For the week 1/12-1/16

[Posted 4:30 PM ET, Friday]

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Edition 1,395

I never thought I’d have to write this, but the situation in Greenland is getting serious.  Americans should be more than a bit concerned about how President Trump will respond to European troops arriving on the island Thursday, including personnel from France, Germany, the UK, the Netherlands, Finland, Norway and Sweden.  The total number is not known.  Denmark already had some troops there and added to its force earlier in the week.

The ball is now in President Trump’s court, and today, Trump threatened to impose tariffs on countries that oppose his efforts to take control of Greenland.

“I may put a tariff on countries if they don’t go along with Greenland because we need Greenland for national security.  So I may do that,” the president said at an event at the White House this morning.

Trump said the threat of tariffs against countries such as France and Germany had helped him address high prices for prescription drugs.  Trump said he could take the same approach to help him gain control of the island.

This is insane.  As every American third grader knows by now, the United States can basically do whatever it wants in consultation with Denmark and Greenland, which would welcome an increased U.S. presence, both militarily and economically.  But Trump is clearly itching to invade the place and claim it.  He can’t possibly do that with NATO troops on the island, right?  Except it’s Trump.

A new CNN poll finds just 25% of American favor the U.S. attempting to take control of Greenland, 75% disapprove.  Even the president’s partisans are evenly divided, with 50% of Republicans and Republican-leaning independents saying they support it and 50% opposed.

—

Wall Street and the Economy

Sunday, Federal Reserve Chair Jerome Powell said the Department of Justice has served the central bank with subpoenas and threatened it with a criminal indictment over his testimony this summer about the Fed’s building renovations.

The move represents an unprecedented escalation in President Trump’s battle with the Fed, which he has repeatedly attacked for not cutting its benchmark interest rate as quickly as Trump prefers.  The subpoena relates to his testimony before the Senate Banking Committee in June, Powell said, regarding the Fed’s $2.5 billion renovation of two office buildings, a project that Trump criticized as excessive.

Powell on Sunday cast off what up to this point has been a restrained approach to Trump’s criticisms and personal insults, which he has mostly ignored.  Instead, Powell issued a video statement in which he bluntly characterized the threat of criminal charges as simple “pretexts” to undermine the Fed’s independence when it comes to setting interest rates.

“On Friday, the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June,” Powell said.  “I have deep respect for the rule of law and for accountability in our democracy. No one – certainly not the chair of the Federal Reserve – is above the law.”

“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions – or whether instead monetary policy will be directed by political pressure or intimidation,” he added.

It was a sharp departure from the Fed’s understated response to Trump this year.  The central bank has attempted to placate the administration by dialing back some policies, such as efforts to consider the impact of climate change on the banking system, that the administration clearly opposed.

In a brief interview with NBC News Sunday, Trump insisted he didn’t know about the investigation into Powell.  When asked if the inquiry is intended to pressure Powell on rates, Trump said, “No.  I wouldn’t even think of doing it that way.”

Reminder…Powell’s term as chair ends in May, and there are growing signs Trump is announcing his replacement in the next few weeks.

Trump has also sought to fire Fed governor Lisa Cook, an unprecedented step, though she has sued to keep her job and courts have ruled she can remain in her seat while the case plays out. The Supreme Court will hear arguments in that case Jan. 21.

At the Senate Banking Committee hearing in June, Chairman Tim Scott (R-S.C.) said the Fed’s building renovation included “rooftop terraces, custom elevators that open into VIP dining rooms, white marble finishes, and even a private art collection.”

Powell disputed those details in his testimony, saying “there’s no new marble…there are no special elevators” and added that some items are “not in the current plan.” In July, Russell Vought, director of the Office of Management and Budget, said in a letter to Powell that his testimony “raises serious questions about the project’s compliance” with previous plans approved by a planning commission.

Later that month, Trump visited the building site and, while standing next to Powell, overstated the cost of the renovation. Later that day, Trump, speaking to reporters, downplayed any concerns with the renovation.  He said, “they have to get it done” and added, “Look, there’s always Monday morning quarterbacks. I don’t want to be that.  I want to help them get it finished.”

When asked if it was a firing offense, Trump said, “I don’t want to put that in this category.”

The Justice Department in a statement Sunday said it can’t comment on any particular case, but added that Attorney General Pam Bondi “has instructed her U.S. Attorneys to prioritize investigating any abuse of taxpayer dollars.”

The investigation was launched by the U.S. attorney’s office in Washington, D.C., which is led by Jeanine Pirro, a close Trump ally.

The potential indictment has already drawn concern from Republican Senator Thom Tillis (N.C.), who sits on the Banking Committee, which oversees Fed nominations.

“If there were any remaining doubt whether the advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none,” Tillis said.  “It is now the independence and credibility of the Department of Justice that are in question.”

Tillis added: “I will oppose the confirmation of any nominee for the Fed – including the upcoming Fed Chair vacancy – until this legal matter is fully resolved.”

Senate Majority Leader John Thune (R-S.D.) said he hadn’t seen the allegations against Powell, but “they better be real and they better be serious.”  Thune said the issue “needs to be resolved quickly because the Fed’s role and the Fed’s independence in shaping monetary policy in the country is something we need to ensure proceeds without political interference.”

Sen. John Kennedy (R-La.), a member of the Senate Banking Committee, said he has known Powell a long time and “would be stunned to find out he had done anything wrong.”  He cautioned against what he called a “pissing match” between the Fed and the executive branch that he said could worry investors and push interest rates higher.

Trump has attacked Powell as a “numbskull,” a “dumb guy” and an “obvious Trump Hater.”  More recently, Trump threatened to sue Powell for “gross incompetence,” pointing to the Fed building renovation.

But if the president gets the Fed chair he wants in 2026, there is no guarantee he gets the monetary policy he wants.  Today’s economy is solid in many respects, which makes aggressive easing difficult unless the data demands it. Inflation remained above target, as we awaited fresh data this week.

The misconception is that a new Fed chair can reset policy direction on arrival.  In reality, the chair still needs to convince a majority to act as he sees fit, and the job is more about agenda-setting, coalition-building, and communication, not in overruling the policy committee.

A more hawkish-leaning voter roster, lingering inflation risks, and heightened sensitivity about its independence makes the case for rapid cutting difficult.

Editorial / Wall Street Journal

“In the annals of political lawfare there’s dumb, and then there’s the criminal subpoena federal prosecutors delivered Friday to Federal Reserve Chairman Jerome Powell.  President Trump would do himself and the country a big favor by firing those responsible for this fiasco….

“His saner advisers are worried that Wall Street will view this as an attack on the Fed’s institutional independence, which it is.  Markets reacted calmly on Monday, though the dollar fell and bond yields rose as a bet on more inflation.  Whatever you think about Mr. Powell or central-bank independence, the way to change the Fed’s legal status is through legislation, not a criminal prosecution of dubious merit.

“This ploy may backfire on Mr. Trump’s plans for the Fed.  Mr. Powell’s term as chairman ends in May, but his seat on the Board of Governors doesn’t expire until 2028….

“Mr. Powell isn’t required to leave the Fed when his chairmanship ends, and Mr. Powell may now feel he needs to stay to avoid the appearance that the white House can bully Fed officials.  That would deny Mr. Trump a second appointment to the Fed board.

“Mr. Trump also is alienating Senators who will judge his nominee for confirmation….

“Americans elected Mr. Trump to reduce inflation, and he and Republicans have 10 months until the elections to show progress. Picking a fight with the Fed – and the bond market – over an issue that voters will find confusing and irrelevant is lawfare for dummies.”

Separately, President Trump expressed indifference toward the North American trade agreement with Canada and Mexico, portending a lengthy renegotiation of the U.S.’s largest free-trade pact.

Trump on Tuesday said there’s “no real advantage” to the U.S.-Mexico-Canada Agreement, which he signed in 2020 and is subject to a review this year.  He said the deal primarily benefits Canada, but that Americans “don’t need their product” because “everybody’s moving here.”

Officials in Mexico City and Ottawa have grappled with the president’s erratic trade policy ever since his return to office a year ago.  They signal that the scheduled renegotiation of the USMCA could turn into an airing of grievances by Washington against the U.S.’s two largest trading partners.

July 1 is the deadline for the countries to agree to renew the agreement.  If the parties did agree, it would be extended for 16 years.  But if not, then the parties would be required to hold annual joint reviews until they agree to approve it again or the pact expires in 2036.

That is separate from the withdrawal provision, which states that any country can exit the agreement with six months’ written notice to the other parties.  It’s not yet clear whether Trump will do that.

