Plus: Oh no Xi didn't!
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Today’s briefing: |
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Good morning Intriguer. One of the hottest trends that’s emerged among professional services firms these last few years is the emergence of geopolitics as an in-house function.
Instead of just outsourcing to external consultants, businesses are increasingly building up their own capabilities to prepare for geopolitical instability, whether that be in supply chains and trade agreements, or just for a vibe-check for transacting with certain nations.
External consultants are also cashing in on this market demand, with many C-suite firms now also building up their geopolitical practice areas. For all the diplomats out there who might be thinking of career transitions, take note!
$111,000
That’s the new record price Bitcoin just hit, as it continues its wild fluctuations from $88,000 just a month ago.
Wall Street eyes the business of geopolitics
When Wall Street woke up to check its Bloomberg terminals yesterday, they’ll have seen a headline that JP Morgan Chase now has its own ‘Center for Geopolitics’.
That’s America’s biggest bank launching something that sounds like a tweed-clad think-tank, led by Derek Chollet — a former Pentagon, State, and White House official.
And for anyone who’s been following the bank’s billionaire leader for a while (Jamie Dimon), this isn’t a surprise — he’s long weighed into this stuff, and periodically hosts world leaders at his Manhattan boardroom where his insights get rather spicy.
Anyway, in launching the new unit, Dimon has declared that geopolitical risk is now “our greatest risk.” Not rates, not runs, not bubbles. Geopolitics.
He’s not alone, either. In the past year or so…
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Goldman Sachs has launched an advisory, billed as not “another think tank”
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Lazard’s CEO has described geopolitics as central to his business
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Citi has hired Bob Lighthizer (Trump 1.0’s trade guy) to advise on Trump 2.0
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BCG has launched its own Center for Geopolitics, and
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Kearney has launched its own Geopolitical Dynamics.
(Fun fact: we’re delighted to have Intriguers across all firms 👋)
Anyway… should businesses actually care about geopolitics?
The obvious and widely accepted answer is… yes. Still, there’s a gap between a) keeping up with the headlines, and b) having actionable insights. That’s why we founded Intrigue.
But here are some quick examples:
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Stocks. When Pakistan fought India, China’s military stocks soared. Why? China supplies Pakistan with kit, and it’s better than (say) Russia’s struggling gear. All good stuff to know before the stock soars, though even better to know the underlying trend we’ve long tracked: as we go multipolar, our world is re-arming.
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Supply chains. Covid and the Houthis were just warning shots. As rattled capitals peer outside, they’ll now see every chokepoint as a vulnerability to seize, if not an opportunity to exploit. So sure, push through that pandemic then bomb the ship-targeting Houthis, but supply chains will keep getting harder, not easier.
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Regulations. Those same spooked capitals are trying to re-assert guardrails back home, and that can cost or earn you billions. Just ask Nvidia’s Jensen Huang, who copped a $15B Trump ban on China chip sales one week, then scored Trump’s billion-dollar reprieve from Biden’s AI diffusion rules the next. Speaking of which…
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Access. That’s why the world’s top CEOs will clear their schedules to join Trump’s tours, attend Riyadh’s summits, or assemble for Xi’s audiences. Access can be existential. But it flows both ways, whether it’s Trump telling Walmart to eat his tariffs, or Xi strong-arming Hutchison not to sell its Panama Canal assets to the US.
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Macro. And behind it all, there’s central banks, bonds, rates, and currencies: as China devalues its yuan to offset US tariffs, its non-US exports surge while any yuan-denominated investments take a haircut. Or as Iran wobbles, crude oil spikes and bond yields jump as investors bet on inflation, all shaping currencies and state finances.
Now, none of that means CEOs want another deck of consulting slides. Rather, they want wise geopolitical counsel when making immediate decisions, a little like what world leaders get (or should get) from their foreign office.
Intrigue’s Take
Seeing all these vast corporations announcing their geopolitical units one after the other occasionally leaves us with a teeeeensy dash of career regret: maybe we could’ve had that Range Rover in the garage and that Samsung Frame up on the wall by selling our same takes for millions instead of giving them away for free? But no Frame or Rover can compensate for the fun we’re having, nor the community you’re helping us build.
