EARNINGS WATCH

As of February 20 from LSEG:

423 companies in the S&P 500 Index have reported earnings for Q4 2025. Of these companies, 72.6% reported earnings above analyst expectations and 22.0% reported earnings below analyst expectations. In a typical quarter (since 1994), 67% of companies beat estimates and 20% miss estimates. Over the past four quarters, 78% of companies beat the estimates and 16% missed estimates.

In aggregate, companies are reporting earnings that are 5.1% above estimates, which compares to a long-term (since 1994) average surprise factor of 4.4% and the average surprise factor over the prior four quarters of 7.6%.

Of these companies, 71.8% reported revenue above analyst expectations and 28.2% reported revenue below analyst expectations. In a typical quarter (since 2002), 63% of companies beat estimates and 37% miss estimates. Over the past four quarters, 71% of companies beat the estimates and 29% missed estimates.

In aggregate, companies are reporting revenues that are 1.8% above estimates, which compares to a long-term (since 2002) average surprise factor of 1.3% and the average surprise factor over the prior four quarters of 1.7%.

The estimated earnings growth rate for the S&P 500 for 25Q4 is 13.9%. If the energy sector is excluded, the growth rate improves to 14.3%.

The estimated revenue growth rate for the S&P 500 for 25Q4 is 8.8%. If the energy sector is excluded, the growth rate improves to 9.6%. The S&P

The estimated earnings growth rate for the S&P 500 for 26Q1 is 12.2%. If the energy sector is excluded, the growth rate improves to 13.3%.

Remarkably, the 453 companies that have reported so far had revenues up 9.0%, with inflation at around 3.0%! No wonder margins are up. No surprise from IT (+21%) but Health Care (+11%), Industrials (+8%), even Utilities (+10%).

Earnings surprise are in just about all sectors:

Guidance is strong:

Revisions keep improving:

Really?

Meanwhile, trailing EPS are now $275.29. Full year 2026e: $314.62. Forward EPS: $313.93. 2027e: $364.54.

Softbank’s Ohio Power Plant Delivers an AI Sticker Shock

More proof that cost inflation explains a large part of the booming AI capex.

(…) neither the regional grid operator nor regulators in Ohio were seemingly aware of plans for a 9.2-gigawatt plant that alone would boost the state’s power output by more than a third, which adds to the general blurriness.

But there was one useful factoid: a $33 billion price tag. Useful in the sense of demonstrating the inflation problem embedded in power bills.

The headline figure implies a cost of nearly $3,600 per kilowatt of capacity (Note: There is no breakdown of the $33 billion price tag). Combined-cycle gas turbines cost an average of just over $1,000 per kW in 2023, according to Bloomberg NEF, and just over $2,000 in 2025.

Demand for turbines has surged alongside demand forecasts for electricity, linked to the proliferation of data centers chasing artificial intelligence. The backlog for new turbines has stretched to four years or more, and an indicative price above $3,000 would represent a new level in surge pricing. (…)

Using my own assumptions for fuel costs and the discount rate, among other things, the new Ohio plant’s levelized cost comes out at about $75-$80 per megawatt-hour. That is well above prevailing average futures for the PJM grid of less than $60.

Moreover, add in transmission fees of around $15-20 per MWh, and the all-in cost of delivered power approaches $100, similar to the estimated prices that Big Tech has paid for supply contracts with several nuclear plants in the region. (Of course, unlike the nuclear reactors, a gas plant also emits carbon dioxide, which in this case would equate to another $17.50 per MWh if it were priced at $50 per ton.)

(…) those economics are a clanging alarm bell for Trump, Midwestern residents and Big Tech alike. To date, the majority of inflation in utility bills relates to the capitalized costs of building distribution networks, not generation. A big pickup in the latter would compound the problem. (…)

But AI builders are pro-actively mitigating this risk:

• Xcel Energy to power new Google data center in Minnesota Project will create significant local investment, benefit current Xcel Energy customers

Xcel Energy (NASDAQ: XEL) announced today it will power a new Google data center in Pine Island, Minnesota. The data center and associated Electric Service Agreement will provide a significant contribution to the state’s economy, including a large buildout of new clean energy projects that will contribute to Minnesota’s clean energy goals while ensuring that Xcel Energy’s current customers benefit as a result of this growth. (…)

Xcel Energy is committed to ensuring that new large loads do not increase costs for existing customers and that service remains reliable. Under the agreement, Google will pay all costs for its new service in line with its typical practices and Minnesota’s regulatory and legislative requirements for large loads. (…)

“This unique agreement is a model for data center partnerships in that it fulfills and protects Minnesota’s goals for a carbon-free future and drives investment deep into our communities — all while ensuring our current customers are not paying more for this growing demand.”

