<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-820x547.jpg" alt="" class="wp-image-430859" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1124907100-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Charlie Munger, vice chairman of Berkshire Hathaway Inc., speaks during the Daily Journal Corp. shareholder meeting in Los Angeles, California, U.S., on Thursday, Feb. 14, 2019. Munger discussed investing, banks, China, and health care at the meeting. Photographer: Patrick T. Fallon/Bloomberg via Getty Images</figcaption></figure>



Billionaire Charlie Munger, the investing sage who made a fortune even before he became Warren Buffett’s right-hand man at Berkshire Hathaway, has died at age 99.



Munger died Tuesday, according to a press release from Berkshire Hathaway. The conglomerate said it was advised by members of Munger’s family that he peacefully died this morning at a California hospital. He would have turned 100 on New Year’s Day.



“Berkshire Hathaway could not have been built to its present status without Charlie’s inspiration, wisdom and participation,” Buffett said in a statement.



In addition to being Berkshire vice chairman, Munger was a real estate attorney, chairman and publisher of the Daily Journal Corp., a member of the Costco board, a philanthropist and an architect.



In early 2023, his fortune was estimated at $2.3 billion — a jaw-dropping amount for many people but vastly smaller than Buffett’s unfathomable fortune, which is estimated at more than $100 billion.



During Berkshire’s 2021 annual shareholder meeting, the then-97-year-old Munger apparently inadvertently revealed a well-guarded secret: that Vice Chairman Greg Abel “will keep the culture” after the Buffett era.



Munger, who wore thick glasses, had lost his left eye after complications from cataract surgery in 1980.



Munger was chairman and CEO of Wesco Financial from 1984 to 2011, when Buffett’s Berkshire purchased the remaining shares of the Pasadena, California-based insurance and investment company it did not own.



Buffett credited Munger with broadening his investment strategy from favoring troubled companies at low prices in hopes of getting a profit to focusing on higher-quality but underpriced companies.



An early example of the shift was illustrated in 1972 by Munger’s ability to persuade Buffett to sign off on Berkshire’s purchase of See’s Candies for $25 million even though the California candy maker had annual pretax earnings of only about $4 million. It has since produced more than $2 billion in sales for Berkshire<a href="https://finance.yahoo.com/news/learn-buffetts-sees-candies-deal-173114333.html" target="_blank" rel="noreferrer noopener">.</a>



“He weaned me away from the idea of buying very so-so companies at very cheap prices, knowing that there was some small profit in it, and looking for some really wonderful businesses that we could buy in fair prices,” Buffett told CNBC in May 2016.



Or as Munger put it at the 1998 Berkshire shareholder meeting: “It’s not that much fun to buy a business where you really hope this sucker liquidates before it goes broke.”



Munger was often the straight man to Buffett’s jovial commentaries. “I have nothing to add,” he would say after one of Buffett’s loquacious responses to questions at Berkshire annual meetings in Omaha, Nebraska. But like his friend and colleague, Munger was a font of wisdom in investing, and in life. And like one of his heroes, Benjamin Franklin, Munger’s insight didn’t lack humor.



“I have a friend who says the first rule of fishing is to fish where the fish are. The second rule of fishing is to never forget the first rule. We’ve gotten good at fishing where the fish are,” the then-93-year-old Munger told the thousands of people at Berkshire’s 2017 meeting.



He believed in what he called the “lollapalooza effect,” in which a confluence of factors merged to drive investment psychology.



<h2 class="wp-block-heading" id="h-a-son-of-the-heartland"><a></a>A son of the heartland</h2>



Charles Thomas Munger was born in Omaha on Jan. 1, 1924. His father, Alfred, was a lawyer, and his mother, Florence “Toody,”<a href="https://www.economist.com/media/globalexecutive/damn_right_e_02.pdf" target="_blank" rel="noreferrer noopener"> </a>was from an affluent family. Like Warren, Munger worked at Buffett’s grandfather’s grocery store as a youth, but the two future joined-at-the-hip partners didn’t meet until years later.



At 17, Munger left Omaha for the University of Michigan. Two years later, in 1943, he enlisted in the Army Air Corps, according to Janet Lowe’s 2003 biography “Damn Right!”



The military sent him to the California Institute of Technology in Pasadena to study meteorology. In California, he fell in love with his sister’s roommate at Scripps College, Nancy Huggins, and married her in 1945. Although he never completed his undergraduate degree, Munger graduated magna cum laude from Harvard Law School in 1948, and the couple moved back to California, where he practiced real estate law. He founded the law firm Munger, Tolles &amp; Olson in 1962 and focused on managing investments at the hedge fund Wheeler, Munger &amp; Co., which he also founded that year.



“I’m proud of being an Omaha boy,” Munger said in a 2017 interview with Dean Scott Derue of the Michigan Ross Business School. “I sometimes use the old saying, ‘They got the boy out of Omaha but they never got Omaha out of the boy.’ All those old-fashioned values — family comes first; be in a position so that you can help others when troubles come; prudent, sensible; moral duty to be reasonable [is] more important than anything else — more important than being rich, more important than being important — an absolute moral duty.”



In California, he partnered with Franklin Otis Booth, a member of the founding family of the Los Angeles Times, in real estate. One of their early developments turned out to be a lucrative condo project on Booth’s grandfather’s property in Pasadena. (Booth, who died in 2008, had been introduced to Buffett by Munger in 1963 and became one of Berkshire’s largest investors.)



“I had five real estate projects,” Munger told Derue. “I did both side by side for a few years, and in a very few years, I had $3 million — $4 million.”



Munger closed the hedge fund in 1975. Three years later, he became vice chairman of Berkshire Hathaway.



<h2 class="wp-block-heading" id="h-we-think-so-much-alike-that-it-s-spooky"><a></a>‘We think so much alike that it’s spooky’</h2>



In 1959, at age 35, Munger returned to Omaha to close his late father’s legal practice. That’s when he was introduced to the then-29-year-old Buffett by one of Buffett’s investor clients. The two hit it off and stayed in contact despite living half a continent away from each other.



“We think so much alike that it’s spooky,” Buffett recalled in an interview with the Omaha World-Herald in 1977. “He’s as smart and as high-grade a guy as I’ve ever run into.”



“We never had an argument in the entire time we’ve known each other, which is almost 60 years now,” Buffett told CNBC’s Becky Quick in 2018. “Charlie has given me the ultimate gift that a person can give to somebody else. He’s made me a better person than I would have otherwise been. &#8230; He’s given me a lot of good advice over time. &#8230; I’ve lived a better life because of Charlie.”



The melding of the minds focused on value investing, in which stocks are picked because their price appears to be undervalued based on the company’s long-term fundamentals.



