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BOSTON (Reuters) - Some small investors who want to give a piece of their minds to big tech company directors are losing their only chance: many board members are skipping annual shareholder meetings. Companies that hold meetings online have some of the worst records for attendance.


The health and social care secretary criticises Airbus for warning it could leave the UK in the event of a no-deal Brexit.


Sarah Sanders said she was refused service at the Red Hen because she worked for Trump


LONDON (Reuters) - Britain's health minister Jeremy Hunt said on Sunday it was inappropriate for businesses like Airbus [AIR.PA] to issue warnings about moving jobs because of Brexit.


Google-owned platform offers its video stars more ways to make money


Female drivers take to the Kingdom’s roads after decades-long ban is lifted


President Erdogan faces challenge from resurgent opposition in critical elections


Prospects for the Faang trade and pound’s bounce in focus for the new trading week


Producers search for new markets as Beijing curbs domestic output 


Prime minister pushes for an agreement that looks like a single market for goods but not services


Survey shows men and women think differently about how much diversity has improved


National probe launched into workplace misconduct in response to #MeToo campaign


Cambridge Analytica

  • Cambridge Analytica staffers did not believe the allegations about the company until almost the very end.
  • Two Cambridge Analytica insiders that Business Insider spoke to describe the final months at the firm before it filed for bankruptcy.
  • The company's management held a constant stream of "town hall" meetings with staffers to wave off the news reports and allegations, and staffers took the  leaders at their word.


When Cambridge Analytica’s London offices were first raided by government authorities, the mood among employees was surprisingly cheerful.

Cambridge Analytica had become publicly embroiled in a media firestorm days earlier as news reports revealed how it sought to manipulate American and British voters by using the personal data of more than 87 million Facebook users.

But there was a sense of relief among Cambridge Analytica staffers when they realized the official visitors who'd swarmed their workplace belonged to the Information Commissioner's Office — the agency tasked with protecting data privacy in the UK — rather than being “real” investigators. Staffers made jokes about the seemingly unthreatening and bumbling nature of their visitors, taking great pleasure in pointing out various “ICO fails.”

"It was quite fun because we went through the office and saw all the fails the ICO had," one former Cambridge Analytica employee recalls. "Like, they took our servers but couldn’t get into them, because we used full disk encryption."

The attitude was not so much temerity, as simple naiveté.

Business Insider spoke to two Cambridge Analytica employees who were at the company during the final days before it declared bankruptcy and shut down. Both employees, who wished to remain anonymous, described a culture in which rank-and-file staffers remained surprisingly loyal through the end, accepting the word of their managers as gospel and dismissing unwelcome media reports.

"Everyone thought we could ride this out," the other employee said.

Internal 'town hall' meetings dismissing the news reports became an almost daily occurrence

Facebook Zuckerberg Privacy Hearing Day 2 GettyThe week before the initial story broke, executives gathered employees for an "emergency town hall meeting." In the meeting, Cambridge Analytica's leadership warned that a "disgruntled former employee" had talked to the media. But they told everyone not to worry; the story wasn't going to be a big deal, according to an employee at the meeting.

As the controversy around Cambridge Analytica grew, internal town hall meetings became the norm, both employees said. After each new story about the company was published — which at some points was daily — executives would gather everyone to explain what the latest accusations were and how Cambridge Analytica was going to defend itself. 

The narrative executives told employees was a version of the company's public defense: the media was out to get them, Cambridge Analytica did nothing wrong.

The company's ties to the Trump campaign and to high profile conservatives like Steve Bannon provided plenty of reason for a political motive. Many employees even identified as left-wing or progressive, one employee said, and rationalized the political work they were doing as part of the job. Especially those who didn't work with political clients, the firm's links to Bannon, Republican mega-donors Robert and Rebekah Mercer, the Trump and Cruz campaigns, and the Leave EU campaign seemed distant to them.

Indeed, even as a series of emails, witnesses, and other documents surfaced that seemed to corroborate the initial news reports, most rank and file employees believed what their superiors were telling them. There were some rumblings about quitting, but most of the insiders, in words and actions, remained faithful. 

Employees felt especially confident following Facebook CEO Mark Zuckerberg's testimony before the US Congress and British Parliament. Employees clung to the fact that several politicians seemed to have a limited understanding of the technology behind Facebook and Cambridge Analytica.

The undercover videos were the turning point

(L R) Turnbull and Nix Cambridge AnalyticaThe mood changed quickly after British broadcaster Channel 4 released a series of undercover videos featuring CEO Alexander Nix. The video appeared to show Nix describing controversial tactics for landing potential clients and manipulating elections, including entrapping political opponents with sex workers.  

While the Facebook user data scandal was seen as smoke and mirrors by Cambridge staffers, the Channel 4 videos gave employees physical evidence of the data firm's alleged improprieties. The day the videos were released, some employees were watching them in the office and discussions of leaving ramped up. 

"No one wanted to work for him anymore," one employee said, referring to Nix.

The fallout from the videos toppled Nix, who told employees himself during a town hall meeting that he had been removed by the company's board of directors. Since the meeting took place at the end of the day in London, dejected employees went straight home.

Still, employees hoped that the media storm would eventually die down with Nix out of the picture, even as the firm's business was evaporating quickly. 

Trying to save the business

Almost immediately after the scandal became public, nearly all of the firm's commercial clients — which included New York University’s Langone hospital, The Economist, and The Financial Times, according to NBC News — left immediately.

About a dozen clients stayed with Cambridge Analytica and employees continued working for them as best they could. But their ability was hampered because Facebook had cut off the company's access to its platform, so no one was able to place targeted Facebook ads. The company tried to contact Facebook about the issue, but no one at the social media giant was returning any phone calls.

"Facebook and Google practically have a duopoly on digital advertising right now. If one of them won't let you advertise for your clients, you got both arms tied behind you back. There's no way you can function," an employee said.

Cambridge Analytica office

Engineers couldn't perform basic tasks because data management tools like Liveramp and Lotame also cut off the company's access to their services.

The firm briefly considered spinning off its commercial business and ditching political work altogether, but the idea never took.

Ultimately, though, "very few" people left Cambridge Analytica before it shut down and declared bankruptcy in May. But the exit that had the most impact was Alexander Tayler, Cambridge Analytica's chief data officer. After Nix was forced to resign, Tayler stepped in as acting CEO. But to everyone's shock, he stepped down weeks later and eventually left Cambridge Analytica altogether. Employees trusted Tayler, and they thought if anyone could save Cambridge Analytica, it would be him.

Tayler, who is now seeking work as a consultant about issues related to data privacy, has not responded to requests for comment from Business Insider.

The end of Cambridge Analytica was announced to employees in a town hall meeting, which had been rescheduled and pushed back several times. By that point, employees were either unmotivated to work or found that working was nearly impossible with all the distractions. Some were already looking for new jobs.

One of the former employees at the meeting recalled that Julian Wheatland, the company's latest acting CEO, began the meeting by talking about the history of the company.  At that point, the employee said, it was obvious what was coming next.

SEE ALSO: Net neutrality rules are now dead. Here's what that means for you, and what happens next

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Aarti Kapoor Moelis

  • Goldman Sachs has hired a rising star from Moelis & Company to its consumer and retail investment banking practice.
  • Aarti Kapoor, who carved out a business covering high-growth fitness companies like Flywheel and Barry's Bootcamp, will join Goldman as a vice president in August. 
  • Kapoor is credited with founding and running Moelis' health, wellness, and lifestyle investment banking coverage and was included on Business Insider's Rising Stars on Wall Street list in 2017

Goldman Sachs has hired a rising investment banking star from Moelis & Company who specializes in working with companies in the health and wellness industry. 

