US Seizure of Russian Tanker Upsets Shadow Fleet Strategy

The United States government is actively considering an investment in critical minerals mining projects in Greenland, according to Amaroq CEO Eldur Olafsson. The discussions precede high-stakes talks between Washington and Danish officials over the strategic future of the Arctic island.

Amaroq is a mining company focused on South Greenland, where it is exploring and extracting deposits of gold, copper, germanium, and gallium, among other key minerals.

Washington Considers Direct Investment in Amaroq Projects

In an interview, Amaroq's CEO Eldur Olafsson confirmed that discussions with U.S. government bodies about potential investment opportunities are ongoing, though no final agreements have been reached.

Olafsson detailed that a potential deal could involve several forms of U.S. support, including:

• Offtake agreements

• Infrastructure support

• Credit lines

He declined to specify which projects have attracted U.S. interest.

When asked for comment, a U.S. State Department spokesperson stated, "The United States is eager to build lasting commercial relationships that benefit Americans and the people of Greenland." The spokesperson also noted that "President Trump reiterated the importance of Greenland to U.S. defense and underscored his commitment to the relationship by designating Governor Landry as Special Envoy to Greenland."

The Export-Import Bank of the United States (EXIM) did not respond to a request for comment.

Greenland's Strategic Role in US National Security

These investment talks are unfolding as U.S. President Donald Trump has increased his focus on acquiring Greenland, which he views as vital to national security. The renewed interest follows a recent military operation to seize Venezuelan President Nicolas Maduro.

European governments have been working to formulate a response to the escalating rhetoric from the U.S., which has not ruled out military action. Adding to the urgency, U.S. Secretary of State Marco Rubio is scheduled to meet with Danish officials next week to discuss the future of Greenland, which is a self-governing Danish territory.

The Race for Critical Minerals and China's Dominance

For the White House, Greenland's vast mineral deposits represent a strategic opportunity to challenge China's control over the global supply of critical minerals.

Earlier this week, rare earth companies with projects in Greenland saw their stock prices surge following U.S. comments about acquiring the island. While President Trump has recently framed the issue around national security, former national security advisor Mike Waltz clarified in January 2025 that the U.S. fixation on the island was primarily about "critical minerals."

Is Arctic Mining Economically Viable?

Despite the strategic interest, some experts have raised concerns that extracting minerals from Greenland is not economically feasible due to the island's harsh conditions and lack of infrastructure.

However, Amaroq's CEO, Eldur Olafsson, argued that mining is realistic with careful planning and logistics. He drew parallels to major mining operations in Russia and Alaska, which were developed under similar challenging conditions.

Olafsson noted that while transporting minerals over long distances on land is a major hurdle for many mining projects, Greenland offers a unique advantage. Many of its mineral deposits are located near "deep fjords," which could significantly simplify the process of shipping them to global markets.

Furthermore, climate change is altering Greenland's landscape. Melting ice has exposed wetlands, shrub areas, and barren rock, making some of the island's strategic mineral reserves more accessible to mining companies.

U.S. Treasury yields rose on Thursday as investors braced for two pivotal events: the release of December's employment data and a potential Supreme Court decision on key tariffs.

Yields ticked higher across the curve by less than three basis points, rebounding from earlier lows. The move was supported by fresh economic data showing improved productivity and weekly jobless claims holding near recent lows. A rise in oil prices after a two-day slide also contributed to the upward pressure on yields.

Despite the sell-off, some analysts believe the Treasury market has a "strong underlying bid" that could cushion the impact of strong economic news, according to Andrew Brenner, vice chairman at Natalliance Securities. Brenner noted that a ruling on tariffs "could send rates in either direction," highlighting the uncertainty facing bond investors.

Fed Rate Cut Expectations Hinge on Jobs Data

The upcoming December employment report is the main event for market participants, as it could reshape expectations for Federal Reserve interest rate policy in the year ahead.

Last year, the Fed delivered three rate cuts in response to signs of a weakening job market. However, with some central bank officials now signaling a desire to pause due to inflation risks, the new data carries significant weight.

