After four days of arguments in Federal District Court here, Uber agreed to provide Waymo with 0.34 percent of its stock. Uber is now valued at about $72 billion, which works out to about $240 million, according to Waymo.
Waymo, the self-driving car unit spun out of Google’s parent company, Alphabet, argued that Uber had colluded with a former Google engineer to steal technology related to laser-based sensors, a key component in self-driving cars. Uber said it had developed its technology on its own.
Who cares about deficits? Not Congress, it seems
One of the shortest shutdowns in U.S. government history is over, and Congress has reached a budget deal. The price is hundreds of billions in new spending.
Rand Paul, who temporarily halted the Senate’s vote on the deal, said this:
“I want people to feel uncomfortable. I want them to have to answer people at home who said, ‘How come you were against President Obama’s deficits and then how come you’re for Republican deficits?’ ”
Conservative House Republicans like the Freedom Caucus opposed the bill on similar grounds.
The critical take on deficit spending, from the lead editorial of this week’s Economist:
Democrats are to get more funds for child care and other goodies; hawks in both parties have won more money for the defense budget. Mr. Trump, meanwhile, still wants his border wall and an infrastructure plan. The mood of fiscal insouciance in Washington, D.C., is troubling.
What’s in the bill
The NYT has a rundown of some hard-to-spot items in the bill, including:
• The killing of the Independent Payment Advisory Board, which was meant to cap Medicare spending
• The extension of tax breaks for renewable and nuclear energy and a tax credit for carbon dioxide capture
• Special tax rates for timber sales
The immigration issue
Nancy Pelosi both praised the budget deal and said that she wouldn’t vote for it because it didn’t protect Dreamers. Some Democrats called on her to force her colleagues to block the deal, but others pointed to its funding for domestic programs.
How will the market rout impact the Federal Reserve’s March decision?
The S.&P. 500 and the Dow Jones industrial average both fell into correction territory on Thursday. Fed officials, though, have remained upbeat on their outlook for the United States economy and sanguine about the market’s tumble.
This week Robert Kaplan, the head of the Federal Reserve Bank of Dallas, said:
“I think it’s healthy that there is some correction, a little more volatility in markets…can be a healthy thing.”
William Dudley, the New York Fed President, said:
“If the stock market were to go down precipitously and stay down, then that would actually feed into the economic outlook, and that would affect my view in terms of the implications for monetary policy.”
But expectations for a March rate increase have begun to come down, reported Chelsey Dulaney of MoneyBeat. Traders are betting there is a 72 percent chance that the Fed will raise rates at its March meeting, down from 79 percent a week ago, according to CME Group data. For the year, investors now see only a 17.5 percent chance of four rate increases this year, compared to 24 percent a week ago, Ms. Dulaney wrote.
The big question remains: Is the underlying economy holding up? So far, probably yes.
More in markets
• The LJM Preservation and Growth Fund, an options mutual fund, essentially collapsed amid the turmoil. (FT)
• Most Americans have limited exposure to the stock market. (NYT)
The Amazon effect is coming for UPS and FedEx
Shares in the two big names in package delivery were down in premarket trading today. Why?
From Laura Stevens of the WSJ:
Amazon.com preparing to launch a delivery service for businesses, positioning it to directly compete with United Parcel Service Inc. and FedEx Corp.
Dubbed “Shipping with Amazon,” or SWA, the new service will entail the tech giant picking up packages from businesses and shipping them to consumers, according to people familiar with the matter.
Amazon expects to roll out the new delivery service in Los Angeles in coming weeks with third-party merchants that sell goods via its website, according to the people. Amazon then aims to expand the service to more cities as soon as this year, some of the people say.
Where else have investors felt fear about what Amazon might do to an industry?
• And retail, of course
— Michael de la Merced
The Washington flyaround
• White House officials knew as early as last fall that Rob Porter, the former White House staff secretary, faced domestic abuse allegations. The scandal has cast unflattering light on Mr. Porter’s boss, John Kelly. And some White House officials say it was all orchestrated by the former Trump aide Corey Lewandowski.
• Rand Paul is opposing the nomination of Marvin Goodfriend to the Fed, endangering the economist’s chances. (WSJ)
• Mr. Trump formally nominated Charles Rettig, a tax lawyer who fought the I.R.S., as its next leader. (NYT)
• CVS is raising its base hourly pay rate and improving employees’ health benefits because of the tax overhaul. (It also happens to be trying to buy Aetna for $69 billion.) (Axios)
• Penn Station and Newark Liberty International Airport are good examples of why the U.S. needs to upgrade its infrastructure, Jim Stewart writes. (NYT)
Will Broadcom and Qualcomm reach a deal?
Qualcomm rejected Broadcom’s revised $121 billion bid, saying it was an undervaluation and didn’t offer enough commitment if regulators pushed back. But it opened the door to negotiations.
Broadcom’s C.E.O., Hock Tan, responded by asking to meet this weekend.
But there’s still a lot they disagree on:
• Qualcomm wants more than $82 a share. Broadcom says its bid is “best and final.”
• Qualcomm says it needs a firmer commitment to completing a deal, even if antitrust regulators object. Broadcom has offered an $8 billion breakup fee in that case, as well as a 6 percent “ticking fee” if the deal takes more than 12 months to close.
