Business

1. Trump’s 100-day economy
2. Glass Lewis’ political pivot
3. Margin Call’s lasting appeal
4. Group chats run America
5. China’s Yankee swap
6. A big insurance LBO

At Semafor’s World Economy Summit last week, Carlyle co-founder David Rubenstein shared a story from his time in the Carter administration about a staffer who had warned of a recession during a White House briefing: “Carter hauled him into the Oval Office and said, ‘Do not use the R Word. It scares people.’ … So from then on, he said, ‘I think we’re heading into a banana.’”

“I would say at some point there will be a banana this year,” Rubenstein said, adding that he was “amazed” at “how many business leaders are sounding alarms who I speak to privately and who won’t say a word.”

With notable exceptions like Rubenstein and Ken Griffin, who said the US had “devolved into a nonsensical place,” executives are talking in maddening euphemisms. They talk about the “resilience” of the American consumer. Those willing to acknowledge the obvious use words like “potential softening of demand.” Some won’t say “tariff” at all. Officials at the Federal Reserve (rightly, a more buttoned-up bunch) have tied themselves in linguistic knots to avoid saying the S Word.

The gap between private discourse and public comments is wider than I’ve ever seen it. This is understandable to some degree, but risks a credibility gap that companies and institutions already low on public trust can’t afford. Consumer sentiment is awful and getting worse, and while it may take time to show up in the real economy, tunes need to change quickly.

Here’s another economic indicator to watch: We’re writing about Margin Call! Sometimes journalism is about chasing hard stories and getting yelled at. But sometimes it’s an excuse to call up people you admire. Semafor’s Editor-In-Chief Ben Smith and I have been swapping clips over the past few weeks from the movie about the 2008 financial crisis, and marveling at its relevance today. So we talked to JC Chandor, who wrote it.

Plus: a leading proxy advisor’s political pivot, a big LBO heads toward the finish line, and Ben’s must-read on the group chats running America (Scoop count: 4). And Rohan is in London through Wednesday and Paris afterwards this week — every man to his duty — so shoot him a note if he should come say hi.

Trump’s 100-day economy

Sunday marked the 100th day of Donald Trump’s second term, an arbitrary but politically significant check-in mark. The economic upshot: not good, and likely to get worse before it gets better.

One problem is that we’re in a data black hole. Companies are reporting earnings for the three-month period that ended just before “Liberation Day,” and the latest unemployment figures just missed capturing DOGE’s big federal layoffs. That leaves economists sorting through forward-looking data like consumer sentiment (awful), CEO sentiment (also awful), real-time spending data (mixed), and corporate outlooks (mixed to bad). The S&P 500 had its worst first 100 days of any administration since Gerald Ford, who took over during the Watergate malaise and an Arab oil embargo.

General Motors and UPS are the latest companies to withdraw their 2025 profit projections, joining Walmart, American Airlines, and other consumer canaries. United Airlines CEO Scott Kirby told me last week that travelers were still booking summer vacations, “but that more discretionary [spending] — ‘We don’t have anything going on next weekend, let’s head down to the Bahamas’ — they’re pulling back from that… I think that’s probably true across the economy.”

Consumer sentiment now sits at its lowest level since July 2022, when inflation was surging, and at its second-lowest point since the University of Michigan first began to survey it in 1952.

The 30,000-foot view is a bit of a choose-your-own-adventure. Goldman Sachs’ index of financial conditions — a measure of how easily companies and individuals can borrow, invest, and transact — has returned to its pre-Liberation Day levels. The Fed’s version, on a one-week lag, has not. The bond market, whose freakout, you will remember, set off widespread panic last month, has settled but not forgotten: Investors are still charging Washington a higher interest rate to borrow.

What to watch: First-quarter US GDP data will be out Wednesday. Harvard economist Jason Furman’s advice is to separate the signal from the noise: Strip out exports, government spending, and inventories bulged by pre-tariff hoarding. Tired: Core inflation. Wired: “Core GDP.”