Currently, traders of short-term interest rate products are pricing in minimal odds of a rate cut at the Fed's next meeting on January 28. The market is, however, anticipating two cuts by the end of the year. In a notable move in the options market on Thursday, one trader purchased a $7.5 million call option on 10-year note futures, a position that protects against a rally in bond prices (a fall in yields).

Supreme Court Tariff Decision Poses Fiscal Risk

Investors are also closely watching the Supreme Court, which could rule on the legality of tariffs implemented by the current administration. These tariffs have become a source of revenue that helped narrow the U.S. budget deficit in fiscal 2025.

An abrupt end to this revenue stream could trigger a negative knee-jerk reaction in the Treasury market, reflecting concerns over the nation's fiscal health. A similar market response was observed in early November when the court heard oral arguments on the case, even though the White House has alternative legal options available.

Heavy Bond Supply Adds to Market Pressure

Supply dynamics are also playing a crucial role in pushing yields higher. This week is shaping up to be one of the largest on record for new investment-grade corporate bond sales, which directly compete with Treasuries for investor capital. A staggering $88.4 billion in corporate debt was sold in just the first three days of the week.

Adding to the supply pressure, the Treasury Department is scheduled to auction new three-year and 10-year notes on Monday. All of next week's auctions have been scheduled earlier than usual to ensure they conclude by their January 15 settlement date.

Source: Bloomberg Europe

WASHINGTON, Jan 8 (Reuters) - U.S. worker productivity grew at its fastest pace in two years in the third quarter as businesses invested heavily in artificial intelligence, depressing labor costs.

Nonfarm productivity, which measures hourly output per worker, accelerated at a 4.9% annualized rate, the Labor Department's Bureau of Labor Statistics said on Thursday.

That was the quickest pace since the third quarter of 2023 and followed an upwardly revised 4.1% growth rate in the second quarter. Economists polled by Reuters had forecast productivity would grow at a 3.0% rate after a previously reported 3.3% pace of expansion in the April-June quarter.

The report was delayed by the 43-day federal government shutdown.

Productivity grew at a 1.9% rate from a year ago. Businesses are spending on AI, which economists said could further boost productivity. The jump in productivity helps to explain the gap between strong gross domestic product growth and a lackluster labor market. The economy grew at a robust 4.3% rate in the third quarter. In contrast, private job gains averaged 55,000 per month in the three months through October.

Unit labor costs - the price of labor per single unit of output - decreased at a 1.9% rate in the third quarter. That followed a 2.9% pace of decline in the April-June quarter. Labor costs increased at a 1.2% rate from a year ago.

Source: Investing

The U.S. Supreme Court is poised to rule on the legality of President Donald Trump's sweeping tariffs, with a decision possible as soon as January 9. This high-stakes verdict will determine the fate of a cornerstone of Trump's economic agenda after lower courts found the import taxes were imposed illegally.

The tariffs have remained in effect while the Trump administration appealed to the nation's highest court. During a hearing on November 5, justices expressed skepticism about the president's authority to unilaterally impose these levies under a 1977 emergency law. A ruling against the administration would mark Trump’s most significant legal defeat since returning to the presidency and could trigger complex legal battles over billions of dollars in refunds.

The Legal Battle: Presidential Power vs. Congress

The core of the case revolves around the constitutional separation of powers. Article 1 of the U.S. Constitution explicitly grants Congress the authority to levy taxes and regulate foreign commerce. Over the years, lawmakers have delegated limited trade powers to the president through various laws.

In his first term, Trump tested the limits of these powers. This time, he invoked the International Emergency Economic Powers Act (IEEPA) of 1977, claiming it gave him nearly unlimited authority. The administration cited U.S. trade deficits and cross-border drug trafficking as national emergencies, using IEEPA to justify the tariffs through executive orders.

This move was unprecedented. The IEEPA, which is typically used for sanctions, does not mention tariffs. Lower courts, including the U.S. Court of International Trade, ruled that the law does not delegate "an unbounded tariff authority to the President," a decision later affirmed by the U.S. Court of Appeals for the Federal Circuit. The judges clarified that their ruling was not on the wisdom of the policy but on its legality, stating the president's actions were "impermissible... because [the law] does not allow it."