“All intelligent investing is value investing — acquiring more than you are paying for,” Munger once said. “You must value the business in order to value the stock.”



But during the coronavirus outbreak in early 2020, when Berkshire suffered a massive $50 billion loss in the first quarter, Munger and Buffett were more conservative than they were during the Great Recession, when they invested in U.S. airlines and financials like Bank of America and Goldman Sachs hit hard by that downturn.



“Well, I would say basically we’re like the captain of a ship when the worst typhoon that’s ever happened comes,” Munger told The Wall Street Journal in April 2020. “We just want to get through the typhoon, and we’d rather come out of it with a whole lot of liquidity. We’re not playing, ‘Oh goody, goody, everything’s going to hell, let’s plunge 100% of the reserves’ [into buying businesses].” 



<h2 class="wp-block-heading"><a></a>The philanthropist/architect</h2>



Munger donated hundreds of millions of dollars to educational institutions, including the University of Michigan, Stanford University and Harvard Law School, often with the stipulation that the school accept his building designs, even though he was not formally trained as an architect.



At Los Angeles’ Harvard-Westlake prep school, where Munger had been a board member for decades, he ensured that the girls bathrooms were larger than the boys room during the construction of the science center in the 1990s.



“Any time you go to a football game or a function there’s a huge line outside the women’s bathroom. Who doesn’t know that they pee in a different way than the men?” Munger told The Wall Street Journal in 2019. “What kind of idiot would make the men’s bathroom and the women’s bathroom the same size? The answer is, a normal architect!”



Munger and his wife had three children, daughters Wendy and Molly, and son Teddy, who died of leukemia at age 9. The Mungers divorced in 1953.



Two years later, he married Nancy Barry, whom he met on a blind date at a chicken dinner restaurant. The couple had four children, Charles Jr., Emilie, Barry and Philip. He also was the stepfather to her two other sons, William Harold Borthwick and David Borthwick. The Mungers, who were married 54 years until her death in 2010, contributed $43.5 million to Stanford University to help build the Munger Graduate Residence, which houses 600 law and graduate students.



Asked by CNBC’s Quick in a February 2019 “Squawk Box” interview about the secret to a long and happy life, Munger said the answer “is easy, because it’s so simple.”



“You don’t have a lot of envy, you don’t have a lot of resentment, you don’t overspend your income, you stay cheerful in spite of your troubles. You deal with reliable people and you do what you’re supposed to do. And all these simple rules work so well to make your life better. And they’re so trite,” he said.



“And staying cheerful &#8230; because it’s a wise thing to do. Is that so hard? And can you be cheerful when you’re absolutely mired in deep hatred and resentment? Of course you can’t. So why would you take it on?”



— CNBC’s Yun Li contributed reporting.

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="405" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107332768-1699881235282-gettyimages-1775227723-SHEIN_IPO.jpeg" alt="" class="wp-image-430663" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107332768-1699881235282-gettyimages-1775227723-SHEIN_IPO.jpeg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107332768-1699881235282-gettyimages-1775227723-SHEIN_IPO-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107332768-1699881235282-gettyimages-1775227723-SHEIN_IPO-160x90.jpeg 160w" sizes="(max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">A Shein pop-up store inside a Forever 21 store in Times Square in New York on Nov. 10, 2023. Yuki Iwamura | Bloomberg | Getty Images</figcaption></figure>



Shein has confidentially filed to go public in the U.S. as the Chinese-founded fast-fashion juggernaut looks to expand its global reach with a long-rumored initial public offering, CNBC has learned.&nbsp;



The retailer was last valued at $66 billion and could be ready to start trading on the public markets as soon as 2024, people familiar with the matter said Monday.&nbsp;



It is unclear how much the company is currently worth, but its valuation has been a central point of debate among Shein and the advisors it’s working with, people familiar with the matter said.&nbsp;



A confidential filing is common, as it allows companies to communicate with the U.S. Securities and Exchange Commission and make any necessary adjustments to their filings in private. Over the next few months, Shein will likely make tweaks to its paperwork and answer numerous questions from the agency. The filing will be made public once the company is ready to move forward with its IPO. At that point, those communications with the SEC and any adjustments to its paperwork will be released as well.



Shein has been on a meteoric rise over the past few years after it won over consumers across the globe with its fashion-forward designs, endless assortment and dirt-cheap prices. But Shein has faced a series of challenges along the way and faced accusations of using forced labor in its supply chain, violating labor laws, harming the environment and stealing designs from independent artists.



The company is currently under investigation by the newly formed House Select Committee on the Chinese Communist Party and has faced scrutiny over its ties to Beijing. Numerous lawmakers, including 16 Republican attorneys general, have called on the SEC to ensure Shein isn’t using forced labor in its supply chain before it’s allowed to start trading in the U.S.



In October, Marcelo Claure, the company’s newly minted group vice chair and former SoftBank CEO, told CNBC in an interview that Shein is cooperating with lawmakers and taking time to meet with them to explain the business. He said, “there’s no such thing as forced labor” in the Shein factories that he has visited. But the company has repeatedly acknowledged that forced labor has been found in its supply chain and noted that it’s taking steps to fix it.



As Shein grew from an obscure Chinese retailer into a global behemoth with headquarters in Singapore, it largely stayed in the shadows. It said and did very little publicly until this year, when it began to open up in an apparent attempt to prepare for a U.S. IPO.



With Chinese CEO Sky Xu still at the helm, Shein tapped former Bear Stearns investment banker Donald Tang to be its executive chair and public face earlier this year.&nbsp;It has hosted a series of well-publicized pop-up events, sent influencers to its Chinese factories in a poorly received public relations campaign and courted the business press with splashy parties that featured its independent designers and other friends of the company.



Shein has worked hard to beat the many negative accusations that have come to define the company and has made its executives available for interviews as it worked to change the narrative.



Recently, it acquired about one-third of Sparc Group — a joint venture that includes brand management firm Authentic Brands Group and mall owner Simon Property Group — and in doing so, made a powerful U.S. ally that could help legitimize the company in the eyes of U.S. regulators.



As part of the deal, Shein has partnered up with former rival Forever 21 to unveil a co-branded clothing line that will see Shein design, manufacture and distribute the clothes primarily on its website. Shein has been hosting pop-up events inside of Forever 21′s stores.



Shein still has more work to do before it can win the trust of U.S. regulators. Beyond its myriad of issues, its CEO remains a mysterious figure who doesn’t give interviews or speak publicly about the company. The practice is a major departure from other firms that are publicly traded in the U.S., which regularly make their CEOs available. In October, the company did not tell CNBC whether Xu is still a Chinese citizen.