Aarti Kapoor, 32, will join Goldman's consumer and retail investment banking group, according to people familiar with the matter. She spent nearly nine years at Moelis, according to her LinkedIn profile.

A Goldman Sachs spokesman confirmed Kapoor would be joining the firm as a vice president in August. A Moelis spokesman declined to comment.

Kapoor joined Moelis as a junior banker in 2009 and leaves as an executive director, which like the VP title at Goldman is one a level below managing director. At Moelis she carved out a niche early on with high-growth health, wellness, and lifestyle brands, sourcing deals with companies like Flywheel, Barry's Bootcamp, and Vega, a plant-based sports supplement maker that sold for $550 million.

She is credited with founding and running the firm's health, wellness, and lifestyle business and was included on Business Insider's Rising Stars on Wall Street list in 2017

Goldman has been chasing after deals from such middle-market and high-growth companies from regions across America as part of a goal to cover more than 1,000 new companies and add $500 million in new investment-banking revenue.

The bank's consumer and retail practice is better known, however, for advising on high-profile mergers and acquisitions, which in 2018 includes the $18.7 billion Keurig-Dr. Pepper merger, Albertsons' $7.1 billion acquisition of Rite Aid, and General Mills' $8 billion buyout of Blue Buffalo Pet Products.

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HANGZHOU, China (Reuters) - Growing up in the Chinese port city of Dalian in the 1990s, Zhang Hongchang spent hours immersed in Japanese cartoons like Dragon Ball and Naruto.


robot waiter restaurant

  • The market for artificial intelligence will grow to generate $59.75 billion in revenues by 2025, Société Générale forecasts. 
  • The firm created a Rise of the Robots index with companies that are best positioned to profit from this growth. 
  • In the selection process, the analysts considered companies that invest heavily in research and development, those with a healthy return on invested capital, and sales growth. 

The robots won't take over every job, but they're already transforming the world. 

From self-driving cars to lab-grown meat, humans are designing robots to make our lives easier by speeding up and improving tasks we've always done. 

In fact, in a distant future, Société Générale sees artificial intelligence board members and politicians, and implantable phones as some of the possibilities. 

But bringing it back to the present day, the firm has identified investable companies that are best positioned to benefit from the growth of AI in their respective industries. AI will grow to rake in $59.75 billion market in revenues by 2025, SocGen forecasts.   

"AI raises concerns about security and privacy, and especially about the future of jobs," Daniel Fermon, the head of thematic research, said in a note on Tuesday.

"However, it also offers the potential for new solutions to some of our most pressing global problems, in areas ranging from climate change to the aging of the population ... Whatever the outcome, AI is happening, creating potential investment opportunities as the field advances."

The list below highlights the top companies in SocGen's Rise of the Robots index. In the selection process, the analysts considered companies that invest heavily in research and development, which they saw as essential to leading in the fields of AI and robotics. They also selected companies with a healthy return on invested capital and sales growth. 

SEE ALSO: The world's hottest tech companies are now worth more than $5 trillion, and they could be pointing out the next big bubble

NXP Semiconductors

Ticker: NXPI

Country: Netherlands

Sector: Semiconductors

R&D/sales: 16.79%

Return on invested capital: 6.26%

Three-year sales growth: 20.39%

Source: SocGen



Cypress Semiconductor Corp.

Ticker: CY

Country: US

Sector: Semiconductors

R&D/sales: 15.34%

Return on invested capital: -2.62%

Three-year sales growth: 54.09%

Source: SocGen



IPG Photonics

Ticker: IPGP

Country: US

Sector: Electronic Manufacturing Services 

R&D/sales: 7.16%

Return on invested capital: 18.94%

Three-year sales growth: 22.91%

Source: SocGen



See the rest of the story at Business Insider


20:42 Russia backs Opec plan to pump more oil (Financial Times)
Saudi Arabian oil minister makes it clear the kingdom has crude on tap


Chris Concannon

  • The market for initial coin offerings is about to witness a two-part regulatory reckoning, according to Cboe president Chris Concannon. 
  • The veteran trader said if such offerings are deemed as unregistered securities, then the SEC will go after industry participants and litigation will rise.
  • Crypto startups have raised billions of dollars via the fundraising method. 

Chris Concannon, the president of Cboe Global Markets, is one of Wall Street's biggest crypto advocates. But the trading veteran thinks investors should lay awake at night worrying about the uncertainty hanging over the market for initial coin offerings, the popular crypto crowdfunding method. 

"The reckoning will come in two waves," Concannon said in an interview with Business Insider. First, the SEC will go after ICO market participants. Then, class-action lawsuits against the teams behind ICO projects will surge. 

Crypto investors cheered when William Hinman, the SEC's director of corporate finance, said last week that ether transactions would not fall under the agency's regulatory purview. Still, Hinman's remarks did not give the greenlight for companies to run an ICO, which enables a company to issue its own token in exchange for ether or bitcoin (which ideally would go towards building a product or business).

The market, which is known for its fair share of both fraud and big dreams, has allowed some tech startups to raise billions of dollars from a wide-spectrum of investors. In total, more than $7 billion has been raised via the fundraising method in 2018, according to data from Token Report. ICOs are traded on dozens of exchanges across the world and are popular investments among the more than 200 crypto hedge funds. Pantera Capital, one of the largest crypto investors, has two ICO funds, for instance. 

If the SEC ultimately decides that the lion share of ICOs are unregistered securities, then many players in the market could find themselves in a legal quagmire.

"The actual party that offered the unregistered coin, they could have been involved in issuing an unregistered security," Concannon said. "Anyone who sold that off could be deemed an unregistered underwriter." 

To be clear, the SEC could come up with an entirely new designation for ICOs. And it's not clear to some market observers whether the agency would retroactively go after all market participants. Robert Hockett, a professor of financial regulation at Cornell University, said you would likely only see the SEC take legal action in certain circumstances. 

"I don't think it is the case that people involved in the business are going to be prosecuted against as if they have been violating the law," Hockett said. "But there is a little bit of a room for exception with something particularly egregious." 

That could mean a company misled investors about a certain offering or claimed that it would never fall under the auspices of the SEC. 

Either way, the story doesn't change for investors. If the SEC deems ICOs as unregistered securities, then their holdings would be rendered valueless. This, according to Concannon, would trigger the second wave of reckoning. 

"If you sold someone an unregistered security you are liable to them if they decide to take them to court," Concannon said. 

The market has seen a number of class-action lawsuits. Business litigation firm Silver Miller in late 2017 filed a class-action suit against Monkey Capital, a crypto hedge fund. The firm alleges the fund promoted its ICO that violated US securities law. Silver Miller also has pending cases against crypto exchanges Kraken and Coinbase. 

Law firm Polsinelli, which is advising clients to approach the ICO market cautiously, said it has "only likely begun to see the beginning of class action lawsuits filed relating to blockchain-related companies or companies that participated in ICOs."

Some of those suits could have merit, said Cornell's Hockett. 

"If they can prove investors were defrauded and misled by people who were better suited to understand the regulatory framework, but still instilled in investors a — no pun intended — false sense of security, then some suits would have merit."

For Hockett, the move indicates a shift in the market that is not without historical precedent. Crypto, he says, is moving out of the "Wild West" phase into a "regulatory scrutiny" phase, which in the short term will see the rise of funds to launch class-actions and increased litigation. But in the long term, it will see a cleansing of the market. 

"It is a legal life cycle of every new asset that becomes highly popular," he said. "It was true for tulips, junk bonds, and mortgage-backed securities, and now crypto."

Join the conversation about this story »

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trader

  • An increasing number of experts across Wall Street are warning that the ongoing market and economic cycles are entering their final stages.
  • One statistic compiled by Morgan Stanley suggests investors are already getting more risk averse, which could usher in the end of the cycle even more quickly than previously thought.

