WSJ : The Hardest Part About Being a Billionaire in California: Proving You Left

The Hardest Part About Being a Billionaire in California: Proving You Left
Advisers recommend leaving breadcrumbs, like a ‘we’ve moved’ note on the Christmas card, and you really do have to quit the country club.

A proposed billionaire tax has some of the richest Californians eyeing the exits. First they’ll have to contend with the state’s dogged tax collectors.

California has one of the nation’s highest personal income-tax rates on high earners. It’s also home to officials who pore through phone logs, look for country-club memberships and even double-check visits to the dentist—all to figure out what really functions as home.

This can be a tricky question. The superwealthy might have a house in the Bay Area or the Hollywood Hills, but also spend time in a Paris apartment, a Florida compound or a yacht off the coast of Greece.

Also, California has few hard-and-fast rules on residency. Tax advisers say you’re generally considered a resident if California is your “domicile”—a true home base to which you plan to return. A person domiciled in California who spends time elsewhere is sometimes still expected to pay state income taxes.

“If you leave, you really have to leave,” said Steven Toscher, managing principal of Hochman Salkin Toscher Perez, a Beverly Hills law firm that advises clients on navigating California residency.

Advisers generally recommend that people who want to avoid California’s tax net limit their visits and keep clear records of their purpose and duration.

Some advisers also suggest leaving breadcrumbs, such as adding a “we’ve moved” note with your new address to Christmas cards, telling your house of worship in a letter you’ve found a spiritual home elsewhere, and making and keeping appointments with out-of-state doctors, accountants and veterinarians.

Learning what it might take to truly depart sometimes proves too much.

“You’re a member of the L.A. County Club? Not anymore, you’re not,” said Alan Witlen, a partner in the private client and tax practice at Withers in Los Angeles. “That’s where a lot of these conversations break down. People realize they don’t want to give up these things they love.”

The state relies heavily on high earners. In 2023, more than one-sixth of its personal income tax revenue came from the top 0.1% of earners, or about 17,500 filers.

Consciously uncoupling from California has become a hot topic thanks to a proposed, one-time, 5% tax on billionaires’ assets.


Supporters say the tax would raise some $100 billion to help address looming federal cuts to Medicaid. The union proposing it has to clear several hurdles, including collecting nearly 875,000 valid signatures to make November’s ballot.

That prospect has unsettled California billionaires, in part because it would apply to those who were residents as of Jan. 1. The focus on taxing assets—a far bigger financial hit than a higher income tax—has drawn particular alarm.

With its Silicon Valley and entertainment fortunes, California has more billionaires than any other state, according to Altrata, a wealth-intelligence firm. Its estimates are based on business addresses, and not all of these people would necessarily count as residents.

In a private Signal chat, dozens of Silicon Valley billionaires and other tech elites criticized the proposal and shared alternatives. In the final hours of 2025, a few worked to put daylight between themselves and California.

Peter Thiel’s private investment firm Thiel Capital, which is largely based in Los Angeles, said it signed a lease for office space in Miami. And a spokeswoman for David Sacks, the Trump administration’s crypto and AI czar and a longtime San Francisco resident, said he has been a Texas resident since December.

The “select few billionaires” looking to leave will eventually have to answer to California tax officials, said Suzanne Jimenez, chief of staff of the healthcare workers union behind the proposal.

“A billionaire temporarily relocating to their fourth or fifth mansion in another state does not officially mean they avoid paying a fair share to help keep emergency rooms and hospitals open,” Jimenez said.

The Franchise Tax Board, the state agency that collects personal income tax, says it doesn’t track what share of its residency audits are for higher earners.

The process for determining whether a taxpayer truly moved away stems from a complex and long-running tax case involving Stephen Bragg, a California crane operator who moved to Arizona to become a cattle rancher.

Bragg worked 70 to 90 hours a week on his Arizona ranch, but also had a wife and children in California, as well as bank accounts, registered vehicles and business interests in Arizona and Texas, according to a state board’s decision on the case. The board concluded Bragg had been an Arizona resident in 1993, and listed 19 factors that officials continue to consult when determining residency.

They include where your businesses, spouse and children are based; how many days you spend in California and why; where your credit card transactions originate; where you’re registered to drive and vote; and where you’ve joined membership organizations like country clubs and gyms.

If someone stops paying California taxes and gets flagged for an audit, the burden is generally on them to prove they left when they claimed.

“There is no gaming the Franchise Tax Board,” said Jenny Hill Bratt, a partner in Sheppard Mullin’s San Diego private clients and tax practice.

Last year, California’s Office of Tax Appeals upheld a finding that comedian Russell Peters owed more than $2.1 million in back taxes for 2012 to 2014, when he had filed as a nonresident or part-year resident.

The tax appeals office reviewed, in part, auditors’ “reconstruction of his physical presence” using his credit card data and found Peters spent far more days in California in 2012, 2013 and 2014 than in Nevada.

The tax appeals office also looked at a child custody case with Peters’s ex-wife to glean details on their “family abode.” It found Peters’s physical presence and familial abode “more strongly” indicated his domicile was in California and that his physical presence and property “heavily support California residency.”

BYLD partner Peter Smiley, a lawyer for Peters, said his client “relies entirely on the advice of others” to navigate tax law. “Mr. Peters always understood that he had paid the taxes he owed,” Smiley said.

WSJ : Senate Democrats Vow to Block DHS Funding, Risking Another Shutdown

Senate Democrats Vow to Block DHS Funding, Risking Another Shutdown
Latest deadly shooting in Minneapolis unites party on taking a hard line against Trump administration’s immigration policy

  • Senate Democrats indicated they are willing to shut down parts of the government rather than fund immigration enforcement after another Minneapolis shooting.
  • Democrats are demanding constraints and oversight on the Department of Homeland Security’s immigration enforcement activities.
  • The potential shutdown looms as federal government funding expires on Jan. 31, impacting a $1.3 trillion spending package.

WASHINGTON—Senate Democrats signaled Saturday that they would be willing to shut down much of the government rather than vote for a package that includes funds for immigration enforcement, following another deadly shooting in Minneapolis.

