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    Will A.I. Be a Bust? A Wall Street Skeptic Rings the Alarm.

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    Jim Covello, Goldman Sachs’s head of stock research, warned that building too much of what the world doesn’t need “typically ends badly.”As Jim Covello’s car barreled up highway 101 from San Jose to San Francisco this month, he counted the billboards about artificial intelligence. The nearly 40 signs he passed, including one that promoted something called Writer Enterprise AI and another for Speech AI, were fresh evidence, he thought, of an economic bubble.“Not that long ago, they were all crypto,” Mr. Covello said of the billboards. “And now they’re all A.I.”Mr. Covello, the head of stock research at Goldman Sachs, has become Wall Street’s leading A.I. skeptic. Three months ago, he jolted markets with a research paper that challenged whether businesses would see a sufficient return on what by some estimates could be $1 trillion in A.I. spending in the coming years. He said that generative artificial intelligence, which can summarize text and write software code, makes so many mistakes that it was questionable whether it would ever reliably solve complex problems.The Goldman paper landed days after a partner at Sequoia Capital, a venture firm, raised similar questions in a blog post about A.I. Their skepticism marked a turning point for A.I.-related stocks, leading to a reassessment of Wall Street’s hottest trade.Goldman’s basket of A.I. stocks, which is managed by a separate arm of the firm and includes Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta and Oracle, has declined 7 percent from its peak on July 10, as investors and business leaders debate whether A.I. can justify its staggering costs.The pause has come early in the A.I. arms race. The tech industry has a history of spending big to deliver technology transitions, as it did during the personal computer and internet revolutions. Those build outs spanned five years or more before there was a reckoning.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      The Worst Part of a Wall Street Career May Be Coming to an End

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      Artificial intelligence tools can replace much of Wall Street’s entry-level white-collar work, raising tough questions about the future of finance.Pulling all-nighters to assemble PowerPoint presentations. Punching numbers into Excel spreadsheets. Finessing the language on esoteric financial documents that may never be read by another soul.Such grunt work has long been a rite of passage in investment banking, an industry at the top of the corporate pyramid that lures thousands of young people every year with the promise of prestige and pay.Until now. Generative artificial intelligence — the technology upending many industries with its ability to produce and crunch new data — has landed on Wall Street. And investment banks, long inured to cultural change, are rapidly turning into Exhibit A on how the new technology could not only supplement but supplant entire ranks of workers.The jobs most immediately at risk are those performed by analysts at the bottom rung of the investment banking business, who put in endless hours to learn the building blocks of corporate finance, including the intricacies of mergers, public offerings and bond deals. Now, A.I. can do much of that work speedily and with considerably less whining.“The structure of these jobs has remained largely unchanged at least for a decade,” said Julia Dhar, head of BCG’s Behavioral Science Lab and a consultant to major banks experimenting with A.I. The inevitable question, as she put it, is “do you need fewer analysts?”The inevitable question, according to Julia Dhar, head of BCG’s Behavioral Science Lab, is “do you need fewer analysts?”John Lamparski/Getty Images for Concordia SummitWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Wall Street strategists’ bull and bear scenarios for 2024.

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      Wall Street’s forecasts mostly missed this year’s bull market rally. Here’s what strategists are saying about 2024.Last November and December, veteran stock market watchers forecast that 2023 would be a year to forget. They saw high inflation, a looming global recession and rising interest rates as sapping households’ buying power and denting corporate profits. For investors, they penciled in paltry gains and one of the worst performances for the S&P 500 in the past 15 years.But the market pros got the story only partly right. While interest rates did climb to a near two-decade peak, the S&P 500 has surprisingly soared to a near record high. Fueled partly by a rally in the so-called Magnificent Seven megacap tech stocks, it’s risen nearly 25 percent this year, as of Thursday’s close, shaking off a banking crisis, wars in the Middle East and Ukraine, and slowing growth in China’s economy.Crypto managed to do even better. Bitcoin bulls have swept aside a legal crackdown against the industry’s biggest players to fuel an impressive rally. The digital token has gained more than 150 percent this year, making it one of the best performing risky assets.“Twenty twenty-three was a great year for the contrarians,” David Bahnsen, the founder and chief investment officer of the Bahnsen Group, a wealth management firm, told DealBook. “You had macroeconomic concerns a year ago that didn’t come to bear, and you had valuation and financial concerns that didn’t come to bear. And it’s particularly ironic that it didn’t, because actually everything investors feared a year ago got worse.”Wall Street’s outlook for 2024 is rosier. Analysts see lower borrowing costs, a soft landing (that is, an economic slowdown that avoids a recession) and a pretty good year for investors.But if 2023 taught the market pros anything, it’s that forecasts can look out of date pretty fast. A slew of things could disrupt the markets in the year ahead — inflation creeping up again, or not, is one big factor to watch. And there are wild cards, too, with voters expected to head to the polls in over 50 countries next year, including the U.S.Here’s how Wall Street sees 2024 playing out:The bull caseThe median year-end 2024 forecast for the S&P 500 is 5,068, according to FactSet. Such a level would imply an annualized gain of roughly 6 percent for 2024.Bank of America’s equity strategists, led by Savita Subramanian, are among those in the bullish camp. In their annual forecast, they said that the S&P 500 would be likely to close out next year at 5,000, helped by a kind of “goldilocks” scenario of falling prices and rising corporate profits.Goldman Sachs is even more upbeat. Its analysts upgraded their year-end 2024 call on the S&P 500 to 5,100. They made the change after the Fed’s surprise statement on Dec. 13 that the equivalent of three interest-rate cuts were on the table for next year. Lower borrowing costs tend to give consumers and businesses more spending power, which could help Corporate America’s bottom line.Another catalyst: Investors this year put far more money into safe interest-rate sensitive