Author: admin

Authored by Jeremy Portnoy via RealClearInvestigations,

Topline: Eight Massachusetts state agencies and 13 colleges spent $6.8 million to settle grievances, partly in secret, brought by their own employees from 2019 to 2024, according to a Jan. 16 report from State Auditor Diana DiZoglio. 

At least 80 of the 263 settlements contain confidentiality language such as a nondisclosure agreement — to keep certain details confidential between the two parties — which the audit claims is banned by state guidelines. 

Key facts: The Massachusetts Port Authority transit agency was responsible for 11 of the settlements, costing taxpayers $1.7 million. Most of the money came from a $1.4 million settlement in 2022 with an employee who alleged they were denied a promotion because of their gender. The details are sealed by an NDA.

Six of the confidential settlements involved alleged sexual harassment, and two involved alleged racial discrimination. Most of the others were about violations of collective bargaining agreements and employees who were fired without cause.

NDAs were seemingly used on an arbitrary basis. None of the colleges and state agencies included in the audit had a written policy explaining when confidentiality language should be used, except the inspector general’s office.

“By not having a documented policy on the use of confidentiality language in state employee settlement agreements, there is a risk that confidentiality language may be abused to cover up harassment; discrimination; or other inappropriate, unlawful, or unethical behaviors, potentially allowing perpetrators to continue to remain in their positions and engage in further inappropriate, unlawful, or unethical behavior,” auditor DiZoglio wrote.

All of the colleges and state agencies receive legal assistance from the state attorney general’s office. The office’s guidelines prohibit nondisclosure agreements, and the attorneys told auditors that all state agencies were made aware of the guidelines. 

DiZoglio argued that the NDAs may not even be enforceable. In June 2013, Suffolk County Superior Court sided with the Boston Globe newspaper in ruling that settlements between state agencies and their employees are public records.

Search all federal, state and local salaries and vendor spending with the world’s largest government spending database at OpenTheBooks.com. 

Background: The audit is a follow-up to a 2025 report that found 75 state agencies had spent $41 million on more than 2,000 employee settlements from 2010 to 2022.

Summary: Massachusetts’ NDAs hurt the public twice. They essentially use taxpayer funds to cover up potentially unethical behavior perpetrated using taxpayer funds.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

• The Pentagon is reportedly about to cut ties with Anthropic, makers of Claude, which is already embedded in classified systems

• The company insists on implementing guardrails over how the US military can use Claude – specifically when it comes to mass surveillance and autonomous weapons – after it was used in the Maduro raid without their knowledge.  

• The Pentagon is now calling Claude a threat to national security

• Some are accusing the overwhelmingly left-leaning company of trying to undermine the Trump administration, while Elon Musk says Claude ‘hates whites, Asians, heterosexuals, and men.’

Defense Secretary Pete Hegseth is reportedly “close” to cutting business ties with Anthropic and designating the firm a supply chain risk – a penalty typically reserved for foreign adversaries, a senior Pentagon official told Axios.

Anthropic’s flagship model, Claude, is already embedded in the military’s classified systems – however the company’s CEO has been pushing for abstract guardrails over ethical concerns for what the government sees as urgent national security needs. 

If classified as a national security risk, the designation would force any company that wants to do business with the U.S. military to certify it does not use Anthropic’s AI – effectively blacklisting the firm from large swaths of the defense ecosystem.

“It will be an enormous pain in the ass to disentangle,” the senior official told Axios. “And we are going to make sure they pay a price for forcing our hand.”

Chief Pentagon spokesman Sean Parnell confirmed the review, framing it as a matter of national security.

“Our nation requires that our partners be willing to help our warfighters win in any fight,” Parnell said. “Ultimately, this is about our troops and the safety of the American people.”

Claude was notably used during the January operation targeting Venezuelan leader Nicolás Maduro, highlighting how deeply embedded the software already is within U.S. defense operations. As Axios noted on Saturday: 

 The tensions came to a head recently over the military’s use of Claude in the operation to capture Venezuela’s Nicolás Maduro, through Anthropic’s partnership with AI software firm Palantir.

• According to the senior official, an executive at Anthropic reached out to an executive at Palantir to ask whether Claude had been used in the raid.
• “It was raised in such a way to imply that they might disapprove of their software being used, because obviously there was kinetic fire during that raid, people were shot,” the official said.

Since then, Pentagon officials and Anthropic executives have been locked in contentious negotiations over how the military may use the AI, particularly in surveillance, intelligence collection, and weapons development.

Anthropic CEO Dario Amodei has pushed for guardrails to prevent mass surveillance of Americans or the use of AI in fully autonomous weapons systems without human involvement, however the Pentagon says those restrictions are unworkable. Anthropic’s own Acceptable Use Policy (UAP) explicitly prohibits the use of Claude for: 

• The design or use of weapons
• Domestic surveillance
• Facilitating violence or malicious cyber operations

These restrictions are not waived for military/government users unless the contract includes specific safeguards that Anthropic judges adequate, however defense officials insist that military AI tools must be available for “all lawful purposes,” arguing that real-world operations are riddled with gray areas that rigid rules cannot anticipate. The same standard is being demanded of other major AI labs, including OpenAI, Google, and xAI.

One source familiar with the talks said senior defense officials had grown increasingly frustrated with Anthropic – and seized the opportunity to escalate the dispute publicly.

Musk piles on – ‘evil’ and ‘misanthropic’

As the Pentagon showdown escalated, Anthropic also found itself under fire from another powerful adversary – Elon Musk.

Earlier this month, Musk launched a blistering public attack after the company announced a massive $30 billion funding round valuing it at roughly $380 billion. Musk labeled the company’s AI “evil” and “misanthropic,” accusing Claude of ideological bias and hostility toward certain demographic groups, accusing it of “hating Whites, Asians, heterosexuals, and men” in its outputs. 

Musk – whose own company xAI competes directly with Anthropic – mocked the firm’s name, suggesting that a company branded as Anthropic had paradoxically become anti-human.

Your AI hates Whites & Asians, especially Chinese, heterosexuals and men.

This is misanthropic and evil. Fix it.

