to be shifting to self-driving taxis and humanoid robots. That being said, the reality is that almost 75% of Tesla’s $100bn in revenues over 2024 came from selling cars. It is sobering to think that the Cybertruck is the only new Tesla model in the last five years! * SO WHAT? * People have doubted Musk before and he has come through. If he really is shifting his focus then I would have thought that Tesla is going to be in limbo until we see real progress in the robotaxis and the robots.

In banks news, TSB gets its moment in the Spanish sun (Financial Times, Lex) remarks on TSB’s takeover, saying that the buyer Santander is really bolstering its credentials in the UK lending market by doing this and can probably squeeze some decent cost savings out of the deal as well, something which Santander takeover could lead to TSB branch closures across UK (The Times, Helen Cahill) considers as it suggests that 20% of the combined TSB and Santander branches could be shut down. It also says that the TSB name could disappear.

Then in An ‘Amazon of guns’? Welcome to the ‘parallel economy’ (Financial Times, Lex) we see that the incredibly aptly-named company GrabAGun is looking to do an IPO on the New York Stock Exchange in a few weeks’ time. It is described by some as the “Amazon of guns” as it is an online marketplace where you can buy – you’ve guess it – guns. You can even finance your purchase with something that they actually call “Shoot now, pay later”. Funnily enough, it’s going public by merging with a SPAC.

Back home, Greggs burnt by June heatwave as shares plunge (Daily Telegraph, Hannah Boland) shows that the baking giant has warned that the recent hot weather has killed sales of their pastries in its latest investor update. It said that this would impact its full year profits. The company’s share price has cratered by a whopping 40% in the last six months, so something clearly needs to be done here…

Who earns more? A rock star, a film star or the CEO of a multi-national? This will give you an idea of how much you could earn if you went down the CEO route 😱!

US Senate passes Donald Trump’s ‘big, beautiful’ tax and spending bill (Financial Times, Lauren Fedor, Myles McCormick and Stefania Palma) shows that Trump managed to get his landmark tax and spending legislation through the Senate with 51 votes to 50 after JD Vance had to cast the tiebreaking vote. The bill now goes to the House of Representatives where it could still come up against stiff opposition ahead of the July 4th deadline. Is Donald Trump’s ‘big, beautiful bill’ a political curse for Republicans? (Financial Times, Lauren Fedor and James Politi) suggests that it’s still going to be difficult to get it through – and then it seems that the American people themselves don’t seem to be convinced. Opinion polls reflect disquiet because they don’t like the fact that the bill will extent tax cuts for rich people whilst at the same time cutting healthcare and social programmed for poor people. A Morning Consult survey conducted over the weekend showed that 50% of voters were opposed while 36% supported it. The cuts to Medicaid could freeze 12m citizens out of access to health insurance over the next few years. Will this come back to bite the Republicans in the midterm elections??

Trump continued to be in feisty form as Donald Trump threatens to raise tariffs again on Japan (Financial Times, Aime Williams and Leo Lewis) highlights an escalation of trade rhetoric days before the 90-day “reciprocal” tariff suspension comes to an end (July 9th) and it looks like he may get the interest rate cut he’s looking for in Jerome Powell does not rule out cut in US interest rates this month (The Times, Mehreen Khan) as the Fed chief said that an interest rate cut in July was neither “on or off the table”. Powell maintained that any decisions will be made by the Fed “in a completely non-political way”.

Then in Trump and Musk’s feud blows up again with threats of Doge and deportation (Financial Times, Nick Robins-Early) we see that the bromance has taken another turn for the worse as Musk’s sustained criticism of the BBB stung the president into semi-threatening to deport Musk to South Africa whilst suggesting that he could cut government subsidies to Musk’s companies. Musk says that the BBB will “bankrupt America” and he has threatened to form his own “America Party”. * SO WHAT? * There seems to be so much BS flying around at the moment but, as I’ve said before, I think that both men ultimately need each other. The problem is that Musk is so vocal about his opposition to the bill that goes to the very core of Trump’s presidency that it is getting increasingly difficult for them to be able to find common ground.

Back home, Starmer guts UK welfare reforms to avoid Commons defeat (Financial Times, Anna Gross, George Parker, David Sheppard and Jim Pickard) shows that he managed to get his own controversial bill through Parliament – but only by watering it down significantly. The much-diluted bill eventually got parliamentary approval yesterday evening. It now looks like it could actually lose the government money! The original plan was to generate net savings of £5bn! It all centred around the initial intention to tighten eligibility criteria for the personal independence payment (Pip), which is the main disability payment – but this ended up being wildly unpopular. * SO WHAT? * This is a bad look for the government and will embolden MPs to push back on any other policies that Starmer might want to introduce. What a turnaround for someone who came into office surfing a massive wave of optimism. He’s going to need a succession of wins pretty darn quickly now in order to salvage any credibility…

UK visa revamp allows lower-skilled office workers to come to Britain (Financial Times, Delphine Strauss) highlights new rules laid out in Parliament yesterday regarding work-related migration. Work visas are, as a default, going to be restricted to graduate-level jobs although there will be exceptions for a range of lower-skilled office jobs on a “temporary shortage list” of occupations that still qualify for visas until the end of 2026. The Home Office said that 111 roles that had previously been eligible for visas would no longer qualify for them. * SO WHAT? * Clearly, the devil is in the detail here and employers are going to have to have a good look at what the new rules are to see whether they are going to have to change their recruitment strategies…

Meanwhile, AI talent wars lead to superstar salaries for top tech staff (Financial Times, Melissa Heikkila, Clara Murray and Cristina Criddle) shows that top AI researchers and engineers are in huge demand at the moment and employers are doing as much as they can to

hang on to their best talent. Sam Altman recently said that Meta had promised $100m sign-on bonuses to some of its most high-profile AI engineers! Some top AI engineers are getting over $10m a year whereas pay packages generally average out at anywhere between $3m and $7m – a 50% jump from 2022. * SO WHAT? * Interestingly, the talent pool seems to be pretty well-covered in the US and now companies are looking further afield to recruit in Europe. What a time to be alive if you’re an AI expert!

Then in Robots to overtake human staff in Amazon warehouses (Daily Telegraph, James Titcomb) we see that the number of robots in Amazon’s warehouses are set to exceed the number of humans for the first time. The number of robots used by Amazon has increased fivefold since 2020. I guess this all supports what CEO Andy Jassy said recently about the rising use of AI leading to fewer “corporate” jobs.

In US banks announce big shareholder payouts as Fed eases stress tests (Financial Times, Akila Quinio and Joshua Franklin) we see that Wall Street’s biggest banks announced a slew of dividends to shareholders and share buybacks yesterday after the Fed confirmed that 22 banks successfully passed yearly “stress tests” that judge their ability to withstand potential economic and market crises. These tests were the first ones since the Fed loosened the severity of its testing scenario. * SO WHAT? * Banks are obviously loving the sound of a more relaxed regulatory regime after years of restrictions. It sounds like there’s going to be a real freeing up of capital here, so in addition to all this share “buy-backery” and dishing out of dividends perhaps we’ll see some of that industry consolidation that everyone’s been talking about…

Meanwhile, Santander is buying TSB for £2.65bn (The Times, Robert Miller and Ben Martin) shows that Sabadell is offloading TSB after all the recent drama, for the sum of £2.65bn in cash. It won the bidding ahead of Barclays. Sabadell bought TSB from Lloyds Banking Group for £1.7bn back in 2015. The sale to Santander is expected to complete in Q1 of 2026. * SO WHAT? * I think that this is a pretty interesting move from Santander, which has been subject to speculation that it wanted to ditch its UK operations. Santander says that the acquisition of TSB reflects its

commitment to the UK, but I guess you could say that this may offer an even juicier proposition for a potential acquiror further down the line…

Following on from what I said yesterday about cash ISA allowances and pension pots, FCA tries to warm up the investment-wary masses (Financial Times, Lex) highlights reforms by the FCA for the financial advice industry. There is a need for this because just 9% of UK adults received financial advice last year, according to the FCA, and there are currently over 7m people with over £10,000 of investible assets that are entirely held in cash. The 2012 Retail Distribution Review was supposed to improve advice standards, but it resulted in customers not getting any sort of guidance because advisors subsequently priced many out of the market. The new guidance means that firms will be able to offer more detailed guidance with less red tape. Better AI could also help to provide more tailored advice at a cheaper cost * SO WHAT? * Banks, such as Lloyds, and wealth managers like St James’s Place and platforms such as AJ Bell will, in theory, be able to battle for market share of a bigger pie IF people take advantage of this new push to invest – but it’s going to take some convincing! 

In a quick scoot around some of today’s other interesting stories, Car Sales Cooled in June as Trump Bump Fades (Wall Street Journal, Sharon Terlep) cites the latest car sales numbers from the likes of GM, Ford and Toyota. They showed that the initial “Trump bump”, where consumers rushed to beat Trump’s 25% tariffs on imported cars and trucks, has died down. New vehicle sales fell in June to their slowest pace in a year. * SO WHAT? * Given a combination of people bringing forward car purchases to beat the tariffs and an uncertain economic outlook, it’s difficult to see any near-term positive catalysts here. Sales started to slow down in mid-May and this then leached into June.

Fixing up Nike is a marathon, not a sprint (Financial Times, Lex) considers last week’s investor euphoria of sorts where Nike’s share price went up despite a pretty rubbish set of results. So far, the “new” CEO has cut down on inventory, improved relationships with Nike’s wholesale retailers and prioritised product development for sports athletes. * SO WHAT? * Elliott Hill has done a good job of getting all the bad news out there and is making concrete progress on a number of fronts. Nike has come back from the dead before and investors seem to be giving Hill the benefit of the doubt when it comes to believing whether he can pull this off. It will take time, though.

WhatsApp plans to allow businesses to send voice notes to users (The Times, Louisa Clarence-Smith) highlights plans to allow businesses to send WhatsApp voice notes to users as part of its push to introduce adverts. Meta announced yesterday that it is introducing functionality that will enable all users to call large businesses on WhatsApp or ask them to call back. There will also be the ability to continue a conversation via messaging following the phonecall. Businesses will also be able to send voice notes to customers in “the near future” and do video calls. * SO WHAT? * This sounds great and all – particularly when you consider that WhatsApp has three billion users – but unless it starts to put ads on parts of WhatsApp that people use the most – I don’t think it’s going to make as big a splash as the company hopes. At the moment, you’ve got to  look on your “Updates” tab. It seems to me that the company will be pushing this as a “soft-launch” with a view to putting it all where everyone’s going to actually see it!

AstraZeneca boss ‘wants to shift stock market listing to US’ (The Guardian, Jasper Jolly) heralds another potential escapee of the LSE as its CEO has reportedly said that he’d be up for shifting the company’s listing from the UK to New York. * SO WHAT? * At the moment, the government is negotiating with the pharmaceuticals industry over rebates that pharma companies have to pay on sales of new medicines to the NHS so maybe the CEO is using this threat to get a bit more leniency. AstraZeneca can legitimately argue that the US is a very attractive market and it is somewhere that the CEO wants to target “as part of our 2030 ambition”…

Meanwhile, UK house prices fall as stamp duty hits demand (The Times, Jessica Newman) cites the latest Nationwide figures which show that house prices dropped more steeply last month than they did since February 2023 as the rise in stamp duty costs hit demand. * SO WHAT? * At the moment, there are concerns about the economy – and now the prospect of tax rises to come in the Autumn Budget – but decent wage growth and falling mortgage rates will no doubt make it tempting for many to buy property. Given that we’re right in peak selling season right now, I think that if this next month is weak as well, it could be a sign of big problems ahead.

M&S shops get £300m upgrade as part of cyber attack recovery (Daily Telegraph, Hannah Boland) shows that M&S is most definitely on the mend after its hacking problem as its CEO said that the whole of its online capability will be restored within the next four weeks. In addition to this, it announced plans to spend £300m on revamping almost 40 stores across the country to win shoppers back. The CEO said that the hope is that within 18 months, “half of our store estate will be new or renewed”. It’ll be interesting to see whether this has a detrimental effect on Waitrose…

Elsewhere, Smythson sold to private equity firm Oakley Capital (The Times, Isabella Fish) shows that the 138-year old leather goods maker and stationer has been bought by European private equity firm Oakley Capital from Tivoli Group, which has owned Smythson since 2009. Oakley already owns Alessi, Globe-Trotter and Connolly. Smythson has been suffering for some time so this will be welcome respite!

Then in Channel 4 to offer AI-generated ads on its streaming service (The Times, Emma Powell) we see that Channel 4 is going to offer AI-powered ads on its online streaming service using tech provided by Streamr.ai and Telana in an effort to get business from smaller and mid-sized companies who wouldn’t normally be able to afford TV advertising. It’s in the testing stage at the moment, but hopes to have a broader launch later this year. * SO WHAT? * I think that this is an interesting response to dwindling TV ad revenues. I guess this way you can generate a broader volume of business without damaging your margin too much.

This onion crisp recipe looks quite tasty so I think I’ll have to give it a go! Re the seasonings, I’m thinking paprika, chilli flakes (possibly cumin?? I know that might be a bit controversial but I think it might work) as well as salt and pepper, but I guess you could put anything on there! Maybe sour cream and sweet chilli dip to go with that??

Senate races to pass Donald Trump’s flagship tax bill as deadline looms (Financial Times, Lauren Fedor) shows that Trump’s “big, beautiful bill” got closer to getting over the line but it’s still not a done deal as there are Republican sceptics that need convincing and When will Congress pass Donald Trump’s ‘big, beautiful bill’? (Financial Times, Myles McCormick and Alex Rogers) sets out a number of hurdles that need to be overcome to get this thing done by the July 4th deadline. Such hurdles include concerns over the effect on America’s ballooning debt and cuts to Medicaid for people on low incomes. Also, once the bill passes the Senate, it’s still got to go back to the House – and it only got past the House by a single vote in May. Even if the bill misses the July 4th deadline, it’s no biggie. Meanwhile, Late tweaks to Trump tax bill create green power winners and losers (Financial Times, Martha Muir) shows that new revisions to the BBB will punish clean energy companies that use too many Chinese components but slightly positive for domestic residential solar providers.

Elsewhere, Canada scraps digital tax to restart US trade talks (The Times, Tom Saunders) shows that Canada has had to abandon the tax just hours before it was supposed to kick in following Trump’s dramatic termination of trade talks on Friday over its implementation. Carney needs Trump to return to the negotiating table to get a broader trade deal done.

Back home, Rachel Reeves set to cut cash Isa allowance (Financial Times, Emma Dunkley and Jim Pickard) shows that the chancellor is expected to cut the annual tax-free cash Isa allowance next month in an effort to encourage investment into British companies (the current limit is £20,000). This would be the biggest overhaul of the ISA regime since it started in 1999 under Gordon Brown. Meanwhile, Pension pots of savers at risk from new UK rule, industry experts warn (Financial Times, Mary McDougall) highlights the upcoming pension schemes bill, due to become law next year, which would give regulators the power to force defined contribution (DC) schemes to invest a minimum amount into private markets. * SO WHAT? * There’s a lot of debate going on at the moment about this broader move to push investments into domestic and growth assets. The fund managers are whinging about this being more restrictive and potentially damaging to returns (presumably because it will give them less of a free hand) while the government wants to encourage more investment in domestic assets. Both sides are right in that returns probably won’t be AS good as they might be due to the restrictions (but you never know, they might actually be better if the stockpickers do their job properly!) and, from the government’s side, it’s frustrating to watch these fund managers sitting on wads of cash that domestic companies don’t get a sniff of. As for the cash ISA thing, maybe I’m being unfair but I wonder whether a reduction in the cash ISA limit will just mean that people just splurge it on bitcoin or other riskier investments in the hope of more exciting returns. Still, for many, this will all be somewhat academic as household incomes continue to get squeezed and the amount of money left over for savings keeps shrinking!

In UK caps steel imports to stop dumping by foreign producers (The Times, Robert Lea) we see that business and trade secretary Jonathan Reynolds has decided to restrict steel imports following pressure from British steelmakers, starting from today. * SO WHAT? * The idea of this is

to protect us from dumping of product here as steelmakers around the world (but particularly from China) try to divert what would have gone to America. The decision was welcomed by UK steel, the industry trade body.

In currency news, US dollar has worst first half in more than 50 years amid Trump tariffs (The Guardian, Graeme Wearden) highlights dollar weakness so far this year as it’s fallen at its steepest rate against a basket of currencies since 1973. It has now fallen by 10.8% in the first six months and has been sold off by investors concerned about the effect of Trump’s economic policies. Over the same time period, the Euro has gained about 5%!

In commodities news, Silver, the precious metal ready to outshine gold (Financial Times, Lex) brings our attention to a shiny metal that isn’t gold because it’s also enjoying an impressive run as more investors see it as a safe haven asset in a world of Trump-driven uncertainty and wars. They don’t usually rise in line with each other but its increasing use in a growing number of industrial applications means that demand continues to rise. This means that it is a double-play on being a safe haven asset and a reflection of growth sectors.

Then in markets, Hong Kong’s bull market leaves China behind (Financial Times, William Sandlund and Haohsiang Ko) follows on from what I said yesterday about Hong Kong’s IPO boom and points out that Hong Kong’s market is outperforming mainland China’s by its biggest margin since 2008! This has been thanks to rising investment flows from the mainland and thirst for tech companies such as Alibaba and Tencent which aren’t listed on the mainland. Also, mainland markets have been held back because of their greater exposure to poor performances in heavy industry, property and energy. I would have thought that this outperformance in Hong Kong will make flotations even more attractive going forward…

Google agrees deal to buy power from planned nuclear fusion plant (Financial Times, Tom Wilson) is an interesting article that highlights Google’s commitment to buy 200 megawatts of electricity from Commonwealth Fusion Systems’ planned power station in Virginia in the 2030s. CFS hopes that the 400MW facility will be the first fusion power station to be connected to the grid. * SO WHAT? * CFS is thought to be one of the most advanced privately-held nuclear fusion companies racing to develop a commercially viable electricity supply. At the moment, it’s building a demo plant in Massachusetts which is scheduled to be turned on in 2027. It is hoping that the plant that would supply Google will be ready by the early 2030s. This is another step forward in the advance to a nuclear fusion-powered future…

As if to emphasise the urgent need for the rapid advancement of power generation even further, Smelters say they are losing power battle with Big Tech (Financial Times, Camilla Hodgson and Jamie Smyth) shows that US and European policymakers’ efforts to reshore metals processing are being stymied by rising demand from Big Tech who are willing to pay much more for their electricity so they can power their data centres. One industry described the current situation as “not Alcoa versus China, but Alcoa versus Google”. Something is clearly going to have to give here if America is serious about boosting its heavy industry capability…

In Home Depot agrees $5.5bn deal for building product supply group GMS (Financial Times, Gregory Meyer and Oliver Barnes) we see that the US hardware retailer is going to buy building products distributor GMS, beating a rival consortium of investors. It will become part of Home Depot’s SRS Distribution subsidiary which it bought last year for a whopping $18.25bn last year. Is this a sign of more M&A to come??

Back home, WH Smith cuts sale price of high street stores (The Times, Isabella Fish) shows that the retailer has agreed to accept £12m less than it was promised by PE buyer Modella Capital for its high street business. It will now receive up to £40m gross rather than the expected £52m. Modella pushed for better terms after a period of “softer trading”. * SO WHAT? * I know that this is going to sound a bit harsh but this shows a) how desperate WH Smith are to offload their high street business and b) that you probably shouldn’t trust Modella Capital if they make you an offer! The high street business is dire IMO and is in need of a top-to-bottom overhaul. As for Modella, I guess that if things have got so bad that you have to sell to them, there’s not really much you can do because they have the money.

Consumers continue to face tricky times in UK disposable income falls at fastest rate since 2023 (Financial Times, Valentina Romei) as the latest figures from the ONS show that UK household disposable income fell at its steepest rate since 2023 in Q1, coming at a time when economic growth is expected to slow down. Dry weather pushes up UK food inflation as harvests suffer (Financial Times, Valentina Romei) cites the latest numbers from the BRC which show that the annual rate of food inflation was 3.7% in June. Dry weather hitting fruit and veg harvests have driven prices upwards. The Met Office even said that this spring was the warmest and sunniest spring in the UK ever recorded! * SO WHAT? * This has been great for strawberries and tomatoes but not so much for things like wheat and barley. Tough times indeed! This does not bode well for the next few months leading into the autumn Budget where many expect taxes to rise…

Then in Mortgage approvals rise for the first time in four months (The Times, Mehreen Khan) we see that figures for May recovered following recent stamp duty changes and interest rate cuts. * SO WHAT? * The question is whether buyers will dwindle given ongoing pressures on household finances and the prospect of higher taxes being implemented in the autumn Budget a few months hence.

Oracle shares hit record high on $30bn cloud contract (Financial Times, Rafe Uddin) highlights the database giant’s chunky share price uplift of 4% on news that it won a $30bn cloud computing contract that is, on its own, worth three times the annual revenue it gets from its fastest-growing data centre division! The revenue will start rolling in in 2028 but the company didn’t disclose who the customer was. * SO WHAT? * Oracle has been a bit of a latecomer to the cloud computer party but demand for data centre infrastructure has shot up, helping it to benefit from capacity constraints at rivals including Microsoft.

AI doctor four times better at identifying illnesses than humans (Daily Telegraph, James Titcomb) brings attention to Microsoft’s AI diagnosis system that it says correctly identifies ailments up to 86% of the time versus just 20% on average (😱!) for British and American physicians! Microsoft touted this as being the basis of “medical superintelligence”. * SO WHAT? * Wow! If this is right, this is pretty amazing. This would suggest that things are only going to get

better in future! I wonder whether AI will eventually take over diagnosis and doctors as we know them now would evolve into the humans who then treat the conditions identified…

Children face lifetime social media bans for sharing classmates’ nudes (Daily Telegraph, James Titcomb) is an eye-catching title isn’t it! This highlights proposals from Ofcom that could punish kids who share nude images of their classmates with a lifetime social media ban. It would mean that cyberbullies could be permanently excluded from social networks. Platforms would have to make sure that users couldn’t just sign up under a new name and carry on. * SO WHAT? * It’s good that we’re looking to crack down on cyber bullying but I just wonder how enforceable this is all going to be. A lot of whether something like this works will depend hugely on the actions of the platforms. There is a danger that it may well drive this behaviour underground and result in a mushrooming of alternative platforms that aren’t so willing to protect their users.

In a quick scoot around some of today’s other interesting stories, US air taxi start-up Joby in successful flight testing in Dubai (Financial Times, Sylvia Pfeifer) shows that Joby Aviation is edging ever-closer to launching its first commercial service – potentially at the end of this year after completing test flights in Dubai! Its air taxis is designed to transport a pilot and up to four passengers at speeds of up to 200mph. * SO WHAT? * This sounds like fun – and very much a Dubai thing – but I remain sceptical as to their wide-spread adoption in cities like London and New York. I am willing to be wrong though!

Back home, Nissan to axe hundreds of UK jobs (Daily Telegraph, Louis Goss) shows that Nissan is planning to cut about 4% of the workforce at its Sunderland plant as it battles to boost profits while demand for EVs continues to slide. This facility is the biggest car factory in Britain and Nissan’s only factory in Europe. It is also Sunderland’s biggest employer. Nasty. On the plus side, a Nissan spokesman said that “Our Sunderland plant remains at the forefront of our electrification strategy”.

Given the heatwave many of us are experiencing at the moment, I thought that this method of cooling the interior of your car down quickly would be useful for all of us! It’s all down to fluid dynamics – so it’s got to work!

Russia hits Ukraine with biggest air attack of the war (Financial Times, Christopher Miller) highlights a major attack on Ukraine as Russia turns the screws and Ukrainians cry out for more help with defence. Ukraine has had to use fighter jets increasingly because of its falling supply of surface-to-air defence systems and interceptor missiles. It looks like there’s going to be no let-up…

Donald Trump’s fiscal policy and Fed attacks imperil US haven status, say economists (Financial Times, Claire Jones and Eva Xiao) cites the results of a poll carried out by the FT which found that over 90% of respondents were either somewhat concerned or very concerned about the status of US dollar-denominated assets keeping their “haven” status in the next five to ten years. At the moment, it looks like the Swiss Franc and gold are emerging as the safe haven assets of choice while Trump’s erratic policies and attacks on the Fed are increasing the risk premium. Meanwhile, G7 strikes deal with Trump to escape ‘revenge’ taxes (The Times, Jill Treanor) signals a positive move forward in trade negotiations as the G7 will exempt American companies from parts of a major global tax agreement in exchange for Trump’s administration no longer implementing a “revenge” tax detailed in Section 899 of his “One Big Beautiful Bill” although Republicans struggle to pass Trump’s ‘big, beautiful bill’ as debate drags on (Financial Times, Stefania Palma and Myles McCormick) shows that the bill only just garnered enough support to even get debated in the Senate. Getting this bill done has been a big priority for Trump and he wants senators to pass it before the July 4th holiday. Meanwhile, Trump accuses Fed chairman of keeping interest rates ‘artificially high’ (Daily Telegraph, Tim Wallace and James Titcomb) highlights further pressure on the Fed, which is supposed to be independent, as the president is laying the blame firmly at the door of Jerome Powell for keeping interest rates too high, lumbering the administration with high borrowing costs. The president said in a Fox News interview that he was looking forward to “getting somebody into the Fed who is going to be able to lower the rates”. Powell’s term is set to end in 11 months but it looks like Trump is looking to undermine him by naming his successor early. In the same interview, Trump says he has found group of ‘wealthy people’ to buy TikTok (Financial Times, Cristina Criddle) shows that he may or may not have come up with a solution to the TikTok problem, adding that “I think I’ll need probably China approval and I think President Xi will probably do it”. So far he’s kept delaying the deadline for parent company ByteDance to divest its American operations (the latest one is

September 17th) but I find it interesting that he’s not been very specific about who these buyers were. Whatever he says, any deal will have to be approved by ByteDance and the Chinese government.

Elsewhere, China manufacturing activity shrinks as trade war bites (Financial Times, Thomas Hale) cites the latest data from National Bureau of Statistics which shows that Chinese manufacturing activity contracted for the third consecutive months in June as the impact of the trade war with the US continues to bite. A truce between Washington and Beijing was signed last week, but you just don’t know what’s going to happen when Trump’s involved!

Back home, Ministers face showdown on UK welfare reform as concessions fail to quash rebellion (Financial Times, David Sheppard) highlights nervy times for the government as it still faces a vote on its divisive welfare reforms tomorrow. Despite Starmer’s climb down last week, it’s not a foregone conclusion yet as to the outcome! * SO WHAT? * The government has a working House of Commons majority of 165, which means that about 80 Labour MPs will need to vote against the welfare bill to defeat it. Starmer softened his original welfare reforms last week after over 120 Labour MPs threatened to rebel. The problem now is that, along with the previous U-turn on winter fuel payments, chancellor Reeves will have to find an extra £4.25bn from somewhere. A lot of people are predicting tax increases in the autumn Budget.

In markets news, Hong Kong IPO boom challenges the city’s critics (Financial Times, Lex) shows that the Hong Kong Stock Exchange is staging a major comeback after the investor exodus of two years ago as Dealogic numbers show that listings on the exchange have raised $13bn so far this year! * SO WHAT? * This means that it is behind only the NASDAQ – and puts it ahead of the New York Stock Exchange! Expectations are that by year end it will have raised a healthy $25.5bn. Another positive is that newly listed shares have made an average return of 35%, which is great for pipeline feelgood. Most of this has been thanks to Chinese companies getting a secondary listing in Hong Kong. Given the current hostile environment in the US for Chinese companies, it’s no wonder that they are ditching New York listings in favour of a politically safer Hong Kong – and there is plenty of demand! Retail investors have been a major force, but it seems that institutional investors are also finding their way back…

In Nvidia insiders cash out $1bn worth of shares (Financial Times, Michael Acton and Patrick Temple-West) we see that a number of Nvidia’s top brass have been cashing in on the company’s wave of popularity to the tune of over $1bn over the past 12 months, including CEO Jensen Huang himself. Over $500m of that was this month as the company’s share price hit a record high. * SO WHAT? * It is important to note that Huang’s share sales were part of a trading plan agreed back in March which set the levels at which share sales would be executed. This is worth saying because markets don’t like CEOs (or senior execs) selling shares because it implies that they know something bad is about to happen! This way, investors are less likely/unlikely to panic.

