Just as Elon Musk ordered Twitter employees to return to the office, he plans to eliminate their costly free lunch perksarguing staff didnt show up to eat in the first place.

The reasoning may defy logic now that he has ended the privilege of remote working instituted by Jack Dorsey in October 2020, but it is emblematic of the companys acute financial trouble. 

Twitter is losing over $4 million every day by Musks count, and it faces a reported $1 billion in additional interest payments to cover the $13 billion in debt Musk piled onto the company as part of the deal.

Spending cuts at Twitter have been a divisive issue with some seeing Musks cuts as a draconian attempt to recoup the money on his overpaid investment, while others have little sympathy as eliminating perks are naturally one of the first levers to pull when restructuring a company deeply in the red. 

Musk said Twitter spent an estimated $400-plus per lunch served, or roughly $13 million a year for its San Francisco headquarters.

Part of the reason for the high per-meal cost, he outpointed, was the extremely low office attendance. Occupancy on an average day was clocked at less than 10%.  

Twitters vice president of real estate, Tracy Hawkins, disagreed with his calculation however, saying attendance was much higheranywhere from 20% to 50% in the offices. 

Thats a lie, posted Hawkins, who said she resigned rather than work for Musk. For breakfast and lunch we spent $20-$25 a day per person. This enabled employees to work through lunchtime and meetings. 

Musks bumpy ride so far

It wasnt the only time an employee at Twitter has called out Musk. On Sunday he also apologized to Twitter users abroad for slow performance, blaming it on the infrastructure. 

Yet Sasha Solomon, the tech lead on Twitter questioned whether he actually understood the programming language. 

You did not just layoff almost all of infra and then make some sassy remark, she wrote. Did you bother to even learn how GraphQL works?

Musks reign as owner of Twitter has been brief, but already it has created more drama than the social media platform had in years.

Hate speech spiked amid a loss in content moderation, imposter accounts multiplied like weeds, corporations yanked their advertising, and staff were sacked in a chaotic mass culling.

Instead of calming nerves, the chief twit himself has helped inflame them, using his platform to attack critics and opponents alike, warning at one point he would unleash a thermonuclear name and shame on companies that succumbed to what he has blasted as activist pressure and pulled their ads. 

To make matters worse, Twitters highest-ranking compliance officers quit as Musk reportedly risks billions in regulatory fines for not complying with a consent decree reached in May with the Federal Trade Commission. 

The reputational damage alone he has caused to the brand has some people speculating he hopes to write off the $44 billion as a gigantic reservoir of personal tax losses to offset gains from the sale of Tesla shares going forward.

The only solace is losses for tax purposes. Once their stock is found to be worthless, they are entitled to capital-loss deductions in an amount equal to their basis in the stock, accounting expert Robert Willens told Barrons.

Musk meanwhile continues undeterred with his plan to strike another key perk to Twitters employees in order to ward off the threat of bankruptcy.

There are more people preparing breakfast than eating breakfast, he posted on Sunday.

Its safe to say that with staff compelled to return to the office, that will no longer be the case.

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Strong action against global warming is quickly being eroded at this years COP27 as fossil fuel lobbyists at the UN climate conference attempt to dull the language around the Paris Agreement.

Several unnamed countries want to omit mentioning the 1.5C limit on the increase in global temperatures in the official text of the COP27 summit, U.S. Special Climate Envoy John Kerry said to reporters in Sharm El-Sheikh, Egypt on Saturday.

Youre absolutely correct. There are very few countries, but a few, that have raised the issue of not mentioning this word or that word, Kerry said when asked about opposition by some governments to mentioning the 1.5C target, or 2C limit at worst, which was first agreed in 2015 as part of the historic Paris Agreement.

Cutting out the 1.5C language in this years draft agreement would be a huge step back from the COP26 last year which took place in Glasgow, where all signing countries reaffirmed their promise to the Paris Agreement.

But the fact is that, in Glasgow that was adopted, the language is there. And I knowEgypt doesnt intend to be the country that hosts a retreat from what was achieved in Glasgow, Kerry said.