Frankly, I don’t think there is anything you can do to escape the inevitable irony of Anthropic ending up being Misanthropic. You were doomed to this fate when you…

— Elon Musk (@elonmusk) February 12, 2026

That said, in January Anthropic cut off xAI’s access to Claude models, which xAI engineers had been using via the Cursor coding tool to speed up internal work. Anthropic enforces a strict policy against using its models to build/train competitors (they had done the same to OpenAI earlier). Musk’s co-founder Tony Wu (who just left) sent an internal note acknowledging the productivity hit but saying it would motivate xAI to build better tools, while Musk later called the cutoff “not good for their karma.”

Musk’s beef isn’t baseless; tests and user reports show Claude often declines queries that could be seen as offensive or non-inclusive (e.g., jokes about certain demographics, historical hypotheticals).

To check for the inner woke programming of Claude and Gemini.

In earlier tests where a hospital triage was used as an example. Claude valued the life of a white man as 1/23 important as a black woman. (I.e. one black woman is more valuable than 23 white men)

— Edward Northman (@EdwardNorthman) December 10, 2025

Musk has positioned xAI’s Grok as a less restricted, “truth-seeking” alternative to what he and allies describe as overly constrained or ideologically filtered models. Anthropic, by contrast, has built its reputation around “constitutional AI” – a framework designed to impose ethical limits on how its systems behave.

High stakes, limited alternatives

Designating Anthropic a supply chain risk would force defense contractors to rip Claude out of their internal workflows – a massive compliance headache given the company’s reach. Anthropic recently said eight of the ten largest U.S. companies already use its technology.

The Pentagon contract at risk is valued at up to $200 million – small compared to Anthropic’s reported $14 billion in annual revenue, but symbolically enormous.

Complicating matters, a senior administration official acknowledged that competing AI models are still “just behind” Claude when it comes to specialized government and classified applications, making an abrupt transition risky.

Still, Pentagon officials appear confident that other AI providers will ultimately agree to the “all lawful use” standard, even as sources close to the negotiations say much remains unsettled.

New research published in JAMA reveals a strong reason to feel even better about being three to four espressos deep before the cash market opens in New York. 

Here’s the short version of the findings:

• Caffeinated coffee was linked to lower dementia risk. Comparing the highest vs lowest consumption groups, the study reported a hazard ratio of 0.82 (95% CI, 0.76 to 0.89), which means higher caffeinated coffee intake was associated with lower risk.

• People also reported less subjective cognitive decline. The higher-intake group had 7.8% prevalence vs 9.5% in the lower-intake group (prevalence ratio 0.85).

• The “sweet spot” looked moderate. The most pronounced differences showed up around 2 to 3 cups per day of caffeinated coffee.

• Decaf did not show a significant association with dementia risk.

The long-running study, led by researchers from Mass General Brigham, Harvard T.H. Chan School of Public Health, and the Broad Institute of MIT, tracked 131,821 U.S. adults for four decades and documented 11,033 dementia cases. One major finding was a very clear pattern: adults who drank about three cups of coffee per day, or one to two cups of tea, had a much lower risk of dementia and more favorable cognitive outcomes over their lifetimes. Decaf, however, did not show the same relationship.

Both male and female participants who drank more than three cups of caffeinated coffee per day had an 18% lower risk of dementia compared with those who reported little or no daily caffeinated coffee consumption.

“When searching for possible dementia prevention tools, we thought something as prevalent as coffee may be a promising dietary intervention – and our unique access to high-quality data through studies that have been going on for more than 40 years allowed us to follow through on that idea,” said senior author Daniel Wang, associate scientist with the Channing Division of Network Medicine in the Mass General Brigham Department of Medicine and assistant professor at Harvard Medical School.

Wang noted, “While our results are encouraging, it’s important to remember that the effect size is small and there are lots of important ways to protect cognitive function as we age. Our study suggests that caffeinated coffee or tea consumption can be one piece of that puzzle.”

The cognitive upside of caffeinated coffee is clear.

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Authored by Jeffrey Jones via Gallup,

Gallup estimates that 9% of U.S. adults personally identify as lesbian, gay, bisexual, transgender or something other than heterosexual. This percentage is essentially unchanged from last year but remains more than double the 3.5% from 2012, the first year Gallup measured LGBTQ+ incidence. The current figure is also higher than readings of roughly 7% between 2021 and 2023.

The latest results are based on combined data from 2025 Gallup telephone interviews with over 13,000 U.S. adults.

In each poll it conducts, Gallup asks respondents whether they personally identify as heterosexual, lesbian, gay, bisexual, transgender or something else. The vast majority, 86%, say they are heterosexual, while 9% identify with one of the various LGBTQ+ identities and 5% do not give a response.

The largest share of LGBTQ+ adults say they are bisexual, representing more than half of the subgroup and about 5% of the entire U.S. adult population. Meanwhile, 17% of LGBTQ+ adults identify as gay, 16% as lesbian and 12% as transgender, each representing between 1% and 2% of all U.S. adults. Another 6% of LGBTQ+ adults provide another identity, such as queer or pansexual, beyond those included in the survey.

Bisexual identity has consistently been the most common LGBTQ+ identity and has grown sharply since Gallup began measuring lesbian, gay, bisexual and transgender identities as separate categories in 2020. That year, 3.1% of U.S. adults said they were bisexual, compared with the current 5.3%. Other LGBTQ+ identities have also increased over the past six years.

LGBTQ+ Identity Higher Among Younger Adults

As Gallup has previously demonstrated, the recent increase in LGBTQ+ identification in the U.S. is primarily driven by higher rates among those in the younger generations. In the latest data, 23% of adults under age 30 identify as LGBTQ+, compared with 10% of those aged 30 to 49 and 3% or less among those aged 50 and older.

LGBTQ+ identification is also higher among women than men, primarily because women are much more likely to say they are bisexual. The small proportion of U.S. adults who identify as nonbinary gender overwhelmingly identify as LGBTQ+, particularly as bisexual or transgender.

Democrats are much more inclined than Republicans to have an LGBTQ+ identity. This pattern likely results from LGBTQ+ individuals aligning with the Democratic Party, given the two parties’ stances toward same-sex marriage and other gay rights issues.