The company has tapped Goldman Sachs, JPMorgan and Morgan Stanley to be the lead underwriters on the offering, the people said. 



Shein declined to comment. Goldman Sachs, JPMorgan and Morgan Stanley did not comment.



Earlier Monday, Chinese media reported on Shein’s filing.

107332768-1699881235282-gettyimages-1775227723-SHEIN_IPO

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688-820x547.jpg" alt="" class="wp-image-429762" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-545175688.jpg 1024w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">PRETORIA, SOUTH AFRICA &#8211; JULY 6: Olympic athlete Oscar Pistorius holds the hand of a relative after sentencing at the High Court on July 6, 2016 at the High Court in Pretoria, South Africa. Pistorius was sentenced to six years in prison for the murder of girlfriend Reeva Steenkamp at their home in 2013. (Photo by Marco Longari &#8211; Pool/Getty Images)</figcaption></figure>



<a href="https://www.nbcnews.com/news/world/oscar-pistorius-murdered-girlfriend-reeva-steenkamp-father-parole-rcna36449" target="_blank" rel="noreferrer noopener">Oscar Pistorius</a>, the disgraced South African Paralympian who&nbsp;<a href="https://www.nbcnews.com/news/world/blade-runner-oscar-pistorius-charged-murder-flna1c8371215" target="_blank" rel="noreferrer noopener">murdered his girlfriend</a>&nbsp;on Valentine’s Day 10 years ago, was granted parole at a hearing on Friday and will be released.



A double amputee sprinter known as the “Blade Runner” for his prosthetic legs, Pistorius, 37, was convicted of fatally shooting his girlfriend Reeva Steenkamp&nbsp;<a href="https://www.nbcnews.com/storyline/pistorius-trial/pistorius-i-knew-it-id-fired-four-shots-door-n74446" target="_blank" rel="noreferrer noopener">four times through a locked bathroom door</a>&nbsp;at his home in Pretoria in 2013.



Pistorius was told at a hearing in Pretoria, the administrative capital where he has been held, that he will be released on Jan. 5, 2024.



A model and law graduate, Steenkamp was 29. Tania Koen, a lawyer who has represented the Steenkamps throughout the parole process and Pistorius’ appeals, confirmed to NBC News that parole was granted.



Pistorius was <a href="https://www.nbcnews.com/news/world/oscar-pistorius-denied-parole-murder-reeva-steenkamp-rcna77550" target="_blank" rel="noreferrer noopener">denied parole at a hearing in March</a> after a judge ruled that, despite expectations that it would be granted, he had not served the minimum time needed to qualify for parole. The judge in that hearing said he wouldn’t be considered for parole until August 2024.



The 2014 trial attracted global attention as the&nbsp;<a href="https://www.nbcnews.com/storyline/pistorius-trial/pistorius-vomits-court-graphic-images-steenkamps-body-n51591" target="_blank" rel="noreferrer noopener">details of Steenkamp’s death</a>&nbsp;were beamed around the world. It immediately ended the career of Pistorius, then perhaps the world’s most high-profile disabled athlete, who made history by competing in an able-bodied field at the Olympics.&nbsp;&nbsp;



Pistorius claimed<a href="https://www.nbcnews.com/storyline/pistorius-trial/oscar-pistorius-my-car-was-shot-dad-was-hijacked-twice-n73506" target="_blank" rel="noreferrer noopener">&nbsp;he mistook Steenkamp for a burglar</a>&nbsp;and shot her in error. As a condition of the parole process,&nbsp;<a href="https://www.nbcnews.com/news/world/oscar-pistorius-murdered-girlfriend-reeva-steenkamp-father-parole-rcna36449" target="_blank" rel="noreferrer noopener">Pistorius met with Steenkamp’s father</a>, Barry, in June 2022. Her family opposed his release because they reject Pistorius’ account of their daughter’s killing.



As Pistorius has not yet served his full sentence of 13 years and five months, he will likely be forced to wear an electronic security tag and be banned from leaving Gauteng Province, which includes Johannesburg and Pretoria.



Originally, Pistorius was sentenced to six years in jail for murder, but prosecutors then appealed what they called a “<a href="https://www.nbcnews.com/storyline/pistorius-trial/oscar-pistorius-prosecutors-seek-longer-murder-sentence-n817166" target="_blank" rel="noreferrer noopener">shockingly lenient</a>” punishment and the sentence was increased.



Born with a congenital condition that led to both his legs being amputated below the knee when he was 11 months old, Pistorius became a successful athlete, leading out the South African team at the 2012 London Olympics opening ceremony. Days later he would become the first double amputee to compete at the Olympics.



The 2014 trial&nbsp;<a href="https://www.nbcnews.com/storyline/pistorius-trial/oscar-pistorius-kept-gun-him-all-time-ex-girlfriend-n46746" target="_blank" rel="noreferrer noopener">heard&nbsp;</a>that Pistorius had a gun with him “all the time,” including on his bedside table while he slept. He told the court that he lived in fear of a home invasion and said he had been&nbsp;<a href="https://www.nbcnews.com/storyline/pistorius-trial/oscar-pistorius-my-car-was-shot-dad-was-hijacked-twice-n73506" target="_blank" rel="noreferrer noopener">followed, shot at and hi-jacked</a>. When he shot Steenkamp he had assumed it was a burglar, he said.&nbsp;

Oscar Pistorius Is Sentenced In The Trial Over The Murder Of Reeva Steenkamp

Oscar Pistorius granted parole, to be released from prison nearly 11 years after murdering girlfriend Reeva Steenkamp

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi-820x462.jpeg" alt="" class="wp-image-429701" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337160-1700574941108-gettyimages-1442524552-pd21gi.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Coal plays a huge role in global electricity generation, but has a significant impact on the environment. Boy_anupong | Moment | Getty Images</figcaption></figure>



From Pennsylvania to the north of England, coal mines helped to power the Industrial Revolution, turbocharging the economic growth of countries around the world.



Today, however, the production and use of coal has become a thorny issue, with critics slamming the fossil fuel’s huge impact on the environment.



Organizations like Greenpeace describe coal as “the dirtiest, most polluting way of producing energy.” From the UN Secretary General to the International Energy Agency, talk of phasing out coal is becoming increasingly common.



But the global picture is a complex one. A multitude of factors are in play, not least the desire of some countries, especially those in emerging markets, to use coal as a tool for their own economic development.



As the debate surrounding coal continues, discussions about using it — and the infrastructure linked to it — in the shift to a more sustainable future have become one of the more paradoxical aspects of the energy transition.



In May, U.S. firm Ramaco Resources offered some insight into how coal may have a role to play in the years ahead.



