Business – Page 146

Tesla stock has plummeted since Elon Musk took over Twitter. Here’s why.

December 24, 2022 by WDNY Radio

(NEW YORK) — Tesla stock has plummeted since CEO Elon Musk took over Twitter, falling more than 45% in about over two months.

In all, the company’s stock has dropped more than 65% since January, when Musk began investing in Twitter. By comparison, the tech-heavy Nasdaq has fallen about half as far over that period.

Musk said on Tuesday that he will resign as head of Twitter when the company identifies a successor. The news temporarily buoyed Tesla stock before it again turned downward.

The electric vehicle company faces falling demand amid recession fears, heightened competition and pandemic-induced production challenges.

Moreover, some analysts and major investors have sharply criticized Musk over a perceived lack of focus on Tesla, saying the company needs leadership as it contends with an adverse business environment.

“Musk is viewed as ‘asleep at the wheel’ from a leadership perspective for Tesla at the time investors need a CEO to navigate this Category 5 storm,” Dan Ives, a longtime Tesla bull and managing director of equity research at Wedbush, said in a research note on Thursday.

“Instead Musk is laser focused on Twitter which has been an ongoing nightmare that never ends for investors, with hopes a new CEO is picked in the coming weeks as a first step forward,” Ives added.

Tesla did not immediately respond to a request for comment.

Aside from investor concerns over Musk, the company’s stock losses owe in part to insurgent rivals and diminished demand.

Tesla remains the top-selling electric vehicle company in the U.S., but its lead has slipped in recent months as competitors offer a host of affordable alternatives, a S&P Global Mobility report showed last month.

The company held 65% market share of new registered vehicles in the U.S. through the third quarter of this year, a drop from 71% last year and 79% in 2020, the report found.

Responding to weakened demand, Tesla announced on Wednesday that it would offer $7,500 discounts on Model 3 and Model Y vehicles delivered in the U.S. this month. Shares in Tesla fell by nearly 9% the following day.

Still, significant investor attention has focused on Musk and his apparent focus on Twitter.

The world’s richest person has sold nearly $40 billion worth of Tesla stock since late last year, including a $3.6 billion sale as recently as last week, as he has financed the acquisition of Twitter.

The sales have reduced the stake Musk holds in Tesla, raising questions about his continued level of involvement with the company.

Some major Tesla investors have called for Musk to place his primary focus on Tesla, which boasts a market capitalization of $392 billion, far larger than the value of Twitter, for which Musk spent $44 billion.

“I think it is in the best interest for Tesla shareholders for Elon to be back at Tesla working full time,” Ross Gerber, CEO of Gerber Kawasaki Wealth & Investment Management, tweeted on Sunday.

For his part, Musk has defended his actions at Twitter as part of an aggressive effort to rescue the company from financial peril, which he described in a Twitter Spaces interview on Tuesday as an “emergency fire drill.”

“That’s the reason for my actions,” he added. “They may seem sometimes spurious or odd or whatever.”

In a Twitter Spaces interview on Thursday, Musk vowed to stop selling Tesla stock until at least 2024, though he has previously violated commitments to halt sales of the stock. He added, meanwhile, that he hadn’t missed “a single important Tesla meeting” since acquiring Twitter.

Musk also said on Thursday that he expects the economy to fall into a “serious recession” next year, further slashing demand for expensive items.

To be sure, this year has pummeled automakers across the sector. Shares of Ford have plummeted 45% in 2022; while General Motors has fallen 43% and Toyota has dropped 26%.

Interest rate hikes at the Federal Reserve have spiked borrowing costs, making car purchases more difficult for consumers already strained by sky-high inflation. Meanwhile, pandemic-induced production bottlenecks and chip shortages have persisted, increasing costs and causing delivery delays.

In recent months, falling consumer sentiment has placed added pressure on the industry.

Despite these headwinds, Tesla can stanch its financial bleeding and turn around its business, said Ives, of Wedbush Securities.

