|
Good Morning. In today’s edition, a new round of U.S.-China trade talks is coming, growing recession worries underscore tensions between the White House and the Fed, and Disney tries to get the Fox studio on track. |
|
|
President Trump, returning to Washington after a week at his New Jersey club, warned Chinese President Xi Jinping against reacting violently to protests in Hong Kong, saying that could threaten a trade deal, hours after administration officials confirmed a new round of talks with Beijing. Over the weekend, officials also said they would give Chinese telecom giant Huawei more time to work with U.S. customers. However, Mr. Trump appeared to back away from reports that the administration would grant a 90-day extension to the license that has allowed Huawei to do some business within the U.S. despite the company’s blacklisting. Mr. Trump dismissed worries of a recession, pointing to the strong labor market and robust consumer spending. Despite the president’s optimism, concerns are rising that a prolonged trade war could inflict considerable damage to the global economy. Investors are snapping up safer assets including gold, dividend-paying stocks and the Japanese yen. A prolonged dollar rally is pressuring U.S. corporate earnings, hitting commodity prices and threatening to deepen a selloff in emerging markets. Stocks in Europe and Asia rose Monday on the prospect of progress in U.S.-China trade talks and expectations of global central-bank stimulus measures. From reporter Ira Iosebashvili: The dollar’s rally has been fueled by the relative strength of the U.S. economy compared with the rest of the world—a factor that many believe will remain in place for the time being, as countries in Europe and Asia struggle to boost growth. That means the dollar will likely stay near the top of the currency heap for some time, adding to the pressure markets are already feeling from a trade war and economic slowdown. |
|
|
|
|
|
The Fed’s leader is wedged between a slowing economy and an angry president. Jerome Powell is entering the most perilous stage yet of his tenure as Federal Reserve chairman, fighting to keep the U.S. from sliding into a recession as President Trump blames him for skittish markets and an economic slowdown. Mr. Trump’s criticism has led people inside the Fed to feel as if they are fighting to both buoy the U.S. economy and preserve the central bank’s independence from political interference. After cutting short-term interest rates in July, Mr. Powell is navigating the Fed toward more rate reductions, though conditions could change. The debate among his central-bank colleagues is over how much to move rates and when, as well as how to best frame the decision, which will be scrutinized by markets and the White House. Mr. Powell is scheduled to speak Friday at the Fed’s annual conference in Jackson Hole, Wyo. |
|
|
| Who should shoulder the blame for a slowing U.S. economy: President Trump or Fed chief Jerome Powell? Join the conversation. |
|
|
|
|
Hundreds of thousands of pro-democracy demonstrators braved torrential rain to hold the largest rally in Hong Kong in weeks. | | PHOTO: ANTHONY KWAN/GETTY IMAGES |
|
Sunday’s peaceful protest was a show of mass support that reset the movement that opposes Beijing’s tightening grip on the city—and added pressure on officials to resolve Hong Kong’s worst political crisis in decades. The demonstration was in contrast to past weeks’ clashes between protesters and police. Demonstrators rallied in Victoria Park as crowds overflowed into the streets. Many marched 2 miles to Hong Kong’s financial district, clogging major roads, in defiance of a police ban on any procession outside the park. This weekend was the first in nearly a month without police firing tear gas. Worried Hong Kong residents are moving money out of the city. Hong Kong’s richest man, Li Ka-shing, warned both protesters and Beijing against violence in front-page newspaper ads. |
|
|
|
Disney’s latest endeavor: getting the Fox studio on track. When Disney CEO Robert Iger told analysts this month that Fox films had dragged down a record year for his studio, some Fox executives pointed the finger back at Disney. Mr. Iger put most of the blame on a protracted acquisition process. Fox executives, however, say it had more to do with uncertainty and indecisiveness stemming from Disney’s lack of communication during that time. The challenge of integrating Fox was compounded by the poor performance of its movie lineup. Layoffs and attrition have left Fox’s marketing and publicity departments depleted, resulting in advertising campaigns that some employees describe as creatively uninspired, paint-by-numbers operations. |
|
|
|
|
The billions of illegal robocalls inundating Americans are being facilitated largely by small telecom carriers that transmit calls over the internet, but authorities are at odds over what can be done to stop them. These carriers typically charge fractions of a cent for each call, making their money on huge volume. Their outsize role in the robocall scourge has become apparent as large telecom companies get better at tracing robocalls to their source, spurring calls for regulators to hold them accountable. U.S. regulators have conflicting interpretations of their ability to take the companies to court, however. Also, carriers aren’t explicitly required to try to differentiate between legal and illegal robocalls, further clouding enforcement. |
|
|
|
|
What We’re Following Warning System: Two Russian monitoring stations designed to detect nuclear radiation went silent soon after the explosion at a missile-test site this month, fueling concerns that Moscow is trying to restrict evidence. Out to Sea: The Iranian tanker released Sunday by Gibraltar was sailing to Greece, according to ship-tracking data, as Tehran warned the U.S. against targeting the vessel after a last-minute attempt to seize it in the British overseas territory. Wedding-Hall Attack: The death toll from the suicide blast in Kabul, Afghanistan’s capital, rose to at least 63 people. Turmoil at Novartis: CEO Vas Narasimhan is facing a storm of criticism over keeping a data-manipulation issue under wraps while the FDA completed a drug review. |
