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The Federal Trade Commission is moving to ensure companies disclose use of customers’ personal data to set prices, as technology makes it easier for retailers to tailor them to individual shoppers.

The FTC said that it is seeking public comment on an enforcement policy statement concerning “personalized pricing,” which the agency defines as using personal data to determine how much a company believes an individual consumer is willing to spend. The proposal would warn companies that failing to disclose that they are using personal data to set prices could violate the FTC Act’s prohibition on unfair or deceptive practices.

“When consumers see a listed price, they expect it to be the same price that everyone else sees, not the retailer’s estimate of how much they are willing to pay based on their personal data,” FTC Chairman Andrew Ferguson said in a press release. “The FTC does not have the legal authority to ban personalized pricing in all circumstances, but businesses that fail to tell consumers how their personal data is being used to set a price may be in violation of the FTC Act and other laws we enforce.”

The FTC did not immediately respond to a request for comment from Fortune. The proposal is open for public comment through Sept. 18.

The regulator’s action comes after more than two years of scrutiny into what it calls “surveillance pricing.” In July 2024, the FTC ordered eight companies involved in pricing technology to provide information about how they use customer data—including location, demographics, credit history and browsing or shopping history to help companies determine prices. 

“Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing,” then FTC Chair Lina M. Khan said at the time, “and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen.”

The FTC’s January 2025 findings said pricing intermediaries could use information ranging from a consumer’s precise location and browser history to shopping behavior and even mouse movements to help retailers tailor prices or promotions. The agency said the companies it examined had worked with at least 250 clients, including grocery retailers.

The deep dive into personalized pricing comes after the FTC recently flagged dynamic pricing—or setting prices based on supply and demand as well as inventory levels and competitor pricing.

An FTC research document noted that companies using e-commerce websites or electronic shelf labels could potentially make price changes with similar frequency.

“Consumers expect prices for products and services to change based upon supply and demand, not their web surfing habits or buying history,” it noted. “Retailers who represent or imply that a price is static when it in fact varies by individual are at risk of misleading customers.”

The distinction is becoming more significant as consumers contend with years of elevated inflation, including higher grocery bills. In July, prices for fruits and vegetables rose 5.1% from a year ago, while nonalcoholic beverages rose 4.1%, according to the Bureau of Labor Statistics. 

Food costs also take up a disproportionate amount of spending in lower-income American households. In 2024, those in the lowest quintile spent an average $5,498 on food—equivalent to 33% of their pretax income—compared to 12.2% for households in the middle income quintile, according to the USDA.

This story was originally featured on Fortune.com

Forget raining cats and dogs: In America’s increasingly crowded skies, it may soon be packages and takeout food falling from above. 

For one Texas woman, the future has already arrived, though perhaps not exactly as Amazon intended. Lindsey Austen was expecting an Amazon delivery by drone Monday when she heard it approaching her home in Richmond, Texas, and ran outside to record the delivery. Instead, she watched as the package dropped straight into her backyard pool. 

“When it went into the pool, I was shocked,” Austen told Storyful. “I don’t think I’ll be wanting drone deliveries anymore.”

The mishap comes at an awkwardly fitting moment for an industry that has spent years promising packages, takeout, and everyday essentials would eventually descend from the sky. After more than a decade of experiments, regulatory hurdles and technical setbacks, some of America’s biggest delivery companies are now making much bigger bets that drones are finally ready for prime time.

Amazon said Wednesday its Prime Air service will expand to nearly 500 U.S. cities and towns by the end of 2026, a sixfold increase from its current footprint. The company currently operates drone delivery from 11 locations and plans to add markets including Chicago, Atlanta, Cleveland, and Syracuse, N.Y.. The company says its drones can deliver millions of eligible products weighing up to five pounds in as little as 30 minutes.

The expansion is the latest attempt to make good on a vision Jeff Bezos laid out more than a decade ago. The Amazon founder unveiled the company’s delivery drones on 60 Minutes in 2013 and predicted drone deliveries could arrive within four to five years. Instead, the program faced regulatory hurdles, technical setbacks, and noise complaints from residents. 

Amazon has delivered hundreds of thousands of packages by drone this year, Prime Air Vice President David Carbon said Wednesday. That remains a sliver of the nearly 20 million packages Amazon delivers each day in the U.S., according to market research firm ShipMatrix, as Fortune reported Wednesday.

But now, Amazon isn’t flying alone.

The drone delivery race takes off

DoorDash recently launched DoorDash Air after receiving a Federal Aviation Administration certification allowing it to operate its own commercial drone delivery service rather than relying solely on outside partners.

The company isn’t positioning drones as a replacement for the people delivering most of its orders. DoorDash told Fortune that Dashers still handle the vast majority of its millions of daily deliveries, including large orders and trips that require navigating apartment buildings. Drones instead join a network that also includes DoorDash’s Dot delivery robot and other autonomous delivery partners.

DoorDash has completed tens of thousands of drone deliveries to date, compared with more than 10 billion orders across its broader network. 

“We want drone delivery to work for any merchant, anywhere,” Harrison Shih, head of DoorDash Air said in a statement provided to Fortune. “Advances in hardware, compute, and AI are creating extraordinary new capabilities for local commerce, and becoming a certified air carrier accelerates everything we’re building.”

Uber is taking a different route into the skies. Rather than building the aircraft itself, it’s turning to Zipline, a drone delivery company most recently valued at $7.6 billion. The companies announced a strategic partnership Monday that will bring drone delivery to Uber Eats later this year. Uber is investing an undisclosed amount in Zipline, and the partnership comes with an ambitious target: 1 million drone deliveries per day by the end of 2029.

Under the partnership, drones would become one option within a delivery network that can also dispatch human couriers and sidewalk robots depending on the order, according to an announcement from Uber shared with Fortune.

Zipline, meanwhile, told Fortune the number of businesses offering delivery through its service grew 13-fold in the first half of 2026. The company now operates in Dallas, Houston, Cleveland, and Northwest Arkansas, with Phoenix and Austin expected to follow later this year. Zipline says it currently makes a delivery somewhere in the world every 20 seconds.

The company estimates there are already 5.5 billion instant deliveries annually in the U.S., excluding deliveries from Amazon, UPS, and FedEx. If the demand it is seeing in Dallas-Fort Worth were replicated nationwide, Zipline projects that could translate to demand for 55 billion deliveries a year.

“We don’t have enough people to make that many deliveries, and we don’t want to add more delivery trucks to the roads, increasing traffic and clogging our streets to move small packages,” Zipline said in a statement provided to Fortune. “Zipline’s drone delivery is the answer.”

The company is betting its new Uber partnership can help take that model nationwide.

Walmart is approaching 2 million drone deliveries, the company told Fortune, up from the 1 million milestone it announced in May. Customers are increasingly using the service for everyday purchases including eggs, ground beef, phone chargers, and ink cartridges, according to the company.

Drone delivery is one piece of Walmart’s broader push to give customers more control over how quickly orders arrive. Its delivery options now range from scheduled window and three-hour on-demand service to one-hour Express delivery and a 30-minutes-or-less option for more immediate purchases.

“Drone delivery gives customers another choice when speed matters, complementing our broader suite of same-day delivery options so they can choose what works best for each shopping mission,” a Walmart spokesperson said in a statement provided to Fortune.

Working with Wing, Alphabet’s drone delivery company, Walmart plans to build a network of more than 270 drone delivery locations in 2027 capable of reaching more than 40 million Americans. Wing and Walmart have since announced seven additional markets, including Philadelphia, Phoenix, San Diego, and the San Francisco Bay Area.

The sudden push toward scale marks a shift for a technology that spent years looking more like a Silicon Valley experiment than a serious alternative to putting a package in a car. Plenty of obstacles remain: Companies still need federal and local approvals, drones have limited carrying capacity and range, and residents have raised concerns about noise, privacy, and safety.

But the numbers companies are now putting behind their ambitions are getting harder to dismiss as experiments: Amazon is targeting nearly 500 cities and towns, Walmart and Wing want to reach more than 40 million Americans, and Uber and Zipline are aiming for one million deliveries a day.

For customers like Austen, there’s still at least one part of the technology that could use some work: the landing.

This story was originally featured on Fortune.com

The bookends of California Gov. Gavin Newsom’s nearly eight years in office have been defined by a crucial question: Who should cover the cost of damage from wildfires caused by utility equipment?

The most destructive wildfire in state history, a blaze that killed 85 people and destroyed more than 18,000 buildings in Northern California, started two days after Newsom won the governorship in 2018. Investigators determined it was caused by Pacific Gas & Electric equipment. Facing tens of billions of dollars in liability, the giant utility filed for bankruptcy just weeks after Newsom’s inauguration.

Months later, Newsom signed a law creating a $21 billion fund, paid for by utility shareholders and ratepayers, to help utilities pay for wildfire damages if they take certain safety measures.

Now, as the final legislative session of his governorship ends, Newsom is trying to broker a deal with lawmakers aimed at further shielding utilities from financial trouble if their equipment sparks a wildfire. His push comes as another major utility, Southern California Edison, faces claims from the state’s second-most destructive blaze, a 2025 fire that killed 19 people outside of Los Angeles. Investigators ruled this month that it was sparked by one of the company’s transmission towers.

Newsom’s plan could limit the amount electric and gas companies have to pay victims and attorneys. One of the goals is to stabilize the state’s electricity rates, which are among the highest in the nation and have continued to climb in recent years. Utilities have raised rates to pay for wildfire prevention and recovery as climate change has made the blazes more intense and frequent. Six of the state’s 10 most destructive wildfires have been caused by utility equipment.

Newsom says the state needs to act quickly because he expects the wildfire fund to run out soon. His plan would require survivors to get paid by utilities sooner.

“Status quo is not going to work,” Newsom recently told reporters. “It’s not going to work for victims, who consistently are last in line. And that’s at the core of this reform.”

But some of those victims are pushing back. They’ve said Newsom’s plan prioritizes utilities over the needs of fire survivors. Meanwhile, insurance companies are concerned they would foot more of the bill for property damage. A coalition including the state’s major utilities — PG&E, Southern California Edison, and San Diego Gas & Electric — has been urging lawmakers to pass the plan. The last-minute legislative battle could help shape Newsom’s legacy as he considers a run for president in 2028.

Newsom says his plan strikes a fair balance

Under California law, utilities have to pay damages for fires ignited by their equipment, even if a judge doesn’t find them negligent. Home insurers that pay for policyholders’ rebuilding expenses can try to get reimbursed by utilities.

Newsom’s plan could change that by making insurance companies cover more of the cost of property damage. The proposal would also require utility CEOs to forfeit bonuses if their company sparks a wildfire resulting in more than $1 billion worth of damage. And utility shareholders could be fined up to $10 million for violating wildfire prevention requirements, according to the governor’s office, which hasn’t released the full details.

Personal Insurance Federation of California, a group representing property insurers across the state, said insurance rates will increase if the plan is implemented. The onus should remain on utilities to pay, said Rex Frazier, the federation’s president.

“Being responsible for your actions is something that parents tell children,” he said in a statement. “Hopefully the Legislature will tell this to the utilities.”

Fire survivors are also frustrated with the plan, which could limit their payouts. Joy Chen, executive director of Every Fire Survivor’s Network, a group of survivors of the 2025 Los Angeles-area fires, blasted it at a virtual town hall this month.

“This is overall a massive transfer of liability for the three for-profit utility monopolies that have continued to burn down communities across California,” Chen said.

The California Professional Firefighters sent a letter to Newsom on Monday expressing its support for his proposal.

“The stability of the state’s utilities, insurance plans, and recovery funds must all be balanced with ensuring that wildfire victims and impacted communities are able to recover and rebuild,” the union wrote.

The Legislature has until Aug. 31 to pass a plan. If they don’t, Newsom could call them back for a special session.

Democratic legislative leaders say the state needs to address the issue but haven’t specified what a deal could include. Newsom proposed another $18 billion last year to supplement the wildfire fund, which the Legislature approved.

An economist says the state should reduce utility liability

California’s longstanding requirement that utilities cover the cost of wildfire damages regardless of whether they were negligent is based on the fact that they are providing a public service, said Meredith Fowlie, an economist who co-directs an energy institute at the University of California, Berkeley.

But as climate change has fueled more frequent and destructive fires, the state should rethink how to distribute the ballooning costs of recovering from those blazes, she said.

“Utilities can start fires, but they don’t by themselves create catastrophe,” Fowlie said.

Other factors make wildfires turn into catastrophes, such as failing to clear vegetation or upgrade homes to make them more fire-resistant, she said. The question of who should be held responsible — and by how much — is “a critical, core issue that we have not dealt with and is not going away,” Fowlie said.

Newsom says he’s prepared to tackle the issue he’s kept revisiting since he took office.

“I’m not going to walk away and hand a real mess to the next governor,” he said last week.

This story was originally featured on Fortune.com

The U.S. plans to reopen a border crossing in Arizona to cattle from Mexico on Monday as part of a broader effort by the Trump administration to reduce record-high beef prices, though economists doubt the move will mean much to grocery store shoppers.

The U.S. Department of Agriculture has said concerns about the New World screwworm’s spread lessened enough to allow the movement of cattle from Mexico at a crossing in Douglas, Arizona, about 230 miles (370 kilometers) southeast of Phoenix. Over time, it hopes to reopen other crossings in New Mexico and Texas.

Beef prices clearly are a concern for President Donald Trump, who announced Friday that he would allow up to 331,000 tons (300,000 metric tons) of imported ground beef into the U.S., tariff-free, to be sold at below-market prices over the next 90 days. In February, the White House said closing the border to livestock imports from Mexico more than a year ago was “essential” to containing the screwworm but it has exacerbated a shortage of cattle for slaughter in the U.S.

“The administration obviously has a lot of incentive to try to be able to say that they’re doing something about high beef prices in particular,” said Derrell Peel, a professor of agribusiness at Oklahoma State University. “Beef has been singled out because it is an expensive product and because it’s just high profile.”

The Trump administration closed the border to cattle imports in May 2025 as part of its response to the screwworm, a parasite with flesh-eating larvae that can infest and even kill cattle or other animals. The move came as the U.S. already was struggling to meet beef demand, thanks to a cattle herd that has been shrinking for five years and now is the smallest in decades.

Because the USDA plans a phased reopening of the border, it will take months for Mexican imports to return to their traditional levels, Peel said. Mexico has traditionally provided 1.1 million head, or about 3% of the U.S. cattle supply.

“I don’t expect to see any measurable impact on cattle prices or beef prices soon,” Peel said.

The smallest US herd in decades fueled record prices

The USDA reported that on Jan. 1, the U.S. cattle herd had dropped to 86.2 million head, the lowest figure in 75 years. Beef prices skyrocketed over the past five years, rising significantly faster than food prices as a whole, according to the U.S. Bureau of Labor Statistics.

The average price of a pound (453 grams) of ground beef rose nearly 57% from July 2021 to July 2026, from $4.39 to $6.89 — hitting a peak of $6.90 in May — with a 10% increase over the previous year. Food prices have risen about 25% overall in those five years, according to the bureau’s numbers.

The price for a pound of uncooked steak rose 35% over the past five years, reaching a record $13.06 per pound in July, also 10% higher than a year before.

But Glynn Tonsor, a professor of agricultural economics at Kansas State University, said the potential effect on beef prices from the smaller supply of cattle was lessened because the U.S. beef industry is more efficient and has been able to get more meat from each animal than in past years.

The USDA says the reopening starts at a safe spot

U.S. government and industry officials view the New World screwworm fly as a major threat to the nation’s $113 billion cattle industry. It was an annual warm-weather scourge for U.S. ranchers from at least the 1930s through the 1960s, until the U.S. largely eradicated it. The fly was contained for years near the Panama Canal, but returned to southern Mexico in late 2024 and advanced toward the U.S., with the first case in Texas since 1966 reported June 3.

Since then, more than 40 cases have been confirmed in southern Texas and southeastern New Mexico, with infestations of cattle, sheep, goats and dogs.

In her July announcement of plans for a phased reopening of the border, U.S. Agriculture Secretary Brooke Rollins said it was possible to start with an Arizona crossing because the northern Mexican states of Sonora and Chihuahua had stronger animal health programs than other parts of Mexico. She also said each animal would be inspected and declared free of the parasite before crossing the border.

U.S. House Agriculture Committee Chair John Boozman said the USDA is taking a “careful, science-based” approach to reopening the border and imposing strong animal health protocols.

“This is an important step for America’s cattle producers, especially our feeders in the border states,” Boozman, an Arkansas Republican, said in a statement. “Restoring this long-standing trade is critical to strengthening our cattle supply and supporting a healthy, competitive beef industry.”

Drought, low prices led to the smallest US herd in 75 years

Drought in cattle-producing regions of the U.S. is a major reason the national herd is so small, said David Anderson, professor of agricultural economics at Texas A&M University. If grass doesn’t grow, cattle have nothing to graze upon, forcing ranchers to sell them off. Low cattle prices over the past two decades also are a factor.

“Where we are today is sort of the culmination of some 18, 19, 20 years of very low cattle prices,” he said. “That forces us to reduce our herds. Drought forces us to reduce them even further.”

The shortage of cattle also has left beef processing plants operating below capacity.

Tyson Foods, one of the nation’s largest meat processors, announced in November that it was reorganizing its beef operations and closing a plant in Lexington, Nebraska, about 220 miles (354 kilometers) southwest of Omaha. Earlier this month, it announced plans to close a plant in Utah outside Salt Lake City and another in Illinois about 150 miles (241 kilometers) southeast of Chicago.

In June, another major U.S. processor, JBS USA, announced plans to close beef plants in Memphis and outside Philadelphia, though it later said it would keep some operations at the Pennsylvania plant to preserve 400 jobs there.

Rebuilding the U.S. herd — and ultimately lowering prices — likely will take years, largely because a cow typically has only one calf a year, Peel said. In addition, breeding a heifer keeps her out of the food supply, tightening it further as the herd is rebuilt.

Peel said prices will remain high for some time and for elected officials, “There’s nothing you can do.”

This story was originally featured on Fortune.com

As Anthropic targets a $2 trillion IPO that could set records—and even eclipse SpaceX—the blockbuster valuation is expected to create an unprecedented amount of wealth for the AI company’s more than 2,500 employees. 

But that potential multimillion-dollar employee windfall appears to be raising concern among company leaders. Anthropic is reportedly now asking job candidates during culture interviews how they would feel if the company someday abandoned its AI ambitions for safety reasons—and that decision caused its stock to fall to zero, according to Axios.

“I was honest and said no, I would not be happy if the stock went to 0,” one candidate, who discussed the interview process on the anonymous workplace site Blind, said. “I would want to align doing the most good and remaining ethical while building a sustaining business.”

Anthropic CEO Dario Amodei, who has an estimated net worth of $15.5 billion, has reportedly expressed concerns about the way the company’s enormous financial incentives could affect its ability to retain employees who are genuinely committed to its mission. Anthropic, a public benefit corporation, has long sought to distinguish itself from competition like OpenAI through a broader focus on AI safety and the “long-term benefit of humanity.”

“At the end of the day, the mission is what we’re all here for,” the company’s values statement reads. “It gives us a shared purpose and allows us to act swiftly together, rather than being pulled in multiple directions by competing goals.”

Anthropic is shelling out base salaries of $400K+ as the battle for tech talent rages on

Anthropic is simultaneously fighting to attract the world’s top AI talent while grappling with what could happen if that talent becomes extraordinarily wealthy in the process. 

The company is competing with the likes of Meta, Google, Microsoft, and OpenAI for top researchers and engineers—and resultantly offering compensation packages well into the hundreds of thousands of dollars.

Anthropic is currently dangling base salaries of $320,000 to $405,000 for staff software engineering roles, for example. And there’s plenty more work to be done. The company currently has more than 500 open roles, including about 90 in sales, over 60 in AI research & engineering, and 47 in security. 

In order to land an offer after such a highly competitive process, some candidates are reportedly spending more than $4,000 on private coaching to help them get hired.

“Spend a few thousand dollars, and now your salary goes up by $200,000—that calculus makes sense,” Aline Lerner, founder of prep company Interviewing.io, told Bloomberg.

AI’s wealth boom could create thousands of millionaires—but Amodei warns it could ‘break society’

The potential wealth creation at Anthropic is part of a much bigger phenomenon unfolding across the AI industry.

Following SpaceX’s $1.77 trillion IPO, thousands of current and former employees—from welders and coders to managers and executives—became millionaires as their company equity soared in value. Roughly 400 current and former SpaceX employees saw their stakes become worth more than $100 million.

As AI valuations continue to soar and employees cash in on equity grants, it is expected that more people will see similar wealth booms. However, Amodei has warned that the economic benefits of AI could become concentrated among a relatively small group of people. As a result, he and Anthropic’s other six cofounders, including his sister, Daniela Amodei, recently committed to giving away 80% of their wealth.

“The thing to worry about is a level of wealth concentration that will break society,” Dario Amodei wrote in a letter published earlier this year.

Amodei called out fellow tech leaders who have grown increasingly skeptical of philanthropy, arguing that wealthy individuals have a responsibility to help address the inequality that AI could exacerbate.

“Wealthy individuals have an obligation to help solve this problem,” Amodei wrote. “It is sad to me that many wealthy individuals (especially in the tech industry) have recently adopted a cynical and nihilistic attitude that philanthropy is inevitably fraudulent or useless.”

Fortune reached out to Anthropic for comment.

This story was originally featured on Fortune.com

The U.S. Secret Service has confirmed it is aware that Iranian state media has aired a video that appears to threaten the life of Barron Trump, President Donald Trump’s youngest son.

“The U.S. Secret Service is aware of the video and investigates anything that can be perceived as a threat toward our protectees,” Secret Service spokesman Nate Herring said in a statement. “Out of concern for operational security, we do not discuss matters of protective intelligence.”

Since the U.S. assassination of Iran’s Ayatollah Ali Khamenei, Iranian media have on multiple occasions circulated content threatening the president and family members. The assassination came at the start of the war in Iran that Trump launched alongside Israel.

CNN previously reported that the Secret Service had knowledge of the Barron Trump threat.

This story was originally featured on Fortune.com

The Trump administration is preparing to revoke the business and tourism visas of up to 200,000 foreigners who have applied for or are currently seeking asylum status in the United States. If it happens, the move would be the largest single mass revocation of visas in U.S. history and would likely face legal challenges.

Unless challenged or revised, the State Department is expected to announce in the coming weeks the revocation of so-called B1 and B2 visas issued between 2016 and 2026 whose holders have sought asylumor are now seeking asylum, according to State Department documents obtained by The Associated Press and two U.S. officials. The action will be taken in coordination with the Department of Homeland Security.

“We are coordinating with DHS to identify and revoke the nonimmigrant visas of foreigners who have come to the United States claiming to be short-term visitors, but then file for asylum to stay here permanently,” said State Department spokesman Tommy Pigott.

He declined to comment on the number of visas that might be revoked, saying “as the process will be ongoing, the number of revocations remains dynamic and will be done on a rolling basis.”

The revocations would not necessarily result in their immediate deportation, the officials said. Most of those with asylum cases currently pending would be recategorized but would lose their status as business or tourism travelers, according to the officials, who spoke on condition of anonymity because the revocations are not final yet.

Since President Donald Trump took office for his second term last year, his administration has steadily ramped up restrictions on visa applicants — demanding more information about their social media histories, requiring the posting of expensive bonds for the processing of visas, and outright banning the issuance of visas to citizens of certain countries.

In a social media post on Monday, Deputy Secretary of State Christopher Landau called out people who he said try to use tourist and business visas to get into the United States and then apply for asylum.

“People in the US and all over the world are fed up with bogus asylum claims,” Landau wrote on X. “Asylum isn’t supposed to be a loophole to circumvent immigration law.” Landau cited the case of a Colombian citizen who came to the U.S. in 2015 on a tourist visa and then applied for asylum.

B1 visas are generally issued for business trips and B2 visas are generally issued for tourism, family visits or medical care. It was not immediately clear from the documents or the officials how many of these visa holders are seeking or have sought asylum in the United States and would be affected by the revocations.

Current applicants for B1 and B2 visas are asked to affirm that they will not apply for asylum in the United States and prove that they intend to return to their home countries.

In the past 18 months, the State Department has revoked about 175,000 visas for people who have been convicted or accused of crimes ranging from drunken driving to rape and robbery, as well as for people who have spoken out publicly against U.S. policies, particularly in the Middle East.