Senate Minority Leader Chuck Schumer (D., N.Y.) said Democrats wouldn’t vote to advance a broader package needed to fund federal agencies if the current measure funding the Department of Homeland Security is included. Democrats are demanding constraints on DHS’s immigration enforcement activities and more oversight.

“What’s happening in Minnesota is appalling—and unacceptable in any American city,” Schumer said in a statement. He said the DHS bill “is woefully inadequate” to rein abuses by immigration officials.

Republicans control the Senate 53-47, but 60 votes are needed to advance most legislation.

Schumer’s statement came after many Senate Democrats—including some who broke with the majority of their party in November and voted to reopen the government—issued angry statements Saturday saying they wouldn’t support a bill funding DHS, the agency that includes the U.S. Border Patrol and Immigration and Customs Enforcement.

“Enough is enough,” said Sen. Jacky Rosen (D., Nev.), who last year was one of eight Democrats to join Senate Republicans in voting to end the shutdown. “I have the responsibility to hold the Trump administration accountable when I see abuses of power,” she said in a social-media post.

The statement from Schumer raised the prospect of a partial government shutdown when funding for the federal government expires at 12:01 a.m. on Jan. 31, since the Homeland Security funding is wrapped into a broader package covering about $1.3 trillion in annual spending. Senate Democrats are expected to hold a caucuswide call on Sunday.

Heading into the weekend, many Senate Democrats had wanted to avoid another shutdown. But the deadly shooting of a 37-year-old man in Minneapolis by a U.S. Border Patrol officer changed the dynamic, aides and lawmakers said, uniting the party in taking a hard line. The Trump administration has surged border-control officers into the city as part of a crackdown on illegal immigration, sparking protests and physical confrontations.

Sen. Catherine Cortez Masto (D., Nev.)—who consistently voted to keep the government open last year—said that she couldn’t support funding for DHS, saying agents were “oppressing Americans.”

Other Democrats who issued statements vowing to vote against the funding include Sens. Andy Kim of New Jersey, Mark Kelly and Ruben Gallego of Arizona, Mark Warner of Virginia and Chris Van Hollen of Maryland. Sen. Tim Kaine (D., Va.) had already indicated a day earlier that he disliked funding DHS as part of a larger package, citing in part what he said were a lack of “safeguards against ICE operations that inflame tensions within our cities.”

In a sign that frustration with the Trump administration’s approach extends across the aisle, House Homeland Security Committee Chairman Andrew Garbarino (R., N.Y.) said that he has asked top DHS officials including Customs and Border Protection Commissioner Rodney Scott to testify before the panel.

Republicans senators have largely backed the Trump administration’s immigration crackdown, but there were signs of growing concern. Sen. Bill Cassidy (R., La.) said the “events in Minneapolis are incredibly disturbing” and called for a joint federal-state investigation. “The credibility of ICE and DHS are at stake,” he said.

Sen. Lisa Murkowski (R., Alaska) said an earlier shooting in Minneapolis was deeply disturbing, calling for a thorough investigation and policy changes.

The office of Senate Majority Leader John Thune (R., S.D.) didn’t respond to a request for comment.

Next week the Senate is set to take up six bills that fund the military and social services—the bulk of federal discretionary spending—for the remainder of fiscal 2026, which runs through September.

Heading into the weekend, many Democrats had been expected to join Republicans in passing the measures, which have been bundled together as one vote.

But Democrats’ widespread anger called that into question. The House is scheduled to be out of session next week, meaning a possible partial shutdown beginning Saturday if the Senate fails to pass the package, or decides to change the legislation.

The House last week passed the final four of the 12 annual spending bills, including those funding DHS and the Pentagon—typically a GOP priority—and the Labor Department and the Health and Human Services Department, whose priorities are favored by Democrats. Together, those four measures would provide more than $1.2 trillion of the more than $1.6 trillion in the government’s discretionary spending for fiscal 2026.

The House packaged those four bills plus two more into a single measure and sent it to the Senate. If Senate Democrats want to oppose funding for DHS, they have to oppose the entire collection of bills—including one funding the military, which is about $831 billion. If senators reached a deal to pass all of the bills except DHS, the revised package would then need to go back to the House for its approval.

Voting against the package will do little in the short term to curtail immigration enforcement. President Trump’s major legislative achievement—which he dubbed the “one big beautiful bill”—provided $4.1 billion to hire and train additional border-patrol agents. Republicans used a special procedure to pass that bill along party lines with no Democratic support.

FT : US to invest $1.6bn into rare earths group in bid to shore up key minerals

US to invest $1.6bn into rare earths group in bid to shore up key minerals
Washington to invest in USA Rare Earth as bank run by Howard Lutnick’s sons advises group on separate fundraising

The Trump administration is planning to inject $1.6bn into an American rare earths company, its biggest investment in the sector, in Washington’s latest foray into private industry to shore up supplies of key minerals.

The US government will receive a 10 per cent stake in USA Rare Earth, a publicly traded Oklahoma-based miner that controls significant US deposits of heavy rare earths, according to people familiar with the matter.

The government investment and a separate $1bn private financing deal are expected to be announced on Monday, according to people familiar with the situation.

One person said the government would get 16.1m shares in USA Rare Earth and warrants for another 17.6m, both at a price of $17.17. The government agreed to pay $277mn for the equity, giving it an implied gain of $490mn for the equity and warrants based on the current share price of $24.77.

USA Rare Earth will also receive $1.3bn in senior secured debt financing at market rates from the government. The money will come from a finance facility created for the commerce department as part of the CHIPS and Science Act passed in 2022. A commerce official said the department completed the transaction directly with the company.

Talks progressed rapidly this week as investor interest returned to critical mineral stocks after President Donald Trump said Washington had reached the “framework” for a deal that could include access to Greenland’s untapped critical mineral wealth. One person familiar with the situation noted that the USA Rare Earth deal was unrelated to Greenland.

USA Rare Earth declined to comment. The commerce department declined to discuss the deal. But an official in the Chips office — a part of the commerce department housed at the National Institute of Standards and Technology that led the negotiations — said it was “focused on onshoring critical and strategic mineral essential to the semiconductor supply chain and US national security”.

