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In 2017, Blackstone — the world's largest private-equity firm, which usually caters to big institutions and the very wealthy — decided to give ordinary investors an opportunity to get in on the firm's magic. It created BREIT, a private fund that buys commercial real estate like warehouses and apartment buildings, and marketed it to everyday investors as an "all-weather strategy to build long-term wealth across market cycles."

And it was magic: By offering an annual dividend of about 4% in a world where interest rates were close to zero, BREIT quickly became a giant. At its peak in 2021, the fund was attracting as much as $3 billion a month in new investments. Today, BREIT boasts assets of $114 billion — about 8% of Blackstone's entire fee-earning assets — and has generated over $5 billion in management and performance fees.

But over the past two years, some investors have grown suspicious that BREIT isn't the rock-solid investment Blackstone claims it is. Since its inception, the fund says it has delivered an annualized net return of 10.5% — almost double an index of publicly traded REITs. Even as commercial real estate has been battered in the wake of the pandemic, BREIT has somehow managed to defy gravity, outperforming comparable funds by seemingly fantastic margins. In the fall of 2022, after the Fed's interest-rate increases began to shake the commercial real-estate market, investors began asking for their money back — more than $15 billion to date. Faced with a run on the fund, Blackstone cited a provision that allowed it to take its time refunding antsy investors — a decision that only served to further alarm the market. Shares in Blackstone tumbled by nearly 20%. Last year, BREIT failed to generate enough cash to cover its annual dividend.

In recent months, the fund has appeared to recover from the debacle. BREIT announced it was able to fulfill 100% of the repurchase requests it received in February, which had slowed to just under $1 billion. Amid the promise of a rebound, Blackstone's stock has regained almost 50% from its lows. "I believe we'll look back at 2023 as the cyclical bottom for our firm," Steve Schwarzman, Blackstone's CEO, told analysts at an earnings call in January.

But the rosy picture that Blackstone paints may not tell the whole story. In recent months I've spoken with veteran analysts, accountants, and investors who have come to believe that BREIT is essentially a house of cards. That's because the returns the fund claims it has delivered depend almost entirely on BREIT's own estimates, which skeptics believe are wildly inflated. What's more, when BREIT faced a flood of redemption requests from investors, it only fulfilled all those requests after raising cash from new investors — including one that received a sweetheart deal from Blackstone to invest in BREIT. "It is the absolute definition of a Ponzi scheme," said Nate Koppikar, who runs a hedge fund called Orso Partners that has shorted Blackstone's stock because of concerns over BREIT. Unless the real-estate market comes roaring back, analysts warn, BREIT could end up shrinking to a fraction of its current size, leaving the fund's investors holding the bag.

"Surveying some of the ways that Blackstone has misled investors over the past five months, we are more convinced than ever that BREIT is a bad investment created for the benefit of Blackstone," Craig McCann, a financial analyst who served as an economist at the Securities Exchange Commission, wrote last year. "Investors should not accept anything Blackstone and BREIT state as truthful."

It's impossible to know exactly how valuable BREIT is. Because the fund is not publicly traded, the market doesn't set its price per share — Blackstone does. You buy shares in BREIT based on your faith in Blackstone's investing brilliance and in the firm's account of its own performance. Investing in a private real-estate trust like BREIT is, ultimately, an exercise in trust.

BREIT's returns are based on a measure called net asset value, or NAV. That's supposed to be the value of all the assets the fund owns, minus its debt. Blackstone told Business Insider that it has an "incredibly rigorous valuation process" — one it says has led it to adjust its NAV more aggressively than other REITS. But BREIT doesn't let investors or regulators see some of the crucial assumptions that go into calculating its NAV. As BREIT's financial documents state, Blackstone "is ultimately and solely responsible for the determination of our NAV." The methods used to calculate it are "not prescribed by rules of the SEC or any other regulatory agency," and the NAV "is not audited by our independent registered public accounting firm."

Chilton Capital Management, which invests in publicly traded REITs, analyzed the way Blackstone adjusts the value of BREIT to reflect changes in the underlying real estate it owns. Rather than being "marked to market" every day — or every millisecond, like public REITS — Blackstone adjusts its NAV on a monthly basis. In today's volatile real-estate market, that means its stated value can lag way behind reality. "It inherently is a flawed process when prices are changing quickly," Chilton observes. "We refer to this imperfect appraisal process as 'mark to magic.'" In 2022, after the crash in commercial real estate, publicly traded REITs that own assets similar to BREIT's — multifamily housing and industrial buildings — have been selling at sharp discounts. But BREIT, by "marking to magic," has continued to claim far higher returns. Using a collection of market-based metrics, Chilton concluded last April that BREIT was overstating the value of its NAV by more than 55%.

McCann, who is now a principal at SLCG Economics Consulting, reached a similar conclusion. He calculated that the cumulative returns of other funds in the sectors in which BREIT is concentrated plunged by over 30% in 2022. Yet BREIT claimed that its value increased during the same period. In the dry language of market analysts, McCann called the fund's claims about its NAV "unreliable."

