Good morning from Davos, Switzerland, on the last day of the World Economic Forum. Two of the most talked about topics in the past 24 hours have been: First, during a question and answer session that included Bank of America's Brian Moynihan, President Trump claimed to Moynihan's face that Bank of America had canceled the bank accounts of conservatives. , the audience was shocked. Banks are now scrambling to repair the damage.
Second, the tech community here can't stop talking about an AI model from Chinese startup DeepSeek that is said to be just as powerful as ChatGPT, but consumes far less computing power. (Both of these are explained in more detail below.)
And on a more personal note, something very unusual happened yesterday. A meme coin called “Sorkin Coin” has emerged after BlackRock's Larry Fink joked on CNBC. It appears that some viewers created it, and since then, the trading volume of this token has exceeded $160 million. Please note that I am not affiliated with Coin in any way whatsoever. — Andrew
“Brian was hit.”
For at least a few minutes, the air seemed to be sucked out of the auditorium at the World Economic Forum in Davos, Switzerland, on Thursday.
President Trump just dodged a softball question from Bank of America's Brian Moynihan and instead went after him, saying that financial giants have become a hot topic among conservatives on a daily basis. He accused many of his supporters of suspending their bank accounts.
“Brian was hit.” One prominent executive described a frosty exchange with Dealbook's Lauren Hirsch: Rebroadcasts of the president's reprimands continued late into the night, especially during drinking sessions.
The bullish mood that had been hanging over Davos all week showed no signs of abating. Here, executives praised President Trump's low-tax, low-regulation policies. But it was another reminder that President Trump has discarded old rules of engagement between the U.S. government and executives, as if business leaders needed it.
His rough-and-tumble approach can lead to more deals and more profits. However, there are some unexpected pitfalls.
summary: Mr. Moynihan appeared on stage with Blackstone's Steve Schwartzman and others and asked Mr. Trump (via live video feed) questions as he returned to Davos. The Bank of America president asked how the president would maintain economic growth.
But Mr. Trump turned the tables not only on Mr. Moynihan but also on his colleagues, including Jamie Dimon of JPMorgan Chase & Co. He said, “I want conservatives to start opening up their banks, because a lot of conservatives are frustrated that banks don't allow them to operate inside their banks.・It also included a place called America.”
Republican officials have long accused banks of selectively closing accounts of conservative customers. or refuse to do business with them. (Executives at crypto trading companies have also complained that their bank accounts have been blocked.) The problem is even more complex. Bank of America spokesman Bill Holdin told the Times that the lender had never closed accounts for political reasons, but “had to submit to extensive oversight.” Ta. Government rules and regulations may also result in a decision to terminate a relationship with a customer. ”
Moynihan did not approve of Trump's remarks. (Some wondered if he hadn't even heard Mr. Trump's words, or if he had been silent.) Instead, he moved to safer territory, which Mr. Trump had mentioned earlier Returned to the 2026 World Cup, sponsored by Of America.
The aftermath continues. “Bank of America” and “debanking” were trending on Elon Musk’s X platform. Marc Andreessen, a venture capitalist who has accused banks of randomly firing executives at virtual currency trading companies, said that in X, “the bank accounts of the president's own wife and son were taken away.” posted a screenshot of a passage from Melania Trump's book.
On Thursday, the crypto industry scored a victory on this front, as President Trump's new executive order promised “fair and open access to banking services.”
Bank executives may have come to Davos feeling upbeat about the prospect of less regulation and more trading. This problem has not completely gone away, but there is now at least one major new problem that must be addressed.
what's happening here
Pete Hegseth faces a tough confirmation vote. The Senate is scheduled to vote on President Trump's pick for secretary of defense on Friday after Republicans defeated the Democratic filibuster and moved his nomination to the floor by a vote of 51-49. Only two Republican senators, Susan Collins of Maine and Lisa Murkowski of Alaska, voted against advancing Hegseth's nomination. Democrats are still trying to use their condemnation of his actions to persuade other lawmakers to join them in a final vote.
A federal judge has temporarily blocked President Trump's birthright citizenship executive order. Judge John Coughner said the president's efforts to eliminate automatic citizenship for infants born on U.S. soil are “patently unconstitutional.” It was the first legal setback to President Trump's broader efforts to crack down on immigration. Hours later, the president told reporters: “Obviously, I'm going to appeal.''
OpenAI makes artificial intelligence agent publicly available. The creators of ChatGPT have announced Operator, a service that can connect to the internet and autonomously perform tasks like grocery shopping and restaurant reservations. Although OpenAI acknowledges that Operator is still in the experimental stage, it is the latest effort by a technology company to prove that AI software can enable meaningful real-world applications.
Trump moves markets in his trademark way
President Trump loves the stock market going up. He may take credit for Thursday's record rally after taking aim at OPEC, interest rates and Fed independence.
Benchmark indexes soared on Thursday, shortly after he addressed world business leaders at the World Economic Forum in Davos, Switzerland, promising a “golden age” of peace and prosperity.
What encourages investors:
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President Trump called on OPEC to lower oil prices for the sake of consumers and international peace. “If prices fall, the Russia-Ukraine war will end immediately,” he said. Immediately after his remarks, global oil prices fell.