USA Rare Earth has separately tapped Cantor Fitzgerald, the Wall Street firm previously owned by commerce secretary Howard Lutnick and now run by his sons, to raise more than $1bn in fresh equity financing, the people said. It is not directly related to the deal with the government.

The deal marks the latest example of the Trump administration’s efforts to intervene in parts of the private sector viewed as critical to US national security, including taking a 10 per cent stake in chipmaker Intel and negotiating a so-called golden-share agreement in US Steel.

USA Rare Earth, which has a market value of $3.7bn, is developing a huge mine in Sierra Blanca, Texas that it says contains 15 of the 17 rare earth elements underpinning production of cell phones, missiles and fighter jets. It also plans to open a magnet production facility in Stillwater, Oklahoma.


Last year, the Trump administration invested in at least six minerals companies, including MP Materials, Trilogy Metals and Lithium Americas.

Some of the investments overlapped with the financial interests of people associated with the administration. The government did a funding deal with Vulcan Elements, a rare earths start-up three months after the president’s son Donald Trump Jr’s venture capital group invested in the company.

The commerce department and defence department have worked closely together to financially boost domestic rare earth production.

A condition of the government investment in USA Rare Earth was that the company raise at least an additional $500mn from investors. It is on track to raise more than $1bn because of high demand for the financing deal, which uses a mechanism known as a private investment into a public equity, often called a “Pipe”.

Cantor’s involvement comes as the investment bank once led by Lutnick, one of Trump’s most prominent cabinet members, has expanded its investment banking capabilities to benefit from the president’s “America first” agenda. Cantor did not play a role in advising on the US government investment in USA Rare Earth.

Shares in USA Rare Earth have more than doubled this year, helped by a 40 per cent jump this week. The company also sought advice from Cantor when it went public via a blank cheque vehicle in March last year.

FT : Robots only half as efficient as humans, says leading Chinese producer

Robots only half as efficient as humans, says leading Chinese producer
UBTech executive highlights difficulty in replacing workers with machines but manufacturers are still racing to order them

A leading Chinese humanoid robot maker has said its latest machines are at most half as efficient as human workers, underlining the challenges in deploying them to solve labour shortages and increase productivity.

Michael Tam, chief brand officer at Shenzhen-based UBTech, which has partnerships with carmaker BYD and Apple contractor Foxconn, said its Walker S2 robots were 30 to 50 per cent as productive as humans and only in certain tasks such as stacking boxes and quality control.

Yet manufacturers are still racing to order them to avoid losing out to competitors, Tam told the FT. “You can imagine . . . if Tesla has the advantage of deploying their own human robots into the manufacturing line, that means maybe BYD, they are staying behind.”

Chinese policymakers have thrown their weight behind the humanoid robot industry and encouraged deployment of AI-driven technology in factories, hoping industrial settings will prove to be a compelling use case.

The country accounted for more than half of global installations of industrial robots in 2024, largely consisting of traditional machines such as mechanical arms, according to the International Federation of Robotics.

Proponents of humanoid robots argue that their ability to move between production lines makes them deployable in a wider range of scenarios than traditional machines. Elon Musk has touted Tesla’s efforts to build its Optimus robot and spoken enthusiastically about fully automated factories.

Analysts have given mixed reactions to UBTech’s promotional videos, which show its robots carrying boxes between production lines and performing more difficult tasks such as replacing their own batteries.

They argue that humanoid robots present a more complex set of challenges than static arms or conveyor belts, including requiring independent power supplies, having a greater number of complex moveable joints and potentially engaging in tasks that require more advanced decision making.

For UBTech, one problem the company hoped to solve this year was developing a multifunctional hand, Tam said, as current Walker models require a human to switch the robot’s appendage for different tasks.

At a UBTech showroom last year, journalists were invited to shake hands with a non-industrial-use robot. It failed to respond at several points without repeated prompting from several attendants.

UBTech said it hoped to boost its Walker robot’s performance to 80 per cent of human performance by 2027. The company said it met a target to deliver 500 humanoid factory robots last year and that it aimed to produce 10,000 by the end of this year.

This week, it said it had signed an agreement with European aircraft manufacturer Airbus to supply the Walker S2. That followed a partnership with US semiconductor producer Texas Instruments signed last year, UBTech said.

Airbus said its collaboration with UBTech was at “a very early concept testing phase” and that the aircraft maker was “discussing potential future collaborations with various innovative companies in the industry”.

“Many deployment cases that you see, they are just at [a proof of concept] stage or demo stage and there are a lot of challenges before we really can see any commercial operation,” said Marco Wang, a Shanghai-based researcher at Interact Analysis.

He added that UBTech’s targets were “very ambitious”, noting that most humanoid robot deployments in China were in government-sponsored research centres. “That doesn’t really mean anything about commercial operations,” he said.

But Kelvin Lau, an analyst at Daiwa Capital Markets, said UBTech’s goals were feasible and that humanoid robots could be useful for factories not initially designed for automation.

“It should be gradually improving,” he said, noting that 80 per cent of human efficiency might suffice for factories given robots do not need to take breaks or holidays.

UBTech narrowed its losses in the first six months of 2025 to Rmb440mn ($62mn) from Rmb540mn the previous year. Revenues rose 28 per cent to Rmb621mn.

Research and development spending in 2024 was equivalent to 37 per cent of revenue, which mainly came from consumer and educational robots.

Its biggest listed competitors include Shenzhen-based Dobot Robotics and Tesla, according to a Daiwa report. Other Chinese producers include Hangzhou’s Unitree Robotics, X-Humanoid and AgiBot.

Tam said subsequent generations of the Walker robot would benefit from data collected in factories where it is currently deployed.

“The more human robots that could be deployed into the real world, the more real data could be collected,” he said. “And then, like a circle, it . . . [will] help human robots grow.”

FT : Footwear group On steps up push beyond trainers as clothing growth overtake

Footwear group On steps up push beyond trainers as clothing growth overtakes shoes
Roger Federer-backed Swiss brand widens focus to everyday apparel and accessories

On, the Swiss footwear group backed by tennis star Roger Federer, is accelerating a push beyond its signature sports shoes as growth in its clothing and accessories lines overtakes that of its core trainers business.