Blackstone considers such comparisons unfair. It insists that BREIT shouldn't be compared to publicly traded funds, which it argues are more volatile than private offerings. In a statement to BI, the firm insists that BREIT is able to outperform other funds for a simple reason: because it owns better assets than they do. BREIT's portfolio, Blackstone says, is "concentrated in the best performing sectors (data centers, logistics and student housing) and geographies (virtually no urban exposure)." Only 3% of BREIT's holdings are in office buildings, which have been ground zero for commercial real estate pain. The company points to its performance during the global financial crisis of 2008 as evidence of its ability to outperform its competitors during "periods of dislocation" and notes that it has sold $20 billion of real estate since the beginning of 2022, when interest rates began to rise, generating a profit of $4 billion.

"Not all real estate is created equal," BREIT boasted in a recent letter to stockholders, "and where you invest matters."

But Blackstone's principal claim — that sounder investments have led to higher returns — is difficult to square with the ongoing decline of commercial real estate. It's hard to fathom how BREIT could have bought so many properties at the height of the market and yet somehow been selective enough to have dodged all the post-pandemic downturns suffered by other funds. According to BREIT's own numbers, data centers and student housing make up only a small part of its portfolio. And many of the data centers Blackstone says have already created so much value for the fund aren't even up and running yet — they're still in development.

Publicly traded REITs, meanwhile, aren't the only ones marking down their assets. Bluerock Total Income + Real Estate, which has over $300 billion invested in a host of institutional real estate funds, has marked its NAV back to pre-pandemic levels — down more than 20% from its peak. Other major investors, unlike Blackstone, apparently don't see their real estate holdings as immune from the chaos buffeting the rest of the market.

Blackstone also argues in its marketing material that BREIT is better positioned than other real-estate funds because its balance sheet is "substantially hedged," meaning it has fixed-rate debt and derivatives in place that protect against rising interest rates. That's true — for the moment. But BREIT's future cash flows are, in fact, very sensitive to interest rates. At the end of last year, BREIT had $62 billion of debt secured by its properties, and it paid an effective interest rate of 4.3% that it locked in before rates spiked. But $47 billion of that debt will come due over the next four years — and if rates stay elevated, BREIT could face over $1 billion in added interest costs. That, BREIT has warned investors, "could reduce our cash flows and our ability to make distributions to you." Investing in BREIT is essentially a bet that interest rates are going to fall — because if they don't, it could be ruinous.

You might argue that it ultimately doesn't matter if BREIT is overvaluing its NAV. As long as investors keep getting their hefty annual dividends, who cares? That's basically the same argument that Donald Trump made in defending himself against charges of systematically overstating his assets — that everybody made money, so no one was defrauded. But miscalculating the value of a vehicle like BREIT inflates the fees investors pay for participating in the fund while simultaneously depriving them of the opportunity to accurately assess the risk they're taking. In addition, Blackstone is incentivized to overvalue its NAV, because that's the number it uses to calculate the management and performance fees that investors pay. "It's a text-book example of conflict of interests," Robert Chang, the head of securities litigation at Fideres, a consulting firm that specializes in investigating corporate wrongdoing, wrote in a piece about BREIT. Fideres calculates that since early 2022, the fund's NAV per share has remained relatively stable — while public REITs have lost more than 30% of their value. If BREIT's assets are indeed overvalued, Fideres estimates, investors may have overpaid management and performance fees to the tune of hundreds of millions of dollars a year.

The alarm bells over BREIT go beyond whether Blackstone is overstating the fund's value. BREIT has said that through June of last year, 100% of its dividends were funded by cash flows from operations — the money produced by its real-estate assets. But that claim is more than a little misleading. In the measure of cash that BREIT highlights, it doesn't subtract the expenditures required to maintain its properties, which is standard for the industry. In its own fine print, in fact, BREIT does provide several other measures that are more analogous to how most REITS define cash flow; by those measures, the fund has never been able to cover its dividend from its cash flow.

No one I spoke with believes that Blackstone set out to build a house of cards. Rather, they say, BREIT was a victim of its own success.

In its response to BI, Blackstone argues that because its management fees are not paid in cash, they are "properly excluded" from some of its measures. But not being able to pay the dividend you've promised can be seen as a Ponzi-ish warning, because it means the money has to come from selling off assets, borrowing money, or attracting new investors — a reality that BREIT acknowledges on the third page of its financial documents (and one that the SEC has noted as a risk factor for all private REITS). And if you subtract Blackstone's fees, BREIT has covered less than 50% of its dividend distribution since its inception. Indeed, one of the primary reasons BREIT has been able to pay its dividends is because roughly half of all shareholders have elected to receive their dividends not in cash, but in more shares of BREIT. In other words, the game depends on the continued belief of investors — on their willingness to accept shares of BREIT in lieu of cash.

Getting paid in shares, of course, is not the same as getting paid in cash. The more shares BREIT issues to pay the dividend — and its fees to Blackstone — the less each share is worth. "On the surface, it all looks so safe," McCann tells BI. "You're getting 4% or so a year, and you think it looks like a bond, and you think the underlying investments are doing well. Only when you dig in do you figure out that even if you're taking cash, the money is a return of capital, not a return on capital."

In 2022, when investors started asking for their money back in droves, BREIT faced a big problem. If its assets weren't marked correctly, it couldn't sell them off to pay investors without fessing up. Then the fund got what looked like a vote of confidence. In January 2023, BREIT announced that the University of California had decided to invest $4 billion in the fund, giving it a much-needed infusion of cash. Schwarzman called the investment a "validation" of BREIT's strategy.

