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David Droga reveals why he's giving up his cherished independence and selling Droga5 to Accenture Interactive (ACN)

Fri, 04/05/2019 - 5:30pm  |  Clusterstock

If you've followed David Droga, his decision to sell his influential creative ad agency to Accenture Interactive likely came as a big surprise.

Droga5 was one of the largest and most succesful independent agencies, and Droga himself has said he'd turned down multiple acquisition offers. In fact, in an interview just two years ago, Droga extolled the virtues of Droga5's independence, saying he had no interest in selling or being a part of a larger corporation again.

So what changed his mind? In an interview with Business Insider, Dorga said he thought selling was the best way to increase his firm's influence and broaden the scope of its work.

"I want to build this incredibly influential agency," Droga said. "I'm selfishly doing this because I think Accenture Interactive is going to help us, and they're the brightest partners we can have out there."

The deal with Accenture Interactive, announced on Wednesday, will fill a hole in Accenture Interactive, which has become a big advertising concern but didn't have a big, US-focused creative department.

Accenture Interactive also thinks Droga5's team will do more than just that. The company is trying to help clients rethink and revamp the way consumers discover and interact with their products and services, and its CEO Brian Whipple believes Droga5 will help Accenture Interactive create such experiences for clients.

Read more: Accenture Interactive's CEO says its acquisition of Droga5 will give the consulting firm more than just a creative agency

Droga has grand ambitions

Droga said his firm enjoyed being independent. But with Accenture Interactive, he and his team will be able to work with a wider group of clients and do more for them than they would have if they remained independent, he said.

"Our ambitions are grander. Our ambitions are bigger," he said. "This is about what we can do together, period."

Droga also rejected the notion that he's selling out, reiterating that he's had plenty of other opportunites to sell the firm.

"If I wanted to sell out and sort of throw a Molotov cocktail over my shoulder and get on a yacht, I would have done that years ago," he said. "Anyone who knows me and knows us knows that's not what we're about."

Got a tip? Contact this reporter via email at twolverton@businessinsider.com, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

SEE ALSO: Twitter has 126 million daily users. That's 48% fewer than Snapchat, but it says the numbers aren't comparable.

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Betting against Lyft is 'the amateur short,' Citron Research says (LYFT)

Fri, 04/05/2019 - 3:49pm  |  Clusterstock

  • Citron Research is long Lyft and says anyone betting against the company is an "amateur."
  • Citron invested in Lyft ahead of its initial public offering and has continued to buy shares in the open market.
  • Watch Lyft trade live.

Citron Research, headed by the short-seller Andrew Left, has strongly criticized investors betting against the ride-hailing company Lyft. The research firm has gone so far as to label shorting Lyft as "the amateur short."

Lyft short bets have neared almost $1 billion in the company's first week as a publicly traded company, with plenty of "dry powder" for further bets, said Ihor Dusaniwsky, the managing director of predictive analytics at S3 Partners, a financial-analytics firm.

The company's IPO was notably volatile, with shares falling 20% in its first few days of trading. Lyft opened for trading at $87.24 and subsequently fell below its IPO price of $72 before partially recovering on Friday.

Citron was a pre-IPO investor, holding its shares for at least two years. In addition, the firm has continued to buy the stock on the open market following the IPO.

Citron said it has 25 years' experience shorting stocks, which have included Wayfair and Tesla, and listed several reasons Lyft is not a suitable short candidate. Citron cites the following reasons not to be short Lyft.

1. Compounder

Active riders have grown more than 500% over the past three years, with use among millennials exponentially higher than older cohorts. This indicates the number of active riders will grow significantly as this cohort ages. Over 70 million people will turn 18 over the next 17 years, many of whom will opt for ride hailing and sharing over vehicle ownership, Citron says.

2. Upward sloping cohort curves

Similar to Amazon, ride-hailing users repeatedly use the company's services, lowering its customer-acquisition costs, Citron said. Ride hailing and sharing are time-saving benefits well in excess of alternatives, implying potential pricing power.

3. The trend is real

Teenagers are no longer tied to their cars, as 16-year-olds with driver’s licenses declined from 46% in 1983 to 26% in 2016. This trend is likely to continue, signaling increased demand for ride hailing and sharing, according to Citron.

"This is not a trendy video game or a GoPro camera … this is a way of life that is saving people time and ensuring safety. Ridesharing is not a fad … it is a megatrend," Citron said.

4. Massive valuation discount to Uber despite taking share

According to preliminary IPO valuations, Uber may go public at a $120 billion valuation. This is a significant premium to Lyft, about six times its public-market valuation despite it taking share in the US market. The two companies control 99% of the market, however. Lyft's share has risen from 22% in 2016 to 39% in 2018.

5. Blue Sky Narratives

Lyft has made significant moves to position itself in the autonomous-vehicle market. In 2018, Lyft reached 5,000 paid self-driving rides in Las Vegas, Citron said. In addition, if ride hailing and sharing adopt a subscription model, Lyft and Uber will have Amazon-like prospects and effectively lock in customers and prevent the competition from scaling.

Some other analysts have also been positive on Lyft, with Wedbush's Dan Ives referring to its large addressable market as a "golden opportunity."

Finally, Citron says that while Lyft lost over $900 million last year, so too did tech giants Amazon, Netflix, and Square in their early days — all of which have produced spectacular returns.

Despite its strong conviction on Lyft, Citron has been known to change its mind. Left famously switched his position on Tesla from short to long just before the electric-car maker announced record results.

Lyft was up 3.5% from last Friday's IPO price.

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Hedge-fund billionaire Ray Dalio says the state of capitalism poses 'an existential threat for the US'

Fri, 04/05/2019 - 3:35pm  |  Clusterstock

As the 2020 presidential race heats up in the United States, Democratic candidates like Sen. Bernie Sanders and Sen. Elizabeth Warren are calling for an overhaul of America's economic and financial policies for the sake of the country's future. Also joining the conversation: hedge-fund billionaire Ray Dalio.

Dalio is the founder and co-CIO of Bridgewater Associates, the Connecticut firm with $160 billion in assets under management. In a LinkedIn post published Thursday, he called for a reformation of capitalism.

He wrote that the "income/wealth/opportunity gap and its manifestations pose existential threats to the US because these conditions weaken the US economically, threaten to bring about painful and counterproductive domestic conflict, and undermine the United States' strength relative to that of its global competitors."

Dalio used data to show there are essentially two Americas, where the top 40% is doing significantly better than the lower 60% and the nature of accrued wealth and educational opportunities for the majority of Americans is keeping them trapped in poverty.

The day after publishing his piece, Dalio announced he and his wife, Barbara, were making a $100 million donation to the most underfunded Connecticut public schools, the largest in the state's history. He said it's a way to help level the playing field in a state that is one of the wealthiest in the country yet still has pockets of extreme poverty and 22% of its youth deemed "disengaged" from school.

In his LinkedIn essay, Dalio said that while the inequality in the country is benefiting the wealthiest Americans as much as it ever has, the economy as a whole is losing in the long run. He explained it's resulted in fewer people being able to participate in the economy as both consumers and workers, as well as political tensions he's afraid will tear the country apart.

"I believe that, as a principle, if there is a very big gap in the economic conditions of people who share a budget and there is an economic downturn, there is a high risk of bad conflict," he wrote. He said that as he sees it, the populist uprisings in the US are resulting in a push toward either socialism or the status quo of capitalism as it's practiced, and he thinks that both would weaken the country. Instead, he called for several actions for reform, including increasing taxes on the wealthy and coordinating fiscal and economic policy.

