Good morning. Andrew here. Yesterday we told you about the backlash against the venture capitalist Shaun Maguire over his calling Zohran Mamdani an “Islamist.” Hundreds of people signed a petition demanding that his firm, Sequoia, censure him. Now a new letter is making the rounds with signatories supporting Maguire. “The calls to punish or remove him are part of a larger and worrying trend: ideological mobbing disguised as a moral virtue,” the letter reads. Clearly, the debate is not over, and we will be watching to see what happens next. We’re also keeping a close eye on the latest trade fight, including a steep tariff on copper that threatens to further rattle U.S. companies. And Lauren Hirsch reports on what’s on New York business leaders’ minds before their meetings with Mamdani next week. (Was this newsletter forwarded to you? Sign up here.)
Copper climbingThe latest phase of President Trump’s trade war has had little fallout on global stock markets so far this week. But it’s beginning to affect other areas, including commodities — take a look at copper in particular — and government bonds. The latest:
The copper threat is a big one for American businesses, which use the metal in components for homes, cars, high-tech devices and the power grid as well as data centers. Copper futures hit a record in New York yesterday as traders anticipated a Trump move.
The metal’s geopolitics have been a major market focus. Desperate to shore up supplies of the metal, the Biden administration and the European Union funneled nearly $1 billion, beginning in 2022, into a massive infrastructure project in copper-rich Africa, where China has a huge presence. Closer to home, spikes in copper prices often lead to increased crime as scrap-metal thieves raid streetlights, train yards and plumbing lines to capitalize on demand. Economists are trying to determine the inflationary effects. Before Trump issued his threats on copper and pharmaceuticals, Goldman Sachs economists concluded that U.S. consumers and businesses would each pay about 40 percent of tariff costs, and foreign exporters the rest. Are bond vigilantes getting restive? The yield on the 10-year Treasury note, which underpins lending rates for businesses and homeowners, rose today for a sixth straight session, to 4.4 percent. (Remember that a sell-off in Treasury notes and bonds in April helped force the White House to pause its tariff threats.) Trump now seems determined to stick with his hard-line tactics to advance framework deals, with India and the European Union appearing to be next in line. But full-fledged trade deals often take months of negotiations; that’s why Treasury Secretary Scott Bessent and others tried to persuade Trump to give them more time for talks, The Wall Street Journal reports.
The Supreme Court clears a path for mass firings of federal workers. Justices lifted a lower court’s ruling that had blocked the Trump administration’s plan to lay off potentially tens of thousands of government workers. While technically temporary, the Supreme Court’s move effectively allows the administration to reorganize the federal bureaucracy without input from Congress. Meta is said to invest about $3.5 billion in the maker of Ray-Bans. Meta, the parent company of Facebook and Instagram, acquired a roughly 3 percent stake in EssilorLuxottica, which makes smart glasses for the tech giant, according to Bloomberg. The investment signals Meta’s ongoing interest in A.I.-enabled wearables; shares in Warby Parker, a rival glasses maker, rose on the report as investors speculated that it might secure its own investment from its tech partner, Google. Apple’s No. 2 executive plans to retire. Jeff Williams, a longtime lieutenant to Tim Cook, will step down as the chief operating officer after a 27-year career there. Williams had been considered a potential C.E.O.; his departure raises questions about who might succeed Cook. Candidates include John Ternus, Apple’s head of hardware engineering; Craig Federighi, its head of software; and Eddy Cue, its head of services. Wall Street prepares to grill MamdaniThere’s one topic that Wall Street has talked about incessantly over the past several weeks: Zohran Mamdani, who won New York City’s Democratic primary for mayor last month. His unexpected ascent has set off furious speculation among executives who want to know what he might do if he wins in November. They may soon have fresh insight: Mamdani is set to meet with the Partnership for New York City next week, offering many of the city’s top business leaders their first chance to grill the mayoral candidate, Lauren Hirsch reports. The group consists of some of Manhattan’s most influential executives. It is chaired by Albert Bourla of Pfizer and Rob Speyer of Tishman and Speyer. Others on its board include Jeff Blau of Related, Jane Fraser of Citigroup, Henry Kravis of KKR and David Solomon of Goldman Sachs. The day after Mamdani’s win, the partnership held a video call dissecting the victory. The liveliness of the meeting caught many of its executives by surprise. Among the dominant topics: Was there any effective way to support a rival candidate? How much could fund-raising for another candidate do, given the unprecedented sums that Andrew Cuomo raised, only to lose the primary? Did they feel comfortable backing Mayor Eric Adams, given that he had faced five federal counts of corruption, which were eventually dropped? In one of the snappier moments someone on the call let the executives know