03 February 2025

Daily Newsletter

Trump Warns of Tariffs Against EU, UK

The Facts

  • US Pres. Donald Trump stated on Sunday that he intended to impose tariffs on the EU "pretty soon," while claiming that potential tariffs with the UK could be "worked out" despite the country being "way out of line."

  • Trump criticized the US-EU trade imbalance within the automotive and farming industries and alleged the bloc had "really taken advantage" of the US. Census Bureau data shows the US had a $214B goods trade deficit with the EU in 2024.

  • In comparison, the US maintained a positive trade balance of approximately $10B with the UK in 2024. The US is the UK's single largest trading partner, while the US-EU trade is the largest relationship in the world, representing 30% of global goods and services trade and 43% of global gross domestic product (GDP) in 2023.


The Spin

Pro-Trump narrative

Trump's tariff strategy is essential to leveling the playing field for American businesses. For too long, the US has faced unfair trade practices from countries like China and the EU, which impose higher tariffs on American goods. By raising tariffs, Trump is protecting American jobs, boosting domestic industries, and reducing the trade deficit. It's a move that prioritizes American interests and ensures fairer competition in the global market.

Anti-Trump narrative

Trump's tariff threats against Europe are reckless and counterproductive. By pursuing a trade war, he risks hurting both American and European economies, driving up consumer prices and damaging vital trade relationships. This self-serving move undermines global cooperation and only benefits a wealthy few, while the real winners — China, Russia, and Iran — stand by and watch the chaos unfold.

See sources

Rubio, Mulino Meet Amid Rising US-Panama Tensions

The Facts

  • US Secretary of State Marco Rubio met with Panamanian Pres. José Raúl Mulino in Panama City — delivering a warning that immediate changes were needed regarding China's influence over the Panama Canal area, or the US would take measures to protect its treaty rights.

  • The diplomatic tension escalated after President Trump's repeated demands to retake control of the Panama Canal, claiming Panama violated agreements by allowing Chinese influence, though the canal is operated by the Panama Canal Authority, an autonomous Panamanian government agency.

  • Approximately 200 protesters marched in Panama City, carrying national flags and shouting anti-US slogans, while riot police prevented them from reaching the presidential palace during the diplomatic meetings.


The Spin

Narrative A

The PRC's influence over the Panama Canal poses a serious national security threat, as Beijing could potentially use its control of port facilities to disrupt this vital waterway during a conflict. The current arrangement violates the neutrality treaty and demands immediate intervention to protect American interests and rights.

Narrative B

Panama maintains full sovereignty over the canal through legally binding treaties, and the canal operates independently under Panamanian administration. The presence of international companies at ports, including those from Hong Kong, does not compromise Panama's control or violate any agreements, and attempts to reclaim the canal represent unacceptable imperial overreach.

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SoftBank, OpenAI Partner to Develop AI for Japanese Firms

The Facts

  • Japan's SoftBank Group and US-based OpenAI on Monday announced a joint venture — SB OpenAI Japan — to develop Cristal intelligence, an advanced enterprise artificial intelligence (AI) offering that securely integrates Japanese firms' systems and data in a customized manner.

  • During its launch in Tokyo, SoftBank Chief Masayoshi Son and OpenAI's Chief Executive Officer Sam Altman invited Japanese firms to join the vision of their 50-50 held company, operating under SoftBank's telecom arm SoftBank Corp.

  • SoftBank will spend $3B yearly to deploy OpenAI's services in its group firms, while SB OpenAI Japan will hire 1K people from SoftBank to market OpenAI's products to carmakers, retailers, and other industries.


The Spin

Narrative A

For Son, everything until now has been a mere prelude. The billions spent, the risks taken — these were just warm-ups for his true vision artificial superintelligence. He envisions a future where AI reshapes daily life, managing households, emotions, and entire economies. With SoftBank's war chest and OpenAI as a key ally, Son is charging ahead, undeterred by past failures. For him, this isn't just business — it's destiny, the defining moment he was born to create.

Narrative B

AI's speculative fever has hit hypergear. Son's high-stakes gambit backing OpenAI, Wayve, and Perplexity AI mirrors a history of dizzying wins and catastrophic losses. As valuations soar and computing power bottlenecks tighten, the AI boom edges toward an unsustainable crescendo. Whether this is the start of a revolution or a Minsky-style collapse, one thing is certain — the AI bubble isn't slowing any time soon. It's only accelerating.

Narrative C

Son's latest AI fervor feels like overcompensation — an almost desperate attempt to rewrite history after missing Nvidia's meteoric rise and arriving late to OpenAI. Now, he's poised to double down, throwing billions at Altman's venture just as challengers like DeepSeek have emerged. The irony? Son spoke of AI's future for years, yet his timing remains off. Whether his latest bet cements his legacy or joins his past misfires remains an open question.