City residents are more likely than those living in suburban or rural areas to identify as LGBTQ+, while rates are similar among the major U.S. racial and ethnic groups.

All of these demographic subgroups report higher rates of LGBTQ+ identification than in 2012, the earliest Gallup data. Young adults today versus those in 2012 show the largest increases, and the rate has increased much more among women than men. The smallest increases are among Republicans (1.5% in 2012 vs. 1.9% today) and adults aged 65 and older (1.9% in 2012 vs. 2.3% today).

Implications

LGBTQ+ identification has risen sharply over the past decade, mainly because more young adults today, especially young women, are identifying as LGBTQ+. As more members of Generation Z (those born between 1997 and 2012) reach adulthood, the LGBTQ+ percentage should rise further, given that nearly one in four adults in that generation currently identify as something other than heterosexual. This is in contrast to older Americans, among whom LGBTQ+ identification remains relatively uncommon.

The increase to date also reflects larger shares of Americans, especially those in Gen Z and the millennial generation, considering themselves bisexual. Bisexual identification far outpaces gay and lesbian identification among younger adults, but it is on par with gay and lesbian identification among older generations.

Stocks gained, bitcoin tumbled and bonds steadied after Friday’s cool CPI data reinforced expectations that the Fed will cut interest rates on multiple occasions this year. With US markets closed for the Presidents’ Day holiday and mainland China’s markets closed for Lunar New Year holidays, trading was muted on Monday. As of 9:00am ET, futures on the S&P 500 added 0.4% and Europe’s Stoxx 600 index rose 0.4% as banking shares rebounded from a sharp decline last week. German bunds and Treasury futures were steady after US yields touched the lowest since December on Friday.

The path of US interest rates remains in focus following Friday’s slower-than-expected US inflation print as traders fully price a Fed cut in July and the strong chance of a move in June.  

“The backdrop for equities is positive post CPI,” said Andrea Gabellone, head of global equities at KBC Securities. At the same time, there could be “more dispersion ahead as sentiment around key AI-exposed sectors is still very critical,” he added. 

That sentiment was echoed by other strategists seeking to distinguish between AI losers and winners.

A JPMorgan Chase & Co. team led by Mislav Matejka urged caution on stocks at risk of AI-driven “cannibalization,” including software, business services and media companies. Meanwhile, banks are developing baskets to capitalize on the divergence: as we first reported last Thursday, Goldman launched a new basket of software stocks that goes long firms that will benefit from AI adoption, while shorting the companies whose workflows could be replaced.

With AI disruption rippling through markets, a lot will come down to earnings resilience, in particular in the US. 

“When you look at the current earnings season, the companies are showing 13% of growth,” Nataliia Lipikhina, head of EMEA equity strategy at JPMorgan, told Bloomberg TV. “Overall, this is the reason why we continue to be positive on the S&P.”

Later this week, traders will be watching for ADP private payrolls numbers on Tuesday and the minutes from the Fed’s January meeting on Wednesday for a fresh read on the economy.

European stocks gained with bank shares rebounding, after posting their biggest weekly decline since April on worries about disruption from artificial intelligence. The basic resources sector lags, with Norsk Hydro among Europe’s worst performers as both Goldman Sachs and RBC downgrade the stock. Stoxx 600 rises 0.4% to 620.26 with 253 members down, 336 up, and 11 unchanged. Here are some of the biggest movers on Monday: 

• NatWest shares rise as much as 4%, the most since October, as Citi analyst Andrew Coombs raises his price target on the UK bank to a Street-high.
• Seraphim Space shares rise as much as 9.2%, briefly hitting a new all-time high, after the space tech investment firm said the valuations of its four largest holdings increased over the final months of 2025.
• AECI shares rally as much as 6.1%, the most since July, after the South African commercial-explosives maker shared improved 2025 headline earnings per share guidance.
• Orsted shares rise as much as 3.8% after analysts at Kepler raise the recommendation to buy from hold over the Danish renewable energy firm’s outlook, despite ongoing uncertainty for the industry in the US.
• Norsk Hydro shares fall as much as 4.4%, extending Friday’s 5.9% earnings-triggered drop, after being downgraded at Goldman Sachs and RBC over disappointments and pricing pressures in the Norwegian aluminum company’s downstream business.
• Galderma shares slip as much as 2.2% after naming Luigi La Corte as its new chief financial officer following the news back in July that Thomas Dittrich was departing.
• Pinewood Technologies shares tumble as much as 32%, the most since April 2024, after Apax Partners said on Friday it will not proceed with a possible cash offer for the car dealership software provider.
• FlatexDEGIRO shares drop as much as 7.2% after BNP Paribas downgraded the online brokerage firm to neutral from outperform, saying the price reflects too much optimism about its market position in Germany.
• Maurel & Prom shares slump as much as 12%, pulling back after ending last week at a 2015-high, after announcing it is not currently authorized to resume oil and gas operations in Venezuela.
• Barratt Redrow shares fall as much as 3.7%, leading a drop in British homebuilders after Rightmove said house prices are stalling.

Asian stocks slipped for a second day, led by declines in Japan as traders booked profits after last week’s post-election rally. Several markets were closed or held shortened trading sessions for the Lunar New Year holiday. The MSCI Asia Pacific Index was down 0.1%. Japan’s Topix Index fell 0.8%, with Mizuho Financial Group Inc. and Toyota Motor Corp. among the companies contributing to the index’s losses.In Hong Kong, AI model developer Minimax Group Inc. surged as much as 30% to more than four times its original listing price, while competitor Knowledge Atlas JSC Ltd. ended 4.7% higher. The market will be closed until Thursday. As investors across the region begin to reevaluate their bets on its artificial-intelligence-driven rally, traders in Japan cashed in gains driven by expectations of Prime Minister Sanae Takaichi’s proactive spending policies last week.Trading in Singapore ended early Monday and will be shut until Wednesday. Equity markets in mainland China, South Korea, Indonesia and Vietnam were closed. 

