| | Good morning and happy Monday. Today is Presidents' Day and this week could be a decisive one for "Liberation Day." The Supreme Court has scheduled its next round of opinions for Friday, raising the possibility that justices will rule on the legality of President Donald Trump's tariffs. Trump placed levies ranging from 10% to 50% on most imports beginning last April, and the court heard expedited arguments in a case opposing them in November. But SCOTUS only announces what dates it will issue opinions, not the cases that will be addressed. That means it's possible that justices do not hand down a tariff ruling on Friday and businesses, importers and court watchers will have to wait until February 24 and 25, the next two days scheduled for decisions (or possibly all the way until this summer, when the current SCOTUS term concludes). It's a cruel way to do things for those with agnostophobia, or fear of the unknown, who in this case are not just scared, they're tarrified. | | | | | | | | The S&P 500 finished last week down 1.5%, the Dow Jones Industrial down 1.4% and the tech-heavy Nasdaq down 2.2%. Markets have pulled back from record levels as an AI-induced selloff has investors thinking more like Harlan Ellison and William Gibson, worrying what present and future techno-disruptions are in store. But then there's Bill Ackman. His Pershing Square made the case that there's Warren Buffett-like value hunting to be done, with payoffs from one AI behemoth in particular. A Ten Percent Bet Shares in trucking and logistics companies, software firms, and insurance and real estate brokers have unloaded by investors worried that their traditional businesses are kaput. The mere appearance of a new Chat-GPT-based app can send shares in a sector (temporarily) down double digits. The environment has been complicated by stronger-than-expected jobs data, which raised the prospect that the Federal Reserve could comfortably hold off on rate cuts in the short term to focus on lowering inflation. But, on Friday, inflation dropped to a near five-year low, opening the door to deeper rate cuts. Which is where Ackman's hedge fund Pershing, among the market's most vaunted value investors, comes in. The firm is known for taking big, concentrated positions, suggesting a high degree of confidence (go big or go broke… well, broke's not so much in the cards when you're worth $8.4 billion). It has worked very well: Pershing returned 34% last year, well ahead of the S&P 500's 17.9% and marking the latest in a near-decade-long streak of besting the index. At its investor presentation last week, it laid out the case for one big position that Ackman argued cuts through the noise of the market's AI-nxiety: - Ackman revealed a $2 billion stake in Mark Zuckerberg's social media giant Meta, a big enough swing to account for about 10% of the hedge fund's portfolio. While Meta has returned over 500% since the start of 2023, it's actually been in a rut for some time, down 12% in the last 12 months.
- Meta's plans to spend $115 billion to $135 billion on capital expenditures in 2026 has worried some investors that the heavy AI spending may not pay off. But its use of AI to make its mammoth ad business more efficient — the average price per ad rose 6% in the fourth quarter of 2025 — which led Ackman to assert "concerns around Meta's AI-related spending initiatives are underestimating the company's long-term upside potential from AI." The Buffett-like value position rests partly in the fact that Meta trades at 27.3 times earnings, better than many of its big ticket tech peers.
  Make Up Your Own Mind: Pershing jumped on the Amazon bandwagon last April, when the online retailer dipped after the US placed tariffs on most imports, marking a bet that quickly paid off. But its balance sheet is not gospel: late last year, it exited bad bets on Chipotle and Nike, the latter of which cost more than $600 million. Written by Sean Craig | | | | | | | | | Photo via Betterment | Invest with Betterment's automated and tax efficient tools (like tax-loss harvesting) that do the work and help you keep more of your after-tax returns. Put surprise tax bills in the past. Unlike other investing apps, Betterment previews your tax impact before you sell an asset so you can make tax-informed decisions. Plus, open any Betterment individual investing account (including an IRA) and make a deposit to earn up to $1,500. Why investing at Betterment is better: Ready to put automated investing to work for you? Get started today.*  | | | | | How's this for an icebreaker? In a trade war running so hot it's thawing shipping lanes across the Arctic, China is preparing to deploy a world-class, nuclear-powered icebreaking vessel in a move that could reshape the balance of power in the frozen tundra, according to a recent Financial Times feature. If you've found yourself still in search of an answer for why the US has grown so interested in Greenland, this may well be it. Melting Point Designed by the state-run 708 Research Institute and unveiled as a conceptual design in December, China's arctic icebreaker is supposedly capable of cracking through ice floes 2.5 meters thick. Its purpose? As outlined in China's 2018 plans to develop a "Polar Silk Road," the ship will be used to capitalize on melting ice caps to secure new shipping lanes through the arctic (China has claimed the icebreaker will serve as a "multirole" cargo and polar tourism ship, though expert analysts also told the FT it will no doubt serve another role for China's military ambitions). But even just developing new shipping lanes would be a big deal for the Middle Kingdom, which currently charts courses through NATO-controlled waters to deliver exports to Europe. Soon, the country might cut a course over the top of the globe — but whether or not it's a shortcut or just a frosty scenic route seems a little up for debate: - By using the Arctic route rather than the traditional course through the Suez Canal, voyages could be reduced by as much as 40%, one 708 Research Institute analyst recently told the state-run publication China Daily.