He attributed roughly 70% of Tesla’s stock decline in recent months to Musk’s focus on Twitter, and urged Musk to return his attention to the company and stop selling Tesla stock.

“Taking a step back, the long term Tesla transformational story remains intact,” Ives said, adding that he expects global electric vehicle demand to significantly accelerate over the coming years.

Tesla, he said, is the “clear leader poised to benefit front and center.”

What can drivers expect in 2023? Dealer markups, record EV sales and massive V8s.

December 23, 2022 by WDNY Radio

(NEW YORK) — The 2022 global semiconductor crisis was maddening for motorists: record-high prices, months-long delays and hefty dealership markups. Automakers were forced to park new cars and trucks in vacant lots, unable to sell them because of missing parts or software. Consumers also watched as fuel prices reached unprecedented levels.

Interest in electric vehicles reached a fever pitch in 2022, with revolutionary models like the Ford F-150 Lightning, Kia EV6 and Hummer EV drumming up interest among consumers. Automakers also answered enthusiasts’ pleas, rolling out sports cars and hatches with manual transmissions, powerful V8s and high-revving naturally aspirated engines.

Will 2023 be a repeat of 2022? Here’s what the experts are saying:

Car prices

Consumers shopping for deals on a new vehicle in 2022 were out of luck; horror stories of fellow buyers paying $10K, $20K or $50K above MSRP were widely reported. Moreover, the average transaction price (ATP) for a new vehicle hit $47,681 in November — a record high, according to Edmunds. Monthly lease payments also jumped to $583 in November compared to $471 in November 2019.

Jaw-dropping prices, however, may finally be ending, according to Jessica Caldwell, Edmunds’ executive director of insights.

“Prices have been really high for over a year now but are starting to cool,” she told ABC News.

The average transaction price of a new vehicle in November dipped below MSRP for the first time since July 2021, she said, and prices for large trucks, SUVs and luxury vehicles have fallen in recent weeks as consumers search for budget-friendly alternatives. Rising interest rates on auto loans have also dampened demand for expensive conveyances.

“Interest rates are a big deterrent … you’re dedicating more of your income to a car payment,” she said. “This is leading to a softening of the market.”

New vehicle loans are averaging 6.6% and 10.2% for used cars, according to Edmunds data.

Ed Kim, president and chief analyst of AutoPacific, said a recession — even a moderate one — would put a dent in prices and demand next year.

“We may enter a situation where supply comes back but this time there won’t be the number of consumers to support the volume,” he told ABC News.

Inventory returns

Sparse inventory and manufacturing slowdowns turned the automotive industry upside down. Some marques like Toyota have alerted investors and customers that persistent shortages will hamper production of key vehicles in 2023.

“Chips will be a story in the first half of the year,” Tyson Jominy, vice president of data and analytics at J.D. Power, told ABC News.

Jominy, however, predicts inventory will generally rise in 2023, leading to a greater supply of vehicle choices and better prices. But too much supply could presage a return of heavy incentives and lower profits.

“Automakers are trying to be disciplined and tight with inventory,” he said.

Kim said China’s decision to relax its “zero-COVID” policy will help ease chip and supply headaches that have plagued automakers since 2020.

“We won’t be constrained in 2023 like we were in 2022,” he noted. “But there can still be a long lead time for chips — up to six to nine months until one is delivered or installed in a vehicle.”

He added, “As chip supply comes back, there will be a priority on finishing up those vehicles sitting in big, empty fields and getting them out the door to customers.”

Ultra-luxe demand

The chip shortage and ongoing pandemic did not stop high-end automakers like Rolls-Royce, Bentley and Lamborghini from selling thousands of vehicles. All three are expected to beat their sales totals from 2021, a record year for the storied brands.

“We have no slowdown in sales. Every month we’re selling more cars than we’re able to deliver,” Lamborghini CEO Stephan Winkelmann told ABC News.