assets, like money market funds, than they did into stocks. That logic could be flipped on its head in 2024. “As rates begin to fall, investors may rotate some of their cash holdings toward stocks,” David Kostin, the chief U.S. equity strategist at Goldman Sachs, said in a recent investor note.The bear caseOn the more pessimistic side is JPMorgan Chase, which carries a 2024 year-end target of 4,200. Its analysts team, led by Marko Kolanovic, the bank’s chief global market strategist, sees a struggling consumer with depleted savings, a potential recession and geopolitical uncertainty that could push up commodity prices, like oil, and push down global growth.The year ahead will be “another challenging year for market participants,” Kolanovic said. (Most strategists are even more downbeat on Europe, where recession fears are more acute. On the flip side, equities in Asia could show another year of solid growth, especially in India and Japan, Wall Street analysts say.)Lee Ferridge, the head of multi-asset strategy for North America at State Street Global Markets, is more optimistic about the American consumer, but points to a different challenge for investors. “If I’m right, the economy stays stronger. But then that’s a double-edged sword for equities,” he said. The prospect of robust consumer and business spending poses an inflation risk that could force the Fed to hold rates higher for longer, and even pause cuts, he said. “That’s going to be a headwind for equities.”“I wouldn’t be surprised to see a fairly flat year next year,” he added. “If we are up, it’s going to be the Magnificent Seven that are the drivers again.”The wild card: politics and the electionsPresidential elections are not rally killers, according to market analysis by LPL Financial that looks at the past 71 years. In that period, the S&P has risen, on average, by 7 percent during U.S. presidential election years. (The market tends to do even better in a re-election year, the financial advice firm notes.)Even with some uncommon questions swirling over next year’s contest — Will a mountain of legal troubles derail the Republican front-runner, Donald Trump? Will President Biden’s sagging polling ratings open the door for a strong third-party challenger? Will the election result be disputed, causing a constitutional crisis? — that’s unlikely to add much volatility to the markets, Wall Street pros say.“The election will not be a story in the stock market, up until November 2024, for the simple reason that the stock market will not know who’s going to win the election until November 2024,” Bahnsen said.His advice: Don’t even try to game out the election’s impact on the markets. More

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      Biden Makes His Business Case in the State of the Union Address

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      The president took credit for strong job growth and his legislative agenda that’s boosted investment in infrastructure and clean energy projects.“I will make no apologies.”Pool photo by Jacquelyn Martin-Pool/Getty Images.Biden picks his battles President Biden delivered a State of the Union address to Congress on Tuesday night that was filled with dramatic moments, meant in part to jump start his 2024 re-election campaign.He also used the speech to press his economic priorities, from bolstering American manufacturing to extending his climate efforts. How far he advanced his causes, however, remains to be seen.Mr. Biden defended his record on the economy. He took credit for falling inflation and strong job growth, and listed promised benefits from his sweeping legislative agenda, including infrastructure, clean energy (even if he did acknowledge, “we’re still going to need oil and gas for a while”) and manufacturing laws that will pour trillions into the economy.He also urged Congress to back initiatives including raising a billionaires tax on the wealthy; expanding a measure in the Inflation Reduction Act that caps the cost of insulin at $35 a month; renewing the expanded child tax credit; and expanding Medicaid and affordable child care.He baited Republicans over social welfare programs. Mr. Biden accused some Republicans of threatening Social Security and Medicare, implying they wanted cuts in exchange for a deal to raise the debt ceiling. (That claim requires a bit of context.) Several lawmakers shouted in response; one, Representative Marjorie Taylor Greene of Georgia, yelled “Liar!”Mr. Biden responded that he had somehow gotten unanimity on the issue. “We all apparently agree, Social Security and Medicare is off the books now, right?” he said, leading a bipartisan round of applause for seniors.He kept up pressure on ripe political targets. Though Mr. Biden didn’t directly address the Chinese spy balloon incident, he pledged to make America more competitive and less reliant on China. “I will make no apologies that we are investing to make America strong,” he said. “Investing in American innovation — in industries that will define the future, and that China’s government is intent on dominating.”Mr. Biden also called out tech companies, demanding stricter limits on their collection of personal data, and oil giants, which he accused of raking in record profits from high energy prices instead of using their huge coffers to increase domestic production.How much cooperation Mr. Biden will get from Republicans and business is unclear. In Republicans’ rebuttal, Gov. Sarah Huckabee Sanders of Arkansas accused him of perpetrating a culture war. Corporate America was more circumspect: Suzanne Clark, the head of the U.S. Chamber of Commerce, reiterated her group’s support for the infrastructure law, but urged Biden to focus on striking more trade agreements and pulling back from what she said was overregulation.HERE’S WHAT’S HAPPENING The U.S. trade deficit balloons to $948 billion. The export-import gap jumped 12 percent in 2022, to a record, as Americans continued to spend more on imported goods than travel and entertainment. Trade data also showed growing deficits in goods with the likes of Mexico and South Korea, as manufacturers seek bases outside China.Microsoft announces A.I.