6 The EconomistJuly 27th 2019
The world this week Business
America’sJusticeDepartment
announceda broadantitrust
reviewofthemarketpowerof
onlineplatformsinsearch,
socialmediaandretailing.
Thatincreasesthepressureon
Amazon,Apple,Facebookand
Googletoimprovetheirbehav-
iourasthecallsfromsome
Democratstobreakupthose
companiesgrowlouderduring
theelectionseason.Meanwhile,theFederalTrade
Commissionconfirmedthatit
isslappingFacebookwitha
$5bnfineforviolatingprivacy.
It orderedFacebooktochange
itsattitudetoprivacy“fromthe
corporateboard-leveldown”,
andintroducemechanisms
thatmakeitsexecutives
accountablefordecisionson
privacy.Thefirmdisclosedthat
theftchaslauncheda
separateantitrustinvestiga-
tionintoitspractices.Boeing’squarterlynetlossof
$2.9bnwasitsbiggestever.The
aerospacecompanyrecently
disclosedanafter-taxchargeof
$4.9bninconnectionwiththe
worldwidegroundingofits 737
maxairlinerfollowingtwo
fatalcrashes.Clash of the titans
Carl Icahn, an activist investor,
stepped up his attack on
Occidental’soffer to take over
a rival oil company, Anadarko,
calling it a “travesty”. Mr Icahn
holds a 4.4% stake in Occiden-
tal and has nominated a slate
of directors to sit on the com-
pany’s board. He has been
highly critical of Warren Buf-
fett’s backing of Occidental’s
bid, which includes putting
$10bn towards its financing.Soon after ditching an ipoof its
Asian business, which would
have been the world’s most
valuable stockmarket flotation
this year, Anheuser-Busch
InBev agreed to sell its Austra-
lian brewing division to Asahi,
a Japanese beermaker, for
$11.3bn. The world’s biggest
brewer still intends eventually
to list its Asian assets. It needs
the money to pay down the
huge debt pile it amassed
during a takeover binge.Theimflowereditsforecastof
global growththis year, to
3.2%, which would be the
weakest in a decade. In its
latest outlook the fund
described the world economy
as “subdued”; it is specifically
concerned about trade and
technology tensions between
America and China and the
prospect of Britain leaving the
euwithout a deal. Still, the imf
expects British gdpto grow by
1.3% this year, slightly above its
previous projection in April. It
sharply downgraded its growth
forecasts for many emerging
economies, notably Brazil,
Mexico and South Africa.South Africa’s finance minister
laid out plans to provide
Eskom, which generates most
of the country’s electricity,
with another rescue, this time
worth 59bn rand ($4.2bn).
Moody’s, a credit-rating agen-
cy, said that because the
embattled utility is ever moredependent on bail-outs it
would regard Eskom’s debt as
part of the government’s.The Federal Reservetook the
unusual step of qualifying the
remarks of a senior official to
reassure markets that they had
notbeen made in relation to
thecentral bank’s forthcoming
decision on interest rates.
Speculation that the Fed might
cutits benchmark rate by half a
percentage point, rather than a
quarter, mounted after John
Williams, who heads the
Federal Reserve Bank of New
York, said that he supports
aggressive easing. Donald
Trump, a critic of the Fed’s
recent monetary tightening,
seized on the remarks, saying
they underlined its “faulty
thought process”.Costs related to the overhaul of
its business pushed Deutsche
Bankto a €3.2bn ($3.5bn) net
loss in the second quarter, its
biggest quarterly loss in four
years. The German bank
booked about half of a restruc-
turing charge it will take as it
retreats from trading and
slashes 18,000 jobs over the
next three years.Nissanconfirmed it would cut
12,500 jobs worldwide, or 10%
of its workforce, by 2022, as it
curtails capacity. The Japanesecarmaker has struggled in
recent years. Profit in the latest
quarter fell by 95% compared
with the same three months
last year, to ¥6.4bn ($58m).General Motors delayed the
large-scale roll-out of its
autonomous-car ride-hailing
service, which it has developed
in collaboration with Cruise,
its self-driving-car unit. It had
hoped to deploy a fleet of
robotaxison the roads of San
Francisco by the end of this
year, but the launch has been
delayed indefinitely. gm, like
its competitors, is still dealing
with technical obstacles and
unresolved regulatory
questions.Muscle cars
In the week when Tesla
dismayed investors with
another disappointing quarter-
ly earnings report, Ford
unveiled an electric-powered
prototype of its f-150 pickup
truck in response to a claim by
Elon Musk that Tesla’s rival
model would have better
“functionality”. Ford’s f-series
pickups are the best-selling
cars in America. In a show of
strength, its prototype pulled a
freight train for 1,000 feet, a
direct challenge to Mr Musk’s
boast about the better perfor-
mance of his new vehicle.GDP forecastsSource:IMF2019, % increase on a year earlier
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