The administration has also moved to crack down on so-called birth tourism, a practice the administration claims is used by foreign pregnant women to come to the United States to give birth so that their child will benefit from birthright citizenship. Trump has tried several times to end birthright citizenship, but those challenges have been rejected by courts, including the Supreme Court.

The State Department documents obtained by the AP suggest screening of current B1 and B2 visa holders began after the State Department received information about asylum requests from the Citizen and Immigration Service.

This story was originally featured on Fortune.com

Hundreds of commercial flights will be told to change their paths over the northeastern Atlantic Ocean during the next two winters to show how minor altitude adjustments can reduce aviation’s climate impact.

The British government is backing the landmark airspace-scale trial, launched Tuesday, to avoid creating condensation trails, or contrails. Google UK is contributing its artificial intelligence-powered forecasts to identify the contrail regions.

When airplanes fly through cold and humid areas, ice crystals can form around the soot particles emitted from the engine, creating clouds that trap heat and warm the planet. The Shanwick Oceanic Control Area in the eastern half of the North Atlantic corridor, the location of the trial, is a busy gateway for air traffic between Europe and North America. It’s also a hot spot for where contrails form.

The 30-month research program known as Operation Blue Skies includes test periods this winter and next, when air traffic controllers will tell some flights to deviate up to 2,000 feet (610 meters) to avoid areas where contrails are likely to form. These will be minor altitude adjustments within standard flight operations, coordinated through established air traffic control communication channels, according to the British government.

There will be about 20 to 40 test days per winter, when there is less air traffic. Around 10,000 flights are expected to pass through the Shanwick airspace during the testing. Hundreds of those flights would deviate their routes. That 1 % to 5% would be enough to demonstrate a statistically significant reduction in contrail formation on an airspace-scale, said Paul Hodgson, Google’s technical lead for Operation Blue Skies.

Individual airlines have tested shifting altitudes to avoid contrail regions. Earlier this year, Google and American Airlines announced that the airline significantly reduced the climate impact of some flights using Google’s AI-based forecasting tool to help prevent contrails.

This new effort expands on individual airline trials to try mitigating contrails across an entire flight corridor.

The thin, white lines that form behind airplanes are responsible for a surprising amount of Earth’s warming — 1% to 2%, according to Contrails.org, a nonprofit research organization dedicated to reducing aviation’s climate impact through contrail management, as part of the Breakthrough Energy group founded by Bill Gates. Modeling shows that the Shanwick airspace accounts for about 5% of the total contributed by contrails, with a significant amount occurring during winter.

Keir Mather, the UK minister responsible for aviation, said the government is partnering with Google to back British experts and innovators to find practical ways to make flying cleaner. The government is paying for more than half of the 5 million pound ($6.76 million) study.

Google called contrails one of the most urgent yet solvable climate challenges facing aviation today.

Hodgson said testing over an airspace, versus individual airline trials, can show how it’s possible to move multiple planes away simultaneously from an area where contrails will form, and can show if contrails can be reduced overall for a region. This could provide a blueprint for similar airspaces, he added.

Along with Google and the UK Department for Transport, the consortium includes the Met Office, the UK’s leading air navigation service provider NATS, Contrails.org, Imperial College London and the University of Cambridge.

An Imperial College London study in 2020 found that small changes to flight paths could reduce the climate impact of contrails. Professor Marc Stettler said Operation Blue Skies is a chance to test that idea in the real world, on a scale never seen before.

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The Associated Press’ climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

This story was originally featured on Fortune.com

The US Securities and Exchange Commission has sent subpoenas to major Wall Street banks regarding the hedge fund Situational Awareness, according to people familiar with the matter.

The information being sought is related to the trading activity of the hedge fund, which came under pressure and was forced to exit many of its positions last month, said the people, who asked not to be identified discussing a confidential matter. The New York Times earlier reported on the SEC’s subpoenas. 

Read More: The 24-Hour Race to Salvage Situational Awareness’ AI Bets

A spokesperson for the SEC declined to comment. An SEC inquiry doesn’t mean that a firm or individual is the focus of an investigation and a probe by the regulator can end without an enforcement action.

The fund began liquidating some of its equity positions as it faced a barrage of margin calls during last month’s AI stock rout. Ken Griffin’s Citadel stepped in to buy the bulk of its public stock bets.

“It is to be expected that regulators would closely examine any funds that are high profile, produce significant returns, or have particularly dramatic drawdowns,” Situational Awareness said in a statement on Monday. “We are a highly-regulated business and will cooperate to the fullest extent with any regulatory request.”

This story was originally featured on Fortune.com

The artificial intelligence boom is driving unprecedented demand for data centers, raising concerns about their growing energy consumption, water use and carbon footprint. These challenges are making companies look beyond traditional land-based data centers.

Some developers are now exploring the ocean as a new location for AI infrastructure in the hopes that underwater data centers could improve energy use and cooling efficiency while using less fresh water and land area than onshore buildings.

My research focuses on the societal, organizational and environmental implications of emerging technologies, particularly artificial intelligence and the digital infrastructure – including data centers – that supports its development and deployment. I see underwater data centers as a promising new approach for supporting the growth of AI.

But moving servers into the ocean does not make other underlying environmental challenges such as energy consumption and carbon emissions disappear. And it creates new concerns about harm to the marine environment, as well as questions about how these data centers can be regulated – and how companies can maintain and expand them if needed. Whether underwater data centers can become sustainable alternatives to traditional data centers depends on solving these economic, technical and environmental problems.

The rise of ocean-based AI infrastructure

In 2015, Microsoft launched a research project to explore the feasibility, benefits and challenges of underwater data centers. Part of that effort included setting up a waterproof data center on the seafloor near Scotland’s Orkney Islands in 2018. It contained 864 servers and was connected to shore by an underwater cable.

After two years, Microsoft reported that the servers in the underwater data center failed at about one-eighth the rate of servers in comparable land-based data centers. The company is still studying the possible reasons but hypothesizes that in a sealed underwater environment the equipment is less exposed to oxygen, humidity and temperature fluctuations – as well as less jostling from people working to replace broken components.

However, Microsoft ended the project in 2024 and chose not to build more underwater data centers. The company didn’t say why, but others’ analyses suggest the reasons could include regulatory concerns, including the need for environmental permits, as well as a desire for faster upgrades and replacements for the computer equipment inside.

Instead the company has focused on land-based data centers, which can be larger and easier to expand, and also easier to access to repair or replace equipment.

Others have moved ahead, though. China built what may be the world’s first wind-powered underwater data center in Shanghai. The facility launched in June 2025 and began full commercial operations in May 2026.

The US$226 million project uses seawater as a coolant rather than have to refrigerate fresh water, reducing the electricity required to cool the computers. It uses at least 30% less electricity than traditional data centers, and offshore wind turbines reduce reliance on fossil fuels and cut the data center’s carbon emissions.

Japan is testing a different approach: Data centers housed in containers on floating platforms at sea can use seawater for cooling, have unobstructed conditions for solar panels and wind turbines, and reduce demand for land. In 2025, a data center in shipping containers opened on a floating platform near Yokohama. Its power comes from solar panels installed on the same floating platform, with batteries providing energy storage. The test will continue through March 2027.

Singapore is also moving toward commercial-scale floating data centers. In 2026, infrastructure company Keppel began building a four-story floating data center, scheduled to open in 2028. The project will use seawater for cooling, reducing reliance on treated water and improving cooling efficiency. And the fact that it floats means it won’t take up any of Singapore’s limited land availability.

In 2025, Ulsan, South Korea, began planning an underwater data center that could house more than 100,000 servers and use 30% less power than land-based centers by using seawater for cooling.

In Maine, DeepGreen Western Passage has proposed a submersible AI data center in the Bay of Fundy, powered by tidal turbines designed to harness the area’s strong tidal currents.

Land-based data centers could also take advantage of seawater cooling. In Portugal, the SIN01 AI data center in Sines uses seawater from the Atlantic to cool its servers before returning it to the ocean.

The promise of ocean-based data centers

These various approaches offer ways to reduce demand for grid-supplied electricity for powering data centers’ computers and cooling equipment, as well as using less fresh water.

The distance from people’s homes could also be an advantage for data centers in or on the ocean. A Gallup poll in March 2026 found that 70% of Americans oppose building AI data centers in their communities. However, more than half of the world’s population lives within 120 miles of a coast. Underwater could be another way to keep data centers physically close to users for speedy service.

Maintenance, though, is a major challenge. If a computer fails underwater, it cannot be repaired or replaced on site. The entire sealed data center module may need to be brought to the surface, even if just one computer needs work.

Can the ocean sustain AI?

The main environmental concern about ocean-based data centers involves the seawater used for cooling. Discharging warm or hot water can potentially affect oxygen levels, pH and marine life in the surrounding waters.

That heat is already apparent at the few seaborne data centers now operating. HiCloud, the engineering contractor for China’s Hainan underwater data center, has reported a temperature increase of less than 1 degree Celsius (1.8 degrees Fahrenheit) in the seawater near the facility. SIN01 in Sines, Portugal, also returns seawater about 1 C warmer.

Many marine species depend on stable water temperatures for breeding, feeding and migration, raising concerns that heat released by multiple underwater data centers could create localized thermal pollution and alter marine ecosystems. And the ocean is already under pressure. UNESCO, the United Nations agency for international cooperation, including in conservation, estimates that about 60% of marine ecosystems are already degraded or used unsustainably.

The ocean is already warming along with the atmosphere, without additional waste heat from data centers. That additional heat is already threatening coral reef and mangrove ecosystems, seagrasses and other aspects of the marine food web. As that warming continues, ocean waters will be less useful for cooling electronic equipment in some regions.

Underwater data centers could help AI grow while easing some of the pressure on land, energy and water. But the real test is whether the ocean can become AI’s next computing frontier without becoming its next environmental problem.

Nir Kshetri, Professor of Management, University of North Carolina – Greensboro

This article is republished from The Conversation under a Creative Commons license. Read the original article.

This story was originally featured on Fortune.com

CEOs have warned that AI will wipe out white-collar and entry-level jobs, but demand for the tools is already creating new opportunities. America’s energy sector is thriving during the world’s latest tech transformation—but there aren’t enough workers to meet the demand. 

The U.S. power and grid value chain will need around 500,000 additional workers by 2030, according to a recent report from Goldman Sachs. And seeing as these roles often require three to four years of training, it creates a years-long skilling obstacle in training up a workforce to meet growing demands. 

The energy apprenticeship pipeline only had 45,000 entrants in 2024, but really needs 65,000 professionals flowing in yearly to close the labor supply gap. And increasing demand for AI—which necessitates an even greater pool of power—could widen the gap even further. 

“Power is a critical bottleneck—but increasingly, the requisite labor presents a structural constraint of its own,” the report explains. “The technical workforce that constructs, wires, cools, and secures this infrastructure is in acute demand, and training cannot happen at the pace capital is being committed.”

America’s energy sector employed roughly 8.5 million workers as of 2024, who took home a median wage of $58,810 a year, according to the U.S. Department of Energy. However, there are more lucrative career opportunities on the table, like traditional fuel production paying an average salary of $65,400, or power plant operators, who take home around $103,600 annually. Plus, energy jobs often don’t require a costly college degree—specialized training and on-the-job experience are king.

But autonomous equipment and human-like robots might have to step in to help lighten the load if worker supply can’t keep up.

Around 1.4 million humanoid robots will hit the market by 2035

The image of robotic arms, drones, and autonomous vehicles taking over factory floors may be jarring to many workers. But Goldman Sachs points out that an increased interest in physical AI like humanoid robots “is centered on the need for labor.” 

So long as people can’t fulfill demands, tech is another tool to help bridge the productivity gap. 

America’s manufacturing sector has a higher number of available jobs than available workers, the study finds, with more than one million materials-handling roles sitting unfilled. And techy companions may be one way to alleviate the shortage. 

Goldman’s investment research projects that the market for humanoids will grow from 20,000 in 2025 to 1.4 million in 2035—a 6,900% increase within the span of a decade. Some Chinese AI developers like Unitree and UBTECH are making headway with the robots, with widespread commercial deployment is expected between 2027 and 2029.

Other faceless autonomous equipment have already hit worksites with that strained labor-supply dynamic; take Deere’s field systems and Caterpillar’s mining platforms, as examples. Earlier this year Amazon also unveiled its autonomous mobile warehouse robot, Proteus. And EV giant Tesla has leveraged its own Optimus humanoid robots inside its manufacturing facilities, taking on early factory tasks and assembly line work. 

However, human-like robots with blank faces and steel legs won’t be marching onto assembly lines anytime soon. Building robots and factories takes years, and requires a load of financing. Private equity firms and banks don’t have much historical financial data to confidently invest in these projects, and companies are still figuring out how to use humanoids at large scale. 

Robot fleets are a few years away—but China’s energy sector is already deploying them

Humanoid robots have yet to take on a sizable amount of America’s blue-collar work, but experts say that the tech is on the up-and-up. Zornitza Todorova, head of thematic FICC research at Barclays, predicts that today’s humanoid market of around $3 billion will swell to $200 billion by 2035. Nvidia CEO Jensen Huang also believes in the potential of humanoid workers, but believes that the true unlock is still years away. 

“I think we are at the cusp of a transformation, we’re just scratching the surface of what humanoid robots can do,” Todorova told CNBC earlier this year, “And as the technology matures, as the models get better and faster at reacting to things in real time, I think we’ll see a lot of applications in more services-oriented roles.”

Meanwhile, China already seems to be racing ahead of the U.S.; the country has deployed robots across several jobs in the energy sector. 

In 2022, a robot completed the work of a maintenance professional by repairing power lines in the Wuhan province; and over at a power facility in Guangzhou, humanoid helpers have already taken over inspection duties usually completed by workers. 

Earlier this year, China announced a $1 billion initiative through the State Grid Corporation of China to get around 8,500 AI-powered robots for national power grid inspection and maintenance.

This story was originally featured on Fortune.com

U.S. futures are lower as bond market pressure will have investors eyeing an annual meeting of top U.S. economic officials at Jackson Hole, Wyoming later in the week.

The future for the S&P 500 was down 0.2%. On Friday, the S&P 500 rose 0.4% for just its second gain in the six days since setting its all-time high last week. Dow Jones Industrial Average futures fell 0.1%, while Nasdaq futures slipped 0.7%.

Investors will get an important inflation update on Wednesday when the U.S. releases its report on personal consumption expenditures, or PCE, for July. It is the Federal Reserve’s preferred measure of inflation. Much like the consumer price index, it has shown that the rate of U.S. consumer inflation remains stubbornly above 3%.

Also on Wednesday, the Commerce Department will issue its second estimate of how the U.S. economy performed in the second quarter of 2026. The government’s first estimate, issued last month, showed that the U.S. economy expanded at a sluggish 1.5% pace from April through June as rising imports weighed on growth.

The Fed has been struggling to get inflation back to its target rate of 2%. Inflation has crept higher after the U.S. imposed a wide range of tariffs globally. It has climbed further as the Iran war slowed global oil shipments from the Strait of Hormuz.

Last week, rising bond yields forced the U.S. Treasury Department into an unusual intervention and raised the specter of higher borrowing costs weighing on consumer spending, the lifeblood of the economy. It also sparked concerns that investors balk at financing a seemingly endless flow of government borrowing.

The bond markets got only temporary relief from Treasury Secretary Scott Bessent’s announcement that the government would double its buybacks of longer-term bonds. That was meant to bring down the 10-year Treasury yield and lower mortgages. The 10-year yield rose back to 4.73% Friday, matching its highest point in more than a year. It was at 4.72% on Monday.

The 30-year Treasury yield, which the Fed is also targeting with its bond repurchases, climbed and is near its highest level since 2007.

Higher yields can slow the economy and undercut prices for all kinds of investments.

The bond market has remained jumpy, and investors will be watching for signals from Federal Reserve Gov. Kevin Warsh regarding rates and other policies in a key speech at the annual gathering of U.S. economic leaders in Jackson Hole later this week.

U.S. markets are also starting the week with a focus on technology stocks. Shares of Sandisk dropped 5%, while Corning slid 3% and Coherent fell more than 5%. Micron Technology’s stock slipped 3%.

Oil prices also declined on Monday as Iran’s currency hit a record low as the U.S. prepared to announce new sanctions to try to break the impasse with Iran, adding pressure when its economy is already battered by earlier sanctions and a U.S. naval blockade.

The rial dropped to 2.02 million to the U.S. dollar on informal currency markets. Iran’s official Central Bank rate stood at around 1.5 million rial to the dollar, but the informal rate is what most Iranians pay.

Uncertainty about when the war with Iran will allow oil tankers to freely exit the Persian Gulf again has roiled markets, causing oil prices to rise and pushing up Treasury yields due to worries over inflation.

The outlook remained murky Monday. The new head of Iran’s top security body warned Sunday that Tehran will see any country’s support for new U.S. economic measures against the Islamic Republic as an “act of war,” while Iran’s president defended a memorandum of understanding with the United States as the best way out of the stalled conflict.

The price for a barrel of Brent crude oil was 1.7% lower at $91.06 on Monday. U.S. benchmark crude fell 2.2% to $85.18 per barrel.

In Europe, Germany’s DAX edged down slightly to 26,133.59, while the CAC 40 in Paris also gave up 0.1%, to 8,480.49. Britain’s FTSE 100 inched up 0.2% to 10,839.52. Asian markets declined.

In other dealings, the U.S. dollar bought 159.23 Japanese yen, up from 158.94 yen late Friday. The euro fell to $1.1665 from $1.1678.

This story was originally featured on Fortune.com

Computer programmer Fei Zhaojun’s boss asked him if artificial intelligence could soon replace humans in coding jobs. Two weeks later, he was laid off from his job in Beijing, together with about 160 of his colleagues.

It’s an increasingly common scenario as artificial intelligence, supported by government policies, reshapes China’s massive job market. Some economists believe that might eventually undermine the overall strength of the world’s second largest economy.

Rapid adoption of AI in many fields, from computer programmers to script writing and physical tasks, is pushing people out of their jobs or leaving them afraid that it might. China is at the vanguard of AI adoption as government policies encourage people and businesses to use AI applications and robotics in all aspects of life, so people like Fei are figuring out how to adapt.

“There appears to be far less anti-AI sentiment in China (than elsewhere). Most people seem either positive, neutral, or mildly interested in AI,” said Shujing He, a Beijing-based senior analyst at advisory and research firm Plenum.

“Individuals who worry about being replaced, as well as those who have already left traditional workplaces, are often eager to experiment with AI-enabled businesses and independent ventures,” she said. “The level of interest is striking.”

Until recently, Fei had doubted AI could do programming work perfectly, even though his bosses thought it was close enough.

“Mid-level coders’ job are essentially replaceable in most of the cases,” said Fei, 40. “Even if it is a disaster that leads to replacing all humans, at this stage, you just have to use it as everyone else is using it.”

Now he’s making vlog-style short videos during a career break while figuring out what he wants to do next. He’s not making a living off of his videos, which are about ordinary people’s lives, but hopes that they might help others.

If you can’t beat them, join them

Du Qinchun, a part-time translator, has been helping to train an AI model to do translations. That’s brought him more work, at least temporarily.

“But it’s true that the pay in the industry has been cut by more than half compared to what it was years ago,” said Du, who is based in southwestern China’s Chengdu city.

The trend is so evident that popular college programs in foreign languages have increasingly fallen out of favor as AI-powered translation tools have become more widespread.

The share of Chinese industrial enterprises saying they use AI models and “agents” jumped to 47.5% last year from 9.6% in 2024, according to the market intelligence firm IDC.

“China’s vibrant open-source model ecosystem fosters greater AI application innovation in industrial settings, gradually closing the gap between foundational model capabilities and real-world enterprise value creation,” said Yanze Du, an IDC senior research manager in Beijing.

Humanoid robots can now, for example, sort parcels in postal centers, although still on a small-scale basis, and are pushing the boundaries in performing more human tasks such as directing traffic and making coffee. Food delivery robots are also gaining ground across the country, potentially threatening the livelihoods of millions of Chinese food delivery workers.

Generative AI increasingly is used for creation, production and distribution in China’s short drama industry. The number of live-action short and vertical video series designed for mobile phones fell about 75% in the first quarter of this year from a year earlier, according to Chinese media reports.

“Tasks that once required specialized training can now be performed by almost anyone with access to AI tools. This is particularly evident in software development and multimedia creation,” said Plenum’s He. “As a result, workers whose roles are narrowly concentrated in these areas may face greater displacement risk.”

A report from International Labor Organization, meanwhile, found that women face higher risks of losing employment due to use of AI than men, as they tend to work in areas more suitable for automation, such as assembling electronics, and remain underrepresented in science and technology.

AI has mixed effects on the slowing economy

Under China’s “AI Plus” initiative and its five-year plan through 2030, the government is pushing to infuse AI across many industries, aiming to gain an edge in China’s technology rivalry with the U.S.

“What is specific to China is that the government is really into diffusing AI across the economy, so AI may get into different domains more quickly comparing to other countries,” said Zilan Qian, a research associate at Oxford China Policy Lab.

China’s economic growth has already been slowing. Consumer spending has lagged partly due to people becoming reluctant to spend because they’re worried about losing their jobs. It’s added to problems stemming from a prolonged downturn in the housing market that has undermined household wealth.

China’s tech industries may be innovative with high productivity, but they may not generate many new jobs, said Eswar Prasad, a professor of economics and trade policy at Cornell University.

“AI is likely to lift productivity across the board but could have a severe disruptive effect on employment, worsening the employment growth problem and resulting in a detrimental effect on social stability,” he said.

Similar to their U.S. rivals, Chinese tech giants have cut or restructured tens of thousands of jobs, partly due to AI. The outlook for the broader jobs market remains uncertain: China’s overall urban unemployment rate hovers around 5%, but unemployment for people aged 16 to 24, excluding students, is roughly triple that.

That said, in the longer run, some experts say unemployment rates could fall, since China’s population of 1.4 billion is rapidly aging and shrinking.

By 2050, China is projected to have fewer than two working-age adults to support each retiree, compared with more than 2.5 in the U.S., said Xuenan Cao, a professor at San Francisco Bay University whose focus includes technology and society.

“Automation could partially offset a shrinking workforce rather than being purely a threat to it,” Cao said.

Some embrace AI to find new ways to make a living

Wang Zhicheng, 32, often used AI for brainstorming and fact-checking in his previous job as a scriptwriter for a company that produces 3D animated educational videos and interactive exercises for children.

After its parent company laid off roughly half of its 13 script writers, he chose to resign and work independently, making illustrated children’s books.

While AI sometimes saved time the scripts it generated, they often felt strange, Wang said. Episodes tended to be repetitive and formulaic and the level of detail devoted to knowledge varied widely.

“You can treat AI as a tool just like (Microsoft) Word,” said Wang, who has started his own studio making picture books and other creative works. “Humans are still the decision makers on which one to pick or pursue among all that AI generates.”

High school chemistry teacher Yang Zheng said he doesn’t consider AI as a threat to his job even though students use AI for help with their homework.

“Teachers cannot be there all the time,” he said. “It is a good thing for students as it generates in real-time so that students can ask follow-up questions,” said Yang, 29. “It often gets things wrong, but it improves over time.”

____

Fu Ting reported from Washington. AP video producer Wu Jia in Beijing contributed to this story.

This story was originally featured on Fortune.com

Giles Sims, 34, was sick of getting passed over for jobs because he didn’t have a college degree.

But with a wife and a widowed mother to help support, he needed a quick solution. So the laid-off web developer turned to one of a growing number of three-year degree programs.

“I can’t afford to be out of the workforce for four years. That just seems like forever, and the three-year made it seem less daunting,” said Sims, a student at Ensign College, a private Salt Lake City school that recently changed all its bachelor’s degrees to require fewer classes than a traditional four-year degree.

The condensed programs have exploded in popularity. As of this spring, 26 U.S. states have a college that offers at least one reduced-credit, three-year bachelor’s, according to the nonprofit research group RAND.

Advocates say these programs are a solution to the college affordability crisis and a godsend for non-traditional students like Sims.

Critics, however, worry that they’ll narrow too much what students learn, confuse employers, limit graduate school options and create headaches in fields that require state licenses.

The American Association of University Professors, for one, says the programs devalue the meaning of a college credential.

“This is not innovation. This is just cutting corners,” said Todd Wolfson, AAUP’s president.

