Good morning! China’s DeepSeek was the talk of the town this weekend, outperforming OpenAI’s ChatGPT despite relying on less advanced chips. Nasdaq futures were down 3% on the news, with Nvidia dropping nearly 9%.

Colombia reversed its stance on rejecting deportation flights after Trump imposed 25% tariffs and other sanctions. Meanwhile, the White House is pushing for an Oracle-led TikTok deal as Perplexity AI revised its own bid for the platform.

Wall Street CEOs are gearing up for crypto moves after the SEC reversed a key accounting rule that had made holding crypto costly and impractical for banks.

Plus: Starbucks’ CEO earned $96M in just four months, Zuckerberg plans to spend $60B on AI growth in 2025, and record-high egg prices may be coming next year.

Balance your gut, sharpen your mind—Pendulum’s Metabolic Daily is here to help.

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Worst Buyout of All Time

Wall Street banks have been stuck holding the bag on Elon Musk’s $44 billion buyout of Twitter—now rebranded as X—since 2022. After years of delays and mounting losses, banks are finally making moves to offload the debt tied to one of the most infamous deals in recent financial history.

Morgan Stanley, Bank of America, and Barclays are leading the effort to sell up to $3 billion of the $13 billion in loans used to finance the acquisition. The banks hope to sell senior debt at 90–95 cents on the dollar, while retaining the more junior tranches, signaling an effort to minimize their losses.

This isn’t their first attempt at unwinding the deal: earlier, $1 billion of debt was sold privately. However, the banks remain burdened with the majority of the financing, which has been weighing on their books. Typically, buyout debt is flipped to outside investors within months, but X’s steep decline in revenue, stagnant user growth, and volatile reputation have made it nearly impossible to find buyers, until now.

Musk’s polarizing leadership and chaotic rebranding led some to label this acquisition the “worst buyout since the 2008 financial crisis.” Equity investors in X have reportedly written down their stakes by as much as 75%.

Despite these challenges, there’s renewed interest in X’s debt. Recent optimism stems from Musk’s alignment with President Trump and an improvement in X’s financial outlook. Some brands that fled the platform post-acquisition are returning, and Musk’s internal communications claim X is slowly regaining its footing.

But even Musk himself has admitted that “user growth is stagnant, revenue unimpressive, and we’re barely breaking even,” casting doubt on the platform’s ability to deliver sustainable profitability.

Takeaway: Wall Street’s patience is running out, and the X debt sale is as much about damage control as it is about strategy. For Musk, the pressure is on to prove that X isn’t just a “free-speech platform” but a viable business model. For banks, this is their shot at cutting losses and offloading a deal that’s haunted their books since 2022. For the Morgan Stanley-led group, is this move high risk, high reward, or just a higher headache? Only time will tell.

_{PRESENTED BY PENDULUM}

Stomach Turning During That $2B Merger?

The markets are volatile, your inbox is on fire, and your stomach is… not cooperating. Stress, long hours, and poor diet can wreak havoc on your gut, and believe it or not, that could be dragging down your performance.

Enter Pendulum’s Metabolic Daily—a next-gen probiotic designed to improve your gut health and, in turn, your productivity. Packed with the groundbreaking Akkermansia muciniphila strain, it helps:

• Optimize metabolism to keep you alert and focused

• Improve digestion for better energy

• Boost immune health to keep you in the game

Think of it as rebalancing your portfolio—but for your gut. One capsule a day, no spreadsheets required.

Exclusive Offer: Short Squeez readers get 20% off their first order. Just click the link—no code needed.

_HEADLINES

Top Reads

• Stock futures fall as China’s DeepSeek rattles AI space (CNBC)

• Colombia backs down on deportation flights after Trump tariffs threat (BBC)

• White House in talks to have Oracle, investor group buy TikTok (YF)

• Perplexity submits a new bid for TikTok (TC)

• Musk's latest move meant to connect millions like never before (Fox)

• Trump unleashes surprise global rally by backing off key promise (YF)

• SEC paves way for Wall Street banks to hold crypto (Axios)

• Trump leans into pledge to cut taxes on tips at a Las Vegas rally (YF)

• Novo Nordisk shares pop on early-stage weight loss drug trial results (CNBC)

• Pardoned Silk Road founder calls president 'a man of his word' (Fox)

• Starbucks’ CEO awarded $96 million for 4 months of work (WSJ)

• Zuckerberg expects to spend $60B on AI growth in 2025 (CNBC)

• Where you can find AI data center jobs in the U.S. (Axios)

• What Trump’s public scolding of BofA CEO was really about (CNN)

• Expect record-high egg prices for most of the year (CNN)

• Trump crypto plans have Wall Street CEOs ready to jump into digital assets (CNBC)

_{CAPITAL PULSE}

Markets Rundown

Nasdaq Leads Stocks Lower

U.S. equity markets declined on Friday but still posted gains for the second consecutive week. Sector performance was mixed, with communication and utilities stocks leading the gains.

The 10-year Treasury yield edged lower to 4.62%, while global markets saw a positive day.

In Asia, the Bank of Japan raised its policy rate by 0.25%, as expected. The U.S. dollar weakened against major currencies.

In commodities, WTI oil was little changed but declined for the week following President Donald Trump’s announcement to expand U.S. oil production and push for lower crude prices from OPEC.

