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Sep 15, 2016

DealBook | Today's News: Wells Fargo Subpoenaed, Another Merger in Agriculture, a Fragile Rebound - September 15, 2016

The New York Times

 

Thursday, September 15, 2016

 



By Amie Tsang
When DealBook reported that Wells Fargo had been fined for thousands of its employees opening accounts without customers’ consent, one of our readers wrote to ask what comes next legally for the lender.
It looks as if we just got the answer: The bank has received subpoenas from three different United States attorneys’ offices in the last week.
The subpoenas raise the prospect that the investigation (which is in its early stages) could lead to criminal charges, but prosecutors could also still handle the investigation as a civil fraud matter, which would require a lower burden of proof.
Wells Fargo executives have continued to deny regulators’ assertions that it was the bank’s incentive system and culture that encouraged the misdeeds.
You’ll hear more from the lender’s chief executive, John Stumpf, when he testifies before the Senate Banking Committee on Tuesday.
Democrats have said that they are keen to know whether top executives condoned the behavior.
Bayer-Monsanto Deal Faces Obstacles
Global agriculture is in a wrenching downturn. Farmers have produced too much corn, wheat and soybeans. That has forced them to slash their prices. And that, in turn, has cut into spending on seeds, pesticides and fertilizer.
Agribusiness giants have tried to protect themselves by consolidating to reduce costs. But this raises the prospect of higher costs for farmers — a concern for lawmakers and regulators in Washington.
Senator Charles E. Grassley, Republican of Iowa and chairman of the Judiciary Committee, has scheduled a hearing for next week to discuss the mergers, including Bayer and Monsanto’s $66 billion tie-up.
“It seems to be catching fire and happening so fast with so many,” Senator Grassley said. “When you have less competition, prices go up.”
If regulators do nix the deal, Bayer will be stuck with a painful $2 billion breakup fee.
A Fragile Rebound
If incomes are improving and poverty is down, why is Donald J. Trump’s message about economic decay still so resonant?
• Real incomes are still smaller than in the late 1990s.
• Large parts of the country, including rural America, are still lagging.
The upswing is real, but the gains have been strongest for people living in large metropolitan areas and for those with college degrees.
It’ll take more widespread growth to change how people actually feel. And in any case, good news about rising incomes is unlikely to change the complexion of the presidential race.
Coming Up
• The Commerce Department will publish data on retail sales.
• The Bank of England is expected to keep interest rates steady. Read our profile of Mark J. Carney, the Canadian who is in charge of the central bank as it confronts the challenges surrounding the British vote to leave the European Union.
Quotation of the Day
“If the safety engineer felt unsafe, he could at any time smack down a big red button in the center console — suspiciously similar to a seat ejector switch from a James Bond film — to disengage from self-driving mode.”
— Mike Isaac of The New York Times describes a trip in a self-driving Uber.
Contact amie.tsang@nytimes.com


Investment
The Hinkley Point C nuclear power station site near Bridgwater, England.
Hinkley Point Nuclear Plant Will Go Ahead, Britain Says
By STEPHEN CASTLE
The project, financed in part with French and Chinese investment, had been postponed in July, angering its international partners.
Nino Marakovic, chief of Sapphire Ventures, said that many venture firms scrambled to raise money this year as public markets dipped.
Sapphire Raises $1 Billion for Investment in Start-Ups
By KATIE BENNER
The fund eases some fears about a downturn in the venture capital industry.
CVC Stumbles with Buyouts in China
By THE WALL STREET JOURNAL
China’s rapid economic growth has made it an appealing destination for global buyout firms. But private equity executives said target companies often need more than the usual level of scrutiny, because they tend to be closely held firms with limited disclosure rather than publicly traded companies with years of audited accounts.
 
Legal and Regulatory
Pimco Accuses Bill Gross of Leaking Confidential Information
By BLOOMBERG
Pimco escalated its legal battle with its estranged co-founder, Mr. Gross, by saying he leaked confidential pay information to the news media and may have destroyed documents in violation of court rules.
Charles Tiefer and Elizabeth Foley testifying before the House Science, Space and Technology Committee on Wednesday.
Are Subpoenas on Exxon Mobil Inquiries Valid? Experts Say Yes, and No
By JOHN SCHWARTZ
A House panel heard conflicting testimony over whether exceptional subpoenas arising from investigations of Exxon Mobil by state attorneys general can be enforced.
On the Environment
A boat passing through the Ilulissat Icefjord, a Unesco heritage site, which displays the intersection of the ice sheet, calving glaciers and rising sea levels.
Americans Appear Willing to Pay for a Carbon Tax Policy
By MICHAEL GREENSTONE
A poll suggests that people are willing, on average, to pay more than an effective climate policy is projected to cost.
Workers Pay More for Health Care as Companies Shift Burden, Survey Finds
By REED ABELSON
Although premiums haven’t risen significantly, workers’ deductibles and shares of those premiums are going up, the nonprofit Kaiser Family Foundation said.
 
Auto Industry
General Motors produces the Bolt EV at its existing production system at the Orion Assembly plant outside of Detroit.
Laura McDermott for The New York Times
State of the Art
By FARHAD MANJOO
The Bolt EV by General Motors is a lower-priced electric car than the Tesla, and has similar features.

  A still from a video broadcast by the Chinese government news channel CCTV that depicts a fatal crash that may have occurred while Tesla’s automated driver-assist system was in use.
 
By NEAL E. BOUDETTE
The company says it has not confirmed whether the automated driver assist feature was engaged during the crash, which occurred in January.

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Business
Book Entry
Review: ‘Feminist Fight Club’ Takes On Workplace Sexism
By JONATHAN A. KNEE
Grounded in academic research, Jessica Bennett’s “Feminist Fight Club” is “Lean In” conceived as an illustrated guide for millennials in the office.
Bill Shine
Fox Co-Presidents Sign Multiyear Contracts
By JOHN KOBLIN
After a sexual harassment scandal and the departure of Roger Ailes at Fox News, the elevations of Bill Shine and Jack Abernethy are meant to promote calm.
Mock-ups of the new Twitter live-streaming app for Apple TV.
New Twitter App Streams N.F.L. Games and Other Sports
By KATIE BENNER
The app, for Apple TV, Amazon Fire TV and Xbox One, offers a wide variety of live content, including Thursday night N.F.L. games.
Disney Cuts 250 Jobs in Consumer Products and Digital Unit
By BROOKS BARNES
The layoffs, while small given Disney’s sheer size, have followed a pattern in recent months as the company tries to move fast to control costs.
Carly Nakayama checks on the 3-D printing process in the San Diego office of the tech cobbler company Feetz.
Your Next Pair of Shoes Could Come From a 3-D Printer
By CONSTANCE GUSTKE
Fashion start-ups are using technology like smartphones and 3-D printing to make custom clothing more affordable, and Silicon Valley is taking notice.
 
NY
A man sang and danced to a song by the heavy metal band Slipknot playing on a LinkNYC Wi-Fi kiosk in Manhattan on Wednesday.
Bryan Thomas for The New York Times
By PATRICK MCGEEHAN
The operator is shutting off the internet browsers because they have drawn people who linger for hours, sometimes drinking, using drugs or watching pornography.
Michael M. Samuelian was appointed as president of the Trust for Governors Island on Wednesday.
Hiroko Masuike/The New York Times
By LISA W. FODERARO
Michael M. Samuelian, a vice president at Related Companies, will become president of the Trust for Governors Island, which directs development there.