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C.E.O.s urge Washington to help with asylum seekersAs New York City’s migrant crisis continues to escalate, with more than 100,000 arrivals from the southern U.S. border straining shelters, some of the city’s top business leaders are intervening in a fight over who’s responsible. But recent communications by the Biden administration suggest that such calls won’t be heeded. The letter underscores the increasing urgency of the crisis, which has pitted Mayor Eric Adams against Gov. Adams has said the crisis could cost the city $12 billion over three years, while Hochul has spent $1.5 billion and deployed nearly 2,000 National Guard members so far. The migrant crisis is a business issue.

Persons: Jamie Dimon, JPMorgan Chase, Larry Fink, BlackRock, Jane Fraser, Citigroup —, Biden, won’t, Eric Adams, Kathy Hochul —, Adams, Hochul Organizations: JPMorgan, Citigroup, Gov, Biden, National Guard Locations: Washington, York, U.S, New

Her visit, which will include meetings with business leaders and government officials, including her Chinese counterpart, Wang Wentao, will be closely watched as she looks for common ground on trade, even as she seeks to curtail it. Here is what Ms. Raimondo expects to focus on during her trip, according to The Times’s Ana Swanson, Alan Rappeport and Keith Bradsher. Ms. Raimondo is likely to defend the escalating tech war, which she will argue is meant to protect U.S. national security. (Ms. Raimondo said on Monday that she would neither compromise nor negotiate on that point.) The White House this month announced plans to bar private equity and venture capital firms from making investments in China in quantum computing and advanced semiconductors.

Persons: Raimondo, Gina Raimondo, Wang Wentao, Ana Swanson, Alan Rappeport, Keith Bradsher, Ms Organizations: China, Biden administration’s, U.S Locations: Beijing, China

☆ WeWork plunges another 11% after announcing reverse stock split to try and keep NYSE listing
▼ + stars: | 2023-08-18 | by ( Ari Levy | ) www.cnbc.com time to read: +2 min

WeWork , the office-sharing company once valued at $47 billion, said Friday it will undergo a 1-for-40 reverse stock split to try and keep its stock from being delisted. "The Reverse Stock Split is being effected to regain compliance with the $1.00 per share minimum closing price required to maintain continued listing on the New York Stock Exchange," WeWork said in a filing with the SEC. The reverse split will take effect after the close of trading on Sept. 1, the company said. The move will do nothing to improve the company's financials or valuation but, based on Friday's close, it would lift the stock price to $5.60. With or without a higher stock price, WeWork is in dire straits.

Persons: WeWork, Masayoshi Son's SoftBank, Andrew Ross Sorkin, Adam Neumann Organizations: New York Stock Exchange, SEC, NYSE

Just a month ago, Wall Street was hailing the so-called “magnificent seven” for driving the gains this year in the S&P 500. As MarketWatch notes, four of the seven (Apple, Nvidia, Meta, and Microsoft) have fallen at least 10 percent from their highs in July. Tesla, the worst of the bunch, has tumbled more than 25 percent in that period, putting it in bear territory. On Thursday, alarm bells sounded on both sides of the Atlantic as investors sold government bonds en masse, sending yields to multiyear highs. Adding to the jitters, the renminbi hit a 16-year low against the dollar on Friday, prompting emergency moves to prop up the currency.

Persons: Tesla Organizations: Nvidia, Meta, Microsoft, SpaceX, Elon Musk’s, Nomura Locations: Hong Kong, United States, China

One area looks safe from the dreaded “R” word: the housing market. Goldman predicts home prices will rise even more next year, in part because housing supply is so constrained. Forecasts of a prolonged housing market slump haven’t materialized. Those moves have helped push mortgage rates to a 22-year high. “Home buyers have demonstrated behavior that, in our view, reflects unsustainable adaptations to elevated mortgage rates,” the Goldman Sachs strategists Roger Ashworth and Vinay Viswanathan wrote in a research note.

Persons: Goldman Sachs, Goldman, Bankrate, Roger Ashworth, Vinay Viswanathan Organizations: Fed Locations: U.S

The markets await a new testInflation fears are like a zombie menace stalking the markets this summer. Concerns that the Fed’s battle with rising prices may not be finished have roiled stocks and bonds this month, and investors will be glued to the release of Fed meeting minutes for July at 2 p.m. Eastern on Wednesday for clues on what’s next for rates. Since the last rate-setting meeting in July, economic data has showed that inflation is cooling, but that’s hardly calmed the markets. Tuesday’s strong retail sales data, and hawkish comments from some central bankers, have put the markets on edge. He said on Tuesday that he was seeing “positive signs” that inflation was easing, but warned: “I’m not ready to say that we’re done.”