Narrative D

SoftBank's deepening ties with OpenAI mark a geopolitical pivot, binding Japan to America's AI ambitions while counterbalancing China's rise. Now chairing the $500B US-backed initiative, Son positions Japan as a critical AI power broker. However, as Donald Trump fast-tracks AI infrastructure under national security rhetoric, Japan risks being both a linchpin and a pawn in an escalating US-China tech cold war. The race just got sharper.

Nerd narrative

There's a 15% chance that the bubble in the Magnificent Seven will pop before 2026, according to the Metaculus prediction community.

See sources

Ex-Spanish Soccer Chief on Trial Over World Cup Kiss

The Facts

  • Former Spanish soccer federation president Luis Rubiales went on trial in Madrid on Monday over charges of sexual assault and coercion for kissing player Jenni Hermoso during the medal ceremony after Spain's 2023 Women's World Cup victory.

  • During her testimony, Hermoso said she never consented to the kiss and felt disrespected, telling Madrid's High Court, "I knew I was being kissed by my boss and that should not happen in any social or work environment."

  • The 34-year-old forward claimed that Rubiales, 47, "grabbed" her head "effusively," adding, "I couldn't react. It was a thousandth of a second. I felt that it was completely out of context."


The Spin

Narrative A

Rubiales' kiss was a spontaneous gesture of celebration during a moment of national triumph, occurring without bad faith in a time of maximum jubilation. The incident has been blown out of proportion amidst cultural and political posturing, and become a witch hunt against Rubiales.

Narrative B

This inappropriate act represented an abuse of power and highlighted deep-rooted sexism in Spanish soccer, tainting what should have been one of the greatest achievements in Spanish women's sports history. The incident demonstrates how female athletes continue to face inappropriate treatment from male authority figures.

Nerd narrative

There's a 50% chance that robots will win a game of association football (soccer) against professional human players by August 2048, according to the Metaculus prediction community.

See sources

Destruction in Jenin as Israel Expands Northern West Bank Offensive

The Facts

  • Israel has destroyed over 20 buildings and other pieces of infrastructure in the Jenin refugee camp in the northern West Bank as an offensive it launched last month continues. Israel said it destroyed the buildings "to prevent terrorist infrastructure from being established there."

  • The offensive, which was launched two days after the cease-fire in Gaza came into effect, has so far displaced almost all of Jenin refugee camp's 20K population. At least 25 Palestinians — including nine militants — have been killed.

  • Israel said it has killed at least 35 Palestinian fighters from different armed groups and detained over 100 wanted individuals. The Palestinian Health Ministry said that Israel has killed 70 Palestinians, including ten children, in the West Bank since the beginning of the year.


The Spin

Pro-establishment narrative

Though Israel has a right to respond to terrorist threats, Israeli policy should avoid escalating tensions. After 15 months of intense warfare in Gaza, Israel failed to dismantle Hamas, and it is unlikely that a heavy-handed approach will succeed in the West Bank. Indeed, connecting the war in Gaza to operations in the West Bank is largely a political decision.

Pro-Israel narrative

Now that the wars with Hamas in Gaza and Hezbollah in Lebanon have largely come to a close, Israel must focus on the terror threat in the West Bank. Iran continues to stoke the flames of conflict by smuggling weapons to terrorist groups in the West Bank, and Israel must respond forcefully.

Pro-Palestine narrative

Only days after Israel was forced to end its genocidal war in Gaza, it has launched a massive assault on the occupied West Bank. The PA, Israel's subcontractor of the occupation, has also assisted Israeli forces in their aggression against Palestinians. Indeed, given the statements of Israeli leaders, Israel seeks to treat the West Bank like Gaza, destroying civilian infrastructure and ethnically cleansing the population.

Nerd narrative

There's a 1% chance that Israel will lose control over the Golan Heights before 2030, according to the Metaculus prediction community.

See sources

Chinese Fashion Giant Shein Returns to India After 2020 Ban

The Facts

  • Chinese fast-fashion giant Shein has re-entered the Indian market through a partnership with Reliance Retail, nearly five years after it was banned alongside several PRC apps — including TikTok — due to security concerns.

  • Owned by billionaire Mukesh Ambani, Reliance launched the Shein India Fast Fashion app on Saturday. The app will initially serve Delhi, Mumbai, and Bengaluru and offer products — designed and manufactured within India by local manufacturers — starting at ₹199 ($2.30).

  • The licensing agreement stipulates that Reliance will maintain complete control over Shein's operations and data and store customer information locally, while Shein will be a technology partner and receive licensing fees without equity investment.


The Spin

Narrative A

The partnership creates a win-win situation by combining Shein's global fashion expertise with Reliance's local manufacturing capabilities. It could potentially boost India's textile exports while offering consumers affordable, trendy fashion options.

Narrative B

Shein's re-entry raises concerns about market disruption and intensified price competition, potentially threatening smaller Indian fashion brands and retailers who might struggle to match Shein's scale and pricing strategy.