"The most important thing to watch as populism develops is how conflict is handled — whether the opposing forces can coexist to make progress or whether they increasingly 'go to war' to block and hurt each other and cause gridlock," he wrote. "In the worst cases, this conflict causes economic problems (e.g., via paralyzing strikes and demonstrations) and can even lead to moves from democratic leadership to autocratic leadership as happened in a number of countries in the 1930s."

He wrote that there has to be some level of bipartisan support for economic reform going forward, even while recognizing that polarization is intense: "There need to be powerful forces from the top of the country that proclaim the income/wealth/opportunity gap to be a national emergency and take on the responsibility for reengineering the system so that it works better."

For Dalio, America's leadership either takes on inequality as a national emergency and figures out how to reduce it, or the country's days as a superpower are over.

You can read the full essay on LinkedIn »

SEE ALSO: Hedge fund billionaire Ray Dalio says capitalism is failing America, and we need to take 5 specific actions to save it

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Accenture Interactive’s acquisition of Droga5 will fill an obvious hole in its lineup as the company tries to change the way products are marketed (ACN)

Fri, 04/05/2019 - 2:45pm  |  Clusterstock

  • The deal Accenture Interactive announced Wednesday to buy creative agency Droga5 is about more than just having a creative agency in-house, CEO Brian Whipple said.
  • Accenture Interactive wanted to add the creative talents of Droga5's team to its business, he said.
  • The advertising giant has been focusing on helping clients rethink the way their customers discover and interact with their products and services.
  • Whipple thinks Droga5 can help Accenture Interactive come up with imaginative new experiences for its clients.

Accenture Interactive's deal to acquire creative agency Droga5 is more than it might seem on the surface, say the executives behind the merger.

The planned acquisition, which Accenture Interactive announced Wednesday, will fill an obvious hole in its lineup. Despite Accenture Interactive's large and growing presence in the ad business, it hasn't had much of a traditional creative shop in-house, at least not one that primarily serves the giant US market. Droga5 will give it just that.

But Accenture Interactive isn't a traditional advertising firm, and it has bigger plans for Droga5 than to have the agency design ads for its clients, company CEO Brian Whipple told Business Insider. An arm of the giant Accenture consulting firm, which has deep expertise in technology, Accenture Interactive focuses on helping companies rethink and redesign how consumers are introduced to and interact with their products and services. The company plans to tap Droga5 Creative Chairman David Droga and his team to help clients reimagine those experiences, Whipple said.

"There are many experiences out there that have yet to be reinvented," Whipple said, pointing to areas ranging from health care to the way people board planes to the way they try on clothes in stores. "David and his team," he continued, "will be a tremendous benefit to us, in terms of just bringing creative ideas to our clients about their experiences."

Read this: Accenture Interactive just bought Droga5, right after a top exec at the firm said it's 'just getting started' in its plan to disrupt advertising

Indeed, when evaluating Droga5, Accenture Interactive saw in it the potential for a broad definition of the word "creative," Whipple said. Sure, Droga5 could do for Accenture Interactive's clients what creative agencies traditionally do — create ads and marketing campaigns. But it also promised to augment the creative juices within Accenture Interactive, allowing it to be more imaginative in rethinking customer experiences, Whipple said.

"The ideas for reinventing experience are creative by nature," he said.

Droga5 has already been heading in that direction, Droga said. The agency no longer sees itself as just creating advertising messages or building brands — and its clients now expect it to offer more than just that, he said.

The company sees itself as being in the business of helping rethink the way customers come to and interact with their products, he said. For example, Droga5 might help a motorcycle company not just advertise its bikes, but figure out how to help persuade people who have never even thought about riding one before do so, he said.

"We are an ideas entity," Droga said, continuing, "We like to think of ourselves as creating solutions for our clients."

Teaming up with Accenture Interactive is going to allow Droga5 to head in that direction much farther than it could on its own, because of the former's massive size and capabilities, he said.

"They just give us the capacity to execute that far further upstream and downstream than we ever have," Droga said.

At the SXSW conference last month, Accenture showcased some of the work it's been doing on trying to reinvent the way consumers interact with brands. It showed off an augmented reality experience it built for DuPont Corian that allows customers to design their own virtual countertops with digital devices. It also demonstrated an interactive movie poster for Disney's new "Dumbo" movie that changes based on the emotions it detects in viewers' faces.

"We are ... just beginning to scratch the surface with what I've referred to as the experience marketplace," Whipple said.

Got a tip? Contact this reporter via email at twolverton@businessinsider.com, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

SEE ALSO: The head of tech of one of the world's largest consulting firms says the business world's most overhyped new technology is also the most important

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NYSE used a massive red banner to woo Pinterest away from the Nasdaq for its $12 billion IPO (LYFT)

Fri, 04/05/2019 - 2:31pm  |  Clusterstock

Some people use Pinterest for interior design. Others use it for party planning. The New York Stock Exchange uses it to win massive IPOs

Looking to get an edge over Nasdaq for Pinterest's upcoming public listing, in February NYSE displayed a giant, red banner promoting its own Pinterest page, according to the Wall Street Journal.

The banner was free advertising for Pinterest, and ultimately it worked to woo the site to its side. Pinterest, which was last valued over $12 billion in 2017, opted to list with NYSE in its upcoming IPO, rather than its competitor Nasdaq. The company filed a public S-1 at the end of March and is expected to start trading sometime in April.

While the banner kicked off their courtship in a big way, Pinterest ultimately chose NYSE because it offered a large marketing package, according to the Journal.

Nasdaq put up its own fight in the battle for Pinterest. The exchange reportedly reserved the ticker symbol "PINT" to get a leg up, but it didn't work. Instead, Pinterest will use the ticker "PINS" in its upcoming NYSE listing.

The free marketing and specialized tickers are just some of the ways that NYSE and Nasdaq have used perks to compete amid the IPO spree of multi-billion dollar tech startups. Both exchanges have bent their own rules, from dress codes to listing locations, to please the companies they want to take public, according to the Journal.

Read more:  Hot video meeting startup Zoom filed to go public, and it's profitable

Nasdaq, which dominated the tech IPO market during the boom in the late '90s, won Lyft's business and took it public last week. It will also take the video conferencing company Zoom public later in April.

NYSE, however, has won many of the high-profile listings expected in the first half of the year. The exchange will reportedly take both Uber and Slack public, as well as the African e-commerce company Jumia and the enterprise IT management company PagerDuty, which both publicly filed in March.

Join the conversation about this story »

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After 10 years as a financial planner, I've found the best way to keep track of my money is still a simple spreadsheet

Fri, 04/05/2019 - 2:22pm  |  Clusterstock

  • Lauren Lyons Cole is a CFP in New York City.
  • She tracks her own net worth through a simple spreadsheet that she updates with information gathered by money-tracking website Mint.
  • She logs her current net worth on the first day of every month, and cautions people who take the same approach not to expect a straight trajectory upward — the resulting graph will be up and down in the short term, but should increase over time.

Money can be unruly.

But in order to reach your goals, you have to control the chaos. One of the easiest ways to keep track of your financial progress is to monitor your net worth: everything you own minus everything you owe.

Think of it like taking a photo of yourself every day for years — eventually, you'll be able to look back and see how things have changed. No matter where you start, your net worth is likely to get better over time.