|
|
Arctic Flurry: President Trump confirmed interest in purchasing Greenland, the world’s largest island, but said it wasn’t a top priority. The development has drawn mixed reaction in Greenland, where locals are sensitive after 300 years of Danish rule and resist the idea of being bought. Cash Injection: Japanese tech conglomerate SoftBank plans to lend up to $20 billion to its employees to buy stakes in its second giant venture-capital fund. Fund Stumble: Daniel Ivascyn’s Pimco Income Fund—the world’s largest actively managed bond fund—has underperformed 93% of its peers in 2019, stung by market tumult. |
|
|
|
Nick Saban wins national titles. He loses assistant coaches. | | Alabama head football coach Nick Saban. PHOTO: VASHA HUNT/ASSOCIATED PRESS |
|
For the second year in a row, seven of the Alabama coach’s deputies from the previous season’s staff, including both the offensive and defensive coordinators, left for coaching jobs elsewhere. The result is that not one assistant from his 2017 staff—which coached the team to a national championship—remains in an on-the-field role. The unprecedented exodus raises a question: Is there something about Nick Saban’s management style that prompts his lieutenants to leave, no matter how many national titles the Crimson Tide win? |
|
|
From reporter Laine Higgins: It isn’t uncommon for coordinators and position coaches at successful college football programs to get poached by other teams in the NCAA or NFL. It is rare, however, for entire staffs to turn over in the span of two seasons—what has happened at Alabama since 2017. For the second straight year, Nick Saban had to pretty much rebuild his staff from scratch, and it’s incredibly impressive that he has been able to keep Alabama at the pinnacle of the sport amid such high turnover. But it does make you wonder if there is something about his leadership style that is contributing to the assistant churn in Tuscaloosa. He didn’t seem to think his high standards played a role, but former assistants said working for him can be a bit of a grind. |
|
|
|
|
| Do you think there is something about Nick Saban’s management style that prompts his lieutenants to leave? Join the conversation. |
|
|
|
|
Trending Stories at WSJ.com The instruments went haywire. The controls shook. Warning lights filled the cockpit. Boeing assumed pilots could find the right response in four seconds. It was a fatal miscalculation. This is the inside story of how Boeing built a plane that fell from the sky. (Read) Tumblr’s fall and the end of the eyeballs-are-everything era. (Read) |
|
|
|
Wall Street Has Abandoned Oil and Gas Stocks. You Shouldn’t. The beaten-down energy sector is starting to look oversold. That’s misguided. Here are some picks to play a rebound. (Barron’s) |
|
|
|
What Else We’re Reading About 4,000 people on one of Spain’s Canary Islands were evacuated yesterday because of wildfires ravaging the countryside. (Associated Press) “We lost something special”: The women’s hospital in Washington, D.C., that became a Trader Joe’s. (Washington Post) |
|
|
|
Today’s Question and Answer In response to our question about whether the U.S. should explore purchasing Greenland: Victoria Gallo, Connecticut Greenland is earning its place on the international stage for all the wrong reasons. What would Greenland ever get in return? Free golf? Would Greenland be turned into a golf course once the glaciers melt because of climate change? Seriously, this transaction would have to be approved by Denmark, the people of Greenland and the U.S. Yes, there is an abundance of resources that would make it an ideal acquisition, but I can’t see how Denmark would ever want to sell 50,000 citizens. Doug Harvey, South Carolina With what? That would be like buying a Mercedes when your credit cards are maxed out. J. D. Russell, Virginia Yes. Pursue the purchase of Greenland. Why not? Obviously, the U.S. isn’t invading and taking over Greenland, so what’s the big deal? Some of us who live in a good real-estate market get letters daily containing offers to buy our houses. I throw them away, but it’s still a nice feeling. I wish the media would stop acting as if President Trump just announced an invasion of Greenland. Christopher Ross, Massachusetts While it seems unlikely that Denmark would support such a transaction, it would be a historic and strategic triumph to combine such a territory with the U.S. The possibilities are truly fascinating. Karin Bonding, Virginia Yes, it is true that Greenland holds a plethora of minerals that can be exploited, but I cannot imagine the Danes or the native Greenlanders would agree to any sale. Some years ago, China was looking at Greenland because of the presence of rare earths. That, thank goodness, came to naught. This latest cockamamie idea should suffer the same fate. Walter H. Rose, Alaska If by “explore,” you mean asking simple questions like these: Is it for sale? How much do you want for it? Is there local support? Is there support in this country? Then the answer is yes, we should explore the purchase. If it is for sale, the price is decent and there is support, then we should probably explore it in more detail. That’s common sense, right? Question for tomorrow’s 10-Point: Who should shoulder the blame for a slowing U.S. economy: President Trump or the Fed’s Jerome Powell? Or neither? Email us your comments, which we may edit before publication, to 10point@wsj.com, and make sure to include your first and last name and location. |
|
|
| The 10-Point was the name given to the news column that runs on the front page of The Wall Street Journal. Today’s newsletter was curated and edited by Eleanor Miller in New York and Keith Collins in Hong Kong in collaboration with Editor in Chief Matt Murray. Let us know what you think by replying to this email. The 10-Point is a WSJ member benefit. If someone forwarded you this email, we invite you to join us and enjoy the full breadth of scoops, analysis and great storytelling from our journalists around the globe. |
|