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Trump’s trade war with China could start weighing on the biggest engine of the US economy

Black Friday shoppersTom Pennington/Getty Images

  • The US-China trade war could soon push consumers to reduce spending, according to a new Bank of America Merrill Lynch consumer-confidence analysis.
  • The closely watched University of Michigan consumer-sentiment index rose to a 15-year high last week — but that data was collected before the latest trade-war escalation.
  • Visit Market Insider’s homepage for more stories.

President Donald Trump’s trade war with China has already shaken consumer sentiment and rattled global financial markets. A new analysis from Bank of America Merrill Lynch suggests it could hit consumer spending next.

BAML’s consumer-confidence indicator slipped from what had been a rebound through the beginning of the month as US consumers reacted to the latest trade-war escalation, the firm said in a report to clients dated Friday.

A further downturn in confidence could have implications for consumer spending, which makes up 68% of the US’s gross domestic product, according to the Federal Reserve Bank of St. Louis.

“Confidence shocks matter,” BAML’s economists wrote. “Keep a close eye on confidence indicators. A protracted trade war could have a meaningful impact on consumer spending.”

Bank of America's consumer confidence indicator.Bank of America Merrill Lynch

The indicator’s recent downturn moved in tandem with the recent trade-war developments, BAML wrote.

“The confidence indicator started to slip lower on May 11th, coinciding with the announcement that the US will raise tariffs on imports from China to 25% from 10%,” the firm said. “Digging into the details we see that the deterioration in confidence was driven by a decline in both current conditions and expectations.”

On a more granular level, the current-economic-expectations indicator had rebounded back to its recent multimonth high before the latest trade development. Now, a short-term trade dispute could have a “meaningful, albeit temporary,” impact on spending, the firm noted.

Just look at what happened during the partial federal government shutdown earlier this year, which caused about half of its respondents to report some kind of pullback in spending, BAML said. That coincided with a pullback in sentiment.

Bank of America's question about consumer spending.Bank of America Merrill Lynch

Different measures of consumer confidence have vacillated in recent months as trade-related uncertainty weighs.

Take the closely watched University of Michigan Index of Consumer Sentiment, which soared to a 15-year high last week. While on its face the reading seems to suggest consumers have confidence in a trade resolution between Washington and Beijing, it is important to note that it was conducted before the latest escalation.

“The gains were recorded mostly before the trade negotiations with China collapsed and China responded with their own tariffs,” Richard Curtin, the Michigan consumer survey’s chief economist, said in a release. “Nonetheless, the data indicate the corrosive impact of an escalating trade war.” The next University of Michigan reading is expected May 31.

Read more: US consumer sentiment rises to 15-year high

Others on Wall Street echo the sentiment that while the broader US outlook is on solid footing, trade-related uncertainty is not exactly welcome news.

The macroeconomic outlook in the US is supported by a “still-solid consumer,” but rising trade tensions place that at risk, Deutsche Bank strategists wrote in a note to clients Monday.

“Though consumer spending has moderated, the strong labour market points to a rebound,” they added.

Now read more coverage from Markets Insider and Business Insider:

Trump is getting closer to a win on his major new trade deal with Canada and Mexico

Tesla plunges to 2.5-year low after analyst who cut his price target for the 4th time this year warns it’s facing a ‘code red situation’

JPMorgan’s quant guru breaks down the market’s ace in the hole for fighting Trump’s trade war — and explains why stocks could surge 12%

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A private-equity titan who’s doubled the money in each of his 7 funds shares the biggest investing lessons he’s gathered from 30 years of industry dominance

Visit Business Insider’s homepage for more stories.

When you spend 30 years in an industry, it’s natural to develop some reliable tricks and techniques.

And when you’ve had as much success as John Danhakl, a managing partner at the private-equity firm Leonard Green & Partners, those insights start to be worth their weight in gold.

Leonard Green, which has roughly $24 billion of assets under management, has been a beacon of strength in the private-equity space over the past three decades. The firm has launched seven funds during the period, the most recent of which raised $9.6 billion.

During the recent Milken Institute Global Conference, Danhakl told a packed room of attendees that each of Leonard Green’s seven funds had more than doubled its money invested or was on pace to do so. He estimated that the firm had generated an average gross return of about 35% during the period.