Persons: Mary Ann Bartels, DealBook, ” Neel Kashkari, “, ” Organizations: Fed, “, Federal, Minneapolis Fed

Shares in Hong Kong and Shanghai closed lower again, but, unlike on Monday, the damage didn’t spread across Asia. China’s economy, the world’s second biggest, is in a prolonged slump. That poses a challenge for global growth. has previously forecast that China would account for 35 percent of global growth this year, but that’s looking less likely. The slowdown is hitting everything from commodities to construction, and some big U.S. companies that operate in China don’t expect a rapid turnaround.

Locations: China, Beijing, Hong Kong, Shanghai, Asia

☆ Barclays names the global stocks benefitting from falling inflation — and gives two 60% upside
▼ + stars: | 2023-08-15 | by ( Ganesh Rao | ) www.cnbc.com time to read: +3 min

Barclays identified several European stocks that it says could benefit from an environment of falling inflation. As interest rates remain elevated, inflation is expected to fall further toward the European Central Bank's 2% target in the coming months. The below table highlights 10 "disinflation winners" from Barclays with the biggest upside: Delivery Hero Among the stocks highlighted, shares of food delivery company Delivery Hero had the biggest upside potential. Lloyds Banking Group Barclays expects shares of U.K.-based lender Lloyds Banking Group to rise 64% over the next 12 months to £0.70 ($0.89). Together with falling provision risks we expect higher profits to drive outsized capital returns," said Barclays' analysts led by Aman Rakka in a note to clients on July 27.

Persons: Emmanuel Cau, Andrew Ross, Aman Rakka, Larissa van Deventer Organizations: Barclays, Central, Lloyds Banking Group Barclays, Lloyds Banking Group, Lloyds, Legal, General Barclays Locations: U.S

But that bullish prediction is doing little to restore investors’ optimism, as concerns mount about consumer confidence and the health of global economy. Now, concerns are growing about China’s domestic property market after Country Garden, one of the country’s biggest developers, missed debt payments. Those ructions have sent the prices of global commodities, including Brent crude, tumbling on Monday. The group’s woes have sparked contagion fears for China’s shadow banking sector, and hit U.S. business. Despite better-than-expected corporate earnings and signs that inflation is cooling, investors have dumped stocks and bonds this month.

Persons: Goldman Sachs, Brent, Bonds Organizations: Deutsche Bank, Silicon Valley Bank, Treasury Locations: U.S, Stocks, Asia, Hong Kong, Silicon Valley

American luxury-goods companies have long wanted to build a multibrand rival to take on the European giants that dominate the industry. Tapestry and Capri said the deal could lower their costs by $200 million over the next three years. Tapestry is taking on a lot of debt via an $8 billion bridge loan — the largest M.&A. And Capri depends heavily on Michael Kors, which generates 70 percent of its revenue. By comparison, Versace, Capri’s only real luxury brand, accounts for just a fifth of sales.

Persons: Kate Spade, Michael Kors, Versace, Tapestry, Salvatore Ferragamo, They’ve, Capri, Capri’s Organizations: Burberry, Street

Disney’s next moveEven if Bob Iger, Disney’s C.E.O., didn’t have much to reveal about big-ticket M.&A. Streaming is Disney’s future, Mr. Iger said, but the era of pursuing breakneck growth in the business is over. The strategy now is to extract more money from subscribers via hefty price increases for Disney+, and hoping that those efforts don’t drive them away. While the latest figure was less than analysts had expected, that performance is still untenable in the long term, leading Mr. Iger to follow Netflix’s example and raise prices for Disney+ and Hulu. “We grew this business really fast, really before we even understood what our pricing strategy should be or could be,” he told analysts.

Persons: Disney’s, Bob Iger, Iger, don’t, ” Organizations: Disney

Dentons, the largest Western law firm in China in terms of staff, said yesterday it would separate from Dacheng, its unit there. The two firms merged in 2015, and Dentons even added Chinese characters to its logo to signal its commitment to the country. That made it impossible to follow legal industry standards and best practice, a person familiar with Dentons’ decision-making told DealBook. “Standards are diverging between China and Western economies,” Eswar Prasad, a trade policy professor at Cornell and a former head of the I.M.F.’s China division, told DealBook. Employees at financial firms operating in China have reportedly been forced to attend lessons in the ideology of President Xi Jinping.

