|Day's Range||114.55 - 114.70|
(Bloomberg) -- In early June, the Museum of Plastic appeared in New York’s SoHo. Created to highlight the problem of ocean plastic, the space featured such exhibits as a giant receipt for $200 billion—the projected revenue for water in plastic bottles by 2022—listing other uses for the money, such as paying off the Fyre Festival debt. The pop-up was a marketing campaign to introduce Ever & Ever, a $1.99 bottle-shaped aluminum can with a screw-off top filled with soft-tasting water, balanced with electrolytes. The company says it’s coming to Walmart.com and Amazon.com “soon” and then to local convenience stores. It’s just one of a growing number of products being pitched as an alternative to the 50 billion single-use plastic bottles Americans use annually. Those consumers are more concerned about plastic in oceans than climate change, according to a new study by the Shelton Group; 80 percent said they would buy an alternative to single use plastic if given the option. It is, of course, absurd that water in any kind of container is touted as an environmental benefit. The only true eco-friendly way to consume water is to drink it from the tap.“Whether it’s water in bottles that are especially biodegradable, or water in cans, it’s something that’s a little better than plastic but shouldn’t be done at all,” says Peter Glecik, a scientist focused on water and climate issues and co-founder of the Pacific Institute. “Canned water is a marginal improvement over bottled water.” Even if someone created a 100 percent-recyclable bottle, the impact of transporting water to a packaging plant is notable, as is the packaging.Ever & Ever is the newest offering from All Market Inc., owners of Vita Coco coconut water. Mike Kirban, AMI co-founder and chief executive officer, conceived of it as a way to neutralize the environmental impact of difficult-to-recycle tetra-pack packaging: The company estimates it sells around 1.2 million containers of coconut water a day, mostly in the material. Ever & Ever cans, however, are made of recycled aluminum and are easy to refill with water. Still, they aren’t dishwasher-safe or designed to be re-used indefinitely. “Is it better to use a re-useable water bottle?” asks Kirban. “Yes, of course it is, but it’s not where consumers are. Tap water isn’t always an option. Practicality is a reality.”Canned water is having a moment in the U.S. Liquid Death, from former Netflix executive Mike Cessario, has raised $1.6 million in seed funding, using the tagline “Murder your thirst.” It’s a breakout hit with an audience that wants to drink water out of a tallboy beer can. Aquaman’s Jason Momoa introduced Mana Nalu and shaved his beard in a viral video to bring attention to oceanic plastic.“Every brand is going to speak to a different audience and have a different message associated with it. For us, we want to make sure there’s an ocean,” said Dune Ives, executive director of the ocean activist group Lonely Whale, which helped develop Ever & Ever with AMI. While aluminum cans aren’t going to save the world, Ives argues they will help alleviate a problem. While about 91 percent of plastic ends up as waste, 67 percent of aluminum cans are recycled, worldwide. “If you’re counting on one person to save the planet, you will be disappointed,” she said.Meanwhile, AMI is turning its attention to another product in an emerging space: Sparkling Vita Coco infused with hemp, in flavors like ginger-apple and lemon-cardamom, will be available early in August—in cans.To contact the author of this story: Kate Krader in New York at firstname.lastname@example.orgTo contact the editor responsible for this story: Joshua Petri at email@example.comFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The tech giant’s multiclass voting structure makes it nearly impossible to challenge its plans for the People’s Republic.
Facebook Inc. and Apple Inc. are most at risk if government regulators are serious about pursuing antitrust actions against Big Tech.
