Newsletter: California Inc.: Mnuchin, Ross among big names at Milken event in Beverly Hills
Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section.
I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.
Trading resumes Monday after Friday’s news that the nation’s economic growth slowed over the last three months despite large tax cuts kicking in. Total economic output expanded at a solid 2.3% annual pace in the first quarter. The figure was higher than analysts had expected but below the 2.9% pace in the fourth quarter of last year.
LOOKING AHEAD
Milken confab: The Milken Institute Global Conference — an annual confab for investors, researchers and policymakers — kicks off Monday in Beverly Hills. Treasury Secretary Steven T. Mnuchin, Commerce Secretary Wilbur Ross and Sen. Chuck Schumer (D-N.Y.) are among the big names appearing at the event, put on by the think tank founded by former junk bond king Michael Milken.
Oh, Snappy day: Snap, maker of video messaging app Snapchat, will release its first-quarter earnings report Tuesday. Analysts are looking to see whether the Venice company can build on its surprisingly strong results in the previous quarter. Snap is struggling to grow in the face of stiff competition from Facebook’s Instagram.
Red, red ink: Tesla will release its first-quarter results Wednesday — and is expected to post record losses. In an earnings call, analysts likely will ask Chief Executive Elon Musk about continuing production and quality problems with the Tesla Model 3. Musk also might talk up plans for an upcoming Model Y compact SUV.
Rate hike unlikely: Federal Reserve policymakers on Wednesday are expected to hold their key interest rate steady after a two-day meeting. They raised the rate 0.25 percentage point in March.
Jobs report: The Labor Department releases the latest jobs report on Friday, with economists expecting payrolls grew by 200,000 in April. That would be nearly double the disappointing 103,000 jobs added in March.
THE AGENDA
Monday’s Business section looks at how Amazon has quietly made rights for and acceptance of gay and transgender people part of its criteria in choosing a second headquarters. Amazon’s push on gay and transgender rights may increase pressure on state and local policymakers who have either declined to institute equal-rights rules or passed laws some view as discriminatory.
STORY LINES
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
Southwest setback: The first fatal accident in the history of Southwest Airlines has pushed bookings down as the nation’s most popular domestic carrier tries to repair damage to its reputation and expedite inspections of virtually its entire fleet of planes. The Dallas-based airline said it expects revenue per mile, which tracks average prices, to drop between 1% and 3% in the April-through-June quarter.
A big noise: After racking up hundreds of millions of dollars in losses, Paramount Pictures is flipping its script: Viacom’s Melrose Avenue film studio eked out a profit during its fiscal second quarter. “This is an important step,” Viacom Chief Executive Bob Bakish told Wall Street analysts. “Paramount’s turnaround is really taking hold.” The horror film “A Quiet Place” has scared up $131 million domestically since its April 6 release.
#MeToo: Longtime NBC News journalist Tom Brokaw is denying allegations by a former network correspondent who said he sexually harassed her in the mid-1990s. Linda Vester, 54, told Variety and the Washington Post that Brokaw made unwanted sexual advances toward her when they worked together at NBC in the 1990s.
Popping the lock: At a time of heightened concern about user privacy, Amazon is seeking access to one of users’ most private places: the trunks of their cars. The company launched what it calls In-Car Delivery, which allows delivery drivers to open the trunks of certain late-model cars and drop off packages inside. Last year, Amazon debuted a web-connected door lock and camera that lets delivery drivers deposit packages within customers’ homes.
Take two: Snap announced it’s doubling down on its sunglasses experiment, unveiling a second version of its so-called Spectacles that are lighter, more powerful and also water-resistant. The move comes as Snap has begun taking a far more conventional approach to its software strategy by revamping Snapchat to attract new users and introducing cheaper ads to drum up business.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Sticker shock: The Wall Street Journal examines the tricky business of covering breakthrough genetics-based medicines that can cost as much as a million dollars. “So far, few patients have received the new drugs, as commercial health plans and Medicare wrestle with how to cover the treatment.”
Hot times: The New York Times notes that even though the economy is improving, many Americans feel left behind. For Federal Reserve officials, the danger is an overheating economy that may be “destabilizing financial markets and setting off a rapid escalation in wages and prices that could force the central bank to slam the brakes on growth.”
Forced arbitration: California lawmakers are mounting a new push to prevent businesses from forcing workers into closed-door arbitration over sexual harassment, discrimination and other complaints, says the Orange County Register. “In a workplace with a culture of sexual harassment, these arbitration agreements are particularly toxic, enabling the abusive behavior to continue unchecked,” says the bill’s author, Assemblywoman Lorena Gonzalez Fletcher (D-San Diego).
Scaling back: Bloomberg looks at the latest retrenchment by U.S. automakers, whittling down the number of vehicles offered. “When they were trying to be all things to all people, they made a plethora of cars and maybe a third of them made money,” one analyst says. “They felt like it was their responsibility. Now they want to show returns and profit growth.”
Less is more: Fast Company visits Pret-a-Cover, a fashion event organized by the Islamic Fashion and Design Council. The style showcase “was specifically geared toward drawing attention to emerging designers from around the world who are putting their own spin on modest dressing.”
SPARE CHANGE
I love stories about rescue animals, so it was hard to resist this nifty film from Oscilloscope Films, as tracked down by the Atlantic. It’s called “Pickle” and “surveys the quirky animals [the filmmaker’s] father and step-mother accrued, such as obese chickens, a paraplegic possum, a cross-eyed cat and a body-less fish.” These two people may be the nicest folks you meet all day.
For the latest money news, go to www.latimes.com/business. Until next time, I’ll see you in the Business section.
