The ‘invisible kingpin of data centres’ riding the Gulf’s AI boom
Dubai-based Zachary Cefaratti has become a go-to dealmaker who connects Middle Eastern money to Silicon Valley
When an Abu Dhabi artificial intelligence company wanted access to an enormous data centre in France earlier this year, it turned to a former child actor turned investment banker to broker the deal.
Zachary Cefaratti, founder of boutique advisory Dalma Capital, has leveraged an eclectic contacts book that includes OpenAI chief Sam Altman and senior Middle Eastern politicians to become a below-the-radar fixer for data centres, cryptocurrency mining and technology groups in the Gulf.
The 37-year-old’s clients include G42, the AI group chaired by powerful Emirati royal Sheikh Tahnoon bin Zayed al-Nahyan; Abu Dhabi sovereign investor ADQ; and the encrypted social media network Telegram, whose founder Pavel Durov lives in Dubai and was detained and charged in France last year.
According to executives who have worked on transactions with Cefaratti, the Californian is one of a few niche dealmakers to profit from two new trends: the insatiable desire for more computing capacity to run AI, and the Gulf’s desire to fund the nascent technology.
“I’d like to think that I’m more than just riding a wave,” Cefaratti told the Financial Times. “It’s not completely by accident . . . I spend a lot of time thinking about and researching these things . . . not being like most investment bankers, really getting into the tech.”
“He’s an invisible kingpin in data centres,” said Andy Tang, partner at Draper Associates.
Dalma advised companies in the G42 group, including on a “partnership with a tier one hyperscaler”. Microsoft acquired a $1.5bn stake in the Abu Dhabi-based company last year. Cefaratti also sourced the French data centre deal between G42 subsidiary Core42 and France’s DataOne, which closed this year.
This May, Dalma was joint arranger for Telegram’s $1.7bn bond issuance, which was led by Jefferies. Cefaratti had previously arranged meetings for Telegram with Abu Dhabi investors.
For Cefaratti, the UAE’s bet on becoming an AI hub is a natural fit: “AI consumes massive amounts of energy and it’s very capital intensive.” The nation can then become “an exporter of intelligence”.
Cefaratti’s Dubai office features a sculpture of Babar the elephant holding a bag of bitcoin, a gift from the daughter of Dubai property tycoon turned data centre investor Hussain Sajwani. Cefaratti said he counted Binance founder Changpeng Zhao, another UAE resident who served jail time in the US, as a friend.
The AI boom came after Cefaratti suffered a career low. Between 2019 and 2023, he was investigated by the financial centre’s watchdog, which had become stricter after Dubai investment firm Abraaj imploded under its supervision.
He was charged with misleading the regulator, and hit with a $162,500 fine and barred from acting as senior executive officer for two years. The Dubai Financial Services Authority accused him of giving “false, misleading and deceptive information” about trades placed in 2016 on Dalma’s behalf, by a person who was not employed by the fund.
“I think the big mistake I made was not taking it seriously,” said Cefaratti. “It just seemed like such a small thing from so long ago.”
Cefaratti’s early career was as a child actor appearing in shows such as Star Trek: Deep Space Nine, while his grandmother encouraged him to invest his earnings in bonds and shares.
He dropped out of college to care for his father in 2009, starting a small health insurance brokerage business to cover medical bills. He returned to his studies and joined students opening a hedge fund; they were mocked as “Clueless Capital”.
The finance-focused student left an impression on academics at Franklin University Switzerland. Cefaratti was “one of those students you don’t forget”, remarked his former professor Roberto Cordon, saying he would receive emails from Cefaratti at 4am.
Cefaratti headed to the Gulf in late 2012. “I bought what [Dubai was] selling,” he said. “I probably bought it a little too early.” His fledgling hedge fund Dalma Capital managed just a “couple of million dollars”, and local investment never materialised.
Pivoting, Cefaratti used his expensive Dubai International Financial Centre licence as a platform for other funds, including one in cryptocurrency, and later started an investment conference.
In 2018, he decided to expand Dalma into advisory and hired an investment banker from Morgan Stanley.
“We were getting calls from organisations that have huge portfolios of excess energy that they were looking to monetise,” Cefaratti recalled. These clients included ADQ, which Cefaratti steered into mining bitcoin — a way to convert electricity into cryptocurrency.
