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DealBook Briefing: What Will Trump Do in Davos, if He Comes?

DealBook Briefing: What Will Trump Do in Davos, if He Comes?


• How to respond to cyberwarfare by the likes of North Korea (NYT)

• How to improve women’s standing in the world, with several top women leaders in attendance (NYT)

• Big tech companies’ image woes (FT)

• France’s efforts to woo business leaders, including a pre-Davos summit at Versailles that will be attended by Jamie Dimon and Sheryl Sandberg (Reuters)

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Today’s DealBook Briefing was written by Andrew Ross Sorkin in Zurich, and Michael J. de la Merced and Amie Tsang in London.

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Zach Gibson for The New York Times

Why markets should worry about a long shutdown

From a recent note by analysts at Pantheon Macroeconomics:

We would be astonished if Congress could not cobble together a majority of the sane in order to prevent a default. But astonishment has been quite common in response to events over the past couple of years, so investors would be well-advised to rule out nothing, however outlandish.

Here’s more on the damage from a prolonged shutdown from the NYT.

Where things stand

A group of moderate lawmakers is still working on a compromise. The Senate majority leader, Mitch McConnell, has scheduled a vote on a temporary funding bill for noon E.T. today, though it’s unclear whether it will pass.

Elsewhere in Washington

• Wilbur Ross has fallen from Mr. Trump’s graces because of a perceived inability to strike good trade deals and a propensity to sleep in meetings. (Axios)

• How Jared Kushner became a focal point for China’s diplomatic outreach to the U.S. — and stirred up the worries of U.S. officials. (New Yorker)

• Deutsche Bank has flagged bank accounts tied to the Kushner family for “suspicious transactions” and referred the matter to German authorities — and may send its information to Robert Mueller as well, according to Manager Magazin of Germany. (Manager, Mother Jones)

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Dado Ruvic/Reuters

Facebook isn’t certain it’s good for democracy

Here’s what Samidh Chakrabarti, a product manager at the tech giant, wrote in a post on the company’s Hard Questions blog:

Facebook was originally designed to connect friends and family — and it has excelled at that. But as unprecedented numbers of people channel their political energy through this medium, it’s being used in unforeseen ways with societal repercussions that were never anticipated.

Mr. Chakrabarti added that while the company was slow to address Russian interference in the 2016 presidential election, it’s working to prevent it happening again.

More news from Facebook

• It spooked some publishers again by saying it would let users rank the trustworthiness of news outlets. (NYT)

• And its recent News Feed changes may reflect its video ambitions, some ad agencies said. (NYT)

The tech flyaround

• SoFi is courting Anthony Noto, Twitter’s chief operating officer, who is its most senior full-time employee. (Recode, WSJ)

• Inside Amazon Go, the e-commerce giant’s cashierless Seattle store, where our colleague tried unsuccessfully to shoplift in the name of journalism. (NYT)

• Marc Benioff of Salesforce said of noxious cultures at start-ups, “When I see that product is the number-one thing, the only thing that matters, that’s a real red flag.” (FT)

• Tim Cook, visiting a school in Britain, told pupils he wouldn’t let his nephew use social media. (Guardian)

The deal flyaround

• The luxury goods maker Richemont offered as much as $3.4 billion to buy the rest of Yoox Net-a-Porter. (NYT)

• Archer Daniels Midland has made a takeover approach to the agriculture trader Bunge, potentially creating a showdown with Glencore, according to unidentified sources. (WSJ)

• Elliott Management is pushing for a higher takeover price for Starz than the $4.4 billion Lionsgate agreed last year. (NYP)

• The French drug maker Sanofi will buy Bioverativ, which makes a hemophilia drug, for more than $11.5 billion. (WSJ)

• Carl Icahn has teamed up with Xerox’s third-biggest investor, Darwin Deason, to push for a sale, according to unidentified sources. (WSJ)

• Ferrero’s $2.8 billion deal to buy Nestlé’s U.S. confectionary brands is a clear sign of a generational and cultural change at the Italian company. (FT)

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Lucas Jackson/Reuters

Someone believes in Jes Staley

It’s Tiger Global. The American hedge fund has quietly acquired a 2.5 percent stake in Barclays, worth more than $1 billion, according to the FT.

