Chapter 1: What is the main topic discussed in this episode?
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Chapter 2: What is the significance of the EU-India free trade deal?
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Hiring? Do it the right way. with Indeed. Today's number? 338. That's how many dollars it costs to apply to become bankrupt in the United States. That makes America one of the few places in the world where you have to pay to be broke. Welcome to Profiteer Markets. I'm Ed Elson. It is January 28th. Let's check in on yesterday's market vitals.
The S&P rose to a record high on optimism for big tech earnings. That gain came in spite of US consumer confidence data, which actually fell to its lowest level since 2014. Meanwhile, UnitedHealth dragged the Dow into the red. More on that in a moment.
The yield on 10-year treasuries rose ahead of the Fed's decision out this afternoon, and the dollar continued its slide to a four-year low as President Trump dismissed concerns about the currency's decline. He said, quote, I think it's great. He also said, quote, I could have it go up or go down like a yo-yo. Okay, what else is happening?
The EU and India have finalized a historic free trade agreement. The deal, which comes after two decades of talks, will phase out tariffs on the vast majority of goods. That move is expected to double European exports to India within the next six years. Timing of the deal is also telling. It landed just after President Trump's threats over Greenland strained relations with Europe.
Meanwhile, India faces U.S. tariffs as high as 50% on key goods, which raises an important question. Are America's allies hedging their bets? Here to help us answer that... We're speaking with Liz Hoffman, business and finance editor at Semaphore. Liz, welcome back to Profiteer Markets.
Hey, Ed.
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Chapter 3: How is the healthcare stock market reacting to recent changes?
I mean, really just like immediately a historic document, kind of a speech for the ages is what happened. Larry Fink, the CEO of BlackRock, called it when I talked to him at the end of the week.
And really, this was a call to arms to these middle powers to say, you know, there's been this rupture, he called it, in the world order, and we can either forge our own way or really recede under that wave. And, you know, Carney had, I think, either just been or was on his—I think he'd just been in China, where he had signed a huge trade deal between Canada and China—
Chapter 4: What does the Medicare payment increase mean for health insurers?
that taking a step back is actually a remarkable alliance. It wasn't that long ago, if you remember, there were these huge geopolitical tensions between Canada and China. Canada had arrested a Chinese Huawei executive. I mean, this was really fraught relations between the two countries. And now you have this big trade deal
that among other things will bring Chinese EVs, these really fantastically futuristic, the tech is great, they are cheap electric vehicles to Canada, right on America's doorstep. And it all felt like a bit of a middle finger to Donald Trump.
Also, he gave like the first couple of minutes of the speech in French, which really felt like standing up for, you know, a kind of multilateralism and globalism that Donald Trump has really tried to dismantle. So, you know, that was kind of a call to arms. And then right on the back end of it, we see this this huge trade deal between India and the EU.
And these are goods that, you know, in a different tariff regime would be headed here.
Right.
And, you know, will not be because of the tariffs that the White House has put on particularly India.
I recently saw Mark Carney spoke about that speech, which, as you said, I mean, everyone considered it to be groundbreaking. I've seen Canadians saying it's the best speech that Prime Minister of Canada has ever given. Apparently, he told the president, I meant what I said. Those were his words. It seems like he is doubling down on this.
It appears that perhaps Europe is also doubling down on this position. We're going to find allies elsewhere. Do you expect that we will see more of these trade deals? I mean, it seemed like maybe the ball was starting to get rolling. I was wondering whether it would stop in 2026, but it appears to be accelerating. Would you agree with that?
I would. The EU has, you know, opened and extended trade talks with some of their other partners.
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Chapter 5: How does Trump's healthcare plan impact Medicare Advantage?
The thing that really crystallized for Europe in particular, but for a lot of other countries when Donald Trump started this trade war— back in the spring of 2025, was they said, oh, we are really reliant on the U.S., right? And that's what gave the White House so much of its power on the way in. And, you know, they had some early success striking some of these trade deals.
But the alternative, if you were Europe or India or Japan or Canada— is to say, oh, we are too reliant on the U.S. and to go find partners elsewhere. And, you know, the world is a big place and it is fragmenting, you know, one word that was, Davos always coins these slightly ridiculous phrases.