On’s co-founder Caspar Coppetti said apparel was now “definitely a standalone growth engine”, and that the New York-listed company wanted “to be a bigger part of our customers’ life”, rather than simply a brand associated with running or tennis shoes.

“The barrier between performance and lifestyle is artificial,” he said. “That’s not how consumers think any more.” The brand was now benefiting from a broader customer base, including younger shoppers who buy athletic gear as everyday clothing, he added.

The Zurich-based company, known for the distinctive “cloud” soles in its shoes, reported surging sales of apparel and accessories in the third quarter, up 87 per cent and 145 per cent respectively on a year earlier, against footwear growth of 21 per cent.

Founded in 2010, On has emerged as a challenger to sportswear’s dominant global brands such as Nike and Adidas, carving out a foothold through distinctive design and a focus on premium performance.

While apparel and accessories — a category that includes items from hats and socks to water bottles — remain much smaller revenue contributors than shoes, the gap in growth rates highlights the group’s widening focus beyond performance running into everyday wear.

Other sportswear groups including Lululemon and Nike have increasingly sought to position themselves as lifestyle brands, blurring the boundaries between technical performance and fashion.

Central to On’s strategy are its retail stores, where apparel accounts for 25 to 30 per cent of revenue, far higher than in wholesale channels. The company says it will open another 25 standalone stores in 2026, expanding its presence in regions including Asia and the Gulf.

Chief executive Martin Hoffmann said these “brand hubs” allowed On to “tell the apparel story” and present curated collections that reinforced the brand’s premium positioning.

The company expects a 34 per cent rise in net sales for 2025 to SFr2.98bn ($3.7bn).

Hoffmann said price rises introduced in July had not damped US demand, despite it being a market where retailers are offering lots of discounts, markdowns, sales and special offers to stimulate demand. “Our demand is extremely resilient across all age groups,” he said, noting strong gains among “younger, affluent teens”.

On’s expansion has been supported by high-profile collaborations. The group has had a partnership with fashion house Loewe since 2022 and recently worked with the brand to design a football-style sneaker.

A limited-edition collection with actor Zendaya sold out immediately, while releases with US brand Sky High Farm and Japanese streetwear label Beams target outdoor and consumers who want products that fit into their daily routine.

“For us, it’s really where we can connect in an authentic way with different communities,” Hoffmann said. “Not everyone is influenced by running.”

The company has already expanded into tennis, training and outdoor wear, but the executives declined to confirm which additional sports or categories might come next.

In 2025, On extended its technical partnership with the Swiss ski federation — covering training apparel and footwear for the nation’s winter sports teams — until 2034. The deal reinforces On’s presence in high-performance sport, although the company has said it does not intend to enter the ski equipment market.

“We like to have organic, authentic adoption before we engage,” Coppetti said. “We’re not sitting here looking at a spreadsheet of where else we could go.”

FT : Luxury bets on rich Americans and new designers to revive growth

Luxury bets on rich Americans and new designers to revive growth
Analysts expect high-end brands to start benefiting from the US’s ‘K-shaped’ economy in 2026

The luxury industry is relying on wealthy US consumers to power a recovery in spending in 2026, as a buoyant stock market and an influx of creative talent at some of the world’s biggest brands set the stage for a return to growth.

Sales are expected to increase by mid single-digit percentages this year after a bruising 2025 in which they are estimated to have flatlined. Analysts at Barclays and HSBC are projecting organic growth of 5-6 per cent and 6.5 per cent respectively across the industry. 

As the industry’s reporting season kicks off next week, Barclays analyst Carole Madjo expects the strong performance of the US stock market — the S&P 500 is near a record high — to translate into increased spending on luxury goods this year.

“Luxury companies really feel like there is now a cleaner correlation between wealth effects and luxury spending,” she said, citing a disconnect last year caused partly by the disruptive impact of US President Donald Trump’s tariffs.

That disconnect is now fading and the unpredictable political climate is “having less of an impact on the feelgood factor” among US shoppers, Madjo added.

The Americas was the standout region for Swiss group Richemont in the final quarter of last year. US demand for its Cartier and Van Cleef jewellery brands underpinned a 14 per cent rise in sales in the region, at constant exchange rates, to €1.74bn.

HSBC estimates that growth in luxury sales to US consumers will accelerate to 8 per cent in 2026, up from 2 per cent last year.

Brands eased off price rises in 2025 after increasing dramatic increases during the industry’s post-pandemic boom. This, combined with new creative talent — such as Jonathan Anderson at Dior and Matthieu Blazy at Chanel — bringing a fresh eye to product lines, is expected to provide a sales boost.

Meanwhile, investors should also see the benefits of cost cutting and portfolio reshaping at major luxury groups. Two such deals were announced this week: LVMH sold its travel retail business in China and Richemont offloaded its watch brand Baume & Mercier.

However, fourth-quarter results season may not provide much evidence of a rebound as companies face tough comparisons against the end of 2024 when there was a fleeting post-election bump in US spending last year.

On Tuesday luxury leader LVMH, which owns Dior, Louis Vuitton and Tiffany, is expected to report almost no organic sales growth in the fourth quarter, according to Visible Alpha consensus estimates. Sales at its bellwether fashion and leather goods division are expected to have fallen by 3.25 per cent. 

Industry growth this year will be driven by an increase in the number of products sold as opposed to price increases for the first time in decades, according to HSBC. Consultancy Bain has estimated that prices on most luxury clothing, bags and shoes are 1.5 to 1.7 times more expensive than they were in 2019. 

However, there are still doubts hanging over any rebound. While the Chinese market is expected to stabilise after a dismal two years — sales have fallen every quarter over that period, according to Bain — there is little sign that demand in the country will return to its former heights anytime soon. 

Luxury groups also have a fight on their hands to win back the less affluent customers they alienated with years of aggressive price rises.

