Good Wednesday morning. What’s next for the Wynn empire now its founder has gone? The markets’ wild ride isn’t over yet. And the behind-the-scenes fighting at Airbnb. Corner Office is back: David Gelles will interview Ken Frazier of Merck, Katrina Lake of Stitch Fix and Marc Benioff of Salesforce for the column. Send him your questions.
Steve Wynn has stepped down from his $17 billion casino empire, a little over a week after allegations of forced sex and other sexual misconduct claims emerged in a WSJ investigation.
There had been little sense at Wynn Resorts over the last week that the man who made modern Las Vegas was on his way out:
He also attended the company’s 1,500-guest Super Bowl party on Sunday, the WSJ says.
In a statement, Mr. Wynn blamed his exit on “a rush to judgment” that took “precedence over everything, including the facts.”
The intrigue: The company’s news release reads almost like a corporate eulogy, calling Mr. Wynn a “beloved leader and visionary.” So why the sudden exit? (Our colleague Peter Eavis will weigh in on DealBook this morning.)
The big questions
• Do other S. & P. 500 C.E.O.s now have something to fear?
• And is the Wynn empire — from Las Vegas to Macau to, soon, Massachusetts — now ripe for a takeover or breakup?
• “While there are plenty of jobs for women as waitresses and croupiers, far too few rise to the levels at which they have the power to make a change,” David Fickling writes. (Gadfly)
• “It’s easy for a company in turmoil, especially one so closely associated with a celebrity founder that has effectively been forced out, to become prey,” Jeff Goldfarb writes. (Breakingviews)
Today’s DealBook Briefing was written by Andrew Ross Sorkin in New York, and Michael J. de la Merced and Amie Tsang in London.
Yesterday’s headline: “Wall Street Halts a Global Rout.”
Today’s: “Dow Is Headed for a 300-Point Drop at the Open.”
The bigger picture
Welcome to the end of easy money, as strengthening economies lead to higher wages and tighter unemployment — and potentially to central bankers raising interest rates.
President Trump’s tax cut was meant to supercharge growth in an economy already doing fine. (Though Eduardo Porter notes that productivity is low and new business formation has slowed.) Economists and analysts are increasingly worried that the tax overhaul will do the opposite of what it was intended to.
Blame the VIX/machines/debt
• Analysts took a closer look at the “inverse VIX” trade — bets on a continued fall in the popular Wall Street volatility index that went very sour on Monday and forced a lot of selling.
• Steven Mnuchin suggested yesterday that algorithms might be behind the whipsawing: “I have heard from others that it has played a role, as there’s more programmed trading, this tends to have volatility in both directions.”
• Carl Icahn said exotic investment funds and lots of leverage had made the markets a “casino on steroids.”
Think about the deals: A Turkish franchisee of Burger King restaurants postponed its market debut yesterday, while deal makers worry that a steady stream of big mergers will dry up.
• Mr. Trump called for a government shutdown if Congress did not address illegal immigration, even as lawmakers work on a two-year budget deal. John Kelly, his chief of staff, derided Dreamers who did not register for protected status.
• The White House says it will explain the “principles” of its infrastructure plan on Monday. (CNBC)
• The U.S. had a record trade deficit with China last year, potentially encouraging a tougher line from the Trump administration. (NYT)
• Mr. Trump wants the Pentagon to hold a big — and rare — military parade in Washington this year. (WaPo)
On one side: Brian Chesky, the home rental giant’s co-founder and C.E.O., who wants it kept private a while yet.
On the other, supporting an I.P.O. this year, according to Bloomberg’s unnamed sources: the C.F.O. Laurence “L.T.” Tosi and the Airbnb investors General Atlantic, Glade Brook Capital, TCV and TPG.
More from Olivia Zaleski:
Ultimately, Mr. Tosi — who didn’t see eye to eye with Mr. Chesky on other issues and generally did not fit in at Airbnb — resigned.
An Airbnb spokesman denied there was ever any intent to pursue an I.P.O. this year.
Bonus trivia: Mr. Tosi set up a hedge fund of sorts at Airbnb, which was responsible for 30 percent of Airbnb’s cash flow last year and made about $60 million.