In FX, the yen is the notable mover in currencies, weakening 0.5% against the dollar and pushing USD/JPY back above 153. The offshore yuan is one of the better performers against the greenback. The Bloomberg Dollar Spot Index rises 0.1%.

There is no cash trading in Treasuries due to the Presidents’ Day holiday. European government bonds are little changed

In commdities, gold dipped below $5,000 an ounce, as traders booked profits from a gain in the previous session. Bitcoin tried anf ailed to stage a modest rebound; it last traded around $68,275 after posting its fourth consecutive weekly loss, with the cryptocurrency struggling to find clear direction as a weekend rally fizzled once the momentum ignition algos emerged.  WTI crude futures tread water near $62.90 a barrel. 

Top Headlines

• President Trump said there will be voter ID rules in the mid-term elections this year, whether Congress approves it or not, and they will present a legal argument in an Executive Order. Furthermore, Trump said he has searched the depths of legal arguments not yet articulated nor vetted on this subject, and they will be presenting an irrefutable one in the very near future.
• Iran says potential energy, mining and aircraft deals on table in talks with US: RTRS
• Pentagon threatened to cut its ties with Anthropic over the company’s insistence that some limitations are kept on how the military uses its AI models: RTRS
• UK eyes rapid ban on social media for under 16s, curbs to AI chatbots: RTRS
• Rampant AI Demand for Memory Is Fueling a Growing Chip Crisis: BBG
• Warner Bros. Weighs Reopening Sale Negotiations With Paramount: BBG
• Companies Are Replacing CEOs in Record Numbers—and They’re Getting Younger: WSJ
• Europe aims to rely less on US defence after Trump’s Greenland push: RTRS
• DOJ Tells Lawmakers Epstein File Redactions Complied With LawL BBG
• For College Applicants, Pressure to Make Summers Count Has Gotten Even Worse: WSJ
• Fed’s Goolsbee (2027 voter) said on Friday that they are still seeing pretty high services inflation, and he hopes they have seen the peak impact of tariffs, while he added that the job market has been steady, with only modest cooling. 
• The Break Is Over. Companies Are Jacking Up Prices Again: WSJ

Trade/Tariffs

• USTR Greer said the US and Ecuador expect to sign a trade agreement in the coming weeks.
• China will waive import value-added taxes on selected seeds, genetic resources, and police dogs through to 2030 to increase agricultural competitiveness and breeding capacity. It was also reported that China will grant zero-tariff access to 53 African nations from May 1st, according to Bloomberg.
• Chinese Foreign Minister Wang Yi told his French and German counterparts that China and the EU are partners, not rivals, while he added that China and the EU should manage differences, deepen practical cooperation and work together on global challenges.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks began the week in the green but with gains limited following a lack of major fresh catalysts from over the weekend and amid thinned conditions owing to holiday closures in the region and North America. ASX 200 traded marginally higher with upside led by tech, although gains are capped by underperformance in the utilities, mining, materials and resources sectors, while participants also digested a slew of earnings releases. Nikkei 225 traded indecisively with the index constrained by disappointing Japanese preliminary Q4 GDP data, which showed the economy returned to growth but failed to meet expectations with GDP Q/Q at 0.1% (exp. 0.4%), and annualised GDP at 0.2% (exp. 1.6%). Hang Seng finished higher in a shortened trading session on Chinese New Year’s Eve but with upside limited by tech weakness amid some confusion after the Pentagon added several companies including Baidu, Cosco, BYD, Huawei, Nio, SMIC, Tencent, and more to a list of Chinese firms aiding the military on Friday, but then withdrew the updated list shortly after it was posted. Furthermore, price action was also restricted by the closure of mainland markets and the absence of stock connect flows, which will remain shut for more than a week. US equity futures kept afloat in quiet trade amid the absence of drivers and participants. European equity futures indicate a mildly positive cash market open with Euro Stoxx 50 futures up 0.1% after the cash market closed with losses of 0.4% on Friday.

Asian Headlines

• Chinese President Xi called for the anchoring of economic growth around domestic demand as its main driver, in a speech during a key policy meeting late last year that was released on Sunday.
• China is to establish a permanent financial support framework to promote rural revitalisation and prevent a slide back into poverty, which represents a shift from transitional aid to long-term support.
• China’s market regulator summoned major online platform companies on Friday, including Alibaba, Douyin and Meituan, while it directed them to comply with laws and regulations, and rein in promotional practices, according to Bloomberg.
• US Secretary of State Rubio and Japanese Foreign Minister Motegi reaffirmed their commitment to deepen bilateral ties.
• Disney (DIS) sent a ‘cease and desist’ letter to ByteDance over Seedance 2.0 and alleged that ByteDance has been infringing on its IP to train and develop an AI video generation model without compensation, according to Axios. It was later reported that ByteDance said it would curb its AI video app following Disney’s legal threats, according to the BBC.
• RBI tightened rules for loans provided to brokers and proprietary firms in an effort to reduce market speculation

FX

• DXY eked slight gains in rangebound trade after a lack of major catalysts and with US participants away on Monday.
• EUR/USD was little changed amid the absence of any major macro catalysts and with light newsflow from the bloc, while comments from ECB President Lagarde and news that the ECB is to make its repo backstop available to other central banks across the world, did little to spur price action.
• GBP/USD held on to most of Friday’s spoils but with price action contained by resistance around 1.3650 and following comments from BoE’s Mann that the UK economy is sluggish and tepid, with consumers spending less due to being scarred by high inflation.
• USD/JPY edged higher and returned to above the 153.00 level in the aftermath of the weaker-than-expected preliminary Q4 GDP data for Japan.
• Antipodeans were mixed with little fresh macro drivers and a lack of tier-1 data from either side of the Tasman.

Fixed Income

• 10yr UST futures traded little changed and held on to last week’s spoils after returning above the 113.00 level in the aftermath of the softer US inflation data, while price action was contained to start the week by the closure of US cash markets for Washington’s Birthday.
• Bund futures lacked demand in the absence of any major catalysts and with light newsflow from the bloc.
• 10yr JGB futures were marginally higher following disappointing preliminary GDP data for Q4, but with gains limited after failing to sustain a brief reclaim of the 132.00 level.