Brands are refocusing on the cheaper end of their ranges — products typically priced between €1,000 and €2,000 — to tempt back shoppers who have been priced out. A recent Louis Vuitton campaign focused on its signature monogram bags that start from about €1,500, a rare occurrence for a brand that usually focuses its advertising on splashy new products.

But analysts caution that the US’s increasingly K-shaped’ economy — in which asset-owning households are becoming wealthier and asset-light households are scraping by — could jeopardise efforts to win back luxury’s more “aspirational” consumers.

Despite the uncertainties, Erwan Rambourg, global head of luxury at HSBC, hailed the industry’s return to volume growth as a clear sign of revival.

“What counts will be the reality that consumers finally have a good reason to go back and visit stores,” he said.

>>> Barron’s Weekend Summary

Cover:
-Five years ago, the GameStop phenomenon nearly caused a collapse of the global financial system, highlighting vulnerabilities in financial markets. This event, described by Thomas Peterffy of Interactive Brokers as a time of intense fear, was fueled by retail investors purchasing GameStop shares on margin, allowing brokers to lend these stocks to short sellers. Despite initial calls for substantial regulatory reforms, the essential mechanisms that could have exacerbated the situation remain largely unattended to. In the aftermath, while regulators worked to address systemic weaknesses, brokerage firms adapted to a new landscape where retail trading surged. Trading volumes remained high as individuals embraced investing with increased enthusiasm, frequently participating in speculative activities in various markets. The GameStop stock reached a record high of $120.75 on January 28, 2021, coinciding with brokerages like Robinhood pausing purchases due to rising deposit demands from clearing corporations, underscoring ongoing regulatory challenges.

Interview:
-Joseph Dominguez, the President and CEO of Constellation, spoke about various global energy topics during an interview at the World Economic Forum in Davos, Switzerland. He highlighted the significant growth in the electric vehicle (EV) industry, indicating a consistent increase in demand. Additionally, Dominguez addressed President Donald Trump's proposal for an emergency power auction aimed at lowering electrical bills in the Mid-Atlantic region, emphasizing unprecedented levels of energy demand not observed in a long time. He also discussed the impact of hyperscalers on the energy system, reflecting on the evolving landscape of global energy needs and strategies.

Tech Trader:
-Artificial-intelligence companies anticipate that by 2026, autonomous agents—software utilizing AI language models—will be able to execute complex tasks based on simple instructions. However, this technology introduces significant security risks, particularly through prompt injection attacks, which exploit agents' autonomy and data access. According to CrowdStrike President Michael Sentonas, prompts could evolve into a new form of malware, posing dangers as agents gain access to sensitive systems. Companies like Microsoft and Salesforce are keen on promoting these agents for workflow automation, while consumer-focused tools also emerge. The risk of prompt injection stems from untrusted sources, where misleading commands can be concealed, leading agents to execute harmful actions if they possess adequate permissions.

The Trader:
-Geopolitical uncertainty has become a defining characteristic of global security, particularly during President Donald Trump’s second term, influencing the defense sector, which has seen a 55% increase in value over the past year. With global military spending surpassing $2.5T in 2025 and projected to exceed $3T by 2027, there is significant growth potential in defense stocks. Increased military activity is beneficial for defense companies, while the perception of the US as an "unreliable ally" could ultimately favor the European defense industry, though the effects may take time to materialize. Prominent recommendations in the US include General Dynamics, known for its submarine and tank manufacturing, and L3Harris Technologies, a leader in defense electronics which is in the process of spinning off its missile division into a separately traded public entity. This spinoff is anticipated to attract a $1B investment from the US Department of War, enabling expansion operations. Analyst Sheila Kahyaoglu from Jefferies perceives that this transaction could yield a 30% combined gain for L3Harris and the new missile-focused entity, as missile businesses typically command higher valuations than their more diversified counterparts.
-Shares of Birkenstock, the German footwear brand, have stagnated since their 2023 IPO, experiencing a 25% decline in value in 2025 and a further 4% drop in 2026, currently priced at $39.38. Despite a first-quarter revenue growth announcement matching expectations, external factors such as the depreciated U.S. dollar against the euro and concerns over potential European tariffs have negatively impacted investor sentiment. The upcoming investor day is anticipated to introduce new multiyear targets that may refresh revenue and profit forecasts, providing a possible catalyst for stock recovery. Analyst Matthew Boss from J.P. Morgan predicts a strategic plan to increase revenue by $1 billion over the next three years, likening this to a necessary reset for the company. Although enthusiasm for the stock is low, projections suggest a 10% earnings-per-share growth for the current fiscal year and a 20% increase for the next, with shares trading at 13 times the anticipated EPS for 2027, slightly below the historical average.

Features:
-AIG stock experienced a significant decline of 7% in early January 2026, after CEO Peter Zaffino announced his upcoming resignation, which has contributed to a 14% year-to-date drop. Currently trading below its book value of $75 per share and at a price-to-earnings ratio of nine times estimated earnings for 2026, AIG appears undervalued compared to its peers. The company targets a 20% annual increase in earnings per share from 2025 to 2027 and raised its dividend by 12.5% in 2025. Despite the decline in stock price, which recently reached a 52-week low of $72, investment professionals see the company as a potentially cheap investment opportunity, given its successful turnaround from the near-collapse during the 2008-09 financial crisis. Colin Hudson, a co-manager of the Oakmark Equity and Income fund, acknowledges Zaffino’s pivotal role in enhancing the company's performance and expresses confidence in AIG's future stability under Zaffino's continued chairmanship.
-BJ’s Wholesale Club Holdings has established itself as a leading discount retailer, attracting 8M members across 260 locations, with successful expansion efforts into new states like Alabama and Texas. Jefferies analyst Corey Tarlowe has a bullish outlook on the stock, setting a price target of $120, which signifies a 27% upside from the current trading price of $94.65. This optimism is supported by BJ’s innovative growth strategy, which has resulted in 12 consecutive quarters of market share gains and a rise in club traffic, alongside increasing same-store sales contributing to record profits. Despite this success, the stock is trading at a price-to-earnings ratio of 20, significantly lower than industry peers such as Costco and Walmart, indicating a potential undervaluation. With shares down 22% from their 52-week high, this presents a promising buying opportunity for investors ahead of expected growth in 2026 and beyond.

