Tsunami Waves Reach U.S. After Powerful Russia Quake

Summary

WSJ What’s News Summary

Episode: Tsunami Waves Reach U.S. After Powerful Russia Quake
Release Date: July 30, 2025
Host: Azhar Sucri, The Wall Street Journal

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1. Powerful Russia Earthquake Triggers U.S. Tsunami Alerts

A massive earthquake measuring 8.8 magnitude struck off Russia's eastern coast this morning, prompting tsunami warnings across Hawaii and Northern California. The United States Geological Survey (USGS) confirmed the quake as one of the 10 largest on record (00:32).

• Governor Josh Green of Hawaii issued a cautious advisory despite initial reports indicating minor wave impacts:

  "People have to really distinguish the waves we are accustomed to on the coast every day versus a tsunami. It's a different beast altogether... Houses will be damaged. There will be debris all over the place if we do get a full tsunami."
  — Governor Josh Green, 01:49

Officials urged residents to stay vigilant, emphasizing that it would take several hours before an all-clear signal could be issued. While initial waves were manageable, the potential for significant damage remains a concern as higher waves approach.

2. Federal Reserve's Interest Rate Decision Under Scrutiny

Investors are closely monitoring the Federal Reserve's upcoming interest rate decision, expected to maintain current rates. However, unprecedented dissent within the Fed could signal potential rate cuts, marking the first time in over three decades that multiple governors might oppose Chair Jerome Powell (02:08).

• Economics Editor Paul Hannan highlighted the internal conflicts within the Fed:

  "The thing that most policymakers are worried about is the impact of tariffs on inflation... On the other side of things, there are policymakers who are seeing signs of cooling in the jobs market... and they think that letting that continue would be a mistake."
  — Paul Hannan, 03:03

This division reflects broader economic uncertainties, including the effects of tariffs on consumer prices and employment. The dissenters' inclination towards rate cuts could heighten expectations for future monetary easing, impacting market dynamics significantly.

3. Tariffs' Mixed Impact on the Automotive and Luxury Sectors

The Trump administration's tariff policies continue to influence various industries, with specific effects observed in the automotive and luxury goods sectors.

• Business and Finance Editor Alex Frangos discussed the repercussions for car manufacturers:

  "Higher end carmakers are absorbing the tariffs into their profit margins rather than passing them on to customers because they're afraid of losing customers... but that means less profit left over for shareholders."
  — Alex Frangos, 07:25

European and Japanese carmakers, such as Porsche and Mercedes-Benz, are particularly vulnerable due to their reliance on imported parts. Conversely, Hermes has adeptly navigated these tariffs by leveraging its exclusive sales strategy:

"Hermes has this incredible ability to sell their most coveted product exactly when they need it... they have pent up demand that they can tap and that's what they do."
— Alex Frangos, 08:27

This strategic inventory management allows Hermes to maintain profitability despite broader market slowdowns affecting the luxury sector.

4. Trump Administration's Policy Shifts: Judicial Appointments and Climate Regulations

The administration continues to make significant policy changes affecting the judiciary and environmental regulations.

• Justice Department official Emile Beauvais was confirmed to a federal appeals court, securing a lifetime judicial appointment amid controversy:

  "He is not anybody's henchman."
  — Emile Beauvais, 10:11

In environmental policy, the EPA seeks to rescind the 2009 landmark regulation on carbon emissions, arguing it was "unduly pessimistic" about greenhouse gas impacts (10:11). However, data from the National Oceanic and Atmospheric Administration contradicts this claim, showing rising global temperatures.

Additionally, the administration reversed its decision to block funding for external health researchers, restoring millions of dollars for studies on diseases like diabetes and cancer following intervention by senior White House officials.

5. Surge in American Purchases of London Mansions Amid UK Market Decline

Despite a downturn in the UK high-end real estate market due to unfavorable tax policies and increased stamp duties, American buyers are capitalizing on the opportunity to purchase luxury properties in prestigious London neighborhoods such as Kensington and Chelsea.

• Journal Business and Finance Editor Alex Frangos provided insights into the dynamics:

  "Americans are snapping up these properties because... property taxes in America are so high... and they're seeing historically low prices."
  — Anvi Bhutani, 12:32

Anvi Bhutani elaborated on the motivations behind this trend:

"Americans are really used to paying taxes on their income regardless of where they live... they see this as their chance to get their hands on a mansion."
— Anvi Bhutani, 12:32

This influx is driven by Americans' comfort with high taxation environments and the comparatively lower impact of the UK’s one-time stamp duties on their investment strategies.

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Conclusion

Today's episode of WSJ What’s News covered a spectrum of critical topics, from the immediate impacts of a devastating earthquake in Russia affecting U.S. coastal regions to deep dives into economic policies and their ramifications on global markets. The Federal Reserve's potential rate adjustments, the mixed responses of industries to tariff policies, significant policy shifts by the Trump administration, and the burgeoning interest of American investors in London real estate collectively paint a comprehensive picture of the current economic and geopolitical landscape.

Stay informed with WSJ What’s News for the latest updates and in-depth analysis on the events shaping our world.

