Latest news with #OddLots'
New York Times
13-04-2025
- Business
- New York Times
What to Know About Trump's Antitrust Efforts Against Tech Giants
The Trump administration isn't letting up on the tech giants. On Monday, the Federal Trade Commission will face off with Meta in court over claims that the social media giant snuffed out nascent competitors when it bought Instagram and WhatsApp. And on April 21, the Justice Department will argue that a federal judge should force Google to sell its Chrome web browser to limit the power of its search monopoly. Both cases, which helped set into motion a new era of antitrust scrutiny, were filed during President Trump's first term in office. They were advanced by the Biden administration, which also filed monopoly lawsuits against Amazon, Apple and Google's ad technology business. Investors in Silicon Valley and on Wall Street hoped that Mr. Trump might show technology companies more deference during his second term, as he promised to deregulate industries. Some legal experts think the administration could still take a lighter hand on blocking mergers and setting proactive regulations for tech. But so far, Mr. Trump's appointees have promised to continue much of the scrutiny of the biggest tech companies, despite the industry's hopes. 'I think that they may not have fully focused on how much the first Trump presidency had to do with setting in motion this re-examination of tech,' said Bill Kovacic, a former F.T.C. chairman. Here's what to know. Who is in charge of antitrust enforcement now? Mr. Trump appointed Andrew Ferguson as chair of the F.T.C., which enforces antitrust and consumer protection laws. Mr. Ferguson, a lawyer who spent much of his career working for powerful Republican senators, has said he wants to increase scrutiny of the ways that social media companies decide to take posts down. Conservatives have complained for years that platforms like Facebook and YouTube disproportionately censor right-leaning viewpoints. 'I will throw every resource the agency has at prosecuting the cases against Big Tech that we've got going,' Mr. Ferguson said in an appearance on the Bloomberg podcast 'Odd Lots' this year. The new leader of the Justice Department's antitrust division, Gail Slater, a veteran tech and media lawyer, worked in the White House during Mr. Trump's first term. She has also pledged to enforce antitrust laws aggressively. 'It's now a bipartisan issue, and there's a consensus around the need for robust antitrust enforcement,' Ms. Slater said at an event hosted this month by Y Combinator, the Silicon Valley start-up accelerator, which has pushed for more antitrust scrutiny of the tech giants. Where do the major antitrust lawsuits against the tech giants stand? Five government cases accuse tech companies of maintaining illegal monopolies, and all are moving through the courts. The companies deny the allegations. What about tech industry mergers and acquisitions? The Biden administration tried and failed to block numerous tech deals, including Meta's purchase of a small virtual reality start-up, Within. The push to stop acquisitions outraged investors who back small companies that want to cash out by being acquired by a tech giant. Mr. Trump's appointees say they want to get out of the way of acquisitions that don't present a competitive problem. Ms. Slater has expressed an openness to companies' proposing settlements — such as selling off similar assets — which can help resolve concerns about deals. In late January, the Justice Department sued to block the business software company Hewlett Packard Enterprise from buying Juniper Networks, a networking firm, for $14 billion. It was the first lawsuit to challenge a tech deal in Mr. Trump's second term. During the first Trump administration, the Justice Department unsuccessfully challenged AT&T's purchase of Time Warner. What does this mean for the artificial intelligence race? Last year, the Justice Department and the F.T.C. agreed to divide up responsibility for investigating whether the biggest players in artificial intelligence were violating antitrust laws. The Justice Department started investigating Nvidia, while the F.T.C. took Microsoft and its partner, OpenAI. It is unclear whether those investigations will result in lawsuits. The Trump administration has promised to clear the way for American companies to develop A.I., including rescinding a Biden-era executive order that put guardrails on the use of the technology. The administration has solicited the industry's input on how best to move forward with policy around the technology, an opening that companies and investors took to lobby for fewer rules. 'I think it is extremely important that we protect competition in the A.I. space, but I think it is equally important that the government not race to regulate A.I.,' Mr. Ferguson said on Bloomberg TV in March.