Credit has to be given where it's due. Roku (NASDAQ:ROKU) has done the unthinkable, beating tech giants like Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and Apple (NASDAQ:AAPL) in the streaming set-top box race, and keeping Amazon.com (NASDAQ:AMZN) in check.Source: Shutterstock In that light, the incredible bullishness that's driven Roku stock price higher by more than 600% since its 2017 IPO isn't all that shocking. * 3 Monthly Dividend Stocks to Buy Today If you missed the boat thus far though, now's not the time to jump into Roku stock. While it feels like the 300% advance of Roku stock price just since the end of last year is never going to stop, the fact of the matter is, big swings are the norm for this name. And too many signs already suggest the Roku stock price has peaked, even if just temporarily.InvestorPlace - Stock Market News, Stock Advice & Trading Tips ROKU Is Poised for a PullbackMost of the time, stocks more or less reflect their underlying value. Certainly, adjustments for the uncertainty of the future have to be made, and the market's broad tide can work for or against a particular equity. By and large, though, stock prices usually make some sense.Roku stock is repeatedly proving an exception to that norm.That's not to suggest the incredible rally of Roku stock so far this year has been entirely unmerited. As previously noted, the company did the unlikely by dethroning the likes of Google and Apple in the streaming set-top box arena, and it continues to grow. Indeed, ROKU has only recently found the winning formula for selling ad space in conjunction with selling hardware.ROKU is a stock, however, that is still figuring out its limits. The weekly chart of Roku stock tells the tale. This year's big advance has carried Roku stock price up to a ceiling connecting the peaks from early 2018 and the latter portion of 2018 [the surge in late 2017 was post-IPO volatility, and shouldn't be factored in]. Along the way, a relatively new ceiling that connects recent higher highs with the streak of higher highs in March has taken shape. Notice that the buyers of Roku stock were unwilling to keep pushing beyond either boundary.That's not the only red flag at this point, however. Neither is the fact that the 300% gain of Roku stock price in less than six months has pushed the limit of what should be possible.Rather, the most concerning aspect of this chart is how buying volume has been sinking since mid-May, even though Roku stock price has continued to edge higher.Without more buyers, the rally can't last. In fact, a closer look at the chart reveals that the momentum of Roku stock has already petered out. Last week's and the prior week's closes were notably below the intraweek highs. ROKU is struggling to hold into its big gain. The Outlook of ROKUIt's not the end of the world. Roku stock will most assuredly bounce back. Comebacks have been the norm for ROKU. The trick is simply figuring out where the bottom might take shape or spotting it as it's happening. Easier said than done, particularly right now , since there's no chart history that tells us much about ROKU's future lows.One possible framework that might come into play is Fibonacci retracement lines. This obscure trading tool says the most likely landing points are around $77 and then $57.50.Wherever that low ends up being made though, odds are uncomfortably high that it will be too far below the stock's current value to simply "ride out" the decline. Again, this is a name that's still looking for its post-IPO groove. With all the telltale clues of a decline in place, the risk of staying in ROKU looks much greater than the risk of getting out of it.As of this writing, James Brumley held no position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 * 5 Boring Stocks to Buy This Summer * 7 S&P 500 Stocks to Buy With Little Debt and Lots of Profits Compare Brokers The post Time to Take Profits on Roku Stock appeared first on InvestorPlace.
The state’s new digital privacy law will restrict the use of consumer data by Facebook, Google, and others.
Google made clear that it would apply the Nest name to all its smart homeproducts, but just how would it rename classic products? You now have a betteridea
Satellite startup SpinLaunch has as been awarded a responsive launch prototype contract from the Department of Defense, its first deal for the U.S. military.