Together with researchers from mining consultancy Weir International and the U.S. Department of Energy’s National Energy Technology Laboratory, it published an independent report containing a technical assessment of rare earth elements, or REE, found at one of its mines in Wyoming.



The findings appear to be significant. “Following eighteen months of extensive core drilling and independent chemical analysis, NETL researchers and Ramaco now believe that the Brook Mine property contains perhaps the largest unconventional deposit of REEs discovered in the United States,” Ramaco said.



Speaking to CNBC’s Kelly Evans on “The Exchange” earlier this month, Ramaco CEO Randall Atkins explained why his firm had bought the site in the first place, and how its plans had changed over time.



“It was a rather large reserve, extremely reasonably priced, and we thought we might make a go of it just as a thermal coal proposition but you know, the world changed rather quickly about 10 years ago,” he said.



“And the idea of deploying capital towards a thermal mine became very unattractive. So our approach was, basically, ‘what else can we do with this stuff?’”



This led the company to “a 10 year odyssey of discovering a variety of other alternative uses of coal.”



With China dominating the supply and refining of rare earths, discoveries like the one in Wyoming could be strategically pivotal as the race to roll out the technologies of tomorrow heats up.



“The majority of REE deposits outside of China are associated with ‘conventional’ mines and found in igneous hard rock deposits, which makes them both difficult and expensive to mine and process,” Ramaco said.



“In contrast, the REEs from the Brook Mine are characterized as “unconventional” because they are largely found in clay strata located above and below the coal seams themselves,” it added.



“It is expected they can be mined using normal surface mining techniques and processed in a more economic and environmental manner than conventional REE mines.”



<h2 class="wp-block-heading" id="h-a-glimmer-of-hope"><a></a>A glimmer of hope?</h2>



Wyoming is not the only part of the U.S. where coal and rare earth extraction are being looked at. In April, for instance, West Virginia University said its researchers would receive an $8 million grant from the U.S. Department of Energy.



The funding would allow them to carry on with the development and advancement of a “pioneering method to extract and separate rare earth elements and critical minerals from acid mine drainage and coal waste,” it added.



Elsewhere, researchers at Penn State have also been focusing on ways to source rare earths and critical minerals via waste from coal mines.



Across the Atlantic, efforts to repurpose old coal mines so that they can be used for many more years to come have also been taking shape.



In Scotland, researchers have been looking at how the water that’s flooded old, disused mines can be used to provide decarbonized heating to buildings.



Away from coal, other sources of energy also hold potential when it comes to producing by-products crucial to sustainable technologies like EV batteries.



In the southwest of England, Geothermal Engineering Limited recently said lithium would be produced as a by-product of its projects focused on geothermal power generation.



According to the firm, it will be enough lithium to supply roughly 250,000 electric car batteries per year.



“GEL’s primary geothermal business of providing baseload geothermal electricity and heat produces a naturally hot geothermal brine from which lithium can be sustainably extracted onshore in the UK as a by-product,” it said.



Despite promising developments like the ones above, the fact remains that coal continues to play a huge role in electricity generation, accounting for a little over one third globally, according to the IEA.



Nevertheless, finds like the one in Wyoming represent a faint glimmer of hope.



Asked by CNBC if there was the potential for more discoveries of a similar ilk, Ramaco CEO Randall Atkins appeared cautiously optimistic. “I think it’s probably logical to conclude that there would be,” he said.

107337160-1700574941108-gettyimages-1442524552-pd21gi

Rare earth discoveries mean coal mines could have a key role to play in the energy transition

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-820x461.jpeg" alt="" class="wp-image-429467" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337930-1700665715409-gettyimages-1258459514-AFP_33GZ4VK.jpeg 1920w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Sam Altman (L), US entrepreneur, investor, programmer, and founder and CEO of artificial intelligence company OpenAI, and the company’s co-founder and chief scientist Ilya Sutskever, speak together at Tel Aviv University in Tel Aviv on June 5, 2023. Jack Guez | Afp | Getty Images</figcaption></figure>



After several days of crisis and tumult, Sam Altman has returned as the CEO of OpenAI. Three new board members have replaced the previous leadership that ousted Altman.



OpenAI’s new board doesn’t appear to be fully built. Negotiations are reportedly underway to install representation from Microsoft, which has invested billions of dollars in OpenAI, or other major investors.



There’s a notable change in the board’s experience. The previous board included academics and researchers, but OpenAI’s new directors have extensive backgrounds in business and technology.



Microsoft CEO Satya Nadella said in an interview with CNBC on Monday that governance at OpenAI needed to change. Nadella said Wednesday he is “encouraged” by the changes to the company’s board, according to a post on X, formerly known as Twitter.



“We believe this is a first essential step on a path to more stable, well-informed, and effective governance,” he said.



Microsoft, Sequoia Capital, Thrive Capital and Tiger Global are among the OpenAI investors that lack representation on the board but had been pushing to reinstate Altman, as CNBC previously reported.



Here’s who’s in, who’s out, and what the changes may mean.



<h2 class="wp-block-heading"><a></a>Here are the newest members of OpenAI’s board</h2>



<h3 class="wp-block-heading" id="h-bret-taylor-board-chair">Bret Taylor, board chair</h3>



Bret Taylor is currently a board member at the e-commerce platform Shopify. He’s also the former co-CEO of Salesforce and was Twitter’s final board chair prior to Elon Musk’s acquisition of the social media platform.



Taylor co-founded Quip, a collaboration platform that was acquired by Salesforce in 2016. That acquisition propelled him into the most senior ranks of the enterprise software company, where he would eventually take the co-CEO title in 2021. Taylor left Salesforce in January.



The executive launched his own artificial intelligence venture alongside a former Google executive in February. It isn’t clear whether Taylor’s involvement with his own AI startup will cease with his appointment to lead OpenAI’s board. 



Taylor did not immediately respond to CNBC’s request for comment.



<h3 class="wp-block-heading">Larry Summers</h3>



Larry Summers served as Treasury secretary during the Clinton administration and was the president of Harvard University. An economist by training, Summers also led the Obama administration’s National Economic Council during the Global Financial Crisis.&nbsp;



His connections in Washington could be valuable for OpenAI as the company faces continued regulatory scrutiny from lawmakers.&nbsp;



In December, Summers called OpenAI’s popular generative chatbot ChatGPT a “profound thing for humanity” during an interview with Bloomberg. He compared the advent of the technology to the introduction of the printing press and electricity. 



“This could be the most important general-purpose technology since the wheel or fire,” Summers said.&nbsp;



Summers also serves on the board of Block, a financial technology company led by Twitter co-founder Jack Dorsey, and on the board of Skillsoft, an educational technology company. 