- That could work for exporters in the country's northern region, but Inge Bekkevold, a senior fellow at the Norwegian Institute for Defence Studies, told the FT that any exporters out of the country's southern manufacturing heartland will still likely find it cheaper to sail through the Red Sea into the Mediterranean Sea before arriving at ports in Greece.
Ship Shot: Either way, the icebreaker is yet another flex of China's shipmaking prowess, which amounts to around 232 times the shipmaking capacity of the US, the US Navy said last year. That shipmaking prowess became a little more singular in 2025, literally, when a $16 billion merger reunified China's two top shipmaking companies: the not-so-cleverly named China State Shipbuilding Company and China Shipbuilding Industry, which were previously split by state forces in 1999 in the name of competition. Now, the unified company is building the icebreaker. Written by Brian Boyle | | | | | | | | | Photo via Pernas Research | | | | | | Detroit's big three automakers took a combined $50 billion hit in write-downs as they scale back their electric-vehicle businesses. To put that in perspective, that's around the size of the US government bailout during the Great Recession. According to Kelly Blue Book figures, US electric vehicle sales fell 36% to 234,171 units in the fourth quarter of 2025. That's a drop so steep that it calls for a Jeep Wrangler, if only the owner of the Jeep brand, Stellantis, weren't the one smarting from the fall. Last week, ratings agencies Standard & Poor's and Moody's downgraded the company's credit rating to their lowest investment grade or, in less polite terms, just one notch above "junk." Driveshaft Downgrade This followed Stellantis' disclosure earlier this month that it took $26 billion in write-downs in the second half of 2025 after executives vastly overestimated the prospects for EV adoption. Stellantis CEO Antonio Filosa acknowledged the company had drifted from "car buyers' real-world needs, means and desires." In January, crosstown rival GM disclosed its own $7.6 billion in writedowns, warning more could be in store for this year, while a month earlier Ford said it would take $19.5 billion writedowns in 2025 and 2026. Ford CEO Jim Farley said his company was slamming the brakes now, "instead of plowing billions into the future knowing these large EVs will never make money." Gone are Stellantis' Ram 1500 REV electric pickup and Ford's F-150 Lightning, as well as billions in other investments in models, factories and upgrades. Now comes the part where executives try to get their tires out of the mud: - Reuters reported Friday that Stellantis is bringing back diesel versions of at least seven models in Europe as part of a retreat from EVs on the Old Continent, where sales have also trailed automakers' ambitious previous forecasts. The EU dropped plans to ban combustion engines by 2035 — a European battery venture backed by Stellantis shelved plans to build two gigafactories earlier this month — while the US is continuing to roll back initiatives, such as the Trump administration's decision to end vehicle emission standards last week.
- Stellantis' recent earnings were much weaker than analysts expected, as were its forecasts for revenue and operating income, which saw it pay heavy price for its EV missteps than its Detroit rivals. Its shares are down 29.8% this year, compared to a flat performance for GM shares and a 7.6% gain for Ford.
Engine Fire Down Below: "The bar has now been reset lower, and some sequential improvement in earnings and free cash flow is likely in 2026 and 2027," wrote Wolfe Research of Stellantis, essentially saying that the worst may already be priced in. In fact, the company's price-to-sales ratio of 0.12 compares favorably to Ford's 0.3 and GM's 0.43. Only three years ago, it turned a $25 billion profit. Written by Sean Craig | | | | | - Good Friday the 13th: US inflation eased to an eight month low of 2.4% in January, with gas and apartment rental prices alleviating much of the pressure according to Labor Department data released Friday.
- Under the Microscope: The Federal Trade Commission has stepped up scrutiny of Microsoft's bundling of its services and products, including by sending investigative requests to at least a half dozen competitors.
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* Partner | | | | Disclaimers *Investing involves risk. Performance not guaranteed. Terms Apply: betterment.com/tiered-terms. Betterment does not provide tax advice. TLH is not suitable for all investors. Learn more. **Gross returns do not reflect the deduction of advisory fees and expenses; actual results would be lower. | | |
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