Recent models like the Rolls-Royce Ghost Black Badge, Bentley Flying Spur Hybrid and Bentayga Extended Wheelbase and Lamborghini Urus S and Urus Performante have brought in new and deep-pocketed customers.

The entire luxury space did exceptionally well in 2022.

“Land Rover sold 5,116 vehicles in November with nearly no incentives. Average price paid: More than $95,000. Slow down? What slow down?” Cox Automotive said in a newsletter to clients.

Consumers who can afford six-figure vehicles are still flush with cash and will likely keep up their buying spree, Kim said.

“People at that income level are well shielded from traditional economic cycles. A recession won’t impact ultra-luxe brands,” he noted.

Enthusiast cars and big V8s

Automakers sneakily revealed a bevy a sports cars and high-performance utes that did not cater to the EV audience. There was the massive debut of the Corvette Z06, a sports car with a naturally aspirated 5.5-liter flat-plane crank V8 engine that revs to 8,500 rpm.

Manual lovers had so many new models to choose from: the Nissan Z; Toyota GR Supra, GR 86 and GR Corolla; BMW M2; Porsche 911 Carrera T; Honda Civic Type R; and Cadillac CT5-V and CT4-V Series Blackwings.

Electrification did not stop the production of thirsty V8 engines in SUVs. British automaker Aston Martin introduced its fast DBX 707, an exclusive SUV designed to give a track-like experience even on short jaunts around town. The 4.0-liter twin-turbo V8 (697 horsepower) delivers luscious acoustics and the race start launch-control function scares drivers and passengers alike.

General Motors launched its opulent Cadillac Escalade to the Escalade V Series, hailed as the “most powerful full-size SUV in the industry.” The 6.2-liter supercharged V8 in the Escalade V produces 682 hp and hustles from 0-60 mph in 4.4 seconds. There was also the all-new GMC Yukon Denali Ultimate, a seven or eight passenger SUV equipped with the latest tech, a 6.2-liter V8 and a 10-speed automatic.

Lexus opted for a V8 in its sleek IS 500 sedan and the fifth-generation Range Rover, Land Rover’s flagship SUV, has three powertrain options, including a V8.

Jominy said the maligned V8 may have a longer shelf-life than expected in an increasingly electric world.

“It’s a space where consumers are more reluctant to swap,” he said. “Anything with three or four cylinders will be replaced with an EV.”

EV market share

So many new electric vehicles were launched in 2022 that it can be hard for consumers to keep track. None, however, were Teslas. We saw electrics in a range of categories: pickup trucks (GMC Hummer EV and Ford F-150 Lightning), stylish crossovers (Audi Q4 e-tron, Kia EV6), plushy utes (BMW iX, Cadillac Lyriq, Rivian R1S) and sporty sedans (BMW i4, Taycan GTS).

The biggest story for 2023 will be the number of three-row electric SUVs on the market, Kim said. Millennials are more likely to buy an EV than Gen Xers or Baby Boomers and many millennials are now “reaching peak income and peak family raising years,” he explained.

“Right now there’s only the Tesla Model X … the market is really lacking in electric three-row products,” he said. “In the next 12 months we’ll get the Hyundai IONIQ 7, Kia EV9, VinFast VF9 and an electric Explorer. All these vehicles will address an unmet need.”

EV supply could not meet market demand in 2022. Caldwell said even more consumers will begin to shift to greener vehicles in 2023, boosting EV share from the current 5% (up from 2.5% in 2021).

“A lot of EVs are coming next year,” she said. “Chevy is doing a massive push with the Silverado and Equinox and Blazer — these are volume vehicles. More body styles are coming and so is better availability of popular models like the IONIQ 5.”

Jominy said he’s waiting to see if lower fuel prices will temper demand for EVs and how automakers respond to the Inflation Reduction Act that President Joe Biden signed into law in August.

