Friday 21/11/25

US plan for Ukraine-Russia peace calls on Kyiv to cede land under its control (Financial Times, Amy Mackinnon and Christopher Miller) takes a look at the “peace” deal being put forward to Ukraine. The 28-point plan reads like Putin’s Christmas wish list. Ukrainian officials said that they were put under intense pressure by the Americans to accept the plan that includes a number of red lines that the Ukrainians won’t cross. It looks like Trump’s pushing for yet another Ukraine ambush to end the year on…

While Trump is talking tough on the Ukraine war, Donald Trump lifts 40% tariff on some Brazilian food products (Financial Times, Michael Pooler and Aime Williams) shows that he is softening his stance on some agricultural imports from Brazil including coffee, beef and fruits. I guess that he realised that his actions adversely affected prices of goods that are important to all Americans! Will he relent on pasta from Italy though?? The tariffs on pasta imports are just ridiculous…

In Asia, Japan’s Takaichi unveils $135bn stimulus to spur growth (Financial Times, Leo Lewis) shows that the Japanese PM announced a highly-anticipated package of measures designed to prompt economic growth and protect households from the rising cost of living. This is her first major policy announcement and is the biggest stimulus since Covid. The idea is for this to provide a buffer to Trump’s tariffs (Japan is a major exporter) and bolster investment in areas including shipbuilding and AI. Meanwhile, When Chinese tourists reroute, so do Japan’s investors (Financial Times, Lex) highlights the impact that China’s latest slagging of Japan is having and that it really could have long-lasting consequences. Beauty group Shiseido has seen its share price fall by about 20% since hostilities began as the China market and travel retail segment represents over a third of the company’s global sales. Chinese visitors are the biggest spenders among all foreign tourists to Japan, making up over 25% of all inbound consumption as well as

25% of the number of foreign visitors. * SO WHAT? * This is clearly bad for Japan, but in a way I have no sympathy because we’ve seen this all before on a few occasions.  I would even say that a bit of arrogance has probably crept in in Japan as there have been rising complaints of “over tourism”. Well how about cutting the numbers drastically and seeing how you like it then?? Given that Japan is likely to suffer from being a predominantly export-driven country it needs things like tourism to fire on all cylinders. It certainly needs to do a better job of attracting visitors from other countries as it’s grown too dependent on China.

Brussels slashes €6.7bn price tag for UK to join EU defence fund (Financial Times, Peter Foster, David Sheppard and Andy Bounds) shows that Brussels may possibly be thawing in regard to letting the UK join its exclusive defence club. Apparently, the price to join the €140bn Security Action For Europe (SAFE) loan guarantee scheme is now down to “only” €2bn. There is still a gaping chasm between the new “knock-down” price and the €75m we were offering and there’s not much time to go before a deal deadline of November 30th. The UK side says that there’s got to be value for taxpayers and British industry. As things stand currently, EU countries are allowed to spend up to 35% of the rearmament fund with UK defence companies, but if the UK joins SAFE, this could go up to 50% so Brussels is arguing that the UK needs to contribute an amount that reflects the benefit that British industry will get. Negotiations are continuing…

In markets, US tech stocks slide as jolt of volatility hits Wall Street (Financial Times, George Steer, Emily Herbert and Rachel Rees) shows that US stocks weakened again in trading yesterday following the mid-week Nvidia relief rally. The weakness spread to Asia – and bitcoin! Trading teams at investment banks will be loving all this volatility as it’s great for pepping up buying and selling activity…

In employment news, US economy’s strong job growth casts doubt on early Fed rate cut (The Times, Jack Barnett) cites the latest data from the US Bureau of Labor Statistics which smashed forecasts on the number of jobs created in September and was up strongly on the net job losses in August. * SO WHAT? * These were the first stats to be published since the government shutdown was lifted. That being said, unemployment rose from 4.3% in August to 4.4% in September, the highest it’s been since the pandemic. Maybe it pays to sack the head of the Bureau of Labor Statistics in order to get more favourable numbers, eh?? The better numbers might prompt members of the FOMC to keep interest rates on hold at the next meeting, though, because if there are more jobs knocking around then the argument is that people are going to spend – and if they spend then there’s a risk that inflation could rise and if inflation rises, interest rates might have to go UP again. Trump wants them to come down.