Europe:
-Treasury Secretary Scott Bessent characterized Denmark's investment in US government debt as "irrelevant," pointing to its shrinking stake compared to larger European counterparts like Belgium and France. While Denmark's $9.88B Treasury holdings are small, the recent decision of a Danish pension fund to divest its $100M in Treasuries is significant as it may embolden other nations to consider alternatives. Denmark has reduced its US debt holdings from $18.69B in 2020, reflecting waning reliance over time. Although Denmark's influence on the $30.3T Treasury market is limited, a broader trend of selling by larger countries could challenge US financial stability. President Trump indicated a strong adverse response to any such actions by Europe, asserting that the US has "all the cards." Nonetheless, the US dollar's prominence remains robust, with 57% of global foreign-exchange reserves held in dollars, indicating that complete divestment from US assets is impractical for Denmark or any country. Denmark's central bank maintains the option to hold Treasuries but is not obligated to do so.

Emerging Markets:
-No update

Commodities:
-Silver has experienced a remarkable surge, increasing over 200% within the past year, including a 34% rise in January. It currently trades around $94/oz., significantly outperforming gold, which has risen by 74% in the same period. Unlike gold, silver's appeal stems not only from its status as a safe-haven asset but also from its industrial applications, with 60% of demand now linked to its use in electronics, solar panels, and electric vehicles. This increasing industrial demand is coupled with potential supply shortages since most silver is produced as a byproduct of other metal mining, leading to a persistent demand-supply deficit, which stood at 18% last year. However, silver's price rise may not be entirely justified by these fundamentals, as it often behaves like a volatile small-cap stock, showing a beta of 1.4 against gold.
Market analysts express concerns regarding silver's current valuation, noting that at $94, it is more than double its 200-day moving average of $46. As David Morrison from Trade Nation remarks, the market appears to be in a precarious position, hinting at the potential for significant price fluctuations moving forward.

Streetwise:
-A decade ago, AbbVie faced a significant patent cliff, signaling the end of exclusivity for its blockbuster drug Humira. Despite initial concerns, the company’s stock has surged 460% since then, outperforming the market significantly. Launched in 2002 by Abbott Laboratories, Humira was pivotal in the development of monoclonal antibodies, effectively targeting immune-triggered inflammation across multiple autoimmune diseases. Although US drug patents last around 20 years, with actual sales exclusivity typically shorter, AbbVie strategically managed Humira's patent expiration in December 2016, which accounted for 63% of its revenue at that time, through a complex web of additional patents, delaying competition by two years. Humira's sales peaked at $21.2B in 2022, surpassing expectations from the original patent cliff year. This robust cash flow enabled AbbVie to invest in next-generation autoimmune treatments, Skyrizi and Rinvoq, which are projected to generate combined sales of $31B this year, increasing to $50B by 2030. Despite Humira's eventual decline, AbbVie’s stock rose from a low forward price/earnings ratio of 11 to a healthier 21. Other drug companies like Merck and Bristol Myers Squibb face similar patent expirations but may not replicate AbbVie's success.

>>> Weekend Press Summary

FINANCIAL TIMES
-Demis Hassabis, chief of Google DeepMind, highlighted concerns over the AI sector's investment patterns, likening them to a “bubble”. Speaking at the World Economic Forum, he noted that substantial seed investments in startups lacking concrete products or technologies appear unsustainable and may necessitate market corrections. This warning contrasts with sentiments from other tech leaders present in Davos, such as Jensen Huang from Nvidia and Satya Nadella from Microsoft, who dismissed over-investment worries. The rise of companies like Thinking Machine Lab, recently valued at $10B with minimal transparency on its offerings and its recent loss of key personnel, further raises eyebrows among investors regarding long-term viability.
-PresidentDonald Trump's push for a complete purchase of Greenland has strained transatlantic relations and risks undermining NATO's mutual defense agreements. Although prior predictions about the breakdown of Atlanticism have not materialized due to Europe's dependence on U.S. military support, ongoing identity shifts—where Europeans emphasize sovereignty and international cooperation, while Americans pursue global dominance—signal escalating tensions. The transition from a unipolar to a multipolar world marks a significant change in power dynamics, leading to unpredictability and uncertainty in global relations. This evolving landscape challenges the notion of a straightforward return to Cold War-like structures, complicating the geopolitical framework.
-The US plans to enhance its military presence in the Indo-Pacific to prevent China from obstructing American access to this economically vital region, as per a new national defense strategy released by the Pentagon. This strategy emphasizes homeland defense, particularly in the western hemisphere, and aims to deter China while fostering US trade from a position of strength. Unlike the previous administration’s approach, this document adopts a more conciliatory stance on China and omits specific references to Taiwan. It links US security to maintaining access in the Indo-Pacific, warning that Chinese dominance could restrict American engagement in this critical area. Additionally, the strategy encourages allies to enhance regional defense and outlines plans for a robust defense system along the first island chain, which includes Japan, Taiwan, the Philippines, and other key locations.
-Japan's currency, the yen, rose significantly by 1.7% against the US dollar to ¥155.7 on Friday, marking its largest rally in nearly six months amid speculation of potential government intervention. This surge followed a "rate check" conducted by the New York Federal Reserve, which is often a signal for market intervention, requested by the US Treasury. The exact nature of any communication between Washington and Japanese authorities remains unclear, although the yen has faced substantial selling pressure in recent months.
-Rick Rieder, a BlackRock executive, is becoming a leading candidate for the Federal Reserve chair as President Trump prepares to make his nomination. Rieder's odds on Polymarket have increased from 6% to 47%, marking him as the top contender. This surge comes amid Trump's ongoing tension with current chair Jay Powell over interest rates. The Treasury has reportedly engaged bond investors about Rieder, while former Fed governor Kevin Warsh is also considered a strong candidate. Rieder has extensive experience in the markets, managing BlackRock's $2.4T bond strategies and previously working at Lehman Brothers.
-Gold experienced its best week in nearly 20 years, hitting nearly $5,000 per troy ounce, while the dollar faced its worst performance since May, driven by concerns over US policymaking amidst the Greenland crisis. Silver also surged above $100/oz. Analyst Rhona O’Connell noted that investors are hedging against uncertainty, underlining gold's role as a safe asset. Following President Trump's tariff threats against European allies, Wall Street reacted negatively, although stocks rebounded after his subsequent reversal. Despite this, the dollar index dropped by 1.9% this week, contributing to gold's more than 8% rise, its largest weekly gain since the 2008 financial crisis.
-The Kurdish self-rule experiment in Syria is facing a critical decline as the Syrian government, backed by the US, reclaims territory from the Syrian Democratic Forces (SDF). US envoy Tom Barrack stated that the SDF's role has diminished, urging Kurds to align with President Ahmed al-Sharaa, who has redefined Syria's political landscape post-Bashar al-Assad. This shift is viewed by the Kurds as a betrayal, especially after their sacrifices in fighting Isis. Sharaa's Islamist rule raises concerns among Kurds, who fear a return to the chaos they initially fought against. The SDF formed amidst Syria’s civil war with US support, but their alliance has become strained due to shifting political allegiances.
-Abelardo de la Espriella, a controversial criminal defense lawyer, is the leading opposition candidate in Colombia's upcoming election, positioning himself as tough on crime and advocating against the leftist policies of outgoing President Gustavo Petro. De la Espriella, who represents high-profile figures including paramilitaries and fraudsters, frames the election as a critical choice between freedom and tyranny. With Petro unable to seek re-election, he supports leftist senator Iván Cepeda, marking a shift in the nation’s political landscape.
-Pope Leo XIV will meet key executives from the mining and energy sectors, including leaders from BHP and Vale, at the Vatican to discuss ethical approaches to resource extraction. Scheduled for 11 am on Saturday, the private audience signifies the Pope's initial stance on industry relations. Unlike his predecessor, Pope Francis, who adopted a confrontational tone regarding extractive industries, Pope Leo is expected to take a more pragmatic approach, balancing concerns for vulnerable populations with the church's emphasis on human dignity. Severine Deneulin, co-author of a Vatican report on mining, highlights the church's commitment to protecting human welfare amidst increasing competition for resources.