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Produced by: Daniel Bark and Kate Bullivant
Supervising Producer: Sandra Kilhoff

Transcript

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[Azhar Sucri]

A powerful earthquake off Russia's coast puts Hawaii and Northern California on tsunami alert. Plus more pressure on Powell not one, but two Fed governors could vote against the chair in today's rate setting meeting.

[Paul Hannan]

So there are disagreements about what exactly is happening in the economy and what the Fed should do about it. Today, the majority is expected to stay on the side of let's be cautious about the impact of tariffs, but these dissenters are likely to focus on the impact on the jobs market and Trump.

[Azhar Sucri]

Scraps the landmark finding that regulates carbon emissions. It's Wednesday, July 30th. I'm Azhar Sucri for the Wall Street Journal. Here the AM Edition of what's news, the top headlines and business stories moving your world today. Japan and parts of Northern California are under tsunami warnings after a powerful earthquake struck off the coast of Russia this morning local time, sending people fleeing to higher ground across the Pacific. The US Geological Survey measured the earthquake at magnitude 8.8, making it one of the 10 biggest on record, record if confirmed. Officials in Hawaii said the initial waves reaching the state this morning weren't significant and downgraded the tsunami warning to an advisory. But Governor Josh Green urged people to remain cautious, saying it would be several hours before an all clear signal could be given.

[Governor Josh Green]

People have to really distinguish the waves we are accustomed to on the coast every day versus a tsunami. It's a different beast altogether. That's why they have multiple measurements. It's even more dangerous, even more forceful. Houses will be damaged. There will be debris all over the place if we do get a full tsunami.

[Azhar Sucri]

Near the quake's epicentre on Russia's eastern coast, a local health minister told the media that some people were hurt while running out of their homes, but no serious injuries were reported. For more on this developing story, check out WSJ.com for further updates. Investors will be closely watching the Federal Reserve's interest rate decision today, with the central bank widely expected to leave its key rates unchanged. But this week's Fed meeting could see something that hasn't happened in over three decades. More than one governor voting against the chair, Jerome Powell is already under pressure from President Trump to accelerate the pace of rate cuts. And as economics editor Paul Hannan explains, the Fed chair is facing potential opposition from two Fed members who want to cut rates.

[Paul Hannan]

Investors are assuming that that is the next step and it's just a matter of time. And the dissenters will sort of reinforce that expectation if they vote for a cut that will increase expectations for a rate cut sometime soon. The thing that most policymakers are worried about is the impact of tariffs on inflation, right? They think that putting a tax on imports to the US Will have some effect on consumer prices. It will push prices higher. On the other side of things, there are policymakers who are seeing signs of cooling in the jobs market, and they think that letting that continue would be a mistake because maybe not immediately, but over time that would cool inflation too much and obviously create unnecessary unemployment.

[Azhar Sucri]

One of Trump's gripes with the Fed has been how the European Central bank has been cutting rates quicker. And this morning data revealed that the US And Europe are continuing to diverge in their economic fortunes.

[Paul Hannan]

So the eurozone economy did really well in the first three months of the year and now it's slowed quite a bit in the second quarter, although it avoided an expected contraction. Now that is largely about what's called front running of tariffs. That is to say, US Businesses stockpiling good goods that they expected to be tariffed to avoid the higher costs that would result from paying those tariffs. You can kind of flip that when you're thinking about the US So in the US first quarter, economic output was suppressed by these imports. The stockpiling in the second quarter that will unwind and economists are expecting to see a return to growth at a pretty decent rate this quarter.

[Azhar Sucri]

The Fed's interest rate decision is due out at 2pm Eastern, while the Commerce Department releases the first look at gdp in the second quarter at 8:30am and capping off an already busy day for markets will be earnings from two of the magnificent seven Microsoft and Meta. After the closing bell, tech giants are continuing to make sizable bets on artificial intelligence, with Meta CEO Mark Zuckerberg splashing multi million dollar pay packages on top AI talent as part of an ongoing recruitment drive. Tech investor and founder of Pro M Asset Management Imran Khan spoke to the WSJ's take on the Week podcast about the massive spending required for AI. He said companies like Google, Meta and Amazon haven't seen a significant boost in revenues yet and that it remains unclear whether the spending will pay off.

[Imran Khan]

Good things happen, but it takes time. It takes a lot of work. It takes a lot of iteration and when there's this kind of platform shift happens, it's uncharted territory in a lot of tech companies. You know, tech companies disrupted our traditional industries in many way. AI will disrupt the tech industry. So I think it's really important that when tech industry going to disrupt themselves first with AI, who is going to win and who is going to lose? From an investor perspective, I think you need to have a very clear, open mind and you have to be very flexible and see how the data comes in and who is winning.

[Azhar Sucri]

You can hear more from that interview in the latest episode of WSJ's take on the Week. Wherever you get your podcasts, a raft of results out this morning are dividing companies into winners and losers, with some sectors particularly vulnerable to tariffs following the first full quarter of earnings subject to President Trump's trade policies. Journal Business and finance editor Alex Frangos is with us. Alex, no surprises here. Carmakers Porsche and Mercedes Benz taking a real beating, it seems. Yeah.