It was a boring day for the Nasdaq today. While Friday's session highs did push it to new highs on the week, the index couldn't close there. The Nasdaq fell 0.24% on the day, but still logged a 3.1% gain for the week.Source: Shutterstock For comparison purposes, the S&P 500 rallied 0.02% and the Dow Jones fell 0.13% on Friday. Where does that leave us going into next week?Call me crazy, but it seems like there could be some upside. Short of geopolitical tension or trade-war tweets from the President over the weekend setting up the market for a selloff, some risks are being shelved for the moment. President Trump said he will meet with China's president at the G20 summit, which starts on June 28th. That's got investors cautiously optimistic.InvestorPlace - Stock Market News, Stock Advice & Trading TipsFurther, the Fed has more or less said it's willing to be accommodative going forward, while market expectations call for a rate hike at the July FOMC meeting. With equities holding up at or just below all-time highs, there's reason for optimism in the short term. * 5 Boring Stocks to Buy This Summer Whether a trade deal gets done doesn't immediately matter. Optimism for a productive meeting could be enough to gravitate stocks higher over the coming days. Trading the Nasdaq TodayWe don't usually use the Nasdaq today column to trade the index, but it's worth taking a quick peek.It's totally possible that 8,100 keeps the Nasdaq in check and we see a pullback down to the 50-day moving average. However, it's also possible that we're seeing a bullish inverse head-and-shoulders setup and that a move through 8,100 could trigger a rally to new all-time highs.As we pointed out earlier this week though, a move like this may be pretty tough without FANG and Apple (NASDAQ:AAPL) participating. We noted that Apple, Facebook (NASDAQ:FB), Netflix (NASDAQ:NFLX) and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) are more than 13% off their highs.Of the group, only Amazon (NASDAQ:AMZN) is less than 10% off its highs. Without FAANG participation, new highs will be hard -- but not impossible. Winners in the Nasdaq TodayBiotech and healthcare stocks continue to rack up decent gains this week. Gilead Sciences (NASDAQ:GILD) continues its breakout (flagged here), while Alexion Pharma (NASDAQ:ALXN) has strung together a nice multi-day win streak. The latter climbed another 2.75% on Friday, doing so on two-times normal volume. Biogen (NASDAQ:BIIB) and Incyte (NASDAQ:INCY) also logged decent gains on above-average volume.Overstock (NASDAQ:OSTK) racked up big-time gains on Friday, climbing 15.5% on positive commentary from its CEO. Specifically, he said there are "two very attractive acquirers" for its retail business in discussion. This stock is a controversial one, to say the least, but its action is worth mentioning.Is Slack (NYSE:WORK) a winner today? Well, its 3.8% slide makes it hard to say that it is. But that said, it's still 43% above its IPO price after going public on Thursday. Short of Uber (NYSE:UBER) and Lyft (NASDAQ:LYFT), the IPO market remains pretty hot. Losers of the DayThe gains come and the gains go -- and my do they do so quickly. Advanced Micro Devices (NASDAQ:AMD), Nvidia (NASDAQ:NVDA), Broadcom (NASDAQ:AVGO) and other chip stocks were among some of the market's biggest winners at the start of the week. Now, they're ending the week as some of the biggest losers. The U.S. banned more Chinese firms, helping deal a blow to the semiconductor group, while Micron (NASDAQ:MU) was another big laggard.Baird analysts cut their price target on Micron as they pushed back their expectations for a NAND recovery into 2020. It was a double-whammy though, as JPMorgan analysts also cut their EPS estimates for Micron, which fell 2.65% on the day. While shares closed of the lows, it lost its 10-day moving average and is setting up for more potential losses. It obviously hurt others in the group, like Lam Research (NASDAQ:LRCX) and Applied Materials (NASDAQ:AMAT) too.Shares of PayPal (NASDAQ:PYPL) slipped 2.2% on Friday after chief operating officer Bill Ready said he will leave the company to "pursue entrepreneurial interests outside the company." Don't worry though. In typical PayPal fashion, Ready will be around until the end of the year, so there's no reason to panic just yet.Nio (NASDAQ:NIO) looked like it wanted to breakout, but was quickly swatted lower when it ran into resistance. Shares sank 6.7% in Friday's session and is now teetering just above key support. * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 Finally, Align Technology (NASDAQ:ALGN) ended the week on a tough note, slipping 4.1%. The stock has been putting in a series of lower highs and looks like it could be rolling over. Let's see if the 200-day moving average can save it next week. Bottom Line on the Nasdaq TodayWhile bulls were likely looking for a stronger finish to the day, the markets did a solid job navigating this week's hurdles. Let's see if the Nasdaq can build on that momentum next week or whether a pullback is in store.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL, GOOGL, AMZN, AMD, NVDA and AVGO. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 * 5 Boring Stocks to Buy This Summer * 7 S&P 500 Stocks to Buy With Little Debt and Lots of Profits Compare Brokers The post Nasdaq Today: Maintaining Altitude Amid Uncertainty appeared first on InvestorPlace.
Google and PayPal have been strategic partners for some time. The companies in 2017 announced that PayPal would become a payment method in Android Pay, the service that later rebranded as Google Pay. Last year, users who added PayPal as a payment method on Google Pay could then pay for services like Gmail, YouTube, Google Play and Google Store purchases via a PayPal option in Google Pay.
