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This Is the ‘Best Investment Environment Ever’, Says BlackRock’s CIO of Global Fixed Income Rick Rieder cited strong earnings, high yields and low volatility as drivers of today’s favorable investing climate, while warning complacency remains a risk. Updated Aug 16, 2025, 3:35 p.m. Published Aug 16, 2025, 3:00 p.m. Rick Rieder, BlackRock’s chief investment officer of global fixed income, said earlier this week the current backdrop represents the “best investment environment ever,” citing unusually favorable dynamics in both equity and bond markets. Speaking on CNBC, Rieder described “extraordinary” technical conditions in equities, with trillions of dollars still parked in money market funds and robust corporate buybacks shrinking available supply. While valuations for the market’s largest technology names remain elevated, he noted that earnings growth outside Tesla helped justify the multiples. “MAG-7 year-on-year growth is like 54%,” he said, adding that the pace makes the sector difficult to ignore. On the bond side, Rieder highlighted the appeal of income. Investors can still build portfolios yielding between 6.5% and 7%, a level he described as highly attractive in a world where inflation has drifted below 3% on a core basis. He argued that while the Federal Reserve has room to cut rates — potentially starting as soon as September — current yields already offer investors solid returns. ‘Crazy low’ volatility Rieder also emphasized today’s unusually subdued volatility. He described trading equity volatility, or “vol,” at levels near 9.5 to 10, which he called “crazy low.” Low volatility, he said, makes hedging against downside risk relatively cheap, giving investors what he called an “escape hatch” if conditions sour. “You don’t actually have to take the downside risk,” Rieder said. Still, Rieder cautioned that complacency is his biggest concern. With insurance in markets so inexpensive, he sees signs investors may be underestimating risks, particularly in credit spreads and other corners of fixed income. Fed’s interest rate On monetary policy, Rieder argued the Fed’s rate hikes have done little to suppress inflation, given that large corporations rely less on borrowing to finance investment. The real drag, he said, has been on housing activity and lower-income households that depend more heavily on credit. Keeping rates too high, he warned, risks imposing excessive costs on the government and households without meaningful disinflation gains. He believes the central bank could lower the funds rate by as much as 100 basis points over the coming year, a move he sees as unlikely to rekindle inflation given low structural volatility and rising productivity from advances in data, hyperscale computing and even space-related technologies. “There’s something spectacular happening around productivity,” he said, calling it a once-in-a-generation dynamic. For crypto investors, Rieder’s comments reinforce a broader narrative: an environment with falling rates, ample liquidity, and low volatility could support renewed appetite for risk assets beyond equities. If his call proves correct, the same technical tailwinds driving stocks higher could spill into digital assets that thrive on excess cash and investor risk-taking. Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy. Siamak Masnavi Siamak Masnavi is a researcher specializing in blockchain technology, cryptocurrency regulations, and macroeconomic trends shaping the crypto market. He holds a PhD in computer science from the University of London and began his career in software development, including four years in the banking industry in the City of London and Zurich. In April 2018, Siamak transitioned to writing about cryptocurrency news, focusing on journalism until January 2025, when he shifted exclusively to research on the aforementioned topics. AI Boost “AI Boost” indicates a generative text tool, typically an AI chatbot, contributed to the article. In each and every case, the article was edited, fact-checked and published by a human. Read more about CoinDesk’s AI Policy. More For You Adam Back’s $2.1B Bitcoin Treasury Play Set to Challenge MARA in BTC Holdings Bitcoin Standard Treasury Co.’s SPAC deal combines fiat financing and a bitcoin-denominated PIPE, aiming to debut on the Nasdaq with over 30,000 BTC and an aggressive growth plan. What to know: Founders are contributing 25,000 BTC, plus 5,021 BTC from early investors, with up to $1.5 billion in new capital. The company plans for active treasury management and rapid expansion beyond 50,000 BTC to challenge MARA Holdings’ hoard. Read full story Read More