Commodities

• Crude futures were rangebound amid light energy-specific newsflow from over the weekend and after last Friday’s indecisive performance, where attention was on a source report that noted OPEC+ is leaning towards resuming oil output hikes from April, but with no decision made.
• Slovak PM Fico said he has information that the Druzhba pipeline has been fixed after damage in Ukraine, although he believes that supplies to Hungary and Slovakia have become a part of political blackmail.
• Spot gold took a breather after edging higher in the aftermath of the recent softer-than-expected US inflation data, with price action also contained by the holiday closures across Asia and North America.
• Copper futures were subdued, with their largest buyer away for more than a week due to the Chinese New Year/Spring Festival holiday.
• Texas venture-backed startup Hertha Metal vowed mass production of steel with 25% cost savings, which could reduce US reliance on imports.

Geopolitics: Middle East

• US military is preparing for potential operations against Iran that could last for weeks if US President Trump orders an attack and the US fully expects Iran to retaliate, according to sources cited by Reuters.
• US President Trump told Israeli PM Netanyahu during a meeting in December that he would support Israel striking Iran’s ballistic missile program if the US and Iran are not able to reach a deal, according to CBS.
• Iran confirmed that indirect talks between the US and Iran will resume in Geneva on Tuesday under the mediation of Oman, while Iranian Foreign Minister Araghchi left for Geneva on Sunday.
• Iranian diplomat said Iran is open to nuclear deal compromises if the US discusses lifting sanctions, while it was also reported that Iran said potential energy, mining and aircraft deals are on the table in talks with the US.
• Israel’s cabinet approved the proposal to register West Bank lands as ‘state property’, while Palestinians condemned the ‘de facto annexation’ which Peace Now said likely amounts to a ‘mega land grab’.

Geopolitics: Ukraine

• US President Trump said on Friday that Ukrainian President Zelensky is going to have to get moving and that Russia wants to get a deal.
• US Secretary of State Rubio said they don’t know if Russia is serious about finding an end to the war in Ukraine and will continue to test it, while it was reported that he met with Ukrainian President Zelensky on security and deepening defence and economic partnerships.
• Ukrainian drones targeted Russia’s Taman seaport and fuel tanks in the Black Sea region.
• UK and European allies were reported on Friday to be weighing seizing Russian shadow fleet ships and tightening curbs on Russia’s economy.
• French Foreign Minister Barrot said some G7 nations have expressed a willingness to proceed with a maritime services ban on Russian oil, which they hope to include in the 20th sanctions package that they are actively preparing.

Geopolitics: Other

• European Commission President von der Leyen said that they face the very distinct threat of outside forces trying to weaken their union, while she added that mutual defence is not an optional task for the European Union; it is an obligation within their own treaty, and it is their collective commitment to stand by each other in case of aggression.
• Pentagon said the US military struck an alleged drug cartel boat in the Caribbean, which killed three people.

DB’s Jim Reid concludes the overnigt wrap

I hope you all had a good weekend. To stay in Winter Olympics mood the family watched “Cool Runnings” last night. I haven’t seen it for 32 years. Please don’t tell anyone but I had a few tears in my eyes at the end. I blamed it on the hay fever that has now started.

There will be a lot of tears out there in markets for other reasons at the moment. Just two weeks ago, the idea of AI-driven disruption still felt like an abstract, almost academic thought experiment—something we could safely revisit once we had clearer evidence of how AI would be deployed and integrated across the economy. Fast forward 14 days, and markets have wiped out well over a trillion dollars of global equity value on the fear that AI could fundamentally reshape business models and compress profitability across a wide range of industries, including software, legal services, IT consulting, wealth management, logistics, insurance, real estate brokerage and commercial real estate.
For months, my published view has been that nobody truly knows who the long term winners and losers of this extraordinary technology will be. Yet as recently as October, markets were implicitly pricing in a world where almost every tech company would come out a winner. Over recent weeks we’ve seen a more realistic differentiation emerge within tech—but that repricing is now rippling into the broader economy with surprising speed.

Some of the sell off in “old economy” sectors feels overdone to me. But as I argued in our 2026 World Outlook back in November, the real challenge is that even by the end of this year we still won’t have enough evidence to identify the structural winners and losers with confidence. That leaves plenty of room for investors’ imaginations—both optimistic and pessimistic—to run wild. As such big sentiment swings will continue to be the order of the day.

My instinct is that the reaction in things like commercial real estate, for example, has been particularly exaggerated. Markets seem to be extrapolating a scenario in which vast numbers of white collar workers are made redundant almost overnight, leading to a dramatic collapse in office demand. If that view turns out to be correct, we’ll be facing societal challenges far larger than anything currently being priced into equities. While trying to catch a falling knife may be too risky for many, beginning to cushion the descent could be sensible in many old economy sectors. Markets can’t sustain a disruption narrative across multiple sectors for months or quarters without concrete evidence — and that evidence is likely to take much longer to emerge. Fascinating times.

As for this week, today is a US holiday but inflation will remain in the spotlight at a global level after Friday’s slightly softer US CPI which helped contribute to a decent rates rally to end the week. Prints are due in the US (PCE – Friday), the UK (Wednesday), Canada (Tuesday) and Japan (Friday). Other economic highlights will include the FOMC minutes (Wednesday), Q4 GDP in the US (Friday), as well as the global flash PMIs (Friday). Earnings reports will feature Walmart (Thursday), Nestlé (Thursday) and BHP (today). It’s the earnings calm before next week’s Nvidia storm.

In the US, this holiday shortened week (President’s Day today) features a data calendar dominated by releases that were pushed back by last year’s government shutdown. The most consequential updates will land on Friday, when the advance estimate of Q4 GDP arrives alongside December’s personal income and consumption figures—key inputs for shaping expectations for the early part of this year.
Our economists expect real GDP growth to slow to 2.5% for Q4, a meaningful step down from the prior quarter’s 4.4% pace. A sizable portion of that deceleration—roughly 70bps—reflects the drag from the record long shutdown. Net trade is once again projected to make a strong positive contribution, driven mainly by subdued imports. December’s international trade report, due Thursday, will help refine the team’s call, as will the advanced goods trade data, which will also guide expectations for inventories—currently seen subtracting about 60bps from growth in Q4.