US energy groups spend record sums on power plants to feed data centres (Financial Times, Martha Muir) cites research from Jefferies which shows that US energy companies are putting a projected $212.1bn into building power plants and transmissions lines, rising to a record $228.1bn in 2027 in order to service the demand from data centres. * SO WHAT? * Given the massive sums involved, there’s an increasing likelihood that consumer and small business utility bills are going to rise in order to pay for this. One way of reducing this is to get “hyperscale” developers such as Amazon, Microsoft and Meta to fund utilities’ investments directly or via special tariffs. Although this article talks about what’s happening in America, you do wonder whether this is a sign of things to come over here as well! I keep saying it, but I don’t really see it mentioned anywhere else, but electricity demand isn’t just going to go up because of data centre demand – it’ll rise because people are still yet to adopt EVs en masse! We will need to make sure our infrastructure can cope!

Getty Images accuses ­Stability AI of dragging brand into gutter (The Times, Katie Prescott) highlights a legal fight between Getty Images and Stability AI where the former has accused the latter of bringing its brand into disrepute by allowing its watermark to appear on pornographic images. Stability had been aware of its AI producing watermarked explicit images and just carried on regardless. Getty Images argued that having the watermarks on the pictures exploited

its reputation and accused Stability of using millions of images and videos from its website without permission or payment to train its Stable Diffusion software. * SO WHAT? * If Getty is successful, this could have big implications for tech companies because it would mean that even if a model was trained abroad, if it breached copyright and was available here, it would be unlawful. Stability is arguing that its models are “crucial for scientific progress and creative freedom).

Entry-level jobs plunge by a third since launch of ChatGPT (The Times, Tom Saunders) cites the latest research from Adzuna which found that the number of entry-level roles has fallen by 31.0% since the launch of ChatGPT in November 2022. These entry level positions account for just 25% of the overall jobs market versus 28.9% in 2022. It also found that companies have become more vocal about using AI to cut their workforces. The CEO of Anthropic said last month that AI could cut about 50% of entry-level white-collar jobs within five years and push up unemployment by 10-20%. * SO WHAT? * The biggest fall in entry-level jobs was in the retail sector followed by logistics, warehousing and administration sectors. At the moment, I’m not so sure about the disaster scenario. Sure, employers have been hit badly by higher costs, but over the longer run, once they have got used to this, I would have thought that demand for humans will evolve rather than disappear. The CEO of Anthropic would paint a dark picture because he’s just talking his own book. At the end of the day, I would like to think that humans will ultimately want to support humanity and a balance will be found between the use of AI and the role of humans. Surely at some point, wages for HUMANS will go higher because the more procedural, repetitive jobs will be carried out by AI-powered robots and the more interesting ones requiring emotional intelligence, empathy and human understanding will emerge. BTW, I am aware that not everyone is against mundane, repetitive jobs because some people just see a job as a way of making some money to pay the bills. There’s nothing wrong with that – but the challenge here will be how to make sure that these people are more fully engaged in the employment market.

Crypto-crazy investors make South Korea the best-performing market in Asia (Financial Times, Song Jung-a) is an interesting story that highlights what’s going on in the South Korean stock market at the moment after newly-elected President Lee Jae-myung said that he would allow crypto-backed assets to be backed by the Won. Companies that would directly benefit, like Kakao Pay and LG CNS have seen their share prices more than double and rise almost 70% respectively this month before investors sold to lock in at least some profit! Other smaller crypto-related companies have also benefited enormously from the frenzy! * SO WHAT? * Retail investors in particular have been leveraging in order to jump on the stablecoin bandwagon before the government has announced any kind of detail about its crypto policies. At the moment, around 20% of South Korea’s population trades digital assets – and you would have thought this is going to rise amidst all the hype – while banks, brokerages and fintechs are itching to get a piece of the action. They need regulation. Is this a sign of things to come elsewhere?

Then in London-listed companies pile into bitcoin (Financial Times, Nikou Asgari) we see that London-listed companies are now increasingly investing in bitcoin as a way to bolster their share prices! They are all trying to copy billionaire Michael Saylor’s company Strategy whose valuation has boomed by almost 400% since August 2020 when it announced that it would plough billions of dollars into bitcoin. One example of this is the Guildford-based Smarter Web Company, a website design business, that has seen its valuation skyrocket from £4m to over £1bn in just two months after it announced its bitcoin buying plan in April ! Although its share price has weakened, its stellar performance has inspired others to emulate it. * SO WHAT? * Given that the government has said that it wants to make the UK a hub for digital assets, the fact that Trump is plunging headlong into them and that regulators are all getting more crypto-curious, it seems that the momentum is with crypto. It still feels like there’s a lot riding on something that

has no physical form but I guess the more people believe in it the more likely it is that success will be a self-fulfilling prophecy. It just all feels somewhat precarious, though, because everyone is piling in. That being said, a more benign regulatory environment will calm the nerves of many and give “grown up” institutions licence to move forward and offer it to the masses.

Then in UK launches biggest financial advice shake-up in more than a decade (Financial Times, Emma Dunkley and Martin Arnold) we see that the FCA will today unveil one of the biggest shake-ups in investment advice for over ten years by enabling British savers to get access to “targeted support” under new rules. Many people have been left behind in an “advice gap” where financial advice has been increasingly out of reach for “ordinary” people who can’t afford it but need more guidance than the current rules allow. The FCA reckons that around 7 million British adults have over £10,000 in cash savings and no investments and that 13.5m to 30.6m could benefit from targeted support. It said that it will consult with industry regarding rules covering targeted support by December on providing generic suggestions to groups of similar savers. Specifically, this means that there will no longer be arduous requirements to carry out detailed suitability assessments and firms will be able to make financial product suggestions based on customers providing “essential relevant facts”. * SO WHAT? * This sounds very interesting but I think that although the strategy sounds right, it depends on how this is executed. If it results in more people being stuffed with unsuitable financial products by advisers keen to make commission on the products that they sell, then this isn’t good. Also, I seem to remember a lot of excitement surrounding the provision of “robo-advice” to people with uncomplicated financial situations – but that died a death pretty quickly. I’ll get back to you with more on this because my wife works in this world!

In a quick scoot around some of today’s other interesting stories, Middle East tensions could trigger food price shock, warns fertiliser boss (Financial Times, Susannah Savage) shows that the head of one of the world’s biggest fertiliser companies, Yara, said that ongoing tensions in the Middle East could push food prices up because global supply chains could come under increasing pressure as everyone tries to source crop nutrients and energy. About a third of urea exports, 44% of sulphur exports and almost 20% of ammonia exports travel through or are produced in countries on the west of the Strait of Hormuz, an area that is highly charged at the moment.

Closer to home, Asda plots to overtake Primark in revival push (Daily Telegraph, Luke Barr) shows that the embattled supermarket is looking to take on Primark to become the UK’s biggest clothing retailer! Chairman Allan Leighton is going to push George, Asda’s clothing brand, at 100 new stores that will be refurbished to showcase the offering. “Primarmi” is currently sitting in the top spot of the biggest seller of clothes by volume, followed by Next and then George. * SO WHAT? * Now I admit that I’ve been slagging Leighton off recently, saying that just cutting prices

shows a lack of imagination and ⚽⚽. HOWEVER, I take that all back now because I think that this is a GENIUS idea. I’ve seen George transform Asda’s fortunes before and I think that the timing is now perfect to do it all over again. If it works, it could increase footfall, and if footfall goes up that’s going to be good for sales. I still think he needs to do something more to address the core retail offering, but I really think that this is going to help – as long as the product is good enough.

Then in Lotus reverses plan to shut factory after UK offers fresh support (Financial Times, Kana Inagaki and Jim Pickard) we see that Lotus will not now end car production in the UK following offers of government support. Lotus had said on Saturday that it was “actively exploring strategic options” to streamline its operations and improve global competitiveness after rumours emerged that it was thinking of shutting down its Norfolk factory. UK business secretary Jonathan Reynolds met Lotus management yesterday and it now seems that Geely-owned Lotus isn’t going anywhere.

I thought that this was quite a fun video about a place in Tokyo where you can go and customise jeans! I’ve got no affiliation with this place but just thought it looked good 👍

In Early intelligence suggests Iran’s uranium largely intact, European officials say (Financial Times, Henry Foy and Andrew England) we see that preliminary reports given to European governments suggest that Iran’s enriched uranium stockpile has been largely untouched despite the recent US attacks. The assessments indicated that the 408kg has been spread around various other locations. Despite Trump describing the recent bombing raid as having “obliterated” Iran’s nuclear programme, one report said that there had been “extensive damages, but not full structural destruction”. * SO WHAT? * It seems to me that no-one really knows the real extent of the damage at the moment but TBH I think that the main thing here is the damage done to the leadership of Iran and whether it will herald a regime change or a resurgence of nationalist fervour. 

Meanwhile, US Treasury asks Congress to scrap foreign revenge tax in Trump bill (Financial Times, Claire Jones, Stephen Foley and Emma Agyemang) shows that the US Treasury wants Congress to take out Section 899 of Trump’s “big, beautiful bill” that would enable Washington to increase taxes on foreign companies and investors that it deemed to have disadvantageous tax policies for American companies. * SO WHAT? * Wall Street has been very much against this and it seems that the government has now backpedalled as a result because Treasury Secretary Scott Bessent said yesterday that the measure wasn’t needed any more because he’d already negotiated improved terms for US companies under the new OECD global minimum tax regime. Although a deal of sorts has been struck with other G7 countries, it will still need to be formally approved by the OECD next week.

How $29 sandwiches pushed New York to socialism (Daily Telegraph, Hans van Leeuwen) is an interesting article which goes some way to explaining how an outsider won the Democratic candidacy for New York mayor this week. It’s probably a combination of a few things – New Yorkers are just getting sick of prohibitive rents and paying $20+ for a sandwich 😱 just to mention a couple of examples! Inflation in New York is around 4%, which is double the nationwide average of 2% and pay isn’t keeping up with these prices as inflation adjusted wages in the city dropped by 3.7% in 2023 versus 0.9% across the whole country. Young people are feeling particularly disaffected. The drama continues…

Then in Dollar slumps as Trump hints at new Fed chief (The Times, Emma Powell) we see that Trump’s at it again – threatening to remove current Fed chair Jerome Powell by October because he’s not cutting interest rates. * SO WHAT? * The market didn’t like this at all and sent the dollar to a multi-year low versus a number of other currencies, including the pound which hit its highest level versus the dollar since the beginning of 2022. Maybe he’s rattling cages to take attention away from the whole Iran war thing and whether or not it was as much of a success as he said it was…

Back home, How Starmer averted ‘civil war’ with Labour MPs after diluting welfare cuts (Financial Times, Jim Pickard, David Sheppard and Sam Fleming) shows how Starmer has now backtracked on his welfare reforms following a groundswell of resistance from Labour MPs to the proposed cuts (over 100 of them said they were going to vote against his welfare bill). * SO WHAT? * This is going to cost £1.5bn which will no doubt have to be found from somewhere else (probably taxes) – but it’s also going to highlight potential troubles for the PM. Given how close he would have come to a House of Commons defeat here, you do wonder how it’s come to this given that his government won such a big majority when he came to power. The risk here is that MPs smell blood and that they could start rebelling against other policies as well…

Growing signs of slowdown in UK jobs market, says Bank of England governor (The Guardian, Phillip Inman and Graeme Wearden) cites the governor of the Bank of England saying that it looks increasingly like the UK jobs market is slowing down thanks to the effects of April’s introduction of higher NICs for employers. Mind you, Office for National Statistics has ‘deep-seated’ problems and needs an overhaul (The Guardian, Phillip Inman) cites the recently published Devereux Review which really laid into the ONS and recommended a £10m overhaul and its top role split in two. * SO WHAT? * Too right! The ONS has been pretty useless for a while now and it still produces duff employment statistics – so the sooner it can be sorted out the better! At the end of the day, the Bank of England in particular needs reliable stats to help it with interest rate decisions and so the ONS really needs to step up its game.

In energy news, Centrica set to take 15% stake in Sizewell C nuclear project (Financial Times, Ashley Armstrong, Jim Pickard and Ian Johnston) highlights Centrica’s decision to bring its interest in Sizewell C up to that of French state-owned energy group EDF, which has been bringing its stake down. * SO WHAT? * Sizewell C was initially proposed by EDF and China General Nuclear Power Group (CGN) but the latter was bought out by UK taxpayers in 2022 over security concerns. This is all part of a broader strategy to provide sustainable power.

Talking of which, Ed Miliband pulls plug on Sahara sun and wind project (The Times, Emily Gosden) shows that the government has decided to ditch plans to bring solar wind and power from Morocco via what would be the world’s longest subsea electricity cable due to worries about security and costs. The company that was going to do this, Xlinks, had been trying to win a contract with the government that would have provided British customers with electricity at a fixed, subsidised price for 25 years! The Department of Energy Security and Net Zero wants to shift focus and “build homegrown power here in the UK”. That’s got to hurt for Xlinks.

In Xiaomi shares soar to record after phonemaker sells 200,000 electric SUVs in 3 minutes (Financial Times, Edward White and William Sandlund) we see that the Chinese mobile phone maker’s first attempt at an EV is on track to be a roaring success as it sold 200,000 vehicles in just three minutes when it announced the launch of its YU7 SUV yesterday! It is priced at $35,370 to compete directly with Tesla’s Model Y. * SO WHAT? * This will definitely throw the cat among the pigeons for the likes of BYD and others in a very competitive market. When your first launch has more than a passing resemblance to the Ferrari Purosangue that costs the best part of £500,000, you know you’re on to a winner! I think that Tesla, as an EV company, is toast.

Which brings me on to Elon Musk’s right-hand man ‘quits Tesla’ (Daily Telegraph, Daniel Woolfson) where a man known as Musk’s “fixer”, Omead Afshar, has “stepped down from his

role at the company”. He was thought to be very close to the founder and had been engaged in a number of important projects. He may well have been a casualty of Tesla’s current slump in form…

British vehicle production falls to lowest for May since 1949 (The Times, Tom Saunders) highlights dire times in British vehicle manufacturing as the latest numbers from the SMMT showed not only the fifth consecutive month of production decline, but also the lowest production since 1949 (excluding 2020)! This was in the most part thanks to the shock reaction to Trump’s import tariffs. Shipments to the US fell by a whopping 55%. * SO WHAT? * This is a shocker but we’ve since signed a deal with the US that reduces the initial levy substantially, so you would have thought that the prospects for recovery are reasonable, given a willing US consumer.

In consumer goods news, Nike shares surge 10% on turnaround hopes despite worst results in years (Financial Times, Zehra Munir) highlights just how much investors believe in Nike’s turnaround plan despite the company posting its worst quarterly earnings in over three years! CEO Elliott Hill, who took up the top job last year after being brought back out of retirement, did a great job of hyping the company on yesterday’s analyst call. He talked about initiatives including the development of product lines for “crucial sports” and that, having been through the worst, he expected “the headwinds to moderate from here”. * SO WHAT? * The company’s previous woes had widely been blamed on things like its emphasis on direct-to-consumer sales, lifestyle products and fashion trends. The new emphasis will be on sports. Let’s see whether this works!

In Unilever pays $1.5bn for men’s grooming brand Dr Squatch (Financial Times, Ivan Levingston, Oliver Barnes and Madeleine Speed) we see that the consumer giant has bought a niche brand in a bid to make a splash in male grooming, an area where it has been lacking. Dr Squatch was sold to them by private equity firm Summit Partners. * SO WHAT? * This sounds like a positive development but everyone will be hoping that Dr Squatch will not go the same way as Dollar Shave Club, which Unilever bought in 2016 for $1bn only to sell it in 2023 as it did not

integrate well. I think that this sounds like a decent enough idea in principal but it’ll be interesting to see how consumers take it because Dr Squatch has a certain amount of “little guy” charm about it that might disappear into the massive corporate behemoth that Unilever is.

In retail news, Boots posts another quarterly sales boost ahead of takeover (The Times, Isabella Fish) shows that the high street retailer put in a solid performance for the quarter, benefiting from the popularity of trending Korean beauty products. It also managed a 17th consecutive quarter of market share growth. Digital sales continue to be a key growth driver. * SO WHAT? * Private equity firm Sycamore Partners agreed to buy Boots’ parent company, Walgreens, for $10bn back in March. Rumours are that Boots could be spun off, so putting in solid performances could be very useful to attract a decent price further down the road!

Clothing prices rising in US as Trump tariffs kick in, H&M boss says (The Guardian, Sarah Butler) takes a look at H&M’s sluggish half-year results performance in light of a difficult US market. The CEO said that US customers had become very price-sensitive and that competitors are already cutting prices. It is going to have to discount more than it did last year in the coming months in order to convince customers to part with their cash!

In a quick scoot around some of today’s other interesting stories, Reddit vows to stay human to emerge a winner from artificial intelligence (Financial Times, Daniel Thomas and Hannah Murphy) highlights an interesting aim for the social network – that it wants to protect its online communities from the AI hype and keep its content human. The company has “20 years of conversation about everything” and has, somewhat ironically then, made money out of it from massive partnerships with Google and OpenAI to train their LLMs on its real-world content. * SO WHAT? * Reddit’s increasing importance is now prompting companies to host their own business account to increase the likelihood of their ads appearing in the responses of AI chatbots. Reddit,

however, is keen to ensure that only humans can post on its forums and that only humans can vote on it – but that will increasingly necessitate reliable human verification.

Then in Visma eyes London listing in boost for the City (The Times, James Hurley) we see that PE-backed business software group Visma has provisionally chosen London over Amsterdam for a listing, partly due to listing reforms by the FSA and partly because of its deeper pools of capital and the UK-centric investor base. The final decision hasn’t been made yet but if the LSE bags this one it will be chalked up as a decent win!

Now I do like a bit of camping. However, I would draw the line at this tent! What do you think??

Nato promises historic rearmament shift in bid to win over Donald Trump (Financial Times, Henry Foy, Steff Chavez and Anne-Sylvaine Chassany) shows that NATO is promising that its members will raise defence spending to 5% of GDP by 2035 in an effort to appease Trump and get him to continue to maintain existing commitments in Europe. In a NATO summit at The Hague, Trump told the 31 allies that he was “with them all the way”. Donald Trump changes tune on Volodymyr Zelenskyy and Putin (Financial Times, Christopher Miller and Steff Chavez) shows that the president has once again changed his assessment of the Ukrainian leader, describing him as “very nice”, whilst also mildly admonishing Putin, who “really has to end that war”.

Back in the US, Donald Trump brands Zohran Mamdani a ‘100% Communist Lunatic’ (Financial Times, Guy Chazan) reflects the president’s assessment of the mayoral candidate who was a surprise winner in the Democratic primary. Among other things, Mamdani promised to freeze rents and increase taxes on the wealthy to fund free buses, reduced food prices and universal child care. Wall Street reels from Zohran Mamdani’s victory in New York mayoral primary (Financial Times, James Fontanella-Khan, Amelia Pollard and Sujeet Indap) shows that Wall Street was none too pleased about Mamdani’s victory either and various big cheeses in the finance world immediately looked at the best way of finding a centrist challenger before the mayoral election in November.

Meanwhile, UK to focus new trade strategy on boosting services exports (Financial Times, George Parker, Peter Foster and Ashley Armstrong) brings our attention to today’s announcement from Starmer where he’ll outline a new trade strategy that will focus on the export of UK services. He’ll also talk about how we’ll defend against an influx of product that was destined for America but now needs to find new buyers! Chinese exports to UK rise as firms seek to avoid US tariffs (The Guardian, Heather Stewart) confirms the need for such protection as it cites data from the Chinese government which showed that exports to the UK in May increased by 16.1% versus May last year! * SO WHAT? * Given that pretty much three-quarters of our GDP comes from the service sector, it’s about time that there was a proper and coherent strategy to make the best of what we do best! It’ll be interesting to see the detail. I would have thought, though, that the main danger for imports will be more in manufacturing…

Then in Keir Starmer bats away welfare rebellion threat as ‘noises off’ (Financial Times, Anna Gross, David Sheppard and Jim Pickard) we see that the PM has rejected claims that rebellion from his own party on welfare reforms could precipitate the end of his tenure at number 10. He remains confident that his divisive package will pass the Commons vote next week but this is the biggest rebellion of Labour MPs so far.

Meta wins artificial intelligence copyright case in blow to authors (Financial Times, Cristina Criddle) highlights a big win for Meta and a bitter blow for authors over the use of millions of books to train its AI models. A federal court judge has decided that the absorption of all the books, academic articles and comics by Meta’s AI models constituted “fair use” because they had been used to develop a transformative technology. However, it is worth noting that the judge said that the decision was a reflection of the authors not properly making their case rather than the lawfulness of Meta using copyrighted materials. * SO WHAT? * This is the second case this week that has found in favour of the AI models (Anthropic won another similar case on Monday), but it doesn’t sound like this will be the end of it. When the judges are giving you advice about how to sharpen your arguments, you know there’s hope!

Meanwhile, Meta boss praises new US army division enlisting tech execs as lieutenant colonels (The Guardian, Robert Booth) shows that Meta’s CTO has now become a lieutenant colonel in Detachment 201, a unit in the reserves which that US army says will “fuse cutting-edge tech expertise with military innovation”. The unit has taken on some major top bods at Palantir, OpenAI and Thinking Machines Lab. * SO WHAT? * Such recruitment shows how important AI is becoming to the military but Big Tech’s push into military AI is troubling (Financial Times, Jonathan Guyer) highlights misgivings about this growing relationship because AI isn’t 100% reliable and “hallucinating” in a military context can cost lives. There’s always the chance that it could be hacked as well. The fact that many AI companies are neither transparent nor particularly accountable also doesn’t engender trust. OpenAI recently announced that it had won its first Pentagon contract, Google Cloud is working with Lockheed Martin on generative AI, Meta has changed its policies so that the military can use Llama AI and Anthropic has partnered up with Palantir to get Claude into the military. It looks like the relationship is deepening – and I wonder whether this will mean that it will be even more difficult for tech companies to be brought to account for undesirable behaviour…

Nvidia shares hit record high on renewed AI optimism (Financial Times, Michael Acton) just highlights a return to form for the chip maker as it edged ahead of Microsoft to become the world’s most valuable company in trading yesterday, marking a major turnaround since its shaky start to 2025 when the emergence of China’s DeepSeek caused mass-panic. Investors will no doubt have been even more buoyed by CEO Jensen Huang’s bullish outlook at its AGM yesterday. He got very excited about the “multitrillion-dollar opportunity” of AI and robotics.

Elsewhere, Dating app sacks hundreds of staff as Gen Z goes old-school (Daily Telegraph, Alex Singleton) shows that matchmaking service Bumble announced plans to cut a whopping third of its staff as part of a broader restructuring of the company. Bumble has been driven to do this because Gen Zs in particular are losing interest in dating apps, opting instead for more old-school ways of meeting partners like via sports clubs and mutual friends – and even Strava! A poll from Ipsos found that 63% of men and 66% of women aged between 16 and 24 prefer to meet partners IRL rather than via an app. Fun fact: women only account for 35% of users on dating apps because of safety and stalking concerns. * SO WHAT? * It seems that younger people now have dating app fatigue after the apps’ popularity peaked under lockdown. Bumble’s share price has cratered by an eye-watering 92% over the last five years while Match Group,

which owns Tinder among many many other brands, has seen its share price fall by 68%. TBH, I would have thought that there will always be a market for these apps – they will “just” have to find something new to get people excited again. No doubt this “new thing” will have something to do with AI?!? On a related note, I’ve often wondered why LinkedIn doesn’t offer a Tinder-like experience for jobs. If both sides have the option of “swiping right” you could potentially eliminate the huge amount of garbage you get when posting job ads. LinkedIn could even offer AI selection criteria for the employer side of the equation – for an extra fee – that would mean recruiters wouldn’t have to plough through all the “swipers”. To stop candidates spamming, I think it’d be a good idea for the number of “right swipes” to be limited on the candidate side and there would have to be some proof that they had actually READ the job ad (e.g. tick boxes in the appropriate areas, perhaps a little test at the end?). Sooooo many applicants don’t bother with even the basics…

Then in Apple-related news, Carmakers push back against Apple’s takeover of the dashboard (Financial Times, Kana Inagaki and Michael Acton) firstly highlights the release of Apple CarPlay Ultra and secondly, carmakers’ pushback. Brands including Mercedes-Benz, Audi, Volvo, Polestar and Renault said that they were not planning on bringing the upgraded software to their vehicles despite Apple’s previous assumption that they would. Why is this? Well it’s because there’s a feeling among carmakers that Apple is trying to encroach on their turf. CarPlay Ultra connects your iPhone not just to music and maps – but also to other vehicle information like temperature, speed and fuel use. The system allows drivers to do other things like switch the radio station and change the cabin temperature without leaving the app. Aston Martin has made the upgrade but other makers have been more reticent because they’ve been trying to develop their own infotainment systems to justify charging customers more. * SO WHAT? * I can understand why carmakers are annoyed with this because it’s getting harder and harder to make money out of car sales – particularly now with the booming popularity of Chinese cars. However, I don’t think that stopping Apple is the answer. It seems to me that car companies spend a lot of money on the software, but they are cr💩p at it. Just look at VW – it had to give up! I would say that you need to go in the opposite direction and make sure that vehicles can use as much third party tech as possible. Let’s face it – carmakers make cars. Apple makes software that actually works. If a potential buyer knows that they won’t be able to hook their phone up to a car there’s a real chance that they’ll choose a different car where they CAN do this.

Can Brad Pitt’s ‘F1’ Movie Finally Deliver Apple a Big-Screen Hit? (Wall Street Journal, Ben Fritz and Joe Flint) is an interesting article which suggests that F1 could be the hit that Apple has been looking for for so long (Apple has gone six years without a single box-office hit!). They want it to be Top Gun – but on land. At the moment, it only seems to be generating interest among older men but there’s a lot riding on it having wider appeal. Although it has had critically-acclaimed successes with TV shows such as Ted Lasso, Severance and Slow Horses, a real box office smash has so far eluded it.

In Federal Reserve unveils plans to reduce capital rules imposed after 2008 crisis (Financial Times, Martin Arnold and Claire Jones) we see that the Fed is looking at cutting capital requirements that will enable higher leverage at American banks. They could be the biggest reduction since the 2008 financial crisis. Basically, this means that banks won’t have to hold as much high-quality capital against loans and will free up cash to put to work in other areas. The current rules were established in 2014 as part of the reforms aiming to avert another financial crisis. * SO WHAT? * Big banks have been pushing for this for a while now but critics maintain that the requirements were put in place to stop any potential repeat of 2008. The Fed is planning a conference next month that will look at broader reform of US banking regulation.

Meanwhile, Deal hunger stirs among US banks (Financial Times, Martin Arnold, Akila Quinio and James Fontanella-Khan) highlights the current belief that the rate of US banking mergers will accelerate over the coming year thanks to more relaxed regulators, tighter competition and the need to put more money into technology. * SO WHAT? * There was initially a lot of excitement when Trump came to power regarding the outlook for M&A, but his tariffs spooked everyone badly. However, banking execs, lawyers and analysts are now coming round to thinking that the pace of activity will pick up once there’s more clarity about US trade policy, interest rates

and global economic prospects. There have been rumours of talks between BNY and Northern Trust but nothing concrete has been said yet. Given that America’s banking sector is still very fragmented, there is definitely room for consolidation.

Staying on the subject of M&A, though, Shell denies it is in talks to buy BP after reports of potential £60bn takeover (The Guardian, Jillian Ambrose) shows the oil major denying market speculation about it holding talks to buy rival BP to create what would be one of the world’s biggest oil and gas companies. Sounds interesting though, no?

