Business

➚ BUY: Copper. Glencore will use new technology to pull more of the metal, which is key to components used in AI data centers, out of lower-quality ore.

➘ SELL: Chrome. US regulators will ask a federal judge to force Google to sell its Chrome browser after winning a monopoly trial against the tech giant, according to Bloomberg, which says it could fetch $20 billion. (Google says the ask “goes far beyond the legal issues in this case.”)

⇌ HOLD: Steel. Shares of U.S. Steel soared on Trump’s win then sank on takeover jitters, and Nippon executives are now in Pittsburgh trying to win over the union. “A country that’s afraid of working with its friends looks weak and paranoid,” the hometown Post-Gazette writes.

Truth Social to buy crypto exchange… Trump meets Coinbase CEO… Musk tried to buy Substack… Nvidia chips are hot collateral… Ken Griffin’s Miami mystery…

Treasury race gets dirty

THE SCOOP

Cherrypicked returns from US Treasury Secretary candidate Scott Bessent’s investment firm were flying around Wall Street group chats Monday, a sign of the mudslinging that has accompanied the race for the highest-profile vacancy in Donald Trump’s cabinet.

A document being shared in WhatsApp threads and Bloomberg chats shows that Bessent’s firm, Key Square, lost money five of the past seven years during a generally profitable run for funds like it. Semafor has confirmed the numbers, which aren’t public because Key Square is a private investment firm.

But they exclude big profits in 2016, Key Square’s first year, as well as 2017 and 2024, a person familiar with the matter said. Macro funds like Key Square aren’t stock-pickers, but rather use bonds, currencies, commodities and other instruments to wager on global trends.

Poor performance would undercut one of Bessent’s key selling points in the race for Treasury — that he’s a gifted investor with a finger on the pulse of the world economy.

It’s the latest shot fired in an ugly personnel battle that has captivated Wall Street. The Treasury post is the most senior cabinet job still unfilled, and one that would be central to Trump’s economic priorities like tax cuts and tariffs.

Howard Lutnick, the billionaire CEO of brokerage Cantor Fitzgerald who made a late charge against frontrunner Bessent, is now expected to be named Commerce Secretary, reports Punchbowl’s Jake Sherman. It’s a consolation role previewed by Semafor yesterday. Lutnick’s push for Treasury had thrown that race into chaos and brought Bessent’s defenders, including Sen. Lindsey Graham, into the lobbying effort.

A representative for Bessent declined to comment.

A field of half a dozen contenders had narrowed into a two-man race between Bessent and Lutnick, though Apollo CEO Marc Rowan remains in the mix, as Semafor reported earlier this month, as do Sen. Bill Hagerty and former Federal Reserve official Kevin Warsh.

The Trump team is culling its list of candidates to run financial regulatory agencies, people familiar with the process said.

• Jonathan McKernan, one of two current Republicans on the FDIC board, may be tapped for the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac. Getting the two mortgage giants out of government conservatorship, where they’ve been since 2008, and back into shareholders’ hands has been a long-time goal of conservatives. The combined agencies have about half the $300 billion in capital that the Biden administration said they need to go public, though a Trump appointee could waive that. “The conservatorship was supposed to be temporary, to allow time for both Fannie and Freddie to rebuild their capital,” Trump economic adviser John Paulson told Semafor. “They have.”
• Brian Johnson and Craig Phillips are among those under consideration to run the Consumer Financial Protection Bureau. Johnson was a deputy director at the CFPB during Trump’s first presidency, while Phillips served as counselor to the Treasury Secretary during that time. While financial regulation isn’t high on Trump’s stated agenda — Project 2025 suggested getting rid of the CFPB entirely — Trump supports a cap on credit card fees, which would likely land on the agency’s plate. (He has a willing partner in Sen. Bernie Sanders.)
• Jelena McWilliams has expressed interest in Fed Vice Chair Michael Barr’s job, but not if it means stepping into a messy political drama that could undermine independence of the Fed — i.e. if Barr gets fired or demoted. McWilliams faced her own personnel drama in the Biden administration, when she was essentially pushed out as chair of the FDIC in 2022 by the Democratic members of the agency’s board.

A Blackstone deal in the market today shows just how eager investors are to lend, which, depending on the tint of your glasses, shows investors’ confidence in the economy or their risk appetite from being flush with cash.

When Blackstone bought Emerson Electric’s climate-tech unit two years ago, banks were closed for business, choking on debt from Twitter’s messy buyout and wary of a coming recession. Blackstone’s duct-taped deal included $2.25 billion borrowed from Emerson itself — the corporate equivalent of writing a personal mortgage to the buyer of your home. The rest of the debt charged 6.75 percentage points over a baseline rate.

Today, the company is finalizing a new loan at just 2.75 percentage points above that rate to pay Blackstone a dividend, people familiar with the transaction said. It’s borrowing $675 million, but more was on offer.

Investors are eager to put billions of dollars raised in recent years to work. And with few buyout deals happening, supply of cash is outstripping the demand. That’s letting companies in decent health borrow at prices that would have been unthinkable earlier this year.

“People are worried about the price of food now? Wait until [food producers] can’t get workers.”

— An immigration attorney, to the FT, which reports that companies are hiring lawyers to check the legal status of their workers.

The stock market’s rocketship is sputtering. Since the election, semiconductor shares have fallen on sluggish outlook for electric vehicles and concerns about Trump’s tariffs, according to Bank of America analysts. The president-elect has called the bipartisan CHIPS Act a “bad” deal, but experts think he’s more likely to modify the law than to repeal it.

Look ahead: Quarterly earnings tomorrow from Nvidia, whose shares are down on news of overheating chips melting servers. Options trading shows investors braced for a $300 billion price swing in either direction.

MicroStrategy bought more bitcoins, doubling down on its status as a publicly traded crypto hoarder. The software company, which pays its board members in crypto, now owns $30 billion of bitcoin and swapped its once-staid shareholder base for an army of believers. MicroStrategy is trading at a 157% premium today to the value of its bitcoins, which makes it an expensive way to own crypto. It’s also costly to own the enterprise software firm, trading at a 4,540% premium to companies with comparable revenue. Meme on.

Bitcoin enthusiasts are expecting much from a Trump presidency, starting with a crypto-friendly head of the Securities and Exchange Commission. A blockchain lobbying group upped the pressure yesterday on sitting chair Gary Gensler to resign.

Republicans are waging their own internal fight over the next FBI director, a clash that pits a Donald Trump loyalist against a former congressional intelligence chairman who’s well liked on Capitol Hill, Semafor’s Shelby Talcott and Burgess Everett reported.

The FBI director is a particularly sensitive position for Trump, who fired former Director James Comey and is expected to quickly try to replace Wray, Comey’s successor.