Good morning. The U.S. Consumer Financial Protection Bureau said it would run out of funds in early 2026.

• Funding source issue: The consumer finance watchdog created in the wake of the 2008 housing crisis has adopted a new interpretation of its funding statute, finding it must draw from profits of the Federal Reserve rather than the central bank’s revenue, according to a court filing Tuesday backed by a memo from the Justice Department’s Office of Legal Counsel.
   
• Why it’s a problem: The Fed hasn’t been profitable since 2022, according to the memo. The CFPB didn’t give a specific date for when its funds will run out, but said it anticipated it would have sufficient funds to operate until at least the end of this year.
   
• Opposition: Sen. Elizabeth Warren (D., Mass.) called the filing another attempt by the CFPB’s acting director, Russell Vought, to illegally shut down the agency. Warren led the effort to create the CFPB. Vought, also director of the Office of Management and Budget, has headed many cost-cutting efforts under President Trump’s second administration.
   
• Background: The agency—which has faced criticism from conservatives ever since its creation under the Dodd-Frank Act—has been targeted for cuts since Trump took office. After being installed as acting head, Vought moved to close the CFPB’s Washington headquarters and laid off probationary workers. He also requested $0 in funding from the Fed.

Senate committee bill looks to make CFTC the main crypto regulator.

A Senate committee’s top leaders unveiled a draft of bipartisan legislation that would provide the Commodity Futures Trading Commission with new authority to regulate digital commodities.

The discussion draft, unveiled Monday by Sens. John Boozman (R., Ark.) and Cory Booker (D., N.J.), is built upon the Clarity Act, legislation approved by the House of Representatives in July that looks to transform cryptocurrency from a gray-area asset into a regulated, investible class.

The discussion draft is the first step in establishing the CFTC as overseer for the nascent sector. 

Fannie Mae watchdogs probed how Pulte obtained mortgage records of key Democrats.

Fannie Mae watchdogs who were removed from their jobs had been probing if Trump appointee Bill Pulte had improperly obtained mortgage records of key Democratic officials, including New York Attorney General Letitia James, according to people familiar with the matter.

What happened? Fannie’s ethics and investigations group had received internal complaints alleging senior officials had improperly directed staff to access the mortgage documents of James and others, according to the people. The Fannie investigators were probing to find out who had made the orders, whether Pulte had the authority to seek the documents and whether or not they had followed proper procedure, the people said..

• This year has been tough for the climate industry, as backlash against ESG investing has led many companies to retreat from a sector that had seen consistent growth over the past decade. However, the economic case for investing in the climate industry remains more powerful than ever, according to Marie Freier, head of sustainability at Barclays.
   
• Democratic lawmakers asked the Justice Department to probe the proposed bankruptcy sale of nursing home chain Genesis Healthcare to insiders, saying it may amount to an abuse of chapter 11 aimed at wiping away liabilities to patients and families for alleged negligence.
   
• Two U.S. lawmakers have introduced legislation that would require the executive branch to develop a comprehensive strategy to disrupt growing cooperation among China, Russia, Iran and North Korea, Risk Journal reports. 
   
• China added the U.S., Mexico and Canada to its export controls list for precursor chemicals used in drug manufacturing, following commitments made during the trade deal reached between President Trump and President Xi, China’s Ministry of Commerce announced Monday.

It’s going to be really hard to work out how much the shutdown hurt the economy.

The longest government shutdown on record has taken a bite from the economy. But the roiling effects of the closure, as well as the data disruptions it brought on, are likely to make it hard to know just how big that bite was.

With each passing day, the now six-week shutdown’s drag on the economy has become more apparent. Thousands of furloughed government workers haven’t been paid, and have reduced their spending as a result. Delayed payments under the Supplemental Nutrition Assistance Program, or SNAP, led many people to further tighten their belts. Flight delays and cancellations added to the headaches.

The shutdown also added to economic uncertainty, and further soured Americans’ views of the economy.

Europe is in a gray zone between war and peace.

Europe is now caught somewhere between war and peace.

In recent weeks, drones appearing mysteriously above airports and halting flights have made headlines. Those are just the tip of the iceberg.

“We are not at war” with Russia, German Chancellor Friedrich Merz said recently, “but we are no longer at peace either.”

• In the AI cold war, America holds a sizable lead, but China is working to tip the scales with a sweeping countrywide push, betting “swarms beat the titan.”
   
• The U.S. Navy’s largest aircraft carrier arrived in waters near Latin America on Tuesday, expanding the American military’s buildup as the Trump administration seeks to ratchet up the pressure on Venezuelan President Nicolás Maduro.
   
• Pakistan blamed India-backed militants for a suicide bombing that killed 12 people in Islamabad on Tuesday, raising the prospect of renewed tensions between the nuclear-armed rivals.
   
• Infant-formula maker ByHeart has recalled all of its products in the U.S. after the Food and Drug Administration opened an investigation into a multistate botulism outbreak.
   
• President Trump said he was considering lowering tariffs on goods from Switzerland.

• Tech giants need so much money for their artificial-intelligence ambitions that Wall Street is developing new ways to get it for them.
   
• Senate Minority Leader Chuck Schumer (D., N.Y.) wasn’t one of the Democratic senators who voted with Republicans to back GOP legislation to end the government shutdown. He is still taking most of the blame.
   
• Every year, hundreds of thousands of U.S. workers take on seasonal jobs during the holidays. This year those jobs look harder to come by.
   
• Some of the world’s biggest deposits of copper—needed for everything from air conditioners to electric vehicles—sit untapped underneath Argentina, a country that mining companies considered off limits because of its red tape and economic turmoil. That’s about to change fast.

Follow us on X at @WSJRisk. Send tips to our reporters Max Fillion at max.fillion@dowjones.com, Mengqi Sun at mengqi.sun@wsj.com and Richard Vanderford at richard.vanderford@wsj.com.

You can also reach us by replying to any newsletter, or by emailing our editor David Smagalla at david.smagalla@wsj.com.