As a financial planner in New York City, one of the first tasks I ask my clients to complete is their "current financial snapshot," an overview of every aspect of their financial situation, including account balances. Once you can see all of your money in one place, you can start figuring out what you want to do with it. Added bonus: Getting organized frees up brain space so you don't have to think about money nearly as much.

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It probably comes as no surprise that I love tracking money. But I'm not alone. I've found that once clients get organized, most of them love it too.

I started tracking my expenses in college, using a small blue notebook the New York Times once wrote about. A few years later, I automated the process by linking all of my financial accounts to Mint, which I recommend clients do as well.

And then, in April 2009, one month after the stock market hit its lowest point during the financial crisis, I started tracking my net worth. That was about 10 years ago, and I still update the same simple spreadsheet every month. I use Mint's monthly summary emails to help make the process even easier.

Here's how I do it:

SEE ALSO: The key to retiring a millionaire may depend on maintaining a habit that is easier said than done

DON'T MISS: I'm a financial planner — here's the single best piece of advice I can give you about money

Log your current net worth on the first day of every month. For example:

The spreadsheet I use has four main columns:

• Date

• Net worth (the combined total of investments and cash balances, minus any debt)

• Investments total (any money that is invested, whether in a 401(k), IRA, or other retirement account, as well as taxable investment accounts)

• Cash total (all checking and savings accounts)

I also calculate the percent change since the last month for each of the three categories. The formula I use is:

• Percent change = (This month - Last month)/This month

• For example: =(B3-B2)/B2

 

This allows me to see trends, and serves as a way to see how much I'm saving and what returns I am earning from month-to-month.

To get the numbers, I use Mint's monthly summary email, which usually arrives on the first day of the month.



One of the most helpful parts about using a spreadsheet to track your net worth is creating a chart to visualize the growth over time.

The longer you keep track of your net worth, the more you'll be able to visualize your progress over time. I created a chart tracking net worth by date on a separate tab in my spreadsheet. This is a far easier way to see how your money is growing over time.

It's important to note your net worth will not go up in a straight, pretty line. It will be jagged, and some months your net worth may decrease a bit — if you made a big purchase or if the stock market goes down.

 

Over time, however, your net worth will go up. Keeping track of it could serve as positive reinforcement, or at least a helpful reminder that spending less than you earn is worth it.



You can partially automate the process by requesting monthly summary emails from your account aggregator of choice.

You don't have to use Mint, but it's the account aggregator I prefer. If you don't already have a Mint account, you'll have to create one in order to receive monthly summary emails.

Once you link your checking, savings, retirement, and investment accounts, Mint will keep track of the balances, as well as your transactions.

To sign up for emails, go to "settings" and select "notifications." The first option you'll see is for summary emails, which can be sent weekly, monthly, or never. I recommend receiving it monthly — weekly is too often, and never is ... well, not very helpful.

 

Every month, Mint will send you an email detailing all of your account balances. At the top of the email, you'll see your overall net worth (taking into account any debt you owe) with the label "Your Money."

It also shows the balances for all of your cash accounts and your investment accounts, organized into separate sections. It doesn't provide a total for each category, so you will have to add those up before logging the amount on your spreadsheet.



See the rest of the story at Business Insider

These are the zodiac signs with the most billionaires — and the least

Fri, 04/05/2019 - 2:04pm  |  Clusterstock

  • A new study analyzed the birthdate of each of the top 250 billionaires who featured on Forbes magazine’s latest Billionaire List.
  • Libra was the most common sign, with 27 notable billionaires including Ralph Lauren, Stefan Persson, Liliane Bettencourt, and Alice Walton.
  • Visit Business Insider's homepage for more stories.

Whether you’re a passionate Scorpio, a loyal Leo, or an empathetic Pisces, each zodiac sign has different personality traits. But did you know one zodiac sign, in particular, is the most likely to produce billionaires?

A new study has figured out the most common star sign among the world’s wealthiest billionaires. They analyzed the birthdate of each of the top 250 billionaires who featured on Forbes magazine’s latest Billionaire List — and found Libra is the most common sign.

And, if you believe in horoscopes and you’re a Libra, then you’re more likely to become a billionaire. Lucky for you!

With notable billionaires including Ralph Lauren, Stefan Persson, Liliane Bettencourt, Alice Walton, Libra is the star sign of 27 famous-wealthy faces. Following closely behind is Pisces, with 22 billionaires, including Bernard Arnault, Rupert Murdoch, and Michael Dell.

Cancer, Taurus, Leo are the signs of 20 billionaires, ranking them joint third. Famous faces include Richard Branson (Cancer), Elon Musk (Cancer), Mark Zuckerberg (Taurus), David Koch (Taurus), Larry Ellison (Leo), and Sergey Brin (Leo).

Gemini and Aries are the signs of 15 billionaires each, including Jim Walton (Gemini), Steve Ballmer (Aries), and Mukesh Ambani (Aries).

Aquarius and Virgo are the next richest signs with 12 and 11 billionaires respectively — including Michael Bloomberg (Aquarius), Paul Allen (Aquarius), Warren Buffet (Virgo), and Jack Ma (Virgo). Where does yours rank?

Here are the zodiac signs with most billionaires.

SEE ALSO: Richard Branson on the 'million-dollar lesson they don’t teach in business school' — plus 12 more secrets from highly successful people

1. Libra (September 23 — October 22)

Number of billionaires: 27

Famous Libra billionaires: Ralph Lauren, Stefan Persson, Liliane Bettencourt, Alice Walton

 



2. Pisces (February 19 – March 20)

Number of billionaires: 22

Famous Pisces billionaires: Bernard Arnault, Rupert Murdoch, Michael Dell



3. Cancer (June 21 — July 22)

Number of billionaires: 20

Famous Cancer billionaires: Sir Richard Branson (Virgin Group), Elon Musk, Charlene de Carvalho-Heineken



See the rest of the story at Business Insider

Industry insiders say companies don’t know how to prepare for 5G and are ‘constantly’ asking questions about what it will mean for their business

Fri, 04/05/2019 - 1:59pm  |  Clusterstock

  • Companies are confused about what 5G means to them, investment bankers told Business Insider.
  • 5G isn't uniformly available, and companies are unclear about the difference between fixed 5G and mobile 5G, which complicates companies' ability to plan for it.
  • To the extent wireless carriers rely on other businesses to bring 5G's benefits to fruition, 5G's promise of innovation may be delayed until these companies' questions are resolved.
  • Visit Business Insider's homepage for more stories.

Companies are unclear about what 5G means for them, which complicates their ability to prepare for it, sources at investment banks that work with these companies said.

5G is the next generation of wireless technology. It's expected to deliver faster speed than the current 4G LTE standard and revolutionize the way we live and do business.

The companies that make parts and devices powered by the technology will feel the greatest impact of 5G at first. These companies, like Qualcomm and Samsung, are already building 5G chips for modems and 5G compatible cell phones. Eventually, firms like hardware companies, app makers, and software application platform, will be impacted by 5G, and these types of companies are less sure of their strategy.

The bankers who spoke with Business Insider said they constantly get questions about 5G implementation, and what it will mean for their business. To the extent wireless carriers rely on other businesses to bring 5G's benefits to fruition, innovation stemming from 5G may be delayed until these companies' questions are resolved.

The biggest question is when the technology will roll out, said a managing director at a technology-focused investment bank, speaking anonymously because he was referencing private conversations with clients.