Corporate Earnings Season Off to a Solid Start

Fourth-quarter earnings season continues to deliver positive results, with 76% of reporting S&P 500 companies beating analyst estimates, achieving an average 7.4% upside surprise.

Earnings growth is forecast at 12.7% year-over-year and is broad-based, with seven of 11 sectors expected to report growth.

The four sectors anticipating declines—consumer staples, energy, industrials, and materials—make up 19% of the S&P 500’s market capitalization.

Broadening earnings growth has led to a rotation in market leadership, with consumer discretionary, financials, industrials, and utilities outperforming the technology sector over the past six months.

Services Activity Misses Estimates; Manufacturing Returns to Growth

Preliminary data from the S&P Services PMI declined to 52.8 in January, missing expectations of 56.7.

Meanwhile, the Manufacturing PMI increased to 50.1, surpassing forecasts of 49.5 and marking its first return to growth in six months. PMI readings above 50.0 indicate expansion.

The composite PMI, which combines services and manufacturing, reflects continued business-activity growth, albeit at a slower pace.

Looking ahead, additional Fed interest rate cuts and pro-growth policies, including tax cuts and deregulation, should support further economic expansion.

Movers & Shakers

• (+) Twilio ($TWLO) +20% after the cloud communications software company issued an optimistic forecast.

• (+) Novo Nordisk ($NVO) +8% because its new weekly weight-loss drug passed early-stage trials.

• (–) Texas Instruments ($TXN) -8% after the semiconductor maker issued disappointing guidance.

Private Dealmaking

• Retro Biosciences, a human lifespan startup, raised $1 billion

• ShopMy, a digital shop maker, raised $77.5 million

• Prophecy, a data copilot, raised $47 million

• Method, a debt repayment startup, raised $41.5 million

• Solera Health, a healthcare navigation software provider, raised $40 million

• BeZero Carbon, a carbon credit ratings startup, raised $32 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{BOOK OF THE DAY}

The Hamilton Scheme

“Forgotten founder” no more, Alexander Hamilton has become a global celebrity. Millions know his name. Millions imagine knowing the man. But what did he really want for the country? What risks did he run in pursuing those vaulting ambitions? Who tried to stop him? How did they fight?

It’s ironic that the Hamilton revival has obscured the man’s most dramatic battles and hardest-won achievements―as well as downplaying unsettling aspects of his legacy.

Thrilling to the romance of becoming the one-man inventor of a modern nation, our first Treasury secretary fostered growth by engineering an ingenious dynamo―banking, public debt, manufacturing―for concentrating national wealth in the hands of a government-connected elite.

Seeking American prosperity, he built American oligarchy. Hence his animus and mutual sense of betrayal with Jefferson and Madison―and his career-long fight to suppress a rowdy egalitarian movement little remembered today: the eighteenth-century white working class.

Marshaling an idiosyncratic cast of insiders and outsiders, vividly dramatizing backroom intrigues and literal street fights―and sharply dissenting from recent biographies―William Hogeland’s The Hamilton Scheme brings to life Hamilton’s vision and the hard-knock struggles over democracy, wealth, and the meaning of America that drove the nation’s creation and hold enduring significance today.

"Excellent if you want to know the real history of the United States.”

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Skiing = Subscription

_{PRESENTED BY ELF LABS}

These AI-Powered Toys Don’t Just Play — They Pay

Imagine toys that talk back and build a bond with you. Elf Labs is creating a new era of AI-powered interactive toys — dolls, 3D avatars, and AR characters that can communicate, learn, and evolve alongside their fans. From Cinderella to Peter Pan, these beloved icons are being brought to life in ways we’ve never seen before.

But this is just the beginning. Elf Labs is targeting $350B in licensed merchandise, $200B in gaming, and $1.15T in media sales — a total transformation of the $2T entertainment industry. Backed by 100+ trademarks, 12 patents, and 6 major franchises (2 already funded), they’re expanding into 30 global markets to turn nostalgia into profit.

Early investors snag 10% bonus shares, but time’s running out. Invest before January 29 to earn 10% bonus shares in this groundbreaking opportunity.

_{DAILY ACUMEN}

Money Worlds

Your relationship with money is as much psychological as it is financial.

The concept of "Money Worlds," developed by Dr. Miriam Tatzel, reveals how our attitudes toward spending and materialism shape not only our financial health but also our relationships.

There are four distinct "money worlds."

A Value Seeker is tight with money but high in materialism, spending time researching deals to invest in quality.

A Non-Spender is also tight with money but low in materialism, finding joy in simplicity and avoiding spending altogether.

In contrast, a Big-Spender is loose with money and high in materialism, finding joy in acquiring beautiful and high-quality things, though this can sometimes lead to financial risks.

Lastly, an Experiencer is loose with money but low in materialism, prioritizing personal growth and memorable experiences over material possessions.

Understanding your money world—and the money worlds of those around you—can help reduce judgment and conflict.

Each money personality has its strengths and weaknesses, and embracing them leads to healthier finances and better relationships.

Which money world resonates with you?

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Short Squeez Picks

• Office rudeness affects women most

• How to work for a hands-off manager when you’re fully remote

• When to let go of old goals

• Why the best bosses can be mistaken for micromanagers

• 23 products that will boost your productivity

• 5 benefits of breathwork

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Memes of the Day