Core Insights - Meta is preparing to lay off approximately 10% to 15% of its 15,000 employees in the Reality Labs division, focusing on teams involved in virtual reality headsets and Horizon Worlds [1][2] - The layoffs are expected to be announced this week, coinciding with a significant division-wide meeting called by Meta's CTO and Reality Labs chief Andrew Bosworth [2] - Reality Labs has incurred over $70 billion in losses since 2020, prompting Meta to shift its focus and spending towards artificial intelligence [2] Group 1 - The layoffs will disproportionately affect teams working on virtual reality products [1] - The upcoming meeting is described as the "most important" of the year, indicating potential significant changes within the division [2] - Bosworth has emphasized that 2025 will be a critical year for Reality Labs, which will determine its legacy [3]

Donald Trump wants Jerome Powell, the head of the Federal Reserve, to do something Powell doesn't want to do. Now, Trump's federal prosecutors are now investigating Powell.That's the shortest version of the news story that broke Sunday night, when Powell released an extraordinary statement and video, which I urge you to watch and read for yourself. Key quote from Powell, who Trump picked as Fed chair in 2017: "This unprecedented action should be seen in the broader context of the administration's threats ...

Core Viewpoint - President Trump's proposal to cap credit card interest rates at 10% could lead to significant negative consequences for both consumers and the financial industry, despite its intention to alleviate high borrowing costs [1][2]. Financial Industry Impact - Major financial stocks, including Capital One, Synchrony Financial, JPMorgan, and Citigroup, experienced a sell-off following the announcement of the proposed rate cap [1]. - UBS analysts predict that the plan would likely reduce credit availability, particularly for middle- and lower-income Americans, rather than simply making credit cheaper [3]. Consumer Spending and Economic Growth - The proposed cap could lead to a reduction in consumer spending, which accounts for approximately 70% of US GDP, potentially compromising overall economic growth [4]. - According to Boston Fed data, a significant portion of credit card spending, particularly from lower-income households, would be at risk, indicating a major economic impact [4]. Expert Opinions - Other financial experts, including billionaire investor Bill Ackman, have echoed concerns that the credit card rate cap could backfire, potentially resulting in millions of credit card cancellations [5].

Group 1 - Meta is launching a new initiative called Meta Compute, focusing on building data centers and infrastructure for AI, with plans to develop "tens of gigawatts" of capacity this decade and "hundreds of gigawatts or more" over time [1][2] - The company plans to invest $600 billion in US infrastructure and jobs, including AI data centers, by 2028, indicating a strong commitment to AI infrastructure as a competitive advantage [2] - The new initiative will be led by Santosh Janardhan and Daniel Gross, with oversight from Dina Powell McCormick, who will focus on partnerships with governments and sovereign entities for infrastructure financing [3][4] Group 2 - The power output of one gigawatt is comparable to half the output of the Hoover Dam or the power of 2,627 Tesla Model 3s, highlighting the scale of Meta's planned infrastructure [3] - The strategic focus on AI infrastructure is seen as a key competitive advantage for Meta, with the initiative reporting directly to CEO Mark Zuckerberg [2]

Meta has a new president — and she's a former advisor to President Donald Trump. The tech giant named Dina Powell McCormick as its president and vice chairman on Monday. Powell McCormick joined Meta's board in April before resigning in December.Before joining Meta, Powell McCormick served as a deputy national security advisor to Trump. The president applauded her appointment on Truth Social: "A great choice by Mark Z!!" Powell McCormick is the second former Trump official appointed to a Meta leadership po ...

Apple and Alphabet have reached a deal for Google's Gemini to power Siri's artificial intelligence capabilities. The companies said these models would help power future Apple Intelligence features, including a more personalized Siri coming this year. "After careful evaluation, Apple determined that Google's AI technology provides the most capable foundation for Apple Foundation Models and is excited about the innovative new experiences it will unlock for Apple users," Apple and Google wrote in a statement. ...

