America
US banks post record $49 billion profit on AI boom and geopolitical volatility
The five largest banks in the United States have reported record profits, driven by an artificial intelligence boom and market volatility triggered by conflict involving Iran.
JPMorgan, Bank of America, Goldman Sachs, Wells Fargo, and Citigroup generated a combined profit of $49 billion in the second quarter, according to data released last week.
SpaceX’s $85 billion initial public offering drew retail investors in waves, generating approximately $500 million for the underwriting banks involved in the transaction.
Market volatility surrounding the repeated opening and closing of the Strait of Hormuz, alongside ongoing debates over whether artificial intelligence represents a brighter future or an existential threat, also boosted bank revenues.
Revenues from significantly higher investment banking fees during a surge in mergers and acquisitions, alongside deals with artificial intelligence companies upgrading their infrastructure, further contributed to the gains.
However, JPMorgan Chase CEO Jamie Dimon tempered expectations during the bank’s earnings announcement.
While praising the “resilience” of the US economy and noting that business conditions were almost “as good as they can get”, Dimon also issued a warning.
“Several risks, including geopolitical tensions and wars, stubborn inflation, large global fiscal deficits, and high asset prices, are shifting beneath the surface like tectonic plates,” Dimon said.
“We cannot predict how these forces will ultimately play out,” Dimon added.
During Goldman Sachs’ earnings call, CEO David Solomon stated that the banking sector is “in the midst of an AI capital expenditure supercycle” driven by investments in artificial intelligence infrastructure.
Further artificial intelligence initial public offerings are also on the horizon. Anthropic’s upcoming listing will be led by Goldman Sachs and Morgan Stanley, while OpenAI has yet to decide which banks will lead its own process.
America
AIPAC cuts online donation links for Democrats after Israel aid vote
The political action committee of the American Israel Public Affairs Committee (AIPAC) has restricted online donations to several Democratic members of the US House of Representatives who voted this week to restrict military aid to Israel.
The move marks the latest division between the Democratic Party and the influential pro-Israel lobbying group.
As of Friday afternoon, donation buttons had been removed next to more than 10 Democratic lawmakers on the AIPAC political action committee’s online portal, which lists sitting members of Congress who “stand with Israel”.
Among those whose donation buttons were disabled on the portal are Representative Katherine Clark of Massachusetts, the second-ranking Democrat in the House; Representative Joe Neguse of Colorado, another member of the party leadership; and Representative Pat Ryan of New York, who announced after the vote that he would reject AIPAC funding.
“AIPAC members are deeply grateful to those representatives who take a principled stand and are disappointed by those who do not,” AIPAC spokesperson Deryn Sousa said in a statement to Politico.
The development is seen as further evidence of a major shift in political relations between AIPAC and House Democrats.
Ahead of the congressional midterm elections, several progressive left-wing candidates defeated primary opponents whom they had criticised for accepting financial support from AIPAC. This reinforced the view among some Democrats that associating with the pro-Israel lobby is politically damaging.
According to data from the Internet Archive, the donation buttons in question were last active on 6 July.
At that time, the portal also featured praise for the former House Speaker, Representative Nancy Pelosi of California. A note on the portal on 6 July, acknowledging that Pelosi would not seek re-election, read: “Thank you, Congresswoman Pelosi, for your support of the US-Israel relationship.”
As of Friday, this message of appreciation, along with a similar thank-you note dedicated to Pelosi’s California Democratic colleague, Representative Julia Brownley, had been removed from the website.
On Wednesday, more than 100 Democratic House members voted in favour of an amendment to the State Department budget bill aimed at cutting US military aid to Israel. This marked a significant fracture in what was once seen as the party’s unwavering support for the Jewish state.
Most of the lawmakers who supported the amendment cited their opposition to the way Israeli Prime Minister Benjamin Netanyahu is conducting the war in Gaza.
The amendment was rejected after 98 Democrats, including Minority Leader Representative Hakeem Jeffries of New York, voted against it.
Representative Pat Ryan, writing on social media platform X on Wednesday, said he expected groups like AIPAC to withhold support from his future election campaigns, adding: “To be honest, I don’t want their support anyway.”
In his post, Ryan also wrote: “Rigid approaches that refuse to stand up to the corrupt and increasingly dangerous Netanyahu regime have no place in our politics.”
America
Data center energy demand drives up PJM grid auction costs by $6.3 billion
The latest capacity auction conducted by PJM Interconnection, the largest electrical grid operator in the United States, has revealed that surging energy demand from data centers will add billions of dollars to electricity bills across 13 states in the coming years.
PJM released the results of its recent auction, which secures electricity capacity for a 13-state region for the period spanning June 2028 through May 2029.
Monitoring Analytics, the independent market monitor for PJM, determined that of the $16.4 billion in total capacity market costs resulting from the auction, approximately $6.3 billion is directly driven by the demand generated by data centers.
According to data from the market monitor, the demand from data centers has added a cumulative $29.4 billion to electricity costs across the last four PJM capacity auctions.
Joseph Bowring, the president of Monitoring Analytics, stated that the market watchdog’s position is that “data center load should be removed from the capacity market and procured through a special auction.”
“This method would allow data centers to access capacity through a market mechanism while ensuring they pay their own capacity costs, thereby preventing these costs from being shifted to other consumers,” Bowring said.
Consumer advocacy groups also expressed deep concern over the impact of data centers on electricity pricing following the release of the auction results.