Nerd narrative

There's a 14% chance that there will be a China-India war by 2035, according to the Metaculus prediction community.

See sources

Trump Moves to Shut Down USAID

The Facts

  • The US Agency for International Development (USAID) headquarters was closed to agency personnel Monday, following a directive from agency leadership. In addition, its website and social media accounts went offline over the weekend. US Secretary of State Marco Rubio has stated that he is now acting director of USAID.

  • This comes after two top USAID security officials — John Voorhees and his deputy — on Sunday were placed on administrative leave after refusing to grant Department of Government Efficiency (DOGE) personnel access to classified systems and secure areas within the agency headquarters.

  • Elon Musk, who is heading up DOGE, Monday during a conversation on X with prominent Republicans confirmed the efforts to shut down USAID and added that Pres. Donald Trump agreed that he had endorsed these efforts. Meanwhile, Sen. Brian Schatz (D-Hawaii) suggested he would hold Trump's Dept. of State nominees until the USAID situation is "resolved.


The Spin

Republican narrative

The foreign aid bureaucracy wastes billions of taxpayer dollars and gives money to countries that don't even want the aid because they know it's going to do more harm than help. USAID is beyond repair and it's crucial that its funds be redirected toward the domestic priorities of the administration.

Democratic narrative

USAID plays a vital role in advancing US national security interests through humanitarian assistance, development programs, and crisis response worldwide. Dismantling the agency severely damages American global leadership and also violates federal law because Congress has already allocated the agency's funding.

Nerd narrative

There's a 50% chance that the US government will spend, as a percentage of GDP, at least 37.4% in 2031, according to the Metaculus prediction community.

See sources

France: Bayrou Passes Budgets With Article 49.3, Faces No-Confidence Vote

The Facts

  • French Prime Minister François Bayrou triggered Article 49.3 of the Constitution on Monday to push through both his state budget and the first of three parts of the social security budget without a parliamentary vote, claiming the urgent need for financial stability.

  • The 2025 budget aims to reduce France's deficit from 6% to 5.4% of gross domestic product (GDP) through €30B in spending cuts and €20B in new taxes. France's deficit is over double that of the EU's expected cap.

  • The left-wing France Unbowed (LFI) party announced it would file no-confidence motions against both budget plans, with support expected from the Communist and Green parties.


The Spin

Pro-establishment narrative

Bayrou's approach balances fiscal responsibility with social welfare, aiming to reduce the deficit while protecting essential services like education. The 2025 budget reflects this balance, ensuring France meets European standards and avoids financial penalties. By rejecting the no-confidence vote, Socialist lawmakers have shown they are pragmatic and willing to work within the system to achieve progress, safeguarding stability for the nation's future.

Establishment-critical narrative

Bayrou's reliance on Article 49.3 to push through his budget bypasses crucial parliamentary debate, undermining democratic scrutiny. His budget, despite claims of stability and cross-party agreement, hides deep flaws. While minor concessions were made to appease opposition, the broader fiscal approach leans heavily towards austerity. Reductions in vital areas like education and labor, combined with insufficient social spending, suggest a temporary fix that lacks long-term vision and credibility.

Nerd narrative

There is a 31.2% chance that Marine Le Pen will be elected French President in 2027, according to the Metaculus prediction community.

See sources

Trump Temporarily Delays Mexico, Canada Tariffs

The Facts

  • US Pres. Donald Trump on Monday agreed to pause the implementation of 25% tariffs on Mexican imports for one month following negotiations with Mexican Pres. Claudia Sheinbaum, who committed to deploying 10K National Guard troops to the US-Mexico border to combat drug trafficking and illegal migration. Likewise, Trump and Canadian Prime Minister Justin Trudeau separately announced a similar 30-day reprieve.

  • The agreements came hours before Trump's planned implementation of 25% tariffs on Mexico and Canada, along with 10% additional tariffs on China, which were scheduled to take effect Tuesday.

  • As part of the deals, the US committed to working on preventing the trafficking of high-powered weapons into Mexico, while Mexico focused on stopping the fentanyl flow into the US. Additionally, Trudeau stated that Canada had committed to appointing a "Fentynal Czar" as part of its border security commitments to the US.


The Spin

Republican narrative

Trump has claimed another negotiating victory that will secure the border and protect US citizens from the deadly fentanyl crisis while maintaining strong economic ties with Mexico and Canada. Trump's tariffs are proving to be effective in getting other countries to do the right things. This should put other nations on notice.

Democratic narrative

Trump has pulled another scam to make it seem like he won. Sheinbaum would be deploying troops to the border even without the tariff threat. It's more likely Trump saw the stock market drop and backed off the tariff threat in a panic. Hopefully, this gives the administration more time to consider how a tariff war will harm US consumers and its relationship with its neighbors.

Nerd narrative

There's a 10% chance that the US deploy military forces in Mexico without the cooperation of the Mexican government before 2029, according to the Metaculus prediction community.

See sources

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