TheChek News Flow

A curated guide to standout art shows, new retail concepts and cozy hangouts as L.A. eases into the cooler season.

Los Angeles in the fall awakens the senses. From immersive exhibitions and fresh retail concepts to intimate dining experiences, here’s a look at new art, shopping, cocktails and culinary spots — each offering warm, inviting spaces to linger and take it all in.

The Hammer Museum unveils Made in L.A. 2025, the seventh edition of its biennial spotlighting artists across L.A. Running Oct. 5 through March 1, the exhibition features 28 creatives working in painting, sculpture, video, installation, music and performance. The show, curated by Essence Harden and Paulina Pobocha, examines how artists engage with the city’s layered history and architecture. Highlights include new works by multigenerational painters including Greg Breda, Ali Eyal, Hanna Hur, Beaux Mendes and Patrick Martinez, and a stage play by Leilah Weinraub in collaboration with New Theater Hollywood. As always, admission to the Hammer is free.

“While there are as many ideas circulating through the show as there are materials, an inquiry into one’s relationship to the city of Los Angeles animates much of the work we will present,” the curators said in a joint statement. “Neither myth nor monolith, this city is many things to many people, and its cacophonous disorder is, perhaps, its most distinguishing feature.”

Tavares Strachan is presenting his largest L.A. exhibition at the Los Angeles County Museum of Art, opening Oct. 12 and running through March 29. The show features more than 20 new works, including the artist’s most ambitious neon piece, and a series of carefully constructed environments; across seven galleries, audiences encounter a laundromat, a barbershop and a rice field as part of a multisensory experience. Through his work, Strachan examines histories often overlooked in mainstream narratives, particularly those connected to the Black diaspora, encouraging viewers to reconsider which histories are celebrated and how they are represented.

New Th!ngs, an 800-square-foot concept store in L.A.’s Highland Park blending art, design, music and fashion, opened its doors with a preopening gallery show, “Goofy Foot,” on Sept. 25 by photographer Tobin Yelland, attracting guests including Spike Jonze. For founders Brody Baker and Kon Trubkovich, who run the global creative agency and venture studio BEZ, it’s a shop designed to cultivate community.

“I think ultimately it boils down to just creating a physical place to celebrate the BEZ collective’s creativity, creative execution through various mediums and being able to create a community in a physical world again,” said Baker, a multidisciplinary creative director, filmmaker, curator and marketing strategist. “I think we’re exhausted by the digital space. People are hungry for community in real life.”

The space, which also houses BEZ’s L.A. headquarters and the offices of indie label +1 — with Baker and Trubkovich serving as creative partners — will offer a mix of art, home decor, fashion, jewelry, accessories and a broad “objects” section featuring books, zines and curiosities.

“We want people to feel like they belong,” added Trubkovich, a visual artist working across painting, drawing and video.

The founders envision the store evolving organically as a blank canvas shaped by the neighborhood and scene.

“It is vibrant, and it has a very rich creative history,” Baker said of Highland Park. “It really does remind me of Brooklyn, like, 20 years ago. That’s interesting to me, because I feel like it’s right at the cusp. Down the block La Labo is opening, but also next to us is a bootleg flower shop out of this woman’s home. We are New Yorkers so Highland Park feels very new. It’s the perfect spot at the perfect time.”

The cofounder of vegan spot Monty’s Good Burger, Lexie Jiaras, teams up with designer Elizabeth Weinstock on a new retail destination called Cleo. The 1,400-square-foot store is located in Beverly Grove on West 3rd Street, a building owned by Weinstock since 2012 and previously used as the headquarters for her exotic-skin accessories label.

Opened in September, Cleo is focused on bringing buzzy, digital-first fashion and accessory brands into a physical space.

“The inspiration for Cleo came from a personal desire to experience online fashion culture in real life,” Jiaras said. “There are so many incredible brands that have cultivated a community on social media, yet customers still crave an in-person experience. The barrier to entry for an emerging brand to open their own brick-and-mortar is so high. We figured we could solve for two things at once, getting these brands in a retail environment and giving customers the in-person shopping experience they crave.”

Visitors can explore ‘90s and Y2K-inspired labels such as Fanci Club, Bella Venice, Amelie Teje, Angel Moon, Gem Wear, as well as accessory brands Mudd Pearl, Rockii Studios, Emma Pills, Tarina Tarantino and Wildflower Cases, along with Claudia Sulewski’s beauty brand Cyklar.