For markets assessing the underlying pulse of demand heading into 2026, private final sales to domestic purchasers (PFDP) will carry more weight than the headline GDP print. This indicator—closely monitored by Fed Chair Powell—is expected by our economists to slow to 2.0% from 2.9% in Q3, though risks appear tilted upward. One swing factor: Wednesday’s durable goods report, where modest gains outside of transportation could soften the deceleration. On the consumer front, real PCE growth is expected to cool to 2.5% after two quarters of outsized strength but should still signal ample momentum heading into the new year.

Friday’s income and spending report will also offer the latest reading on core PCE, the Fed’s preferred inflation gauge. Our economists expect another 0.4% monthly increase for December, lifting the year over year rate to 2.9%. Updated seasonal factors from last week’s CPI release suggest some mild downward pressure on inflation trends in the second half of 2025. Still, January’s CPI data, although softer than we anticipated, do not translate into equivalent relief for core PCE—in fact, our team currently sees another 0.4% gain for January’s release (delayed until March 13th). Depending on the strength of medical services, airfare, and portfolio management components in the upcoming PPI report, a 0.5% monthly rise cannot be ruled out, which would push the year over year rate toward 3.1%. So don’t get too excited about the softer CPI last week and the huge rates rally.

Additional releases this week will help clarify whether recent severe winter weather has disrupted factory sector activity. January industrial production, due Wednesday, should benefit from a jump in utility output, while weather effects may weigh on the Empire State Survey tomorrow and the Philadelphia Fed survey on Thursday.

Labor market data will also be in focus, particularly Thursday’s jobless claims, which line up with the survey week for the February employment report. As our economists have pointed out, private nonfarm job gains have averaged 103k over the past three months, slightly above the pace at this point in 2025 and matching the start of 2024. See their latest US employment chartbook here.

This week will also feature a dense lineup of Federal Reserve speakers which you can see alongside all the key global data in the day-by-day week ahead calendar at the end as usual.

Moving away from the US, inflation will also be in focus in Japan (Friday) and Canada (tomorrow). For the former, our Chief Japan Economist sees the January nationwide CPI showing a slowdown in both core CPI inflation ex. fresh food to 2.1% YoY (+2.4% in December) and core-core CPI inflation ex. fresh food and energy to 2.7% (+2.9%). Also important will be the global flash PMIs due on Friday as a health check on global growth. In Europe, the spotlight will be on UK inflation (Wednesday), with labour market data due tomorrow and retail sales on Friday. Our UK economist expects headline CPI inflation to drop to 3.0% YoY (3.4% in December) and core CPI also landing at 3.0% YoY (3.2% YoY). See more in his full preview here. In terms of key rate decisions, the RBNZ are expected to remain on hold on Wednesday.
In Asia this morning, things are relatively quiet with mainland Chinese and Korean markets closed for the Lunar New Year. The Hang Seng is up +0.52% while the Nikkei (+0.11%) is edging up after a lower start to its session. That came despite a decent downside miss on Japan’s Q4 GDP data overnight, which rose at an annualised pace of +0.2% versus expectations of +1.6%. S&P (+0.15%) and Nasdaq (+0.06%) futures are also a little higher on this US holiday session.

Finally, the Munich Security Conference wrapped up over the weekend, where key topics included Ukraine, Russia, and the fate of Greenland. And while US Secretary of State Marco Rubio’s speech was nothing like Vice President JD Vance’s at last year’s conference, which triggered a “wake-up” call for European leaders, Rubio reiterated the administration’s view that Europe needed to leave behind its focus on energy policies, trade and mass migration.

Recapping last week now, the tech volatility that has dogged markets since the start of the month broadened into a far more indiscriminate sell-off. The trough came on Thursday, marked by a sharp drop in software stocks, but the weakness extended well beyond tech. Companies across wealth management, real estate and financials suffered double digit declines, underscoring how widespread the pullback has become. Market breadth confirmed this shift as the equal weighted S&P 500 fell -1.37% on Thursday, though it managed to finish the week up +0.29% (+1.04% on Friday). Ultimately, the sell-off left the major US indices on the back foot: the S&P 500 slipped -1.39% (+0.05% on Friday), the Nasdaq lost -2.10% (-0.22% on Friday), and the Magnificent 7 slid -3.24% (-1.11% on Friday).

Although the AI scare dominated sentiment, a heavy slate of US data also shaped the market narrative. Early in the week, softer prints—including flat December retail sales, a dovish Q4 Employment Cost Index, and slower Q4 growth expectations from the Atlanta Fed—pushed Treasury yields lower across the curve. That picture shifted midweek after a stronger than expected January jobs report, which delivered the largest gain in nonfarm payrolls (+130k vs. +65k expected) since December 2024 and reinforced confidence that the US economy carried solid momentum into 2026. Then on Friday, January CPI came in below expectations, adding another dovish note. Although the data offered mixed signals at times, the overall takeaway was sufficiently dovish for traders to increase the number of expected rate cuts by December 2026 to 63.4bps (+7.7bps on the week). This helped drive the largest weekly drop in the 10 year Treasury yield since August 2025, down -15.8bps (-5.0bps on Friday) to 4.05%. The 2 year yield also moved sharply lower, falling -8.9bps to 3.41% (-4.8bps on Friday), its lowest level since 2022.

European markets, meanwhile, delivered a comparatively resilient performance. The STOXX 600 (+0.09%, -0.13% Friday), DAX (+0.78%, +0.25% Friday) and FTSE 100 (+0.74%, +0.42% Friday) all posted modest gains for the week. European sovereign bonds rallied as well, with the 10 year bund yield dropping -8.7bps—its steepest weekly decline since April 2025. That move was outpaced by gilts, which fell -9.8bps (-3.6bps on Friday) despite a sharp early week sell-off triggered by renewed questions surrounding Prime Minister Keir Starmer’s position.

Elsewhere, performance was mixed. Brent crude edged down -0.44% (+0.34% on Friday), while gold extended its upward run, rising +1.56% (+2.43% on Friday).

