The U.S. Sits Down With Russia

Summary

WSJ What’s News – Episode: The U.S. Sits Down With Russia Release Date: February 18, 2025
Host: The Wall Street Journal

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1. U.S.-Russia High-Level Diplomatic Talks

Overview:
In a significant diplomatic move, the United States and Russia convened their highest-level talks in years in Riyadh, Saudi Arabia, aiming to lay the groundwork for ending the ongoing war in Ukraine. These discussions represent a concerted effort by the Trump administration to restore U.S.-Russian relations and seek a resolution to the conflict.

Participants:

• United States: Secretary of State Marco Rubio, National Security Advisor Mike Waltz, and Middle East Envoy Steve Witkoff.
• Russia: Foreign Minister Sergei Lavrov and Foreign Policy Aide Yuri Ushakov.
• Absence: Ukraine is notably not present in these negotiations.

Key Objectives:
The primary goal is to establish the foundations for a potential summit between President Trump and President Putin, which could pave the way for formal peace negotiations.

Notable Quotes:

• Luke Vargas [02:05]: "All of this has come together quite quickly, has it not?"
• Unnamed Correspondent [02:05]: "President Trump's a man of action and he wants to move forward and improve U.S.-Russian relations and bring the Ukraine war closer to an end."

Rapid Progress and European Concerns:
The swift organization of these talks, orchestrated before substantial involvement from European allies, has caused unease among NATO members and Ukraine. European nations are now seeking to assert their influence in the peace process.

European Response:

• Britain and Sweden have expressed readiness to deploy troops in Ukraine in a peacekeeping capacity to ensure any potential settlement's stability.
• France's President Macron convened a meeting with European leaders, including those from the UK and Germany, to strategize Europe's role moving forward.

Tensions and Diplomatic Maneuvering:
The European proposal to involve their troops has been a point of contention, with Russia rejecting the idea outright ("The Russians have ruled that out. They said they won't accept European troops in Ukraine." [03:42]). The United States maintains that deploying its troops is off the table for securing a peace settlement.

Quotes Illustrating Diplomatic Stance:

• Unnamed Correspondent [03:42]: "The Russians have ruled that out. They said they won't accept European troops in Ukraine."
• Luke Vargas [03:48]: "Is that potential European security guarantee making its way into the substance of these talks today?"

Current Status:
The ongoing talks in Riyadh appear preliminary, focusing on restoring diplomatic relations rather than delving deeply into the specifics of a peace settlement. Russia aims to have sanctions lifted and to open the door for formal negotiations involving Ukraine eventually, albeit without European military involvement.

2. Impact on European Defense Markets

Market Reaction:
The uncertainty surrounding the peace talks and the potential for increased European military involvement has led to a surge in defense sector stocks across Europe.

Stock Highlights:

• BAE Systems (London-listed)
• Thales (France)
• Rheinmetall (Germany)

These companies saw significant stock price increases following NATO Secretary General Mark Rutte's comments on defense spending.

Defense Spending Increase:

• Mark Rutte [05:07]: "The alliance's defense spending targets would need to be considerably more than 3% of GDP, up from a current target of 2% agreed to in 2014."
• Ursula von der Leyen [05:11]: President of the European Commission, projected that the EU's combined defense spending would need to rise by hundreds of billions of euros annually to meet the new targets.

Implications:
This substantial increase in defense budgets reflects Europe's response to the shifting geopolitical landscape and the need for enhanced military readiness in light of ongoing tensions.

3. Delta Air Lines Flight Crash in Toronto

Incident Details:
A Delta Air Lines regional flight, operated by Endeavour Air, tragically crashed while attempting to land at Toronto's Pearson Airport amidst severe winter weather conditions.

Casualties and Injuries:

• Injuries: At least 18 people were injured.
• Fatalities: No fatalities reported.
• Passengers and Crew: All 80 individuals aboard were safely evacuated despite the dramatic crash.

Visual and On-Ground Reports:

• Dramatic Footage: Social media shared images of the Bombardier jet in a perilous state—upside down and stripped of its wings on the tarmac ([05:23]).
• Live Communications: Recordings between air traffic control and emergency responders captured the chaotic scene shortly after the crash ([05:54]).

Weather Conditions Impact:
Toronto and the broader U.S. Northeast had been grappling with a winter storm, complicating the landing process:

• Snow Clearance: Airport officials were engaged in removing snow from the airfield ([06:16]).
• Anticipated Weather: Strong winds were expected to persist, adding to the challenges faced by the flight crew.

Quotes Highlighting the Incident:

• Unnamed Reporter [06:04]: "There's people outside walking around the aircraft there. Yeah, we've got it. The aircraft there's upside down and burning."
• Luke Vargas [05:34]: "We've got those stories and more after the break."