(Bloomberg) -- A New York man who called himself “the Coyote of Wall Street” admitted he stole cash from clients who thought he’d use it to invest in cryptocurrencies.Patrick McDonnell, who ran CabbageTech Corp., pleaded guilty to wire fraud on Friday in federal court in Brooklyn."I perpetrated a fraud," McDonnell, 46, told U.S. District Judge Nicholas Garaufis. "I claimed to invest it in virtual currency and spent it on personal expenses."McDonnell, of Staten Island, solicited investors by falsely claiming on social media to have traded more than $50 million in Bitcoin for thousands of clients, prosecutors said. He even appeared on YouTube wearing a Guy Fawkes mask used by Anonymous hackers talking about virtual currencies.Instead, McDonnell pocketed his investors’ money, buying crytocurrencies for himself and spending at least $194,000, prosecutors alleged.McDonnell, who ran the scheme out of his home, pleading guilty to one count of fraud involving one investor. He said he took more than $164,000 from the man.Under the terms of the plea agreement, he faces between two years and 2 1/2 years behind bars when he’s sentenced Sept. 10, the judge said.McDonnell was one of several cryptocurrency promoters to be sued by regulators including the Commodity Futures Trading Commission. Last year, a Brooklyn judge concluded that McDonnell used trickery and lies to steal money and ordered him to pay $290,429 in restitution and $871,287 in penalties.To contact the reporter on this story: Patricia Hurtado in Federal Court in Manhattan at firstname.lastname@example.orgTo contact the editor responsible for this story: David Glovin at email@example.comFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Alibaba (NASDAQ:BABA) stock is reacting to the trade war with China by becoming more Chinese.Source: Shutterstock Lured by rules that allow listing of dual-class shares in Hong Kong, Alibaba has announced plans to raise $20 billion there after doing an 8:1 stock split. Dual class shares were forbidden in Hong Kong when Alibaba went public in New York in 2014.The split will make it possible to buy a share in the company, which opened for trade at about $166 on June 19, for just under $21. This makes it affordable to small Chinese investors.InvestorPlace - Stock Market News, Stock Advice & Trading TipsWhile American business writers file gigabytes about how to trade this or what it means to us, it's not about us.It's about China. Alibaba as ChinaAlibaba has become a proxy for what is possible to ordinary Chinese by combining the Horatio Alger maxims of co-founder Jack Ma with the absolute obedience preached by Chinese president Xi Jinping. * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 Alibaba bought the South China Morning Post, Hong Kong's leading news outlet, in 2015. It now finds itself caught between the Xi government and the demand of Hong Kong's people for autonomy. Millions of people, a substantial portion of Hong Kong's population, have participated in protests over a proposal to allow quick extradition, to China, of people accused of crimes.China's government could crack down, as it did in Beijing 30 years ago, stifling democratic impulses. But the price could be heavy. So far, the government has backed off its proposal, but has taken no further action.The Post has covered the story but has mostly focused on stories like a call to "restore business confidence." The protests threaten to overshadow the listing and the stock split. Ma's DreamWhile giving full autonomy to CEO Daniel Zhang and a new executive team and preparing for his own retirement in September, Ma is quietly making Alibaba more of a tech play and less of the retail play Zhang had crafted. Its Hema supermarket unit, for instance, will be split off. CEO Zhang told Reuters the moves are meant to "guarantee innovation." The moves indicate more focus on Alibaba's cloud, which is gaining the same global footprint as the American "Cloud Czars." But the Alibaba cloud, unlike the American clouds, is based on Alibaba's own business applications. The company need not worry about charges of being a "monopoly" since, to Chinese leaders, that's not a bad thing, So long as the monopoly is answerable to government power.Ma himself, who is China's richest man and also a member of the Chinese Communist Party, talks about going into teaching and philanthropy. He speaks of following the example of Microsoft (NASDAQ:MSFT) co-founder Bill Gates, who also retired from business in his mid-50s.But Ma won't be, and can't be, Gates, anymore than he can be Forrest Gump, the American movie character he so loves. That's because Ma is Chinese, and Alibaba is Chinese, subjects to a strong central government that hands out freedom with an eye dropper. The Bottom LineIn the end, Alibaba's moves could be a godsend to American companies like Amazon (NASDAQ:AMZN), Alphabet's (NASDAQ:GOOG, NASDAQ:GOOGL) Google, and Facebook (NASDAQ:FB), which face calls in Europe and America to be broken up.Alibaba's market cap, at $435 billion, is a little over $100 billion short of Facebook. Breaking up the American czars would leave the market open to BABA stock. Cloud investors hope that fact will stay any trust-busting hands.Dana Blankenhorn is a financial and technology journalist. He is the author of a new environmental story, Bridget O'Flynn and the Bear , available now at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing he owned shares in AMZN and MSFT. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 7 Best Dow Jones Stocks to Buy for the Rest of 2019 * 5 Boring Stocks to Buy This Summer * 7 S&P 500 Stocks to Buy With Little Debt and Lots of Profits Compare Brokers The post With Alibaba, Itas Not About You, Itas About China appeared first on InvestorPlace.