-powered consumer internet tools. The tech giant promised versions of its Bing search engine and Edge browser that incorporate chatbots, drawing on a partnership with the ChatGPT creator OpenAI. Microsoft’s ambitions may be bigger: It’s reportedly planning to create software to let companies make their own ChatGPT-powered chatbots.Zoom plans to lay off 15 percent of its staff. The videoconferencing company acknowledged it had hired too many people during its pandemic boom, and needed to retrench as growth has slowed. Its C.E.O., Eric Yuan, said he plans to cut his salary for the coming fiscal year by roughly 98 percent and forgo a bonus.A former Coinbase employee pleads guilty to insider trading. Ishan Wahi, who was a product manager at the crypto exchange, had been accused of tipping his brother and a friend about tokens it planned to list, bringing about $1.5 million in illegal profit. He’s the first crypto insider to admit insider trading.Chobani’s founder urges U.S. companies to fund recovery efforts for the earthquake in Turkey and Syria. Hamdi Ulukaya, a Turkish immigrant, has partnered with the Turkish Philanthropy Funds to aid in recovery from the quake, which has a death toll above 11,000. He told DealBook that he has personally donated $2 million to the cause.Jay Powell sees a “bumpy” path ahead America’s red-hot labor market suggests that the world’s biggest economy may yet avoid recession. But this same dynamic has also thrust the Fed into a policy conundrum, with pressure for higher interest rates to tamp down inflation.In a question-and-answer session at the Economic Club of Washington on Tuesday, the Fed’s chair, Jay Powell, said he could see “the very early stages of disinflation,” but added that the easing in prices was likely to follow a “bumpy” path, particularly with hiring and wage growth proving strong.January’s jobs data surpassed the Fed’s forecasts. Mr. Powell said last Friday’s knockout nonfarm payroll report, which announced that employers added 517,000 new jobs last month, was “certainly strong — stronger than anyone I know expected.”Other data offered more encouraging signs for the U.S. economy. The Atlanta Fed’s GDPNow tracker forecasts that the U.S. will grow by 2.1 percent in the first quarter; it was predicting 0.7 percent a week ago. And even bearish economists are dialing down their gloomy expectations: “A potential recession in 2023 will likely be short and shallow,” Jeffrey Roach, the chief economist for LPL Financial, wrote to investors on Tuesday, while Goldman Sachs economists this week lowered their estimate of the likelihood of a U.S. recession to 25 percent.Investors were relieved that Mr. Powell gave no hint of a sudden shift in the Fed’s strategy. He reiterated that the central bank planned to keep raising borrowing costs to rein in consumer spending. That was enough to reassure investors that no big policy changes were coming soon: The S&P 500 rallied after his comments, snapping a two-day losing streak.A hedge fund catches meme fever Hudson Bay Capital Management has emerged as the mystery backer of Bed Bath & Beyond’s bold plan to cash in on its meme-stock cachet to raise $1 billion in emergency funds and avert bankruptcy.The hedge fund’s involvement in the deal highlights the meme-stock frenzy’s pull on big institutions. Shares in the struggling retailer, which has closed 400 stores in the past year as revenues slide, are up nearly 86 percent in the past month in extremely volatile trading that’s been largely influenced by day-traders betting on its survival. But the stock nearly halved on Tuesday, after the company announced it would sell a flood of new shares, which will dilute existing shareholders.Hudson Bay has underwritten the initial $225 million worth of shares that Bed Bath & Beyond is selling. It plans to underwrite another $800 million over time, if certain unspecified “conditions are met.” Hudson Bay also receives warrants to buy further stock at an advantageous price, which could prove lucrative if the retailer were to turn its business around.The deal with Hudson Bay came together within the past several weeks, two people familiar with the negotiations told DealBook. Late last month, JPMorgan Chase, which gave Bed Bath & Beyond a lifeline last summer by expanding its credit line, froze the retailer’s credit accounts after deeming the company in breach of the terms of its debt. As Bed Bath & Beyond raced to find cash to pay its debts, it had also been preparing for a bankruptcy — and possible liquidation — if the needed funds didn’t arrive.Whether this only buys Bed Bath & Beyond a temporary reprieve remains to be seen. “The fundamental story for Bed Bath & Beyond is so broken at this point,” said David Silverman, a retail analyst at Fitch Ratings. “I don’t know that a short-term cash infusion that could buy them a few months, a couple of quarters, is going to change their fate.” The Wedbush Securities analyst Seth Basham seconded that opinion, cutting the stock price target to zero.“U.S. hog farmers look at the pictures of those farms in China, and they just scratch their heads and say, ‘We would never dare do that.’” — Brett Stuart, founder of the research firm Global AgriTrends, is worried about disease risks from China’s high-density pig farms, which in some cases pack the animals into tower blocks.Adam Neumann opens up about his next act Since leaving WeWork, Adam Neumann has (largely) kept quiet about his future plans, including Flow, a venture that Andreessen Horowitz invested $350 million in last year. But he is finally revealing more about the start-up, via a talk he gave to an Andreessen Horowitz-organized conference in November.The main — if still vague — takeaway is that Flow owns and operates apartment buildings that aim to persuade tenants to stay longer by making them “feel” as if they’re owners rather than renters. (How is left unsaid.) Mr. Neumann used plumbing to illustrate the business advantages of this approach, according to Bloomberg:An important element of the business proposition is that renters who stay longer are more profitable, Neumann said. His theory is that people who feel a sense of ownership will stick around.The plunger factor would be an added benefit for Flow. “If you’re in an apartment building and you’re a renter and your toilet gets clogged, you call the super,” he said. “If you’re in your own apartment, and you bought it and you own it and your toilet gets clogged, you take the plunger.” That’s the difference, he said, “when feeling like you own something.”THE SPEED READ DealsApollo is reportedly in talks to buy a stake in CS First Boston, the investment bank that will be spun out of Credit Suisse. (WSJ)Carlyle is said to be in negotiations to buy Cotiviti, a health care tech company, from Veritas Capital for nearly $15 billion. (Bloomberg)Oaktree Capital and other hedge funds have snapped up Adani Group bonds in recent days, restoring investor confidence in the beleaguered Indian conglomerate. (Bloomberg)PolicyMarty Walsh, the U.S. labor secretary, reportedly will step down to lead the N.H.L. players’ union. (Daily Faceoff)Senator Josh Hawley, Republican of Missouri, said he wants to make 16 the minimum age to be allowed on social media in the U.S. (NBC News)Russia’s government is said to be pressuring the central bank to loosen fiscal policy as it enters the second year of its invasion of Ukraine. (Bloomberg)Best of the restAmerican start-ups laid off over 3,000 workers last month, up 1,700 percent from a year ago. Relatedly, Washington now has more tech vacancies than Silicon Valley. (Insider, WSJ)“The Secret Saudi Plan to Buy the World Cup.” (Politico)Voice actors say they’re increasingly being asked to sign away the rights to their voices — so they can be duplicated by A.I. (Vice)How Nestlé’s bet on a breakthrough treatment for peanut allergies went south. (Bloomberg Businessweek)LeBron James now owns the N.B.A.’s scoring record. (NYT)We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com. More

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      George Santos Is In a Class of His Own. But Other Politicians Have Embellished Their Resumes, Too.