The four main wireless providers (Verizon, AT&T, Sprint, T-Mobile) make it seem like 5G is available today. In fact, 5G is being deployed in phases for internet service providers, smart phone makers, and IOT ecosystem players, like manufacturers of self-driving cars or smart washing machines, the banker said.

Clients want to know things like what they can expect from AT&T's network, what kind of device capabilities Samsung will have, and how Korea's 5G network differs from the one in the US. But 5G is only available in a few cities in North America, with no timeline for expansion.

Availability of 5G is limited to a few cities

Verizon launched 5G mobile in parts of Chicago and Minneapolis Monday. That meant that customers with a specific smartphone who buy an added piece of technology — the Motorola Moto Z3 plus the Moto 5G Mod — can access 5G on their phones. But the areas where consumers can access 5G are extremely sparse, and some people testing the service have said they couldn't get 5G in some of those locations.

Read more: Verizon and AT&T are banking on 5G to connect every device on the planet to the Internet, and it could be a $1.1 trillion opportunity

Companies also are confused about the difference between fixed 5G and mobile 5G, a second managing director at a tech-focused investment bank told Business Insider. The director asked to remain anonymous because his clients include the big four wireless carriers.

Fixed 5G operates similarly to wireless broadband in your home. Cable and telco companies provide internet delivered through cables or fiber that connect to a modem. 5G fixed-wireless broadband provides internet by using radio signals and an antenna outside the home.

Mobile 5G, meanwhile, is a ubiquitous, super-fast internet connection provided outside of the home. The two offer different use cases for businesses. While a smart washing machine, for example, would require fixed 5G, self-driving cars need mobile 5G since they travel far distances. 

The spectrum being auctioned now is high-band, meaning its signal only travels 300 meters at best, so use cases like driverless cars aren't available yet, the second source said.

SEE ALSO: Verizon and AT&T are banking on 5G to connect every device on the planet to the Internet, and it could be a $1.1 trillion opportunity

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Wall Street's biggest Tesla bear says shares are going to crater 80% to $54 (TSLA)

Fri, 04/05/2019 - 1:52pm  |  Clusterstock

  • Wall Street's biggest Tesla bear, Vertical Research's Gordon Johnson, reiterated his "sell" rating and lowered his price target to $54 — 80% below shares were trading Friday.
  • He says Tesla is "running out of people who want to buy its cars."
  • Johnson is also worried about heavy competition coming from the likes of Jaguar, Porsche, and Mercedes.
  • Watch Tesla trade live.

Tesla is set to plunge 80% to $54 a share, a level last seen in May 2013, according to the biggest Tesla bear on Wall Street.

"Tesla is running out of people who want to buy its cars," the Vertical Research analyst Gordon Johnson said. He cited the electric-car maker's weak first-quarter delivery, which showed deliveries were down more than 30% quarter-over-quarter, as being particularly ominous given the exhaustion of European demand, the opening of China to the Model 3, and the recent price cuts in the US.

In light of this, Johnson strongly doubts Tesla will be able to meet its 2019 delivery guidance of 370,000 to 400,000 vehicles, which it reiterated alongside its first-quarter announcement. Deliveries would have to pick up 57% from the first quarter to meet the low-end of the guidance and almost 80% to reach the high-end.

Such a pick-up would come in the face of several headwinds for the electric vehicle manufacturer, according to Johnson, including the continued roll-off of the US federal tax credit and the roll-out of fully electric vehicles from a bevy of competitors including Jaguar, Porsche, and Mercedes (all of which will benefit from the full $7,500 tax credit). In addition, signs of an economic slowdown in the US point to auto sales weakening overall.

Read more: Tesla is in 'demand hell' ahead of its Model Y unveiling, Wall Street's biggest bear says 

And while Johnson is definitely the most bearish Tesla analyst on Wall Street, with a price target almost $260 below the consensus, he's not the only one who was worried about the automaker's first-quarter deliveries. 

"Tesla's 1Q19 vehicle production & deliveries report was substantially worse than expected," JPMorgan analyst Ryan Brinkman, who lowered his price target to $200 after Wednesday's report, told clients in a note out the following day.

In addition to this "demand hell," as Johnson refers to it, Tesla CEO Elon Musk continues to battle the Securities and Exchange Commission. On Friday, Musk was ordered by a federal judge to seek a settlement with the agency within the next two weeks. The SEC has accused Musk of violating a previous settlement with the agency over tweeting misleading disclosure statements.

Tesla shares were down more than 17% this year, trading near $275.

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Elon Musk just had a terrible week and it could easily get worse, fast

Fri, 04/05/2019 - 1:46pm  |  Clusterstock

  • Tesla's legal and financial troubles came to a head this week as the company reported weak deliveries and its CEO went to court in Manhattan.
  • The week epitomized the company's troubles in 2019, with investors starting to wonder about CEO Elon Musk's leadership and the company's cash position.
  • "This f---ing guy's crazy," one investor told Business Insider.

You should forgive yourself if this is the first time you're hearing that the billionaire entrepreneur Elon Musk — with his eyes staring straight ahead, unblinking — went before a judge in Manhattan on Thursday.

He was there flanked by his security guards and three lawyers. The Securities and Exchange Commission was there, represented by three more lawyers. There were journalists and hobbyists and short-sellers in the packed courtroom, all waiting to see whether Judge Alison Nathan would hold Musk in contempt of court.

The US Securities and Exchange Commission had ordered Musk to stop making material statements about his car company, Tesla, on Twitter without approval from an attorney designated by the court. You'll recall that Musk caused company-wide chaos last August when he tweeted he had "funding secured" to take the company private. He ultimately settled with the SEC, which described this and other tweets as "false and misleading."

But the SEC says Musk broke the settlement's rules in February when he tweeted that Tesla would make 500,000 cars in 2019.

It will not.

We know that not only because the company itself has announced lower projections (400,000 at the top) but also because of the other pressing disaster in Tesla land right now — it is not selling enough cars.

The same day Musk sat in the courtroom, Tesla's stock was falling by about 9%. Hours earlier, on Wednesday night — after two days of hemming and hawing — the company released its first-quarter delivery numbers. They were worse than most analysts had imagined. Tesla delivered only 63,000 cars, a roughly 31% drop from the quarter before. And most devastatingly, Tesla was hit the hardest on its most lucrative cars, the luxury Model S and Model X, which saw their sales cut in more than half.

Given all of the problems on Musk's plate, it's no wonder he seemed relieved when the judge deferred a decision on whether he was in contempt of court and asked his lawyers to meet with the SEC once in the next two weeks to see whether they could carve out a deal. "Put on your reasonableness pants on," she said, or she would decide Musk's fate.

Musk left the courtroom and promptly put out a statement dripping with vindication. "I have great respect for Judge Nathan, and I'm pleased with her decision today," the statement said. "The tweet in question was true, immaterial to shareholders, and in no way a violation of my agreement with the SEC." (Nathan had not said any of that.)

It went on: "We have always felt that we should be able to work through any disagreements directly with the SEC, rather than prematurely rushing to court. Today, that is exactly what Judge Nathan instructed."

In a week of losses, Musk could be forgiven for trying to eke out some kind of a win. Neither of Musk or Tesla's major struggles — legal or financial — is in any way resolved, and even long investors are starting to worry.

"Yeah I own the stock. It's not one of my favorite positions. I just think the cars are leaps and bounds above everything else in this field," said Andrew Left of Citron Research, a man who went from short Tesla to long and loud about it.

"It would be better without Elon," Left said, adding: "I think this guy is just a big distraction. It kills me. It comes from the top."