Then in Big Four firms fined in new exam cheating scandal (Financial Times, Stephen Foley) we see that the US audit regulator has fined the Dutch arms of Deloitte, PwC and EY a total of $8.5m because “hundreds” of their naughty accountants cheated on internal training exams – including, ironically, ethics tests! The Public Company Accounting Oversight Board said that staff at all levels of seniority had shared answers or collaborated on tests which are supposed to satisfy ongoing training and education requirements. In case you were wondering about whether KPMG behaved in a more saintly fashion, they didn’t – they got fined $25m for the same kind of thing! I guess the next thing will be ChatGPT -usage in such tests…

In a quick scoot around some of today’s other interesting stories, Robert Kennedy to cease US funding for global vaccine alliance (Financial Times, Patrick Temple-West and Michael Peel) shows that anti-vaxxer-in-chief RFK is still on the warpath – now he will be stopping funding for global vaccine group Gavi that provides free jabs for meningitis, malaria and other diseases. Gavi is an international alliance that includes Unicef and the World Bank and the US health secretary said that it had failed to justify the billions of dollars it received in funding. Staying with pharma sector news, Drug ad ban could leave US pharma with a bad case of withdrawal (Financial Times, Lex) shows that the administration is thinking about imposing restrictions on B2C ads for pharma companies. * SO WHAT? * If this actually happens, this will be bad for pharma companies and bad for the TV network operators who make a lot of money out of it. The argument is that drug ads push healthcare costs up because they cajole patients towards more expensive drugs despite equally effective generic drugs being available. The pharma industry spent over $5bn on national TV ads last year! Companies spend hundreds of millions of dollars each on buying ads.

Elsewhere, Skoda electric car sales overtake Tesla in Europe after Musk backlash (Daily Telegraph, Matthew Field) heralds more misery for Tesla as Skoda EV sales have now overtaken Tesla in Europe as Musk’s popularity continues to slide while Skoda’s popularity rises. Figures from the European Automobile Manufacturers Association show that this is the fifth month in a row of falling sales for Tesla. And this is despite overall EV sales in Europe rising by 27.2% over the period!

In retail news, Asda owner slumps to near £600m loss as sales fall (The Guardian, Sarah Butler) highlights a poor performance for Bellis Finco, Asda’s holding company, as the UK’s third biggest supermarket’s nightmare continues with a near-£600m loss last year, M&S food sales slow after cyberattack (The Times, Isabella Fish) quantifies the effect of that cyberattack that happened over the Easter weekend (it was bad, but it seems like it’s bouncing back!) and Waitrose sales grow at fastest pace in three years amid M&S crisis (Daily Telegraph, Hannah Boland) highlights a decent performance over the quarter. This is great if it’s just more people loving Waitrose, but not such a great thing if customers return to M&S now that disruption is improving.

Further down the high street, Halfords makes loss after restructuring and higher labour costs (The Times, Isabella Fish) shows that the retailer fell into loss for the year thanks to restructuring costs and a write-down of the value of its retail business. It’s looking to close underperforming parts of its business but I have said in the past that I think it should ditch its bike business (although I’d probably keep the maintenance part going) and concentrate on cars given that EVs are going to be our future!

Haven’t done one of these for a while – so can you solve this puzzle?? The answer comes at the end of the video – so try not to cheat!

US strikes only delayed Iran’s nuclear progress, says intelligence report (Financial Times, James Politi and Demetri Sevastopulo) cites an early assessment by the Defense Intelligence Agency (DIA) which suggests that the US air strikes on Iran’s most important nuclear sites did not “obliterate” the programme – it just set it back by less than six months. Obviously, the White House and the Pentagon rejected this assessment as fake news and Trump maintained on Truth Social that the sites were “COMPLETELY DESTROYED”. The DIA is part of the US Department of Defense. Does Iran’s nuclear programme have a future? (Financial Times, Gary Samore) outlines a few different potential scenarios wherby Iran could continue its nuclear programme – but with limits – or the country could withdraw from the non-proliferation treaty (NPT) in a “race” to acquire nuclear weapons in order to deter future attacks like the ones we’ve just seen. Withdrawing from the NPT would mean that the country would no longer have to submit to international inspections, meaning that it could develop its capability away from prying eyes. Either way, Iran still has the know-how to rebuild its nuclear programme although its infrastructure has clearly suffered a body-blow. Iran also remains in possession of a large quantity of enriched uranium – the International Atomic Energy Agency (IAEA) reckons it has about 5,000kg of low enriched uranium and 400kg of 60% enriched uranium that could be turned into enough weapons grade 90% enriched uranium for about 10 nuclear weapons. Meanwhile, Gulf expat bubble punctured by missiles (Financial Times, Chloe Cornish and Simeon Kerr) looks at the reaction of expats – it seems that newbies have been most shocked but the veterans have seen it all before. * SO WHAT? * FWIW, I think it’s still early days here and it wouldn’t take take much for Iran to perhaps use terrorist tactics to disrupt the region. This will surely affect tourism in the first instance (paying money to take flights through “missile alley” to get there doesn’t sound all that appealing) but it could also stem the influx of expat professionals. On that front, it seems to me that governments in the region have been pushing for higher percentages of local hires versus expats, so perhaps recent events could accelerate this. Also, where are all those YouTube influencers going to go next?? Amidst all the uncertainty, I am sure that lawyers, tax advisers, financial advisers etc. will see an uptick in business from skittish expats…

Co-op to stop sourcing goods from Israel, Iran and 15 other countries (The Guardian, Sarah Butler) highlights one retailer ostensibly taking a stand by boycotting around 100 goods from a number of countries. * SO WHAT? * This might be a bit of a token gesture as it sources most of its products from western Europe anyway and maybe the real reason behind this is that it wants to minimise the risk of its supply chains breaking down. Still, it has a reputation for doing ethical business (remember they have banged on in the past about not investing in anything to do with fossil fuels etc.?) so I guess this makes sense.

Donald Trump signals sanctions relief for China to buy Iran’s oil (Financial Times, Demetri Sevastopulo and Myles McCormick) shows that Trump is now making a big thing about “letting” China purchase oil from Iran after months of sanctions to punish Chinese refineries for buying Iranian crude. * SO WHAT? * I’m probably being cynical here, but maybe he knew this was happening anyway so he thought he could claim a “victory” by claiming credit for it…

Then in Federal Reserve chair defends holding interest rates after fresh Trump attacks (The Guardian, Callum Jones) we see that Fed chief Jerome Powell is refusing to cave to renewed pressure from Trump to cut interest rates and says that the Bank wants to wait to see how tariffs affect US prices. The president said on Truth Social that “We will be paying for his incompetence for many years to come” but Powell maintained that “increases in tariffs this year are likely to push up prices and weigh on economic activity”. * SO WHAT? * Remember, the Fed is supposed to be independent. Trump is obviously entitled to his opinion but he should not be telling Powell how to do his job.

Closer to home, UK to purchase US jets capable of carrying nuclear weapons (Financial Times, Charles Clover) shows that Britain will buy 12 US-made F-35 stealth fighter jets that are able to carry nuclear weapons as part of a major defence strategy overhaul. Britain will join NATO’s airborne nuclear mission as the region shifts towards meeting the growing threat from Russia. Lockheed Martin of the US makes the F-35 but crucial components are made here. * SO WHAT? * This purchase will significantly increase our nuclear deterrent and it means that the RAF will now have an atomic role for the first time since the cold war.

I thought that Most Britons view US as security threat after Trump’s election (Financial Times, Amy Borrett) was quite interesting given what’s going on at the moment because it cites the results of the latest British Social Attitudes (BSA) survey which shows that 72% of Britons believe that America posed a “very” serious or “quite serious” risk to global peace in April – double the 36% of people saying the same thing last autumn before Trump got the keys to the Oval Office. Only Russia, at 90%, was seen as a bigger threat. The US is ahead of both Israel and Iran. The annual BSA survey started in 1983 and was conducted between September and October 2024 – so you would have thought that 72% will be somewhat higher now!

Stablecoins threaten global financial stability, central banks warn (The Times, Mehreen Khan) cites the Bank of International Settlements (the BIS – aka “the central bank of central banks”) as saying that the growing use of stablecoins could destabilise global finances and threaten the monetary sovereignty of countries. The BIS said that although stablecoins, a form of digital currency pegged to traditional assets such as the dollar or commodities, have “some attributes of money”, they “perform poorly when assessed against the three tests for serving as the mainstay of the monetary system”. This criticism from the BIS came just after the US Senate passed a bill known as the “Genius Act” that creates a legal framework for digital assets. * SO WHAT? * Although stablecoins are thought to be less volatile and safer than cryptocurrencies like bitcoin, there have been big failures in the past – like the collapse of terraUSD in 2022. Terra was pegged to the US dollar and saw around $50bn of its market cap evaporate. The BIS warned that “if stablecoins continue to grow, they could pose financial stability risks, including the tail risk of fire sales of safe assets”. On the other hand, you could say that banks are so against this because they stand to lose substantial amounts in transfer fees.

Grocery prices rise at fastest pace in more than a year (The Times, Jack Barnett) cites the latest figures from Kantar which shows that grocery prices rose by 4.7% in the four weeks to June 15th versus the same period last year thanks to sharp rises in prices for chocolate (noooooooo!), butter and meat. Shoppers buying fewer groceries amid surge in weight-loss drugs (Daily Telegraph, Hanna Boland) cited the same set of numbers which also showed that grocery sales were down by 0.4% thanks to more people being on obesity drugs. Apparently, 4% of households in Great Britain include at least one GLP-1 drug user, a number that’s doubled from last year. Although that number is still low, the appetite suppressing qualities of the drugs is translating into people buying fewer unhealthy snacks because people on the treatments tend to eat up to 30% fewer calories. * SO WHAT? * This is something that food producers like Nestlé have been concerned about for some time now. According to research by Morgan Stanley, those on the treatments cut back particularly dramatically on alcoholic and sugary non-alcoholic drinks! The fat loss treatments are more widely used in the US and Walmart said back in 2023 that it had seen a “slight pullback” in how much customers were putting in their baskets as a result.

Asda nears rock bottom as weeds take over unopened new stores (Daily Telegraph, Hannah Boland) portrays a sorry picture of the ailing supermarket as former retail hero Allan Leighton continues to try to turn things around with little apparent success (at the moment anyway). Hilariously, he said that he was not concerned about Kantar’s figures last month which showed Asda losing market share, adding that “we don’t really care what anybody else does”. Yeah right. You can bet your bottom dollar that he’ll be shouting such figures from the rooftops if they turn around in his favour 🤣! That being said, Kantar said that it could see signs of things turning around and that there was a good chance of it returning to growth “over the summer months”. I still think a complete overhaul is necessary but that’s going to cost a lot and the company doesn’t have unlimited funds.

In a quick scoot around some of today’s other interesting stories, Air India crash tests Narendra Modi’s ambition to get his country flying (Financial Times, Krishn Kaushik and John Reed) shows that India is still floundering in the wake of the recent Air India crash. The country had only, just weeks prior, launched its first ever lab to analyse “black boxes”. This was all part of a broader initiative by PM Modi to upgrade air travel with a swathe of new airports, airlines and infrastructure but now the priority is finding the cause of India’s worst air crash in almost thirty years. The Indian investigation team is now looking at sending the black box to the US National Transportation Safety Board, which itself would suggest that India’s civil aviation sector ambitions currently fall short of its capabilities at the moment.

In bank-related news, Spain blocks BBVA from merging with Sabadell for at least three years (Financial Times, Barney Jopson) shows that the government has now got involved in BBVA’s €11bm hostile bid for rival lender Sabadell by forbidding a merger for at least three years! * SO WHAT? * BBVA now has to decide whether it will just take it, challenge them in the courts or just drop the bid. The BBVA chair said that it would be “illegal” for the government to impose extra conditions. This development may also cause friction with the European Commission, who could potentially scupper the Spanish government’s attempt at intervention. You do wonder what impact this will have on Sabadell and its decision to sell its TSB UK banking business…

Then in Saga plans NatWest deal to expand banking products for over-50s (The Times, Patrick Hosking) we see that the over-50s insurance and travel group Saga is on the verge of signing a deal with NatWest to offer new products to its audience. It is hoping to start with a new Saga-branded savings account before rolling out others. * SO WHAT? * I think that this is a good idea, strategically. You would have thought that the company’s audience and demographic will have a decent amount of money to play with so if Saga can get the right partners in place they

can do pretty well. They might need to be a bit creative though, as we all know how hard it is to prize people out of their bank accounts! Other than this, the company’s insurance and cruise businesses continue to put in solid performances.

There were some good articles on the law today – Soaring pay rates fuel the rise of the superstar lawyer (Financial Times, Sujeet Indap), which highlights rising pay for top US lawyers – and sometimes the teams of associates they bring with them – while Trump chaos breeds opportunity for lawyers (Financial Times, Joe Miller) shows what’s happening to the lawyers who resigned from firms who “bent the knee” to Trump – they are setting up their own businesses to fight back. * SO WHAT? * This is great to see but I would have thought that you need scale to take on the big boys – and therefore I would expect there to be consolidation among the new players as time goes on.

Back home, UK graduate job openings at lowest level since 2018 (Financial Times, Delphine Strauss) cites the latest data from Indeed which shows that job openings for new grads hit a new low as nervous employers hold off on hiring and cut costs by using AI. Indeed said that the number of job ads for recent grads was 33% lower than where it was a year ago and such roles had fallen to 12% as a share of all job postings. Tough times…

Then in Aston Martin resumes car exports to US after Trump trade deal (The Times. Robert Lea) we see that the sports car company had restarted the shipment of vehicles to the US following a three month pause that came in response to Trump’s tariffs. The tariffs to the US are now 10% versus the 2.5% level they were at before (and the 27.5% that they could have been!) but the trade deal announced recently is going to come into effect from next Monday.

This guy has some impressive knife skills! Not sure what he’s going to do with the end product though – perhaps potato mille feuille? Yes, I know. I can be fancy sometimes 😁

In Israel-Iran latest: Donald Trump says Israel and Iran have agreed ceasefire (Financial Times, Zehra Munir and Sarah Provan) we see that there may be an end in sight for the conflict (or at least a pause) as Trump posted on Truth Social that “It has been fully agreed by and between Israel and Iran that there will be a Complete and Total CEASEFIRE”. Iran state TV later confirmed this but framed it differently, saying that Trump had called for a halt “in a begging manner”. Israel has yet to confirm.

In terms of impact, Oil tumbles as traders respond to Trump’s ‘ceasefire’ (Financial Times, Jamie Smyth, Myles McCormick, George Steer and Malcolm Moore) highlights a falling oil price when Asian markets opened, in response to this de-escalation but Oil majors fear threat of Iran blocking Strait of Hormuz (The Times, James Hurley, Emily Gosden and Tom Saunders) highlights nervousness as many big oil companies, such as BP, withdrew staff from Iraq’s oilfields close to Iran’s border. One of the main concerns is if Iran decides to close the Strait of Hormuz because 20% of the world’s oil and 20% of the world’s LNG goes through there – and at least six vessels had to turn back yesterday. Amid Iran market risks, watch gas as well as oil (Financial Times, Lex) highlights the need for Europe to be particularly vigilant on the gas price because although only 12% of the LNG that travels via the Strait of Hormuz is destined for Europe (82% is headed to Asia) the structure of the European gas market means that any disruption in the Strait has outsize impact because 60% of LNG is traded on the spot market – not via long-term contracts – so it is directly exposed to any wild price swings. * SO WHAT? * If LNG supply is disrupted and everyone subsequently rushes to buy it, the danger is that the energy price cap could go up to anywhere between £3,000 to £4,500 according to energy analyst Chris Wheaton at Stifel. When you consider that the price cap is going to be £1,720 from next week – so this could created serious problems.

In Donald Trump calls for immediate boost in US oil production (Financial Times, Tom Wilson and Jamie Smyth) we see that Trump reiterated his pre-election war cry of “DRILL, BABY, DRILL!!!” on Truth Social, adding “And I mean NOW!!!”. To put this into context, oil prices have increased by about 10% since Israel attacked Iran 10 days ago, but they’re still lower than they were in January. Whether or not oil companies follows Trump’s exhortations or not will probably depend on Iran’s response. America’s shale drillers have been mothballing production because oil prices had fallen below the level they need to be to make it commercially viable.

Meanwhile, Germany and Italy pressed to bring $245bn of gold home from US (Financial Times, Olaf Storbeck and Amy Kazmin) highlights domestic pressure to relocate more gold to Europe “in turbulent times”. The two countries hold the world’s second and third biggest national gold reserves after the US, according to World Gold Council data. Both are very reliant on the New York Federal Reserve in Manhattan as a custodian and they each store over a third of their bullion in the US. Given Trump’s unpredictability, the idea of repatriating gold is gaining

increasing traction to make sure that European banks have control over it. A survey this week of 70 global central banks showed that more of them were thinking about storing their gold domestically. * SO WHAT? * This just goes to show the level of concern that central bankers are feeling at the moment about their ability to access their gold in the event of a crisis – but also just how much things have changed since Trump came to power because this concern just wasn’t really an issue in the past.

The invisible threat that risks devastating air travel (Daily Telegraph, Christopher Jasper) highlights risks to air travel in the region as electronic warfare technology that’s being used by Iran, Israel and others in the region is crowding out signals modern jets use for location. This means that they can potentially lose GPS connections, go off course and collide. The International Air Transport Association is urging governments to stop airports and air traffic controllers removing ground-based navigation aids that can help if satellite guidance fails. * SO WHAT? * This is yet another thing that airlines are going to have to take into account – and it could potentially push ticket prices up at a time when consumers are feeling the pinch. If airlines have to travel further distances on different routes for safety reasons, they’ll have to use more fuel at a time when fuel prices are rising. 

US strikes on Iran could damage global growth, says IMF chief (The Guardian, Lauren Almeida) highlights the IMF doing what it does best – stating the bleeding obvious – that war is going to be bad for the global economy. Thanks for that gem, Kristalina.

Then in defence-related news, Germany to boost defence spending at faster rate than France or UK (Financial Times, Anne-Sylvaine Chassany) shows that Germany is about to increase its annual spending on defence from €95bn this year to €162bn in 2029 while UK defence funding will hit 5% of GDP by 2035, Starmer to tell Nato summit (Financial Times, David Sheppard) highlights Starmer’s longer-term commitment although Reeves said last week that defence spending won’t go beyond 2.6% of GDP over this parliament.

Back home, Keir Starmer unveils ‘targeted, long-term’ industrial strategy (The Times, Alex Ralph) considers yesterday’s unveiling of the long-awaited industrial strategy, which is the first since Theresa May’s government. The 160-page strategy document highlights eight high-growth sectors over the next decade, representing about 32% of the economy. The sectors are advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences and professional and business services. A 16-member independent advisory council will oversee its delivery and measure its effectiveness. Five of the sector plans were released yesterday with those for life sciences, defence and financial services to come. It’s good that we’ve got a plan to aim for – all we’ve got to do now is execute it!

US House of Representatives bans WhatsApp on government devices (Financial Times, Hannah Murphy, Stephanie Stacey and Alex Rogers) highlights a ban on using Meta’s messaging platform, deeming it “a high risk to users”. Staff have been asked not to download or keep it on any House laptops or mobiles from June 30th. Anyone who has the app after that will be asked to remove it. The decision was taken due to “a lack of transparency in how [WhatsApp] protects user data, absence of stored data encryption, and potential security risks involved with its use”. * SO WHAT? * This sounds very strange to me. WhatsApp makes a big thing about messages being “end-to-end encrypted by default”, meaning that no-one can read them! A spokesperson for Meta pointed out that the platform offered “a higher level of security than most of the apps on the CAO’s [Chief Administrative Officer’s] approved list”, which includes Signal, the platform which defence secretary Pete Hegseth used to accidentally share details of military strikes. Is Trump going to use this to put pressure on Zuckerberg to do something for him?? It just seems weird that the administration seems to be attacking a “national champion” for no apparent reason…

Amazon invests $40bn in major UK expansion (The Times, Katie Prescott) heralds a big investment by the e-tailing giant over the next three years that will include four robotic fulfilment

centres and an upgrade of its film studios in Berkshire, all of which will create thousands of jobs. For customers, it’ll mean that more goods will be available on the same day! Fun fact – Amazon is one of the top ten private employers in the UK with 75,000 employees!

The Florida phone network behind Trump Mobile’s ‘Made in America’ ambitions (Financial Times, Michael Acton) is an interesting article that looks into the Trump Organization’s efforts to enter the smartphone industry with a device that has all the smartphone functionality users have become used to – but all made in America with a launch date for the “T1” in September. The chief exec of Purism, an electronics company that makes smartphones in California, said that he doesn’t think that such a high-spec phone can be 100% made in the US. Purism’s devices are aimed at niche customers, like government agencies, who like its “secure” US supply chain and its open source operating system – but the downside is that it doesn’t have the technical features or range of apps that Android or Apple phones have. In order to be able to put the “Made in the USA” on the label, “all or virtually all” of the product has to be made in the USA, according to current FTC guidelines. We’ll just have to see how this works out!

In a quick scoot around some of today’s other interesting stories, Cobalt price jumps as DR Congo extends export ban (Financial Times, Camilla Hodgson) shows that the cobalt price jumped by almost 10% yesterday on the announcement by the DRC’s Strategic Mineral Substances Market Regulation and Control Authority that the four-month cobalt export ban imposed in February would be extended to September. * SO WHAT? * The cobalt price has cratered by about 60% in just over three years and the government wants to stem the slide in cobalt’s price. The metal is a key material used in some EV batteries but there’s been too much of it knocking around for a while now.

Oman to be first Arab state in the Gulf to levy personal income tax (Financial Times, Chloe Cornish) shows that Oman is on track to be the first in the region to introduce personal income tax! A royal decree was made on Sunday by Sultan Haitham bin Tariq Al Said about a 5% tax on Omani residents’ earnings over $109,000. This won’t come into force until 2028 and only 1% of Oman’s 5m inhabitants are going to be paying the tax. * SO WHAT? * Even though this is really rather low, it’s possible that rich Omanis may just move to other Gulf states. That being said, other countries in the region might think of doing something similar. Oman in particular is having trouble weaning itself off oil revenues so this is seen as a way of diversifying the government’s income.

New York to Build One of First U.S. Nuclear-Power Plants in Generation (Wall Street Journal, Ryan Dezember and Jennifer Hiller) heralds the construction of a brand new nuclear power facility at a site in upstate New York. It will be the first major new US plant for over 15 years and could prompt further construction of nuclear reactors! Only five new commercial reactors have come online in the US since 1991 – so this is a big deal. A number of potential sites are under consideration.

In Revolut CEO ‘could get multibillion-dollar windfall if its value passes $150bn’ (The Guardian, Kalyeena Makortoff) we see that founder Nik Storonsky could get paid billions in a pay deal that is unlocked if he manages to push the value of Revolut past $150bn. The deal has been likened to the one that Musk had with Tesla. Storonsky will hope that his contract is legally watertight!!! I included this story because it’s mentioned everywhere – but TBH, I don’t think that it’s all that important in the scheme of things (although perhaps it might encourage other founders to negotiate similar terms).

This dog is clearly very talented – but, crucially, seems to be having a great time!

So things got turned up a notch in the Israel-Iran war over the weekend. Donald Trump gambles his presidency as US enters war with Iran (Financial Times, James Politi, Lauren Fedor and Steff Chávez) highlights Trump’s big gamble as he approved the attack on Iran on Saturday night, betting that Israel’s initial crippling strike would limit US involvement whilst making a decisive move now would maximise chances of success and force Iran to go for a settlement. If he’s successful, he will have achieved something that America has not been able to do in decades – eliminate the Iranian nuclear threat. However, Trump faces backlash from Maga base after strikes on Iran (Financial Times, Guy Chazan) shows that some of his staunchest supporters were against US strikes on the nuclear facilities in Fordow, Natanz and Isfahan for fear of entering yet another “forever war” while How the US used stealth and decoys to launch surprise attack on Iran (Financial Times, Demetri Sevastopulo, Henry Foy, James Schotter and David Sheppard) goes into more detail on how it was carried out. In short, a pair of B-2 stealth bombers ostensibly flew to the Pacific, as if they were going to Guam. They were decoys. At the same time, seven other B-2s flew east in stealth mode and then dropped 14 huge bunker-buster bombs on Iran’s nuclear sites in Operation Midnight Hammer. This effort was also helped by Trump talking about a two-week timeline for negotiations, which will have added to the element of surprise. Also, most allies got no notice. Even the UK only got a few hours’ notice – but the US did co-ordinate with Israel. Trump taunts Iran with prospect of ‘regime change’ after strike on nuclear sites (Financial Times, Steff Chávez, Demetri Sevastopulo, James Politi, Najmeh Bozorgmehr, Bita Ghaffari and Neri Zilber) shows the way that Trump’s thinking in a post on Truth Social after the bombers returned to Missouri, which said that “It’s not politically correct to use the term, “Regime Chance,” but if the current Iranian Regime is unable to MAKE IRAN GREAT AGAIN, why wouldn’t there be a Regime change??? MIGA!”. The perils of war with Iran (Financial Times, Gideon Rachman) shows that while Iran’s longtime efforts to push its interests across the region, via the sponsoring of Hizbollah, Hamas and the Houthis, have now failed. All the while, Iran advanced its efforts to make its own nuclear bomb. Assad’s regime has fallen, Hisbollah and Hamas have been greatly depleted by Israel and now the Iranian regime itself is under direct pressure. The main problems here lie in what happens next because it is going to take a lot for the US to be able to claim a real victory, which would entail a complete dismantling of Iran’s nuclear programme and a regime change to a pro-western government. Neither of these look likely at the moment. Even if the regime fell, there could be civil war that could then drag neighbouring countries (and potentially the US again) into the mess and/or incubate terrorists. Iran, Israel and the US are all losers here because Iran is going to be unstable, whichever way you look at it, Israel’s too small to become the leader of the Middle East and could be blamed for bringing the US into another forever war (something that could hit Trump’s standing in the midterm elections at the very least) while US involvement could divide Trump’s support and empower the Democrats.
Trump has opened a Pandora’s box (Financial Times, Edward Luce) emphasises that Trump is not in control of what’s going to happen next and there’s a risk that this action could define his presidency both domestically and internationally. If Iran’s regime gives up, his actions would be applauded but if this escalates into a full war then it could be bad for his presidency. In doing what he did over the weekend, he not only bypassed Congress, he probably also broke international law. Trump’s step into the dark (Financial Times, the Editorial Board) observes that America’s intervention now gives Iran an excuse to attack energy assets in the Gulf along with US bases and ships around the Middle East.

In terms of retaliation, Iran vows revenge on US, threatening to block vital shipping lane (The Times, Gabrielle Weiniger, Marc Bennetts, David Charter and Joshua Thurston) shows that Iran is threatening to block the key Strait of Hormuz trading route but although parliament voted to do so, Iran’s leaders are also considering other options. 20% of the world’s oil supplies travel through the Strait of Hormuz. US warns Iran closing Strait of Hormuz would be ‘economic suicide’ (Daily Telegraph, Matt Oliver and Kieran Kelly) shows that America is against this move and Iran steps up repression amid warnings of terror attacks in UK (The Times, Fiona Hamilton, Matt Dathan and George Greenwood) highlights the case of the family of a UK-based journalist who have been detained in Tehran. The family of one of Iran International’s presenters have been taken into custody by the Islamic Revolutionary Guard Corps. The independent Iran International has its HQ in London and holds the Iranian regime to account. They want the journalist to resign.

More broadly, Oil price jumps after US strikes Iran (Financial Times, Tom Wilson and Jamie Smyth) shows that oil prices hit a five-month high on news of the bombing, Oil ‘will surge above $100 a barrel’ if Iran blocks Strait of Hormuz (The Times, Emily Gosden) cites analysts who believe that oil prices could breach $100 a barrel if the Iranians decide to block the Strait although Oil prices steady as investors wait for Iran response (The Times, Gabrielle Weiniger, Marc Bennetts, David Charter and Joshua Thurston) show that prices calmed down after the initial spike mentioned above. Jet fuel prices soar in Europe as war in Middle East threatens supplies (Financial Times, Malcolm Moore) highlights another consequence of this as diesel and jet fuel prices have now hit 15-month highs while British Airways and Singapore Airlines cancel Dubai flights after US bombs Iran (Financial Times, Kana Inagaki, Mari Novik and Chloe Cornish) heralds other immediate actions as over 150 carriers have now diverted or suspended flights that enter airspace over Israel, Iraq and Jordan. This is going to be especially difficult for European carriers who already have to avoid Russian airspace to fly to Asia.