What one shareholder wants: Steven Ré of Fairbanks Capital Management told the WSJ, “In a peaceful deal, they can probably talk Hock Tan up another $5, maybe $7.”
Also remember: Qualcomm’s shareholder meeting is scheduled for March 6. Broadcom is looking to unseat the entire board.
The deals flyaround
• L’Oréal says that it’s ready to buy out Nestlé’s 23 percent stake in it and hinted that it would sell its own stake in Sanofi, if necessary. (FT)
• Walmart is willing to invest up to $4 billion in Flipkart, valuing the Indian ecommerce giant at as much as $20 billion, an unnamed source says. (Bloomberg)
• Is Boeing in talks to buy Woodward, an airplane parts maker? Woodward says no, but unnamed sources told the WSJ yes. (WSJ)
• Starboard Value will seek to unseat the entire board of Newell Brands, unnamed sources said. (WSJ)
• Bayer has offered to sell its vegetable seeds business to win German regulatory approval for its $63.5 billion takeover of Monsanto. (Reuters)
• Alibaba’s Ant Financial is preparing to raise up to $5 billion at a $100 billion valuation, unnamed sources say. (Reuters)
• HNA, the troubled Chinese conglomerate, is selling $4 billion worth of U.S. office buildings to raise money. (Bloomberg)
• Shandong Ruyi Group of China bought control of the Swiss accessories company Bally from JAB Holding. (WSJ)
• Tilray, a medical marijuana producer and distributor, has raised 60 million Canadian dollars. (Tilray)
The Winter Olympics, brought to you by Samsung
Follow the NYT’s coverage of the games at Pyeonchang.
Behind the scenes, the games reflect cozy ties between South Korea’s government and Samsung — ones that continue to attract criticism.
More from Raymond Zhong and Park Jeong-eun of the NYT:
The company’s chairman, Lee Kun-hee, is a longtime member of the International Olympic Committee and lobbied for years behind the scenes to bring the Winter Games to South Korea. The government saw Mr. Lee as so pivotal to its Olympic dreams that after he was convicted of tax evasion in 2008, the country’s president then pardoned him expressly so he could resume lobbying for Pyeongchang.
And from Timothy Martin of the WSJ:
So extraordinary is the overlap between Samsung, South Korea and the Pyeongchang Games it is unlikely to be repeated, say IOC members and Olympics experts. Mr. Lee’s lobbying and Samsung’s close involvement are now considered inappropriate by some Olympics experts and voters.
Are Twitter and Snap contenders again?
After Snap and Twitter reported earnings this week, the view now seems to be that there is space for the two firms to make good money, even in the shadow of Facebook and Google, Peter Eavis writes:
Bright spots: Snap’s strong user growth, up 18 percent in the fourth quarter, is a sign that it remains a draw to younger users. And while Twitter’s U.S. user growth and advertising revenue were unimpressive in the fourth quarter, both looked solid in the rest of the world.
Breathing room: The fourth-quarter results bought both companies more time to prove themselves. And the financial pressure has lessened at Twitter. It is now churning out roughly half a billion dollars a year in cash flow.
But it will be a slog: The fourth quarter is generally a bumper period for companies that rely on digital advertising, so the next couple of quarters could feel like a let down for Snap and Twitter. And if they disappoint, their stocks — far more highly valued than Facebook — could plunge.
The tech flyaround
• Eleven British lawmakers testily questioned executives from Google, Facebook and Twitter about fake news during recent elections. (WaPo)
• India’s competition regulator fined Google $21 million for abusing its market position. (BBC)
• Facebook is testing a downvote button. (TechCrunch)
• Didi and SoftBank are teaming up for ride-hailing services in Japan, giving Uber another headache. (WSJ)
Your Bitcoin update
It’s down to about $8,251 this morning, according to CoinMarketCap. Meanwhile, investors are more willing to bet against the virtual currency.
• Elite U.S. universities are rushing to offer classes about Bitcoin and blockchain. (NYT)
• Traders keep their skills sharp by trading digital money. (FT)
• The European Central Bank will create its own settlement system. One board member boasted that it’s better than blockchain. (Bloomberg)
• Neal Wolin, a deputy Treasury secretary under the Obama administration, is the new C.E.O. of Brunswick Group. (DealBook)
• Dennis Berman, the WSJ’s financial editor, is joining Lazard’s activist defense practice. (Lazard)
• SandRidge Energy replaced its C.E.O. and C.F.O. under pressure from Carl Icahn. Bill Griffin will be interim C.E.O. and Mike Johnson interim C.F.O. (Bloomberg)
The Speed Read
• The Trump administration has published data showing a large increase in penalties against polluters, as well as $20 billion in commitments from companies to correct problems that have cause environmental damage. (NYT)
• The Addiction Policy Forum’s acceptance of money from the Pharmaceutical Research and Manufacturers of America has raised questions about whether it can really hold the drug industry to account over the opioid crisis. (NYT)
• Justice Ruth Bader Ginsburg has been on tour and enjoying it. (NYT)
• The cola wars may be turning into fizzy water wars. (NYT)
• David Wallerstein, Tencent’s chief exploration officer, has been helping the company make moonshot investments that could lead to big payoffs. (WSJ)
• Carson Block said that Muddy Waters was behind a 2015 report about a Chinese billionaire and an aluminum cache in Mexico, which helped spawn federal investigations (WSJ)
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