So, on the economic data front, we had quite a bit this week, highlighted by Tuesday’s consumer price index report for December, up 2.7% annualized, and 2.6% ex-food and energy, both figures the same as November, which was viewed skeptically because of how the data was collected post-government shutdown.

The 2.6% figure on core was better than consensus.

The CPI was pulled down by the cost of used cars and trucks, which fell 1.1% over the month, but airline fares surged 5.2%, and the price of groceries came in hot, up 0.7% vs. November and 2.4% from a year ago.

Inflation has been pulled down over the past year by apartment rents, which rose 3.1% over the year, but this was much higher the prior year.

Energy prices overall have risen 2.3%, but that masks big differences between sources: the price of gasoline was down 3.4%, while electricity prices rose by 6.7%.

Overall, meat, poultry, and fish prices were up 6.9% in December compared with a year earlier, driven by a 16.4% increase in beef and veal costs, which were also up 1% on a monthly basis.

Coffee costs were up 19.8% in December from a year earlier.

But the price of eggs plummeted 20.9% from a year ago, and 8.2% just between November and December.

But with the December unemployment rate falling to 4.4%, the Fed’s Open Market Committee is expected to hold interest rates steady after cutting them three times since September when it gathers Jan. 27-28.

President Trump on Truth Social, following the CPI report:

“JUST OUT: GREAT (LOW!) Inflation numbers for the USA.  That means that Jerome ‘Too Late’ Powell should cut interest rates, MEANINGFULLY!!! If he doesn’t he will just continue to be, ‘TOO LATE!’ ALSO OUT, GREAT GROWTH NUMBERS.  Thank you MISTER TARIFF! President DJT”

Wednesday we then had producer prices for November and they were hot; on both headline and core, 3.0%, when 2.7% was expected.  Yup, you can kiss a rate cut goodbye, for at least the first FOMC meeting of 2026.

In other economic news, November retail sales rose a better than expected 0.6%. December industrial production was up 0.4%.

And we had some strong existing-home sales data for December, rising 5.1% over November to an annualized rate of 4.35 million, firmly above market expectations and the sharpest increase in nearly two years to the highest level in nearly three years.

The median price of existing home sales eased further to $405,400, a 0.4% increase from the previous year.

According to National Association of Realtors Chief Economist Lawrence Yun: “2025 was another tough year for homebuyers, marked by record-high home prices and historically low sales.  However, in the fourth quarter, conditions began improving, with lower mortgage rates and slower home price growth.  The gains were broad-based, with all four major regions improving from the prior month.”

Yun added: “There is pent-up demand.  When does it get released?  When the mortgage rate begins to move.”

Freddie Mac’s 30-year fixed-rate mortgage fell to 6.06% this week, the lowest in over 3 years.

The Atlanta Fed’s GDPNow barometer for fourth-quarter growth is 5.3%, with still quite a bit of Q4 data to be released given the government shutdown, but we’re catching up.

Next week we get the November readings on personal income and consumption, as well as the Fed’s preferred inflation barometer, the personal consumption expenditures index (PCE).

But one more item…the U.S. government posted a $145 billion budget deficit for December, up 67% or $58 billion from a year earlier due to record outlays that were inflated by calendar shifts in benefit payments and receipts, the Treasury Department said on Tuesday.

The report showed that revenue growth from President Trump’s tariffs may have plateaued, as December net customs receipts totaled $27.9 billion, down from the low $30 billion range in recent months but far above the $6.8 billion recorded in December 2024.

The deficit for the first three months of fiscal 2026, which started on October 1, 2025, totaled $602 billion, down $109 billion or 15%  from the same period a year earlier amid record receipts and outlays.

We are still waiting for the Supreme Court’s final ruling on tariffs.

Europe and Asia

–Just one economic item of note for the eurozone. November industrial production rose 0.7% over October, and 2.5% from a year earlier.

–I didn’t have a chance to get into one topic last Friday that came up…the European Union, overcoming deep dissension among its members, gave the green light to a sweeping trade pact with four South American countries that would create one of the largest free-trade zones in the world, connecting markets with more than 700 million people.  This came during a period when Trump was ousting Venezuela’s Maduro and capturing two more oil tankers (apparently five in total the past month or so…now six).

The EU’s agreement with Brazil, the largest economy in Latin America, Argentina, Paraguay and Uruguay was long opposed by agricultural interests and environmentalists in Europe.

Critics argued that South American producers did not meet European standards on pesticides, deforestation, animal treatment and worker rights.  Farmers, particularly chicken and beef producers, have been worried that cheap imports would undercut their livelihoods.

European carmakers and pharmaceutical manufacturers in Germany, Spain and elsewhere, though, have been eager to access Mercosur’s huge market.  Bolivia, which recently joined the bloc, will eventually become eligible to participate in the deal.

In the end, Italy proved to be the key vote in securing a majority for approval, overcoming opposition from France, Poland, Austria, Ireland and Hungary.

The European Parliament will have to approve the treaty.

The accord is set to cut tariffs on European products exported to South America and on South American goods shipped to Europe.  Proponents have argued that the agreement will also provide access to a source of critical raw materials aside from China.

Back across the pond…Canadian Prime Minister Mark Carney traveled to Beijing to mend trade relations and after meeting with Chinese President Xi, the two sides announced that Canada will lower tariffs on some Chinese electric vehicles and China will do the same for Canadian canola prices, a major shift in policy that was announced today.

Carney said Canada will allow up to 49,000 Chinese electric vehicles into the Canadian market under a preferential tariff rate of 6.1 percent.

In 2024, at the behest of the Biden administration, Canada imposed a 100 percent tariff on Chinese EVs.

China will lower tariffs on Canadian canola seed to a combined rate of approximately 15 percent, down from about 85 percent, offering fast relief to a major Canadian agricultural sector.

While the new tariff changes are modest, they signal an important break with the United States as Canada seeks to urgently diversity its trading partners and reduce its reliance on the U.S.

Carney said after his meeting with Xi: “President Xi and I are announcing that Canada and China are forging a new strategic partnership.”

—China reported strong exports for December, up 6.6% year-over-year to a record peak of $357.8 billion, surpassing expectations of 3% growth and accelerating from a 5.9% gain.

Exports were strong to the European Union (11.6%), Latin America (9.8%), Japan (5.3%), Taiwan (11.2%) and Australia (12.9%).  However, exports plunged to the U.S. 30% in December, and fell 20% for the full year 2025 due to the impact of newly imposed U.S. tariffs, even though the U.S. and China agreed to scale back some of their duties.

For the whole of 2025, China’s exports rose 5.5% from a year earlier to $3.77 trillion. [General Administration of Customs]

China had the world’s largest trade surplus ever, even adjusting for inflation, as a tsunami of exports flooded markets around the world, the surplus reaching $1.19 trillion, an increase of 20% from 2024.

Chinese factories increased sales to other regions, following Trump’s tariffs, and in many cases bypassed the tariffs by shipping goods to the United States through Southeast Asia and elsewhere.

China’s trade surplus has also been propelled by a weak currency, which makes the country’s goods less expensive in foreign markets and its imports more expensive.

Inflation in the West has made China’s exports even more appealing in foreign markets.  China also suffers from deflation, a broad drop in prices prompted by widespread factory overcapacity and weak domestic demand, the latter still impacted heavily by the housing market crash that erased the life savings of many Chinese who had invested in property, leaving them with little ability to buy the flood of goods pouring out of the country’s factories.

Japan’s December producer prices rose 0.1% over November, 2.4% vs. a year ago.

Separately, Japanese Prime Minister Sanae Takaichi’s reported plan for a snap election fueled a rally in stocks while pushing down bonds (yields up).

Success at the polls for Takaichi, who just took office in October, would provide a mandate for her to continue hawkish diplomacy and pro-stimulus policies.

She is expected to dissolve parliament next week.

Street Bytes

—Stocks, as measured by the three major indexes, suffered small losses this week…the Dow Jones down 0.3%, the S&P 500 falling 0.4% and Nasdaq 0.7%.

But the Russell 2000 small-cap index hit a new all-time high and is up 7.9% for the first few weeks.

—U.S. Treasury Yields

6-mo. 3.61%  2-yr. 3.59%  10-yr. 4.22%  30-yr. 4.84%

Today, at a public event, President Trump said he kind of preferred that National Economic Council Director Kevin Hassett remain in that position, thus juicing the odds the other Kevin, former Fed Governor Kevin Warsh, will be Trump’s choice to replace Jerome Powell.