A new option to graduate more quickly, but with reduced credit

For decades, colleges have offered accelerated programs that let students finish faster, often by forgoing long summer breaks, maximizing transfer credits and condensing semester-long courses into shorter, five- to 10-week terms.

But those programs maintained the same course load, measured as credits. The new programs let students finish faster by completing as few as 90 credit hours. That shaves a year off the typical 120-hour bachelor’s degree.

Three-year bachelor’s degrees are common in other countries including the United Kingdom, India, France and Italy. But they can create complications for graduates seeking admission to U.S. graduate schools, which sometimes require extra coursework.

Some of the earliest colleges in colonial America, modeled after English institutions like Oxford and Cambridge, initially had three-year degrees, said John Thelin, the author of “A History of American Higher Education.” By the 19th century, the four-year format had taken hold, partly because there wasn’t an established system of public high schools to prepare students, Thelin said.

“The colleges would have to kind of start from scratch,” he said.

A change in accreditation opened the door to shorter degrees

The idea of bringing three-year degrees to the U.S. got attention in 2009 when Robert Zemsky, the founding director of the Institute for Research on Higher Education at the University of Pennsylvania Graduate School of Education, argued in a Newsweek cover story that three-year degrees could shake up a broken system.

But there was a roadblock, he recalled recently. “Accreditors said, ‘College is 120 credits, not 90 credits,’” he said.

Years passed. And in 2022, amid mounting concerns about college affordability, Zemsky helped revive the idea. The College-in-3 Exchange was born, and dozens of higher education institutions joined the network to look for ways to help students get degrees faster.

The Northwest Commission on Colleges and Universities was the first accreditor to say yes in 2023, when it approved reduced-credit programs at Ensign and Brigham Young University-Idaho. Other accreditors quickly followed.

As of May, 119 reduced-credit programs had been publicly announced, according to the RAND analysis, which was conducted to help education officials in Ohio as they weigh the feasibility of reduced-credit degrees.

It comes at a time when tuition and fees averaged $11,950 for in-state students at public schools and $45,000 at private nonprofits last school year, although many students get discounts that reduce the price, according to a report from the College Board, the nonprofit that oversees the SAT.

Some degrees are easier to compress

Private nonprofit schools offer three-quarters of the reduced-credit programs, frequently online. Typically, they compress the majors by reducing electives. Business degrees in fields such as marketing and management are the most common, followed by computer and information sciences.

Other majors, such as engineering, with its extensive math requirements, have been harder to shrink. And RAND found just six reduced-credit degrees in teacher education, which involves real-world experience requirements and state licensure.

Jill Cohen, 42, lives on a ranch in rural Yoder, Colorado, and is completing her teaching degree through one such program at Indiana Wesleyan.

She quit her old job selling life insurance and turned to teaching after a farming accident nearly claimed her life. Already, she is in the classroom, teaching middle school English, as she works on the degree through a special “Grow Your Own” program designed to address staff shortages.

Because her home is busy — she has twin 12-year-olds, along with a menagerie that includes horses, goats and chickens — she appreciates the streamlined degree.

“Why do I need to take, you know, underwater basket weaving when I could just take the evolutionary structure of the English language — what I’m going to be teaching,” she said.

However, programs with state licensing requirements are one of the biggest worries for Jenna Kramer, a policy researcher at RAND.

Indiana Wesleyan, which has a growing slate of reduced-credit offerings, said its education programs are specifically designed to meet Indiana licensing requirements. Students from elsewhere will need to check if the programs meet their state requirements, said Pam Downing, the school’s director of communications, in an email.

The RAND report also found the programs are so new that there are no standard practices for admitting three-year degree recipients into graduate school.

Students acknowledge it’s a gamble

Gabriella Staten, a 20-year-old student in the reduced-credit digital marketing program at Mount Mary University, a Catholic women’s institution in Milwaukee, estimates it will save her at least $20,000. While she sometimes wonders whether employers will take her degree as seriously as a four-year degree, she decided she could prove herself.

“Even if they were to look a little bit down on the three-year pathway, I can show them otherwise with the work,” she said.

Wesley Hardy, who is three semesters into a bachelor of applied science in accounting at Ensign, also sees the pros and cons. He likes that the three-year format will get him into the workforce faster.

But he noted that the requirements to become a certified public accountant — something he has considered — vary by state. Many require 120 semester hours to sit for the exam and 150 to become licensed. Graduate school often is needed.

Bruce Kusch, president of Ensign, said he has talked to multiple college presidents and doesn’t anticipate that graduate school will be a problem. But Hardy, 22, has questions about how it would work.

“Would I have to take extra classes?” he asked. “It’s definitely something I’ve thought of.”

___

The Associated Press’ education coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

This story was originally featured on Fortune.com

Good morning. CFO turnover is accelerating at the nation’s largest public companies, according to newly released data in Crist Kolder Associates’ mid-year 2026 Volatility Report, shared with CFO Daily.

The executive search firm’s report studied corporate leadership at Fortune 500 and S&P 500 companies, a total of 665 companies. CFO turnover for the full year of 2026 is projected to reach 18.3%, compared to 18.2% in 2020 and 19.3% in 2019. The historical average for CFO turnover over the past 10 years is 16%.

“The demands of the job keep expanding, so it’s no surprise the churn continues,” Scott W. Simmons, co-managing partner at Crist Kolder, told me.

Some CFOs have decided to retire while other finance chiefs are being tapped to steer turnarounds or AI initiatives, for example. 

Several CFO moves in the Fortune 500 stand out from the first half of this year:

AT&T: Pascal Desroches, CFO since 2021, announced he’ll retire effective Dec. 31. Jennifer Biry—a 20-year AT&T finance veteran who most recently was CFO and COO of McAfee—was named deputy CFO effective July 6 and will officially succeed him Jan. 1, 2027.

Caterpillar: CFO Andrew Bonfield elected to retire effective Oct. 1, after eight years. Company veteran Kyle Epley, previously SVP of global finance services, took over as CFO, effective May 1, with Bonfield staying on in an advisory capacity through the transition.

Oracle: Hilary Maxson, former group finance chief at Schneider Electric with infrastructure and energy experience, began her tenure as CFO in April—a hire tied directly to Oracle’s buildout of AI and cloud infrastructure.

Nike: David Denton, a Pfizer finance executive, joined the sneaker and apparel giant as CFO on Aug. 17 as it works through a turnaround.

Pfizer: After David Denton stepped down and left the company on Aug. 15, Cecile Guegan, SVP of finance for the global biopharma business, took over as interim CFO Aug. 16 while Pfizer runs a full internal and external search.

(You can find more Fortune 500 moves here.)

Another finding from the mid-year 2026 Volatility Report, which is based on data through July 31, is that newly appointed CFOs are getting younger. The average age for a CFO in 2026 is projected to be 48, compared to an average of 52 in 2025.

Simmons explained that the average tenure of a sitting CFO is 4.5 years, and newly appointed CFOs only come from another sitting CFO position roughly 25% of the time.

“Those two data points taken together suggest the need to tap into talent that may be younger and less experienced,” he said.

Have a good weekend.

Sheryl Estrada
Sheryl.Estrada@fortune.com

This story was originally featured on Fortune.com

President Donald Trump is moving toward levying a new tariff on China that would penalize the world’s second-largest economy for flooding the global market with underpriced goods, according to three people familiar with the matter.

Two of the people, who spoke on condition of anonymity to discuss internal deliberations still being finalized, said Trump is considering setting the new tariff at 7.5%. It’s a level administration officials believe would not endanger the one-year trade truce between Washington and Beijing or a planned White House meeting between Trump and Chinese President Xi Jinping expected to take place in late September.

The move, if finalized, appears to be a calibrated effort by the White House to work around a Supreme Court decision earlier this year that struck down Trump’s plan to implement a sweeping, high-tariff scheme not seen since the 1930s.

After that decision, the Trump administration announced in March it was launching formal investigations targeting excess industrial capacity and forced-labor regulations in China and other nations.

It isn’t clear if the U.S. administration is also nearing its decision in its probes of the other economies that it announced it was investigating for unfair trade practices, including the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, South Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan and India.

The White House and the U.S. Trade Representative’s office did not respond to requests for comment on the tariff deliberations, which Bloomberg News reported earlier Monday. The Chinese embassy in Washington also did not immediately respond to a request for comment.

The excess industrial capacity probe of China was initiated under Section 301 of the Trade Act of 1974, which allows the president to levy tariffs against nations that discriminate against U.S. companies or commerce.

The new tariff would come on top of existing tariffs on China

The people familiar with the deliberations stressed that Trump could still change his mind on the new tariff on China.

It would come on top of tariffs of 10% to 12.5% announced last month for 60 economies around the globe that the Trump administration accused of failing to effectively enforce a ban on goods produced with forced labor.

Many countries, including China, protested that move, which took effect just as the clock ran out on temporary tariffs Trump had turned to after the Supreme Court in February struck down sweeping “reciprocal” tariffshe levied on nearly every U.S. trade partner.

China last month pushed back against claims of overcapacity, anticipating that the U.S. would soon release results of its probe and impose new tariffs.

Massive capacity in a slew of Chinese industries, from autos to solar panels, cement and steel manufacturing, has drawn increased attention from Beijing’s trading partners in recent years.

Although China’s own leaders have prioritized rebalancing the economy, slowing domestic demand has prompted companies to expand into overseas markets. Surging exports pushed China’s trade surplus to a record of nearly $1.2 trillion last year.

China has never sought a large trade surplus, the Ministry of Commerce said in a recently published report titled “China’s Position on the So-called Excess Capacity Issue.”

The deliberations come as the Treasury Department on Monday warned countries doing trade with Iran that new secondary sanctions are in the pipeline aimed at ostracizing nations that continue to do business with Tehran. China is Iran’s biggest trade partner.

Washington has promised the new sanctions would put even more pressure on an Iranian economy already battered by previous sanctions and a U.S. naval blockade as the U.S. and Israeli war against Iran nears the six-month mark.

Treasury Secretary Scott Bessent’s announcement Monday provided little detail and did not name which countries could face secondary sanctions.

This story was originally featured on Fortune.com

For a man reportedly worth more than $10 billion, entrepreneur Mark Cuban spends a lot of time talking about wealth inequality—and how to distribute it more evenly.

The ‘Shark Tank’ star has long shared suggestions—and has enacted his plans—to better balance income throughout the U.S. economy. One of Cuban’s ideas was to give employees company stock: he told a recent episode of the ‘What It Takes’ podcast that he awarded 330 employees at his media company, Broadcast.com, stock ahead of Yahoo’s $5.7 billion acquisition of the company in 1999. Three hundred of those employees became millionaires as a result, he said.

Cuban also awarded equity and cash bonuses to employees of his first IT consulting company, MicroSolutions.

But the famed investor has now taken the suggestion a step further: If founders and CEOs don’t seek to share the wealth generated by their companies with their employees, they should be forced to give back to society by paying higher corporate taxes.

Writing on X, the cofounder of online pharmacy Cost Plus Drugs, was asked what his plan would be to reduce wealth inequality across the country. He responded: “Increase the taxes of any company that doesn’t offer equity to every employee on a pro rata basis to non-founder executives. If they get rich from the market, so do they.

“It’s exactly what I have done for employees in companies I have started. Most wealthy people get that way from selling their companies or taking them public.”

While Cuban proposes increased taxes as a motivator to get business leaders to share equity more broadly, a criticism of higher taxes (and tariffs, as consumers have learned the hard way) is that increases to company costs are often passed back to customers and ultimately the public. This represents a further stretch on budgets of consumers already dealing with above-target inflation, and without the boon of company stock to fall back on.

But Cuban disagrees, sharing his thinking on the social media platform owned by Tesla CEO Elon Musk: “Each entrepreneur decides what margins, gross or net, they are willing to accept. For competitive or any other reason.”

“Some of us realize that even though we might not enjoy paying taxes, and know that maybe 40% of the taxes paid actually get to people who need it, that’s still a value for the community, which can help your business. As far as equity. Every founder worth a damn knows that the greatest success, economic and personal, comes from aligning the goals and interests of as many stakeholders as possible. Everyone will benefit more, when everyone benefits more.”

Wealth imbalance is tipping

Wealth distribution has shifted toward the top end of the income ladder in recent years, and is expected to do so courtesy of the wealth effects generated by artificial intelligence.

According to Federal Reserve data, in Q1 of 2016, the bottom 50% of the wealth distribution owned $1.02 trillion in assets. The top 0.1% owned $10.75 trillion.

Compared to Q1 of 2026, the bottom 50% now own $4.27 trillion, a more than 300% increase over the past decade. However, the top 0.1% own $25.07 trillion in assets—a smaller percentage increase but a much higher leap in value.

Cuban’s suggestion can also be observed in the Fed data another way: At the time of writing, the top 90% to 99% of the wealth percentile own $20.5 trillion in corporate equities and mutual funds, while the bottom 50% own a little under $0.6 trillion.

Cuban isn’t the only entrepreneur thinking about wealth inequality, particularly when the AI stock boom is powering wealth creation in the U.S. at present. Jensen Huang, whose wealth has rocketed courtesy of his chipmaking company Nvidia, has been joined in billionaire rankings by members of his leadership team. Per calculations by the Bloomberg Billionaires Index, Nvidia’s CFO Colette Kress and its executive vice president of worldwide field operations, Jay Puri, are now both worth more than a billion dollars courtesy of their stock holdings.

Tech companies may be forced to grapple with the effects of rewarding their staff so well: After all, how do you keep teams motivated if they’re worth 10 figures?

Huang reasoned it out on a panel hosted by venture capitalists running the All-In podcast last year, saying: “I review everybody’s compensation up to this day. I sort through all 42,000 employees, and 100% of the time, I increase the company’s spend on [operating expenses]. And the reason for that is because you take care of people, everything else takes care of itself.”

Cuban is inclined to agree, writing on X overnight: “If we continue to see growing disparity in income, you risk unrest and further division, which is the most expensive tax on every business.”

This story was originally featured on Fortune.com

For roughly 76 million American households, federal income taxes could eventually disappear—if a proposal by billionaire Amazon founder Jeff Bezos ever becomes reality.

The Blue Origin owner argued the bottom half of U.S. earners should pay no income tax, saying working Americans shouldn’t be placed under increased financial pressure, considering they contribute a relatively small share of total tax revenue anyway.

“The bottom half of income earners in this country pay only 3% of the taxes,” Bezos told CNBC. “I think it should be zero.”

To make his case, Bezos used a hypothetical health care worker as an example: “Why is a nurse in Queens who makes $75,000 a year paying more than $1,000 a month in taxes?”

Bezos added: “To me, it’s kind of absurd that we’re doing this. We shouldn’t be asking this nurse in Queens to send money to Washington. They should be sending her an apology. It really makes no sense.”

While Bezos did not elaborate on his exact calculations, but workers in the U.S. are generally required to pay federal income, Social Security, Medicare—and in most states, state income—taxes. Combined, it can stretch into the thousands of dollars.

Because the U.S. tax system is progressive, higher earners generally pay a larger share of their income in federal taxes. In 2023, the bottom half of taxpayers (those making roughly under $54,000) accounted for roughly 12% of total adjusted gross income—but they paid just 3% of all federal income taxes, according to IRS data analyzed by the Tax Foundation. The average household in that group paid about $913 a year in federal income tax. However, when refundable tax credits are factored in, the bottom 40% of taxpayers already pay effectively no federal income tax on average, CNBC reported.

Bezos, who has maintained a warm relationship with President Donald Trump, said he plans to advocate for the idea with political leaders, arguing exempting lower earners from federal income taxes would represent only “a small amount of money for the government.” 

“It is part of our job as citizens and as business leaders to share our ideas,” Bezos said. “And this one would actually help people.”

Bezos—with a net worth of $280 billion—says even if his tax bill was doubled, it wouldn’t help

Bezos’s concern for affordability may come as a surprise considering his estimated net worth north of $280 billion—among the top five of any person in the world. And while he said he personally pays “billions of dollars” in taxes, his tax history has long drawn scrutiny. 

A ProPublica investigation released in 2021 found that Bezos—like several of America’s wealthiest billionaires—used tax strategies that have dramatically reduced his tax burden in certain years. In 2007 and 2011, for example, he paid no federal income tax at all, in part because investment losses outweighed reported income. Analyzing Bezos’s wealth growth alongside his reported income and taxes paid between 2014 and 2018, ProPublica calculated his so-called true tax rate at 0.98%.

Still, Bezos said he is open to a policy debate about what constitutes a fair tax burden for the wealthy. The top 1% of taxpayers accounted for nearly 21% of total adjusted gross income in 2023, but paid roughly 38% of all federal income taxes that year.

“We can argue about what the fair share is. That’s a policy debate, that’s okay,” Bezos said. “But the vilification is the thing that’s just the distraction.”

But even fixing tax loopholes or increasing taxes on the wealthy would not address what Bezos sees as a larger government spending problem. He pointed to inefficiencies in New York City’s public school system as an example. 

“If we ran Amazon the way New York City runs their school system, your packages would take six weeks to arrive. We’d have to charge you a $100 delivery fee. And then when the package did finally arrive, it’d have the wrong item in it anyway.

“You could double the taxes I pay, and it’s not gonna help that teacher in Queens. I promise you,” he added.

New York City Mayor Zohran Mamdani pushed back on X, writing: “I know a few teachers in Queens who would beg to differ.”

Bezos plans to give away ‘most of his wealth’ in his lifetime—but his ex-wife MacKenzie Scott already has a head start

While Bezos has not signed the Giving Pledge—the philanthropic initiative created by Warren Buffett, Bill Gates, and Melinda French Gates encouraging billionaires to give away a majority of their fortunes in their lifetime or wills—the Amazon founder said he’s committed to giving away most of his wealth in his lifetime.

At the same time, he acknowledged the challenge of doing philanthropy effectively, echoing comments from billionaires including Buffett and Elon Musk, who have said giving away massive sums of money well is often harder than it appears.

But Bezos’s ex-wife, MacKenzie Scott, already has a sizable head start. Since 2020, she has donated more than $26 billion to organizations focused on DEI, education, and disaster recovery. Meanwhile, Forbes estimates Bezos and his current wife, Lauren Sánchez Bezos, have donated roughly $4.7 billion over their lifetimes. 

Bezos argued to CNBC the long-term societal impact of companies like Amazon and Blue Origin may ultimately prove even more valuable than philanthropy alone. Creating products and services that improve people’s lives, he said, is the kind of impact aspiring entrepreneurs should prioritize.

“Everybody out there who’s a potential entrepreneur make sure you focus on that,” Bezos said. “You will be creating value for society if you’re successful at pleasing your customers.”

A version of this story originally published on Fortune.com on May 21, 2026.

More on wealth inequality:

• With a $15 billion net worth, Palantir CEO Alex Karp predicts he will get 20x richer from AI—but that middle-class workers will get just modest raises
• 1 in 5 Americans thinks it’s ‘morally wrong’ to be a billionaire—Gen Z in particular finds it distasteful
• Justin Trudeau warns AI boom could create hundreds of trillionaires—and it will mean there’s something ‘fundamentally wrong with the world’

This story was originally featured on Fortune.com

The U.S. national debt crossed $40 trillion on Aug. 18, a record high and a milestone that sounds abstract until you convert it into something more familiar: your loan payments.

New economic modeling from The CEO Center, the public policy arm of The Conference Board, puts a dollar figure on what rising federal borrowing actually costs ordinary Americans — a student paying off loans, a family saving for a house, a small business owner expanding, and a retiree counting on Social Security.

The answer, in short: the gap between a responsible deficit path and a reckless one is worth tens of thousands of dollars over a decade, and jumps to six figures in a true fiscal crisis.

The mechanism is simple, even if the debt figures aren’t

Divide $40 trillion by the U.S. population and every American is on the hook for roughly $117,000. But that number doesn’t explain why it matters to someone who will never personally owe the Treasury a cent.

Here’s the actual chain of cause and effect: when the federal government runs a bigger deficit, it sells more bonds to cover the gap. Investors, wary of a less creditworthy borrower, demand higher interest rates on those bonds. Because student loans, mortgages, and small-business loans are all priced off the same benchmark — the 10-year Treasury yield — those higher government borrowing costs flow directly into the interest rate on everyone else’s debt too.

The Conference Board modeled five versions of the next decade: a baseline matching current Congressional Budget Office projections (deficits of 6%–7% of GDP), a “good case” where Washington cuts the deficit to 3% of GDP, a “bad case” where it balloons to 9%, a scenario simulating a one-week government default in 2029, and an extreme shock in which interest rates double to 1980s levels.

Under the current baseline, debt as a share of GDP climbs to 154% by 2036. If lawmakers get serious about cutting deficits, it settles at 126%. More reckless spending, however, puts it at 180%.

The student: an extra $20,000 by graduation

Take a high schooler heading to a four-year university in 2028, borrowing $45,000 for undergrad and another $30,000 for a two-year graduate program in 2032. Federal loan rates are pegged to the 10-year Treasury yield plus a fixed margin — 2.05 percentage points for undergraduate loans, 3.6 points for graduate loans — locked in whenever the loan originates.

Under the baseline scenario, that student repays $103,645 over a standard 10-year term. If Congress gets deficits under control, the bill drops to $102,776, saving roughly $870. If deficits worsen instead, it rises to $104,648. A one-week government default in 2029 would push it to $106,495.

But the real gut punch would be the extreme rate-shock scenario, driving total repayment to $123,736 — nearly $20,000 more than the baseline.

The family of four: waiting to buy a house gets more expensive, not less

A family targeting a $600,000 home with a 20% down payment and a 30-year fixed mortgage faces a similar squeeze — and it compounds the longer they wait. Buying in 2031, the gap between the good-case and bad-case scenarios is about $25,000 on total mortgage payments.

Push the purchase to 2036, and rising deficits widen the gap further: the family pays $24,000 more than baseline in the bad-case scenario, and a staggering $200,000 more — a 19.2% premium — if an extreme rate shock hits. The one-week default scenario alone tacks on $45,000 by 2036.

That’s money competing directly against costs already squeezing this household. For example, center-based childcare now averages $15,570 a year, rising 1.5 times faster than inflation, while long-term care for an aging parent can run anywhere from $75,000 a year for a home health aide to over $128,000 for a private nursing home room.

The small-business owner: financing growth costs more when Washington borrows more

A small-business owner planning two expansion loans — $100,000 in 2031, $150,000 in 2036, each priced at the 10-year Treasury yield plus a 2% bank premium — pays $334,747 in total under the baseline.

Deficit reduction saves about $6,300; a bad-case deficit path costs about $6,500 more. A government default adds $20,000. The extreme rate shock is the worst outcome across any case study in the report: $65,000 more than baseline, a 19.5% increase, at a moment when small-business profitability is already falling and gas costs for small businesses are up 31% year over year.

The retiree: no interest rate, just a shrinking check

The fourth case study works differently because there’s no loan to reprice. Instead, it’s about Social Security’s Trust Fund, which the CBO projects will run out of reserves in 2032. By law, once that happens, benefits automatically drop to whatever payroll tax revenue can cover, unless Congress intervenes. A retiree scheduled to receive $2,466 a month in 2032 would instead get $2,293 — a $173 cut — and by 2036 the shortfall widens to $754 a month.

Congress could avoid the cuts by transferring roughly $2.7 trillion from the general fund between 2032 and 2036. But doing so would add directly to the deficit, pushing the country further toward the “bad case” scenario and, by extension, higher costs for the student, the family, and the small-business owner in the other three case studies. There’s no version of this where the bill simply disappears; it just moves to a different balance sheet.

The bottom line

Three of the four Americans in this analysis pay more in interest, because Washington is borrowing more. The fourth pays through a smaller retirement check, because the money to keep it whole would have to come from more of the same borrowing.

The report’s authors argue that reframing the debt this way — not as a distant trillion-dollar abstraction, but as a line item on a 22-year-old’s student loan bill or a 67-year-old’s Social Security deposit — is what’s been missing from the political conversation.

The CEO Center is pushing Congress to establish a bipartisan fiscal commission, overhaul Social Security financing, modernize Medicare payment models, and reform the federal budget process. Whether lawmakers act may determine which of the report’s five debt scenarios — and which version of these four Americans’ bills — actually plays out.

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.