No matter how you slice it, that’s otherworldly performance. It’s also the reason Danhakl was invited to share his wisdom with a large conference audience. After all, the panel was called ” Common Sense from Uncommon Investors” — and Danhakl’s outsize returns are about as uncommon as it gets for investing.

And while the only way to truly absorb the life lessons that result from that experience is to actually do the work for decades, Danhakl was happy to share wisdom with the Milken crowd.

He provided a nine-part list of lessons he’d learned from 30 years in private equity. They are as follows, with additional commentary provided for select sections:

(1) Public markets date their investments. We marry ours.

“An example of this is, if you’d have bought Barnes & Noble after the crash, you could’ve made some money on it, for a period of time,” Danhakl said. “Had we bought Barnes & Noble after the crash, we would’ve lost everything. Our investments are made over a long period of time.”

(2) What you buy is more important than the multiple you pay.

“I’ve never seen price make a bad deal a good deal, ever,” Danhakl said. “And truthfully, I’ve never seen price make a good deal a bad deal. I’ve seen price make a good deal kind of a mediocre deal.”

He continued: “If all of the transactions we do either end up in the great-to-mediocre camp, we’re going to do just fine. That’s why we’ve done as well as we have.”

(3) There’s no such thing as a must-do deal.

“This comes back to the benefit of experience over youth and energy,” Danhakl said. “Young people want to get things done. What happens is, you’re target-focused, and a little bit more starts to be OK.”

He continued: “A lot of our younger people think ‘this is the one I have to do.’ And I just say, no, it isn’t the one. There will be other deals. The key is avoiding making mistakes. That’s kind of the point.”

(4) We earn our income from the deals that work. We learn the business from the deals that don’t.

“The rhythm of the private-equity industry is slow,” Danhakl said. “If you’ve been in the private-equity industry for five, six years, you’ve probably done two, three deals, and you don’t even know if they’ve worked.”

He continued: “The question is: How do you learn the business? At Drexel Burnham, we were closing a deal a month. We were the financing, and other folks were doing the deals. That rhythm showed us what worked and didn’t work.”

(5) A good contract doesn’t make a lousy investment successful.

(6) We all know what leverage does for an investment. Consider also what leverage does to an investment.

(7) Hope is not an investment strategy.

(8) Brilliance and toughness are respected. A sense of humor and a positive perspective are valued and appreciated.

(9) The most effective place for an iPhone is in your pocket.

This is a subscriber-only story. To read the full article, simply click here to claim your deal and get access to all exclusive Business Insider PRIME content.

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Google offers Huawei a brief reprieve by putting its Android suspension on hold

Sundar Pichai
Google CEO Sundar Pichai.

Justin Sullivan/Getty Images

Google has put on hold its suspension of Android services to Huawei.
  • It follows the US Department of Commerce’s decision to allow Huawei a 90-day license after blacklisting the company last week.
  • A Google spokesman told Business Insider that the grace period would allow Google to “provide software updates and security patches to existing models for the next 90 days.”
  • It’s good news for Huawei users who were panicked after learning of Google’s suspension, with some asking their network operators whether they could return their phones.
  • Visit Business Insider’s homepage for more stories.
  • Google has confirmed that its suspension of Android services to the Chinese tech giant Huawei is on hold.

    The move follows the US Department of Commerce’s decision to grant Huawei a license of 90 days so it could help existing customers. Last week, the department blacklisted Huawei by placing it on an entity list, forcing US companies to seek government permission before dealing with the company.

    Following the blacklisting, Google on Monday announced it had severed ties with Huawei, whose phones use Google’s Android operating system. The news panicked Huawei users, with some asking their network operators whether they could return their phones, and sent Huawei scrambling to reassure users about plans for its own operating system.

    But Google has followed the Department of Commerce in offering Huawei a reprieve until August 19. A source familiar with the matter told The Wall Street Journal that Google put the Android suspension on hold.

    Read more: Trump’s blacklist of Huawei has serious implications for Red Hat, Oracle, VMware, and other huge US software companies

    Google confirmed this in a statement to Business Insider. “Keeping phones up to date and secure is in everyone’s best interests and this temporary license allows us to continue to provide software updates and security patches to existing models for the next 90 days,” a Google spokesman said.

