“They have very good rare earth”
Ukraine has finally struck a deal to share revenue from mineral sources with the United States, following weeks of sometimes tense negotiations punctuated by insults and threats by President Trump.
What Trump proclaimed as a “very big deal” is indeed noteworthy — both in terms of how his administration is looking to profit from supporting Ukraine and how he is increasingly focusing on strategic nonpetroleum resources as a geopolitical goal.
What we know so far: Ukraine would contribute 50 percent of proceeds from the “future monetization” of mineral sales to a fund in which the United States would own a big — but as yet undetermined — stake. The joint venture would reinvest at least some of its revenue to rebuilding Ukraine.
It doesn’t contain any security guarantees from Washington, something that President Volodymyr Zelensky of Ukraine had sought. But it also doesn’t contain earlier Trump demands including that Kyiv contribute $500 billion or repay double any future aid from the United States.
Trump has been fixated on snapping up minerals. He doesn’t just want Ukraine’s resources, which include lithium, titanium and uranium. He’s also interested in getting access to Russia’s geographical wealth, including so-called rare earth elements like neodymium and promethium. (He appears to mistakenly believe that Ukraine has big stores of rare earth minerals as well.)
“I’d like to buy minerals on Russian land too if we can,” Trump said on Tuesday. “They have very good rare earth.”
But is Trump overestimating the importance of these minerals? Rare earth metals have been touted as critical to producing components like magnets and batteries for high-tech applications. And geopolitical hawks worry that China is by far the world’s biggest supplier of materials like yttrium.
But Bloomberg Opinion’s Javier Blas argues that they aren’t as essential as is commonly perceived (a myth that he says was spread in part by Ukraine last year):
At best, the value of all the world’s rare-earth production rounds to $15 billion a year — emphasis on “a year.” That’s equal to the value of just two days of global oil output. Even if Ukraine had gigantic deposits, they wouldn’t be that valuable in geo-economic terms.
Say that Ukraine was able, as if by magic, to produce 20% of the world’s rare earths. That would equal to about $3 billion annually. To reach the $500 billion mooted by Trump, the US would need to secure 150-plus years of Ukrainian output.
-
In other mineral news: Trump ordered the Commerce Department to study potential tariffs on copper, which could reshape global supply chains.
HERE’S WHAT’S HAPPENING
The House passes a budget focused on tax and spending cuts. Lawmakers in the lower chamber narrowly approved a bill that calls for $4.5 trillion in tax cuts and $2 trillion in spending reductions. The fine print: If legislators fail to meet the cost-cuts goal, the amount of tax reductions will also shrink. It sets up a path for Republicans to pass a budget along party lines, though Senate G.O.P. lawmakers have different ideas for tackling the issue.
President Trump again reaffirms his support for Elon Musk. On Truth Social on Wednesday, the president urged his billionaire ally to “run Elon, run!” despite facing blowback over an emailed directive to federal workers. The tech mogul is set to join Trump’s first Cabinet meeting on Wednesday. In related news: Several employees of the so-called Department of Government Efficiency resigned, saying they disagreed with its mission, and the White House finally identified DOGE’s acting administrator.
BP says it will refocus on oil and gas production. The embattled fossil-fuel giant said it would scale back its investments in clean energy projects as part of a strategy reset, following years of a slumping stock price and the recent demands by the activist investor Elliott Investment Management. But shares in BP fell after the company said it was slashing its stock repurchases.
Can Nvidia reboot a tech rally?
The shine has come off tech stocks this year, with the Magnificent Seven slumping into correction territory as investors worry that A.I.’s heady growth is nearing an end.
That puts the spotlight Wednesday on Nvidia, the $3.1 trillion tech giant whose chips power the artificial intelligence boom and which reports fourth-quarter results after the market close.
Wall Street’s expectations are still sky-high. That’s despite anxieties over DeepSeek, which has scrambled A.I. economics, and raised questions about Nvidia’s growth trajectory.
Jensen Huang, Nvidia’s C.E.O., could face tough questions about DeepSeek. Nvidia’s shares have fallen 8 percent since DeepSeek’s low-cost generative A.I. model was introduced last month. Tech bulls have since poured money into China, driving a big rally in shares of Alibaba and Tencent because of their A.I. bets.
That said, Chinese companies have been ramping up orders for Nvidia’s H20 chips — semiconductors specially modified for the China market to accommodate Washington’s export controls on more-advanced processors — to build their A.I. models, Reuters reports.
Here’s what the bulls will be watching:
-
Analysts expect Nvidia to report quarterly sales of $38.5 billion. But future guidance will be key as the company’s days of triple-digit growth rates are expected to end.
-
What about demand from so-called hyperscalers spending billions on chips and data centers? Last month, Meta and Microsoft announced they would double down on their A.I. investments this year.