This story was originally featured on Fortune.com

What did Target, Starbucks, and Nike have in common barely a year ago? All three consumer icons had freshly announced new CEOs, which were wrongly greeted with hasty skepticism from analysts. Target’s Michael Fiddelke was scoffed at as an uninspired insider; Nike’s Elliott Hill was underestimated as a nostalgia hire, unable to stem Nike’s loss of market share, while questions abounded over whether Brian Niccol could actually turn around Starbucks amidst pervasive in-store service struggles, despite his sterling record at Chipotle. 

We saw it differently. At the time of their appointments, we vocally and presciently touted all three new CEOs as the right person for the job at the right time, while other analysts rolled their eyes. Unlike the frequent, sometime successful model of the messianic hiring of industry outsiders as turnaround tians, these new CEOs hit the ground running as each had decades of experience in their sectors with glowing track records, priceless relationships, and balanced expertise across marketing, finance, strategy, and operations,.

Furthermore, we were the first to confidently predict the certainty of their success, even knowing that it would take some time to reposition their enterprises and for their new leadership to gain traction. Now the receipts are in, showing striking progress in all three cases, with each already well on their way to cementing their reputations as the architects of some of the most remarkable corporate turnarounds of our era.  

Target – Michael Fiddelke’s stunning results despite widespread initial skepticism 

When Michael Fiddelke, a Target lifer who had risen up the ranks from a lowly intern over two decades ago, was named CEO, cynics sneered that the board had chosen entrenched groupthink over fresh blood. We argued precisely the opposite—that the data overwhelmingly shows internal candidates outperform splashy external saviors, with insider CEOs appointed over the prior year delivering roughly 15% annualized shareholder returns while external hires averaged negative 9%. New brooms sweep clean, but the old broom knows the corners. Furthermore, we argued that Fiddelke was uniquely positioned to build on the many successes of his widely admired predecessor, Brian Cornell, despite simultaneous urgent challenges. 

This week brought resounding vindication. Target’s second-quarter sales jumped 5.3%, digital sales grew nearly 9%, Target raised its full-year outlook for the second consecutive quarter, and the stock soared nearly 5%. Indeed, on a year to date basis, Target stock has soared nearly 60%. 

A year too late, Wall Street seems to be catching on to what we said first: Bank of America declared it a “impressive improvement in sales under new leadership” while remaining somewhat wary; Morgan Stanley credited Fiddelke with “pursuing the right initiatives” as “initial newness and innovation is gaining traction,” which Telsey sees as “a strong signal that the turnaround is working.” 

Behind the numbers is the simple fact that Tar-zhay is getting its verve back, as it is becoming newly cool and trendy again, ranging from buzzy partnerships from Pokémon to LoveShackFancy to Olivia Rodrigo, Isaac Mizrahi as creative director at large. We see this not only through the data, but anecdotally. Even our fashion-forward Assistant Director, Isabella Giansanti, tells us she is now back to shopping at Target and once again an avid fan, after having been disappointed by the brand for years – which we find more compelling as a barometer of where the puck is going in fashion than any data point!  

That turnaround has been the product of savvy decisions from Fiddelke and his impressive leadership team. Not only did Fiddelke have the courage to launch a $2 billion investment program to refresh Target’s stores, boost service quality and improve the in-store experience for customers; Fiddelke also leaned in on building out Target’s underleveraged digital platform, driving record sales growth there alongside high-margin digital advertising revenue growth, with a newly appointed chief AI officer well positioned to continue to build on that progress, including by harnessing partnerships with Google and OpenAI. 

Starbucks – astounding results from Brian Niccol’s investment in frontline workers and stores 

Brian Niccol entered the company at a time when so much of its prior turnaround efforts had fallen short and new item launches fell flat. Previous CEO Howard Schultz was vocal that the chain had lost its way, publicly stating that “The stores require a maniacal focus on the customer experience, through the eyes of a merchant. The answer does not lie in data, but in the stores…focus on being experiential, not transactional”. 

That is exactly the focus Niccol has adopted, as we touted he would at the time he was appointed, but now he is taking it to an even higher level. Relentlessly focused on frontline employees, Niccol unveiled an unprecedently generous incentive compensation program offering industry-leading pay and benefits, re-motivating a highly committed workforce passionate about improving the in-store experience for customers. Indeed, baristas and shift supervisors are now able to earn up to an additional $1,200 a year based on coffeehouse performance, with extended tipping options increasing what hourly partners receive by up to 8%, on top of pay packages valued at more than $30/hr on average plus comprehensive healthcare, stock awards, a paid college degree and flexible leave. Niccol has also committed to fill 90% of leadership roles from within the ranks, providing tangible pathways of career progression for the best frontline employees. 

The results of Niccol’s sustained investments and commitment to his employees have been nothing short of astonishing, bearing out in financial results which have defied Wall Street consensus by miles. Global and U.S. same-store sales surged nearly 8% last quarter, powered by genuine transaction growth of over 4%, not price hikes; operating margins expanded a stunning 430 basis points, and management has raised guidance two quarters in a row and counting. More than 1,000 coffeehouse “uplifts” are complete and ahead of schedule, peak service times have fallen below four minutes, and brand affinity has reached five-year highs—led, remarkably, by Gen Z. 

Morgan Stanley called these results “impressive in any industry backdrop”; and indeed, Niccol declared in January that “Starbucks is back”, with Wall Street analysts now rushing to upgrade the company, declaring how “impressed” they are with “management’s turnaround efforts that appear to have successfully repositioned Starbucks for sustainable multi-year growth” with the stock up 25% year to date, and counting. 

Nike – green shoots of progress under Elliott Hill 

Of these three remarkable turnarounds, Nike is in the earliest chapter. Critics point out that the stock is down 45% in the last 12 months and 78% from its 2021 peak, hitting a 12-year low, but what they miss are that the green shoots of progress are already visible. A closer look is warranted at what is happening underneath the surface at Nike, despite widespread cynicism and skepticism. 

Elliott Hill, the 32-year Nike veteran who came out of retirement to turn around the company, inherited an unenviable hand, after the unforced errors of his predecessors in cutting off vital wholesale distribution partners in a botched direct-to-consumer pivot, whose failures led to massive discounting, lack of innovation, and a self-reinforcing negative feedback cycle as Nike bled market share to upstart rivals like On and Hoka. 

Rather than hiding from the toughest challenges, Hill confronted them head-on despite knowingly taking on some short-term pain and cost. Hill started by rebuilding damaged wholesale partnerships, resulting in wholesale revenues in North America jumping 10% this quarter with the most important wholesale partners posting positive growth for the first time in four years. Similarly, Hill launched a program of deliberate strategic surgery after excessive discounting, initiating some store closures, a significant scaling back of certain lifestyle products, in particular three specific massive sportswear franchises across AF1, Dunks, and Air Jordan’s which were previously over-relined on, and a painful but important China reset, prioritizing brand & margin integrity over volume.

And most important of all, Hill’s return as CEO marked a return to Nike’s cultural core in celebrating elite performance across sports and running, with the core running category posting double-digit growth for every quarter under Hill’s watch, adding roughly $1 billion in revenue and 5% of global market share, and soccer momentum surging on the heels of successful World Cup partnerships. Indeed, Nike’s World Cup campaign drew 1.5 billion views in its first week, national-team kit sales more than doubled, and the Mercurial became the fastest-selling boot launch in Nike Direct history. No wonder that Wall Street analysts are now back to declaring that the question on Nike’s turn is no longer “if,” but “when.”

The emerging turnaround playbook for CEOs in 2026 

The common threads across these three revivals carry lessons that transcend the consumer sector alone. 

First, boards chose CEOs who know the business cold with loads of front-line and operational expertise —Elliott Hill at Nike and Michael Fiddelke at Target are decades-long insiders who practically grew up in their companies; while Brian Niccol is a proven brand-builder with a track record of prioritizing the customer experience—rather than celebrity saviors armed with slide decks detached from frontline experience. All three CEOs are personally lowkey and would rather shine a spotlight on their employees and their customers rather than themselves. 

Second, each of these three CEOs has prioritized investing in the core customer experience—whether boosting barista pay at Starbucks to unprecedented levels; making Target cool again by investing $2 billion in stores; or returning Nike to its elite sports and running performance roots. All three CEOs understood implicitly that prior alienation of primary points of customer contact are more destructive than any mere marketing campaign can fix. 

Third, each of these CEOs has focused on fixing operations rather than reaching for the tired but easier playbook of financial engineering, buybacks, and cost-cutting into oblivion. There were no shortcuts here: all three CEOs have committed to genuinely turning around the operational performance of their companies, investing for the long-term while understanding that stock multiples and re-ratings will follow if they get operations fixed first. 

And fourth, each moved fast, front-loading the painful medicine of store closures, marketplace cleanups, and resetting Wall Street expectations immediately upon taking over, rather than kicking the can down the road, letting problems fester. 

A century of business history—from IBM under Gerstner to Apple under Jobs to Microsoft under Nadella—teaches that iconic institutions can be reborn when leaders restore pride, purpose, and product; and Target’s Michael Fiddelke, Starbucks’ Brian Niccol, and Nike’s Elliott Hill are now writing the newest entries in the canon of successful turnarounds of iconic American brands, as all three are already well on their way to cementing their reputations as the architects of some of the most remarkable corporate turnarounds of our era.  

The old adage that “new brooms sweep clean” wrong seems to favor outsider newcomers but, in fact the second verse of this Rastafarian proverb is that “But old brooms know the corners.”  The success unfolding at Target, Starbucks, and Nike shows that wisdom, humility, hard work, and imagination can payoff when the boards are patient. 

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

This story was originally featured on Fortune.com

Most job interviews last around 45 minutes. Bupa CEO Iñaki Ereño thinks that’s nowhere near enough time to know if someone is actually worth hiring—so he puts candidates through six hours of tests across three separate meetings instead, including a restaurant sit-down where he’s watching whether you’ll order wine.

“I tend not to like people that don’t have any initiative,” Ereño told Fortune. “Imagine if my drink is a glass of water. I’m very happy with someone who says, ‘Do you mind if I have a glass of wine?’”

In fact, the Fortune 500 Europe boss said he’d prefer for a candidate walking into the lunch interview, seeing his glass of water and ordering the same. 

“I don’t like followers, ‘oh I will have a glass of water as well, I don’t want wine.’ These sorts of things are very important,” Ereño said, adding he is specifically testing how confident you are. That kind of energy is exactly what separates leaders from the crowd.

“Be more proactive, less passive. Take some risks, take initiatives,” is Ereño’s advice on making it to the top. And ordering wine even when the boss hasn’t is exactly that—showing bold initiative.

It’s just one part of his ‘secret weapon’ test: three meetings, two hours each

Ereño runs one of Europe’s largest healthcare companies: Bupa, which reported £18.2 billion ($24.5 billion) in revenue in 2025, a giant spanning 190 countries and employing over 100,000 people. Getting a senior hire wrong at that scale is expensive—something he’s learned the hard way. Now, watching your drinks order is just one of his tests.

“When I was doing an interview of just one hour, that was not enough,” he said. “I reduced my level of mistakes when hiring people by setting up a system that is based on three meetings, two hours each. That’s my secret weapon.”

The first is a classic two-hour deep dive into the CV. The second moves to a restaurant for breakfast or lunch—and that’s where the real assessment begins. And it’s not just your drink order he’s looking at. 

“How you treat the waiter, for me, is an obsession,” Ereño said. “I want to see how nice you are. You need to be respectful.” He’s watching body language, confidence, how you hold yourself when the formal setting drops.

The third meeting is back in the office, where the questions get more personal. 

“And then there is another two hours after that,” he added. “Asking about your life: What do you like? What do you see in our company? What are you expecting from Bupa? All of those questions.”

From Steve Jobs to Steven Bartlett, he’s not the only CEO with an unusual test up his sleeve 

Ereño is far from the only CEO who thinks the restaurant table reveals more about a future hire than a cold interview room.

$31 billion Twilio CEO Khozema Shipchandler interviews senior candidates specifically for 45-minute dinners—he’s watching how they carry themselves off the clock while also listening for one word in particular. Say “I” too much and it signals you’re not a team player. 

Khozema also sets aside around 20 minutes for the interviewee to ask questions. If they have nothing up their sleeve? “That’s a pretty big red flag.”

One CEO won’t hire anyone who salts their food before tasting it. Another secretly asks the server to mess up the candidate’s order mid-meal just to see how they react.

Apple’s Steve Jobs had a “beer test.” But instead of actually doing the interview in a restaurant or bar, he’d take candidates on an informal walk-and-talk to find out what they’re like off-duty. He’d then ask himself: “Would I have a beer with this person? Would I talk to him or her in a relaxed way while taking a walk?” If the answer was no, they weren’t hired.

And even if you’re not meeting a potential boss in a restaurant surrounded by waiters, it still pays to be nice to the staff you meet on your way to your interview—wherever it is.

Diary of a CEO founder Steven Bartlett hired someone with “zero” experience because she thanked the security guard by name on her way into the building. Six months later, he called her one of the best hires he’d ever made.

Are you a CEO with an unusual hiring test? Fortune wants to hear from you: Orianna.Royle@fortune.com

A version of this story originally published on Fortune.com on July 3, 2026

Read more on acing the job interview from Fortune’s Orianna Rosa Royle:

• Red flag test: former CEO explains why he rejects job candidates who say they can start right away
• For every 10 jobs, there are 2,539 applicants. A top hiring platform’s CEO has a solution to the job hunt hell: ‘Don’t just apply to OpenAI’
• Bridgewater Associates ex-recruitment boss reveals the secret ‘unpopularity’ interview test he used on hundreds of candidates at the hedge fund
• $5 billion CEO calls the managers that candidates didn’t list as references—and he’ll even ask coworkers they clashed with what they really think
• Steve Jobs used a ‘beer test’ for interviews at Apple—if he didn’t want to drink with you, you didn’t get the job

This story was originally featured on Fortune.com

With U.S. debt hitting $40 trillion, markets are turning more attention to that burden and whether policymakers will address the root causes or just the symptoms.

The Treasury Department’s interventions in the bond and currency markets in recent weeks point to the latter.

Treasury Secretary Scott Bessent surprised Wall Street on Wednesday with a plan to increase buybacks of long-term bonds, after the 30-year yield hit the highest level in nearly 20 years.

That came just a few weeks after the U.S. and Japan took such joint action to boost the yen for the first time in three decades. But to make it happen, the U.S. sold euros instead of dollar-denominated assets, avoiding a sale of Treasury securities that would put more upward pressure on yields.

Japan also refrained from selling Treasuries and instead tapped an obscure Federal Reserve tool called the Foreign and International Monetary Authorities Repo Facility (FIMA). This mechanism allowed Japan, which is the world’s largest holder of U.S. debt, to borrow dollars against its Treasury stockpile, obtaining a limited form of liquidity. 

According to George Saravelos, head of FX research at Deutsche Bank, “we see both the buyback and encouragement to use the FIMA facility for FX reserves as soft-form financial repression policies aimed at containing the long-end of the US yield curve.”

Financial repression generally refers to policies that enable a government to keep interest rates artificially low by influencing financial markets.

Countries throughout history have practiced it, especially during times of high indebtedness. In fact, the U.S. and other developed economies used financial repression to slash their debt-to-GDP ratios after World War II.

Indeed, conflict and calamities are major factors in financial repression. A recent survey of 300 years of U.S. and U.K. history found that wars are “always disaster times” for holders of government debt because of inflation and financial repression.

It’s not good for currencies either. Saravelos warned that suppressing U.S. Treasury yields will merely shift the impact to the dollar.

“If the market price of USTs is not ‘allowed’ to adjust down, the foreign exchange price of UST owned by foreign investors has to adjust via a weakening in the dollar,” he explained.

Markets will next scrutinize how the Federal Reserve responds, Saravelos predicted, pointing out that Bessent’s moves to effectively loosen financial conditions would typically prompt the Fed to offset that with tightening measures.

That’s as the Fed has been especially wary of inflation, which has exceeded its 2% target for more than five years, with several central bankers ready to hike rates. But Chairman Kevin Warsh has refrained from so-called forward guidance, leaving Wall Street guessing on his stance.

“If Chair Warsh does not recognize the buyback as a factor driving an easing of financial conditions, we would take it as an additional dollar negative driver,” Saravelos added. “In all, the market is likely to be increasingly attentive to further measures intended to support the US Treasury market going forward. The more these are perceived as distortionary to market pricing, the more the dollar is likely to weaken.”

Since the debt buyback was unveiled, markets have ramped up bets on the “debasement trade,” with prices for gold and bitcoin surging on expectations of further dollar devaluation.

That’s because the root causes of the recent jump in bond yields—especially massive debt and deficits—are not priorities among most lawmakers.

The federal budget deficit is on track to hit $2 trillion this fiscal year, and debt interest costs alone are already $1 trillion annually, taking up a bigger and bigger share of spending. But there’s no sign Washington is serious about slashing the budget or raising taxes.

Absent such moves, the solution to higher borrowing costs is likely more repression. A research paper last month from the International Monetary Fund said the world is ripe for another wave.

“With the conditions historically associated with elevated repression present today, our evidence suggests that financial repression may see increased use going forward,” it said.

This story was originally featured on Fortune.com

An out-of-control wildfire that jumped over fire trucks and made it difficult for crews to reach hot spots destroyed homes in northwest Reno, Nevada, on Sunday. Shifting winds challenged firefighters trying to bring it under control, and authorities urged some 90,000 people to evacuate.

At least six people — three first responders and three civilians — were injured. Officials said the fire was “human-caused” but did not provide details on how they reached that conclusion, or whether it was intentionally set or accidental.

The Hawk Fire began Saturday and grew to more than 23 square miles (60 sq. km.) as it spread Sunday across the Peavine Peak area of the Humboldt–Toiyabe National Forest, where rugged foothills are ringed by homes and businesses near the California state line. There was zero containment.

Some 42,000 residents have been ordered evacuated as the “GO NOW” zone expanded, reaching the edge of the University of Nevada. An additional 45,000 people were in the adjacent evacuation warning zone. Authorities urged people to be prepared to stay away for several days, because shifting and strengthening winds were expected to make the fire even more unpredictable.

“Please get out if you can right now,” Washoe County Sheriff Darin Balaam said.

A Sunday evening update said crews observed “extreme fire behavior” as gusts pushed flames through dry brush.

“Over the next 12 hours, the fire is expected to continue to make moderate to high intensity runs in pockets of dense fuels,” the statement said.

A family raced to grab possessions but lost their home

It wasn’t known how many homes were destroyed. Cari Kieffer said a video posted on social media showed her house entirely burned down, with only a scorched basketball hoop still standing.

“I woke up this morning and just started crying — all my kids, they lost everything,” Kieffer said Sunday. “We lost all our stuff. Everything we own is gone.”

Kieffer had been watching her son’s football game Saturday when she learned that their home on the outskirts of Reno was in the evacuation zone. An app the family used to track the fire’s progress had been lagging significantly behind its actual location, she said, so they thought firefighters had kept the blaze from their neighborhood.

Instead, Kieffer, her husband and their four children ages 3 to 16 raced to save their dogs and whatever possessions they could retrieve. Ash rained down, and the wind blew like an oven blast from a wall of flames advancing down the hillside toward their neighborhood, she said.

“I kept looking outside and the flames just kept getting closer and closer every time I looked,” Kieffer said. “I was like, we gotta go like now.”

Eyes watering and throat burning, Kieffer grabbed a handful of clothes, a Bible, her wedding photos and her mother’s ashes. In the frenzy, as firefighters yelled at her family to leave immediately, she said she forgot her family’s birth certificates and was unable to salvage her childhood photos.

The family drove to a friend’s home but had to evacuate again. They learned later Saturday evening that their own home was gone.

Governor declares state of emergency and mobilizes National Guard

Nevada Gov. Joe Lombardo declared a state of emergency in Washoe County and mobilized the Nevada National Guard to support aerial firefighting with two helicopter crews as well as 60 troops to help police safeguard evacuated neighborhoods. Also responding were 800 fire personnel.

Nearly 10,000 customers were without power in Washoe County on Sunday, down from 60,000 on Saturday. Portions of U.S. Route 395, a major north-south highway, were closed due to the fire. Reno, with more than 280,000 residents, is the largest city in Nevada outside of metro Las Vegas.

Washoe County emergency officials opened the Reno-Sparks Convention Center to evacuees, but said they couldn’t bring their pets — small animals and large animals were to be left at two other locations. Casinos in Reno offered discounts on hotel rooms to evacuees.

The fire turned destructive fast

The fire was so small Saturday morning that it wasn’t even a concern, said Tyler Duvall, who went camping over the weekend. By the next day, his house was in the evacuation zone.

“The wind really blew it up,” Duvall said.

On Saturday alone, 15 new fires popped up across Nevada. Months of dry weather and a record lack of snow this past winter across the American West have created prime fire conditions. Earlier this month, wildfires in eastern Washington state forced the evacuation of 60,000 people in the Spokane area, while three wildfires north of Reno forced more than 13,000 residents from their homes.

A mountaintop home goes up in flames

Jaida Hargrove’s grandfather, Rick Arrate, lived alone on Peavine Mountain, which overlooks Reno and Sparks. Firefighters used a bulldozer, cut down trees and applied fire retardant in their attempt to contain the flames, Hargrove said.

“They all thought it would be OK,” she said. “And then, in about 30 minutes, the winds just changed and it came way too fast.”

Arrate and the firefighters were quickly forced off the mountain. “All he was able to take with him was his two golden retrievers,” Hargrove said.

Arrate spent Saturday night with Hargrove’s parents, his next steps unknown.

Separate GoFundMe crowdfunding campaigns were set up to assist Arrate and the Kieffer family.

A Nevada transplant gets a rude welcome to Reno

Retired police officer and firefighter Ted Melden has seen his share of Mother Nature’s fury since moving to Reno with his wife earlier this month from Chapin, South Carolina. So far, he has experienced a hailstorm with flash flooding, two different power outages and, now, the second wildfire incident in the region in two weeks.

“Just another natural disaster,” Melden said.

In the two years he lived in South Carolina, Melden said Hurricane Helene knocked over trees in his yard, while a tornado did some damage in his neighborhood.

For now, Melden hasn’t been ordered to leave his home, but he has his bags packed just in case.

“You just have to roll with the flow and be ready,” he said.

David Barb returned from a weekend hunting trip to find the fire had leveled his taxidermy shop, but his house nearby appeared to have been spared thanks to workers with a landscaping company who cut a fire break, he said. His wife was home when the fire started on the other side of the mountain and later evacuated to a friend’s house.

“I’m kind of devastated, but thank God everyone’s safe,” he said Sunday.

Residents just outside the evacuation zone are keeping watch

The University of Nevada, where many of the 20,000 undergraduates moved into their housing this weekend, was just outside the evacuation zone Sunday.

Two hospitals evacuated patients and the sheriff said his office was keeping a close watch on whether to evacuate the county jail.

The fire moved exceptionally fast Saturday night, jumping over fire trucks and making it difficult for responders to get to hot spots while residents were trying to get out, the sheriff said.

“It was extremely confusing,” Balaam said, describing how changing winds sent the flames in different directions.

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Raby reported from Charleston, West Virginia, Brook from New Orleans and Seewer from Toledo, Ohio.

This story was originally featured on Fortune.com

What happens when large language models become commodities? Competitive advantage moves from the model itself to the balance sheet behind it. AI is now reversing 20 years of technology economics, turning what was once a software business into a capital-intensive industry.

For much of the past two decades, investors rewarded asset-light software companies that needed little capital and generated fat margins. Today, however, those same companies are spending at a scale the tech sector has never seen.

Since the AI boom began in 2023, Amazon, Microsoft, Alphabet and Meta have together poured $1.1 trillion into AI infrastructure. The four “hyperscalers” plan to invest another $745 billion this year alone. Capital intensity is, clearly, no longer something Big Tech can avoid. It has in fact become the cost of competing in the AI race.

But there is a far bigger shift under way: as AI models become increasingly interchangeable, competitive advantage will depend less on the models themselves than on who can finance, build and run the infrastructure behind them the most cheaply.

Which also helps to explain why Microsoft boss Satya Nadella said recently that “every model is substitutable” and Amazon chief Andy Jassy predicted that there will soon be “at least half a dozen” comparably good AI models.

That changes the basis of competition itself. Rather than betting the house on a single winning model, the hyperscalers are building more of the infrastructure capable of supporting many of them. And as that happens, financing and scale begin to matter more than owning the frontier model itself.