The space doubles as a hangout, with a café serving Jiaras’s matcha line @good.boy and lounge areas.

The team behind The Benjamin Hollywood — Ben Shenassafar, Jared Meisler and Kate Burr — unveiled a cocktail bar upstairs, with a menu created in collaboration with mixologists Jason Lee (n/soto, Baroo) and Chad Austin (The Mulholland, Bootlegger Tiki). It delivers unexpected twists on classics — like the $19 Campfire, a s’mores-inspired Old Fashioned made with graham cracker-infused bourbon. For martini lovers, there’s the choice between the $24 Dirtier Martini, made with Tito’s vodka and the bar’s signature dirty mix, garnished with olives and capers, or $35 Ben’s Martini, with Monkey 47 gin, Noilly Prat Dry Vermouth and lemon oil, served with a side of chips. But the showstopper is the $20 Inherent Vice, a riff on the Miami Vice that pairs a strawberry daiquiri ice cube with a sidecar of clarified piña colada milk punch, rich with rum and a hint of allspice. Bar snacks complement the drinks, including $190 chips and caviar (1 oz. of Golden Osetra), $24 Mustard’s Bagels steak tartare and $12 almond trio in cool ranch, salt and vinegar and sweet heat.

Tucked above Cipriani Beverly Hills lies an intimate jazz club that’s easy to miss; but if you know, you know: past the entrance and up the stairs is a whole other vibe. The ambience captures the charm of Hollywood’s Golden Age, as servers glide by in crisp white tuxedo jackets amid a decor of slender palm fronds that curve above zebra-striped banquettes. Much like downstairs, the menu showcases Cipriani’s signature Italian cuisine (including the popular $29 baked eggplant “alla Parmigiana”), alongside decadent seasonal options like oysters, caviar and truffles — with strong cocktails to keep the night going. Wednesday is the night to go: buzzing but not too packed, with a live band that channels the spirit of a 1930s speakeasy.

Berenjak, the Persian restaurant founded in London by chef Kian Samyani, has unveiled a West Coast outpost at Soho Warehouse in L.A.’s Arts District — its first U.S. location open to the public. (Other restaurants are in Dubai, Sharjah and Doha, along with Soho House residencies at Soho Farmhouse in Oxfordshire and DUMBO House in New York.) Inspired by Tehran’s kabab houses, Berenjak is a warm and candle-lit dining experience built around sharing. The menu features coal-grilled kababs such as the $28 Koobideh (minced lamb shoulder with onions and black pepper), the $34 Jujeh (saffron-marinated chicken) and seasonal specials like the $38 Meygoo Kabab (barbecue prawns with Kashmiri chili), alongside signature small plates including the $15 black chickpea hummus — enjoyed with $8 Taftoon and Sangak flatbreads. Drinks span from traditional Persian sharbats to inventive cocktails, including the $19 Salted Plum and Marigold Margarita, made with Marigold tequila, plum wine, saline, plum jam and lime.

The tech giant is trying to have it both ways regarding how its search business will fare

Liz Reid, the Google search boss, has a tough job.

She’s going around trying to convince the public that artificial intelligence hasn’t killed Google’s golden goose—the search business that makes up more than half of parent-company Alphabet’s GOOGL -2.05%decrease; red down pointing triangle sales.

At the same time, Google’s lawyers are working to convince federal judges determining the company’s fate that, in fact, AI poses a huge threat to its monopoly businesses.

So which is it? I asked Reid as much during Friday’s episode of the “Bold Names” podcast. “This is really an expansionary moment,” she said. “So both Google can grow very successfully, and other people can grow successfully.”

OK, but the conventional wisdom among many in Silicon Valley is that AI-powered chatbots and assistants will replace the need for search. Users will simply ask OpenAI’s ChatGPT or xAI’s Grok for answers to what they would have previously sought out using Google.

Reid counters that the advent of AI chatbots is helping fuel users wanting more information. So whether they seek it out the old-fashioned way (by googling it) or new ways (by asking ChatGPT), the overall pie of people wanting to discover information is growing.

That helps explain why the company says the number of search queries is up while, at the same time, its market share has eroded slightly—falling below 90% this year, to levels not seen in roughly a decade, according to researcher Statcounter.

One of the winners is Microsoft MSFT -2.19%decrease; red down pointing triangle. It has moved quickly to integrate partner OpenAI’s AI models—branded as Copilot—into its Bing search page.

But with 3.98 % global market share, Bing, the No. 2 player behind Google, has little fizz. In other words, Microsoft isn’t even Pepsi to Google’s Coke. It is more like RC Cola.