As the prospect of a trade war threatens to divide the world, a unified front is forming in global markets. It's just not the type any risk-seeking investor wants to see.

A Morgan Stanley gauge that monitors the correlation between asset classes and geographic regions has spiked to its highest level since 2016. This implies that financial assets around the world are trading more in lockstep than at any other point in recent memory.

6 21 18 global correlations COTD

Perhaps more important for those seeking market signals, it also means investors are shifting into risk-off mode — one that could be setting in for the long term. And it's a definite warning signal for the risk-hungry traders still scouring the landscape for yield.

Tim Emmott, the executive director at Olivetree Financial, takes it a step further by suggesting that cautious investors are bracing for the possibility of a market meltdown.

"The fact that this index is trending higher currently could well be the true signal for market players to realize that current multi-asset moves toward risk aversion may be more than short-term," he wrote in a note reviewed by Bloomberg. "The move in correlation here may be the canary in the coalmine for the medium-term trajectory of real systemic risk to markets."

To fully appreciate what's at stake as global cross-asset correlations surge, consider that tandem moves in stocks and bonds can throw portfolios out of whack by exacerbating volatility. This is particularly true for the models used by risk-parity and balanced mutual funds, which are designed to de-lever when price swings spike, according to Nikolaos Panigirtzoglou, a global market strategist at JPMorgan.

As if that's not worrisome enough, Binky Chadha, the chief global strategist at Deutsche Bank, recently pointed out that lockstep moves in major asset classes could portend contagion-driven weakness.

"The tight correlation in the moves across the major asset classes (oil up, dollar down, equities and bond yields up) suggests a pullback in one for idiosyncratic reasons would likely spill over to the others," he wrote in a client note earlier this year.

To Keith Parker, the chief US equity strategist at UBS, rising cross-asset correlations can be a sign that an economic expansion has entered its final stage. He told Business Insider back in March that he was closely watching the relationship between US stocks and bonds for recessionary signals.

In the end, if today's expansion is trudging through its final innings, it would seem to be a prudent decision for investors to start leaning toward risk-off positions.

But is it really time to pack it in and flee to safety? Any investor you ask is likely to suggest a different timeline for derisking. Some might urge you to seek shelter immediately, while others would be incredulous at the prospect of missing another leg of strength.

Regardless of where on the spectrum you fall, you'd be best advised to keep an eye on all these disparate elements. The signal you're looking for is probably there somewhere — and half the battle is knowing where to look.

SEE ALSO: An investing legend shares the inside story of how he helped build a $730 billion industry from the ashes of the tech bubble

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Tim Cook Trump

  • Apple could be one of the biggest losers in a trade war between the United States and China.
  • The New York Times reported Monday that the Trump administration had told Apple CEO Tim Cook that no tariffs would be placed on iPhones.
  • But a top White House trade adviser reportedly said he didn't have any knowledge of such an exception.

There are few companies with more to lose than Apple in a trade war between the United States and China.

The world's most valuable publicly traded company does nearly all of its manufacturing and assembly in China, the culmination of a long and complicated electronics supply chain that stretches around the world and ends with the Chinese-made iPhone you may be reading this story on.

So it's no surprise that the massive tariffs President Donald Trump has threatened and China's response could lead to a trade war that would cripple the iPhone company, and Apple CEO Tim Cook has been working behind the scenes with both governments to make sure it stays out of the crossfire.

As part of a closer look at how Apple has navigated the impending trade war, The New York Times on Monday reported that the Trump administration had told Cook that no tariffs would be placed on iPhones.

But a top White House trade adviser denied knowledge of any iPhone trade exemption in a conference call with reporters on Tuesday, according to Bloomberg. "With respect to Tim Cook and exceptions, I have no knowledge or comment about that," Peter Navarro, the director of the White House's National Trade Council, reportedly said.

The Times in Monday's report named Navarro as a trade official Cook tries to avoid, so it's possible he hasn't been told of an Apple-related trade decision behind closed doors. Cook reportedly has had better luck speaking with Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, and Larry Kudlow, the director of the White House's National Economic Council.

Cook maintains an open line of communication with Trump, and The Times said he visited the White House last month. Apple announced earlier this year that it planned to spend $350 billion in the United States over the next five years, news the Trump administration used to trumpet its economic policy.

"But I felt that tariffs were not the right approach there," Cook said in an interview with the financier David Rubenstein published earlier this month, adding that he showed Trump "some more analytical kinds of things to demonstrate why."

The White House has not made a public statement exempting Apple from tariffs, and China could always decide to place tariffs on materials that are used to make Apple's devices or make life difficult for Apple in other ways, such as by using bureaucracy to slow down shipments.

Apple and the White House didn't respond to emails. So it remains an open question whether Apple's charm offensive on the White House got the iPhone company special treatment from the Trump administration.

Treasury Secretary Steven Mnuchin, left, with Apple CEO Tim Cook

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NOW WATCH: Why Apple is having so many problems right now



Mnangagwa was addressing Zanu-PF event in rival stronghold a month ahead of elections


PARIS (Reuters) - The European Union will respond to any U.S. move to raise tariffs on cars made in the bloc, a senior European Commission official said, the latest comments in an escalating trade row.


Demoted conglomerate explores reverse merger to cut five-year exile from Topix index


Elon Musk



About a week ago, the world learned that Tesla is building some of its Model 3 vehicles not actually inside its factory in Fremont, CA, but rather under what CEO Elon Musk called a "tent."

The tent — in truth, a large temporary structure — houses a general assembly production line and is located adjacent to the plant. It's handing the company's $78,000 dual-motor, high-performance Model 3's, the most expensive versions of the vehicle. 

The $35,000 base Model 3's, intended to be Tesla's car for the masses, is seemingly a long way off. 

The goal behind the tent is apparently twofold. Tesla has a single general assembly line for its Model S sedan and Model X SUV, and two parallel lines for Model 3, all inside its factory. Lacking enough physical space in what is by the standards of the auto industry a large plant, Tesla looked to the fresh air of the East Bay for a fourth Model 3 line. 

The company is pushing hard to achieve a weekly Model 3 production target of 5,000 units, and the existing capacity under Fremont's roof wasn't adequate. It's worth pointing out that the Model 3 line was supposed to be an initial phase of the transformation of Tesla's manufacturing systems, factories into what Musk termed an "alien dreadnought" — some so thoroughly automated that it would be unrecognizable to auto industry veterans.

Model 3 production has struggled from the start, after a launch last July. Production "bottlenecks," as Tesla labeled them, at the company's Nevada battery factory and later automated assembly snafus in Fremont led the company to abandon its robot dreams an return to using good old-fashioned humans. The pace has been intense: Tesla has been running 24/7 on three shifts the get the Model 3 on track.

Tesla must post a profit — or bust?

Tesla Model 3

Part two of the tent maneuver involves Tesla's financials. Tesla has been burning a staggering amount of cash and has upped its annual losses to record levels. It's costing over $1 billion per quarter to operate — but the company has less than $3 billion in the bank. 

Yet Musk has said that Tesla will be cash-flow-positive and profitable in the second half of 2018 and require no new capital raises, either through issuing new equity or debt. Consequently, Tesla has been laying off 9% of its workforce, submitting anything more than $1 million in spending for Musk's personal approval, and throttling back its expenses while producing only the highest-ticket Model 3s. 

With the second quarter about to close, the third quarter has to yield some massive revenues to overcome Tesla's monumental costs.

In that context, the tent is either heroic or desperate, depending on your point of view.