Interestingly, our ex-diplomat friends in that corporate world tell us it’s getting wild: while banks first hired them to help internal executives make better decisions, they’re now getting wheeled out for board appearances every time a client so much as sneezes towards a map. So there’s a real thirst for insight right now.
And that means, dear Intriguers, this is your moment to dust off that unloved international relations degree and shine (and buy our ads).
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Meanwhile, elsewhere…
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🇿🇦 SOUTH AFRICA – Ramaphosa and Trump face off at the White House. |
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🇮🇱 ISRAEL – Two Israeli embassy staff shot dead in DC. |
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🇺🇸 UNITED STATES – Stocks slip on budget bill worries. |
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🇺🇦 UKRAINE – Former presidential aide shot dead in Spain. Comment: The string of suspicious deaths of Kremlin critics abroad has given way to more assassinations of pro-Kremlin voices lately. We wonder whether, as the US steps back its support for Ukraine, that’s also removing any US leverage over Ukraine’s intelligence services, who now seem unleashed after years of Biden’s caution. |
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🇲🇾 MALAYSIA – Minister announces then walks back Huawei AI system. Comment: This looks to us like an example of the tightrope countries in Southeast Asia have to walk between wanting to tout progress to a domestic audience, while avoiding antagonising the US or China, particularly when it comes to emerging technologies. We touched on this complex balance earlier this week. White House advisors have cited this Malaysia story as vindication for Trump’s decision to ditch Biden’s AI diffusion rules, arguing they just opened gaps for US rivals. |
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🇨🇩 DR Congo – Former PM sentenced to hard labour. |
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🇻🇪 Venezuela – Maduro suspends flights from Colombia ahead of election. Comment: Call us crazy, but wouldn’t a crack team of mercenaries just add an extra leg to their itinerary and enter Venezuela via a third country? 🤔 |
Extra Intrigue
In other worlds…
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Film: Nigeria is showcasing its first film at Cannes (My Father's Shadow), a drama following a family reunion during Nigeria’s 1993 election.
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Tech: A new AI weather tool is cranking out quicker, more accurate weather predictions.
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Sports: Boxing star and erstwhile Philippine politician Manny Pacquiao has announced his return to the ring, four years after his last fight.
Intrigue presents
Take out your phones, because we’ve got a couple of dates for your calendar.
We’ll be chatting with CNN journalist, author, and global affairs commentator Fareed Zakaria on how we ended up in today’s Age of Revolutions, on 28 May. Sign up here!
And join us for a candid chat with Pulitzer Prize-winning author and historian Anne Applebaum on how modern autocrats work together, and the global fight for democracies to push back, on 2 June. Sign up here!
Faux pas of the day
Credits: EPA-EFE/Xinhua.
State dinners with Beijing’s party chair are more tightly choreographed than Bring It On (2000), Bring It On: Again (2004), Bring It On: All or Nothing (2006), Bring It On: In It to Win It (2007), and Bring It On: Fight to the Finish (2009), combined.
So it was interesting to hear reports that Brazil’s first lady Rosangela da Silva (aka ‘Janja’, above left) used a recent presidential state dinner in Beijing this month to make some impromptu remarks criticising TikTok’s impact on women and children in Brazil — President Lula has denied media claims that China’s first lady and a minister were upset.
Today’s poll
Do you think geopolitics is the single biggest risk to banks today? |
Yesterday’s poll: What do you think Xi's latest austerity guidelines are mostly about?
🔨 Party discipline (52%)
📈 Budget austerity (17%)
💸 Anti-corruption (5%)
⚡ Popular legitimacy (23%)
✍️ Other (write in!) (3%)
Your two cents:
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🔨 E.K.H: “Sounds like a convenient excuse to throw any up-and-coming potential rivals (or successors) under the bus.”
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📈 E.K.M: “Now he’s not SAYING tariffs, but…”
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⚡ R.O: “The tariff war will hurt the Chinese populace, and so Xi is ensuring the party doesn't look like greedy fat cats whilst the masses suffer.”
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✍️ L.B: “All of the above, though discipline can take care of the others.”