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      Mr. Santos, a Republican representative-elect from Long Island, has admitted to lying about his professional background, educational history and property ownership.With his admission this week that he lied to voters about his credentials, Representative-elect George Santos has catapulted to the top of the list of politicians who have misled the public about their past.Mr. Santos, a New York Republican, fabricated key biographical elements of his background, including misrepresentations of his professional background, educational history and property ownership, in a pattern of deception that was uncovered by The New York Times. He even misrepresented his Jewish heritage.While others have also embellished their backgrounds, including degrees and military honors that they did not receive or distortions about their business acumen and wealth, few have done so in such a wide-ranging manner.Many candidates, confronted over their inconsistencies during their campaigns, have stumbled, including Herschel Walker and J.R. Majewski, two Trump-endorsed Republicans who ran for the Senate and the House during this year’s midterms.Mr. Walker, who lost Georgia’s Senate runoff this month, was dogged by a long trail of accusations that he misrepresented himself. Voters learned about domestic violence allegations, children born outside his marriage, ex-girlfriends who said he urged them to have abortions and more, including questions about where he lived, his academic record and the ceremonial nature of his work with law enforcement.Mr. Majewski promoted himself in his Ohio House race as a combat veteran who served in Afghanistan after the Sept. 11, 2001, terrorist attacks, but the U.S. Air Force had no record that he served there. He lost in November.Some of the nation’s most prominent presidential candidates have been accused of misrepresenting themselves to voters as well; perhaps none more notably than Donald J. Trump, whose 2016 campaign hinged on a stark exaggeration of his business background. While not as straightforward a deception as Mr. Santos saying he worked somewhere he had not, Mr. Trump presented himself as a successful, self-made businessman and hid evidence he was not, breaking with decades of precedent in refusing to release his tax records. Those records, obtained by The Times after his election, painted a much different picture — one of dubious tax avoidance, huge losses and a life buttressed by an inherited fortune.Prominent Democrats have faced criticisms during presidential campaigns too, backtracking during primary contests after being called out for more minor misrepresentations:Joseph R. Biden Jr. admitted to overstating his academic record in the 1980s: “I exaggerate when I’m angry,” he said at the time. Hillary Clinton conceded that she “misspoke” in 2008 about dodging sniper fire on an airport tarmac during a 1996 visit to Bosnia as first lady, an anecdote she employed to highlight her experience with international crises. And Senator Elizabeth Warren apologized in 2019 for her past claims of Native American ancestry.Most politicians’ transgressions pale in comparison with Mr. Santos’s largely fictional résumé. Voters also didn’t know about his lies before casting their ballots.The Spread of Misinformation and FalsehoodsCovid Myths: Experts say the spread of coronavirus misinformation — particularly on far-right platforms like Gab — is likely to be a lasting legacy of the pandemic. And there are no easy solutions.Midterms Misinformation: Social media platforms struggled to combat false narratives during the 2022 U.S. midterm elections, but it appeared most efforts to stoke doubt about the results did not spread widely.A ‘War for Talent’: Seeing misinformation as a possibly expensive liability, several companies are angling to hire former Twitter employees with the expertise to keep it in check. A New Misinformation Hub?: Misleading edits, fake news stories and deepfake images of politicians are starting to warp reality on TikTok.Here are some other federal office holders who have been accused of being less than forthright during their campaigns, but got elected anyway.Representative Madison Cawthorn, who lost his primary this year, was elected in 2020 despite a discrepancy over his plans to attend the Naval Academy.Logan R. Cyrus for The New York TimesMadison Cawthorn’s 2020 House campaignMadison Cawthorn became the youngest member of the House when he won election in 2020, emerging as the toast of the G.O.P. and its Trump wing. North Carolina voters picked him despite evidence that his claim that the 2014 auto accident that left him partly paralyzed had “derailed” his plans to attend the Naval Academy was untrue.Reporting at the time showed that the Annapolis application of Mr. Cawthorn, who has used a wheelchair since the crash, had previously been rejected. Mr. Cawthorn has declined to answer questions from the news media about the discrepancy or a report that he acknowledged in a 2017 deposition that his application had been denied. A spokesman for Mr. Cawthorn did not immediately respond to a request for comment.Mr. Cawthorn, whose term in Congress was marked by multiple scandals, lost the G.O.P. primary in May to Chuck Edwards, a three-term state senator who represents the Republican old guard.Andy Kim’s 2018 House campaignAndy Kim, a Democrat who represents a New Jersey swing district, raised eyebrows during the 2018 campaign when his first television ad promoted him as “a national security officer for Republican and Democratic presidents.”While Mr. Kim had worked as a national security adviser under President Barack Obama, his claim that he had filled a key role in the administration of former President George W. Bush was not as ironclad.A Washington Post fact check found that Mr. Kim had held an entry-level job for five months as a conflict management specialist at the U.S. Agency for International Development.Mr. Kim’s campaign manager at the time defended Mr. Kim, telling The Post that he played a key role as a public servant during the Bush administration that involved working in the agency’s Africa bureau on issues like terrorism in Somalia and genocide in Sudan.Voters did not appear to be too hung up about the claims of Mr. Kim, who last month was elected to a third term in the House.During the 2010 Senate campaign, Senator Marco Rubio described being the son of Cuban immigrants who fled Fidel Castro, but his parents moved to the United States before Castro returned to Cuba.Steve Johnson for The New York TimesMarco Rubio’s 2010 Senate campaignMarco Rubio vaulted onto the national political stage in the late 2000s after a decade-long rise in the Florida Legislature, where he served as House speaker. Central to his ascent and his 2010 election to the Senate was his personal story of being the son of Cuban immigrants, who Mr. Rubio repeatedly said had fled during Fidel Castro’s revolution.But Mr. Rubio’s account did not square with history, PolitiFact determined. In a 2011 analysis, the nonpartisan fact-checking website found Mr. Rubio’s narrative was false because his parents had first moved to the United States in 1956, which was before Castro had returned to Cuba from Mexico and his takeover of the country in 1959.Mr. Rubio said at the time that he had relied on the recollections of his parents, and that he had only recently learned of the inconsistencies in the timeline. He was re-elected in 2016 and again in November.Mark Kirk’s 2010 and 