Author: user user

The start of earnings season is exposing a potential crack in the stock market’s frothy foundation: risky lending by some regional banks.

Shares of Zions Bancorp and Western Alliance Bancorp plunged Thursday after the companies said they were victims of fraud on loans to funds that invest in distressed commercial mortgages. The disclosures sent the KBW Bank Index to its worst day since April’s tariff tantrum.

They followed a warning from JPMorgan Chase and Co. CEO Jamie Dimon about ‘cockroaches’ in the credit market during the bank’s earnings conference call on Tuesday. He was referring to the implosions of auto lender Tricolor Holdings and car-parts supplier First Brands Group.

With Wall Street already on edge, the chatter about troubled borrowers hitting banks is tapping into fears that a credit crisis could be the pin that pops the three-year bull market in stocks.

‘The market kind of freaked out,’ said Sadiq Adatia, chief investment officer at BMO Global Asset Management, which has $221 billion in assets under management.

From one angle things look great in the financial industry after the first full week of the third-quarter earnings season featured a string of beats from financial giants like Bank of America Corp., Morgan Stanley and Goldman Sachs Group Inc. But next week will offer a different view, as regional lenders such as Zions, Western Alliance and East West Bancorp Inc. are scheduled to report.

‘People are just a little bit spooked and kind of selling first and asking questions later,’ said Zachary Hill, head of portfolio management at Horizon Investments.

In many ways, the finance world is being divided in two. Big banks and Wall Street giants are racing ahead with strong trading and investment banking operations, and their size insulates them from a few bad loans. Smaller firms, however, don’t have that cushion, so the risks are more acute.

Investors are already seeing the difference. The KBW Regional Banking Index plunged the most since April on Thursday, wiping out its gain for the year, while the KBW Bank Index, which includes major national lenders and Wall Street titans, is up 14 percent in 2025.

‘If we’re going to get some continued uncertainty in the banking sector and questions around credit quality, then the large banks are definitely a safer refuge than the regionals,’ Hill said.

The risk, of course, is that problems at a few regional lenders can spread to big banks and, from there, into the broader economy. Even ‘mild’ credit concerns are ‘not good for an expensive stock market,’ said Matt Maley, chief market strategist at Miller Tabak + Co. The tech sector is worth watching ‘very closely,’ he added.

During the first half of the year, there was a ‘huge move’ in lower quality companies and everything related to artificial intelligence, said Adam Parker, founder of Trivariate Research. But now investors are trying to find some ‘ballast’ in their portfolios with stocks that aren’t exposed to these risks, ‘whether it’s higher quality financials, whether it’s health care, whether it’s metals,’ he said.

Still, sentiment remains strong for the big financial names and the sector as a whole.

‘As long as the vast majority of banks, particularly the systematically important ones, are doing OK, the sector will shrug off problems at certain institutions if they appear to be idiosyncratic rather than systemic,’ said Steve Sosnick, chief strategist at Interactive Brokers.

Friday’s batch of earnings reports helped allay some concerns, as Truist Financial Corp., Regions Financial Corp. and Fifth Third Bancorp all reported lower provisions for credit losses than analysts expected.

In general, Wall Street is bullish on third-quarter bank earnings, as the larger lenders are ‘hitting the ball out of the park,’ said Sam Stovall, chief investment strategist at CFRA Research. Analysts now expect financials to post 13.4 percent earnings growth in the third quarter versus the previous forecast of 8.9 percent, he wrote in a note to clients on October 15.

More broadly, banks have also provided ‘a welcome optimistic look at the macroeconomy,’ Peter Williams, economist at 22V Research, wrote in a note to clients on Oct. 15. At a time when data from the Bureau of Labor Statistics and other US agencies isn’t available due to the government shutdown, Williams noted that the bank earnings show ‘consumer spending trends continued to look solid.’

Wall Street will get a closer view of consumer health later this month when Visa Inc. and Mastercard Inc. report. Given the rising concerns about credit, those will be closely watched and have the ability to ‘spook the rally,’ Trivariate’s Parker said.

That being said, bullish investors are likely to view any drop as temporary and a chance to buy into the growth in financials at a lower price.

‘If we have further pullbacks from here, that’ll create a buying opportunity for us,’ BMO’s Adatia said, adding that he’s encouraged by the big banks’ results.

IN the ongoing flood control investigations, the search for truth and justice no longer hinges solely on confessions or whistleblower testimonies to investigating government agencies. The key to unraveling the complex web of corruption lies in lifestyle checks relying on accessing evidence, both physical and digital footprints. This involves the process of gathering and assessing data that is abundant, precise, and verifiable.

The lifestyle check should be directed against the various perpetrators, including their families, infamously now known as ‘neo babies.’ These perpetrators cover a broad range of individuals, including private contractors, Department of Public Works and Highways officials, members of Congress, both senators and congressmen, and conniving people from other government agencies.

The lifestyle check is a process of comparing a person’s declared lawful income against his apparent wealth. Data from declared income can be accessed from the Bureau of Internal Revenue (BIR). I speculate that several of the perpetrators may not even be registered as taxpayers with the BIR, or have minimal declarations in their tax returns. That should be a factor that the BIR can pursue to their advantage when the examiners start conducting lifestyle checks as part of their tax investigation of the flood control criminals.

Another reference source for lifestyle checks against erring government officials is their Statement of Assets, Liabilities, and Net Worth (SALN). The Civil Service Commission and Ombudsman are among several government officers tasked to collect the SALNs of all government officials and employees. I have observed that a large number of government officials have been reckless in preparing their SALNs, with them not reconciling their increase in net worth to the amount of income declared in their tax returns. This unexplained increase in net worth can result in various outcomes, including BIR tax assessments and forfeiture of assets under Republic Act No. 1379, or the Forfeiture Law. Under this law, the government can petition the courts to seize properties unlawfully acquired by public officials whose assets are grossly disproportionate to their lawful income.

The indicators of their wealth and lifestyle can be accessed from or provided by various government agencies. To derive the true and full wealth of lifestyle check targets, the search for these asset-holdings should include those properties registered in the names of the targets as well as those listed in the names of persons they have designated to hide under their names the ownership of properties that the targets own. These include immediate relatives, conduits, dummies, fronts, and beneficial owners of corporations of the targets.