At about the same time, Cefaratti said he was getting to know Draper Associates, which formally appointed him venture partner in 2023.
As Dubai took off during the Covid-19 pandemic, when it bet on reopening as other cities stayed locked down, Cefaratti said his business finally started to do well. Using venture capital terminology, he said: “That’s when the product market fit aligned.”
In 2022, he took autonomous driving company Pony.ai on a funding roadshow in Saudi Arabia, alongside investment bank Moelis. The investment fund belonging to giga project Neom later announced a $100mn investment in the Chinese group. Work with G42 and others followed.
Dalma has just 21 employees. But according to Cefaratti, he is filling a gap. Clients raising funds could just call a bulge bracket bank, but if they are “putting together a complex deal that has multiple layers, that needs customers and technology; there’s not many one-stop shops that can do that”.
Musk’s $1T pay package is full of watered-down versions of his own broken promises
Tesla has proposed a massive new $1 trillion compensation package for its CEO Elon Musk, and many of the benchmarks he needs to hit are simply watered-down versions of promises he’s spent years making about the company.
That’s not the picture Tesla’s board of directors paints in the company’s annual proxy statement, where they revealed the proposed pay package. Instead, the board focuses on how it plans to create “the most valuable company in history.”
To be sure, if Tesla accomplishes all that it aims for with this deal, it will look like a much different company at the end of the 10-year period it covers. That doesn’t change the fact that the milestones the company is asking Musk to aim for are less ambitious than his own previously-stated goals.
While the unprecedented pay package still needs to be approved by shareholders at a meeting in November, it’s easy to see the company’s fervent fan base voting “yes.” Previous votes on Musk’s compensation have been overwhelmingly approved by Tesla’s shareholders.
With that in mind, let’s take a look at what Musk needs to accomplish in order to receive the full payout.
20 million cars … total
Musk spent years claiming Tesla would be able to make 20 million electric vehicles per year by 2030. This was back when he and his company were still promising to grow at a rate of 50% each year.
But Tesla walked away from those promises as sales growth stalled, and then reversed in 2024. The company then pulled the 20-million-per-year goal from its impact report last year, and stopped building a planned factory in Mexico that would have increased production.
Now, the first “product goal” that Tesla’s board of directors laid out for Musk to achieve on his path to becoming a trillionaire is to deliver 20 million vehicles total. Tesla has already sold eight million cars to date, and even with sales slumping, is moving just shy of 2 million per year.
With the new pay package being laid out over a 10-year period, that means the target has gone from 20 million EVs per year by 2030 to just 20 million total by 2035.
One million robotaxis*
One of Musk’s most infamous and outrageous promises about Tesla came in 2019, when he claimed that the company would have one million robotaxis on the road in 2020. It’s now 2025, and Tesla has only just begun to trial a robotaxi service in Austin, Texas that has, at most, around 20 or 30 cars with safety drivers on board.
To access his full proposed pay package, Tesla is asking Musk to help the company realize an altered version of that promise, as another product goal listed is to have “1 million Robotaxis in Commercial Operation.”
It’s a goal with caveats. The fine print shows that Tesla is only requiring there to be a “daily average aggregate” of one million robotaxis “commercially operated by or on behalf of [Tesla] over a consecutive three-month period, as part of a transportation service.”
Tesla goes on to define “Robotaxi” as any Tesla vehicle, including but not limited to the purpose-built “Cybercab” it’s developing, that is using the company’s Full Self-Driving software to offer rides to people.
This includes customer-owned vehicles, which is another thing Musk has long promised but never delivered. He’s spent years claiming that Tesla could flip a digital switch and turn existing vehicles into fully-autonomous ones, and that owners could add and subtract those vehicles to a larger robotaxi fleet at will.
But Musk has since said many of the Teslas currently on the road don’t have the necessary hardware for the former to happen, and the company has yet to demonstrate the latter. Regardless, Musk now has an even looser timeline to try and make both things happen.
One million “bots”?
Musk sees Tesla’s future being all about the humanoid robot that it’s developing, called Optimus. Just this week he claimed it could make up as much as 80% of the company’s future revenue.
