Snowballing.
A staggering shift.
“I can’t do my job without News Items.” — Jim Cramer.
1. Bloomberg.com:
Ordinary Americans are helping throw lifelines to private equity funds.
The insurance and annuity arms of Wall Street powerhouses including Apollo Global Management Inc., Ares Management Corp. and the Carlyle Group Inc. rank among the most active providers of an esoteric type of financing once dominated by banks and specialist lenders, according to market veterans handling the private deals.
Apollo’s Athene insurance unit alone has pumped roughly $18 billion this year into funding the debts known as NAV loans, in which fund managers post their investments — or net asset value — as collateral.
Buyout funds can use the money to shore up portfolio companies, redeploy it into new deals or seed new funds. Some loans enable payouts to investors who’ve been waiting for years to recoup stakes in hard-to-sell assets.
A relatively obscure niche before the pandemic, NAV lending has been gaining momentum the past few years and is now snowballing. The roughly $225 billion of NAV loans outstanding will probably double in the next two years and surge as much as sixfold by 2030, according to Kevin Alexander, co-head of alternative credit at Ares. (Read the rest. Source: bloomberg.com)
2. Eurointelligence:
There are many tail risks policymakers and investors have to juggle at this moment. A big one is the arrival of a omni-financial crisis. A tech stock market crash in the US, a sovereign debt crisis in Europe, and a financial meltdown in China – all happening at the same time, feeding each other.
Such a scenario is not implausible. We had a bit of a mini-wobble for tech stocks this week. Some of the valuations are clearly not sustainable. The difficulty for investors is to determine the exact sources of value in the tech sector. For global macro people like ourselves, it is easy to say that AI will have a massive impact on productivity in countries that participate in 21st century technologies. But there are no proprietary technologies. We could be a single algorithm away from a collapse in the Nvidia share price. If somebody manages to reduce the number of calculations in a deep learning model by a significant degree, we will no longer need those data gigafactories that everybody is building right now. OpenAI is still the global leader in large-language models, but as China’s Deepseek has shown us, this is not a monopoly, and it can be done at lower cost. It is possible to have an AI revolution and an AI bubble at the same time. The fall in the Bitcoin price from a peak of almost $125,000 to $90,000 now is perhaps a warning sign that investors are starting to pull out of risky assets. (Source: eurointelligence.com. Italics mine.)
3. Bloomberg.com:
Tsinghua University professors and students are quietly accumulating massive amounts of intellectual property. They already had more AI research papers among the 100 most cited than any other school at last count, and they receive more patents each year than MIT, Stanford, Princeton and Harvard combined. Tsinghua collected 4,986 AI and machine learning patents between 2005 and the end of 2024, including more than 900 last year, according to the data analytics service LexisNexis. Overall, China now accounts for more than half of all active patent families globally in those fields.
“This is a staggering shift in innovation in less than a decade, and it reflects China’s concerted drive to become an AI superpower,” said Marco Richter, LexisNexis’s Bonn-based senior director of IP Analytics and Strategy. (Source: bloomberg.com)
4. Google launched Gemini 3 yesterday, a new series of models the company says is its “most intelligent” and “factually accurate” AI systems yet. They’re also a chance for Google to leap ahead of OpenAI following the rocky launch of GPT-5, potentially putting the company at the forefront of consumer-focused AI models. For the first time, Google is giving everyone access to its new flagship AI model — Gemini 3 Pro — in the Gemini app on day one. It’s also rolling out Gemini 3 Pro to subscribers inside Search. (Sources: blog.google, theverge.com)
5. Silicon Valley is in the midst of an unprecedented artificial intelligence boom, pouring billions of dollars into developing the technology. But despite soaring revenue and record AI investments, companies continue to slash jobs. Technology firms have announced more than 141,000 job cuts so far this year, according to outplacement firm Challenger, Gray & Christmas, a 17 percent increase from the same period last year. In the past two years, the tech workforce has shrunk nationwide by about 3 percent a year, with California posting a much steeper 19 percent drop, according to data from the U.S. Bureau of Labor Statistics. (Source: washingtonpost.com)
6. For much of the AI boom, many companies shied away from attributing job cuts to artificial intelligence for fear of attracting negative headlines. But in recent months, large firms across industries and geographic regions have become more vocal with claims that AI is allowing them to eliminate staff and reduce hiring. In earnings reports, investor presentations and company memos, executives have been touting efficiency gains from artificial intelligence and framing a shrinking or flat workforce as preparation for an increasingly AI-driven economy. (Source: bloomberg.com)
7. Ford Motor CEO Jim Farley told a podcast last week that he can’t find enough skilled mechanics to run his auto plants. Specifically, Ford can’t fill 5,000 mechanic jobs that pay $120,000 a year. “We are in trouble in our country. We are not talking about this enough,” Mr. Farley said. “We have over a million openings in critical jobs, emergency services, trucking, factory workers, plumbers, electricians and tradesmen.” He said Ford is struggling to hire mechanics at salaries that Ivy League grads might envy. (Source: wsj.com)
8. The Wall Street Journal:
Government subsidies for college and graduate education have encouraged the young to go to college even though they might be better off learning a trade. This has created a skills mismatch in the labor market. Unemployment among young college grads is increasing, while employers struggle to hire skilled manufacturing workers, technicians and contractors.