In terms of reaction in the region, Gulf allies shaken by Trump’s Iran strikes (Financial Times, Chloe Cornish and Andrew England) shows that Gulf states are in a bit of a pickle given that Iran has long been a military and political rival in the region, their high profile support of Trump in recent weeks will put them in Iran’s crosshairs. The countries in the region have been trying to avoid this situation by pursuing years of diplomacy. Gulf nations like Saudi Arabia and the UAE are within reach of Iran’s short range missiles and host key US military bases – so things could get nasty. Reactions have been varied, but Bahrain sent 70% of its civil servants home, initiated remote learning from schools and advised motorists to avoid main roads. At the moment, Gulf states are voicing support for Iran but also maintaining relations with the US. * SO WHAT? * Overall, it all depends how Iran decides to react. If it decides to retaliate, in addition to all the obvious human cost, this is bound to destabilise the global economy by making oil prices more expensive, pushing up freight rates and slowing down global commerce which has already taken a hit from Trump’s tariffs. It will push up living costs and could potentially hit airlines and tourism around the world – but particularly in the Middle East. You do wonder whether we’ll see more emigration from the region as a result. Although it’s too early to call I would bet my mortgage on there being an exodus of rich people. Even if Iran decides to capitulate completely (which I doubt) there will be enough resistance and ill-feeling in the region that will make things edgier for some time to come.

In other defence-related news, Spain secures opt-out from new Nato spending goal, says Sánchez (Financial Times, Barney Jopson and Henry Foy) highlights a deal for Spain not to have to increase its defence spending to 5% of GDP, the target demanded by Trump. At the moment, the country is not even meeting NATO’s current target of 2% of GDP! All eyes will now be on Italy, Belgium and Portugal who will also find it tricky to hit this target. Spain reckons it’ll be able to hit all of its NATO obligations by spending 2.1% of its GDP on defence. * SO WHAT? * Is this because of Spain’s pacifist streak? Or is it a distraction to curry favour with an electorate that is currently being faced with governmental corruption allegations??

Elsewhere, Taiwan launches unity drive as China threat looms (Financial Times, Kathrin Hille) shows that Taiwan’s president launched a drive for national unity yesterday to unify his people in the face of ongoing Chinese aggression. He reiterated Taiwan’s independence but this could prove to be problematic if China decides to step things up militarily.

Back home, Energy prices cut for business as part of UK industrial strategy (Financial Times, Anna Gross, Ashley Armstrong and Jim Pickard) highlights the unveiling by PM Starmer of a new “British Industrial Competitiveness Scheme” later today that will invest £2bn over four years to reduce energy prices by up to 25% for thousands of businesses as part of this wider strategy. It will affect sectors including automotive, aerospace and chemicals. The scheme will exempt companies from having to pay various green levies and will come into effect in 2027. * SO WHAT? * This is great news for those who are encompassed by this, but not so much by companies in other sectors like retail and leisure who have complained for a long time about the effect of high energy bills and rising staff costs – and don’t get a look in. At the moment, it’s not clear how the government will finance these policies.

Who are the companies hoarding bitcoin? (Financial Times, Philip Stafford and Ray Douglas) is a really interesting article which takes a look at which companies are stockpiling bitcoin! Over the last year, the amount of bitcoin that companies hold has skyrocketed by almost 170% so now around 130 listed companies hold a total of $87bn of bitcoin combined, according to the latest data from BitcoinTreasuries.net. This is equivalent to about 3.2% of all the bitcoins that will ever exist. One firm that has transformed its fortunes is software company MicroStrategy – now called Strategy – which became a $100bn company by becoming a bitcoin-buying vehicle. Companies in the US, Japan and France are now are jumping on the bitcoin bandwagon by selling shares and bonds and putting the proceeds into bitcoin. TMTG, Twenty One, Tesla and one-time hotel developer Metaplanet are among the companies deciding to plough money into bitcoin whatever their main business is. Block – originally known as Square and founded by former Twitter chief Jack Dorsey – started investing in bitcoin in October 2020 and continues to advocate that bitcoin will “ultimately become the native currency of the internet”. * SO WHAT? * This is all pretty

amazing and once again shows bitcoin approaching the mainstream. Although I’m not sure that shareholders will be comfortable with so much exposure to it, the more companies and individuals pile in, the more it’s going to go up – and therefore justify the decision to jump on the bandwagon in the first place. I think that as long as proper risk controls are put in place there’s nothing wrong with this. It may make for some sleepless nights down the road though!

In Spac revival puts spring in step of investors in New York (Financial Times, George Steer) we see that SPACs are coming back after a few years in the wilderness. Last week’s SPAC Conference 2025 was hosted in New York and was attended by a record number of guests. This has come at a time of uncertainty for conventional IPOs and there was talk of “renewed focus on quality deals and due diligence…[and a] shift to prioritising SPAC targets in desirable industries with sold revenue”. Well I’ll believe it when I see it! Right now, crypto is driving the SPAC boom – so we’ll have to wait and see how this turns out!

Tesla launches robotaxi service in Austin (Financial Times, Rafe Uddin, Stephen Morris and Kana Inagaki) heralds the launch of Tesla’s much-anticipated Model Y robotaxis yesterday with 10 vehicles and a safety driver on board with customers paying a $4.20 flat fee. Tesla’s Robotaxis Are Here: What You Need to Know (Wall Street Journal, Becky Peterson) says that the company ultimately wants to introduce two specially-designed robotaxis – the small gold-coloured Cybercab sedan and a large multiseater called the Robovan, neither of which have steering wheels or pedals. The aim is to have them on the road sometime in 2026. At the moment, though, passengers must be over 18 and vehicles can only take a max of two passengers. * SO WHAT? * This all sounds great and the company wants to expand to San Francisco, Los Angeles and San Antonio with hundreds of thousands of vehicles driving fully autonomously on American roads by the end of 2026. However, it still needs to prove safety!

Talking of taxis, Are air taxis set for take-off or are there still many headwinds? (The Times, Robert Lea) indicates that the future of air taxis is looking a bit shakier. The CEO of Rolls-Royce

said at The Wall Street Journal CEO Council Summit earlier this month that the reason why his company ditched investment in this area despite having invested around £100m was because this read looked more problematic and that the returns from SMRs would be much better. He added that the cost of the flying taxis kept going up. Originally, they were going to cost £1m each but this edged up to £3m. * SO WHAT? * Britain’s Vertical Aerospace was in big trouble because of Rolls-Royce pulling out because it had been working closely with the engineer and rival German start-ups Lilium and Volocopter fell into insolvency. Vertical has survived, just, and Trump sounds like he’s going to give flying taxis a boost as one of his executive orders aimed to bring a close to the “regulatory deadlock” around flying taxis in the US. Rival operators include Joby Aviation, Archer Aviation, Wisk Aero, Beta Technologies and EHang. I maintain my own scepticism about this as it’s difficult enough to find places to fly drones anyway – let alone flying taxis with people in them! And what about drone deliveries?? I just think it’s not practical. It sounds great but too expensive. I still think military use is the way to go – particularly in the world we’re seeing at the moment!

In a quick scoot around some of today’s other interesting stories, Summer goods give Sainsbury’s a boost (The Times, Isabella Fish) highlights improved sales for the supermarket thanks to warmer weather prompting customers to buy lollies, bags of ice, barbeque meats and rosé wine.

Elsewhere, UK AI start-up PhysicsX nears $1bn valuation (Financial Times, Kieran Smith) shows that the London-based AI start-up has raised $135m from investors at its latest funding round, giving it an implied valuation of almost $1bn as it takes advantage of an uptick in interest in defence tech. The company uses AI to better design products in the manufacturing and defence industries.

Then in Tourist spending in UK subdued by inflation and strong pound (The Times, Jack Barnett) we see that the latest figures from the CEBR show that retail spending per tourist is likely to grow by half the expected rate of GDP growth by 2030 thanks to the impact of high inflation, a strong pound and the end of VAT-free shopping.

Here’s a potential breakfast option for you – but you will definitely need a decent non-stick pan for this!

In Israel-Iran war news, Gulf monarchies hold rival Iran close as Israel conflict rages (Financial Times, Chloe Cornish and Andrew England) we see that Saudi Arabia, the UAE and other states are in constant contact with Tehran trying to avoid getting swept up in the war given that they host American bases that could be subject to retaliation if the Americans go all-in with the Israelis and that they don’t want Iran to close the Strait of Hormuz. They have expressed support for Iran and condemned Israel’s attacks. Donald Trump says talks with Iran could happen ‘in the near future’ (Financial Times, Aime Williams, George Parker, David Sheppard, Leila Abboud and Najmeh Bozorgmehr) shows that the president is giving himself a buffer regarding whether or not to enter the war. How Trump can offer Iran a way out (Financial Times, Richard Haas) provides an excellent summary of what’s gone on so far and suggests that Iran could accept a diplomatic deal that would necessitate it handing over all the elements of its nuclear programme and agree to regular inspections by the International Atomic Energy Agency (IAEA) – but in return it wouldn’t have to suffer from wide-ranging economic sanctions and the US could withdraw its threat to attack. This sort of agreement has been reached before in 1988 with Ayatollah Khomeini, so perhaps successor Ayatollah Khamenei will do the same. The alternative is that the US enters the war and surrounding countries gets dragged in. As a result, US forces’ effective response to military challenges elsewhere will become diluted. * SO WHAT? * Unless Fordow is completely destroyed, Iran will forever intensify its efforts in making nuclear bombs because it will be justified by the Israeli threat – and that will have the effect of destabilising the whole region.

In response to all this, Gulf companies prepare contingency plans amid fears of conflict spillover (Financial Times, Chloe Cornish and Ashley Armstrong) highlights a “sharp increase” in inquiries from companies in the Gulf region for risk advisory groups like Control Risks, Kroll and International SOS about what actions they should take in the event of Israel-Iran war escalation while Tanker rates double as shipowners steer clear of Strait of Hormuz (Financial Times, Robert Wright) highlights rising shipping costs thanks to shipowners not wanting to use the waterway and Biofuel prices jump as Israel-Iran conflict drives hunt for oil alternatives (Financial Times, Susannah Savage) shows the effect on biofuel prices as companies seek out cheaper energy sources due to crude price rises.

Elsewhere, Russia on brink of recession, says economy minister (Financial Times, Max Seddon) cites Russia’s economy minister acknowledging the effect of the Ukraine war on the economy three years on from Putin ordering the invasion. Putin jacked up defence spending by 25% last year and higher spending has powered two years of GDP growth on the trot after a 4% fall in 2022. * SO WHAT? * This has led to chunky wage rises and a tight labour market but this year has seen a cooling off and the ministers said that “we’re basically already on the brink of falling into recession”. All of this is putting more pressure on Russia’s central bank governor, Elvira Nabiullina, to accelerate interest rate cuts to reduce high borrowing costs and stimulate the economy. She cut rates by 1 percentage point to 20% earlier on this month.

Then in Canada imposes tariffs on steel and aluminium to curb imports (Financial Times, Ilya Gridneff) we see that Canada’s PM Carney announced measures to protect the country against a flood of steel and aluminium imports, adding that he could increase taxes on the US based on how talks with Washington go by July 21st. The new measures are clearly aimed at defending against an influx of cheap Chinese steel.

Meanwhile, Switzerland cuts interest rates to 0% (The Times, Mehreen Khan) shows that the Swiss National Bank cut interest rates from 0.25% to zero – its sixth cut in a row. The move was widely expected and it indicated that further cuts could be made, taking it into negative territory which it last saw in 2015-2022. The decision to cut was prompted by falling inflation and a rising Swiss franc.

Back home, Bank of England keeps interest rates at 4.25% but hints at cuts to come (The Guardian, Phillip Inman and Heather Stewart) shows that the Bank of England left rates unchanged while the markets are now pricing in two more cuts going into the end of the year. Given weak underlying GDP growth, there will be pressure on the Bank to do what it can to stimulate the economy.

In Solar bankruptcies mount as Congress slashes green energy funds (Financial Times, Martha Muir and Amelia Pollard) we see that Trump’s de-greening agenda is starting to take effect as two major clean energy firms filed for bankruptcy this month – residential solar provider Sunnova and financing firm Mosaic. * SO WHAT? * These two companies are the biggest casualties so far of Trump’s proposed spending bill that will dramatically cut clean energy tax credits. It’s not looking good for the industry at all…

Pernod Ricard to restructure business to cut costs in market slump (Financial Times, Adrienne Klasa and Madeleine Speed) highlights a new initiative by the drinks maker to streamline its business in response to the weakening global market for alcohol. It said that it will centralise some functions and administration, which is bound to lead to some job cuts. The brands will be divided into two – one that will comprise of its whiskey, champagne and cognac brands while the second one will be made up of other spirits and aperitifs. The exact headcount reduction has not been announced yet because the company’s still trying to work it out. * SO WHAT? * Pernod Ricard is not alone in suffering from increasingly thrifty consumers and changing habits regarding alcohol. I’ve already said that Diageo is suffering as “the kids” are doing karaoke sober and it’s difficult to see how this is going to change any time soon. I am expecting related retailers like Majestic to be suffering as well but I haven’t heard much about this recently…

In other business trends news, UK manufacturing poised for funding boost to reduce energy costs (The Guardian, Rob Davies and Jasper Jolly) shows that UK manufacturing is likely to get support from the government as ministers discuss policies that target high-electricity-use businesses in particular as well as manufacturers more broadly. Energy intensive industries have long complained about having to pay more for their electricity than their European counterparts whilst also facing difficulties in recruiting skilled employees. * SO WHAT? * This movement on energy costs will be welcomed but it’s still likely that energy costs will be higher than they are on the Continent because our electricity prices are based on the cost of wholesale gas, which makes up a bigger proportion of our energy mix. Still, it’s a move in the right direction…

In investment news, Spacs are hot again, and even Goldman wants a piece of the action (Financial Times, Craig Coben) highlights the return of Goldman Sachs to the world of SPACs that it profited from hugely until 2022 when it abruptly exited the market. * SO WHAT? * SPACs are staging a comeback and it’s interesting to see how forgiving the market has become about

reputational risk when fees are on the table. At this point last year, there were $2bn-worth of SPAC-backed deals – but so far this year, we have seen $11bn worth. OK so this is still way short of the peak of $172bn in 2021, but it is still a considerable rebound of activity from last year! At the moment, deal sizes are smaller and investors are being quite picky but you would have thought that activity will pick up – pending the impact of Trump tariffs and geopolitical developments, of course. SPACs are still pretty controversial, leading to them acquiring the nickname of “Shell Promoters Acquiring Cr@p” 🤣. Now that Goldman is dipping its toes back in the water, there is no doubt that others will follow it just because of the FOMO!

In Britain’s biggest bank to cut UK investments in snub to Reeves (Daily Telegraph, Louis Goss) we see that Lloyds Bank’s pensions division, Scottish Widows, is looking at cutting its exposure to UK equities and switch it out to better-performing markets. This flies in the face of the chancellor who is trying to get British pension funds to invest more in British assets. It did not sign up to the Mansion House Accord which is a document signed by 17 of Britain’s biggest workplace pension providers to invest at least 5% of funds held in defined contribution schemes into UK stocks by 2030 – and now it’s planning to cut its exposure to UK stocks in its highest growth fund from 12% to 3%! It’s also looking to cut UK investments in its most conservative fund from 4% to just 1% and aims to complete these changes by January 2026. * SO WHAT? * This is a bold move and if it goes badly it will be very embarrassing. Given investor reaction to Trump shenanigans going on across the Atlantic – that they are pulling money out of the US and putting it elsewhere – you would have thought that British stocks should at least see some uplift although it seems that more of it is winging its way to Europe. Also, given that everyone else has promised to push UK stocks, you would have thought that would provide some underpinning at the very least! Something definitely needs to be done about the outflow from the LSE though in order to address confidence issues….

In employment news, UK jobs market sees modest growth in new postings (The Times, Helen Cahill) cites the latest data from REC which shows “some resilience” in the UK jobs market although Recruiter Hays warns global slump in hirings will halve its profits (The Guardian, Lauren Almeida) highlights how the volume recruiter is still in the doldrums as it warned that profits could halve thanks to a sharp drop in demand for permanent staff. This gloomy mood seems to be prevalent across the whole recruitment industry at the moment…

In Elon Musk’s X to offer investment and trading in ‘super app’ push (Financial Times, Hannah Murphy and Daniel Thomas) we see that users will “soon” be able to trade on X as it moves towards Musk’s aim of making X the “everything app” as per WeChat in China. CEO Linda Yaccarino said that “You’ll be able to come to X and be able to transact your whole financial life on the platform” and that X was also looking at introducing an X credit or debit card potentially by the end of this year.

Then in Tesla’s robotaxi ambitions face a reality check after launch (Financial Times, Richard Waters) we see that Tesla’s ride-hailing service will launch this weekend with rather less fanfare than had been expected in Austin, Texas , as there will only be about 10 cars and they will be geo-fenced to avoid the city’s trickiest intersections and come with teleoperators that can take over in the event of any problems. * SO WHAT? * A lot of Tesla’s stellar valuation is based on the promise of a robotic and automated future and although this launch is a few years late, it is at least a first step – but it’s still got LOADS to prove. Although Google’s Waymo is more established

with about 1,500 driverless taxis in four US cities, Tesla has some important advantages up its sleeve – that its Cybercab is purpose-built and will sell for way less than $30,000. Waymo’s, on the other hand, is loaded with expensive sensors and users a Jaguar with a list price of over $70,000. At the moment, Waymo is ahead in terms of the level of autonomy it can achieve. However, Tesla could potentially scale up quite quickly if it wanted to. We’ll just have to see how this goes!

Meanwhile, Analysts are downbeat on Tesla but investors are still buying (The Times, Emma Powell) shows that earnings estimates from analysts have been steadily pared back since January and even Musk himself cut profit forecasts for this year thanks to the effect of his controversial political rants, lack of new car models and tightening competition. Still, as I said above, there’s a lot of hope for Tesla’s involvement in the robotic revolution and maybe we are reaching a crossroads for the firm…

In a quick scoot around some of today’s other interesting stories, France to double stake in Eutelsat as Europe looks for rival to Elon Musk’s Starlink (Financial Times, Peggy Hollinger and Leila Abboud) highlights intentions of the French government to more than double its stake in satellite operator Eutelsat that will consolidate its hold of OneWeb, Europe’s answer to Musk’s Starlink. The state’s current stake of 13.6% will rise to almost 30% and will reduce the UK’s 11% stake in Eutelsat to 7.9%. * SO WHAT? * This is important given worries about relying too much on Starlink – and it comes just one day after the French military agreed a 10-year deal to buy satellite comms service from OneWeb. Eutelsat has been a bit of a money pit but given America’s

somewhat changeable stance on defence (particularly in Europe) it is imperative that an alternative to Starlink be nurtured for all of our sakes!

Back home, UK consumer confidence up but fragile amid tariff and Middle East concerns (The Guardian, Julia Kollewe) cites the latest GfK consumer confidence survey which says that confidence among UK consumers has improved but is still subject to concerns about petrol prices and the effects of war in the Middle East. * SO WHAT? * This heralds a bit of a rebound from last month, where sentiment hit its lowest level since November 2023.

AI continues to serve up some incredible creations! Here is a very weird video of world leaders as you’ve never seen them before…

Donald Trump says he ‘may or may not’ strike Iran (Financial Times, Steff Chavez and Bita Ghaffari) shows that the president is either keeping everyone guessing/doesn’t know what to do/is hoping that the situation resolves itself and added that next week would be “very big” in determining subsequent developments. This came after Iran’s supreme leader Ayatollah Ali Khamenei warned Washington of “irreparable damage” if America got involved. Meanwhile, Donald Trump edges closer to Iran strike as military assets move into position (Financial Times, Steff Chavez) shows that the USS Nimitz, one of the US’s 11 nuclear-powered aircraft carriers, left the South China Sea and headed towards the Middle East with its strike group of three guided-missile destroyers to join another strike group and other destroyers in the region. They will take about a week to arrive, but it seems like Trump is getting his ducks in a row. This is a clear sign that Trump is seriously considering joining forces with Israel against Iran. If the US got involved, it’s likely that they would want to strike the Iranian nuclear facility of Fordow with its bunker-busting bombs. Steve Bannon warns Donald Trump Iran strike would ‘tear’ apart the US (Financial Times, Lauren Fedor) shows that Trump’s former chief strategist does not want the president to involve the US military in another war in the Middle East, saying that “We can’t have another Iraq”. * SO WHAT? * Trump is in a difficult position here. On the one hand, he promised his MAGA base that he would put America first and no longer engage in so-called “forever wars” but then the latest opinion poll showed that the majority of his supporters are opposed to the US striking Iran. Then on the other hand, he has essentially been handed a unique opportunity to cripple Iran’s nuclear bomb ambitions…*** NEWS JUST IN – Trump approves Iran attack plans (Daily Telegraph) shows that the president has approved attack plans to military chiefs in the White House’s situation room but “has not made a final decision”. ***

Meanwhile, Federal Reserve holds interest rates, defying Trump’s demand to lower them (The Guardian, Callum Jones) shows that the Fed kept US interest rates on hold yesterday in the

4.25-4.5% range but said that they were considering making two cuts this year. This goes against Trump’s wishes, because the president wants immediate rate cuts. Guessing that Powell would dig his heels in prior to the announcement of the decision, he accused the Fed chief of being “a political guy who’s not a smart person”.

Back home, UK inflation eases slightly to 3.4% as food price rises offset transport cost falls (The Guardian, Phillip Inman) cites the latest inflation figures which weakened slightly last month thanks to sharp drops in air fares and petrol prices taking the edge off the jump in annual food inflation. * SO WHAT? * This is clearly something that the Bank of England needs to take into account when it makes its interest rate decision later today but the markets are expecting interest rates to remain unchanged at 4.25%.

In Starmer puts UK cabinet on alert for potential US attack on Iran (Financial Times, George Parker, David Sheppard and Charles Clover) we see that Starmer is preparing the ground for potentially joining up with the US in attacking Iran. We’ve stayed out of the Israel-Iran war thus far, but it clearly looks like this may change. For the moment, Starmer has continued to call for “de-escalation”.

Then on more mundane matters, HS2 delayed beyond 2033 as minister attacks ‘appalling mess’ (The Guardian, Gwyn Topham) shows that the government has delayed the completion of HS2 until after 2033, obviously blaming the previous government. I think that this will be greeted with a nationwide eye-roll as yet another big public sector project overruns and goes over-budget. TBF, it must be incredibly hard to cost-up such an extensive project but then again you could argue that people are actually paid to do this and get it right…

OpenAI made the headlines for a few reasons today! Microsoft prepared to walk away from high-stakes OpenAI talks (Financial Times, Cristina Criddle, Tabby Kinder, Rafe Uddin and George Hammond) shows that the software giant is apparently prepared to walk away from its multibillion-dollar alliance with OpenAI due to strategic differences. If it walked away, the current contract would allow Microsoft access to OpenAI’s tech until 2030 but talks are ongoing. * SO WHAT? * OpenAI needs to hammer a deal out with Microsoft to transition from a non-profit organisation to a for-profit one which could then lead to more funding and potentially an IPO. Microsoft has to approve this move by the end of the year or OpenAI could lose billions in funding from other investors. One of the sticking points has been what slice of OpenAI it should get in return for the $13bn+ it has invested in the company to date. Another has been Microsoft’s exclusive access to OpenAI’s technology. Microsoft has been weaning itself off reliance on OpenAI in recent months, making xAI’s Grok available to cloud computing customers, for instance.

OpenAI boss accuses Meta of trying to poach staff with $100m sign-on bonuses (The Guardian, Robert Booth) shows that OpenAI’s Sam Altman is accusing Meta of trying to poach his top AI experts with things like signing bonuses of $100m as everyone chases after the same

pool of talent. Altman spoke about this in a podcast on Tuesday but this has not been confirmed by Meta. * SO WHAT? * This comes after recent reports that Anthropic is poaching talent from OpenAI and DeepMind. With crazy pay offers like the one I mentioned above, it may just be cheaper for tech companies to buy rivals rather than individuals!

Then in Netflix to start streaming live TV for the first time (Daily Telegraph, James Warrington) we see that Netflix is going to start broadcasting live TV from France’s biggest commercial broadcaster TF1 that will allow subscribers in the country to watch live TV. * SO WHAT? * This is a very interesting development and comes at a time when terrestrial broadcasters are losing audiences. You would have thought that similar deals will now be struck with the likes of BBC, ITV and Channel 4 as this could bring in much needed revenues for the broadcasters while Netflix will gain access to  decent content. The deal with TF1 is the first time that a streaming channel will have carried live channels in full, though! Actually, as time goes on you would have thought that this kind of deal will do wonders for sales of VPN sellers like NordVPN and Surfshark.

House prices fall after stamp duty changes, but rebound expected (The Times, Tom Howard) cites the latest data for April from the ONS which shows that house prices fell for the first time since December 2023 thanks to the increase in stamp duty costs. Buyers got into a frenzy to beat the stamp duty deadline of March 31st in order to save a potential £11,250 in fees, which meant that April got a bit quieter, hence the slight fall. * SO WHAT? * The ONS figures are watched very closely because they use Land Registry figures of actual sale prices as opposed to asking prices or mortgage approvals. What this data is saying matches up with what estate agents have been saying in recent months, that they’ve had a busier February and March this year than they’ve had for the past three! Economists expect prices to rebound from here though…

Non-doms’ retreat hits London’s prime housing market (Financial Times, Maisie Grice) cites a separate bit of research from London property firm LonRes which shows that the number of deals done in London’s prime housing market last month fell sharply as international buyers lost interest. * SO WHAT? * This section of the market, with properties costing over £5m, has been

particularly badly hit by the falling number of non-dom buyers who have traditionally been big in this segment. They have either moved out of the country already or are considering doing so, hence the lack of interest in buying properties.

Then in US housing construction falls to 5-year low as tariffs weigh on sector (Financial Times, Stephanie Stacey) we see that the building of residential properties in the US hit a new low in May – its lowest since Covid brought a halt to construction projects in 2020 – thanks to builders having to contend with volatiles tariffs on imported materials, higher mortgages rates and ongoing high inventory levels. Permits for new construction also fell to their lowest level since June 2020. * SO WHAT? * This is yet another example of the effect of Trump’s tariffs. When faced with uncertainty and volatility, businesses are just hunkering down to wait for the storm to blow over. Separately, a survey published on Tuesday by the National Association of Home Builders and Wells Fargo, showed that homebuilder sentiment has hit its lowest level since 2022!

In a quick scoot around some of today’s other interesting stories, NatWest rules out bidding for TSB (Financial Times, Akila Quinio, Simon Foy, Ivan Levingston and Arash Massoudi) shows that NatWest has decided to step away from the bidding process for TSB but Banco Santander eyes deal to buy TSB (The Times, Helen Cahill) contends that Spanish bank Santander is potentially looking at merging its UK business with Sabadell’s (Sabadell owns TSB). Banco Santander bought the Alliance & Leicester, Abbey National and Bradford & Bingley franchises in the wake of the 2008 financial crisis, which then became Santander UK.

Then in Waymo Wants to Bring Its Robotaxis to New York City (Wall Street Journal, Katherine Blunt) we see that Waymo is keen to operate in the Big Apple but faces a number of legal and other hurdles to its aspirations taking driverless taxis there. This is pretty interesting given the recent push to operate driverless taxis services in the UK. At the moment, vehicles are not allowed to operate without a human at the wheel in New York under state law but Waymo is pushing to change this. If it managed to surmount this, its driverless tech would be the first to drive its streets – and the rewards could be considerable.