As the Trump administration puts tariffs on a range of imported goods and pushes a replacement deal for Nafta, lobbying on trade-related issues could set a new record this year.
The Daily Crunch is TechCrunch's roundup of our biggest and most important stories. “For Google’s first-party hardware efforts, we’ll be focusing on Chrome OS laptops and will continue to support Pixel Slate,” the company said in statement. Google SVP Rick Osterloh took to Twitter to emphasize that while Google's hardware team will be "solely focused on building laptops moving forward," the company will still be working with partners on Android and Chrome OS tablets.
Yesterday afternoon, Google's hardware division made an unusually forthcomingannouncement: The company will no longer build its own tablets
At first glance, everything appears to be going right for Amazon (NASDAQ:AMZN). After a tough second half of last year, and some unnecessary personal scandals involving CEO Jeff Bezos, Amazon stock regained its mojo. Having spent the last two weeks climbing back to above the $1,900 barrier, AMZN stock seems, psychologically, ready for the trip to $2,000.Source: Shutterstock But is that really the case? Another possibility is that the $2,000 level will represent strong technical resistance for Amazon stock. Let's face it: this recent bout of bullishness couldn't have come at a more awkward time.Primarily, the U.S.-China trade war imposes an overhang on AMZN stock. Because the ecommerce juggernaut is levered toward multiple businesses, thanks to its disruption ethos, Amazon had some geopolitical protection. However, even a dominant force like this can't ignore the prospects for prolonged tensions.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Value Stocks to Buy for the Second Half And by the way, the multiple disruptions are also risk factors. For example, a drawn-out trade war will likely result in a million Americans losing their jobs. That would create a ripple effect that would devastate consumer sentiment.Obviously, such a situation will hurt most aspects of AMZN stock, not just e-commerce.Still, I think AMZN is a remarkable organization. Hard evidence also shows that standard business rules don't apply to the company. Therefore, despite some nearer-term challenges, I like Amazon stock for the long haul. Here are three reasons why: Alexa? Are Smart Speakers a Game-changer for AMZN Stock?If you just looked at the technical charts for Amazon stock, you'd come to a mistaken assumption that the underlying company has no ongoing controversies. Of course, the reality is that Jeff Bezos and company are surely feeling some regulatory heat.I say this because the Federal Trade Commission and the Department of Justice are eyeballing the FAANG stocks for improprieties. In addition to AMZN, we're talking about Facebook (NASDAQ:FB), Apple (NASDAQ:AAPL), and Alphabet (NASDAQ:GOOGL). Fortunately for streaming investors, Netflix is off this undesirable list.These particular investigations focus on anti-competitive practices. But the broader point is that, as a large organization, Amazon attracts regulatory attention. This attention covers a range of issues. For instance, Facebook's Cambridge Analytica scandal sparked privacy concerns against other tech firms, including AMZN.Given the rising trend of anti-big business sentiments, Amazon stock faces longer-term challenges. But its recent development involving its Echo smart speakers could redirect oversight issues in a favorable direction.Bloomberg ran a story explaining that the Echo could detect the unusual sleeping noises associated with heart attacks. It's quite literally a life-saving technology that deserves additional investigation and support.It also flips the privacy issue