New York Times
19-03-2025
- Business
- New York Times
What's at Stake in Trump's F.T.C. Purge
'Inconsistent with my administration's priorities' Business leaders and deal makers have already been grappling with a whirlwind of chaos from the Trump administration across various fronts, which they have said has disrupted key decisions. But in many ways, President Trump's firing of the Federal Trade Commission's two Democratic commissioners is a major shock to the system, another challenge to the status quo — and Supreme Court precedent — that is stoking uncertainty for corporate America. 'Your continued service on the F.T.C. is inconsistent with my administration's priorities,' a White House official wrote to the two Democratic commissioners, Rebecca Slaughter and Alvaro Bedoya. Their firing leaves just two Republican commissioners at the agency, which is charged with overseeing consumer protection and antitrust laws and normally has five commissioners, three belonging to the president's party. A third Republican, Mark Meador, is still awaiting Senate confirmation. The White House official justified the decision by essentially saying that the Supreme Court's decision in the 1935 case known as Humphrey's Executor, which held that F.T.C. commissioners can't be fired over policy disagreements, doesn't apply here. The F.T.C.'s chair, Andrew Ferguson, said he had 'no doubts' about the constitutionality of the move. Slaughter and Bedoya plan to fight the decision in court. Their firings raise questions about how the agency operates. While it can continue working with just two commissioners, it was designed to be bipartisan. Several legal experts say that while minority commissioners don't necessarily have decision-making power, their opinions can help shape judges' rulings on cases involving the F.T.C. Ferguson himself recently spoke in favor of having minority commissioners: 'I wrote 400-plus pages of dissents during my time as a minority commissioner,' he told Bloomberg's 'Odd Lots' podcast. 'I think that that adds value.' It also thrusts Trump's desire for more control over agencies into the spotlight. The president has already issued an executive order seeking more oversight over independent regulators like the F.T.C., the S.E.C. and the National Labor Relations Board. A big question is whether Trump tries a similar move at those agencies. He already fired a Democratic commissioner at the N.L.R.B., though a court reinstated her; the administration is appealing that decision. Critics say that the move could erode the agencies' effectiveness. Their traditional bipartisan setup gave the regulators credibility with judges, they say. 'It will now be a question of whether cases result from good professional judgment or direct political intervention,' Bill Kovacic, an F.T.C. chair in the George W. Bush administration, told Bloomberg. Jonathan Kanter, the Justice Department's antitrust chief in the Biden administration and a former F.T.C. lawyer, wrote on LinkedIn that the move defied 'direct Supreme Court precedent, contravenes the unambiguous will of Congress, and elevates party politics above consumers, workers, and small businesses.' What will the Supreme Court do? Those hoping it will overturn the move may point to Chief Justice John Roberts and Justice Amy Coney Barrett siding with liberal colleagues against Trump this month, as well as Roberts' rare public rebuke of the president over his attacking a district court judge over a political disagreement. But Trump's move is rooted in what's known as the unitary executive theory, a legal interpretation of the Constitution that has been embraced by several justices. And The Times notes that Roberts has generally given the presidency wide latitude. Tesla gains key protections from the Justice Department. Attorney General Pam Bondi on Tuesday called a recent string of vandalism incidents at Tesla dealerships 'domestic terrorism' that would be prosecuted with 'severe consequences' for the perpetrators, a further sign of Elon Musk's influence in the Trump administration. Separately, the electric vehicle maker won approval from California regulators to operate its self-driving taxi service on the state's roadways. That hasn't helped the company's share price, which has more than halved since December as short-sellers circle. The state of a Russia-Ukraine cease-fire appears uncertain. Both Kyiv and Moscow accused each other of attacking each other's energy infrastructure, campaigns that have dealt serious damage to both countries' economies. Separately, President Vladimir Putin of Russia gave 683 Capital Partners, a U.S. hedge fund, permission to acquire the securities of Russian companies owned by other firms and resell them to two Russian entities. Two NASA astronauts safely return to Earth. Suni Williams and Butch Wilmore splashed down in the waters off the coast of the Florida Panhandle after a SpaceX capsule retrieved them from the International Space Station months after they were meant to come back. (They were greeted by a pod of dolphins.) The episode underscores the woes bedeviling Boeing, whose Starliner was meant to retrieve the astronauts but experienced propulsion issues, allowing its archrival SpaceX to claim credit for bringing them home. Musk's dismantling of U.S.A.I.D. is probably unconstitutional, a federal judge rules. The judge, Theodore Chuang in Maryland, found that the billionaire had acted as a U.S. officer without having been appointed as one by President Trump. It appears to be the first time a judge has sought to directly constrain Musk and his so-called Department of Government Efficiency. Separately, court filings show that Amy Gleason, who the Trump administration said was the acting director of that department, had also been working at the Department of Health and Human Services since February. Will Powell blink today? The S&P 500 has hovered around correction territory for weeks as President Trump's trade war and economic fears weigh on global markets. A number of economists see all of that as potentially torpedoing the Fed's efforts to pull off a soft-landing recovery. That raises a big question: Will Jay Powell, the Fed chair, deliver on Wednesday the clarity business leaders have craved about the effects of Trump's tariff moves? The backdrop: Business sentiment has weakened. Inflation fears are growing. Consumers are beginning to cut back on purchases. And some Wall Street economists have downgraded their growth outlooks. Oh, and that's beginning to dent some of Trump's poll numbers. Here's what to watch for at Powell's news conference at 2:30 p.m. Eastern: The economic outlook is muddled. The labor market has held up, but there are flags elsewhere. 