During one of Google’s two landmark antitrust trials, Microsoft Chief Executive Satya Nadella suggested to a judge that more than just advances in AI were needed to overcome Google’s search dominance, especially on mobile phones.

“The distribution advantage Google has today doesn’t go away,” he told a judge in 2023. “In fact, if anything, I worry a lot that—even in spite of my enthusiasm that there is a new angle with AI—this vicious cycle that I’m trapped in could even become even more vicious because the defaults get reinforced.”

His argument was backed up in a recent lawsuit by billionaire Elon Musk against Apple AAPL -3.45%decrease; red down pointing triangle. The suit is over that company’s special relationship with OpenAI that powers some AI chats on iPhones.

Musk’s companies xAI and X are arguing the iPhone is crucial to help usher in competing AI chats. They argue the Apple-OpenAI relationship gives ChatGPT an unfair advantage, even if Musk is gambling that eventually AI chats will usurp Apple’s ecosystem.

Both Nadella’s and Musk’s positions highlight the importance of the mobile-phone user—the data they’re generating—for the AI future.

It was a point further underscored in emails between Apple executives that were made public as part of the Google litigation. The case showed the close relationship the two giants have around search.

At one point, Apple was evaluating a potential acquisition of Bing. But executives held clear reservations.

“Not having mobile queries at scale is a huge liability for them since the most important search signal is engagement,” one of Apple’s senior executives told another about Microsoft’s Bing. Apple didn’t go through with a deal.

In its defense, Google lawyers often noted that a top search query on Bing was “Google.”

Ultimately, the judge ruled Google’s search was an improper monopoly, but delivered remedies that fell short of what the Justice Department was seeking. In large part, that was because of the threat that so-called generative AI poses to search.

“The emergence of GenAI changed the course of this case,” Judge Amit Mehta wrote in his Sept. 2 opinion.

Now, in another antitrust case against Google, the tech giant is arguing AI is disrupting its ad business. This also has been found to be a monopoly by a different federal court, considering remedies of its own.

Ahead of that recent bench trial in Alexandria, Va., Google lawyers argued in a filing that the ad industry was already seeing significant disruptions.

“Even at the liability stage a year ago, the Court heard about ad-tech products that are continuing ‘to integrate artificial intelligence and machine learning capabilities,’ including tools that facilitate ad purchasing across channels,” the filing said. “In the time since, the changes wrought by AI have only come faster.”

In its more than 20 years, Google has successfully adapted to changing technology. This included acquiring Android to put it directly into mobile computing. That bet helped place Google—along with Apple—as a gateway for users to the digital world through its app store.

To combat AI, Google has rolled out what it calls AI Overviews. These use a custom Gemini-based model to give users a summary of search results along with links to explore the sources on the web.

The tool already has more than two billion monthly users, according to the company. Google also has rolled out an AI Mode to directly compete against chatbots.

And Alphabet’s financial results show things are still cooking at the Mountain View, Calif., company. Search revenue rose 12% in the second quarter from a year earlier, to a record $54.2 billion, the company reported in July.

Still, data suggests users of AI Overviews aren’t clicking on links as much.

Search boss Reid didn’t seem fazed. Whether a person is searching deeply for information on sneakers to buy or asking an AI chat about shoes, the user still must click on a link to actually buy those new kicks.

“None of the AI [answers] substitute the need for the actual pair of shoes,” Reid said. “So you’re still likely to click through even if you’re doing research initially.”

And that’s really Google’s business: connecting buyers with sellers. Not search.

Thinking Machines Lab Co-Founder Departs for Meta

Andrew Tulloch is the latest big-name AI researcher to join the social-media giant

A co-founder of Mira Murati’s Thinking Machines Lab has left to join Meta Platforms META -3.85%decrease; red down pointing triangle, the startup confirmed Saturday.

Andrew Tulloch, a star AI researcher, confirmed his departure in a message to employees on Friday, according to people familiar with the matter.

“Andrew has decided to pursue a different path for personal reasons,” a spokeswoman for Thinking Machines Lab said in a statement.

Tulloch is a leading researcher in the field of artificial intelligence and previously worked at Meta for 11 years. He left in 2023 to join OpenAI for a stint before co-founding Thinking Machines Lab alongside Murati at the start of this year.

The hire is the latest recruiting coup for Meta, which has wound down its hiring spree from its headiest days, as it shifts focus to organizing its new talent-dense AI teams and pursuing the invention of what it calls superintelligence.