Glass Lewis plans political pivot as Republicans zero in

​​For years, two firms have dominated the business of telling investors how to vote in corporate elections. Now, Glass Lewis, the scrappier and smaller of the two, wants out. It’s discussing ditching its “house views” on ballot measures ranging from hostile takeovers to complaints about gender balance and carbon emissions, Semafor scoops this morning.

Glass Lewis has in recent years pushed McDonald’s to audit its racial diversity, nudged Starbucks to produce an independent assessment of its labor practices, and urged meatpacker Tyson to disclose its political contributions. It also recommended that shareholders reject Jamie Dimon’s $53 million bonus in 2022, which earned it the unending ire, vented in a recent interview with Semafor, of the JPMorgan chief. (ISS on Monday recommended that BlackRock shareholders vote down CEO Larry Fink’s $30 million-plus pay package. Staying in the do-this-not-that business will put a bigger target on ISS’ back, though conservatives are unlikely to defend Fink’s bonus.)

But under conservative pressure and a new CEO, Glass Lewis is following other financial players out of the moralizing business. The most visible backpedaling is at BlackRock, which retreated from its progressive push of the late 2010s under a hail of arrows. Instead, Glass Lewis will focus on its business that helps investors develop custom voting policies — a higher-margin business anyway, and one that generates less outrage.

Just in time: House Republicans will hold a hearing at 2 pm today titled “Exposing the Proxy Advisory Cartel.”

Why is Margin Call still so good?

Call it the Margin Call Index: Social-media mentions (and, presumably, Amazon Prime’s secret streaming numbers) for the 2011 film serve as a shadow fear barometer for Wall Street, which has spiked since Trump took office again. Close to a million people have watched it in unlicensed 30-second installments. There is, of course, a Jeremy Irons meme generator (IYKYK). The story of the near-collapse of an unnamed investment bank in 2008 has been remarkably timeless, a more durable and morally ambiguous sibling to 2015’s The Big Short. We wanted to know how the writer, JC Chandor, who had never made a big-screen movie before, got it so right — and what he makes of its staying power. So we called him.

Group chats run America now

Ben Smith’s big story on Sunday about the conservative group chats shaping American political discourse is riveting. These threads, most of which center around a16z’s Marc Andreessen (“how does he have the time?” marvels one participant, a common question for today’s tech oligarchs) are the “single most important place in which a stunning realignment toward Donald Trump was shaped and negotiated, and an alliance between Silicon Valley and the new right formed,” Ben writes.

It’s as much a story about the business of media as it is about the politics of tech. “The internet has fragmented,” Substacker Noah Smith wrote in response to the story. “Group chats are now where everything important and interesting happens.” (The left has its own group-chat drama, as Noah found.) New media models — or, more accurately, the accelerating failure of old ones — plus a retreat to “safe spaces,” which conservatives mock liberals for but also seem to crave, is reshaping politics.

Wall Street learned its lesson about group chats. Will Silicon Valley feel similarly burned? And as always, if you have more screenshots, you know where to find us.

China sees yuan opening as Trump dings dollar

No, the yuan is not going to dethrone the dollar anytime soon, but China sees Trump’s chaos as an opportunity to embed its currency deeper into the global financial system. UnionPay, the government-controlled financial firm, has strengthened its payments network across Southeast Asia in recent weeks, Reuters reports. And Beijing continues to add swap lines with other central banks — essentially making China the lender of last resort in countries that might otherwise turn to long-established financial links with the Fed.

China has a record $590 billion in direct lending lines to more than 40 countries, versus 175 for the Fed. For now, these function more like untapped credit-card limits, with only sporadic borrowing by countries like Argentina, but they show that China is positioned to benefit from global investors’ declining faith in the dollar.

Bidders circle Brighthouse

Private-equity firms are circling life insurer Brighthouse Financial in what could be a $9 billion takeover. Sixth Street and Carlyle submitted a joint bid for the company, one of the largest US specialty insurers, people familiar with the matter said. And offers are on the table from TPG, Apollo, Nippon-owned Resolution Life, Jackson Financial, and Aquarian Holdings, which has backing from RedBird Capital.

