Andrew says the verdict is likely to rattle President Trump, a vocal opponent of the Time Warner deal. “Mr. Trump doesn’t like to lose, and that could make his administration more reluctant to police future deals that actually deserve to be blocked,” he writes in his latest column.
Tesla is cutting staff in a bid for profitability
In a sign of financial sense, the carmaker announced that it would lay off 9 percent of its staff of 37,500. The cuts will mainly hit salaried employees and won’t affect production workers at its plant in Fremont, Calif. (That’s important, given its struggle to build enough Model 3 sedans.)
The aim is to slow Tesla’s cash burn: It lost $785 million in the first quarter, despite generating $3.4 billion in revenue. In an email to the staff, Elon Musk said that his company’s vision — to “accelerate the world’s transition to sustainable, clean energy” — would not happen “unless we eventually demonstrate that we can be sustainably profitable.”
DealBook’s take: Streamlining — and presumably reducing how rapidly it needs to raise money — sounds sensible for Tesla. But exciting new projects like an electric truck could now become harder to finance. There’s also a risk to that highflying stock: If Tesla behaves like a normal company, investors may start to value it as one.
Who wants to do business with North Korea?
When President Trump met Kim Jong-un in Singapore this week, one of his pitches to the dictator was the prospect of Western investment in North Korea. Businesses aren’t exactly lining up to build factories in Pyongyang — at least, not yet. But could that change? Alex Stevenson of the NYT assesses the chances:
Some in the business world find the idea intriguing. The North has a relatively young population and an underground entrepreneurial bent. It has a large amount of resources like rare earths and iron ore. And South Korea has offered the North a modernization plan that includes building railways and power plants.
Crossed wires? North Korean state media said Mr. Trump offered to lift sanctions on Pyongyang. That wasn’t the White House line.
The political flyaround
• President Trump is expected to impose tariffs on Chinese goods as soon as Friday. (Politico)
• Take a close look at Tom Barrack, a billionaire ally of Mr. Trump who has strong ties to the Middle East — and introduced him to Paul Manafort. (NYT)
• Mick Mulvaney’s time atop the Consumer Financial Protection Bureau — sorry, the “B.C.F.P.” — is near an end. His potential replacement: Representative Darrell Issa, a California Republican who isn’t running for re-election.
• A New York state court has curtailed the reach of the Martin Act, which has been used to bring fraud charges against Wall Street. (NYT)
Seattle fought Big Tech. Big Tech won.
Last month, city officials unveiled a business tax meant to help pay for homeless programs and affordable housing. It would have fallen in large part on Amazon. But the e-commerce behemoth lobbied hard against the tax — and now it’s dead.
The lesson for mayors and city governments elsewhere? Taking on tech titans is risky, especially if they employ lots of people in your district. More from David Streitfeld and Claire Ballentine of the NYT:
The politicians had no stomach for a protracted battle over jobs, even at a moment when the area’s unemployment rate is only 3.1 percent. “It is clear that the ordinance will lead to a prolonged, expensive political fight over the next five months that will do nothing to tackle our urgent housing and homelessness crisis,” they said.
The deals flyaround
• Bird, a big player in electric scooter sharing, is said to be raising $300 million — equivalent to its total valuation three months ago — at a valuation of $2 billion. (NYT)
• Adyen, a European payments processor used by Uber, priced its I.P.O. at the top of the expected price range, valuing itself at $8.3 billion. (WSJ)
ZTE could be in trouble again
Republican senators are betting that President Trump won’t block their effort to restore penalties against the Chinese telecom company that the White House struck a deal to save.
What Senator Bob Corker, Republican of Tennessee, told the WSJ:
“I don’t think the president cares about ZTE. Someone told me that he gave [GOP lawmakers] a wink and a nod and told them he didn’t care. I don’t know if that’s true or not, but I think he did what he did for the Chinese leader but he doesn’t really care what Congress does.”
Elsewhere in ZTE news: The company’s stock resumed trading in Hong Kong overnight after a two-month hiatus, and its market valuation is down by $3 billion.
The tech flyaround
• Malware mined nearly 5 percent of all the Monero cryptocurrency in circulation. (Palo Alto Networks)
• A blockchain experiment in Britain could remove red tape at customs borders. (FT)
• IBM thinks it can make A.I. 100 times more energy-efficient. (MIT Technology Review)
• Bill Gates’s new energy fund has made its first investments, in grid storage. (Quartz)
• Facebook has opened a design lab to improve privacy. (Bloomberg)
Big banks predict who’ll win the World Cup
Ahead of the first game tomorrow, strategists and analysts have put their quantitative skills to use to predict the overall winner of the tournament. Their approaches — including A.I., statistical modeling, and economic analysis — show that picking a winner is just as divisive among the world’s largest banks as it is in sports bars from Moscow to Manchester.
UBS backs Germany, Goldman Brazil, and ING Spain. Here’s how they got to their results.
In other World Cup news: FIFA expects to make $6.1 billion from this year’s tournament. Some games will cause stock market weirdness. And people watching the tournament in Russia may have their devices hacked.
• Guess Inc.’s co-founder, Paul Marciano, has resigned from the clothing company after an investigation into allegations that he sexually harassed and assaulted women. (NYT)
• Cambridge Analytica’s former chief data officer, Alexander Tayler, is trying to reinvent himself as a consultant on data analytics — and compliance. (FT)
The speed read
• If robots come for our jobs, what should the government do? (NYT)
• America’s investment banks have been eating the lunch of European counterparts for years. That might be about to change. (FT)
• Why do economists rarely talk about inequality? Perhaps because they’re afraid of politics. (Bloomberg)
• Beijing says it will let foreign banks run securities businesses in China — so long as they have at least $15 billion in net assets. (WSJ)
• How long do we have to wait before productivity rises? (FT)
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News credit : Nytimes