2016 Senate campaignsMark Kirk, who was a five-term House member from Illinois, leaned heavily on his military accomplishments in his 2010 run for the Senate seat once held by Barack Obama. But the Republican’s representation of his service proved to be deeply flawed.Mr. Kirk’s biography listed that he had been awarded the “Intelligence Officer of the Year” while in the Naval Reserve, a prestigious military honor that he never received. He later apologized, but that was not the only discrepancy in his military résumé.In an interview with the editorial board of The Chicago Tribune, Mr. Kirk accepted responsibility for a series of misstatements about his service, including that he had served in the Persian Gulf war of 1991, that he once commanded the Pentagon war room and that he came under fire while flying intelligence missions over Iraq.Mr. Kirk attributed the inaccuracies as resulting from his attempts to translate “Pentagonese” for voters or because of inattention by his campaign to the details of his decades-long military career.Still, Illinois voters elected Mr. Kirk to the Senate in 2010, but he was defeated in 2016 by Tammy Duckworth, a military veteran who lost her legs in the Iraq war. In that race, Mr. Kirk’s website falsely described him as an Iraq war veteran.Richard Blumenthal was a Marine Corps reservist during the Vietnam War, but did not enter combat, as he had suggested.Christopher Capozziello for The New York TimesRichard Blumenthal’s 2010 Senate campaignRichard Blumenthal, a Connecticut Democrat, misrepresented his military service during the Vietnam War, according to a Times report that rocked his 2010 campaign.Mr. Blumenthal was a Marine Corps reservist but did not enter combat. After the report, he said that he never meant to create the impression that he was a combat veteran and apologized. Mr. Blumenthal insisted that he had misspoken, but said that those occasions were rare and that he had consistently qualified himself as a reservist during the Vietnam era.The misrepresentation did not stop Mr. Blumenthal, Connecticut’s longtime attorney general, from winning the open-seat Senate race against Linda McMahon, the professional wrestling mogul. She spent $50 million in that race and later became a cabinet member under Mr. Trump, who has repeatedly zeroed in on Mr. Blumenthal’s military record.Wes Cooley’s 1994 House campaignWes Cooley, an Oregon Republican, had barely established himself as a freshman representative when his political career began to nosedive amid multiple revelations that he had lied about his military record and academic honors.His problems started when he indicated on a 1994 voters’ pamphlet that he had seen combat as a member of the Army Special Forces in Korea. But the news media in Oregon reported that Mr. Cooley had never deployed for combat or served in the Special Forces. Mr. Cooley was later convicted of lying in an official document about his military record and placed on two years of probation.The Oregonian newspaper also reported that he never received Phi Beta Kappa honors, as he claimed in the same voters’ guide. He also faced accusations that he lied about how long he had been married so that his wife could continue collecting survivor benefits from a previous husband.Mr. Cooley, who abandoned his 1996 re-election campaign, died in 2015. He was 82.Kirsten Noyes More

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      George Santos: What We Know and Don’t Know About the Representative-Elect

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      Mr. Santos admitted that the information in his résumé about where he worked and went to school was not true. Other discrepancies in his biography remain a mystery.For a week, Representative-elect George Santos avoided answering questions from the media, after The New York Times reported several notable fabrications on his résumé.Now, Mr. Santos has swapped out silence for a new tactic: creating the appearance of coming clean.In three separate interviews — two of them with conservative media, none with The Times — Mr. Santos has admitted to “embellishing” his résumé, even as he has denounced “elitist” institutions seeking to hold him to account and suggested that he is no more duplicitous than your average member of Congress.‘Did I embellish my résumé? Yes, I did,” he told City & State, a New York political publication. “And I’m sorry, and it shouldn’t be done. And words can’t express 100 percent how I feel, but I’m still the same guy. I’m not a fraud. I’m not a cartoon character. I’m not some mythical creature that was invented.”Voters from New York’s Third Congressional District, which encompasses parts of Nassau County and Queens, elected Mr. Santos, 34, a Republican, in November. When he enters Congress in 2023, several important unanswered questions will still hang over him.Here is what we do and do not know about the representative-elect.Mr. Santos did not work where he said he did.Over the course of his two campaigns for Congress, the first of which was unsuccessful, Mr. Santos cast himself as an accomplished veteran of Wall Street, with work experience at both Citigroup, where he said he was “an associate asset manager,” and at Goldman Sachs. Both firms told The Times that they had no record of Mr. Santos’s ever working for them.In recent interviews, Mr. Santos has claimed that he did not actually work for those companies, but rather with them, when he was employed at a company called LinkBridge Investors, which says it connects fund managers with investors.Mr. Santos told The New York Post that he had merely used a “poor choice of words.”Mr. Santos did not graduate from the schools he said he had.Mr. Santos has said he graduated from Baruch College in Manhattan with a bachelor’s degree in economics and finance. A biography on the website of the House Republicans’ campaign committee said he had also studied at N.Y.U. But neither college could find records verifying those claims, and in his interview with The Post, Mr. Santos admitted that he had lied about his education.“I didn’t graduate from any institution of higher learning.” he told the newspaper. “I’m embarrassed and sorry for having embellished my résumé.”Mr. Santos says he is not Jewish, so much as “Jew-ish.”Mr. Santos has said that his mother was born in Brazil to immigrants who “fled Jewish persecution in Ukraine, settled in Belgium and again fled persecution during WW II.” And he has identified as both Catholic and as a nonobservant Jew.But citing genealogy records and Brazilian records, both The Forward, a Jewish publication, and CNN have reported that Mr. Santos’s maternal grandparents appear to have been born in Brazil before World War II. Mr. Santos has responded to those revelations by modifying his story ever so slightly.“I always joke, I’m Catholic, but I’m also Jew-ish — as in ‘ish,’” he told City & State. “I grew up fully aware that my grandparents were Jewish, came from a Jewish family, and they were refugees to Brazil. And that was always the story I grew up with, and I’ve always known it very well.”Mr. Santos amends story on Pulse nightclub shooting.After he won election, Mr. Santos, who says he is gay, claimed to have “lost four employees” at the 2016 shooting at Pulse, a gay club in Orlando, a claim for which The Times could find no evidence.During an interview on WABC radio, Mr. Santos said that those “four employees” did not actually work for his Florida company. Rather, those four individuals were in the process of being hired, he said.