Persons: Dentons, DealBook, Eswar Prasad, “, Xi Jinping Organizations: Cornell Locations: China, Western, ’, Sequoia

Goldman makes a big executive changeThe man who has been perhaps the most influential executive inside Goldman Sachs for more than a generation has begun to hand over some of his responsibilities. John Rogers, who over his quarter-century at the Wall Street bank has been known as a board and C.E.O. whisperer, will give his role as chief of staff to Russell Horwitz, his onetime deputy, Andrew and DealBook’s Lauren Hirsch are first to report. Rogers has an outsized influence and an intentionally understated public profile. He also wielded considerable influence outside the firm, helping Paulson become Treasury secretary in 2006.

Persons: Goldman, Goldman Sachs, John Rogers, Russell Horwitz, Andrew, DealBook’s Lauren Hirsch, Rogers, David Solomon, Reagan, George H.W, Bush, ” Rogers, Jon Corzine, Hank Paulson, Lloyd Blankfein, Solomon, Paulson Organizations: Goldman Locations: Washington

Mr. Gensler outlined some of his biggest concerns in an interview with DealBook’s Ephrat Livni. could be the next big systemic risk to the financial system. In 2020, Mr. Gensler co-wrote a paper about deep learning and financial stability. Mr. Gensler expects that the United States will most likely end up with two or three foundational A.I. “This technology will be the center of future crises, future financial crises,” Mr. Gensler said.

Persons: Gary Gensler, Gensler, DealBook’s Ephrat Livni, A.I, Mr Locations: United States

But the tech giants provided a snapshot of the state of the global economy: Consumers and companies are cutting back on some costs, but refusing to stop spending on increasingly essential services. Much of the revenue decline was caused by a drop in iPhone sales, which comprise half of Apple’s overall revenue. But revenue from services — including Apple Music, Apple TV+ and App Store sales — grew 8 percent, reaching a record $21 billion. In India, the company set a record for iPhone sales. The company enjoyed a surge in its core online retail business, showing that customers are still spending despite headwinds like rising interest rates.

Persons: they’re, Apple Organizations: Apple, Apple Music Locations: China, India

The fallout from Fitch’s downgrade continuesStocks appear set to open lower today, after falling yesterday in the wake of Fitch Ratings downgrading the United States’s AAA credit rating. But others have said Fitch’s move, while largely symbolic, still points to long-term troubles for the nation and its fiscal health. “There is no willingness on any side to really tackle the underlying challenges,” Mr. Francis said. But “it doesn’t really matter much,” Jamie Dimon, JPMorgan Chase’s C.E.O., told CNBC yesterday, echoing a common refrain to Fitch’s move. Critics of the move noted that according to criteria laid out last year by Fitch itself, including debt-to-G.D.P.

Persons: Richard Francis, Fitch’s, standoffs, ” Mr, Francis, ” Jamie Dimon, JPMorgan Chase’s, Fitch Organizations: Fitch, United States’s AAA, Wall, U.S, Times, JPMorgan, CNBC Locations: U.S

It’s unlikely that the move — only the second downgrade in American history — will dent investor appetite for Treasury notes. But the decision is another sign that Wall Street is worried about political chaos, including brinkmanship over the debt limit that is becoming entrenched in Washington. The move came two months after Washington narrowly avoided a U.S. default, following a prolonged argument over the debt ceiling. (That said, some on Wall Street remain skeptical that the country is headed for a so-called soft landing.) Fitch’s own model shows the U.S. economy deteriorating during the Trump administration and recovering under President Biden.

Persons: Fitch, “, Trump, Biden Organizations: Fitch, United States ’ AAA, Washington, Social Security Locations: U.S, Washington

Mr. Jobs will still be dedicated to fighting cancer. “My dad succumbed to cancer when I was in college at Stanford,” Mr. Jobs said. “I was pre-med because I really wanted to be a doctor and cure people myself. But he returned to the field after completing his master’s degree and led Emerson’s health care division, which has invested in companies and given grants to labs. Of his career path, Mr. Jobs said: “I had never ever wanted to be a venture capitalist.

Persons: Jobs, “, ” Mr, you’re, — Organizations: Stanford Locations: Yosemite

has brought back two former heirs apparent, Kevin Mayer and Tom Staggs, to advise on the future of Disney’s legacy TV businesses were sure to get Hollywood talking. Mr. Mayer and Mr. Staggs will help Iger think about “linear” TV properties like ABC, according to Puck. Both men had once been tipped as potential successors to Iger — Mr. Mayer as head of M.&A. (Mr. Iger chose Bob Chapek to take over, but he was ousted after two years and replaced by … Mr. Mr. Mayer and Mr. Staggs now run Candle Media, an investment company that has bought an array of production studios.