After Trump’s musing, bonds sold off and the yield on the 2- and 10-year rose as Hassett was seen as the Dove between the two Kevins.

—Oil finished the week a bit higher due to the Iran tensions, $59.48.

But regarding Trump’s plan to drive oil prices to $50 a barrel, potential additional barrels from Venezuela could help.  And production from OPEC and others such as Brazil, Guyana and Canada has been strong and there were already expectations of an oil glut.

Before Nicolas Maduro’s capture, as I noted the other week, Goldman Sachs estimated that the U.S. benchmark crude price (WTI) would average $52 a barrel in 2026.  But now they are saying $50 if Venezuela increases production by 400,000 barrels a day.  Venezuela produces around 900,000 today.

As for the potential for Venezuela to increase production, last Friday as I was going to post this column, President Trump was meeting with major oil executives at the White House on the topic and Exxon Mobil CEO Darren Woods didn’t hold back, calling the nation “uninvestable.”

“If we look at the legal and commercial constructs and frameworks in place today in Venezuela, it’s uninvestable,” Wood said, adding his company’s assets had been seized by the government in Caracas twice before.

“How durable are the protections from a financial standpoint? What will the returns look like?  What are the commercial arrangements, the legal frameworks?” Woods asked.  “All those things have to be put in place in order to make a decision to understand what your return would be over the next several decades.”

Nonetheless, Woods said Exxon was ready “to put a team on the ground” if there is an invitation from the Venezuelan government and appropriate security guarantees.

Trump had said: “The plan is for them to spend – meaning our giant oil companies will be spending at least $100 billion of their money, not the government’s money.” The president said that the U.S. will ensure safety for the companies.  “They will have those guarantees.”

Trump expressed confidence after the meeting.

“We sort of formed a deal,” he told reporters.  “They’re going to be going in with hundreds of billions of dollars in drilling for oil, and it’s good for Venezuela and it’s great for the United States.”

Still, when asked about any specific commitments, Energy Secretary Chris Wright pointed to Chevron Corp. – the only U.S. major still in Venezuela – as the “one specific pledge” from an oil company to help revive the nation’s crude production.

Chevron Vice Chairman Mark Nelson said the company was poised to significantly ramp up its output in the country, which is currently about 240,000 barrels per day, and could increase production by roughly 50% over the next 18 to 24 months.

But Trump said companies that had their assets expropriated in Venezuela by former President Hugo Chavez also shouldn’t expect to get their money back.  ConocoPhillips said it is owed $12 billion from Venezuela, but Trump told Conoco CEO Ryan Lance that he should consider that money “a good write-off.”  Lance said Conoco has already written the investment off.

The president then told reporters aboard Air Force One Sunday evening that he’s leaning toward excluding Exxon Mobil from his push for U.S. oil majors to rebuild Venezuela’s petroleum industry, saying he was displeased with the company’s response to his initiative.

“I’d probably be inclined to keep Exxon out,” Trump said.  “I didn’t like their response.  They’re playing too cute.”

When asked Sunday which backstops or guarantees he had told oil companies he was willing to provide, Trump said: “Guarantees that they’re going to be safe, that there’s going to be no problem. And there won’t be.”

Trump didn’t specify in what way he might seek to exclude Exxon, but I’m guessing Darren Woods was smiling broadly.  ‘We don’t want to be in that stinking place anyway,’ he no doubt mused.

If Venezuela down the road becomes a true democracy, and Washington and Caracas have binding agreements on a legal framework and security for the oil companies, Exxon Mobil will get its share because they are the biggest.  Woods and Co. should, and will, just sit back and watch developments in the meantime.

As for Trump’s goal of oil at $50 a barrel, with lower oil prices combatting inflation….

“It’s the one product people see nearly every day at their street corner,” said Andy Lipow, president of Lipow Oil Associates in Houston.  “Rising and falling gasoline prices, for many people, hits them in their pocketbook right away.  Do you know what the last price was that you paid for spaghetti sauce? I bet you know what you paid for gasoline.”

Yes, Mr. Lipow.  But I also know what I paid for auto insurance, and what the price of Stouffer’s Frozen Pizza and Bubba Burgers cost, and they ain’t goin’ down.

–It was Big Bank week on the earnings front.

JPMorgan Chase kicked things off Tuesday, with fourth-quarter EPS capping off a record year, while reporting a hit to net income resulting from its deal to take over the Apple Card portfolio from Goldman Sachs, which it announced last week.

Net income came in at $13 billion, including the $2.2 billion in credit losses it planned for as a result of the deal.  Ex-these costs, JPM said its net income would have tallied $14.7bn in the quarter.

Adjusted earnings per share came in at $5.23, higher than the $4.85 that Wall Street was expecting.

In a statement, CEO Jamie Dimon said the U.S. economy has been “resilient,” adding that “consumers continue to spend, and businesses generally remain healthy.”

Dimon cautioned, however that “markets seem to underappreciate the potential hazards – including from complex geopolitical conditions, the risk of sticky inflation and elevated asset prices.”

JPMorgan’s net interest income, or revenue earned from checking and savings accounts, credit cards, and auto loans, rose 7% in the final quarter of 2025 to $25 billion.  Its core Wall Street revenues from equities, fixed income, currency, and commodity trading rose 15% from the fourth quarter of 2024, surpassing analyst expectations.

Meanwhile, dealmaking revenue fell 4% from the year-ago quarter, missing expectations due to lower fees in bond and equity underwriting.

For 2025, the nation’s largest bank had its second-best year ever.  Its full-year net income declined by 2% from the previous year to $57 billion, while its annual net revenue climbed to $182 billion, the bank’s highest ever.

2025 marked the 13th straight year JPM was No. 1 in worldwide investment banking revenue, according to Dealogic.

Separately, Jamie Dimon defended the Federal Reserve after it was subpoenaed by the Justice Department, saying that “anything that chips away” at the central bank’s independence “is not a good idea.”

Speaking with reporters on a call after reporting earnings, Dimon said political interference with the Fed would cause inflation and interest rates to go up, contrary to President Trump’s stated goal of getting rates to go lower.  Dimon’s remarks came after Fed Chair Jerome Powell disclosed this weekend that he was being investigated by the DOJ.

Dimon also said Tuesday that he didn’t think the Fed was infallible and had made mistakes.

“I want to say that I don’t agree with everything the Fed has done,” Dimon told reporters.  “I do have enormous respect for Jay Powell the man.”

—Bank of America beat estimates for fourth-quarter profit, as its traders capitalized on volatile markets, while it brought in record income from interest, sending its shares up about 2%.

The bank expects its first-quarter net interest income to rise 7%.  It also reiterated a 5% to 7% NII growth forecast for the fiscal year 2026.

Softening U.S. labor demand, political gridlock and concerns over a potential AI-driven stock bubble rattled the stock markets in the fourth quarter, prompting investors to reshuffle their portfolios, while speculation about the Federal Reserve’s rate cuts further boosted trading.

BofA’s sales and trading revenue rose 10% to $4.5 billion in the quarter, in line with CEO Brian Moynihan’s forecast last month.

“With consumers and businesses proving resilient, as well as the regulatory environment and tax and trade policies coming into sharper focus, we expect further economic growth in the year ahead,” Moynihan said in a statement. “While any number of risks continue, we are bullish on the U.S. economy in 2026.”

Bank of America reported net income of $7.6 billion, or 98 cents per share, in the three months ended Dec. 31, compared with $6.8 billion, or 83 cents per share, a year earlier.

BofA’s NII rose 9.7% to $15.75 billion in the quarter from a year ago.

—Wells Fargo missed analysts’ estimates for fourth-quarter profit and interest income, sending its shares lower.

The bank, which had twice reduced its annual interest income expectations last year, said NII rose 4% to $12.33 billion in the quarter from a year earlier, but missed expectations of $12.46 billion.

The fourth-largest U.S. lender’s net income was $5.36 billion, or $1.62 per share for Q4, compared with $5.08 billion, or $1.43 per share last year.  The Street was at $1.67 for EPS.

But the results capped a strong year as regulators removed a $1.95 trillion asset cap in June, lifting a penalty linked to WFC’s fake-accounts scandal, allowing the bank to grow and pushing total assets past the $2 trillion mark last year for the first time.

“We have funded significant increased investments in infrastructure and business growth by driving greater savings… Evidence of increased growth can be seen across the company,” CEO Charlie Scharf said in a statement.

Under Scharf, the bank has streamlined its workforce, leaning on cost cuts to fund long-term growth initiatives.