-
Colette Kress, Nvidia’s C.F.O., told analysts that orders for its newest Blackwell chips were “staggering,” but gave little additional detail.
What else?
A study in contrasts on D.E.I.
Even before President Trump began waging war on workplace diversity, equity and inclusion programs, conservative pushback against D.E.I. prompted corporate titans including Walmart and Ford to pull back.
But it’s especially notable that BlackRock, the giant money manager that just three years ago said it was compelled to “embed D.E.I. into everything we do,” has ditched references to such initiatives in its annual report this year.
The acronym doesn’t appear at all in this year’s letter. But the filing does mention the importance of “building a connected and inclusive culture” and that “delivering for the firm’s clients requires attracting the best people from across the world.”
BlackRock has been a target for conservatives for years. Several red-state attorneys general have threatened the Wall Street titan and other firms with legal action over their D.E.I. policies, which they call unlawful and discriminatory.
The firm has also been criticized for its support of policies promoting environmental, social and corporate governance focuses, with Larry Fink, BlackRock’s C.E.O., saying he no longer uses the term E.S.G.
But then there’s Apple. The iPhone maker’s board on Tuesday rejected a proposal from a conservative think tank to ditch its diversity commitments because of legal concerns. “Our north star of dignity and respect for everyone, and our work to that end, will never waver,” Tim Cook, the tech giant’s C.E.O. said, though he added it could be open to revisiting the issue if “the legal landscape evolves.”
Apple’s commitment to D.E.I. is especially noteworthy given its multibillion-dollar entreaties to the Trump administration.
“It’s a gold card. It’s somewhat like a green card, but at a higher level of sophistication.”
— President Trump, on a planned replacement for the EB-5 visa program that would give wealthy foreigners (potentially including Russian oligarchs) a $5 million pathway to American citizenship. Trump said those who buy it would “be spending a lot of money and paying a lot of taxes and employing a lot of people.”
Thorny questions around Paramount-Trump
Paramount’s decision to bring in a mediator to settle with President Trump could bring the company closer to resolving his lawsuit while it finalizes a merger with the Hollywood studio Skydance.
But the settlement talks also raise several questions, DealBook’s Lauren Hirsch and The Times’s Ben Mullin report. What recourse do Paramount shareholders have? Does a settlement raise potential risks to media deals under Trump? And what is a board’s fiduciary responsibility when it comes to settling a lawsuit that a company says is without merit?
A recap: Trump sued CBS News for $20 billion, asserting that its “60 Minutes” program deceptively edited an interview with Vice President Kamala Harris to cast her in a more favorable light. Separate, but potentially related: Shari Redstone, who controls Paramount and CBS, is still waiting for regulatory approval for the Paramount-Skydance deal, which is supposed to close in the next few months.
Some Paramount executives believe that settling the suit would clear the way for the merger.
But the company said any potential settlement was “completely separate from, and unrelated to, the Skydance transaction and the F.C.C. approval process.” A Paramount spokesman said in a statement: “We will abide by the legal process to defend our case.”
At CBS News, which is part of Paramount, the settlement talks have led to an uproar. Legal experts see Trump’s case as weak, and the idea of a potential payout to him has caused deep distress within the storied news network.
“They are definitely going to get sued if they settle,” Brian Quinn, a law professor at Boston College, told DealBook, referring to potential shareholder suits against the company. Quinn reiterated a concern shared by some Paramount executives: Any settlement could appear to be a bribe for the Federal Communications Commission to approve its deal with Skydance.
Importantly, board directors and company executives are typically not insured against such lawsuits.
But those suits aren’t easy to win. The law generally says courts shouldn’t be in the business of second-guessing business decisions, and legal settlements usually fall within that category, several experts told DealBook.
Barring any smoking guns, that gives the board some legal leeway, according to Zohar Goshen, a professor at Columbia Law School. “The board,” he said, “can consider not only the direct legal exposure — assessed by the probability of winning or losing — but also the indirect business risks posed by the Trump administration’s stance on the corporation’s activities.”
But there’s more at play than strictly fiduciary considerations. Any settlement could create a thorny precedent. Trump’s longstanding animus toward CNN, for example, could complicate any deal maneuvers by its parent company, Warner Bros. Discovery.
The media industry has been shrinking and undergoing consolidation as the tech giants continue to eat away at its profit. Trump’s stranglehold on the deals process might make it harder for dwindling media companies to merge and survive.
THE SPEED READ
Deals
Politics, policy and regulation
Best of the rest
-
Egg-onomics: Five companies control half the egg market in the United States, a factor — along with bird flu — that may explain why prices have soared. (NYT)
-
Apple was working on a fix for a bug that momentarily transcribes the word “racist” as “Trump.” (Deadline)