on its back. In this case, you'd want the Echo to violate your privacy if it means saving a loved one's life.Not only that, Amazon can make the argument that its large organizational structure is needed to develop these groundbreaking innovations. That might put oversight committees in a difficult position, indirectly helping AMZN stock. Amazon Stock to Rise from Comprehensive Retail DominanceI don't blame investors for experiencing some confusion when dealing with Amazon stock. The underlying firm spreads its disruptive canvas far and wide. From cloud computing to groceries, Amazon does it all.But from an investment perspective, it's important not to forget the core catalyst driving AMZN stock: retail. Sure, divisions like AWS and the aforementioned smart-speaker lineup offer compelling narratives. However, this is still very much a retail play.To that end, Amazon is getting very exciting again. First, let's mention the obvious: e-commerce is steadily representing a greater piece of the total-retail sales pie. In the first quarter of this year, more than 10% of all retail revenue originated from e-commerce platforms.All indications suggest that this trend will move higher. Even during recessions, e-commerce has made strides. Since Amazon dominates the digital marketplace, it's only logical to assume AMZN stock also jumps in value.Moreover, Amazon is also going after the last holdout of the modern retail environment: lower-income consumers. People in this category prefer shopping at big-box discount chains or dollar stores. But AMZN will introduce a series of incentives, including EBT-card acceptance, to sway this demographic.Let's give it up for management, which is making yet-another smart decision. With the 5G rollout coming, telecommunication services will reach a wider audience. Older but still very adequate technologies will become cheaper, encouraging lower-income consumers to advantage e-commerce conveniences.And when you're talking e-commerce, all roads eventually lead to Amazon stock. Old Rules Don't Apply to AMZNI hesitate to mention this, but when you look at Amazon as a whole, you can't help but think that it's a near-miraculous company.Usually, organizations involved in disparate businesses attract criticism. That's especially true today, with the likes of General Electric (NYSE:GE) struggling for both traction and relevancy.AMZN really shouldn't be doing so well. It wasn't satisfied dominating e-commerce, so it moved into multiple sectors: physical commerce, cloud computing, video games, groceries, health care, and the list goes on. It's a modern-day GE.Yet they find a way to make it work. Since at least Q4 2006, Amazon has never experienced year-over-year revenue growth below double digits. That's just a remarkable phenomenon made even more impressive that the company must contend with the law of large numbers.Overall, this gives me the confidence that you can hurt Amazon stock, but you'll never keep it down forever.As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Value Stocks to Buy for the Second Half * 7 Hot Stocks to Buy for a Seemingly Sleepy Summer * 6 Chip Stocks Staring At Big Headwinds in 2019 Compare Brokers The post 3 Reasons To Buy Amazon Stock For Your Long Haul Investment Portfolio appeared first on InvestorPlace.
The low volatility factor is one of the more beloved investment factors and when it comes to exchange traded funds dedicated to this school of investment thought, two in particular are, well, beloved. FDLO, which was one of just over 200 ETFs to hit all-time highs on Thursday, tracks the Fidelity U.S. Low Volatility Factor Index. A look under the hood, as is always required with ETFs, reveals that FDLO is not the run-of-the-mill low volatility ETF.