While the Paris Agreement was seen as a breakthrough in international climate ambition, the world has still been barreling towards this limit, mostly abetted by the continued burning of fossil fuels. The world has already warmed more than 1.1C from the pre-industrial average temperature, fueling extreme weather, food insecurity, and death.

But as the conference heads into its second week, fossil fuel producers have sought to distance themselves from the Paris Agreement, claiming they are removed from the discussion of global warming. Saudi Arabias Minister of State for Foreign Affairs Adel al-Jubeir told the Financial Times on Sunday that the Paris Agreement was achievable but we dont see this as a discussion about fossil fuels.

Fossil fuel producers are shaping climate talks

This year is the first year oil and gas companies have been invited to participate in the official program of events at COP27 in Egypt. Fossil fuels are the dominant cause of global warming, according to the Intergovernmental Panel on Climate Change, producing 89% of the total global CO2 emissions.

There are 636 fossil fuel lobbyists working for oil and gas companies and Middle Eastern governments registered to the COP27 climate talks, marking a 25% increase from the year before, according to NGO Global Witness. The petrostate United Arab Emirates, which has agreed to host next years COP28 summit, has the most lobbyists of any country with 70 official delegates. Fossil fuel lobbyists outnumber representatives from the 10 countries most impacted by climate change, according to GermanWatch, which include Puerto Rico, Myanmar, Haiti, Philippines, Mozambique, The Bahamas, Bangladesh, Pakistan, Thailand, and Nepal.

Fossil fuel producers fear their own viability in the wake of the energy transition and are looking to negotiate a compromise where their sector can continue to explore for and sell oil and gas, while the world still reduces emissions.

You can achieve carbon neutrality while producing fossil fuels, and were proving that in Saudi Arabia, al-Jubeir told the FT. Al-Jubeir, who reportedly dined with John Kerry on Sunday, did not comment on whether he wanted to keep 1.5C in the text, saying he would leave that to negotiators.  

Saudi Aramco has other suggestions to stop climate change. The state-owned oil giant hosted a green initiative event over the weekend, which featured its CEO Amin Nasser and TotalEnergies chair Patrick Pouyanné, where they touted tree planting, carbon capture technology, hydrogen fuel derived from gas, and a circular carbon economy, or recycling, as climate solutions instead of making any commitment to stop drilling oil and gas out of the ground.

I have been to eight COPs, and never seen any such blatant oil and gas promotion from a presidency before, David Tong, campaigner at Oil Change International told the FT. Theres no legitimacy in a COP presidency giving a big platform to major polluters without even asking them hard questions.

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Expect a tough crypto winter, but Crypto.com isnt going anywhere, CEO Kris Marszalek said during a live interview hosted on its YouTube channel.

Over the past week, Crypto.coms CRO token has dropped almost 45% on concerns the Singapore-based exchange will be the next to face a liquidity crisis. The exchanges daily volume has collapsed from last years highs of around $4 billion to about $284 million this past October, according to data from Nomics, and withdrawals are on their way back up as users and investors remove their funds from the platform.

In the interview, Marszalek reiterated that the exchange has a strong balance sheet and said its exposure to FTX was limited to $10 million.

We recovered $990 million from FTX, Marszalek said, pointing out that fund flows between exchanges are a necessary part of the business.

An audit of Crypto.com is underway, but it will take some time. Audit firms dont work at crypto speed, he said, emphasizing that Crypto.com and the industry both need full transparency to move forward.

Withdrawals are working as expected, he reiterated. The only stoppage has been related to GALA, SRM, and Ray.

SRM is closely tied to FTX, he said.

Marszalek said that CRO, Crypto.coms token, has never been used as loan collateral, unlike the relationship between FTX and Alameda and FTXs token, FTT.

Were never going to raise funds, he added, stating that the business is cash flow positive.

One of Crypto.coms more controversial moves has been stadium sponsorship, with eye-watering price tags. There are questions about how effective the whole thing is as a sales funnel. Marszalek says it is a worthwhile investment, reminding people that the contracts are paid yearly.