"The communication is terrible," he said. "This f---ing guy's crazy."

The legal issues could get worse, fast. The nightmare scenario in the coming weeks is that the SEC and Musk's lawyers can't come to an agreement and Nathan rules him in contempt.

The financial issues could get worse, fast, too. Tesla is expected to release its Q1 balance sheet in the coming weeks, giving investors a clearer picture of the company's financial position. More bad news could send them running for the hills.

Have a story to share about working for or interacting with Tesla? Contact Business Insider's Linette Lopez at llopez@businessinsider.com.

The link

2019 was supposed to be chill at Tesla, not like 2018, when Musk "bet the company" on the success of the Model 3 car and Tesla was "near death" trying to make that happen. That seemed to pay off in the third and fourth quarters, when Tesla achieved profitability in consecutive quarters for the first time.

But then things started going very wrong. There was a round of layoffs that culled 7%. Sales of more expensive versions of the Model 3 (which was initially promised to the public at $35,000) started to fall. To lower prices across the board, Musk said he would shut down most of the company's stores, but then he took it back. The price of the cars went down and then up again (there were literally protests in China over that). There was an issue with customs in China that delayed sales. There was Musk's errant February tweet, and Tesla's lawyer quitting after being at the company for just two months. Then the SEC came knocking. If it sounds chaotic, that's because it has been. One of Tesla's loyal, top shareholders said that Musk "doesn't need to be CEO."

In short: Elon Musk's tenure as CEO has become tortured.

Some investors are like Gene Munster of Loup Ventures. He still thinks Tesla and Musk need each other, but he considers their relationship a challenge as much as an asset.

"It's a Catch-22," he told Business Insider. "It would be better if Elon weren't making it harder for himself. As an investor there are some things you need to concede, and you need to concede the stability of a regular company."

In court on Thursday, Tesla submitted a letter of support for Musk, but the company itself had not been sanctioned by the SEC over Musk's tweet. That is why the SEC's attorney said Tesla had "for whatever reason thrown its lot in with Mr. Musk," calling it "a problem." She added that the agency was still looking into whether Tesla shirked its duties by allowing Musk's errant tweet.

As a remedy, the SEC suggested putting a new system in place to approve and monitor Musk's tweets. It also suggested a scale of fines if he tweeted misinformation again.

"The company definitely needs more professional management," Chester Spatt, a professor of finance at Carnegie Mellon who was previously the chief economist at the SEC, told Business Insider. "Musk's lawyers must also be afraid of him. They can't control him. I think there's a reasonable chance in the next two weeks that Musk and Tesla overplay their hand in negotiating with the SEC."

Spatt added: "I think the SEC, by not trying to take him down, is giving a lot. But in effect Tesla has to comply with the prior settlement, no two ways about that."

In the background of all this legal drama, the SEC and the Department of Justice are still investigating Tesla and Musk over whether they misled investors about the production of the Model 3.

The bet

It is because of the Model 3 that Tesla is in dire financial straits. Tesla started out by making a more expensive, longer-range version of the car, but it was initially marketed as a $35,000 vehicle for the everyman. Thousands gave the company a $1,000 deposit to reserve one.

But that $35,000 car isn't here yet. And sales of the higher-margin, long-range version slumped in Q1. Tesla's luxury cars fared even worse. Analysts are starting to wonder whether there is much demand for the cars that will actually make Tesla a profitable company.

"We are lowering our estimates and price target on Tesla shares today (to $200 from $215), reflecting the softer 1Q deliveries and flow-through of what we see as reduced underlying demand going forward for the higher ASP [average selling price] S & X," analysts at JPMorgan wrote.

Like all car companies, Tesla is expensive to run. It needs $1.5 billion to $2 billion on hand to keep the lights on. In March it paid off a $920 million loan, and it has more debt coming due over the next year. That's partly why the ratings agency Moody's warned that despite Tesla's success in 2018, "meaningful pressures weigh on Tesla's credit profile."

And that was even before Q1 deliveries turned out to be a dud. The company is expected to report earnings in the coming weeks, and more bad news would put additional pressure on management to right its financial ship. Most likely it will bring up an old question: Will Tesla raise money? The company used to say in no uncertain terms that it would not. Toward the end of last year it softened its stance.

"They're going to lose money March quarter and they didn't think they would," Munster said, adding that the company could lose money in its next quarter as well and questioning why Tesla wasn't raising more money. "They don't have as much money now as they said they would six months ago," he said.

Tesla needs money not just to survive but to finance its plans. It's building a new factory in China, for which it raised $500 million (due next March) from a syndicate of Chinese banks.

It also recently unveiled a new car, the Model Y, which should start production next year. The Model Y's unveiling last month was itself a sign of Tesla's tougher times. There was something missing.

It wasn't the cars. There were plenty of cars. Every model the company had made or proposed was trotted out for all to see — the Roadster, the Model S, the Model X, the Model 3, the semi. It wasn't the hype, because Musk, in a pair of custom-made Jordans, was full of it.

What was missing was the affair's usual whiz-bang finale. You see, in Tesla land, at the end of every unveiling there is an "and one more thing" moment when the company gives the faithful one last wow, pulling another trick from its sleeve. But there was no thing this time, and Wall Street sent the stock down 4% the next day.

The market just didn't seem impressed anymore.

Have a story to share about working for or interacting with Tesla? Contact Business Insider's Linette Lopez at llopez@businessinsider.com.

SEE ALSO: Here's how Elon Musk's tussle with federal regulators went down in court

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A startup seeded by Silicon Valley's hottest mentorship program aims to bring the first male birth control to market

Fri, 04/05/2019 - 1:46pm  |  Clusterstock

  • A new startup called YourChoice Therapeutics aims to bring the first hormone-free male and female birth control drug to market.
  • The company debuted at a recent demo day hosted by Silicon Valley tech hub Y Combinator.
  • Stacked with researchers from UC Berkeley, the startup has published several basic studies in top-notch science journals.
  • Still, the field of male birth control is a tough nut to crack, and the company faces challenges.

When University of California at Berkeley scientists Polina Lishko and Nadja Mannowetz first dreamt up the idea for a new kind of birth control, they didn't intend to create an option for men. Instead, they aimed to design a women's contraceptive free from the laundry list of negative side effects tied to today's Pill.

But a few years and several published papers later, and they realized the drug they were creating could be taken by both women and men. At a demo day hosted by Silicon Valley tech hub Y Combinator last month, they debuted as a startup called YourChoice Therapeutics.

Although their science is still early, YourChoice's team has created the foundation for a hormone-free method that would prevent pregnancy by robbing a man's sperm of the energy it would need to fertilize a woman's egg. Outside experts call the approach "promising."

The drug would work as a kind of one-two punch, Akash Bakshi, the CEO of YourChoice, told Business Insider.

First, it would prevent hundreds of millions of sperm from swimming to an egg by essentially disabling their main power source — their tails. As an added back-up in case a few crafty sperm find their way to an egg anyway, YourChoice's drug would also disable the drilling action they need to fertilize the egg.

"The idea is that men and women can take this so a man's sperm will a) not have the energy to get to the egg, and b) if they do get to the egg, they won't be able to drill," Bakshi said.

Because it doesn't contain hormones, the drug would also be free from the side effects linked to current hormone-based women's contraceptives. Those side effects include migraine headaches, weight gain, mood swings, and more. And while no male birth control has yet been brought to market, some of the drugs being studied could come with side effects like erectile dysfunction (ED) and reduced sex drive.

