Elite law firms send a message
With universities across the United States grappling with a rise in antisemitism since the start of the Israel-Hamas war, elite law firms are putting schools on notice. In a letter to some of the nation’s top law schools obtained by DealBook, about two dozen major Wall Street firms warned that what happens on campus could have corporate consequences.
“We look to you to ensure your students who hope to join our firms after graduation are prepared to be an active part of workplace communities that have zero tolerance policies for any form of discrimination or harassment, much less the kind that has been taking place on some law school campuses,” the firms wrote.
Among the firms that signed the letter are:
Cravath, Swaine & Moore
Debevoise & Plimpton
Kirkland & Ellis
Paul, Weiss, Rifkind, Wharton & Garrison
Simpson Thacher & Bartlett
Wachtell, Lipton, Rosen & Katz
Another signatory, Davis Polk & Wardwell, last month rescinded job offers over letters blaming Israel for the Oct. 7 Hamas attack.
The letter follows a series of recent antisemitic episodes at universities. Gov. Kathy Hochul of New York sought this week to reassure Jewish students at Cornell after online posts threatening violence against them. Students at other schools have said they feel increasingly unsafe amid rallies and other acts that, in some instances, have become violent.
And school leaders have been criticized for equivocating in their responses to both the Oct. 7 Hamas attacks on Israel and to antisemitism more broadly. (The University of Pennsylvania, which has faced a donor revolt, on Wednesday announced measures that include a task force on antisemitism.)
Big Law carries huge clout. Students at the schools that received the letter — 14 top institutions, along with others that have strong ties with the signatories — compete aggressively for jobs at the firms after graduation. And deans keep a close eye on job placement statistics.
School officials “were late to getting that Jewish students are actually scared — they feel threatened, and they feel betrayed,” Joe Shenker, the senior chair of Sullivan & Cromwell who spearheaded the letter, told DealBook.
Many firms say that on-campus statements matter beyond school, especially as students graduate to client-driven businesses. The firms behind the letter urged schools to take this more into account when formulating academic policies.
“It is imperative that you provide your students with the tools and guidance to engage in the free exchange of ideas, even on emotionally charged issues, in a manner that affirms the values we all hold dear and rejects unreservedly that which is antithetical to those values,” they wrote.
The DealBook Summit is on Nov. 29. Among the guests are Elon Musk of SpaceX, Tesla and X; Representative Kevin McCarthy, the former House speaker; and David Zaslav of Warner Bros. Discovery. You can apply to attend here.
HERE’S WHAT’S HAPPENING
Can Apple snap its sales slump? That will be the big question on Thursday as the iPhone maker, which has seen revenues fall in each of the past three quarters, reports results. Its stock has fallen more than 11 percent since July amid a larger decline in tech shares.
Disney will take full control of Hulu. The entertainment giant will buy Comcast’s 33 percent stake in the popular streaming service. But at what price? Disney said it would pay at least $8.6 billion, but Comcast thinks it can fetch more.
The Sam Bankman-Fried trial goes to the jury. Closing arguments in the crypto fraud case wrapped up on Wednesday. The 31-year-old faces the equivalent of a life sentence if convicted of fraud, conspiracy and money laundering charges for his role in the collapse of FTX, the cryptocurrency exchange he founded. He has pleaded not guilty.
Uber and Lyft will pay $328 million to settle New York wage-theft accusations. The ride-hailing companies were accused of unlawfully withholding drivers’ pay and not providing mandatory paid sick leave. Uber will pay $290 million and Lyft $38 million.
Investors like what they heard from the Fed
Stocks point to modest gains on Thursday amid investors’ hopes that the Fed is done raising interest rates.
That said, at a news conference on Wednesday, Jay Powell, the Fed chair, made no such declaration. In fact, Fed policymakers have left open the possibility for another increase, and some economists are sticking with their forecasts of another rate rise.
But, for now, the bulls are leading the way.
The futures market has slashed the odds for an interest-rate increase at next month’s meeting to roughly one in four — down from the 40 percent level before Wednesday’s Fed decision to hold rates unchanged, according to Bloomberg. That optimism has seen investors pour back into stocks and bonds.
The S&P 500 has rallied over three straight days, and yields on the 10-year Treasury dipped nearly 0.20 percent at one point on Wednesday, the best performance for T-bills since March, according to Deutsche Bank. (Bond yields fall when prices rise.)