Life insurance is now, improbably, the bleeding edge of finance. Customers’ premiums are a juicy source of cash for private investment firms — easier and cheaper to gather than traditional funds, and not owed back to their policyholders for decades. TPG is among the few big buyout shops without its own insurance arm, while Carlyle’s is smaller than those of KKR, Blackstone, and Apollo. The bidders either declined to comment or didn’t return requests. Brighthouse, which the Financial Times reported in January was looking for a buyer, declined to comment.

Brighthouse had $125 billion of investments as of Dec. 31, more than two-thirds of it in the kind of highly rated bonds and loans that Wall Street giants are hungry for. It has a market value of $3.2 billion, but nearly $5 billion of debt that any buyer would have to take on.

➚ BUY: Pay to play. Donald Trump Jr.’s new $500,000 social club, Executive Branch, will “cater to the business and tech moguls who are looking to nurture their relationships with the Trump administration,” per Politico.

➘ SELL: Pay to stay. Europe’s top court ordered Malta to shut down its “golden passport” scheme, which allowed sanctioned individuals to buy EU citizenship cheaply. Dubai is still taking comers — provided they are rich or famous enough.

Companies & Deals

• Ad astra: Amazon’s satellite project, Kuiper, has managed to get off the ground, but it’s still well behind Starlink, having taken a more cautious approach than Musk’s fly-fast, fail-fast, fix-fast motto.
• Solved for X: Banks have finally managed to offload the last of the debt from Elon Musk’s acquisition of Twitter, people familiar with the matter told Semafor. A high interest rate made it profitable on paper, but a headache that Morgan Stanley, Bank of America, and Barclays would sooner forget.
• Bay Area buyouts: Josh Kushner’s venture firm Thrive will start “investing in, acquiring, and operating businesses for the long term.” (Note that while some VC firms are edging toward private equity, almost nobody is going the other way: Venture investing remains too small and hit-or-miss to tempt Wall Street.)
• Bar tab: Two years after A&O and Shearman & Sterling merged, the combined law firm has little to show except dragging its British half into Trump’s crosshairs. It’s the latest firm to sign a pro bono settlement with the White House: “Beyond the Trump situation, we have heard very little, next to nothing, out of them,” one legal-industry consultant told the FT.
• Sum of the parts: The FT explains, screw by little screw, why Apple can’t build iPhones in America.

Watchdogs

• Taxation without recommendations: Trump won’t give Senate Republicans crafting a “big beautiful tax bill” a clear answer on what he wants, Semafor’s Burgess Everett, Shelby Talcott and Eleanor Mueller reported yesterday. The estimated $4 trillion needed to extend his 2017 tax cuts has to come from somewhere, and with little guidance to operate on — or much room to increase national borrowing — the idea of tax increases for millionaires is gaining steam. “Unless you do that, the math doesn’t work out,” Steve Bannon told Semafor’s Ben Smith last week. “Tax the rich!” constituents shouted at one New York Republican congressional town hall this week.
• Selfie-portrait: An executive at Elon Musk’s X was, as many users might be, shocked to learn that the platform has been describing itself as a place for friends and family to connect. “I don’t know who wrote that,” X product VP Keith Coleman said on the stand at Meta’s antitrust trial, where Meta’s attorneys tried to show X as a competitor in social-media networks.

Some of the biggest US power companies are at odds with senior Trump administration officials on how to fill the country’s looming electricity deficit and beat China at the AI race, Semafor’s Tim McDonnell reports.

Interior Secretary Doug Burgum told Semafor’s World Economy Summit last week that the continued use of federal tax credits to replace fossil fuels in the electric grid with renewables “would be catastrophic for our country.”

But executives of companies actually managing the delivery of power to new data centers have a more nuanced view: Even as rising trade barriers with China make some technologies more expensive, renewables plus batteries are still the cheapest and fastest way to put new electrons on the grid.