Scharf said last month that Wells Fargo will keep trimming headcount as it focuses on becoming more efficient, adding that artificial intelligence presents a major opportunity to boost productivity.

Headcount was down about 5,600 at yearend vs. Sept. 30.  The headcount has fallen every quarter since late 2020.

—Goldman Sachs’ shares surged after it reported net income of $4.6 billion, or $14.01 earnings per share, a 12% increase from the fourth quarter of last year.  The outcome far exceeded analysts’ expectations, which did not include Goldman’s deal to pass its Apple credit card portfolio to JPMorgan Chase.

The handoff led to a $2.12 billion net benefit, or $0.46 per share.

The Apple handoff also dented Goldman’s quarterly net revenue, which fell 3% to $13.5 billion from the fourth quarter of 2024.

Revenue from Goldman’s dealmaking fees jumped 25% to $2.57bn, in line with expectations.

“We continue to see high levels of client engagement across our franchise and expect momentum to accelerate in 2026, activating a flywheel of activity across our entire firm,” CEO David Solomon said in a statement.

“While there are meaningful opportunities to deploy capital across our franchise and to return capital to shareholders, our unwavering focus remains on maintaining a disciplined risk management framework and robust standards,” Solomon added.

2025 was a good year for Goldman, the bank notching its second-highest year for profits – $17.2 billion – a 27% increase from 2024 full-year net income.  GS also recorded its second highest full year in net revenue and dealmaking fees.

Goldman’s standout M&A advisory business soared 41% to $1.36 billion compared to Q4 of 2024, which was roughly in line with analysts’ expectations.  The bank notched its highest year ever in equity trading fees, which jumped 24% during the fourth quarter to $4.3 billion while total trading for the full year rose 16% from 2024.

—Citigroup shares rose (then fell on a tough day for bank stocks, Wednesday) after it reported fourth-quarter net income of $2.47 billion, with adjusted earnings per share of $1.81 on adjusted revenue of $21.0 billion; the Street at $1.67 and $20.72bn.

Net interest income rose 14% to $15.67 billion, better than consensus.

For the full year 2025, Citi delivered reported net income of $14.3 billion (adjusted $16.1bn), its strongest revenue growth in over a decade, and returned more than $17.5 billion to shareholders, including over $13 billion of share repurchases.

The bank used its earnings call to highlight a “strong quarter” and what CEO Jane Fraser described as a “very good year of progress,” emphasizing improving returns, broad-based revenue growth, continued transformation progress, and significant capital return to shareholders. Management also outlined key financial expectations for 2026, including mid-single-digit net interest income growth.

“With record revenues and positive operating leverage for each of our five businesses, 2025 was a year of significant progress as we demonstrated that the investments we are making are driving strong top-line growth,” Fraser said in the earnings release.

“We enter 2026 with visible momentum across the firm,” she added.

Fourth-quarter expenses were $13.8 billion, up 6%, driven by higher compensation and benefits, tax charges, legal expenses, and technology, partially offset by productivity savings and lower deposit insurance expenses.  Citi’s cost of credit was $2.2 billion, “primarily consisting of net credit losses in U.S. cards.”

—Morgan Stanley on Thursday reported fourth-quarter earnings of $4.4 billion, or $2.68 per share, surpassing the Street’s expectations of $2.41 per share.

The investment bank posted revenue of $29.99 billion, $17.89bn net of interest expense, both figures beating the Street.

Morgan Stanley’s investment banking revenue rose to $2.41 billion in the quarter from $1.64 billion a year earlier.

MS CEO Ted Pick said in a statement that “investment banking activity accelerated and global markets remained strong.”

Revenue from wealth management rose 13% to $8.43 billion in the quarter, buoyed by rising markets.

Total client assets across wealth and investment management reached $9.3 trillion in the quarter, inching closer to the bank’s long-standing target of managing $10 trillion in client assets.

—BlackRock Inc. pulled in $342 billion of total client cash in the fourth quarter, pushing the firm to a record $14 trillion of assets as it integrates a string of recent acquisitions to become a force in private markets.

Investors added $268 billion on a net basis to its long-term investment funds, including $181 billion to its exchange-traded fund business that now has $5.5 trillion overall, BlackRock said Thursday in a statement.

“Around the world, clients are looking to do more across BlackRock,” Chief Executive Officer Larry Fink said in a statement.  “Our pipeline of business has broadened across products and regions, spanning public and private markets mandates, technology and data, and client’s channels.”

BlackRock’s adjusted earnings per share in the quarter rose 10% from a year ago to $13.16.  That beat the average analyst estimate of $12.28.  Revenue rose 23% to $7 billion from the year-ago quarter.

The asset manager is in the midst of transforming itself from a dominant player in stocks, bonds and public markets, into one of the largest firms in private credit and infrastructure markets globally.  Fink plunked down about $28 billion to buy Global Infrastructure Partners, HPS Investment Partners, and Preqin Ltd., in one of its biggest deal sprees to become a force in private markets investing and data.

—President Trump called for credit-card interest rates to be capped at 10% for one year in his latest attempt to address voter concern about the stubbornly high cost of living.

“Please be informed that we will no longer let the American Public be ‘ripped off’ by Credit Card Companies that are charging Interest Rates of 20 to 30%, and even more,” the president posted on Friday on Truth Social, adding that he wants the cap to begin Jan. 20.

Trump proposed a 10% cap during the 2024 presidential campaign as a way to ease the burden on Americans who are carrying high levels of credit-card debt.  It is one of several affordability-focused proposals he has floated in recent days, including announcing a ban on institutional investors from buying single-family homes, and suggesting that the mortgage companies Fannie Mae and Freddie Mac could buy $200 billion in mortgage bonds to help lower borrowing costs.

Credit-card rates average around 23%, according to the Federal Reserve.

Shares in banks with credit card businesses slumped Monday and into Tuesday.

This is a truly awful idea.  As Bank of America CEO Brian Moynihan told CNBC’s Becky Quick this week, if credit card rates were capped at 10%, that would apply only to those with credit scores in the 700s.  Everyone else would be closed out.  As in that would kill the economy.

—Delta Air Lines posted upbeat fourth quarter results Tuesday morning, saying growth in the premium business, and lack of certain headwinds, would propel its business forward in 2026.

For the quarter, Delta posted record adjusted revenue of $14.61 billion against estimates for $14.67 billion, per Bloomberg consensus.  The results were up 1.2% compared to a year ago, which was outside of the airline’s own 2% guidance to the impact of the government shutdown.

Delta’s adjusted earnings per share came in at $1.55, versus the $1.53 expected. The company’s earnings took a $0.25 hit from the government shutdown as well.

Looking ahead, Delta is projecting revenue in Q1 to grow by 5% to 7%, with adjusted EPS of $0.50 to $0.90.  For the year, Delta sees adjusted EPS of $6.50 to $7.50, representing a whopping 20% year-over-year jump at the midpoint.

“There’s a lot of discussion everywhere you go on the K-shaped consumer, and our consumer happens to sit right at the top end of that K, and as a result of that they are investing and prioritizing spending on travel, and the higher-quality experience which affords itself to premium experiences is what they’re seeking,” Delta CEO Ed Bastian said on a call with reporters, adding that 100% of the seat growth in Delta’s cabins are in premium, with none in its main, or economy, cabin.

Bastian said 2026 was off to a “strong start,” with top-line growth accelerating on consumer and corporate demand.

Delta’s international business continues to be strong, with year-over-year growth in Q4 up 5%, driven by the Transatlantic and Pacific regions.  Delta said 90% of its corporate clients (who take a high amount of international trips) expect travel to increase or remain steady in 2026.

—TSA checkpoint numbers vs. 2025

1/15…133 percent of 2025
1/14…115
1/13…82
1/12…92
1/11…130
1/10…99
1/9…108
1/8…114

—Boeing delivered 63 airplanes in December, bringing the manufacturer’s 2025 total to 600 jets and giving it the busiest shipping year since 2018.

The company also reported 174 net orders for the month, after adjusting for cancellations and jets taken out of reserve.  The largest buyer by far was Alaska Airlines, which announced last week that it would buy 105 737 MAX jets and five 787 Dreamliners.

Boeing said its total backlog now stands at 6,130 planes.

The company still trails European rival Airbus, which said it shipped 793 jets during the year, with 136 planes delivered in December.

—Google parent Alphabet’s value topped $4 trillion, making it the latest tech company to cross that threshold as investors reward the internet-search leader for its artificial-intelligence gains.