Meanwhile, in the UK, Number of jobless young men surges in ‘tragedy of wasted potential’ (Daily Telegraph, Emma Taggart) cites the latest release from the ONS which shows that the number of men Not in Education, Employment nor Training (NEETs) boomed in the three months to September by 3% while the number of female NEETs fell by 3.8% versus the previous quarter. Adzuna data pointed out that the number of entry-level roles in the UK is also falling. * SO WHAT? * Economic uncertainty, the increase in employer NICs and wage rises have contributed to a reluctance to hire. Companies also like to blame AI uptake as another reason to slim down their workforce. Everyone’s waiting to see what’s going to happen in next week’s Budget…

In the world of law, US law firms give bonuses three times the size of English rivals (The Times, Jonathan Ames) shows that the bonus season is looking good for lawyers in the City who work for American law firms! Fried Frank have announced associate year-end bonuses of $149,000 with the added possibility of getting an additional $25,000, all depending on billable hours.

Another US law firm, Cravath, announced $140,000 year-end bonuses to associates in New York, Washington and London. In contrast, it is thought that top associates at London’s Magic Circle firms are getting no more than “just” £45,000 in year-end bonuses. How are they going to scrape by on this when associates are paid around £150,000 while their US law firm colleagues get £180,000?? It’s going to be a tough Christmas 😜. That second ‘rarri or Porker is going to have to wait. At least they work so many hours, they don’t have enough time to spend it…

Meanwhile, Clifford Chance cites AI as it axes 10 per cent of back-office staff (Financial Times, Suzi Ring) shows that the Magic Circle law firm announced that it’s going to cut business services staff headcount in London by around 10%. The axe is coming down in finance, HR and IT departments. This has been blamed on greater use of AI and falling demand for some business services. In addition to this, more work is being done at hubs in Poland and India. What a 💩ty Christmas present for those affected. * SO WHAT? * Repetitive, process-driven roles are going to continue to be affected by AI, but it feels to me that AI is being used as a convenient excuse to trim areas that are less-easily justifiable. Not great.

Then in consumer news, Consumer confidence shaken by budget tax jitters (The Times, Jack Barnett) cites the latest report from GfK which showed consumer confidence falling over the last month. This is to be expected given all the pessimistic assumptions we are all bracing ourselves for ahead of next week’s Budget! As I keep saying, though, I think that expectations are now so low that if it turns out to be not as bad as everyone is assuming, there could be a major bounce going into the end of the year. Here’s hoping!!!

American Shoppers Are Looking for Deals and Walmart Is Cashing In (Wall Street Journal, Sarah Nassauer) highlights Walmart’s success thanks to less affluent customers just buying basics and more affluent customers trading down. In fact, the company’s biggest gains are coming from higher-income shoppers. America’s biggest retailer by revenue announced strong sales for the most recent quarter and was confident enough to raise its outlook for the full year. * SO WHAT? * The divergence in fortunes on the haves and have-nots continues to grow – and the same is true of the wages they’re getting paid as well! According to Bank of America stats, wage growth for higher income households grew by 3.7% in October while that of lower-income households was up by just 1%. Food prices have now increased by a whopping 25% compared with five years ago.

Back in the UK, Asda to raise £568m in store sell-off as sales continue to fall (The Guardian, Sarah Butler) shows that the struggling supermarket is selling off 24 stores and a distribution centre – and leasing them back – in order to raise money. * SO WHAT? * This is a classic move by retailers with large footprints when they want to raise money but it’s unclear as to whether this is going to do anything for what the real problem is – weak sales. Let’s hope that chairman Allan Leighton – the former saviour of Asda in a past life – has more up his sleeve.