Your Choice hopes to avoid those side effects by steering clear of hormones and crippling sperm activity instead.

"Scientifically their approach is really well-positioned. It's a good target," Logan Nickels, the director of operations for a nonprofit research organization called the Male Contraceptive Initiative, told Business Insider.

'Male options stand to be a game-changer' for the contraceptive field

Despite a host of recent innovations from companies like YourChoice and others, the contraception landscape has remained relatively unchanged for nearly half a century. Funding is a major obstacle. Politics plays a role too.

"The contraceptive space has limited funding as it is, and it's been very focused on women for years," Heather Vahdat, the executive director of the Male Contraceptive Initiative, told Business Insider.

"I think the momentum's just picked up on male methods in general," she added.

Mannowetz and her team agree.

"The contraceptive burden has been on women for forever," Mannowetz said. "We're still using the same products our grandmothers used."

But in recent years, a handful of new initiatives have emerged with aims to broaden the landscape and give new options to both men and women.

"These male options stand to be a game-changer," Vahdat said. "It feels like we've finally turned a corner."

Two recent drugs under investigation include a hormone-based male birth control gel that scientists began testing in the US last December. The drug is rubbed daily on the shoulders and would work by reducing sperm count. A pill that works in a similar manner is also being studied. However, both hormonal drugs have been tied with side effects including ED and reduced sex drive. For these reasons and others, Vahdat and Nickels believe a male birth control option is at least 10 years away.

Other researchers are exploring non-hormonal formulations to try and avoid those side effects. Most of them work by disrupting the interaction between the sperm and the egg.

For its part, YourChoice's non-hormonal approach uses small molecules inspired by a drug called lupeol and has published several peer-reviewed studies in journals like Science and the Proceedings of the National Academy of Sciences outlining their basic approach. The company has raised an undisclosed amount that includes seed funding from Y Combinator. In the next few years, it hopes to progress from pre-clinical studies to studies in preparation for clinical trials.

The goal is to have a product on the market within the next eight to 10 years.

"That's one good thing about being an underdog — your leaps are going to be fundamentally game-changing," Vahdat said.

SEE ALSO: A Silicon Valley startup just launched a DNA-based health test that could be a big competitor to 23andMe

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Dispensed: Venture-backed insurance startup Bright Health's 2018 results, a dispute between 2 drug giants, and the quest for a male birth control drug

Fri, 04/05/2019 - 11:48am  |  Clusterstock

Hello,

Welcome to Dispensed, our weekly newsletter recapping all the big healthcare stories that kept our team busy this week. For those who are new to the newsletter, I'm Lydia Ramsey, a senior reporter here on the team. 

I'm curious to hear what you all think of Cigna and Express Scripts' program that caps a 30-day supply of insulin at $25 for patients. How many plans will pick this up? How many patients will this impact? I guess time will tell. 

It'll also be interesting to see how the healthcare industry taps into Alexa now that Amazon's voice assistant is HIPAA compliant. Would you want to set up an appointment or give your doctor an update via the Echo Dot in your living room?

One thing to keep an eye on: the FDA is holding a hearing about cannabis next month. One day, it might be legal to make foods and drinks with certain levels of the cannabis extract CBD, at least according to a recent note from outgoing FDA Commissioner Scott Gottlieb.

New to our newsletter? You can subscribe here.

Erin Brodwin had the story on the newest test out using the Helix DNA kit. It looks at risk of some of the same conditions 23andMe looks at, but includes genetic counseling and requires a doctor's sign-off. Here's what you need to know about it. 

A Silicon Valley startup just launched a DNA-based health test that could be a big competitor to 23andMe
  • On Tuesday, DNA testing startup Helix launched a new test that looks at your risk of diseases like breast cancer, colon cancer, and high cholesterol.
  • You can buy the test online for $260, but it must be approved by a physician.
  • Helix partnered with clinical diagnostics company PerkinElmer to create the test, which includes genetics counseling.
  • The test also uses a type of sequencing that some experts say all DNA-based health tests should use.

I had the scoop on venture-backed health insurer Bright Health's 2019 enrollment and revenue expectations. Those numbers, and the company's 2018 results based on regulatory filings, suggest that the insurer is managing to double its footprint every year (its first year offering plans was 2017). So far, it's been holding losses steady.  

We got a look at the 2019 plans for venture-backed health-insurance startup Bright Health, which says it doubled its membership again
  • Bright Health, the Minneapolis-based health-insurance startup that provides health plans for individuals and families and to seniors, made $145 million in gross revenue in 2018, its second year offering health plans.
  • According to state filings, Bright lost $17.5 million in 2018, the same as in 2017. At the same time, it doubled its membership base to more than 24,000 from 12,000.
  • Bright Health CEO Bob Sheehy told Business Insider the company expected to jump to about $400 million in revenue for 2019 and had signed on more than 60,000 members.

And if you need a recap of how all the health insurance startups fared in 2018 and what's ahead for 2019 and 2020, I've got you covered.

Health-insurance startups like Oscar Health and Clover Health have raked in $1.3 billion in the past year. We took a look at their financials, which show how hard it is to get a foothold in the industry.
  • Startups have attracted massive funding in the past few years to build new kinds of health-insurance plans — with the help of technology.
  • In the past year, four companies in particular — Oscar Health, Devoted Health, Bright Health, and Clover Health — brought in a combined $1.3 billion in funding.

Emma Court has the story of the race to successfully develop a cancer drug targeting the KRAS mutation. 

A $23 billion drugmaker and a $2 billion biotech upstart are racing to develop a type of 'silver bullet' drug for aggressive cancers that has eluded their industry for 30 years
  • Pharmaceutical companies long wanted to develop a drug that would target KRAS, a common gene mutation seen in cancers. But every effort so far has failed.
  • The pharmaceutical company Amgen and biotech Mirati are backing two new drugs that are raising those hopes again, though it's still early days.
  • If these experimental products are successful, they could rake in billions in sales and help patients with few treatment options. 

Emma also chatted with the top scientist at AveXis, which Novartis acquired last year. He broke down why the Swiss pharma giant was so interested in the gene-therapy maker.

The top scientist at AveXis told us it got sold to Novartis for $9 billion because of this 'unique' strength that could shape the future of gene therapy
  • The biotech AveXis develops cutting-edge "gene therapy" products that could be powerful and long-lasting medical treatments.
  • Swiss drug giant Novartis bought the biotech for $9 billion last year in part because AveXis had figured out how to actually make gene therapies at a big-enough scale, AveXis Chief Scientific Officer Brian Kaspar told Business Insider.
  • Manufacturing has emerged as a huge challenge for the booming industry because these products are so new and complex.

And for those just catching up on Thursday's lawsuit — Emma broke down the significance of the dispute between Amgen and Novartis over their new migraine drug, Aimovig. 

2 drug giants are feuding over a highly successful new migraine drug, and court documents reveal how profitable the $10 billion market could be
  • Two drugmakers, Amgen and Novartis, have worked together for years on a new type of cutting-edge migraine drug, Aimovig.
  • Now they're involved in a bitter fight. Amgen is trying to get out of the collaboration, while Novartis is suing Amgen to keep it in place.
  • Aimovig costs roughly $7,000 a year and was the first of a new category of migraine drugs to get to market. The lawsuit provides a window into how successful it has been and how much Novartis stands to lose in the disagreement. 

Out on the West Coast, Erin took a look at a startup coming out of Y Combinator that wants to crack the male birth control market. 