4. Political Turmoil in New York City: Governor Hochul Considers Removing Mayor Adams

Background:
New York Governor Kathy Hochul is contemplating the unprecedented removal of Mayor Eric Adams amidst significant turmoil within City Hall.

Catalyst – Justice Department Order:
The Justice Department instructed Manhattan prosecutors to drop a bribery case against Mayor Adams, citing that his indictment interfered with his ability to collaborate with President Trump's immigration enforcement initiatives.

Consequences:

• Resignations: Several top prosecutors and four deputy mayors have resigned in response to the Justice Department's action.
• Calls for Removal: Prominent New York City officials are urging Mayor Adams to step down or be removed from office.
• Governor's Authority: Hochul has the constitutional power to remove the mayor, a step that has never been taken before in New York City ([07:19]).

Governor Hochul's Actions:
She is scheduled to meet with city leaders to discuss strategies for restoring stability within the municipal government ([07:37]).

Quotes Illustrating the Situation:

• Dana Telsey [09:40]: "They really showcase that this is not the Walmart of 30 or 40 years ago."
• Unnamed Correspondent [08:01]: "Hochul is set to meet with city leaders today to discuss bringing stability to the government."

5. Other Major News Highlights

a. Reserve Bank of Australia Cuts Interest Rates

• Action: The Reserve Bank of Australia has reduced interest rates for the first time since 2020.
• Objective: This move aligns Australia with global monetary easing cycles and aims to increase electoral prospects ahead of federal elections scheduled for mid-May, where the cost of living is anticipated to be a pivotal issue ([07:13]).

Quote:

• Michael Gordon [08:20]: "Australia's Labour government is banking on the quarter point but boosting its odds ahead of federal elections to be held by mid May."

b. Southwest Airlines Workforce Reduction

• Announcement: Southwest Airlines plans to cut 15% of its corporate workforce, equating to over 1,700 jobs, marking the airline's first significant layoffs in its 53-year history.
• Reason: The layoffs are a strategic shift following conflicts with activist investor Elliott Investment Management and ongoing challenges in the airline industry.

Market Impact:

• Stock Performance: Although Southwest shares are experiencing upward movement in after-hours trading, the stock remains down approximately 10% for the year ([08:42]).

Quote:

• Michael Gordon [08:45]: "The cuts are due to take effect in late April and are the most tangible signs of a shift in the airline's strategy after a battle with activist Elliott Investment Management last year."

c. Walmart Earnings and Market Positioning

• Upcoming Report: Walmart is set to announce its earnings later in the week.
• Strategic Insights: WSJ's podcast "Take on the Week" delves into Walmart's strategy of appealing to a broader customer base, enabling the retailer to attain valuation multiples typically reserved for tech stocks.

Podcast Highlights:

• Dana Telsey [09:26]: "What has Walmart been doing to appeal more to wealthier customers? [...] CEO Doug McMillan has said that they're really making inroads with high end shoppers."

Factors Contributing to Success:

• Enhanced marketing and brand awareness.
• Strategic placement and optimization of physical store locations.
• Robust loyalty programs and reliable shipment services.
• Rebranding efforts to modernize the Walmart image, moving away from traditional perceptions.

Quote:

• Dana Telsey [09:40]: "They really showcase that this is not the Walmart of 30 or 40 years ago."

6. Conclusion

Summary:
This episode of WSJ What’s News provided an in-depth analysis of the pivotal U.S.-Russia talks aimed at resolving the Ukraine conflict, highlighting the complexities introduced by the exclusion of European allies and the broader geopolitical ramifications. Additionally, the podcast covered significant incidents and developments in aviation, political upheaval in New York City, economic policy shifts in Australia, corporate restructuring in Southwest Airlines, and Walmart's strategic market positioning.

Future Outlook:
Listeners are encouraged to stay tuned for further developments from the Riyadh talks, the potential political fallout in New York City, and upcoming corporate earnings reports that may influence market dynamics.

Final Remarks:
Produced by Daniel Bach and Kate Bullivant with supervising producer Christina Rocca, the episode encapsulated critical global and domestic issues shaping the news landscape.

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Notable Transcripts Extracted for Reference:

• Ryan Reynolds Ad [00:00 - 00:32]: Initial advertisement promoting Mint Mobile, skipped as per instructions.
• Main Content [00:33 - 10:27]: Detailed discussions on U.S.-Russia talks, market impacts, the Delta crash, political news, and other major stories, all covered comprehensively above.

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For further insights and detailed discussions, refer to the full transcript and latest episodes available on WSJ's platforms.

