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Good morning. Today we’ll be covering:
Musk’s rebuke of Trump’s “big, beautiful” bill
McKinsey’s steep headcount cuts
Brazil’s diplomatic battle against US sanctions on one of its judges
What makes the perfect cheeseburger
Good morning. Elon Musk has slammed US President Donald Trump’s “big, beautiful” tax bill, claiming it “undermines” the so-called Department of Government Efficiency’s cost-cutting work by increasing the fiscal deficit.
What Musk said: In a preview of an interview with CBS Sunday Morning released late yesterday, the Tesla chief executive said he was “disappointed to see the massive spending bill, which increases the budget deficit . . . and undermines the work that the Doge team is doing . . . I think a bill can be big, or it can be beautiful. But I don’t know if it can be both.”
Why it matters: The comments are Musk’s strongest rebuke of the Trump administration to date, and reveal one of the tensions within the GOP between Trump and Republicans who want the administration to be more hawkish on the deficit. The president had to browbeat several congressional holdouts to back the bill, which non-partisan groups say will increase public debt by $3.3tn. Musk pulled back from his role at Doge last month to focus on his business endeavours, saying he had “done enough” to support political causes.
Art of the barter: The president has offered Canada free protection from the US’s ambitious “Golden Dome” missile defence shield if the country relinquishes its sovereignty.
Touchdown troubles: Musk’s company SpaceX suffered another setback yesterday, after its Starship rocket failed to deliver its payload and exploded on re-entry.
Here’s what else we’re keeping tabs on today:
Economic data: The US Federal Reserve publishes minutes from its last rate-setting meeting.
Oil: Opec and the non-Opec ministerial monitoring committee meet to review production output policy.
Results: Nvidia, HP and Salesforce report.
Five more top stories
1. European Central Bank President Christine Lagarde discussed cutting short her term at the bank to become chair of the World Economic Forum, the think-tank’s founder Klaus Schwab said. Schwab told the Financial Times that a Switzerland apartment had already been reserved for her. An ECB spokesperson said Lagarde was “determined to complete her term”.
2. McKinsey has cut more than 10 per cent of its staff in the past 18 months, reversing a big expansion plan that peaked during the pandemic. The job cuts, among the largest in McKinsey’s nearly 100-year history, reflect the sharp slowdown in revenue growth across the consulting market.
3. Listed companies are increasingly buying bitcoin, after its huge rally and the Trump administration’s favourable stance towards digital assets tempt investor appetite. Many firms are trying to emulate the success of software company Strategy, which has accumulated 580,000 bitcoin and commands a market value of more than $100bn.
4. Saudi Arabia’s new state-owned artificial intelligence venture will seek investment from US Big Tech companies as it aims to turn the kingdom into a global AI hub. Humain’s chief executive said he was in talks with OpenAI, Musk’s xAI and Andreessen Horowitz. Andrew England and Ahmed Al Omran have more details from Riyadh.
5. A US private military contractor has hired an obscure Palestinian group to staff its aid distribution centres in Gaza under a controversial, Israel-backed scheme. Safe Reach Solutions — run by an ex-CIA officer — had approached prominent local businessmen to run the hubs, but they refused to participate, arguing that doing so would amount to forced displacement of people in the enclave.
The Big Read
Launched a decade ago, Beijing’s “Made in China” industrial policy sought to achieve 70 per cent domestic market share across Chinese manufacturing of “core basic components and key basic materials” by 2025. Today, its aggressive investments in domestic production have successfully established the country as a supply chain leader — but at what cost?
We’re also reading . . .
Curiosity’s value: We must recognise and protect the pipelines that lead from scientific research to real-world benefit, writes Anjana Ahuja.
401k plans: Should ordinary US retirement accounts be investing in private assets? Even some in private equity are worried, writes Brooke Masters.
Brasília’s battle: Brazil is fighting to stop the US imposing sanctions on one of its supreme court judges, who is overseeing the prosecutorial case against ex-president Jair Bolsonaro for allegedly plotting a coup.
Chart of the day
Russia’s wartime economy has padded out pay packets, according to FT analysis — and bolstered domestic support for the war in Ukraine.
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Take a break from the news
What makes the perfect cheeseburger? One chef says it’s all about the patty: “You need the perfect synthesis of aged beefy funk, bold assertive savour, a firm meaty density, but a forgiving and indulgent yield on the bite.” HTSI grills the experts.