NEW YORK TIMES
-An FBI agent, Tracee Mergen, resigned from her position after facing pressure from bureau leadership to cease a civil rights investigation into Immigration and Customs Enforcement officer Jonathan Ross, who fatally shot unarmed civilian Renee Good in Minneapolis. Mergen's resignation reflects ongoing concerns regarding the Justice Department's handling of the shooting incident, which occurred on January 7, 2026. Her departure highlights broader implications for accountability in such cases, as inquiries into officers involved in fatal shootings are standard investigative procedures.
-There is emerging apprehension among Republican voters regarding the Trump administration's immigration enforcement, particularly the ICE raids. During recent discussions in Louisiana, even conservative voters expressed concern about the impact of these actions, exemplified by a comment from a supporter who felt that U.S. citizens were being unfairly targeted alongside criminals. This sentiment of wariness is reflected in polling and remarks from GOP figures such as JD Vance, indicating a growing unease within the party about the immigration crackdown. The piece highlights the evolving perspectives among Republicans as they navigate the complexities of immigration policy and its effects on their constituents.
-Thousands of protesters took to the streets of Minneapolis-St. Paul on Friday, effectively shutting down parts of the cities in a large-scale demonstration against the ongoing immigration crackdown that has impacted the area for several weeks. This protest was characterized by subzero temperatures and was the most extensive and organized response since federal agents began their operations in the Twin Cities over six weeks ago. The primary goal was to urge the federal government to retract the deployment of thousands of federal agents from the streets. Many locally owned businesses chose to close their doors that day, prioritizing the protest over economic activity. Alison Kirwin, owner of Al’s Breakfast, expressed the sentiment of the moment, stating that sacrificing a day's revenue was a worthwhile cost in the fight for change.
-Prime Minister Mette Frederiksen of Denmark paid an unannounced visit to Greenland on January 23, 2026, amid ongoing discussions concerning Greenland's future and U.S. interest in the territory. The visit aimed to reassure the island's residents, who number around 57,000. Frederiksen met privately with Greenland's Prime Minister Jens-Frederik Nielsen before engaging in public activities that included visiting a kindergarten and greeting local officials. This diplomatic gesture appears to have been influenced by pressure from President Trump, who has expressed a strategic interest in Greenland, citing national security concerns.
-Decades ago, the United States had a significant military presence in Greenland, characterized by thousands of troops, numerous bases, strategic bombers, weather stations, and an extensive facility under the ice. Currently, only the Pituffik Space Base remains active, serving as a remote missile defense station. Some former bases have been converted into commercial airstrips, while others are in disrepair. President Trump has expressed a desire for a renewed US presence in Greenland, emphasizing national security concerns and hinting at potential compromises regarding land ownership for military bases. However, both Greenland and Denmark have resisted ceding sovereignty, raising doubts about the feasibility of such plans.
-Last year, anti-abortion activists gathered in Washington for their annual March for Life, seeking to expedite efforts to restrict abortion access under President Trump. However, this year's march on the National Mall was marked by a mix of optimism and frustration. Despite progress in placing allies in policy positions, Trump has occasionally disappointed this group, highlighting internal divisions within a movement that has been pivotal for his political success. Last fall, the FDA approved a generic version of the abortion pill mifepristone, which opponents want to ban. Recently, during Congressional discussions on health care subsidies, Trump suggested that Republicans might need to be "a little flexible" regarding the Hyde Amendment, which prohibits federal funding for abortions.
-The United States military conducted a boat strike on Friday in the eastern Pacific, suspected of drug smuggling, resulting in the deaths of two individuals. This operation, reported by the U.S. Southern Command, is the first confirmed strike since the capture of Venezuelan leader Nicolas Maduro. The military stated the target was a vessel navigating known narco-trafficking routes and confirmed one survivor, prompting a search-and-rescue effort by the Coast Guard. This strike raises the total fatalities attributed to the Trump administration's anti-drug smuggling operations to 125 since early September, marking the 36th military action of this campaign. The last confirmed strike prior to this was on December 31, which resulted in five deaths. Legal experts and some Congressional members have raised concerns, labeling these strikes as potentially illegal extrajudicial killings or war crimes.
-Gen. Dan Caine, Chairman of the Joint Chiefs of Staff, is set to hold a significant meeting on February 11, 2026, in Washington, inviting military leaders from 34 countries, including Denmark, Britain, and France. This gathering underscores the increasing importance of the Western Hemisphere in U.S. foreign policy under the Trump administration. The primary focus of the meeting will be to enhance regional collaboration in combating drug trafficking and transnational criminal organizations. This meeting follows a U.S. commando raid that captured Venezuelan President Nicolás Maduro and ongoing tensions regarding U.S.-European relations over issues such as Greenland, potentially reflecting the administration's revised security strategy and the implications of the "Donroe Doctrine." This rare assembly of military chiefs signals a strategic pivot towards prioritizing military coordination in the region amidst current geopolitical challenges.
-China's highest-ranking general, Zhang Youxia, has been placed under investigation for "grave violations of discipline and the law," as announced by the Defense Ministry. This marks a significant escalation in President Xi Jinping's ongoing purge of the People’s Liberation Army elite. Zhang, who served as the vice chairman of the Central Military Commission, had previously been seen as a trusted ally of Xi. The announcement also revealed that General Liu Zhenli, another high-ranking military official, is under investigation. This move is part of Xi’s broader campaign against corruption and disloyalty within the military's leadership ranks.
-Blockchain-based cash transfers are emerging as an innovative solution in Afghanistan, with start-up HesabPay aiming to revolutionize humanitarian aid delivery in conflict-affected regions. Founded by Afghan American entrepreneur Sanzar Kakar, HesabPay allows swift, fee-efficient digital wallet transfers, bypassing traditional banking systems and government controls. The platform supports 86,000 families in Afghanistan through the involvement of the United Nations High Commissioner for Refugees and has expanded to assist victims in Syria, with plans to extend to Sudan and Haiti. The initiative addresses the financial challenges exacerbated by the U.S. withdrawal and subsequent sanctions on Afghanistan, providing essential aid directly and efficiently.