Summers stepped down in 2006 from Harvard’s presidency following backlash on campus about comments he made on gender representation in STEM fields at a diversity conference. Summers later apologized for the remarks, saying in a 2005 letter that he was “wrong to have spoken in a way that has resulted in an unintended signal of discouragement to talented girls and women.”



A representative for Summers declined to comment.



<h3 class="wp-block-heading">Adam D’Angelo</h3>



Adam D’Angelo is the only member of OpenAI’s previous board who still holds a seat. He joined in 2018 and reportedly played a major role in the negotiations that brought Altman back to the helm. 



D’Angelo is the CEO of Quora, a platform where users can publicly ask and answer questions. He is also developing an AI chat platform called Poe, which he announced in February. He spent several years at Meta, formerly known as Facebook, and served as CTO from 2006 to 2008.



He has not commented publicly since Altman’s ouster Friday, but he retweeted a post on X that suggested his motives were not “crazy” or “vindictive.” OpenAI’s board fired Altman on Friday after determining he was “not consistently candid in his communications,” but its members never elaborated further.&nbsp;



D’Angelo did not immediately respond to CNBC’s request for comment.



<h2 class="wp-block-heading">Here’s who’s no longer on OpenAI’s board </h2>



<h3 class="wp-block-heading">Helen Toner</h3>



Helen Toner is a researcher and director of strategy and foundational research grants at Georgetown University’s Center for Security and Emerging Technology. Toner was a former employee at Open Philanthropy, serving as an advisor on AI policy.&nbsp;



Toner offered what could be seen as public criticism of OpenAI in an October paper, a decision with which Altman reportedly took issue. The paper suggested that OpenAI’s launch of ChatGPT undermined the company’s efforts to develop AI safely, by spurring other tech companies into launching their own competing chatbots and forcing them to “accelerate or circumvent internal safety and ethics review processes.”



She was one of the directors involved in pushing Altman out. She has not responded to CNBC’s previous attempts to contact her.



<h3 class="wp-block-heading">Tasha McCauley</h3>



Tasha McCauley joined OpenAI’s board in 2018. She is an adjunct senior management scientist at Rand Corporation, and formerly served as the CEO of GeoSim Systems, which developed an automated city modeling system.&nbsp;



She is married to actor and filmmaker Joseph Gordon-Levitt, who announced the union in 2015. 



McCauley has not commented publicly since Altman’s firing Friday. She did not respond to CNBC’s requests for comment. 



<h3 class="wp-block-heading">Ilya Sutskever</h3>



Ilya Sutskever co-founded OpenAI and serves as its chief scientist. He also aligned himself, for a time, with the board members who ousted Altman.



Sutskever is the author or co-author of more than 130 research papers on artificial intelligence, neural networks, and generative AI, according to his Google Scholar profile. He holds a Ph.D. in computer science from the University of Toronto and had a brief post-doctoral stint at Stanford, according to his LinkedIn profile.



Sutskever co-led OpenAI alongside president Greg Brockman, an idea that Altman at the time described as “non-traditional.” Sutskever is close with Brockman and officiated his wedding at OpenAI headquarters in 2019. 



A personal plea from Brockman’s wife reportedly helped bring Sutskever back into Altman’s camp. Sutskever was one of the first signatories on a letter signed by the vast majority of OpenAI employees that demanded the board’s resignation over the weekend. He repudiated his support for the board in a post on X.



Despite his about-face, Sutskever was removed from the board. His status as an OpenAI executive does not appear to have changed.



<h2 class="wp-block-heading">What’s next?</h2>



Semafor reported that Altman had been pushing for months to add more directors at OpenAI, and reports suggest it’s unlikely that OpenAI’s board will remain this small.



Bloomberg said Thursday that among the changes Microsoft wanted was a larger and more experienced board. The board is currently smaller, and it’s unclear what, if any, kind of other protections or role on the board Microsoft might get.



The composition of the new board — experienced technology and business executives — suggests that OpenAI may be transforming into a more conventional Silicon Valley startup on paper, not just in spirit.



The new governance, however, does not change the fact that OpenAI remains a “capped-profit” entity owned by a nonprofit, with excess profits continuing to flow up to that nonprofit.&nbsp;

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Sam Altman’s back. Here’s who’s on the new OpenAI board and who’s out

Why the fashion industry underwent merger mania in 2023 #Shorts

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-820x461.jpeg" alt="" class="wp-image-429232" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107327233-16988648212023-11-01t185128z_685341700_rc2i44a4cb6s_rtrmadp_0_usa-economy-fed.jpeg 1920w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Federal Reserve officials at their most recent meeting expressed little appetite for cutting interest rates anytime soon, particularly as inflation remains well above their goal, according to minutes released Tuesday.&nbsp;



The summary of the meeting, held Oct. 31-Nov. 1, showed that Federal Open Market Committee members still worry that inflation could be stubborn or move higher, and that more may need to be done.



At the least, they said policy will need to stay “restrictive” until data shows inflation on a convincing trek back to the central bank’s 2% goal.



“In discussing the policy outlook, participants continued to judge that it was critical that the stance of monetary policy be kept sufficiently restrictive to return inflation to the Committee’s 2 percent objective over time,” the minutes said.



Along with that, however, the minutes showed that members believe they can move “proceed carefully” and make decisions “on the totality of incoming information and its implications for the economic outlook as well as the balance of risks.”



The release comes amid overwhelming sentiment on Wall Street that the Fed is done hiking.



Traders in the fed funds futures market are indicating virtually no probability that policymakers will increase rates again this cycle, and in fact are pricing in cuts starting in May. Ultimately, the market expects that the Fed will enact the equivalent of four quarter percentage point cuts before the end of 2024.



<h2 class="wp-block-heading" id="h-no-mention-of-cuts"><a></a>No mention of cuts</h2>



However, the minutes gave no indication that members even discussed when they might start lowering rates, which was reflected in Chairman Jerome Powell’s post-meeting news conference.



“The fact is, the Committee is not thinking about rate cuts right now at all,” Powell said then.



The fed’s benchmark funds rate, which sets short-term borrowing costs, is currently targeted in a range between 5.25%-5.5%, the highest level in 22 years.



The meeting occurred amid market worries over rising Treasury yields, a topic that appeared to generate substantial discussion during the meeting. The same day, Nov. 1, when the Fed released its post-meeting statement, the Treasury Department announced its borrowing needs over the next few months, which actually were a bit smaller than markets had anticipated.



Since the meeting, yields have receded off 16-year highs as markets digest the impact of heavy debt-fueled borrowing from the government and views over where the Fed is headed with rates.