    Huawei declined to comment on Google’s plans.

    Secretary of Commerce Wilbur Ross said the 90-day grace period was meant to give companies time to get their houses in order before cutting them off from Huawei.

    “The Temporary General License grants operators time to make other arrangements and the Department space to determine the appropriate long term measures for Americans and foreign telecommunications providers that currently rely on Huawei equipment for critical services,” he said. “In short, this license will allow operations to continue for existing Huawei mobile phone users and rural broadband networks.”

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    Trump reignited his feud with Fox News for hosting a live event with Pete Buttigieg, prompting thousands of supporters to boo his favorite network

    At a rally in Pennsylvania Monday night, President Donald Trump made it clear that he’s still holding a grudge against Fox News for giving airtime to Democratic rival Pete Buttigieg.

    Trump continued the feud on-stage, making several jibes at his favorite news network, and prompting a chorus of boos at Fox’s expense from the large crowd.

    It followed tweets on Sunday in which Trump said Fox was “wasting airtime” by showing the Buttigieg event.

    Trump told supporters in Montoursville that “something strange” was affecting Fox. He mentioned Buttigieg in particular, whom he again compared to Mad magazine cartoon character Alfred E. Neuman:

    “Last night I watched Alfred E. Neuman. What’s going on with Fox, by the way? What’s going on there?”

    “They’re putting more Democrats on then you have Republicans. Something strange going on at Fox, folks. Something very strange!”

    Read more: Paul Rudd played an unrelatable Pete Buttigieg visiting ‘The View’ on ‘SNL’

    “Did you see this guy [Buttigieg] last night? I didn’t wanna watch but you’ve always got to watch the competition — if you call it that.”

    Donald Trump looks at supporters before boarding Air Force One after addressing a Trump 2020 re-election rally in Montoursville, Pennsylvania.
    Reuters

    “He was knocking the hell out of Fox! And Fox put him on. Somebody going to have to explain the whole Fox deal to me,” Trump told the Montoursville crowd.

    Fox also broadcast the Trump rally, including his criticism of the network. When Trump attacked Fox, boos erupted from the crowd.

    Pete Buttigieg speaking at the town hall in Claremont, NH, on Sunday.
    Fox News

    Buttigieg had used part of his town hall in Claremont to call out Fox hosts Tucker Carlson and Laura Ingraham for their coverage of the Mexico border migrant crisis. (Neither were at the event.)

    He chastised Carlson for “saying immigrants make America dirty” and Ingraham for “comparing detention centers with children in cages to summer camps.”

    Read more: ‘Boot-EDGE-EDGE’: Trump tries to pronounce 2020 Democratic candidate Pete Buttigieg’s name at Florida rally

    During the broadcast Wallace asked Buttigieg about Trump’s Twitter outburst.

    Pete Buttigieg speaking to Chris Wallace on Fox News on Sunday.
    Fox News

    “The tweets are — I don’t care,” Buttigieg replied.

    Buttigieg conceded it’s “hard for any one to look away,” when Trump starts tweeting, adding “it is the nature of grotesque things that you can’t look away.”

    When he finished, Buttigieg got a standing ovation from the New Hampshire crowd.

    Read The Complete #NewsArticle Here at the Original Publishers Website

    5 Reasons Game Of Thrones Finale was the Worst Letdown In TV History

    Francois Aure

    CCN: Game Of Thrones is over. There’s a high likelihood that the emotions you are feeling include frustration and betrayal. Here are the five moments that made the Game of Thrones’ finale the worst disappointment in TV history.

    1. Drogon Should Have Killed Jon Snow

    In Jon’s final moments with Dani, the elephant in the room was a dragon. Why would the extremely emotional fire-breather take out his rage on the castle wall and an inanimate iron throne after sniffing the dagger and realizing its owner was Snow? Yes, he can’t burn him, but he has 100 different ways to squash or slice him. Plus, are we supposed to believe the inference that he blamed the throne for her demise? Umm, Dani technically didn’t kill anyone bro, it was you. The Lord of Light kept everyone alive for a reason. It turns out Jon was supposed to kill Ms. Targaryen, but then unlike every other divinely-powered character, he did not get the quick death post realizing his destiny.