that their kids probably voted for Mamdani. (Probably some of their employees did, too.) Next week’s meetings will run for two days. Mamdani will address C.E.O.s on July 15 to speak generally and on July 16 to discuss the tech sector. He reached out to the Partnership for New York City after he won the primary, the group’s C.E.O., Kathryn Wylde, told DealBook. Wylde and Mandami discussed setting up meetings, and he asked which executives he should reach out to, she added. Wall Street has a lot on its mind. On the list: details behind his top-line policy proposals, including higher taxes on corporations and the wealthy; whether he believes billionaires should exist; if he would keep Jessica Tisch on as police commissioner; and his position on Israel. Meanwhile, any hope that financial moguls had of averting a split ticket seems to be fading: Adams told CNBC that he had rebuffed a request by Cuomo to step aside; instead, Adams called for Cuomo to drop out. Cuomo hasn’t publicly indicated he plans to do so. What, Musk worry?Shares in Tesla have recovered slightly from their sharp drop after Elon Musk announced his intent to form a new political party, drawing the anger of President Trump. Many shareholders and analysts may still be worried that the tech billionaire’s plan could lead to political retribution against his business empire. But Musk — and some investors — appear undaunted. “Shut up, Dan” was Musk’s response to the tech analyst Dan Ives, who had again called on Tesla’s board to force Musk to drop his political efforts. Whether the carmaker’s directors, who have long been criticized for being too deferential to Musk, would heed Ives’s call is worth watching. It’s not clear how serious Musk is about forming a new party or whether any such organization would do more than field a handful of candidates for the House and the Senate. But Musk appears willing to keep lashing out at Trump. Musk’s current focus is the Justice Department’s assertion that the convicted sex offender Jeffrey Epstein died by suicide and didn’t have a “client list.” Trump exasperatedly urged people to move on from the topic, but Musk is among those who hasn’t. Musk’s needling of Trump comes despite worries that the president might use his administration to punish Tesla, SpaceX and other Musk-run businesses, many of which depend on favorable regulation and government contracts. Some investors don’t seem worried. The latest sign is that SpaceX, the rocket and satellite company, is debating whether to raise money at a $400 billion valuation — up 14 percent from where it was valued in December — according to Bloomberg. Interest in any such round would indicate a belief that investors aren’t worried about SpaceX’s fortunes.
“The Apprentice,” Fed editionPresident Trump kept up his attacks on Jay Powell at a Cabinet meeting yesterday, calling him “terrible” as the Fed chair: “We should get somebody in there that’s going to lower interest rates,” he said. Powell’s term as chair doesn’t end until May (though he can stay on as a governor until January 2028.) But Fed watchers continue to speculate about a pair The Wall Street Journal calls the “two Kevins” — Kevin Hassett, a top Trump economic adviser, and Kevin Warsh, a former Fed governor — who are jockeying to become the central bank’s leader. The succession drama is hanging over the Fed and markets. Trump has made clear that he doesn’t care much about preserving the central bank’s perceived political independence as he seeks someone who would lower borrowing costs. (On that note, the release today of minutes from last month’s Fed meeting could reflect where its policymakers stand on rates.) The candidacies of Hassett and Warsh have taken on the feel of a game-show competition, The Journal reports: Hassett met with Trump about the Fed job at least twice in June, according to people familiar with the matter. The discussions marked a shift for Hassett, who previously had told allies he wasn’t interested, but now says he would take the job if offered. Warsh has discussed traveling to Washington this month to meet with Treasury Secretary Scott Bessent about the Fed position, according to people familiar with the matter. Who has the edge? Hassett is a longtime Trump aide and has become a vocal critic of Powell’s hold-steady approach to rate cuts. But he’s seen as less telegenic, which appears to matter to the president. Warsh is well respected by Wall Street, was a college classmate of Trump’s and interviewed last fall for role of Treasury secretary. But he’s viewed as more hawkish on rates, potentially putting him at odds with the president. We hope you’ve enjoyed this newsletter, which is made possible through subscriber support. Subscribe to The New York Times.
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Correction: Yesterday’s newsletter misstated the timing of a video by Shaun Maguire in response to criticism of his post about Zohran Mamdani. It was published before the petition condemning his remarks went online. Also, it misstated which signatories Sequoia had invested in. It had backed one; others had received investment from entities that have since been spun off from the firm. Also, the newsletter misstated Robinhood’s plans for tokens tied to OpenAI and SpaceX. The company plans to offer them to European investors as part of a limited giveaway, not to sell them. Thanks for reading! We’ll see you tomorrow. We’d like your feedback. Please email thoughts and suggestions to dealbook@nytimes.com. |