Yet one question still hangs over the investment cycle: whether the models themselves ultimately generate enough value to justify the trillions still being committed. The answer remains uncertain. Both OpenAI and Anthropic remain lossmaking today. Yet the flow of capital has anything but slowed.

Chipmaker Nvidia for instance, is now working with Apollo, Blackstone, Goldman Sachs and other Wall Street giants to mobilize more than $500 billion of additional capital for AI infrastructure.

And Google has gone even further. Rather than simply writing cheques, it has assembled a $200 billion financing structure with Broadcom, Apollo, Blackstone and Morgan Stanley to fund Anthropic’s chips and data centers. Which just underlines how the locus of competition has expanded into finance itself.

The tech giants already hold the strongest hand. Microsoft, Amazon and Google have the balance sheets, the cheapest capital and are generating huge revenues from the same data centers they use to train AI models. Those advantages should endure even if AI models themselves become interchangeable.

Big Tech is unlikely to have the field to itself, however. SpaceX could emerge as a serious competitor, while sovereign wealth funds such as Saudi Arabia’s PIF and Abu Dhabi’s MGX combine cheap capital, abundant power and the flexibility to work with both western and Chinese AI companies.

Regardless of who ultimately wins, the money is already moving. Cloud providers are capturing the first commercial returns, with chipmakers selling the picks and shovels and Wall Street financing the build-out. Not everyone benefits, of course. Enterprise software companies are no longer just competing with one another, but with AI infrastructure for the same corporate budgets.

IBM’s second-quarter results brought that shift into sharp relief. Customers postponed software purchases as they rushed to secure AI infrastructure ahead of expected price hikes. The result: a 25% one-day collapse in IBM’s share price in mid-July.

That shift has understandably unsettled investors. For much of the past year, Big Tech shares have been whipsawed by a key question: will the AI spending boom ever generate a decent return? The sheer scale of that splurge has already weighed heavily on free cash flow. Alphabet’s spending has pushed free cash flow into negative territory for the first time since its IPO. Meta’s free cash flow also fell sharply in the latest quarter.

However, the latest Big Tech earnings showed the investment cycle is now delivering a return in cloud computing, even as capital spending continues to soar. Overcapacity in AI infrastructure may eventually appear, but the results season shows that moment is still a long way off.

Indeed, Microsoft’s cloud business grew 32% to $39.3 billion in the latest quarter, helping drive an 18% increase in revenues. Amazon Web Services grew 37% to $42.2 billion, its fastest growth in more than four years. And Google’s cloud business surged 82% to $24.8 billion. Investors duly rewarded Microsoft’s results by adding a record $450 billion to its market value in a single day.

Yet the market has not reached a verdict, and Apple is the exception that proves the rule. While its rivals have poured hundreds of billions into AI infrastructure, it held back, and investors briefly rewarded that restraint with a $5 trillion valuation last month. The iPhone maker has therefore become the market’s control group.

Investors are now placing two very different bets: one backs companies willing to spend whatever it takes to build AI infrastructure; the other backs those that refuse to sacrifice financial discipline in the process. One side will be proved right, and one wrong.

But whichever side wins, the rules of competition have already changed. As AI models converge in capability, the companies with the strongest balance sheets, the cheapest capital and the highest utilization of their infrastructure will have the edge. AI is, in effect, becoming a financial engineering business. 

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

This story was originally featured on Fortune.com

Enrollment in the biggest federally funded food aid program in the U.S. dropped by more than 13% in a 12-month span — a decline far steeper than the government estimated as work requirements and other provisions of President Donald Trump’s “big beautiful bill” take hold.

Those losing coverage in the Supplemental Nutrition Assistance Program, or SNAP, include people who don’t meet the tightening requirements to participate, and, advocates say, some who qualify for the help but are rejected because they miss deadlines or don’t have the needed documentation handy. It’s too early to tell exactly how many fall into each group.

It’s also unclear how many have lost coverage because some state agencies that run the programs are overwhelmed trying to keep up with changes. That was the case in Arizona, which saw the nation’s largest enrollment drop.

Tia Fields, who analyzes social safety net policies at the advocacy group Invest in Louisiana, said the main reason she’s seeing people lose coverage is not failure to meet work requirements. “A lot of it is administrative paperwork,” she said.

Proponents of welfare reform hope the roll reductions are driven by people earning too much to keep qualifying — a sign that policy changes are behaving as intended for a program they assert is riddled with fraud.

“If there are people that are leaving the welfare rolls because they’re working and they’re moving forward,” said Rachel Sheffield, a research fellow at the conservative Heritage Foundation, which pushed for stricter requirements for SNAP, “that would be a step forward.”

Arizona has had the steepest decline so far, with a 12-month drop of more than 50%, according to data compiled by the U.S. Department of Agriculture, which runs SNAP. The decline was more than 20% in Georgia, Louisiana and Nevada — and in Florida, where the Department of Children and Families said in a statement that the decreasing number “is reflective of the state’s strong focus on advancing opportunities for Floridians and their families to achieve economic self-sufficiency.”

Eligibility requirements are tightening

SNAP helps more than 1 in 10 people in the U.S. buy food. Most of the beneficiaries have incomes below the poverty line. The monthly benefit, which is delivered on debit cards that can be used only for groceries, is $344 per household on average.

Newly released federal data found SNAP enrollment fell from 42.2 million in May 2025 to 36.6 million in May, a drop of more than 13% in a year. The May data are preliminary and could be revised.

Since 2010, the average number of monthly beneficiaries has been below 40 million for only two years — 2019 and 2020. The rolls started dropping after a recent peak of 43.3 million in October 2024. They’ve fallen much faster since implementation began last year for Trump’s “one big beautiful bill,” which cut taxes and overhauled social safety net programs.

The expanded SNAP work requirement has now kicked in for most of the country, but it won’t begin in some places until next year.

Many adults 54 and younger without minor children have long been required to work to get SNAP benefits. The new law requires most people who previously had been exempt from requirements to either work, volunteer or go to school to get benefits. It now includes those ages 55 to 64, and those with children ages 14 to 17. Those 65 and older or with children younger than 14 remain exempt, as do those with health limitations. Some other groups that had been exempted from the requirement — including homeless people — no longer are.

In February, the Congressional Budget Office projected that the new requirements and other factors would push SNAP enrollment down over the next decade, falling below 34 million by 2036. But the nonpartisan office did not expect the drop to be as fast as it’s been. By May, the number of people receiving the benefits was about as low as it was forecast to go in 2030.

Experts expect another impact when states are required to pay part of the cost of benefits if their rate of payment errors — when recipients receive more or less than they should — is above 6%. Advocates for recipients say states may deny benefits to some people entirely rather than risk errors.

The cost-sharing is scheduled to start in October 2027, though Congress has considered a delay.

Changes have been hard to implement in Arizona

In Arizona, enrollment plummeted by 55% from April 2025 to April 2026 — the biggest drop in the country, with more than 400,000 fewer people getting benefits now.

The state said the drop was driven largely by the state’s own struggles putting new federal requirements in place.

“Implementing the federally mandated changes triggered unprecedented call volumes and administrative hurdles, including additional verification requirements, creating real barriers for applicants,” said Brett Bezio, a spokesman for the Arizona Department of Economic Security.

Bezio said that hiring more staff members and introducing ways for people to submit their documents online have stemmed the enrollment drop in recent months as the state has reduced the chance for people who qualify to lose benefits.

In Phoenix, LaDiamond Lopez lost her benefits in January, with officials telling her she needed more documentation about her income and household — something that’s needed for officials to determine whether enrollees meet work requirements.

She’s been skipping meals and some bill payments to ensure her children have enough to eat.

In her quest to be reinstated, she had previous employers sign forms confirming she no longer worked for them and added her children — ages 3 and 9 — to her apartment lease. She expected payments to resume in August, but she doesn’t know if they’ll last.

“I was approved at the end of May, but now they’re asking me for more documents,” she said. “It’s a panic.”

Other factors could be driving down enrollment

The Heritage Foundation’s Sheffield says that some of the drop in SNAP use is likely a natural decline after peaks in the coronavirus pandemic era.

Paco Velez, the president and CEO of Feeding South Florida, said the 22% one-year enrollment drop in Florida is driven partly by immigrants who are in the U.S. legally but fear being targeted by Trump’s immigration crackdown if they’re seeking government benefits.

Invest in Louisiana’s Fields said SNAP enrollment declines have broader consequences. For instance, children in households that receive the benefit can be automatically enrolled in free school lunch programs or in the SNAP for Women, Infants and Children program for low-income mothers, young children and expectant parents if they meet the other criteria.

“What happens when that child can’t pay for lunch?” she asked.

Some food banks have ramped up donations to try to meet a demand that they say has risen as SNAP rolls have declined. But that isn’t expected to bridge the gap fully.

“We’re very worried about it because we know that no other organization or program can replicate the scale and success of SNAP,” said Carolyn Vega, a policy analyst at the advocacy group Share Our Strength. “We know that schools can’t fill this gap. We know that food banks can’t fill this gap.”

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Schuettler is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

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Mulvihill reported from Haddonfield, New Jersey.

This story was originally featured on Fortune.com

Iran warned that U.S. sanctions set to be announced Monday would not bring peace to the region. Meanwhile, Israeli and Syrian officials met less than a week after Israeli strikes in Syria. And Israel said it killed a Hamas commander in Gaza.

Here’s a look at the latest developments in the Iran war and the wider Middle East on Monday. Full coverage can be found here.

Iran threatens response ahead of US sanctions announcement

Iran’s Foreign Ministry spokesperson warned that Tehran would respond harshly to expanded U.S. sanctions, including measures against countries it sees as cooperating with Washington.

“Any escalation of this situation will undoubtedly bring about consequences,” Esmail Baghaei said. “Our hands are not tied.” The new head of Iran’s top security body warned Sunday that Tehran will see any country’s support for the sanctions as an “act of war.”

The expanded sanctions come after weeks of impasse. The United States has not dislodged Iran’s grip on the Strait of Hormuz, through which a fifth of the world’s traded oil passed before the war started nearly six months ago.

Iran’s demands for reopening the strait include lifting the U.S. naval blockade, withdrawing U.S. forces from the region and reparations for damages sustained in the war. It has held separate talks with Oman, on the other side of the strait, on jointly managing the waterway regardless of whether a new deal is brokered with the U.S.

Sanctions have historically raised prices of basic goods in Iran, but after decades of withstanding them, Iran’s economy has adapted through finding new trading partners and building domestic industries.

Ahead of the expected U.S. announcement, the country’s currency hit a record low on Monday.

Israeli and Syrian officials meet following an Israeli airstrike

Syrian Foreign Minister Asaad al-Shibani met over the weekend with a high-level Israeli delegation in Jordan to try to defuse tensions after Israel last week struck an air base in northern Syria, Syrian state news agency SANA reported.

The U.S.-mediated discussions on Sunday focused on restarting negotiations for a future security agreement, SANA said.

Israel struck the Abu Duhur air base in Idlib province, saying it aimed to stop Turkey — which has supported the new Syrian government’s efforts to rebuild its armed forces after 14 years of civil war — from establishing a presence there.

Syrian officials during the talks asserted the right to develop an army and freely forge alliances with any country, SANA said.

They also called for the withdrawal of Israeli forces from a buffer zone in southern Syria they have occupied since December 2024, and reiterated Syria’s stance that the Golan Heights — which Israel captured in the 1967 Mideast war and later annexed — is Syrian territory.

Israeli officials didn’t immediately comment on the meeting.

Israel says it killed another Hamas militant

Israel’s military said it killed a militant affiliated with Hamas’ special forces unit in an overnight airstrike, the latest targeted killing announced since U.S. officials met with Prime Minister Benjamin Netanyahu last week hoping to push last year’s ceasefire deal forward.

Israel says it targets and kills Palestinian militants it says participated in the Oct. 7, 2023, attack that sparked the war.

Israel has announced targeted strikes on six of the seven days since U.S. negotiator Jared Kushner’s meeting with Netanyahu.

At least 1,288 Palestinians have been killed since the ceasefire took effect last October, according to Gaza’s health ministry, part of the Hamas-run government. Its numbers are generally considered reliable by the international community.

Palestinian American says he can’t freely leave West Bank home

The Palestinian American homeowner whose residence was besieged this month by Israeli settlers said he remained unable to move freely in the village of Qusra in the occupied West Bank. Loui Ridi traveled from Ohio to join his relatives defending his home a week ago.

The Israeli military declared the area a closed zone to restore order in Qusra. Ridi said settlers returned throughout the week to the hill above his house.

Since Israeli settlers surrounded the house more than two weeks ago, preventing occupants from leaving, Israeli soldiers have encouraged them to leave but Israel’s police have not announced arrests.

The siege and Israel’s response have sparked condemnation from Israeli rights groups and foreign officials, including U.S. Ambassador to Israel Mike Huckabee, who called the violence terrorism.

Palestinians consider the West Bank, home to some 3 million Palestinians and 560,000 Israeli settlers, the heart of any future state and have condemned Israel’s expansion there. This year has seen a dramatic spike in violence carried out by Israeli settlers against Palestinians.

This story was originally featured on Fortune.com

U.S. forces have struck another vessel in the eastern Pacific, killing two people the Pentagon says were trafficking drugs.

The U.S. Southern Command announced the strike in a social media post early Monday. The death toll from the Trump administration’s campaign of bombing boats off Latin America’s Caribbean coast and in the eastern Pacific now exceeds 210 after more than 60 strikes.

The Joint Task Force Western Hemisphere “executed a lethal kinetic strike on a low-profile vessel operating along established narco-trafficking routes in the Eastern Pacific.” Intelligence confirmed the vessel was carrying illegal drugs, the statement said.

“We are committed to imposing total systemic friction on narco-terrorists — disrupting their operations, dismantling their leadership, and eliminating cartel terror across the region,” said Gen. Francis Donovan, who leads U.S. Southern Command.

The latest strike comes days after Defense Secretary Pete Hegseth announced that the U.S. would extend its offensive to land across multiple Latin American countries. The secretary said during a visit to Panama that Colombia, Guatemala and Honduras had agreed to allow the U.S. to carry out joint military operations against criminal groups on their soil. Guatemala denied reaching such an agreement.

Ecuador launched similar missions with the U.S. in March.

This story was originally featured on Fortune.com

Google’s $10 million purchase of a vast archive of Spirit Airlines’ internal data—which includes employee emails—has run into opposition from flight attendants, who argue that the privacy protections attached to the deal do not adequately cover sensitive information. The Association of Flight Attendants-CWA, which represents flight attendants nationwide, filed an objection in US Bankruptcy Court for the Southern District of New York challenging the proposed sale of the airline’s digital records to Google.

“The privacy architecture of this transaction is consumer-facing; its payload is disproportionately employee-facing,” the filing states. “Hence, the employee data is far more confidential than the customer data, yet receives far less protection than the customer data.”

Spirit Airlines has been one of America’s best-known low-cost airlines, building business off of affordable flights and charging separately for services. But its collapse has led investors and stakeholders to sell off the company’s remaining assets, which include physical and digital property. 

The dispute creates a wrinkle in Google’s effort to turn the remains of the bankrupt airline into fuel for its AI ambitions. The tech giant won a bankruptcy auction for $10 million, beating AI recruiting company Mercor who offered $7.5 million. The transaction includes roughly 100 million emails and 500 million Microsoft Teams messages—along with spreadsheets, calendars, software code and other internal business records.

Google has disputed the data risk and told Fortune it is currently reviewing the objection filed by the union. The company posits there will be no personal identifying information that is of concern by the AFA-CWA included in the data obtained by Google.

“We acquired part of an enterprise dataset from Spirit Airlines, which can be helpful in improving our products and AI models,” A Google spokesperson told Fortune. “We will not receive any personal information from this dataset.”

The company also said any data that is received through the sale will be de-identified by an unnamed third party before being obtained by the tech corporation.

According to Google’s sale filing, the data protections applied to the auction include consumer data—but doesn’t specifically state employee confidentiality.

“Assets shall not include information that relates to, describes, or is reasonably capable of being associated with a consumer or is otherwise considered ‘personal data’, ‘personal information’, ‘nonpublic personal information’ or other similar term under applicable data protection laws,” the filing read.

Google says it has “no interest” in receiving employee or any individual personal identifying information.

However, the Association of Flight Attendants says Google’s safeguards aren’t enough. In a note published this week, the union said the auction filing “does not address whether the contents of the record are confidential.”

The union also wrote that they have concerns that the Sale Agreement’s “deidentification” might still preserve “referential integrity across the data set”—meaning the transmission of the data could possibly allow the confidential records to be followed.

The organization has also sent challenges to the failed airline itself, arguing the company did not adequately notify employees before shutting down. 

“Spirit Flight Attendants still haven’t been paid their accrued vacation and sick leave, along with other compensation they are due,” AFA-CWA President Sara Nelson told Fortune. “Attempting to now sell their data is adding insult to injury.”

But this doesn’t mean the union is committed to shutting down the sale—or the data transfer. According to its filing, AFA-CWA “does not seek to disrupt the Debtors’ sale process, to unwind the Auction, or to prevent the estates from monetizing data assets.” Instead, it only looks to remove all identifying information that can be traced back to individuals and employees related to the airline.

“The flight attendants’ interest is in confidentiality,” the filing states.

This story was originally featured on Fortune.com

As of 9 a.m. Eastern Time today, oil sold for $94.12 per barrel (using Brent as the benchmark, which we’ll get into momentarily). That’s 54 cents lower than yesterday morning and approximately a $26.21 rise over the past year.

Will oil prices go up?

It’s impossible to predict the future of oil prices. Several factors determine the movement of oil, but it ultimately boils down to supply and demand. Again, when threats of economic downturn, war, etc. are high, the oil trajectory can turn rapidly.

How oil prices translate to gas pump prices

When you pay for gas at the pump, you’re paying for more than just the crude oil itself; you’re also springing for links along the chain, such as the refineries and wholesalers—not to mention taxes and local gas station markups.

Still, the crude oil aspect affects the final price most dramatically, as it typically accounts for more than half the price per gallon. When oil prices spike, so do gas prices. And frustratingly, when oil prices drop, gas prices tend to take their time drifting down to the lower price (sometimes referred to as “rockets and feathers”).

The role of the U.S. Strategic Petroleum Reserve

In case of emergency, the U.S. has a store of crude oil known as the Strategic Petroleum Reserve. Its primary purpose is energy security in case of disaster (think sanctions, severe storm damage, even war). But it can also go a long way toward softening crippling price hikes during supply shocks.

It’s not a long-term answer—more of an immediate relief to assist the consumer and keep critical parts of the economy running, like key industries, emergency services, public transportation, etc.

How oil and natural gas prices are linked

Oil and natural gas are both major energy fuels. A big change in oil prices can affect natural gas by extension. For example, if oil prices increase, some industries may swap natural gas for some segments of their operations where possible—which increases demand for natural gas.

Historical performance of oil

When examining oil’s performance, there are generally two major benchmarks:

• Brent crude oil is the main global oil benchmark.
• West Texas Intermediate (WTI) is the main benchmark of North America.

Between the two, Brent better represents global oil performance because it prices much of the world’s traded crude. And, it’s often the best way to track historical oil performance. In fact, even the U.S. Energy Information Administration now uses Brent as its primary reference in its Annual Energy Outlook.

Looking at the Brent benchmark across several decades, oil has been anything but steady. It’s seen spikes due to factors such as wars and supply cuts, and it’s also seen crashes from global recessions and an oversupply (called a “glut”). For example:

• The early 1970s brought the first big oil shock when the Middle East cut exports and imposed an embargo on the U.S. and others during the Yom Kippur War.
• Prices dropped in the mid-1980s for reasons such as lower demand and more non-OPEC oil producers entering the industry.
• Prices spiked again in 2008 with increased global demand, but it soon plummeted alongside the global financial crisis.
• During the 2020 COVID lockdown, oil demand collapsed like never before—bringing prices below $20 per barrel.

All to say, oil’s historical performance has been anything but smooth. Again, it’s hugely affected by wars, recessions, OPEC whims, evolving energy initiatives and policies, and much more.

Energy coverage from Fortune

Looking to stay up-to-date regarding the latest energy developments? Check out our recent coverage:

• Strait of Hormuz isn’t that closed, allowing more oil to leak out—major escalation is likely
• SpaceX is hiring in natural gas trading for energy needs
• Trump says oil companies are ‘making too much money.’

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This story was originally featured on Fortune.com

The new head of Iran’s top security body warned Sunday that Tehran will see any country’s support for new U.S. economic measures against the Islamic Republic as an “act of war,” while Iran’s president defended a memorandum of understanding with the United States as the best way out of the stalled conflict.

Treasury Secretary Scott Bessent on Monday is expected to announce the new measures after the U.S. vowed to impose an “unprecedented” level of economic warfare and isolation on a country that has lived for decades under sanctions. Also Monday, Pakistan’s army chief is expected to visit Iran as mediators try to revive talks.

Meanwhile, attacks calmed on the Strait of Hormuz but posturing did not, as a recently created Iranian authority listed dozens of vessels it said will face restrictions on future transits.

Here’s a look at the latest developments in the Iran war and the wider Middle East on Sunday. Full coverage can be found here.

Iran’s security chief sharpens warning to neighbors

The hard-line leader of Iran’s Supreme National Security Council, Mohsen Rezaei, issued his latest warning on X, with the comments quickly shared by Iranian state media.

It came a day after Rezaei’s most extensive public comments since being named to the post this month.

“If (Trump) wants to do something, we will retaliate in a seismic manner,” he had told the state broadcaster in an interview that aired late Saturday. He said Iran would target other oil-shipping routes from the Persian Gulf — alternatives to the Strait of Hormuz.

Rezaei, a former Revolutionary Guard commander and military adviser to Supreme Leader Ayatollah Mojtaba Khamenei, was part of senior appointments widely seen as hardening Tehran’s political and military stance.

Iranian president wants to move past ‘neither war nor peace’

Iranian President Masoud Pezeshkian earlier Sunday said the memorandum of understanding signed in mid-June was the best way to move beyond a situation of “neither war nor peace,” adding that Tehran can’t attract investment nearly six months after the war began.

“There is not a single provision in this agreement that amounts to capitulation,” Pezeshkian said in a speech published by state-run IRNA. “The supreme leader sets the policies, and we will follow that path.”

The interim deal opened a 60-day period for talks aimed at ending the war and reaching an accord on Iran’s nuclear program. That period ended last week with no signs of compromise or extension.

No attacks confirmed on the strait, but new restrictions

There were no confirmed attacks in the Strait of Hormuz over the past 48 hours, a multinational coalition overseen by the U.S. Navy said Sunday, with shipping traffic still at reduced levels. The U.S. military said its blockade of Iranian ports had redirected 70 commercial ships and disabled three as of Sunday.

Iran’s recently created Persian Gulf Strait Authority, sanctioned by the U.S., published a list of dozens of ships it said had violated arrangements for transiting the strait and would face future restrictions like fines or seizures. The strait had been considered an international waterway before the U.S. and Israel attacked Iran on Feb. 28.

Iran and Oman, on the strait’s other side, are now discussing management of it, which likely will include ships paying fees.

Pakistan’s army chief will visit Tehran

Pakistani Field Marshal Asim Munir will lead a delegation to Tehran on Monday, Iranian state television reported, citing Iran’s Foreign Ministry spokesperson, Esmail Baghaei.

Two regional officials said the visit was part of Islamabad’s efforts to de-escalate tensions between the United States and Iran and urge them to return to the negotiating table. The officials spoke on condition of anonymity because they were not authorized to discuss the matter publicly.

— By Munir Ahmed in Islamabad

Iran executes man arrested during January protests

The Iranian judiciary’s Mizan news agency reported the latest execution connected to nationwide protests early this year, saying Majid Adineh was arrested Jan. 9 in Mohammadshahr, west of Tehran.

The judiciary said forensic examinations indicated the handgun found on him had been fired on Jan. 8 and 9. Mizan said Adineh had joined the unrest following calls by groups opposed to Iran’s government and alleged that he had received training from groups outside the country. He was convicted under Iran’s law imposing harsher penalties for espionage and cooperation with hostile states.

Israeli settler arrested in beating of Palestinian amputee

Police arrested a 16-year-old boy from the Israeli settlement of Avigayil in the beating of a 61-year-old Palestinian, Saeed Muhammad Ibrahim Rabah, outside his home in the occupied West Bank, a year after he lost a leg after being shot by a settler.