Officials concluded that the rise in yields had been fueled by rising “term premiums,” or the extra yield investors demanded to hold longer-term securities. The minutes noted that policymakers viewed the rising term premium as a product of greater supply as the government finances its huge budget deficits. Other issues included the Fed’s stance on monetary policy and views on inflation and growth.



“However, they also noted that, whatever the source of the rise in longer-term yields, persistent changes in financial conditions could have implications for the path of monetary policy and that it would therefore be important to continue to monitor market developments closely,” the minutes said.



<h2 class="wp-block-heading">Economic growth to slow</h2>



In other business, officials said they expect economic growth in the fourth quarter to “slow markedly” from the 4.9% increase in Q3 gross domestic product. They said that risks to broader economic growth are probably skewed to the downside, while risks to inflation are to the upside.



As for current policy, members said it “was restrictive and was putting downward pressure on economic activity and inflation,” the minutes said.



Public remarks from Fed officials have been split between those who think the central bank can hold here while it weighs the impact that its previous 11 hikes, totaling 5.25 percentage points, have had on the economy, and those who believe more increases are warranted.



Economic data also has been split, though generally favorable for inflation trends.



The Fed’s key inflation indicator, the personal consumption expenditures price index, showed core inflation running at a 3.7% 12-month pace in September. The number has improved considerably, dropping a full percentage point since May, but is still well above the Fed’s target.



Some economists think getting inflation down from here could be tricky, particularly with wage increases running strong and more stubborn components such as rent and medical care elevated. Indeed, so-called sticky prices rose 4.9% over the past year, according to an Atlanta Fed gauge.



On employment, perhaps the most critical factor in getting inflation lower, the jobs market is strong though moderating. Nonfarm payrolls increased by 150,000 in October, one of the slowest months of the recovery, though the unemployment rate has climbed to 3.9%. The half percentage point increase of the jobless rate, if it persists, is commonly associated with recessions.



Economic growth, after a robust first three quarters in 2023, is expected to slow considerably. The Atlanta Fed’s GDPNow tracker is pointing to growth of 2% in the fourth quarter.

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Fed gave no indication of possible rate cuts at last meeting, minutes show

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct-820x462.jpeg" alt="" class="wp-image-429215" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107329709-1699300428591-gettyimages-1778705142-js1_7704_kzlz5hct.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">OpenAI CEO Sam Altman speaks during the OpenAI DevDay event on November 06, 2023 in San Francisco, California.  Justin Sullivan | Getty Images</figcaption></figure>



Sam Altman will return as CEO of OpenAI, the startup said early Wednesday morning on X, formerly known as Twitter. The move follows immense pressure from employees and investors on the board that ousted him less than a week ago.



Former Salesforce co-CEO Bret Taylor and former Treasury Secretary Larry Summers will join OpenAI’s board, the Microsoft-backed startup said, with Taylor holding the chair position. Adam D’Angelo, co-founder and CEO of question-and-answer startup Quora, will remain on the board.



“We are collaborating to figure out the details. Thank you so much for your patience through this,” OpenAI said in the X post.



On Monday, hundreds of employees, including co-founder and board member Ilya Sutskever, signed a letter saying that, if the board didn’t resign and bring Altman back, the overwhelming majority would move to work with him at Microsoft.



Satya Nadella, Microsoft’s CEO, said in an X post on Monday that Altman and his co-founder Greg Brockman would join Microsoft to form a new AI lab.



That followed an announcement late Sunday that OpenAI had hired ex-Twitch CEO Emmett Shear as Altman’s interim replacement. Originally, the board had said OpenAI technology chief Mira Murati would assume that role, but she soon joined the parade of employees calling for Altman’s return.



“with the new board and w satya’s support, i’m looking forward to returning to openai, and building on our strong partnership with msft,” Altman wrote in a post of his own on X.



Nadella applauded changes OpenAI has made to its board in his X post.



“We believe this is a first essential step on a path to more stable, well-informed, and effective governance,” Nadella wrote. “Sam, Greg, and I have talked and agreed they have a key role to play along with the OAI leadership team in ensuring OAI continues to thrive and build on its mission. We look forward to building on our strong partnership and delivering the value of this next generation of AI to our customers and partners.”



The rapid reinstatement of Altman began to look like a possibility on Saturday as news surfaced that a group of prominent investors, including Microsoft, Tiger Global, Thrive Capital and Sequoia Capital were working to reverse the board’s decision from a day earlier. None of those firms had board seats, and they were caught unaware by the decision.



In a post on X late Saturday night, Altman wrote, “i love the openai team so much.” Brockman, who quit the company after the board removed him as chairman alongside the ouster of Altman, reposted the comment with a heart symbol. Other OpenAI employees did the same.



OpenAI, which was reportedly in talks as recently as last month to sell employee shares to investors at an $86 billion valuation, emerged as the hottest startup on the planet this year after releasing its ChatGPT chatbot in late 2022. ChatGPT allows users to input simple text queries and retrieve smart and creative answers that can lead to more in-depth conversations.



Altman had been leading the company since 2019 and was serving as both the top executive of a high-flying company and the public face of artificial intelligence research and product development.



Unlike most Silicon Valley startups, OpenAI wasn’t structured like a typical corporation with large chunks of equity controlled by the founders. Rather, it was part of a nonprofit that was started in 2015. The board oversees the nonprofit, which “acts as the overall governing body for all OpenAI activities,” according to Friday’s blog post.



Sutskever and Brockman were both part of OpenAI’s founding team. Original investors included Altman, LinkedIn co-founder Reid Hoffman and Tesla CEO Elon Musk, who reportedly committed $1 billion to the project.



“Returning to OpenAI &amp; getting back to coding tonight,” Brockman wrote in an early Wednesday X post.



Immediately after OpenAI’s board announced Altman’s firing, prominent Silicon Valley investors and founders loudly voiced their concerns and even compared the move to Apple’s decision 38 years ago to fire Steve Jobs. In 1997, Jobs would return and eventually lead Apple to create the iPhone and become the most valuable company in the U.S.



“What happened at OpenAI today is a Board coup that we have not seen the likes of since 1985 when the then-Apple board pushed out Steve Jobs,” longtime startup investor Ron Conway said in an X post. “It is shocking; it is irresponsible; and it does not do right by Sam &amp; Greg or all the builders in OpenAI.”



Former Google CEO Eric Schmidt called Altman a “hero of mine,” who built a company that “changed our collective world forever.” Airbnb CEO Brian Chesky described Altman as “one of the best founders of his generation.” And venture capitalist Vinod Khosla said he is a “once in a generation CEO.”



Nadella, who made a surprise appearance earlier this month at OpenAI’s developer conference, was reportedly surprised and upset by the announcement. His company has invested billions of dollars in OpenAI and is a close technology partner, hosting hefty GPT workloads on its Azure cloud infrastructure.



