WEBVTT - Tesla Earnings Selloff; Trump to Testify at Trial

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<v Speaker 1>Good morning.

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<v Speaker 2>I'm Nathan Hager and I'm Amy Morris. Here are the

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<v Speaker 2>stories we're following today.

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<v Speaker 3>Shares of Tesla are going in reverse this morning. They're

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<v Speaker 3>down more than seven percent in the pre market. The

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<v Speaker 3>electric vehicle maker says it expects sales growth this year

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<v Speaker 3>to be quote notably lower. We get more from Bloomberg's

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<v Speaker 3>Oliver Kruk.

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<v Speaker 4>They gave no guidance in terms of deliveries for this year.

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<v Speaker 4>They delivered one point eight last year million. That is

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<v Speaker 4>they're expecting two point two. That's what the analysts are expecting.

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<v Speaker 4>That's still twenty percent growth against a backdrop that is

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<v Speaker 4>challenging for a lot of the auto sector and a

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<v Speaker 4>lot of the EV market. There's going to be a

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<v Speaker 4>slow down in EV's that seems more or less certain

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<v Speaker 4>this year. Interest rates, basically, Elon Musk said that our

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<v Speaker 4>margin is directly pegged to interest rates in the United States,

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<v Speaker 4>So if they come down, our margins will be good.

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<v Speaker 4>If they don't, they'll be worse. And there's a competition

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<v Speaker 4>from China. There's all these other competitors with cheaper models

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<v Speaker 4>that are coming into the market.

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<v Speaker 3>Bloomberg Zolli Krouk says On the conference call, Elon Musk

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<v Speaker 3>said he needs a bigger steak in Tesla to prevent

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<v Speaker 3>being ouse to a CEO. Right now, he owns about

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<v Speaker 3>thirteen percent of the company.

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<v Speaker 2>While Taesla's shares are sliding. It's a different picture at

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<v Speaker 2>IBM this morning, shares up more than seven and a

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<v Speaker 2>half percent. The company delivered a positive outlook for revenue

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<v Speaker 2>and cash flow in twenty twenty four. Those details now

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<v Speaker 2>from Bloomberg's Charlie Pellett.

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<v Speaker 5>It is an optimistic signal for the pace of corporate

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<v Speaker 5>technology spending. IBM also announced it does expect to reduce

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<v Speaker 5>jobs by a percentage in the low single digits. The ARMANC,

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<v Speaker 5>New York based company has focused on streamlining its operations

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<v Speaker 5>around software and services in recent years by divesting managed infrastructure, weather,

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<v Speaker 5>and health businesses. IBM has also introduced new products to

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<v Speaker 5>capitalize on growing interest in artificial intelligence in New York.

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<v Speaker 5>Charlie Pellett Bloomberg.

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<v Speaker 3>Radio, All right, Charlie, thank you. We're also following Boeing

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<v Speaker 3>this morning. That stock is down another two percent. The

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<v Speaker 3>Federal Aviation Administration is freezing planned production increases for Boeing

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<v Speaker 3>seven thirty seven Max. At the same time, the FAA

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<v Speaker 3>approved inspection procedures that airlines need to carry out in

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<v Speaker 3>order for the Max to resume flights. Boeing CEO Dave

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<v Speaker 3>Calhoun met with senators yesterday. Before that meeting, he was

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<v Speaker 3>asked what message he has for concerned passengers.

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<v Speaker 6>We fly safe planes. We don't put airplanes in the

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<v Speaker 6>air that we don't have one hundred percent confidence in.

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<v Speaker 6>I'm here today in the spirit of transparency to number one,

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<v Speaker 6>recognize the seriousness of what you just asked. Number two,

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<v Speaker 6>to share everything I can with our Capitol Hill interests

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<v Speaker 6>and answer all their questions because they have a lot

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<v Speaker 6>of them.

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<v Speaker 3>I'm Boeing CEO Dave Calhoun told senators the planemaker's current

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<v Speaker 3>safety issue can be resolved in days and weeks, not months.

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<v Speaker 2>Turning to politics now, Earlier this week, Donald Trump was

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<v Speaker 2>in New Hampshire for the primary. Now he is set

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<v Speaker 2>to take the witness stand today in the defamation suit

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<v Speaker 2>brought by Ejing Carrol Bloomberg's Ed Baxter has that story.