But it wasn't. To entice the university to invest, Blackstone had offered it a special deal. BREIT agreed to award the university an additional $1 billion in stock in the event that the fund's rate of return fell below 11.25%. The deal was so sweet that UC's Board of Regents quickly agreed to invest another $500 million on the same terms.

"Contrary to Blackstone's spin," wrote McCann, "the University of California investment strongly supports the view that BREIT is a terrible investment."

Scoring the new investment helped BREIT pay off all those who wanted to exit the fund, albeit slowly. And for the moment, the stampede appears to have subsided.

Blackstone says that BREIT has "access to ample liquidity across multiple sources," including "$119.1 billion of high-quality real estate that can be sold at market prices if we choose to do so." But if investors stage another rush for the doors, BREIT could face a serious reckoning, especially given its high level of debt. If it has overvalued its properties, as some experts suggest, then it will have to sell its assets at a price below where they are marked. And the more shareholders it has to redeem, the faster its equity will become worthless. Those who get their money out early will be OK. Those who are last in line, not so much.

"If BREIT has to sell properties to meet redemptions, and they have to dip deeper into their portfolio to sell less desirable properties, they'll have to mark their NAV to reflect the actual sales prices," says Phil Bak, the founder and CEO of Armada Investors, a quantitative asset manager that specializes in REITs. "That could scare the people who have been clinging to fund performance as a reason not to redeem, which in turn causes a death spiral."

No one I spoke with believes that Blackstone set out to build a house of cards. Rather, they say, BREIT was a victim of its own success. Money poured in at the height of the market, meaning that BREIT invested at a moment when commercial real estate was priced to perfection. Real estate, by its nature, is always somewhat illiquid — you can't sell your share of an apartment building on the stock market. And in a bad market, it's very illiquid, especially if what you own is marked at a price where no one will buy it. But while Blackstone says it designed BREIT so investors could get their money out, it seems not to have foreseen that scores of individual investors — unlike the big institutions that have typically been its clients, who are forced to commit their funds for long periods of time — might get spooked enough to ask for their money back all at the same time. Titans of Wall Street often believe that their brilliance should insulate them from skepticism. Their supreme confidence in their own wisdom is perhaps their most marketable asset.

It's completely possible, of course, that BREIT will survive, no matter how flawed its model might be. If the real-estate market reignites, that will boost the value of the assets in funds like BREIT. And if enough new investors are willing to place bets on BREIT — if trust in Blackstone's "magic" remains high — then everyone will keep making money, if only on paper, even if BREIT is overvaluing its assets. Blackstone's success has already created at least three billionaires, chief among them its CEO, Steve Schwarzman, who is worth almost $40 billion. The ability to enrich yourself seems to be a key part of what inspires others to follow your investment advice.

But there are plenty of warning signs that things could get worse. It's unlikely that the market will pick up fast enough to offset BREIT's woes. "Commercial real estate is a slow burn," Brian Moynihan, the CEO of Bank of America, recently observed. In its financial statements, Blackstone says it continues to count on "high single-digit growth" in its two biggest sectors, rental housing and industrial properties. But BREIT's overall growth was just 6% last year, and it has been decelerating quarter over quarter. If the market continues to fall, it will be harder for BREIT to claim it's the shining exception.

To make matters worse, the way BREIT is structured could prove to be a ticking time bomb. Like other private vehicles, BREIT pays hefty commissions to financial advisors who steer their clients to the fund. All told, Blackstone has paid Wall Street banks and brokers more than $700 million in brokerage fees. But for brokers who put their clients in BREIT early on, those commissions could soon hit a mandated cap of 8.75% — meaning they'll no longer be incentivized to sell the fund. If they start advising their clients to exit BREIT, it could spur an even bigger rush for the doors.

The future of BREIT could also send shock waves through Blackstone's bottom line. In 2022 alone, SLCG calculated, fees from BREIT generated 13.3% of Blackstone's total management fees and 12.6% of its performance revenue. If BREIT and its sister fund, BPP, are forced to slash their NAVs by 50%, the ensuing reduction in fees would wipe out over 15% of Blackstone's fee-related earnings — earnings that Wall Street, in contrast, is expecting will grow by 15%. According to Blackstone's financial statements, it's already anticipating it will have to pay the University of California $564 million in BREIT stock — an expense it doesn't count in the numbers it highlights to Wall Street. If BREIT craters, it will also be difficult for Blackstone to live up to Wall Street's expectations for its long-term earnings growth, which depend in part on its successful expansion into the retail market.

There are bigger issues at stake than Blackstone's bottom line. It's worth remembering, as Chilton notes, that private funds like BREIT were among "the biggest losers" during the global financial crisis of 2008. But that lesson seems lost on today's investors, who have once again flocked to private real-estate funds in a time of extreme market volatility. In the two years after the pandemic hit, private funds like BREIT raised $67 billion — far more than they drummed up in the two years leading up to the Great Recession. "While the tombstones may have different names on them," Chilton observes, "the reasons for the demise of private equity real estate players are going to rhyme, and possibly mirror those from the global financial crisis."