I now discuss the various Lifestyle Check Data Sources. If the recipe for conducting the lifestyle investigation is coordinated among these various government data sources, then the investigations can proceed swiftly and decisively, eliminating overlaps and delays among agencies and transforming fragmented data into actionable intelligence for prosecution and recovery.

The Land Transportation Office provides records of vehicles, often the first indicator of unexplained wealth-fleets of Sports Utility Vehicles and luxury cars registered under names of contractors, government officials, or their family members. The public works contractors Discayas alone have around 30 luxury vehicles that the Bureau of Customs has seized.

The Land Registration Authority (LRA) provides the registry of real property ownership-houses, lots, and condominiums that paint a clearer picture of a public servant’s or contractor’s true wealth. The LRA has long computerized the real property records and can be relied upon for digitally retrieving ownership information of the flood control offenders and their cohorts.

The Securities and Exchange Commission offers another window into the flood control corruption through its beneficial ownership registry. Many contractors implicated in the flood control irregularities are not listed shareholders but hidden beneficial owners of multiple interrelated companies. Cross-referencing corporate filings and financial statements can uncover these connections, showing how public officials or their relatives may secretly control or profit from entities awarded government contracts.

The list continues with my discussion next week.

THE Philippine Basketball Association (PBA) has evolved over the past five decades into something far greater than just a basketball league.

For generations of fans, the PBA has become a tradition, a part of everyday life and for aspiring players, it has become a dream to chase the pinnacle of basketball in the country.

And for the Philippines itself, it stands as an institution, a formative and enduring part of the nation’s culture and passion for the game.

The PBA has created stars and legends, produced unforgettable moments and built communities that transcend the court and as it continues to thrive, the league marked a new milestone in its storied journey.

Last October 4 and 5, the Philippines’ premier basketball league welcomed its historic 50th season in style, a golden celebration honoring its fans, its heroes, and its legacy.

Giving back to fans

THE PBA would not be where it is today without its legions of fans-whether they’re Dugong San Miguel, a member of the Barangay or part of the Tropa, the fans are part of the PBA family, and they’re the ones who keep the league going strong.

That’s why the recent Saturday’s Fans Day festivities were a way for the league to show its unending gratitude.

Held at the historic Smart Araneta Coliseum in Cubao, fans were treated to a Meet and Greet with some of the PBA’s brightest stars, as well as a surprise performance from the PBA All-Star Band featuring PBA stars June Mar Fajardo, Japeth Aguilar, Raymond Almazan, Ricci Rivero and Keith Datu.

The day culminated in a thrilling fireworks display that lit up the Quezon City sky.

Pinoy hoops legacy

THAT night was a celebration of the PBA’s stars and legends as the league’s 50 Greatest Players and Hall of Fame inductees were honored at the PBA Fellowship Night, which took place at the Meralco Theater in Ortigas.

Among the greats who graced the event were the likes of Romeo Frank, Danny Basilan, Felix Flores, Angelito ‘Amang’ Ladores, Jimmy Manansala, Woodrow Balani, Manny Victorino, Rudolph Klutch, Danny Florencio, Marlou Aquino, Bong Hawkins, Hector Calma, Jojo Lastimosa, Gerry Esplana and Elmer Cabahug.

Undeniable icons like Atoy Co, Benjie Paras and Alvin Patrimonio were also some of the night’s most notable attendees.

The PBA Fellowship Night was also a way to recognize and give thanks to the league’s often unheralded stars, including former production staff, media and referees.

Performances by Gary Valenciano, Martin Nievera, Bituin Escalante and Mitoy Yonting with The Draybers made a memorable night even more special, as the event played out like a heartwarming reunion for the PBA family.

Honoring Excellence

ON Sunday, the best players of the previous season got their turn in the limelight, as the annual Leo Awards honored those whose performances stood out during the PBA’s 49th Campaign.

June Mar Fajardo, who’s already considered one of the best to ever play in the league, continued to make history as he claimed his record-setting ninth PBA Most Valuable Player award.

The honor placed him in a different stratosphere as the only player to win the prestigious award more than four times in his career.

While Fajardo continues to add to his legacy, freshman RJ Abarrientos is just starting to build his as the Barangay Ginebra San Miguel ace captured the first of what should be many individual accolades after being named Season 49’s Rookie of the Year.

The five best players from last season were named to the PBA First Mythical Team. The marquee name, of course, was Fajardo, who was joined by Robert Bolick, CJ Perez, Arvin Tolentino and Calvin Oftana.

Fajardo was also named to the league’s All-Defensive Team, along with Glenn Khobuntin, Zavier Lucero, Stephen Holt, and Joshua Munzon.

Speaking of Munzon, the Titan Maxx star was also named Most Improved Player, while Rain or Shine’s Gian Mamuyac took home the Sportsmanship Award.

Closing out with ‘Clasico’

SUNDAY night marked the start of the 50th season and fans got to witness an opening day concert featuring the likes of Randy Santiago, K Brosas, Mitoy Yonting, Ana Ramsey, Carmela Lorzano, Mike Hanopol, Jett Pangan, Quest, Sam Coloso and Cueshé, who performed the official theme song for the new season.

To put a bow on an incredible opening weekend and to officially get the PBA’s golden season underway, two of the league’s most decorated and most popular franchises faced off.

Barangay Ginebra San Miguel took on the Magnolia Chicken Timplados Hotshots in what’s known as the Manila Clasico, the PBA’s equivalent of a rivalry game.

Under the brightest of lights and in the presence of the PBA’s Greatest Players, Hall of Famers, and the Board of Governors, Ginebra and Magnolia put on a show as always. In the end, it was Magnolia who came away with an 80-73 win for the first W of the PBA Season 50 Philippine Cup.

The PBA’s Solid Weekend wasn’t just a spectacle-it was a statement-that after 50 years, the league still knows where it comes from, and who it plays for.

Beyond the hardwood, the trophies, and the legends, the PBA has always been about the fans. And as the league steps into its next chapter, one thing remains certain-the game stays solid because of the fans whose passion never fades.