The lady in this video is dishing out what looks like the biggest jacket potato I have ever seen 😮…with “a little bit of coleslaw” 🤣! I think I’d be in a food coma after this!!! BTW – important question here – to eat the skin of the jacket potato or not?? I am an EATER of the potato skin. I think the taste is great and believe that a lot of the nutrients are in the skin…

In Trump things, Donald Trump calls for Iran’s ‘unconditional surrender’ (Financial Times, Lauren Fedor, Demetri Sevastopulo and James Shotter) shows that the president’s long on chat and short on action (at the moment anyway) as he made a number of comments that make it look like he’s open to the possibility of joining the Israeli attacks on Iran.

Meanwhile, Howard Lutnick hails Donald Trump’s $5mn investor visa as almost 70,000 apply (Financial Times, Alex Rogers) highlights the excitement of the US commerce secretary over the “success” of the new golden Trump Card, the $5m a go visa scheme, as almost 70,000 people have signed up for it. The commerce department launched a website last week for would-be applicants, on trumpcard.gov, to sign up and provide basic details. Lutnick boasted that “the card will be made of gold…it will be beautiful”. It is designed to appeal to business leaders and companies looking for legal residency in the US for themselves or their employees. Applicants are expected to be vetted by the departments of homeland security, state and commerce.

Donald Trump plans to delay TikTok ban for a third time (Financial Times, Alex Rogers, Demetri Sevastopulo and Hannah Murphy) shows that the successful video-sharing platform has been granted yet another stay of execution for 90 days because Trump has so far failed to deliver a deal that has been approved by China to offload a stake in the platform that will satisfy American security/privacy concerns.

Trump Mobile may mark a golden moment for US upstarts (Financial Times, Lex) follows on from yesterday’s story about the The Trump Organization launching a $500 gold smartphone and shows how this could actually make some serious money because Mobile Virtual Network Operators (MVNOs) aren’t as prevalent in the US as they are in Europe and although ultimately this has made decimated profitability on this side of the Atlantic, there’s lots of money to be made in the meantime! MVNOs – like Sky, Tesco and Lebara over here – lease capacity from network builders such as Vodafone and then go for market share. Why Celebrity Cellular Brands Are Everywhere (Wall Street Journal, Patience Haggin) points out that there have already been a number of celebrity-backed mobile services in the US that become real money-spinners if they get acquired and that although they’re relatively easy to set up, they are difficult to make successful. * SO WHAT? * I said this in yesterday’s podcast but it seems to me like Trump is building some kind of parallel universe (or “Trump-verse”, perhaps?) where his fervent supporters can wear Trump watches and baseball caps, trade his memecoins, communicate on his Truth Social channel and now his golden phone. Is he going to be making a bank next, perhaps? Maybe it will be crypto-based somehow. At the same time as preaching to his masses, he expels dissenters and cosies up to former enemies (e.g. Russia) whilst pushing back former allies (e.g. Canada). Amidst all this, it looks like he is doing his best to make money for himself and his family. I have never seen anything like this before from the leader of a developed country.

Trump threatens to keep 25% tariff on UK steel imports over Port Talbot concerns (The Guardian, Kiran Stacey) shows that the president is pushing for guarantees about the steel

imported by Tata’s Port Talbot factory but UK hopes for steel and pharma deal with US by July (Financial Times, George Parker, Gill Plimmer, David Sheppard and Aime Williams) suggests that the mood is hopeful that any concerns can be ironed out in the near future.

In Reeves things, Rachel Reeves signals UK defence spending will not rise above 2.6% of GDP this parliament (Financial Times, Same Fleming and Chris Giles) highlights some expectation management by the chancellor who said that 2.6% of GDP is as much as the government can do for the duration of this parliament despite pressure from the US for NATO countries to spend more. Reeves considers reversing non-dom tax raid after millionaire exodus (Daily Telegraph, Eir Nolsøe and Lucy Burton) shows that the chancellor is looking at making a U-turn on its non-dom tax stance to stem the outflow of millionaires and Labour’s miscalculation on taxing non-doms (Financial Times, the editorial board) urges her to do this ASAP, although it is now probably too little too late. It observes that the previous system was too lenient, but Labour’s changes pushed it too far in the opposite direction, prompting wealthy non-doms to quit Britain to head to places like the United Arab Emirates, Italy or Switzerland, who are making more efforts to attract them. * SO WHAT? * Much was made of this and you do wonder whether the government’s credibility is going to take a battering with this coming so soon after the winter fuel-payment U-turn as well. Still, that shouldn’t stop the government from admitting a mistake. Estimates by the CEBR suggest that if 25% of non-dom taxpayers leave the UK, the net gain for the Treasury would be zero – anything more than that, and there would be a net loss. It is also worth considering that it might be a good idea sort this out sooner rather than later in order to attract disaffected Americans. Generally speaking, it would be great to attract people that can create wealth and growth for the economy.

Over half of English councils face insolvency under £5bn deficit, MPs warn (The Guardian, Richard Adams) is the sobering view of the Public Accounts Committee (PAC) which told the Treasury and other departments to address spending as a matter of urgency, particularly in the area of special educational needs. The PAC called for the Ministry of Housing, Communities and Local Government, the Treasury and Department for Education to work together on how cumulative deficits will be treated. More broadly, CBI warns of triple whammy on slow economic growth (The Times, Mehreen Khan) highlights the CBI’s concerns about the cumulative effect of rising labour costs, inflation and uncertainty on GDP as it downgraded its forecast for annual growth this year and next.

Then in China nears peak oil demand amid ‘extraordinary’ EV sales (The Times, Emily Gosden) we see that the IEA’s latest report predicts that China will reach peak oil demand within two years as sales of EVs continue to skyrocket. On the other hand, it reckons that American oil demand will rise because of the de-emphasis of EVs under Trump’s administration. Overall, though, it predicts peak global oil demand in 2029.

Amazon boss says AI will mean fewer ‘corporate’ jobs (Financial Times, Rafe Uddin) shows that Amazon’s boss is being up-front about the effect of AI on employee numbers for the next few years. Andy Jassy said in a memo yesterday that the company would be using AI across all operations, but particularly in logistics, in order to further screw down costs. Although this means some jobs will change, overall he said that net-net there will be fewer of them. * SO WHAT? * Although this is a bit gloomy, I think it’s refreshing to hear a Big Tech leader being honest about the effect of AI. So far, many have opted to take the more positive approach and emphasise the improvements in efficiency that AI will bring.

Using AI makes you stupid, researchers find (Daily Telegraph, Matthew Field) offers an interesting take on the effects of using AI – that it will make people less intelligent by restricting the development of critical thinking, memory and language skills, according to the latest research by MIT. Funnily enough, it found that people who relied on ChatGPT to write essays displayed lower brain activity than those who had just gone old school and used their brains! * SO WHAT? * The question here is whether the use of AI is going to cause lasting damage to our brains. The

research expressed concerns that frequent use will lead to “skill atrophy” in tasks like brainstorming and problem-solving! I thought that there were three particularly interesting takeaways from this research – that participants who relied on the chatbots were only able to remember a very small amount of information about their essays, which suggests either poor engagement or that they’d just failed to remember it; that those using search engines only displayed slightly lower levels of brain engagement than those who’d gone on with zero tech involvement; and that essays that had been written with ChatGPT assistance were pretty homogenous.

Then in Investors in Musk’s AI company undeterred by Trump clash (The Times, Katie Prescott) we see that xAI is on the verge of raising $9.3bn in debt and equity, implying that investors are not concerned about the recent collapse in the Musk/Trump bromance. I guess that people are concluding that they both need each other!

In a quick scoot around some of today’s other interesting stories, US retail sales fall by most in 2 years as Trump tariffs distort spending (Financial Times, Myles McCormick and Stephanie Stacey) cites the latest stats from the US Census Bureau which show a concerning drop as consumers continue to react to Trump’s tariffs. * SO WHAT? * This number fell below economists’ expectations and came after a spending spree in April when consumers stocked up on cars and auto parts. Given that consumer spending has been a major driver of the US economy since the pandemic, this is clearly concerning if it becomes an entrenched trend.

For Starbucks, China is a big market with little appeal (Financial Times, Lex) follows on from last week’s story about Starbucks’s turnaround efforts and suggest that it may be time for the coffee giant to de-emphasise its China business. Since opening its first branch there in 1999, it built up a 42% market share at its peak in 2017 but thanks to fierce local competition from the likes of Luckin and Cotti Coffee its market share has cratered to just 14% last year – and this is despite more than doubling its store numbers. At the moment, the number of outlets in China equates to about 20% of its total footprint but they only account for 9% of total revenues and 7% of group operating profit. * SO WHAT? * I definitely think that Starbucks needs to acknowledge this change, so it makes sense to seek out a partner or sell a stake in the China business. McDonald’s and Yum! Brands have done this in the past, so it won’t be alone in having reached this conclusion! The China market seems to be evolving at pace with new drinks and better automation and technology while Starbucks’s domestic market has been stagnating. Given that

Starbucks’s China business could be worth just $6bn versus its market cap of over $100bn, it would not be unreasonable to get rid so that the CEO can concentrate on getting his core offering right in his own backyard.

Takeover talk grips UK banking with Santander, TSB and Metro in frame (The Times, Helen Cahill) does a nice job of rounding up all the recent newsflow on UK banks as we’re now seeing interest in Metro Bank and TSB following last year’s consolidation in the financial sector with Nationwide merging with Virgin Money, Coventry Building Society buying Co-Op Bank, NatWest buying most of Sainsbury’s banking operations and Barclays buying Tesco Bank’s credit cars, loans and savings accounts. Interesting times!

Then in Poundland to shut 68 stores in restructuring that puts 2,000 jobs at risk (The Guardian, Sarah Butler) we see that the inevitable is happening after the discount retailer was sold to Gordon Brothers for a pound last week. 68 shops and two distribution centres are going to shut down with over 2,000 jobs at risk. In addition, 80 more stores look likely to be shut down as the new owners try to turn this business around. As things stand, the owners want to cut store numbers from 800 to no more than 650. It also wants landlords to cut rents to zero on up to 180 stores. The company will also cease online trading, ditch its Perks loyalty app, stop selling frozen goods and reduce its range of chilled foods. This is clearly nasty, but par for the course when a PE firm buys your company for a token amount.

I guess I’m in a musical mood at the moment! Here is a brilliant father-son cover of a classic!

Iran’s regime fights for survival (Financial Times, Najmeh Bozorgmehr and Andrew England) highlights the threat from Israel as being the biggest test yet of Ayatollah Ali Khamenei’s four decade rule as supreme leader. Within a few days, Israel has beheaded its military, attacked its main nuclear sites, crippled its infrastructure and spread fear (and death) among its citizens. Yesterday, it declared “full operational control” of the airspace above Tehran. What comes next is going to be tricky because there’s not much in the way of alternative to the current regime and Khamenei is now facing a choice between two highly unpalatable options – do a deal with the US to shut down its nuclear programme (this amounts to defeat) or keep fighting (which isn’t realistic). How the Israel-Iran war may develop (Financial Times, Gideon Rachman) takes a look at some potential outcomes – that Iran could try to negotiate a solution or it could pursue unconventional means of fighting back (like using chemical weapons, dirty bombs or even crude nuclear weapons) given that it looks like it’ll be unable to win by using conventional methods. Trump has thus far tried to stay out of it but it is believed that only the Americans have the sufficient firepower to destroy the nuclear facility of Fordow. If America got involved, the goal would be to destroy the current regime and put another one in its place. It doesn’t have great form in doing that though…meanwhile, Israel-Iran latest: Oil prices rebound after Trump’s call for Tehran evacuation (Financial Times, George Russell) shows that oil prices rallied in Asian trading after Trump called for an immediate evacuation of Tehran and UK petrol prices poised to rise as Israel-Iran conflict pushes up cost of oil (The Guardian, Julia Kollewe) suggests that all of this will filter through to all of us via higher petrol prices – something that Israel-Iran conflict exposes the true cost of North Sea decline (Daily Telegraph, Matt Oliver) uses to highlight our vulnerability to outside influences if the UK government pushes through with its decision to ban drilling in the North Sea as part of its environmental commitments.

Meanwhile, Donald Trump leaves G7 early as Iran-Israel conflict intensifies (Financial Times, James Politi, Ilya Gridneff, David Sheppard, Steff Chávez and Lauren Fedor) shows that the president left the G7 summit in Canada a day ahead of schedule to sort out America’s response to the Israel-Iran war as a joint statement by world leaders called for a “broader de-escalation” in the Middle East.

Elsewhere, Donald Trump cuts US public spending on health science to lowest level in decade (Financial Times, Patrick Temple-West) cites data from the Treasury department which shows that the Trump administration has slashed government spending on health research to its lowest level since September 2014. This has forced universities to raid their endowment funds and hit companies that sell lab supplies. Fortunately for them, a federal judge in Boston ruled yesterday that the National Institutes of Health’s refusal to pay out grants was illegal. * SO WHAT? * The NIH is the biggest government provider of medical and health research and its withholding of money has hit university research lab budgets across the country very hard. Companies including Thermo Fisher Scientific, 10x Genomics, Standard BioTools and Pacific Biosciences are among the companies hit by this suspension of funding because they supply the labs with various different types of equipment.

Then in Donald Trump signs executive order to implement US-UK trade deal (Financial Times, Aime Williams, David Sheppard and Peter Foster) we see that Trump has moved forward in implementing the trade deal with the UK. British carmakers and aerospace manufacturers should see benefits pretty quickly but steel producers may have to wait longer as details on this are still being hammered out to avoid a 25% global tariff on steel.

Crypto group Tron to go public after US pauses probe into billionaire founder (Financial Times, George Steer and Philip Stafford) highlights two things – the ongoing momentum of crypto and an apparent pick-up in the number of flotations. Digital asset platform Tron is on track to go public in the US via a reverse merger with NASDAQ-listed SRM Entertainment. The new venture will buy and hold the Tron token and Eric Trump looks likely to take a role in the company that will be called Tron Inc. Shares in SRM Entertainment boomed by up to 647% in trading yesterday! * SO WHAT? * This sounds so shady to me! The owner of this company, billionaire Justin Sun, and three of his companies – including Tron – were charged by the SEC in 2023 over allegations that they had sold unregistered securities and manipulated the market. This has now been paused and the fact that Sun is employing members of Trump’s family is super-dodgy, don’t you think?? Sun is the guy that bought that banana duct-taped to a wall for $6.2m last year and then ate it. Maybe he’s hoping that having a Trump involved will give him some kind of immunity…or perhaps I’m wrong and he’s an absolutely top lad…Duncan and I discuss this a bit further in Episode 942 of the podcast 🎙️!

Hedge fund Millennium valued at $14bn in minority stake sale talks (Financial Times, Harriet Agnew) shows that one of the world’s biggest hedge funds is looking to sell a 10-15% minority stake to investors, opening up its ownership for the first time in its 36-year history under founder Izzy Englander. It has over $75bn in assets under management and its flagship fund rose by

15.1% last year and has recorded annualised gains of around 14% since it started. * SO WHAT? * Although this is clearly part of succession-planning, I think that it also shows confidence in investor willingness to get engaged.

In bank news, Metro Bank shares jump more than 18% after takeover approach (The Times, Ben Martin) shows that Metro Bank’s share price shot up by 18.4% – its highest level since March 2023 – on rumours of a takeover bid by British private equity firm Pollen Street Capital. No comment was forthcoming from either side. * SO WHAT? * Metro has had a rough six years since it made a massive accounting blunder – so this explains the excitement! Investors may also be excited by the possibility that it could be a precursor of a merger with specialist lender Shawbrook as Pollen Street owns this as well. A Shawbrook/Metro combo could be a good fit given Shawbrook’s strength in commercial lending and Metro Bank’s desire to bulk up in that area.

Sabadell explores sale of UK high street bank TSB (Financial Times, Simon Foy and Ivan Levingston) shows that Spanish bank Sabadell is looking at offloading its British bank TSB to raise funds that will help it fend off a takeover approach from rival BBVA. It has already contacted potential bidders and was actually prompted to do so having fielded several unsolicited approaches. Interested bidders are to submit formal offers this month.

In a quick scoot around some of today’s other interesting stories, WhatsApp breaks co-founder’s promise with plans to introduce ads (Daily Telegraph, James Warrington) shows that Meta has announced plans to introduce ads on WhatsApp, something that its original founded said would never happen. WhatsApp said yesterday that it would roll out paid advertising to its 3bn monthly users over the next few months. * SO WHAT? * I guess that it’s about time that Meta makes some money from the WhatsApp business it bought back in 2014 for $19bn – but if it gets the balance wrong and annoys its users, there’s a risk that they could just migrate to another platform. Maybe this is why we’ve been seeing so many ads recently emphasising WhatsApp’s end-to-end encryption (and perhaps why it joined that lawsuit with Apple). Duncan and I discuss this move in Episode 942 of the today’s podcast 🎙️!

Elsewhere, Airbus unveils close to $10bn of orders at Paris show overshadowed by Air India disaster (Financial Times, Sylvia Pfeifer) highlights the good fortune of European plane maker Airbus as it unveiled almost $10bn worth of orders on the first day of the biennial Paris Air Show. Boeing had to cut back its activities at the air show following last week’s fatal Air India crash, which has obviously cast a major shadow over the show.

Jaguar Land Rover warns that Trump tariffs will hit profits (The Guardian, Julia Kollewe) cites the carmaker as saying that it will take a hit to profits after it temporarily suspended deliveries to the US. That being said, perhaps the new US-UK deal I mentioned above could help things…

In Entain shares jump 13% as US sports betting powers growth (Financial Times, Mari Novik) we see that shares in the gambling group boomed thanks to the confidence of its US sports betting business. Q2 trading at BetMGM, its US joint venture with MGM Resorts International had largely kept pace with strong growth in Q1. It upgraded its annual forecasts – a nice moment after a troubled period thanks to corporate governance concerns and high executive turnover.

Oxford Street pedestrianisation plan to go ahead, says mayor (Financial Times, Jim Pickard and Josephine Cumbo) shows that Oxford Street is going to be pedestrianised after all after the proposal received “overwhelming public and business support” in a public consultation. Detailed proposals are due to be published later this year but the idea is that it will be pedestrianised from Orchard Street to Great Portland Street. Westminster had previously blocked plans to pedestrianise the street in 2018.

You may remember a while back that I brought you a range of Trump-themed watches in the election run-up so Trump family to launch $500 gold smartphone (Daily Telegraph, Melissa Lawford) seems like a natural extension of this, don’t you think?? The Trump Organization announced plans to sell a gold-coloured smartphone and launch their own mobile network using the president’s name. The move is clearly designed to appeal to his MAGA base! Trump Mobile is being billed as an “all-American service” and the T1 phone is “proudly designed and built in the United States”.

Just two guys by the seaside. This is pretty amazing!

Israel-Iran latest: Four die in missile strikes on Israel as conflict enters fourth day (Financial Times, George Russell) highlights the latest on the conflict as both sides launched attacks while Israel is achieving its goals in Iran — so far (Financial Times, John Sawers) suggests that the Israel’s objectives to hobble Iran’s nuclear programme and cripple oil infrastructure are succeeding at the moment, with the ultimate aim being to topple the current regime. The fallout from Israel’s strikes on Iranian energy sites (Financial Times, Malcolm Moore) takes a look at what was hit (two gas processing facilities), what the impact is so far (it’s causing gas and fuel shortages) and the global implications (increasing concerns about vulnerability of global energy infrastructure). In response, the Iranians could attack Israel’s energy infrastructure and/or close the Strait of Hormuz – a vital trade artery that carries a third of the world’s seaborne oil. The nuclear mountain that haunts Israel (Financial Times, John Paul Rathbone and Charles Clover) highlights a longer-term target (the Fordow nuclear enrichment plant buried 500m beneath a mountain) although Israel managed to destroy Iran’s bigger above-ground enrichment plant at Natanz on Friday and Why Saudi Arabia raised oil output before Israel’s attack on Iran (Financial Times, Tom Wilson and Jamie Smyth) suggests that the recent decision by Opec+ to increase oil production was in response to the White House asking the Saudis to do so in order to help them with three big problems – Iran, Russia and inflation. * SO WHAT? * Ultimately, it looks like these attacks will precipitate a shifting of the geopolitical landscape in the region as the US, China and Russia do not look like they are going to get involved for varying reasons. Without them, the region will be left to its own devices and it’s likely that the Gulf states will lead the way here.

Elsewhere, US sends a shot across the bows of its allies over submarine deal (Financial Times, Demetri Sevastopulo and Nic Fildes) harks back to news last week about the Pentagon reviewing the AUKUS agreement and suggests that this is actually about stinging Australia into spending more on defence from the current 2% of GDP to 3.5%. * SO WHAT? * The AUKUS pact itself is designed to improve capabilities in the Pacific against China and would allow Australia and the

UK to produce a type of submarine called the SSN-Aukus using top secret US technology. The Brits and Aussies are playing down any concerns about this review, but it does send out some uncomfortable signals.

Meanwhile, Remittance crackdown is a tax on the poor (Financial Times, the editorial board) highlights Trump’s proposed increase in the tax on the money that migrants send home – and this includes visa holders and permanent residents. At the moment, the average fee is 6.4% but the president wants to jack this up to almost 10%, which would make it the most expensive G7 country from which to transfer money. * SO WHAT? * Mexico’s president Sheinbaum said that this was a tax on the poor. At the moment, Mexico gets remittances worth about 4% of GDP but other countries in Central America – including Nicaragua, Guatemala and Honduras – are likely to suffer far more because remittances there can make up to about 25% of GDP. Clearly this is yet another move to push immigrants out of the US.

In Mark Carney’s trial by G7 summit as ‘Godzilla’ comes to Canada (Financial Times, Ilya Gridnedd and James Politi) we see that Canada’s new PM will be at the centre of attention at this week’s G7 summit in the Rocky Mountain resort of Kananaskis with over a dozen leaders due to attend. This should be a humdinger given Trump’s actions in office so far and the current geopolitical backdrop. Attendees will no doubt also be eager to know how Carney is going to handle his noisy neighbour – who will be in attendance.

Back home, Rachel Reeves to set out 10-year UK infrastructure plan (Financial Times, George Parker and Gill Plimmer) shows that the chancellor is going to lay out a £725bn decade-long infrastructure plan for Britain. Reeves is expected to prioritise projects that can show quick wins. This comes on the heels of last week’s spending review. It sounds good in theory, but as always there will be rumblings about how it’s all going to be financed…

In consumer trends, American travel demand declines as US consumers cut costs (Financial Times, Stephanie Stacey) cites the latest data from the Transport Security Administration which shows that Americans are reining in holiday plans and delaying bookings until the last minute, which some are interpreting as a sign that growth could be slowing down in America. Prices for airline tickets and hotels have also fallen between April and May and operators have been saying that it’s been getting more difficult to fill rooms. * SO WHAT? * This increasing reticence has been seen across all income levels and is exacerbating the situation for the US tourism industry that’s already struggling with sudden drops in visitor numbers from Canada and Europe.

In the UK, Asking prices for homes show unusual summer fall (The Times, Jack Barnett) shows that home sellers have been cutting asking prices as buyers face their broadest choice of properties in a decade, according to research from Rightmove. This is notable because prices tend to go up at this time of year. On less serious things, Sober karaoke on the rise as Gen Z ditch booze (Daily Telegraph, Daniel Woolfson) highlights interesting trends in karaoke (!) as the CEO of Lucky Voice said that younger people are starting karaoke earlier in the evening and leaving earlier – but they’re also drinking less (or no) alcohol versus previous generations who tend to need large doses of loudmouth soup before they grab a mic. In a survey by Kantar last year, 59% of Gen Z said that they hadn’t drunk any alcohol in the last 12 months – something that has caused alcoholic beverage makers like Diageo a real headache.

Meanwhile, Wall Street juniors should enjoy their moment in the sun (Financial Times, Lex) debates whether AI is going to be the scourge of juniors in finance or whether it’s going to mean that they’ll get exposed to more interesting work earlier on in their careers. It suggests that fewer

juniors will be needed – and that means that the odds of rising to the top improve. * SO WHAT? * I don’t believe that. Working in investment banking and/or private equity etc. is very intense and it’s not for everyone. Some can handle it for a short while and burn out while others are able to go the distance if they can overcome all the political and competitive battles. I think having fewer people going in at the junior level will mean that fewer will end up at the top end.

In corporate trends, ‘Stay below the radar’: corporate America goes quiet after Trump’s return (The Guardian, Callum Jones) highlights the behaviour of a lot of American companies – that they have toed the presidential line because they just don’t know what’s going to happen with this administration, so it’s better to drink the Kool Aid, sit at the back and say nothing. DEI has clearly been one of the issues that has loomed large with Trump’s rein so far and  ‘Magic circle’ ditches Pride logos as Trump attacks DEI (Daily Telegraph, Louis Goss) shows another example of where companies have decided to bend the knee rather than create waves. Ashurst, Baker McKenzie, DLA Piper, Freshfields and Linklaters have all ditched Pride logos on their LinkedIn and X pages this year. Presumably, the reason why Slaughter & May has stuck with it is because its US business is a lot smaller than all of its magic circle rivals.

Then in British manufacturers turn their backs on US as export market (The Times, Robert Lea) we see that British manufacturers are now looking at export destinations outside America given the effect of triple T – Trump Tariff Turmoil – on their business. The US has now fallen out of the top three global regions that UK manufacturers expect to do business with according to a survey of the members of Make UK. Things certainly are looking tricky for UK manufacturers at the moment.

In a quick scoot around some of today’s other interesting stories, Renault chief executive Luca de Meo steps down to lead Kering (Financial Times, Adrienne Klasa, Ian Johnston and Kana Inagaki) shows that Luca de Meo is going to leave Renault – after a five year effort to turn its fortunes around have borne fruit – and join the troubled Kering to turn around its flagging fortunes. Chairman Francoise-Henri Pinault, who has been chair and CEO for two decades, wants to split the two roles and it’s not clear as to whether he’ll stay on as chair. * SO WHAT? * Kering’s share price has cratered by a whopping 70% over the last three years and a turnaround here needs drastic action. They will be putting a lot of hope in this guy being the man to successfully execute that.

Then in Carmakers battle to find supplies of rare earths as China tightens its grip (Financial Times, Camilla Hodgson, Kana Inagaki and Christian Davies) we see that talks between European carmakers and suppliers of magnets are rare earths are intensifying as shortages due to Chinese export restrictions manifest themselves. * SO WHAT? * One German magnet maker said that some car production would be suspended by mid-July unless other sources are found. The shortage of magnets is becoming a problem in the US as well but it seems that Hyundai is sorted as it has inventory levels that will last until at least the end of the year.

Nintendo switches up the rules of console gaming (Financial Times, Lex) is an interesting article that highlights the popularity of the Switch 2, which shows that consoles can still be popular despite the rise of mobile, cloud and high-performance PC gaming. Nintendo wants to sell 15m units of its new console by March next year – but it’s already sold over 3.5m units in its first four days of trading! Funnily enough, there are already shortages. Apparently, Sony is also thought to be cooking up a new portable PlayStation device.

On the high street, TM Lewin returns to the high street as workers go back to offices (The Times, Isabella Fish) shows that TM Lewin, after falling into administration in 2022 for the second time in less than two years, is now looking to open more shops as workers returning to offices need more suits and shirts. It’s targeting openings in London, Manchester and Edinburgh. Prior to the pandemic it had 150 physical shops but had to become online-only since June 2020.

Then in Retail giants ‘face £600m bill’ as new business rates bite (The Times, Isabella Fish) we see that retailers in London’s West End are bracing themselves for a massive increase in business rates when they take effect next April. The new rates will be easier on smaller retail, hospitality and leisure properties but that will be funded by increasing costs to owners of larger commercial properties.

I’m a bit of a sucker for these types of videos as I find them mesmerising! People are amazing, aren’t they?!

More than 240 dead after Air India flight to London crashes (Financial Times, Krishn Kaushik, Chris Kay and Andres Schipani) heralds a terrible tragedy that happened yesterday as a Boeing 787 Dreamliner crashed in Ahmedabad just after take-off. Miraculously, one guy survived but I suspect that casualty numbers will continue to rise as it crashed into a residential area. This is the latest disaster involving a Boeing plane and Air India crash casts shadow over Boeing recovery plans (Financial Times, Sylvia Pfeifer) highlights this. * SO WHAT? * First and foremost, this is an absolute tragedy as so many innocent people lost their lives. However, looking at this from a commercial point of view, this is going to be a nightmare for Boeing which doesn’t seem to be able to catch a break as it seemingly lurches from one disaster to the next. At this moment in time, the cause of the crash is not known, but if this is down to yet another quality control problem this will set the company back years (at the very least). Still, it’s nothing compared to the human suffering right now.