“Right now, we are facing a wave of extreme and very rapidly growing demand driven by data centers, and the market was not prepared for this,” said Clara Summers, campaign manager for Consumers for a Better Grid.
Summers noted that while prices in this auction remained at levels similar to other recent auctions, consumers can expect their utility bills to remain comparably high for the foreseeable future.
Julia Kortrey, director of strategic initiatives for the state program at Evergreen Action, stated that the high prices have now become “largely locked in.”
“We are unlikely to see any relief until the 2030s from any moves PJM could make to improve the situation,” Kortrey said.
PJM operates the power grid serving 67 million people across the eastern and midwestern United States, covering Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia.
The grid operator announced that, as was the case in the previous auction for the 2027–2028 delivery year, it was unable to procure a sufficient amount of electricity capacity to meet its reliability targets.
To address this shortfall, PJM is requesting authorization from federal regulators to conduct a special “Backstop Procurement Auction.”
“These auction results demonstrate that electricity demand continues to grow faster than electricity supply,” David Mills, president and chief executive officer of PJM, said in a written statement.
“PJM is aware of the impact this supply and demand imbalance has on system reliability and consumer costs. We are working on multiple fronts with government and industry leaders to restore this balance by bringing new generation online as quickly as possible and managing the growth of new load on the grid,” Mills added.
While the statement did not reference data centers directly, PJM has recently reported that electricity demand from data centers represents the fastest-growing sector of load growth on its system.
America
Musk’s DOGE agency closes after failing to meet $2 trillion US budget savings target, analysis shows
The Department of Government Efficiency (DOGE), a highly controversial body established in the United States during the administration of Donald Trump, was officially shut down on July 8.
Randy Erwin, president of the National Federation of Federal Employees (NFFE), welcomed the termination of the department, stating that the structure left behind no savings and caused immense damage to public services.
Erwin noted that while Donald Trump and Elon Musk implemented massive cuts to public programs under the pretext of achieving budget savings, no savings were ultimately realized.
The NFFE president further stated that during this process, trillions of dollars in tax privileges were instead provided to the wealthiest segments of society.
Emphasizing that the failure to publish a final activity report following the closure of DOGE amounted to an admission of defeat, Erwin offered the following assessment:
“We welcome the end of DOGE, the most destructive government reform initiative of the past century. DOGE has left a deep scar on the federal workforce. It has now become far more difficult to recruit and retain personnel with the talent and experience necessary for agencies to carry out their duties. The American people will have to pay the price for these errors and imprudence for decades.”
New York Times analysis refutes claims
An analysis published by The New York Times in late 2025, which examined federal procurement and contracting records during the first nine months of Trump’s second term, refuted the budget claims made by DOGE.
The analysis revealed that the budget cuts claimed by Musk and Trump did not yield any savings, but may have instead generated additional costs for the public.
As a result of the cuts implemented by Musk and Trump’s Director of the Office of Management and Budget (OMB), Russell Vought, who both operated within the framework of DOGE, 317,000 federal employees were terminated.
It was reported that similar cutting and restructuring initiatives are continuing at the Department of Agriculture, while unions continue to resist the process.
In early 2025, Musk and Trump had promised to secure $2 trillion in savings by combating budget irregularities, waste, and abuse. However, by the end of the process, the officially claimed savings amount stood at just $215 billion—only one-tenth of the projected target.
Analysts determined that it remains unclear how much of this amount was actually cut from genuine waste categories, noting that the vast majority of the reductions stemmed from the salary budgets of terminated personnel who had been administering critical public services.
The New York Times team wrote that DOGE failed to reach its target of reducing federal spending by $1 trillion before October 2025, and that federal spending actually increased rather than decreased during this period.
According to the analysis, 28 of the 40 largest cuts claimed by DOGE, including the two highest-budget items, turned out to be completely false.
It was determined that these two contracts, which concerned aircraft maintenance and information technology, had a combined value of $7.9 billion and remained fully in effect.
These two items reportedly accounted for a larger budget than the total of the other 29,000 cuts claimed by DOGE.
Terminated employees establish tent city
Following the layoffs, affected federal employees established a tent city in front of Union Station in Washington.
Gathering under the umbrella of an organization called the Federal Unionists Network (FUN), the former public employees established a support center there for shelter, solidarity, and job search assistance.
A statement published on the organization’s website read: “We are here to unite the federal workforce, protect vital services, and defend the public we serve.”
GAO already combats waste
Randy Erwin pointed out that the Government Accountability Office (GAO), an official and bipartisan agency tasked with combating waste and abuse within the federal government, has already been active for many years.
Consequently, he emphasized that there was never any need for a parallel structure like DOGE.
According to one of the latest reports published by the GAO, a gap of $186 billion emerged in the federal budget due to “improper payments,” irregularities, and waste during the 2025 fiscal year, which ended on September 30.
More than 73% of this amount occurred across five key areas: Medicare, Medicaid, SNAP (food assistance), the earned income tax credit, and pandemic-era small business support programs.
The GAO report indicated that between $132 billion and $251 billion in additional savings could be achieved through measures ranging from streamlining the Navy’s shipbuilding processes to preventing duplicate payments in the social security system, though this would require congressional approval.
It was reported that during its operational period, DOGE dismissed or placed on paid leave thousands of federal employees, but because the services performed by this personnel were of critical importance, they later had to be rehired.
This situation was found to have resulted in a major waste of taxpayer funds rather than savings for the public budget.
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