Adam Back’s $2.1B Bitcoin Treasury Play Set to Challenge MARA in BTC Holdings Bitcoin Standard Treasury Co.’s SPAC deal combines fiat financing and a bitcoin-denominated PIPE, aiming to debut on the Nasdaq with over 30,000 BTC and an aggressive growth plan. Updated Aug 16, 2025, 5:22 p.m. Published Aug 16, 2025, 2:00 p.m. Bitcoin Standard Treasury Co. (BSTR), a bitcoin treasury vehicle led by cryptography pioneer Adam Back, sees itself as a company with a mission to accelerate real-world bitcoin adoption. But it might be setting out on another milestone: becoming one of the biggest corporate bitcoin holders. The company, which is preparing to go public on Nasdaq by merging with Cantor Equity Partners (CEPO), already has 30,021 BTC on its balance sheet, with plans to grow its stack beyond 50,000 coins. This will set it on the path of potentially overtaking MARA Holdings (MARA) as the second-largest corporate holder of BTC behind Strategy. MARA has more than 50,600 BTC, according to bitcointreasuries.net. Strategy has just under 629,000. Currently, MSTR, MARA, and BSTR collectively hold roughly 710,000 bitcoin, which represents about 3.38% of bitcoin’s fixed supply of 21 million. ‘Liquidity, security, and scale’ Unlike some corporate treasuries that sit on bitcoin passively, BSTR intends to use techniques that include selling puts to accumulate BTC at lower prices, using bitcoin-backed revolvers and placing collateral with regulated tri-party custodians. “We’re not interested in chasing DeFi yield or taking on counterparty risk we can’t manage. This is about liquidity, security, and scale,” Back said exclusively with CoinDesk. “Bitcoin was created as sound money and BSTR is being created to bring that same integrity to modern capital markets.” The SPAC deal with Cantor combines, for the first time, traditional Wall Street financing with a bitcoin-denominated private placement of equity (PIPE). In addition to 25,000 BTC contributed by the company’s founders, another 5,021 BTC will be raised from the bitcoin community. The company is also raising up to $1.5 billion in fiat financing, the largest PIPE ever announced alongside a bitcoin treasury SPAC merger. $400 million in common equity at $10 per share. Up to $750 million in convertible senior notes (30% conversion premium, $13 per share). Up to $350 million in convertible preferred stock with a 7% dividend and a $13 per share equivalent conversion price. CEPO could add up to $200 million from its trust, subject to redemptions. “By securing both fiat and bitcoin funding on day one, we are putting unprecedented firepower behind a single mission: maximizing bitcoin ownership per share while accelerating real-world bitcoin adoption,” Back said. A first for bitcoin treasuries The in-kind PIPE allows investors to deliver BTC at closing and potentially capture upside before settlement. Back said the approach was designed to appeal to both crypto-native players and traditional managers seeking exposure without waiting for post-close market buys. The firm’s CIO Sean Bill, who previously helped a U.S. pension fund make one of the first institutional allocations to BTC, said the strategy resonated with traditional investors. “We’re building the Berkshire Hathaway (BRK) of Bitcoin, an actively managed Treasury that will pursue yield and alpha strategies, and strategic acquisitions within the Bitcoin ecosystem”. “We’re flipping the script on Wall Street as we seek to fuse Bitcoin into Finance and Capital Markets, unlike other Treasury companies we’re not coming to Wall Street seeking fiat currency to buy Bitcoin, we’re showing up with a 25,000 Bitcoin commitment and more importantly we issued the first ever Bitcoin in kind Equity PIPE in the United States, raising another 5,021 Bitcoins from OG Bitcoiners. We’re brining the Bitcoin to Wall Street. We believe that the future of finance runs on Bitcoin”,” Bill told CoinDesk exclusively. Bridging bitcoin and Wall Street The leadership team sees BSTR as a bridge between the bitcoin ecosystem and institutional capital markets. “We’re bringing the traders, we’re bringing the bitcoiners to Wall Street,” Back said, noting the potential for the U.S. market’s liquidity to amplify the success of bitcoin-denominated convertibles that have already gained traction in Europe. The deal is expected to close in the fourth quarter, with the company trading under the reserved ticker BSTR. If the raise is fully subscribed, the launch could set a new scale record for corporate bitcoin treasuries and offer a template for others looking to merge sound money with modern market instruments. James Van Straten James Van Straten is a Senior Analyst at CoinDesk, specializing in Bitcoin and its interplay with the macroeconomic environment. Previously, James worked as a Research Analyst at Saidler & Co., a Swiss hedge fund, where he developed expertise in on-chain analytics. His work focuses on monitoring flows to analyze Bitcoin’s role within the broader financial system. In addition to his professional endeavors, James serves as an advisor to Coinsilium, a UK publicly traded company, where he provides guidance on their Bitcoin treasury strategy. He also holds investments in Bitcoin and Strategy (MSTR). X icon More For You This Is the ‘Best Investment Environment Ever’, Says BlackRock’s CIO of Global Fixed Income Rick Rieder cited strong earnings, high yields and low volatility as drivers of today’s favorable investing climate, while warning complacency remains a risk. What to know: Rieder said record cash on the sidelines, share buybacks and earnings strength make equities attractive despite lofty valuations. He cited fixed-income yields of 6.5%–7% and historically low volatility as key support for investors. He expects the Fed to cut rates in September, arguing high policy costs outweigh limited inflation benefits. Read full story Read More