We pay a small amount every year, which amounts to around 10% of our revenue. This is not crazy compared to other companies, he said. Growth to 70 million users is not possible without some investment into brand awareness.

Part of the markets mistrust of Crypto.com might stem from the exchanges recent $400 million mishap, where it accidentally sent ether to an account at an exchange called Gate.io. That was the second time the company had mistakenly transferred an amount in the millions. In August, it was revealed the exchange had sent $10.5 million to a woman in Melbourne, and took seven months to notice.

Marszalek explained that all addresses for transfers of these scales are whitelisted and approved. The destination address was Crypto.coms corporate account at Gate.io, and the funds were returned after Gate.io raised the corporate accounts daily transfer limit.

The funds were at no risk of being lost, Marszalek said. The system would not allow us to send money somewhere it cant be recovered.

While some on crypto Twitter have speculated that this was part of a scheme to bolster Gate.ios holdings before its proof of reserves were published, Marszalek said this was not the case.

As for Crypto.coms critics Marszalek says hes looking forward to proving them wrong with actions and words.

Their allegations have no substance, he said.

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While Binance founder and CEO Changpeng Zhao was delivering a fatal blow on Tuesday to his chief competitor, FTXs Sam Bankman-Fried, he tweeted a curious announcement: Binance would begin to issue proof of reserves.

Crypto is filled with these sort of wonky phrases, but Zhaoor CZ, as hes more commonly knownhas suggested that proof of reserves can reform the industry, offering a new level of transparency that would prevent the sketchy accounting that led to FTXs rapid collapse.

CZ doubled down on Friday at the Indonesia FinTech Summit, telling a large audience that proof of reserves would be essential as regulators creep ever closer. 

That is absolutely going to be where the focus is for the next little while, which is right, he said. We have learned from our mistakes.

What is proof of reserves? 

Before the FTX firestorm, Binance already was the worlds largest crypto exchange and, by kneecapping SBF, CZ became the indisputable kingpin. 

In his initial tweet on transparency, CZ called for exchanges to do Merkle-tree proof-of-reserves, a data structure that encodes blockchain data. While blockchains are publicly verifiable, centralized exchanges like Binance, FTX and Coinbase do not offer a similar layer of transparency. If they published a Merkle tree, it would provide a map of sort for the customer assets they hold.

The Merkle trees would organize relevant datasuch as transactions with smart contracts or between accountsinto hashes, arranged into a series of parent and children nodes that resemble a Christmas tree. Its a complicated cryptographic concept that theoretically would allow a third-party auditor to verify the holdings. 

DavidgothbergWikimedia

If Binance does decide to implement this, its going to have the potential for a standard-setting impact across the industry, said Dr. Yesha Yadav, a law professor at Vanderbilt University who focuses on banking and financial regulation.

In the day after CZs tweet, eight other exchanges announced they would publish Merkle tree reserve certificates. 

Gautam Chhugani, the managing director of global digital assets at Bernstein, described the process as a publicly auditable proof of reserves, where an analyst could follow the trail and identify the exact amount of reserves an exchange holds across different asset classes.

The problem with FTX was many of its reserves were held in its own token, FTTa precarious position that precipitated a bank run. With depositors seeking a return of their assets, FTX didnt have sufficient reserves, rendering the exchange insolvent. 

Theres just a lack of any transparency about the asset quality of different exchanges in terms of their actual kind of safety buffers, he said. And that obviously came home to roost with FTX.

With proof of reserves, exchanges would offer more transparency around the assets on the exchange and what kind of liquidity buffers they have, as well as ensure that the asset qualities are not deeply leveraged so users can access their holdings.

As such, Chhugani said a Merkle tree proof of reserves would have exposed FTXs sleight of hand. 

FTX would never adopt something like this because of the specific actions that theyve conducted with use of funds, he told Fortune.

Binance is not alone in calling for proof of reserves. Nic Carter of Castle Island Ventures has documented other crypto companies who have committed to the practice.