The tech flyaround
• Goldman Sachs’s retail arm is in talks to offer financing for Apple customers, unnamed sources say. (WSJ)
• Snap bolstered revenue and user growth in the fourth quarter, and investors rejoiced. (NYT)
• At the Uber-Waymo trial, Travis Kalanick kept calm and talked about his “jam sesh” with the autonomous-driving engineer at the center of the dispute. (NYT)
• Senators criticized Uber for how it handled a 2016 data breach. Meanwhile, the company is hoping to offer air taxis by 2025, through a deal with Bell Helicopter, and is giving its U.S. riders exclusive Winter Olympics content.
• A pollster hired by Facebook to track public sentiment about Mark Zuckerberg said he left after coming to believe the company wasn’t good for society. (The Verge)
• European regulators are closely examining Apple’s bid for the music app Shazam. And Apple might give rebates to users who bought iPhone battery replacements before it discounted them.
He could join Jeff Bezos, Sheldon Adelson and Warren Buffett if his bid to buy the L.A. Times and the San Diego Union-Tribune from Tronc for about $500 million goes through.
LAT staff have chafed at the decisions of Tronc and its chairman, Michael Ferro. More from Sydney Ember of the NYT:
The deals flyaround
• SoftBank said it had spent $40 billion from its roughly $106 billion Vision Fund and Delta Fund, and that it plans to spin out its Japanese mobile unit.
• Google is expanding its New York headquarters, agreeing to buy the building across the street — which is home to Chelsea Market — for more than $2 billion. (Real Deal)
• An activist investor, Blackwells Capital, urged the supermarket chain Supervalu to break itself up, and plans a proxy fight. (WSJ)
The S.E.C. and the Commodity Futures Trading Commission told senators that Congress should consider expanding federal oversight of cryptocurrency trading.
And Agustin Carstens, the head of the Bank for International Settlements, said central banks must be prepared to intervene, calling digital currencies a “combination of a bubble, a Ponzi scheme and an environmental disaster.”
Mr. Carstens also argued that cryptocurrencies were freeloading on existing financial infrastructure and the legitimacy that came from being linked to it.
On a positive note, while Bitcoin is at about $8,000 this morning, things could get far worse, according to Goldman Sachs:
• Slack named a longtime executive, Allen Shin, as its C.F.O., another step on the road to a listing. (Slack)
• AIG has hired Caroline Krass, a partner at Gibson, Dunn & Crutcher and a former general counsel of the C.I.A., as deputy general counsel. (AIG)
— Elon Musk, after SpaceX successfully launched its Falcon Heavy rocket (carrying a cherry red Tesla roadster) from Cape Canaveral, Fla. yesterday. David Bowie’s “Life on Mars” played at the end of the webcast.
• A livery driver who had written about being a casualty of the gig economy killed himself outside City Hall in Lower Manhattan on Monday. (NYT)
• Business Wire, the corporate news-release distributor owned by Berkshire Hathaway, is dealing with a cyberattack. It has caused outages for nearly a week. (WSJ)
• Morgan Stanley gave the cold shoulder to Derek Jeter, co-owner of the Miami Marlins, and his banker, Greg Fleming, when asked if large brokerage clients would like to buy a piece of the team, unnamed sources said. (Fox Business)
• FEMA awarded an Atlanta entrepreneur, Tiffany Brown, $156 million to supply 30 million meals to Puerto Ricans after Hurricane Maria. Only 50,000 have been delivered. (NYT)
• The German carmaker Daimler publicly apologized on Tuesday after its Mercedes-Benz brand caused an outcry in China by quoting the Dalai Lama in a social media post. (NYT)
• Can Christian Louboutin trademark red soles? The European Union’s highest court says no. (NYT)
• PepsiCo will not be making Lady Doritos. (NYT)
• One of the issues that contributed to Laurent Potdevin’s departure as C.E.O. of Lululemon, unnamed sources say, was a multiyear relationship with a female designer. (CNBC)
• Quentin Tarantino, accused by Uma Thurman of putting her life at risk by making her perform a dangerous stunt for the “Kill Bill” films, described it as one of the biggest regrets of his life. He disputed some details of her account. (NYT)
• The supermarket Tesco is facing Britain’s largest ever collective equal pay claim, for a potential total of about $5.6 billion. (BBC)
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