Apple and Microsoft both crossed the $4 trillion threshold last year but have fallen below that level.  Only Nvidia is still above that mark.

Google is profiting from the recent launch of its Gemini 3 model, which earned praise for its speed, intelligence and creative capabilities.

Microsoft on Tuesday unveiled a community-focused initiative aimed at lowering water usage at its U.S. data centers and ensuring that the power-hungry facilities do not drive up electricity prices for the public.

The company will pay utility rates high enough to cover its electricity costs and work with local utilities to expand power supply and add the required infrastructure to the grid when needed for its data centers.

Microsoft also pledged to replenish more water than its data centers consume.

The announcement came after President Trump said the tech giant would make “major changes” in its AI infrastructure plans to make sure consumers do not pay more for electricity because of data centers’ power consumption amid rising electricity prices.

Following Microsoft’s compliance, Amazon.com, Google-parent Alphabet, and Meta Platforms are unlikely to be far behind.

It’s a threat that was foreseeable.  U.S. power demand in 2030 is set to be 25% higher than in 2023 largely due to data centers, according to consulting firm ICF.  Most of that will have to come from the same grid that serves residential needs.  Investors will have to wait for more details on Trump’s proposals but it could mean AI companies taking on a chunk of a projected $1 trillion investment by utilities between 2025 and 2029.

But the Magnificent Seven group of megacaps are expected to report 20% earnings growth for the fourth quarter of 2025, compared with an average of 6% for the other 493 members of the S&P 500, according to the BlackRock Investment Institute.  Alphabet is on a roll after striking a deal to power Apple’s Siri digital assistant.

For 2026, the Mag Seven are projected to report 19% earnings growth compared with 15% for the rest of the S&P 500.

—Taiwan-based TSMC, the world’s largest contract chip maker, plans to increase its capital spending by nearly 40% this year after it reported a 355 jump in its net profit for the latest quarter thanks to the boom in artificial intelligence, the company said Thursday.

Taiwan Semiconductor Manufacturing Corp., a major supplier to companies including Nvidia and Apple, reported a net profit of $16 billion for the October-December quarter, a 35% surge from a year earlier, better than expected.

TSMC said revenue in its last quarter increased 21% from a year earlier to $33 billion.

The company also said it plans to boost its capital expenditure budget to $52 billion-$56 billion for 2026, up from about $40 billion last year.  The company’s shares surged 6% on the news.

“We expect our business to be supported by continuous strong demand for our leading edge process technologies,” Wendell Huang, TSMC’s chief financial officer, said in a call with analysts.  He said spending would be “significantly higher” in the next three years.

Asked about concerns over an AI bubble, TSMC chairman and CEO C.C. Wei said he is confident that the growing demand from customers is real.

“I’m also very nervous about it, you bet,” said Wei. “AI is real. Not only real, it’s starting to grow into our daily life.”

Separately, the U.S. and Taiwan agreed to a long-sought trade agreement that would lower tariffs on goods from the self-governed island to 15% and see Taiwanese semiconductor companies increase financing for American operations by $500 billion.

Under the terms, which the White House announced on Thursday, duties on Taiwanese shipments would fall from the previous 20% rate – putting them on par with Japan and Soth Korea, which reached their own agreements last year.

Taiwan’s technology industry would also commit to making at least $250 billion in direct investments to expand advanced semiconductor, energy and AI operations in the U.S.  In addition, Taiwan agreed to provide an additional $250 billion in credit guarantees for further investment in the American semiconductor supply chain.

—Paramount Skydance plans to launch a proxy fight for board seats at Warner Bros. Discovery, the company said Monday, as it continues pushing its hostile bid for the company.

Paramount also filed a lawsuit seeking to force Warner to release more information about its merger agreement with Netflix.  Paramount has long argued its offer, which Warner repeatedly rebuffed, is superior in value to Netflix’s.

Warner “has provided increasingly novel reasons for avoiding a transaction with Paramount, but what it has never said, because it cannot, is that the Netflix transaction is financially superior to our actual offer,” Paramount said.

Paramount is seeking to buy all of Warner including its cable networks for $77.9 billion. Netflix is only looking to acquire the company’s movie and TV studios and HBO channel and related streaming business for $72 billion after Warner splits itself in two, leaving its cable-TV networks (like CNN and TNT) in a separate publicly traded company.

Part of Warner’s reasoning for favoring Netflix’s deal has been the fact that its stockholders would retain shares in the portion of the company that Netflix doesn’t buy, giving them access to potential upside.  Paramount, on the other hand, said last week it believes that business isn’t worth anything.

But, according to reports, Netflix was preparing to change its bid to an all-cash offer, which would expedite the sale.

—Verizon cellphone users suffered through a massive outrage Wednesday lasting for hours, Verizon blaming it on a software issue.

A boon for AT&T and T-Mobile, with Verizon offering $20 credits.

–Swedish telecom-equipment company Ericsson said it would cut around 1,600 jobs in Sweden as it seeks to lower costs and boost competitiveness.

The proposal to cut around 12% of its workforce in the country forms part of its global plans to improve its cost base while maintaining investments in technology and executing its strategy.

The company cut 1,400 jobs in Sweden in 2023 and a further 1,200 in the country in 2024.

“The mobile network market still shows no growth and inflationary pressures are expected to continue,” a spokesperson said Thursday.  “This means that we need to work on our costs.”

—Vail Resorts said far fewer skiers have visited its mountains so far this season, in large part because of low levels of snowfall.

Season-to-date total skier visits were down 20% through Jan. 4, compared with the prior-year period, the company said Thursday. Revenue from ski school, dining and lift-ticket sales fell, too.

Snowfall at the company’s Western U.S. resorts for November and December measured about 50% below the historical 30-year average, CEO Rob Katz said.  In the Rocky Mountains, only about 11% of terrain opened in December because snowfall was nearly 60% below the 30-year average.

The company has done better at its East Coast resorts, which have ample snow.

Foreign Affairs

Iran: Protests and violence surged across the country over the weekend as the death toll rose Tuesday to at least 2,400 and as high as 3,000 according to various rights groups and senior Iranian officials.  Up to 200 of the deaths could be Iranian security personnel.

Iranian state television offered the first official acknowledgement of the deaths, quoting an official saying the country had “a lot of martyrs” and that it did not release a toll earlier because of the dead suffering gruesome injuries.  However, that statement came only after activists reported their toll.

Last Friday, President Trump said Iran was in “big trouble” and warned “you better not start shooting because we’ll start shooting too.”

But the Iranian regime did start shooting, with at least 18,000 detained (at last report).  By Wednesday there was talk of executions without trial.

Last Saturday Trump wrote on Truth Social:

“Iran is looking at FREEDOM, perhaps like never before.  The USA stands ready to help!!!”

Iran Parliament Speaker Mohammad Bagher Ghalibaf said in remarks broadcast on state television: “In the event of a U.S. military attack, both the occupied territories and U.S. military and shipping centers will be legitimate targets for us.”

He reiterated a warning that Iran could act preemptively against potential threats.  “Within the framework of legitimate self-defense, we do not limit ourselves to responding only after an attack,” he said.

Israel’s Army Radio reported Sunday that the country’s security establishment views it as unlikely that Iran will attack Israel at this stage.  “No such immediate willingness is identified in Israel – but rather an Iranian focus on internal matters,” it said.

Iranian President Masoud Pezeshkian blamed the U.S. and Israel for ordering “rioters” to create instability in Iran in a speech released Sunday.

He called on Iranians to distance themselves from “rioters and terrorists,” adding that his government was determined to resolve people’s economic problems.

“The U.S. and Israel are sitting there, giving instructions – saying, ‘Go ahead, we are with you.’  The same ones who attacked this country and killed our youth and our children are now instructing these people to carry out these acts, telling them to destroy and promising support afterward,” he said.

On Saturday night, Crown Prince Reza Pahlavi (the eldest son of the last Shah of Iran living in exile) urged Iranians to maintain their protests for a third consecutive night, claiming the demonstrations had significantly weakened the Islamic Republic’s ability to respond.

“By your widespread and courageous presence in the streets across Iran for the third consecutive night, you have severely weakened Khamenei’s repressive apparatus and his regime,” Pahlavi said in a video message released on social media.

He asserted that he had received “reliable reports” indicating authorities were facing “a severe shortage of mercenaries to confront the millions of people in the streets,” adding that “many armed and security forces have left their workplaces or disobeyed orders to suppress the people.”

