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As shutdown drags on, few options in battle over border security

President Trump traveled to the southwestern border yesterday, where he reiterated the demand for a wall that has led to a bitter political impasse and a government shutdown now in its 21st day. He used the visit to blame the shutdown on Democrats and suggested that he might declare a national emergency to bypass Congress.

White House officials considered diverting emergency aid to build a border barrier. Among the options: moving $13.9 billion allocated last year after devastating hurricanes and wildfires.

Some Senate Republicans came off the sidelines to seek a deal that would reopen the government. But negotiations collapsed before they could gain momentum.

The fallout continues to spread:

• President Trump canceled a planned trip to the glittering economic conference held annually in Davos, Switzerland, citing what he called the Democrats’ “intransigence.”

• Farm country has stood by the president, but some farmers say the loss of crucial loans, payments and other services could change that.

• The leaders of unions representing air traffic controllers and aviation safety inspectors warned of potential risks to air travel.

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Today’s DealBook Briefing was written by Andrew Ross Sorkin and Stephen Grocer in New York, and Tiffany Hsu and Gregory Schmidt in Paris.

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Assessing Trump the manager

Donald J. Trump’s management style as a businessman — impetuous, impolitic, sometimes immature — worked when he ran his private company, writes the NYT business columnist James Stewart.

But now Mr. Trump is running a much larger enterprise, and the management traits that may have propelled him into the White House are not serving him well now that he’s there.

With the government shut down over Mr. Trump’s demand for border wall funding, the loss of a Republican majority in the House and scant legislative achievements beyond the 2017 tax cut, Mr. Stewart argues, his presidency is emerging as a case study in how not to govern.

Confronting #MeToo in economics

Sexual harassment, discrimination and bullying are rampant in economics, a field that regularly isolates and dissuades women and minorities and that has only recently begun to address its entrenched culture of exclusion, write Ben Casselman and Jim Tankersley of the NYT.

The issue arose often last weekend at the annual meeting of the American Economic Association in Atlanta, they report, where women from Ivy League schools told stories of wearing khakis and loafers to fit in with their male colleagues and new research was released showing that only 10 percent of tenured finance professors are women.

Ben Bernanke, the former Fed chairman and the group’s president, said at the event that “economics certainly has a problem” and “a reputation for hostility toward women and minorities.” Janet Yellen, who was the Fed’s first chairwoman and will head the association next year, said that dealing with misconduct and discrimination “should be the highest priority.”

Last month, the NYT wrote about harassment accusations against Roland G. Fryer Jr., a prominent Harvard economist, who had been expected join the association’s executive committee this month but was asked to resign.

A #MeToo lawsuit: The board of Google’s parent company, Alphabet, is being sued in California over the departure of Andy Rubin, a senior executive known as the “father of Android.” The shareholder lawsuit alleges that directors knew about an investigation into a sexual harassment claim against Mr. Rubin but nevertheless played an “active and direct role” in approving a $90 million severance package for him. The NYT reported in October that Google made the payout after a female employee accused Mr. Rubin of coercing her into performing oral sex.

China trade talks head for Washington

Negotiations between China and the U.S. are advancing, with China’s vice premier and economic chief, Liu He, heading to Washington on Jan. 30 and 31. He will meet with the U.S. trade representative, Robert Lighthizer, and the Treasury secretary, Steven Mnuchin, according to the WSJ.

The next-level gathering, unless it is stymied by the government shutdown, will continue three days of midlevel discussions in Beijing that wrapped up on Wednesday with a sense of progress but few specific resolutions.

This fight does have some winners: Tariffs on Chinese and American cars could bolster automakers in Japan. Restrictions on American soybeans could help farmers in Brazil and Canada.

But investors want resolution. The standoff has shaken global markets, and signs of optimism from negotiators lifted stocks this week. Today in Asia, the Hang Seng, Nikkei, Kospi and Shanghai Composite indexes all closed higher.

Espionage in China: A Chinese employee of Huawei and a Polish employee of the French telecommunications company Orange have been arrested in Poland, charged with spying for the Chinese government.

Patience is the Fed’s new watchword

Jerome Powell, the Federal Reserve chairman, said the central bank would evaluate the health of the economy before any further interest rate increases, using the word “patience” four times in his remarks. Financial markets have shown signs of anxiety about the economic outlook, but Mr. Powell said 2018 was “a very good year for the economy.” The Fed, he said, saw signs of continued momentum.

In other Fed news: Most private economists expect it to hold interest rates steady at least until June, according to a WSJ survey. Last summer, the Fed’s policy of quantitative tightening was expected to lift bond yields, but in the topsy-turvy world of Wall Street, the reaction has reversed in just a few months.

Earnings season is looking ugly

The forecast on Wall Street calls for plenty of pessimism, as a slew of companies slashed their financial predictions and announced cost-cutting measures yesterday:

• American Airlines said a measure of fourth-quarter revenue would gain just 1.5 percent, after previously promising as much as 3.5 percent. Delta, which will report its earnings on Tuesday, made a similar announcement earlier this month.

• Ford said it would cut thousands of jobs in Europe, as it faces declining demand and increasingly stringent emissions rules. Jaguar Land Rover said it was cutting 4,500 jobs because of “multiple geopolitical and regulatory disruptions.”