    Here it is. The best meme to ever come out of game of thrones. pic.twitter.com/XeMc5622Kq

    — Britney Gil (@_britneygil) May 20, 2019

    Presumably, Kit Harrington’s potential spinoff is worth more than the show’s integrity, which brings us to number 2…

    Jon Snow looks how I feel… pic.twitter.com/8Rxkz7sJAz

    — Stephen Oyoung (@MrStephenOyoung) May 20, 2019

    2. Arya Plugs A Spinoff

    To be clear, the most obvious thing about Game of Thrones finale was not the amount of weight that Kit Harrington put on, it was Arya’s advert for a probable GoT spinoff. A journey west? Full of mystery and wonder where the streets have no name? It is no secret that the Stark assassin has captured the hearts of many and it was cringeworthy to see her take off on an open-ended voyage. What about Gendry Baratheon? Clearly, their love scene was as meaningless and two dimensional as it appeared.

    3. Bronn Gets High Garden; He’s Still Grinding A Day Job

    Bronn, Lord of High Garden. Once a hustler always a hustler. The now gloriously wealthy former bodyguard is still going to work a day job as Master of the Coin. The old ruling family of High Garden religiously married into the most celebrated families in Westeros. Sadly, GoT’s writers must have decided it was too much screen time for Jerome Flynn, as he didn’t make the cut for the coronation. Fret not, two lowly knights (Sir Davos and Sir Brienne) did. Can you see Olenna Tyrell accepting this snub?

    Source: Giphy

    4. So many Unsullied, So Many Dothraki

    “The end of the Dothraki essentially”

    Like this was said two episodes ago pic.twitter.com/UEtTLsrjqh

    — Ramon (@MrMcCheeziez) May 13, 2019

    Ahh, the battle of Winterfell. The bodies were piled high as the Dothraki surge extinguished and a wall of dead plowed through thinning lines of The Unsullied. As the Queen addressed her large group of forces, it was almost incredulous how many lines of soldiers stood in front of her. Why compound a gaping plot hole?

    game of thrones finale

    Unlimited re-spawn for Dani’s troops | Source: HBO

    5. Everyone Listens To Greyworm & Sam the Silent

    Remember the lead soldier who led the mass slaughter of innocents in King’s Landing? While Dani deserved to die, apparently, Grey Worm didn’t. In fact, they still let him call the shots. As the only name character in Westeros who wasn’t relieved that the mad Queen was dead, he seemed to have a lot of negotiating power to send Jon to the wall. Sansa Stark made practically no effort to argue for her brother and popped back to Winterfell to crown herself. Worst of all, John’s best friend Sam Tarly had nothing to say whatsoever.

    Game Of Thrones Re-Watch Probability? 0%

    Thus ends HBO’s chances of reaping millions in “The Office” style binging. With no satisfying conclusion and forgotten foreshadowing, what’s the point? Another run through is as pointless as a Night’s Watch when there are no White Walkers, a gaping hole in the wall and you’re best friends with the Wildlings.

    Tormund is out here FLOURISHING without brienne. He left her raven on read. pic.twitter.com/kolDYkZEqT

    — Game of Thrones Memes (@Thrones_Memes) May 17, 2019

    About The Author

    Francois Aure

    Financial speculator living in the hills in Los Angeles. J.D. but very much not a lawyer. Favorite trading books are anything written by Jack Schwager.

    This article was edited by Samburaj Das.

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    Bitcoin Price Blitzed $20,000, 13 Days After it Last Closed at $8,300; Déjà Vu?

    Joseph Young

    CCN: Year-to-date, the bitcoin price has surged by 113 percent in a stunning recovery, achieving $8,000 in merely six months after plunging to $3,150 in December 2018.

    bitcoin experienced extreme volatility in recent days

    Although bitcoin experienced extreme volatility in recent days, it’s up significantly in 1 month (source: coinmarketcap.com)

    As said by Thomas Lee, a co-founder at Fundstrat Global, bitcoin has historically tended to record most of its gains in a short time frame, typically in a 10-day window, unlike traditional assets and asset classes.

    2/ Reminder that BTC generally generates all of its performance within 10D of any year.