The Thinking Machines spokeswoman said Tulloch’s contributions “have been foundational” in getting the company to where it is today. “We’re grateful for what he helped build here and are committed to finishing what we started together,” she said.

The Wall Street Journal previously reported that Tulloch was offered a pay package from Meta that could have been worth as much as $1.5 billion with top bonuses and extraordinary stock performance but declined it. A Meta spokesman previously called the description of the offer “inaccurate and ridiculous” and said that the size of any compensation package is predicated on a stock rising. The terms of the offer he accepted couldn’t be learned.

Tulloch didn’t respond to a request for comment.

Tulloch was one of more than a dozen Thinking Machines employees approached by Meta Chief Executive Mark Zuckerberg over the summer. It is unclear which team he will be on at Meta.

Murati launched Thinking Machines in February, bringing more than 20 of her former OpenAI colleagues along with her. The company has raised $2 billion and launched its first product, Tinker, an API for fine-tuning large language models, earlier this month.

Meta, like the other top tech firms, has enormous AI ambitions. The company plans to spend up to $72 billion on capital expenditures this year alone, largely to build out data centers to train its AI models. It released its latest AI product, an AI video generator with a dedicated tab for the feature in its Meta AI app, in recent weeks. OpenAI released a similar product soon after.

Zuckerberg has been the company’s recruiter-in-chief in recent months, reaching out to AI researchers directly via email and WhatsApp messages and inviting them to his homes for meals and pitches. He went after top talent, offering pay packages worth $100 million or more in some cases.

Meta ultimately hired more than 50 AI researchers, engineers and other employees from the likes of OpenAI, Google DeepMind, Apple, Anthropic and xAI, and restructured its AI teams into the new Superintelligence Labs division. Meta also struck a deal with data-labeling startup Scale AI for a 49% stake in the company and hired its CEO, Alexandr Wang, to run the new division.

Meta now has four teams under its Superintelligence Labs division, including TBD Lab, a group that sits near Zuckerberg’s desk and is working on the next iterations of the company’s large language model, called Llama.

Chinese stocks race ahead as reforms take hold

MSCI China has surged 39 per cent this year even as many global fund managers branded the country ‘uninvestable’

Chinese stocks are outpacing global peers by the widest margin in eight years, in a sign that policymakers’ efforts to revive the market are bearing fruit even as many foreign investors hesitate to return.

The MSCI China index has surged 35 per cent this year, compared with a 14 per cent gain in the MSCI World index of developed market stocks, the largest margin of outperformance since 2017. 

This year’s rally comes after many global fund managers last year branded China — whose stock market had been in near-constant decline since peaking in early 2021 — “uninvestable”, following a government crackdown on the private sector and a long-running real estate crisis.

However, Beijing has been pushing to improve corporate governance at state-owned enterprises and private companies, and has launched huge monetary and fiscal stimulus, including measures for financing share buybacks.

Investors say these measures — together with a drive to increase the insurance sector’s equity purchases and concerted buying by the so-called national team of state institutions — are starting to turn the stock market into a viable alternative to property. 

“Part of the reason money went into real estate was the stock market was viewed a little bit like Macau,” said Brendan Ahern, chief investment officer at KraneShares, an exchange traded fund provider with products investing in China. He was referring to the tendency for locals to view the market as a casino rather than a place to allocate long-term savings.

“If you can make the stock market an appealing source of returns, it would arguably divert money from going back into real estate. That makes sense for the government,” he added.

Mark Headley, chair of Matthews Asia, an investment manager, said the government viewed the reforms as necessary to help its capital markets compete with the US.

“The Chinese government and the Chinese people have finally recognised that just owning a fifth apartment somewhere is not the perfect savings plan,” he said.

China’s stock market is small relative to its economy. The country accounted for 16.8 per cent of global GDP in 2024 but just 10.3 per cent of global stock market capitalisation, according to the World Bank. China accounts for only 3.35 per cent of MSCI’s all-country world index.

However, the number and quality of Chinese stocks have improved significantly over time, said Archie Hart, a portfolio manager at Ninety One in London. Of the more than 5,000 companies listed in mainland China, 2,504 have a market capitalisation of more than $1bn, according to data provider Wind.

“I look at it on a very long-term perspective. Thirty years ago your choices were state-owned,” Hart said. “Today you’ve got a fantastic choice of ecommerce companies, tech, manufacturing companies, consumer brands.”