As he became increasingly focused on Optimus, Musk made some pretty wild promises about what that future would look like. One of his core claims was that Tesla will be making one million Optimus bots per year by as early as 2029.
And yet, Tesla’s board is only asking Musk to deliver one million “bots” total as part of this proposed compensation plan. Tesla also defines “bots” as “any robot or other physical product with mobility using artificial intelligence manufactured by or on behalf of the Company” — though the company’s vehicles do not count.
The directors seem to agree that Optimus has “the potential to be Tesla’s bestselling product,” and they say it reperesents “the clearest example of how Tesla has the ability to make autonomy benefit all of humanity.”
But the board also notes that “commercialization plans” for Optimus are “still in development,” and Musk now has until 2035 to reach the one million mark.
Everything else
The fourth and final product goal Musk has to achieve is to notch 10 million active subscriptions to Tesla’s Full Self-Driving (FSD) software. It’s arguably the most ambitious product goal. The company does not say how many current owners have paid for FSD, though executives have recently said the adoption rate is in the “teens.” At best, that means anywhere from a few hundred thousand to the low millions of Tesla vehicles have the software installed.
Everything else Tesla’s board is asking of Musk is tied to money. Ultimately, Musk needs to help Tesla reach an $8.5 trillion valuation in order to unlock the full value of the compensation package and become a trillionaire himself.
Musk already had grand designs to accomplish something similar. He has often claimed that Tesla could one day become more valuable than Apple and Saudi Aramco combined. At their current valuations, those two companies are collectively worth around $5.5 trillion. But earlier this year, the CEO claimed Tesla could be worth more than the next five most-valuable companies combined — which at the time meant he was aiming closer to the $15 trillion mark.
Along with the goal of blowing up Tesla’s valuation, Musk is being asked to increase the company’s earnings to, essentially, $400 billion per year — an enormous figure compared to last year’s earnings of around $17 billion.
Lastly, Tesla’s board has asked for two notable assurances from Musk in order to unlock the full value of the compensation package. One is that he must work with the company to develop a plan for how he will be succeeded as CEO of Tesla (and the plan essentially locks him to the company for at least 7.5 years).
The other, buried in a footnote, is that Tesla received “assurances that Musk’s involvement with the political sphere would wind down in a timely manner.”
Taken as a whole, it’s a complex agreement with lots of truly pie-in-the-sky ideas about where Tesla could go under Musk’s leadership over the next decade. The same was said about the previous compensation deal that Tesla struck with Musk back in 2018, and yet the company hit all of those seemingly-outrageous goals. (Musk’s award was ultimately dusted by Delaware’s Chancery Court.)
Still, it’s hard not to notice just how much these new goals appear to come from the company trying to drag its CEO’s promises back down to Earth.
Cover:
-Canada's economy contracted 1.6% in the second quarter due to Trump's tariffs, a major threat to the country. However, under Prime Minister Mark Carney, Canada is shifting its approach to a more conciliatory tone, scrapping most retaliatory tariffs. This is happening as countries hit with tariffs adjust to the reality that the US is erecting new barriers under Trump. As the battles unfold, there is a compelling argument that Canada's economy, rich in natural resources, will weather the storm. However, huge hurdles remain, including a new trade deal with the US. Canada's stock market is attractive as a long-term bet, with investors looking for superior market internals and fundamentals. David Rosenberg, an economist and head of Rosenberg Research in Toronto, expects Canada's market to outperform over the next 12 months.
Interview:
-Lowe's CEO Marvin Ellison is preparing the retail chain for an eventual inflection in demand, insulating the company from the impact of new tariffs and expanding its reach into the professional contractor market. This year, Lowe's announced two billion-dollar acquisitions of companies catering to professionals. Investors believe in Ellison's vision, and Lowe's stock has gained roughly 170% since he became CEO in July 2018. The company's success can be attributed to a strong leadership team and a clear plan for the future, despite the unique economic environment, including the pandemic and housing's doldrums due to elevated interest rates. The company's stock has gained roughly 170% since Ellison became CEO in July 2018.