A Berkeley-stacked startup backed by Silicon Valley's top tech hub is developing male birth control that experts call promising
  • A new startup called Your Choice Therapeutics aims to bring the first hormone-free male and female birth control drug to market.
  • The company debuted at a recent demo day hosted by Silicon Valley tech hub Y Combinator.
  • Stacked with researchers from UC Berkeley, the startup has published several basic studies in top-notch science journals.
  • Still, the field of male birth control is a tough nut to crack, and the company faces challenges.

For those eager to hear what comes out of the PBM grilling next week in the Senate, we'll be following along. Find Emma and me on Twitter, where I'm sure we'll post some live updates.

In the meantime, be sure to send tips, thoughts, and ideas for how you'd use now-HIPAA-compliant Alexa to lramsey@businessinsider.com, or you can find the whole healthcare team at healthcare@businessinsider.com. 

- Lydia 

Join the conversation about this story »

NOW WATCH: A molecular biologist warns chemicals in plastic can seep into food and lead to major health effects like obesity, heart disease, and diabetes

Majik Water #Kenya is extracting drinkable water from the air

Fri, 04/05/2019 - 11:21am  |  Timbuktu Chronicles
Under the leadership of Beth Koigi, Anastasia Kaschenko, and Clare Sewell Majik Water has developed an underlying technology that:
...uses desiccants such as silica gels to absorb water from the air. These are then heated to release the water which is finally collected.via WeeTracker

Markets Live: Friday, 5th April 2019

Fri, 04/05/2019 - 6:02am  |  FT Alphaville

Live markets commentary from FT.com

Continue reading: Markets Live: Friday, 5th April 2019

Trump reportedly wanted to fast-track his IRS chief counsel's nomination and prioritized it over his attorney general

Fri, 04/05/2019 - 1:48am  |  Clusterstock

  • President Donald Trump wanted to fast-track the IRS chief counsel's nomination through the Senate, according to a New York Times report published Thursday.
  • Trump reportedly broached the topic regarding his IRS pick, Michael Desmond, with Senate Majority Leader Mitch McConnell on February 5.
  • Desmond, a former tax attorney at the Justice Department and Treasury Department, was confirmed three weeks later.
  • Desmond briefly advised the Trump Organization sometime between 2008 and 2011, according to a Bloomberg report published last year.
  • The Times' reporting comes as Democrats seek to obtain Trump's tax returns.
  • Visit Business Insider's homepage for more stories.

President Donald Trump wanted to fast-track the IRS chief counsel's nomination through the Senate and suggested it was more important than Attorney General William Barr's nomination, a source with knowledge of the conversation said in a New York Times report published on Thursday.

Trump reportedly broached the topic regarding his IRS pick, Michael Desmond, with Senate Majority Leader Mitch McConnell on February 5, according to The Times. Trump told McConnell that Desmond was aggravated by the prolonged process and had even considered withdrawing from consideration, The Times' source said.

Desmond, a former tax attorney at the Justice Department and Treasury Department, was confirmed three weeks later.

Desmond briefly advised the Trump Organization sometime between 2008 and 2011, according to a Bloomberg report published last year. A spokesman for Desmond reportedly said in a statement that Desmond's work involved a "discrete reporting matter for a subsidiary company that was resolved with no tax impact."

Read more: Democratic lawmaker asks IRS for 6 years of Trump's tax returns

The Times' report comes as Democrats seek to obtain Trump's tax returns.

Democrats have long called for the tax returns to investigate potential conflicts of interests or financial wrongdoing.

Democratic Rep. Richard Neal, the chairman of the House Ways and Means Committee, on Wednesday cited an obscure "committee access" tax provision in his request that the IRS release six years' worth of Trump's tax returns.

The tax provision, which was created in 1924 and was last invoked in the 1970s, allows the finance committees to request tax returns from individual filers.

"We have completed the necessary groundwork for a request of this magnitude and I am certain we are within our legitimate legislative, legal, and oversight rights," Neal said in a statement.

"My actions reflect an abiding reverence for our democracy and our institutions, and are in no way based on emotion of the moment or partisanship," Neal said.

Republicans criticized the request, calling it "an abuse of the tax-writing committees' statutory authority."

"Weaponizing our nation's tax code by targeting political foes sets a dangerous precedent and weakens Americans' privacy rights," Republican Rep. Kevin Brady of Texas reportedly said in a letter. "As you know, by law all Americans have a fundamental right to the privacy of the personal information found in their tax returns."

Trump became the first president in decades not to release his tax returns before his election. On Wednesday, Trump repeated his longstanding claim that the IRS is auditing his returns, citing that as the reason why he hasn't released them. He referred any tax-related inquiries to his attorneys and the attorney general.

"We're under audit, despite what people said," Trump told reporters. "We're working that out. I'm always under audit, it seems. But I've been under audit because the numbers are big. And I guess when you have a name, you're audited."

It is unclear if Trump is currently being audited. There is no law that prohibits a tax filer from releasing his tax returns during an IRS audit.

SEE ALSO: Marine Corps general reportedly leaked a sensitive memo questioning Trump's border plan

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Jeff Bezos will still be the richest man in the world after his divorce, even though MacKenzie Bezos is keeping 25% of the Amazon shares (AMZN)

Thu, 04/04/2019 - 8:03pm  |  Clusterstock

  • Jeff Bezos and MacKenzie Bezos have finalized the terms of their divorce after 25 years of marriage, the couple announced on Thursday.
  • As part of the divorce agreement, MacKenzie Bezos said she would give Jeff Bezos 75% of their Amazon stock, plus all the couple's interests in The Washington Post and Blue Origin.
  • With his revised stake, Bezos' net worth will decrease, but he'll still holds the title of the richest person.

The richest couple — Jeff and MacKenzie Bezos — is in the midst of finalizing their divorce. But when the dust settles, the Amazon CEO's reign as the richest person is unlikely to end. 

The couple released separate statements on Thursday announcing they had "finished the process of dissolving" their marriage of 25 years. As part of the divorce agreement, MacKenzie Bezos said she would give Jeff Bezos 75% of the Amazon stock they co-owned, as well as all of her interests in the Washington Post and Blue Origin.

MacKenzie Bezos' 25% stake in Amazon positions the novelist to become one of the richest women, with a net worth of about $35.7 billion at Amazon's current stock price.

Read more: Jeff Bezos' divorce won't affect his voting power at Amazon, because MacKenzie is giving him control

However, the billionaires' list isn't a new place for her soon-to-be ex-husband, Jeff Bezos. The Amazon founder and CEO has held the title of the richest person since surpassing Bill Gates back in October 2017. Bezos has been steadily building his fortune since then, and the latest Forbes' billionaires ranking had his net worth at $131 billion.

But with the divorce agreement, Bezos' net worth is set to decrease. His 75% stake will give him 59.1 million shares in Amazon. Based on current market prices, Bezos' post-divorce revised stake in Amazon is worth an estimated $107.4 billion.

That Amazon stake alone stands to put Bezos' net worth above that of Bill Gates, whose net worth is an estimated $96.5 billion, according to Forbes

It's unclear how the couple will be splitting up their massive stockpile of real-estate holdings. A 2017 report listed the Bezoses as the country's 28th largest landowner, with properties in Medina, Washington; Van Horn, Texas; Washington, DC; Manhattan, New York; and two mansions in Beverly Hills, California.