The alien dreadnought plan is evidently in a shambles, but although Tesla shares have been hammered in 2018 after a huge rally in 2017, the stock price remains around $350 and market cap is larger than that of Ford or Fiat Chrysler Automobiles.

According to Musk, the tent and the new general-assembly line — presumably consisting of several million bucks in precision, computerized technology — went from concrete slab to pushing sheet metal in three weeks. So there's the heroism. 

Tesla's learning curve is steep

Tesla Detroit sales vs market cap

"I'm sure it's unique and unprecedented," Karl Brauer, Executive Publisher for Autotrader and Kelley Blue Book, told Business Insider in a phone interview. 

"But that’s their world — Tesla’s entire company is the Fremont factory," he added. "Tesla is still steep in the learning curve. They're constantly reassessing how well things are working. So if they're out of space, it all make sense if you factor that in."

But Brauer also said that what will be more telling as far as Tesla's future goes is how long the company sticks with general assembly in a temporary space. No other major automaker would attempt anything similar; as Brauer noted, they would typically establish the manufacturing capacity first and only then build the vehicles.

Bob Lutz — a former auto-industry executive at General Motors, Ford, and Chrysler — has been highly critical of Tesla and offering less optimistic point of view.

"Elon is desperate," he said in an email. "He realizes‎ that his (damaged) credibility hinges on his ability to produce 5,000 Model 3s per week. He'll do anything to get there."

Lutz said that a "quickie manual assembly line" in a tent is not business-as-usual in the auto industry. And he suggested that Tesla's hours-per-car expenditure, around 14-16 for a typical compact vehicle, have to be "off the charts."

That doesn't mean Musk won't get Tesla to post a result in the black for the second half. 

"As he skims off the layer of devoted disciples who will pay $60,000 for a $30,000 compact, he will probably still have a good variable margin and may even — by hook, crook, creative accounting, expense deferral, etc. — manage to eke out a temporary profit in the third quarter, which will soon evaporate again," Lutz said.

A million miles from an alien dreadnought

tesla factory

I've written a lot lately about how what's going on at Tesla looks nothing like anything I've ever seen in my years of covering car companies. The obsessive scrutiny of the Model 3's rollout, with everybody and his brother and second cousin speculating on the vehicle count, is in itself something I've honestly never even thought about before. Usually, when a carmaker says they're going to start selling a new vehicle, you assume that in short order they'll match production with demand and the factories will start humming.

Even in that context, the tent is sort of a bridge too far. In truth, I've admired Musk's moxie: You gotta do what you gotta do. On the other hand, there is an amateurish element to Tesla's current predicament that could easily be solved by asking for some help. With 400,000 pre-orders for the Model 3 in the books, several contract manufacturers in the industry would be glad to lend an assist — and customers would get their cars.

What the tent really shows us is how distant we've gotten from Musk's initial ambition for Tesla to deliver the first significant advancement in manufacturing since the vaunted Toyota Production System (TPS) was developed in the 1970s and 1980s (and ironically honed for General Motors when GM and Toyota jointed operated Tesla's factory, when it was known as NUMMI). 

There's some karmic payback on tap for Musk: he scoffed at TPS on an earnings call earlier this year. He later started talking about the "Tesla Production System" and insisted that it would be Tesla's biggest ultimate contribution to the future.

The alien dreadnought might still come to pass, if Tesla's can ride out its latest self-inflicted crisis. A new factory in Shanghai, China could be announced later this year and fulfill the dreadnought dream. But for now, Tesla is building very expensive all-electric vehicles in a giant tent, and that should give even the most ardent boosters of the company serious pause.

Business-as-usual in the auto industry might be boring to Musk. But at least nobody has to go on an industrial-grade camping trip to make cars.

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NOW WATCH: The best and worst things about the Tesla Model 3



Mike Novogratz

  • Michael Novogratz's merchant bank Galaxy Digital has access to hundreds of millions of dollars to invest in crypto companies. 
  • Its venture arm is eyeing companies that are building infrastructure solutions to lure Wall Street to the market for digital coins.

Famed hedge funder-turned-crypto enthusiast Mike Novogratz launched merchant bank Galaxy Digital earlier this year and its venture capital arm is already hard at work.

Business Insider has learned that Galaxy, which has businesses in asset-management, trading, and investing, has made a significant number of investments in the market for digital coins which have not yet been disclosed publicly.  

People familiar with the firm's operation said that the principal investment team, which staffs six people, has invested in high-volume ICO projects and has a significant portfolio of early stage ventures. 

The firm already announced it led a $15 million round in AlphaPoint, a New York firm that helps companies launch their own digital tokens, but other investments by Galaxy remain under wraps. 

Leading the unit's efforts is Sam Englebardt, a venture capital veteran who joined Galaxy in 2017. Greg Wasserman, a former vice president at Goldman Sachs, joined the firm as co-head of the venture unit in February. Chris Zioli, formerly of Insight Ventures, also is on the team. 

Galaxy has two pools of capital, including a $325 million EOS fund, which is specifically targeting companies that aim to operate off the EOS blockchain. Its second pool comes from the firm's balance sheet, which is in the "hundreds of millions," according to the people. 

The firm's focus is to invest in infrastructure, meaning companies that are building products to help bridge the gap between Wall Street and crypto, like custody solutions and trading technology. 

On Wall Street, custody banks such as State Street and BNY Mellon safeguard large amounts of wealth for other institutions while abiding by strict regulatory requirements. Some entities offer such solutions in crypto. BitGo, another crypto tech provider, is working on a qualified custodian product. Paxos, a New York-based firm, holds a trust-company charter in New York.

CMT Digital, another crypto venture capital firm, is looking at similar opportunities to Galaxy, said Colleen Sullivan, a partner at the firm. 

"We look for things missing in the market," she added. "What can help usher a wave of institutional capital. That's better infrastructure and we definitely need custody solutions to mature."

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NOW WATCH: Millennials are leading an investment revolution — here's what makes their generation different



Confused, worried trader

  • The global trade tensions being escalated by President Donald Trump could eventually plunge the world into recession, according to a growing chorus of Wall Street experts.
  • The prospect of an all-out global trade war has already prompted some investors to seek safety, providing a sample of the wide-reaching effects the conflict can have on markets.

If you think President Donald Trump's ongoing trade disputes have been disruptive, you haven't seen anything yet.

At least that's the message being delivered by strategists across Wall Street, who have watched in horror over the past week as the possibility of an all-out trade war has been ratcheted higher.

While an all-consuming worldwide conflict isn't the base case for these experts, it's become a plausible enough scenario that they're starting to quantify the potential negative impact. And their findings aren't pretty, particularly as it pertains to a possible economic recession.

Joseph Song, a senior US economist at Bank of America Merrill Lynch, has gone as far as to calculate the degree to which a full-fledged trade war would be a drag on US gross domestic product

As shown in the chart below, the annualized growth rate of real GDP would decline by 0.3 to 0.4 percentage points relative to the baseline in the first year, then shave an additional 0.5 to 0.6 percentage points off in the second year.

Screen Shot 2018 06 22 at 10.53.24 AM

Song argues that this negative effect on GDP, coupled with a jolt to the currently sky-high level of investor confidence, could lead to a dreaded economic meltdown.

"Trade tensions are likely to get worse before they get better," Song wrote in a client note. "A trade war coupled with a confidence shock could push the US to the brink of recession."

'Things could spiral out of control'

Song's BAML colleague, James Barty, who serves as the firm's head of global cross-asset and European equity strategy, recently shared similar thoughts. He says while the tariffs that have been instated so far will have a minimal effect, the larger ones proposed this past week could take a bite out of the global growth forecast.

Citing data compiled by the International Monetary Fund (IMF), Barty says if the US, China, and Europe each raise import prices by 10%, then GDP would drop 2-3% in all three regions — and that doesn't even take into account peripheral effects like supply chain disruption.

