TheChek News Flow

Intense heat and lack of rain have driven water levels across the continent to record lows

A series of severe heatwaves and prolonged droughts have turned many European riverbeds into barren sandscapes this summer.

Major arteries for trade and agriculture across the continent—including the Rhine, Danube and Po—are now at record low levels, disrupting freight transportation, forcing nuclear power plants to shut reactors and eroding agricultural productivity.

The Wall Street Journal analyzed European rivers using satellite imagery to calculate a water index that highlights surface water. The following maps show the change in surface water from this time last year: The less water, the lighter the colors seen.

Water levels in the Danube have become so low that the river can no longer supply the cooling water needed for Romania’s only nuclear power plant.

The Cernavodă plant, which supplies about a fifth of Romania’s power demands, shut down in mid-August after the military’s attempts to divert more water toward the plant using explosives didn’t pay off.

At Hungary’s Paks plant, which generates about 40% of the country’s electricity, water shortages have put the facility on the threshold of a shutdown.

In some parts of the Rhine, Western Europe’s principal economic artery, conditions have forced vessels to carry loads as little as 20% of normal capacity, raising shipping costs and disrupting the supply chain.

Italy’s longest river, the Po, is essential for irrigating farmland. The river’s retreat makes it vulnerable to the incursion of sea water from the Adriatic, posing a threat to crops.

The Rhine fell to just 9½ inches at the critical shipping bottleneck of Kaub, Germany, this summer, severely restricting inland freight transport. At one point, the gage measurement on that stretch of the river reached below three inches. Vessels could still navigate, but with much smaller loads, making the transits less economically viable.

Meanwhile, falling levels in the Danube—Europe’s second-longest river, flowing through 10 countries from Germany to the Black Sea—have disrupted navigation and power generation, while placing additional stress on regional water resources.

Despite a wetter-than-average winter in most of Southern and Western Europe, soils quickly dried out under the intensity and length of repeated heatwaves since May. Most of the rain that does eventually fall will be absorbed by the parched ground before it can replenish rivers, exacerbating the problem.

The drought across large parts of Europe helped fuel devastating wildfires in France and Spain in July, and there is no respite in sight. Forecasts indicate that hot and dry conditions are likely to persist through August and into September, according to the European Commission.

Watch Gen. B. Chance Saltzman explain why space is becoming increasingly important in modern warfare

From Venezuela to Iran, the U.S. has used satellites and other space capabilities to gain an advantage in warfare. Space technologies can help detect missile launches, synchronize strikes, provide a clear view of the battlefield and degrade an enemy’s ability to operate.

The Wall Street Journal’s Shelby Holliday spoke with Gen. B. Chance Saltzman about the U.S. Space Force’s pivotal year, and how the military must prepare for a future in which adversaries such as China seek to challenge America’s advantage in space. Watch the interview here.

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Why eyewear stores are taking over London’s high streets

Private equity-backed brands such as Cubitts, Ace & Tate and Jimmy Fairly compete for scale in financially alluring sector

It is hard to walk through London without encountering spectacle shops. The proliferation of estate agents has been succeeded by outlets of brands such as Ace & Tate, BlooBloom, Cubitts and Jimmy Fairly. They seek to lure design- and budget-conscious customers from longstanding optical chains such as Specsavers and Vision Express.

About 10 such brands are clustered in Soho and Carnaby Street, and three on Broadway Market in east London, including one branch of Cubitts in a former eel, pie and mash shop. Private equity-backed efforts to take on the industry’s giants, led by Vision Express’s owner EssilorLuxottica, are changing some retail districts.

But even some of the people involved are sceptical about the chances of many of these upstarts succeeding. “Everyone is following each other and destroying value. When I see another one opening, I think good luck to you,” says Tom Broughton, chief executive of Cubitts, the UK chain he founded in his flat on Cubitt Street 13 years ago.

Broughton was working as a consultant when he conceived the idea for a design-led eyewear brand. “I would go into Specsavers and I did not understand why the glasses I wanted did not exist. Frankly, I thought I could do a better job,” he told me at Cubitts’ new head office and workshop in a former stables near King’s Cross.

He was not alone: the Netherlands brand Ace & Tate was also founded in 2013 in the wave that followed Warby Parker, the pioneering US eyewear brand that started online in 2010 but has 320 branches in the US and Canada. Jimmy Fairly, a French brand founded in 2011, now has 19 UK branches, including 15 around London.

Eyewear is financially alluring. EssilorLuxottica, which has 18,000 stores under various brands, made operating profits of €4.4bn on sales of €28.5bn last year. It also has a partnership with Meta to make smart glasses with cameras. Specsavers, the biggest UK operator, reported £4.5bn in revenue in the year to February, selling 26mn frames.