WATCHING Shohei Ohtani strike out 10 Milwaukee Brewers and belt three home runs in the game to send the Los Angeles Dodgers back to the World series was breathtaking. For me, the greatest individual performance in Major League Baseball history. And I have been a fan of the game since 1976; watching on television or live in the ballpark.

What I love about Ohtani is how he is smashing conventional thinking that has been the norm for so long-that one can be effective as a two-way player. Maybe Ohtani is a generational talent as there aren’t many who both hit and pitch. But this should change.

And there’s Nikola Jokic of Serbia and the Denver Nuggets who is the best player in the National Basketball Association. While Jokic is not doing anything new because European big men have been doing this since the 1980s, the fact that he is totally dominating the National Basketball Association (NBA) is incredible.

Like Ohtani, Jokic is a two-way player on offense and defense. He is the first player in NBA history to finish in the top three of scoring, rebounding, and assists in a single season.

Before Ohtani and Jokic, some athletes challenging the norm were two-sport stars such as Bo Jackson and Deion Sanders. Both played in Major League baseball (MLB) and the National Football League (NFL).

Sanders accomplished it in the same season. More than that, as a member of the New York Yankees, he hit an inside-the-park homerun on September 5, 1989, against the Seattle Mariners then five days later, scored on a 68-yard punt return touchdown (after nearly being brought down) in his Atlanta Falcons debut against the Los Angeles Rams! During that play, Sanders dropped the ball and evaded three tackles. That was an example why he is nicknamed, ‘Prime Time.’

However, it should be noted that Sanders was cut after that and went on to sign with Atlanta. Then Yankees General Manager Gene Michaels said that Sanders’ NFL aspirations were affecting his baseball game.

While that season was a wash out with the Yankees, generally, Sanders did have quite a career .

On a similar note, Deion also played in the World Series and the Super Bowl (including winning back-to-back titles with two different teams).

I thought then that it would be one of the more amazing feats I’d see in my lifetime until Ohtani and Jokic came along.

In five seasons playing pro baseball in Japan, Ohtani posted a 42-17 pitching record. Over at MLB, he has been very good with a 39-20 record.

Batting wise, you simply cannot compare with a .282 BA, and .582 slugging average. In eight seasons in MLB, he has hit for 280 home runs as opposed to the 48 he knocked out in Japan. Yes, he was younger then and is only getting better. And he is only 31 years old.

It is the same thing with Jokic.

While playing for two professional seasons in Serbia with Mega Basket, he averaged 13.4 points, 7.3 rebounds, and 2.5 assists per game.

Over at the NBA, in 10 seasons with the Denver Nuggets, the 30-year old is averaging 21.8 points, 10.9 rebounds, and 7.2 assists in 745 games. During the play-offs, the numbers are even higher-27.4 points, 12.3 rebounds, and 7.6 assists.

He’s only 30 years old and his personal achievements in the NBA are already incredible. It’s simply too many to list here. Let’s just wait until he hangs up his sneakers.

I may not be a Dodgers or Nuggets fan but I follow both Ohtani and Jokic. I love that they are smashing records and changing the norms of the game. By the time they are done, who knows if they will be in their respective GOAT conversations? I, we, are lucky to watch them in our lifetime.

In June, French president Emmanuel Macron held an exclusive dinner at the Élysée Palace with a special guest: Nvidia’s Jensen Huang. Wine glasses clinked in honor of a deal his company had just unveiled with Mistral, the leading French artificial intelligence startup, to develop France’s largest data centers.

Huang, dressed in a black t-shirt amid the Parisian suits, paused the celebrations for a brief warning about AI. ‘The problem in Europe and in France is: You are too slow,’ Huang teased the attendees, according to Eléonore Crespo, an AI entrepreneur at the dinner. ‘It’s like your wine. You wait for it to age, to be perfect.’

Many European leaders are now working to prove Huang wrong. The continent, long known as more of a tech regulator than an innovator, is moving with renewed urgency to claim its piece of the global AI boom. Europe’s scarce tech giants, SAP SE and ASML Holding NV, have in recent weeks committed billions of euros to homegrown AI startups and services tailored to the bloc. Heads of state, from Macron to British Prime Minister Keir Starmer, have made splashy pledges to invest in massive data centers they cast as critical to national security and growth.

Europe’s push mirrors efforts around the world, from Canada to South Korea to the Middle East, where governments are frantically marshalling resources to avoid ceding too much of the AI market to the US and China. Across Europe, there are fears that a failure to invest heavily in AI locally will mean losing talent and abandoning yet another tech revolution to Silicon Valley, according to interviews with more than two dozen policymakers and technology executives. Increasingly, officials also worry Europe risks being overly reliant on a handful of large American companies, with its access to a vital technology vulnerable to Donald Trump’s trade war and whims. In Brussels, there are serious conversations about a so-called ‘kill switch’-a fear that Trump could force US companies to turn off services if that furthers his agenda.

But Europe, like most regions, has yet to prove it has the technical and financial wherewithal to credibly rival the US and China in every – or any – corner of the AI industry. Many see potential for European firms to sell AI-powered applications, cloud services and military tech. However, there are significant doubts about whether the continent’s sluggish economies can or should compete in the costly global battle to develop the advanced computing chips or cutting-edge large language models that underpin AI software.

Those debates are becoming more pronounced as governments simultaneously tout the importance of domestic AI efforts while leaning on US firms, including Nvidia and OpenAI, to prop them up. In September, for example, Starmer hosted Huang and other US tech luminaries to announce more than £31 billion ($41 billion) worth of AI spending pledges-a move that prompted immediate criticism that the UK was handing over critical keys to the US.

‘At this moment, Europe is so dependent that we don’t have much bargaining power,’ said Alexandra Geese, a European parliamentarian from Germany who advocates shedding as much US tech as possible. ‘You become a colony.’

Made in Europe

Crespo, the entrepreneur, is a poster child of sorts for Europe’s emerging AI sector and its limitations. Her startup, Pigment, offers AI tools for financial planning to rival an iconic American product: Microsoft Excel. During dinner gatherings and foreign trips, Macron has promoted Pigment as a future tech leader, driving ‘a new wave of customers,’ she said, including large French and British businesses that are on their way to signing deals. But to compete with US products, Crespo relies on American tech – namely models from OpenAI, which counts Microsoft as its biggest backer.