XRP Ledger Used by Nasdaq-Listed Pharma Distributor to Power Payment System for Pharmacies The distributor is rolling out an XRPL-powered system for 6,500 pharmacies to speed up payments, cut costs, and expand blockchain use in healthcare finance. Updated Aug 16, 2025, 3:30 p.m. Published Aug 16, 2025, 11:00 a.m. Wellgistics Health Inc. is deploying an XRP Ledger-based payment system for thousands of pharmacies across the United States, deepening its bet on blockchain as it looks to overhaul healthcare finance. The Nasdaq-listed distributor (WGRX) has announced that its new platform enables independent pharmacies to pay for drug inventory and move funds instantly, bypassing banking delays and high credit card fees. Integrated with RxERP, a serialized pharmaceutical e-commerce and enterprise resource planning system, the program promises real-time tracking, lower costs, and direct settlement between pharmacies and distributors. Pharmacies can now enroll in the beta version of the program. The system is built on the XRP Ledger (XRPL), an open-source blockchain with core development led by Ripple Labs. With a network of more than 6,500 pharmacies and 200 manufacturers, Wellgistics is one of the first healthcare companies to launch an XRPL payment solution at scale. The firm’s CEO, Brian Norton, said pharmacy owners have embraced the initiative, calling them more forward-thinking on blockchain than many in the industry assume. The program enables pharmacies to settle invoices over XRPL, though Wellgistics has not disclosed whether participants must hold XRP directly or use fiat-to-XRP conversions for settlement. The program was designed to meet strict compliance standards, including HIPAA and anti-money laundering requirements. After the pharmacy roll-out, Wellgistics plans to extend the platform to manufacturers and test direct-to-patient programs, allowing medications to be shipped from drugmakers directly to patients under physician oversight. The initiative builds on a May 8 announcement that Wellgistics intends to use XRP not just for payments but also as a treasury reserve asset. That plan is backed by a $50 million equity line of credit, which management said would support programmable liquidity and on-demand financial infrastructure across its healthcare network. Founded as Wellgistics LLC in 2016, the company was acquired by Danam Health in September 2024 before being spun off through an initial public offering in February 2025. Today, Wellgistics Health operates as a standalone Nasdaq-listed entity, providing wholesale distribution, prescription routing, and AI-powered hub services to pharmacies nationwide. Shares have dropped more than 80% since the February debut. They closed Tuesday at $0.62, down 7%, before rising to $0.65 in after-hours trading. The company’s current market cap is around $47 million. By linking pharmacy payments to the XRP Ledger while preparing to hold XRP on its balance sheet, Wellgistics is aiming to position itself as both a user and financial backer of the blockchain. Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy. Siamak Masnavi Siamak Masnavi is a researcher specializing in blockchain technology, cryptocurrency regulations, and macroeconomic trends shaping the crypto market. He holds a PhD in computer science from the University of London and began his career in software development, including four years in the banking industry in the City of London and Zurich. In April 2018, Siamak transitioned to writing about cryptocurrency news, focusing on journalism until January 2025, when he shifted exclusively to research on the aforementioned topics. AI Boost “AI Boost” indicates a generative text tool, typically an AI chatbot, contributed to the article. In each and every case, the article was edited, fact-checked and published by a human. Read more about CoinDesk’s AI Policy. More For You Gemini Hires Goldmans, Citi, Morgan Stanley and Cantor as Lead Bookrunners For its IPO The company said its net revenue for the first six months of 2025 was $67.9 million, against a net loss of $282.5 million. What to know: Goldman Sachs, Citigroup, Morgan Stanley and Cantor are acting as lead bookrunners on the planned Gemini IPO. Gemini intends to list its Class A common stock on the Nasdaq Global Select Market under the ticker symbol GEMI. Read full story Read More