“We did lose four people that were going to be coming to work for the company that I was starting up in Orlando,” he said.Mr. Santos denied committing any crimes.Contrary to records unearthed by The Times, Mr. Santos has seemed to insist that he was never charged with fraud for writing checks with a stolen checkbook in Brazil.“I am not a criminal here — not here or in Brazil or any jurisdiction in the world,” he told The Post. “Absolutely not. That didn’t happen.”In the radio interview with WABC, Mr. Santos offered to provide documents to corroborate his assertion. But he declined to provide any documentation to The Times.Mr. Santos does not own 13 properties.During his most recent congressional campaign, Mr. Santos cast himself and his family as the owners of 13 properties. He also suggested he was a beleaguered landlord whose tenants were unjustly withholding rent.On Monday, he said his family owns property, but he does not.“George Santos does not own any properties,” he told The Post.The sources of Mr. Santos’s $700,000 campaign loan remain unclear.Though Mr. Santos’s adulthood has been marked by a trail of unpaid debts to landlords and creditors, in 2021 and 2022, he lent $700,000 to his congressional campaign, according to federal campaign finance documents. It remains unclear where that money came from.Mr. Santos continues to claim it originated with his work at The Devolder Organization, which he described as a consulting firm to City & State.Mr. Santos has disclosed little about the operations of his company, and The Times could find no property or public-facing assets linked to the firm. More

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      George Santos Admits to Lying About College and Work History

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      The congressman-elect confirmed The New York Times’s findings that he had not graduated from college or worked at two major Wall Street companies, as he had claimed.Ending a weeklong silence, Representative-elect George Santos admitted on Monday to a sizable list of misrepresentations about his professional background, educational history, business experience and property ownership. But he said he was determined to take the oath of office on Jan. 3 and join the House majority.Mr. Santos, a New York Republican who was elected in November to represent parts of northern Long Island and northeast Queens, confirmed some of the key findings of a New York Times investigation into his background, but sought to minimize the falsehoods.“My sins here are embellishing my résumé,” Mr. Santos told The New York Post in one of two interviews he granted on Monday.Mr. Santos admitted to lying about graduating from college and making misleading claims that he worked for Citigroup or Goldman Sachs. He once said he had a family-owned real estate portfolio of 13 properties; on Monday, he admitted he was not a landlord.Mr. Santos, the first openly gay Republican to win a House seat as a non-incumbent, also acknowledged owing thousands in unpaid rent and a yearslong marriage he had never disclosed.“I dated women in the past. I married a woman. It’s personal stuff,” he said to The Post, adding that he was “OK with my sexuality. People change.”In the interviews, Mr. Santos also firmly rejected having committed a crime anywhere in the world, despite the existence of Brazilian court records that show he admitted to committing check fraud there.“I am not a criminal here — not here or in Brazil or any jurisdiction in the world,” he told The Post. “Absolutely not. That didn’t happen.”The admissions by Mr. Santos added a new wrinkle to one of the more astonishing examples of an incoming congressman falsifying key biographical elements of his background — with Mr. Santos maintaining the falsehoods through two consecutive bids for Congress, the first of which he lost.In both interviews, Mr. Santos also denounced reporting by both CNN and The Forward, a Jewish publication, that he may have misled voters about his account of his Jewish ancestry, including that his maternal grandparents were born in Europe and emigrated to Brazil during the Holocaust.The Aftermath of the 2022 Midterm ElectionsCard 1 of 6A moment of reflection. More

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      New York Republican George Santos’s Résumé Called Into Question

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      Mr. Santos, a Republican from New York, says he’s the “embodiment of the American dream.” But he seems to have misrepresented a number of his career highlights.George Santos, whose election to Congress on Long Island last month helped Republicans clinch a narrow majority in the House of Representatives, built his candidacy on the notion that he was the “full embodiment of the American dream” and was running to safeguard it for others.His campaign biography amplified his storybook journey: He is the son of Brazilian immigrants, and the first openly gay Republican to win a House seat as a non-incumbent. By his account, he catapulted himself from a New York City public college to become a “seasoned Wall Street financier and investor” with a family-owned real estate portfolio of 13 properties and an animal rescue charity that saved more than 2,500 dogs and cats.But a New York Times review of public documents and court filings from the United States and Brazil, as well as various attempts to verify claims that Mr. Santos, 34, made on the campaign trail, calls into question key parts of the résumé that he sold to voters.Citigroup and Goldman Sachs, the marquee Wall Street firms on Mr. Santos’s campaign biography, told The Times they had no record of his ever working there. Officials at Baruch College, which Mr. Santos has said he graduated from in 2010, could find no record of anyone matching his name and date of birth graduating that year.There was also little evidence that his animal rescue group, Friends of Pets United, was, as Mr. Santos claimed, a tax-exempt organization: The Internal Revenue Service could locate no record of a registered charity with that name.His financial disclosure forms suggest a life of some wealth. He lent his campaign more than $700,000 during the midterm election, has donated thousands of dollars to other candidates in the last two years and reported a $750,000 salary and over $1 million in dividends from his company, the Devolder Organization.Yet the firm, which has no public website or LinkedIn page, is something of a mystery. On a campaign website, Mr. Santos once described Devolder as his “family’s firm” that managed $80 million in assets. On his congressional financial disclosure, he described it as a capital introduction consulting company, a type of boutique firm that serves as a liaison between investment funds and deep-pocketed investors. But Mr. Santos’s disclosures did not reveal any clients, an omission three election law experts said could be problematic if such clients exist.And while Mr. Santos has described a family fortune in real estate, he has not disclosed, nor could The Times find, records of his properties. Mr. Santos’s eight-point victory, in a district in northern Long Island and northeast Queens that previously favored Democrats, was considered a mild upset. He had lost decisively in the same district in 2020 to Tom Suozzi, then the Democratic incumbent, and had seemed to be too wedded to former President Donald J. Trump and his stances to flip his fortunes.His appearance earlier this month at a gala in Manhattan attended