Also troubling Barty is the public rhetoric being espoused by top Trump adviser Peter Navarro and Secretary of Commerce Wilbur Ross. In his mind, those two shouldn't be treating a possible trade war as something that can be "won," given the major side effects such an outcome could have.

"In a worst case scenario, our economists talk of the global economy being tipped back into recession," Barty wrote in a note to clients. "Clearly no one wants that, but when some — Navarro and Ross for example — talk about winning trade wars, then the risk is that things could spiral out of control."

Side effects are already hitting the market

As Wall Street experts increasingly conclude that the brewing trade war could be catastrophic for the economy, investors worldwide are already reacting with their portfolios.

They pulled a record amount of money out of both global equity funds and their emerging-market counterparts over the past week, according to data compiled by EPFR Global, which pegs these risk-off outflows to — you guessed it — rising trade tensions.

Screen Shot 2018 06 22 at 1.25.40 PM

Ironically enough, US and Chinese stocks saw inflows over the seven-day period, likely due to the strength of their underlying economies. So what we have is a situation where global markets outside of the two nations primarily locked in a tariff battle are suffering collateral damage.

But that's not to say the situation in the US is completely settled. As with many potentially precarious situations in the US market, the lightning rod is tech stocks.

Michael Harnett, the chief investment strategist at BAML, notes that US tech in particular has been bucking the risk-off trend playing out globally. The sector is on pace to absorb $37 billion on an annualized basis, according to the firm's data.

Screen Shot 2018 06 22 at 1.32.41 PM

This may seem like a positive sign for the health of the market, but it can also be construed as a ticking time bomb of sorts. Investors who are cautious of a market meltdown continuously cite the unstable and speculative nature of such activity, which sees investors piling into crowded positions as they chase past performance.

In the end, we're left with a double whammy-type situation where a potential all-out trade war has economists fearing the worst, while yield-hungry investors continue to stretch market conditions towards their breaking point. It doesn't take an investing pro, nor a seasoned economist, to realize that this is heading for a bad conclusion.

For the time being, traders would be best served to hedge existing positions as best they can. Because if a recession does finally hit, it's going to be jarring, no matter how prepared you are.

SEE ALSO: The inside story of how a $730 billion investment industry was born from the ashes of the tech bubble

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NOW WATCH: Four MIT graduates created a restaurant with a robotic kitchen that cooks your food in three minutes or less



HONG KONG (Reuters) - Chinese smartphone maker Xiaomi Corp said on Saturday there is no time frame for a mainland share offering, casting doubt on Beijing's efforts to lure foreign-listed Chinese tech giants back home.


tesla factory

  • CB Insights used a linguistic algorithm to analyze 28 quarters of earnings calls from four automakers.
  • GM, Ford, Daimler, and Tesla were included in the study.
  • Tesla spends way more time talking about robots than the other three.


CB Insights, a data analytics firm, has done something interesting: it used algorithmic analysis to crunch 28 quarter of earnings-call transcripts from General Motors, Ford, Daimler, and Tesla.

The firm was able to make some intriguing observations from scrutinizing calls from 2011-2017, but one result stands out: Tesla spends way more time taking about robots than other automakers.

"Tesla is the only [company] talking about using robots in the assembly line, with mentions of 'robots' and 'robotics' reaching a new peak in 2017," CB Insights wrote in its Mobility Earnings Transcript Analysis report.

Automation has been a double-edged sword for Tesla. CEO Elon Musk has talked it up a major future differentiator, enabling Tesla to build vehicles better and faster. But in practice at the carmaker's factories in Fremont and Nevada, it's been a mixed bag. Some efforts at automation haven't worked, and human workers have been added to the process to fix problems. 

Musk's "machine that builds the machine" is farther off than it might have seemed a year ago.

But why aren't other automaker's talking about robots?

The answer has two parts. First, Musk's embrace of automation is consistent with Tesla's story of disruption: in a brave new world of high-tech, Silicon Valley-inspired mobility, of course the dirty work will be done by machines. 

Second, established automakers have their act together with robots and have been dealing with them for decades. They might not be trying to replace all human workers with robots — in fact, efforts to do so have been unsuccessful, and car companies have learned their lessons —but they're familiar with what automation can achieve. So they treat it as a given. If they had to talk about it, particularly on an earnings call, it might actually be a bad thing.

The bottom line is that GM and Ford use a lot of robots to build millions of vehicles globally and have for years. But because automation, as it is currently utilized, is completely baked into their business models, it's pointless to discuss it with Wall Street analysts. They're more concerned about financial results.

Tesla financial results have been extremely depressing: the company has never posted an annual profit in 15 years of existence and in 2017 lost more money than ever. The balance sheet is something of a disaster. The stock price, however, is riding high, largely on the strength of a story.

Robots have been, of late, a key part of the Tesla tale. So we shouldn't be surprised that Musk has been spending more time than anybody else telling investors about them.

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NOW WATCH: A Wall Street chief economist explains what could be the saving grace for mega-cap tech companies



Trump Xi

  • President Donald Trump escalated his trade dispute with China and is planning for $200 billion worth of Chinese goods to be subjected to an additional 10% tariff.
  • In turn, China said it would slap the US with tariffs on $50 billion worth of US imports starting in July.
  • China's tariffs would target energy and agricultural products, such as ornamental fish, whiskey, and coal — which would affect some states more than others.
  • There are eight US states that exported more than $1 billion worth of tariff-eligible goods to China in 2017.


President Donald Trump escalated his trade dispute with China earlier this week, ordering the US Trade Representative to compile a list of $200 billion worth of Chinese goods to be subjected to an additional 10% tariff.

Trump's decision came three days after he announced tariffs on $50 billion worth of Chinese goods that would be subject to a 25% tariff.

In turn, China said it would slap the US with tariffs on $50 billion worth of US imports starting in July. China's tariffs would target energy and agricultural products, such as ornamental fish, whiskey, and coal — which would affect some states more than others.

Business Insider used US Commerce Department data to determine the number of tariff-eligible goods from each state shipped to China in 2017.

Because of the US database's limitations, the totals include some foreign-sourced goods that may not be subject to China's tariffs. Those goods represent a small portion of the overall values.

Additionally, the database measures exports using a system called Origin of Movement. This measures where exports are sent from rather than where they are produced. While research shows that Origin of Movement can be a solid proxy for production, the Census Bureau data may provide an undercount for some upstream producers.

For instance, some farmers in the Midwest ship their soybeans to Louisiana for transport, which increases the count for Louisiana. Given the fact that Louisiana still relies on the shipping and sales for its economy, the data is still helpful to evaluate the pain from the tariffs — but it may undercount the lost value to some upstream producers.

There are eight US states that exported more than $1 billion worth of tariff-eligible goods to China in 2017:

1. Texas: Tariff-eligible export amount: $8,022,380,040

In Texas, the biggest hit will come from crude oil and propane. The state sent $3.7 billion worth of crude oil to China last year, and $1.7 billion worth of propane.



2. Louisiana: Tariff-eligible export amount: $6,627,390,388

Some farmers in the Midwest ship their soybeans to Louisiana for transport, which increases the count for Louisiana.

Given the fact that Louisiana still relies on the shipping and sales for its economy, the data is still helpful to evaluate the pain from the tariffs — but it may undercount the lost value to some upstream producers.



3. Washington: Tariff-eligible export amount: $5,231,988,100



See the rest of the story at Business Insider


Fund managers criticise deteriorating quality of research


Intel Navin Shenoy

  • Intel's former CEO Brian Krzanich was out of the job so suddenly, the company had to appoint an interim CEO while it embarks on a search.
  • That means it's time to play: who will be the next CEO?
  • Intel has always hired from within, but says it will be looking for candidates inside and outside the office.
  • Here's a list of the candidates people are buzzing about based on our conversations with people, online water cooler chat and a few of our own thoughts.