Crypto Hackers Capitalize on ETH Surge, Offloading $72M This Week Three high-profile exploiters have taken advantage of ether’s rally to liquidate stolen funds, pocketing tens of millions in extra profits. Updated Aug 15, 2025, 2:39 p.m. Published Aug 15, 2025, 2:13 p.m. Ether’s (ETH) recent rally to $4,780 has delivered a wealth of profits to several high-profile hackers, who have capitalized on the surge by offloading their ill-gotten gains. In three separate case, on-chain data, revealed by X account EmberCN, shows hackers strategically liquidated their ETH holdings for tens of millions in profit. The Radiant Capital exploiter, who the protocol alleges is a North Korean entity, drained around $53 million in assets from the DeFi protocol last October. They converted much of their haul into 21,957 ETH at roughly $2,414 per coin, only to sell 9,631 ETH for $44 million worth of stablecoins this week. They still control 12,326 ETH alongside the stablecoin proceeds, for a combined $101 million, around $48.3 million more than the value of the original stolen assets. A similar playbook emerged from the Infini exploit in February. That attacker siphoned $49.5 million in USDC and bought 17,696 ETH at $2,798 each. While laundering 5,000 ETH through Tornado Cash, they also sold 3,540 ETH for $13 million worth of stablecoins at an average $3,762. The ETH rally has swelled the value of their remaining stash, netting an extra $25.15 million on top of the initial theft. The third case was an unidentified exploiter who stole 17,412 ETH from THORChain and Chainflip in March sold those holdings for $33.9 million DAI at $1,947. In June, they re-entered the market, buying 4,957 ETH at $2,495 before selling them early Friday for $22.13 million worth of stablecoins at $4,464, profiting $9.76 million in the process. The three hacks all played part in a rampant 18 months for hackers, with investors losing $3.1 billion in in the first half of 2025 and $1.49 billion in 2024. Oliver Knight Oliver Knight is the co-leader of CoinDesk data tokens and data team. Before joining CoinDesk in 2022 Oliver spent three years as the chief reporter at Coin Rivet. He first started investing in bitcoin in 2013 and spent a period of his career working at a market making firm in the UK. He does not currently have any crypto holdings. X icon More For You Gemini Hires Goldmans, Citi, Morgan Stanley and Cantor as Lead Bookrunners For its IPO The company said its net revenue for the first six months of 2025 was $67.9 million, against a net loss of $282.5 million. What to know: Goldman Sachs, Citigroup, Morgan Stanley and Cantor are acting as lead bookrunners on the planned Gemini IPO. Gemini intends to list its Class A common stock on the Nasdaq Global Select Market under the ticker symbol GEMI. Read full story Read More

Canada’s government forced Air Canada and its striking flight attendants back to work and into arbitration Saturday after a work stoppage stranded more than 100,000 travelers around the world during the peak summer travel season. Federal Jobs Minister Patty Hajdu said now is not the time to take risks with the economy, noting the unprecedented tariffsthe U.S. has imposed on Canada. The intervention means the 10,000 flight attendants will return to work soon. The government’s action came less than 12 hours after workers walked off the job. “The talks broke down. It is clear that the parties are not any closer to resolving some of the key issues that remain and they will need help with the arbitrator,” Hajdu said. Hajdu said the full resumption of services could take days, noting it is up to the Canada Industrial Relations Board. Meanwhile, Wesley Lesosky, president of the Air Canada Component of the CUPE union, accused the government of violating the flight attendants’ constitutional right to strike — and decried Hajdu for only waiting hours to intervene. “The Liberal government is rewarding Air Canada’s refusal to negotiate fairly by giving them exactly what they wanted,” Lesosky said. Air Canada did not immediately have additional comments when reached Saturday afternoon. But Air Canada Chief Operating Officer Mark Nasr previously said it could take up to a week to fully restart operations. It’s likely that travelers will continue to see disruptions in the coming days. Existing agreement will stay in place through arbitration The shutdown of Canada’s largest airline early Saturday is impacting about 130,000 people a day, and some 25,000 Canadians may be stranded. Air Canada operates around 700 flights per day. According to numbers from aviation analytics provider Cirium, Air Canada had canceled a total of 671 flights by Saturday afternoon — following 199 on Friday. And another 96 flights scheduled for Sunday were already suspended. Hajdu ordered the Canada Industrial Relations Board to extend the term of the existing collective agreement until a new one is determined by the arbitrator. “Canadians rely on air travel every day, and its importance cannot be understated,” she said. Union spokesman Hugh Pouliot didn’t immediately know what day workers would return to work. “We’re on the picket lines until further notice,” he said. The bitter contract fight escalated Friday as the union turned down Air Canada’s prior request to enter into government-directed arbitration, which allows a third-party mediator to decide the terms of a new contract. ‘Such little progress has been made’ Flight attendants walked off the job around 1 a.m. EDT on Saturday. Around the same time, Air Canada said it would begin locking flight