'Trust, but dont verify 

While industry experts say proof of reserves is a good start, they also argue its insufficient. Dante Disparte, the chief strategy officer and head of global policy at Circle, said he's encouraged by the new commitment to transparency among crypto firms. However, he warned that for a company like Binance, simply presenting proof of reserves without an independent audit isnt enough.

Proof of reserves is worth about as much trust as you might have in the entity providing the proof of reserves, he told Fortune. Its not enough to take someones word and rely on promissory notes on Twitter. 

While blockchain data presents publicly accessible information, the case of the FTX empirea knotted web of dozens of companiesreveals how much deeper transparency efforts must go.  

Proof of reserves is an interesting fix, but its not nearly sufficient enough for exchanges and other operations that are reaching a large-scale, potentially systemic nature, Disparte said. To tell the market, Now, millions of users around the world, trust me, but dont verify beyond what the chain tells you, I think thats problematic.

He added that there should be an additional layer of third-party accounting.

Eric Berman, a cryptocurrency regulation expert for Thomson Reuterss legal research business, said he doubts Binance would release a full set of its financials listing assets and liabilities, although the exchange likely will issue the types of liquid reserves its holding. As a private company, Binance is under no obligation to publish its balance sheet.

The trick is going to be whether Binance can provide the public with a sufficient level of confidence in the Merkle tree metrics and its disclosures, he told Fortune. In any event, I dont think this equates to financials in the sense of annual CPA-audited financial statements that we are familiar with here in the U.S. 

On Saturday, the investor and entrepreneur Vinny Lingham tweeted that proof of reserves was a distraction. What was really needed, he argued, was proof of liabilities, or an accounting of how much a platform owes.

The need for regulation 

Despite the shortcomings, many industry players argue that proof of reserves is a positive step forward.

In a Twitter Spaces hosted by Fortune on Thursday, Castle Island general partner Nic Carter said he's long been an advocate for proof of reserves, although there hadn't been much appetite until last weeks events.

One issue is that, as a relatively nascent concept, accounting firms are not yet equipped to handle the auditing.

You are undertaking a bit more risk because its just a newer procedure, said Carter, who also pointed to one top 25 firm with experience, Armanino LLP, which has already been inundated with requests.  

The ever-looming complication is that the crypto industry still lacks the regulation present in traditional finance, facilitating the reckless behavior of companies like FTX. As lawmakers and enforcement agencies consider actual rules for crypto, advocates like Carter say proof of reserves could serve the industry as a form of self-regulation, rather than waiting for top-down federal regulation.  

The industry could show good faith and demonstrate that the centralized organizations are fully reserved, he said. Of course, you have to be fully reserved as a crypto bank, because you just never know when theres going to be a big withdrawal.

Yadav, the Vanderbilt law professor, told Fortune that impending legislation could have been a motive for Binances announcement.

Thinking a little bit more cynically, this is also one way to preempt super harsh potential regulation, she said. Yadav also warned that fully transparent reserves may achieve the opposite desired effect. 

With traditional finance, transparency efforts are generally conducted by regulators, not the public. If someone sees maybe youre selling a lot of treasuries and youre selling a big chunk of assets, then maybe youre in trouble, she added. It can trigger the problem youre trying to solve.

What comes next? 

With Binance calling for proof of reserves, the question will be whether the exchange actually follows through. A Binance spokesperson told Fortune that the company is current working on the next phase and plans to share it in the coming weeks.

"We intend to provide a proof of reserve that would be audited by a third party vendor with user verification available on third party platforms to verify and audit our customer holdings. We will first be providing BTC verification then followed by other tokens," they said.

They pointed to an initial update from Nov. 10 where Binance published its holdings of BTC, ETH, BSC, BNB, and TRX, telling Fortune, "This is not a complete set of data but we are working on it for the next phase and more information will be shared in the full audited report."

Carter from Castle Island said there has never been much doubt about the quality of financial reserves with Binance like there was with FTX, but the exchange is still far from transparent.

