Good Wednesday. The Elon Musk-backed company Neuralink presented their plans to connect your brain to the internet last night – more on that below. Register here .)
A glimpse of how lawmakers can rein in Big Tech
Lawmakers took photos of tech giants yesterday during three hearings on Capitol Hill. Amazon, Apple, Facebook, and Google faced questions about their market power, experienced disruptions such as communications gatekeepers and, in the Facebook case, plans to transform the financial industry.
• Representative David Cicilline, the democratic leader of the subcommittee, pushed them on the technology company's marketplaces – for goods, software applications and online advertising – giving them an unfair advantage over competitors who rely on those marketplaces to distribute their own products or services.
• Representative Joe Neguse, Democrat of Colorado, zeroed in on their M. & A. He pointed out that Facebook owns four of the world's six largest social networks (in itself, along with Instagram, Messenger and WhatsApp). "We have a word for it," said Mr. Neguse. "It's called monopoly."
"The hearing appearances were a narrative moment showing the rising power of the backlash towards the tech giants," said Mr. Lohr, Mr. Isaac and Mr. Popper. "Not long ago, considered taxes of American capitalism, they are now targets of both parties' political attacks, increasing public criticism and regulatory inquiry."
More: Google said it had officially deleted its search engine project in China code name Dragonfly. And E.U. is allegedly set to launch a formal antitrust investigation to Amazon's dual role of seller and market platform.
Facebook's biggest problem with Libra? Even
Lawmakers made one thing clear by a Senate Banking Committee's hearing yesterday: The biggest junction of the Cryptocurrency plans in Facebook is the company's reputation, Mike Isaac and Nathaniel Popper of NYT write.
The hearing began with a stabbing criticism by Senator Sherrod Brown, the Democrat of Ohio:
"As a toddler who has got the hands of a book of fighting, Facebook has burned down the house about And again, every arson called a teaching experience, we would be mad to give them the chance to experiment with people's bank accounts and use powerful tools they don't understand, like monetary policy. "
It didn't get much better as David Marcus, who leads Facebook's cryptocurrency initiative, was questioned for more than two hours. Legislators brought up many of Facebook's error tracks – including data security and Russian disruption – to highlight concerns about the company's entry into finance.
Our critics are now on the rise. Just last week, Secretary of State Steven Mnuchin, President Trump and Fed Chairman Jay Powell, have raised concerns about the project.
Surprisingly, Marcus hit a redeeming tone. "We have made mistakes in the past," he said. "We've been working and working hard to get better."
• But when asked by Mr. Brown if lawmakers could persuade Facebook to scratch Libra, Marcus simply said that the company would not move on to regulators Concerns were addressed.
Libra is facing another grilling today that Facebook officials look forward to the House Financial Services Committee at 10 am East.
More: Facebook is said to have briefed authorities on its Libra plans last month, but the meeting allegedly just reinforced concerns that the company was no longer prepared for to deal with major problems.
Trump's unintentional power over the Fed
] President Trump has repeatedly and publicly tried to jaw the Fed to lower interest rates. But he may have found a better way to make it happen, writes Jeanna Smialek from NYT: his own policy.
There is a strange time for the Fed to cut prices, given signs of strength in the US economy. Retail sales in June were strong and production activity picked up.
But Mr. Trump's trade wars have undermined the global economy which is now struggling with China's downturn and a fall in production.
Economic uncertainties "have increased," especially on trade, Jay Powell, the Fed leader, said at a conference in Paris yesterday. He said the central bank would "act as appropriate to maintain the expansion."
So that, instead of Mr. Trump's slamming, could force the Fed's hand to cut prices, writes Ms. Smialek. Investors certainly seem to believe that the central bank will work that way, if prices in federal fund futures markets are something to go by. (The central bank's silent meeting period begins Saturday, so the chances of changing that perception are becoming increasingly limited.)
Three takeaways from the bank earnings season
Many of Wall Street's top banks have reported second quarter results this week and the news has been in largely positive. Here's what we've learned so far.
Trading is mostly in a funk. Both Citigroup and JPMorgan Chase reported disappointing trading revenues, reflecting a prolonged decline in what had been Wall Street's most profitable business. The exception so far: Goldman Sachs.
Banks are worried about falling interest rates. JPMorgan cut the forecast for net interest income for the rest of the year, and sent the cards its shares lower, despite analysts' overall profit expectations being beaten. And Wells Fargo said lower prices would affect the bottom line.
Consumers are big companies. JPMorgan advises its consumer lending business, which reported an increase of 22 percent in the same period last year. And Goldman is still focused on building projects such as Marcus Banking Unit and its Apple Card Initiative, despite spending $ 1.3 billion on them so far.
We find out more when Bank of America reports today and Morgan Stanley in the morning.
A glimpse of Elon Musk's plan to hook up your brain
Neuralink, a neuroscience company where Mr. Musk has invested $ 100 million, officially revealed his big product last night: a unit that could one day connect to the brain direct to the internet, John Markoff of NYT writes.
• "Neuralink described a sewing machine-like robot that can implant ultrathin threads deep into the brain."
• "The company showed a system connected to a laboratory rat reading information from 1500 electrodes – 15 times better than today's systems embedded in humans. That's enough for scientific research or medical applications."