‘You are not going to be able to wait 10 years for a technology to be developed in Europe to say, ‘Oh, now we are sovereign,” she said.

Nvidia’s Huang has been a relentless crusader for ‘sovereign AI,’ a squishy, catchall term that typically means each country owns and controls the necessary data, chips and data centers to support AI. The idea has caught on in Europe, albeit sometimes in a confused way. In September, SAP announced a ‘sovereign’ effort to offer ‘AI solutions that are built in Germany, for Germany,’ by partnering with San Francisco-based OpenAI.

Increasingly, however, European companies are racing to prove local players can fill in the gaps. Nebius, an Amsterdam-based AI cloud provider, signed a contract with Microsoft Corp. worth as much as $19 billion. Black Forest Labs, a German startup making AI image-generation tools, has partnered with Elon Musk’s xAI and Meta Platforms Inc. And Mistral recently raised funds from ASML and other investors at an pound 11.7 billion valuation, cementing it as Europe’s top AI model maker.

These firms are vying to reduce the need for US tech and ensure the continent doesn’t miss out on AI the way it did with online search, e-commerce, social media, smartphones and cloud computing. ‘Essentially what we are living through is the trauma of a lot of the regional leaders analyzing their histories and going, ‘We don’t want a repeat of that,” said Anjney Midha, a partner at Andreessen Horowitz and board member of Mistral and Black Forest Labs.

In a sign of the times, several newcomers have entered the AI chips market, a notoriously challenging field dominated by Nvidia. These companies argue the provenance of AI hardware is as vital as the data being processed or the models created. Nations without their own semiconductor firms or workforces ‘risk becoming a vassal state,’ said Walter Goodwin, founder and CEO of Fractile, a British chips startup.

The push for homegrown alternatives has gained momentum due to concerns about Trump. In April, after the White House announced its first wave of global tariffs, the rhetoric in Europe intensified. The EU released its plan to become a ‘global leader’ in AI, which includes subsidies for chips and large data centers, or ‘gigafactories.’ Clara Chappaz, then France’s digital minister, gave a speech about cloud computing, calling on Europeans to ‘work as a pack’ in a ‘world of predators.’

There is growing distrust in Europe, not only over tariffs but about the privacy and security of American services. A law passed in Trump’s first term, the Cloud Act, enables US law enforcement to request data from abroad. In June, Microsoft executive Anton Carniaux made waves when he told a French Senate inquiry he ‘cannot guarantee’ information on French citizens would be protected if the US government demanded it. The executive said the company tries to fight these requests and there are no instances of this happening to a European customer. Still, Benjamin Revcolevschi, the CEO of French provider OVH Cloud, said this wasn’t the first admission from a US firm. ‘There will be others.’ An emerging ‘Eurostack’ political movement has argued that European entities should be required by law to purchase homegrown tech services. Geese, the German politician and a Eurostack proponent, believes that relying on less advanced alternatives to ChatGPT or Microsoft Azure is worth the technological independence. ‘We’re going to get there,’ she said. ‘It’s not that we’re stupid. It’s just less investment.’

Macron, who has tussled with Trump over tariffs and Europe’s digital sovereignty, has done more than most to prop up local options. He’s pledged to spend pound 109 billion on data centers and equipment and regularly promotes startups like Mistral and Pigment.

In July, Macron brought several French entrepreneurs, including Crespo and Mistral’s Arthur Mensch, on a diplomatic trip to the UK. Despite its fractious exit from the bloc in 2020, the UK has kept knitting partnerships on critical technologies-including AI-with some of its European neighbors. Peter Kyle, a British cabinet secretary, said the two countries have discussed pooling supercomputing resources and other partnerships. He’s also adopted Macron’s boosterism.

Still, last month, when the UK unveiled major investment plans on AI infrastructure, it wasn’t with French firms. It was with Nvidia, OpenAI and Microsoft.

Coming up short

For all the activity, Europe’s public and private investments are dwarfed by the US. The largest US tech firms are set to spend $344 billion this year, largely on data centers for AI. The EU’s long-term AI investment plan calls for spending about $100 billion less than that in total.

At a buzzing AI conference in Paris this summer, Paul Bloch, the president of Nvidia partner DataDirect Networks, brought up the EU’s plan to spend pound 20 billion subsidizing data centers it calls gigafactories. ‘It seems like a lot,’ he told the audience. ‘It’s really not.’

Whether there’s enough capital to compete is unclear. Economic growth is sluggish across Europe. Macron has just set up France’s third government since September, and that too is at risk of collapse over concerns about debt. And there are simply no European tech companies with the financial muscle of US firms like Microsoft, Amazon.com Inc. and Alphabet Inc.’s Google.

The limits of Europe’s AI push can be seen in France. Scaleway, a cloud provider from telecom billionaire Xavier Niel, has invested pound 3 billion, most of it in AI data centers, and secured more than five thousand advanced chips, according to Aude Durand, deputy CEO of Niel’s Iliad Group-a tidy sum, but far less than American rivals. Durand said Europe’s political geography also makes it difficult to expand. ‘Every time you open a new market, there’s new regulation, there’s new constraints,’ she said. ‘It’s not as easy as in the US.’

Even Europe’s top software company, SAP, can’t keep pace with the US investment frenzy. The firm, whose market cap is about a tenth of Microsoft and Google, said it would allocate pound 20 billion for sovereign services over the long term, a tenfold jump from its promised figure a year before. ‘The world changed,’ explained Thomas Saueressig, an SAP executive. But that amount is less than some US tech firms spend in a quarter. SAP has also wavered on its approach to sovereign AI. Christian Klein, SAP’s CEO, began the year calling for a replica of Stargate, the $500 billion infrastructure project Trump announced with OpenAI. ‘Europe needs it the most,’ Klein told CNBC in January.