Anyone who has entered an optician’s for an eye test and left after spending £400 or more on a pair of glasses will see the potential for competition. Most offer expensive lenses with frames made under licence from brands such as Chanel and Burberry (both have licensing deals with EssilorLuxottica).

Broughton describes the cost of producing a standard frame and optical lenses as “pretty low”. He estimates that a typical high street optical chain will sell a frame for about three times the wholesale cost and lenses at up to five times. Cubitts uses Zeiss lenses in frames that it designs and produces, offering a pair of spectacles with standard lenses for £175.

But the costs of building brands and opening enough shops to attract a large enough base of loyal customers are substantial. Warby Parker and Ace & Tate found they could not operate purely as online direct-to-consumer brands and needed branch networks. This is not like other kinds of retailing: it requires optometrists to give most customers eye tests before they can move to buying frames and lenses.

“It looks like the barrier to entry is low, but it is very high,” says Lex van de Vliet, Ace & Tate chief executive. Its sales were €65mn last year it and achieved positive earnings before interest, tax, depreciation and amortisation (ebitda) for the first time. It now has 93 stores, which he estimates is about the minimum that such brands need: “Then, the whole thing ticks”.

Cubitts has 20 stores, including two in New York, so it is sub-scale by that standard. It had revenue of £16.8mn and ebitda of £330,000 last year but made a loss of £967,000. Broughton says that Active Partners, the private equity firm that owns a 26 per cent stake in Cubitts (he has 58 per cent) wants to keep adding branches but he is reluctant to scale rapidly.

He predicts a shakeout of brands burning through private equity capital in an effort to expand. He also believes technology will change the industry, allowing people to try frames virtually using face-scanning apps on their phone, rather than having to do so in person. It has been developing software to offer more products online or through other opticians.

That is a wise precaution, given the number of brands competing on London’s streets. “We’ll open the odd store in the right place but we want to change the way people buy glasses,” Broughton says. Good luck to you, those who have tried before might retort. But the industry remains a tempting target.

A leaderboard of the biggest trading losses of all time

Well, some of them, anyway

On Friday, MainFT scooped the overall impact of Leopold Aschenbrenner’s $35bn July trading loss on Jane Street Capital’s own, otherwise enviable, investment record.

And the losses generated by Aschenbrenner’s leveraged AI stock bets put him up at the top of the global leaderboard of fund facepalms. We know this because we found a cool table on Wikipedia. It’s a catalogue of financial disasters, based largely on this CFA monograph by Thomas S Coleman — an ex-Moore Capital risk-guy-cum-finance-academic — though it captures far more than just hedge fund trainwrecks.

Anyway, we thought it would be fun to bring the magic of dataviz to the top part of this table to more easily contextualise the quantum of Aschenbrenner’s loss.

We’ve colour-coded the losses by the type of entity that generated them, and populated cool custom pop-ups that provide a ton of details — like the people linked to them, whether there was jail time, what happened to the funds that took losses, that kind of thing. We’ve also curated links you can click to read more about each meltdown.

Only seven of these top 25 trading losses are from funds: most are either banks (which are, in turn, mostly rogue traders) and normie companies who mishedged.

Now there are two steps to a fund losing a lot of money.

The first step is to inspire faith in either a large number of fairly wealthy people or a small number of immensely wealthy people to pay you vast sums because you’ve got both great ideas and decent risk management.

The second step is to do exactly the thing loads of people use to make a lot of money: throw together a credible investment thesis, have sufficiently high conviction in it that you’re able to persuade yourself and others to cast aside risk management 101, maybe chucking a bunch of financial leverage into the mix for good measure.

The second step is easy. There are thousands of people yoloing in their mums’ basements around the world doing just this right now, drawing from their experience either bragging rights on Reddit and a new Lambo/ existential dread of imminent bankruptcy (delete according to the luck of their draw). So if you’re interested in maximising your ranking on any quantitatively measured global leaderboard of trading losses, the first step is probably more important.

With around $89bn of AuM, Millennium Management needs to drop just a couple of per cent in a month to find itself with a $2bn trading loss — something that could reasonably be expected to do a few times a year, and something they reportedly just did in July. The Vanguard 500 Index Fund had $1.7tn of net assets at the end of July, meaning daily ups and downs in the S&P 500 are likely to eclipse Situational Awareness’s July record at some point most months. Although maybe not actually realising these losses means they don’t count.

Are these just pedantic asides? Not really. When it comes to funds, we’re fairly sure that this league table, like every other we’ve chanced upon, is only really capturing the kind of meltdowns that make good copy.

There’s Tiger Global’s ca $40bn bloodbath in 2022, for example, which arguably should put it at the top of the list. There’s a case that Jane Street should, itself, be catapulted into the least desirable leaderboard in the financial world, given the reported $15bn hit that it took in July from its exposure to Aschenbrenner’s flameout. And we might even be able to colour its bar blue, with opinion moving day-by-day in the direction of Jane Street being a quasi hedge fund rather than just a market maker.