Rabah told The Associated Press that the violence at his home in Khirbet al-Rakeez on Saturday was an effort to make families leave, but “we will remain, no matter what happens.”

Separately, the West Bank Health Ministry said a 14-year-old in the Askar refugee camp in Nablus was shot dead by Israeli forces, who did not immediately comment. The uncle of Islam Maher Ajouri, Nehad Ajouri, called the shooting indiscriminate.

And Israel’s military said it detained a suspect in a stabbing attack that wounded a 24-year-old Israeli man in the area of al-Auja in the West Bank. Israel’s emergency services said the man was in moderate condition.

Airstrike in Gaza kills a 4-year-old child

Four-year-old Mohammed Taha died after an Israeli airstrike hit a central Gaza house on Sunday and wounded at least five others, according to the Al-Aqsa Martyrs Hospital, which received the casualties.

Israel’s military later said it struck and killed a Hamas commander in central Gaza. The hospital confirmed that the man named, Ismail Abu Ful, was killed.

An Israeli strike in southern Gaza wounded at least seven people, including three children, according to health officials at Nasser Hospital. The military did not immediately comment.

And Defense Minister Israel Katz in a statement said he instructed the military to “act immediately and forcefully” to prevent launches of balloons, kites or drones from Gaza toward nearby Israeli communities.

Before the Oct. 7, 2023, attack by Hamas-led militants on Israel — when 1,200 people were killed and 251 taken hostage — burning kites and balloons were sent from Gaza into southern Israel, causing fires and other damage.

Hamas in a statement Sunday accused Israel of “using children’s toys as a pretext” for attacks and further displacement of Gaza residents.

This story was originally featured on Fortune.com

Five years ago, Bill Ackman said it would have been too hard to lure top scientists away from universities. Now, he thinks the balance of power has shifted.

The billionaire investor and his wife, designer and entrepreneur Neri Oxman, are launching a new Manhattan neuroscience and longevity center called the Ackman Oxman Institute, or AOI. Ackman said in a lengthy Aug. 19 post on X that the couple is donating roughly $400 million in Pershing Square stock to anchor the institute, with another gift of a similar or potentially greater size to come.

“Our goal is to build the world’s greatest brain research, rehabilitation, recovery, human optimization, and longevity institute,” Ackman wrote. 

The project is partly a bet on brain science, but also one that traditional universities have become more vulnerable in the competition for elite researchers.

Ackman said he and Oxman considered creating a brain institute half a decade ago, inspired in part by Oxman’s mother, who died from Alzheimer’s. They decided against it because New York real estate was too expensive and they believed it would be “too difficult to recruit the best talent from universities to our effort,” Ackman wrote.

But he said the equation has changed. The real estate needed for the project became available at a 70% discount. Universities, meanwhile, have become “a much less attractive place to work,” he wrote, citing campus politics, antisemitism and declining funding.

That claim fits into Ackman’s broader fight with elite universities. He helped lead the pressure campaign against former Harvard president Claudine Gay, criticized the university’s handling of antisemitism, attacked its DEI policies and later called for the ousting of several Harvard board members.

Ackman’s post didn’t mention data points about scientists leaving universities en masse. But his new institute is being structured around the idea that top researchers can be persuaded to leave, or at least work outside, the traditional university system.

AOI will be “patient-centric” and explicitly focused on turning scientific discoveries into treatments, Ackman wrote. It will not be an academic institute that produces “lots of papers” but “little if any results for patients.” Instead, its mandate will be to speed the path from research to cures, treatments and devices. 

“If you are going to have a devastating brain injury, now is the best time in history for that to happen,” Ackman wrote. “We are living in a world when you can be confident that the blind will soon see again.  We are going to do everything we can to help make that happen, including by assisting existing companies in the space.”

Though AOI will be a nonprofit, Ackman explained it will have “highly commercial instincts.” The institute plans to run its own venture funding operation, create and seed companies around technologies developed there, and reinvest the financial returns into further research.

The project also has a sizable physical footprint. Ackman said the Pershing Square Foundation acquired a nearly vacant, 400,000-square-foot biotech facility on Manhattan’s West Side after a real estate colleague alerted him to the property in May. The foundation also has an adjoining 130,000-square-foot building under contract and is acquiring a neighboring vacant lot.

With additional construction permitted under current zoning, Ackman said the campus could reach 680,000 square feet—larger than Rockefeller University’s laboratory footprint.

The institute will combine neuroscience, rehabilitation, nutrition, clinical trials and longevity research onto the same campus. Ackman also wants AOI to work across institutional boundaries, with Mount Sinai as an important partner but not its only collaborator.

“We don’t believe any institution has a monopoly on the best ideas or the best talent,” he wrote.

Inspiration for the institute 

The project grew out of a family crisis. His 26-year-old daughter Lucy had a brain hemorrhage and underwent emergency surgery after being found unconscious in her Brooklyn apartment. Ackman wrote in the X post that months of treatment and rehabilitation convinced his family of both the brain’s ability to recover and the limits of existing treatment.

“The interesting thing is that everything I’ve done in my life up till now has prepared me to help her,” he previously told Fortune, explaining that he had to exhort the doctors to try novel treatments like injecting mitochondria into Lucy’s eye to help preserve her sight. AOI will build off the insights gained from her treatment, he said. 

Ackman also sees AI and brain-computer interfaces as key to AOI’s mission, writing that Lucy might need brain-computer support that’s being developed at companies like Neuralink, Precision Neuroscience and Synchron. He argued his new institute should be “at the forefront of the interplay between the brain and AI.”

AOI has already identified a CEO whom Ackman expects to announce by October, and it is searching for a chief scientific officer, chief AI and technology officer and other senior leaders. He said the board includes inventor Dean Kamen (whom he described as ”our generation’s Thomas Edison”), Regeneron co-founder and chief scientific officer George Yancopoulos, Nobel Prize-winning biochemist James Rothman, neuroscientist Bernardo Sabatini, neurosurgeon Chris Kellner, Pershing Square Foundation CEO Olivia Flatto, Oxman and Ackman himself. 

“We have learned from Lucy that the brain can recover from even catastrophic injury,” he wrote. “There is so much more work to be done as the mind is a terrible thing to waste.”

This story was originally featured on Fortune.com

Good morning. New York has overtaken the San Francisco Bay Area as North America’s largest tech-talent workforce by headcount, and Wall Street’s growing demand for AI talent is helping reshape the market—though San Francisco isn’t ceding its crown entirely.

The finding comes from CBRE’s “Scoring Tech Talent 2026” report. New York Metro’s tech-talent workforce grew by 30,640 to 394,300 between 2022 and 2025, while the San Francisco Bay Area’s contracted by 23,900 to 375,730—marking the first time New York has led by headcount in the report’s 13-year history.

The shift reflects New York’s more diversified tech economy. While 61% of San Francisco’s tech talent works directly in high-tech companies, New York’s tech workforce is spread more broadly across industries, including financial services.

Across the U.S. and Canada, the number of tech-talent workers with AI skills rose 45% year over year to 751,000 as of mid-2026. The San Francisco Bay Area still leads in raw AI-specialist numbers and has a higher concentration of AI job postings overall (26%, versus 17% in New York).

But when it comes to financial services specifically, New York and Dallas-Fort Worth tied for the highest concentration of AI-specialty talent among major markets, at 20% each, ahead of Toronto (19%) and Chicago (16%). Financial firms are increasingly competing with technology companies for workers who can put AI into production inside highly regulated businesses.

Jamie Dimon, CEO of JPMorgan Chase, recently said the bank will likely hire more AI specialists. “There will be all different types of jobs, and I think we will be hiring more AI people and fewer bankers in certain categories,” he said in a Bloomberg Television interview.

JPMorgan’s Data & AI organization includes teams working on LLM applications, fraud models, risk systems, personalization and automation.

Big banks—including JPMorgan, Citi, Wells Fargo, and Bank of America—are all investing heavily in AI to boost efficiency, and Bank of America is already pointing to measurable returns.

I reported last month that during a media call regarding Bank of America’s second-quarter earnings, CFO Alastair Borthwick said, “New AI capabilities now allow more than 200,000 of our employees to work more effectively, and they’ve helped contribute to producing a 59% efficiency ratio, a roughly 360 basis point improvement from last year.”

Slower hiring and layoffs in the technology industry have also created opportunities for non-tech employers to build their tech-talent teams. CBRE found that financial services, insurance and real estate added 90,530 tech jobs since 2022, while the high-tech sector shed 21,262.

Although New York now leads in tech-talent headcount, San Francisco remains No. 1 in CBRE’s broader tech talent ranking—which incorporates 13 metrics including talent concentration, wages and AI strength, areas where the Bay Area’s smaller, denser workforce still gives it an edge.

Sheryl Estrada
Sheryl.Estrada@fortune.com

This story was originally featured on Fortune.com

One of the hottest debates in the energy industry right now is how much oil is actually coming out of the Persian Gulf, and the answer could determine how long the Iran war lasts.

Iran insists the Strait of Hormuz is closed and that it has control of the narrow waterway, which saw 20 million barrels of oil a day pass through before the U.S. and Israel started the war.

But the Trump administration has pushed back on that narrative. Energy Secretary Chris Wright said the U.S. military helped ship over 15 million barrels of oil and products out of the strait on Tuesday, though the seven-day average is 8 million. When combined with oil exported by pipelines, the total leaving the region is closer to 20 million barrels, he posted on X on Friday.

Meanwhile, U.S. officials told Axios that about 10 million barrels of oil a day are being transported out of the strait through a corridor the U.S. military established that runs along Oman’s coast.

A two-week stretch of U.S. bombing last month degraded Iran’s radar and maritime surveillance systems, the report said, making it easier for tankers to sail through undetected at night with their transponders turned off. This has allowed vessels to make shuttle runs in and out, then unload oil to other tankers that deliver the cargo to customers.

David Wech, chief economist at energy intelligence firm Vortexa, told CNBC on Friday that the average over the last month has been 6 million-7 million barrels a day. But peak volumes over a seven-day moving average are nearly 10 million barrels, with the highest day at 14 million.

Either way, the upshot is that significant levels of oil supply are getting out and that the Strait of Hormuz isn’t really closed off after all.

To be sure, there’s still a supply deficit, forcing consuming countries to keep tapping their reserves, which are reaching critically low levels. And the U.S. naval blockade is preventing Iran from exporting its oil

But the amount leaking out of the Gulf buys more time before global markets go off a cliff—and that could also prolong the war as both sides remain locked in a stalemate.

“Barrels getting through raise the odds of a longer war, possibly deep into 2027: neither side feels urgency if oil does not materially move and Iran still earns enough to sustain the regime,” Dan Alamariu, chief geopolitical strategist at Alpine Macro, wrote in a note last week.

Indeed, there has been no diplomatic progress lately as Iran has made demands unacceptable to the U.S., while Trump wants the regime to relinquish its grip over the strait, its main source of leverage. At the same time, Trump has shied away from resuming all-out war, especially with key munitions supplies low, and instead is relying on economic pressure.

U.S. Air Force photo by Senior Airman Brooklyn Golightly

Alamariu described the current equilibrium as a state of “managed disruption” marked by a permeable Hormuz blockage, occasional military flare-ups, and escalatory threats. But there’s potential for periods of sharp crisis as Iran’s economy continues to suffer and puts the regime at risk, he added.

“And if the Strait is not fully closed, Iran’s leverage is weak,” Alamariu pointed out. “Thus, Iran has reasons to escalate.”

U.S. midterm elections represent an opportunity for the Islamic Republic to hurt Trump by causing oil prices to spike and stirring more voter discontent against Republicans in Congress, he warned. That risks U.S. retaliation and even more escalation.

Until the election, Trump could maintain the blockade and hope for the best as long as Brent crude stays below $90-$100 per barrel, Alamariu wrote. But if oil tops $105-$110, then high gas prices and inflation could push the U.S. to try to reopen the strait by force or destroy more Iranian offensive capacity.

“These are not mechanical triggers, but they can make oil self-correct through violence,” he added.

Esfandyar Batmanghelidj, founder and CEO of the Bourse & Bazaar Foundation think tank, said Trump has erased the distinction between economic warfare and military conflict in the eyes of Iran’s leadership.

Tehran also interprets Trump’s reliance on economic pressure as a strong signal that he doesn’t have the stomach for renewed fighting, he said in a post on X.

“Iran’s leaders are confident they can go on the offensive because they are interpreting the shift to economic pressure as a sign of weakness. They believe that if they can land a few more punches, Trump will end up down for the count and have to return to the promises made in the MOU,” Batmanghelidj wrote.

This story was originally featured on Fortune.com

Some of Nvidia Corp.’s biggest customers have been told that the prices of servers containing its artificial intelligence chips are going up more than 15% in many cases with memory chip costs soaring.

The price hikes will go into effect on systems shipped early next year and will impact systems including those with the flagship Vera Rubin and Grace Blackwell chips, according to people familiar with the process, who asked to not to be identified commenting on communications that haven’t yet been made public. The increases will depend on the generation of Nvidia chips and the memory configurations, they said.

Companies who build the servers under contract for large data center operators such as Microsoft Corp., Alphabet Inc.’s Google and Oracle Corp. have recently notified their customers of the forthcoming increases, the people said. Nvidia representatives didn’t respond to requests for comment. 

The inability of the industry’s most dominant company to hold the line on prices or absorb growing costs shows how much leverage makers of memory chips – Samsung Electronics Co., SK Hynix Inc. and Micron Technology Inc. – have amid a surge in demand for AI infrastructure. Major technology companies including Apple Inc. and Qualcomm Inc. have recently said they’ve been forced to charge more for their products because of chip shortages. 

Nvidia’s accelerator processors are the heart of computers that create and run AI software. Their effectiveness depends on how much dynamic random access memory, or DRAM, they are paired with. The two Korean companies and Micron account for most of the world’s production of that type of chip. While they’ve been increasing output, they still haven’t caught up with surging demand. That’s driven the price of the commodity-like components up massively and given their manufacturers unprecedented influence in technology. 

Nvidia is one of the most profitable companies in semiconductors. It’s able to charge tens of thousands of dollars per chip because supply — from contract manufacturer Taiwan Semiconductor Manufacturing Co. — still can’t meet runaway demand. The company has a gross margin, or percentage of sales remaining after deducting the cost of production, of 75%. Originally derived from PC gaming chips that sold for hundreds of dollars, AI accelerators have seen prices being driven up by incessant demand and, as yet, a dearth of viable alternatives for Nvidia’s offerings.  

Nvidia has also raised prices for its gaming-oriented PC graphics cards, industry news site Tom’s Hardware reported earlier this month.

How Nvidia’s customers react to this latest move and whether it will create an opening for its competitors will likely depend on whether they’re able to secure enough memory themselves. Major customers like Amazon, Microsoft, Google and Meta are all pursuing their own in-house chip programs but are still dependent on purchases from Nvidia for their data center build-outs. Their ability to push forward with greater independence will also depend on their access to supply from Samsung, SK Hynix and Micron. 

The price increases are also likely to add complexity to the industry’s massive AI data center build-out ambitions. Project delays, labor shortages, tightening capital markets and community resistance to developments have already complicated many plans.

Nvidia is reporting fiscal second-quarter earnings next week. The updates by the world’s most valuable publicly-traded company have become a key update for the technology industry and investors who have poured money into AI infrastructure on the promise that it will transform the economy.

This story was originally featured on Fortune.com

The enormous mountain of debt hanging over the economy has overshadowed the AI boom as the center of attention on Wall Street.

For years—decades even—the spiraling trajectory of U.S. debt fueled dire warnings, which investors consistently brushed off as low borrowing costs helped turbocharge epic stock gains.

Meanwhile, the debt pile galloped higher, interest costs sucked up a bigger share of the federal budget, and deficits continued to expand. Rating agencies downgraded U.S. credit, and foreign central banks stopped buying as many Treasuries.

The precise tipping point was always unclear, especially as the U.S. dollar retained its status as the world’s top reserve currency. But the global bond selloff this past week that sent yields to the highest level in two decades showed debt is finally front and center as a concern.

“When does debt become unsustainable? When the global financial markets say it is,” RSM Chief Economist Joseph Brusuelas said in a note on Wednesday. “That appears to be happening.”

Debt worries weren’t limited to the U.S., with yields in other top economies like the U.K., France, Germany, and Japan also surging.

That’s as governments since the COVID pandemic have continued spending as if borrowing costs were still at crisis-era lows and letting deficits worsen as if their economies were still in desperate need of emergency stimulus.

But the economic landscape is totally different now. Interest rates have surged in recent years to combat high inflation, and the AI boom is pouring hundreds of billions of dollars a year into an economy that increasingly immune to higher rates.

In addition, the so-called hyperscalers are relying more on debt to finance their capital expenditures, competing with the Treasury Department for bond market dollars.

“Given that public debt is already so high for many countries, it’s only been a matter of time until markets run out of patience,” Robin Brooks, a senior fellow at the Brookings Institution, wrote in a Substack post on Tuesday. “It looks like that’s happening now.”

Yields went up so quickly that the Treasury Department suddenly announced it will increase buybacks of long-dated bonds. The move briefly lowered yields, but they went back up again as investors doubted such financial engineering can hold back the tide.

How did we get here?

In addition to deficits, other factors converged to finally set off alarm bells in the market. The more proximate cause was the return of higher oil prices amid the ongoing stalemate between the U.S. and Iran.

With no signs of any diplomatic progress, investors expect energy costs will keep inflation higher for longer, likely forcing central banks to hike rates.

But Federal Reserve Chairman Kevin Warsh has refused to offer forward guidance on how policymakers will respond to future inflation, creating uncertainty that put even more upward pressure on bond yields.

Brusuelas also pointed to an “elephant in the room,” namely economic populism from both sides of the aisle. From the left it takes the form of more spending. And from the right, it’s typically tax cuts.

Both versions also tolerate higher inflation and resist efforts by central banks to rein it in, he added.

“If such policies go on long enough without a course correction, banking and currency crises tend to follow,” Brusuelas warned. “Global investors understand the end game of such policies.”

Similarly, analysts at Capital Economics said in a note Tuesday that bond investors are demanding greater compensation for fiscal, geopolitical and policy uncertainty, describing it as a shift that will prove persistent. 

While the pace of the bond selloff isn’t justified by recent events, the market’s concerns are rational as governments show little indication of curbing deficits, they added.

That means a higher term premium, or the extra return that investors demand for holding an asset over the long term, is “fundamentally warranted.”

“As a result, we expect term premia to remain elevated and bond markets to remain susceptible to renewed bouts of volatility in the quarters ahead,” Capital Economics predicted.

This story was originally featured on Fortune.com

Business leaders, from JPMorgan’s CEO Jamie Dimon to Tesla’s Elon Musk, have argued that workers need to get back to the office in the name of productivity and collaboration. But a new study suggests the opposite may be better for employee well-being—and even company bottom lines.

Researchers tracked 7,704 employees at the University of Texas MD Anderson Cancer Center across three work arrangements: roughly one-fourth worked fully remotely, one-fourth worked hybrid, and about half worked entirely onsite.

The results? Employees who worked fully remotely reported the highest levels of workplace well-being—defined broadly to include physical, mental, emotional, social, and financial health—while those who worked entirely onsite reported the lowest. The study, which was published in the journal Frontiers of Psychology last month, also found little evidence that remote workers felt less connected to colleagues or workplace culture.

“Our findings challenge the idea that simply bringing people back into a building will automatically make them more engaged, connected, or likely to stay,” co-authors Stefanie Johnson, a professor at the University of Colorado Leeds School of Business, and Courtney Holladay, chief learning officer at MD Anderson Cancer Center, told Fortune in a joint statement.

“The mistake is treating physical presence as the outcome rather than asking what organizations are trying to accomplish through it. If the goal is collaboration, mentoring, innovation, relationship-building, or organizational culture, then employers should design experiences that actually produce those outcomes.”

Remote work could help companies save money—by keeping their best talent around

The benefits of remote work didn’t stop at how employees said they felt. One year after the initial survey was completed, researchers examined employee turnover and found that workers with higher levels of well-being were less likely to leave the organization, meaning those working remotely were associated with higher retention.

For companies, keeping talent around can be a major financial incentive. After all, even before the pandemic ushered in an era of remote work, U.S. businesses were losing $1 trillion annually due to voluntary turnover, according to a 2019 Gallup analysis. However, critics of return-to-office mandates have argued that requiring employees to return to the office can serve as a backdoor way to reduce headcount without formally laying off workers. A survey last year suggested that concern isn’t entirely unfounded: one in five HR professionals admitted their company’s in-office policy was intended to encourage employees to quit.

“Clearly we have to question the motive,” Johnson said, pointing to separate research that found that leaders who display stronger narcissistic qualities are more likely to dislike remote work.

But the answer may not be as simple as remote versus in-office. Hybrid work can sound like the best of both worlds—giving employees flexibility while preserving opportunities for face-to-face connection. Yet it can also create its own headaches, from coordinating schedules to commuting on some days and figuring out which colleagues will actually be around.

“We’ve heard from individuals who will go into the office and their day in the office is spent on Zoom or Teams calls, and then that’s really frustrating because it’s like, ‘Well, I could have done that at home,’” Holladay said, adding that remote work can also save money in terms of having to rent less office space.

While the researchers did not track productivity in their study, they argue overall that flexibility may matter more than any particular work arrangement. Johnson said that may be particularly important for younger workers who are still trying to build out meaningful relationships early in their careers.

“Not that you should have to bribe employees to go into the office,” Johnson said. But if workers are going to come in, she added, companies should give them a reason to feel that the time is valuable.

Public and private leaders are adamant that return to office is a good thing

The findings come as some of the most powerful voices in corporate America continue to make the case for getting workers back in the office.

JPMorgan Chase CEO Jamie Dimon, for example, has long been one of Wall Street’s most outspoken proponents of in-person work—calling his over 300,000 workforce back into the office five days a week.

“If you go to a meeting with me, you got my full friggin attention the whole time,” he said at the Hill and Valley Forum earlier this year, adding that remote work only works well for certain jobs like call centers, but for everyone else, including young people and managers alike, in-person working is best. Young people, especially, he said, need to work in-person because they are still learning.

Tesla CEO Elon Musk has taken a similar hard line. In 2022, he told employees that anyone who wanted to work remotely had to spend at least 40 hours a week in the office or leave the company.

“Tesla has and will create and actually manufacture the most exciting and meaningful products of any company on Earth. This will not happen by phoning it in,” Musk said.

The federal government has also been pushing its hundreds of thousands of employees back into the office, with Office of Personnel Management (OPM) Director Scott Kupor being the key driver of President Donald Trump’s return-to-office agenda.

“Even for jobs that can be done largely in isolation, that productivity can be impacted by distractions that pervade at the home,” Kupor wrote in a January 2026 blog post entitled “Why Showing Up Counts.” “Supervising a massive, largely remote federal workforce is not something the federal government is well equipped to do.”

However, in a leaked audio message obtained by Fortune, Kupor admitted in a hot mic moment that he intentionally filmed a video in front of a blank wall while he was working from home so he wouldn’t get blowback over working at home.

A spokesperson said that Kupor was taking a day off and therefore was not considered to be teleworking. Still, the episode illustrates the tension at the heart of the RTO debate: Even as companies and governments argue that workers are better off in the office, the appeal of working from home can sometimes be difficult for anyone—including the people making those rules—to ignore.

This story was originally featured on Fortune.com

A financial crisis that has long been predicted by Russia experts and Kremlin insiders appears to have finally arrived as banks see depositors scramble to pull out their money amid fears it may be seized.

In the first half of August, Russians withdrew $3.4 billion (286.4 billion rubles), according to central bank data cited by the Washington Post. That’s after $7.3 billion was withdrawn in July and $4.5 billion in June.

“Drones are flying. Things are burning down. Nervousness is growing. And people’s everyday wisdom may be kicking in that they need to have cash under their pillow and not somewhere in banks where it may never be returned,” a former finance official told the Post, adding that banks have much of their capital tied in loans elsewhere.

The situation echoes the iconic scene from the movie It’s a Wonderful Life, when panicked depositors show up at the Bailey Bros. Building & Loan demanding their cash, only to learn that it’s not all there.

The bank run in Russia may not be as dramatic or precipitous. But the stampede out of lenders this year is on track to nearly double the $24.7 billion pace that was seen in 2022, when Vladimir Putin launched his invasion of Ukraine.