by white nationalists and right-wing conspiracy theorists underscored his ties to Mr. Trump’s right-wing base.At the same time, new revelations uncovered by The Times — including the omission of key information on Mr. Santos’s personal financial disclosures, and criminal charges for check fraud in Brazil — have the potential to create ethical and possibly legal challenges once he takes office.Mr. Santos did not respond to repeated requests from The Times that he furnish either documents or a résumé with dates that would help to substantiate the claims he made on the campaign trail. He also declined to be interviewed, and neither his lawyer nor Big Dog Strategies, a Republican-oriented political consulting group that handles crisis management, responded to a detailed list of questions.The lawyer, Joe Murray, said in a short statement that it was “no surprise that Congressman-elect Santos has enemies at The New York Times who are attempting to smear his good name with these defamatory allegations.”A New U.S. Congress Takes ShapeFollowing the 2022 midterm elections, Democrats maintained control of the Senate while Republicans flipped the House.McCarthy’s Fraught Speaker Bid: Representative Kevin McCarthy has so far been unable to quash a mini-revolt on the right that threatens to imperil his effort to secure the top House job.Kyrsten Sinema: The Arizona senator said that she would leave the Democratic Party and register as an independent, just days after the Democrats secured an expanded majority in the Senate.A Looming Clash: Congressional leaders have all but abandoned the idea of acting to raise the debt ceiling before Democrats lose control of the House, punting the issue to a new Congress.First Gen Z Congressman: In the weeks after his election, Representative-elect Maxwell Frost of Florida, a Democrat, has learned just how different his perspective is from that of his older colleagues.A criminal case in BrazilMr. Santos has said he was born in Queens to parents who emigrated from Brazil and was raised in the borough. His father, he has said, is Catholic and has roots in Angola. His mother, Fatima Devolder, was descended from migrants who fled Jewish persecution in Ukraine and World War II strife in Belgium. Mr. Santos has described himself as a nonobservant Jew but has also said he is Catholic.Records show that Mr. Santos’s mother, who died in 2016, lived for a time in the Brazilian city of Niterói, a Rio suburb where she was employed as a nurse. After Mr. Santos obtained a high school equivalency diploma, he apparently also spent some time there.In 2008, when Mr. Santos was 19, he stole the checkbook of a man his mother was caring for, according to Brazilian court records uncovered by The Times. Police and court records show that Mr. Santos used the checkbook to make fraudulent purchases, including a pair of shoes. Two years later, Mr. Santos confessed to the crime and was later charged.The court and local prosecutor in Brazil confirmed the case remains unresolved. Mr. Santos did not respond to an official summons, and a court representative could not find him at his given address, records show.That period in Brazil overlapped with when Mr. Santos said he was attending Baruch College, where he has said he was awarded a bachelor’s degree in economics and finance. But Baruch College said it was unable to find records of Mr. Santos — using multiple variations of his first, middle and last names — having graduated in 2010, as he has claimed.A biography of Mr. Santos on the website of the National Republican Congressional Committee, which is the House Republicans’ campaign arm, also includes a stint at New York University. The claim is not repeated elsewhere, and an N.Y.U. spokesman found no attendance records matching his name and birth date.Mr. Santos, appearing with other Republican elected officials at a post-Election Day news conference, has declined to address questions about his biography.Alejandra Villa Loarca/Newsday, via Getty ImagesAfter he said he graduated from college, Mr. Santos began working at Citigroup, eventually becoming “an associate asset manager” in the company’s real estate division, according to a version of his biography that was on his campaign site as recently as April.A spokeswoman for Citigroup, Danielle Romero-Apsilos, said the company could not confirm Mr. Santos’s employment. She also said she was unfamiliar with Mr. Santos’s self-described job title and noted that Citi had sold off its asset management operations in 2005.A previous campaign biography of Mr. Santos indicates that he left Citi to work at a Turkey-based hospitality technology company, MetGlobal, and other profiles mention a brief role at Goldman Sachs. MetGlobal executives could not be reached for comment. Abbey Collins, a spokeswoman at Goldman Sachs, said she could not locate any record of Mr. Santos’s having worked at the company.Attempts to find co-workers who could confirm his employment were unsuccessful, in part because Mr. Santos has not provided specific dates for his time at these companies.He has also asserted that his professional life had intersected with tragedy: He said in an interview on WNYC that his company, which he did not identify, “lost four employees” at the Pulse nightclub shooting in Orlando in June 2016. But a Times review of news coverage and obituaries found that none of the 49 victims appear to have worked at the various firms named in his biography.After two evictions, a reversal of fortunesAs he was purportedly climbing the corporate ranks, Mr. Santos claimed to have founded Friends of Pets United, which he ran for five years beginning in 2013. As a candidate, he cited the group as proof of a history of philanthropic work.Though remnants of the group and its efforts could be found on Facebook, the I.R.S. was not able to find any record showing that the group held the tax-exempt status that Mr. Santos claimed. Neither the New York nor New Jersey attorney general’s offices could find records of Friends of Pets United having been registered as a charity.Friends of Pets United held at least one fund-raiser with a New Jersey animal rescue group in 2017; the invitation promised drinks, donated raffle items and a live band. Mr. Santos charged $50 for entry, according to an online fund-raising page that promoted the event. But the event’s beneficiary, who asked for anonymity for fear of retribution, said that she never received any of the funds, with Mr. Santos only offering repeated excuses for not forwarding the money.During that same period, Mr. Santos was also facing apparent financial difficulties. In November 2015, a landlord in the Whitestone neighborhood of Queens filed an eviction suit in housing court accusing Mr. Santos of owing $2,250 in unpaid rent.The landlord, Maria Tulumba, said in an interview that Mr. Santos had been a “nice guy” and a “respectful” tenant. But she said that he had financial problems that led to the eviction case, declining to elaborate further. The judge ruled in favor of Ms. Tulumba.In May 2017, Mr. Santos faced another eviction case, from a rent-stabilized apartment in Sunnyside, Queens. Mr. Santos’s landlord accused him of owing more than $10,000 in rent stretching over five months and said in court records that one of his tenant’s checks had bounced. A warrant of eviction was issued, and Mr. Santos was fined $12,208 in a civil judgment.By early 2021, Mr. Santos was becoming vocal on housing issues but not from a tenant perspective. During New York’s pandemic-era eviction moratorium, Mr. Santos said on Twitter that he was a landlord affected by the freeze.