That's why the story of BREIT involves more than profits and losses. It's only recently that private-equity firms like Blackstone have started offering products to ordinary investors. "BREIT was a test case for the whole industry," says Koppikar, of Orso Partners. Perhaps, given the questions swirling around BREIT, it's time to rethink whether the world's wealthiest funds should be trusted to take billions of dollars in fees from ordinary investors without more oversight. As it stands, it's impossible to know what BREIT's assets are actually worth — and therein lies the problem. In the absence of a market price, independent accounting and tighter government regulation are needed to ensure that investors have the accurate, verifiable numbers they need to make informed decisions. With private funds like BREIT, too much maneuvering takes place in the dark. And if history is any lesson, the dark is a very bad place to be doing business.

Bethany McLean is a special correspondent at Business Insider.

• Conflict in the Middle East is a threat to Saudi Arabia's ambitious Vision 2030 plans.
• Some Neom projects are located along the Red Sea coast, where tensions have been escalating.
• The renewed conflict in the region has left Saudi officials walking a difficult political line.

Escalating tensions in the Middle East are threatening the success of Saudi Arabia's ambitious Vision 2030 plans — especially its desert megacity called Neom.

The kingdom has announced grand plans to boost its tourism industry to 150 million visitors a year by 2030, aiming to build new resorts and cities that will act as Dubai-style travel hubs in the region.

But many of these planned tourist destinations are located on the Red Sea coast, where tensions have been escalating since the October 7 Hamas attacks on Israel and the subsequent conflict in Gaza and beyond.

Iran-backed Houthis have launched numerous missiles and armed drone attacks at Israel and the threat of ongoing conflict has disrupted Red Sea shipping routes, with companies opting to avoid the area.

The conflict in the region has left Saudi officials walking a political tightrope.

Earlier steps toward normalizing relations with Israel have been derailed by a resurgence of local support for the Palestinian cause, while the threat of prolonged conflict risks hobbling officials lofty goals for Neom.

A de-escalating force

Before the October Hamas attacks, Saudi Arabia already appeared to be seeking de-escalation and normalization with its foreign policy in the region.

In March 2023, Iran and Saudi Arabia brokered a deal to re-establish diplomatic relations. With some help from China, the two nations agreed to reopen their embassies in their respective capitals.

In the months before October 7, Saudi Arabia was also reportedly edging toward a deal with the US that would have included a normalization agreement with Israel. According to a New York Times report, one reason is that it's hoping for a US security guarantee if it's ever attacked by Iran.

Progress on the deal appeared to stall after the Israeli offensive in Gaza sparked anger across the region, leaving Saudi officials caught between a wave of local support for the Palestinian cause and US pressure to normalize ties with Israel.

While Saudi Arabia has called for an end to the war in Gaza and accused Israel of committing war crimes, officials have continued to express interest in normalizing relations with the Jewish homeland as long as any deal includes the creation of a Palestinian state.

The US and Saudi Arabia are in the final steps of a new agreement on security guarantees and civilian nuclear assistance, Reuters reported last week. Normalization of an Israeli-Saudi relations is still far from being agreed.

International optics

The conflict in the region poses a problem for Saudi's hopes of attracting millions of new foreign visitors.

Kristian Coates Ulrichsen, a fellow for the Middle East at Rice University's Baker Institute for Public Policy, told Business Insider: "The Saudis are so concerned about any potential escalation because they realize they have this largely untapped Red Sea coastline, which they are now developing and see a lot of potential in."

Many of Neom's projects aimed at capturing the luxury tourism market are located along the Red Sea coast. Set to open next year, Neom's luxury island resort of Sindalah is advertised as an "exclusive gateway to the stunning Red Sea."

Saudi officials need to show that the locations are safe from nearby conflict zones to be able to attract high-spending visitors.

"The optics of stray missiles and drones slamming into Saudi cities when they're trying to attract the sort of high-end luxury markets would be disastrous," Ulrichsen said.

The 2022 Formula 1 Grand Prix in Jeddah, which took place against a backdrop of thick black smoke after Houthi missiles hit a fuel depot five miles away from the racetrack, is unlikely to be far from officials' minds.

After the attack, plumes of black smoke were visible from the circuit and seen during the first practice session, sparking alarm from international drivers.

Supply chain issues

Conflict in the region may also cause issues when it comes to the construction of ambitious projects like Neom.

"The remote location of the project, combined with renewed tensions in the Red Sea, also pose specific issues around construction and delivery of equipment and materials," Robert Mogielnicki, a senior resident scholar at the Arab Gulf States Institute, told BI.

Officials will also need to convince firms and residents to buy into Neom and attract tourists to visit. Mogielnicki said these demand-related variables mean the Saudi government and planners have less direct control over Neom's success.

Saudi officials are already fighting to combat claims that Neom is facing delays and setbacks.

In recent months, Western media outlets have reported that the country is scaling back population estimates for The Line and seeking to borrow funds.

Last month, Bloomberg reported that the financial realities of the project, which could see cost spiral up to $1.5 trillion, have started to cause alarm within the Saudi government.

Difficulties getting construction materials to the Red Sea coast could further delay some Neom projects, which are essentially already "moving targets," according to Ulrichsen.

Neom did not respond to a request for comment from Business Insider.

• Some AI-controlled fighter jets are outperforming human pilots in dogfights, per the AP.
• The outlet witnessed an hourlong experimental flight at the Edwards Air Force Base in California.
• The Air Force is reportedly planning a fleet of more than 1,000 AI-enabled unmanned warplanes.