    –ex the top 10 days, BTC is down 25% annually since 2013 pic.twitter.com/zoEocEEZvu

    — Thomas Lee (@fundstrat) April 2, 2019

    According to cryptocurrency researcher Alex Saunders, the last time the bitcoin price closed above $8,300, it took 13 days to achieve a new all-time high at $20,000.

    Whilst it remains unclear whether a similar short-term performance would be demonstrated by bitcoin this time around due to the noticeable difference in catalysts that are triggering the upside movement of the asset, it is worth considering the trend shown by the asset in the previous bull market.

    Will bitcoin experience a similar bull run as 2017?

    It is highly unlikely for bitcoin to initiate a sudden recovery to $20,000 in the near-term as it approaches $8,300. In 2017, the $8,300 mark represented a level which was secured following an impressive $7,000 gain in 12 months.

    The fourth quarter of 2017 ended with a 219 percent because of the rally of bitcoin from $8,000 to $20,000, but in previous quarters, the dominant cryptocurrency consistently recorded large gains against the U.S. dollar.

    $BTC

    current quarter ranks as the 2nd highest quarterly gain since 2014 and the 7th highest quarterly gain all-time pic.twitter.com/bNTohKJREw

    — Josh Olszewicz (@CarpeNoctom) May 19, 2019

    Hence, although it is not reasonable to expect bitcoin to suddenly run up from $8,000 to $20,000 in a short time frame in the near-term, it is possible for the asset to experience an abrupt run up by the year’s end if it consistently performs strongly throughout the year.

    “The last time bitcoin had a daily close above $8300 whilst in a uptrend was Nov 25 2017. It then took 13 days (11 up. 2 sideways. 0 down.) to reach $20k,” said Saunders.

    Previously, speaking to CNBC, former Coinbase CTO Balaji Srinivasan stated that the bitcoin market tends to move by cycles. Bitcoin tends to go through a pattern of bubble-burst-build-rally, and in the past 10 years, the pattern has occurred four times.

    He said:

    Yeah, it’s the Carlota Perez/Gartner Hype Cycle thing all over again. Virtually every major technology has an initial spike of interest, then a dip, and then a long-term rise to success. The dot-com bubble is the canonical example, but there are many more. Bitcoin alone has gone through at least four of these cycles.

    The pattern materializes because following every bear market, companies, developers, and market participants work to strengthen the infrastructure supporting the asset class.

    In 2019, infrastructure development has been targeted at institutions with the involvement of major financial institutions such as Fidelity and TD Ameritrade.

    So far into the year, institutional investors have responded positively to the significant progress made by companies in improving the quality of custodial services and regulated investment vehicles that accredited investors can use to commit to the market.

    Bitcoin has already recorded its second-best quarter since 2014 and is closely resembling the trend seen in 2017.

    If the 2017 bull run was primarily triggered by retail investors, industry executives expect the 2019 rally to be triggered by institutional investors.

    Should investors be concerned about volatility?

    In the past several days, the bitcoin price has wildly moved between $7,500 to $8,000, demonstrating extreme volatility in short time frames.

    A cryptocurrency trader suggested that the volatility of bitcoin could be beneficial for altcoins and tokens with small market capitalizations, leading the rest of the cryptocurrency market to engage in a strong bull run.

    “Everything going as planned. Altcoins starting to run – IEO’s pumping away, LINK + a few others just getting started. More altcoins will start to run as we scale in. June they will fly. You will see that bull market pumps are quite different than bear market pumps,” the trader said.

    About The Author

    Joseph Young

    Hong Kong-Based Finance and Cryptocurrency Analyst. Contributing regularly to CCN and Hacked. Providing unique insights into the crypto and fintech space since 2012.

    This article was edited by Samburaj Das.

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    Huawei developed a ‘plan B’ operating system for smartphones in case it was banned by the US government from using Google products. Here’s what we know about it so far.

    Huawei Mate 20 Pro 4
    Huawei is said to be developing its own mobile operating system to run on its smartphones.