In apparel retail, Gap Raises Fiscal-Year Outlook on Growing Demand Across Income Levels (Wall Street Journal, Kelly Cloonan) shows that turnaround momentum is continuing at Gap as

consumers spanning different income brackets bought more of its apparel in the latest quarter but UK is worst-performing market for JD Sports as youth unemployment hits sales (The Guardian, Sarah Butler and Richard Partington) highlights concerns expressed by JD Sports that unemployment among young people is damaging sales growth and profits. Some are also blaming sluggish performance on its over-reliance on Nike, which many have said are struggling to keep consumer interest.

Meanwhile, on the high street, Nando’s plans UK expansion despite higher labour and energy costs (The Times, Jessica Newman) shows that the casual dining chain wants to accelerate its expansion plans despite warning about the damaging effect of higher labour and energy costs. It opened 12 new restaurants in the year to the end of February and wants to open 14 more within the current fiscal year. It’s looking to increase the number of company-owned restaurants and broaden its international footprint. It currently operates in over 20 countries and has almost 500 restaurants in the UK and Ireland alone. * SO WHAT?  * I think that this is a bold move by the chain, bordering on the unwise. Casual dining chains like this are surely going to suffer in straitened times because they tend to attract younger people (higher unemployment, not got loads of money) and families (even “cheap” meals out cost loads if, say, you’re buying for four people). I’m not as optimistic as they are but good luck to them.

In a quick scoot around some of today’s other interesting stories, Paramount, Comcast and Netflix Submit Bids for Warner Bros. Discovery (Wall Street Journal, Joe Flint and Lauren Thomas) shows that the three media giants have put in nonbinding bids for Warner Bros Discovery. Additional rounds are expected and the company said that it wants to conclude the bidding process by the end of the year. In the meantime, Warner Discovery is moving on with plans to separate itself into two companies – one entity to house its studios and streaming with other to house its cable networks. Out of the three, only Paramount is looking to buy the whole lot. We’ll just have to wait and see how this pans out…

Meanwhile, Paramount wins rights to show Champions League games in UK (Daily Telegraph, James Warrington) shows that the media giant managed to secure the media rights to broadcast UEFA Champions League matches in the UK for four years from 2027. It will displace TNT Sports which currently holds the rights to most of the games.

In tech news, OpenAI says new GPT-5 model speeds up research in maths and science (Financial Times, Melissa Heikkilä) highlights OpenAI’s assertion that its latest AI model is helping to accelerate research in maths, biology and physics. * SO WHAT? * Clearly this is going to be a highly lucrative area, so the race is on to provide the best models. I would have thought

that it will be pretty important to be the first one to crack the market as that product is likely to be widely adopted. Last month, Anthropic outlined plans to integrate its Claude model into tools that are used by researchers and life science companies…

I thought I’d mention Dutch government steps back from Nexperia intervention to ease chip supply issues (Financial Times, Kana Inagaki, Andy Bounds and Sebastien Ash) although it’s actually a story that I should have put in yesterday’s edition of Watson’s Daily! Basically, the Dutch government announced last month that it would be taking over Nexperia’s operations but it caused such ructions with China and concern in the car manufacturing industry that it’s now backed down and suspended its intervention. It remains to be seen as to whether the Dutch government is going to make a complete withdrawal – if it does, it could be pretty embarrassing…

Mortgage lending falls at Nationwide after stamp duty rush (The Times, Alex Ralph) highlights the latest Nationwide stats which show that mortgage lending has dropped following the frenzy leading up to April’s stamp duty deadline. As I’ve said on many occasions, everyone’s now waiting to see what’s going to be happening in next week’s Budget!

This is a really funny collection of some amusing London Underground announcements! I wish more people did this! I am in agreement that Bud shouldn’t be allowed on the train though 🤣 That stuff is rubbish!