But in an August op-ed, Klein called the EU plan to subsidize large centers and chips ‘a misguided solution to the wrong problem.’ Instead, he said Europe should stick to its strengths: focusing on promoting AI software and applications. European data centers, even if run by a local operator, will still need equipment from Silicon Valley and Asia, Klein said. ‘The hardware train has left the station,’ he wrote.

There are signs others in Europe agree. Last quarter, Nvidia attributed $20 billion in annual sales to sovereign AI purchases. Britain’s new supercomputer, in Bristol, is being built in partnership with Nvidia. The company also had deals with cloud projects in Germany and Italy.

Europe isn’t ready to give up completely on building up its own infrastructure. Despite Klein’s position, the German government has endorsed the gigafactory plan, arguing that local cloud operators should be involved. The Schwarz Group, Germany’s largest retailer, is planning to invest pound 11 billion into its nascent cloud service over the coming years and is bidding to develop one of the EU gigafactories. Unlike in chips, that market has more room for competition.

Macron also selected a British provider, Fluidstack, to develop a gigawatt supercomputing facility, with hopes to break ground on the data center-the startup’s first-early next year. CEO César Maklary, a native of France, said his firm’s nimbleness and AI-first focus can help it beat US cloud giants.

‘We’re deciding today what our future looks like. If we are handing the keys to non-sovereign companies, there’s always a potential risk,’ he said. ‘There’s a French saying: You’re always better served by yourself.’

Near the Japanese city of Nagoya, Takumi Yamaguchi pulls on a motorcycle helmet and sprints along an asphalt track before releasing a drone that looks like a 6-foot-long model airplane. It crashes shortly after takeoff.

Yamaguchi’s startup, AirKamuy, can afford such mishaps because it makes cheap, mass-produced drones-out of cardboard, of all things. He sets off another test run, which goes much better. The drone buzzes around an artificial island not far from Nagoya’s main airport before returning for a landing. Engineers will gather data from the flights to adjust the device before producing the final model. If all goes well, Japan’s Ministry of Defense will buy these so-called origami drones for missions that could include surveillance and swarm attacks in which the device would carry small bombs.

Like many younger Japanese, Yamaguchi, 29, says he feels the need to do more to protect his country, which has long been attached to the ideal of pacifism. Concern is rising about China seizing nearby Taiwan, as well as threats from a volatile North Korea and a belligerent Russia, just to Japan’s north. ‘We’re surrounded by these problems,’ he says.

In many other countries, Yamaguchi’s startup would be unremarkable. Venture capital money is pouring into drones because they’ve been so successful in the Ukraine war. But risk-averse Japan has long had few startups and a taboo against the defense industry, including severe restrictions on arms exports. After its defeat in World War II, the country renounced the right to wage war and even maintain a military, adopting a US-written ‘peace constitution’ that’s remained unchanged to this day.

By the 1970s, Japan had, in fact, rebuilt its military, now one of Asia’s largest and best equipped. But it’s called the Self-Defense Forces, or SDF, and is more strongly associated with helping out during the country’s frequent earthquakes and other natural disasters. Only a handful of Japanese contractors supply weapons and other equipment to the SDF, which also imports weapons from the US. As recently as 2017, the Science Council of Japan, representing scholars advising the government, issued a statement expressing opposition to military-­research programs.

But opinion surveys show public support growing for a stronger defense. The new leader of the ruling Liberal Democratic Party, Sanae Takaichi, is a security hawk who’s called for more military spending, as have fast-growing smaller right-leaning political parties. Takaichi, who’s set to become prime minister, has also pledged to make a new push to amend the constitution to state Japan’s right to have a military.

In 2022 the government said it would lift defense spending from an informal cap of 1% of gross domestic product to 2% over five years. Japan has also been under pressure from the US, its only security treaty ally, to rely less on American protection. Billions of dollars have been earmarked to pay for new equipment, such as long-range missiles to deter potential aggressors and military satellites to monitor enemies, as well as to help build a stronger domestic defense industrial base.

Interest is also growing in a once-­languishing eight-year-old government program to support research initiatives that could contribute to national defense. Although the program’s budget remains small-¥11.4 billion ($77.1 ­million)-134 private companies filed applications this year through June, up from the recent low of 49 in all of 2021.

In October 2024, Japan started the Defense Innovation Science and Technology Institute, modeled on US Department of Defense agencies that seek to use emerging technologies to bolster national security. The Defense Ministry is also playing a role in helping startups connect to venture capitalists. ‘It is crucial to build a mutually beneficial relationship with startups,’ says Rumiko Ichikawa, principal senior coordinator at the Defense Ministry’s Acquisition, Technology and Logistics Agency.

In a landmark for defense exports, Australia announced in August that it would buy a fleet of warships from a Japanese consortium led by Mitsubishi Heavy Industries Ltd. It would be just the second major defense export deal Japan has secured since World War II-possible only because of a special exemption from an array of restrictions on exporting weapons overseas, including a prohibition on lethal military equipment.

In part because these rules limit possible markets, private money remains relatively scarce. Total funding for all startups in Japan last year reached $5.3 billion, 2.5% of the amount in the US, according to Japan Investment Corp., one of the country’s sovereign wealth funds. Japan’s VC industry mostly consists of firms owned by financial institutions or other big businesses. Many VC funds have internal restrictions on investments in companies working on military-­related technology. ‘The venture capital environment is weak in Japan,’ says Kousuke Saito, an international security specialist at Sophia University in Tokyo. ‘But defense innovation is very expensive.’

The Japanese government is pushing for products with both civilian and military applications. Such dual-use products might include autonomous navigation systems that can guide cars or missiles, or even materials such as high-strength fibers usable in clothes or fighter aircraft.

The Tokyo VC firm Coral Capital has invested in two dual-use companies: Oceanic Constellations, a sea-drone maker, and Ookuma Diamond Device, which produces energy-efficient semiconductors from diamonds that could have defense applications. ‘We know it will take time to get people here educated on defense tech,’ says James Riney, Coral’s chief executive officer and founding partner. Japan’s strengths in advanced engineering and technology could give it a competitive advantage in the defense startup sector, he says.