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<v Speaker 7>This comes two days after his New Hampshire victory, and

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<v Speaker 7>he'll be in front of a jury. Carol contends his

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<v Speaker 7>denials of her rape clam have hurt her reputation. It

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<v Speaker 7>gives Trump a chance in the witness box to repeat

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<v Speaker 7>the denials. This could be very contentious. Judge Lewis Kaplan

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<v Speaker 7>has already held Trump liable for defamation, and if Trump

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<v Speaker 7>ignores the judicial restraints on what he can say, as

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<v Speaker 7>he has in the past, it could lead to fireworks.

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<v Speaker 7>Last week, remember Kaplan threatened to bar him from the courtroom,

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<v Speaker 7>saying he couldn't control himself. Ed Baxter Bloomberg Radio, all.

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<v Speaker 8>Right, and thank you.

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<v Speaker 3>As for President Biden, he's picked up a key endorsement

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<v Speaker 3>as he ramps up his reelection campaign, winning the banking

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<v Speaker 3>of the United Autoworkers' Union UAW. President Sean Fain says

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<v Speaker 3>the president has earned it.

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<v Speaker 9>He joined us in solidarity on the picket line for

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<v Speaker 9>the first time in our nation's history a sitting president

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<v Speaker 9>has ever done that.

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<v Speaker 3>And the UAW Shan Fain laid into former President Trump,

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<v Speaker 3>calling him a scab who represents billionaires. President Biden says

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<v Speaker 3>he's kept his word to be the most pro union

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<v Speaker 3>president ever.

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<v Speaker 5>I'm proud you have my back.

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<v Speaker 4>Let me just say, I'm honored to have your back

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<v Speaker 4>and you have mine.

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<v Speaker 5>That's the deal.

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<v Speaker 3>How President Biden will still need to win the back

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<v Speaker 3>of rank and file union members. The UAW says it'll

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<v Speaker 3>ramp up get out the vote efforts for the president

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<v Speaker 3>in Michigan and other battleground states.

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<v Speaker 2>The Federal Reserve has raised the rate on loans to

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<v Speaker 2>banks issued under an emergency lending program launched last year.

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<v Speaker 2>The move comes after borrowing surged in recent weeks as

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<v Speaker 2>institutions took advantage of the attractive financing terms overseas.

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<v Speaker 3>Amy we're expecting a policy decision from the European Central Bank.

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<v Speaker 3>Economists to expect the ECB to leave rates unchanged in

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<v Speaker 3>its first monetary policy decision of the year. Instead, the

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<v Speaker 3>focus is on President Christine Legard's news conference and any

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<v Speaker 3>fresh signals on the outlook for borrowing costs and.

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<v Speaker 2>A warning from former Treasury Secretary Robert Rubin. He says

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<v Speaker 2>risks are even greater today than in the early nineteen nineties,

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<v Speaker 2>when incoming President Bill Clinton crafted a budget tightening package

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<v Speaker 2>to shrink the deficit. Reuben spoke with David Weston on

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<v Speaker 2>Bloomberg's Wall Street Week.

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<v Speaker 10>I think we're in a terrible place because, unfortunately, once

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<v Speaker 10>you get to legislating.

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<v Speaker 5>There isn't the will.

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<v Speaker 10>There's a lot of talk, but the talk is always

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<v Speaker 10>divided politically between the Republicans who refused to raise taxes

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<v Speaker 10>and the Democrats who won't deal in titlements.

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<v Speaker 2>You can catch the entire interview with former Treasury Secretary

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<v Speaker 2>Robert Rubin on Bloomberg Wall Street Week with David Weston

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<v Speaker 2>on both Bloomberg Radio and television.

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<v Speaker 3>And this note from overseas Amy. Pay for most senior

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<v Speaker 3>investment bankers at Wall Street firms in Asia fell to

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<v Speaker 3>its lowest level in almost two decades. Sources say total

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<v Speaker 3>compensation in Asia, leaving out Japan fell to between seven

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<v Speaker 3>hundred thousand to eight hundred thousand dollars. That is well

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<v Speaker 3>below the million or more that senior investment bankers have

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<v Speaker 3>typically earned. At least twenty percent at Managing directors at

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<v Speaker 3>lenders including Morgan, Stanley and Ubs received no bonuses last

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<v Speaker 3>year in Asia.

