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THE HEADLINES

 

IT’S OFFICIAL

The Department of Justice finally, formally approved the $26B merger between T-Mobile and Sprint.

When the companies announced a merger last April, it proposed a combination of the nation’s third and fourth-largest telecom players, a deal that would strengthen the oligopoly of cell service providers, with 95% of all mobile phones serviced by just three companies … instead of four.

A main focus of the new, slightly less mediocre T-Mobile will be to build out a 5G network that is actually accessible before its competitors can. All of the “Big 4” cell phone players have a 5G network in place but most are limited to certain locations and the majority of cell phones can’t connect to it.

Turns out, the only 5G phones on the market are the Samsung Galaxy and LG V50 ThinQ. So, sorry, but you’re just going to have to keep viewing your nudes in 4G for a bit longer.

BTW the deal isn’t done yet

But you said it was!

The approval by the DOJ was one hurdle to complete the deal, but it’s not the only roadblock in play. Because, you know, red tape. Fourteen state attorneys general filed a lawsuit in June attempting to block the merger, claiming that it would lead to higher prices for network services provided to consumers.

To quell the concerns of states, the DOJ negotiated a deal for T-Mobile and Sprint to sell off assets to Dish Network in order to create a new, fourth competitor in the wireless carrier space.

Dish is buying the prepaid assets (read: burner phones) of Sprint’s business and will utilize T-Mobile’s network for seven years in order to bring up its status as a true competitor up to speed.

All three companies stocks were up Friday as a result of the DOJ approval.

 

“SHOW ME THE MONEY!”

The sh*tstorm that is Andrea Orcel’s career is the stuff of young professional’s nightmares. Except, of course, for the part where he made like $55M over 6 years.

Let’s recap, shall we?

Andrea Orcel is, for all intents and purposes, a big swinging d*ck. The UBS rainmaker was Santander’s go-to i-banker … and has a certain affinity for Hermès ties. Some say he was UBS CEO Sergio Ermotti’s heir apparent.

But Andrea ain’t got no time to wait for that

Over what we can only assume was a three-martini lunch, in 2018 Mr. Orcel hastily accepted an offer to take over as CEO of Santander from long-time friend and business associate Ana Botín, Santander’s Executive Chairman (er, woman? C’mon you guys, it’s 2019).

Orcel and Santander quickly inked a deal which included a €17M sign-on bonus and up to €35M in Santander shares meant to make up for lost UBS equity. Oh, and a sentence that indicated Orcel would make “best efforts” to reduce the cost to Santander.

Anddd here’s where things go off the rails …

Orcel fully expected Santander to make him whole for his lost UBS compensation as is standard practice … and Santander expected UBS would pick up some of the difference. Unsurprisingly, UBS balked.

Santander then pulled its offer, lawyers got involved and all hell broke loose. Orcel is suing Santander for €100M, because would you expect a guy named Andrea to want anything less than ‘f*ck you’ money?

Things got even more strange on Friday when Santander was forced to address reports that Orcel had recorded convos with Botín and other Santander execs. During one of the recorded calls, Botín allegedly promised Orcel a different CEO gig to make things right.

This oughta end well for all involved …

 

THIS AIN’T IT COMMANDER-IN-CHIEF

The Commerce department dropped its Q2 GDP data on Friday and while it beat expectations of 1.8%, the 2.1% growth on an annual rate was a far cry from Q1’s 3.1%. The figure is also a departure from POTUS’ goal of 3% growth.

So how’d we do it?

Pat yourself on the back, consumers. The largest part of the economy, consumer spending, increased 4.3% due in large part to increasing wages and salaries. And consumer sentiment is near all-time highs, because what f*ckin trade war?!

Government spending also grew … but business investment fell roughly half a percent, hampered by the global economic downturn (read: you guessed it … trade war)

Bottom line

Economists believe that consumers will continue to go all Greg Jennings and carry the team until an agreement can be reached in the ongoing US-China trade war which should help settle business investor jitters.

Also likely to stoke business investment? A projected federal funds rate cut to be handed down by Jerry Interest Rates later this week.

 

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IN OTHER NEWS

• Jerry Interest Rates is about to make history. For the first time since the United States of America was eyeballs deep in a financial crisis, the Fed has plans to lower interest rates. The FOMC will meet this week and hand down a decision on Wednesday. Of course, the only real decision is whether the ‘league of extraordinary gentlemen’ will cut rates by 25 or 50 basis points. Economic data, and more importantly, market participants, point to a 25 basis point cut … with another 25 on the docket for later this year.

 

• London Stock Exchange is in talks with Blackstone Group to purchase data analytics platform Refinitiv Holdings. While the price hasn’t been nailed down, it’s been reported to be somewhere in the area of $15B to $27B. This comes less than a year after Blackstone acquired Refinitiv from Reuters.

 

• Oh, I’m sorry, I thought this was America. Zuckerberg and the no-fun police are banning alcohol and tobacco sales between users on Facebook and Instagram. Such sales were already prohibited in the marketplace, but this policy update extends now to direct user interactions. This announcement follows accusations from Sazerac CEO Mark Brown, who accused Facebook, eBay, and Craigslist of not doing enough to stop counterfeit spirit sales.

 

• Twitter shares rose 8.7% Friday after beating Q2 earnings estimates. Revenue came in at $841M, beating the $829M estimate and rising 18% from Q2 2018. The company also reported its biggest year over year increase in daily users in a period since 2017, gaining 5M and bringing the total to 139M. Analysts report that Jack Dorsey remains a weird f*cking dude.

 

• A former Scotia Capital and Bear Sterns trader, Corey Flaum, has pleaded guilty to manipulating the precious metal markets for 9 years. Long Dong Flaum, as he was known on the Street … by us, placed thousands of orders in futures contracts, which were subsequently canceled to benefit another position, starting in June 2007 in an effort to game the price of gold, silver, and platinum. The case if part of regulator’s crackdown on the practice known as “spoofing.”

 

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