Tech Trader:
-The USA v. Google ended with Google being declared a monopoly, but it escaped the worst of the government's proposed remedies. The stock soared 9% on the news, but there are significant antitrust dangers ahead of the company that investors seem to have overlooked. U.S. District Judge Amit Mehta skirted the most drastic remedies proposed by the plaintiffs, the U.S. Department of Justice and most of the states, because circumstances have changed since the initial trial. By 2025, Google saw its first real competition in years from ChatGPT, Perplexity, and others. Google's lawyers argued that venture funding in internet search was considered Silicon Valley's "biggest no fly zone," and these companies are now better financially and technologically positioned to compete with Google than any traditional search company has been in decades.
The Trader:
-Elliott Investment Management, a hedge fund with $76B in assets, has taken a $4B stake in PepsiCo, a struggling snack-and-beverage giant. The stake, which accounts for about 2% of PepsiCo's market capitalization, represents an opportunity for a turnaround. PepsiCo's snack-and-beverage segment, which used to be its strength, has been struggling, with beverages losing market share to competitors. Pepsi is no longer America's No. 2 soda, surpassed by Dr Pepper in 2023 and Coca-Cola's Sprite in 2024. The company's packaged-food business, including Doritos and Lay's, has been hit by weak consumer spending, shifting health preferences, and a backlash against ultraprocessed foods.
-Stocks have fallen due to a dragging job market, with a mediocre employment report on Friday pulling the market down from record territory. The report showed only 22,000 new positions added in August, below the expected 76,500. Healthcare was one of the few areas where employment rose, while manufacturing employment fell. June's jobs numbers were revised into negative territory. The S&P 500 index fell 0.3% on Friday, while the Dow Jones Industrial Average fell 0.5% on Friday and 0.3% for the week. The good news is that the Federal Reserve will almost certainly cut interest rates multiple times this year to help prop up the economy. Traders see a 67% chance of three rate cuts this year and a 9% chance of a full-point worth of cuts. However, the economy is faltering, with more unemployed Americans than job openings for the first time since 2021.
Features:
-U-Haul's Class B shares, issued in 2022, are trading around $52, down nearly 20% this year despite recent strength in housing-related stocks. The original voting Class A shares are down 16% year to date and up 50% in the past 10 years. The nonvoting shares are trading at 28 times the $1.89 a share the company earned in the fiscal year ended in March, which was down 40% year over year. Investor Steve Galbraith of Kindred Capital believes that U-Haul's earnings power is understated and that it can potentially earn $5 a share annually. Profits should rise as U-Haul works through the depreciation of trucks purchased several years ago. The auto industry's de-emphasized trucks powered by internal combustion engines in 2022 has now reversed.
-The rising costs of buying a home have made homeownership difficult for many Americans. The White House has suggested declaring a national housing emergency in the fall, but provided little detail beyond suggesting the administration is working on standardizing building and zoning codes and reducing closing costs. Experts argue that such an emergency declaration would be an empty gesture, as there are no simple solutions to the affordability crisis. Andrew Wells, chief investment officer of SanJac Alpha, believes that there are no shortcuts to addressing the issue, as it took a long time to create. He suggests that either mortgage rates or insurance costs must be reduced to avoid red herrings and Band-Aid fixes.
Europe:
-The U.S. and French public finances are facing significant bond market volatility in the coming year. The One Big Beautiful Bill Act, which aims to cut taxes on the U.S. government, is expected to add around $5T to the budget deficit, keeping it above 6.5% of GDP indefinitely and increasing the public debt to a Greek-like 128% of GDP by 2034. The U.S. economy's strength lies in its government borrowing in its own currency, making it unlikely that the government will default on its debt. However, the U.S. is heavily dependent on foreigners to finance its budget deficit, owning around 30% of all outstanding U.S. public debt. Foreigners may be reluctant to continue financing the U.S. government at current bond yields, fearing that the US will resort to money printing to inflate its debt. Trump's efforts to undermine the Federal Reserve's independence, such as pressuring Fed Chair Jerome Powell to lower interest rates and firing Fed governor Lisa Cook, make it likely that the U.S.'s unsustainable finances will come to a stop sooner rather than later.