After all, the number is large and the copy is excellent.

Young customers are flocking to ‘ready-to-drink’ beverages as other alcohol sales slump

The booze business has been suffering from a post-pandemic hangover for the past couple of years. Now that a lockdown-fuelled boost in home drinking has faded, spirits are enduring a huge sales downturn, wineries are closing at record rates and volumes of beer produced have slumped.

The share of Americans who say they drink alcohol has dropped to a historical low, and even those who do are drinking less amid an increased focus on wellness and an affordability squeeze. US underage drinking has fallen even faster, reaching all-time lows in 2025, leading many analysts to predict — and industry executives to fear — that young Americans were becoming stay-at-home teetotallers.

Listed drinks groups have been swapping chief executives faster than a frat boy throws back shots: Diageo, Brown-Forman, Constellation Brands and Rémy Cointreau have all changed leaders in the past 18 months.

But a ray of hope for the industry is starting to shine through. Despite their later start, Gen Z, those born between 1997 and 2012, aren’t Puritans after all. Some 74 per cent of US Zoomers of legal drinking age report drinking in the past six months, up from 66 per cent three years ago. More Gen Zers drink than boomers and they are not far off the general population rate of 76 per cent.

The youngest generation of legal drinkers just indulges differently, and for companies that cater to their cravings, the good times are starting to roll.

Sales of “ready-to-drink” concoctions of alcohol with soda, juices and other mixers have been shooting up. Drinks such as Surfside’s Peach Tea and Vodka and Cutwater’s Mango Margarita are winning over younger consumers who like the low price, ease of use and innovative flavours.

“They’ve got this ‘I don’t want to drink my parents’ drink’ element,” says Ed Mundy, a drinks analyst at Jefferies.

Alcopops have popped up as beer alternatives before. Gen X had their 1980s wine coolers; the mid-1990s saw the rise of Zima and other carbonated malt-based drinks, and hard seltzer brand White Claw became such a phenomenon in 2019 that there were nationwide shortages.

But never before have canned mixed drinks played such an important role in the industry’s hopes for its future.

Since 2019, US sales in the RTD category have logged a bubbly combined annual growth rate of 11 per cent while overall alcohol sales have fallen flat at minus 1 per cent despite a pandemic-induced boost, according to IWSR, a market research firm. Premade drinks now account for 8 per cent of total US alcohol consumption.

That translates into big bucks: US sales of premixed cocktails have increased more than six times from $489mn in 2020 to $3.8bn last year.

And where the US leads, many expect other countries to follow. Though RTDs currently account for just 1 per cent of UK sales by volume, they have been growing 8 per cent a year since 2019, IWSR says. Research group MFRF projects European sales will more than double in the next decade.

Some of the fizz in the canned drinks market is almost certainly due to the fact they are relatively cheap at a time when customers are feeling pinched by high fuel prices and prolonged inflation.

US restaurants are marking up wine bottles by six times cost, and $20-plus cocktails are the norm at big city bars. But a four-pack of Carbliss Vodka Cranberry goes for $13.50, and a single BuzzBallz Tequila ’Rita sells for $3.99.

“Particularly in spirits, affordability has gotten out of whack,” says Chris Goodchild, a Boston Consulting Group senior partner who works with drinks groups. “If you compare today with 2020, getting a cocktail or a glass of wine is materially more expensive than it was.”

The appeal of canned cocktails goes beyond price. The convenience of premixed drinks meshes well with today’s socialising patterns. Young Americans are drinking more at home or in small groups rather than in the country’s shrinking number of bars and nightclubs. RTDs also fit into “third spaces” — festivals, sporting events — that serve alcohol but do not have the staff to provide a full bar.

Brands are leaning into group fun with packaging that sparks on social media, such as BuzzBallz’s neon spheres and Surfside’s distinctive stripes.

At the same time, canned drinks can also appeal to those concerned about safety and wellness. Pre-mixed cocktails feel more tamper-resistant than a bowl of mystery punch. Individual portions also make it easier to “zebra stripe”, slang for alternating liquor with non-alcoholic drinks to reduce total consumption.

So far, the big spirits groups have largely missed out: The most popular RTD brands are independent (Carbliss, Surfside) or owned by beer and wine companies (Gallo’s High Noon and AB InBev’s Cutwater).

Canned cocktails were seen as low-rent when spirits groups were boasting about their ability to push up prices in the name of “premiumisation”. Spirits distribution networks are focused on liquor stores rather than convenience stores and supermarkets where Gen Z consumers tend to shop.

That is finally starting to change. Sazerac bought BuzzBallz in 2024 and is rolling it out globally. Diageo’s new CEO said last week that canned cocktails are a big part of plans to revive the beleaguered group. A generation of drinkers is picking its tipple of choice. The big spirits makers need to join the party.

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