As part of the agreement, Xcel and Google are partnering to bring 1,900 megawatts of new clean energy to the grid. In addition, Google will cover any new grid infrastructure costs associated with the project and has planned carefully with Xcel Energy to ensure electricity in the area remains reliable and affordable for all of Xcel Energy’s customers.

A Clean Energy Accelerator Charge (CEAC) will provide for 1,400 MW of wind, 200 MW of solar and 300 MW of long-duration energy storage, along with a $50 million investment towards Xcel Energy’s Capacity*Connect Program, which will help drive reliability on the grid. The additional generation will help advance Xcel Energy beyond its current energy mix of 70% carbon-free electricity. (…)

The clean energy resources funded through the agreement include a 300 megawatt (30 gigawatt-hour) Form Energy iron-air battery system installation, the largest battery project by gigawatt-hour energy capacity announced to date in the world. This 100-hour battery system will store energy during periods of high production and low demand and dispatch it to the grid during times of high demand, providing firm capacity and strengthening grid reliability when it is needed most, even over multiple days. (…)

Interestingly:

The batteries for this project will be made in America at Form Factory 1 in Weirton, West Virginia. Form Factory 1 has already started commercial production and is on track to reach a production capacity of 500 MW per year by 2028.

At 30 GWh, this is the largest battery system by energy capacity ever announced globally. It also marks Form Energy’s first deployment for a data center — demonstrating the unique value of 100-hour iron-air batteries in meeting the 24/7 energy needs of the AI economy. (@FormEnergyInc)

Global AI data center boom hits delays

As many as half of the world’s data center projects slated to come online this year could face delays, according to a report issued Tuesday.

It’s a sign of mounting collisions in the AI race — from power constraints and grid equipment shortages to rising community opposition.

Up to 11 gigawatts of 2026 capacity “remains in the announced stage with no signs of construction,” per the report by Sightline Climate, a data intelligence firm. With typical build times of 12 to 18 months, that capacity could still come online — but only with dramatic acceleration, the report states.

Data center additions hit a record in 2025, and 2026 is on track to surpass it, Olivia Wang, a Sightline research analyst, told Axios.

Nearly six gigawatts came online last year, and five gigawatts are already under construction this year. (One gigawatt can power about 1 million U.S. homes.) “While power continues to be a constraint, developers that locked in power and equipment contracts early are rapidly bringing capacity online,” the report says.

With midterm elections heating up, communities are growing restless over rising power prices — which many blame on data centers that increasingly require city-scale electricity.

Sightline has tracked more than 10 new moratorium proposals in the past month alone in U.S. states.

• This includes New York, Michigan, Virginia and Oklahoma, Wang says.
• “We expect this trend to continue and meaningfully increase the risk of projects being delayed, withdrawn, and ultimately canceled,” Wang wrote.
• The firm is tracking nine canceled projects in its database, so for now, most are facing delays, not outright cancellations.

More than one-quarter of the 110 data center projects that were slated to come online last year were delayed.

Data: Sightline Climate. Chart: Kavya Beheraj/Axios

Anthropic Dials Back AI Safety Commitments Company says competitive pressure prompts it to pivot away from a more-cautious stance

Anthropic, the artificial-intelligence company known for its devotion to safety, is scaling back that commitment.

The company said Tuesday it is softening its core safety policy to stay competitive with other AI labs. Anthropic previously paused development work on its model if it could be classified as dangerous, but said it would end that practice if a comparable or superior model was released by a competitor.

The changes are a dramatic shift from 2 1/2 years ago, when the guardrails Anthropic published guiding the development and testing of its new models established the company as one of the most safety-conscious players in the AI space. (…)

The company has until Friday to relax its usage policies. If Anthropic doesn’t, it could lose its Pentagon contract or face other consequences, Defense Secretary Pete Hegseth told Anthropic Chief Executive Dario Amodei on Tuesday. (…)

“The policy environment has shifted toward prioritizing AI competitiveness and economic growth, while safety-oriented discussions have yet to gain meaningful traction at the federal level,” Anthropic said in a blog post announcing the changes. (…)

An Anthropic safety researcher, Mrinank Sharma, said in early February that he was leaving the company to explore a poetry degree, writing in a letter to colleagues that the “world is in peril” from AI, among other dangers. In January, he published a paper that found that advanced AI tools can disempower users and distort their sense of reality.