Pahlavi also emphasized international support for the protests, saying Iranians abroad were “proudly shouting your voice” and that “the world today stands with your national revolution and admires your courage.”  He added that President Trump “has closely observed your indescribable bravery and has declared that he is ready to help you.”

“Do not abandon the streets. My heart is with you.  I know that I will soon be by your side,” his message concluded.

With the internet down in Iran and phone lines cut off, gauging the demonstrations from abroad grew more difficult, though confirmed videos were leaking out, likely using Starlink* satellite transmitters.

“The pattern of protests in the capital has largely taken the form of scattered, short-lived, and fluid gatherings, an approach shaped in response to the heavy presence of security forces and increased field pressure,” the Human Rights Activists News Agency said. “Reports were received of surveillance drones flying overhead and movements by security forces around protest locations, indicating ongoing monitoring and security control.”

*Starlink users in Iran could use the service for free on Tuesday and Wednesday, according to U.S.-based organizations that work on international technology issues.  Starlink’s parent SpaceX and Elon Musk did not comment.

Sunday, Supreme Leader Ayatollah Khamenei alleged the protesters were made up of rioters and “hirelings” acting on Trump’s behalf.

“The U.S. President who judges arrogantly about the whole world should know that tyrants & Arrogant rulers of the world, such as Pharaoh, Nimrod, Mohammad Reza [Pahlavi] & other such rulers saw their downfall when they were at the peak of their hubris. He too will fail,” Khamenei said in a post on X.

Sunday night on Air Force One, President Trump told reporters that Iran is “starting to” cross a red line with the number of protesters dying.

“There seemed to be some people killed that aren’t supposed to be killed,” Trump said. “But we’re looking at it very seriously. The military is looking at it and we’re looking at some strong options and we’re going to [make] a determination.”

Trump on Monday announced sweeping new tariffs targeting nations maintaining commercial ties with Iran.

Effective immediately, the U.S. will impose a 25% tariff on all goods and services imported from any country that “does business” with Iran, Trump posted on Truth Social.

The president characterized the order as “final and conclusive.”

“Effective immediately, any country doing business with the Islamic Republic of Iran will pay a tariff of 25% on any and all business being done with the United States of America.  This Order is final and conclusive,” he said.

While the order is global, it is expected to hit major economies, specifically India and China, the hardest, given their significant energy and commercial ties with Tehran.  Other countries include Turkey, the United Arab Emirates as well as the European Union.

China’s embassy in Washington called the measure “coercion” and “pressure.”

Chinese Foreign Ministry spokeswoman Mao Ning on Monday said Beijing hoped Iran’s government and its people would overcome “current difficulties” and uphold stability in the country.

“We always oppose interference in other countries’ internal affairs,” she said at a press conference, responding to questions about Trump’s threats to attack Iran.

“The sovereignty and territorial integrity of all countries should be respected and [we] oppose the use or threat of force in international relations.  We call on parties to act in ways conducive to peace and stability in the Middle East.”

President Trump on Truth Social Tues. a.m.

“Iranian Patriots, KEEP PROTESTING – TAKE OVER YOUR INSTITUTIONS!!!  Save the names of the killers and abusers. They will pay a big price.  I have cancelled all meetings with Iranian officials until the senseless killing of protesters STOPS.  HELP IS ON ITS WAY. MIGA!!! PRESIDENT DONALD J. TRUMP”

The Wall Street Journal reported that prominent Iranian reformists, including President Pezeshkian, now support the crackdown on protesters “as the regime closes ranks in the face of one of the biggest challenges to its power.”

It was just last week Pezeshkian called for a more conciliatory approach to the protesters, but now you see his above-noted comments.

As the protests grow, regime supporters are afraid they will go down with any collapse of the Islamic Republic, Iran analysts say.

The protests are “no longer about transforming the regime but overthrowing it,” said Sanam Vakil, director of the Middle East-North Africa program at Britain’s Royal Institute of International Affairs, or Chatham House.  For the reformers too, “if the ship goes down, they are sinking with it,” she said.

Iran’s Arab rivals across the Persian Gulf, led by Saudi Arabia, have been lobbying the Trump administration against a strike on Tehran, after the U.S. warned them to be prepared for such an attack.

Behind the scenes, the Saudis, Oman and Qatar are telling the White House that an attempt to topple the Iranian regime would rattle oil markets and ultimately hurt the US. economy.  But most of all they fear the blowback at home.

For one, there is the very real fear a strike on Iran would risk disrupting oil tankers moving through the Strait of Hormuz, through which passes around a fifth of the world’s oil shipments.

Wednesday afternoon, during an event in the Oval Office, Trump said “important sources” in Tehran told the U.S. government that the regime has halted its brutal crackdown on protesters, leaving open the question of whether he intends to order military strikes after repeated warnings.

Trump said Iran had notified Washington it would no longer carry out hangings of protesters. When asked by a reporter if that meant a U.S. military response was now off the table, he said only, “We’re going to watch and see.”

“We’ve been told,” the president said, “that the killing in Iran is stopping.”

Trump was advised that a large-scale strike against Iran was unlikely to make the government fall and could spark a wider conflict, U.S. officials said, and for now will monitor how Tehran handles protesters before deciding on the scope of a potential attack.

The U.S. would need more firepower in the region both to launch a large-scale strike and protect American forces and allies like Israel should Iran retaliate, the officials said.

The USS Abraham Lincoln was rushing to the Middle East from the South China Sea.

Families of people killed in the protests in Iran have told news organizations, including the BBC, that the authorities are demanding large sums of money to return their bodies for burial.

One family in the northern city of Rasht told the BBC that security forces demanded $5,000 to release the body of their loved one.

—

Russia/Ukraine: The news flow was minimal out of Ukraine this week, which you’d think is good, at least better, but the Russian attacks continue.  Going back to Sunday, more than 1,000 apartment buildings in Kyiv were without power 48 hours later after a devastating attack on the capital last Friday.

President Volodymyr Zelensky said work was proceeding to restore power but that the situation was “still extremely difficult,” particularly in border regions.

“Repair work is still proceeding in Kyiv after the strike that occurred the day before yesterday,” Zelensky said in his nighty video address. “The main task is to restore power supply to all buildings.”

Russia launched 1,100 drones, more than 890 guided aerial bombs and over 50 missiles, including ballistic, crude and medium-range weapons, against Ukraine over the past week.

Last Friday, the missile strike on Kyiv left virtually the entire city without power and heating amid a sharp cold snap, and it was not until Sunday that authorities restored water supplies and partially restored electricity and heating.

The war’s fourth winter could be the coldest and darkest yet, with temperatures at -12C (10F), and it got colder after that. In fact, the high temperature in Kyiv didn’t hit 20F all week and is not forecast to hit this level the next two weeks! [Save for one day when it might make it to 21F.]

Monday night, Russia struck again, targeting energy-generation facilities and substations, killing at least four (all in Kharkiv) and knocking out heat and power again to millions across the country.  This attack consisted of 300 drones, 18 ballistic missiles and seven cruise missiles, with the Ukrainian Air Force saying 24 sites saw damage.

—U.S. funding of Ukraine will not materialize until lawmakers pass a full-year defense appropriations bill.  Yes, the 2026 National Defense Authorization Act was signed into law last month, authorizing $400 million for the Ukraine National Security Assistance Initiative, but the NDAA is only an authorization bill, not an actual release of funds.

This is all part of the latest attempt to prevent another government shutdown end of the month.

Venezuela/Cuba: Multiple Americans who were detained in Venezuela have been released, the Trump administration said Tuesday.

“We welcome the release of detained Americans in Venezuela,” the State Department said.  “This is an important step in the right direction by the interim authorities.”

As of Tuesday evening, the Venezuelan human rights group Foro Penal had confirmed 56 prisoners it said were detained for political reasons had been freed.  The group criticized the lack of government transparency over the releases.  Venezuela’s government negated the organization’s count and reported a far higher figure of 400 Tuesday afternoon.

But the government did not provide evidence of the releases or a time range in which they were carried out, nor did it identify those freed, making it impossible to determine whether those freed were behind bars for political or other reasons.

Meanwhile…President Trump on Truth Social, Sunday a.m.