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<v Speaker 2>Time now for a look at some of the other

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<v Speaker 2>stories making news around the world, and for that we're

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<v Speaker 2>joined by Bloomberg's John Tucker.

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<v Speaker 5>Good morning John, and Good morning Amy.

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<v Speaker 11>There is hope of a bipartisan border deal, but some

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<v Speaker 11>lawmakers say if they're no big policy changes, then immigration

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<v Speaker 11>reform is dead on a rival. More from Bloomberg's Nancy Lyons.

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<v Speaker 12>The details of the agreement have not yet been released,

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<v Speaker 12>but some Republican senators are already criticizing the bones of

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<v Speaker 12>the deal, like you TOAs Mike Lee.

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<v Speaker 13>I have great respect for colleagues who are working hard

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<v Speaker 13>trying to fix the problem, and I'm sure they are

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<v Speaker 13>coming up with some provisions that might help certain things.

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<v Speaker 13>But from what I'm hearing, this could cause as many

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<v Speaker 13>problems as it's sold.

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<v Speaker 12>The bill being drafted would reportedly grant humanitarian parole to

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<v Speaker 12>five thousand undocumented immigrants a day. These GOP lawmakers say

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<v Speaker 12>that's a magnet that will draw more people to our

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<v Speaker 12>border in Washington, Nancy lyons Bloomberg Radio.

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<v Speaker 11>Nicky Haley campaigns in our home state of South Carolina.

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<v Speaker 11>Last night, she talked in part about Donald Trump's reaction

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<v Speaker 11>to her not dropping out of the race after New Hampshire.

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<v Speaker 8>He pitched a fit, he was insulting.

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<v Speaker 12>He was doing what he does, But I know that's

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<v Speaker 12>what he does when he's insecure.

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<v Speaker 5>I know that's what he does when he.

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<v Speaker 4>Is threatened, and he should feel threatened without a.

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<v Speaker 11>Doubt, Haley is vowing to press on. Thanks to the

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<v Speaker 11>backing of Wall Street Titans, wealthy donors, and a group

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<v Speaker 11>funded by industrialist Charles Koch means she has enough funding

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<v Speaker 11>to keep running. Another attempted attack on merchant shipping by

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<v Speaker 11>iranbak Houthi militants. US Central Command says US Guided missile

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<v Speaker 11>destroyer shot down two anti ship ballistic missiles aimed at

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<v Speaker 11>two American flag vessels in the Gulf of Aden. A

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<v Speaker 11>third missile fell into the sea. The attack is the

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<v Speaker 11>first in five days, comes despite multiple rounds of retaliatory

0:07:49.160 --> 0:07:52.680
<v Speaker 11>strikes by the US and the UK. Fox has been

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<v Speaker 11>ordered to face a two point seven billion dollar defamation

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<v Speaker 11>lawsuit by Smartmatic Corporation, one of two voting technologies companies

0:08:00.800 --> 0:08:04.240
<v Speaker 11>falsely accused on Fox News of rigging the twenty twenty

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<v Speaker 11>presidential election against Donald Trump. The decision Wednesday by New

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<v Speaker 11>York Jidts Who's the latest sent back for Fox after

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<v Speaker 11>the media giant agreed in April to pay seven hundred

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<v Speaker 11>and eighty eight million dollars to settle a similar suit

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<v Speaker 11>by Dominion Voting Systems. Global News twenty four hours a

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<v Speaker 11>day and whatever you want it with Bloomberg News Now.

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<v Speaker 11>I'm John Tucker Han. This is Bloomberg Amy.

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<v Speaker 2>All right, thank you John. We bring you the news

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<v Speaker 2>throughout the day here on Bloomberg Radio. But now you

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<v Speaker 2>can get the latest news on demand whenever you want it.

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<v Speaker 2>Subscribe to Bloomberg News Now to get the latest headlines

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<v Speaker 2>at the click of a button. Get informed on your schedule.