Regulators have stepped up their efforts to improve stock market returns and corporate governance at China’s state-owned companies. Measures include tying managers’ key performance indicators to share price performance and return on equity.

When a stock market rout at the start of last year worsened, Beijing brought in Wu Qing, nicknamed the “broker butcher”, as head of the country’s securities regulator in a move to ease volatility and stabilise the market.

In a speech this year, he referred to foreign investors as “important participants in China’s capital market” and said he would accelerate measures to open up capital markets to the outside world.

In September last year, the China Securities Regulatory Commission encouraged listed companies “to lawfully and compliantly use M&A, equity incentives, cash dividends, investor relations management, information disclosure and share repurchases to elevate their investment value”.

“There’s a big effort by the regulators in these agencies to make the mainland Chinese companies credible companies for international investors,” said Amar Gill, secretary-general of the Asia Corporate Governance Association. 

But some in the industry see resistance within parts of government to market reforms that could diminish the state’s influence over corporate decision making.

“The tension, I would say, is between the agencies, the regulators and the party,” Gill said. “The party is still wanting to have control of state-owned enterprises and to some extent private companies as well, while the regulators are looking to see how they can make these companies focus on shareholder value.”

China’s outperformance this year comes as global investors seek to diversify their portfolios, which are often highly concentrated in the US.

However, US-China tensions and macroeconomic uncertainty are deterring many from reconsidering mainland stocks, even as Hong Kong proves attractive and other Asian markets such as South Korea and Japan are widely seen as less risky.

“To attract both domestic and foreign investors is going to take two to three years of steady returns,” said Headley.

Foreign flows to China’s mainland market have been muted this year, according to EPFR data tracking ETFs and mutual funds domiciled outside China. Mainland stocks received just $1.2bn of net foreign investment this year.

Some foreign investors remain unconvinced that China’s reforms have gone far enough, with many seeing recent initiatives as signs that Beijing wants to increase its control over companies and markets.

“There is still a huge sceptical slant” in western countries towards China, said the ACGA’s Gill.

Ryan Manuel, managing director of Bilby, which analyses government policy using artificial intelligence, said there was still tension between reforming China’s capital markets and the government’s fixation on controlling strategically vital sectors.

“Industrial policy muscles are stronger than capital markets reform muscles,” said Manuel. 

Nevertheless, for Chinese investors, the options are limited. “Where else are you going to put money in China with the real estate market being dead?” Manuel added.

Embraer predicts challenge to Boeing and Airbus duopoly

Brazilian planemaker says rising demand will allow new rivals to take market share from the US and European groups

Rising demand for commercial aircraft will create space for rivals to challenge the Airbus-Boeing duopoly, according to the chief executive of Brazilian planemaker Embraer.

Francisco Gomes Neto said he saw the potential for new competitors to produce narrow-body jets, which at present are only built by the European and US companies.

“When I look at the projections for the next 20 years, we see an opportunity for 40,000 aircraft in that segment,” he told the Financial Times at the company’s headquarters in São José dos Campos. “That’s a lot. I think there is room for more than two manufacturers, right? I mean, maybe three or four.”

Embraer is the world’s third-biggest planemaker and dominates the smaller regional jets that carry fewer than 150 passengers, although its output is far behind industry giants Airbus and Boeing. 

The $10.6bn group has been studying options for the next generation of its commercial and business jets but Gomes Neto said a decision was not due until the next decade at the earliest because it was focused on selling existing products. Embraer’s latest and largest model, the E195-E2, can carry up to 146 passengers.

Recent crises at Boeing and late deliveries of aircraft from both the US manufacturer and Airbus amid persistent supply chain problems have fuelled talk of whether Embraer might be tempted to enter the single-aisle market.

Gomes Neto said some of Embraer’s customers “say that they would like to have more options”. However, he cautioned that there was a “big gap” between saying something and buying something. 

Ron Epstein, a Bank of America analyst, believes there is a case for Embraer to develop a larger aircraft.

“The big question for them is strategically what do they do next?” he said. “Look out over the next 20 years at demand for commercial aircraft and I think almost for sure there’ll be room for a third player,” he added, noting that Boeing’s crises had reminded airlines that “having another player in the market is good for everybody”.

Embraer, Epstein said, was one of the few companies that could “bring a new product to market relatively cost-effectively”.

Gomes Neto’s comments echo those of executives at Boeing and Airbus, who have said no decisions on whether to launch a new single-aisle jet are imminent. Both are focused on delivering on orders for their existing narrow-body models — Airbus’s best-selling A320 family of jets this week overtook Boeing’s 737 as the most popular commercial aircraft in history by deliveries, according to industry data.