“If you’re an automaker and don’t have a U.S. plant [that can build electric batteries] that could be tough,” he said. “But the awareness and intent to buy an EV is growing. The biggest challenge for EVs is that gasoline prices have fallen pretty precipitously.”

The decision by Tesla CEO Elon Musk to open the company’s acclaimed Supercharger network to competitors may be the real reason more consumers ditch their gas-powered vehicles for electrics, argued Kim.

“Range anxiety and charge times are still the top reasons why people don’t want to go electric,” he said. “Tesla’s biggest competitive advantage is its charging network. We’ll see a lot more automakers adopt the [North American Charging Standard], which allows, in theory, a Tesla-like charging experience.”

From giving secondhand to no gifts at all, why some parents are changing Christmas traditions

December 23, 2022 by WDNY Radio

(NEW YORK) — As families across the country celebrate this holiday season, some parents are choosing to create new traditions around gift-giving, including forgoing gifts.

For Gabrielle and Carlos Flores, that means not giving any toys to their three young children for Christmas.

“It’s more about the giving aspect of everything and not just the presents,” Gabrielle Flores told ABC News’ Good Morning America. “Let’s build a tradition so when, God forbid we’re not here, they will go and keep these traditions to their kids.”

Gabrielle Flores, of California, went viral when she shared her family’s Christmas plan on Tiktok, writing in a video that she told her children’s grandparents to only give them socks, books and education items for Christmas.

Describing her children’s reaction to knowing there will not be any toys under the Christmas tree this year, Flores said, “I really think they’re learning that Christmas is more of a holiday season about family, about traditions.”

The #NoGiftsChristmas trend is growing on social media and some celebrities, like Drew Barrymore, have said they’re forgoing buying things for their children and opting in for giving experiences.

For other parents, changing Christmas traditions come from not just a desire to help teach their children about materialism but also about protecting the environment.

ABC News chief meteorologist Ginger Zee is no stranger to taking a sustainable approach to shopping, including pledging to not buy any new clothes this year.

This Christmas, she is bringing that approach to gift-giving as a parent.

Zee said she has purchased only secondhand items for her two sons, 7-year-old Adrian and 4-year-old Miles.

“Here’s what I learned about doing secondhand gifts … they don’t have to not be new,” Zee said, pointing to a Nerf toy she plans to give her sons. “It’s probably like years old, but [they] never used it.”

How to explain different types of gift-giving to kids

Liesel B. Clark is the co-founder of the Buy Nothing Project, an online platform that establishes “gift economies” in local communities, allowing members to “gift” free reused or secondhand items to other members, a process known as “freecyling.”

She said that when it comes to secondhand gifts, children often don’t know the difference between something newly bought and something used — it is all new and exciting to them.

“If it’s new to them, they’re generally just as happy,” Clark told GMA. “There are so many families that are letting go of toys and items that their kids have outgrown, and so then that’s a wonderful way to acquire toys that are age-appropriate for your children.”

Ericka Souter, a parenting expert and author of How to Have a Kid and a Life, said there are both pros and cons to changing gift traditions at Christmas.

“Experiences foster more gratitude,” she said of the approach taken by the Flores family and others to gift only experiences. “The memories of an experience live on much longer.”

Souter continued, “Going giftless can have its drawbacks. Your kids may feel cheated out of a really fun holiday. This can be a really tough change for kids to accept.”

Souter said she recommends parents talk with their children ahead of time instead of surprising them with a change on Christmas morning.

“You want to sit them down and have a discussion with them and tell them why you are doing this,” Souter said. “But not only that, you want to tell them how this will work. So it may be that in the morning, instead of opening up a bunch of gifts, they’re going to open up the small box that will reveal what the experiences will be. Or maybe it’ll be that you all discuss a bunch of options, and then you get to pick which one goes first or what you guys do together.”

She continued, “You want to make sure that you still create some sense of mystery and excitement around going giftless.”

Souter said it’s also important to be transparent with relatives and loved ones who may want to give gifts as well.