Another startup, ElevationSpace, is developing reusable modules to transport payloads to orbiting space stations. The technology could help defend against hypersonic weapons. Chief Operating Officer Kazunari Miyamaru came up with the idea after studying aerospace engineering at the National Defense Academy of Japan. ‘Japan and allied countries need to work together to react to new types of air threats,’ says Miyamaru, who adds that he’s approached the Defense Ministry and France’s MBDA Missile Systems Services SAS, Europe’s largest missile maker.

Yamaguchi, the origami-drone maker, studied aeronautical engineering in college in Nagoya. In 2022 he was working in a division of Mizuho Bank Ltd. that provides financial support for startups. A client who was passionate about using drones for mountain rescues invited him to take part in a contest on the northern island of Hokkaido that sought to find which unmanned devices could find a target the fastest. Yamaguchi was hooked and decided to set up his own company. His parents expressed concerns about job security; the cultural preference for stable employment at an established company has stymied startup culture.

AirKamuy was originally formed as a venture to make drones to help find missing people in the mountains. Kamuy means ‘God’ in the language of the Ainu ethnic group, who live mostly in Hokkaido. The ­company name also nods to the idea of a drone saving a lost person. After a meeting with Defense Ministry officials at a drone exhibition several months later, the company pivoted to work on national ­security-along with civilian-applications.

In May, AirKamuy announced it had raised ¥100 million through the issuance of shares to three Japan-based funds, as well as loans from one commercial bank and the state-run Japan Finance Corp. Yamaguchi says about two-thirds of the venture firms he approached turned him down, some of them citing internal restrictions on ­investing in defense-related businesses.

The company’s main drone, the AirKamuy 150, is made of rain-resistant cardboard and designed to be manufactured at a low cost on a large scale. Yamaguchi says the drone’s price would likely start at $2,000, compared with millions of dollars for the high-end reconnaissance devices used by the US military and others. About 500 of the origami drones can be flat-packed into a regular shipping container, and they offer flight times of more than two hours, far longer than most devices. The company is in talks with the Defense Ministry about a contract, he says.

In August the agency said it was seeking more than $2 billion in its budget for the fiscal year starting in April to procure fleets of air, sea-surface and underwater drones. It said it would look at both foreign and local sources.

After the recent test flight, Yamaguchi takes off his motorcycle helmet, a safety precaution to avoid injury from the drone’s front-mounted propeller during launch. The work is challenging; still, he expects to have the product ready in the spring. ‘We have had various failures,’ he says. ‘But the accumulation of lessons from that process is important.’

Saying that the country is ‘lost’ due to corruption, a Catholic archbishop on Thursday appealed for an ‘eruption of conscience’ that would renew honesty, mercy, and solidarity among the people.

Speaking during Mass for the pontifical coronation of the original image of the Virgen sang Barangay at the San Sebastian Cathedral in Bacolod City, Archbishop Victor Bendico of Capiz said the nation is ‘lost amid corruption that continues to wound our institutions.’

He also lamented a ‘moral decay that poisons even our leaders’ and a ‘culture of lies and indifference’ that has dulled the Filipino people’s sense of right and wrong.

‘There must be an eruption from within us, not of lava and destruction, but of grace and conversion-the eruption of conscience, of honesty, of mercy, of solidarity,’ Bendico said in his homily.

He likened the country’s turmoil to the natural calamities that frequently strike the Philippines, saying they ‘echo the turbulence within our souls and communities.’

The archbishop pointed out that true renewal must come through faith, repentance, and a return to God.

He emphasized that the coronation of the Virgen sang Barangay was ‘not merely a ceremony of gold and jewels,’ but a ‘proclamation of faith’ and a ‘call to mission.’

‘To crown Mary is to acknowledge her as our queen-not of power, but of love; not of dominion, but of compassion,’ he said.

Archbishop Charles Brown, apostolic nuncio to the Philippines, led the canonical coronation of the original icon of the Virgen sang Barangay during the Mass.

Bendico urged the faithful to live out their devotion by transforming their communities into ‘barangays of faith, hope, and love,’ where Christ is made present through Mary’s intercession.

He also paid tribute to members of the Barangay sang Birhen movement who, for 75 years, have carried the image of the Blessed Mother from home to home.

‘You are the living hands and feet of the Blessed Mother,’ Bendico said. ‘Through your tireless service, the rosary continues to echo in our barangays, keeping the flame of devotion alive through generations.’

Pope Leo XIV approved the Bacolod diocese’s petition for the canonical coronation of the image of the Virgen sang Barangay through a decree dated September 12, issued by the Dicastery for Divine Worship and the Discipline of the Sacraments.

The pontifical crowning took place on the image’s feast day, nearly seven months after the icon receivedepiscopal coronationon March 25.

Bendico reminded the faithful that the pontifical coronation marks not an end, but a new beginning for the Church in Bacolod.

‘The crown we place upon Mary is also a mission placed upon us-to make Christ reign in our barangays, in our workplaces, in our government, and in our hearts,’ he added.

‘May this crowned image remind us that holiness is possible, that renewal is near, and that hope, like grace, erupts quietly and powerfully when we allow Mary to lead us back to her Son,’ he also said.

Cardinal Luis Antonio Tagle took his titular post in the diocese of Albano in Italy on October 11, marking a significant step as a cardinal bishop.

The suburbicarian diocese of Albano, one of seven historic sees surrounding Rome, has traditionally been assigned to the Church’s highest-ranking cardinals.

While the title is conferred on a cardinal, the diocese continues to have its own resident bishop and administration.

The appointment of Tagle to Albano followed a historic turn earlier this year. The title had briefly been assigned to Cardinal Robert Prevost, who was scheduled to take possession on May 10 but was elected as Pope Leo XIV on May 8.

The titular church remained vacant until it was formally assigned to the Filipino cardinal and pro-prefect of the Vatican’s Dicastery for Evangelization on May 24.

Tagle was elevated to the rank of cardinal bishop by Pope Francis in 2020, joining the Church’s highest order of cardinals. At that time, he retained his titular church of San Felice da Cantalice a Centocelle, as there were not enough suburbicarian dioceses available.

With his assumption of Albano, Tagle succeeds the current pontiff in the historic role of cardinal bishop of the diocese.