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<v Speaker 2>You can listen and subscribe to Bloomberg News Now on

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<v Speaker 2>and anywhere else you get your podcasts. Time now for

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<v Speaker 2>our Bloomberg Sports Updated. For that, we bring in John

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<v Speaker 2>stash Hour.

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<v Speaker 14>Amy Jin. Harbaugh was going to be a hot NFL

0:09:03.760 --> 0:09:07.000
<v Speaker 14>coaching commodity considering the success he had had with the

0:09:07.040 --> 0:09:08.680
<v Speaker 14>forty nine Ers getting them to the Super Bowl, and

0:09:08.679 --> 0:09:11.480
<v Speaker 14>then when he coached Michigan too the undefeated season of

0:09:11.480 --> 0:09:14.480
<v Speaker 14>the National Championship, he became even hotter. Spoke with many

0:09:14.880 --> 0:09:17.760
<v Speaker 14>NFL teams, but the LA Chargers were always seen as

0:09:17.800 --> 0:09:21.440
<v Speaker 14>the favorites. He wants quarterback the Chargers back in nineteen

0:09:21.520 --> 0:09:24.720
<v Speaker 14>ninety nine. In two thousand, hits official a five year deal,

0:09:24.840 --> 0:09:28.920
<v Speaker 14>Harbaugh taking over an underachieving Chargers team that has a

0:09:28.920 --> 0:09:34.000
<v Speaker 14>good quarterback in Justin Herbert Nick. Sirianni staying in Philadelphia,

0:09:34.040 --> 0:09:37.440
<v Speaker 14>but the Eagles changing both coordinators and they say that

0:09:37.520 --> 0:09:40.800
<v Speaker 14>Sirianni will no longer be as involved in the offense.

0:09:40.840 --> 0:09:43.640
<v Speaker 14>The Eagles had that horrendous slump at the end of

0:09:43.679 --> 0:09:48.240
<v Speaker 14>this past season. Joe Tony, pro Bowl guard doubtful for

0:09:48.360 --> 0:09:51.679
<v Speaker 14>the Kansas City Chiefs in their AFC Championship game Sunday

0:09:52.200 --> 0:09:56.200
<v Speaker 14>in Baltimore, NBA Milwaukee Cleveland won twenty six to one sixteen.

0:09:56.240 --> 0:09:57.920
<v Speaker 14>It was the first game for the Bucks since the

0:09:58.000 --> 0:10:01.880
<v Speaker 14>coaching change the firing of Adrian Griffin. Joe Prunty coached

0:10:01.880 --> 0:10:05.040
<v Speaker 14>them last night, but Doc Rivers is taking over the Bucks.

0:10:05.240 --> 0:10:08.760
<v Speaker 14>He went to college in Milwaukee at Marquette. He's had

0:10:08.840 --> 0:10:12.720
<v Speaker 14>sixteen straight coaching seasons with an over five hundred record.

0:10:12.880 --> 0:10:15.240
<v Speaker 14>Minnesota got thirty eight points from Anthony Edwards in a

0:10:15.280 --> 0:10:18.360
<v Speaker 14>one eighteen one oh seven win at Washington. The Warriors

0:10:18.360 --> 0:10:20.080
<v Speaker 14>played for the first time since the death of their

0:10:20.120 --> 0:10:23.880
<v Speaker 14>assistant coach Dejon Milojovich. They beat Atlanta one thirty four

0:10:23.880 --> 0:10:26.839
<v Speaker 14>to one twelve. Joseph Kamega scored twenty five points. He

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<v Speaker 14>shot eleven for eleven John Stashanward Bloomberg Sports.

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<v Speaker 8>From coast to coast, from New York to San Francisco,

0:10:36.320 --> 0:10:41.400
<v Speaker 8>Boston to Washington, DC, nationwide on SYRIASXAM, the Bloomberg Business

0:10:41.400 --> 0:10:45.160
<v Speaker 8>appened Bloomberg dot Com. This is Bloomberg Daybreak.

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<v Speaker 5>Good morning.

