“We are a tech company, not a media company” — Mark Zuckerberg, when asked whether Facebook intends to become a news editor. On an unrelated note, Zuckerberg met with the Pope yesterday and gave him a drone as a gift (coincidentally on the same day new drone rules took effect). Just another day in the life of the Zuck.
- U.S. markets finished positive to kick off the week, ending a three-day negative streak despite global markets falling
- Shares of Caesars Entertainment plummeted 16% as the casino faces a huge battle against creditors who claim the company had debt obligations to one of its bankrupt subsidiaries
- After collapsing earlier this year after the DOJ ended the use of private prisons, Corrections Corp. of America fell another 4% yesterday after the Department of Homeland Security said it would look further into its private prison system
…And gives it away at half-price. Good enough? The pharmaceutical company came under heavy fire for raising the price of its EpiPen allergy device by over 500% since 2009…for no apparent reason other than that it could (oh the joy of monopolies). After a somewhat half-hearted attempt to save face last week, Mylan announced yesterday that it would begin selling a generic (i.e. identical) version of the EpiPen—but for $300, or half what its branded EpiPen sells for. So yes, Mylan will be competing with itself. And yes, it will certainly cut into the over $1 billion Mylan makes yearly from selling EpiPens, although the move may cost less in the long run than the public outcry. But will the move end the outrage over Mylan’s pricing tactics? We’ll see.
An Apple A Year
…Typical. In keeping with its annual tradition of launching a new iPhone during the second week of September, Apple’s famously cryptic invite to its release event has all signs pointing to a big camera update this go-around. Pretty standard stuff, right? There’s a bit more: rumors in the tech world indicate that the new iPhone—likely to be creatively dubbed the iPhone 7—will ditch the standard headphone jack in favor of a wireless option. Ouch. If this hits you deep in the feels too, then at least you aren’t the company responsible for such a cruel deed. Apple just got hit with its largest ever tax penalty by the EU, citing estimated back taxes from just under $1 billion all the way to $19 billion.
Things Turned Sour
…Between Hershey and Mondelez. Mondelez (the maker of Oreos) had its heart set on acquiring Hershey for quite some time. The outlook on the deal? Not so promising. Despite upping its initial bid to a whopping $23 billion last week, Hershey’s stuck with its “not happening,” causing Mondelez to finally abandon its pursuit of the candy company yesterday. Investors didn’t seem to be thrilled at Hershey’s rejection of Mondelez, with Hershey shares down more than 11% after hours. If it’s not meant to be, it’s not meant to be.
Prime Time for Walgreens
…As the pharmacy chain brings the competition to CVS. Partnering with Prime Therapeutics (nothing to do with Amazon Prime) will not only speed up Walgreens’ prescription fillings, but make its whole process run more smoothly. Essentially, Prime acts as a middleman between insurance companies and drugstores—negotiating things like medication prices—a major key for pharmacies. It doesn’t end with Prime, though: Walgreens also partnered with UnitedHealth Group this past March and is looking to buy Rite Aid very soon. Where you at, CVS?
- Chipotle is giving free drinks to students for a month
- Verizon’s ‘LTE Advanced’ network launches, promises 50% higher speeds
- Alphabet executive steps down from Uber board amid growing competition
- Martin Shkreli sells remaining stock in former company KaloBios
- Monday: Personal Income and Outlays (+/-)
- Tuesday: H&R Block, Abercrombie & Fitch Earnings; Consumer Confidence; S&P Case-Shiller Home Price Index
- Wednesday: Salesforce, Box Earnings; Private Employment Report; Pending Home Sales Index
- Thursday: Broadcom, Campbell Soup, Lululemon, Smith & Wesson Earnings; Weekly Jobless Claims; ISM Manufacturing Index; Construction Spending; PMI Manufacturing Index; Productivity Growth
- Friday: August Jobs Report; International Trade; Factory Orders
SCHOOLS…NOT DOING SO GREAT
Back-to-school season is in full swing, and we know the kids are gonna be alright…but what about the schools they’re heading back to? Turns out they mightnot be alright after all—on average, schools have less funding and fewer teachers than in years past. Here’s more:
- Flashback to eight years ago: in May 2008, U.S. school departments employed 8.4 million teachers and other workers. Now? We’re looking at closer to 8.2 million.
- Doesn’t sound so bad? Well, that isn’t even taking into account the one million student increase in public school enrollment since then.
- Consequently, student-teacher ratios are at the highest they’ve been since the late 1990s—which, by the way, is not a good thing.
- So how does this translate to dollars? State public education funding was down by 6.6% between 2008 and 2014. The federal government tried to compensate with an increase in funding, but it wasn’t quite enough to balance out a net 2.4% decrease in funding per student.
- The plus side? This decline in funding seems to have hit rock bottom, with most states restoring some funding in recent years. Things can only get better, right?
INTERVIEW QUESTION OF THE DAY
A string is wound symmetrically around a circular rod. The string goes exactly four times around the rod. The circumference of the rod is four cm and its length is 12 cm. What’s the length of the string? (Answer)
BUSINESS TERM OF THE DAY
Capitated Contract — A healthcare plan that allows payment of a flat fee for each patient it covers. Under a capitation, an HMO or managed care organization pays a fixed amount of money for its members to the health care provider. Just so you don’t get mixed up, a capitation contract is also referred to as a capitation agreement or a managed care capitated contract.
FOOD FOR THOUGHT
The Atlanta Falcons have closed financing on their new $1.5 billion stadium a year, and they did it a year earlier than executives originally projected. The breakdown: $200 million in public money, $200 million from the NFL and $1.1 billion from owner Arthur Blank and his partners.
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