• BlackRock, which will report its earnings on Wednesday, will show 500 employees the door in the next few weeks. The world’s largest asset manager blamed “market uncertainty.”

• Macy’s suffered the biggest single-day sell-off in its history after scaling back its sales and earnings guidance.

• Holiday sales at Kohl’s were disappointing, rising 1.2 percent last year from the year before, compared with a nearly 7 percent boost in 2017. Barnes & Noble said it might slash its outlook by as much as 10 percent because of higher spending on advertising and promotions.

• Bed Bath & Beyond was one of the few bright spots, saying it was ahead of some of its financial goals.

Many more businesses are scheduled to report results next week, with JPMorgan Chase and Wells Fargo earnings coming on Tuesday, Goldman Sachs and Bank of America on Wednesday, and Netflix and Morgan Stanley on Thursday.

But how long will it take the market react to the secrets likely buried in the “dreary and repetitious” prose that makes earning reports so “mind-numbingly boring”? Months, probably, writes the NYT’s Jeff Sommer.

Revolving door

• Peter Weinberg, who helped found the financial services firm Perella Weinberg Partners in 2006, will reportedly become its chief executive as it prepares for a potential I.P.O. (Bloomberg)

• KKR, the investment firm, hired David Luboff from the Macquarie Group to head its Asia Pacific Infrastructure group. (Business Wire)

• Keisuke Sueyoshi, previously the head of mergers and acquisitions at Deutsche Bank in Tokyo, joined Goldman Sachs as managing director in its investment banking division. (Bloomberg)

• Gary Levine and Jana Winograde will become the presidents of entertainment at Showtime, reporting to David Nevins, the chief executive and chairman. (NYT)

• Yasuo Takeuchi, the vice president of the Japanese medical equipment and camera maker Olympus, will replace Hiroyuki Sasa as chief executive in April. The company was also forced by ValueAct, an activist hedge fund, to bring on three foreign directors. (FT)

The speed read

Deals

• A record number of companies faced activist campaigns like Third Point’s proxy fight with Campbell Soup last year: 226, up from 188 in 2017. Activist investors invested a record $65 billion into their efforts and won the most board seats ever. (FT)

• Heavy debt and competition led the owner of P.F. Chang’s China Bistro, the private equity firm Centerbridge Partners, to sell the restaurant chain to TriArtisan Capital Partners and Paulson & Co. (Bloomberg)

• The Brazilian government is letting Boeing move ahead with a deal that involves taking over 80 percent of Embraer’s commercial plane division for $4.2 billion. The government said yesterday that the companies will maintain their current work force in Brazil. (Reuters)

Tech

• The Indian government has unexpectedly proposed content-policing regulations. Activists and executives in tech and social media say it could be a gateway to censorship, and they’re preparing for a fight. (Reuters)

• The Chinese authorities are targeting people who post criticism of the government on Twitter, a platform blocked in the country, extending online censorship beyond China’s borders. (NYT)

Politics and policy

• Federal prosecutors are looking into Ukrainians who visited Washington during President Trump’s inauguration. Some are believed to have promoted deals that aligned with Russian interests. (NYT)

• Michael Cohen, the president’s former personal lawyer, agreed to testify before the House Oversight Committee next month. (NYT)

• The head of the U.S. Chamber of Commerce, the country’s largest business lobbying group, blasted the Trump administration’s policies on trade and immigration, saying that tariffs are “taxes paid by American families and American businesses, not by foreigners.” (FT)

• Prime Minister Shinzo Abe of Japan, gave Theresa May the country’s “full support” for her Brexit proposal, saying the “whole world” wanted to avoid a no-deal withdrawal. He was the first world leader to visit Britain and lobby for the beleaguered British leader’s transition plan. (FT)

Best of the rest

• The video game developer Activision Blizzard is ending its partnership with Bungie, the studio behind one of its biggest hits. (WSJ)

• Amazon started its first advertising-supported streaming video channel, IMDb Freedive. (WSJ)

• Adam Neumann, the chief executive of WeWork, said he was not concerned that SoftBank had invested less in the company than expected, because it had reached annualized revenue of $2.5 billion in the fourth quarter. (CNBC)

• Automakers worldwide are planning to spend $300 billion on electric vehicles over the next five to 10 years, according to an analysis. (Reuters)

• JPMorgan Chase is said to be planning to increase annual bonuses at its corporate and investment bank. (Reuters)

• Dairy Queen, owned by Warren Buffett’s Berkshire Hathaway, can pursue a lawsuit to stop W.B. Mason from selling “Blizzard” bottled water, a judge ruled. (Reuters)

• Jeffrey Vinik plans to resurrect Vinik Asset Management, the hedge fund he closed in 2013. (CNBC)

• Prosecutors in Japan made fresh accusations against Carlos Ghosn, the former Nissan chairman, setting up a legal battle that could keep him in custody for months. (NYT)

• The European Commission is investigating whether the Dutch government illegally allowed Nike to camouflage profits and save billions in taxes. (NYT)

• Ford’s ride-sharing service, Chariot, will cease operations by the end of March. (Reuters)

• Agenda, a news service owned by The Financial Times, interviewed someone claiming to be Leslie Moonves shortly after he was fired as chief executive of CBS. Representatives of Mr. Moonves say it wasn’t him. (NYT)

Thanks for reading! We’ll see you on Monday.

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