Then in Middle East live: Israel launches major attack on Iran (Financial Times, Peter Wells and George Russell) we see that Israel launched an attack on Iran and it looks like this resulted in the deaths of two of Iran’s top generals – its armed forces chief of staff and the commander of the Islamic Revolutionary Guard Corps. US forces in the region are now readying themselves for an Iranian counterstrike and reiterated support for Israel’s actions. Saudi Arabia, on the other hand, condemned the attack.  It remains to be seen as to what effect this may have on recent diplomatic and trade developments in the region – but it’s not going to be positive…

Over in America, US Senator Alex Padilla wrestled to ground at Los Angeles news conference (Financial Times, Lauren Fedor, Stefania Palma and Steff Chavez) highlights what could well have been a publicity stunt (so it definitely worked!) or just an overenthusiastic reaction to a Democratic senator from California asking a genuine question at a press conference held by the homeland security secretary. Alex Padilla said that he wanted to ask a genuine question but was then “almost immediately forcibly removed from the room” and then forced to the ground and handcuffed by the FBI. The FBI said that Padilla was removed by Secret Service agents “when he became disruptive while formal remarks were being delivered”. Meanwhile, Judge orders Trump to return control of California’s National Guard to state (Financial Times, Stefania Palma) shows that a federal judge has now told Trump that he must cede control of California’s National Guard to the state’s governor because his actions were “illegal – both exceeding the scope of his statutory authority and violating the Tenth Amendment to the United States Constitution”. This is clearly a victory for the embattled Democratic governor of California, Gavin Newsom, but he described it as “a win for all Americans”. The government is, unsurprisingly, appealing the ruling.

In other developments, State department planning to lay off hundreds of US-based staff (Financial Times, Guy Chazan and Demetri Sevastopulo) highlights imminent headcount reductions as part of a broader reorganisation initiated by secretary of state Marco Rubio. The foreign service labour union, AFSA, said that this comes at a time when the department’s workforce was already stretched very thinly. Some are saying that about 1,600 US-based jobs could be lost in the shake-up. It’s thought that 132 offices could be closed, some of which will have focused on human rights and the promotion of democracy. The “Trumpisation” of America continues…

Trump ‘may have to force’ Fed on interest rates (Daily Telegraph, Melissa Lawford) shows that

the president is back on the offensive with the Fed once more, branding the Fed chief a “numbskull” and saying that he should cut interest rates by one whole percentage point! Trump blamed him for keeping America’s debt costs high. He had previously threatened to sack Powell in April, but then the markets freaked out and he backed down. I don’t know how Trump is going to be able to follow through on his threat of “forcing” Powell to bend to his will. At the moment, it just sounds like sabre-rattling…

In Donald Trump ready to enact key parts of US-UK trade deal within days (Financial Trimes, Peter Foster, George Parker and Gill Plimmer) we see that the much-hyped US-UK trade deal is getting ever closer with both sides now hammering out details about the part of the deal that will deliver zero-tariff access to the US for UK steelmakers. Some are saying that a deal could be signed by the end of this week.

It can’t come soon enough given British exports to US suffer biggest fall on record (The Times, Mehreen Khan) cites the latest data from the ONS which shows that our exports to the US suffered badly in the wake of Trump’s “liberation day” tariffs. Not only that, but UK economy suffers worst monthly contraction since 2023 (Financial Times, Valentina Romei and Jim Pickard) cites the latest figures which highlight a weaker-than-expected fall in monthly GDP. On the plus side, FTSE 100 closes at record high as Trump’s tariffs shake faith in US (Daily Telegraph, Chris Price) shows that we’re benefitting from investors shifting their money away from the US to the UK as the instability and unpredictability of the US under Trump continues to freak them out. Also, Worker supply increases at fastest rate since pandemic (The Times, Jack Barnett) cites the latest data from REC and KPMG which shows that the supply of available workers increased to its highest level since December 2020, which means that wage growth is more likely to slow down, which in turn could make it easier for the Bank of England to justify cutting interest rates.

UK financial regulators should copy Singapore model, say peers (Financial Times, Martin Arnold) is an interesting article which suggests a possible solution to the problem of the British company exodus from the LSE – that we should be more like Singapore and be willing to take on more risk, be more supportive of economic growth and become more welcoming to businesses. So said the report from the House of Lords Financial Regulation Committee. The group concluded that the FCA and PRA have put in place “unnecessary frictions” since the 2008 banking crisis that clip the wings of growth and innovation. Singapore punches way above its weight when it comes to attracting multinationals – to the extend that it now has the world’s fourth highest GDP per capita, behind Luxembourg, Ireland and Switzerland. * SO WHAT? * Clearly something needs to be done otherwise the LSE is just going to suffer the death of a thousand cuts.

Then in Crypto influencer Anthony Pompliano set to launch bitcoin-buying vehicle (Financial Times, Antoine Gara and George Steer) we see that the high profile crypto influencer is about to become the CEO of the weirdly-named ProCapBTC in a SPAC-backed acquisition that will lead to a subsequent raising of $750m to spend on bitcoin. Pompliano has 1.7m followers on X. * SO WHAT? * You can’t blame anyone for wanting to jump on this crypto bandwagon at the moment, particularly given how well Circle’s IPO went recently, TMTG’s increasing involvement and the imminent IPOs of Bullish and Gemini. Momentum continues to build…

In consumer trends news, Falling alcohol sales have Big Booze over a barrel (Financial Times, Lex) shows that alcoholic drinks makers are having a very rough time at the moment particularly as younger people in large parts of the developed world are drinking less. Along with rising indifference, weight-loss drugs and the legalisation of cannabis in the US are all factors. Evolving tastes have had a particular impact on companies more exposed to wine and spirits – and Diageo is a good example of that, given that its share price has more than halved since the beginning of 2022. It’s worse for Jack Daniel’s maker Brown-Forman, though, as its share prices has lost two-thirds of its value since its 2020 peak! On the other hand, research consultancy IWSR reckons that developing markets like India, Brazil, Mexico and South Africa are expected to drive sales over the next decade and AB InBev, which owns the Stella Artois and Budweiser brands (among many others!) and is more exposed to Central and South America, has seen its share rise by about 40% so far this year. This is in stark contrast to Molson Coors, for instance, which is more US-focused and seen a 10% fall in its share price. * SO WHAT? * This is not great news, but at least there are some growth areas to be had. In addition to this, low or no-alcoholic beverages are really gaining traction. Will we see another reshuffling of brands in response to this perhaps??

On the food side of things, Tuna, beans, Spam: Trump’s tariffs threaten the canned foods millions rely on to survive (The Guardian, Victoria Namkung) shows that Trump’s tariffs on steel and aluminium are having an effect on other areas. In this case, prices for tinned goods could rise by 15% – and that’s going to have a particularly acute impact on poorer households. American can makers import almost 80% of tin mill steel because American steelmakers shut down domestic facilities over the years, leaving just three domestic production lines. CEOs from companies such as Del Monte, Goya Foods and Hormel Foods are appealing for Trump to exempt mill steel and aluminium from tariffs.

In retail news, Fake McDonald’s lobbies Vladimir Putin to block return of western companies (Financial Times, Courtney Weaver and Max Seddon) is an interesting article which shows that companies who have taken over the businesses of western brands after the invasion of Ukraine are keen to hang on to what they’ve built up since then. This could be a reaction to recent calls by Putin to put together guidelines for the return of foreign companies or perhaps it’s just because they’ve made so much money over the last few years, they don’t want the “good times” to end! Western sanctions have made Russians less reliant on exports and rising wages, driven by higher military wages, have powered domestic demand and private consumption. * SO WHAT? * I certainly don’t blame these companies for wanting to protect what they’ve built up! I’d also suggest that many western companies would be mad to return to Russia anyway, particularly if Putin is in power because you just don’t know what he’s going to do. It’d be interesting to know what Russians think of these offerings compared to the Western ones they had before…

Meanwhile, Trouble is brewing in China for the West’s retail giants (Daily Telegraph, Hans van Leeuwen) shows that, despite Trump boasting about a new trade deal with China, Chinese consumers might have other ideas as companies including Estee Lauder, Diageo and Unilever have all remarked on Chinese consumer caution on spending and the negative impact that this

has had on operations there. * SO WHAT? * The fact of the matter is that Chinese consumers are still being very cautious and until they start to get any confidence back EVERYONE’s going to suffer. The real estate market continues to be very weak and until we see sustained recovery here I think that consumer confidence is going to remain at depressed levels.

In UK retailing news, Upmarket Finest range helps lift Tesco sales amid UK ‘home dining boom’ (The Guardian, Joanna Partridge) shows that sales of its own brand jumped by 18% in Q1, which helped to lift overall sales in the quarter and the UK’s biggest supermarket also managed to grow its market share over the period as well. * SO WHAT? * Some analysts are saying that the success of the “Finest” range is down to customers going to restaurants less and eating more at home in order to save those pennies. So far so good in terms of keeping the German discounters at bay!

Meanwhile, Activist investor builds stake in WH Smith to boost share price (The Times, Isabella Fish) highlights the acquisition by activist investor Palliser Capital of a 5% stake in the retailer that recently sold off its high street business to a private equity firm. It reckons that the current share price is too low and has underperformed the broader travel, leisure and retail sectors. * SO WHAT? * This sounds like a reasonable move, but you do wonder what Palliser can do to improve the situation. WH Smith has thankfully jettisoned the millstone around its neck and it has undergone a lot of overhauls over the years. I personally don’t think you can mess too much with the management as yet because, TBH, they did what they needed to do with the high street business and they probably need a bit of time to recalibrate. The last thing they need at the moment is some jumped-up investor poking their nose in. Who knows, maybe they’re just in it for the ride…

Staying on the high street, Poundland sold for £1 with dozens of store closures expected (The Guardian, Joanna Partridge) shows that Poundland has been bought by US investment firm Gordon Brothers for a token amount. Poundland currently has over 800 outlets in the UK and around 16,000 employees. Gordon Brothers said it would invest up to £80m in Poundland to facilitate a turnaround. At the moment it looks like it’s going to slash the number of stores and renegotiate with landlords in order to pay lower rent. * SO WHAT? * Given the backdrop of higher prices and squeezed household budgets, you would have thought that discount stores like this would make a killing. Unfortunately for them, supermarkets such as Tesco, Aldi and Lidl have cottoned on to this and adjusted their pricing strategies accordingly. Given that Poundland’s profit margins were thin anyway before the higher NICs and living wage came in, this has been a tough year. I personally don’t think that having low prices alone is enough for a retailer to survive any more. Maybe it’s time for Poundland – like Asda – to find its voice again so that it can have its own identity and be heard among everyone else! I’d start off by changing the name for instance – I think it’s limiting (I mean, how much can you ACTUALLY get for a pound these days??) and boring. I think that Poundland will always sound cheap – in all senses of the word – and so will never be able to break out of its box. At least a different name would be a start and perhaps give it more flexibility. Major surgery is required here IMO.

In BYD launches cheapest UK model in bid to overtake Tesla as biggest electric carmaker (The Guardian, Jasper Jolly) we see that the Chinese car maker has launched its cheapest model, the Dolphin Surf, in the UK with a starting price of £18,650. This price point puts it among the cheapest vehicles available to today in the UK. * SO WHAT? * This should have non-Chinese makers quaking in their boots, particularly because you know that BYD’s still got a ton of margin it could lop off. The equivalent model in China costs just £6,000, for instance! Given that the UK has not imposed tariffs on Chinese car imports, we are a major target for Chinese car manufacturers now.

Then in Chinese carmaker Xpeng develops advanced chips for VW cars (Financial Times, Gloria Li and Edward White) we see that Xpeng claims to have made chips for autonomous driving that are better than Nvidia’s equivalent products and it reckons it will be able to win over VW and others as customers. It’s planning to integrate its proprietary Turing AI chip into some of the models that VW is launching in China next year. VW has a 5% stake in Xpeng. * SO WHAT? * Wow! This sounds impressive and shows just how far Chinese chip design has come in trying to

catch up with foreign-made semiconductors. Xpeng is among a group of Chinese companies – including Nio, Huawei, Horizon Robotics and Black Sesame Technologies – vying for supremacy in automotive chip design and they are making some serious advances.

French forced to rescue British charging company as drivers shun EVs (Daily Telegraph, Michael Bow) highlights French energy giant EDF’s purchase of UK car charging company Pod Point which operates in 5,600 fuelling stations. It is the third biggest charging group in the UK. * SO WHAT? * The company floated in 2021 at a £350m valuation but its share price has evaporated by 94% since then! I’ve always said that I think being a standalone charging company is a dangerous business to be in because rapidly advancing battery technology will consign range anxiety to history – but even more importantly, the demand for EVs has been poor. Maybe EDF has snapped up a bargain here that it will be able to take full advantage of as more people buy EVs over the coming years.

In a quick scoot around some of today’s other interesting stories, Will Starbucks’ big bet on its baristas pay off? (Financial Times, Gregory Meyer) highlights the latest efforts by Starbucks’s CEO to turnaround the company’s fortunes – Brian Niccol said he’s going to hire more baristas in a bid to make Starbucks a friendlier environment once more so that it will attract more customers. It will also use algos to work out better efficiencies for mobile, drive-through and counter orders. The new “Green Apron Service” is expected to roll out in North America by the end of the summer. Starbucks should give up China for a mug’s game (Financial Times, Lex) goes further and says that it should sell all or part of its struggling China business to someone who has the right expertise and can take it forward in an increasingly competitive market. * SO WHAT? * Extra staff sounds like a nice idea but analysts are worried about how much this is going to cost. I think that the China disposal idea is good though as competition from domestic challengers like Luckin Coffee is getting fiercer. FWIW, although I think that Starbucks’s coffee it OK I find ordering there a major faff and it takes ages. If it can shorten the gap between ordering and picking up your drink I think that will help enormously – as will simplifying the menu (IMO).

Barbie-maker Mattel partners with OpenAI to make AI child’s play (Financial Times, Gregory Meyer and Rafe Uddin) highlights an interesting venture as the two companies announced a “strategic collaboration” that will “bring the magic of AI to age-appropriate play experiences”.

No specific examples were given but the companies said that “safety, privacy and security” would be paramount. * SO WHAT? * I think it’s good that Mattel has put its towel on the sun-lounger, so to speak, but we’ll have to see what they come up with! They are expected to announce their first product later this year.

Meta invests $15bn in Scale AI, doubling start-up’s valuation (Financial Times, George Hammond, Melissa Heikkila and Cristina Criddle) gives us a bit more detail on the Meta/Scale AI deal in terms of who’s doing what. Thus far, the focus of Scale’s business has been the labelling of data, a manual process where images and text are correctly labelled and categorised before they are used to train AI models. * SO WHAT? * I think that this is actually a very canny move, particularly as content creators continue to push for more accountability of AI models using their material. Having Scale on board will be very useful for Meta IMO.

Then in Shares of fintech Chime soar in market debut (Financial Times, George Steer and Akila Quinio) we see that the flotation of mobile payments group Chime went really well on its NYSE debut yesterday. It opened up 59% and raised $864m. It really does look like America’s IPO market is gathering momentum…

The woman on this video is hilarious IMO! What do you think?? Great deadpan delivery!

US inflation rose less than expected to 2.4% in May (Financial Times, Claire Jones) highlights May’s inflation figure, which would suggest that Trump’s tariffs are thus far not putting as much upward pressure on prices by as much as had previously been feared – although some observers say that tariffs can take at least three months to have an impact.

In trade news, Donald Trump says US-China deal ‘done’ as two sides restore trade war truce (Financial Times, Peter Foster, Demetri Sevastopulo and Joe Leahy) shows that the president posted that a US-China trade deal had been “done” on his Truth Social network yesterday after two days of negotiations in London. Trump’s ‘done deal’ with China gets cautious welcome on Wall Street (The Times, Ben Martin, Alison Dawber and Mehreen Khan) saw that markets took this with a pinch of salt as they initially rallied on the news only to shed the gains when it turned out that Trump would still impose a 55% tariff on imports from China while there would be a 10% tariff going the other way.

In defence news, Pentagon launches review of Aukus nuclear submarine deal (Financial Times, Demetri Sevastopulo) shows that the security pact between Australia, the UK and the US made in 2021 is now up in the air as The Pentagon is now reviewing it. It’s looking into whether the US should ditch the project – and the investigation is being led by an official who has previously been sceptical about it. London and Canberra are now understandably nervous.

Is there a tearful reunion brewing? ‘They went too far’: Musk says he regrets some of his posts about Trump (The Guardian, Jasper Jolly and Maya Yang) highlights contrition from Musk after a personal phonecall from him to the president on Monday night – and this came after JD Vance and the White House chief of staff had a chat with Musk on Friday. Trump said “I thought it was very nice he did that” and added that he could potentially reconcile with Musk. Tesla’s share price rallied a bit on this but it’s not all sunshine and rainbows just yet. I think that this is just a case of both people realising that they do actually need each other.

Meanwhile, Trump’s influence on the masses continues in ICE Raids Have Sent Latino Shoppers Into Hiding and Big Brands Are Hurting (Wall Street Journal, Laura Cooper, Arian Campo-Flores and Enrique Pérez de la Rosa) which highlights the fear he has engendered among Hispanic consumers. This demographic is estimated to have an annual $2.1tn in spending power but the sight of mass deportations have prompted many Latinos – both legal and illegal – to change their spending habits. Many are keeping a lower profile – and that involves spending less. Some are even sending out their US-born children to buy essentials. Job losses in industries like construction are rising and this means less money in their pockets while everyone’s household finances are being squeezed by inflation! * SO WHAT? * This squeeze is hitting America hard, particularly in Southern states with large Hispanic populations and companies like Coca-Cola, Colgate-Palmolive, Modelo brewer Constellation Brands and various restaurant chains have highlighted a notable drop in Hispanic spending. Even the CEO of JD Sports said that “We have seen a huge decline in traffic” as it owns retail chain Shoe Palace which has outlets in 12 states and targets Latino customers. One guy in the article – who is a naturalised citizen – said that he’s stopped going out to nice restaurants with his wife and he carries copies of his passport and citizenship paperwork all the time in case he’s challenged. What an absolutely tragic state of affairs. 

Elsewhere, EU targets Chinese banks over Russian trade links (Financial Times, Henry Foy, Alice Hancock and Andy Bounds) shows that the EU is gearing up to slap sanctions on two small regional Chinese banks for allegedly facilitating banned trade with Russia by using crypto transactions. This could make things awkward ahead of the EU’s summit with President Xi Jinping in Beijing next month.

Back home, Rachel Reeves unveils 3% NHS spending boost but cuts other budgets (Financial Times, George Parker and Sam Fleming) looks at yesterday’s unveiling of the government’s spending review, which the chancellor described as being more investment-focused rather than being austerity-heavy. The IFS think-tank noted that government spending outlined in the review was heavily front-loaded for its first two years in parliament. Tax rises loom as Rachel Reeves gambles on spending boost (The Times, Steven Swinford, Chris Smyth and Oliver Wright) highlights concerns that the spending will necessitate more tax increases to fund it all because of the strain on public finances and Fact check: how accurate are Rachel Reeves’s spending figures? (The Times, Steven Swinford, Chris Smyth and Oliver Wright) highlights scepticism on Reeves’s numbers. Meanwhile, Spending review 2025: winners and losers (Financial Times, Laura Hughes and Amy Borrett) shows that winners will include the NHS – which will get a 3% real-terms increase in everyday spending; defence – which will see an increase in funding via a new government target of spending 2.6% of GDP on this area by April 2027; schools – whose budget in England will increase by an average of 0.4% per year between 2025-26 and 2028-29;  consultants – who will see the government delay plans to halve spending on consultancies by three years; and housing – which will see an extra £39bn poured into affordable housing over the next ten years. Areas that will lose out include the Home Office, which will see spending fall; the Foreign Office, which will get less money and see big cuts to the overseas aid budget; the environment, as DEFRA’s capital budget is set to fall; transport, where the Department for Transport will see a drop in spending by around 5%, including cuts in spending on the HS2 project; and then council taxpayers, who are going to have to pay higher bills to finance the planned increase in “police spending power”.

In the world of energy, World Bank lifts ban on funding nuclear energy in boost to industry (Financial Times, Jamie Smyth and Claire Jones) shows that the World Bank announced a major shift in policy and is now allowing the financing of nuclear energy in a move designed to boost development of the low-emissions tech. * SO WHAT? * The no-nuclear policy has been in place for decades, so this is a significant change in stance and reflects the world’s current mood music as demand for electricity skyrockets.

Staying with nuclear, US moves to repeal Biden-era limits on pollution from power plants (Financial Times, Myles McCormick) shows that Trump’s tearing down of Biden-era green policies is proceeding apace as the US Environmental Protection Agency (EPA) is looking at repealing regulations governing carbon dioxide emissions and other pollutants as part of Trump’s “energy dominance” agenda. Meanwhile, Europe’s nuclear fusion potential draws record investment round (Financial Times, Tom Wilson and Tim Bradshaw) highlights a chunky €130m of funding secured by German fusion energy tech company Proxima Fusion as excitement continues to build about the potential of creating oodles of zero emissions power while closer to home, Even expensive nuclear power is cheaper than it looks (Financial Times, Lex) argues that even though many will grumble about the cost of the UK government’s decision to keep going with the Sizewell C nuclear project it still makes sense. The alternative is to let it UK nuclear ambitions to wither and die, which will leave us with an increasingly difficult situation as the demand for power continues to get greater.

Then in Oil prices surge on fears of escalation between US and Iran (Financial Times, Steff Chávez, Jamie Smyth, George Steer and Andrew England) we see that oil prices bumped up sharply yesterday after the Pentagon gave authorisation for dependents of service members in some parts of the Middle East to leave the region, reflecting concerns that tensions between the US and Iran could escalate. Oil prices increased by around 5% yesterday but then pulled back slightly today.

Oracle shares jump after upbeat forecast for cloud division (Financial Times, Rafe Uddin) shows that the database company saw its share price rise by almost 8% yesterday thanks to an upbeat forecast pertaining to its pipeline of cloud computing contracts that look set to more than double next year! It said that its cloud infrastructure business was projected to grow by over 70% in the next fiscal year! The company aims to be the biggest builder and operator of cloud infrastructure data centres. * SO WHAT? * This is particularly impressive because the company had been a relatively late entrant to the cloud computing market, but it has recently seen a major uptick in demand for data centre infrastructure. Oracle is definitely leaning into rising demand in this area. Amazon, Alphabet, Meta and Microsoft have, combined, committed over £300bn on capex this year – and most of that has been on data centre infrastructure, so this is clearly a good place to be! Earlier this year, it became a partner in OpenAI and Softbank’s $500bn Stargate project and CEO Larry Ellison said that if Stargate works out as planned, then growth could be stellar.

Meta plans big bet on AI’s secret ingredient: human brains (Financial Times, Lex) builds on the story I mentioned yesterday about Meta buying 49% of Scale AI and cites a very interesting warning that OpenAI co-founder Ilya Sutskever made that we are heading towards “peak data” in the same way that the planet is reaching “peak oil”. Scale AI’s founder said that freely available data has now largely been absorbed and that the next phase of AI’s development is going to depend on humans generating more quality content! Meta is buying not only Scale AI – but the human brains behind it, and if you look in the context of spending $15bn on something

that will unlock access to a market potentially worth trillions of dollars then it will have been money well spent!

In WhatsApp joins legal action against UK demand for Apple ‘back door’ (Financial Times, Tim Bradshaw) we see that WhatsApp has just joined in the legal challenge against the UK government’s demand to force Apple to provide a “back door” to its security systems. The government will say that this is needed for security reasons while WhatsApp and Apple will argue that this sets a dangerous precedent and breach rights to privacy. WhatsApp has previously threatened to withdraw its service from the UK if its encryption was called into question.

Then in Disney and Universal sue AI image creator Midjourney, alleging copyright infringement (The Guardian, Blake Montgomery) we see that two media giants are taking on Midjourney in the federal court in Los Angeles, alleging that the latter’s AI-powered image generator is a “bottomless pit of plagiarism” for its alleged reworkings of its best-known characters. * SO WHAT? * This just represents further advances in content creators’ push-back against AI models’ untrammelled consumption of their output. I think that the more of this kind of action we see, the more some kind of agreement needs to be reached between creators and AI innovators. As I’ve said before, the likes of Spotify and others have managed to bring together record companies and artists on their platform by agreeing to pay royalties on a regularly negotiated basis. Will this be coming to other types of content?

Apollo delays hiring junior bankers after pressure from Jamie Dimon (Financial Times, Sujeet Indap and Ortenca Aliaj) highlights an interesting development in the whole investment banks vs private equity spat (remember that investment banks are getting increasingly p!ssed off with private equity firms creaming off their best recruits after having spent time and money training them). Apollo Global Management has acknowledged this as a phenomenon and has decided to hold off recruiting for junior associates until next year. How jolly decent of them!

Then in High Court tells insurers to pay AerCap $1bn for jets stuck in Russia (The Times, Alex Ralph) we see that the world’s biggest commercial aircraft owner will be allowed to claim over $1bn from insurers including AIG, Lloyd’s of London and Chubb to cover the losses for the 147 aircraft and 16 standalone engines that became trapped in Russia in the wake of the February 2022 invasion of Ukraine. * SO WHAT? * The aircraft in question were under lease agreements

with AerCap by Russian carriers. This will bring a welcome end to a very complicated case. Legal experts had said in the past that insurance policies were likely to cover the stranded aircraft – but claims for aircraft destroyed in the first Gulf War had taken 12 years to resolve! This has “only” taken three years in comparison…

Monzo’s customers aren’t yet ready to put a ring on it (Financial Times, Lex) follows on from last week’s strong results from the bank and highlights an important point that it might want to overcome to be taken more seriously – only 56% of Monzo account holders actually use their cards every week because they are still with their “main” banks. The proportion of weekly users has, in fact, been falling over the last five years rather than rising! At least the proportion of customers who use it as their “main” bank account has risen from 23% a year ago to around a third today. This is certainly something that the bank needs to continue to address.

In a quick scoot around some of today’s other interesting stories, Tesla drivers in France sue over Elon Musk’s political antics (Financial Times, Ian Johnston) highlights a case being brought in France by about 10 customers who are suing Tesla to terminate the leases on their vehicles due to Musk’s political activities. His behaviour has prompted rising hostility against the brand and customers say that this has prevented them from “enjoying” their vehicles. * SO WHAT? * The lawsuit is still in the early stages and a decision will have to be made as to whether to take this further. Paris law firm GKA says that other Tesla owners are welcome to join the existing claimants. The suit also maintains that customers will face higher insurance costs (higher risk of vandalism) and steeper depreciation (because no-one wants to buy the vehicles). This will be

closely followed and I would suggest that if customers win this, the whole thing will create an important – and potentially very damaging – precedent and inspiration to Tesla owners worldwide.

Zara owner sees slow start to summer (The Times, Jessica Newman) shows that Zara’s owner, Inditex, is suffering from waning consumer confidence as it reported worse-than-expected Q1 revenues and a sluggish start to the summer season. * SO WHAT? * Inditex is a serial out-performer, so this is disappointing. However, there’s still time to prove that the current weakness is just a blip!

I haven’t featured this guy on here for a bit, but I think that his budget version of beef Wellington is brilliant!

2020s on course to be weakest decade for global economy since 1960s, says World Bank (The Guardian, Heather Stewart) is the rather gloomy headline from today’s Guardian and cites the World Bank’s forecast downgrades for GDP growth from its twice-yearly Global Economics Prospects report. It cut its forecast for global GDP growth this year from 2.7% down to 2.3% and urged governments to end trade tensions and for emerging market and developing economies to rebuild their public finances. It is interesting to note that the Bank’s predictions are based on the “liberation day” tariff 90-day pause not being reimposed – so if they are, brace yourselves for more downgrades!

