Bad jobs data tests White House braggadocio 6 Oct 2017 The U.S. economy lost 33,000 positions last month, largely due to hurricanes Harvey and Irma. It’s probably a temporary blip. But President Trump and his aides have touted monthly employment gains and other snapshot economic figures when it suits them. They own the downturns, too.
Review: Dani Rodrik gives economists a better name 6 Oct 2017 The mildly iconoclastic Harvard professor’s “Straight Talk on Trade” runs through several controversial claims, from praise of diversity in economic models to support for curbs on capital flows and unfair trade. His humility is admirable, even if his pessimism may be overdone.
German scrap metal IPO hinges on green alchemy 6 Oct 2017 Befesa, which turns waste steel dust into more expensive zinc, could be valued at up to 1.6 billion euros in a Frankfurt listing. Buyout groups offered less earlier this year. Hope that emerging economies will tighten up environmental rules may justify the rich price.
Costco will struggle to shake off Amazon discount 5 Oct 2017 The U.S. members-only retailer grew sales by 15.8 pct in its fourth quarter. Yet its shares haven't recovered since Amazon expanded into groceries. There’s room for both, but the e-commerce giant has an advantage: its shareholders are used to tiny operating margins.
Amazon’s delivery self-help may have AWS effect 5 Oct 2017 The e-commerce goliath's web needs led it to build something for itself that became a big and profitable business. Jeff Bezos is now testing a way to ship goods to save money, a venture that could threaten UPS and FedEx. Amazon's solutions are a growing problem for others.
Viewsroom: Building the car for the future 5 Oct 2017 Ford boss Jim Hackett’s plan to catch up with rival GM on electric and self-driving vehicles starts with $14 bln of cost cuts. China may be in pole position as it considers banning gasoline cars entirely. But plenty of factors could delay mass adoption of new technology.
White House economist drinks Trump’s Kool-Aid 5 Oct 2017 Tax cuts will pay for themselves through economic growth, says Council of Economic Advisers chief Kevin Hassett. He also backed the U.S. president’s protectionist policies, despite being a “full-blown free trader.” That’s one aide fewer willing to dispute voodoo economics.
Yahoo’s corpse keeps festering at Verizon 5 Oct 2017 Marni Walden, a possible candidate to lead the U.S. telco, is leaving. She was also in charge of buying the internet firm, which just tripled its tally of customer accounts exposed to an earlier hack. Even if the timing is coincidence, Yahoo’s troubles continue to cast a pall.
Fintech deal suggests everything old is new again 5 Oct 2017 Navient is buying student-loan refinancer Earnest for less than half its 2015 valuation. Even then, it'll eat into the buyer’s earnings and buybacks. Worse, Navient faces a fresh lawsuit over dodgy practices. Modern finance is feeling a lot like the kind it's supposed to replace.
SeaWorld a slimy meal for ex-Blackstone predator 5 Oct 2017 Merlin Entertainments is mulling a bid to buy the theme parks of the operator famous for its killer whales. Both were once owned by the buyout group. A $1.6 bln sale could create value, but SeaWorld’s complex ownership and the tough business outlook make a breakup tricky.
More for China than London in Russian hydro IPO 5 Oct 2017 Oleg Deripaska’s En+, which controls aluminium outfit Rusal, aims to raise $1.5 bln in an LSE and Moscow listing. It touts a green model, but public investors will have little say. The cornerstone backer, a partner of the PRC group that just bought into Rosneft, may do better.
Greg Fleming returns rich as Rockefeller 4 Oct 2017 The ex-Morgan Stanley exec is back on Wall Street in a venture with the legendary New York dynasty. The new advisory and money-management firm for the ultra-wealthy is small by Fleming’s standards. But he has found an ideal brand to target a fast-growing $60 trln market.
Office Depot photocopies M&A flop 4 Oct 2017 The chain store is jumping into IT services by forking over $1 bln for CompuCom. But its attempt to diversify has a bad track record: Dell, HP and Xerox tried it and failed. The 16 pct drop in Office Depot’s value implies investors reckon the deal won’t stop flagging sales.
Trump gets Puerto Rico priorities in a muddle 4 Oct 2017 The president’s vow to wipe out the U.S. commonwealth’s debt sent its bonds plunging. The devastation wrought by Hurricane Maria may necessitate another restructuring. But it doesn’t address the island’s problems. Its citizens need money, supplies and services, not distraction.
Hadas: Road to calm finance is unsafe at any speed 4 Oct 2017 A decade after the last financial crisis began, central banks are finally moving to normalise interest rates and money supply. With governments weak and banks and businesses hooked on easy credit, risks are high. There’s a better way to run this system, but few seem interested.
Uber board clears nearby jams, not entire route 4 Oct 2017 The ride-hailing app upped its governance star-rating, scrapping super-voting rights, expanding the board, and dropping internecine legal action. Directors also backed a SoftBank investment and set a 2019 IPO deadline. There’ll still be fights over control and valuation, though.
Europe faces bigger tax foe than Amazon and Apple 4 Oct 2017 The bloc’s antitrust chief ordered Luxembourg to collect 250 mln euros from the e-commerce giant. She is also pursuing Ireland over a 13 bln euro Apple case. The EU is winning the loophole battle. But a bigger war to level the global tax playing field may meet U.S. intransigence.
Telco banks may be consigned to fringes of finance 4 Oct 2017 Orange and Altice plan to offer banking services to capitalise on a boom in digital finance. It’s a novel solution to slowing telecom revenue growth, and similar ventures were a hit in Africa. But mobile operators are entering a crowded field, with no obvious advantage.
Ford’s clever electric van plan in China 4 Oct 2017 The U.S. carmaker is changing course in China, insiders told Reuters, as sales slow. New state policies open an opportunity for Ford to build electric commercial vehicles. That could help meet quotas - and electrify Ford SUVs. Much depends on the partner, and battery supply.
Ford CEO bets ambitious retool on big cost cuts 3 Oct 2017 Jim Hackett is slashing $14 bln of fat over five years and switching $7 bln of investment to SUVs from cars. That'd boost earnings, helping speed development of electric and autonomous vehicles. The plan will have to fire on all cylinders to catch up with the likes of BMW and GM.