(Bloomberg Opinion) -- Central banks and financial regulators have been on high alert since the launch of Facebook Inc.’s proposed cryptocurrency, Libra. It’s still at the conceptual stage, but the prospect of a tech giant with 2.6 billion users shuffling digital money around and backing it with piles of dollars, euros and pounds is a potential heart attack in the making for those trying to keep the financial system stable, governable and predictable. That means setting the rules now, before Libra’s born.One idea as to how officials might keep CEO Mark Zuckerberg’s dreams grounded in reality is to get under the hood of what goes into the digital currency in the first place. Given Libra wants to back every digital cent with a mix of real-world reserve currencies, that might be the best place to start. Bank of England boss Mark Carney hinted at this in his Mansion House speech on Thursday, proposing that tech firms and other non-banks be allowed to hold funds directly at the central bank.You can see why this idea would appeal. If central banks start to hold deposits for the likes of Facebook and other Libra backers, officials will get a first-hand view of the assets held in reserve (though they’ll have to coordinate for a complete picture). And for the tech companies, having the central bank’s blessing is the ultimate seal of approval and trust — something Zuckerberg could benefit from. It would all require a fair bit of readjustment in terms of what a central bank does and how it does it, but it makes sense.While this will all seem like a specific issue of financial plumbing off the back of a crypto project, there’s a much bigger point here about finance and tech in general — and not all of it comforting for bankers.Carney’s push for new tech companies to be embedded more deeply in the financial system will raise competitive pressure on incumbent banks. The regulatory barriers to entry in finance are already high — think of the billions spent on compliance — and it’s a reason why Silicon Valley hasn’t yet posed an extinction threat for banks. But officials want more firms to clear those barriers, “leveling the playing field between old and new,” Carney says. Hence, he also talked up the central bank’s payments system overhaul, with a view to plugging in tech firms. Libra could just be a face that launches a thousand ships of new payments ideas – the crypto bit might never take off, but other ideas will.Banks have done a decent job of fending off fintech over the past decade: 35 percent of British consumers have had the same account for at least two decades, according to UBS. But that’s partly because their opponents have been pretty under-powered: No amount of glitzy tech conferences featuring entrepreneurs kitted out in lederhosen can disguise that. Start-ups have been forced down a risky path to grow fast in a market that’s highly regulated and concentrated.Facebook, as well as Apple Inc., Amazon.com Inc. and Alphabet Inc. are different. They have size: Apple is in “a billion pockets,” as Oprah Winfrey put it. They have money: Alphabet’s revenue in a single quarter could cover the market cap of Deutsche Bank several times over. And they have data: Amazon has our credit card details, and indeed its own card. With their main businesses drawing tough criticism over monopoly concerns, more diversification — even into a very regulated sector — is investor-friendly.Libra specifically may well be a pipe dream that may never be implemented in its current form. But Facebook’s size means that central banks already have to take it seriously — or they face being unprepared to ensure financial stability. Bankers themselves aren’t powerless to respond to the tech threat, and they have the financial firepower to develop services and products. But as after dinner speeches go, this was a sobering one. To contact the author of this story: Lionel Laurent at email@example.comTo contact the editor responsible for this story: Jennifer Ryan at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Lionel Laurent is a Bloomberg Opinion columnist covering Brussels. He previously worked at Reuters and Forbes.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg) -- The advertising industry’s annual gathering on the French Riviera has become a recurring cycle of contrition from technology giants and admonishment from the Mad Men. In 2017, it was YouTube apologizing for ads appearing next to jihadist terror videos. In 2018 came Facebook Inc.’s mea culpa for a data privacy scandal. This year, Facebook regretted live-streaming a mass shooting in New Zealand and YouTube battles the spread of hate speech.All the while, the marketing money continues to flow. Facebook and Google’s advertising sales grew 38% and 22%, respectively, in 2018, and both dominated the beach front in Cannes again this year with showy largess. Google served up grape smoothies, gingerbread ice cream and live tunes from synth-pop duo Pet Shop Boys and electro outfit Justice. Facebook held panels with Grammy-winning singer-songwriter John Legend and style icon Jenna Lyons, while Chief Operating Officer Sheryl Sandberg hosted some of the biggest advertisers by the shore.But the recurring scandals hitting the tech giants have created a dilemma for chief marketing officers. Do they take a principled stand and move their ad dollars elsewhere, sticking to more traditional media like TV and newspapers but missing out on the global reach and hyper-specific targeting of consumers that the platforms afford? Or do they accept the risk of being drawn into future hate speech and toxic content controversies, if it means they can keep growing sales? The consensus in Cannes this year from advertisers: let’s ride it out.