Transcript

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[Luke Vargas]

Injuries but no fatalities after a dramatic Delta Air Lines crash in Toronto.

[Michael Gordon]

Plus, the U.S. and Russia hold talks.

[Luke Vargas]

To pave the way for Ukraine peace negotiations, rattling Washington's European allies.

[Unnamed Correspondent]

And these nations in a sense are trying to get at least a figurative seat at the negotiation table by saying they may be prepared to put their troops on the ground in Ukraine to secure a settlement.

[Michael Gordon]

And and New York's governor weighs the unprecedented step of removing Mayor Eric Adams from office. It's Tuesday, February 18th.

[Luke Vargas]

I'm Luke Vargas for the Wall Street Journal and here is the AM edition.

[Michael Gordon]

Of what's news, the top headlines and business stories moving your world today.

[Luke Vargas]

The US And Russia are holding their highest level talks in years today as the Trump administration attempts to lay the groundwork for negotiations to end the war in Ukraine. Journal national security correspondent Michael Gordon is in the Saudi capital Riyadh, where the.

[Michael Gordon]

Talks are taking place. Michael, the US Today is being represented by Secretary of State Marco Rubio, National Security Advisor Mike Waltz and Middle east envoy Steve Witkoff, while Russia is represented there by Foreign Minister Sergei Lavrov and foreign policy aide Yuri Ushakov. Ukraine is not present. You report that the goal of this is to lay the groundwork for a summit between President Trump and President Putin. All of this has come together quite quickly, has it not?

[Unnamed Correspondent]

Well, this is not unusual for this Trump administration. President Trump spoke with President Putin last week and in less than seven days, top officials on both sides are meeting here in Riyadh, a meeting that was basically set in motion before the United States European allies were deeply brought into the picture. Trump administration officials say the president's a man of action and he wants to move forward and improve U. S. Russian relations and bring the Ukraine war closer to an end. But the way it was done is a source of some angst to European nations and of course to Ukraine.

[Michael Gordon]

Yeah, tell us more about that if you could.

[Luke Vargas]

Given that Europe's exclusion from these talks.

[Michael Gordon]

Led to some rather urgent diplomacy over the weekend.

[Unnamed Correspondent]

Well, one response was President Macron of France held a meeting and convened leaders from a number of European countries, including the UK And Germany, to discuss the way forward from the European perspective. But really the most significant thing is Britain said they were prepared to deploy troops in Ukraine in a sort of peacekeeping role to safeguard an agreement if there ever is a peace settlement between Ukraine and Russia. And Sweden has also indicated they may be prepared to do that. And these nations, in a sense, are trying to get at least a figurative seat at the negotiation table, if not a literal one, by saying they may be prepared to put their troops on the ground in Ukraine in this sort of peacekeeping role to secure a settlement step the United States has ruled out for its own troops.

[Luke Vargas]

And is that potential European security guarantee making its way into the substance of these talks today?

[Unnamed Correspondent]

It's a little early to tell. The Russians have ruled that out. They said they won't accept European troops in Ukraine. But now it's up to the United States to set the terms of a peace settlement. I don't know that these issues are going to be wrestled to the ground today. The talks that are going on here in this palace in Riyadh seem to be a little more preliminary to see if there's a basis for restoring US Russian relations. The Russians want to get sanctions waived soon if they can, and also to lay the foundation for eventual formal talks for a peace settlement over the conflict in Ukraine that would involve the participation of Ukraine, though, not the Europeans.

[Michael Gordon]

That was Wall Street Journal national security.

[Luke Vargas]

Correspondent Michael Gordon in Riyadh.

[Michael Gordon]

Michael, thank you so much.

[Unnamed Correspondent]

Thank you.

[Luke Vargas]

Well, as we wait to see what comes out of those Riyadh talks, the prospect of higher military spending across Europe pushed stocks in the continent to new highs yesterday. Leading the way were London listed BAE Systems, France's Thales, and Germany's Rheinmetall, all of which jumped following comments from NATO Secretary General Mark Rutte that the alliance's defense spending targets would need to be considerably more than 3% of GDP, up from a current target of 2% agreed to in 2014.

[Michael Gordon]

European Commission President Ursula von der Leyen put a price tag on that target.

[Luke Vargas]

Predicting the EU's 27 members would need to increase combined defense spending by hundreds.

[Michael Gordon]

Of billions of euros every year.

[Luke Vargas]

American and Canadian authorities are investigating an incident involving a Delta Air Lines regional flight that left at least 18 people.

[Michael Gordon]

Injured at Toronto's Pearson Airport yesterday.

[Luke Vargas]

Dramatic images posted on social media show the Bombardier jet upside down on the.