[Alex Frangos]

I mean they're very exposed because they sell a lot of cars in the US And a lot of them are either made in Europe or some of them. Mercedes especially has a big operation in the U.S. but relies on parts from Europe. And the tariffs have. Well, we now have a deal with the eu. It's had a big impact on their bottom lines. What we're seeing is a lot of these higher end carmakers are absorbing the tariffs into their profit margins rather than passing them on to customers because they're afraid of losing customers. And so it's a natural thing to do. But that means less profit left over for shareholders.

[Azhar Sucri]

And Ford is out later. I guess we're going to get a real comparison between foreign and US Carmakers.

[Paul Hannan]

Yeah.

[Alex Frangos]

Well, there's this really interesting moment we're in right now where you have tariff deals having been struck in two of the biggest car manufacturing markets, Japan and the EU. They've 15% UK as well at 10%. But the US market, which of course can't be tariffed itself because it is the US market. But the US makers like Ford rely heavily on especially Mexico and Canada for parts, for assembly, for final assembly, all sorts of things. GM relies a lot on Korea, actually for some of their more affordable models. So the US Carmakers are sitting there thinking, well, Europe's got its deal, Japan's got its deal, but we don't know what's going to go on because Canada and Mexico have still not been resolved. So we'll get an outlook from Ford which will get a flavor of what they're seeing and how much they're being impacted.

[Azhar Sucri]

Now on the other hand, we've got luxury giant Hermes seemingly handling the tariffs pretty well.

[Alex Frangos]

Well, Hermes is a funny company. It's famous for the Birkin bag, you know, multi thousand dollar handbag. Broadly, the luxury industry has been hit pretty hard by slowdown in China, inability to pass on price increases in the U.S. it's one of its biggest markets. But Hermes has this special business model where they burk and bag, they hold back sales of it, they put people on these waiting lists. They have to kind of buy their the waiting list by becoming a loyal customer. And then when things are not great, they can sell more Birkin bags and that helps their bottom line. So they have this incredible ability to sell their most coveted product exactly when they need it. And there's just this pent up demand that they can tap and that's what they do.

[Azhar Sucri]

That was journal editor Alex Frangos. Thanks for joining us, Alex.

[Alex Frangos]

Thank you.

[Azhar Sucri]

Coming up, the Trump administration moves to dismantle a big bedrock climate tool that says greenhouse gases threaten public health and welfare. Plus, Americans are desperate to get their hands on a London mansion. Those stories and more after the break.

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[Azhar Sucri]

The Senate confirmed Justice Department official and former Trump defense attorney Emile Beauvais to a federal appeals court yesterday. The decision clinches a lifetime judicial appointment for Bouve over the objections of Democrats who accuse him of acting unethically and abusing his power. Bovet has denied the accusations, saying he is not anybody's quote, henchman. The Trump administration is taking a big swing at a landmark scientific assumption on greenhouse gas emissions. The Environmental Protection Agency said yesterday that it wants to rescind the basis of its rules regulating the output from power plants, aircraft, cars and more. The government's so called endangered. The EPA said the 2009 declaration was, quote, unduly pessimistic regarding increases in greenhouse gas emissions and global temperatures, which it said peaked in the 1930s. Data collected by the national oceanic and Atmospheric Administration and the EPA itself contradict that claim, finding that average global atmospheric temperatures are at their highest level since record keeping began in the 1850s. But it hasn't all gone Trump's way. We're reporting that his administration's effort to block all funding from outside health researchers was scrapped yesterday after senior White House officials intervened. According to people familiar with the matter, millions of dollars of funding to study diabetes, cancer and more are set to flow again. The White House did not respond to requests for comment about the reversal. And finally, Americans are snapping up London mansions like never before as sales of high end homes in the UK plummet. US Buyers who've long been drawn to elite neighbourhoods like Kensington and Chelsea not where I live of course, now make up the largest demographic of overseas buyers in the capital. It comes as many wealthy foreigners are being put off real estate in the city thanks to new tax policies and a higher stamp duty, a one time tax levied on buying a property. But as the Journal's Anvi Bhutani explains, that isn't a turn off for Americans.

[Anvi Bhutani]

So Americans are taking advantage of the dip in the market for two main reasons. One, Americans are really used to paying taxes on their income regardless of where they live. So this tax doesn't really burden them in the same way that it burdens other nationalities. And then the second is property taxes in America are so high, especially in states like New York, California, and so the one time stamp duty isn't really putting a dent in American demand. In fact, Americans are seeing the historically low prices, seeing that the market is doing bad, and they're like, this is my chance to get my hands on a mansion. And so real estate agents I've spoken to are finding that Americans are sometimes trying to buy one, two or a portfolio of investment properties and trying to get through multiple transactions very quickly in order to capitalize on this trend.

[Azhar Sucri]

And that's it for what's news this Wednesday morning. Today's show was produced by Daniel Bark and Kate Bullivant. Our supervising producer is Sandra Kilhoff. I'm Azhar Sucri for the Wall Street Journal. We'll be back tonight with a new show. Until then, thanks for listening.