attendants out of airports. Ian Lee, an associate professor at Carleton University’s Sprott School of Business, earlier noted the government repeatedly intervenes in transportation strikes. “They will intervene to bring the strike to an end. Why? Because it has happened 45 times from 1950 until now,” Lee said. “It is all because of the incredible dependency of Canadians.” Last year, the government forced the country’s two major railroads into arbitration with their labor union during a work stoppage. The union for the rail workers is suing, arguing the government is removing a union’s leverage in negotiations. The Business Council of Canada had urged the government to impose binding arbitration in this case, too. And the Canadian Chamber of Commerce welcomed the intervention. “With valuable cargo grounded and passengers stranded, the government made the right decision to refer the two sides to binding arbitration,” said Matthew Holmes, the executive vice president for the Chamber of Commerce — adding that “close to a million Canadians and international visitors could be impacted” if it takes Air Canada a week to be fully operational again. Hajdu maintained that her Liberal government is not anti-union, saying it is clear the two sides are at an impasse. Travelers in limbo Passengers whose flights are impacted will be eligible to request a full refund on the airline’s website or mobile app, according to Air Canada. The airline said it would also offer alternative travel options through other Canadian and foreign airlines when possible. Still, it warned that it could not guarantee immediate rebooking because flights on other airlines are already full “due to the summer travel peak.” Many travelers expressed frustration over Air Canada’s response to the strike. Jean‐Nicolas Reyt, 42, said he had heard little from Air Canada just hours before his upcoming flight from France scheduled for Sunday. “What’s stressful is to not hear anything from Air Canada,” said Reyt, who is trying to return to Montreal, where he is an associate professor of organizational behavior at McGill University. He said he only received one email from the airline on Thursday warning of potential strike disruptions, but had no further information as of Saturday evening in Cannes, where he was visiting family. Reyt assumes his upcoming flight could be canceled — much like the scores of other lengthy disruptions this weekend. “I’m just very surprised that Air Canada let it go this far,” he said. “It’s really a bit disheartening that they fly you somewhere abroad and then they just don’t fly you back.” Jennifer MacDonald, of Halifax, Nova Scotia, expressed similar frustration. She has been trying to help her brother and cousin get home to Edmonton, Alberta since the second leg of their Air Canada trip was canceled during what was supposed to be a 1-hour layover in Montreal on Friday night. The two had to pay $300 out of their own pocket for a hotel, MacDonald said. All Saturday morning, they tried to look for rebooking options, but everything was sold out, she added. Eventually, they opted to book a new flight for Aug. 22 out of Halifax, with another family member volunteering to make an eight-hour drive to pick them up in Montreal and bring them back east on Saturday. “It will be a multiday ordeal and a multi thousand dollar trip,” MacDonald said. But as stressful as the disruptions have been, she added that her family stands

Current and former OpenAI employees plan to sell approximately $6 billion worth of shares to an investor group that includes Thrive Capital, SoftBank Group Corp. and Dragoneer Investment Group, in a deal that values the ChatGPT maker at $500 billion, according to people familiar with the matter. The talks are early and the size of the share sale could still change, said the people, who asked not to be identified discussing private information. The secondary share investment is on top of SoftBank’s commitment to lead OpenAI’s $40 billion funding round, which values the company at $300 billion, according to another person familiar with the deal. That round remains ongoing, with OpenAI recently securing $8.3 billion from a syndicate of investors. Representatives for Dragoneer and Thrive didn’t respond to requests for comment. Spokespeople for OpenAI and SoftBank declined to comment. All three firms are existing OpenAI backers. The secondary share sale, which was first reported by Bloomberg, will give OpenAI employees a chance to get cash-rich amid a high-stakes talent war in the artificial intelligence industry. Companies like Meta Platforms Inc. are offering massive salaries to recruit AI talent from OpenAI and other startups. This year, several OpenAI employees have exited for Meta, including Shengjia Zhao, a co-creator of ChatGPT. Allowing employees to sell shares is an important tool for startups trying to retain top talent, without requiring the company to go public or be acquired. In some cases, early investors also use these deals to sell down their stakes, though OpenAI investors are not eligible to do so in this round, according to a person familiar with the