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<v Speaker 3>I'm Nathan Hager. The latest earnings report from Tesla isn't

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<v Speaker 3>exactly giving investors a charge this morning. The electric vehicle

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<v Speaker 3>Giant came in with earnings and revenue just shy of

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<v Speaker 3>Wall Street estimates, but CEO Elon Musk's warning that growth

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<v Speaker 3>will be notably lower this year is certainly putting a

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<v Speaker 3>weight on the share price this morning. So let's get

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<v Speaker 3>more on the outlook for Tesla and EV's. We're joined

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<v Speaker 3>now by Bloomberg News transportation reporter Danny Lee. Danny, thanks

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<v Speaker 3>for being with us. Notably lower is that the phrase

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<v Speaker 3>that's gott investors spoke this morning.

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<v Speaker 15>I think it's a combination of being notably lower or

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<v Speaker 15>nottally slower in fact on growth, and the EV Giant

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<v Speaker 15>didn't even offer four year guidance for twenty twenty four,

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<v Speaker 15>and that is what is spooking investors. And fans alike,

0:11:33.080 --> 0:11:36.520
<v Speaker 15>and what you could characterize this year twenty twenty four

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<v Speaker 15>as a transition year for Tesla, you know, all that

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<v Speaker 15>growth of the past couple of years and nothing in

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<v Speaker 15>between until next year when it releases new models.

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<v Speaker 3>Those new models include, at least according to Elon Musk

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<v Speaker 3>on the call, a new lower priced car. We've kind

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<v Speaker 3>of heard that before, haven't we.

0:11:58.720 --> 0:12:02.319
<v Speaker 15>The el Mousk has a who aspired to have a

0:12:02.520 --> 0:12:05.599
<v Speaker 15>low cost car but has never delivered. And this is

0:12:05.679 --> 0:12:09.360
<v Speaker 15>now Elon Musk for the first time with Tesla executing

0:12:09.600 --> 0:12:13.679
<v Speaker 15>on that promise. But this is still going to come

0:12:13.800 --> 0:12:17.120
<v Speaker 15>in the back end of twenty twenty five. So even

0:12:17.200 --> 0:12:19.320
<v Speaker 15>though this does come in twenty twenty five, it's still

0:12:19.440 --> 0:12:21.800
<v Speaker 15>almost like two years away from where we are now,

0:12:21.920 --> 0:12:25.640
<v Speaker 15>and it's a considerable weight for then investors having to

0:12:25.720 --> 0:12:28.160
<v Speaker 15>wait for this ramp up all the costs that go

0:12:28.320 --> 0:12:31.120
<v Speaker 15>into building up new models. As we've seen with the

0:12:31.160 --> 0:12:34.760
<v Speaker 15>struggle Tesla has with the cyber truck, it's going to

0:12:34.840 --> 0:12:37.080
<v Speaker 15>be a potential dragon earnings.

0:12:37.880 --> 0:12:39.600
<v Speaker 5>And in the meantime, the.

0:12:41.080 --> 0:12:45.720
<v Speaker 3>Ev giant has been cutting costs pretty aggressively and trying

0:12:45.760 --> 0:12:49.719
<v Speaker 3>to get past the headwind of higher interest rates. Is

0:12:49.920 --> 0:12:54.439
<v Speaker 3>there a trajectory for Tesla to continue with that strategy.

0:12:55.720 --> 0:13:00.160
<v Speaker 15>Well, Tesla has been looking to cut its costs. He's

0:13:00.160 --> 0:13:04.000
<v Speaker 15>also been cutting prices, you know, trying to lure consumers

0:13:04.120 --> 0:13:07.719
<v Speaker 15>with these obviously battling higher interest rates, So there is

0:13:07.880 --> 0:13:11.440
<v Speaker 15>always that person pull factor, and Elon's trying to find

0:13:11.800 --> 0:13:14.240
<v Speaker 15>any way which possible to make sure he's getting the

0:13:14.360 --> 0:13:17.679
<v Speaker 15>best possible costs for his product in order to be

0:13:18.000 --> 0:13:20.760
<v Speaker 15>so much more competitive when it comes to a price.

0:13:20.960 --> 0:13:23.439
<v Speaker 15>And obviously what we see right now the backdrop for

0:13:23.520 --> 0:13:27.000
<v Speaker 15>the US consumer in particular is they're not necessarily as

0:13:27.160 --> 0:13:29.760
<v Speaker 15>willing to buy new electric vehicles.