Some AI-controlled F-16 fighter jets are already outperforming human pilots in dogfights, according to a report from the Associated Press.

The AP reported this finding after witnessing an hourlong experimental flight at the Edwards Air Force Base in California.

During the flight, the AI-controlled F-16, called Vista, performed maneuvers at more than 550 miles an hour with Air Force Secretary Frank Kendall on board.

While the AI system is still in its early days, the AP reported that some versions of the tech are learning so rapidly that they have outperformed pilots in air-to-air combat.

Representatives for the US military did not immediately respond to a request for comment from Business Insider, made outside normal working hours.

The US Air Force has been actively exploring AI, which has been cited as a transformative technology for military action globally.

Although the technology is not yet fully developed, the AP reported that the force plans to build up a fleet of more than 1,000 AI-enabled unmanned warplanes. The first AI-controlled jets are set to be in operation by 2028, per the report.

Kendall told the outlet he'd seen enough during the experimental flight to trust the technology to decide whether to launch weapons in a war.

Industry experts and human rights activists have warned an using AI to make autonomous decisions during military action could lead to errors and unintended casualties.

A recent report claimed Israel was using AI to help identify targets in its war against Hamas without thorough human oversight. The IDF denied the claims at the time in a statement to BI.

• US presidential candidates Biden and Trump both vow to get tough on China.
• EIU predicts worsening US-China economic and diplomatic ties over the 2020s.
• EIU doesn't expect US trade policies to significantly reduce China's role in global production networks.

The US presidential election is less than six months away, and Democratic and Republican presidential nominee frontrunners Joe Biden and Donald Trump have both vowed to get tough on China.

Despite this, China will likely extend its reach in the global supply chain, the Economist Intelligence Unit, or EIU, wrote in a note on Tuesday.

The EIU, which is expecting Biden to retain the US presidency, expects "a sustained worsening" in economic and diplomatic ties between China and the US over this decade — regardless of who wins the election.

"Either president will pursue policies aimed at exerting further pressure on China's technology sector, while also justifying future trade and investment restrictions based on national security concerns," wrote the EIU analysts.

In April, President Biden called for a tripling of tariffs on Chinese steel and aluminum imports, echoing former President Donald Trump's levies on a range of goods from China.

Trump said in February he would slap tariffs of over 60% on Chinese goods if he's elected.

Should Biden win the presidency, he is expected to continue to continue working with like-minded governments.

"The primacy of US security and economic goals in Mr Biden's diplomatic agenda will still ensure a degree of collateral damage to economies that have deep trade and investment linkages with China," wrote the EIU analysts.

They added that if Trump wins the presidency, he is likely to take a "much more antagonistic approach" to the US-China relationship, which risks collateral damage to third-party economies.

"This would return bilateral diplomatic and trade relations to the state of volatility that characterized his first term," the EIU analysts wrote.

However, the EIU said it doesn't expect either Biden's or Trump's trade policies to reduce China's role in global production networks significantly.

It is instead expecting the extension of China-linked supply chains via "capital-hungry markets" in Latin America and Southeast Asia.

"These same dynamics will ultimately make many of these emerging markets vulnerable to an escalation of trade hostilities with the US," EIU's analysts added.

As it is, Chinese manufacturers may already be skirting sanctions by using Mexico as a backdoor to get exports into the US.

Even Chinese manufacturers are shifting their production out of China to other low-cost manufacturing hubs in Asia, including Vietnam and Bangladesh, to avoid geopolitical risks.

• Automotive journalist Jules Rogers test-drove the 2024 Ford F-150 Raptor priced at $83,665 and loved it.
• The truck provides a comfortable and luxurious ride with black leather interior and high-end features.
• She says the Raptor is perfect for drivers seeking an off-roading experience and is worth its price.

In a group of similar trucks, the 2024 Ford F-150 Raptor immediately stands out from the crowd. With its 37-inch tires and 17-inch alloy wheels, the beefy truck lives up to its raptor moniker.

Raptors are more widely available now, which is pretty new considering how hard they've been for Ford loyalists to get their hands on over the last few years. Especially if you're driving in the sand, off-roading on dunes or camping at Burning Man, this truck has all the features to show up in style.

I'm not a truck owner myself — my daily ride is my Audi Q6 compact SUV or A3 hatchback. As an automotive journalist, I get to test drive new vehicles all the time.

I got behind the wheel of a 2024 F-150 Raptor finished in deep midnight, antimatter blue metallic with a pearlescent finish at the Oregon International Auto Show. It felt large since the seating was so high up, but it was actually quite nimble.

The 2024 F-150 Raptor starts at $77,980, and the model I tested was listed at $83,665 with its optional upgrades. I enjoyed it a lot, even for city driving — although it would be even better for people who live near wider roads, farms, and work zones.

Interior and aesthetics

The Raptor offers a comfortable ride for such a large vehicle. The exterior features cast-aluminum running boards that make it easy for a short person like me to jump in.

From the outside, the front facia grill has an aggressive look embedded with LED fog lights and a cold air intake on the hood featuring the Raptor logo. The sporty dual exhaust makes a mean rumble at the optional automatic power tailgate, which features an after-market look with a gun-metal finish on the exhaust tips. The Raptor nameplate and block-letter Ford logo finish the classic, upscale look.