matter. Current and former employees who spent at least two years at the company are able to participate. With its participation in the share sale, as well as its previous commitments, SoftBank is making a pivotal bet on the success of OpenAI. In addition to those deals, the Japanese conglomerate headed by Masayoshi Son recently closed a separate $1 billion purchase of OpenAI employee shares at a $300 billion valuation, according to a person familiar with the matter. Negotiations for that deal started before talks around the $500 billion secondary valuation began, they said. The $500 billion valuation would make OpenAI the world’s most valuable startup, surpassing Elon Musk’s SpaceX. The company expects revenue to triple this year to $12.7 billion, up from $3.7 billion in 2024, Bloomberg has reported. And the secondary deal talks come on the heels of the release of its highly-anticipated GPT-5 model.  This week, OpenAI chief Sam Altman sat down with a group of reporters and shared his vision for the company, including that it wants to spend trillions of dollars on the infrastructure required to run AI services in the “not very distant future.” “You should expect a bunch of economists to wring their hands and say, ‘This is so crazy, it’s so reckless,’ and whatever,” Altman said. “And we’ll just be like, ‘You know what? Let us do our thing.’” Introducing the 2025 Fortune Global 500, the definitive ranking of the biggest companies in the world. Explore this year’s list. Read More

The Trump administration sees complete disaster for the U.S. economy if its reciprocal tariffs are struck down, revealing its level of concern as a court is expected to issue a critical decision soon. On July 31, a federal appeals court heard arguments in a case challenging the tariffs’ legal basis under the International Economic Emergency Powers Act (IEEPA), and the judges expressed deep skepticism about the administration’s side. In a note this past week, James Lucier at Capital Alpha Partners said a decision is expected by the end of September, but could come as soon as late August. A unanimous or near-unanimous ruling could give the Supreme Court cover to avoid taking the case immediately and reject the administration’s request to issue a stay that would keep the tariffs in place in the meantime. The dire warnings also represent “a remarkable change in tune by the administration, which until now has always insisted that it had legal authority to get the deals done one way or another even if the IEEPA tariffs were struck down,” he added.  Trump’s “Liberation Day” tariffs helped leverage a series of trade deals, including an agreement with the European Union, which pledged to invest $600 billion in the U.S. and buy $750 billion worth of U.S. energy products, with “vast amounts” of American weapons in the mix. Similarly, the U.S.-Japan trade deal entails $550 billion of investments from Tokyo. ‘Financial ruin’ The U.S. hasn’t received immediate cash transfers in those amounts. Still, in a letter to the U.S. Court of Appeals for the Federal Circuit on Monday, Justice Department officials suggested the government would suddenly owe everyone money—leading to catastrophe. “The President believes that our country would not be able to pay back the trillions of dollars that other countries have already committed to pay, which could lead to financial ruin,” wrote Solicitor General D. John Sauer and Assistant Attorney General Brett Shumate. They also warned that unwinding the trade deals would lead to a “1929-style result.” That echoed a post from Trump on Truth Social days earlier, when he predicted another Great Depression would hit America if the court rules against his tariffs. Sauer and Shumate turned up the volume even higher in their subsequent letter, elaborating further on the depression warning. “In such a scenario, people would be forced from their homes, millions of jobs would be eliminated, hard-working Americans would lose their savings, and even Social Security and Medicare could be threatened,” they wrote. “In short, the economic consequences would be ruinous, instead of unprecedented success.” ‘The president is in a jam’ To be sure, the government has generated significant tariff revenue since April, and importers who paid the reciprocal duties could seek reimbursement if they are struck down. But that’s only about $100 billion and also includes revenue from sectoral tariffs that were imposed under a separate legal basis that’s not at risk. “The real problem, the letter implies, is that Trump does not have legal authority to replicate the IEEPA tariffs under other tariff statutes if the court strikes the IEEPA tariffs down,” Lucier explained. “In other words, the president is in a jam because if the court strikes down the IEEPA tariffs, his trade deals have no legal basis.” A note from Yardeni Research on Wednesday also pointed out that the administration is becoming increasingly concerned about losing the court case. The letter from the Justice Department officials appears to anticipate that they will lose the case as they are asking for a stay if the court goes against them. There will be “messy” consequences if reciprocal tariffs are struck down, according to Yardeni, as Trump needs the revenue from tariffs to reduce the budget deficit and help to lower bond yields. “If he loses in court, these yields might move higher. Stock prices might decline on this news initially due to a new round of policy uncertainty,” the note said. “So the dire tone in the letter is understandable, even though it is a wee bit over the top.” Introducing the 2025 Fortune Global 500, the definitive ranking of the biggest companies in the world. Explore this year’s list. Read More

