Crypto News: Wild ride

Good morning. Donald Trump's latest musings catch the world's attention. We have the latest developments on the Los Angeles fires. And now we know the perfect way to show off your wealth. Listen to the day's top stories.

Markets Snapshot

S&P 500 Futures

5,945.75

Bloomberg Dollar Spot Index

1,312.78

+0.48%

Market data as of 07:14 am EST.

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The Reindeer Glacier near Kangerlussuaq, Greenland. Photographer: Mario Tama/Getty Images

Donald Trump's power grab for control of Greenland (the world's biggest island, in case you weren't sure) and musings about using "economic force" to absorb Canada as a US state are a fresh reminder of how rocky executing his trade agenda could prove. The unprecedented threats toward allies underscored Trump's appetite for risk. But aides within the president-elect's team have wildly divergent views on how best to accomplish his vision.

While this all plays out, a cohort of about 20 Republican House members from New York, New Jersey and California will meet with Trump on Saturday to discuss increasing the $10,000 cap on state and local tax deductions. Trump's economic advisers are considering doubling the deduction to $20,000, which would provide big savings to many residents.

How Likely Is US Exceptionalism to Continue?

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Elon Musk is also busy, and setting his sights on Europe. The unelected South Africa-born multibillionaire is using his X platform to slam democratically chosen European leaders, including Germany's Olaf Scholz and the UK's Keir Starmer, accusing the latter of complicity in a decades-old child sexual abuse scandal. His actions have raised the hackles of several governments and left them unsure how to respond.

When you need a friend. Samsung shares rose after Nvidia founder Jensen Huang expressed confidence in the Korean company's ability to resolve technical issues producing a new type of memory chip for AI systems. Staying social, Huang said he would be "delighted" to meet Trump. Click here to watch his interview at the CES show in Las Vegas.

Markets are catching their breath, with equity futures signaling a rebound for US stocks after yesterday's sharp decline in Big Tech. If you're a player in the bond market (or aspire to be one), 10-year Treasury yields may rise further to 5% as the economy hums along, according to Citigroup's wealth division. That would be a buying opportunity. But beware. Last time bond yields surged like this, stocks sank.

Developing Story: California Wildfires

Firefighters battle flames in the Pacific Palisades neighborhood of Los Angeles Photographer: Kyle Grillot/Bloomberg

Here's the latest as wildfires are burning out of control in the Los Angeles region, fueled by extreme winds, forcing thousands of residents to evacuate.

There are multiple blazes, including the Palisades fire, which has spread across almost 3,000 acres, and others in Eaton Canyon and northwest of LA, all of which are uncontained.
Mandatory evacuation orders are in place, and widespread power outages have occurred, with over 200,000 customers affected, as strong winds and dry conditions hinder firefighting efforts.

The Big Take

Markets Sound Alarm Over Deflationary Spiral in China

Investors are increasingly concerned that China risks sliding into an economic malaise that could last decades.

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Opinion

Another edifice of the post-Volcker era of stability is cracking, John Authers writes. It might make sense to get used to the notion that bond yields will tend to trend up for the foreseeable future, not down.

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Katja Hoyer

How 'Far Right' Is Germany's AfD Party?

Matthew Brooker

Everyone Wants a Silicon Valley Wealth Machine

Before You Go

A screengrab of Zuckerberg's video shows the watch on his left wrist. Source: facebook.com/zuck

Sign of real wealth. Mark Zuckerberg wore a rare Greubel Forsey 'Hand Made 1' watch worth about $900,000 in yesterday's video explaining Meta's decision to end third-party fact checking. Only two or three models are produced each year.

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