Will London’s half term week finally give us a quiet week in 2026? You’d probably have to guess at ‘unlikely’.

Around 8:00 a.m. ET, users on Downdetector reported outages and disruptions on X across the United States. At the same time, the outage tracker also showed a spike in reported issues involving Amazon Web Services and Cloudflare.

Downdetector users reported X outages and disruptions across major U.S. cities.

Simultaneously, Downdetector users reported outages affecting AWS and Cloudflare, raising the question of whether issues on Musk’s platform are a downstream effect.

*Developing…

Months after Ukraine was shaken by a sweeping corruption probe into state nuclear giant Energoatom, and subject of international embarrassment given it even touched Zelensky’s office, former Energy Minister Herman Halushchenko has now been formally charged – after authorities detained him while he was allegedly attempting to leave the country.

Halushchenko had been suspended by Zelensky in mid-November, when news of the scandal first hit global headlines. On Monday, Ukraine’s National Anti-Corruption Bureau (NABU) and the Specialized Anti-Corruption Prosecutor’s Office (SAPO) announced that Halushchenko faces formal charges of money laundering and participation in a criminal organization tied to what investigators call the Midas case or Operation Midas.

“The former minister of energy (2021–2025) has been exposed for money laundering and participation in a criminal organization,” the joint statement said, adding that investigators have “expanded the circle of suspects.”

The investigation is focused on members of the alleged network which established an investment fund in Anguilla (the British Overseas Territory in the Eastern Caribbean) in February 2021. The vehicle was marketed as raising roughly €118 million in “investments” – with Halushchenko’s family listed among the contributors – after which millions flowed directly into accounts controlled by the family. 

For example, authorities claim part of the funds paid for the education of Halushchenko’s children at elite Swiss institutions, while other sums were deposited into his ex-wife’s accounts, also with a big portion of the money allegedly invested further, “earning extra income for the family’s personal use.”

Halushchenko was energy minister from 2021 to 2025 before being appointed justice minister in July 2025. In November, NABU agents conducted raided offices and properties connected to him as the investigation intensified.

Western mainstream media had almost immediately launched into damage control in the wake of the massive energy scandal, with one op-ed in Bloomberg having tried its best to say it’s not at all Ukraine’s fault, but is actually somehow… the Kremlin behind it(!). Here’s how it began:

There are at least two legitimate responses to allegations that a group of highly placed Ukrainian officials have skimmed $100 million from contracts to repair and protect their nation’s critical energy infrastructure, even as Russian attacks plunge the nation into darkness and cold. One is to despair, the other to celebrate. The second, strange as it may sound, is more logical.

This episode goes to the heart of why Ukrainians are fighting at all. The war began in 2014, after then President Viktor Yanukovych was toppled by mass protests against the epic scale of his corruption and the captivity to Moscow this created. Graft was the glue with which the Kremlin had held…

So even with high officials in Zelensky’s government are caught red-handed by a Ukrainian internal investigation, the ultimate fault lies in Moscow, according to some MSM accounts.

It must be remembered that earlier last year, Zelensky himself found himself at the center of EU pushback and controversy when he attempted to eliminate NABU’s independence, sparking outrage in Brussels some sectors of the Ukrainian populace.

Ukrainians, currently enduring a harsh winter in subzero temperatures and with rolling power outages due to the war, are outraged. But Americans might also need to wake up and take note of how billions in US funds are going into the coffers of a deeply corrupt Ukrainian system.

Authored by Luis Cornelio via Headline USA,

Detroit Police Chief Todd Bettison said Thursday that officers purportedly collaborating with federal immigration agents will be held “accountable,” as the city defends its so-called “welcoming” status.

Bettison made the comments during a hearing with the Detroit Board of Police Commissioners regarding two incidents, one on Dec. 16 and another on Feb. 9, according to the Detroit Free Press.

“Of our officers, 98-99 percent do it the right way each and every day,” Bettison claimed.

“But I do have one or two percent that decide to violate our rules, our policies and our procedures, and to those officers, I will hold them accountable.”

A “welcoming city” refers to jurisdictions that do not require officers to investigate a person’s immigration status during routine investigations.

By contrast, sanctuary cities refuse to honor ICE detainers and actively decline to cooperate with federal immigration authorities.

In the first incident, a Detroit sergeant reportedly called Border Patrol after an officer requested a translation during a traffic stop of a non-English-speaking individual.

Bettison said that Border Patrol determined the person was not a U.S. citizen and detained the individual as a result.

In the second incident, a Detroit officer allegedly contacted Border Patrol while investigating an individual on a felony warrant.

“Border Patrol did respond, and Border Patrol ultimately took this individual,” Bettison said, citing body-worn camera footage reviewed by the DPD.

The commission is set to decide whether to suspend the officers involved ahead of a Feb. 19 hearing.

US natural gas futures tumbled to a four-month low early Monday as weather models indicate the Lower 48 is exiting the peak of the Northern Hemisphere winter and entering a much-needed warmup. For the Mid-Atlantic and Northeast, which experienced some of the coldest weather in decades, the next few weeks are expected to feel more like spring.

March contracts fell 7.5% to about $3 per mmBtu, the lowest level since October 17 and a roughly four-month low.

Weather forecasts for the Lower 48 show above-normal temperatures through the end of the month, particularly in the central and southern regions.

NatGas prices have been extremely volatile this winter. Multiple cold blasts sparked freeze-offs and production disruptions across gas infrastructure that sent spot NatGas prices sharply higher. At the same time, tightening power markets, especially across the Mid-Atlantic area, sent power prices soaring.

Readers may recall we identified peak Northern Hemisphere winter in early February, as 30-year average temperature trends point to warmer conditions across the Lower 48.

Now the Trump administration can point to last month’s cold snap as a real-world stress test: fossil fuel generation helped keep much of the eastern U.S. grid from collapsing under peak demand. Read the note, titled “Sleep Tight, America. We Got This”: NatGas And Coal Power Plants Prevented Grid Collapse During Historic Winter Blast.