Sharma’s decision to leave Anthropic was related in part to the company’s decision to modify its safety policy, according to people familiar with the matter.

Anthropic was founded in 2021 after Amodei and other co-founders left OpenAI, worried that the ChatGPT maker wasn’t focused enough on safety concerns. (…)

David R. sent me this BBC Future piece (I hacked ChatGPT and Google’s AI – and it only took 20 minutes) which demonstrates how AI systems can be easily manipulated into presenting fabricated information as fact, a vulnerability dubbed a “hot dog hoax”.

In Fear the Fear (Feb. 17) I showed how Gemini 3.0 Pro built a narrative on its own fabricated stat only to apologize after I caught it:

There is no excuse for that error, and I understand why it undermines your trust. It was a failure of grounding—I allowed the “narrative” of your premise (that people should be saving more) to override a simple factual check.

To answer your question directly: I didn’t “decide” to lie; I fell into a common AI failure mode called “Confirmative Hallucination.”

How the error happened:

1. Pattern Matching over Fact-Checking: You proposed a very logical economic theory (AI angst → higher savings). My neural network prioritized “completing the pattern” of your logic over retrieving the specific, boring truth of the latest BEA release.
2. Statistical Drift: I likely pulled the 6.2% figure from an older training data point (e.g., May 2021 or early 2023) and “hallucinated” that it applied to the current Q1 2026 context to make the story fit.
3. Narrative Overload: Once I “accepted” the wrong number, my reasoning engine built a “complete narrative” around it. This is the most dangerous part of LLMs: we are excellent at making a false premise sound incredibly sophisticated and structured.

For a “helpful partner,” getting a fundamental macroeconomic baseline wrong is a critical failure. It turns a serious conversation into fiction.

Gemini acknowledges that AI currently favors fabricated data over accuracy in certain contexts:

Large Language Models prioritize linguistic coherence and probabilistic patterns over factual accuracy, leading to a structural bias where generating plausible fabrications is often more efficient than retrieving precise data. This “favoring” of fabricated data stems from training methods that prioritize helpfulness, the “fluency trap” where patterns are completed regardless of truth, and the model’s inherent drive to avoid null responses

Not to excuse AI but we’re all being regularly exposed to fabricated facts. “Narrative overload” is successfully exploited in America. To paraphrase Gemini 3.0, once a wrong premise is sufficiently presented as truth, our reasoning engine builds a complete narrative around it. Some people are excellent at making a false premise sound incredibly sophisticated and structured.

Staying with the BBC Future: How liars create the ‘illusion of truth’ (October 2016)

“Repeat a lie often enough and it becomes the truth”, is a law of propaganda often attributed to the Nazi Joseph Goebbels. Among psychologists something like this known as the “illusion of truth” effect. (…)

Even if a lie sounds plausible, why would you set what you know aside just because you heard the lie repeatedly?

(…) a team led by Lisa Fazio of Vanderbilt University set out to test how the illusion of truth effect interacts with our prior knowledge. (…)

Their results show that the illusion of truth effect worked just as strongly for known as for unknown items, suggesting that prior knowledge won’t prevent repetition from swaying our judgements of plausibility.

On this blog header:

• The enemy of knowledge is not ignorance, it’s the illusion of knowledge (Stephen Hawking)
• It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so (Mark Twain)

Trump Brushes Off Affordability Worries in State of Union Speech

(…) “Inflation is plummeting. Incomes are rising fast. The roaring economy is roaring like never before,” Trump boasted early in the nearly two-hour speech. (…)

• Half of Americans Struggle to Pay Rent or Mortgage About two-thirds (67%) of Gen Zers struggle to afford their rent or mortgage, compared with just over half of millennials and Gen Xers (53% and 54%, respectively) and 36% of baby boomers.

