Americas

Joe Biden displays power and risks of incumbency

21 Jul 2024

The US president will not run for re-election, a momentous decision that may have come too late to mitigate damage to his party. Unlike corporate leaders, a sitting commander-in-chief is almost impossible to dislodge. Biden’s replacement will face Donald Trump without that grip.

Cyber meltdown points to downsides of efficiency

19 Jul 2024

A software update by $83 bln CrowdStrike grounded flights and disrupted financial markets. That’s possible because businesses work with a small number of providers, seeking lower costs. It supports rich tech valuations, but also heightens the risks of a catastrophic failure.

Much of Blackstone’s success is out of its hands

19 Jul 2024

The $1 trln asset manager, which buys real estate and other assets with loads of debt, has always been vulnerable to rising rates. Now it is under pressure to deploy its mountain of cash. The die has been cast - the rest is up to the Fed.

Meta stake may blur vision for Ray-Ban maker

18 Jul 2024

The $1.2 trln tech giant may buy 5% of eyewear group EssilorLuxottica. It’s a show of confidence in the companies’ smart glasses partnership. But the investment could complicate the Paris-listed firm’s governance and limit its options for working with rivals like Apple.

Trump 2.0 might be the same, but much more

18 Jul 2024

After an earth-shaking few weeks in US politics, the Republican presidential candidate’s odds of returning to the White House look higher. In this Viewsroom podcast, Breakingviews columnists discuss what a second term might look like, and why Trump might be empowered this time.

Netflix and HBO would be a blockbuster duo

18 Jul 2024

A possible breakup of Warner Bros Discovery, owner of 'Game of Thrones' network HBO, could give the $280 bln Netflix a chance to swoop. Buying WBD’s streaming and studios, maybe worth $60 bln, would put Reed Hastings’ content-hungry firm in an even bigger position of strength.

EQT hit carries warning for buyout-firm investors

18 Jul 2024

The $40 bln private equity group’s shares sank after it missed analysts’ forecasts. The lesson is that predicting profits from selling companies is tough. It also suggests that a recent valuation run-up for listed managers is out of whack with tricky dealmaking conditions.

Americans’ travel bug is too much of a good thing

18 Jul 2024

More US citizens are going to Europe than vice versa, creating a $27 bln tourism-related trade gap, the biggest in over two decades. Sometimes there’s a simple reason: it can be cheaper to see Taylor Swift abroad. But a persistent travel deficit could have ominous symbolism.

Novo Nordisk obesity feast no longer a free lunch

18 Jul 2024

The $603 bln drug group’s shares have more than trebled since 2021 on the back of booming sales of weight-loss treatment Wegovy. To justify that, it will need to keep coming up with new, even better products, and fend off rivals like Pfizer. Neither looks certain.

Silicon Valley daredevils ride or die with Trump

17 Jul 2024

Marc Andreessen, Elon Musk and other tech entrepreneurs are lining up behind the former US president. Maybe there’s ideological alignment, but naked self-interest and contrarian biases probably play a part, too. The downside in politics, however, is far bigger than in business.

Boeing CEO hunt involves checking many boxes

17 Jul 2024

Repairing the battered jet-maker is a once-in-a-career challenge. Dave Calhoun’s successor will have to bolster cash flow, reduce factory snafus and design and fund a better plane. They’ll need precision, tech smarts and, crucially, a willingness to gamble their reputation.

Match is a relationship better enjoyed in private

17 Jul 2024

For public investors, the owner of dating app Tinder’s profile has a red flag: slow growth. With shares down 80% since 2021, Starboard is the latest rabble-rouser pushing fixes. Strong cash flow and a cheaper valuation make the $9 bln company a better pairing for a buyout shop.

European boards have too little skin in the game

17 Jul 2024

Non-executive directors at big US companies get 60% of their pay in equity. That’s rare in Britain, France and Germany, where many board members own a slither of stock. Cash fees warp incentives, discourage engagement, and risk making Europe’s capital markets less competitive.

Banks prep for this-time-it’s-different deal boom

16 Jul 2024

Morgan Stanley’s 51% pop in investment banking revenue rounds out a strong quarter for Wall Street rainmakers. Peers like Goldman Sachs and JPMorgan are also eyeing a pick-up in M&A and underwriting. But the clients look different now, and so do the banks – not all in a good way.

Stripe would be an ugly pattern for Silicon Valley

16 Jul 2024

The fintech firm led by the Collison brothers has outlived most venture capital funds without going public. Its $70 bln valuation looks generous for a sluggish IPO market anyway. Sequoia cashing out older backers with newer funds buys time, but also distorts the investment model.

Ozempic may gift US a $3 trln benefit

16 Jul 2024

Tech advances are the unpredictable joker of healthcare spending, sometimes adding to outlays. Recent estimates to the United States' medical bill suggest costs will rise, even with the new obesity drug. But previous technological advances in medicine have been underestimated.

Buyout barons’ IPO castoffs trade may be repeated

16 Jul 2024

Clayton Dubilier & Rice’s $2.6 bln offer for software firm Exclusive Networks would see it scoop up a stock that has drifted since a 2021 listing. Majority-owner Permira would get a handy way to cut exposure. A long list of struggling initial offerings mean more deals may follow.

European board pay requires a US-style overhaul

16 Jul 2024

Non-executive directors at UK and EU-based firms own little equity in the companies they oversee. In this Exchange podcast, Liad Meidar of the hedge fund Gatemore argues that this is a problem, while Peter Boreham of the pay consultancy Mercer explains why it’s hard to change.

Inflation teaches five lessons for the next crisis

16 Jul 2024

After taming a 9% rise in prices without breaking economies, US Fed Chair Jay Powell and other central bankers are poised to pat themselves on the back. There’s also an opportunity to improve the playbook. Among the useful takeaways: embrace taciturnity, flexibility and humility.

Trump VP pick plays on a message of decline

15 Jul 2024

The Republican candidate's new running mate JD Vance solidifies an agenda of trade and immigration restrictions pitched to struggling workers. Vance’s story of upward mobility appeals to the blueprint, and a grim truth: for working-age men, it’s harder to climb the ladder.