5.17.2023

 

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Good morning. It's Wednesday, May 17, and we're covering potential progress in federal debt limit negotiations, a $1B settlement over a banking scandal, and much more. First time reading? Sign up here.

 

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Need To Know
 

Debt Ceiling Discussions

President Joe Biden and the "Big Four" congressional leaders resumed talks yesterday on raising the government's $31.4T debt ceiling to avert a possible first-ever default next month.

 

House Speaker Kevin McCarthy (R, CA-20) said yesterday it's possible for a deal to be reached by the weekend for approval in Congress by June 1—a potential deadline forecast by Treasury Secretary Janet Yellen. The "Big Four" also includes Senate Majority Leader Chuck Schumer (D-NY) and Minority Leader Mitch McConnell (R-KY), and House Minority Leader Hakeem Jeffries (D, NY-8). Sticking points in discussions include addressing work requirements for benefits programs and reducing federal spending. 

 

The debt ceiling—the limit on how much the US can borrow to cover its financial obligations (see overview)—must be raised via legislation. Last month, the House passed a package on a party-line vote to raise the ceiling by $1.5T, which included $4.5T in spending cuts. Biden, who is cutting short an overseas trip to focus on debt limit talks, has said he would veto the package. 

 

Wells Fargo Settlement

Wells Fargo & Co. has agreed to pay $1B to settle a shareholders' lawsuit from its 2016 unauthorized customer accounts scandal. If approved, the payout will be one of the top 20 largest class-action settlements in history.

 

The lawsuit accused the bank's executives of publicly exaggerating the progress made in fixing its governance issues and risk-management systems while downplaying a $54B market value decrease between 2020 and 2022. A report from the House Financial Services Committee in March 2020 found the company failed to comply with consent orders, which the shareholders claim resulted in a 34% drop in the bank's stock in a little over a week. See the history of the bank's scandals here.

 

Wells Fargo has already paid billions of dollars in fines and settlements, including $300M in February for improperly charging customers for auto insurance, $3.7B in December to resolve US investigations into consumer abuses, and a guilty plea from a former executive who oversaw the fake account scheme.

 

Jewelry Heist Convictions

Five men were convicted yesterday for their role in the 2019 theft of 21 pieces of diamond-encrusted jewelry from an 18th-century collection in Dresden, Germany—an audacious break-in that revealed the museum's vulnerabilities. The burglars were sentenced to between four and six years in prison after much of the loot was returned

 

The group broke into Dresden's Green Vault Museum, the site of Europe's largest treasure collection (see photos). The haul included the 49-carat Dresden White Diamond, a sword with over 700 diamonds, and more (see list). The operation was considered low-tech—the burglars disarmed the security system by setting fire to a circuit breaker and later entered through a window whose bars they had cut and taped back together ahead of time (see more details).

 

The suspects are part of the same family responsible for the theft of a 220-pound Canadian gold coin from Berlin’s Bode Museum in 2017. See a list of the greatest art heists of all time here.

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In The Know
 

Sports, Entertainment, & Culture

> Cannes Film Festival kicks off from France with actor Michael Douglas receiving an honorary Palme d’Or (More) | Tony Awards (June 11, CBS) to be televised as originally planned but will be unscripted as writers strike continues (More)

> Inter Milan tops AC Milan to advance to UEFA Champions League final for first time in 13 years (More) | Soccer phenom Folarin Balogun, 21, opts to play for the US Men's National Team over England or Nigeria (More)

> San Antonio Spurs win top pick at NBA Draft lottery, likely to draft 7'4" French teenager Victor Wembanyama (More) | See the latest mock draft (More)

 

Science & Technology

> Butterflies originated in central and western North America roughly 100 million years ago with bean plants as their primary food source, new study finds (More)

> Archaeologists uncover two new well-preserved skeletons at Pompeii, believed to have died during the first-century eruption of Mount Vesuvius (More)

> Researchers discover new mechanism allowing DNA to repair itself; process fixes errors arising from when an RNA building block is substituted for a DNA building block (More) | DNA versus RNA explained (More)

 

Business & Markets

In partnership with Percent

> US stock markets close lower (S&P 500 -0.6%, Dow -1.0%, Nasdaq -0.2%) on debt ceiling concerns (More)

> OpenAI CEO Sam Altman testifies before Senate Judiciary subcommittee on privacy and technology, calls for AI safety standards (More)

> Home Depot shares fall 2% after home improvement giant warns sales will likely fall this year for first time since 2009 (More)

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Politics & World Affairs

> Ukrainian air defenses shoot down all 18 missiles launched during a Russian strike against Kyiv; attack early yesterday included six of Russia's Kinzhal hypersonic missiles (More) | See updates on the war here (More)

> New Mexico officials say Monday shooting in the town of Farmington that left three dead and six injured appeared to be random; suspect reportedly roamed a neighborhood firing shots before being killed by police (More)

> State Attorney General Daniel Cameron (R) wins Kentucky's Republican gubernatorial primary, will face Gov. Andy Beshear (D) in November elections (More) | IRS agent alleges whistleblower violations, says he was removed from Hunter Biden tax fraud probe after raising conflict of interest concerns (More) | North Carolina lawmakers override veto, reapprove 12-week abortion ban (More)

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Etcetera
 

Rare rainbow sea slug found in the UK

 

A rising number of Americans are switching religions.

 

Boy saves younger sister by hitting kidnapper with a slingshot.

 

Researchers unearth 400-year-old skeleton of a teen boy.

 

Mint condition 1958 Rolex Milgauss sells for record $2.5M

 

Watch a goalkeeper epically score from his area in a soccer match.

 

Man tries to switch places with dog to avoid DUI arrest.

 

... and introducing beer yoga (w/video).

 

Clickbait: A fake pregnancy, a traffic stop, and 1,500 grams of cocaine.

 

Historybook: Aristides is first winner of the Kentucky Derby (1875); Brown v. Board of Education decision outlaws racial segregation in public schools (1954); Boxer Sugar Ray Leonard born (1956); First legal same-sex marriages performed in the US (2004); Singer Donna Summer dies (2012).

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