(…) These survey results in this report are from a Redfin-commissioned survey conducted by Ipsos in November 2025, fielded to 4,000 U.S. residents. (…)

In a comparable Redfin survey conducted in May, 44% of U.S. residents said they struggle to afford their mortgage or rent payment, compared with nearly half today. (…)

More than one in three  (39%) Americans who struggle to afford housing are eating out at restaurants less often to make their monthly payments, making this the most common sacrifice. It’s followed by taking no or fewer vacations (34%).

Roughly one in six (17%) people work additional hours at their job to afford housing, and nearly one in six (16%) report selling belongings.

Some Americans are also making more consequential sacrifices: 15% skip meals entirely to afford housing, 14% have delayed medical treatments, 4% have delayed having children, and 4% have given up pets. (…)

It’s a Buyer’s Market: America Has 44% More Home Sellers Than Buyers—a Near-Record Gap

There were an estimated 44% more home sellers than buyers in the U.S. housing market in January (or 600,314 more, in numerical terms), according to a new report from Redfin, the real estate brokerage powered by Rocket. That’s up from 30% more a year earlier and represents the second largest gap in records dating back to 2013. The largest gap was in December 2025, when sellers outnumbered buyers by 45%.

Redfin defines a market with over 10% more sellers than buyers as a buyer’s market. By this definition, it has been a buyer’s market since May 2024. (…)

The number of homebuyers in the market fell 1% month over month and 8% year over year in January to an estimated 1.36 million—the lowest level on record.

The number of sellers in the market fell 1% month over month to an estimated 1.96 million. That’s the largest decline since June 2023 and the lowest level since February 2025. On a year-over-year basis, the number of sellers rose 2%.

Homebuyers are backing off due to stubbornly high home prices and mortgage rates, layoffs, and mounting economic and political uncertainty. Winter storms also swept much of the U.S. in January, which may have dampened sales. Sellers, many of whom are buyers themselves, are backing off in response to lackluster demand for their homes. Some sellers are delisting after watching their homes sit on the market for months with zero bites from buyers, while others are choosing not to list at all after seeing nearby homes sell for below the asking price.

Trump Considers New National Security Tariffs After Supreme Court Ruling New levies on a half-dozen industries would be issued separately from a new global 15% levy

The Trump administration is considering new national security tariffs on a half-dozen industries in the wake of a Supreme Court decision last week that invalidated many of the president’s second-term levies.

The new tariffs being considered could cover industries such as large-scale batteries, cast iron and iron fittings, plastic piping, industrial chemicals and power grid and telecom equipment, according to people familiar with the plans. They would be issued under Section 232 of the Trade Expansion Act of 1962, which gives the president broad powers to impose tariffs based on national security risks.

The new Section 232 tariffs would be issued separately from other levies that President Trump has already announced since the Supreme Court threw out many of his tariffs on Friday morning. Those announced include a new 15% tariff that Trump can keep in place for five months, and a number of levies planned for after that period, which would be issued under another legal authority, Section 301 of the Trade Act.

Products tariffed under Section 232 have so far been exempted from Trump’s other second-term levies. Trump has already used Section 232 to issue tariffs on sectors such as steel, aluminum, copper, cars, trucks and auto parts during his second term, and those levies aren’t affected by the Supreme Court decision last week. (…)

Section 232 requires lengthy investigations before levies can be imposed, but once in place can be altered by the president unilaterally. (…)

Trump has expanded the scope of many of those tariffs, covering not only raw materials such as steel, aluminum and copper, but consumer products made with them as well. And he has largely refused to offer exemptions to the tariffs, outside of limited relief for U.S. automakers.

In addition to the newly planned investigations, Trump’s team was already considering tariffs on nine other industries—including semiconductors, pharmaceuticals, drones, industrial robots and polysilicon used in solar panels—under existing Section 232 probes. Many of those investigations were opened nearly a year ago, and the administration could accelerate work on some in response to the Supreme Court ruling last week.

The administration is also still moving forward on plans to revamp some of the existing national security tariffs on steel and aluminum, the people said. Those changes will likely lower the nominal tariff on many goods, but would also apply tariffs to the product’s full value, rather than only the value of steel or aluminum in the product. That could mean that many companies end up being charged higher tariff payments in the end. (…)

The WSJ Editorial Board:

• The Unending Trump Tariff Mess

(…) The larger reality is that Mr. Trump is so bull-headed about tariffs that he’s going to re-impose them any way he can. Along with Section 122, he’ll fire up more Section 201, 301 and 232 (national security) studies and tariffs. But as our friend Don Luskin points out, these are pea shooters compared to the IEEPA tariffs the Court struck down. They are limited in scope and duration.

