Thursday's economy & business stories

Bloomberg drives record Democratic primary debate ratings

Photo by Mario Tama/Getty Images

Mike Bloomberg's first debate appearance drove ratings to a record-high Wednesday night, according to Nielsen ratings provided by NBC News. The debate averaged nearly 20 million live TV viewers across NBC, MSNBC and Telemundo, according to preliminary numbers.

Why it matters: Bloomberg's highly anticipated debate debut drew contentious zingers from opponents who were eager to spar with him on stage for the first time.

Why the Boy Scouts of America filed for bankruptcy

Victims' rights Attorney Jeff Anderson speaks to media during a press conference on April 23, 2019. Photo: Eduardo Munoz Alvarez/AFP via Getty Images

The Boy Scouts of America filed for bankruptcy protection this week with the sole purpose of relieving the legal pressure it faces from sexual abuse victims.

Why it matters: Bankruptcy means that a judge will put a ceiling on how much BSA will pay to victims. The proceedings could limit the degree to which local councils' billions of dollars' worth of assets can be awarded to victims.

Trump indulges Wall Street with Milken pardon

Photo Illustration: Sarah Grillo/Axios. Photo: Chris Graythen/Getty Images

Donald Trump loves Wall Street shenanigans. Companies owned by him have declared bankruptcy six different times, and he was once sued alongside Mike Milken for participating in a scheme to artificially inflate junk-bond prices.

Driving the news: Trump pardoned Milken this week, with an official statement positively gushing over Milken's role in developing the wilder side of fixed-income capital markets.

Morgan Stanley to buy E*Trade in a $13 billion deal

Photo: Rafael Henrique/SOPA Images/LightRocket via Getty Images

Morgan Stanley is buying E*Trade Financial, the company known for helping everyday Americans manage their money, in a $13 billion all-stock deal, the investment bank said Thursday.

Why it matters: The deal signals Morgan Stanley's desire to bulk up in wealth management, a strong profit arm of its business model. As the WSJ notes, Wall Street banks have been looking for steadier sources of revenue, now that "postcrisis regulations and a long period of eerie calm in the markets" have taken a toll on profits.

Go deeperArrowUpdated Feb 20, 2020 - Economy & Business

Podcast: Bloomberg’s social media strategy

The Wall Street Journal reported that Mike Bloomberg’s campaign is hiring people to regularly post from their personal social-media accounts and send texts in support of Bloomberg to their contacts. Pro Rata producer Naomi Shavin is joined by Axios media reporter Sara Fischer to discuss the campaign’s social media strategies and how platforms are responding.

Go deeper: Read the Wall Street Journal report

Established VCs turn to "super angels" to grow their network

Illustration: Eniola Odetunde/Axios

Thanks to companies like AngelList and Carta that make it easier than ever to set up small VC funds, a new generation of so-called “super angels” is cropping up — and established venture funds are backing them.

Why it matters: Just like the boom in scout programs a number of years ago, it’s all about the deal flow.

WSJ: Leslie Wexner to step down as Victoria's Secret goes private

Photo: Keith Mayhew/SOPA Images/LightRocket via Getty Images

L Brands is reportedly near a deal to sell a 55% stake in Victoria’s Secret to Sycamore Partners, which will take the women’s lingerie company private and value it at about $1.1 billion, per the Wall Street Journal.

Details: L Brands will keep the remaining stake in a separate company along with sister brand Pink, while the core company will now only operate Bath & Body Works. Leslie Wexner will step down as CEO and chairman but remain on the boards of both companies.

Gold rising with stocks, yen falling with bond yields

Data; FactSet; Chart: Axios Visuals

Markets are behaving strangely as investors attempt to make sense of the growing threat of the novel coronavirus. Assets that typically move in opposite directions are moving together, and assets that traditionally are very correlated are taking inverse tracks.

State of play: The market's two most popular safe-haven assets, gold and the Japanese yen, have decoupled and are moving in opposite directions.

Coronavirus outbreak slams companies' 2020 sales projections

A man and a child walk past a closed Apple store in Shanghai on Feb. 20. Photo: Yifan Ding/Getty Images

The coronavirus outbreak already is eating into companies' 2020 plans, with a number of firms announcing significant expected hits to their sales.

What's happening: After warning that it would need to write down its revenue expectations, a new report from Nikkei says Apple's iPhone inventories could remain low until April or longer and that suppliers are "currently operating at around 30% to 50% of capacity."

The Fed may be setting the table for 2020 rate cuts

Illustration: Sarah Grillo/Axios

The Fed looks to be laying the groundwork to lower U.S. interest rates this year, just as they did in April 2019 before cutting rates in July, September and October.

Why it matters: A Fed rate cut makes taking on debt more attractive for U.S. consumers and businesses, helping to juice the economy, but also puts the central bank in a weaker position to fight off a potential recession.

UnitedHealth terminates handful of Mednax contracts

Photo: Marijan Murat/picture alliance via Getty Images

UnitedHealth Group will be ending contracts with Mednax anesthesiologists, neonatologists and obstetricians in four states this year, affecting $70 million of revenue, Mednax said Thursday. Mednax and UnitedHealth did not immediately respond to questions.

Why it matters: If the two sides don't strike a new deal, Mednax doctors will be out-of-network for all people who have UnitedHealth insurance, regardless if those doctors work at in-network hospitals — putting patients at risk of receiving surprise medical bills from those Mednax doctors. Congress has not resolved surprise billing.

More firms throw weight behind new Wall-Street backed stock exchange

Photo: Carl Court/Getty Images

Goldman Sachs and JPMorgan are joining the list of banks, brokerages and trading firms that back the Members Exchange, or "MEMX" — a new stock exchange that says it will go live in July and challenge incumbent exchanges by charging lower fees.

Why it matters: MEMX, which is still awaiting regulatory approval from the SEC, could be a formidable competitor to the entrenched "big three" stock exchanges.