Industry executives believe China’s Comac is the most likely to disrupt the dominance of Boeing and Airbus. The state-owned company launched its first domestically made airliner, the C919, in 2023 and its customers include the country’s three biggest carriers as well as a few overseas airlines.

Going head-to-head with Airbus and Boeing would be a risky endeavour for Embraer. A past attempt by Bombardier to break into narrow bodies almost proved ruinous, leading the Canadian manufacturer to withdraw from commercial aircraft production and focus on business jets. 

Gomes Neto said Embraer would not want to put the company’s “financial health” at risk. Embraer plans to almost double revenues from its existing regional and business jets, with a target of reaching $10bn by the end of this decade. 

The company is enjoying strong demand for its regional jets despite being subject to the Trump administration’s baseline 10 per cent import tax in its biggest market. It successfully lobbied Washington for an exemption from the additional 40 per cent tariff imposed on Brazil two months ago, with Gomes Neto meeting the US treasury, commerce and transportation secretaries to press its case. 

Even so, Gomes Neto said the 10 per cent duty would add about $80mn in costs to the group, chiefly resulting from the import of parts for its private jets that are assembled in Florida. He expressed optimism that the remaining tariff would be removed from Brazilian aerospace goods. Adjusted half-year earnings before interest and tax were $253.8mn.

Embraer has not been immune from the industry’s supply chain challenges. Gomes Neto said deliveries of components such as engines and fuselage parts were still delayed but that the situation was improving, and the company was still on track to reach 100 commercial aircraft deliveries per year by 2028.

He added that the group was pursuing several international sales opportunities for its regional jets, including in India. 

The company is also seeking to boost overseas sales of its military products, including the KC-390 Millennium tanker-transport aircraft, and hopes to benefit from higher military spending from Nato countries. Eight European countries have so far ordered the KC-390. 

Embraer is working on plans to assemble the KC-390 in the US as part of a bid to win a contract with the US Air Force for the Next Generation Air Refuelling System programme. 

Separately, Gomes Neto said he expected the company’s electric air taxi, Eve, to enter commercial service by the end of 2027. The subsidiary, which is seen as a key potential growth area for Embraer, is among several companies developing battery-powered aircraft that can land and take off vertically to take passengers on short-range trips.

Bank deregulation set to unlock $2.6tn of Wall Street lending capacity

US lenders expected to cement global dominance by a significant easing of post-financial crisis rules

US banks are set for an unprecedented easing of capital rules, which new research suggests could unlock $2.6tn in lending capacity and increase pressure on regulators elsewhere to follow suit.

The upcoming dilution of US banking regulation, much of it already signalled by Washington, is likely to free up almost $140bn in capital for Wall Street lenders, according to research by consultancy Alvarez & Marsal.

Since Donald Trump returned to the White House, US authorities have embraced a much more bank-friendly approach, committing to loosen many of the rules that forced banks to increase their loss-absorbing capital buffers after the 2008 financial crisis.

The reduction of capital requirements is set to reinforce the dominant position of big Wall Street groups, boost their capacity to finance huge investments in AI and data centres and allow them to return more capital to shareholders.

“We think the Trump administration is kicking off a major wave of deregulation, unlocking a huge amount of capacity, which will give a massive economic boost and an earnings uplift,” said Fernando de la Mora, co-head of financial services at Alvarez & Marsal.

The New York-based consultancy predicted US banks would benefit from a 14 per cent reduction in their requirements for common equity tier one, a capital buffer that gives them capacity to absorb losses.

It forecast this would result in a 35 per cent boost to their earnings per share and a 6 per cent increase in their return on average tangible common equity — a benchmark used by investors.

The report, due to be published on Monday, provides detailed estimates of the impact of changes to banking regulation across the world. It forecast UK regulators would follow the lead of the US and reduce British banks’ capital requirements by about 8 per cent. 

However, it expects EU bank capital requirements to keep rising, predicting a 1 per cent increase, while capital levels for Swiss banks are forecast to rise by up to 33 per cent. The Swiss government has proposed higher capital levels that could require UBS to raise up to $26bn, as authorities seek to strengthen financial stability following the bank’s rescue of crisis-hit rival Credit Suisse.

“This is going to drive a further market share gain by US banks and the UK will just about hold its market share, while the Swiss and the EU banks will lose more ground,” said de la Mora.