“If you have grandparents or aunts and uncles who love sending the kids gifts, you really want to let them know the plan,” she said. “Get them on board and also give them parameters about what kinds of experiences they are supposed to give the kids.”

What buying less means for the environment

From Thanksgiving to New Year’s, the average household waste increases by more than 25%, which amounts to around 1 million extra pounds per week, according to Stanford University’s Waste Reduction, Recycling, Composting and Solid Waste Program.

According to a recent report, 5.8 billion tons of returned merchandise ends up in landfills each year and shipping returns back to retailers emit 16 million metric tons of carbon dioxide.

Clark, of the Buy Nothing Project, said that by “shopping” in your local community, you not only eliminate the waste of throwing out used items, but you also eliminate the need for packaging, wrapping paper and plastic wrap that inevitably ends up in landfills.

“There are perfectly reusable goods, right in your own community, we can create these circular economies and just keep cycling through a lot of perfectly reusable items over the years,” Clark said.

Clark said each year, for example, she makes multicolored, pillar candles using materials from her neighbors.

“I just ask them for their half-burned candles,” she said. “So that’s literally taking someone’s ‘waste,’ and turning it into something really beautiful that can be reused.”

Tips for parents to gift responsibly

Sustainable gift-giving expert Tracey Lynch, co-author of sustainable gift-giving guide Donum, spoke to Good Morning America about other ways people can reduce waste this holiday season.

She shared some tips for finding the perfect gift, without costing the environment.

Lynch said a lot starts by shifting the mindset around gift-gifting from feeling like an obligatory surprise to valuing a person’s needs and interests.

“Many times we haven’t taken the steps to learn more about the person we’re buying for. It could be our own child. It could be our spouse, it could be our sibling. It could be our parents,” Lynch said. “Our wants and needs change over time, what they may have liked before, they may not like now.”

Lynch said asking what someone wants will reduce the chance of a return.

“Santa wants to know two things. Were you a good boy or girl this year? And what do you want for Christmas?” Lynch said. “Santa’s goal is not to surprise, it is to delight.”

Lastly, Lynch said it’s important to take ownership of how, why and what you buy. She emphasized the danger of thinking of things as “disposable,” even when giving holiday gifts.

“They say, ‘It’s the thought that counts,’ but the thought is not what’s piling up in our landfills,” Lynch said. “So the thought needs to be better. The thought needs to be informed.”

Target recalls children’s weighted blankets after 2 kids died

December 22, 2022 by WDNY Radio

(NEW YORK) — Target is telling customers to stop using some weighted children’s blankets that were sold in its stores and online after four incidents where children became entrapped, two of which resulted in deaths, the U.S. Consumer Product Safety Commission announced Thursday.

A 4-year-old girl and a 6-year-old girl reportedly became entrapped in the cover of Pillowfort Weighted Blankets and died due to asphyxia at Camp Lejeune, North Carolina, in April, the CPSC said.

Target received two additional reports of children entrapped in the blankets, but those didn’t result in fatalities, according to the agency.

“A young child can become entrapped by unzipping and entering the blanket, posing a risk of death by asphyxiation,” Target said on its website.

Target sold about 204,000 of the $40-blankets from December 2018 through September 2022, CPSC said.

The id numbers to the affected blankets, which can be found on the fabric tag are: 097-02-0140 (Unicorn – White), 097-02-0148 (Space Navy), 097-02-0361(Pink), 097-02-0363 (Blue), 097-02-0364 (Gray), 097-02-1603 (Buffalo Plaid – Red), 097-02-3904 (Blue Constellation) and 097-02-3905 (Unicorn – Pink), according to CPSC.

Customers can log onto target.com for more information about the recall and how to get a refund.

Amazon and Starbucks workers led a union resurgence in 2022. Will it last?

December 22, 2022 by WDNY Radio

(NEW YORK) — Workers at Amazon and Starbucks astonished allies and adversaries this year, delivering landmark labor victories and helping inspire a resurgence of unionization nationwide.