The Raptor is more heady, sturdy, and robust than the F-150's more standard (and affordable) work truck models. For full-size off-roading trucks, the Ram 1500 or Chevy Silverado 1500 are comparable, when you spring for the similar high-end price range.

The spacious interior with luxurious black leather made me feel small. The bucket seats are very comfortable and super plush for a Ford.

The interior feels roomy enough to comfortably fit a family of five traveling cross-country or just to the store. There's plenty of room for groceries and other items you wouldn't want exposed in the truck's bed.

The Ford Sync 4 infotainment system is on a 12-inch screen, which is wonderfully easy to use. I really enjoyed the luxe leather-wrapped steering wheel and the Bang & Olufsen sound system.

There are a lot of different auxiliary switches in the ceiling of the cabin's interior. I enjoyed the optional moonroof, which nearly spanned the entire width of the vehicle.

This truck has so many features that it's hard to think of more options to add. It would take some time to familiarize myself with the tech loaded in there.

Driving experience

Like with all F-150s, the driver decides on the aftermarket parts. Rear parking assist provides added comfort so you don't back into anything.

It's easy to maneuver with its 10-speed transmission and 3.5-liter eco-boost engine and offers lots of power immediately when you hit the gas, but it's not scary to drive. Even though it's a very big piece of machinery, you still feel in control and not overwhelmed by the size of the truck.

You can barely feel the transitions from one gear to the next. The Raptor felt like it could smoothly transition from the off-road experience to paved driving. It's easy to turn and maneuver, even in the city.

The acceleration is very responsive, but you can tell it's making moves — and taking up space. A lot of the heavy torque really kicks in during the higher gears. Visibility was great while driving.

For off-roading, this truck features upgraded suspension and rockers. I only drove on city streets this time, though.

I really enjoyed that the Raptor has a 36-gallon fuel tank so I can definitely get where I need to go. It earns about 9-10 gallons per mile.

The Ford F-150 Raptor is a great ride

The truck is perfect for a driver who's looking for a serious vehicle that offers the ultimate off-roading experience. With all the standard features on the truck's base model, owners can feel good about the value they're getting from the Raptor.

I think the upgraded model is worth its price, especially for drivers who need a full-size truck and often go off-road.

Driving the Raptor makes you feel cool. It's very imposing and makes other vehicles look small. Although it might be a bit big for the city, it's easy and comfortable to drive.

Even non-truck lovers will love hopping into this truck — I was delighted to get behind the wheel and enjoyed every moment of it.

• Startup Havelar built Portugal's first 3D printed home using COBOD's popular printing system.
• The walls of the two-bedroom, 861-square-foot home were printed in 18 hours.
• The Portugal-based startup says it can build faster and cheaper than conventional construction.

If companies like Portugal-based Havelar have their way, the future of affordable housing will look like perfectly stacked strands of spaghetti (as in, they'd be 3D printed).

Printing-construction startup Havelar says it can build a new home in less than two months while pricing it significantly below market, all with the help of a robotic construction printer.

It may sound like an impossible claim, but its latest project — and Portugal's first 3D printed home — has made its case.

Havelar completed an 861-square-foot, two-bedroom home in Porto, Portugal, in late April.

Following the success of its project, the startup is now touting its ability to build houses for 1,500 euros per square meter, or about $150 per square foot.

That prices its new dwelling at about $130,000 — half the median cost of similarly sized homes in Porto, according to data from Spanish real estate company Idealista.

Like Havelar, proponents of printer-built homes have been making lofty promises about the futuristic tech.

Giant automated printers are increasingly being lauded as a way to build high-quality natural disaster-resistant homes faster and cheaper while reducing waste and labor.

However, like any nascent tech, the construction 3D printing industry has been facing growing pains, such as the high cost of printing materials and an underdeveloped workforce.

Printers have limitations, too: Most can only build walls, while the rest of the home has to be completed conventionally.

But printing can significantly slash build time — so much so that the walls of Havelar's home were printed in 18 hours, according to COBOD, the 3D printer's manufacturer.

Despite how it sounds, a printer-built home doesn’t have to look unrecognizably futuristic.

Save for the layered-looking walls, a signature of 3D printers, Havelar's build looks like any new two-bedroom house.

It wouldn’t be a modern home without an open-concept kitchen and dining room.

Like Texas-based Icon's first luxury printed home, the contrasting colors and textures of the wood finishes and the printer's cement mix create a contemporary and trendy feel.

But don’t start pulling out money for the downpayment.

Plans to sell the home are "currently unclear," a spokesperson for COBOD told Business Insider. Havelar did not respond to a request for comment from BI.

If you want to move into an affordable printed home, it might be best to wait for Havelar’s next projects.

Otherwise, be prepared to pay more in the US.

Rodrigo Vilas-Boas, cofounder of Havelar, said in COBOD's news release that its construction methods would allow first-time homebuyers to acquire their dream home in a good neighborhood for €150,000, about $162,000.

That's a steep price difference from Lennar and Icon's upcoming community of 100 3D printed homes near Austin, where the first six units were priced between $476,000 and $566,000.

Even steeper, homes at Icon's development in Marfa, Texas, a seven-hour drive east, start "in the upper $900,000s," according to its website.

• Russia said on Monday that it would treat F-16s in Ukraine as an escalation because they're nuclear-capable.
• The Foreign Ministry said it would consider the delivery of the jets as a "purposeful provocation."
• Meanwhile, the warplanes already used by Ukraine can technically be fitted to deploy nukes too.