JPMorgan Chase, the largest US bank, is set to be one of the main beneficiaries. The easing of restrictions is forecast to release $39bn of its capital, lifting its earnings per share by 31 per cent and its return on equity by 7 per cent.

Michelle Bowman, a longtime critic of stricter bank capital rules, was appointed this year as vice-chair of supervision at the US Federal Reserve and has since committed to ease restrictions that she has blamed for pushing lending into private credit markets.

US regulators have already presented proposals to water down requirements for banks to maintain a preset amount of high-quality capital in proportion to their overall assets. 

They have also announced plans to reform the extra capital buffers required of the biggest US banks and to rework the annual stress tests that impose more restrictions on them.

“There is a capital investment boom in the US to be financed — for AI, data centres, energy infrastructure and some reshoring,” said Huw van Steenis, vice-chair of consultancy Oliver Wyman. “This recalibration of regulation will help banks lean into this financing wave.”

However, European regulators worry about the risks of looser bank capital requirements. Christine Lagarde, the European Central Bank president, this month cautioned against “regulatory rollback”, while Bank of England governor Andrew Bailey warned about “the baby being thrown out with the bathwater” when reforming financial regulation.

Elon Musk’s xAI joins race to build ‘world models’ to power video games

Artificial intelligence group hired staff from Nvidia to work on advanced AI that can design and navigate physical spaces

Elon Musk’s xAI is pushing to build so-called world models, joining rivals such as Meta and Google in the race to develop artificial intelligence systems that can navigate and design physical environments.

The San Francisco-based start-up hired specialists from Nvidia over the summer to work on these next-generation AI models, which train on videos and data from robots to understand the real world.

World models could push the capabilities of AI beyond that of the large language models, trained on text, that underpin popular AI tools such as ChatGPT and xAI’s Grok.

Two people familiar with the plans said the company was building world models with a view to applying them in gaming, where they could be used to generate interactive 3D environments. One of the people added that they could be applied to AI systems for robots.

xAI has hired Zeeshan Patel and Ethan He, two AI researchers from Nvidia with experience in world models. Nvidia has been a leader in developing this technology with its Omniverse platform, which creates and runs simulations.

Some tech groups have vast expectations of world models, which could unlock uses for AI beyond software and computers in physical products such as humanoid robots. Last month, Nvidia told the Financial Times that the potential market for world models could be almost the size of the present global economy. 

xAI would release a “great AI-generated game before the end of next year”, Musk said in a post on X, confirming a target the billionaire set last year.

On Tuesday, xAI launched its latest image and video generation model, which it said had “massive upgrades” and is free to use.

Current video generation models, such as OpenAI’s Sora, generate frames of images for videos by predicting patterns learned from training data.

World models would be a big advance as they would have a causal understanding of physics and how objects interact in different environments in real time.

The company is advertising for technical staff in both image and video generation to join its “omni team”, which “creates magical AI experiences beyond text, enabling understanding and generation of content across various modalities, including image, video and audio”.

Salaries for these jobs range from $180,000 to $440,000. It also has an open position for a “video games tutor”, who will train Grok to produce video games and enable “users to explore AI-assisted game design”, for $45 to $100 an hour.

Musk follows other leading AI labs, such as Google and Meta, that are also working on these systems.

However, world models remain a huge technical challenge. Finding sufficient data to simulate the real world and to train such models has proved difficult and costly.

Michael Douse, head of publishing at Larian Studios, which develops the video game Baldur’s Gate 3, said on X this week that AI could not solve the “big problem” for the games industry, which is “leadership [and] vision”.

He added that the industry did not need “more mathematically produced, psychologically trained gameplay loops [but] rather more expressions of worlds that folks are engaged with, or want to engage with”.

xAI, Patel and He did not respond to requests for comment.

Trump administration challenges Chinese dominance of supply chain for metals essential to defence industry

The Pentagon has sought to procure up to $1bn worth of critical minerals as part of a global stockpiling spree to counter Chinese dominance of the metals that are essential to defence manufacturers.

The Trump administration’s accelerated effort to bolster the national stockpile is outlined in public filings published in recent months by the Pentagon’s Defense Logistics Agency. It follows export restrictions imposed on many of the materials by China, which dominates the supply chains for critical minerals and permanent magnets needed for technologies from smartphones to fighter jets.

“They [the US defence department] are incredibly focused on the stockpile,” said one former defence official. “They’re definitely looking for more, and they’re doing it in a deliberate and expansive way, and looking for new sources of different ores needed for defence products.”

