The fallout from the implosion of First Brands keeps spreading. Morgan Stanley’s asset-management business asked to redeem some money it invested in a Jefferies Financial Group fund with large exposure to the bankrupt auto parts supplier’s trade debt. Point Bonita, a unit of Jefferies’ Leucadia Asset Management, had about a quarter of its $3 billion trade-finance portfolio invested in First Brands-related receivables.

A newly appointed company board committee is now investigating First Brand’s use of roughly $2.3 billion of off-balance-sheet financing, Chief Restructuring Officer Charles Moore said in a court filing. Some of the inventory backing these facilities “may have been commingled” with collateral securing a separate asset-backed loan facility. The Trump administration also opened an inquiry into the circumstances around First Brands’ collapse, which seems to have caught some Wall Street heavy-hitters by surprise. —David E. Rovella

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Rather than negotiate with Democrats who forced a shutdown in order to lift an Affordable Care Act deadline that will leave millions without healthcare, Trump budget director Russell Vought is instead looking to leave thousands of federal workers without a job. The move by the Project 2025 co-author, a key force behind the widespread firings earlier this year, has reportedly been deemed likely illegal by the administration’s own lawyers. (Typically federal workers are furloughed during a shutdown.)

It’s the latest in a string of either facially illegal, unconstitutional or otherwise currently litigated attempts by the administration to amass power at the expense of Congress. Vought’s move also escalates the stakes over a shutdown that has Democratic leaders exercising what little leverage they have. Unions for federal employees have already sued to forestall the mass terminations and have now asked a judge to block today’s effort.

Russell Vought, director of the Office of Management and Budget Photographer: Aaron Schwartz/CNP

A series of trade war broadsides by China has managed to trigger a social media outburst from the White House. On Thursday, Beijing unveiled new curbs on its exports of rare earths and other critical materials on which it has effectively cornered much of the market. China required that overseas exporters of items that use even traces of certain rare earths obtain an export license, citing national-security concerns.

To add insult to injury, China slapped new port fees on American ships and said it started an antitrust investigation into US-based Qualcomm. President Donald Trump, who was to meet with Chinese President Xi Jinping soon, reacted angrily, responding that he doesn’t feel there’s a need to meet Xi now. Later on Friday, Trump—who has repeatedly threatened and retreated on tariffs (many of which have been declared illegal by the courts)—announced a new 100% tariff on China.

It wasn’t only Trump who felt jilted by China. Wall Street, which has been skating along for months despite America’s global trade war, did not respond well to the spat, with indexes tanking across the board. The S&P 500 fell 2.7% while the Nasdaq dropped more than 3.5%.

“Throughout the summer, greed has far outpaced fear in the US equity market, and the high level of complacency leaves investors vulnerable,” said Michael O’Rourke at Jonestrading. “The selloff has the potential to evolve into a larger correction, especially if the US-China trade truce is over.”

At the age of 79, Trump is the oldest president to be sworn into office in American history. Typically presidents have an annual physical, but on Friday Trump went to Walter Reed Medical Center for his second visit in six months. In the interim, Trump has been spotted with swollen ankles and a persistent bruise on his right hand. The White House press office said in July that Trump had been diagnosed with chronic venous insufficiency, but physicians had otherwise found the president to be in “excellent health,” the White House said. During his first term, questions about Trump’s health and mental fitness turned into a media firestorm following a glowing report by his physician at the time, Ronny Jackson, and a book by author Michael Wolff.

US President Donald Trump golfing in Turnberry, Scotland, in July. Photographer: Chris Ratcliffe/Bloomberg

A Brazilian mobile banking app owned by the billionaire Batista family’s investment holding company is said to be looking to raise as much as about $500 million in its US initial public offering.

PicPay is seeking to go public as soon as this year. Founded in Vitoria, Brazil in 2012, the company says it offers financial services including digital wallets, cards, loans and investments. The Batista family—which is behind meat supply giant JBS SA—invested in the company starting in 2015, and holds its stake through J&F Participacoes, an investment holding company.

Russia has intensified its air strikes on Ukrainian cities as part of a deliberate strategy to cripple the country’s energy system and demoralize its population after a summer offensive failed to gain traction.

As winter approaches, Russian missiles and drones triggered a blackout in Kyiv early Friday reminiscent of sprawling power disruptions in the capital in the first full winter of the full-scale invasion in 2022-2023. Destruction and outages in other regions across the war-battered nation spread as air defenses struggled to down hundreds of projectiles across Ukraine’s vast territory.

Kremlin forces have killed tens of thousands of Ukrainians over the course of Russia’s 11-year war on the country. Dozens of cities and towns have been flattened, Russian forces are accused of scores of war crimes and the International Criminal Court in 2023 issued a warrant for Vladimir Putin’s arrest. Meanwhile, just as Russia is suspected of eyeing NATO’s eastern flank, many of Putin’s ex-Soviet allies appear to moving away from him.

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