Persons: Robert Iger, Kevin Mayer, Tom Staggs, Iger’s, Mayer, Staggs, Puck, Iger, Mr, Bob Chapek, … Mr Organizations: Disney, ESPN, Media

The principle is that nature is an unpaid worker providing services, like carbon sequestration, soil retention, water filtration, replenishing raw materials and more. It is providing an invisible subsidy to world economies. Take carbon pricing. Poor countries that have abundant natural resources are loaning their economic resources, like the carbon-sequestering value of their rainforests, to rich countries without compensation. Why add such a pricing structure when economies can exploit nature for free?

Persons: John Kerry, ” It’s Organizations: Democratic, Resilience Locations: Democratic Republic of, Congo

Now, two prominent senators are pushing to create a new federal agency to rein in the power of Big Tech. Elizabeth Warren, Democrat of Massachusetts, and Lindsey Graham, Republican of South Carolina, plan to introduce the Digital Consumer Protection Commission Act, which they say would restrain tech titans while letting them continue to innovate. But these companies have fought hard against increased oversight, and it’s unclear how a new agency will fit into a Washington already full of regulators. The bill is in the vein of legislation that established agencies to oversee fast-growing industries, much like how Congress created the Interstate Commerce Commission, the Federal Communications Commission and the Nuclear Regulatory Commission. “For too long, giant tech companies have exploited consumers’ data, invaded Americans’ privacy, threatened our national security and stomped out competition in our economy,” Ms. Warren told DealBook’s Ephrat Livni.

Persons: Elizabeth Warren, Lindsey Graham, Ms, Warren, DealBook’s Ephrat Livni Organizations: Apple, Meta, Microsoft, Big Tech, Republican, Digital Consumer Protection, Interstate Commerce Commission, Federal Communications Commission, Nuclear Regulatory Commission Locations: Massachusetts, South Carolina, Washington

Legacy admissions in the cross hairsIn opening a civil rights investigation into Harvard’s legacy admissions policy — in which relatives of alumni and donors are given preference — the Biden administration inserted itself into a fierce debate amid efforts to remake the world of higher education. Opponents of legacy admissions have argued that the policy is unfair, especially after the Supreme Court struck down affirmative action in higher education. But Harvard and other elite schools have defended the practice as a crucial means of raising money. Legacy admissions policies, they say, tilt overwhelmingly toward white and wealthy students and discriminate against Black, Hispanic and Asian applicants. About half of legacy students at the elite colleges examined by the study wouldn’t be there without such an admissions boost.

Persons: Biden Organizations: Harvard, Education

keep Big Tech booming? Nasdaq futures are up on Tuesday morning, ahead of a Big Tech earnings bonanza that kicks off when Microsoft and Alphabet report second-quarter results after the closing bell. Mike Wilson, Morgan Stanley’s chief U.S. equity strategist, apologized to clients on Monday, writing that his pessimistic stock market calls failed to spot the surge in A.I.-related stocks. On the other hand, Marko Kolanovic, JPMorgan Chase’s chief market strategist, is unconvinced that tech fervor will help the markets avoid a sharp decline this year. All eyes will be on Microsoft and Alphabet, which are at the forefront of commercializing generative A.I., the technology behind chatbots like ChatGPT that have captured the public’s imagination.

Persons: Mike Wilson, Morgan Stanley’s, Marko Kolanovic, — Organizations: Big Tech, Nasdaq, Microsoft, Nvidia, Citigroup, JPMorgan Chase’s, Google

Twitter has flown awayBye-bye, blue bird: Twitter overnight began rebranding itself as X, replacing its longtime logo with a stylized symbol that was projected onto its San Francisco headquarters. X!” wrote Linda Yaccarino, the company’s C.E.O., as the social network starting rolling out its new branding. Gone is the stylized bird, once dubbed Larry T. Bird by the Twitter co-founder Biz Stone, which became one of the most famous internet logos — and which the company has described as its most recognizable asset. The platform’s about page hasn’t yet been updated, but Ms. Yaccarino repeatedly referred to X in a series of tweets outlining the company’s ambitions. Expect X to more fully pervade the company: Mr. Musk described an internal message to employees over the weekend as the last he’d send from Twitter, and he told a user that a post should be called an “x” instead of a tweet.

Persons: Elon, ”, Linda Yaccarino, Larry T, Stone, Yaccarino, Musk Organizations: Twitter, San Locations: San Francisco

The White House brokers an A.I. The commitments are voluntary, but industry watchers see the move as an important first step toward protecting consumers and businesses. The White House wants the companies to commit to “responsible” development. The White House said it would work with overseas allies, including Britain, Germany, Japan and South Korea, to develop common groundwork on A.I. It comes as China is developing its own guidelines for A.I.

Persons: Biden, White, “ Organizations: White House, Microsoft, Google, White Locations: Britain, Germany, Japan, South Korea, China

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