The ceremony at the Albano Cathedral, according to the Pontificio Collegio Filippino (PCF), was presided over by diocesan bishop Vincenzo Viva and attended by local clergy and lay faithful.

Tagle was accompanied by a large group of Filipinos, including members of his family, residents of the PCF, and members of the Filipino community in Italy. Two other cardinals, three bishops, and about a hundred priests concelebrated the Mass.

The event carried double significance due to a recent Filipino ecclesiastical anniversary and a notable date in the Church calendar. Just days earlier, on October 7, the PCF celebrated the 64th anniversary of its inauguration.

The PCF, a key institution for Filipino diocesan priests studying in Rome, was blessed and inaugurated by Pope St. John XXIII in 1961-whose feast day also falls on October 11.

PCF Rector Fr. Gregory Ramon Gaston said the ties between the Filipino college and the Diocese of Albano date back to the college’s foundation.

He said it was Cardinal Giuseppe Pizzardo, then cardinal bishop of Albano and prefect of the Sacred Congregation of Seminaries and Universities, who laid the cornerstone of the new college-seminary, dedicated to Our Lady of Peace and Good Voyage.

‘This historical fact means that the cardinal bishop of Albano played a direct, foundational role in establishing the Collegio Filippino,’ Gastons said.

Who is Taylor Swift’s heir apparent? Her 12th album, ‘The Life of a Showgirl,’ offers an answer. It’s Taylor Swift.

Her last album, ‘The Tortured Poets Department,’ ended with the cautionary ‘Clara Bow,’ an allegory that seemed to suggest her tenure atop the cultural mainstream was inherited from stars of the past, like the namechecked Stevie Nicks – and that a new generation of younger, elastic female pop performers could soon take her place. In 2025, there are many to choose from: Consider Chappell Roan’s full-throated theatrics, Olivia Rodrigo’s fiery punk-pop feminism, Sabrina Carpenter’s cheeky sexuality. In the knotty themes of Friday’s ‘The Life of a Showgirl,’ best illustrated in the title track, Swift asserts that the baton hasn’t been passed, but rather shared. Because she isn’t going anywhere.

‘And all the headshots on the walls / Of the dance halls are of the b– / Who wish I’d hurry up and die,’ she sings with a wink, ‘But I’m immortal now, baby dolls / I couldn’t if I tried.’ Notably, if she has a chosen successor in someone else, it’s the album’s sole feature: Carpenter, who sings on the stomp-clap closer in her newly adopted twang. The mournful glissando of lap steel – the album’s most country moment – arrives only with Carpenter’s introduction. The western genre is Swift’s past and Carpenter’s future.

Suggestive bangers and a ‘New Heights’ namecheck

If Swift is co-signing Carpenter, she’s also learning from her. Carpenter has cornered the market on tight pop songs with pert, provocative messages; Swift does the same with the manspreading swagger of the George Michael-interpolating ‘Father Figure,’ which mentions a protege, and the funky ‘Wood.’ (A carefully veiled PG-13 lyric: ‘His love was the key / That opened my thighs,’ she sings. ‘Girls, I don’t need to catch the bouquet / To know a hard rock is on the way.’) Interwoven are suggestive, sensual ad-libs . and a direct reference to fiance Travis Kelce’s podcast.

Across a brisk 12 tracks – Swift’s tendency toward abundance doesn’t manifest itself in a double album this time around, but instead in her endless vinyl variants – ‘The Life of a Showgirl’ mostly delivers on its promise of up-tempo pop ‘bangers,’ to borrow her own vernacular. Fans need not wait up for the long-anticipated ‘Reputation (Taylor’s Version),’ because ‘The Life of a Showgirl’ pulls from its essence. But this time, with a lot of affection, like a truer ‘Lover’ era.

Swift has long internalized criticisms and responded to them in her art, most directly in 2017’s ‘Reputation.’ Here, she is once again concerned with her perception, articulated over booming, lush production on ‘CANCELLED!’ or ‘Elizabeth Taylor.’ On the latter, she sings, ‘Hollywood hates me / You’re only as hot as your last hit, baby.’ Except this time, her love acts as an anchor. ‘I can’t have fun if I can’t have you,’ she flirts.

Welcome (back) to Sweden

For ‘The Life of a Showgirl,’ Swift enlisted Swedish producers Max Martin and Shellback, the hitmaking duo she collaborated with on 2012’s ‘Red,’ 2014’s ‘1989’ and, of course, ‘Reputation.’ Notably absent is her frequent producing partner Jack Antonoff. It’s a wise decision: In years past, Swift, Shellback and Martin’s pop experiments shifted not only her career trajectory but the genre itself. Before ‘I Knew You Were Trouble,’ an EDM drop in the middle of a radio pop hit was unimaginable. After, the style would dominate for half the decade.

‘The Life of a Showgirl’ isn’t as seismic, but there are addictive and idiosyncratic Swiftisms here: acerbic wit and thick literary references in glassy pop hooks. Where a song like ‘Opalite,’ if attempted by another other performer, would lose its weightlessness under its voluble aspirations, Swift manages to swoon. Stacked, opalescent harmonies and a vintage swing give the song, fittingly, an almost iridescent quality.

And there are bops, like the undeniable opener ‘The Fate of Ophelia’ with its 1980s-via-Robyn synth-pop and momentary ‘Summertime Sadness’ vocal delivery.

There’s a treasure trove of deliciously quotable lines, too, as expected. ‘Please God bring me a best friend who I think is hot,’ she manages to make effortless in the ‘Midnights’-esque ‘Wi$h Li$t,’ a lovely song about the mundanity of romance and the suburban fantasy of ‘a couple kids . a driveway with a basketball hoop.’

The dictionary of a showgirl

Swift’s dense vocabulary is on full display, often full of charm. But it is sometimes unwieldy, a common criticism of ‘The Tortured Poets Department,’ like when she overstuffs ‘Our thoughtless ambition sparked the ignition on foolish decisions which led to misguided visions’ into ‘Father Figure,’ momentarily overvaluing clever writing over clever cadence.