Emerging Markets:
-Emerging market stocks are outperforming US equities this year due to a weakening dollar and a resurgence of China's stock market. The iShares MSCI Emerging Markets index fund has returned 20.7% year to date, nearly double the 10.5% return for the S&P 500. Emerging markets are not a core holding for most U.S. investors, but they should make up about 10% of investors' stock portfolios, compared to about two-thirds for US stocks. A key factor behind the rally is the slumping U.S. dollar, which has fallen about 7% so far in 2025, one of its worst stretches in decades. A weak U.S. dollar makes foreign goods more expensive for U.S. consumers but also increases the value of foreign company profits and stock prices from the perspective of U.S. investors.
Commodities:
-Oil prices have remained elevated despite a growing risk of oversupply, with oil production set to grow by 2.5M barrels a day in 2025 and demand by 680,000 barrels. Traders have been preparing for a price drop, with their ratio of bearish bets to bullish ones hitting its bleakest level since 2008. Brent crude, the international benchmark oil price, has remained strong, holding above $65 per barrel to end the summer. China has been buying 530,000 barrels a day on average for storage, twice as much as usual, for national security. However, OPEC and allies like Russia are restoring 2.2M barrels a day to the market and could bring back more later this year. Although fundamentals will eventually win out, traders are already set up for a drop, so there's less chance of triggering a major selloff.
Streetwise:
-The US stock market is experiencing a dividend boom, with the percentage of earnings paid out to shareholders hitting a 25-year low. J.P. Morgan predicted a 7.6% payment growth over five years, but the S&P 500 dividends are projected to increase by just 4% this year, well below the 11% growth for earnings. The index's yield is barely 1%. Investors have made great money on things that pay nothing, like gold, Bitcoin, and Nvidia. However, dividend stock indexes have largely underperformed over the past decade, leaving dividend stocks relatively cheap and unloved. The US has returned a hefty 16% this year, while investments in other countries have made twice as much in dollar terms. Dividend stocks look similar due to the current market, with the S&P 500 trading at a lofty 24 times earnings.
FINANCIAL TIMES
-A new Chinese community is forming in Japan, with middle-class Chinese individuals moving to Japan for a lifestyle they see as impossible back home. Some Run-ri want permanent residency and the ability to travel back to China for business, while others arrive with no intention of ever returning. Cao, a member of this burgeoning diaspora, is plotting a second move to a part of the city with fewer Chinese. This phenomenon is a phenomenon few saw coming in Japan or China, with dinner party conversations dominated by the mechanics of getting to Tokyo or Osaka.
-Japan's Prime Minister Shigeru Ishiba has announced his resignation to prevent the Liberal Democratic Party from splitting and to make way for a new leader. The decision comes ahead of a party leadership election on Monday, where a majority of LDP parliamentarians are expected to force Ishiba out of office. His position has been uncertain since July, when his party lost control of the upper house of Japan's parliament. Ishiba's decision comes after a disastrous lower house election in October, which left the LDP without a majority in the lower house.
-Federal grand jurors have been demonstrating resistance against the president's immigration crackdown and his recent show of force. In at least seven cases, ordinary people serving on grand juries have refused to indict their fellow residents involved in the crackdown. The secretive nature of grand juries makes it difficult to know precisely why this has been happening, but the persistent rejections suggest that grand jurors may have had enough of prosecutors seeking harsh charges in a highly politicized environment. Judge Sol Wachtler, a former New York jurist, once said that prosecutors are in complete control of grand juries, but this rebellion in Federal District Court in Washington seems to have taken a stand in defense of their community.
-Tensions between President Trump and Illinois leaders escalated when the White House posted an image on social media depicting Trump with helicopters, flames, and the Chicago skyline. The threat came after weeks of the Trump administration promising to crack down on illegal immigration in Chicago, part of a campaign vow to more rigorously enforce immigration laws across the country. It is uncertain when the escalated effort by Immigration and Customs Enforcement might begin, and officials declined to comment on Saturday afternoon.
-European steelmakers are urging Brussels to impose US-style tariffs on all imports of the metal, warning that the industry risks collapse due to cheap Chinese products and Donald Trump's high duties. The EU's steel industry was struggling to compete with cheap imports from China and high energy prices even before the US president imposed 50% tariffs on their exports to America earlier this year. Trump's duties on other countries, particularly China, have raised fears that the EU will be flooded with more cheap metal diverted from the US market. Henne, chair of the supervisory board for Thyssenkrupp's steel division, declined to suggest a tariff level on steel brought into the bloc, but warned that imports were still increasing even as domestic demand remained sluggish.