Core Viewpoint - Paramount's CEO David Ellison is pursuing legal action to gain access to financial information from Warner Bros. Discovery (WBD) regarding its valuation of cable networks, aiming to facilitate informed decisions for WBD shareholders regarding Paramount's acquisition offer [1][2][7]. Group 1: Acquisition Attempts - Paramount has made eight unsuccessful attempts to acquire WBD, with its latest offer being an all-cash proposal of $30 per share, which is positioned as superior to Netflix's offer [1][3]. - The initial offer from Paramount was made at a significant premium to WBD's share price of $12.54, culminating in the current $30 per share proposal [3][4]. Group 2: Legal Action and Information Disclosure - Paramount has filed a lawsuit in Delaware Chancery Court to compel WBD to disclose financial information necessary for shareholders to evaluate the acquisition offer [6][7]. - WBD has not provided adequate financial disclosures regarding the valuation of the Global Networks stub equity or the overall Netflix transaction, which is required under Delaware law [6][7]. Group 3: Shareholder Engagement and Future Steps - Paramount plans to nominate a slate of directors to engage with WBD's board and propose amendments to WBD's bylaws to require shareholder approval for any separation of Global Networks [4][5]. - The company aims to ensure that WBD shareholders have the final say on which offer is more beneficial, emphasizing the importance of transparency and constructive dialogue with WBD's board [4][9].

In a rare video message released early on Sunday, Federal Reserve Chair Jerome Powell said the US central bank had received grand jury subpoenas that could expose it to criminal indictment by the Department of Justice. Powell said the subpoenas relate to his June testimony concerning renovation work at the Fed's office buildings.He said that the move was part of a pressure campaign by the Trump administration aimed at pushing the central bank to lower interest rates. Read his full statement below:Good eve ...

Core Viewpoint - Tesla is facing a class-action lawsuit regarding the failure of its electronically powered door handles in the Model S, highlighting ongoing safety concerns and potential design flaws in its vehicles [1][2][4]. Group 1: Lawsuit Details - The class-action lawsuit was filed in Florida by a Tesla owner, representing those who purchased or leased a 2014-2016 Model S, alleging that the flush door handles routinely fail after a few years of use [1][2]. - The complaint states that three out of four door handles on the plaintiff's 2015 Model S had failed by 2022, creating significant inconvenience and safety risks [3]. - The lawsuit claims that Tesla was aware or should have been aware of the defective handles, as evidenced by the redesign of door handles in post-2016 Model S vehicles [4]. Group 2: Safety Concerns - The electronically powered door handles can become inoperable if the vehicle's low-voltage battery dies, potentially trapping passengers inside during emergencies [5]. - Recent lawsuits have been filed related to fatalities where victims were trapped inside vehicles due to door handle failures, including incidents involving a Cybertruck and a Model S [6]. - The National Highway Traffic Safety Administration is investigating reports of children being trapped inside Model Y vehicles due to door handle failures [7]. Group 3: Company Response and Industry Implications - Tesla's vehicles do have manual door releases, but critics argue these are not easily accessible in emergencies, prompting the company to redesign door handles for better manual control visibility [8]. - A recent safety page on Tesla's website states that doors will automatically unlock for emergency access, but notes that certain safety features may not be available based on the vehicle's build date [9].

Group 1 - The earnings season is led by major banks, starting with JPMorgan, followed by Bank of America, Citi, Goldman Sachs, and Morgan Stanley [1][2] - Banks are crucial to the economy due to their lending and dealmaking capabilities, making their earnings reports significant for understanding broader economic trends [2] - The year-end earnings reports will reflect on a volatile first half of 2025, with stocks, including banks, reaching record highs despite concerns about an AI bubble [4] Group 2 - President Trump is focusing on affordability, which may impact various sectors, including the defense sector and institutional investors in residential housing [5][6] - The potential for Trump's affordability agenda could be beneficial for banks, as a healthy consumer environment typically supports their business [6] - Other industries should remain vigilant as they may become targets of Trump's affordability initiatives, regardless of their direct relevance to the issues he addresses [7]