But labor headway at the two companies has stagnated in recent months, jeopardizing the ultimate success of the campaigns and casting the continued growth of the labor movement into doubt.

The downshift in momentum at Amazon and Starbucks owes primarily to the anti-union postures and deep pockets of the corporations, labor experts told ABC News.

The setbacks could deter workers inside and outside those companies from organizing their workplaces, as they weigh the risks of confronting their bosses against the potential rewards, they said. Still, the labor movement remains galvanized by sky-high prices, a tight jobs market and near-historic public approval that should enable continued growth next year, the experts said.

“The workers are stalled at Amazon and at Starbucks,” Nelson Lichtenstein, director of the Center for the Study of Work, Labor and Democracy at the University of California, Santa Barbara, told ABC News. “The companies have a plethora of legal and administrative techniques at their command, and their greatest weapon is delay.”

Despite the challenges faced by headline-grabbing union campaigns, the surge of U.S. labor organizing will persist, he said.

“Inflation has created real pressure on people and a real sense of collective action,” he said.

In the spring, a worker-led independent group unionized a 6,000-employee Amazon warehouse in Staten Island, New York, the first-ever U.S. union at the company in its history. Since then, however, the Amazon Labor Union, or ALU, has lost two consecutive union elections at other facilities; and certification of the Staten Island victory remains tied up in legal challenges.

“There are going to be ups and downs,” said Seth Goldstein, a lawyer at Julien, Mirer & Singla, who represents the ALU. “It’s a marathon.”

Starbucks workers, meanwhile, unionized more than 260 stores this year but the pace of union elections has fallen significantly and workers have yet to sign a union contract at a single location.

Over the first half of 2022, the National Labor Relations Board received union election petitions from an average of 47 Starbucks stores per month; but over five months ending in November, that election rate dwindled to 11 stores per month, according to data from the NLRB, a federal agency that oversees union elections.

Neither Amazon nor Starbucks responded to a request for comment.

“One of the big effects of Amazon and to some extent Starbucks organizing is it has encouraged other workers to raise their voices and think, ‘oh gee, maybe a union works for us, let’s try to get one,'” Thomas Kochan, a labor researcher and professor emeritus at the MIT Sloan School of Management’s Institute for Work and Employment Research, told ABC News.

“Workers are now looking around and saying, what’s the use of that?” he added. “If they can’t get a contract why should we go through with all this?”

Defying the apparent loss of momentum at Starbucks and Amazon in recent months, however, a surge in union organizing across the economy has sustained itself.

Over a year-long period ending in September, petitions for union representation jumped 53%, NLRB data showed. Moreover, this year labor unions reached their highest level of public support in the U.S. since 1965, a Gallup poll showed.

The resurgence of union organizing is especially stark in light of a decades-long labor decline that brought the private sector union rate to a record low of about 6% last year, government data showed.

Sara Beth Ryther, an employee at a Trader Joe’s in Minneapolis that unionized in August, said workers at the store draw inspiration from the campaigns at Starbucks stores nearby.

“When we go to Starbucks stores that are unionized around us, we see actions being taken in the workplace and we read about them in the newspaper,” she said. “I think it’s preserving this energy in a way that maybe hasn’t been the case in the past.”

“It’s really important for folks to know how unified many of these labor movements are,” she added.

Across the economy, the sense of company neglect for worker well-being that gave rise to pandemic-era organizing has continued to drive action, Michelle Eisen, a Starbucks employee at a store in Buffalo, New York that organized in December, told ABC News.

Eisen acknowledged setbacks faced by workers nationwide in the Starbucks campaign, citing anti-union efforts undertaken by the company. While those tactics may have dissuaded some workers, they’ve motivated others, she said.

“There’s always a chance some people will say, ‘You know what, this is exhausting and I can’t keep doing this,” said Eisen, a spokesperson for Starbucks Workers United, a labor union. “But I think what we’re seeing is more people willing to fight anyway.”