NY POST
-Former US President Bill Clinton faces potential contempt of Congress charges after the Republican-controlled House Oversight Committee voted 34-8 in favor of holding him in contempt for ignoring a subpoena related to the Epstein scandal. Notably, only a minority of Democrats supported Clinton, marking a shift from past support during previous scandals. Hillary Clinton was also voted to be held in contempt but by a narrower margin. The matter will move to the full House for expected approval and then to the Justice Department for possible prosecution, raising concerns about a serious indictment against both Clintons. Bill Clinton argues he is a victim, claiming his offer to testify under certain conditions was dismissed by the committee.
-Anti-ICE demonstrators, including activists and clergy, converged at the Target Center in downtown Minneapolis to protest against federal immigration enforcement following the shooting of Renee Nicole Good by an ICE agent. The “ICE Out of MN: Day of Truth and Freedom” march drew thousands who advocated for a halt to ICE activities through chants and signs, despite frigid temperatures. Participants called for a day of no work, no school, and no shopping. Inside the arena, smaller groups continued their demonstration, while security measures were in place outside the venue. City Council member Elizabeth Shaffer praised the turnout on social media.

Electrek : China shuts down Elon Musk’s claim that Tesla FSD will be approved ne

China shuts down Elon Musk’s claim that Tesla FSD will be approved next month

Just as Tesla investors were getting excited about a potential rollout of Full Self-Driving (Supervised) in its second-largest market, China has reportedly shut down Elon Musk’s latest timeline.

According to a new report from Chinese state media, Musk’s claim that FSD would be approved “next month” is simply “not true.”

This feels like a case of “Elon time” meeting China’s no-nonsense.

Yesterday, Elon Musk made a splash at the World Economic Forum in Davos, claiming that Tesla FSD could be approved in Europe and China as soon as next month.

The comment sent Tesla (TSLA) stock ticking upward, as the Chinese market is seen as a massive revenue opportunity for Tesla’s software division. Musk specifically said he hoped for approval in Europe in February, adding, “and then maybe a similar timing for China.”

But less than 24 hours later, China is pouring cold water on that timeline.

China Daily, a state-run English-language newspaper often used by the government to signal official stances to the West, published a report today citing a “reliable source” close to the government.


The source bluntly stated that Musk’s claim of an approval next month is “not true” and that the timeline does not align with the current regulatory reality.

The report suggests that while Tesla has made progress with data security clearances, specifically following Musk’s surprise visit to Beijing back in April 2024, the full approval for a supervised autonomous driving system on public roads is not imminent for February 2026.

This isn’t the first time we’ve been down this road. Back in late 2025, Musk told shareholders that approval would likely come in early 2026, a slight delay from his previous prediction of “by the end of the year.”

Tesla has been laying the groundwork for FSD in China for years. In 2024, the automaker partnered with Baidu for lane-level mapping and navigation, a prerequisite for operating autonomous systems in the country due to strict surveying laws.

Despite the mapping deal and clearing some data security hurdles, it seems the final rubber stamp from Beijing remains elusive.

Electrek’s Take
This is classic Elon Musk optimism/borderline lying clashing with reality.

To be fair, Musk did say “hopefully” and “maybe” regarding the timeline, some of his favorite words, but he knows exactly how those words are interpreted by investors and the media. He says “next month,” the stock jumps, and then we find out later it’s actually six months, or years, away.

That said, the fact that Chinese state media is responding so quickly and specifically to Musk’s comments is interesting. It shows they are paying close attention.

Tesla FSD is arguably more critical in China than anywhere else. Local competitors like XPeng already have very capable city-driving ADAS working in major cities, and they don’t have the same data gathering limitations as Tesla.

Either way, I’m not as optimistic about Tesla’s FSD rollout in China as Tesla shareholders clearly are. That’s because several other companies are releasing similar products included in the price of the vehicles, which are already lower than Tesla’s prices.

Ultimately, I think Tesla will find it hard to sell its supervised FSD in China.