-Swiss small and mid-sized companies are seeking new corporate banking relationships after the collapse of Credit Suisse, one of the country's two global banks. Credit Suisse was a crucial partner for Swiss businesses and bridging gaps with international markets. The bank's sudden demise in 2023 and state-sponsored rescue by rival UBS created a significant gap in Switzerland's corporate banking ecosystem. Major Swiss companies like Lindt and Nestlé already have relationships with international banks, but the SME sector, which accounts for over 99 per cent of the country's businesses and is the backbone of its economy, has been left rushing to find new relationships.
-Donald Trump's promise to deliver a booming economy to Americans is being undermined by a stalling labor market, warning his party's prospects for next year's congressional elections. The Bureau of Labor Statistics showed jobs growth has been grinding to a halt, with US employers creating just 22,000 positions in August after a weak summer. Trade policy uncertainty is causing a pullback in hiring, and it is not clear whether it will be resolved anytime soon. Democrats have provided fresh ammunition for their claims that Trump's economic policies are doing more harm than good, as trade policy uncertainty is causing a pullback in hiring.
-German executives of manufacturing and energy industries have expressed concerns over the cost of "green" hydrogen, a key component of the country's carbon emission reduction efforts. Thyssenkrupp, the country's largest greenhouse gas emitter, warned that unless the cost of renewable hydrogen decreased, it would have to use fossil fuels to run its flagship green facility in Duisberg. Germany has set ambitious targets for producing and importing hydrogen, supported by billions in subsidies and loans. However, sluggish economic growth and trade competition from China are causing a global slowdown in its adoption.
NEW YORK TIMES
-The Pentagon prevented a senior Democrat from visiting a military spy agency. Armed forces in Venezuela began a military campaign against drug cartel members without congressional authorization. The White House planned to cancel $5 billion in foreign aid funding, escalating its campaign to undercut legislative spending powers. Health Secretary Robert F. Kennedy Jr. ousted the director of the Centers for Disease Control and proposed changes to restrict access to Covid-19 vaccines, despite pledging not to make it more difficult during his confirmation hearings. These events highlight the ongoing political turmoil in the US.
-China's most ambitious cyberattack, known as Salt Typhoon, targeted over 80 countries and may have stolen information from nearly every American. The attack, which targeted major telecommunications companies and others, was a yearslong, coordinated assault. The range of the attack was far greater than initially understood, and security officials warned that the stolen data could allow Chinese intelligence services to exploit global communication networks to track targets including politicians, spies, and activists. The hackers sponsored by the Chinese government are targeting networks globally, including telecommunications, government, transportation, lodging, and military infrastructure networks. The attack is seen as evidence that China's capabilities rival those of the United States and its allies.
-John Deere, the leading supplier of agricultural machinery in the US, had reported a record profit two years ago, but President Trump's tariffs and trade policies are making the market more challenging and unpredictable for the business and its customers. The company's net income in its most recent quarter was down 29% from a year earlier, and higher tariffs on steel and aluminum have cost the company $300M so far, with nearly another $300M expected by the end of the year. This summer, the company laid off 238 employees across factories in Illinois and Iowa. Despite this, John Deere is a manufacturing powerhouse that President Trump wants more of in the US. The company employs 30,000 workers in 60 facilities across the country and says more than 75% of its machines were assembled in the US. Just 25% of the components used in its products come from foreign countries.
-President Trump, who promised to keep the US out of wars and leave a legacy of unification, has signed an executive order to establish a Department of War. This contradicts his presidency's image, as he seeks the ultimate prize for peace while promoting a more aggressive use of U.S. military might. In a social media post, Trump suggested going to "war" with Chicago, where he has threatened an immigration crackdown. He also mentioned Chicago was "about to find out why it's called the Department of WAR," along with three helicopter emojis. When asked about how he squared his Department of War with his push for peace, Trump did not see a contradiction.
-South Korea has reached a deal with the US to release hundreds of South Korean workers arrested during a raid on a Hyundai-LG electric vehicle battery plant in Georgia. The South Korean presidential office announced that after administrative procedures are cleared, a chartered plane will be sent to bring the workers home. This comes after days of tensions between the two countries. The US immigration authorities stormed the site, arresting 475 people, including 300 South Korean citizens, and reportedly releasing about 300 workers. The agreement marks the first sign of a diplomatic solution after days of tensions.