“This was the pathway that maximized safety alongside doing right by all stakeholders involved,” Shear said in an early Wednesday X post. “I’m glad to have been a part of the solution.”

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OpenAI brings Sam Altman back as CEO less than a week after he was fired by board

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-820x547.jpeg" alt="" class="wp-image-429211" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107337316-1700585872532-gettyimages-1239957235-FRANCE_BLOCKCHAIN-scaled.jpeg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Zhao Changpeng, founder and chief executive officer of Binance, speaks at the Blockchain Week Summit in Paris, France, on Wednesday, April 13, 2022.  Benjamin Girette | Bloomberg | Getty Images</figcaption></figure>



Binance chief Changpeng Zhao pleaded guilty Tuesday to criminal charges and stepped down as the company’s CEO as part of a $4.3 billion settlement with the Department of Justice, according to court documents. The plea arrangement with the government resolves a multiyear investigation into the world’s largest cryptocurrency exchange.



Zhao appeared before Judge Brian Tsuchida in a Seattle courtroom to enter his plea. Zhao and others were charged with violating the Bank Secrecy Act by failing to implement an effective anti-money-laundering program and for willfully violating U.S. economic sanctions “in a deliberate and calculated effort to profit from the U.S. market without implementing controls required by U.S. law,” according to the Justice Department.



Zhao said Tuesday in a post on X, formerly Twitter, that he had “made mistakes” and “must take responsibility.” He said Richard Teng, the company’s former global head of regional markets, has been named the new CEO of Binance.



The action against Binance and its founder was a joint effort by the Department of Justice, the Commodity Futures Trading Commission and the Treasury Department. The Securities and Exchange Commission was notably absent.



Treasury Secretary Janet Yellen said in a release Tuesday that the exchange allowed illicit actors to make more than 100,000 transactions that supported activities such as terrorism and illegal narcotics and that it allowed more than 1.5 million virtual currency trades that violated U.S. sanctions.



It also allowed transactions associated with terrorist groups such as Hamas’ Al-Qassam Brigades, Palestinian Islamic Jihad, al-Qaida and ISIS, Yellen said in the release, noting Binance “never filed a single suspicious activity report.”



U.S. Attorney General Merrick Garland said in a press conference Tuesday that the fine is “one of the largest penalties we have ever obtained.”



“Using new technology to break the law does not make you a disruptor. It makes you a criminal,” Garland said.



“Binance prioritized its profits over the safety of the American people,” he said.



According to a 92-page consent order between Binance and Treasury’s Financial Crimes Enforcement Network, or FinCen, the crypto exchange “even developed a process to notify VIP users if they became the subject of a law enforcement inquiry.”



Zhao personally pleaded guilty to violating and causing a financial institution to violate the Bank Secrecy Act, according to the plea agreement. The DOJ is also recommending that the court impose a $50 million fine on Zhao.



Zhao has been released on a $175 million personal recognizance bond secured by $15 million in cash and has a sentencing hearing scheduled for Feb. 23.



Binance will continue to operate but with new ground rules. The company will be required to maintain and enhance its compliance program to ensure its business is in line with U.S. anti-money-laundering standards. The company is required to appoint an independent compliance monitor.



The case against Binance, which was unsealed Tuesday, shows that three criminal charges were brought against the exchange, including conducting an unlicensed money-transmitting business, violating the International Emergency Economic Powers Act, and conspiracy.



Binance has agreed to forfeit $2.5 billion to the government, as well as to pay a fine of $1.8 billion.



The Justice Department said in its filing Tuesday that Binance “knowingly and willfully” caused the supply of services to Iran, in breach of U.S. sanctions. It follows a report that Binance processed billions of dollars worth of Iranian transactions.



“Let me be clear: We are also sending a message to the virtual currency industry more broadly, today and for the future,” Yellen wrote in a press brief.



The settlement comes after FTX founder Sam Bankman-Fried was found guilty of several criminal counts of fraud and conspiracy on Nov. 2 following just three hours of deliberation by the jury. Experts told CNBC that, for a high-profile monthlong trial that involved nearly 20 witnesses and hundreds of exhibits, they’d never seen such a speedy decision.



CNBC reached out to Zhao for comment but did not immediately hear back. Binance did not respond to several CNBC requests for comment.



The charges follow civil suits brought earlier this year by both the Securities and Exchange Commission and the Commodity Futures Trading Commission.



Binance has been the center of intense regulatory scrutiny over how it operates, with officials in multiple jurisdictions flagging concerns about the company’s approach toward launching in certain markets even when it lacks the authority to do so, and allegations of involvement in illicit dealings such as money laundering and securities fraud.



The SEC targeted the company with an expansive lawsuit in June, alleging that Binance was running an illegal securities exchange and mishandling customer funds.



The SEC hit rival exchange Coinbase with a similar lawsuit shortly after, alleging it is operating as an unauthorized securities exchange, broker and clearing agency.



And on Monday the SEC sued Kraken, alleging that the exchange commingled $33 billion in customer crypto assets with its own company assets, creating the potential for a significant risk of loss to its users.



In the 13 charges brought against Binance by the SEC, the agency accused Binance of commingling billions of dollars in customer money with Binance’s own funds, similar to allegations made against the now-bankrupt crypto exchange FTX. SEC Chair Gary Gensler added, “Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.”



Started by the Chinese-born entrepreneur in 2017, Binance went from being a relatively obscure name to being a major force in crypto in a matter of weeks. Binance remains the world’s largest crypto exchange globally, processing billions of dollars in trading volume every year.



While its holding company is based in the Cayman Islands, Binance doesn’t have a global headquarters and Zhao frequently resisted calls to create one, saying he wanted the platform to run on a “decentralized” operating model.



In 2021, the U.K.’s Financial Conduct Authority barred Binance’s U.K. unit from operating in the country, saying it wasn’t authorized to carry out regulated activities. More recently, Binance scrapped plans to pursue a full U.K. license after the regulator said its know-your-customer and anti-money-laundering controls didn’t meet its requirements.



In the CFTC’s complaint, the regulator alleged that Binance, Zhao, and the company’s ex-chief compliance officer, Samuel Lim, operated an “illegal” exchange, ran a “sham” compliance program, and violated the Commodity Exchange Act, including laws “designed to prevent and detect money laundering and terrorism financing.”



Binance and Zhao filed a motion in July to dismiss the CFTC’s suit. The U.S. arm of the exchange is also pushing back on the SEC’s lawsuit, filing a protective order against what they call the SEC’s “fishing expedition.”



