Call me Tuna King

MARKETS

• Global economy: A senior exec at the International Monetary Fund is sounding the alarm about the next recession. David Lipton told the FT, "We are less prepared to deal with that than we should be."

TECH

Not Your Mother’s Consumer Electronics Show

And not just because of the noticeable shortage of landline phones. The Consumer Electronics Show wows every year, but 2019 has some tricks up its sleeve that are sure to provide plenty of fuel for the internet this week.

In case your invite got lost in the mail, here's the 411: CES 2019 technically kicks off in Las Vegas tomorrow and runs through Friday, but a handful of companies started the madness yesterday. There'll be 4,500 exhibiting firms and 180,000 attendees from 150 countries.

So what makes 2019 so notable? For starters...

Tech is popping up at everyone's dinner table

At Thanksgiving, Aunt Rose wouldn't stop talking about Mark Zuckerberg going mano a mano with D.C. regulators over data privacy last spring. And don't get Dad started on Apple's stock price.

The big dogs at CES are hoping to steer the conversation away from the soap opera of regulation and profits under pressure, focusing instead on the potential of innovations including AI, robots, health tech, and the cloud. Oh, did we mention robots? Because they will be everywhere.

The trade war is also finding its way to the buffet

Keep the backdrop in mind: Tech IP theft is one of President Trump's main motivators for the China trade war. And the 90-day truce between the U.S. and China is closing in on its expiration date.

Companies will likely be chatting with manufacturers about shifting production away from China to avoid the (uber-expensive) trade war.

And you might even be able to find overhead bin space on flights from Shenzhen to Vegas this week. No Chinese tech execs are giving CES keynotes this year, and there will be more than 20% fewer Chinese exhibitors than last year.

And about the partial government shutdown...

It's hitting the CES guest list hard. FCC Chairman Ajit Pai and several other government officials won't be making the trip thanks to agency funding lapses.

STOCKS

The New Normal for the Market?

Volatility. The U.S. equity market (which is the largest in the world) has become more unstable than you when you're hangry, reversing its historical steady-as-she-goes course.

See, for years the U.S. market has been known for being reliably boring when compared to smaller, flashier equity markets. But now, the U.S. is earning a different kind of reputation, reported Bloomberg.

One volatility measure of the S&P 500 recently jumped to its highest reading versus the Euro Stoxx 50 since the financial crisis, and saw its highest reading versus Hong Kong's Hang Seng Index in seven years.

And the VIX (you've heard of Wall Street's fear gauge, right?) has outpaced equivalents in Europe, Hong Kong, and emerging markets several times over the last month. It tallied a record 14 one-day moves of more than 20% last year, and in the last three months alone, it's climbed 44%.

So what changed? The autumn sell-off shined a light on issues keeping traders up at night: a possible global economic slowdown, the China trade war, and rising interest rates.

TAXES

Talking Marginal Tax Rates

Any weekend in which income tax policy gets as much coverage as the NFL playoffs and the Golden Globes is a good weekend.

The debate kicked into gear when freshman U.S. Representative Alexandria Ocasio-Cortez (D-NY) suggested to 60 Minutes that she could be in favor of taxing the ultra-rich (who make more than $10 million) at a marginal rate of 60-70%.

Now, depending on your economic philosophy, you might think that's either an outrageous proposal or an idea worth implementing. Either way, it's a good time to learn something about our tax system:

• A "marginal" tax just means that as income rises, it's taxed at progressively higher rates which fall into certain brackets. So in this example, the 60-70% would apply to only the income Mark Zuckerberg brings in over $10 million.
• Currently, the top rate is 37% for households making more than $600,000.
• It used to be much higher. The top rate in 1980 was 70%, though there were many more brackets and loopholes than there are now.

FOOD

'It’s a Good Tuna, but I Think I Paid Too Much'

—Kiyoshi Kimura, the owner of the Sushi Zanmai restaurant chain and the self-described "Tuna King," after paying more than $3 million for a 612-pound bluefin tuna (or around $5,000 per pound).

Ya think?

Some context: The fish was bought at the first auction of the year held at Tokyo's new Toyosu fish market. Remember, the old, notoriously gritty market (named Tsukiji) was forced to relocate to clear the way for the upcoming Olympics in 2020. The new market cost ~$5 billion to build.

But why was the fish so expensive? Even by bluefin tuna standards, this price was exorbitant, almost 10x higher than that paid at last year's auction (thanks in part to a heated bidding war). But one long-term problem is that the species has been overfished nearly to extinction, with stocks of Pacific bluefin depleted by 96% from pre-industrial levels, according to the AP.

Bottom line, courtesy of a tuna expert at the Pew Charitable Trusts: "The celebration surrounding the annual Pacific bluefin auction hides how deeply in trouble this species really is."

CALENDAR

The Week Ahead

It's the first full week of 2019. You forgot about all your New Year's resolutions, didn't you.

Monday: JPMorgan Healthcare Conference; U.S. and China hold trade talks; National Bobblehead Day

Tuesday: International trade; JOLTS

Wednesday: FOMC minutes; Earnings (Lennar, Bed Bath & Beyond)

Thursday: Jobless claims; Jerome Powell speaks...and everyone listens

Friday: CPI inflation data; National Human Trafficking Awareness Day

WHAT ELSE IS BREWING

• The National Park Service is going to dip into entrance fees to fund certain operations during the government shutdown.
• Last night’s Golden Globes, as it happened.
• Sears is prepping for a potential liquidation, per Bloomberg. Apparently, Sears Chairman Eddie Lampert's $4.4 billion bid to revive the retailer isn't up to bankers' standards.
• Chipotle is rolling out new "lifestyle" bowls for the unfortunate among us adhering to diets like keto, paleo, and Whole30.
• José Muñoz, a top exec at Nissan expected by some to become its next CEO, is taking a leave of absence from the company.

BREAKROOM

Fish Trivia

We had fish on our minds, so we headed over to the Fulton Fish Market's website to do some shopping. Can you rank the following items by price?

• Oysters—Live, Atlantic, Pemaquid, Farmed (A dozen)
• Salmon—Alaskan King, Copper River, Superfrozen, Wild, USA (Two 8 oz
• Salt Cod—Baccala, Wild, Canada, Fillets (3 lb boneless and skinless fillet)
• Uni Roe—Sea Urchin, Fresh, Wild, East Coast, Peru (130 g container)

Breakroom Answers

Fish Trivia
Salmon: $90, Cod: $54, Uni roe: $40, Oysters: $30