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NOW WATCH: We tried the Samsung Galaxy S10 to find out if it's worth the $1,000

Boeing investigation reportedly finds new software problem on 737 Max planes (BA)

Thu, 04/04/2019 - 6:57pm  |  Clusterstock

  • The Federal Aviation Administration (FAA) has ordered Boeing to fix a newly discovered software issue in its 737 Max aircraft before allowing it to fly.
  • Boeing officials reportedly described the new software problem as "relatively minor" and said it was unrelated to the anti-stall system that is being investigated after two 737 Max crashes.
  • Officials with knowledge of the FAA's probe said the fix for this new problem is essential for safety.

The Federal Aviation Administration has ordered Boeing to fix a newly discovered software issue in its 737 Max aircraft before allowing it to fly, according to a Washington Post report published on Thursday.

Boeing officials reportedly described the new software problem as "relatively minor" and said it was unrelated to the anti-stall system that is being investigated after two deadly 737 Max crashes happened just months apart. Nevertheless, officials with knowledge of the FAA's probe said the fix is essential for safety.

Three hundred and forty-six passengers and crew members were killed after two 737 Max aircraft — Lion Air Flight 610 and Ethiopian Airlines Flight 302 — crashed within a span of five months. The aircraft has been grounded in the US and many other countries.

The 737 Max's new automated safety feature has been under intense scrutiny as Boeing and aviation authorities investigate the crashes. Initial reports suggest that a faulty reading from a sensor could have played a role in both crashes. The reports indicated that the faulty sensor may have triggered the plane's automated system and pointed the nose downward after takeoff.

Some pilots were reportedly unaware of the safety feature and also believe they did not receive adequate training with the new system. Boeing's software update and "comprehensive pilot training" will address issues with the suspected faulty system, the company said in a statement on Thursday.

"Safety is a core value for everyone at Boeing and the safety of our airplanes, our customers' passengers and crews is always our top priority," Boeing said in a statement.

"Boeing's technical experts continue to assist in this investigation and company-wide teams are working to address lessons from the Lion Air Flight 610 accident in October," the company added.

SEE ALSO: An off-duty pilot reportedly prevented a Boeing 737 Max 8 crash one day before the same plane crashed and killed 189 passengers and crew

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Striking photos of businessmen sleeping on dirty streets illustrate Japan's tireless work culture

Thu, 04/04/2019 - 6:47pm  |  Clusterstock

SEE ALSO: A photographer captured the last 10 years his parents spent together, and the heartbreaking photos provide an intimate look at enduring love and loss

Jaszczuk, who divides his time and work between Warsaw and Japan, told Business Insider that he was living in Tokyo when he began to notice a unique phenomenon.

In the wee hours of the night, he noticed men dressed in business suits fast asleep on the streets of Tokyo.

"The contrast between well-dressed men and the street got my attention," Jaszczuk said.

See the rest of the story at Business Insider

Tesla just updated its ‘Navigate on Autopilot’ feature — here’s what’s new (TSLA)

Thu, 04/04/2019 - 6:45pm  |  Clusterstock


Last year, Tesla released a software update to its Autopilot semi-self-driving system, called "Navigate on Autopilot." The feature combined GPS navigation with Autopilot's advanced cruise control and autosteer functions to enable a properly equipped vehicle to follow a digital route on highways.

Now the carmaker has updated the feature with a few tweaks.

"Tesla drivers have traveled more than 66 million miles using the [Navigate on Autopilot], and more than 9 million suggested lane changes have been successfully executed with the feature in use," Tesla said in a statement.

Read more: I tried Tesla's Navigate on Autopilot feature to see if it lives up to the hype — here's the verdict

"We’ve heard from our customers that it makes road trips and highway driving more relaxing, enjoyable, and fun, and gives them an easy way to follow their car’s navigation guidance when traveling on an unfamiliar route."

I tested Navigate on Autopilot last year (briefly) and found that it was impressive, but that it also asked for more driver engagement than previous versions of Autopilot.

Lane changes can now happen almost automatically

The main update to the feature involves lane changes. Before, the driver had to confirm a lane switch, suggested by Navigate on Autopilot, using the turn-signal stalk. The update removes that requirement, but without lessening driver involvement.

"If a driver selects 'No' to Require Lane Change Confirmation, lane changes will happen automatically, without requiring a driver to confirm them first," Tesla explained in a blog post.

Drivers can elect to get notified about an upcoming lane change by receiving an audible chime as well as a default visual prompt. Additionally, all cars made after August 2017 will also have the option to have their steering wheel vibrate for the alert as well."

The driver's hands have to be on the wheel when the lane change is executed.

A new "Customize Navigate on Autopilot" option has also been added. In addition to "Require Lane Change Confirmation" and "Lane Change Notification" settings, the feature can be configured to activate by default on a highway whenever a destination is plugged in to the navigation system via the central touchscreen on the Models S, X, and 3.

The update to Navigate on Autopilot is classic Tesla. It became available to owners in the US on Wednesday, as long as they had added Enhanced Autopilot or Full Self-Driving Capability to their vehicles. It was an over-the-air software update, a modest, iterative improvement to an existing Tesla feature, requiring owners to do nothing more than  accept the update.

Tesla said that pending regulatory approval, the feature would eventually be offered in markets outside the US. 

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Meet MacKenzie Bezos, who stands to become one of the world's richest women after her divorce, was one of the first Amazon employees, and has written 2 award-winning novels

Thu, 04/04/2019 - 5:55pm  |  Clusterstock

  • MacKenzie Bezos and Amazon CEO Jeff Bezos announced that they had finalized the terms of their divorce on Twitter on April 4.
  • She is an award-winning novelist, who's had literary ambitions since she was six years old.
  • She's now the author of two novels, "The Testing of Luther Albright" and "Traps."

When Jeff Bezos told his then-wife MacKenzie about his idea for a new company, she was immediately on board.

Bezos traveled with her husband to Seattle, where she worked for the fledgling Amazon as an accountant.

The move was a bit of a departure for the Princeton grad, who had long dreamed of becoming a writer. But she was eager to support her husband.

"To me, watching your spouse, somebody that you love, have an adventure — what is better than that?" MacKenzie said during an interview with CBS.

Since the early days of Amazon, Bezos has gone on to pursue her literary dreams, publishing two novels, "The Testing of Luther Albright" in 2005 and "Traps" in 2013. 

The couple announced their plans to divorce in January 2019, and declared that they had finalized the terms of their divorce on April 4, 2019. In a tweet, MacKenzie explained that should would be passing on "all of my interests in the Washington Post and Blue Origin, and 75% of our Amazon stock plus voting control of my shares to support his continued contributions with the teams of those incredible companies."

Business Insider's Hillary Hoffower wrote that the novelist's remaining shares still likely leave her as one of the world's richest women.

Here's a look at the career of award-winning novelist MacKenzie Bezos:

SEE ALSO: A look inside the marriage of world's richest couple, Jeff and MacKenzie Bezos — who met at work, were engaged in 3 months, and own more land than almost anyone else in America

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MacKenzie grew up in San Francisco. She told Vogue she was a shy child who would often stay in her bedroom writing "elaborate stories."

Source: Vogue



She authored her first book — "The Book Worm" — at the age of six. The handwritten, 142-page novel was later lost in a flood, according to her Amazon author bio.

Source: Amazon



After high school, MacKenzie attended Hotchkiss, then transferred to Princeton in order to study fiction with Pulitzer Prize-winning author Toni Morrison.

Source: Vogue



See the rest of the story at Business Insider


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