And one that I heard a lot last week was mini-lateralism, kind of as a replacement for multilateralism.
And that these big global trade webs that largely flowed through the United States, kind of as a global protector and hegemon and kind of, you know, good corporate citizen, are being replaced by these more localized, more bilateral agreements and arrangements that increasingly are going to flow outside of Washington and around Washington.
Probably at least, you know, to some degree in the near term to the detriment of American consumers.
Okay. Liz Hoffman, business and finance editor at Semaphore. Liz, appreciate your time.
Anytime, Ed. Always a pleasure.
After the break, healthcare stocks take a dive. And for even more markets content, you can subscribe to my weekly newsletter at edwardelson.substack.com.
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Chapter 6: What are the potential risks associated with AI according to Dario Amodei?
It's more popular than ever. And two, every company that makes AI is absolutely hemorrhaging cash. On the Vergecast this week, we're talking about what OpenAI and other companies are doing to try to finally figure out how to make some money off of this technology. Spoiler alert, it's mostly ads. And we're talking about whether any of it's actually gonna work.
All that, plus some stories about the Chinese company that appears to be beating Tesla on The Vergecast, wherever you get podcasts.
We're back with Profiteer Markets. Healthcare stocks cratered yesterday on the Trump administration's plan to keep Medicare rates flat next year. The Center for Medicare and Medicaid Services announced just a 0.09% payment increase for Medicare Advantage plans. That is far below the 4-6% increase that analysts were expecting.
This announcement coincided with UnitedHealth's earnings miss, which also added fuel to the sector-wide sell-off. CVS Health closed down 14%, UnitedHealth dropped nearly 20%, and Humana fell 21%. Here to help us break down what is happening in the health insurance industry, what this plan means for health insurance companies, we're speaking with Michael Haas, Senior Research Analyst at Baird.
Michael, thank you for joining us on ProfgMarkets. Thank you very much for having me. It's a pleasure.
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Chapter 7: How could AI affect job markets in the near future?
So this proposal, this plan, It's a 0.09% payment increase for Medicare Advantage plans in 2027.
Chapter 8: What are the implications of AI on society and human purpose?
Not really clear what that even means, but I'm looking at CVS Health, UnitedHealth, Humana. All of these stocks are cratering right now. Why is this happening?
Great question. And let me take it at a very high level, and then I'll drill in. And basically, Medicare, I'll take it at the highest level. Medicare is health insurance for seniors over the age of 65. So think of it as health care. U.S. health care is about a $4 trillion to $5 trillion market. Medicare itself is about a quarter of that, right? Call it a trillion. So when you think about...
how important of a role it plays in the overall health care within the U.S. It's significant. And your largest players are your UnitedHealth, your Humana, your CVS, the names that you just called out. And they're all down close to 20%. So the way to think about it is this is run by the federal government. And how their pricing works is clearly volume, price, volumes, and membership.
Pricing is determined by the federal government under HHS via a department called CMS. And every year in January, they provide a proposed rate notice called the advanced rate notice. And basically, if there's a benchmark rate that every health plan gets for a senior, that rate should, in theory, every year, go up to track cost trend.
And long story short is a flat rate increase, 0.9%, like you mentioned, does not cut it. Because right now, the cost trend environment in Medicare Advantage world, it's mid-single digit to high single digit. So... 1% rate increase. There's a huge delta. That's incredibly insufficient. And the importance of this is this might catalyze into 2027. Because remember, this rate notice is for 27.
Seniors getting their benefits cut across the board and it impacting membership next year in a very significant way. Because remember, if the health insurers are getting hit on rate and revenue, their levers are benefits. That's the main lever right there.
I was going to ask you, what are the implications for the consumer? Whenever I see something like this, my sort of knee-jerk reaction is, oh, he's pulling down profits for these healthcare companies. Maybe that means more money in the consumer's pockets, less money in the insurance company's pocket. Maybe that's why the stock's down, but it sounds like that's actually not right.
This could negatively impact the consumer. Is that right? Exactly.
Negatively will impact the consumer and negatively impacts the health insurance companies themselves. And when you think about benefits, right, the... the ones that you can really feel and that's most tangible to you, right? It might be your dental benefits, your vision, things of that nature for seniors matter a lot. And there's a multitude of them.
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