    Antonio Villas-Boas/Business Insider

    • Huawei is said to be developing its own mobile operating system, which the company said is a “plan B” if relations with Google were ever to sour.
    • Now that Huawei has been banned from accessing parts of Google’s Android mobile operating system after the US government placed the company on a trade blacklist, it’s as good a time as any for Huawei to speed up development towards its own mobile operating system.
    • Little is known about Huawei’s home-grown OS, but it’s been reported that it’s called “HongMeng OS.”
    • Even if Huawei can develop an amazing mobile operating system of its own, it would still need to convince app developers to bring popular apps to Huawei’s own mobile app store.
    • Visit Business Insider’s homepage for more stories.

    The Chinese telecoms company Huawei has been banned from accessing parts of Google’s Android mobile operating system after the US government placed the company on a trade blacklist.

    While it’s not an all-out ban of Huawei devices, the blacklisting would affect future Huawei devices, and could mean that current Huawei phones will stop getting Android updates.

    Without Android, Huawei phones could be nothing more than doorstop made of glass and silicon chips. Not only is the Android operating system the functional foundation of all Android smartphones, but it also brings Google’s Play Store, which contains all of Google’s popular apps, like Gmail, YouTube, and Google Maps, as well as the ever-growing list of popular third-party apps.

    In order to prepare for a potentially Android-less future, Huawei is said to be developing its own mobile operating system to run on its smartphones.

    Check out everything we know so far:





    1/

    Huawei’s own home-grown mobile operating system is reportedly called “HongMeng OS.”


    Eric Gaillard/File Photo via Reuters

    Huawei’s homegrown mobile operating system is called “HongMeng OS,” according to a tweet from the Global Times, a Chinese national English-language news outlet, citing Chinese media reports.





    2/

    HongMeng OS is likely the “plan B” operating system Huawei mentioned previously.


    Antonio Villas-Boas/Business Insider





    3/

    Huawei has reportedly been developing HongMeng OS since 2012.


    Sean Gallup/Getty Images





    4/

    Whether Huawei is building its own operating system or not, the company has a huge roadblock to deal with.


    Antonio Villas-Boas/Business Insider

    Dr. Wang Chenglu, president of Huawei’s Consumer Business Software Engineering, told Chinese media in September 2018 that while developing an operating system itself wasn’t difficult, it’s the ecosystem and app support that would be the biggest roadblock for a Huawei-made mobile operating system.

    Mobile platforms absolutely need a healthy ecosystem, especially when it comes to apps. Lack of app support will almost certainly foretell the death of any newcomer to mobile platforms. It was always the biggest problem with Microsoft’s Windows mobile platform.

    For Microsoft, it was an ever-ending cycle of doom: Windows phones had the lowest market share, so app developers didn’t want to spend the time and money to develop apps for Windows phones. And since popular apps were slow to become available on the Windows mobile platform — if at all — Windows Phone had significant issues gaining any market share.

    Samsung also tried its hand in 2015 at offering phones that ran on the company’s own homegrown operating system, called Tizen. Needless to say, Samsung Tizen phones aren’t exactly popular. In a Samsung Tizen phone review, Ars Technica wrote “We weren’t impressed. It felt like a hollow copy of Android without any apps.” And that’s exactly what a Huawei operating system will likely feel like, too.





    5/

    Huawei’s operating system might actually be fine in China, but Google’s Android ban will make Huawei phones less appealing elsewhere.


    Reuters/Edgar Su

    Chinese smartphone users are already used to handling Android phones that don’t come with Google’s Play Store, including Google’s own apps and all the popular third-party apps available from the Play Store — the Google Play Store and Google’s apps are banned in China.

    Elsewhere, however, where access to Google’s Play Store, Google apps, and popular third-party apps are plentiful, consumers aren’t very likely at all to adopt Huawei smartphones that don’t have access to the apps they want.

    Google’s lack of support could have massive implications for Huawei’s global smartphone business, and its current standing as the second- or third-biggest smartphone maker in the world is in jeopardy.





    6/

    Reports suggest Huawei phones could still run on a basic version of Android with Huawei’s own EMUI interface running on top, but that wouldn’t change much for Huawei.


    Shona Ghosh/Business Insider

    It’s possible that Huawei could adopt the open-source and bare-bones version of Android. Huawei’s own interface that runs on top of Android on its smartphones, called EMUI, could potentially make Google’s ban unnoticeable to the typical smartphone user. Huawei could resume as normal, at least for the consumer in China.

    Still, without active support from Google for new features, future updates, and future versions of Android, Huawei would be under more strain to bring high-end features to its future smartphones.