“Will we landlords ever be able to take back possession of our property?” he wrote.Mr. Santos said that he and his family had not been paid rent on their 13 properties in nearly a year, adding that he had offered rental assistance to some tenants, but found that some were “flat out taking advantage of the situation.”But Mr. Santos has not listed properties in New York on required financial disclosure forms for either of his campaigns; the only real estate that he mentioned was an apartment in Rio de Janeiro. Property records databases in New York City and Nassau County did not show any documents or deeds associated with him, immediate family members or the Devolder Organization.It is unclear what might have led to Mr. Santos’s apparent reversal in fortunes. By the time he launched his first run for the House, in November 2019, Mr. Santos was working in business development at a company called LinkBridge Investors that says it connects investors with fund managers.Mr. Santos eventually became a vice president there, according to a company document and a May 2020 campaign disclosure form where he declared earnings of $55,000 in salary, commission and bonuses.Mr. Santos, campaigning before Election Day, captured the race for the Third Congressional District, a contest he lost in 2020. Mary Altaffer/Associated PressOver the next two years, Mr. Santos bounced between several ill-fated ventures. As he ran for Congress, he moved from LinkBridge to take on a new role as regional director of Harbor City Capital, a Florida-based investment company.Harbor City, which attracted investors with YouTube videos and guarantees of double-digit returns, soon garnered attention from the S.E.C., which filed a lawsuit accusing the company and its founder of running a $17 million Ponzi scheme. Neither Mr. Santos nor other colleagues were named in the lawsuit, and Mr. Santos has publicly denied having any knowledge of the scheme.Two weeks later, a handful of former Harbor City executives formed a company called Red Strategies USA, as reported by The Daily Beast. Corporate filings listed the Devolder Organization as a partial owner — even though the papers to register Devolder would not be filed for another week.Red Strategies was short lived: Federal campaign records show it did political consulting work for at least one politician — Tina Forte, a Republican who unsuccessfully challenged Representative Alexandria Ocasio-Cortez in November — before it was dissolved in September for failing to file an annual report.The Devolder Organization seems to have flourished as Mr. Santos ran for office. According to Mr. Santos’s disclosures, his work there earned him a salary of $750,000. By the time it too was dissolved — also for failing to file an annual report — Mr. Santos reported that it was worth more than a million dollars.A November win raises new questionsMr. Santos announced his intent to make a second run at Congress almost immediately after the end of his first. He figured to again be an underdog in the district, which largely favored President Biden in 2020.But things began to swing in his favor. Republicans in Nassau performed well in local elections in 2021. Mr. Suozzi opted to not run for re-election in 2022, instead launching an unsuccessful bid for governor. And with high turnout expected in a midterm election that also featured a governor’s race, Mr. Santos’s race became more competitive — and his campaign stance became more tempered.During his first campaign, Mr. Santos, an adherent of Mr. Trump, opposed mask mandates and abortion access, and defended law enforcement against what he called the “made-up concept” of police brutality.But during his second campaign, older posts on Twitter were suddenly deleted, including his claims of election fraud that he said cost Mr. Trump the election in 2020. In March 2021, he resurfaced the claim, writing on Twitter in a since-deleted post, “My new campaign team has 4 former loyal Trump staffers that pushed him over the finish line TWICE, yes I said TWICE!”Mr. Santos also briefly claimed without evidence in another since-deleted tweet that he had been a victim of fraud in his first congressional race, at one point using the hashtag #StopTheSteal, a reference to a slogan associated with Mr. Trump’s false election claims.And while he previously boasted that he attended the Jan. 6 rally (but, he has said, not the riot) in support of Mr. Trump in Washington, he has since ducked questions about his attendance and a prior claim that he had written “a nice check for a law firm” to assist some rioters with their legal bills.Mr. Santos’s improved circumstances are evident on the official financial disclosure form he filed in September with the House of Representatives, though the document still leaves questions about his finances.In the disclosure, Mr. Santos said that he was the Devolder Organization’s sole owner and managing member. He reported that the company, which is based in New York but was registered in Florida, paid him a $750,000 salary. He also earned dividends from Devolder totaling somewhere between $1 million and $5 million — even though Devolder’s estimated value was listed in the same range.The Devolder Organization has no public-facing assets or other property that The Times could locate. Mr. Santos’s disclosure form did not provide information about clients that would have contributed to such a haul — a seeming violation of the requirement to disclose any compensation in excess of $5,000 from a single source.Kedric Payne, the vice president of the watchdog Campaign Legal Center, and a former deputy chief counsel for the Office of Congressional Ethics, was one of three election law experts consulted by The Times who took issue with the lack of detail.“This report raises red flags because no clients are reported for a multimillion-dollar client services company,” Mr. Payne said, adding: “The congressman-elect should explain what’s going on.”The Times attempted to interview Mr. Santos at the address where he is registered to vote and that was associated with a campaign donation he made in October, but a person at that address said on Sunday that she was not familiar with him.Material omissions or misrepresentations on personal financial disclosures are considered a federal crime under the False Statements Act, which carries a maximum penalty of $250,000 and five years in prison. But the bar for these cases is high, given that the statute requires violations to be “knowing and willful.”The House of Representatives has several internal mechanisms for investigating ethics violations, issuing civil or administrative penalties when it does. Those bodies tend to act largely in egregious cases, particularly if the behavior took place before the member was inaugurated.Campaign disclosures show that Mr. Santos lived large as a candidate, buying shirts for his staff from Brooks Brothers and charging the campaign for meals at the restaurant inside Bergdorf Goodman.Mr. Santos also spent a considerable amount of money traveling — charging his campaign roughly $40,000 in flights to places that included California, Texas and Florida. All told, Mr. Santos spent more than $17,000 in Florida, mostly on restaurants and hotels, including at least one evening at the Breakers, a five-star hotel and resort in Palm Beach, three miles up the road from Mar-a-Lago, Mr. Trump’s private club and residence.Manuela Andreoni More