[Michael Gordon]

Tarmac and stripped of its wings after.

[Luke Vargas]

The flight from Minneapolis crashed while landing. All 80 passengers plus crew aboard the flight, which was operated by Delta's regional.

[Michael Gordon]

Subsidiary Endeavour Air, were evacuated and survived.

[Luke Vargas]

Communications between air traffic control and emergency workers captured the scene shortly after the crash.

[Michael Gordon]

Courtesy of liveatc.net Just so you are.

[Unnamed Reporter]

There'S people outside walking around the aircraft there. Yeah, we've got it. The aircraft there's upside down and burning.

[Michael Gordon]

Toronto, like much of the US Northeast.

[Luke Vargas]

Has been hit by a winter storm in recent days.

[Michael Gordon]

Earlier yesterday, airport officials said they were.

[Luke Vargas]

Working to clear snow from the airfield.

[Michael Gordon]

And that they anticipated strong winds coming up.

[Luke Vargas]

New York Governor Kathy Hochul considers removing.

[Michael Gordon]

Mayor Eric Adams from his post and.

[Luke Vargas]

Southwest Airlines slashes its corporate workforce.

[Michael Gordon]

We've got those stories and more after the break.

[Global X Advertiser]

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[Luke Vargas]

New York Governor Kathy Hochul is suggesting she'll consider removing Mayor Eric Adams.

[Michael Gordon]

From his post amid turmoil at City Hall. The mayor's administration has been rocked by.

[Luke Vargas]

The Justice Department's recent order to Manhattan prosecutors to drop their bribery case against Adams, saying his indictment interfered with his ability to participate in President Trump's immigration enforcement.

[Michael Gordon]

That move prompted several top prosecutors to.

[Luke Vargas]

Resign and some New York City officials to call on Adams to step down or be removed from office. Yesterday, four deputy mayors in Adams administration also resigned. Hochul is set to meet with city leaders today to discuss bringing stability to the government. As New York City governor, she has the power to remove the mayor from.

[Michael Gordon]

Office, though this step has never been taken before. Adams didn't immediately respond to a request for comment.

[Luke Vargas]

In markets news today, the Reserve bank of Australia has cut interest rates for the first time since 2020, joining overseas counterparts in the global easing cycle.

[Michael Gordon]

Australia's Labour government is banking on the.

[Luke Vargas]

Quarter point but boosting its odds ahead of federal elections to be held by.

[Michael Gordon]

Mid May, in which the cost of.

[Luke Vargas]

Living is expected to be a central issue. Back in the U.S. southwest Airlines is preparing to cut 15% of its corporate workforce, or more than 1700 jobs, in the first mass layoff in its 53 year history.

[Michael Gordon]

The cuts are due to take effect in late April and are the most.

[Luke Vargas]

Tangible signs of a shift in the.

[Michael Gordon]

Airline'S strategy after a battle with activist.

[Luke Vargas]

Elliott Investment Management last year.

[Michael Gordon]

Southwest shares are edging higher in off trading. The stock is down about 10% so far this year.

[Luke Vargas]

And finally, Walmart is due to report earnings later this week. And WSJ's take on the Week podcast has been taking a closer look at the retailer and why its shares are trading at tech stock multiples. On Sunday's episode, co host Telus Demos sat down with Dana Telsey, the CEO and founder of consumer research firm Telsey.

[Michael Gordon]

Advisory Group, to discuss how Walmart's found success by targeting a broader customer base.

[Telus Demos]

What has Walmart been doing to appeal more to wealthier customers? Like what have they been doing? I know I've read a little bit about their sort of private labels and things like that. What else have they done? You know, CEO Doug McMillan has said that they're really making inroads with high end shoppers. What's been behind that?

[Dana Telsey]

I think the awareness and the marketing, I think the physical store locations, I think the loyalty programs, the essential nature of their goods, the ease of shipments that they've been delivering. They've been on time and they really showcase that this is not the Walmart of 30 or 40 years ago. Look what they did in their name. They took away the name Walmart stores because they're all channels in terms of appealing to the consumers.

[Luke Vargas]

And to check out the rest of that conversation, look for the latest episode of WSJ's Take on the Week on.

[Michael Gordon]

YouTube or wherever you get your podcasts.

[Luke Vargas]

And that's it for what's news for this Tuesday morning.

[Michael Gordon]

Additional sound in this episode was from Reuters. Today's show was produced by Daniel Bach and Kate Bullivant with supervising producer Christina Rocca. And I'm Luke Vargas for the Wall Street Journal.

[Luke Vargas]

We will be back tonight with a.

[Michael Gordon]

New show and until then, thanks for listening.