    7/

    And it’s still unclear how recent developments with Google and Android will affect Huawei’s highly anticipated foldable Mate X smartphone.


    Reuters

    Google’s support would have been important for Huawei to develop a version of Android that runs on Huawei’s highly anticipated foldable Mate X smartphone.

    Now, Huawei is on its own. We’ll have to wait and see how it all plays out, not just for Huawei’s regular smartphones, but also its foldable smartphones.

    Get the latest Google stock price here.

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    There’s a huge loophole in a new DOJ filing that Trump cited to block Don McGahn from testifying before Congress

    • The White House announced Monday that President Donald Trump has instructed former White House counsel Don McGahn to ignore a congressional subpoena for testimony.
    • To justify the move, the White House pointed to a new Justice Department memo that says Congress cannot force a presidential adviser to testify.
    • But legal experts were quick to point out that the memo didn’t account for one key possibility: McGahn choosing himself to testify.
    • “There’s nothing in [the memo] that remotely supports the idea that McGahn can somehow be ‘blocked from testifying,” said one law professor.
    • Visit BusinessInsider.com for more stories.

    The White House announced Monday that President Donald Trump instructed the former White House counsel, Don McGahn, not to comply with a congressional subpoena for testimony related to the Russia investigation.

    In a statement, White House press secretary Sarah Sanders pointed to a new memo from the Justice Department’s Office of Legal Counsel “stating that, based on long-standing, bipartisan, and Constitutional precedent, the former Counsel to the President cannot be forced to give such testimony, and Mr. McGahn has been directed to act accordingly.”

    Indeed, the memo said, “Congress may not constitutionally compel the President’s senior advisers to testify about their official duties.”

    But as legal experts were quick to point out, the opinion doesn’t account for one important possibility: McGahn choosing to testify before lawmakers.

    Read more: White House officials asked Don McGahn to publicly say Trump didn’t obstruct justice after they saw Mueller’s report

    ‘McGahn does NOT have to comply with Trump’s instruction’

    “The key here is what the OLC opinion does not say — that McGahn can be barred from voluntarily testifying before Congress,” Steve Vladeck, a professor at the University of Texas School of Law, wrote on Twitter. “All it says on that front is that he can’t be punished for refusing to testify (Part IV), not that the President has any means of stopping him from doing so.”

    “Whether or not the OLC opinion is correct that McGahn can’t be punished for refusing to testify (which is the weakest part of the analysis, in my view), there’s nothing in these 15 pages that remotely supports the idea that McGahn can somehow be ‘blocked from testifying,'” Vladeck continued.

    Eric Columbus, who served as senior counsel to the deputy attorney general under former President Barack Obama, echoed that view, tweeting, “McGahn does NOT have to comply with Trump’s instruction.”

    The OLC memo said, “Coercing senior presidential advisers into situations where they must repeatedly decline to provide answers, citing executive privilege, would be inefficient and contrary to good-faith governance.”

    But “executive privilege has no force against a former employee who wants to testify,” Columbus tweeted.

    Read more:The FBI’s former top lawyer said Mueller’s obstruction findings are ‘alarming’ and show a ‘pattern of corruption’

    He also said McGahn cannot assert attorney-client privilege in refusing to testify, because the DC Circuit Court of Appeals has ruled that there is no attorney-client privilege between the White House counsel and the president.

    But McGahn does have an incentive to comply with Trump’s order

    But several observers noted that McGahn has incentive to comply with Trump’s order, even if he isn’t legally required to. McGahn is a prominent player in Republican political circles, and defying the White House could not only put his own career at risk, it could also prompt the president and his allies to urge others to boycott McGahn’s law firm, Jones Day.

    Indeed, McGahn has walked a tightrope since the special counsel Robert Mueller’s final report in the Russia investigation was released. Though prosecutors did not make a decision on whether Trump was guilty of obstruction of justice, the document laid out an extensive roadmap of evidence against the president, much of which came from McGahn when he testified for over 30 hours to Mueller’s office.

    Trump and his lawyers promptly attacked McGahn’s credibility and accused him of falsifying his testimony. Though McGahn’s lawyer said in a statement that what his client told Mueller was true — and backed up by corroborating evidence — he emphasized that “Don, nonetheless, appreciates that the President gave him the opportunity to serve as White House Counsel, and assist him with his signature accomplishments.”

