Read It And Eat 12/03

Welcome to ‘Read it and Eat’ — your go-to for bite-sized updates on corporate actions in finance, AI and anything I consider newsworthy. Join me twice a week for quick reads, where I serve up the latest insights that matter in the world of business.

Major Headlines:

• Walmart GPT:

• Walmart seems to be accelerating the advancement of its AI capabilities. According to a VP of the company, there will “be a big a shift as mobile in terms of how our customers are going to expect to interact with us.” Walmart is using GPT-4 to go farther in natural language understanding, at scale, than ever before. That includes boosting existing offerings such as Text to Shop, which allows customers to add Walmart products to their cart by texting or speaking the names of the items that they need. [Venture Beat]
  

• Nvidia is about to overtake Apple as the second most valuable company:

• Nvidia is well on track to become the second most valuable company. The semiconductor and chip maker has ridden the AI wave to incredible profitability and an all-time high valuation. It was just under a year ago when the company crossed the trillion-dollar valuation and now, within nine months it has gone from $1tn to $2t, overtaking Amazon, Alphabet [Google’s Parent Company and Saudi Aramco, is on track to beat Apples valuation of $2.61tn landing it just under Microsoft’s $2.98tn valuation. [Reuters]
  

• POTUS indicates he may ban TikTok:

• Legislation passed through the US House Energy and Commerce Committee unanimously on Thursday calling on China’s Byte Dance to divest its ownership of TikTok or effectively face a ban within the country. It is to come up for a vote in the House. When asked about the legislation by reporters Biden said “If they [House] pass it, I’ll sign it.” The White House had provided technical support in the drafting of the bill and has said the legislation “Still needs some work” to get to a place where POTUS would endorse it. [Sky News]
  

• More Americans are reaching into their 401(k)s:

• A record number of Americans took money out of their 401(K) plan last year for a financial emergency, stark new figures reveal. Data from Vanguard Group, one of the largest US retirement plan providers, reveals that 3.6% of participants took early withdrawals from their accounts in 2023. It is the second year in a row that emergency withdrawals have hit record highs, as higher costs for everything from groceries to gas and soaring interest rates have taken their toll on households. In 2022, around 140,000 — or 2.8% of participants — took emergency withdrawals from Vanguard 401(K) accounts. [Wall Street Journal]
  

Minor Headlines:

• Telegram hits 900 million users and nears profits says founder with IPO on the horizon. [Yahoo Finance]

• Bitcoin surpasses silver to become the eighth-largest financial asset financial asset by market capitalisation. [The Block]

• News Corp and The Daily Mail to acquire The Telegraph. [Bloomberg]

• Biden’s new budget includes an increase in Corporation Tax. [Wall Street Journal]

• U.K. Retail Broker Etoro is considering choosing New York and not London for IPO. [Financial Times]

• BP’s carbon emissions rise for the first time since 2019. [Reuters]

• Big companies open up regional HQs in Saudi Arabia to be compliant with the Kingdom’s demands. [Financial Times]

• POTUS State of the Union address was… interesting. [New York Times]
  

NEWS OF THE DAY:

With An Embattled Reputation And Increased Lawsuits, Boeing Allegedly Employs a Few Tactics From The CIA Mafia

Between the Royal Family and all that is going on there with Kate Middleton and her Photoshop Saga and Boeing and all the hits to their manufacturing reputation, from exploding door plugs to a tyre flying off their airplane during takeoff both the British and American institutions are facing the consequences of their own actions.

It used to be “If it ain’t Boeing, I ain’t going” in a popular television ad and company slogan to show the public trust for Boeing it was known for hiring the smartest aerospace engineers in the industry. However, shareholder greed, and an incessant desire to cut corners and operate on barebones expenses and budget, to artificially drive up profits, they end up cutting important things such as maintenance checks, laying off maintenance crew, contracting and subcontracting quality control staff and spinning off and selling Spirit AeroSystems, have caused a short term rise in quarterly returns for the company but in the long term has marred their reputation with scandals and devastated the leadership team and also the regulators that were meant to regulate them in lawsuits.

The duopoly in the industry, between Boeing and Airbus has made this particularly frightening for the everyday user. When the news broke about the door plug of the Alaskan Air Boeing plane blasting off mid-flight in January, it’s been a whirlwind of problems that even I am struggling to keep up with. Just two days ago an Air Alaskan flight arrived at Portland International Airport with the cargo door open, a fault from the manufacturer, at the same time a United Airlines flight was forced to make an emergency landing in California after a tyre fell off during takeoff, damaging not only the several cars and the structure of the parking lot of the San Francisco Airport, but further damaging the company’s already battered reputation. They also have a looming $1Bn class action lawsuit headed their way.

You would think the worst is behind them, however, just yesterday, it got eerily worse for the company. A former Boeing employee known for raising concerns about the firm’s production standards has been found dead in the US. John Barnett had worked for Boeing for 32 years, until his retirement in 2017. It said the 62-year-old had died from a “self-inflicted” wound on 9 March and police were investigating. In the days before his death, he had been giving evidence in a whistleblower lawsuit against the company. In 2019 Mr Barnett told the BBC that under-pressure workers had been deliberately fitting sub-standard parts to aircraft on the production line. He also said he had uncovered serious problems with oxygen systems, which could mean one in four breathing masks would not work in an emergency. He said soon after starting work in South Carolina he had become concerned that the push to get new aircraft built meant the assembly process was rushed and safety was compromised, something the company denied. He later told the BBC that workers had failed to follow procedures intended to track components through the factory, allowing defective components to go missing. Mr Barnett said he had alerted managers to his concerns, but no action had been taken.

Boeing denied his assertions. However, a 2017 review by the US regulator, the Federal Aviation Administration (FAA), did uphold some of Mr Barnett’s concerns. It established that the location of at least 53 “non-conforming” parts in the factory was unknown and that they were considered lost. Boeing was ordered to take remedial action On the oxygen cylinders issue, the company said that in 2017 it had “identified some oxygen bottles received from the supplier that were not deploying properly”. But it denied that any of them were actually fitted on aircraft. After retiring, he embarked on a long-running legal action against the company. He accused it of denigrating his character and hampering his career because of the issues he pointed out — charges rejected by Boeing. At the time of his death, Mr Barnett had been in Charleston for legal interviews linked to that case. He had been due to undergo further questioning on Saturday. When he did not appear, enquiries were made at his hotel. He was subsequently found dead in his truck in the hotel car park. The police are investigating the case now to see if there is any foul play but Mr Barnett’s death seems eerily convenient for Boeing.

GEN-Z Word Of The Day

It’s Giving:

As a noun, it means something is cute or used to define an action that’s really unique or amazing. It can also be used as a qualitative verb to draw similarities between two things.

Examples

Noun: “I love your outfit! It’s Giving!”

Q. Verb: “The star witness against Boeing committing suicide in the Middle of the trial? It’s Giving CIA Mafia”