There is still the fact that they are this kind of borderless, domicile-free exchange thats perceived as being kind of a wildcard, he said during the Twitter Spaces.

Last week, Reuters reported that Binance had processed $8 billion of Iranian transactions, despite U.S. sanctions. Meanwhile, the Justice Department is pursuing an investigation into Binance regarding possible violations of money laundering rules, highlighting the exchanges shaky regulatory footing. 

Nevertheless, during his Friday address, CZ emphasized Binance still would succeed where others have failed. 

This is another wake-up call, he said. The last three days was a revelation of trouble, but the trouble was there way longer. 

Vivienne Walt contributed reporting.

U.S. stocks will end 2023 almost unchanged from their current level but will have a bumpy ride to get there, according to Morgan Stanleys Michael Wilson.

The top-rated strategist sees a volatile path to get to his 2023 year-end S&P 500 base-case target of 3,900 index points, about 2% below where the gauge closed on Friday. He expects stocks to fall as earnings estimates come down, before rebounding in the second half of the year.

The path forward is much more uncertain than a year ago, and likely to bring several twists and days/weeks of remorse for investors regretting they traded it differently, Wilson wrote in a note on Monday. In the short-term, he sees the stock-market rebound sparked by last weeks good inflation data running for a few more weeks.

The portfolio strategist who correctly predicted the slump this year and is ranked No. 1 in the latest Institutional Investor survey said consensus earnings estimates for 2023 are still much too high. His base case is for U.S. company profits to decline 11% in 2023, before a strong rebound in 2024 as positive operating leverage returns.

His comments sound another warning for U.S. companies wrapping up their weakest earnings season since the first quarter of 2020, marked by the impact of high inflation, a stronger dollar and some dramatic profit warnings.

Wilson expects the S&P 500 to trough between 3,000 and 3,300 index points at least 17% below current levels in the first quarter. He recommends investors stay defensively positioned from a sector and style standpoint until the estimates reflect the bust. After upgrading staples, the strategists are overweight on that sector as well as healthcare, utilities and defensively-oriented energy stocks.

JPMorgan Chase & Co. strategist Mislav Matejka is more positive. He sees continued support to equity markets from a peak in bond yields, cooling inflation, light positioning, and the likelihood of a smaller-than-typical earnings contraction, according to a report on Monday.

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Billionaire Elon Musk has become responsible for yet another company with his acquisition of Twitter. And while some see his track record as a goal, Musk himself doesnt think its a lifestyle others should aim for. 

Id be careful what you wish for. Im not sure how many people would actually like to be me, he said, speaking via video link to the B20 business conference in Bali, in response to an observation that many leaders in Asia wanted to become The Elon Musk of the East. 

They would like to be what they imagine being me, which is not the same thing as actually being me, Musk continued. The amount that I torture myself is next level, frankly.

Now CEO of social media company Twitter, as well as Tesla and SpaceX, Musk also founded start-ups Neuralink and the Boring Company. 

As a self-confessed workaholic and nanomanager, numerous reports have previously revealed his tendency to get involved in different areas that a typical chief executive might stand back from. 

At Tesla, Musk has taken on decisions from car-styling to supply chain issues. Meanwhile, in only a few weeks, hes had a hand in firing over 50% of Twitters staff while also implementing (and removing) major changes to the platforms features, moderation systems, and means for making a profit. 

Overworked seven days a week

Musk also added that such responsibilities means he never stops working, and that currently hes working at the absolute most amountfrom morning til night, seven days a week. 

I have too much work on my plate that is for sure, he said. 

As long as he remains distracted by his $44 billion Twitter deal, the intensity appears set to continue. Musk reportedly told staff that they must work with a maniacal sense of urgency, to prepare for a predicted recession. 

As for his other companies, turning too much away from them has already had consequencesearlier this month Teslas shares tumbled to their lowest in nearly 18 months, and Wedbush analyst Dan Ives removed the stock from the companys Best Ideas list, citing the distraction and bad PR caused by Musks work at Twitter.

