The daily business briefing: November 2, 2017
Facebook reports soaring profits, the Federal Reserve leaves interest rates unchanged, and more
Facebook reports soaring profits
As Facebook faced criticism on Capitol Hill for failing to keep Russian political ads from influencing voters, the social network reported that its quarterly profit soared by 79 percent and revenues jumped by nearly 50 percent. The gains came as ad sales grew thanks to the company's ability to target users. That ability has been spotlighted by the Russian election meddling scandal, in which Russia-linked accounts placed ads seeking to divide Americans. Facebook CEO Mark Zuckerberg said that the company's commitment to keeping "problematic content" off its site will cut into profits, but, "Protecting our community is more important than maximizing our profits."
Fed leaves interest rates unchanged as nomination looms
The Federal Reserve left interest rates unchanged on Wednesday at the close of a two-day meeting, stressing that economic and job growth remained solid. Fed policy makers played down negative impact from the summer's devastating hurricanes. The statement, which followed expectations, suggested that the Fed remained on track to make its third gradual interest rate hike of the year at its December meeting. The meeting wrapped up a day before President Trump is expected to announce that he is nominating Fed Governor Jerome Powell to replace Fed Chair Janet Yellen, whose term ends in February. Powell has supported Yellen's careful approach to raising interest rates and unwinding other monetary policies the central bank used to help boost the economy after the Great Recession.
Trump calls for last-minute changes to GOP tax plan
President Trump called for last-minute changes to the House Republican tax bill on Wednesday, as GOP tax writers were rushing to complete it in time to unveil it on Thursday. Trump reportedly is pushing to name the proposal "The Cut Cut Cut Act," which Republican leadership has resisted. He also said on Twitter that the GOP should address an Affordable Care Act fix in the bill. "Wouldn't it be great to repeal the very unfair and unpopular individual mandate in ObamaCare and use those savings for further tax cuts," Trump tweeted. Trump also said he would blame his treasury secretary, Steven Mnuchin, and national economic council director, Gary Cohn, if the tax plan fails. Disagreement over corporate tax cuts weighed on U.S. stocks early Thursday.
Warner Brothers severs ties with Brett Ratner after sexual misconduct allegations
Warner Brothers cut ties with director-producer Brett Ratner after six women, including actresses Natasha Henstridge and Olivia Munn, accused him of sexual assault and harassment. Henstridge said that in the early 1990s, when she was a 19-year-old fashion model and he was an up-and-coming music video director, she fell asleep watching a movie on his couch with others. She said she woke up alone with Ratner, who blocked the doorway and forced her to perform oral sex. "He physically forced himself on me," she said. "At some point, I gave in and he did his thing." Ratner's lawyer denied the allegations. Ratner said he decided to "step away" from Warner Bros. projects until his personal issues are resolved to avoid "negative impact to the studio."
Tesla shares drop as losses grow
Tesla on Wednesday reported its biggest quarterly loss ever and pushed back its target for ramping up production of its first mass-market car, the new Model 3 sedan, by about three months. The electric-car maker said it was still working on fixing production bottlenecks, and couldn't say for sure how long that would take. The company had aimed to be cranking out 5,000 of the $35,000 Model 3 sedans by December, but now says it probably won't reach that production level until late in the first quarter of 2018. The company's shares dropped by nearly five percent in after-hours trading, as investors digested the news that it lost more than expected during the third quarter.