• "The company hopes to begin to work on human topics as soon as the second quarter next year. "
• The company said it could" help people with a number of Neilink's greatest challenges will live up to Mr. Musk's grand vision. "
One of Neuralink's biggest challenges will live up to Mr. Musk's grand vision. "Independent scientists warn that laboratory animal results may not exceed human success, and human efforts will be required to determine the promise of technologies," says Markoff.
Why Midsize Cities Can't Make Up With Mega Rivals  Winston-Salem, NC, has ambitions to become a center for biotechnology research. But as far as the dream has not been realized – and it raises questions about whether medium-sized cities can grow into thriving metropolises, Eduardo Porter writes from NYT.
The model after World War II is destroyed. Previously, smaller towns could get hold of becoming production centers. But in the age of technology it is more difficult to keep up with Silicon Valley and New York.
Blame a number of factors. Today's economy doesn't really appreciate the kind of cheaper labor that such cities traditionally boast of. Employers instead set up centers of highly educated workers, starting a virtuous circle of more facilities and funding, and then more workers. It is more difficult for medium-sized cities to compete.
Winston-Salem's failed bid for Amazon's HQ2 is a case study of how it looks in practice. "If you go down the Amazon checklist, it requires everything we do not have," said Koleman Strumpf, an economics professor at Wake Forest University, located in Winston-Salem, Mr. Porter said. "We don't have bulk shipping. No Amtrak. No good airports. It's not a walkable city. It has no good facilities."
How North Korea gets its luxury cars
Kim Jong-un, the country's leader, has some serious wheels: the top model Mercedes-Benzes and Rolls Royces. It's just a sign that North Korea, despite the odds, has found a way to evade UN sanctions intended to prevent access to luxury goods, Ed Wong and Christoph Koettl of the NYT report.
• "High-end Western goods make themselves into the elite of North Korea through a complex system of port transfers, secret seaboats and shady defense companies, according to research by the Center for Advanced Defense Studies," they wrote.
• "From 2015 to 2017, so many as 90 countries served as sources of luxury goods for North Korean, "including China, Japan, Russia and South Korea.
• A couple of Mercedeses took a long journey to Pyongyang: from Rotterdam in the Netherlands to China, Japan and South Korea – and saw a mysterious stretch where the ship carrying them went off the grid, the cars may have entered Russia and then flown to North Korea.
• "The accident points to potential restrictions on sanctions as a tool for Trump administration to push Pyongyang into serious negotiations to end its nuclear weapons program. " Revolving Door
Dr. Leana Wen was expelled as President of Planned Parents.
KKR has employed Emilia Sherifova from Northwestern Mutual as its top information and innovation officer.
The European Parliament nodded Ursula von der Leyen by Germany as the next head of the European Commission.
Steve Coh's Point72 Asset Management has lost at least 20 portfolio managers this year, five of them competing with the Citadel.
Deutsche Bank has poached 13 banks with wealth banks from Credit Suisse.
Offers  • French Finance Minister Bruno Le Maire said preserving Renault's alliance with Nissan was more important than finding the French automaker a merger partner like Fiat Chrysler. (Reuters)
• Goldman Sachs says its pipeline of M. & A. projects is a bit up. JPMorgan Chase says it's gone down. (FT)
• The UK competition regulator will investigate the sale of the satellite company Inmarsat to a private equity consortium. (Reuters)
• Barry Dillers IAC agreed to buy a $ 250 million stake in Turo, the car sharing service, for a valuation of over $ 1 billion. (WSJ)
• Slips between the finance minister and Ehud Barak, Israel's former prime minister, have added drama to the Middle East's policies. ( NEWS)
• The fake passport exists in Mr. Epstein's vault, which erected its residence as Saudi Arabia? His lawyers said it was protection in case he was ever kidnapped in the Middle East. (Bloomberg)
Politics and Politics
• Acting Labor Secretary Patrick Pizzella has spent decades fighting against regulations and unions. (NYT)
• A federal appeal dismissed a legal challenge against a presidential candidate order that reduces the power of federal unions. (NEWS)
• The house approved a resolution that condemned President Trump's attack on four democratic congressional friends as racist. (NEW)
• The French finance minister, Bruno Le Maire, is planning to push the group of 7 countries for an agreement with a minimum tax rate. (FT)
• John Paul Stevens, the retired Supreme Court justice that long led its liberal wing, died yesterday. He was 99. (NEW)
• President Trump said his administration would "take a look" on Peter Thiel's claim that Google should be investigated to potentially help the Chinese military . ( Axios)
• The Ministry of Justice has supported Qualcomm's complaint of a perverse antitrust equalization against the company in a case of F.T.C. (FT)
• Hedge funds and asset managers develop algorithms to predict price changes for crypto rate changes based on data scraped from social networks. (Reuters)
Best of the rest • Billions of dollars in federal grants for opioid treatment and prevention programs are set to end next year. (NEW)
• British management consultants rely on the healthy business that Brexit has generated for them. (FT)
• Europe is struggling to find its way back from negative interest rates. (Bloomberg)
• Why a gigantic gold coin weighing a metric ton and worth about $ 45 million was on show at Wall Street this week. (WSJ)
Thank you for reading! We'll see you tomorrow.
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