-The Trump administration has launched an Immigration and Customs Enforcement operation in Massachusetts, targeting the worst criminal illegal aliens in the state. The operation, called Patriot 2.0, has been described as harsh by the Department of Homeland Security, which has warned that if an individual enters the country illegally and breaks the law, they will be hunted down, arrested, deported, and never returned. The operation began late this week and is expected to last several weeks. The US government has prepared plans for a wider surge of immigration enforcement starting this month. The operation began just days before the Trump administration's planned immigration crackdown in Chicago and as arrests in Washington have increased.
-France's government is expected to fall for the second time in nine months after a confidence vote in Parliament. French Prime Minister François Bayrou called for support for his plan to mend the country's finances with 44B euros (about $51B) in spending cuts. If the vote goes against him, Bayrou will be forced to resign and Macron will have to name another prime minister to fix France's budget. Investors have pushed up French borrowing costs to among the highest in the Eurozone, reflecting rising risk.
-The remains of 42 people found outside an ethnic Polish village in western Ukraine were reburied in individual caskets, each topped with blue wildflowers, marking a significant milestone in Ukrainian history. The ceremony brought closure to family history and put an end to a long-standing dispute with Poland over World War II-era massacres. Poland accused Ukraine of sweeping war crimes by the Ukrainian underground under the rug after the Soviet breakup. In Ukraine, members of the Ukrainian nationalist movement have been elevated to the status of heroes who paved the way for the country's eventual independence in 1991.
-Trump has canceled his plans to visit India for the Quad summit, following a phone call with Indian Prime Minister Narendra Modi. Trump is now seen as a source of national humiliation in India, with a giant Trump effigy paraded around a festival in Maharashtra, claiming him a backstabber. The intense blows from the US have been described as "gundagardi" or "thuggery." The story of Trump and Modi is about two populist leaders with big egos and authoritarian tendencies, and the web of loyalties that keep both men in power. However, it also highlights the American president's ambition to win a Nobel Prize while running into the conflict with Pakistan.
-The Los Angeles Police Department has ended its protection services for former Vice President Kamala Harris after facing criticism from an elite unit of its officers and the police union. The department has assigned officers to assist the California Highway Patrol in providing security for Harris. The agencies stepped in to fill the security gap left after President Trump terminated her Secret Service security detail. The U.S. Secret Service typically protects vice presidents for six months after leaving office, but President Joseph R. Biden Jr. signed an executive order to extend that protection for an additional year for Harris.
-A preliminary report on the deadly funicular accident in Lisbon has revealed that a cable on the upper car had disconnected. The cable connecting the two cars failed at its attachment point on the upper car, and investigators found that despite two braking systems applied, neither could stop the rapid descent of the car, which was estimated to have made impact at 60 kilometers per hour. The report suggested that this was not surprising, as without the support of the connecting cable, the brakes alone "do not have sufficient capacity to stop the moving cabins." The Portuguese aviation and rail accident investigative agency did not explain how the cable broke free, but from an initial review of the wreckage, the remainder of the connecting cable, including the attachment point on the other car, presented no anomalies. The report cautioned that no conclusions could be drawn about the accident's cause and that another preliminary report would be released within 45 days.
NEW YORK POST
-South Korean President Lee Jae Myung has ordered swift action following the arrests of hundreds of citizens in a US immigration raid on a Hyundai Motor car battery factory in Georgia. Foreign Minister Cho Hyun has set up a team to respond to the arrests and may go to Washington to meet with officials if needed. The incident could exacerbate tensions between the Trump administration and Seoul, a key Asian ally and investor, as they have been at odds over the details of a trade deal that includes $350 billion of South Korean investment in the United States. The incident could exacerbate tensions between the two countries.
-Anthropic has agreed to pay $1.5B to settle a class-action lawsuit from authors who accused the company of using their books to train its AI chatbot Claude without permission. The settlement, announced in August without disclosing the terms or amount, is the largest publicly reported copyright recovery in history. The deal marks the first in a string of lawsuits against tech companies including OpenAI, Microsoft, and Meta Platforms over their use of copyrighted material to train generative AI systems. Anthropic will destroy downloaded copies of books the authors accused it of pirating, and under the deal, it could still face infringement claims related to material produced by the company's AI models.