“Cuba lived, for many years, on large amounts of OIL and MONEY from Venezuela.  In return, Cuba provided ‘Security Services’ for the last two Venezuelan dictators, BUT NOT ANYMORE!  Most of those Cubans are DEAD from last weeks [sic] U.S.A. attack, and Venezuela doesn’t need protection anymore from the thugs and extortionists who held them hostage for so many years.  Venezuela now has the United States of America, the most powerful military in the World (by far!), to protect them, and protect them we will. THERE WILL BE NO MORE OIL OR MONEY GOING TO CUBA – ZERO! I strongly suggest they make a deal, BEFORE IT IS TOO LATE.  Thank you for your attention to this matter. President DJT”

Wednesday evening, Trump posted:

“This morning I had a very good call with the interim President of Venezuela, Delcy Rodriguez.  We are making tremendous progress, as we help Venezuela stabilize and recover.  Many topics were discussed, including Oil, Minerals, Trade and, of course, National Security.  This partnership between the United States of America and Venezuela will be a spectacular one FOR ALL.  Venezuela will soon be great and prosperous again, perhaps more so than ever before!”

Related to all the above, Senate Republicans voted to dismiss a war powers resolution Wednesday that would have limited President Trump’s ability to conduct further attacks on Venezuela after two GOP senators reversed course on supporting the legislation.

Trump put pressure on five Republican senators who joined with Democrats to advance the resolution last week and ultimately prevailed in heading off passage of the legislation. Two of the Republicans – Sens. Josh Hawley (Mo.) and Todd Young (Ind.) – flipped under the pressure.

Vice President Vance had to break the 50-50 deadlock in the Senate on a Republican motion to dismiss the bills.

“Here we have one of the most successful attacks ever and they find a way to be against it. It’s pretty amazing.  And it’s a shame,” Trump said at a speech in Michigan Tuesday. He also hurled insults at several of the Republicans who advanced the legislation, calling Sen. Rand Paul of Kentucky a “stone cold loser” and Sens. Lisa Murkowski of Alaska and Susan Collins of Maine “disasters.”  Those three Republicans stuck to their support for the legislation.

Thursday, Venezuelan opposition leader and Nobel Peace Prize winner Maria Corina Machado met with President Trump at the White House and she presented Trump with the coveted medal. Speaking to reporters after, she did not say whether Trump accepted it, but the White House confirmed he did.  And Trump posted on Truth Social Thursday evening:

“It was my Great Honor to meet Maria Corina Machado, of Venezuela, today.  She is a wonderful woman who has been through so much.  Maria presented me with her Nobel Peace Prize for the work I have done. Such a wonderful gesture of mutual respect. Thank you Maria!”

Ahead of the meeting, the Nobel Institute clarified in a statement that the “Nobel Prize can neither be revoked, shared, nor transferred to others.  Once the announcement has been made, the decision stands for all time.”

In Venezuela, a new poll found that a majority of the citizens want Machado to lead the country following Maduro’s capture, contradicting Trump’s assertion that she doesn’t have the support to rule.

The survey carried out by AtlasIntel for Bloomberg News also found that the Maduro operation failed to garner widespread support within Venezuela, as concerns swirl about Washington’s intentions and how the Chavista government will respond.

Finally, the U.S. seized a sixth sanctioned oil tanker in the Caribbean Sea, according to a social media post from the Coast Guard.

The vessel had a history of carrying Iranian oil, which prosecutors maintained was sold to finance terrorism.

The Veronica had officially registered as a Russian-flagged vessel last week and had been renamed the Galileo, possibly in an effort to avoid being seized by the United States.

Greenland: Going back to last Friday and a late press conference as I was going to post WIR, President Trump said the U.S. needs to “own” Greenland to prevent Russia and China from doing so.

“Countries have to have ownership and you defend ownership, you don’t defend leases. And we’ll have to defend Greenland,” Trump told reporters.

We will do it “the easy way” or “the hard way,” he added.

In a joint statement on Friday night, Greenland’s party leaders, including the opposition, reiterated their call for the “U.S.’s disregard for our country to end.”

“We do not want to be Americans, we do not want to be Danes, we want to be Greenlanders,” they said. “The future of Greenland must be decided by the Greenlandic people.”

The U.S. already has more than 100 military personnel permanently stationed at its Pituffik base in Greenland’s northwestern tip – a facility that has been operated by the U.S. since World War II.

[At the height of the Cold War, the U.S. had as many as 15,000 military personnel there at 17 installations, serving as an early warning base.  The shortest route for a ballistic missile to reach the U.S. from Russia is over Greenland.]

Under existing agreements with Denmark, the U.S. has the power to bring as many troops as it wants to Greenland.  Over the years, it has also rebuffed Chinese investment given its U.S. alliance, even as Greenland has been trying to diversify its economy beyond fisheries.

But Trump said a lease agreement was not good enough.

“Countries can’t make nine-year deals or even 100-year deals,” he said, adding that they have to have ownership.

“I love the people of China. I love the people of Russia,” Trump said.  “But I don’t want them as a neighbor in Greenland, not going to happen.”

A meeting was then set up between Vice President JD Vance and Secretary of State Rubio for Wednesday with the foreign ministers of Denmark and Greenland.  Prior to the meeting, in a joint press conference in Copenhagen with Danish Prime Minister Mette Frederiksen and Greenland Prime Minister Jens-Frederik Nielsen, Nielsen said, “If we have to choose between the USA and Denmark here and now, we choose Denmark.  We choose NATO, the Kingdom of Denmark, and the EU.”

Trump reacted to Nielsen’s statement Tuesday: “I disagree with him.  I don’t know who he is, don’t know anything about him, but that’s going to be a big problem for him,” Trump told reporters.

Prior to it, Wednesday morning, President Trump posted on Truth Social:

“The United States needs Greenland for the purpose of National Security. It is vital for the Golden Dome that we are building.  NATO should be leading the way for us to get it.  IF WE DON’T, RUSSIA OR CHINA WILL, AND THAT IS NOT GOING TO HAPPEN!  Militarily, without the vast power of the United States, much of which I built during my first term, and am now bringing to a new and even higher level, NATO would not be an effective force or deterrent – Not even close!  They know that, and so do I.  NATO becomes far more formidable and effective with Greenland in the hands of the UNITED STATES.

“Anything less than that is unacceptable.  Thank you for your attention to this matter!  President DJT”

After the meeting, the Danish foreign minister, Lars Lokke Rasmussen, said Denmark, Greenland and the United States have a “fundamental disagreement” over the future of the territory.  “We didn’t manage to change the American position.”  Rasmussen called the discussion “frank” and “constructive” even as he underscored that Denmark has no interest in changing the status quo.

“Our perspectives continue to differ,” he said.  “The president has made his view clear.  And we have a different position.”

He did say the governments will form a working group, likely within weeks, to try to find a path forward that accommodates Trump’s security concerns, without violating the territorial integrity of the Danish kingdom or the Greenlanders’ right to self-determination.

Sen. Mitch McConnell (R-Ky.), the former majority leader, became the latest congressional Republican to push back against Trump’s drive to acquire Greenland either by purchase or force, saying the administration could accomplish its national security objectives in cooperation with Greenland.

“I have yet to hear from this administration a single thing we need from Greenland that this sovereign people is not already willing to grant us,” McConnell said in a floor speech as he warned that the president was risking relationships with key allies.  “Unless and until the president can demonstrate otherwise, then the proposition at hand today is very straightforward: incinerating the hard-won trust of loyal allies in exchange for no meaningful change in U.S. access to the Arctic.”

As tensions simmered in Washington, allies in Europe moved quickly to show support for Greenland.

Sweden on Wednesday pledged to send armed forces to Greenland at Denmark’s request.

France said it planned to open a consulate on the island next month and is preparing to send troops.

Germany said it would send a “reconnaissance team” to the island to “explore the general conditions for possible military contributions to support Denmark.”

The UK said it is considering sending troops.  Norway could as well.

Denmark said its military expansion in Greenland will take place “in close cooperation with allies.”

Last September, all of these nations participated in Arctic Light, a military exercise intended to strengthen the operational readiness of the Danish Armed Forces and NATO in and around Greenland.

And as alluded to up top, all six now reportedly have troops in Greenland.

Israel/Gaza: U.S. Special Envoy Steve Witkoff posted the following Wednesday on Truth Social….

“Today, on behalf of President Trump, we are announcing the launch of Phase Two of the President’s 20-Point Plan to End the Gaza Conflict, moving from ceasefire to demilitarization, technocratic governance, and reconstruction.

“Phase Two establishes a transitional technocratic Palestinian administration in Gaza, the National Committee for the Administration of Gaza (NCAG), and begins the full demilitarization and reconstruction of Gaza, primarily the disarmament of all unauthorized personnel. The U.S. expects Hamas to comply fully with its obligations, including the immediate return of the final deceased hostage.  Failure to do so will bring serious consequences.