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He also called on central bank authorities around the world to lower interest rates. Some market observers said the move would lead to a weaker dollar, boosting exports and narrowing America's huge trade deficit, a source of frustration for President Trump. That said, the Bank of Japan raised interest rates on Friday. Still, the dollar fell against the yen.
After the presentation, President Trump made more dovish comments about the levy. In an interview with Fox News, the president appeared to backtrack on his earlier warning that huge tariffs would be imposed on China. “I would rather not have to use it,” he said of such threats.
Asian stocks rose on Friday.
There was one point that could still destabilize the market. That's another shot at Jay Powell. President Trump once again expressed dissatisfaction with high interest rates in the United States, a sign that he intends to keep pressure on the Fed chair, even though he does not have the authority to intervene in central bank policy or fire the chair. is.
“If I disagree, I'll let you know,” Trump told reporters, potentially setting up a new showdown ahead of next week's Fed meeting. Economists widely expect the central bank to keep interest rates on hold for several more months as inflation concerns grow.
Altman's Stargate Power Move
Sam Altman made headlines this week when he joined President Trump and fellow tech moguls Larry Ellison of Oracle and Masa Sohn of SoftBank to unveil a hugely expensive data center initiative.
The project, known as Stargate, has dragged the head of OpenAI into a new feud with AI nemesis Elon Musk and caused friction with key ally Microsoft. But new details suggest that Mr. Altman could stand to make a big profit if the project goes ahead — a big assumption.
Altman may have beaten his rival. Some tech watchers initially doubted Stargate would be open to other tech companies, but reports from The Information and the Financial Times say Stargate is backing ChatGPT. It appears that the service will only be provided to companies that do so.
Additionally, this is a project with significant backers. Oracle plans to build a data center in Abilene, Texas, exclusively for Stargate. The data center is initially expected to provide 1.2 gigawatts, or enough power to power Austin, the information said. And Ellison and his son have Trump ears.
Now, so does Altman. As part of the Stargate salvo, Mr. Musk cited an old social media post from the head of OpenAI criticizing Mr. Trump. But the president now seems satisfied with Mr. Altman, saying, “The people who are on board are very, very smart people.”
After the election, OpenAI employees weighed in on what Trump's victory and increased collaboration with Musk would mean for their company, especially given Altman's donations to Democrats, The Information reported. It is said that he asked whether For now, that concern appears to have been resolved.
Separately, Mr. Musk risks causing a rift with Mr. Trump. Politico reported that some administration officials and allies are frustrated by the tech giant's attack on Stargate. Trump said he wasn't concerned about Musk's criticism and shrugged: “He hates one of the people who is part of the deal.”
But White House observers have long wondered what separates the two men, who are known for demanding the limelight and harboring grudges. Is it possible that Mr. Musk is eroding his standing with Mr. Trump just as his rival is gaining ground?
China's dark horse candidate aiming for AI dominance
One of the Trump administration's signature AI initiatives is already weighed down by questions about its future, but one small Chinese startup is quickly becoming the talk of the town from Silicon Valley to Davos, Switzerland. .
DeepSeek's AI chatbot can go toe-to-toe with OpenAI's ChatGPT and Google's Gemini for a fraction of the expensive semiconductor resources needed by its U.S. rivals. The results have technology leaders and policymakers wondering whether U.S. efforts to deny access to China's high-end AI resources are ineffective, or whether DeepSeek has found a way around them. are.
What DeepSeek says: Limits on shipments of advanced chips in the U.S. are forcing the company's engineers to do more with less. The company says it used about 2,000 Nvidia chips. The tech giant uses 16,000 devices.
Some people are skeptical. Chinese companies are stockpiling thousands of Nvidia chips as the Biden administration tightens export controls. (DeepSeek's owner, High Flyer, is a volume trading shop that spent millions collecting processors through 2021.) Other companies are buying them from smugglers.
Alexander Wang of AI training giant Scale AI (who called Deep Seek's latest AI model “mind-blowing”) told Andrew at the World Economic Forum that Chinese companies have high-end chips that exceed US regulations. he said. He said DeepSeek probably has about 50,000 Nvidia Advanced H100 processors, but “obviously I can't speak to that.”
DeepSeek poses a new challenge to assumptions about the state of AI. The company has also open sourced its software. This means anyone in the world can access the underlying code and build products on top of it.
Many in the US argue that allowing free access to open source AI software is dangerous, but the risk is that Chinese open source products will eventually become the world's default. Some people claim that.
speed reading
Great deals
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In banking, Monte dei Paschi made an all-stock bid of $13.9 billion for fellow Italian lender Mediobanca. And Commerzbank's new CEO is refusing to meet with the CEO of Italy's UniCredit about a possible merger. (WSJ, FT)
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“Goldman defeats lawsuit from Hollywood executives over $7 billion deal” (Bloomberg)
politics, policy, regulation
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Bill McGinley, a partner at law firm Holtzman Vogel who was named the top lawyer for Elon Musk's government spending plan in December, is resigning from the committee. (WSJ)
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The Sackler family, which owns opioid maker Purdue Pharma, provided more money to settle the OxyContin lawsuit, but also made new demands. (New York Times)
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