Good morning.
It’s feedback Friday. Lots of response to yesterday’s post on the Crisis in Leadership. A sampling:
From GW: “I am extremely disappointed that our country’s leadership is squandering this unique opportunity to implement positive change in the business and regulatory landscape.”
From SG: “As a very proud Republican who did not vote for the current resident of our country’s most important job, I am just utterly shocked to see an individual who has spent his entire adult business life focused on and cultivating his personal leadership and brand name, proceed to flush it 100% down the toilet in a matter of a few months.”
From TP: “What we are witnessing is the manipulation of public opinion by political forces intending to weaken the President. This isn’t new, the same forces worked against Obama…There is plenty of blame for Trump, but I am rooting for his disruptive behavior to shift the current political balance off its axis. Things are so broken in Washington.”
From BM: “For as many requests as you get to ‘keep politics out of business,’ I hope you receive double the requests to keep doing what you are doing.’”
From BR: “I hope others, like you, will continue to lead, from the middle, but also take a stand when there is no middle.”
And from EG: “You are a laughable political apologist. Do us a favor and resign.”
No such favors today. Enjoy the weekend. News below.
Alan Murray
@alansmurray
alan.murray@fortune.com
Top News
• Markets Tumble as Growth Hopes Fade
The Dow had its worst day in three months as confidence in the administration’s ability to push through growth-enhancing reform faded. The president’s council on infrastructure, emblematic of what markets had been hoping for, went the same way as his CEO advisory council Thursday. Sentiment was also hit by news of two terror attacks in Spain, although they had no material impact on market fundamentals. The move supported arguments, heard increasingly often, that the long bull market is rapidly losing conviction, despite the evident reluctance of central banks to kill it for good by tightening policy too quickly. Bloomberg
• Wal-Mart’s Investments Pay Off
Wal-Mart’s second quarter earnings beat expectations, as heavy investment in its online strategy paid dividends. Comparable sales at its U.S. stores rose 1.8% on the year, while footfall also increased in response to a range of initiatives designed to encourage online shoppers to keep visiting physical stores. The bottom line was also helped by improved performance at its overseas units and even at chronic underperformer Sam’s Club. Fortune
• Infosys CEO Quits After Pressure From the Wings
Infosys CEO Vishal Sikka has stepped down with immediate effect, after months of sniping from former executives unhappy at the direction Sikka was taking the company in. It’s been his misfortune to inherit a situation where the U.S. market, Infosys’ largest, has suddenly become much more complicated due to the new administration’s attitudes to visas for its largely Indian workforce. COO Pravin Rao will be interim CEO, and Sikka will stay on as vice chairman until a permanent CEO is found. Fortune
• From Bad to Worse at Ericsson
Mobile networks equipment maker Ericsson may slash its workforce by nearly a quarter—some 25,000 jobs in all—in what would be a dramatic expansion of its cost-cutting efforts. The next big investment cycle for mobile carriers, an upgrade to 5G networks, is still years away, and emerging markets—a key prop to growth for many years—are getting tougher due to competition from the likes of Huawei. The company had warned it would cut faster and more deeply after missing expectations in the second quarter. Ericsson has announced 3,000 job cuts already. However, it didn’t confirm the Svenska Dagladet report. Reuters
Around the Water Cooler
• To Succeed Like John Pierpoint, Vacation Like John Pierpoint
Hands up those who think three months spent vacationing every year is impossible. Keep your hand up if you think John Pierpoint Morgan was a successful businessman. All those with their hands still up, click here to read Leigh Gallagher’s story on how the Wall Street titan thought he “could do a year’s work in nine months, but not in twelve months.” In fact, everyone else should read it too. Fortune
• Ford’s Hackett Changes Lanes on Autonomous Vehicles
Ford Motor’s new CEO Jim Hackett told The Wall Street Journal that the company is rethinking how customers will use autonomous driving technology. He still wants Ford to have a fully self-driving car on the roads by 2021, but stressed that it will be a very different beast from the station wagon it replaces. “It’s about aligning the technology to what the market wants it to do—is it a new station wagon or is it an Uber vehicle?” Hackett said at a company event. WSJ, subscription required
• Blown Over, or Overblown?
Shares in Vestas Wind Systems, the world’s biggest maker of wind turbines, fell 8% after it warned of shrinking margins—a reflection of increased price pressure in China. Neither a healthy rise in orders and backlogs nor the announcement that it will buy back nearly 9% of its stock cushioned the fall. The development makes it all the more important to the Danish company that it continues its current run of success in the U.S., where it has nearly half the market and competition from Chinese rivals is less acute—but where it also faces a patent lawsuit from GE, which sued it for improperly using its technology earlier this month. FT, metered access
• Murdoch Joins Chorus of Trump Critics. No, the Other One.
James Murdoch, CEO of 21st Century Fox, pledged to donate $1 million do the Anti-Defamation League, in response to the Charlottesville violence and the ensuing fallout. In an e-mail to friends obtained by the Hollywood Reporter, Murdoch wrote “[W]hat we watched this last week in Charlottesville and the reaction to it by the President of the United States concern all of us as Americans and free people.” His comments contrast with the more sympathetic attitude to the White House shown by Fox News and conservative commentators. They illustrate the tension between the editorial direction of the network, which has been the foundation for its commercial success, and the outlook of its new head, who is also known for being a convinced environmentalist and, in recent months, for leading a crackdown on institutionalized sexism at Fox. Fortune
Summaries by Geoffrey Smith geoffrey.smith@fortune.com
@geoffreytsmith