“Importantly, Phase One delivered historic humanitarian aid, maintained the ceasefire, returned all living hostages and the remains of twenty-seven of the twenty-eight deceased hostages.  We are deeply grateful to Egypt, Turkey, and Qatar for their indispensable mediation efforts that made all progress to date possible.”

President Trump then posted in part:

“With the support of Egypt, Turkey, and Qatar, we will secure a COMPREHENSIVE Demilitarization Agreement with Hamas, including the surrender of ALL weapons, and the dismantling of EVERY tunnel.  Hamas must IMMEDIATELY honor its commitments, including the return of the final body to Israel, and proceed without delay to full Demilitarization.  As I have said before, they can do this the easy way, or the hard way.  The people of Gaza have suffered long enough. The time is NOW.”

And so we wait to see how Hamas reacts, and what Israeli Prime Minister Netanyahu’s response will be.

Random Musings

—Presidential approval ratings….

Gallup: 36% approve of President Trump’s job performance, while 59% disapprove.  25% of independents approve (Dec. 1-15).

Rasmussen: 45% approve, 53% disapprove (Jan. 16).

A new CNN/SSRS poll has Trump’s approval rating at 39%, 61% disapprove.  Only 30% of Latinos and adults younger than 35 now approve, down from 41% near the start of his term.

A 55% majority say that Trump’s policies have worsened economic conditions in the country, with just 32% saying they’ve made an improvement.

—The New York Times has released excerpts from its extensive interview with President Trump in drips and drabs and Sunday we learned that Trump regretted not ordering the National Guard to seize voting machines in swing states after his loss in the 2020 election, even though he doubted whether the Guard was “sophisticated enough” to carry out the order effectively.

“The remarks by Trump in the interview harked back to one of the most perilous moments from his first term in office, when he was urged by some advisors to order his national security agencies to take control of machines manufactured by Dominion Voting Systems in an effort to find evidence that they had been hacked to rig the election against him.

“The statement also came as he has continued his attacks on digital voting machines, saying that he wants to ‘lead a movement’ to get rid of them altogether in advance of this year’s midterm elections….

“Mr. Trump explored the possibility of seizing the machines [after the 2020 vote].  He raised the question separately with Attorney General William P. Barr, who immediately shot it down. And he directed one of his personal lawyers, Rudolph W. Giuliani, to ask high-ranking officials in the Department of Homeland Security if they could legally seize the machines. Again, he was rebuffed.

“In the end, Mr. Trump did not move forward with the proposal – a decision he said in the interview with The Times that he regretted.

“ ‘Well, I should have,’ he said.

“Asked whether using the military to impound voting machines had been a viable option, the president questioned the sophistication of the National Guard.

“ ‘I don’t know that they are sophisticated enough,’ he said. ‘You know, they’re good warriors.  I’m not sure that they’re sophisticated enough in the ways of crooked Democrats, and the way they cheat, to figure that out.’

“Mr. Trump’s expression of regret, while somewhat vaguely worded, was nonetheless a warning sign that he had not given up on the idea that voting machines were dangerous or that they could be seized in an effort to curb fraud.

“Just last week, he reposted several social media messages that continued to push the claim that Dominion machines had been rigged against him. And last month, he sought to pardon Tina Peters, a former Colorado county clerk who is serving a nine-year prison sentence on state charges of tampering with Dominion machines in an effort to prove that they were used in a plot against Mr. Trump.”

—Multiple senior prosecutors in Washington and Minnesota are leaving their jobs amid turmoil over the Trump administration’s handling of the shooting death of Renee Good in Minneapolis.

The departures include at least five prosecutors from the U.S. attorney’s office in Minneapolis, including the office’s second-in-command, according to emails obtained by the Washington Post and people familiar with the matter.

Violence continued during protests throughout the week.

—George F. Will / Washington Post…on Donald Trump’s latest idea, a knockoff of France’s Arc de Triomphe, “Which is bad enough.”

“Worse, he wants to situate it on a Washington site where it will clutter one of the world’s great urban vistas.  He would place it on the Virginia side of the Memorial Bridge, below the Custis-Lee mansion, which sits on high ground in what became Arlington National Cemetery….

“Trump’s Oval Office, stuffed to overflowing with gold bric-a-brac, might be beautiful to someone who is colorblind.  Or to connoisseurs of high-end Gilded Age brothels.  It would be nice if he would confine his ornamenting fidgets to Mar-a-Lago, about which we can say what a wit said of the State Department: It is like tundra – anything done to it would improve it.  The Oval Office can be, as it were, visually fumigated quickly for the next occupant.  Getting rid of an Arc de Trump would be resisted by curators of Trump’s legacy….

“The Arc de triomphe was commissioned by Napoleon in 1806, after his victory in the immense 1805 battle of Austerlitz, to celebrate France’s military glories, and himself.  At Austerlitz, which was then in Moravia but now is in the Czech Republic, Napoleon’s 68,000 troops defeated almost 90,000 Russians and Austrians.

“Perhaps the Arc de Trump, its gold paint glistening when bathed by sunsets, will celebrate, in addition to its namesake, the triumph of U.S. forces in the Battle of Nuuk.  With a population of less than 20,000, and boasting that its rush hour traffic lasts 15 minutes, Nuuk is the capital of, and largest city, in Greenland.”

–As follow up to my note on Australia’s heat wave and fire threat, wildfires did strike the state of Victoria, killing at least one person, destroying over 260 homes and burning nearly 900,000 acres since last week, authorities said in the past few days.  A staggering 20,000 head of livestock were killed.  Much of the country is in the worst fire conditions since Australia’s deadly Black Summer fires in 2019 and 2020.  Most were started by lightning strikes in this recent series of fires.

Temperatures did subside greatly after Melbourne hit 110 last Friday.

–Meanwhile, I saw how thousands of tourists were stranded last weekend in Lapland, Finland as a cold spell grounded flights out of one of its airports.

Departures from Lapland’s Kittila airport that would have ferried winter travelers back to places like London, Bristol, Manchester, Paris and Amsterdam were all cancelled on Sunday as temperatures did not go above -35C on Sunday.  That’s -31F, sports fans!  Good Lord.

At these levels it is extremely difficult to de-ice planes, while maintenance and refueling equipment on the ground can freeze.

Lapland is used to cold temps, with a winter average of -14C (7F).

Why would one go to Lapland?  Well, there are nearby ski resorts and it’s a good place to see the Northern Lights, while the area is also the “official” destination for visitors to Santa Claus’s folkloric home.

After his Christmas journey, Santa and Mrs. Claus took a break and went to St. Bart’s, where they were stranded after the U.S. launched its military operation to capture Nicolas Maduro, thus shutting down the airspace, in case you were wondering.

—Moscow was crippled by its heaviest snowfall in 56 years (146, depending on your source), some 20+ inches in parts.

I’ve been to Moscow twice in the winter (I did this on purpose to get the Dr. Zhivago effect), and some might be surprised to learn that Moscow really doesn’t get big snowfalls.  Just a lot of 1- to 3-inch events.  The thing is you can go weeks without the temperature hitting freezing so what falls stays.

For those who played the board game “Risk” growing up, as I did, “Kamchatka” was hit with feet of snow this week that literally buried structures in snowdrifts.

—El Nino could develop this summer and in terms of this year’s hurricane season, that could be good news.

El Nino typically means fewer Atlantic hurricanes because there is stronger wind shear present, making it more difficult for storms to develop.  However, it is still too early to determine exactly if and when we could see the shift to El Nino and how strong it could be.

I’m still surprised how not one storm developed in the Gulf of Mexico last year.

—

Pray for the men and women of our armed forces…and all the fallen.

Slava Ukraini.

God bless America.

—

Gold $4598…new weekly closing ‘high’…Silver $89.40…
Oil $59.48

Bitcoin $95,500 [4:00 PM ET, Friday…strong week….]

Regular Gas: $2.83; Diesel: $3.51 [$3.10 – $3.60 yr. ago]

Returns for the week 1/12-1/16

Dow Jones  -0.3%  [49359]
S&P 500  -0.4%  [6940]
S&P MidCap  +1.3%
Russell 2000  +2.0%
Nasdaq  -0.7%  [23515]

Returns for the period 1/1/26-1/16/26

Dow Jones  +2.7%
S&P 500  +1.4%
S&P MidCap  +6.1%
Russell 2000  +7.9%
Nasdaq  +1.2%

Bulls 57.4
Bears 16.7

Hang in there.

Brian Trumbore