Meanwhile, Los Angeles mayor puts parts of city under curfew in push to quell protests (Financial Times, Guy Chazan, Christopher Grimes and Lauren Fedor) highlights the latest developments in the LA protests – that mayor Karen Bass imposed a curfew for the downtown area “to stop the vandalism, to stop the looting”. The Trump-Newsom fight continued with California governor Newsom remarking that “What we’re witnessing is not law enforcement, it’s authoritarianism” whereas Trump described it as “a full-blown assault on peace, on public order and on national sovereignty, carried out by rioters bearing foreign flags”.

In trade news, US and China agree to framework deal to restore trade war truce (Financial Times, Peter Foster, Demetri Sevastopulo and Joe Leahy) shows that the two superpowers have apparently agreed to some kind of framework that they can both work with in order to move forward with the trade truce. It is just talks, though, so let’s just see how this pans out.

In oil news, US oil output set for first annual drop since pandemic (Financial Times, Kristina Shevory and Jamie Smyth) cites forecasts from the Energy Information Administration which thinks that US oil production will weaken next year, shedding an uncertain light on Trump’s desire for “energy dominance”. It said that this would be a result of falling oil prices because there’s less incentive for drillers to drill when the oil price isn’t very attractive. The US oil benchmark, West Texas Intermediate (aka “WTI”), fell below $65 a barrel yesterday – that’s a full 17% fall since its highest point this year – and is below the price that shale drillers need just to break even.

There was some really interesting news from the UK yesterday! Rolls-Royce to build UK’s first small nuclear power stations (The Times, Robert Lea) shows that Rolls-Royce was finally

selected by the government yesterday to build three new Small Modular Reactors (SMRs) to power three million homes. * SO WHAT? * This has been a long time coming and Rolls-Royce says that this will result in thousands of jobs. Its SMR design has already been selected by the Czech Republic and it’s also in the mix in other international markets to ply its tech. Onwards!

Meanwhile, Reeves places £39bn affordable homes plan at centre of spending review (Financial Times, George Parker, Sam Fleming and Josephine Cumbo) highlights government plans to make a £39bn affordable housing plan at the centre of her UK spending review, due to be announced today. * SO WHAT? * The review will be a key moment for this Labour government as negotiations have been going on behind the scenes between government ministers that will now set the scene for the next few years. Speculation is rife, though, about Reeves having to finance all this by raising taxes in the autumn because she will be promising £113bn of extra spending over the course of this parliament that will be of particular benefit to “towns and cities outside London and the south-east”. Mind you, Reeves’s decision last year to relax her borrowing rules to allow for extra infrastructure investment may provide her with some latitude. Full details of the capital spending plan will be laid out next week.

Then in UK to launch trials of driverless taxi services next spring (Financial Times, Tim Bradshaw, Jim Pickard and Kana Inagaki) we see that UK transport secretary Heidi Alexander announced plans to bring a small number of driverless taxis to the UK in an effort to catch up with advances in the US and China. Commercial trials of fully driverless taxi services will start next spring, which is a year earlier than expected. Supposedly the autonomous vehicle industry could generate 38,000 new jobs and boost the UK economy by £42bn by 2035 (although I’m assuming that none of those jobs will be for drivers!). US ride-hailer Uber and London-based Wayve are going to work together to operate one of the first fully driverless taxi services in London next year! * SO WHAT? * I’d argue that if driverless works in London, it’ll work anywhere. I think that success will depend not only on superior tech – it will also rely on price. I think it’ll have to be a lot cheaper than alternatives to really catch on because after perhaps the initial novelty, people might just think they’d rather a human at the wheel anyway. I think that there are still issues of trust, safety and liability to hammer out…

In consumer trends news, Britons ‘hoarding cash amid economic uncertainty and fear of outages’ (The Guardian, Phillip Inman) highlights comments made by the Bank of England’s chief cashier, Victoria Cleland, yesterday at a speech at the Cash in the UK conference that we’re hoarding physical cash in response to economic uncertainty and as a buffer for potential banking system outages. * SO WHAT? * This type of behaviour was common during Covid and the cost-of-living crises. Interestingly, the number of banknotes in circulation has boomed by 23% since before the pandemic despite the ongoing fall in cash usage. Recent cyberattacks affecting UK retailers including M&S have shaken consumer confidence in electronic transactions and it is also worth noting that that consumers in Spain and Portugal turned to cash during the recent power outages.

Meanwhile, Share of high loan-to-value mortgages rises to highest since 2008 (The Times, Jack Barnett) cites Bank of England data which shows that home loans worth over 90% of a property’s value account for 6.7% of all mortgages in the UK in Q1 of the year, a rise from the previous 6.3% over the previous quarter. Somewhat worryingly, the last time such high loan-to-value (LTV) loans reached similar levels was in Q2 of 2008 at the height of the global financial crisis! Some of this rise may be attributed to the recent relaxation of affordability tests by the

major lenders. Another interesting data release, this time from financial industry lobby group UK Finance, showed that the number of mortgages given to borrowers over the age of 55 increased by a chunky 33.5%! * SO WHAT? * We are currently in quite finely balanced economic circumstances so it feels like if there are any major shocks there could be quite extreme knee-jerk reactions. Having said that, we’ve seen so many extreme macroeconomic events recently, that perhaps investors will be more inured to such shocks!

In employment news, Britain losing jobs at fastest rate since Covid (Daily Telegraph, Eir Nolsoe) cites the latest data from the ONS which shows that the number of people in employment between April and May has fallen at its sharpest rate since the pandemic thanks to the sudden introduction of higher NICs and minimum wage. The unemployment rate hit 4.6% in the three months to April, up from 4.4%. On the plus side, the number of jobs in the public sector reached their highest level in 14 years! Reeves will hope weaker wage growth enables more interest rate cuts (The Guardian, Heather Stewart) shows that this might have implications on interest rates as the governor of the Bank of England recently said that the state of the labour market and wage growth will be major factors affecting any further interest rate cuts.

In a quick scoot around some of today’s other interesting stories, Meta plans to invest $15bn in Scale AI in bid to catch up to rivals (Financial Times, George Hammond, Cristina Criddle and Melissa Heikkila) highlights Meta’s plans to invest about $15bn in the data-labelling start-up Scale AI and hire most of their staff in a huge deal! Meta would give Meta a 49% stake in the company and value Scale AI at about $28bn. Scale AI manually labels data that’s used to train advanced AI models to ensure its accuracy. * SO WHAT? * This is a bid to make up ground lost to rivals but it sounds quite naughty to me because it looks like a takeover in all but name! Doing it this way means it doesn’t have to disrupt business or jump through a ton of regulatory hoops. It reminds me a lot of when Google hired the founders and a lot of staff from chatbot maker CharacterAI and Microsoft’s “investment” in Inflection and Amazon’s in Adept. Are we going to continue to see this kind of dodgy arrangement? Or are regulators going to clamp down on it??

Snap to launch ‘Specs’ smart glasses to revive challenge to Meta and Apple (Financial Times, Tim Bradshaw) highlights the latest attempt by the social media platform to launch some proprietary hardware as it’s having yet another go at launching smart eyewear. By doing so, it’s throwing its hat in the ring with Meta (and its partnership with Ray-Ban maker Essilor-Luxottica), OpenAI (via its recent acquisition of John Ive’s hardware start-up) and Apple (via its Vision Pro tech) to create the next big must-have wearables. The new device is called “Specs” and combines AI image recognition and the ability to display high-def 3D images. The company did not, however, release many details – including price! It did say, however, that the device will be able to operate as a stand-alone device that does not need to be tethered to anything else. It’ll be interesting to see how this device turns out…

In Peter Thiel-backed crypto group Bullish files for Wall Street IPO (Financial Times, Antoine Gara, Oliver Barnes and George Steer) we see that crypto exchange Bullish moved closer to a flotation by submitting paperwork with the SEC as it clearly wants to lean into Trump’s crypto-friendly administration. Bullish had previously tried to do an IPO via a SPAC deal in 2021 but it

fell through. * SO WHAT? * Given bitcoin’s storming through the $100,000 threshold, last week’s stunningly successful IPO of Circle Internet and Trump’s increasing personal exposure to crypto assets you would have thought the timing is pretty good for a successful flotation! I would expect many other crypto players to pile in as well and try their own flotations.

Back home, UK FCA gives green light to Pisces share trading scheme (Financial Times, Ellesheva Kissin) highlights a very interesting development – that the FCA has given the go-ahead for trading in private companies later this year. Just in case you were wondering, Pisces has nothing to do with fish but everything to do with the Private Intermittent Securities and Capital Exchange System, which is designed to be the missing link between public and private markets and provide a source of funding for fast-growing companies that aren’t yet IPO-ready. * SO WHAT? * They’ve had this over in the US since 2013 in the form of the NASDAQ Private Market which has enabled investors and employees alike to trade company shares. VCs and Private Equity have criticised it because it encroaches on their turf may not attract decent-quality businesses and could cannibalise public markets. This sounds pretty decent in theory but we’ll need to see how it would work in practice.

Then in M&S resumes online orders six weeks after cyber-attack (The Guardian, Sarah Butler and Julia Kollewe) we see that the high street stalwart has made progress since being hacked six weeks ago and says on its website that customers “can now place online orders with standard delivery to England, Scotland and Wales” with deliveries to Northern Ireland to resume in the next few weeks. Click and collect, next-day and nominated-day delivery and international ordering will also be returning over the next few weeks. * SO WHAT? * This is going to be welcome news for all concerned, particularly the retailer itself given that it has been losing about £25m per week in online clothing and homewares sales since the cyberattack. It’ll be interesting to see how quickly M&S will bounce back and whether it’ll benefit from any “revenge spending”!

I saw this – and it really made me think ! You should watch it as it could well save your life…

And on something else completely, please look out for my little video today on LinkedIn and Instagram about how to improve your commercial awareness. I don’t think I’ve ever seen anyone recommend this – but it’s something I used to do all the time when I started my career as a stockbroker in the City…

Trump administration to deploy hundreds of Marines in Los Angeles (Financial Times, Christopher Grimes, Lauren Fedor, James Politi and Tabby Kinder) heralds the latest escalation in the LA protests as Trump is now sending 700 Marines in to protect “federal personnel and federal property”. Hours earlier, California’s governor Gavin Newsom sued Trump for deploying National Guard troops to quell the protests. Military veterans object to Donald Trump’s intervention in Los Angeles (Financial Times, Guy Chazan) highlights objections to Trump’s actions, saying that they constitute a misuse of power that puts soldiers’ lives at risk and Donald Trump tests limits of presidential authority by sending troops into Los Angeles (Financial Times, Joe Miller and Christopher Grimes) emphasises just how far the president is willing to go, pushing the boundaries to their limits, and Trump is provoking LA to fire up his base (Financial Times, Harold Meyerson) puts these actions down to the president appealing to his MAGA base and provoking a situation that didn’t need provoking for the sake of it. * SO WHAT? * It seems to be that this is all about 🍆-swinging and, possibly, distracting Americans from a weakening economy. Jobs growth is slowing, interest rate cuts aren’t forthcoming, corporates are fearing for their existence, investors are taking their money elsewhere, voices of dissent are being silenced and no-one trusts America any more. From Trump’s point of view, LA is a symbol of liberalism and Newsom is a useful scapegoat that he’s already attacked for the fires. As for the Marines, it’s one thing to be sent into wars – and quite another to go up against your own people.

Then in Robert Kennedy fires members of panel overseeing US vaccine policy (Financial Times, Patrick Temple-West) we see that the anti-vaxxer US health secretary Robert F Kennedy has decided to sack all 17 members of a top vaccine advisory committee, a move that’s bound to shift America’s immunisation policy. This committee made recommendations about vaccine dosages for Americans and at what age they should be administered. Kennedy said that “The committee will no longer function as a rubber stamp for industry profit-taking agendas”. The committee had been made up of independent doctors and health officials. What is this man going to do next…

Nearer home, Italy’s citizenship referendum fails after voters heed Giorgia Meloni call for boycott (Financial Times, Amy Kazmin) shows that the referendum that would have accelerated the Italian citizenship process failed before it began due to a low voter turnout (as expected) while in the UK, Winter fuel payments threshold to rise to £35,000, Rachel Reeves announces (The Guardian, Pippa Crerar) highlights the government’s U-turn on winter fuel payments, which will now be restored for about 7.5m pensioners in England and Wales who had it taken away. Pensioners with an income of £35,000 or less a year will get their full winter fuel allowance restored but now there are worries about where the £1.25bn this cost will come from.

Elsewhere, Reeves plans ‘housing bank’ to deliver cheaper financing for builders (Financial Times, Peter Foster, Jim Pickard, Josephine Cumbo and Sam Fleming) highlights government plans to announce the creation of a “housing bank” and a long-term funding settlement for affordable homes of up to £25bn that would help the government’s housing agency, Homes England, give housebuilders more access to cheaper financing. This sounds like a reasonable move, but I believe that the government is still well short of its housebuilding target…

Then in UK pledges £11.5bn of new state funding for Sizewell C nuclear plant (Financial Times, Jim Pickard and Malcolm Moore) we see that the government will end years of questions over its commitment to nuclear energy by announcing a major chunk of state funding for Sizewell C. This is going to be announced later today and signals a change in direction for funding as Hinkley Point C had been financed by the private sector. In other nuclear news, state-owned Great British Nuclear is set to announce which company has won the contract to build a fleet of SMRs. The government also pledged an investment of over £2.5bn in nuclear fusion over the next five years.

In AI-related news, OpenAI expects subscription revenue to nearly double to $10bn (Financial Times, George Hammond) shows that the company’s annual recurring revenue has increased markedly thanks to rising demand for ChatGPT – but let’s not forget that the company is loss-making, as are rivals including Anthropic and Cursor. It does not expect to be profitable until 2029. Interestingly, although the share of US businesses paying to use AI has quadrupled to around the 40% level in the last two years, according to data from fintech company Ramp, growth actually paused in May for the first time in 10 months.

Then in Nvidia chief says UK lacks digital infrastructure as Keir Starmer pledges £1bn for AI (Financial Times, Tim Bradshaw) we see that Mr Semiconductor himself, Jensen Huang, pointed out a rather uncomfortable truth to PM Starmer yesterday when he said that the UK doesn’t have the digital infrastructure it needs to make the most of its potential in AI. On the plus side, he did say that the UK has “incredible” AI research talent and the biggest private investment in AI outside the US and China (although let’s get real here – private AI investment in the UK last year was $4.5bn versus $9.3bn in China and $109.1bn in the US). Nvidia is moving forward on contracts with governments which will allow it to diversify away from reliance on Big Tech companies like Microsoft, Amazon and Meta. It will also launch a new AI tech centre in Bristol to train developers, establish a new body called the UK Sovereign AI Industry Forum that will get local companies like BAE Systems, BT and Standard Chartered involved to push AI adoption. It’s also going to work with the FCA and fintech start-up NayaOne to create a “digital sandbox” that can be used for testing AI in financial services. Wow! All we need now is infrastructure and POWER – and lots of it!!!

Apple to give app developers access to its artificial intelligence models (Financial Times, Michael Acton) highlights some developments from the first day of Apple’s week-long conference. It announced largely incremental changes, perhaps a tad disappointing given that everyone always loves a dramatic announcement or two! Developers will be allowed access to its new AI software features before a full rollout to users in the autumn. The big thing here is that AI models will run locally on Apple’s devices so they won’t need access to a cloud server or network connection. Apple sees this as a big plus for privacy and security. * SO WHAT? * The initial rollout of “Apple Intelligence” has been problematic – there have been real issues with it in China and the upgraded Siri has yet to be launched. The much-anticipated event seems to lack the drama of previous events thus far! Having said that, I do think that Apple’s AI tech sounds interesting and it is known for NOT being a first mover – but when it DOES come along to the party it becomes a category killer!

Then in Fears grow over London market in ‘bid fever’ for UK tech firms (The Times, Alex Ralph and Katie Prescott) we see that three British tech companies were bid for yesterday by American buyers! Spectris (the UK’s leading listed industrial tech company) got a £3.7bn offer from American PE firm Advent International, chip designer Alphawave IP group got an offer of £1.8bn from Qualcomm and then quantum computing start-up Oxford Ionics got an offer from a larger US company for around $1bn! * SO WHAT? * Along with the exodus of companies like Wise, this is worrying indeed. It seems to me that every time we have a half-decent tech company, it gets snapped up. We just don’t seem to have the financial firepower or belief to nurture truly world-leading tech companies here. Just look at what happened to Arm! It was bought by SoftBank, which was subsequently blocked from selling it to Nvidia and then snubbed a London listing in favour of a New York one. If Starmer’s serious about us being at the cutting edge of tech, we need to sort out some way of supporting such companies and reassuring them that they don’t need to go stateside to get the capital that makes them world-beaters.

Then in media news, Warner Bros Discovery to split its TV and streaming businesses (Financial Times, Daniel Thomas) shows that the company will split into two in order to “unlock shareholder value” just three years on from when it was created by the merger of Warner Media and Discovery. The split is likely to complete by the middle of next year and comes not long after rival Comcast did something similar which last year announced plans to spin off its TV networks, including CNBC and MSNBC. Warner Bros break-up leaves shareholders in the cheap seats (Financial Times, Lex) points out that this action is needed as the group’s share price has plummeted by a whopping 60% since it was formed. Still, it’s going to be difficult because although streaming is growing quickly, it’s expensive to build out and it’s in a competitive field with the likes of Walt Disney and Netflix. In addition to this, the TV business is revenue generative but investors don’t find it sexy and subscriber numbers are falling. * SO WHAT? * This is just further evidence of the evolution of TV as it responds to changes in the way we consume media. Comcast is folding its TV networks into a new company called Versant, Skydance Media is buying Paramount Global and AT&T already sold out of their old-school media businesses. Presumably the next move (perhaps a few years down the line) will be consolidation among TV companies and then further consolidation of streamers.

In other big news in the media sector, Why Mark Read stepped down as WPP chief executive (The Times, Emma Powell) highlights the resignation of WPP’s CEO Mark Read who took over almost seven years ago when charismatic founder Sir Martin Sorrell was ousted. Since that time, he’s streamlined the group, returned cash to shareholders and cut debt. However, he leaves a company trying to stem high-profile account losses, an uncertain macroeconomic backdrop and the rising spectre of AI eating away at its business. WPP has also lost its crown of the world’s biggest advertising agency to France’s Publicis and now that Interpublic and Omnicom are getting together, it will fall further down the pecking order. WPP is an accidental advert for AI industry disruption (Financial Times, Lex) reckons that it’s now more likely to become a bid target and The ‘death of creativity’? AI job fears stalk advertising industry (The Guardian, Mark Sweney) discusses the pressure that pressure that AI is putting on the whole advertising industry. The chief exec of one bid ad agency reckons that jobs in strategy and consumer insight along with some conceptual roles should be reasonably safe but those involved in “production and the realisation of ideas” could be vulnerable. * SO WHAT? * FWIW, I would have thought that the advertising industry is not going to be completely destroyed by AI. For people like me, using AI to generate artwork and fancy edits is a godsend because I can’t afford to pay ad agencies big fees. However, I think that for bigger companies, there will still be value in having a proper agency generating creative output that puts your brand out there in a co-ordinated manner across all platforms and making the most of each one.

Meanwhile, Social media creators to overtake traditional media in ad revenue this year (The Guardian, Michael Savage) cites research by, ironically enough, WPP Media which shows that creator-generated content will attract more advertising income this year than content from traditional media companies. The research suggests that content creators are going to get 20% more income this year thanks to revenues through ads, brand deals and sponsorships – and this is expected to more than double by 2030! * SO WHAT? * I guess this all reflects the way everyone consumes media is changing. Back in the day, people used to read newspapers, magazines and watch TV that followed a rigid schedule. Now people prefer to have their own personalised information sources across different platforms and watch what they want when they want. Advertising has to reflect this – and it’s seeing a lot more competition coming from deep-pocketed social media companies who are trying to make the most of their platforms.

In a quick scoot around some of today’s other interesting stories, UK retail sales growth slowed in May, casting doubt on consumer resilience (Financial Times, Valentina Romei) cites the latest data from the BRC which says that UK retail spending growth hit its weakest rate of growth this year in May, suggesting that consumers are having a bit of a wobble.

Then in Eurostar plans services to Frankfurt and Geneva to tap demand for greener travel (Financial Times, Mari Novik and Kieran Smith) we see that Eurostar is planning to launch new services from London to Frankfurt and Geneva in order to service rising business demand. At the

moment, Eurostar only travels to three destinations from London – Brussels, Amsterdam and Paris. Don’t hold your breath though as it’s not expected to happen until the “early 2030s”…

Billionaire Cadogan family enjoy record profit from London estate (The Times, Tom Howard) highlights yet another billionaire family doing well (remember the Grosvenors?) as this time the Cadogans made record profits from their London estate for the second consecutive year in 2024. Rents increased across the estate, which covers 93 acres of land in and around Chelsea. Footfall across the estate continued to rise above pre-pandemic levels.

The skills on display in this video are astounding! I was particularly impressed with the chicken-on-a-skateboard though 👏🐔

Federal agents clash with anti-deportation protesters in LA (Financial Times, Christopher Grimes and Joe Miller) reports on how police and came up against protesters in LA for a third day as Trump called in the National Guard to quell demonstrations against raids on suspected illegal immigrants. Trump invoked a rarely used law on the weekend, overriding objections by local law enforcement, justifying it by saying that “…Los Angeles, has been invaded and occupied by Illegal Aliens and Criminals”. Trump then said in a Truth Social post that he had ordered officials “to take all such action necessary to liberate Los Angeles from the Migrant Invasion, and put an end to these Migrant riots”. Donald Trump’s immigration restrictions threaten restaurant labour shortage (Financial Times, Stephanie Stacey) suggests that the attack on immigrants will put even more pressure on the restaurant industry in an already stretched jobs market. Some are now afraid to come to work and resulting shortages will put even more upward pressure on wages. According to the National Restaurant Association, over 20% of restaurant workers in the US were born outside it. Most are legit but there area a high number of illegals – but Trump’s actions have freaked out both legal and illegal immigrants. * SO WHAT? * Trump’s crackdown is really spreading a lot of fear – among immigrants and business owners alike. Ultimately, you would have thought that more restaurants will go out of business as the inevitable higher prices will prove to be too much for businesses and customers alike. This will probably mean falling consumption and less choice. 

Meanwhile, ABC suspends journalist for calling Trump and adviser ‘world-class haters’ (Financial Times, Anna Nicolaou) shows that a senior journalist at Disney-owned ABC News was suspended “pending further evaluation” for making the remarks on X after midnight on Saturday. The remarks were described by Press Secretary Karoline Leavitt as “unacceptable and unhinged rhetoric”, adding that “ABC is going to have to answer for what their so-called journalist put out on Twitter in the wee hours of the night”. * SO WHAT? * This all just goes to show what happens when you criticise Trump. ABC is already being sued after anchor George Stephanopoulos falsely said on-air that the president had been found “liable for rape”, so will obviously be super-sensitive about any controversial remarks. Trump is engaged in a number of aggressive actions against the media via lawsuits and has also threatened regulatory actions. It really does seem that the White House is gradually bending the media to silence any dissent in order to take complete control of the narrative.

In trade news, Executives converge on Washington to halt Trump’s foreign investment tax (Financial Times, Martin Arnold and Alex Rogers) highlights concerns that are about to be expressed to Trump himself by chiefs of some of America’s biggest companies that plans to hike taxes on foreign investments in the US will hit jobs. The bill that is making its way through Congress currently will allow the US to slap additional taxes on companies and investors from countries whose tax regimes it doesn’t like. Execs reckon that enactment of Section 899 of the bill will ultimately lead to a fall in corporate investment and see a further retreat from investing in US assets. Meanwhile, US companies push for lower Vietnamese tariffs as China hedge (Financial Times, A. Anantha Lakshmi) shows that American companies want the government to lower tariffs on Vietnam because it has, over the years, become a key part of the whole “China plus on” diversification strategy. * SO WHAT? * Vietnam was a big winner from Trump’s anti-China stance in his first term with manufacturing from the likes of Apple, Intel and Nike among the companies to make the move there. This is what led to Vietnam’s massive trade surplus with the US, which Trump attacked with a huge 46% tariff in April. This is a major issue that needs solving asap because Vietnam is a vital part of many American companies’ supply chains. For instance, it now accounts for about 50% of Nike’s footwear production! The 90-day pause on tariffs will end on July 9th so the clock is ticking…

Then in Donald Trump and Elon Musk’s allies urge reconciliation after damaging split (Financial Times, Joe Miller, Alex Rogers, George Hammond and Hannah Murphy) shows that allies on both sides are pushing for the two pouting grown-ups to mend fences in order to limit

the political and commercial damage. It turned out on Friday that Trump said he’d sell or give away the Tesla he bought previously as a show of support for the former “first buddy” 🤣. At the moment, it’s not looking good…

In Trump tariffs could wipe out European steel sector, senior industry figure says (The Guardian, Lisa O’Carroll) we see that German steel, engineering and chemicals giant ThyssenKrupp expressed extreme concern at the European Policy Centre conference in Brussels. Board member Ilse Henne highlighted the danger to industry of Trump’s decision last week to double tariffs on steel and aluminium imports from 25% to 50%. * SO WHAT? * Steel is central to many everyday (and not so everyday) items and if the European steel industry weakens significantly this will have a huge knock-on effect elsewhere – the defence industry immediately springs to mind! As if this wasn’t bad enough already, everyone is going to be worried about the European market being flooded with cheap Chinese steel. This has already been happening as Chinese steel imports boomed by 36% in Q1 of 2025, according to Eurostat. The UK’s steel industry, on the other hand, has managed to swerve the 50% tariff thus far. It will continue to pay 25% until 9th July, but it could go to zero as part of a wider trade deal with the US.

Elsewhere, China prices weaken further as economic pressures mount (Financial Times, Thomas Hale) cites the latest data from the National Bureau of Statistics which shows that China’s consumer price index fell by 0.1% in May. Prices fell for the fourth month in a row and producer prices dropped at their steepest rate in almost two years as domestic demand continues to be weak despite a string of measures announced here and there to spark the economy out of its coma. The problem is that the US-China trade war is overshadowing everything.

In Europe, Italy votes on speeding up citizenship for foreigners (Financial Times, Amy Kazmin) highlights a vote that started yesterday in Italy on shortening the residency requirement for citizenship from the current 10 years to five years. In contrast, EU citizens can get it after just four years. PM Meloni is very much against this but it was sparked into life by a petition and has the backing of opposition parties, labour unions and social activists. The problem is that, to pass, over 50% of eligible voters, plus one must back the motion to be binding. At the moment it looks highly likely that the number of voters will fall short of this target. Still, it’s interesting to see that it made it this far at all. Polls will close this afternoon…

Going back to America again, Westinghouse targets $75bn US nuclear expansion after Trump order (Financial Times, Jamie Smyth) shows that the Pennsylvania-based nuclear developer is in talks with US officials and industry partners about potentially building 10 new big reactors in order to feed into Trump’s aims to prompt an American atomic energy boom (the president’s aim is for nuclear energy capacity to quadruple in the US by 2050). Trump’s Golden Dome pits Silicon Valley against defence giants (Financial Times, Steff Chavez and Tabby Kinder) highlights the pitting of Tech against defence as they bid to build Trump’s much-touted Golden Dome defence shield inspired by Israel’s Iron Dome. The administration has made an explicit appeal for “non-traditional” contractors to get involved, but I have to say that on tech this serious surely existing defence companies such as Lockheed Martin and Northrop Grumman will win out in the end…then in Harvard in talks with universities to host students hit by Donald Trump’s visa clampdown (Financial Times, Andrew Jack) we see that the embattled Ivy League university is in talks with top US and international universities to temporarily accommodate its foreign students affected by Trump’s current clampdown. I guess that this is a damage limitation exercise but I’m sorry to sound defeatist – I just don’t think this is going to work. As I’ve said before, these university years are very important and if you had your heart set on Harvard then you’re not really going to be that chuffed with being packed off to the London Business School (sorry LBS, but you know what I mean). You’ll just pick something yourself – and is that still going to be American??