Another former defence official said the $1bn is an acceleration over previous stockpiling efforts.

This week Beijing unveiled sweeping new export controls on rare earths and related technologies, prompting Donald Trump to say on Friday that he would no longer meet Chinese leader Xi Jinping later this month as planned.

The US would impose an additional 100 per cent tariff on Chinese imports in response, Trump said, adding: “There is no way that China should be allowed to hold the world ‘captive’ but that seems to have been their plan.” 

Beijing’s restrictions have fuelled fears in the US and Europe about their continued access to the metals.

Critical minerals are a national security priority for the Pentagon because they are crucial to virtually every weapons system, as well as technologies such as radar and missile detection systems. The defence department’s recent stockpiling activity is a marked acceleration driven by the Trump administration’s renewed enthusiasm for critical minerals. Some of the metals the Pentagon is seeking to acquire were not previously being stockpiled.

“China’s ability to turn off the supply of these critical minerals would have a direct, palpable and adverse effect on US ability to field the kind of high-tech capabilities that we’re going to need for any kind of strategic competition or conflict,” said Stephanie Barna, a lawyer at Covington & Burling in Washington.

Recent expressions of interest from the DLA include plans to buy up to $500mn of cobalt, up to $245mn of antimony from the domestic US Antimony Corporation, up to $100mn of tantalum from an undisclosed US company and up to a combined $45mn of scandium from Rio Tinto and APL Engineered Materials, a chemical manufacturing company based in Illinois that has offices in Japan and China.

The plans show that the US government was “conscious of how critical this stuff is, and wants to support whatever domestic capacity they have,” said one sector executive. “It’s very early days for western governments to stockpile critical minerals but they’re increasingly focused on it.”

The DLA stockpiles dozens of alloys, metals, rare earths, ores and precious metals, which are stored in depots throughout the country. Its assets were valued at $1.3bn as of 2023. The materials can only be released by the president in times of declared war, or if deemed necessary for national defence by the under-secretary of defence for acquisition and sustainment.

The price of germanium has soared this year as exports from China have fallen, with western traders warning of “panic” in the market as companies struggled to get hold of it. The germanium issue is one the Pentagon is trying to fix.

The price of antimony trioxide has almost doubled over the past 12 months, while carmakers have struggled to secure rare earth materials this year after China restricted certain exports.

Trump’s One Big Beautiful Bill Act contains $7.5bn for critical minerals, including $2bn to bolster the national defence stockpile which the Pentagon intends to spend by late 2026 or early 2027.

The OBBA also includes $5bn for defence department investments in critical minerals supply chains and $500mn for a Pentagon credit programme to spur investments.

One former defence official said several offices involved in securing the critical mineral supply chains were now “flush with cash” following the passage of the OBBA. 

The DLA declined to comment.

Analysts at Jefferies said the Rio deal, for around 6 tonnes of scandium oxide, was at a price that was “higher than market expectations”. Global consumption of scandium oxide is around 30-40 tonnes, according to price reporting agency Fastmarkets, with China the leading producer. 

The DLA stated in its filings that Chinese export controls on scandium had “constrained the supply chain”. 

The deal with USAC for antimony, meanwhile, would grow a stockpile “sufficient for industrial base mobilisation in a national emergency” and enable the company to continue producing in what was a “volatile” sector, it said.

USAC sources the mined material that it turns into metal from Canada, Mexico, Australia, Chad, Bolivia and Peru, chief executive Gary Evans told the FT. The company reported revenues of $15mn in 2024 and does not report its annual antimony metal production. The DLA deal for around 3,000 tonnes of antimony metal compares to total US antimony consumption in 2024 of 24,000 tonnes, according to the US Geological Survey.

“Market participants have been taken aback by the volumes requested by the DLA across several metals. Many consider the quantities to be unrealistic, especially within the proposed five-year timeframe,” said Cristina Belda, from Argus Media. “In most cases, the requested tonnages exceed the US’s annual production and import levels.”

The DLA has also sought information for the potential acquisition of rare earths, tungsten, bismuth and indium to add to the stockpile. 

The volumes of bismuth and indium were “significant” given the global size of the markets, said Solomon Cefai from Fastmarkets. “It is hard to imagine a situation where non-China supply would not be pressured by the volumes the DLA is looking at,” he said.

The DLA is seeking information for the potential acquisition of 222 tonnes of indium ingots, which compares to US consumption of refined indium of around 250 tonnes in 2024, according to the USGS.