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Get your copy wherever books are sold. Good morning from the Financial Times.
Today is Wednesday, August 13th. This is your FT News Briefing.
The White House is lowering the stakes for the Alaska summit, and Norway is pulling some of its money out of Israel.
Plus, sand. It's coarse and rough and irritating and it gets everywhere.
But what happens when sand starts to erode?
I'm Mark Filippino and here's the news you need to start your day.
The White House is playing down expectations for U.S.
President Donald Trump's meeting with Russian leader Vladimir Putin.
US allies have expressed concern about the summit.
They worry Trump could go for a quick end to the war by offering Putin Ukrainian territory.
But U.S. Press Secretary Caroline Leavitt says Friday's meeting in Alaska is a, quote, listening exercise. and that any peace deal would have to include Ukraine.
Still. The country's president, Vladimir Zelensky, is not invited to the upcoming summit.
The Norwegian government is getting a ton of pushback for its investments in Israel.
The country's $2 trillion oil fund is the largest sovereign wealth fund in the world.
And critics say its investments aid Israel's offensive in Gaza.
But this week, the country took action. Richard Milne covers the Nordic countries for the FTN.
He joins me now. Hi, Richard. Yeah, hi, Mark.
So I mentioned that critics have been going after Norway and the Norwegian fund over its investments in Israel.
What does that look like? Yeah, so this has been building for some time and it has reached a peak in recent weeks when... local newspapers have focused on Some Israeli companies that the fund owns that have, among other things, done something like maintained engines. on planes that have been bombing Gaza so on Monday the oil fund took some action and it's revealed that it had sold out of 11 of the 61 Israeli companies it had been invested in.
Now, just to put this into perspective, the Norwegian sovereign wealth fund is worth about $2 trillion. and a tenth of a percent of that was going to Israeli companies.
That's still $2 billion, if I have my math right.
Absolutely, yeah. The oil fund is just so huge.
It's a bit mind-boggling. I mean, on average, it owns 1.5%. of every single listed company in the world.
Being in a democracy, Norway has these guidelines.
They don't buy a lot of defense companies, ones that make nuclear weapon parts.
They don't invest in tobacco. And they don't invest in companies that help breach international law.
And that's really what this debate has ended up being about under a lot of public pressure.
Richard, while $2 billion is still a large chunk of money, there might be some people out there who say a Tenth of a percent of this fund is really small.
Why did the government... peel back some of its investments in Israel.
Well, one thing is that there's an election, parliamentary elections coming up next month and there's a very strong pro-Palestine feeling in Norway, maybe more than in many European countries.
I think the oil fund has become a lightning rod for criticism in Norway.
I think you have to look at it. I mean, Norway is a small country.
Its foreign policy influence isn't huge.
It's recognized Palestine as a state recently, which means that it's got even less influence with Israel than it might have done.
And so for Norwegian people, the one area that they can really put pressure on is the oil fields.
So Richard, do you think that other countries with sovereign wealth funds will be looking at what Norway just did with its investments in Israel and and try to replicate it, Not really, because Norway stands on its own.
It really is the only democracy that has a big sovereign wealth fund. all the other sovereign wealth funds are in autocracies.
It means it's much easier for one person or a small group of rulers to decide exactly what they want to do and uh Then you've got Norway that's pretty much invested in the world and pretty much invested in nearly every company in the world.
Now that has some great benefits of diversification, but they're finding out that it is really difficult to balance the interests of your owners who are the Norwegian people who have a very strong opinion here and other interests.
And so this is going to rumble on. The fund itself has said they're likely to sell out of more companies.
And I think we're going to see more changes coming as well in the week's ahead.
Richard Milne is the FT's Nordic and Baltic Bureau Chief.
Thanks, Richard. Thanks. Inflation in July stood steady in the US, according to a report released yesterday.
The Consumer Price Index held at 2.7%, the same as June, and it was actually a shade below what analysts were expecting.
Lower fuel prices helped bring down the number.
That being said... Core inflation, which strips out food and energy, actually rose by two tenths of a percent.
Investors seem to think that yesterday's report means that the Federal Reserve will cut interest rates at a faster pace So far, the Fed has been waiting to see whether President Trump's tariffs will cause inflation to go up before making any moves.
Beaches around the world are eroding because of climate change, and that's leading to a sand shortage. which then makes it more expensive to resupply the beaches.
Here to explain why this is so important is FT Data reporter, Eva Seau.
Hi, Eva. Hey, thanks for having me. Good to have you.
So tell me how bad is the problem here? So I guess first I'd like to say that this issue is... wildly different depending on where you are, and that's just because we live on a very diverse planet.
But I would say that in the US and North Carolina, it's so severe that Houses are literally falling into the ocean, and this is a place on the Outer Banks in Rodanthe, in this town on the Outer Banks. which is taking away houses that, you know, maybe a few decades ago were not having waves lapping near the houses at high tide.
So that's kind of maybe one of the worst case scenarios.
In the Gold Coast in Australia, the folks there are seeing more adverse weather patterns and storms can really... be like these more dramatic one-time events that take away sand.
And that too is kind of correlated with global warming.
So Eva, what are the larger consequences of this erosion?
That's a great question. So when beaches erode, there's an economic impact, For a lot of coastal communities with beaches, it's the lifeblood of their economy.
It's a billion-dollar asset. People will visit that town because of the beach.
The other part is that beaches form this buffer from flooding, from storms sometimes, and they're really important to protect other things. like roads or buildings, infrastructure, sometimes sewage waste treatment.
So having it a road away can be economically really damaging, but also I think in terms of coastal resilience, it can also be quite negative as well.
So what are people doing about all this erosion?
So one of the most popular and go-to methods that has been used for decades is called beach nourishment.
It's basically when you take sand from elsewhere, usually dredged nearby, and put it back on the beach.
Besides beach nourishment, there's also, I guess, what some people call, quote, like hard structures.
And these are things like jetties. which will block kind of the movement of sand.
But if it's not managed well, it can actually cause erosion nearby.
There's also seawalls, which also in some cases can have like this problem of exacerbating nearby erosion if it's not done properly.
So just out of curiosity, are these methods working?
With beach nourishment and even proponents of this method will say this, which is that it's temporary.
So... because there's these constant natural forces, erosion, tides, storms, Beach nourishment can last, let's say, in a very kind of dynamic place where there's a lot of motion, like two years later.
Places that are more stable, it could be 10 years, so a bit longer.
But because of that potentially short timeline, it does cost a lot of money.
Dredging in the U.S. is particularly expensive, so it can be like $20 million to, let's say, dredge like a million cubic yards or something. that's the case, is there a big answer here in order to help with sand erosion?
I think there unfortunately aren't any silver bullets to this problem.
And in places like Rodanthe, North Carolina, where there isn't money... to buy sand or dredge it, there won't be nourishment and the shoreline will continue to migrate inland. forcing people to retreat.
And also there's sea walls, which means you just kind of forego the idea potentially of having a beach and using the seawall to protect infrastructure.
It depends on where you are, but again, there's not like a huge array of options, I would say.
That's FT data reporter, Eva Xiao. Thanks, Eva.
Thank you. Before we go, Do Kwon, the founder of Terraform Labs, admitted to two counts of fraud yesterday.
It was part of a plea deal with US authorities.
Now you might remember Terraform Labs, The company was behind the cryptocurrencies Terra and Luna, and it went bust in 2022.
The collapse wiped out $40 billion, but up until now, Do Kwon has denied any responsibility.
He faces up to 25 years in U.S. federal prison and will be sentenced this winter.
You can read more on all these stories for free when you click the links in our show notes.
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