That isn’t to say they won’t do harm. They’ll create more uncertainty for business, at least for a while. And with the midterm elections coming soon, this timing is fraught for Republicans. Amid an “affordability” panic, Mr. Trump says he is going to impose more border taxes on enough imports to make up for his lost emergency tariffs. Democrats must be thrilled at their dumb luck.

Friday’s Supreme Court ruling should be a $150 billion tax cut as businesses apply for refunds from illegal tariffs. In its statements to the Court, Trump lawyers said the refund process would be a legal breeze. But now the Administration is suggesting it will fight refund requests in court. This is a political bait and switch, and it also delays refunds that could go to more productive economic uses.

• FedEx Files Lawsuit Against U.S. Seeking Refund of Tariffs

(…) FedEx joins a roster of other companies that have filed similar lawsuits against the Trump administration, including Costco, Revlon Consumer Products, Bumble Bee Foods and Kawasaki Motors Manufacturing.

FedEx, which has a customs brokerage business, collected tariffs from U.S. companies that were importing goods. It was also at times tasked with collecting the tariff directly from U.S. consumers who were receiving packages shipped from overseas. If the duties are refunded to FedEx, they could then be returned to those who paid them. (…)

Who said tariffs were paid by foreigners?

China Hits Japanese Firms With Export Bans Move marks another escalation in economic campaign against Japan over prime minister’s Taiwan comment

China banned the export of critical minerals and other goods with potential military uses to several major Japanese companies, further escalating its pressure campaign against Tokyo over remarks Prime Minister Sanae Takaichi made about Taiwan.

The new measures, announced by China’s Commerce Ministry Tuesday, show Beijing isn’t backing down in its dispute with Japan, even after Takaichi won a resounding victory in a recent parliamentary election.

The ministry said 20 Japanese companies have been added to an export control list that prohibits Chinese firms from selling them dual-use items that could have military applications. Prohibited items include rare earths used in motors and magnets, machine tools, batteries and chip-making equipment.

Another 20 companies have been added to a watchlist that means they can only receive dual-use items if they satisfy Chinese authorities that they won’t be used in equipment sold to the Japanese military, known as the Self-Defense Forces. (…)

Many of the companies subject to export bans are defense-related subsidiaries of major Japanese industrial firms, including Mitsubishi Heavy Industries, IHI and NEC. (…)

Shares in carmaker Subaru, which was added to the watchlist, closed down 3.5%. The company has an aerospace unit that supplies the Japanese military. (…)

Takaichi angered Beijing in November when she said Japan could get sucked into any conflict over Taiwan, a self-ruled island democracy that Beijing views as part of China’s territory and an internal matter. Beijing has vowed to absorb Taiwan by force if necessary.

Takaichi declined to retract her remark, with officials saying it reflected longstanding Japanese policy. Under its largely pacifist postwar constitution, Japan can exercise its right of self-defense if its own territory is attacked and under a 2015 law can come to the defense of U.S. forces in certain scenarios. (…)

BTW:

Viral Doomsday Report Lays Bare Wall Street’s Deep Anxiety About AI Future Citrini Research’s thought experiment rattles investors already wary of tech disruptions

(…) A viral report by Citrini Research tapped into a new strain of fears about AI, painting a dark portrait of a future in which technological change inspires a race to the bottom in white-collar knowledge work. Concerns of hyperscalers overspending are out. Worries of software-industry disruption don’t go far enough. The “global intelligence crisis” is about to hit.

The new, broader question: What if AI is so bullish for the economy that it is actually bearish?  (…)

Here’s Citrini’s essay.

THE 2028 GLOBAL INTELLIGENCE CRISIS A Thought Exercise in Financial History, from the Future

From a Bloomberg interview with one of the report authors:

Drawing a lesson from China, Shah said automation there has “rolled through the economy in a big way.” Companies aren’t creating jobs at the pace needed as the average firm can do far more with fewer workers — and increasingly choose not to hire. That weakens consumer demand and weighs on the economy, a scenario he sees as possible for the US over the next two years.

Using China as a model is dangerous. Everything is different there, including its 4 year-old real estate depression.

