Good Afternoon. February ends the way it lived: jumpy, crowded, and one bad headline away from a mood swing. Bank stocks just took a punch on private-credit nerves, and Dimon’s “this feels like ’07” warning suddenly looks less like vibes and more like a weather report.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

1. Banks Get Smoked as February Ends in a Risk-Off Thud

The News: Stocks slid hard on Feb. 27, 2026, with bank shares taking the worst hit as private-credit anxiety spread: the KBW Bank Index fell 5.4% and big names dropped 6%–8%, including Goldman Sachs. At the same time, the “AI trade” stayed shaky—Nvidia fell again post-earnings—while investors piled into Treasuries after January PPI rose 0.5% MoM (vs. a 0.3% expectation) and +2.9% YoY.

Why It Matters: This is a classic “something’s creaking” tape: banks don’t drop like that on vibes—they drop when credit risk feels like it’s moving from spreadsheets to reality. If private credit is walking on egg shells, the next domino is tighter lending and higher spreads, which hits everything from small-business borrowing to commercial real estate refinancing (aka the economy’s least-fun group project). The AI angle matters too: when mega-cap tech can’t rally on great numbers, it tells you positioning is crowded—and crowded trades unwind fast when credit markets look cranky.

What to Watch: Watch whether the selloff broadens through private-credit vehicles (BDCs, private lenders) and whether banks start flagging exposure more explicitly—because the next “tell” is not a scary headline, it’s loan-loss language and suddenly stricter terms.
Source: wsj.com

2. Block Swaps 4,000 Humans for AI

The News: Block (Square + Cash App) said on Feb. 26, 2026 it will cut 4,000+ jobs—taking headcount from about 10,200 to just under 6,000—as it leans harder into AI tools across the company, per Reuters. The move comes alongside a strong quarter: Q4 gross profit rose 24% YoY to $2.87B (vs. $2.74B expected) and adjusted EPS was $0.65 (vs. $0.64 consensus), with $450M–$500M in restructuring charges expected.

Why It Matters: This is the cleanest case study yet for “AI = fewer seats needed,” and it won’t stay confined to tech—payments is basically back-office + ops + engineering, i.e., the exact jobs AI is chewing through first. For investors, the bull case is simple: lower costs, fatter margins, faster product cycles—hence the after-hours pop. For everyone else, it’s a preview of the next labor fight: if productivity jumps but payroll shrinks, wage growth and job stability can diverge fast (your rent does not accept “efficiency” as payment).

What to Watch: Block says it will finish the restructuring by end of Q2 2026, with most charges hitting Q1 2026—so watch Q1 results for margin expansion, and whether growth (Cash App, Square volume) keeps up once the org chart gets dramatically smaller.
Source: reuters.com

3. OpenAI Steps Into the Pentagon’s Anthropic Standoff

The News: OpenAI CEO Sam Altman told employees on Feb. 26, 2026 the company is pursuing a Pentagon deal to deploy its models in classified environments, as Anthropic nears a hard deadline in its own dispute with the Defense Department, per The Wall Street Journal. Anthropic says it “cannot in good conscience” accept terms that could allow mass domestic surveillance or fully autonomous weapons, and the Pentagon has warned it could cancel a contract worth up to $200M and even label Anthropic a “supply chain risk.”

Why It Matters: This is a real-time stress test of who sets the rules for frontier AI in national security: the companies, or the customer with the biggest budget and the loudest megaphone. If OpenAI lands a compromise that keeps red lines intact, it becomes the template for how “safe enough” AI gets adopted across government (and how quickly rivals get boxed out). And yes, there’s a public-markets angle: if a deal expands classified AI workloads in the cloud, Microsoft (Azure as the enterprise pipe for OpenAI) and Nvidia (compute demand) are the cleanest proxies — if this turns into sustained procurement, not a one-off headline.

What to Watch: The immediate catalyst is the Pentagon’s 5:01 p.m. ET deadline on Feb. 27, 2026 for Anthropic — watch for whether DoD actually pulls the $200M contract / “supply chain risk” trigger, and whether OpenAI announces a classified deployment framework that satisfies the same guardrails Anthropic is refusing to drop.
Source: wsj.com

4. Dimon’s “2007 Vibes” Meet a Real-Life Blowup

The News: JPMorgan CEO Jamie Dimon warned investors on Feb. 23, 2026 that parts of today’s profit chase look “uncomfortably familiar” to 2005–2007—citing stretched valuations and mounting strain in private credit. Days later, London property lender Market Financial Solutions collapsed into administration after creditors alleged “double pledging” of collateral and a potential £930M shortfall—spooking lenders tied to the deal and dragging shares of exposed firms.

Why It Matters: This is how credit cycles usually start: not with a bang, but with a weird corner of the market doing something dumb with collateral. If “double pledging” shows up again, it raises the uncomfortable question Dimon always asks: is this one cockroach… or the first one you noticed? For regular people, the knock-on effect is tighter lending standards—harder (and pricier) mortgages, small-business loans, and refis—because banks and private lenders tighten up right when you’re trying to borrow.