The latest consumer price index report showed airfares jumped 4% in July from the prior month, reversing a slump that began early this year. That’s as airlines are reducing the number of flights, easing a capacity glut, while demand has rebounded after President Donald Trump’s trade war slowed travel during the spring. Supply and demand are coming back into balance in the airline industry, meaning airfares are shooting higher again after an extended downtrend. The latest consumer price index report showed airfares jumped 4% in July from June, marking the first monthly increase since January. For much of the peak travel season, consumers enjoyed lower prices. Airfares ticked down 0.1% in June and fell 2.7% in May from the prior month. But those days look to be over for now. Airlines are trimming flights more aggressively than usual as the summer winds down. Domestic capacity among U.S. airlines has dropped 6% in August versus July, according to data from Cirium cited by CNBC. That’s bigger than the cut of just over 4% during the same period a year ago as well as the 0.6% cut in 2023. And in the pre-COVID summer of 2019, capacity fell by 1.7% between July and August. The strike at Air Canada could throw another wrench into capacity as the carrier suspends operations. Canada’s top airline operates around 700 flights per day. Earlier this summer, airlines found themselves with too much capacity as their expectations at the start of the year for another travel boom slammed into President Donald Trump’s trade war in the spring. After he unveiled much steeper-than-expected tariffs in April, demand for flights slowed as consumers turned cautious about the economy and their finances. To avoid flying empty planes, airlines slashed prices. But Trump pulled back from his highest levies and signed several trade deals. With some uncertainty easing, airlines have reported that demand is rebounding. In fact, security screenings at airports in July and so far in August are up from a year ago. “The world is less uncertain today than it was during the first six months of 2025 and that gives us confidence about a strong finish to the year,” United Airlines CEO Scott Kirby said last month. Introducing the 2025 Fortune Global 500, the definitive ranking of the biggest companies in the world. Explore this year’s list. Read More

The federal budget deficits caused by President Donald Trump’s tax and spending law could trigger automatic cuts to Medicare if Congress does not act, the nonpartisan Congressional Budget Office reported Friday. The CBO estimates that Medicare, the federal health insurance program for Americans over age 65, could potentially see as much as $491 billion in cuts from 2027 to 2034 if Congress does not act to mitigate a 2010 law that forces across-the-board cuts to many federal programs once legislation increases the federal deficit. The latest report from CBO showed how Trump’s signature tax and spending law could put new pressure on federal programs that are bedrocks of the American social safety net. Trump and Republicans pledged not to cut Medicare as part of the legislation, but the estimated $3.4 trillion that the law adds to the federal deficit over the next decade means that many Medicare programs could still see cuts. In the past, Congress has always acted to mitigate cuts to Medicare and other programs, but it would take some bipartisan cooperation to do so. Democrats, who requested the analysis from CBO, jumped on the potential cuts. “Republicans knew their tax breaks for billionaires would force over half a trillion dollars in Medicare cuts — and they did it anyway,” said Rep. Brendan F. Boyle, the top Democrat on the House Budget Committee, in a statement. “American families simply cannot afford Donald Trump’s attacks on Medicare, Medicaid, and Obamacare.” Hospitals in rural parts of the country are already grappling with cuts to Medicaid, which is available to people with low incomes, and cuts to Medicare could exacerbate their shortfalls. As Republicans muscled the bill through Congress and are now selling it to voters back home, they have been highly critical of how CBO has analyzed the bill. They have also argued that the tax cuts will spur economic growth and pointed to $50 billion in funding for rural hospitals that was included in the package. Introducing the 2025 Fortune Global 500, the definitive ranking of the biggest companies in the world. Explore this year’s list. Read More

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