0:13:30.080 --> 0:13:32.719
<v Speaker 3>Another interesting note for Musk on the call, saying that

0:13:32.880 --> 0:13:35.079
<v Speaker 3>he might need a bigger stake in the company to

0:13:35.160 --> 0:13:38.719
<v Speaker 3>avoid being ousted as CEO. Is governance becoming more of

0:13:38.760 --> 0:13:42.800
<v Speaker 3>an issue for Tesla on the board, particularly with all

0:13:42.800 --> 0:13:44.640
<v Speaker 3>the distractions around X and whatnot.

0:13:45.800 --> 0:13:51.080
<v Speaker 15>Well, Elon Musk, you know, after buying Twitter and selling

0:13:51.160 --> 0:13:56.920
<v Speaker 15>down his shares in Tesla to fund this purchase, he

0:13:57.000 --> 0:13:59.560
<v Speaker 15>will saber rattle as much as he wants to ensure

0:13:59.600 --> 0:14:02.920
<v Speaker 15>that he potentially will get what he ultimately wants is

0:14:03.440 --> 0:14:06.720
<v Speaker 15>some form of better control, bigger controlled again of Tesla.

0:14:06.840 --> 0:14:09.120
<v Speaker 15>So I think this is a wait and see moment

0:14:09.720 --> 0:14:15.440
<v Speaker 15>whether the border seeds to his demands. But ultimately Tesla,

0:14:16.400 --> 0:14:20.280
<v Speaker 15>Elon Musk Rather is really the lynchpin in driving Tesla forward.

0:14:20.680 --> 0:14:23.840
<v Speaker 3>Of course, it's not just Tesla facing headwinds. Boeing has

0:14:23.920 --> 0:14:27.240
<v Speaker 3>the grounded seven thirty seven Max nine and now this

0:14:28.320 --> 0:14:32.280
<v Speaker 3>production freeze ordered from the FAA. It seems like the

0:14:32.400 --> 0:14:34.200
<v Speaker 3>hits just keep on coming for Boeing.

0:14:34.280 --> 0:14:40.400
<v Speaker 15>Danny, Yeah, I mean the US Federal Aviation Administration escalating

0:14:40.760 --> 0:14:44.200
<v Speaker 15>its response in the wake of the Alaska Airlines accident,

0:14:44.680 --> 0:14:47.720
<v Speaker 15>and in two parts it's partly good news for Boeing

0:14:47.800 --> 0:14:51.360
<v Speaker 15>and obviously partly very bad news. On the good side,

0:14:51.400 --> 0:14:55.840
<v Speaker 15>there is the restart of the inspections that airlines can

0:14:56.040 --> 0:14:59.120
<v Speaker 15>now look to get the grounded Max nines back into

0:14:59.200 --> 0:15:05.200
<v Speaker 15>the how the restriction on expanding production. This is all

0:15:05.320 --> 0:15:10.680
<v Speaker 15>key and very directly important to Boeing's ability to grow.

0:15:10.960 --> 0:15:15.480
<v Speaker 15>It's cash cow seventy seven Max. You all the money

0:15:15.520 --> 0:15:18.600
<v Speaker 15>that goes into delivering the revenue. It's so important. It

0:15:18.800 --> 0:15:21.320
<v Speaker 15>delivers thirty eight planes a month and it's trying to

0:15:21.360 --> 0:15:23.640
<v Speaker 15>grow that to fifty. So there's a big gap right

0:15:23.720 --> 0:15:26.880
<v Speaker 15>now into what it potentially could do in future. And

0:15:27.080 --> 0:15:30.680
<v Speaker 15>on January thirty first, Boeing is meant to be delivering

0:15:30.800 --> 0:15:34.240
<v Speaker 15>its guidance for twenty twenty four, so what effect this

0:15:34.440 --> 0:15:37.720
<v Speaker 15>has on its future outlook into twenty twenty four will

0:15:37.760 --> 0:15:38.600
<v Speaker 15>be very, very key.

0:15:40.680 --> 0:15:43.560
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