OPEC+ to Boost Oil Output Further Despite Supply Glut Concerns
Production increase comes as OPEC and its allies seek to boost market share
The Organization of the Petroleum Exporting Countries and its allies agreed to raise oil output further next month, despite broader concerns about a looming supply glut.
After an online meeting Sunday, eight OPEC+ members said they will boost production by 137,000 barrels a day in October, beginning to roll back some voluntary cuts they had previously put in place. The alliance, which comprises OPEC and other top oil producers including Russia, had been expected to keep output steady until recent days.
Oil prices closed the week lower, with Brent crude trading around $65 a barrel amid growing concerns of a potential OPEC+ supply increase and an unexpected buildup in weekly U.S. crude inventories. Brent crude and West Texas Intermediate have both retreated by more than 10% this year.
OPEC+, which pumps about half of the world’s oil, had been curtailing production for years to support prices, but has more recently shifted course in a bid to boost market share.
The output increase announced Sunday starts to unwind a tranche of curbs totaling roughly 1.65 million barrels a day that had been set to remain in place until the end of next year. OPEC+ members said Sunday the barrels may be restored in part or in full “subject to evolving market conditions.”
The alliance already had agreed to fully reverse a 2.2 million-barrel cutback it made in 2023 with a series of output increases from April to September. Other collective curbs of 2 million barrels a day remain in place.
While the production increases have prevented prices from rising sharply amid heightened geopolitical tensions, they have sparked fears of an impending glut among investors.
This has yet to show in inventory data, largely because of robust summer demand and only modest stock buildups in OECD countries, according to market watchers.
Actual OPEC+ production also has fallen short of pledged volumes in recent months, as some members had to restrict output to compensate for earlier overproduction. Still, analysts worry that the group’s increases—along with rising output from producers outside the alliance—would be enough to tip the market into a surplus in the first half of 2026.
The eight producers behind the voluntary cuts—namely Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman—said they would meet on Oct. 5 to discuss November production levels
Stock Funds Continue to Score
The 2.9% gain in August keeps the positive times rolling. Plus: A Financial Flashback to 95 years ago, the Wall Street bombing of 1920.
- U.S.-stock mutual funds/ETFs rose 2.9% in August, up 8.5% year-to-date. International stocks also performed well.
- Many analysts anticipate the Federal Reserve will cut interest rates, boosting investor confidence despite high valuations.
- Gold funds surged 20.7% in August, a 79.7% year-to-date increase, driven by geopolitical tension and rate-cut expectations.
No need to go to the replay: The stock market is grinding out wins like an NFL juggernaut.
In August, the average U.S.-stock mutual fund or exchange-traded fund posted a total return of 2.9%, according to LSEG data, to push the year-to-date advance to 8.5%. International-stock funds were also strong, up 3.5% in August and 21.2% for the year to date. (See funds-data tables including Mutual-Fund Yardsticks.)
The confidence of investors and many analysts stems from expectations that the Federal Reserve will cut interest rates at its policy meeting Sept. 16-17. In addition, tariff drama hasn’t sent investors into a panic.
While valuations are high, many analysts don’t see trouble ahead, short of the Fed surprising everyone by keeping rates as they are.
“Although September is typically the weakest month of the year on average, we don’t see anything on the horizon to knock this bull market off its path,” says Chris Zaccarelli, chief investment officer for Northlight Asset Management.
Some investors, wary of valuations of the growth stocks that have led the market, are adding to their positions in value stocks—shares that are thought to be trading below the companies’ worth. LSEG’s large-cap value category gained nearly 3% in August, to push the year-to-date gain to 10.8%, virtually even with large-cap growth’s year-to-date advance.
Gold-oriented funds have continued to rise along with record prices for the metal. Gold is being boosted by the perfect storm of geopolitical tension and the expectation of lower interest rates. Gold funds were up 20.7% in August, to push the year-to-date advance to 79.7%.
Bond funds rose in August. The total return for funds focused on investment-grade debt (the most common type of fixed-income fund) was 1.3% on average, to push the year-to-date gain to 5.1%.