Only 114,000 Americans in their 20s completed vocational programs during the first 10 months of last year, compared to 1.24 million who graduated from four-year colleges and 405,000 who received advanced degrees. Yet recent bachelor’s recipients in their 20s were 5.6 percentage points less likely to be employed than those who finished vocational programs.
The National Federation of Independent Business reported this month that one third of small business owners reported jobs they couldn’t fill, and 49% reported few or no qualified applicants for positions they were trying to fill. Twenty-seven percent cited labor quality as their most important problem. (Source: wsj.com)
9. The Economist:
Today, less than 1% of global (and American) energy comes from geothermal. But researchers at Princeton University predict that technical innovations mean widely available geothermal power could produce nearly triple the current output of the country’s nuclear power plants (which supply roughly 20% of America’s electricity at present) by 2050. The International Energy Agency envisions a $1 trillion global investment boom by 2035.
The optimism is a combination of market pull and technology push, says Milo McBride of the Carnegie Endowment, a think-tank. Because geothermal power can offer clean energy around the clock, it is a perfect match for the incessant power-guzzling of data centres. That explains why Google, Meta and other purveyors of artificial intelligence keen on carbon-free but “firm” power are investing heavily in geothermal innovations. (Source: economist.com)
10. In a stinging setback for President Donald Trump and Republicans, a federal court on Tuesday blocked a newly drawn congressional map in Texas that Republicans hoped would have given them an edge in five more House seats. In a 2-1 ruling, a judicial panel issued a preliminary injunction blocking the new map and found the state had to instead use the map it drew in 2021. The ruling is a major victory for Democrats because it will likely allow them to hang onto five seats in next year’s midterm elections. Texas Gov. Greg Abbott (R) said the state would quickly appeal to the Supreme Court. (Source: washingtonpost.com)
11. As the most significant corruption scandal of Mr. Zelensky’s tenure unfolds, opponents who had lain low are coalescing into the first major anti-Zelensky movement since the invasion began in 2022. These adversaries include Ukraine’s independent anticorruption agencies, opposition parties, political activists and media outlets. With….the gloves now off, Mr. Zelensky’s critics are speaking in once-unthinkable terms, including accusing presidential allies of betraying the country. Many Ukrainians have reacted with disgust to accusations that his allies enriched themselves while the country’s soldiers are dying in a fight for national survival. (Source: nytimes.com)
12. Iranian scientists and nuclear experts made a second covert visit to Russia last year, in what the US claims has been a push to obtain sensitive technologies with potential nuclear weapons applications. The previously undisclosed trip was part of a series of exchanges between Russian military research institutes and the Organization of Defensive Innovation and Research (SPND), an Iranian military-linked unit that the US accuses of leading Iran’s nuclear weapons research. The meetings, referenced in documents obtained by the Financial Times, represent the first evidence of Moscow’s apparent willingness to engage with Tehran over knowledge potentially relevant to nuclear weapons. The FT corroborated the documents through corporate filings, sanctions designations, leaked travel data and other correspondence. (Source: ft.com)
13. Since the collapse of the Assad regime on Dec. 8 last year, ordinary Syrians are reporting mass graves that had long been an open secret. Other cadavers have been discovered by chance, as Syrians sift through the rubble of bombed buildings and reclaim farmland disused during the war. The gravesites range from vast fields holding tens of thousands of victims of industrial-scale killing to smaller plots containing dozens of bodies. The International Center for Transitional Justice and the Syrian group Lawyers and Doctors for Human Rights has so far counted 134 mass graves throughout the country. Former Syrian president Bashar al-Assad is currently living in luxury exile in Moscow. (Sources: wsj.com, fastcompany.com)
14. Trump has already concentrated about 10 per cent of the entire US Navy in the Caribbean, including guided missile destroyers, a nuclear-powered attack submarine and two amphibious assault ships. This formidable force has just been strengthened by the arrival of the USS Gerald R Ford, the world’s biggest aircraft carrier, having steamed westwards across the Atlantic at the head of a naval strike group. The primary target of this military build-up – America’s biggest deployment in the Caribbean since an intervention in Panama in 1989 – is Venezuela’s far-Left and bitterly anti-US regime under Nicolas Maduro, the authoritarian successor to the late Hugo Chavez. But that is not the whole story. Experts believe that Trump, and especially Marco Rubio, the US secretary of state, may see regime change in Caracas as a necessary prelude for what they want most of all, which is regime change in Havana and the final “liberation” of Cuba. (Source: telegraph.co.uk)