Back then, Russia was flush with cash and expected to pay for a short war. But more than four years later, the invasion has turned into a quagmire that has crushed the Kremlin’s finances.

The budget is sinking into deeper deficits, the sovereign wealth fund has been nearly depleted, and tax hikes are straining consumers who are already struggling with high inflation.

Moscow has directed banks to offer capital to the defense industry, but many of those loans turned into bad debts. Now, the financial sector’s loss of deposits has created a liquidity crunch so severe that it’s threatening Russia’s ability to fund its war.

Taras Skvortsov, a senior executive at top retail lender Sberbank, told Russian radio that many banks don’t have cash on hand to buy government bonds.

In fact, the finance ministry halted bond auctions indefinitely last month amid higher borrowing costs and weak investor demand. The auctions are the Kremlin’s main source of domestic borrowing to fill its budget deficit, which hit $76 billion at the end of July.

As the government’s sources of funding dry up, ordinary Russians fear their money may be next. The leader of Russia’s Communist Party told parliament recently that 130 trillion rubles held in bank accounts should be “mobilized” to address the country’s economic and budget woes.

Meanwhile, the finance ministry is preparing legislation that could let it gain access to $40 billion in pension savings held in privately managed funds.

That’s after Russian oligarchs have seen their businesses nationalized, with $51.5 billion in assets seized for the state last year.

“If the government needs cash, Putin will just do a grab for assets. He doesn’t care,” an associate of a Russian billionaire told the Post. “And that’s where I think it’s heading.”

Warnings about Russia’s finances have been building for months. In June 2025, Russian banks raised red flags on a potential debt crisis as high interest rates weighed on borrowers’ ability to pay off loans. Also that month, the head of the Russian Union of Industrialists and Entrepreneurs warned many companies were in “a pre-default situation.”

The Center for Macroeconomic Analysis and Short-Term Forecasting, a state-backed Russian think tank, said in December the country could face a banking crisis by October if loan troubles worsen and depositors pull out their funds.

Earlier this year, Russian officials told Putin that a financial crisis could hit by the summer amid spiraling inflation. 

In May, sources told the Russian newspaper Izvestia that nearly 25% of the bond market is now at risk of default as businesses that borrowed at low rates must refinance at much higher ones. The volume of debt that needs to be rolled over this year is about double from last year, adding pressure on cash flows and raising competition for liquidity.

And according to a European intelligence report this past June, Russian lenders are vulnerable due to soaring indebtedness and deteriorating loans. It said the number of Russians who declared bankruptcy last year jumped by almost a third to more than 500,000.

“The situation creates the illusion of a dynamic economy ⁠that, in reality, conceals an explosive situation which an economic shock, such as an ambitious package of sanctions against banks … could trigger,” the report added, according to Reuters.

The worsening state of Russia’s financial sector mirrors its performance on the battlefield. New Ukrainian tactics and drones have halted Russia’s advance, decimated the country’s oil infrastructure, and pushed casualties above the replacement rate.

And just like Russia’s search for money to seize, reports indicate the military is preparing to ramp up the number of men it seizes to fill the ranks.

Authorities have already been using coercive tactics to find fresh troops. Now, sources told the Wall Street Journal that the military is preparing plans and procedures for a wider mobilization.

But because of an expected political backlash, the Kremlin may wait until after parliamentary elections next month to announce it.

An earlier mobilization in September 2022 set off a mass exodus of hundreds of thousands of men, who fled to neighboring countries like Georgia and Kazakhstan.

Rumors of a new one have already sent cross-border traffic soaring. In addition, property prices have jumped recently in Georgia and Armenia in anticipation of another exodus, real estate agents told the Journal.

This story was originally featured on Fortune.com

In the hills of Emilia-Romagna, a bank vault holds more than half-a-million wheels of Parmigiano Reggiano, worth well over 300 million euros.

The vault belongs to the bank Credito Emiliano, known colloquially as Credem, which has accepted young wheels of Parmigiano Reggiano as collateral for loans to local dairy farms since 1953.

But now, extreme heat is threatening Italy’s “cheese banks,” and economists who study heat’s effect on growth say the exposure runs well beyond a single vault but into the country’s vineyards, its olive groves, and its broader economy.

A blockchain-backed cheese loan collateral program

After receiving the wheels of cheese from dairy farmers, a Credem subsidiary, Magazzini Generali delle Tagliate, ages the wheels in two warehouses in Reggio Emilia and Modena. Producers typically receive 60% to 80% of a wheel’s value upfront.

But the process has come a long way from the 1950s, as blockchain technology now lets farmers pledge wheels even while the cheese stays in their own facilities, doubling Credem’s lending capacity. The arrangement solves a real problem: Parmigiano needs at least 12 months to age, often 24 or 36, and small family farms can’t easily keep that much inventory tied up for that long without generating some cash. So the bank provides some before any sales are made.

The scale of that arrangement is bigger than the vault itself. Italy produces about 4 million wheels of Parmigiano Reggiano a year, and the cheese banks hold about 500,000 of them, Giancarlo Ravanetti, who runs the bank’s cheese warehouse business, told CNN. His warehouses handle about 2.3 million wheels a year in total.

Meanwhile, Parmigiano Reggiano is a 4 billion euro ($4.7 billion) industry sustained by roughly 300 certified dairies, and keeping that much cheese at the right temperature has gotten more expensive. Thanks to this year’s record heat waves in Europe, daily energy consumption rose about 30%, forcing the bank to upgrade cooling systems and boilers, add insulation, and expand renewable power generation.

Climate change is affecting dairy farmers’ milk supply as well. Because it’s so hot outside, cows lie down more and eat less, reducing milk production by up to 10% a year. As longer and more intense heat events become all the more common, they hit both the quantity and quality of milk, ultimately driving up costs.

Climate change hits the vineyard

The same climate pressure is showing up on a similar timeline in Italy’s vineyards. In Lombardy’s Franciacorta sparkling-wine region, the 2026 harvest began July 30, the earliest start on record, after budbreak came more than a week ahead of the historical average. In Sicily, the harvest has stretched into what growers describe as a 100-day picking season across the island’s microclimates, as producers time each variety’s picking to stay ahead of the heat.

Coldiretti, Italy’s largest farmers’ association, has called 2026 one of the earliest harvests on record nationally, citing record temperatures and drought that are pushing sugar into the grapes faster than their flavor can develop, a mismatch that’s especially hard on late-ripening reds like the Nebbiolo grape behind Barolo.

Some producers have begun testing shade netting over vineyards, originally used against hail, to cut the sun exposure that would otherwise strip the grapes of acidity. Coldiretti also pointed to a cost layered on top of the weather: The conflict in Iran has added an estimated 250 euros per hectare in energy, fertilizer, and materials costs for wine producers this year, with export values already down 7% in the first four months of 2026.

But olive groves have taken the sharpest hit. Puglia and Calabria, Italy’s two largest olive oil producing regions, have seen national production fall well below its historical average of more than 350,000 tons, coming in around 270,000 to 300,000 tons for the 2025/26 season. In past drought years, Puglia’s output has fallen by more than half in a single season.

R. Jisung Park, a labor economist at the University of Pennsylvania’s Wharton School and author of Slow Burn: The Hidden Costs of a Warming World, says the pattern showing up across Italy’s cheese, wine, and olive oil industries fits a wider body of research that links heat directly to lost economic output.

A European Central Bank working paper found that the GDP hit from extreme heat is smaller in Spain and Italy than in Germany, since both those countries are more used to high temperatures. But Park said a small top-line number can still hide real damage elsewhere. “Supply-chain spillovers due to heat upstream actually lead to measurable downstream firm valuation impacts,” Park told Fortune.

That is close to what’s playing out in Emilia-Romagna, where a heat shock to dairy cows turns into a cost problem for a bank months later, and in Puglia, where a hot, dry spring turns into a production collapse hundreds of miles from where the olives grow. Park said heat’s economic toll tends to hide in these kinds of indirect, delayed effects instead of showing up all at once, which is part of why companies and governments still underprice the effects of climate change.

The U.S. has its own cheese caves

The idea of a government stepping in to protect dairy farmers from forces beyond their control is not new to the United States either. During the Great Depression, milk prices collapsed and dairy farmers dumped their own product in the street to protest.

President Franklin D. Roosevelt’s New Deal responded with subsidies for farmers who cut production and in 1933 created the Commodity Credit Corporation to buy up surplus butter, cheese, and dried milk to keep prices stable.

That policy long outlived the Depression. Decades later, the government was still buying surplus cheese and storing it in vast underground caves in Missouri, Wisconsin, and Kansas, warehouses cool enough to hold the cheese for years without spoiling.

By the early 1980s, the federal stockpile topped 500 million pounds. Italy’s cheese banks solve a similar problem with a different tool: Instead of a government buying surplus to prop up prices, a private bank lends against the cheese itself, betting that the wheels sitting in its vault will still be worth something by the time they are ready to sell.

This story was originally featured on Fortune.com

House Democratic leader Hakeem Jeffries and President Donald Trump’s son-in-law and outside adviser Jared Kushner met privately recently in New York, a signal that the White House is seeking ways to work with Democrats if they wrest majority control from Republicans in the midterm elections.

The meeting, first reported Sunday by The New York Times, touched on issues ranging from housing, immigration to the high costs of living. People in the United States are struggling under inflationary prices that Democrats blame on Republicans, alongside Trump, for failing to get under control.

Kushner suggested that Jeffries, who is in line to become House speakerif Democrats regain power in November, meet with White House chief of staff Susie Wiles as a follow-up.

Jeffries, in a statement Sunday, did not mention the private conversation but said the Republican administration needed to drop the GOP’s “my-way-or-the-highway” approach that “has failed the American people.”

“To stop the madness, we have repeatedly made clear that an extremist approach will not work and will be met with forceful opposition,” the New York congressman said. “The question is whether Republicans will join us.”

The meeting shows the depth of Republican Party angst over losing their congressional majority, particularly the House, and the need to make inroads with the opposing party as the White House seeks to stem any potential political fallout on the president.

If Democrats retake power, the White House can expect an aggressive oversight agenda into what Jeffries has called the “crooks” in the administration, with the threat of impeachment among the many tools at the party’s disposal.

House Speaker Mike Johnson, a close ally of Trump, bristled Sunday when asked about the meeting. He minimized the role that Kushner, who he said “hedges his bets,” plays in the White House.

“I’m telling you what, you better not bet against the House Republicans,” Johnson, R-La., told Fox News Channel’s “The Sunday Briefing.”

“I don’t know what that’s about,” Johnson said. “I know Jared has interests in lots of other things going on. He’s not really directly involved in the admin, at least in the day-to-day in the White House.”

The White House did not respond to a request for comment. A representative for Kushner also did not respond.

Kushner is a familiar Trump emissary to Democrats

Jeffries and Kushner are not strangers.

The New Yorkers allied during the first Trump administration on landmark legislation to allow sentencing flexibility for certain drug offenses as a way to curtail lengthy terms in the federal prison system.

While not necessarily close, the two have maintained a relationship despite the repeated attacks Trump has leveled against Jeffries and the Democratic leader’s responses. In Trump’s second term, Kushner has an oversize role despite having no formal position in the White House. He serves as an outside adviser and envoy, particularly shuttling to foreign diplomatic missions as the U.S. war against Iran drags into its sixth month.

Trump has only met with Jeffries once since the president returned to the White House, taunting the House leader and Senate Democratic leader Chuck Schumer of New York with red “Make America Great Again” 2028 caps on the desk in front of them in the Oval Office — a nod to Trump’s toying with an unconstitutional third term in office.

After that fall meeting, Trump posted a fake image of Schumer with Jeffries wearing a sombrero with a handlebar mustache in what was widely viewed as a racist trope as he mocked the Democrats before what became the longest federal government shutdown in U.S. history.

Trump has been able to alternately ignore the Congress as he relies on the sheer force of executive power to implement his priorities or to pressure the Republicans in the House and Senate, when needed, to fall in line behind the White House, particularly to confirm controversial Cabinet nominees.

All that is likely to change if Democrats control either chamber, with lawmakers eager for Congress to flex their own power as a coequal branch of government more willing to hold the White House in check.

Republicans and Democrats race for power in midterms

House Republicans are counting on Trump’s popularity among their core voters as they struggle to hold onto majority control, with Johnson believing the GOP will defy history that tends to reward the challengers in midterms and punish the party in power.

The House GOP has a slim majority. Control will likely be won — or lost — in a handful of battleground districts as Democrats put forward candidates in what they hope will be something of a repeat of 2018, when they swept to power riding a wave of voter unrest during Trump’s first term.

While the House is most at risk for Republicans this year, he narrowly split Senate is also increasingly in play. GOP strategists worry about an enthusiasm gap on their side as Democrats appear more eager to head to the polls.

At the same time, Democrats are nominating outsider candidates, some aligned with socialist agendas over establishment backed candidates, in a sign of voter unrest with the status quo.

This story was originally featured on Fortune.com

A U.S. Army unit is offering its troops a special bonus if they reenlist soon: four extra days off timed around the November release of the video game Grand Theft Auto VI.

Commanders of the 9th Brigade Engineer Battalion based at Fort Stewart, Georgia, believe free time to indulge in the latest entry in the Grand Theft Auto series — in which players commit carjackings, battle police in shootouts and attempt audacious heists — will sway some soldiers to extend their military commitments.

The Nov. 19 release of Grand Theft Auto VI is expected to be one of the year’s biggest entertainment events. Game publisher Take-Two Interactive hasn’t released sales figures for preorders, but CEO Strauss Zelnick recently called them “unprecedented and astonishing.”

A career counselor with the Army engineer battalion hatched the idea with commanders to tie a retention perk to the game’s release, in part to remind soldiers of their approaching reenlistment dates, said Lt. Col. Angel Tomko, a Fort Stewart spokesperson.

“The idea was to have a unique incentives program that connects to what soldiers are interested in,” Tomko said Thursday in a statement to The Associated Press.

Battalion commanders wrote in a memo to soldiers that those who sign reenlistment contracts by Nov. 14 would receive “a special 4 day pass.”

“This special pass is specifically designed to coincide with the highly anticipated release of the video game Grand Theft Auto VI,” battalion commander Lt. Col. Ryan Hodgson wrote.

Tomko confirmed the authenticity of the July 28 memo, which was photographed and posted online.

She said at least 20 of 130 eligible soldiers have signed up for the bonus. To qualify, they must commit to serving at least two more years in uniform.

Buzz for Grand Theft Auto VI has been building since 2023, when its first cinematic trailer showed a return to the series’ fictional Vice City — a satirical analogue of Miami — and an expanded swath of Florida-based locales that include gator-infested swamps.

Underscoring the hype, developer Rockstar Games plans to debut gameplay video next week in an extended trailer on Netflix. The rollout was preempted when hackers leaked apparent footage online this week.

This story was originally featured on Fortune.com

The world does not need any more AI productivity tools.

We’ve evaluated such tools running well into triple digits in the past 12 months alone, and believe that the vast majority of those are destined for the graveyard.

We’re in the most exponential cycle of innovation, and therefore value creation, the world has ever seen. Not only has AI allowed for tremendous productivity increases, the rate of change is unprecedented. It is both the most exciting, and amongst the hardest, times to be a venture investor. 

The years 2023 and 2024 saw a mind-boggling rise in AI productivity tools. Vibe coding became real with Lovable, lawyers harnessed Harvey, doctors slashed admin with the likes of Abridge and even the common office worker became far smarter with note taking assistants like Granola. They all deliver as advertised: they search, they summarize, they automate, they save time and capture very useful context in the process. They play across both the first and second phases of the AI development cycle. 

The list of productivity tools, both horizontal and vertical, runs into the many hundreds today. When we are on the precipice of discovering new drugs using in-silico AI modeling, AI Notetaker #25 is not only not needed, it is unlikely to survive as a standalone business. 

Who survives 

Over 50 years ago, Charlie Munger convinced his best friend, Warren Buffett, to ditch the proverbial cheap cigar butts for buying durable, high-quality businesses, centered around their economic moat. Ironically, today, these moats are the weakest they have ever been, specifically in AI-native businesses. 

The pace of innovation that AI has brought about is unprecedented, as is the economic return. Yet the longevity of this economic return is the most unclear it has ever been. Our analysis estimates that around $1TR in net new AI ecosystem revenue was added since the launch of ChatGPT in November 2022 – an unprecedented rate. Meanwhile, the quality of that revenue is amongst the riskiest it’s ever been. AI models are under existential threat from open-source; incumbent chip manufacturers from new entrants; applications from the models themselves, and the weakest of those applications are the plain-jane productivity tools. 

AI applications collectively are today pushing an estimated $150-200BN in ARR, according to Northzone analysis. By far the largest and most mature vertical within this is AI Coding – 20-30% of these revenues – which has amongst the most sophisticated class of AI application products. They too evolved from a basic productivity tool i.e. the Github co-pilot, arguably the first real vertical AI application. From there, it went to a system of action – a Cursor, a Claude Code, a Codex and eventually a Cognition – capable of doing hours’ worth of human work independently. And now full-blown autonomous systems of work (Blitzy, Factory, etc.) that can ingest hundreds of millions of lines of code, understand objectives, and independently ideate, create, and deliver solutions over weeks of autonomous work. In fact, very early signs of recursive superintelligence are already appearing, 

The evolution of the coding vertical is unlikely to be unique. Most, if not all, verticals will follow a similar trajectory. AI doctors and lawyers will deliver autonomous value superior to any single human being. They might come from companies that don’t exist today, or perhaps some of the best aforementioned productivity tools will use their head start, i.e. proprietary data sets and embedded workflow, to evolve into these. 

Northzone’s investments in companies like Tandem Health are already showing this evolution from productivity tool to a true system of action. Others, like XBOW or Blitzy, are true autonomous systems of work, from day one.

So, a few will survive (and thrive) – the rest will perish. 

Where the world is headed

This doesn’t mean we stop funding productivity tools altogether. It does mean that we only focus on those that are creating meaningful new value for the world. 

If the last 24 months of AI were defined by efficiency and productivity increases, the next 12 will be defined by innovation. We’ll likely see a lot more investment behind AI for science – fueling the discovery of new drugs and materials. We’ll see the world become safer for the vast majority of the population (despite the feeling of the converse) through autonomous AI for Defense. Physical AI might be larger than all of Digital AI put together, and will have a lasting impact on human behavior like no other.

By definition, innovation is almost impossible to predict precisely, so perhaps the most meaningful to come is beyond those listed here. At Northzone, we spent almost two years examining what a truly autonomous system of work would look like. And for more than a year, we sat on this (then-) contrarian thesis, not actively deploying capital, even as productivity tools drew vast sums of it. The technology just didn’t exist.

But since the beginning of 2026, we have actively led rounds in excess of several hundreds of millions of dollars, as a convergence of vast foundational intelligence, deep reasoning, and early recursive learning loops saw the arrival of these systems, capable of acting autonomously over long horizons, without being told what to do next. A tool that requires human supervision simply cannot compete with a product that completes months of work in a weekend.

Crudely defined, AGI is the ability of AI to navigate ambiguity, form hypotheses, test them, hit dead ends, iterate to find a solution, execute and deliver value, all without any human intervention. That is the next frontier, and the new standard for investment.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

This story was originally featured on Fortune.com

Mark Carney drew international attention as Canada’s prime minister by warning that middle powers must resist economic coercion by more powerful countries. Now President Donald Trump is putting that warning to the test with sweeping new tariffs that could show how much economic pain Canada can absorb.

Tensions escalated late Friday when Canada walked away from negotiations after Carney concluded the United States was demanding too much in exchange for tariff relief. The U.S. imposed 50% duties Saturday on about $20 billion worth of Canadian goods, and Carney announced dollar-for-dollar retaliation beginning Sept. 8.

“We’re going to hit back,” Carney said.

Carney is doing what many other American allies have so far avoided: risking economic pain rather than yielding to tariff pressure.

For Carney, the showdown is the clearest test yet of his argument that middle powers must stand up to economic pressure from great powers such as the United States and China, even when it comes at a cost. Canada’s response could show how countries navigate a world in which long-standing alliances offer less protection and economic ties themselves become sources of leverage.

It could also shape how Carney is viewed at home and abroad, and how other U.S. allies respond to the Republican president.

The trade dispute also has become a test of sovereignty.

Carney said Washington introduced language in the final hours of negotiations that would have restricted Canada’s ability to make trade deals with other countries. He said that demand was “unacceptable” and “a question of sovereignty.”

British Columbia Premier David Eby said accepting such a condition would have reduced Canada “to the economic equivalent of the 51st state” — a status Trump has mused about often.

Canada becomes a test case for the world Carney warned about

Carney’s message resonated in January when he addressed the World Economic Forum in Davos, Switzerland, as Europe braced for Trump’s threats over Greenland and new tariffs.

Carney said the international order was undergoing “a rupture, not a transition.” He argued that sovereignty would depend increasingly on a country’s ability to “withstand pressure” and warned that middle powers negotiating alone with great powers do so from weakness.

Trump responded a day later by stressing Canada’s dependence on the United States. “ Canada lives because of the United States,” he said. “Remember that, Mark, the next time you make your statements.”

The president has repeatedly talked about making Canada the 51st U.S. state and dismissed the allies’ border as artificial. On Sunday, Trump returned to that theme, writing on Truth Social that “Canada wants the benefits of being a State, without being one!!!” and accusing Canada of charging U.S. farmers “massive amounts” of tariffs for years. “No more!!!” he wrote.

Seven months since Davos, Canada has become a test case for the world Carney described.

“Our government understood, before many, that America would transform all its commercial relationships,” Carney said Saturday. He accused Washington of using “economic integration as a weapon” and said its “signature was written in pencil.”

The price of resistance and will Canada show the way?

Historian Robert Bothwell said Canada is uniquely vulnerable to U.S. pressure.

“No country is more exposed than Canada,” Bothwell said. “Other countries have to fear American misbehavior, but none as much as Canada.”

Bothwell said success ultimately means Canada retaining its independence “in the face of Trump’s desire to subordinate it and absorb it.” He said Carney “sees that very well.”

But Canada’s dependence on the U.S. market makes that difficult.

Nearly three-quarters of Canadian goods exports go to the United States, whose economy is roughly 10 times larger. Canada can sign new trade agreements, but replacing customers and supply chains built around the enormous U.S. market over decades is considerably harder.

Carney acknowledged retaliation would “raise costs and reduce choice for Canadians.”

U.S. Trade Representative Jamieson Greer rejected Canada’s account of the breakdown in talks, saying Ottawa introduced new demands and backed away from commitments even after Washington offered to reduce tariffs on steel, autos, lumber and other goods.

He said the United States was moving ahead with additional measures in response to Canada’s retaliation, raising the prospect of further escalation.

The European Union prepared retaliatory tariffs against the United States last year but repeatedly suspended them while negotiating with Washington.

Nelson Wiseman, a professor emeritus of political science at the University of Toronto, said Canada is providing the biggest test yet of whether Carney’s strategy can work and whether resistance by one middle power could change the calculations of others.

“Will there be a domino effect? We’ll see,” Wiseman said.

Carney tries to hold the line as anger grows among Canadians toward Trump

Ian Bremmer, president of the Eurasia Group, said Americans underestimate how angry Canadians are with the Trump administration.

“Taking a hard line in response to U.S. policy perceived as predatory — even with major economic cost to Canada — is popular among most Canadians,” he said in a social media post.

Manitoba Premier Wab Kinew said Canadians should be prepared for a prolonged confrontation and that Trump could emerge weaker after the U.S. midterm elections in November.

“He’s got two more years left in office. We should be prepared to duke it out for two years, and then hopefully, sanity will return,” Kinew said.

Carney has framed the confrontation as a test of whether Canada can preserve its independence under U.S. pressure.

“Last spring, I warned that America is trying to break us so that they can own us,” Carney said Saturday. “And I promised: ‘That will never, ever happen.’ We are keeping that promise.”

This story was originally featured on Fortune.com

The CEO of a Chinese robotics company whose stock skyrocketed 460% after going public this week said humanoid robots might still be far away from their own “ChatGPT moment.”

The 36-year-old CEO behind robotics company Unitree, Wang Xingxing, said Thursday the industry’s breakthrough, or “ChatGPT moment,” could take “2 to 3 years at the fastest, and 5 or even 10 years at the slowest,” according to a translation of a speech he gave at the World Robot Conference in Beijing, previously reported by CNBC.