Or she is too modish. The colloquial ‘Eldest Daughter,’ for example, mentions ‘trolling,’ ‘memes’ and ‘comments,’ immediately dating itself. But sonically, it is a thoughtful acoustic ballad with emo movement, in which Swift contends with her ‘terminal uniqueness’ and deep dedication to a loved one. It juxtaposes nicely with something like the casually cruel, pop-punk affected ‘Actually Romantic.’ It’s hard not to hear some brief Hayley Williams in the distorted speakerphone vocals in the song’s coda or boygenius in its harmonies: another example of Swift pulling from those she’s influenced – and enlisted on her tours.

Swift has said ‘The Life of a Showgirl’ is meant to embody her ‘Eras Tour’ – a singular global phenomenon, a canonical event in the history of pop performance that, in its over three-hour runtime, was a sensory explosion. On these 12 tracks, she’s approximating glitz and glamour with humanity and humor. She spends no time waiting in the wings. So let the show begin.

The scale of Cup of Joe’s success is nothing short of cosmic. Not long ago, performing at the Smart Araneta Coliseum was simply a shared ambition.

Now, they are not only here but have turned that dream into a multi-night triumph: a three-day, sold-out concert run for ‘Stardust.’

From October 10 to 12, the five-member alternative pop band-featuring Gian Bernardino (Lead Vocals), Raphaell Ridao (Lead Vocals), Gabriel Fernandez (Lead Guitar), CJ Fernandez (Rhythm Guitar), and Xen Gareza (Keyboards)-commanded the iconic ‘Big Dome’ stage, taking fans on an unforgettable interstellar journey.

The Project Stardust: A musical journey

The Stardust concert was not merely a performance; it was an immersive, emotionally charged storyline that took the audience on a galactic quest.

During the first day, the narrative began with a mysterious figure, immediately revealed as Senator Kiko Pangilinan, who entrusted the five-man band with a critical mission: ‘Project: Stardust.’ Their task was to save the crumbling universe, planet by planet, by healing them through the power of their music.

This interstellar journey was mapped across five distinct emotional worlds.

They first unlocked Planet Crimson, which responds to sounds of euphoria and grandeur, performing powerful anthems like ‘Silakbo,’ ‘Sinderela,’ ‘Tataya,’ and ‘Wag Na Lang.’

Next, they transported the audience to Planet Ivory, a world that resonates with warmth and bright frequencies, where they delivered heartfelt tracks like ‘Mananatili,’ ‘Ikaw Pa Rin Ang Pipiliin Ko,’ ‘Tingin’ (featuring Janine Teñoso), ‘Hulaan’ (also with Janine Teñoso), and ‘Misteryoso.’

The quest continued to the Pink Planet, whose inhabitants cherish nostalgia, myths, and legends. Here, the band brought back favorites like ‘Estranghero,’ a passionate mash-up of ‘Sagada,’ ‘Nag-Iisang Muli,’ and ‘Hayaan,’ before welcoming OPM legend Gloc-9 for an electrifying version of Bagsakan. They concluded this segment with a surprise, emotional rendition of the Goo Goo Dolls classic, ‘Iris.’

Their descent into Planet Emerald tapped into deep vulnerability and solace, featuring soul-stirring performances of ‘Hinga,’ ‘Kanelang Mata,’ ‘Bubog,’ ‘Lahat ng Bukas’ (with OPM artist Keanna Mag), and ‘Pahina.’

Finally, they confronted the perils of Planet Azure, a place filled with the darkness and danger of helplessness, tackling powerful songs like ‘Bagyo,’ ‘Sandali,: and of course, their mega-hit, ‘Multo.’

The universal mission reached its triumphant conclusion with the encore, Patutunguhan, proving their music truly saved the day.

More than just a concert

Beyond a sold-out spectacle, the Stardust concert’s final night was a powerful evening of record-breaking achievement.

Cup of Joe was officially recognized by the Smart Araneta Coliseum for an unprecedented feat: becoming the first Filipino band in history to achieve five sold-out shows in the Big Dome within a single year.

This momentous plaque served as a testament to their massive popularity and the deep connection they share with their consistently growing fanbase.

The celebration continued with an acknowledgment of their artistic dominance. During the final show, Billboard Philippines publisher Anne Bernisca and managing editor Jason Caballa presented the band with a plaque recognizing their biggest song to date, ‘Multo.’

At the time of the award, ‘Multo’ had held the coveted No. 1 spot on the Philippines Hot 100 and Top Philippine Songs charts for an unrivaled 27 straight weeks-the most by any artist since the charts were established.

This history-making achievement firmly established Cup of Joe as a powerhouse in the modern OPM landscape.

A legacy built on their shared universe

Another profound impact of the concert was its power to serve as a testament to Cup of Joe’s musicality and artistic growth. The six emotional planets were not just creative backdrops; they were powerful symbols of how the band’s songs resonate with the universal human experience, touching listeners who are navigating different emotions and battles in their lives.

Their music has evolved into a boundless force-a motivation, a consolation, a mood booster, and a source of healing among others-attracting an ever-growing audience because of its profound relatability and universal appeal.

The band’s evolution over their artistry is mirrored in this journey. They transformed from young artists still discovering their sound and genre into the powerhouse they are today, integrating diverse musical influences and collaborative spirits.

Not only that, their genuine, down-to-earth personalities shine through, allowing them to effortlessly carry entire segments-from cracking jokes and quick-witted lines that guarantee an uproar from the crowd, to even owning their sponsor acknowledgments and turning them into charming, signature ‘Cup of Joe’ moments.

This ability to be completely themselves is undoubtedly a key reason for their massive relevance and popularity among the younger generation.

As the spectacular concert drew to a close, the final question lingered: What, truly, does ‘Stardust’ represent?

Does it pertain to the loyal Joewahs, the dedicated fanbase that acts as a mass of distant stars, lighting up the band’s skies and constantly reminding them of how far they’ve come? Or does it represent the five members themselves-the dreamers and storytellers who continuously attract and connect with people who need their music for inspiration and healing?

The truth is, both of them are Stardust. Together, they are a cosmic force that forges a unique universe founded on music, powerful narratives, and genuine connection. Their unprecedented success, capped by a sold-out three-day run at their dream venue, proves that, perhaps, everything was already foretold by the stars and had been aligned all along.