Russia warned on Monday against the expected arrival of F-16s in Ukraine, saying the US warplanes would be treated as an escalation given their potential as nuclear weapons platforms.

"No matter what modification of the aircraft will be supplied, we will treat them as nuclear-capable and we will consider this step of the United States and NATO as a purposeful provocation," the Russian Foreign Ministry said in a statement, per state media Sputnik.

The ministry blamed the North Atlantic Treaty Organization for pushing the war in Ukraine closer to "the point where it will attain 'critical mass' and explode."

Ukraine is expected to receive its first promised F-16s from NATO members soon. Belgium, Denmark, Norway, and the Netherlands have pledged several dozen F-16s to Kyiv, and Ukrainian pilots have been training to use the jets.

Meanwhile, Russia has for months said the delivery of the F-16s is a provocation from NATO because they can be fitted to carry nuclear weapons.

"If they do not understand this, then they are worthless as military strategists and planners," Russian Foreign Minister Sergey Lavrov said in June.

But it's unclear how the F-16s alone would make a significant difference in any nuclear strike against Russia, since some Soviet warplanes used by Ukraine, such as the Su-24 and MiG-29, can already be modified to carry nuclear weapons.

The Su-24's capability in this regard was even cited by Russian ally Belarus, which said in August 2022 that its military had tweaked its Su-24s to carry tactical nukes. Minsk said it was ready to deploy the weapons in response to Western threats.

While Soviet planes like the Su-24 are not designed to carry a theoretically Western-supplied nuclear payload, Kyiv and its NATO allies were previously able to modify warplanes for Western arms.

Ukraine's Su-24 can now launch the British Storm Shadow missile, though it's not immediately clear if this success can be repeated with nuclear weapons.

In any case, Ukraine does not possess any nuclear weapons in its arsenal, having surrendered them in 1994 when it gained independence. It is subject to the Treaty on the Non-Proliferation of Nuclear Weapons.

Russia, on its part, has regularly threatened to use tactical nukes if it feels certain red lines have been crossed by the West, though it's been accused of saying this as a bluff.

The F-16 is hailed as a significant upgrade to Kyiv's old Soviet-era fleet, with a longer range, better weapons capabilities, and other improvements like maneuverability. They're also better aligned with much of the US equipment that Ukraine has been receiving, such as high-speed anti-radiation missiles, meant for ground targets.

Yet in a war where neither Kyiv nor Moscow has been able to achieve air superiority, observers are unsure how significantly the F-16 will change the landscape of the conflict.

Russia has deployed advanced air defense systems like the S-400, some of which are more sophisticated and effective than the threats faced by F-16s in previous war zones, Business Insider's Jake Epstein reported.

"There is a gazillion ways to detect these F-16s," Brynn Tannehill, a defense analyst and former US Navy aviator, told Epstein.

• Russia has a manpower crunch because of its war with Ukraine.
• Russia's military is paying more in sign-on bonuses and salaries than the oil and gas sector.
• Russia's oil and gas revenues have been keeping its war chest filled.

Russia is facing a labor crisis as its war with Ukraine siphons manpower away from the country's economy.

The manpower crunch has gotten so bad that the Russian military is now offering sign-on bonuses and salaries that are so competitive that even the country's lucrative oil and gas industry isn't keeping up, Bloomberg reported on Monday.

Russia's oil and gas sector has been paying wages that are at least two-thirds higher than the national average wage since 2017, per Bloomberg calculations based on official data.

That's no longer the case.

In January and February, workers in Russia's oil and gas sector took home about 125,200 rubles, or $1,370, in monthly nominal salary, per the media outlet.

But the Russian army is now offering incentives to contract soldiers, including a nationwide sign-on bonus of 195,000 rubles, according to a Russian government portal. Each region in the country also offers an additional one-time payment of up to 1 million rubles, per Bloomberg.

The salary of a contract soldier starts at 210,000 rubles per month.

That means people who enlist in the war receive sign-on bonuses and monthly wages greater than a month's oil or gas sector salary.

The competition Russia's military poses to its oil and gas sector is important because the country is a major energy producer, and the industry's robust revenues have kept Moscow's war chest filled. It also illustrates how Moscow's war in Ukraine — now into its third year — is siphoning resources from the rest of the Russian economy.

Moscow-based Kasatkin Consulting, formerly Deloitte's research center, estimates that Russia's oil and gas industry faces a shortfall of 40,000 workers this year, according to Bloomberg.

"Staff shortages have affected even the wealthy industries," Alexei Zakharov, the president of Superjob.ru, an online recruiter, told the media outlet. "The oil and gas sector can afford to attract employees with higher salaries, but the state competes by offering military contracts."

Putin is urging Russians to have more babies

Russia's manpower crunch isn't solely due to wartime mobilization.

There was a massive brain drain after the war started — which has somewhat reversed — and a demographic crisis in the making before the conflict started.

Furthermore, the UK estimated last month that about 450,000 Russian military personnel have been killed or wounded since the war started in February 2022. This excludes those who have been killed while serving in private military companies.

Russia's demographic crisis is so dire that Russian President Vladimir Putin has taken to encouraging women to have more babies for ethnic survival.