What to Watch: Watch for two concrete tells: whether regulators/lenders disclose actual loss estimates tied to MFS exposure (Barclays, Jefferies, and others have been flagged as creditors), and whether more asset-based/private-credit deals suddenly come with tougher terms—higher spreads, lower advance rates, stricter collateral controls.
Source: reuters.com

5. The AI Trade Is Breaking Portfolios (So the Rich Are Spreading Out)

The News: Creative Planning CEO Peter Mallouk says his 3,400 ultra-wealthy clients (each $25M+ net worth) are “more diversified than ever” because AI is driving weirder, faster sector whipsaws. The poster child this week: Nvidia posted $68.1B in quarterly revenue (+73% YoY) and guided $78B next quarter—then the stock still fell 5.5%, wiping about $259B in market cap in a day.

Why It Matters: This is the new investing problem: the fundamentals can be great and the stock can still get smoked because expectations are to the moon. For consumers, that volatility bleeds into real life via retirement accounts and 401(k)s—especially when the market is top-heavy and a handful of names can swing indexes. For investors, Mallouk’s point is simple: AI doesn’t just reward “tech”; it reshuffles winners and losers across everything from energy to staples, so concentration risk is the silent portfolio tax.

What to Watch: Watch whether the “sell-the-news” reaction spreads beyond chips into software and mega-cap tech—and whether diversification shows up in the data as rotation into international stocks, gold, real assets, and liquid alternatives instead of everyone crowding into the same 10 tickers.
Source: finance.yahoo.com

1. Prime Editing’s First “Cure” Moment

The News: A 19-year-old from Kelowna, B.C. — Ty Sperle — has been declared cured of chronic granulomatous disease (CGD) after receiving prime-edited versions of his own blood stem cells, in a Phase 1/2 trial run by Prime Medicine. In earlier trial readouts, Prime Medicine’s PM359 restored the key immune function marker in 58% of neutrophils by Day 15 and 66% by Day 30 (well above a ~20% threshold often cited for benefit), with no serious adverse events attributed to the therapy.

Why It Matters: This is the “rare disease” version of a moon landing: one patient, one mutation, one fix — and suddenly a lifetime of daily antibiotics turns into… normal life. Big picture: prime editing is pitched as a more precise cousin of CRISPR because it can make targeted edits without requiring double-strand DNA breaks, which could lower certain safety risks (still early days, still needs years of follow-up). For investors and healthcare systems, the prize is huge (curative therapies), but so are the frictions: complex cell processing, hospital infrastructure, and the “okay, who pays for this?” reimbursement fight.

What to Watch: Next up is proof of durability at scale: PM359’s Phase 1/2 study is designed for 12 participants (including kids age 6+) with long-term follow-up that can stretch 15 years, so each new patient update matters.
Source: globalnews.ca

2. Bezos’ Industrial AI Shopping Spree (With Sovereign Wealth Money)

The News: Jeff Bezos’ AI startup, Project Prometheus, is in talks to raise tens of billions of dollars from heavyweight institutions — including sovereign wealth funds like the Abu Dhabi Investment Authority — to build a holding company that buys industrial businesses “disrupted by AI,” per the Financial Times on Feb. 27, 2026. The discussions value Prometheus at about $30B pre-money, after it previously raised $6.2B.

Why It Matters: This is foreign capital trying to buy the “picks and shovels” of the next industrial era — not apps, but factories, aerospace suppliers, and advanced manufacturing. If sovereign wealth funds start writing mega-checks for AI-driven industrial roll-ups, it’s a signal that global investors see real returns in physical productivity (and not just model demos). The second-order effect: it puts more pressure on governments to decide what counts as “strategic” manufacturing — and who gets to own it — especially as U.S. policymakers get twitchier about supply chains.

What to Watch: Watch whether these talks turn into a named anchor commitment from a sovereign wealth fund (ADIA or peers) — and whether Prometheus pairs it with U.S.-friendly money like JPMorgan’s $10B Security & Resiliency Initiative (announced Oct. 13, 2025) to make the vehicle politically palatable while it goes shopping.
Source: ft.com

3. U.S. Warplanes Pile Into Saudi Base

The News: Satellite imagery shows the U.S. sharply ramped up aircraft at Saudi Arabia’s Prince Sultan Air Base: 43 planes on Feb. 21, 2026, up from 27 on Feb. 17, before easing to 38 by Feb. 25, per Reuters. The mix matters: Reuters identified 13 KC-135 refueling tankers and six E-3 AWACS surveillance planes among the large aircraft — classic “sustainment + eyes” assets — as the broader deployment shifts 150+ U.S. aircraft into Europe and the Middle East, per The Washington Post.

Why It Matters: This is the stuff that changes risk prices fast: oil, shipping insurance, airline routes, and anything rate- or energy-sensitive doesn’t need a war to wobble — it just needs the odds of one to rise. For investors, a big support-aircraft buildup signals the U.S. is positioning for options that go beyond symbolism (refueling and airborne surveillance are how you keep air ops running). And for consumers, the downstream hit is boring but real: higher fuel costs tend to show up in gas, groceries, and flights long before anyone sees a headline they like.

What to Watch: The near-term catalyst is diplomacy with a clock on it: Oman said the latest U.S.-Iran talks in Geneva ended Feb. 26, 2026 with “significant progress,” with technical follow-ups expected next week in Vienna — all while Trump has floated a 10–15 day window from Feb. 19, 2026 for a deal.
Source: reuters.com

Q: What did the policeman say to his belly button?

A: You’re under a vest.

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