“Every once in a while there’s going to be a screw-up and unfortunately the screw-ups are pretty big,’’ said Michael Roth, chairman and chief executive officer of the Interpublic Group of Cos., the world’s fourth-largest advertising company by revenue. “The thing is, it still works.”Unlike the past, when adverts were confined to spaces curated by professionals, such as TV commercial breaks, radio programs or billboards, chief marketing officers are opting to get comfortable with the daily risks of placing their products alongside non-vetted, user-generated content.In Cannes, Facebook and Google both stressed their latest efforts to keep their platforms safe, from investing in machine learning that spots offending material before it’s uploaded to hiring more humans to oversee posts. But each conceded they’ll never keep all the objectionable material at bay. Sandberg said Facebook had a ‘Herculean’ task on its hands and that generally, all technologies can be used for both bad and good.“Bad actors are smart and find ways to circumvent our policies and brush right against where the new line has been drawn,’’ said Cecile Frot-Coutaz, YouTube’s head of Europe, Middle East and Africa. “It’s that delicate balance of keeping the openness but protecting our users and advertisers.”YouTube’s latest controversy is how it keeps its service safe for children, after predators were found to be leaving pedophile comments on videos featuring kids. YouTube has previously come under fire for allowing fake or misleading content to flourish on its platform, and not removing videos with homophobic and racist remarks.Pressure isn’t just building from marketers, but also from other platforms touting their wares in Cannes to lure spending. Amazon.com Inc. hosted meetings in a top-floor suite at the five-star Carlton hotel with spectacular views over the Mediterranean, showing brands how they can advertise in Amazon search results and grow sales through its Alexa smart speaker. Snap Inc. entertained guests in a contemporary art museum, handing out rainbow-colored flip-flops. Music streamer Spotify Technology SA and Walt Disney Co.’s Hulu brought in Grammy-nominee Ciara for a VIP party at a hillside villa.Advertisers’ latest initiative to tackle the issue of safety online is a so-called ‘Global Alliance for Responsible Media’ that includes brands, ad agencies and platforms. Yet pushed at the partnership’s launch on specific measures they’d like to see, marketers from consumer-goods giant Unilever, confectionery manufacturer Mars Inc. and drinks-maker Diageo Plc weren’t forthcoming.Yannick Bollore, CEO of ad giant Havas, called it “unthinkable” not to advertise on social platforms, because that’s where consumers spend most of their time.“But we need to guarantee to our clients that we can find a positive environment,” he said in an interview in Cannes.His counterpart at WPP, Mark Read, went furthest in publicly suggesting changes that might be needed, mooting moderation of content in certain categories or limiting what can be posted from new accounts.“We need to think about the design of the platforms,” Read said, whose London-based advertising group spends billions of dollars of client money with Facebook and Google. “Clearly they haven’t done enough.”Marketers are making investment decisions at a time when the average tenure of a chief marketing officer, or CMO, is a mere 43 months, or less than half of that of a CEO, according to research by headhunters Spencer Stuart. Their short shelf-life shows the scrutiny they’re under from their boards, said Michael Kassan, founder of MediaLink, which advises the world’s most influential marketers and media companies.“The easiest way to talk is with your cheque book,” Kassan said. “But the pressure on a CMO to deliver results is intense.”And even if marketers wanted to force change through financial pressure, it’s not clear it would work. The tech giants have built a base of millions of small- and medium-sized businesses that advertise using their tools, which limits the leverage of any particular brand, said Pedro Earp, chief marketing officer of beer-maker Anheuser-Busch InBev NV.“Some of these issues are complicated and aren’t solvable like that,” Earp said, who sits on Facebook’s client council which consults on how to improve the platform for advertisers. “It’s been a constructive dialog.”But so long as Facebook and Google continue to offer marketers an unparalleled ability to reach consumers and ease of use, they’ll keep dominating the industry, said Wenda Harris Millard, vice president at MediaLink and based in London.“For advertisers it’s kind of like, ‘Do I press the F button or the G button?”’ she said. “It’s hard to stop all this.”To contact the reporters on this story: Joe Mayes in London at email@example.com;Angelina Rascouet in Paris at firstname.lastname@example.orgTo contact the editors responsible for this story: Rebecca Penty at email@example.com, Benedikt KammelFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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