With Brian Krzanich's sudden and surprise departure from Intel's corner office, it's time to play the who-will-take-his place game.

Intel has a long tradition of grooming its CEOs from within its internal ranks.

That makes a lot of sense given how huge the company is across so many different electronics markets, from PC processors to memory to networking and so on.

Most importantly, the CEO of Intel needs to balance two very distinct jobs:

1. Keeping a global network of multi-billion dollar chip manufacturing facilities running smoothly and without any hiccups.

2. Having the vision to focus on the right products and to steer the company into new markets (without missing the next big thing, as Intel famously did in mobile).

: Intel CEO Brian Krzanich speaks during an Intel press event for CES 2017Finding someone who can do both of those jobs is no easy feat, which is why the company has always ended up going with someone internal. 

But times are changing. The company is still recovering from missing the boat on the mobile platform shift. And some chip industry insiders are buzzing that now may finally be the time for Intel to break with tradition.

Intel itself said, quite deliberately, that it will be looking at CEO candidates externally, as well as internally — and for good reason. Most of the top internal candidates are relatively new hires. So if you're going to go with someone who hasn't been there very long, it opens to door to going with fresh blood altogether.

The most likely candidates internally are:

Bob Swan, who is currently interim CEO. He joined Intel in 2016 as CFO, and he may looking at this as an extended job interview. He may succeed and nab the top role permanently for himself.

The main downside to Swan is that he's a straight up financial guy, not an engineer. He was the CFO of eBay for nine years, and also worked at investing firm General Atlantic. To succeed, he'd have to build a brain-trust of execs that could run the technical side of the business, and fix Intel's 10nm (and beyond) chip fabrication issues.

Intel Murthy RenduchintalaNavin Shenoy joined Intel in 1995 and currently runs Intel's all important data center group. He's the classic choice as he grew up inside Intel and cut his teeth as the technical assistant to former Intel CEO Paul Otellini. He's known internally for having the product vision that Intel needs right now.

Venkata Renduchintala, known at Intel as Murthy. Renduchintala was hired away from Qualcomm in 2016 and currently runs Intel's hefty client device products and its hot up-and-coming Internet of Things (IoT) products.

He's got the technical chops, though his management style has raised eyebrows in the past. In a 2016 Business Insider profile one person described Renduchintala as being "loud" and "not afraid to say" his opinion, while another called his leadership style "command and control" where he often "dressed down" underperforming executives at Qualcomm.

Intel Jim KellerRaja Koduri was hired away from AMD in 2017. He runs a new group that was formed when he was hired —Intel's Core and Visual Computing Group, which deals with graphics and other visual technologies. 

Jim Keller is the newest hire, joining in April from his short-lived stint running Tesla's self-driving autopilot group (a job at Tesla that has seen a lot of turnover). Prior to that, Keller spent most of his career in semiconductors for AMD and others. He's a long-shot but if Intel wanted to bring in fresh blood for its CEO while still maintaining its tradition of hiring from within, Keller could be the guy. He currently leads chip engineering.

Top outsiders

If Intel is serious about looking outside the company, one place it might want to prowl is the Taiwan Semiconductor Manufacturing Company (TSMC), the giant chip manufacturer that makes processors for everyone from Apple to Qualcomm.

Rick Cassidy is CEO of TMSC's North America unit. TSMC's semiconductor manufacturing process is kicking Intel's butt. As Intel has struggled to get its 10nm chips into production while dreaming of its 7nm offerings, TSMC not only already has 10nm chips available, earlier this year it started mass producing 7nm, and is working on 5nm, the chip that is supposed to be the "end of Moore's Law." Hiring someone from TSMC might be the boost Intel needs.

AMD Lisa SuSanjay Jha is the recently departed CEO of Intel's fab rival Global Foundries, who left that role March after four years as CEO. He's also the former COO of Qualcomm. It's not clear why Jha left, whether he was falling short of expectations or if he quit on his own. Global Foundries has a reputation of being a hard place for CEOs, and has gone through four CEOs now in less than a decade, EE Times' Rick Merritt reports.

The dream CEO for Intel employees is AMD's Lisa Su. It seems far fetched that she would jump ship though. Su has been crushing it at AMD and she'd be leaving for AMD's all-time arch rival.

People are also talking about Renee James, the one time heir apparent to Krzanich. But she is unlikely to go back to Intel. James spent 28 years at Intel and left in 2015 and earlier this year came out of stealth as CEO of her own chip company, Ampere. She's deliriously happy doing her own startup, she previously told Business Insider.

SEE ALSO: Former Intel board member who left a month ago was totally surprised by the CEO's resignation

SEE ALSO: http://www.businessinsider.com/the-most-powerful-female-engineers-of-2018-2018-4

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SAN FRANCISCO (Reuters) - An overhauled telecommunications sector featuring most of the so-called FANG stocks could debut as Wall Street's hottest bet when it kicks off in September, boosted by a rising wave of media and television acquisitions.


(Reuters) - ZTE Corp is expected to deposit $400 million in an escrow account in a U.S. bank in the "next couple of days," the last step the Chinese company must take before a ban on U.S. suppliers can be lifted, a U.S. Department of Commerce official told Reuters on Friday.


VIENNA (Reuters) - OPEC agreed on Friday on a modest increase in oil production from next month after its leader Saudi Arabia persuaded arch-rival Iran to cooperate, following calls from major consumers to curb rising fuel costs.


jeff bezos amazon ceo

  • Amazon employees signed and sent a letter to CEO Jeff Bezos asking the company to stop selling facial-recognition software to law-enforcement agencies and to cease its business dealings with Palantir.
  • The letter was signed by over 100 Amazon workers, including senior-level engineers, sources told Business Insider.
  • You can read the full letter below.

On Thursday a group of Amazon employees sent a signed letter to CEO Jeff Bezos calling on the company to stop selling a sophisticated facial-recognition software to law-enforcement agencies.

Business Insider has learned that more than 100 Amazon workers signed the letter, including some senior engineers.

Those who signed the letter want the company to cease "providing infrastructure to Palantir (the company that builds predictive policing tools) and any other Amazon partners who enable (Immigration and Customs Enforcement)," according to documents reviewed by Business Insider. They also ask that Amazon "implement strong transparency and accountability measures" that identify which law enforcement agencies are already using the company's technology.

Last May, the American Civil Liberties Union reported that Amazon had “officially entered the surveillance business.” The ACLU said that it had seen Amazon’s marketing materials for Rekognition and that it had focused on selling the software to governments and police. The ACLU also wrote that Rekognition, powered by artificial intelligence, could in real time "identify, track and analyze" the faces of up to 100 people from a single image.

In a blog post three weeks ago, Dr. Matt Wood, general manager of artificial intelligence at Amazon Web Services, defended Rekognition, saying the technology was already benefitting society by "preventing human trafficking" and "inhibiting child exploitation." 

"Each organization choosing to employ technology must act responsibly," Wood wrote. "AWS takes its responsibilities seriously. But we believe it is the wrong approach to impose a ban on promising new technologies because they might be used by bad actors."

The letter to Bezos is the latest in a recent string of employee revolts at some of the tech sector's biggest companies. Many tech workers don't want to help create software or other tech that might be used to wage war or conduct surveillance on the public. The Hill first reported about the existence of the letter.

 

At Google, employees not only circulated a petition that demanded Google stop supplying artificial-intelligence tools that assisted the US Department of Defense to analyze drone-video footage, but someone within the company also leaked some embarrassing emails that showed the extent of management's ambitions on working with the military.