Sam Bankman-Fried lands in US after being extradited from Bahamas

December 22, 2022 by WDNY Radio

(NEW YORK) — Sam Bankman-Fried has landed in the U.S. to face federal charges after agreeing to extradition in a Bahamian court on Wednesday.

The disgraced former CEO was put on a U.S. government plane for a flight to New York. He landed in Westchester County Airport.

“I hereby consent in writing to be extradited without formal extradition proceedings,” Bankman-Fried said in a signed affidavit in the Bahamas earlier Wednesday.

He took the witness stand to confirm his signature and that his decision was voluntary.

“I therefore formally commit you to custody while you await your extradition,” Magistrate Shaka Serville said.

The Bahamian Foreign Ministry said the foreign minister signed the warrant of surrender, which allowed the extradition.

The move came a day after Bankman-Fried signed extradition papers in the Bahamas, where he lived in a multimillion-dollar mansion, after waffling on the decision since his initial court appearance last week.

Bankman-Fried was arrested last week in the Bahamas after federal prosecutors in New York filed an eight-count indictment including allegations of fraud and conspiracy.

He had been expected in court Tuesday but did not appear, even as his lawyers and U.S. consular officials waited for two hours.

At a court hearing last week, Bankman-Fried declined to waive his right to challenge extradition to the U.S. However, multiple sources familiar with the matter told ABC News ahead of a court hearing on Monday that Bankman-Fried had reversed his position and was prepared to waive extradition, setting up a move to custody in the U.S.

At the court hearing on Monday, however, Bankman-Fried did not waive his right to deny extradition as expected, instead asking to see a copy of the U.S. indictment and speak to his New York-based attorney.

Bankman-Fried has been held in the medical ward of the island’s Fox Hill prison, after an application for bail was denied when a judge determined he was too much of a flight risk.

In addition to the criminal charges, Bankman-Fried faces related civil lawsuits from the Securities and Exchange Commission and the Commodity Futures Trading Commission.

There are more than $8 billion in customer losses, said Gretchen Lowe of the Commodity Futures Trading Commission, a federal agency.

Some crypto traders, who deposited their savings on the platform, fear they may never get their money back.

John Ray, the new CEO of FTX, who oversaw the dissolution of Enron, told members of the House last week that FTX lacked corporate controls to an extent he had never witnessed, characterizing the company’s conduct as “old-fashioned embezzlement.”

“I’ve never seen an utter lack of record keeping,” Ray said. “Absolutely no internal controls.”

Bankman-Fried, in an interview with ABC News’ George Stephanopoulos in November, denied knowing “there was any improper use of customer funds.”

“I really deeply wish that I had taken like a lot more responsibility for understanding what the details were of what was going on there,” Bankman-Fried told Stephanopoulos. “A lot of people got hurt, and that’s on me.”

Does Elon Musk’s resignation from Twitter mean he’ll give up control? Experts weigh in

December 22, 2022 by WDNY Radio

(NEW YORK) — Elon Musk vowed to resign as the head of Twitter but he will remain a dominant force at the company, some management experts told ABC News.

The billionaire entrepreneur, who owns Twitter, said on Tuesday that he will step down as soon as the company identifies a successor. The move follows a Twitter poll in which a majority of users called on Musk to stop leading the company.

However, he will retain control over the software and server departments, important teams that will grant him significant control over how the social media platform operates.

The authority afforded by ownership of the company, as well as Musk’s longstanding reluctance to delegate key tasks, will result in decisions dictated largely by his preferences, the experts said.

The company, which lacks a board of directors, will likely hire a hand-picked successor with views that align closely with Musk’s and a public profile that is vanishingly small by comparison, they added.

“It will be Elon’s impulse to jump in and say, ‘It’s my money at stake, it’s my reputation at stake — I have to be a part of every decision,” Peter Harms, a professor of management at the University of Alabama who has studied corporate leadership, told ABC News.