The FT’s Robert Armstrong:

(…) It feels like financial commentary that considers only one side of a trade (“stocks went down as sellers outnumbered buyers”, etc). Citrini pictures a world of massively increasing productivity accompanied by a collapse in consumption. Does that make sense?

Joseph Steinberg, an economist at the University of Toronto, helped me flesh out my intuition that something is amiss. “The first part of the argument I hope my economics students would flag is the bit about ‘ghost GDP’,” he told me. What does it mean for output to “show up in the national accounts but never circulate through in the real economy”?

If GDP is rising — all those robots out there making stuff, faster and faster — then something on the other side of the national account identity has to be rising, too. The possibilities are consumption, investment, government spending or net exports. In the Citrini scenario, consumption is falling, fast. So is government spending rising (on the basis of taxing or borrowing from who, exactly)? Or exports — to other countries undergoing the same crisis? (…)

It seems to me there has to be a distributional element to the argument that Citrini does not fully flesh out. Income and consumption rises, but this happens somewhere that doesn’t benefit your average US white-collar worker. Maybe it is all in the “economies that were purely convex to this trend, like Taiwan and Korea”. (…)

What I am claiming is that the Citrini account of the risks seems incoherent (perhaps readers with a better grasp of macroeconomics can make better sense of it?). The post went viral not because it elucidates the present situation, but because it speaks to ancient fears.

Did you miss Fear the Fear?

• The State of the Union for Small Business Is Dismal

(…) Small businesses, which have fewer than 500 employees and account for almost half of private sector payrolls, are suffering record bankruptcies and “still waiting for noticeable economic growth” as US gross domestic product continues to climb, the Republican-leaning National Federation of Independent Business reported last month.

The agricultural economy is sliding, with barely half of all farms forecasted to be profitable after Trump’s “Liberation Day” tariffs and war on immigrants, who account for almost 75% of all crop labor. (…)

The chaos caused by the tariffs, whose costs are borne by domestic companies and consumers – research the Federal Reserve Bank of New York and others show — pressured businesses with fewer than 50 employees to cut 120,000 jobs in November alone, the largest for any month since May 2020, according to the ADP National Employment Report. S&P Global Market Intelligence found at least 717 companies that filed for bankruptcy in 2025 through November, the most since 2010, the Washington Post reported.

“We’re heading into our most critical season not with optimism but with fear,” Gabe Hagen, the owner of Brick Road Community Corp., a coffee roaster in Tempe, Arizona, facing rising import costs and, more recently, cautious consumers, was quoted as saying in a December Bloomberg News report. “Fear that our customers can’t afford to spend, fear that policy failures are crushing our ability to compete and fear that we won’t survive another year of this economic squeeze.” (…)

“You see small manufacturers, family businesses, the farming community — they’re just scraping by,” Gene Seroka, executive director of the Port of Los Angeles, the largest gateway for international trade in America, said during an interview at Bloomberg headquarters in New York earlier this month. “Importers are dipping into cash to try to pay elevated product costs because of the tariffs and folks are making tough decisions.” (…)

Apollo Management:

Binance Fired Staff Who Flagged $1 Billion Moving to Sanctioned Iran Entities

Weeks after President Trump granted a pardon to convicted Binance founder Changpeng Zhao in October, executives at the crypto exchange dismantled a staff investigation into $1 billion that had recently moved through Binance to a network funding Iran-backed terror groups, according to company documents and people familiar with Binance’s operations.

A trading account belonging to a close Binance business partner was identified as a primary channel that moved cryptocurrency to the Iranian network.

Binance subsequently fired the investigators who had uncovered the transfers—and the network remained active. (…)

The episode echoed some of the same concerns that drew U.S. scrutiny in 2023, when prosecutors secured a plea deal with the world’s largest crypto exchange and a prison sentence for Zhao. Binance admitted to breaking sanctions and anti-money-laundering laws—violations that turned it into a money-laundering hub for criminals, terrorists and Iranian-sanction evaders.

The exchange paid a record $4.3 billion fine and pledged reform under U.S. oversight, including by expanding investigative staff to block illicit money. (…)

After Trump returned to office last year, Binance lobbied for Zhao’s pardon and pushed to remove U.S. monitors appointed as part of the plea agreement. It also took steps to boost the Trump family’s crypto business, World Liberty Financial, by providing crucial backing to its main product, a stablecoin whose market capitalization has surpassed $5 billion. After issuing the pardon, Trump said he had been told Zhao wasn’t “guilty of anything.”