Eventually, Google relented, and earlier this month the company promised not to make AI weapons or use the technology for anything that could cause harm.

Microsoft employees followed suit by calling on management to end its cloud-computing contract with the Immigration and Customs Enforcement, or ICE.

Read the full letter to Amazon CEO Jeff Bezos below:

Dear Jeff,

We are troubled by the recent report from the ACLU exposing our company’s practice of selling AWS Rekognition, a powerful facial recognition technology, to police departments and government agencies. We don’t have to wait to find out how these technologies will be used. We already know that in the midst of historic militarization of police, renewed targeting of Black activists, and the growth of a federal deportation force currently engaged in human rights abuses — this will be another powerful tool for the surveillance state, and ultimately serve to harm the most marginalized. We are not alone in this view: over 40 civil rights organizations signed an open letter in opposition to the governmental use of facial recognition, while over 150,000 individuals signed another petition delivered by the ACLU.

We also know that Palantir runs on AWS. And we know that ICE relies on Palantir to power its detention and deportation programs. Along with much of the world we watched in horror recently as U.S. authorities tore children away from their parents. Since April 19, 2018 the Department of Homeland Security has sent nearly 2,000 children to mass detention centers. This treatment goes against U.N. Refugee Agency guidelines that say children have the right to remain united with their parents, and that asylum-seekers have a legal right to claim asylum. In the face of this immoral U.S. policy, and the U.S.’s increasingly inhumane treatment of refugees and immigrants beyond this specific policy, we are deeply concerned that Amazon is implicated, providing infrastructure and services that enable ICE and DHS.

Technology like ours is playing an increasingly critical role across many sectors of society. What is clear to us is that our development and sales practices have yet to acknowledge the obligation that comes with this. Focusing solely on shareholder value is a race to the bottom, and one that we will not participate in.

We refuse to build the platform that powers ICE, and we refuse to contribute to tools that violate human rights.

As ethically concerned Amazonians, we demand a choice in what we build, and a say in how it is used. We learn from history, and we understand how IBM’s systems were employed in the 1940s to help Hitler. IBM did not take responsibility then, and by the time their role was understood, it was too late. We will not let that happen again. The time to act is now.

We call on you to:

1 . Stop selling facial recognition services to law enforcement
2. Stop providing infrastructure to Palantir and any other Amazon partners who enable ICE.
3. Implement strong transparency and accountability measures, that include enumerating which law enforcement agencies and companies supporting law enforcement agencies are using Amazon services, and how.

Our company should not be in the surveillance business; we should not be in the policing business; we should not be in the business of supporting those who monitor and oppress marginalized populations.

Sincerely,
Amazonians

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23:05 The Dow ends its 8-day losing streak (Business Insider)

Suhail Mohamed Al Mazrouei opec oil

The Dow Jones industrial average ended its eight-day losing streak Friday, lifted by energy stocks amid a crude rally. The dollar fell, and Treasury yields inched higher. 

Here is the scoreboard:

Dow Jones industrial average: 24,580.61 +118.91 (+0.49%)

S&P 500: 2,760.56 +10.80 (+0.39%)

  1. OPEC reached a deal to ease supply cutsThe cartel said it will gradually increase output by a nominal one million barrels per day, which analysts estimate will translate to about 600,000 additional barrels per day hitting the market. Crude rallied more than 5% following the news.
  2. The EU began enforcing retaliatory tariffs on $3.4 billion worth of US goods. The tariffs, which come after President Donald Trump hit the EU with levies on steel and aluminum imports to the US, target politically-sensitive American goods like bourbon and motorcycles.
  3. Trump threatened to slap a hefty tariff on EU car imports to the US. Trump wrote in a tweet that if the European Union doesn't "remove" tariffs on the US, his administration could impose a 20% levy on "all of their vehicles coming into the US."
  4. Signs of weakness are emerging in the Canadian economy. The country's consumer price index flatlined at 2.2% in May, Statistics Canada said ahead of the central bank's July 11 policy meeting. In separate data, retail sales dropped 1.2% last month.
  5. A private survey showed eurozone business activity picking up in the second quarter. IHS Markit said its purchasing managers' index, which is widely used to measure economic growth, rose 0.7% in June. 
  6. Bitcoin approached its lowest level of the yearIt shed more than 7% to $6,221 amid broader pressure on the cryptocurrency market. Ethereum and bitcoin cash both sank about 10% each. 

And a look at the upcoming economic calendar:

  • OPEC+ continues meetings in Vienna to discuss supply cuts.
  • Turkey holds its presidential election.

SEE ALSO: Housing affordability in America is its worst in nearly a decade, and there's one clear culprit

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NOW WATCH: Trump pitched peace to Kim Jong Un with this Hollywood-style video starring Kim as the leading man



FRANKFURT (Reuters) - Harley-Davidson Inc could be forced to raise prices in Europe due to EU tariffs on U.S. goods, hitting buyers of new motorcycle models when they are shipped to dealers later in the year, the head of its central European business said.


Turkish President Tayyip Erdogan greets his supporters during a ceremony in Istanbul, Turkey January 27, 2018. Yasin Bulbul/Presidential Palace/Handout via REUTERS


The lira rose Friday ahead of Turkey's historic snap elections this weekend, which will also mark the country's shift from a parliamentary system to a more powerful presidency. 

The lira was up 1.3% to 4.6672 versus the dollar at 2 p.m. ET. Turkey's central bank has been trying to prop up the lira ahead of the election, raising rates earlier this month for the third time in two months to 17.75%.

But Jameel Ahmad of FXTM said investors have largely ignored those rate hikes amid expectations that President Tayyip Erdogan, a self-proclaimed "enemy" of interest rates, will win the election, which he moved up by more than a year as his opponents began gaining ground. 

"The view of Erdogan is that low interest rates will encourage investment into Turkey because investors will become encouraged to take advantage of lower borrowing costs," Ahmad said. "This view is not economically incorrect, but it also does not fully take into account the dangerous effect the Lira depression is having on the Turkish economy."

The lira hit an all-time low last month after Erdogan said in an interview with Bloomberg TV that he would exert more influence over the economy, raising concerns about the independence of Turkey's central bank under another Erdogan term.

Ahmad said investors need to closely monitor how the lira reacts to the election "in case it causes a ripple effect on other global markets." If the lira hits another record low, it could lower risk appetite for other emerging markets currencies which he said are already vulnerable amid global trade tensions and a stronger dollar.

"We can’t afford to look at the weekend Turkey election as an idiosyncratic event," Ahmad said.

Turkey's fiscal policies are also at risk of weighing on the lira in the near-term. A team of Morgan Stanley strategists led by Hans Redeker wrote in a research note that the lira is likely to continue to weaken post-election should there be no change to its "imbalanced" growth model.

"The credit expansion and loosening fiscal policy will continue to worsen the imbalance and keep the current account deficit wide," Redeker wrote. 

The lira is down 23% against the dollar this year. 

Screen Shot 2018 06 22 at 2.27.03 PM

SEE ALSO: Oil is rallying after OPEC reportedly strikes a deal to raise production

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NOW WATCH: This top economist has a radical plan to change the way Americans vote



21:19 Donald Trump and the 1930s playbook (Financial Times)
Trade wars and the targeting of minority groups in the US and some EU countries have strong historical echoes


Intel CEO Brian Krzanich

  • Wall Street analysts are saying Intel's crazy week of big news is mostly positive.
  • Intel CEO Brian Krzanich resigned after violating company policy, and the company raised its second-quarter earnings guidance. 
  • Shares slid on the news. 
  • Watch Intel trade in real time here. 

Wall Street analysts are saying investors should hold their horses on selling Intel shares.