“He has shown no inclination to delegate authority with his businesses,” Harms added.

Twitter did not immediately respond to a request for comment.

‘Window dressing’

Since he acquired Twitter, Musk has made dramatic changes. He fired top executives and cut the company’s 7,500-person workforce in half, while reinstating some formerly suspended accounts such as that belonging to former President Donald Trump.

He also revamped Twitter’s subscription service, Twitter Blue, allowing users to access verification if they pay a monthly fee of $8. The service was suspended after it gave rise to a flood of fake accounts impersonating public figures and brands. It has since been relaunched.

In an interview on Twitter Spaces on Tuesday, Musk defended the moves as part of an aggressive effort to rescue Twitter from financial peril, which he described as an “emergency fire drill.”

“That’s the reason for my actions,” he added. “They may seem sometimes spurious or odd or whatever.”

Musk, who admitted he overpaid for the platform at the purchasing price of $44 billion, said last month that the company was losing $4 million a day.

In his latest eye-catching move, Musk posted a poll on the platform asking users whether he should resign. The poll ended Monday morning, with 57.5% of voters saying he should step down and 42.5% saying he shouldn’t.

After a day of silence about the results, Musk announced that he would ultimately step down. By retaining control of key product teams, however, Musk will remain heavily involved in overseeing the company, experts said.

“It feels like window dressing,” Sandra Sucher, a professor of management at Harvard Business School, told ABC News. “He can appear to be responding to the vote to get him out, but I think it’s somewhat disingenuous because he’s going to maintain operational control over a big portion of the business.”

“There’s no question that he will remain the de facto head,” she added. “As far as concerns over decision making and the way he’s shaping the business to reflex his own personal views, it’s unclear what this change will do.”

Growing pressure over losses at Tesla

Musk, who also runs electric vehicle company Tesla, has faced growing pressure to return his focus to the automaker. The company’s stock has fallen 60% this year, as it faces heightened competition and pandemic-induced production challenges.

Musk’s resignation “has become a necessity because of the hemorrhaging at Tesla,” Jeffrey Sonnenfeld, a professor of management at Yale University who convenes gatherings of top CEOs, told ABC News.

While Musk will remain atop Twitter for the foreseeable future, he may end up distancing himself from the company in order to prioritize the comparatively massive automaker, which boasts a market capitalization of nearly $440 billion, Sonnenfeld said.

In fact, Musk tried to avoid taking control of Twitter in the first place. He tried to pull out of the deal to buy the company but went through with the acquisition after Twitter brought a lawsuit forcing the acquisition.

“He became CEO by default because he lost the lawsuit,” said Sonnenfeld, of Yale University. “He didn’t really want to be CEO.”

A potential successor

Despite the need for a steady hand at Tesla, Musk will find it difficult to disengage from day-to-day operations at Twitter, said Harms, of the University of Alabama.

“He’ll struggle to relinquish control,” he said.

A successor, Harms said, would need to implement Musk’s vision for the company and allow Musk to take credit, leaving little opportunity for dissent.

The current dynamic atop Twitter — a visionary leader in need of a logistics-oriented partner — has come about in the industry on multiple occasions, Harms said, pointing to former Apple CEO Steve Jobs and his then-second-in-command Tim Cook.

In another case, Meta CEO Mark Zuckerberg hired Chief Operating Officer Sheryl Sandberg to handle the company’s advertising business, on which it relies for revenue.

“Elon Musk needs his Tim Cook,” Harms said.

Sam Bankman-Fried agrees to extradition, clearing path for transport to US

December 21, 2022 by WDNY Radio

(NEW YORK) — Sam Bankman-Fried agreed to extradition in a Bahamian court on Wednesday, clearing the way for his transport to the U.S. to face federal charges.

The disgraced former CEO is expected to be put on a U.S. government plane for a flight to New York.

“I hereby consent in writing to be extradited without formal extradition proceedings,” Bankman-Fried said in a signed affidavit.