"If we want to survive as an ethnic group — well, or as ethnic groups inhabiting Russia — there must be at least two children," Putin said at a tank factory in February.

• Silvio Berlusconi went on a hunting trip with Vladimir Putin in 2013, per Italian media.
• During the trip, Putin shot and carved out a deer's heart, which he offered to the late Berlusconi.
• The sight of the raw meat was just too much for Berlusconi, who went behind a tree to vomit. 

Russian leader Vladimir Putin once presented the late Italian premier, Silvio Berlusconi with a deer's heart that he carved out himself, a former Italian senator said on Sunday.

Fabrizio Cicchitto, who was once a member of Berlusconi's Forza Italia party, told the Italian newspaper Corriere della Sera that Berlusconi recounted the experience to him after visiting Russia in 2013.

Berlusconi, Cicchitto said, was accompanying Putin on a hunting trip in the Russian countryside when Putin spotted a pair of deer. After shooting the deers, Putin told Berlusconi he would prepare an extraordinary meal with it, per Cicchitto's recount.

According to Cicchitto, Putin proceeded to cut open one of the deer's body with a hunting knife. Putin then pulled out the deer's heart himself and offered it to Berlusconi.

The sight of the raw organ, however, was just too much for Berlusconi, who according to Cicchitto, retreated to behind a tree to vomit.

Berlusconi might have balked at Putin's culinary offering, but the former Italian prime minister shared a close relationship with Putin.

Months after Russia invaded Ukraine, Berlusconi defended Putin and said the latter was just trying to "replace Zelenskyy's government with a government of decent people."

And when Berlusconi passed away in June 2023, Putin was quick to offer his condolences.

"For me, Silvio was a dear person, a true friend," Putin said of the Berlusconi. "His death is an irreparable loss and great sorrow."

While Cicchitto's recount may seem bizarre, it does seem to be in line with Putin's penchant for cultivating a macho strongman image. Stories of Putin's machismo also likely come in handy at a time where the Russian leader needs to show strength — in the middle of a years-long war that has drained Russian resources, in which the US has now committed an additional $61 billion to help Ukraine keep the fight going.

The Russian leader has been involved in multiple over-the-top photo ops over the years, where he's been seen flexing his judo moves and riding a horse while shirtless.

In fact, eating a deer's heart is probably not that strange once you consider what else Putin has done with animals, per prior accounts.

In April 2022, Russian investigative news outlet Proekt reported that Putin took baths using blood extracted from severed deer antlers as a form of alternative medicine.

Representatives for the Russian foreign ministry didn't immediately respond to a request for comment from BI sent outside regular business hours.

• Palantir's first quarter revenue jumped 21% from last year, mostly from US customers.
• International earnings dropped due to "headwinds in Europe," the chief financial officer said.
• CEO Alex Karp maintained his support for Israel and again slammed campus protests.

Palantir raked in more money than ever last quarter — and much of it came from customers in its backyard, according to the company's earnings released Monday.

Denver, Colorado-based Palantir, which develops software for private and military purposes, posted revenue of $634 million in the quarter ending March 31, a 21% increase from the same time last year. The revenue largely comes from growth in both private and military segments in the US, as it faces headwinds in the international market.

"I think it is fair to say we crushed Q1 in the US. We are on fire," said Palantir CEO Alex Karp on Monday's earnings call.

Palantir's best-known business is supplying technology to the US government, which grew 12% year-over-year, to $257 million. Its private-sector business is seeing even faster growth. US commercial revenue, which comes from selling software to 262 firms like Cleveland Clinic and General Mills, rose 40% year-over-year to $150 million, per Monday's earnings.

Palantir is doubling down on the US, including defense and AI, Karp said on Monday's call.

While the company reported strong US numbers, its international performance dipped compared to the previous quarter because of an accounting move and "continued headwinds in Europe," chief financial officer Dave Glazer said on Monday's call.

International commercial revenue for the first quarter was $149 million — down 3% from the prior quarter, but up 16% year-on-year. And international government revenue was down 9% from the prior quarter, to $79 million — though up 33% year-on-year.

About 16% of Palantir's total business comes from Europe.

"Europe is gliding toward 0% GDP growth over the next couple of years. That is a problem for us. There is no easy remedy for that," Glazer said.

The software maker's stock fell over 8% in after-hours trading, but it is up 52% this year as it rides the artificial intelligence wave.

Because of its government work, Palantir has long been a lightning rod for domestic and international political debates.

The company supplies AI models to militaries allied with the US, including Israel and Ukraine. In March, Karp said that employees left the company because of its stance on Israel.

"If you have a position that does not cost you ever to lose an employee, it's not a position," he said in March.

Karp addressed the matter in the call as well, saying Palantir is the first call for Western allies in global conflicts.

"The central risk to Palantir and America and the world is a regressive way of thinking that is corrupting and corroding our institutions that calls itself progressive," he said. "But is actually a form of a thin pagan religion."

The CEO lashed out at the wave of pro-Palestine student protests occurring at US universities in a conversation with Palantir's senior policy advisor during a tech conference in Washington, DC last week. He brought the matter up again on the earnings call.

"The greatest institutions of our time disappear and turn into discriminatory dysfunction," he said on the call.

For the second quarter of 2024, the company said it expects revenue between $649 and $653 million, close to a $20 million increase from first-quarter revenue.