Powell signaled that the Fed would proceed “carefully.” Some Fed watchers see that as proof that the central bank will hold off on raising rates to try to limit damaging the economy as it battles to bring down inflation.
The bond market may be doing some of the Fed’s job. Yields have risen recently, pushing up borrowing costs for consumers and businesses. “That will throw more sand in the economy’s gears without the Fed raising rates again,” Bill Adams, Comerica’s chief economist, wrote in an investor note on Wednesday. (Comerica is in the hold-steady camp.)
Aditya Bhave, an economist at Bank of America, is leaning the other way, maintaining a prediction for a rate rise of a quarter-percentage point in December.
Up next: The Labor Department releases jobs data on Friday, with economists forecasting that payrolls increased by 170,000 last month. A hotter-than-expected number could reverse calls that the Fed is done raising rates.
Splits cloud Britain’s A.I. summit
The British government’s artificial intelligence safety summit was billed as the first event to bring global policymakers, companies and researchers together to try to establish guardrails.
But the Biden administration’s decision to announce its own safety initiative and a schism between leading A.I. developers highlight the difficulty in reaching an international consensus.
The U.S. may have upstaged the effort. Gina Raimondo, the commerce secretary, said on Wednesday that the American safety institute would “develop best-in-class standards” for regulating A.I. safety and security.
And Vice President Kamala Harris stole some of the spotlight before the meeting started by announcing details of how Washington would regulate A.I. after President Biden’s order requiring companies to assess national security risks before releasing their technology to the public.
The summit yielded some accomplishments. Twenty-eight governments, including the U.S. and China, signed a declaration to cooperate on A.I. risk management. They also agreed to hold a second meeting in six months in South Korea and a third in France in a year. But critics said the communiqué lacked specific policy goals.
On the plus side: The signatures by Beijing and Washington were a rare collaboration by governments at odds over practically everything from tech to trade.
A spat between leading A.I. developers has burst into public view. Yann LeCun, Meta’s top A.I. scientist who backs open-source development, accused Google, OpenAI and others at the summit of “fear-mongering” to ensure that only a small number of companies dominate the commercial A.I. market and influence how it gets regulated.
Demis Hassabis, the C.E.O. of Google DeepMind, countered that it’s important to push for regulation as early as possible. “I pretty much disagree with most of those comments from Yann,” he told CNBC.
On deck for Thursday: Elon Musk, who is attending the summit and has warned about A.I.’s risks, will participate in an interview with Rishi Sunak, the British prime minister, on X after the event.
“What was he even talking about?”
— Bill Ackman, after interviewing his fellow hedge fund mogul Ray Dalio onstage about the investment philosophy of Dalio’s firm, Bridgewater Associates.
Workers make, and push for, gains outside unions
After the United Automobile Workers won big increases in pay and benefits following its bare-knuckled strike campaign against the big Detroit automakers, some analysts wondered whether nonunionized car producers would have to follow suit.
The answer, at least in one instance, is yes. It’s a reflection of how aggressive moves by labor unions are rippling across industries.
Toyota increased salaries for most of its U.S. factory workers by 9 percent, just days after General Motors became the third of the Detroit Big Three to reach a deal with the U.A.W. The Japanese car giant also pledged to shorten the amount of time it takes employees to reach maximum pay and to provide more paid time off, both of which mirrored gains made by the union.
A Toyota spokesman said the move was part of regular compensation reviews “to ensure that we remain competitive within the automotive industry.”
Worth noting: The U.A.W. said it would seek to organize the factory workers at nonunion shops including Toyota and Tesla.
Workers elsewhere are flexing their muscle, seemingly inspired by the U.A.W. and Hollywood unions. Nonunionized pharmacy employees at CVS and Walgreens stores are calling in sick or walking off the job to protest what they say are poor work conditions. The move is being called “Pharmageddon” on social media.
And in Bangladesh, the world’s second-biggest clothing producer after China, thousands of garment factory workers have taken to the streets to call for higher wages.
THE SPEED READ
The European private equity firm CVC has delayed plans to go public as more companies push back I.P.O. efforts amid jittery markets. (FT)
Apollo Global Management will rework the compensation of four top leaders, giving them $550 million worth of shares to make their pay more contingent on its stock’s performance. (FT)
The amusement park operators Cedar Fair and Six Flags agreed to merge, creating a company valued at about $8 billion, including debt. (Cedar Fair and Six Flags)
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