More from the FT’s Martin Arnold and Miles Johnson:

Tiger Global appears to back Mr. Staley’s view that the bank’s 40 percent discount to book value is unjustified after it recently completed its multiyear restructuring and sold off most of its African operation to address longstanding concerns about its capital levels.

UBS’s turnaround hits a bump

The Swiss bank reported 488 million Swiss francs ($508 million) in fourth-quarter pretax income, missing analyst expectations.

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Thousands of protestors went to the National Mall in Washington on the one-year anniversary of the Women’s March.

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Leah Millis/Reuters

Has #MeToo made inroads on Wall Street?

Omeed Malik, one of Bank of America’s top liaisons to the hedge fund world and a confidant of Jon Corzine, has left the firm after an internal investigation into a young female analyst’s accusation of inappropriate sexual conduct.

More from Jessica Silver-Greenberg and Matt Goldstein of the NYT:

Officials from human resources interviewed as many as a dozen people who have worked with Mr. Malik. He left roughly two weeks before annual bonuses were to be handed out.

Why haven’t more Wall Street cases come to light? Arbitration, primarily. But a discrimination lawyer told the WSJ, “We’re getting quadruple the calls ever since Harvey Weinstein.”

The misconduct flyaround

• How to practice so-called gender-lens investing and support women in the workplace. (CNBC)

• The Sundance Film Festival, Harvey Weinstein’s old stomping ground, is now a showcase for women. (NYT)

• Representative Patrick Meehan, a Pennsylvania Republican who has taken a leading role in fighting sexual harassment in Congress, used taxpayer money to settle a misconduct complaint of his own. (NYT)

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An employee at a Bitmain facility in Inner Mongolia, one of the biggest Bitcoin farms in the world.

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Giulia Marchi for The New York Times

Can Bitcoin mining go green?

Right now, the computation to “produce” a new Bitcoin uses as much energy as an American household consumes in two years, according to analysts at Morgan Stanley and the economist Alex de Vries. Some in the virtual currency community are looking for ways to reduce that figure.

Here’s what Vitalik Buterin, the creator of Ethereum, told Nathaniel Popper of the NYT:

“I would personally feel very unhappy if my main contribution to the world was adding Cyprus’s worth of electricity consumption to global warming.”

Some, however, say an independent, decentralized monetary system is worth the cost.

The virtual currency flyaround

• Louis Dreyfus has teamed up with ING and ABN Amro of the Netherlands and Société Générale of France to create a blockchain platform for agricultural trading. (Bloomberg)

• Bitcoin could lose 90 percent of its current value, predicts Peter Boockvar, a veteran Wall Street investor. (CNBC)

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Boone Pickens on his Mesa Vista Ranch

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Tom Fox/The Dallas Morning News, via Associated Press

Quote of the day

“I truly believe I was put on this Earth to make money, but also to be generous with it.”

— T. Boone Pickens to the NYT, as the investing tycoon steps back from business and focuses on philanthropy.

The Speed Read

• The Saudi authorities expect settlements in a corruption investigation that has implicated dozens of princes to bring in more than $100 billion, according to a senior government official. (Bloomberg)

• Iran’s banks need urgent restructuring and recapitalization, the I.M.F. has warned — up to 40 percent of their loans may be delinquent. (NYT)

• Many in Peterborough, Ontario, blame Nafta for industrial losses in the city, even as President Trump casts the deal as hurting the U.S. and benefiting Canada and Mexico. (NYT)

• Carlyle is preparing to raise more than $2.5 billion to buy oil and gas assets outside North America. (FT)

• Cedar Holdings Group, a Chinese conglomerate, has expressed an interest in buying Noble Group, the struggling commodities trader, according to to people familiar with the matter. (Bloomberg)

• Toshiba is considering an initial public offering of its memory chip business, in case its $18 billion sale of the unit fails to gain antitrust approval by the end of March, according to people familiar with the plans. (FT)

• The bonuses that came after tax reform aren’t just about politics: Amid low unemployment rate low and with unfilled job openings high, companies are afraid of losing workers. (WSJ)

• Money managers like BlackRock, Vanguard and State Street mean different things by “engagement,” making it difficult to assess how they’re wielding their clout. (WSJ)

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