If you see an investment banker on the street, they’ll likely be sporting a smile bigger than when they got to pick The Wolf of Wall Street for the Christmas Day movie. The biggest banks in the US have reported stellar earnings over the last few days, crushing analyst expectations and painting a bullish picture of the economy.

DEALS, DEALS, DEALS. Among the banks to report boffo quarterly results this week, Goldman Sachs said a surge in dealmaking has supercharged the industry, which is apparent in the gangbusters numbers major banks have delivered:

• Goldman said its third-quarter profits jumped 37% to $4.1 billion, putting its main investment arm on track to deliver its best year ever (though the bank also announced an upcoming round of layoffs).
• Citigroup’s profits were up 16% from a year ago, JPMorgan Chase reported a 12% jump, and Bank of America was up 23% YoY. Morgan Stanley shot past expectations with a 45% jump in profits from last year, with its quarterly trading revenue even higher than rival Goldman’s.

But…money is really only moving around at the top

The health of big banks is often seen as a signal for the whole economy, but there’s a catch to all this good news. While corporate dealmaking and investments ratcheted up this summer, spending at the bottom seemed to freeze, with consumer deposits growing, but consumer lending demand staying in a holding pattern. The trend mirrors Fed data released last month, which showed that the top 10% of US consumers made up nearly half of total consumer spending earlier this year.

Looking ahead…there’s a chance the good times won’t keep rolling for these banking giants. Concerns about the private credit market have been growing after the collapse of wildly indebted auto lender Tricolor and car part supplier First Brands. Plus, industry vets like JPMorgan CEO Jamie Dimon have warned that market valuations are nearing “bubble territory.” Journalist Andrew Ross Sorkin, who specializes in market crashes, said he’s nervous about unsustainable stock prices.—MM

SCOTUS seems poised to limit Voting Rights Act. The Supreme Court seemed open to curbing the use of the Civil Rights era law to allow states to consider race in drawing electoral maps during a second round of oral arguments yesterday in a case over the creation of Louisiana’s second majority-Black electoral district. The court’s conservative majority questioned whether using race as a factor in determining Congressional districts, which the law permits to remedy the suppression of Black voters, should have an end point in time. If the court finds that it should, the change could help Republicans win more seats in Congress. But despite current redistricting battles, it might not impact the midterm election cycle since a ruling is unlikely to come before this summer.

Judge temporarily blocks firing federal employees during shutdown. A federal judge in San Francisco issued a temporary restraining order barring the Trump administration from firing government employees as the government shutdown drags on. In a case brought by two labor unions, the judge said the firings are illegal, and the administration had used the shutdown “to assume that all bets are off, that the laws don’t apply to them anymore and that they can impose the structures that they like on the government situation that they don’t like.” The decision came soon after President Trump’s budget director, Russell Vought, said the administration planned to eliminate more than 10,000 roles.

BlackRock and tech giants to buy data center company for $40 billion. Stop us if you’ve heard this one before, but there was a major deal announced yesterday in the AI space. A consortium of investors that includes BlackRock’s Global Infrastructure Partners, Nvidia, Microsoft, and xAI, among others, is buying Aligned Data Centers. Aligned, currently owned by Macquarie Asset Management, designs and operates data centers in North and South America. The deal, expected to close next year, comes amid a race to build more data centers as AI models hoover up computing power.—AR

Starting yesterday, a more restrictive media policy from the Pentagon went into effect that was almost universally rejected by news organizations, which said it would cost reporters their First Amendment protections and criminalize them for doing their jobs.

Defense Secretary Pete Hegseth revoked access to the Pentagon building for journalists who refused to sign a pledge to not solicit and publish information from the Defense Department. Under the new rules, even if intelligence is unclassified, reporters could be deemed a “security risk.”

At least 30 news organizations refused to sign on, including major TV networks NBC, ABC, CBS, CNN, and Fox, as well as print outlets like the New York Times and Wall Street Journal. Only the right-wing One America News Network agreed to abide by the new policy, while even other conservative outlets like Newsmax balked. Impacted journalists turned in their press passes yesterday.

Murky legal ground: According to a lawyer who spoke to Reuters, any reporters who acknowledge the new policy and later disclose sensitive information could be more susceptible to prosecution. The Pentagon Press Association, which represents news organizations that cover the military, said the policy “threatens retaliation” against reporters.

Here to stay: President Trump backed the new approach on Tuesday, saying Hegseth, who Trump supported when he leaked military plans in a group chat, “finds the press to be very disruptive in terms of world peace and maybe security for our nation.”—DL

With a name like Smucker’s, its lawsuit has to be good. The company that’s synonymous with grape jelly sued Trader Joe’s this week for allegedly copying one of its most successful products, the Uncrustables sandwich.

Peanut butter and subterfuge. The Smucker’s lawsuit accuses Trader Joe’s of intentionally confusing customers and risking its brand value by knocking off the look and packaging of Uncrustables:

• Smucker’s has a trademark for “a round pie-like shape with distinct peripheral undulated crimping,” and for its boxes that show said sandwich with a bite taken out, the Washington Post reported.
• The company has invested a lot in Uncrustables, spending $1 billion to develop and market the signature snack over the past 20 years, according to the lawsuit.

Smucker’s wants Trader Joe’s—which hasn’t commented to news outlets about the suit—to destroy its frozen, crustless, PB&J bread pockets and hand over the money it made from them since launching this summer (plus damages).

Alleged dupes are typical for TJ’s (see: Oreos Joe-Joe’s, Cheerios Joe’s O’s, and Pringles Saddle Potato Crisps), but it may have traded too close to the Joe this time. Smucker’s noted that there are other Uncrustable competitors it hasn’t gone after—likely a reference to Walmart, Aldi, and Target, which depict clearly square-shaped dupes without a rounded bite on their boxes.—ML

If the Artful Dodger were schooling Oliver Twist today, he’d skip any chatter about wallets and hankies and tell him to go for the phone. London police have recently launched a crackdown after 80,000 phones were nicked in the British capital last year, the New York Times reports.

Those pilfered phones aren’t just being nabbed by small-time crooks—they’re often being handed over to international criminal networks that send many of them to China for resale. According to the NYT:

• Two weeks of raids last month on suspected middlemen yielded 2,000 stolen phones and ~$266,000 in cash.
• A pair of men arrested last month were accused of being ringleaders of a group that sent as many as 40,000 stolen phones to China. Police say their car had phones wrapped in aluminum foil to prevent the transmission of tracking signals—and that they were spotted buying nearly 1.5 miles’ worth of foil at Costco.

British authorities say that one reason phones are so frequently targeted is that, in this case, crime pays. Thieves can unload them in the UK for ~$400 each—more than three times the pay for a full day of work at minimum wage—and newer phone models can fetch as much as $5,000 in China.—AR