Submitted by Thomas Kolbe

The European Union has lost its place in the global race for artificial intelligence. In a single tweet on platform X, France’s President Emmanuel Macron inadvertently outlined the convoluted situation while simultaneously revealing his personal emotional fragility.

The leading representatives of the European Union like to present themselves as emotionless technocrats. Maintaining the greatest possible distance from citizens, they execute their agenda of societal transformation toward what they understand as a net-zero transformation economy. 

This ostentatious distance from the citizenry acts as a simulacrum of power, which, in politicians like Emmanuel Macron, often veers into the caricatural.

Macron’s striking presence in foreign affairs—whether regarding the Ukraine war or recurring provocations toward the United States—correlates with his aggressive censorship policy toward his own population. A president without a people, steering his minority government through a budgetary crisis that brings France ever closer to the fiscal abyss.

In Macron’s persona, the European misstep is condensed: economically failed, deeply unpopular among his own people, geopolitically essentially irrelevant—and yet imbued with lofty, messianic plans. 

This performative play of power, coupled with hardly disguised impotence and incompetence, inevitably produces an effect that can be described as clownish. It is the expression of a political style that can no longer reconcile claim with reality—and thus delivers less leadership than a tragicomic performance.

A Touch of Emotion

Politicians like the French president are indeed aware of the growing public anger over their policies and, behind the technocratic façade, very much experience emotional states—Macron revealed this for a brief moment on February 7 on the platform “X,” which he otherwise fights.

This moment of exposure was triggered by a reaction to Israeli AI investor Dr. Eli David. The entrepreneur had ridiculed the French government’s plan to initiate an AI revolution with a mere initial investment of €30 million, publicly calling the president a “clown.” 

“This clown wants to make France an AI leader with €30M.”

€30 million → to attract and support around forty top-tier international researchers. They chose France for its values and its commitment to science.

Sometimes it’s too slow…… pic.twitter.com/UHlSpIIaI9

— Emmanuel Macron (@EmmanuelMacron) February 7, 2026

Macron responded in classic social media fashion: fast, unconsidered, emotional. And this was precisely the real revelation. His message not only displayed personal fragility but simultaneously exposed Europe’s fatal economic strategy in the field of artificial intelligence.

Macron directly addressed David’s criticism and slid into a rhetorical trap, writing: Yes, exactly this “clown,” meaning himself, would trigger an investment boom with €30 million, eventually mobilizing over €100 billion in private funds. Macron plans a French Silicon Valley south of Paris and intends to catapult his country to the Olympus of artificial intelligence—with €30 million of state money, initially benefiting those who provide the technological framework for the upcoming rollout of digital IDs.

“This clown wants to make France an AI leader with €30M.”

€30 million → to attract and support around forty top-tier international researchers. They chose France for its values and its commitment to science.

Sometimes it’s too slow…… pic.twitter.com/UHlSpIIaI9

— Emmanuel Macron (@EmmanuelMacron) February 7, 2026

In this sentence, Europe’s dilemma crystallized: self-assurance and denial, the familiar pathos of EU Europeans combined with an astonishing detachment from reality—and a political style that reveals more about Europe’s position in the global AI race than any sober analysis could.

Those familiar with the codes, memes, and recurring keywords of digital platforms understand the significance of this label. When “clown world” or “clown politics” is mentioned, it refers precisely to the comedy we witness daily: the routine evasion of European top politicians from the consequences of their centrally controlled policies—be it economic and industrial policy, migration, or the grotesquely perceived energy policy.

The clown meme condenses the cynically self-ironic perception of the viewer of this comedy—a viewer aware that they are not only the target of these policies but will ultimately bear their consequences.

Clown politics takes many forms. These include the countless crisis or innovation summits in which politicians stage themselves retroactively as initiators of the new, attempting to position themselves at the forefront of developments they have ignored or actively obstructed for decades. 

These summits are a particularly pernicious form of masking incompetence: political self-validation rituals simulating activity while merely covering up structural stagnation.

Another Lost Year

It has been almost exactly one year since Emmanuel Macron, at the AI conference Choose France, presented his megalomaniac-seeming investment initiative. Over €100 billion in private investment pledges were said to have been mobilized, with asset manager Brookfield promising more than €20 billion, and the UAE sovereign wealth fund with €50 billion, to participate in Macron’s Silicon Valley. To this day—nothing has happened.

As elsewhere in the EU, a Kafkaesque thicket of regulation seriously blocks private-sector engagement. At least France could score points thanks to nuclear power: stable, cheap, ideal for energy-hungry data centers. And Germany? Its locational advantage has been squandered in green delusions. Yet France remains trapped in paralyzing stagnation—announcements fade, visions fizzle, and the digital Silicon Valley appears like an illusion from the bureaucratic dream factory.

The contrast with the United States could hardly be starker. There, around $400 billion in private investments in artificial intelligence and data centers were mobilized last year alone. The infrastructure of the data economy of the future is being built in the United States, where President Donald Trump deregulates markets, cuts taxes, and promotes the comeback of nuclear energy.

Notably, major US data center operators—from Meta to Google—have already begun investing in their own energy sources. This not only stabilizes their business models but also the American energy grid. It is an impressive counterpoint from the private sector to Brussels’ statist economic model, where technological ignorance seems almost cultivated.

Europe’s idea of state seed funding and centrally planned market regulation is the real problem. 

European society has drifted too far from the principles of market economy, personal responsibility, and a general culture of initiative in business. Bureaucracy, green socialism, and the decades-long cultural struggle against bourgeois values and roots now bear their rotten fruits. The spirit of EU bureaucracy has warped the perception of economic reality for citizens, entrepreneurs, and the political class alike.

New technologies and innovations are no longer understood as opportunities but as reasons to defensively secure the status quo. This psychopolitical consequence of European bureaucratization weighs like lead on the prosperity and productivity of European economies—with consequences that even French presidents in combative cynic mode on “X” cannot hide.

* * * 

About the author: Thomas Kolbe, a German graduate economist, has worked for over 25 years as a journalist and media producer for clients from various industries and business associations. As a publicist, he focuses on economic processes and observes geopolitical events from the perspective of the capital markets. His publications follow a philosophy that focuses on the individual and their right to self-determination.