Disrupted or displaced? How AI is shaking up jobs (Financial Times, Anjli Raval) takes a look at how AI has impacted jobs so far. At Ocado, it has helped orders to be picked in less than half the time – and with fewer workers. White-collar jobs are also being affected. The guy who runs Anthropic reckons that AI could wipe out 50% of entry-level office jobs over the next five years and VC firm SignalFire says that the number of recruits in big tech companies has already dropped by 25% versus 2023. Duolingo CEO on going AI-first: ‘I did not expect the blowback’ (Financial Times, Emma Jacobs) highlights one example of a company that outlined its intentions to go “AI-first” in a LinkedIn post last month that viral – and the blowback it got. Still, Duolingo has always relied on tech, so perhaps users shouldn’t be all that surprised. * SO WHAT? * Even if jobs today are not yet being swept aside at scale, AI is definitely forcing a rapid evolution. Supporters of the tech say that having more “AI literate” workforce will make everyone more productive and able to deliver higher-value work. For instance, biotech company Moderna recently merged its HR and tech functions, IBM has taken it a step further by using AI agents to replace hundreds of HR staff and Klarna says that AI now managed over two-thirds of customer service calls. I think that the key thing here is to be cognisant of what elements of the job can be better executed with AI and those that can’t – and as an employee you then need to adapt. I think that the CEO of Duolingo, Luis von Ahn, put it best when he said, “AI is creating uncertainty for all of us, and we can respond to this with fear or curiosity”.

In other AI news, Microsoft to rank ‘safety’ of AI models sold to cloud customers (Financial Times, Rafe Uddin and Cristina Criddle) shows that Microsoft is going to give AI models ratings based on their safety performance, something that’s likely to sway users on which models and apps to purchase via Microsoft. At the moment, the company ranks three metrics – quality, cost and throughput – but new safety benchmarks will also be useful to differentiate between each model.

Then Apple’s struggles to update Siri lead to investor concerns over AI strategy (Financial Times, Michael Acton) highlights delays to upgrades for its AI voice assistant for the iPhone, prompting speculation that Apple’s going to disappoint next week at its flagship annual event. It’s thought that the company’s attempts to integrate AI technologies has been very buggy, something that hasn’t affected competitors such as OpenAI, because they’ve built their proprietary models from scratch. Meanwhile, Europe’s Mistral benefits from search for artificial

intelligence alternatives (Financial Times, Ivan Levingston, Tim Bradshaw, Melissa Heikkila and George Hammond) shows that Europe’s most well-known AI start-up, Mistral, has managed to win new contracts worth hundreds of millions of dollars thanks to European companies want to establish regional champions. This should definitely help with further fund-raising! Given all the American and Chinese drama, there’s an increased impetus for investors and companies alike to seek alternatives to US Big Tech in particular.

Back home, UK ministers delay AI regulation amid plans for more ‘comprehensive’ bill (The Guardian, Eleni Courea and Kiran Stacey) shows that the government is going to delay regulations governing AI for at least a year as it is moving to introduce a “comprehensive” AI bill in the next parliamentary session to address areas such as safety and copyright. The government had originally planned to put in place a narrower AI bill early doors that would have forced companies to hand over their AI models to the UK’s AI Security Institute for testing. Is this delay evidence of the government’s desire to appease Big Tech and Trump? * SO WHAT? * The creative sector has hit back and you would have thought that there will be a gaping hole in security and use of material in the meantime.

Then in Nvidia partnerships boost UK as tech week begins in London (The Times, Katie Prescott) we see that the chipmaker will unveil a raft of UK partnerships to bolster AI capabilities and talked about working with the government to help businesses make best use of AI. It has committed to help train 100,000 people by 2030. * SO WHAT? * This is a positive development, particularly at a time when it looks like France is edging ahead of the UK in terms of AI as it has been using tax breaks to encourage the AI start-up ecosystem and has a lot of nuclear power to supply power-hungry data centres.

Sam Altman’s eyeball-scanning digital ID project to launch in UK (Financial Times, George Hammond) heralds the arrival in the UK of Altman’s digital ID project, World, that scans people’s eyes, generating a unique digital ID. World asserts that the verification tool it’s developing will help banks detect fraud, mean that dating apps just contain humans and that concert tickets aren’t bought up by bots. * SO WHAT? * This sounds great in theory but a number of countries have expressed concerns over security and privacy. The project was started in 2019 but launched properly in the US in April.

In a quick scoot around some of today’s other interesting stories, Chinese regulators seek to slow rollout of self-driving features in cars (Financial Times, Edward White and Gloria Li) shows that the rapid development in China of driverless technologies is going to slow down for the moment as regulators have become increasingly alarmed. They will be doing a deeper dive on safety and liability. At the moment, about 20% of new cars sold in China have high-level autonomous functions – but a fully-formed solid legal framework to back all this up is not yet in place. * SO WHAT? * There is a lot of support for driverless tech at the top level, but the government hasn’t given a clear roadmap on any legal framework, preferring thus far to leave it with local governments to deal with. Chinese insurance and transport regulators usually look at best practices overseas to guide them – but China is at the cutting edge of this tech so will have to be pioneer in regulation as well! It’s going to be complicated but it will be necessary as the tech continues to proliferate…

In financials news, Private equity firms overhaul exit strategies as IPO market slams shut (Financial Times, Alexandra Heal and Ivan Levingston) further highlights challenges that some PE firms are facing as the relative drought of IPOs continues for longer than expected (although it seems to me like it’s been picking up recently). Some PE firms are looking to break their investments up and sell off those parts. * SO WHAT? * When you consider that the volume of PE-backed IPOs has dropped from 116 in H1 2021 at their height to just 9 across Europe and the US in the same period so far this year, you can understand the concern! The backlog of assets gathering dust continues to build. That being said, things can change quickly and recent IPO activity might gather momentum…

In personal finance news, Mobile millennial millionaires pose threat to wealth managers (Financial Times, Josh Spero) highlights challenges faced by wealth managers who are

increasingly seeing rich millennials take flight (in terms of tax residence), according to consultancy Capgemini. 25% of millennials with over $1m in investable assets said that they’d moved in 2024 and another 25% said they’re planning to relocate in 2025. This is bad news for wealth managers who are seeing an exodus of clients. It was also interesting to note from the Capgemini survey that 81% of those who were going to inherit wealth intended “to switch their parents’ wealth management firm within one to two years after inheritance” – and this is prompting wealth managers to change their strategies by offering more access to crypto assets, developing AI-enabled digital platforms and raising the quality of their relationship managers. Another challenge they are facing is identified in Living longer — the ‘fundamental financial challenge’ (Financial Times, Moira O’Neill) which cites research from professional services firm Barnett Waddingham that shows that people underestimate how long they are likely to live after they retire, meaning that their finances can be exposed. The research analysed data on people in defined benefit pension schemes. Women under such schemes tended to underestimate their life expectancy by seven years while men underestimated by four years. Wealth advisors now tend to model a couple’s cash flow up to the age of 93 while one firm even models to 100.

Then in How £7 pints are destroying Britain’s pubs (Daily Telegraph, Daniel Woolfson) we see that rising beer prices powered by higher food, fuel and labour costs – not to mention the price of beer itself – have combined to hit pubs badly. Even though customers are increasingly becoming more understanding about why this is necessary, everyone has a limit – and publicans are wondering whether we’re reaching it. The British Beer and Pub Association (BBPA) says that the average price of a pint across the UK breached the £5 mark for the first time this year, but many say that the real figure is more like £7, particularly if it’s premium. Are we that far off from a tenner a pint??

Did you know that there are different types of chihuahuas? This video will enlighten you 🤣🤣🤣

Donald Trump attacks ‘crazy’ Elon Musk as relationship implodes (Financial Times, Joe Miller) heralds the messy end of what has been a passionate bromance between two of the world’s most powerful and richest men. Trump branded Musk as “crazy” and threatened to cancel his government contracts as he threw his toys out of the pram for Musk slagging off his “big, beautiful bill”. Musk even went as far as calling for Trump to be impeached, said that his tariffs could push the US into recession, threatened to decommission SpaceX capsules used to transport NASA astronauts and hinted of Trump’s association with Epstein. Musk even spoke of starting a new party and forcing the Republicans out of office while Trump said that Musk had turned against him because he “took away his EV mandate”. * SO WHAT? * Never a dull day. The whole ridiculous nature of this implosion has the whiff of the cartoon-like “stories” played out in the WWE back in the day (maybe the two men got advice from the secretary of education, Linda McMahon, who has years of experience in this 🤣). Is this just Musk trying to get his street cred back so that people will buy his cars again? This is a very dangerous game that Musk is playing and although Musk observed on X that “Trump has 3.5 years left as President, but I will be around for 40+ years” there’s a lot of damage that can be wrought on him by a vindictive and powerful president.

All of these shenanigans do not make for good optics and Goldman Sachs reins in risk appetite as Donald Trump’s tariffs roil markets (Financial Times, Martin Arnold and Brooke Masters) shows that the investment bank had moderated its risk positioning because of the market volatility prompted by Trump’s actions. It also cited concerns about ongoing investor appetite for dollar-denominated assets given that the US debt mountain is highly likely to get even bigger. Goldman Sachs’s president and COO John Waldron said that he did not expect a recession – rather “slowflation” where GDP growth would perhaps be around 1-1.5% and inflation would be around 3%. He expects more uncertainty to come and expressed unease at the way debt is going, an opinion that has been echoed by rival Wall Street big cheeses at JP Morgan and BlackRock.

Meanwhile, Donald Trump and Xi Jinping agree to launch new round of trade talks (Financial Times, Edward White and James Politi) highlights some positive developments in the whole US-China tussle as the two leaders agreed to launch a new round of high-level trade talks after a bit of a testy week or so but then Judge blocks Donald Trump’s ban on foreign Harvard students entering US (Financial Times, Andrew Jack) shows that a US district judge managed to

temporarily block the administration’s latest attempt to ban international students from Harvard. * SO WHAT? * I think that this judgment will turn out to be a bit of a token gesture because I think that the damage has already been done. Who would want to chance their education and go there now even if Harvard wins its case? These are precious years in a person’s life and there are plenty of other academic institutions around that won’t feel like some kind of political minefield.

Then in Trump Media seeks to launch ‘Truth Social bitcoin ETF’ (Financial Times, George Steer, Will Schmitt and Alex Rogers) we see that the president’s family media company is looking at launching a bitcoin ETF to surf the wave of growing enthusiasm for digital currencies, an enthusiasm that Trump is directly stoking. TMTG announced yesterday that it had filed an application with US regulators to create the “Truth Social Bitcoin ETF”. If this ever fails for whatever reason, it will be like a massive house of cards…

In altogether more sedate news, ECB cuts interest rates to 2% in effort to bolster flagging eurozone growth (The Guardian, Phillip Inman) highlights the decision by the ECB, announced yesterday, to cut its interest rates by 0.25 percentage points to 2% in its eighth such cut in a year. The ECB said that it needed to cut the cost of borrowing in the face of the impact of Trump’s tariffs. Only one member of the ECB’s 20-strong committee voted to keep rates on hold – everyone else voted for the cut. ECB President Lagarde would not be drawn on the possibility of further cuts.

Back home, UK inflation overstated due to government data error, ONS says (Financial Times, Valentina Romei and Sam Fleming) highlights another example of ONS incompetence because now it turns out that they overstated the UK inflation figure by 0.1% in April because a mistake had been made in the tax numbers provided by a government department. The figure for April now has to be revised down from 3.5% to 3.4%. The market had expected 3.3%. * SO WHAT? * What is going on with the ONS?? This clown-like error follows on from its inability to provide accurate employment data. WE NEED PROPER DATA for the country to function!!! In a way it’s good that the ONS can admit its mistakes, but to make such howlers at such a sensitive time in the world economy is unforgiveable IMO. Their statement which said “We are working hard to address pressing issues and will publish a plan shortly to outline the restoration of our key statistical outputs” doesn’t exactly inspire confidence.

Big investors shift away from US markets (Financial Times, Harriet Agnew, Mary McDougall, Harriet Clarfelt, Kate Duguid, Alexandra Heal and Ivan Levingston) echoes the sentiment mentioned in the previous section by the COO of Goldman Sachs as big institutional investors are increasingly migrating away from US markets due to the uncertainty of the trade wars and the prospect of growing debt. Some believe that Trump’s tax bill will add $2.4tn to America’s debt over the next ten years and the concerns were reflected in a poll of fund managers published by Bank of America that shows the biggest underweight position in the US dollar in almost 20 years. Investment has been shifting towards Europe. * SO WHAT? * Everyone has got used to the US being the premier destination to park their cash for a very long time and at the start of this year, US equities made up about two-thirds of the value of global equities! The question is whether this asset shift is temporary or whether Europe is just providing a bit of shelter in the current storm.

Meanwhile, Circle Internet shares soar 168% on NYSE debut (Financial Times, Phillip Stafford and George Steer) highlights a stellar performance for the stablecoin operator on its market debut. Demand was so strong, in fact, that trading was halted three times due to volatility! The listing, which raised $1.1bn, is one of the biggest ones in the US this year and could be a sign that sentiment is improving regarding flotations. Chime Financial and Klarna will be crossing their fingers that this is the case! Lessons from a stablecoin IPO: tech turns on a dime (Financial Times, Lex) makes an interesting point about how Circle’s expectations of how its business would look when it last considered an IPO have turned out to be quite different to what they are now –

but it also says that there are risks of increased legislation covering stablecoins that could potentially clip the wings of its share price in future.

Wise to move main listing to New York in further blow to London (The Times, Alex Ralph) shows that the £12bn fintech company has decided to shift its main listing stateside because it was the “deepest and strongest capital market in the world”. The only consolation here for the LSE was that it said that it would keep a secondary listing in London. Leaving London’s market is not always a Wise move (Financial Times, Lex) points out that making the move is not a guarantee of greater riches and that it may not actually get that much more access to big investors, because it already gets that in London. Stock exchange dealt another blow as £12bn fintech ditches main London listing (The Guardian, Lauren Almeida) bemoans this move as another setback for the LSE. * SO WHAT? * This really IS bad news for the LSE as Wise was, as Peel Hunt’s head of research Charles Hall said “founded in London, scaled in London and floated in London”. Unlike some other candidates that have been tempted by the bright lights of New York due to their businesses becoming more America-weighted, Wise has decided to ditch the opportunity to be a big fish in a smaller pond (the FTSE100) to a small fish in a massive ocean (the NYSE). Studies by UBS show that where a company is listed does not have much impact on valuation but this move perhaps reflects the PERCEPTION of a London listing – and this may prove to be more decisive than data showing otherwise. The LSE needs to do all it can to stamp this out otherwise its fortunes will continue to decline…

Tesla’s market value suffers biggest one-day drop after Trump-Musk spat (Financial Times, George Steer) highlights a chunky 14% one-day drop for the embattled EV maker as the battle of the billionaires played out in public while UK sales of new Tesla cars slump by more than a third amid Musk backlash (The Guardian, Julia Kollewe) cites the latest figures from the SMMT which show that sales of new Tesla cars in the UK fell by a chunky 36% in May – in stark contrast to BYD’s sales rising by 407% (admittedly from a low base last year). In absolute numbers, Tesla sold 2,016 vehicles in the UK in May versus BYD selling 3,025.

One in 10 cars sold in Britain are Chinese (Daily Telegraph, Matt Oliver) points out the rise in popularity of Chinese brands here. At the moment, SAIC Motor-owned MG is the biggest selling Chinese brand while BYD, Geely-owned Polestar, Omoda and Jaecoo are all making ground. You do wonder whether the European makers can respond to this at all!!!

In a quick scoot around some of today’s other interesting stories, EU hit by surge in steel imports as US tariffs divert shipments (Financial Times, Andy Bounds) highlights a major influx of steel to Europe that had been destined for the US as the real-world impact of Trump’s tariffs take effect. Europe’s steel industry is calling for Brussels to take swift action to stem the flood. At the moment, imports of stainless steel bars and rods have shot up by over 1,000% year-on-year while prices have plummeted by 88%.

JPMorgan says it will fire analysts who accept future-dated job offers elsewhere (Financial Times, Ortenca Aliaj and Sujeet Indap) is an interesting article that highlights the bank’s no-nonsense attitude towards flaky graduates who want to have their cake and eat it. Its new policy says that incoming grads who accept future-dated job offers elsewhere within 18 months of beginning their analyst programme they will get the sack. This highlights the escalation of the war on talent between investment banks and private equity firms who have different hiring cycles. PE firms are being naughty by letting investment banks train up the grads for two years before skimming them for themselves.

In Wizz Air suffers £500m slump as engine troubles ground planes (Daily Telegraph, Christopher Jasper) we see that the budget airline’s share price dropped by a whopping 25% in trading yesterday on news that it was forced to ground dozens of its planes due to engine troubles. The company’s CEO said that the airline was forced to lease 12 aircraft and 40 spare engines to maintain its existing flight schedule, which all pushed up expenses. The company expects this situation to go back to normal next year but although it predicted revenues to rise this year it did not provide any profit forecasts.

Nintendo set to sell out Switch 2 console at global launch (Financial Times, David Keohane) marks the launch of the Switch’s successor yesterday! Online pre-orders have been strong and hopeful shoppers have queued outside stores around the world to have a chance at getting their hands on a console! The hype is real!

This is a video of two people doing pull-ups – with a difference! I think that this is insanely impressive! I need to go away and practice now 🤣

In Donald Trump targets immigrants and Joe Biden in a burst of orders (Financial Times, Steff Chávez and James Politi) we see that the president has now turned his attention to immigrants and Biden by banning citizens of 12 countries from entering the US and launching an investigation into the alleged concealment of Biden’s mental decline during his time in office. He also doubled-down on his vendetta against Harvard Uni by scrapping visas for students looking to study there. Citizens from Afghanistan, Chad, the DRC, Equatorial Guinea, Eritrea, Haiti, Iran, Libya, Somalia, Sudan, Yemen and Myanmay will be banned from entry to the US from June 9th. Citizens of Burundi, Cuba, Laos, Sierra Leone, Togo, Turmekistan and Venezuela also face partial restrictions and Trump threatened that more could be added to the list “as threats emerge around the world”. Regarding the Biden thing, he said that there would be an investigation into “whether certain individuals conspired to deceive the public about Biden’s mental state”. You do wonder whether such dramatic actions are distraction tactics given that Donald Trump’s ‘big beautiful bill’ will swell US debt by $2.4tn, warns fiscal watchdog (Financial Times, Myles McCormick and Lauren Fedor) highlights concerns from the Congressional Budget Office about the massive impact his BBB will have on America’s already sizeable debt pile. Funnily enough, press secretary Karoline Leavitt said that the financial watchdog “has been historically wrong” and said that the institution “has become partisan and political”. Meanwhile Donald Trump demands rate cut from ‘too late’ Jerome Powell (The Times, Louisa Clarence-Smith) shows that Trump is revisiting his pressure on the Fed to cut interest rates. His excuse for trying to pressure what should be an independent institution is that the latest data reflected a slowdown in hiring. He added that the ECB had cut its rate nine times. * SO WHAT? * I may well be wrong but I can’t remember a time where the Fed has “followed” the ECB – from what I can remember it feels like it is always the other way around. It seems to me that Trump is getting frustrated and whenever this happens he does something to appeal to the masses. This time, he’s decided to ban immigrants and launch an investigation into his predecessor. Although I believe that there was a lot wrong about Biden’s administration, something that seems to be coming to a head with the release of some tell-all books about what happened behind the scenes in his bid for re-election, doing an investigation now seems to be needlessly vindictive. What’s the point? I guess the idea is to weaken the credibility of the Democrats, the implication being that they can’t be trusted to have America’s interest at heart but it seems to me to be a waste of resources. Why not just let the books do the damage and just poke it now and then??

In EU-China news, EU urges China to loosen rare earth curbs as carmakers near crisis point (Financial Times, Peter Foster, Andy Bounds, Barbara Moens and Kana Inagaki) highlights the increasingly tricky situation being faced by the EU’s car industry as the China restrictions on rare earth exports could result in car manufacturers stopping production. The EU wants China to loosen these restrictions that were put in place by China’s Ministry of Commerce in early April in response to Trump slapping massive tariffs on the country. The impact of these restrictions has already been felt as Fordhad to temporarily suspend production at its SUV plant in Chicago last week because of a shortage of magnets. In the meantime, China plots giant Airbus order as Xi Jinping cosies up to Brussels (Daily Telegraph, Louis Goss) reflects rather cosier developments between the EU and China as China is on the verge of ordering up to 500 planes from Airbus!

This would be a major slap in the face for Boeing. If the order went ahead, it would be one of the biggest single orders of commercial aircraft in history! The current record is for Indian airline IndiGo which put in its order for 500 Airbus planes in 2023. * SO WHAT? * China has the EU by the ⚽⚽ on rare earths because it accounts for 90% of the processing of rare earth magnets. Although the EU is desperately trying to fend off the mass dumping of cheap Chinese EVs in the bloc, I can see that it is going to have to relent. In a way, it looks to me like a lose-lose situation for Europe because if it digs its heels in, China can continue to choke off the supply of rare earths and that will put even more pressure on an already-embattled sector. But if it relents, Chinese car manufacturers facing sluggish demand in their domestic market are going to flood Europe with cheap EVs and kill European makers anyway. I think that we are at a very delicate point in time where the wrong move could well decimate European car making.

In other macro news, Indonesia rolls out $1.5bn stimulus as economic fears mount (Financial Times, A.Anantha Lakshmi and Diana Mariska) shows that south-east Asia’s biggest economy is rolling out a raft of stimulus measures in order to spark consumer spending. The idea is to mitigate slowing economic momentum as weakening commodity prices and Trump tariff concerns continue to cast a cloud over the economy. Measures include discounts on transportation fares and wage subsidies for two months as well as toll road discounts and supplementary social aid for those most in need. * SO WHAT? * The government had committed to grow GDP by 5% this year, a growth rate that it’s been able to sustain for a decade – pandemic aside – so the world’s biggest exporter of nickel, coal, palm oil and other commodities is suffering the fallout of the current trade war. President Prabowo wants to lift GDP growth rates to 8%, but that’s looking tricky at the moment. Although the measures look like they’ll really benefit lower income households, some feel that more is needed to power the economy forward as a whole.

Meanwhile, Friedrich Merz plans €46bn corporate tax breaks to revive German economy (Financial Times, Anne-Sylvaine Chassany) shows that the German government is going to try and pass a huge package of corporate tax breaks over the summer in order to get the economy out of its current rut. Tax exemptions include deductions for new equipment and new electric vehicles as well as subsidised electricity costs Germany’s manufacturing industry. This all comes in addition to the €1bn+ spending plan to bring its armed forces and infrastructure up to date. Sounds good, but it’ll be a while before the effect is seen – and that is if it all gets passed!

Back home, Winter fuel payments to return — but half of pensioners will miss out (The Times, Chris Smyth and Steven Swinford) shows that the chancellor is looking likely to restore winter fuel payments but will do it by clawing back money from wealthier pensioners via higher tax bills. The Treasury is looking to make winter fuel payments depend on average incomes. 5 million wealthier pensioners will get higher tax bills over the next financial year to finance the restoration of a £300 grant to 10 million pensioners from this autumn. One plan is to base the threshold below which you get the payments on the average level of real household disposable income, which currently stands at about £37,000.

In consumer trends, Wealthier Americans flock to dollar stores as tariffs stoke consumer angst (Financial Times, Gregory Meyer) shows that now wealthier households are shopping at discount stores Dollar Tree and Dollar General as economic concerns filter through to households. Dollar Tree’s CEO said yesterday that the company “saw a meaningful traffic increase from customers with household incomes of more than $100,000” while the CEO of Dollar General said that its share of “trade-in” customers from more affluent households hit its highest level for four years. The story is also reflected by the contrast in fortunes of Walmart, which has consistently low prices, and Target, which has a more affluent customer base. Walmart’s seeing sales grow across all of its customer base whereas Target is seeing a fall in same-store sales.

In the UK, Lower-income consumers missing out on pay rises fuels fall in sales at B&M (The Guardian, Joanna Patridge) shows that British discount retailer B&M is suffering as it said that its lower-income customers are buying less because of “limited real wage growth” after having previously received emergency cost of living support payments. This payment ended in February

2024. * SO WHAT? * It seems that the company’s management is getting the strategy wrong at the moment because you would have thought that they should be raking it in at the current time, what with uncertain economic sentiment and ongoing pressure on household incomes, particularly given rising prices. Their whole existence is based on being cheap and cheerful when money’s tight (just look at what’s happening with its American equivalents as per what I just said above). It even seemed to acknowledge this when it admitted that its “operational execution could have been better”. That sounds to me like management-speak for “we **cked up” 🤣.

In business trends news, UK service sector confidence higher in May than since before autumn budget (The Guardian, Phillip Inman) cites the findings of the latest service sector PMI which highlight rising business confidence. This may be at least partly due to the fact that Trump’s tariffs have largely affected manufacturing rather than services (so far, at least!). This is important because the services sector represents about 75% of the UK’s GDP.

In a quick scoot around some of today’s other interesting stories, L’Oréal poised to seal €1bn deal for skincare brand Medik8 (Financial Times, Oliver Barnes, Adrienne Klasa and Ivan Levingston) shows that the French cosmetics giant is on the verge of buying UK skincare company Medik8 to augment its offering of premium beauty brands. Medik8 was founded in 2009 and is currently owned by London-based PE firm Inflexion. There were no official comments made about the deal but something is expected to be announced in the coming days…

In Meta Talks to Disney, A24 About Content for New VR Headset (Wall Street Journal, Ben Fritz and Jessica Toonkel) we see that Meta is talking to entertainment brands including Disney and A24, plus a number of smaller production companies, about the provision of exclusive content for a premium VR headset that it’s planning to release next year. Meta’s upcoming device, known internally as Loma, is more powerful than the current Meta Quest VR and looks more like a big pair of glasses rather than goggles. It is aiming to charge less than $1,000 for the device, which is way more than the $300 starting price for a Quest but way less than then $3,500 base price of a Vision Pro. Disney is currently working on a Star Wars experience for the

Meta Quest. * SO WHAT? * This sounds exciting, don’t you think? The price point sounds much more realistic than Apple’s and the form factor is also attractive. We’ll just have to wait until we see something in production!

Chime’s IPO may struggle to strike a chord with investors (Financial Times, Lex) suggests that the neobank’s upcoming IPO might not be a flier because investors may be more turned off by potential risks than turned on by “attractive” valuations. I’ve already mentioned the contrast between Chime Financial’s current estimated implied valuation of $11.2bn and the $25bn valuation it had in a private funding round in 2021 but the article maintains that even at this level, the company is not cheap, particularly when compared to more tried-and-tested names like PayPal and Block. One big risk for Chime is that it makes a lot of money from interchange fees which are collected every time customers use their Chime-branded debit or credit cards. It’s been able to charge more than rivals because it’s smaller, so it’s possible that profits could take a big hit if they grow through a regulatory threshold of $10bn of assets because these fees will then be capped.

This sounds like a simple method of persuasion. I’m not sure whether it really works, but perhaps try it out and see!

And so the tax rollercoaster ride continues! Donald Trump orders 50% steel and aluminium tariffs to begin on June 4 (Financial Times, Myles McCormick) highlights Trump’s latest tariff attack as he signed another executive order last night that will double existing 25% levies on steel and aluminium imports. He justified this move by saying that it would stop foreign producers from dumping cheap product on the market that would “threaten to impair the national security”. British industry exempted from Trump’s doubling of steel tariffs (Financial Times, Peter Foster, George Parker, Madeleine Speed and Sylvia Pfeifer) shows that we were exempted from this for the time being, with the import tax for us remaining at the 25% level, in order “to allow for the implementation of the US-UK Economic Prosperity Deal” which could potentially see that 25% go to zero. * SO WHAT? * This latest tax attack obviously drew immediate criticism from Canada, the biggest supplier of steel and aluminium to the US. However, it’s not just bad news for Canada – it’s bad news for everyone because all the steel and aluminium that would have gone to the US is now going to be dumped elsewhere.