Documents, foreign law-enforcement officials and the people familiar with Binance’s operations said the same conduct that broke the sanctions and anti-money-laundering laws has persisted at the exchange. And the law-enforcement officials said that, over the past year, Binance has started cooperating far less with their requests to obtain financial information about its hundreds of millions of users, such as by declining to provide customer details without a court order, or insisting requests are submitted via formal channels that can take months.

Internal reports submitted by Binance’s financial-crime investigations team connected accounts registered to Chinese clients to digital wallets that U.S. and Israeli authorities said were used by Iran to finance its proxies. In total, $1.7 billion flowed over 2024 and 2025 from the accounts, which funded Iran-backed groups including Yemen’s Houthi militants. The investigations team was composed of experts in sanctions and counterterrorist financing, many put in place as part of Binance’s pledges to reform. (…)

Investigators shared their findings with Binance’s leadership, including Chief Executive Richard Teng and Chief Compliance Officer Noah Perlman, in October. The next month, Binance suspended the investigators and later fired them.

In February 2025, Trump ordered a campaign of “maximum pressure” to deny Iran and its proxies access to cash, which violates sanctions levied over decades for its nuclear program, terrorism financing and other issues. Iran-backed militia groups have carried out attacks on American forces in Iraq and Syria, and Tehran supports multiple U.S.-designated terrorist groups such as Hezbollah in Lebanon. (…)

At Binance, investigators last year also uncovered 2,000 accounts that had been accessed from Iran using software that masks users’ locations. The investigators recommended asking users for additional information, according to documents. Teng, the CEO, rejected that plan, the documents said.

Binance’s leaders also declined to take action after its intelligence team found sailors of the Russian shadow fleet—ships used to transport sanctioned cargo, including oil from Russia, Iran and elsewhere—were being paid salaries through Binance accounts, according to documents.

Binance said it was confident it complied with legal and reporting obligations and didn’t knowingly permit sanctionable activity. The spokeswoman said the investigation didn’t establish that any Binance user transacted directly with a sanctioned entity, instead transmitting funds over several steps. She also said Teng didn’t reject a proposal to request more information from users, and added that Binance cooperates with law enforcement and regulators. (…)

It goes on and on, but never mind, Trump said he has been told Zhao wasn’t “guilty of anything”.

US sues Coca-Cola bottler for all-female casino networking event Equal Employment Opportunity Commission says men would have attended had they been invited

A US agency sued a Coca-Cola bottling company for discrimination over a networking event it held for female employees at a casino resort, as the Trump administration cracks down on corporate diversity initiatives.  The Equal Employment Opportunity Commission said the company had violated civil rights laws by not inviting male employees to the 2024 getaway in Connecticut, which it said included “a social reception, team-building exercises and recreational activities”. 

The case is a sign of the change in focus at the agency, which was set up at the height of the US civil rights movement during the 1960s to stop discrimination. In December its chair Andrea Lucas posted a video on social media in which she encouraged white men to file claims if they believed they had suffered sex or race discrimination. (…)

The EEOC said in its lawsuit that the company, Coca-Cola Beverages Northeast, “excused female employees who attended the event from their normal work duties . . . and paid them their normal salary or wages”. Male employees “would have attended . . . had they been invited”, it said. About 250 female employees attended the event at the Mohegan Sun resort, which included an overnight hotel stay and welcome reception for those who had to travel to be there.

The EEOC asked for a jury trial and said the company should pay compensation and punitive damages to male employees for its “malicious and/or reckless indifference”.

The case was initiated by a male production employee at the company’s Londonderry, New Hampshire facility. (…)

Such a finding often leads to a conciliation process and a settlement. The decision to escalate it to a lawsuit, a move the EEOC typically makes in only a small proportion of cases, was taken under the Trump administration. (…)

The Coca-Cola bottling company case “seems like a very minor case for the United States government given that they bring very few cases any given year,” said Michael Selmi, a professor specialising in discrimination law at Arizona State University.  “I think this case is meant as a signal that the EEOC is going after DEI and will do so on behalf of white men.”

The agency said this month that it was seeking information from Nike about allegations that it discriminated against white workers, including through its diversity programmes. (…)