A Breakdown of the Tariffs Under Review

The Supreme Court's decision specifically targets the "Liberation Day" tariffs announced on April 2. These levies are structured in several layers:

• A minimum baseline tariff of 10% on most imports, with some exceptions.

• "Reciprocal tariffs" ranging from 10% to 41% on goods from nations that did not secure trade deals with the U.S.

• Additional levies on certain imports from Mexico, China, and Canada, which Trump justified by citing the fentanyl crisis.

It is important to note that this case does not affect all of Trump's tariffs. Levies on steel, aluminum, automobiles, copper products, and lumber were imposed using a different legal basis—Section 232 of the 1962 Trade Expansion Act—which allows for tariffs if imports are deemed a national security risk by the Commerce Department.

Billions in Refunds and Fiscal Uncertainty

If the Supreme Court strikes down the IEEPA-based tariffs, the administration would not only lose the ability to collect them but would also face demands to refund duties already paid. More than 1,000 companies have already lined up in court seeking reimbursement.

This potential unraveling of a major revenue stream could worsen concerns about U.S. public finances. The administration had previously pointed to increased tariff revenue as a way to offset tax cuts from a bill Trump signed on July 4. A sudden reversal could amplify questions from bond market investors about the country's growing debt load.

In a separate but related case, a federal judge in Washington also declared some of Trump's tariffs unlawful, though the ruling was limited to the two family-owned toy manufacturers that filed the lawsuit.

What's Next for Trump's Trade Policy?

Even a loss at the Supreme Court wouldn't completely disarm Trump's push to reshape global trade. The administration has other tools at its disposal, though they are generally more limited than the broad powers it sought under IEEPA. These alternatives include:

• Section 232: Continuing to use national security investigations to justify tariffs on specific product categories.

• Trade Act Provisions: Imposing temporary import taxes of up to 15% for 150 days, but only in the event of a "large and serious" balance-of-payments crisis or to prevent a significant depreciation of the dollar.

• Section 301 Investigations: Launching investigations into unfair trade practices by other countries, although this process is slower to implement.

The justices are set to return from a four-week holiday recess on January 9, which is scheduled as their first "opinion day," making it the earliest possible date for a ruling in this landmark case.

A December survey from the Federal Reserve Bank of New York reveals a growing disconnect in the American economic outlook, with consumers expecting higher inflation while their confidence in the job market has fallen to its lowest point in over a decade.

These conflicting signals highlight the complex challenge facing the Federal Reserve as it weighs its next move on interest rates.

Inflation Fears Tick Up, Job Confidence Plummets

According to the New York Fed’s monthly Survey of Consumer Expectations, Americans see prices rising by 3.4% over the next year, an increase from the 3.2% expectation reported in November.

At the same time, the survey painted a grim picture of the labor market. The perceived probability of finding a new job after a layoff dropped to 43.1%. This marks the lowest level of confidence recorded since the survey began in mid-2013, signaling significant anxiety about job security.

Longer-term inflation expectations, however, remained stable, with both the three-year and five-year outlooks holding steady at 3%.

The Federal Reserve's Policy Dilemma

This data captures the core debate within the central bank. Some Fed officials remain focused on taming inflation, while others see rising unemployment as the more immediate risk. The divergence between rising price expectations and falling job market confidence is likely to keep the Fed on hold, making an interest rate adjustment at its upcoming policy meeting improbable.

The survey's findings were released just ahead of key economic data, including the Bureau of Labor Statistics' monthly employment report and the upcoming consumer price index figures, which will provide a clearer picture of the economy's direction.

A Paradox in Household Finances

The report also uncovered conflicting views on personal financial health.

Consumers reported a higher probability of missing a minimum debt payment over the next three months, which climbed to 15.3%—the highest level since the economic turmoil of April 2020.

Despite this near-term financial pressure, a surprising wave of optimism emerged. The share of respondents who expect their personal financial situations to improve over the next year rose to its highest point since February 2025.