The Week in Business: Boeing’s Big Mess and Brexit’s Next Steps
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You’re a busy person, so here’s your quick and breezy catch-up on the latest in tech and business news, plus what to know for the week ahead. Your Monday self will be better for it.
A Bumpy Descent
Boeing’s brand-new fleet of 737 Max aircraft was grounded in over 40 countries after a deadly plane crash in Ethiopia last Sunday, the second 737 Max to go down in five months. There’s no hard evidence that the planes have anything wrong with them, but similarities between the two crashes caused widespread concern among aviation officials (and passengers) around the world. Boeing has promised a software fix and new training program for pilots by April, but it may take a lot longer to repair the damage to its reputation and its bottom line, considering the 737 Max was its best-selling jet ever.
Humans were forced to have actual conversations when Facebook, Instagram and WhatsApp went dark for few hours on Wednesday. (The platforms, all owned by Facebook, were apparently suffering from a server issue.) But the company may not bounce back quite so fast when federal prosecutors start examining its business deals. Officials are conducting a criminal investigation into partnerships that Facebook struck with other big tech companies, namely, agreements that involved handing over its users’ personal information without their consent. Other signs of turmoil: Two of Facebook’s top executives resigned on Thursday without giving explicit reasons.
A Blow to the Gun Industry
Firearm makers took a hit on Thursday when a Connecticut court ruled that the families of victims in the 2012 shooting at Sandy Hook Elementary School could proceed with suing Remington, which made the AR-15 rifle used in the massacre. The decision conflicts with Congress’s previous policy of shielding gun manufacturers whose weapons are used in a crime, and creates a potential opening to hold those companies liable. At the center of the lawsuit is Remington’s promotional messaging, which the families argue shows an effort to appeal to troubled young men. An outcome in the plaintiffs’ favor could have far-reaching effects on how guns are marketed and sold.
The Long Goodbye
We were so looking forward to March 29 as the last day of Brexit negotiations (and hearing people talk about them). But alas. British lawmakers voted on Thursday to push back the country’s departure from the European Union until they can agree on how to actually pull it off, so the squabbling will drag on for … well, who knows. Prime Minister Theresa May will meet with European Union leaders in Brussels this Thursday to discuss the terms of the postponement, which will require approval from all 27 members of the bloc to proceed.
Expect more stump speeches about breaking up big tech companies like Amazon, Google and Facebook after Senator Elizabeth Warren discussed her plan to do so at the annual South by Southwest Interactive conference in Austin, Tex., last week. Senator Warren, who is also a 2020 presidential candidate, argues that tech giants have abused their power by acquiring potential competitors, making it harder for smaller start-ups to compete, and wants to appoint regulators to divide the conglomerates. Almost everyone can agree that these corporations need clearer rules, but how to go about it will be a major topic as the 2020 presidential race heats up.
No Sudden Moves
Federal Reserve officials will meet this Tuesday and Wednesday to decide whether to raise the benchmark interest rate, but it would be a huge surprise if they did. The number (currently 2.25 to 2.5 percent) is the baseline for banks and other lenders to set interest rates on loans (like your mortgage), and the Fed recently took a much more hands-off approach to it. This new stance delighted Wall Street, but has also been interpreted as a bellwether of growing economic uncertainty.
The college admissions scandal that you’ve been following so breathlessly isn’t just taking down celebrity parents. Big names in the finance world are accused of paying bribes to get their children into top schools, too. (But are you really surprised?) In other news, Uber’s self-driving cars may soon get a $1 billion cash infusion from SoftBank, if their current talks go well. The company also just settled a lawsuit with drivers who wanted to be recognized as employees. The drivers got $20 million, but not the title: they’re still designated independent contractors.