A.M. Edition for May 5. Warren Buffett marks the calendar for his departure from Berkshire Hathaway, announcing his handpicked successor will take the reins next year. Plus, the ‘Trump factor’ propels another left-leaning leader to a surprise election victory, this time in Australia. And WSJ South America bureau chief Juan Forero explains how production advances and long-distance smuggling vessels are transforming the global cocaine trade. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What recent announcement did Warren Buffett make?
We're seeing semi-submersibles in the last few years heading to Spain and and Portugal into the South Pacific. So we're talking about 9,000 miles. These are dangerous trips, but that's how much money is to be made by selling cocaine in some of these countries. It's Monday, May 5th.
Chapter 2: How are smugglers adapting to the cocaine trade?
I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today. Berkshire Hathaway chief executive Warren Buffett plans to step down at the end of the year, with the 94-year-old handing over the reins to his hand-picked successor Greg Abel.
Abel's selection wasn't a surprise, though the timing of the announcement was, silencing a cavernous arena of investors in Omaha, Nebraska on Saturday and triggering a wave of tributes from Wall Street titans.
While Buffett said that Abel would have final say at Berkshire starting next year, he said he didn't plan to disappear from the scene and used his remarks at the company's annual meeting, heard here courtesy of CNBC, to defend the global trade system, criticizing the antagonistic approach being taken in Washington toward America's economic partners.
It's a big mistake, in my view, when you have 7.5 billion people that don't like you very well, and you've got 300 million that are crowing in some way about how well they've done.
Meanwhile, President Trump is downplaying concerns about the economy, emphasizing that he believes his policies will trigger a historic boom. That forecast, made on NBC's Meet the Press, comes as we report that Trump and his advisors are feeling more confident following a streak of stock market gains and a better than expected jobs report on Friday.
There are many people on Wall Street who say this is going to be the greatest windfall ever happened.
And that's my question, the long term. Is it okay in the short term to have a recession?
Look, yeah, everything's okay. What we are, I said, this is a transition period. I think we're going to do fantastically. Are you worried about a recession?
No. While the White House is signaling that it expects some progress to cool trade tensions this week, including by announcing at least one deal with a country seeking to escape higher tariffs, President Trump said yesterday he'd authorized a new 100 percent tariff on films produced overseas.
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Chapter 3: What election dynamics are influenced by Trump in Australia?
And the Federal Aviation Administration has at times slowed traffic to Newark as a result of controller staffing issues. Danish drugmaker Novo Nordisk says the U.S. Food and Drug Administration has accepted a new drug application for an oral formulation of its blockbuster obesity treatment, Wegovii.
If approved, it would mark the first so-called GLP-1 drug to be available in pill form amid competition from the likes of Eli Lilly and others. Novo Nordisk said the FDA's deadline to decide on the application will be in the fourth quarter. And it is shaping up to be a busy week in markets, with services PMIs for April due out this morning and earnings from Ford expected this afternoon.
Though the biggest set piece will be the Fed's interest rate decision on Wednesday, with the central bank facing pressure from President Trump to lower rates sooner than the current June forecast. Coming up, potent powder and narco subs are driving a global surge in cocaine smuggling. We'll get the latest from Columbia on the exploding coca trade alarming American officials after the break.
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Chapter 4: How is Anthony Albanese managing Trump's influence?
Thank you.
Global cocaine supply has hit an all-time high, and while production has been steadily climbing for the past decade, drug officials are growing increasingly alarmed over the sheer speed of coca growth and new undersea modes of transport as the potent powder reaches new and faraway markets. Our South America Bureau Chief Juan Ferrero has been tracking cocaine production in Colombia.
Chapter 5: What innovative tactics is Ukraine using against Russia?
Juan, bring us up to speed here. What has shifted in the past few years?
What's happened lately is that coca, the leaf used to make cocaine, and cocaine itself has just shot up dramatically to record highs. In Colombia now, the UN says that, and this is in a report from late last year, said that there's 625,000 acres of coca. Now, that's about the size of Rhode Island, and that is 55% more than in 2000. And there was so much cocaine that
that year in 2000, that this drug was funding armed groups that were threatening the very Colombian state. And these American officials say, we were really worried that the state would be toppled. Now that was in 2000. Now there's 55% more coca in the country. And that produces, you know, the estimate that the 3,000 tons of cocaine.
That cocaine is now not just going to the United States, not just going to Brazil and Western Europe, which have for a long time been sort of the big main consumers, but it's going to places like Argentina, like the Balkans. It goes to Australia, New Zealand.
There's always new markets because in a lot of these markets, the amount that is being spent on cocaine just makes it very worthwhile from a business standpoint for drug traffickers.
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Chapter 6: What recent developments are affecting oil prices?
You talk about a lot of this coca cultivation happening in very remote areas and yet reaching markets around the world. What is the supply chain for this drug like now? It's not being carried on foot.
Some of the supply chain, the way that they're getting the cocaine to some of these markets is the same old, same old cargo vessels, go fast boats, which leave from Colombia and go to Central America and so forth. But I think one of the new trends we're seeing are the semi-submersibles. Now, these are submarine-like vessels.
They have been around for a long time, you know, but they're far better now. They have better propulsion. They're bigger. They can carry more cocaine and they can go a lot farther. So we're seeing semi-submersibles in the last few years heading to Spain and Portugal and so forth. But now we're seeing... semi-submersibles en route to the South Pacific. So we're talking about 9,000 miles.
It's very far. And of course, these are dangerous trips, but increasingly we're seeing these semi-submersibles head in that direction. That's how much money is to be made by selling cocaine in some of these countries.
What does the Colombian government make of all this? If there really is territory the size of Rhode Island being used to cultivate a drug like this, they can't be unaware of what's going on.
Columbia's government has taken the approach that it wants to steer clear of penalizing farmers. And so they are very much opposed to aerial fumigation. They call themselves a progressive government. And they have been trying to enter into peace talks with some of these narco-trafficking outfits, but that has not worked.
And there are many studies and many people who believe that these groups have actually grown far more powerful. So the de facto state in some of these places is an armed group. So this policy hasn't really gone anywhere.
And how is this going over in the United States? Obviously, President Trump has made a big deal about the flow of drugs over the southern border.
you know, they're very focused on methamphetamines and fentanyl and so forth. The main focus has been Mexico and has been the border. And so we haven't seen them talk about cocaine. But of course, a big thing with the administration is to stop the flow of drugs into the United States. And cocaine remains a very important drug in the United States.
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