Shares slid 2% on Thursday after the company announced CEO Brian Krzanich was resigning due to violating company fraternization policies. The company also raised its second-quarter earnings-per-share guidance.

While Wall Street analysts have mixed opinions on the news of Krzanich's resignation, they point to the revised earnings guidance as evidence things are looking up for Intel. The chipmaker said it now sees second-quarter EPS at $0.99, up from $0.85 when it reports on July 26.  

"Management change is always uncertain and some investors are drawing incrementally negative conclusions around 10 nanometers," UBS analyst Timothy Arcuri wrote in a note out to clients (10 nanometers is the smaller chip Intel wants to produce). But Arcuri sees both the Krzanich news and EPS news as net positive.

"We have maintained estimates well above Street and are raising them slightly again to reflect the positive pre- announcement," he said. "We are raising our estimated 2018 revised EPS (non-GAAP) to ~$69B." 

Arcuri has a $70 per share price target, well above the Wall Street consensus of $60.18.

Meanwhile, JPMorgan analyst Harlan Sur raised his price target on the chipmaker to $68 a share from $65. "We see this preannouncement as further proof of strong data center cloud spending - a key investment theme for us this year," Sur wrote in a note out top clients.

Perhaps most importantly, he thinks data center revenue looks promising going forward. "Overall, we have strong confidence that interim CEO Swan will continue to steer Intel in the direction of increased profitability and free cash flow, driven by the strength in data center compute and other data-centric businesses," Sur added. 

And while most analysts are confident in both the interim CEO and management's ability to find a good replacement CEO, Credit Suisse analyst John Pitzer actually sees the Krzanich news as a negative. Still, he's bullish. He sees the EPS revision outweighing Krzanich's resignation. 

"Krzanich’s departure is a negative and increases near-term uncertainty," Pitzer wrote in a note out to clients. "We continue to see upside to our 2018 and 2019 EPS estimates and continue to rate the stock Outperform." His price target is $65. 

Intel is down 4.94% this week, but up 14.11% this year. 

Screen Shot 2018 06 22 at 1.28.49 PM

SEE ALSO: Trump threatens to slam a massive tariff on European cars, which could cause economic chaos

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NOW WATCH: Sneaky ways Costco gets you to buy more





20:01 How British is a Mini? (BBC News)
When it comes to symbols of British manufacturing, it doesn't get more iconic than this - but how British is the Mini?


Screen Shot 2018 06 22 at 11.13.22 AM

  • Red Hat is getting smoked after giving disappointing second-quarter guidance. 
  • It beat on first-quarter 2019 earnings, and Thursday, announced a $1 billion share buyback plan. 
  • Still, the stock is down. 
  • Watch Red Hat trade in real time here.

Shares of Red Hat are getting smoked on Friday, to the tune of 10.52% to $148.30 apiece. The drop comes after the open-source-software-products firm gave disappointing guidance Thursday in its first-quarter 2019 earnings release. 

Although first-quarter revenue of $814 million and adjusted earnings-per-share of $$0.72 beat Wall Street estimates, the guidance was worse-than-expected. 

Red Hat's press release gave guidance of $822 million-$830 million in revenue for the second quarter, below Wall street's expectation that guidance would be $855 million. Red Hat's guidance for second-quarter EPS is $0.81, below Wall Street's expected guidance of $0.89. 

The company also announced a $1 billion share buyback plan in another press release, which seemed to do not much for the stock. 

Red Hat shares were largely flat for the week until it released guidance. They're now down 13.7% this week. 

SEE ALSO: Trump threatens to slam a massive tariff on European cars, which could cause economic chaos

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Shares of European carmakers fall on new risk of trade war following president’s tweet


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Trump threatens to slam a massive tariff on European cars

President Donald Trump on Friday threatened to slam huge tariffs on imported cars from the European Union, a massive new threat in the escalating trade conflict between the allies.

Trump had directed the Commerce Deparment to launch an investigation into imported autos in May, similar to the procedure that led to recent tariffs on steel and aluminum imports. While the results of that investigation are still weeks away, Trump raised the specter of tariffs on Twitter.

"Based on the Tariffs and Trade Barriers long placed on the US and it great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the US," Trump tweeted. "Build them here!"

Elliott Management has hired a new executive from Citi

Paul Singer's Elliott Management has hired Jean-Yves Magnan as deputy chief financial officer, according to people familiar with the matter.

Magnan, who was previously chief financial officer of Citi's cards division, started at the $35 billion hedge fund at the end of May.

Magnan's hiring shows how Elliott is trying to deepen its bench of C-suite executives as the fund gets larger and more complex.

Who should be Intel's next CEO? These are the top candidates people are buzzing about

With Brian Krzanich's sudden and surprise departure from Intel's corner office, it's time to play the who-will-take-his place game.

Intel has a long tradition of grooming its CEOs from within its internal ranks.

That makes a lot of sense given how huge the company is across so many different electronics markets, from PC processors to memory to networking and so on.

Intel itself said, quite deliberately, that it will be looking at CEO candidates externally, as well as internally — and for good reason. Most of the top internal candidates are relatively new hires. So if you're going to go with someone who hasn't been there very long, it opens to door to going with fresh blood altogether.

Here are the candidates people are buzzing about to replace Krzanich. 

JPMorgan's summer reading list 

JPMorgan has released its 19th summer annual reading list.

The banking behemoth's summer reading list of 10 nonfiction titles includes books for readers of various interests. Some books focus on, yes, business. But they also touch on ideas applicable to all, such as leadership and group dynamics. Other books are about history, art, travel, and culture.

Here's the list. 

 

In markets news

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Paul Singer

  • Paul Singer's Elliott Management has hired Jean-Yves Magnan as deputy chief financial officer, according to people familiar with the matter.  
  • Magnan, who was previously chief financial officer of Citi's cards division, started at the $35 billion hedge fund at the end of May. 
  • Magnan's hiring shows how Elliott is trying to deepen its bench of C-suite executives as the fund gets larger and more complex. 

Paul Singer's Elliott Management has hired Jean-Yves Magnan as deputy chief financial officer, according to people familiar with the matter.  

Magnan, who was previously chief financial officer of Citi's cards division, started at the $35 billion hedge fund at the end of May. 

Magnan's hiring shows how Elliott is trying to deepen its bench of C-suite executives as the fund gets larger and more complex.

While Elliott has traditionally been known as an activist investor that has shaken up companies like data storage company EMC and energy producer Hess, it has lately expanded into new areas such as private equity. Assets under management have grown 60% in the last five years and the number of employees has increased from around 300 to 450 during that time. 

A spokesman for Elliott declined to comment. A Citi spokeswoman confirmed Magnan had left the bank but did not provide further details. 

Magnan spent the majority of his career at Citi, which included a role as CFO of the bank's Hong Kong operations and head of financial planning and analysis for its consumer bank, according to his LinkedIn profile. 

Elliott has made a number of other hires from big banks in the last few years.

Manda D'Agata joined Elliott in 2016 as treasurer from Goldman Sachs, and was recently promoted to co-head of operations. 

The fund's chief operating officer, Zion Shohet, also joined Elliott in 2015 from Citi. 

SEE ALSO: The hedge-fund manager who says he's a #MeToo scapegoat plans to take legal action against $50 billion D.E. Shaw

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NOW WATCH: Millennials are leading an investment revolution — here's what makes their generation different



The European Union has gone ahead with retaliatory duties against $2.8bn worth of US-made products.


The eurozone agrees a long-awaited deal, which pushes back the repayment schedule for Greece's debt.


Reusable bags, bottles and containers are the key to success for these buyers in Birmingham.


Asset manager promises bonuses after chief investment officer clashed with co-founder


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