Musk has essentially tarnished the Tesla story/stock and is starting to potentially impact the Tesla brand with this ongoing Twitter train wreck disaster, Ives wrote in a client note.

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Environmental, social, and governanceor ESGinvesting is the latest target of Republicans who want to push their backward agenda at the expense of taxpayers. Its a method of investing that prioritizes sustainability, invests in technologies of the future, and factors in the risks associated with climate changewildfires, floods, hurricanes, and droughts.

According to Bloombergs analysis, ESG returns have trounced fossil fuel stocks and other investment strategies, and theyre crushing the traditional investment benchmarks by bringing in big returns. The largest exchange-traded fund investing in ESG increased its assets 4,700 times to $24 billion since its inception in 2016 and 80 times the past three years while investor appetite increased 56 times during the past three years. The Global Sustainable Investment Alliance estimates that ESG investments have reached $35 trillion.

Despite the proven results, some Republicans have targeted ESG because it doesnt agree with their agenda, again attacking private industry when it disagrees with them. And the real losers here are the taxpayers, as state funds miss out on superior returns because politicians are trying to score political points.

In disregarding the interests of people whose livelihoods depend on public pension funds, states like Texas, Florida, West Virginia, and Oklahoma have limited or even outlawed ESG investing. They have prevented state and local pension funds from their duties to consider the best investments for their state and to simply price climate risk into their investment portfoliosa risk that clearly impacts every state in different ways.

Ignoring the danger that climate change poses is a clear financial risk to investments. Were talking about catastrophic power outages in Texas brought on by uncharacteristic winter storms, wildfires throughout the West that have wiped entire communities and critical infrastructure off the map, record-breaking heat that strains electric grids, and more. These increasingly common events represent billions of dollars in insured and uninsured losses.

Many of the biggest investment firms are taking this seriously. As the CEO of Street Global Advisors said, ..we have a fiduciary responsibility to our clients to maximize the probability of attractive long-term returns and will never hesitate to use our voice and vote to deliver better performance. This is why we are so focused on financially material ESG issues.

The CEO of Blackrock, Larry Fink, noted, Stakeholder capitalism is not about politics. It is not a social or ideological agenda. It is not woke. It is capitalism, driven by mutually beneficial relationships between you and the employees, customers, suppliers, and communities your company relies on to prosper. This is the power of capitalism.

With $700 billion in assets, Californias largest public pension fundsCalSTRS, CalPERS, and the UC Retirement Savings Programare managing the risks that climate change poses to producing returns by charting pathways to net zero and transitioning away from investing in fossil fuel. Using ESG is part of how we get there.

No one can afford to keep burying their head in the sand. We need to invest in the future, move fast to reduce pollution, and accelerate the transition to clean, renewable energy to meet this challenge.    

The pattern of behavior from Republican governors like Ron DeSantis of Florida is clear: punishing free enterprise and capitalism for political gain. When Disney spoke out against the Dont Say Gay bill, DeSantis revoked Disneys tax status, increasing costs on local taxpayers. He blocked money for the Tampa Bay Rays practice facility after the baseball team spoke out against gun violence following the deadly mass shootings in Uvalde, Texas, and Buffalo, N.Y.  DeSantis has tried to restrict what businesses can and cannot say to their own employeesand even went after the Special Olympics for its COVID-19 measures.

In California, weve consistently beaten Florida and other Republican-led states in nearly every economic category, from GDP growth to job creation to new business starts.

Weve also chosen a different path to investing and producing returns for taxpayers. Yes, we continue to invest in traditional energy companies. But we also prioritize investments in renewables and new technologies that recognize the very real dangers of climate change and speed our clean energy transition. We fulfill our obligation to retirement security we made to our teachers, our cops, and our firefightersnot by playing politics, but by sticking to bedrock investment principles and values that put people first.

Those are just the facts. Sacrificing financial gains and economic growth for politics only hurts taxpayers and their pensions.

Gavin Newsom is the governor of California.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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