15. With the largest U.S. aircraft carrier now positioned in the Caribbean, President Trump has approved additional measures to pressure Venezuela and prepare for the possibility of a broader military campaign, according to multiple people briefed on the matter. Mr. Trump has signed off on C.I.A. plans for covert measures inside Venezuela, operations that could be meant to prepare a battlefield for further action, these people said. At the same time, they said, he has authorized a new round of back-channel negotiations that at one point resulted in President Nicolás Maduro of Venezuela offering to step down after a delay of a couple of years, a proposal the White House rejected. It is not clear what the covert actions might be or when any of them might be carried out. (Source: nytimes.com)
16. A Gustav Klimt painting sold for a historic $236.4 million last night at Sotheby’s first auction in its new home in New York’s Breuer building, making it the world’s most expensive modern artwork at auction and the second-priciest work of art ever auctioned overall. “Portrait of Elisabeth Lederer” is Klimt’s 1914-1916 painting of a woman standing in a shimmering white gown against a periwinkle backdrop, a lush work that now also ranks as the top work ever auctioned off by the 281-year-old auction house. The reigning titleholder remains a $450 million Leonardo da Vinci, “Salvator Mundi,” that Christie’s sold in 2017. (Source: wsj.com)
17. Are there introductory courses for learning about Artificial Intelligence? Answer: Yes. Which one is best? The (rough) consensus seems to be: (1) Andrew Ng’s AI for Everyone (free to audit) and (2) MIT’s AI 101 (free). (Sources: coursera.org, ocw.mit.edu)
Quick Links: The Trump Administration will give Constellation Energy a $1 billion federal loan to restart the Three Mile Island nuclear power plant. Rising electricity demand from data centers is raising the risk of blackouts across a wide swath of the US during extreme conditions this winter. Four-fifths of the world’s population now live in urban areas. Nature’s latest graduate survey: Why PhD students study abroad in 2025. Italy to define non-consensual sex as rape. The time to eat dinner: Ideally between 5.30pm–7.00pm, or at least two to three hours before bedtime. In the state of Washington, birds are giving ‘Yelp reviews’ of forest restoration work. Subscribe to America’s leading ornithology newsletter, Bird News Items.
Financialization Links: AI’s ability to detect subtle patterns in large volumes of financial data can be transformative. The crypto trades that amplified gains are now turbocharging losses. Haass/Kissane: The relationship between the national debt and national security. Japan’s borrowing costs at highest in decades on fears of public spending surge. How baby boomers got so rich. The new economics of publicity rights.
Political Links: The great American credit expansion is only just starting. You may have heard this already: US Congress approves bill to release Jeffrey Epstein files. Despite congressional action, quick release of Epstein files is in doubt. The only ‘no’ vote on releasing Epstein files was cast by Rep. Clay Higgins (R-LA). He explains why. Trump approval falls to lowest of his term over prices and Epstein files, Reuters/Ipsos poll finds. Trump’s relentless fund-raising has been hugely successful. Elon Musk returns to the White House at dinner for Saudi crown prince. Trump says Saudi crown prince ‘knew nothing’ about Jamal Khashoggi’s murder. The Economist: Cuba is heading for disaster, unless its regime changes drastically. Is Mamdani on to something?
Science/Technology Links: Supercomputer creates the most realistic virtual brain ever. In central China, AI is telling humans how to build a high-speed rail tunnel. Dutch government returns control of Nexperia to Chinese owner. Waymo is widening its lead over Tesla in autonomous ride hailing. Elon Musk’s xAI is in advanced talks to raise $15 billion in new equity at a $230 billion valuation. Microsoft and Nvidia to invest up to $15 billion in OpenAI rival Anthropic. Mathematicians say Google’s AI tools are supercharging their research. The authors of ‘AI 2027’ (which is terrifying) and ‘AI as Normal Technology’ (which is encouraging) find common ground. Meta 1, FTC 0: Federal judge rules that Meta’s acquisitions of Instagram and WhatsApp did not illegally stifle competition in social networking. The simple test that blew up the FTC’s case against Meta. Everyday microplastics could be fueling heart disease. Where did you say that rock came from, exactly?
War: Seven contemporary insights on the state of the Ukraine war. Russian partial battlefield air interdiction (BAI) enabled recent Russian advances in Pokrovsk. Russian military commanders continue to order Russian forces to commit war crimes on the battlefield. Doing the same thing over and over again and expecting different results. Israel struggles to curb West Bank violence as settlers ramp up attacks. Ecuador votes no to hosting U.S. military base. Unlikely would be one way to put it: Chinese and US experts agree that AI use in defense sector must be restricted.
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