Of particular concern for the crypto industry are the implications of the agency’s crackdown on crypto for myriad tokens and blockchains — not just the exchanges. The SEC maintains that several of the tokens Binance and Coinbase offer on their platforms — such as Solana’s sol, Cardano’s ada, and Polygon’s matic — are securities that should have been registered with the agency.



— CNBC’s Kevin Breuninger contributed to this report.

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Binance CEO Changpeng Zhao pleads guilty to federal charges, steps down

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX-820x462.jpeg" alt="" class="wp-image-429199" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/107336684-1700507290931-gettyimages-1793715520-AFP_34474FX.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Israeli soldiers transfer detained Palestinians out of the Gaza Strip on November 20, 2023, as battles between Israel and the Hamas movement continue. Gil Cohen-magen | AFP | Getty Images</figcaption></figure>



Geopolitical risks will be the key threat to the economic outlook for 2024, as large-scale wars converge with a slew of pivotal elections across major global powers.



As the world’s financial institutions map out the investment landscape for next year, they expect an increasingly fraught geopolitical backdrop and greater divergence across key regions, compounding uncertainty and market volatility.



In a global risk survey carried out among 130 businesses last month by Oxford Economics, almost two fifths of respondents viewed the Israel-Hamas war as a very significant risk to the global economy over the next two years.



Yet worries over relations between China and Taiwan and Russia and NATO were similarly widespread, and geopolitical tensions were the top business concern over both the near and medium term, with 62% of businesses citing geopolitics as a very significant risk to the global economy.



“Deglobalisation and persistently higher oil prices, both of which could be triggered by an intensification of geopolitical tensions, are also fairly prominent in the latest survey,” Oxford Economics researchers said.



The International Monetary Fund expects global growth to slow to 2.9% in 2024, amid widening divergence between regions — stronger growth is projected in the U.S. and large emerging markets, while China and the euro area are expected to struggle.



In its 2024 investment outlook published Monday, Goldman Sachs Asset Management noted that elections in the U.S., U.K., South Africa, India, Taiwan and Russia will add to the range of possibilities for the global economy to diverge from its current path.



The Wall Street giant’s asset management arm noted that concerns over government debt sustainability and the fiscal trajectory in the U.S. may mount in the run-up to the presidential election of next November, while domestic socioeconomic risks — such as strikes in certain industries amid stubbornly high inflation — could persist across major economies and further weigh on growth.



“Rising geopolitical tensions could trigger more trade restrictions across the globe, resulting in further economic fragmentation. We expect economies to continue to invest heavily in their economic security over the next 12 months and beyond,” GSAM strategists wrote.



“This may be driven by developed markets ‘re-shoring’ and ‘friend-shoring’ critical supply chains that remain highly interdependent and, in some cases, over-concentrated, such as leading-edge semiconductors.”



<h3 class="wp-block-heading" id="h-russia-ukraine-israel-hamas-china-taiwan">Russia-Ukraine, Israel-Hamas, China-Taiwan</h3>



The view was echoed by Ronald Temple, chief market strategist at Lazard, who said in a global outlook report last week that, while predicting the course of any single geopolitical crisis is fraught, what is clear is that “the global trajectory is toward more frequent conflicts of increasing consequence.”



“Navigating the evolving — at times treacherous — geopolitical landscape will likely require access to deep wells of expertise, as geopolitical issues that could have been ignored in the past now stand to directly impact companies’ supply chains and customer bases,” Temple said.



“Ongoing geopolitical conflicts and tensions are likely to depress growth further, while adding to inflationary pressures that are beyond the control of central banks.”



Temple predicted that the Russia-Ukraine conflict will extend well into 2024, as the Ukrainian counteroffensive loses momentum due to the encroaching winter, while concerns mount over the reliability of Western funding and military aid.



“While a negotiated settlement is likely the only way to end the war, both sides remain far from the point of agreeing to capitulate on their grand designs — that is, for Russia to control all of Ukraine and for Ukraine to control all of its sovereign territory,” he said.



As for the Middle East, the most “combustible situation” would be a spill-over of the Israel-Hamas conflict into nearby states, including Iran, which could “spiral into a regional conflict with global and military implications.” The primary risk of this form of escalation would be a disruption of the transit of energy supplies through the Strait of Hormuz, through which around 20% of global oil supply is shipped.



But Temple argued that all parties, including Iran, Israel and the United States have strong incentives to avoid this outcome, and that the most economically consequential geopolitical situation is China’s multi-faceted tensions with the West over competition and Taiwan.



“Early 2024 Taiwan elections will set the stage for the rest of the year. The Democratic Progressive Party (DPP) is currently well ahead of the more Beijing-friendly Kuomintang (KMT),” he noted.



“A DPP victory would likely escalate tension with Beijing as the DPP is seen as favoring a formal declaration of independence, a red line for the Chinese government.”



A clear result of both direct industrial competition between China and the U.S. and concerns over China’s intentions in Taiwan is growing supply chain fragmentation, as trade tariffs and barriers along with post-Covid logistical concerns have led developed economies to pursue “friend-shoring” or “near-shoring” policies.



“These plans are proving more difficult than policymakers might have envisioned, given inertia around supply chains and the challenge of cultivating the necessary skills among workers in new locales,” Temple said.



“Still, geopolitical tension is contributing to economic fragmentation which, at least in the short run, may dampen global growth and contribute to inflationary forces.”



On a positive note, Temple suggested that sustained disinflation should allow the U.S. Federal Reserve and other central banks to consider cutting interest rates as early as the second quarter, which should “mitigate headwinds to growth and invigorate capital expenditures in anticipation of a cyclical economic rebound.”



<h3 class="wp-block-heading">Security and semiconductors</h3>



GSAM Head of Asset &amp; Wealth Management Marc Nachmann and his team expect critical mineral supply chains to receive attention due to their growing importance in the clean energy transition, along with their potential vulnerability to supply shocks.



As a result, GSAM suggested investors should avoid trying to time the market or make calls on binary political or geopolitical outcomes, but instead take a proactive approach to asset allocation based on “extensive bottom-up research.”



“We think companies that successfully align with corporate and government efforts to boost the security of supply chains and resources as well as national security will emerge as long-term winners,” the strategists said, adding that firms with pricing power, durable business models and strong balance sheets should be the focus.



“Public equity market may present opportunities to gain targeted exposure to more established firms that produce semiconductors and to semiconductor manufacturing equipment, as well as to industrial automation and technology companies that are facilitating the reshoring of manufacturing.”



Demand for natural gas products is likely to rise, as nations seek affordable, reliable and sustainable energy, GSAM predicted, while growing and more complex security threats create opportunities for cybersecurity platforms and aerospace and defense technology providers.

107336684-1700507290931-gettyimages-1793715520-AFP_34474FX

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