'Credit spreads — the gap between corporate bond yields and U.S. Treasury bond yields — have widened,' Lawrence Gillum, the chief fixed-income strategist for LPL Financial, wrote in a research note on Tuesday. 'This widening is seen by some as a potential recession signal, reflecting greater risk aversion and unease about the economic outlook.' He added that 'this move may be more of a correction scare than a recession scare.' Trump and his top economic team haven't allayed the anxiety. In recent weeks, they suggested that a recession was not only possible, but that Trump's policies were also 'worth it' even if they inflicted some economic pain. On Tuesday, Treasury Secretary Scott Bessent tried to tamp down such talk: 'The economy in the first quarter is doing better than the media is reporting,' he told Maria Bartiromo of Fox Business Network. Further muddying the picture: Howard Lutnick, the commerce secretary, has told people privately that he's 'not thrilled' with Trump's on-again-off-again approach to tariffs, CNN reports. Powell will probably be peppered with tariff questions. So far, he has dodged the topic, stressing the central bank's political independence. But as lackluster economic data mounts, will he be more candid about its potential fallout? Google's bid for Wiz is a major antitrust test Google's blockbuster bid for the cybersecurity start-up Wiz is the first major test of how tough the Trump administration will treat Big Tech mergers. The proposed $32 billion acquisition would be Google's largest. If successful, the deal could become a model for other mergers. Google, like other tech giants, quickly cozied up to President Trump after he won, and its C.E.O., Sundar Pichai, was prominently seated at the his inauguration alongside other tech leaders. One way to look at it: This was the first major deal put together under a new political calculus. Another view: this is the second time that Google has made a big pitch for the fast-growing company. (Wiz executives last summer walked away from Google's $23 billion offer.) Does that suggest a new bullishness for deals in the Trump era, or just that two parties that know each other well are once again flirting with a tie-up? Either way, Wall Street advisers are closely watching the deal. Some recent context: In January, the Justice Department sued to block Hewlett Packard Enterprise's $14 billion acquisition of its rival Juniper Networks, but that transaction was announced before Trump re-entered office. Uncertainty has chilled deal-making. Companies were optimistic that the departure of former President Joe Biden's tough antitrust enforcers would lead to a more friendly regulatory environment, but deals have dropped under Trump. In a recent note, Goldman Sachs lowered its estimate for growth in U.S. deals to a 7 percent increase, down from 25 percent. Google faces an uphill battle no matter which agency handles the review. Andrew Ferguson, the F.T.C.'s head, presents himself as business-friendly, but his crusade against companies he says practice censorship muddies the picture. And Gail Slater, who was recently confirmed to lead Trump's antitrust division at the Justice Department, is no big fan of big tech. Is there hope for this deal? Google clearly knows it's not a sure thing. The merger agreement includes a $3.2 billion breakup fee to Wiz, or about 10 percent of the deal value. That's much steeper than usual, and a sign that the parties acknowledge that there is a regulatory risk. Google also has most likely already factored in making some concessions to close the deal. Deals Politics, policy and regulation Best of the rest
Russia Today
04-03-2025
- Business
- Russia Today
‘Economic heart attack': Ray Dalio sounds alarm on US debt
Washington has to immediately commit to cutting the deficit or face the risk of a major debt crisis within the next three years, billionaire investor Ray Dalio, founder of Bridgewater Associates, told Bloomberg on Monday. The bearish outlook stems from the US federal budget deficit, which rose to $1.8 trillion in the last fiscal year, ending September 30, 2024. The staggering figure marks the third-largest federal deficit in US history, after the record-breaking pandemic relief-driven deficits of $3.132 trillion and $2.772 trillion in 2020 and 2021, respectively. For comparison's sake, the GDP of France was approximately $3 trillion in 2023. 'If you don't do it, you're going to be in trouble,' the billionaire suggested in the outlet's weekly 'Odd Lots' podcast. 'I can't tell you exactly when it'll come, it's like the heart attack,' he emphasized. 'You're getting closer, my guess would be three years, give or take a year, something like that.' The billionaire insisted that 'there's a solution here' that's 'doable' to address the government deficit and an impending debt crisis. US national debt currently stands at $36.2 trillion, according to the Treasury Department. It crossed the $35 trillion mark for the first time last summer. Dalio's comments come as the administration headed by US President Donald Trump is working to pass a massive tax cut bill that would also include funds to increase spending on defense and immigration enforcement. Last week, the US House of Representatives narrowly passed a budget framework designed to cut up to $2 trillion in spending and allow up to $4.5 trillion in tax cuts over the next 10 years. The budget plan would also raise the statutory debt limit by $4 trillion. According to Dalio, the projected deficit will be about 7.5% of the country's gross domestic product, once Trump's tax cuts take effect. The billionaire investor urged for it to be cut to 3%, adding that it would 'mean that debts won't rise relative to incomes, and it will greatly improve supply and demand.'