Robots will only reach this point when they can be placed in an unfamiliar environment or a home and handle about 80% of tasks through voice commands or text alone, he said.

Wang’s comments reflect a shift from last year at the same conference, when he said the breakthrough moment for robotics would come within five years at the latest. His statement also seemed to conflict with the outsized enthusiasm shown by investors who skyrocketed the company’s stock 460% on Wednesday when it listed on Shanghai’s STAR Market for the first time.

Despite having been founded by Wang a decade ago, Unitree became a household name in the robotics industry overnight last year after a viral video showed the company’s humanoid robots performing a coordinated dance alongside humans during the Spring Festival Gala broadcast on China’s state TV.

Less than a month later, Wang was one of only a handful of executives seated in the front row, alongside BYD chairman Wang Chuanfu and Huawei founder Ren Zhengfei, during a private enterprise symposium hosted by China’s president, Xi Jinping in Beijing. 

“Artificial-intelligence-driven robots are evolving at an incredibly fast pace, surpassing my expectations. Every day brings new surprises,” Wang told China state TV following the meeting, the South China Morning Post reported.

Fast forward to this year’s Spring Festival Gala, and Unitree again impressed the crowd with its robots’ more advanced moves that included backflips and leaps over platforms.  

These feats culminated in Unitree’s exuberant public listing this week, in which it raised $900 million at a valuation of $9 billion. After trading opened, Unitree reached a valuation of $66 billion, dwarfing U.S.-based robotics company Figure AI, which was last valued at $39 billion after a funding round last year.

After a stellar first day of trading, which Fortune previously reported is not unusual in China because regulators tend to keep IPO valuations conservative to protect investors, Unitree’s stock fell about 19% on Thursday. Its stock closed down another 2% Friday as of market close in Shanghai.

Just because Unitree’s robots can perform impressive feats doesn’t mean the company is on the verge of ushering in a humanoid robot revolution. While ChatGPT’s release in late 2022, helped spark a flurry of competition and advances for large language models, the same idea isn’t easily applied to robots because of their complexity.

Wang admitted in the same speech Thursday that Unitree’s robots are still less efficient than human workers and must be retrained for every new task. The fact that robots still cannot adapt to new situations and tasks easily is holding back the robotics industry, he added. 

Still, Wang noted that the company is working on a self-evolving development loop where its AI tests a robot’s “control code” and continuously scores its results in collaboration with humans to help improve and ultimately perfect the precision of its robots’ movements, which he said can go awry in “the last few centimeters or millimeters.”

This story was originally featured on Fortune.com

The U.S. national debt crossed $40 trillion for the first time this week, but Treasury Secretary Scott Bessent wants Americans—and markets—to shrug it off.

“There’s nothing magic about the $40 trillion number,” Bessent told CNBC‘s Sara Eisen in an exclusive interview on Squawk on the Street Thursday. “And we can grow our way out of that.”

The remark, delivered with the same even cadence he’s used to talk down bond-market jitters all year, was Bessent’s clearest attempt yet to reframe a debt milestone that has alarmed economists and fueled a selloff in long-dated Treasurys. The gross national debt crossed the $40 trillion mark, according to Treasury Department data, just five months after hitting $39 trillion in March.

Bessent’s comments came a day after the Treasury said it would at least double the size of its buyback operations for longer-dated securities—from a maximum of $2 billion per operation to “at least” $4 billion—in a bid to shore up liquidity in a bond market he described as thinly traded and, in his view, mispriced. The change takes effect Sept. 9 and applies through Nov. 4, covering the 10-to-20-year and 20-to-30-year sectors that have faced what CNBC has called a “buyers’ strike” since late June.

“We believe that there are many underlying factors in turn that the market is not looking at, and we are going to make a market… in these,” Bessent said. “I would note that it could be more than the $4 billion per issue.”

The fundamentals argument

Bessent’s core pitch is the deficit is smaller than it looks, and the money the government is “losing” isn’t being lost at all. He said the U.S. ran a fiscal consolidation in calendar year 2025, with the deficit landing around 5.7% of GDP. Part of what has inflated the headline deficit, he argued, are one-time tariff refunds that won’t recur: 2026 tariff income, he said, should roughly match 2025 levels as U.S. Trade Representative Jamieson Greer reimplements duties through the Section 301 process.

The other major drag on revenue, he said, is the cost of letting companies immediately expense new factories, equipment, and farm structures. Bessent said he doesn’t count that as spending.

“That is actually an investment in the future and we’re increasing the tax base,” he said. “That is what measures the wealth of a nation … the ability to increase after-tax return on capital.”

He described the strategy in physical terms: “Think of it as pulling back the slingshot here. We have a lot of potential energy that will turn into kinetic energy during this year, next year, as these factories come online.”

Asked directly whether the administration believes it has already seen the worst of the deficit, Bessent didn’t hedge.

“I think the very, very good chance we have,” he said, pointing to a coming joint effort with OMB Director Russell Vought and a separate crackdown led by the vice president’s Fraud Task Force that he said could “save several hundred billion dollars.”

He also teased a broader fiscal-consolidation announcement from the White House “probably at the end of this week, beginning of next week,” covering both spending cuts and revenue measures.

The deficit question

Fortune reported earlier this month Bessent has leaned unusually hard on short-term Treasury bills to finance the roughly $2 trillion annual deficit, taking advantage of a 3.8% three-month bill yield versus a 30-year rate that has traded above 5%—a multi-decade high. That approach holds down reported borrowing costs today, but leaves the government more exposed if inflation or rates rise, according to minutes from the Treasury Borrowing Advisory Committee (TBAC), the panel of bond dealers and investors that advise Treasury on its own funding.

Those same TBAC minutes, released Aug. 5, warned that at current auction sizes, the government faces a $1.45 trillion funding shortfall in fiscal years 2027-28. Rising interest costs already drove the biggest jump in Treasury outlays this year—up $120 billion—and the government now spends more than $1 trillion annually just servicing debt, more than the U.S. spends on national defense.

Jon Hilsenrath, the longtime Federal Reserve watcher who spent decades at The Wall Street Journal and now runs Serpa Pinto Advisory, previously told Fortune he sees a collision brewing between the Treasury’s bill-heavy strategy and the Fed’s own moves under new Chair Kevin Warsh to shrink its balance sheet—which dealers expect to push the Fed toward shorter maturities just as Treasury is forced back toward longer-term bonds to refinance.

“It always comes back to fundamentals,” Hilsenrath said. “Trump and a new Congress came into power and chose not to do anything about the deficit.”

Notably, the strategy predates Bessent. It was his predecessor, Janet Yellen, who first leaned on short-term bills to fund deficits—a tactic Bessent himself criticized in 2024, when he amplified an analysis by economists Stephen Miran and Nouriel Roubini accusing Yellen’s Treasury of “activist Treasury issuance” designed to flatter the economy ahead of the election.

Skepticism from the bond market

Eisen pressed Bessent on whether the buyback signal was more theater than substance, noting Wednesday’s Treasury rally—yields fell as much as 9 basis points on the 30-year bond after the buyback news—had already partly reversed by Thursday morning. Bessent didn’t back down from the possibility of going further.

“We have a big toolkit, so we will see,” he said, though he insisted the moves aren’t a response to any particular yield level. “It’s not if the market cooperates. It’s: we will see what the conditions are, and we will analyze them then.”

He also dismissed the idea the buyback push constrains Warsh, who has signaled openness to shrinking the Fed’s balance sheet or raising rates if inflation stays elevated.

“I think that the Treasury and the Fed would work together if there was any change in the balance sheet,” Bessent said, adding the buyback decision “has nothing to do” with the rate outlook.

Inflation, jobs, and the dollar

Bessent argued headline inflation—pushed higher recently by Brent crude near $94 a barrel amid the ongoing conflict with Iran—is masking a friendlier underlying picture. He pointed to slower wage growth in hospitality, gains for the bottom 25% of earners, and what he called the “biggest decrease in pharma prices” on record.

“The core inflation is down,” he said. “We aren’t seeing anything that says that the second-order effects are spilling over into core inflation.”

On the labor market, where a soft jobs report last month stoked concern about cracks in the economy, Bessent called the data “quite noisy” and credited tighter immigration enforcement for reducing the number of jobs the economy needs to create. He pointed to manufacturing and construction employment at 15-year highs.

He also waved off recent dollar weakness.

“The U.S. is a big service economy. We don’t respond to the trade-weighted dollar,” he said, describing the greenback as “very, very stable” against top trading partners Canada and Mexico and insisting the administration maintains “a strong dollar policy.”

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.

This story was originally featured on Fortune.com

The net worths of CEOs and founders are largely at the whim of their company stock—all it takes is one breakout earnings report or blockbuster news to shake up their fortunes. Now, Moderna cofounder Robert Langer has re-entered the billionaires club following promising cancer vaccine trials that sent the company’s stock soaring. 

Langer, known as the “Edison of Medicine,” witnessed his equity in the biotech business double in value, shooting his net worth up to roughly $1.7 billion, according to a Forbes analysis. 

His wealth surge followed the news this Wednesday that Moderna and pharmaceutical company Merck’s mRNA cancer vaccine hit its goals in a Phase 3 trial targeting melanoma. The announcement sent Modern’s stock soaring more than 100%, valuing Langer’s roughly 3% stake past the billion-dollar threshold—a massive jump from the roughly $730 million he boasted on Tuesday.

This is the second time that Langer has made it to the billionaires club. Langer first came into 10-figure wealth back in November 2020, when Moderna shares surged after the company reported promising Phase 3 results for its COVID-19 vaccine. During the pandemic-era Moderna boom, Forbes even put his net worth as high as $4.9 billion in 2021, before plunging and knocking him out of the club. 

The 77-year-old cofounder’s stake was estimated to be just $343 million when Modern’s shares were at a rock-bottom low of $29.81 in early January. Now, he’s back in the ultra-rich club again—but still urges young workers to prioritize meaningful work over money and job security.

“What you want is somebody to have a great career and be happy,” Langer said in an interview with Big Think in 2018. “So my advice to students is don’t do what’s going to make you the most money or the most security, but do something that will make you happy, whatever that is.”

Fortune reached out to Moderna for comment.

Langer turned down 20 job offers to chase his dreams—he advises workers not to ‘give up too easily’

Langer’s major piece of advice to young workers is to be “broad and open-minded” when it comes to their careers. 

After all, the billionaire founder lived a whirlwind of a career, turning down lucrative job offers and weathering professional rejection before ultimately launching one of the world’s biggest biotech companies.

Langer developed his love for science while studying chemical engineering at Cornell University, later obtaining his doctorate at MIT in 1974. And upon graduating, the budding biotech pioneer was flooded with job offers. At that time the U.S. was reeling from a gas shortage, and oil companies were looking to lock down talent like Langer and his chemical engineer classmates. 

Nearly all of his peers took them up on the “very high-paying jobs,” Langer explained, but he was determined to make a different impact. One job recruiter told him that if he could increase the yield on one petrochemical by 0.1%, that gain would be worth billions of dollars. But he wasn’t sold on improving oil margins for the rest of his life. 

“I did get 20 job interviews from these companies, and I got 20 offers too, but I wasn’t very excited about doing that,” Langer said in the Big Think interview. “I just wasn’t excited about the impact that that would have, and I kept looking for ways where I guess I felt I could have more of an impact on the world.”

Even after turning down 20 high-paying job offers, Langer was met with rejection

Turning down those high-paying oil jobs, Langer chose a different path, joining Judah Folkman’s lab at Boston Children’s Hospital as a postdoctoral researcher. During his three-year stint he worked on ways to efficiently deliver drugs, developing a polymer matrix system for delivering large molecules like proteins into cells. The science was so new that Langer said the scientific community couldn’t believe it—and it even resulted in career roadblocks. His first nine grants were rejected, and when he went job-hunting, “no chemical engineering department in the world” would hire him.

“I ended up going into a nutrition department, but the problem there was that the people in that department didn’t think very much of what I was doing, and they basically told me I should start looking for another job,” Langer recounted. “So it was not very pleasant in the beginning. I think if I’d moved away from it, I don’t know what would have happened.”

Langer did end up snagging a faculty role at alma mater MIT in 1978, and went on to build the largest biomedical engineering lab in the world. And his most notable career break didn’t come until he was in his 60s; in 2010 he cofounded Moderna, transitioning his decorated academic career into launching a billion-dollar biotech company. Now, the $56 billion company has been credited with developing one of the first successful mRNA (COVID-19) vaccines, and is making headway with its melanoma trials. Langer says his journey required some trade-offs, but advises young professionals to stay on course to lead a fulfilling career like his own.

“If you give up too easily, that’s not good. Obviously, you don’t want to keep banging your head against the wall forever, so I think there’s some compromises you have to make,” the Moderna cofounder said. “But I think if I gave up on something like that, maybe I’d give up on other things that were important, too. I just don’t know. I’m glad I didn’t.”

This story was originally featured on Fortune.com

The American Dream has typically looked something like this: A steady job, a shiny new set of keys to a first home, marriage, two kids (and maybe a dog), all while building wealth along the way. For generations, that’s been the familiar “white-picket fence” picture of making it in America.

But that has run smack into “the great postponement,” an affordability crisis and economic stagnation that haven’t been seen in many years. Some of the younger generation’s response to these factors has been caricatured as “financial nihilism,” but young adults are still by and large hitting the same milestones their parents did, just in a different sequence, in a different timeline and often with different tools. It’s a more improvisational shot at the American Dream, because it has to be.

Young Americans have spent years watching home prices climb out of reach, while marriage and children are happening later and the traditional career ladder has become less predictable. But that doesn’t necessarily mean they’ve given up on the milestones generations before them chased. Instead, some are finding workarounds: buying homes that need work, renovating them piece by piece, earning money outside a traditional 9-to-5 and worrying less about doing any of it in the order they were supposed to.

And despite all the talk of Gen Z’s financial nihilism, many remain surprisingly optimistic. Nearly two-thirds of Gen Z adults say their generation faces tougher economic circumstances than previous generations, according to a nationally representative Urban Institute survey published in July. However, 56% still expect their personal financial situation to improve within the next year, and 42% think they’ll eventually be financially better off than their parents.

“They’re not just postponing life markers,” said Susan Wachter, a professor of real estate and finance at the University of Pennsylvania’s Wharton School, who has argued that this era amounts to a “great postponement”. Of Gen Z, she told Fortune,”They’re also taking a different path.”

To Wachter, the changes showing up in where young adults live, how they work and when they start families aren’t isolated trends. They’re different responses to the same economic constraints reshaping early adulthood.

Wachter said the economic world facing young people today looks dramatically different from the one their parents, and even some of their older siblings, entered. Housing affordability is a major part of it, but its effects extend well beyond whether someone can scrape together a down payment.

“We’ve not seen challenges in terms of affordability like this in more than a generation,” Wachter said.

The starter home isn’t so ‘turnkey’ anymore

Between 2019 and 2024, the inflation-adjusted median U.S. home value jumped 30%, from $269,600 to $350,000, according to Pew Research Center. Over the same period, inflation-adjusted median household income for households headed by someone under 40 increased just 9%.

The squeeze has dramatically changed who can afford to buy. In 2019, 56% of renter households under 40 earned enough to afford the monthly cost of owning a home. By 2024, just 37% did. And 89% of adults under 40 now say buying a home is harder for young adults than it was for their parents’ generation.

For young adults who do manage to break into the housing market, getting the keys may increasingly be just the beginning of the work.

Wachter said some young buyers are overcoming high housing costs by looking at older homes and fixer-uppers, putting their own time and labor into improvements or even renting out part of the property to help cover costs.

Those workarounds require “time, effort, and often creativity,” she said, and sometimes “an element of entrepreneurship.”

There’s plenty of evidence aspiring homeowners are willing to make those tradeoffs. Half of Americans planning to buy their first home in 2026 said they would feel comfortable buying a fixer-upper, according to a TD Bank survey of more than 1,000 prospective first-time buyers published in May. And despite the affordability crunch, 81% said they were optimistic about the housing market and the same share still considered homeownership a smart long-term investment.

The shift toward smaller projects is showing up at the country’s largest home-improvement retailer. Home Depot said this week that customers continued to spend on smaller repair and maintenance projects in its second quarter, even as housing affordability weighed on demand for larger renovations. The company said housing turnover remains at historically low levels, with no clear inflection point yet in sight.

Taskrabbit is seeing a version of that willingness to compromise play out among its customers.

As housing has become harder to afford, Chris Ager, Taskrabbit’s chief commercial officer, said the company is seeing younger customers take on smaller homes or properties that need more work rather than move farther away.

“Particularly younger generations are making the decision to optimize for location over perfection,” Ager told Fortune.

Once they’re in, the compromises continue. Customers are increasingly tackling renovations gradually rather than handing an entire project to a contractor.

“There isn’t the budget to do it all at once,” Ager said.

Instead, Ager said TaskRabbit is seeing clients renovate one room at a time, doing some of the work themselves and bringing in Taskers to handle other pieces as their budgets allow.

The shift is showing up in what people need help with, too. Furniture assembly, mounting, moving and cleaning are among TaskRabbit’s biggest categories, but yard work and outdoor maintenance is one of its fastest-growing categories this year, up roughly 40% year over year, according to Ager.

For a generation entering a housing market where the typical first-time buyer is now 40, those compromises offer one way around an affordability problem that isn’t going away quickly. Even prospective Gen Z buyers are still aiming considerably younger: 46% surveyed by TD said they expected to purchase their first home between ages 25 and 29.

The corporate ladder isn’t the only way up

Work is becoming less linear, too.

For many young workers, one paycheck is no longer the only way they earn. About 43% of Gen Z adults ages 18 to 29 report having a side hustle, according to a 2026 LendingTree survey. Gig and on-demand work, including food and grocery delivery, ridesharing, babysitting and pet sitting, was the most common form of side work among respondents.

Side hustles aren’t necessarily replacing traditional employment. For some, they’re another way to earn alongside it.

TaskRabbit is seeing its own version of that more flexible approach to work. The platform has Taskers who effectively use it as their full-time source of income, Ager said, alongside others who pick up jobs to fill gaps in their income or schedules while pursuing something else.

The company sees a bump in younger applicants each summer, he said, including people using TaskRabbit alongside school, part-time work or other pursuits.

“I think what we see in the Gen Z community is just a desire to have more non-traditional career paths,” Ager said. For some, the goal isn’t necessarily to leave a traditional career behind but to also have more than one way to earn.

And as artificial intelligence raises questions about the future of entry-level work, TaskRabbit occupies an unusual corner of the labor market. AI might help match a customer with the right person or better define a job before someone arrives, Ager said. It still can’t carry a couch up four flights of stairs or repaint a bedroom.

TaskRabbit sees its business as “pretty AI-resilient.”

“At the end of the day, those problems are going to be solved by two humans getting together to do the work,” said Ager.

The platform offers a window into how earning a living can increasingly be assembled from different sources rather than tied entirely to one employer.

Life doesn’t have to happen in order

Housing and work aren’t the only pieces moving around. Wachter’s research has found evidence connecting housing affordability with young adults remaining with their parents longer and postponing household formation, marriage and children.

For some, family wealth provides another route around the affordability problem. Parents who can afford to do so are helping adult children with down payments or giving them somewhere to live while they save, Wachter said.

That help is already built into the expectations of many would-be homeowners. Two-thirds of prospective first-time buyers surveyed by TD said they were receiving or expected to receive financial support from family or loved ones. Among Gen Z respondents, that figure climbed to 70%.

But that solution isn’t available to everyone. A parent’s home may not be near a strong job market, may not have room for an adult child, or the family may simply not have the wealth to provide a down payment.

For Wachter, those constraints help explain why the traditional sequence of adulthood is breaking apart. Young people are investing in financial assets, businesses and themselves while taking advantage of choices that weren’t always available to previous generations.

The bigger change may be the assumption that any of those milestones have to happen in a prescribed order.

“I do think this is the new normal,” Wachter said.

The American Dream hasn’t necessarily lost the house, financial independence, fulfilling work, marriage or children. But the step-by-step instructions that once came with it are becoming easier to ignore.

“It’s not a settled step-by-step pattern going through the march to adulthood markers that we’ve seen in the past,” Wachter said. “I think that’s a permanent shift.”

This story was originally featured on Fortune.com

Some successful entrepreneurs sitting atop billion-dollar businesses say they may look rich on paper, but take a peek into their bank accounts, and they’re actually cash poor. Social media mogul Jimmy Donaldson, known to his 514 million YouTube subscribers as MrBeast, claims he’s just as broke as everyone else despite running a $5 billion entertainment empire. 

“I’m borrowing money. That’s how little money I have,” Donaldson told the Wall Street Journal earlier this year. “Technically, everyone watching this video has more money than me in their bank account if you subtract the equity value of my company, which doesn’t buy me McDonald’s in the morning.”

The 28-year-old entrepreneur has said he keeps less than $1 million for himself, despite being a billionaire and owning more than half of his $5 billion company Beast Industries. Aside from his nine-figure Amazon deal and popular YouTube channel with 137.5 billion lifetime views, Donaldson hit the ultra-rich club—at least on paper—from a slew of successful businesses. He’s launched ventures including multimillion-dollar chocolate brand Feastables; Lunchly, a Lunchables-esque packaged food product; MrBeast Burger, a virtual restaurant that only allows for pickup and drop-off; and production company MrBeast LLC, which helps manufacture his viral videos.

Through his assets, Donaldson is projected to be worth at least $2.6 billion—although he emphasized it’s not a fat wad of cash burning a hole in his pocket. Forbes has also estimated his annual earnings reached $85 million between April 2024 and April 2025, a far cry from the typical American salary of $64,220 a year. However, that doesn’t mean he’s splurging on luxuries and only flying private. Donaldson claimed he’s actually in the red.

“It’s funny talking about my personal finances, because no one ever believes anything I say,” Donaldson explained. “They’re like, ‘You’re a billionaire!’ I’m like, ‘That’s net worth.’ I have negative money right now.”

“I wake up, I just work…I’m just so busy working I don’t really think about my personal bank account,” Donaldson continued. “I’m just laser-focused on making the greatest videos as possible, and building the business as big as possible.”

Why MrBeast says he’s in the red

Donaldson rakes in eight-figure earnings and runs a $5 billion business, yet still claims to be broke. So where is all of his money going? Right back into his business ventures, the YouTube star said. 

“I personally have very little money because I reinvest everything (I think this year we’ll spend around a quarter of a billion on content). Ironically I’m actually borrowing $ from my mom to pay for my upcoming wedding,” Donaldson wrote on X in response to a post heralding him as the only billionaire under 30 who didn’t inherit their wealth. 

“But sure, on paper the businesses I own are worth a lot,” he continued. 

The billionaire entrepreneurs who say they’re broke—or act like it

Other billionaire founders have echoed that they don’t feel as wealthy as their net worth suggests. Ben Francis, the founder and CEO of sportswear brand Gymshark, insisted his $1.3 billion net worth is “all on paper,” and that his wealth isn’t a “real” marker of success.

“People assume there is some bank balance with my name on it that has billions in which is just completely untrue,” Francis said on The SuperPower Podcast in 2023. “None of it is real.”

After all, it only takes one negative earnings report or fierce new industry competitor to jolt his net worth. Since Francis owns 70% of the company, his fortune is wrapped up in the success of his assets—which can fluctuate in value at any given moment. 

“It could double, it could [halve],” the Gymshark founder continued. “That’s why I think it’s important that no individual should ever pin their self-worth on things like wealth, net worth, or anything financial.”

Even the billionaires who do have cash to burn are just skirting by, out of choice. Lucy Guo, the cofounder of $29 million company Scale AI, isn’t keen to spend the $1.3 billion stake she has in the business. The youngest self-made billionaire woman in the world doesn’t like to “waste” money, opting to fly commercial, drive an old Honda Civic, wear Shein clothes, and leverage meal deals to get the best price. In fact, she believes flashing wealth and needlessly splurging on life luxuries is a sign of insecurity; Guo doesn’t feel the need to prove she’s successful. 

“Who you see typically wasting money on designer clothes, a nice car, et cetera, they’re technically in the millionaire range,” Guo told Fortune last year. “It’s like, act broke, stay rich.”

A version of this story was published on Fortune.com on January 13, 2026.

This story was originally featured on Fortune.com