    Renato Mariotti, a former federal prosecutor in Chicago, highlighted how McGahn is likely to comply with Trump’s order.

    The probable solution, he added, is that “Democrats will have to hold him in contempt and then go to court to compel his testimony.”

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    VCs are just starting to invest in companies that move medical care into homes and out of hospitals. We talked to 3 top investors about what’s holding them back.

    Visit Business Insider’s homepage for more stories.

    When it comes to getting medical care, more and more can be done outside the four walls of the hospital.

    Chronic conditions can increasingly be managed at home, with the help of visits from medical professionals or occasional checkups in a doctor’s office. Getting care without much travel is particularly beneficial for the sick and elderly, who may have more difficulty traveling.

    It’s a big market for venture investors to explore, especially as Americans age. As a whole, the elder-care market is worth an estimated $350 billion according to one VC, and home health, hospice and personal care are all multibillion-dollar businesses. The field is pretty fragmented: There are an estimated 2.5 million home-care workers out there, and about 12,400 home-health agencies managing them all.

    Investing in senior care as a VC is easier said than done. Caring for elderly and chronically sick patients at home can be labor intensive, and already venture-backed companies looking to care for patients outside the hospital have run into roadblocks.

    Read more: A VC spoke to 30 founders and investors about the $350 billion elder-care market and found 3 reasons why starting a company in the market is a challenge

    Moving care from the hospital to the home

    GV general partner Krishna Yeshwant has been looking at companies attempting to move more of the medical care traditionally done within a hospital into the home. So far, GV, which is the venture arm of Google parent company Alphabet, hasn’t made any investments in the space. GV manages more than $4.5 billion.

    “We’ve come away pretty convinced that it’s possible to do this,” Yeshwant said.

    There’s a big caveat, though: He hasn’t determined whether it’s something hospitals will independently have to build themselves, rather than having a venture-backed startup come in and build out nationally.

    “It may make the most sense for a hospital to just do it themselves,” he said.

    Should hospitals and health systems not build up businesses that let them take care of sicker and elderly patients at home, they could lose out on those patients to competitors.

    Health systems, for their part, are thinking about the transition.

    “The future is the home, and the home of the future is going to be not just a place called a home. It’s also going to be a medical site,” Kaiser Permanente CEO Bernard Tyson told Business Insider in 2018. For instance, Kaiser sends patients who have gotten hip replacements home with care from nurses and physical therapists after a short hospital stay.

    Read more: The CEO of a company often called the future of healthcare reveals why medical care is moving into homes and out of hospitals

    Holding off on early investments

    Addie Lerner, a principal at General Catalyst, has been looking into the elder care market for about a year, with an interest in finding companies that are coming up with creative ways to reach elderly Americans.

    Lerner’s found that the entrepreneurs she’s meeting with and companies she’s hearing about are still too early for her to make investments.

    “This industry is still so early and nascent,” Lerner said.

    For now, she’d rather wait until companies have hit a series A or beyond stage of fundraising and have more clearly proven out a business model. Even so, she said she’s encouraged by the number of companies flooding into the area.

    A labor-intensive home care model

    It can be particularly difficult for tech-focused investors to fund home-care companies, because the businesses rely on the labor of lots of individuals.

    “It’s a bit of a challenging use case for private tech companies just because of how service intensive home care is,” Lerner said. “That’s why I think we’ve seen so many home care agencies struggle or change course.”

    For instance, in February 2017 Homehero, a startup with $20 million in funding, shut down its home care business and pivoted to a healthcare venture. Honor, which has raised $115 million, started by competing with established senior-care agencies. But in 2017, Honor started working with the agencies instead.

    When it comes to new companies taking care of patients outside the home, Andreessen Horowitz general partner Jorge Conde, whose firm invested in Honor, said he’s spent time focusing on companies that are using technology to make connections within the fractured home care and home health business, and also helping connect those companies and workers back into the broader healthcare system.

    “Technologies and companies are looking to be the connective tissue to allow the systems to better integrate home health for the care paradigm,” Conde told Business Insider.

    Still, Conde he’s seeing a lot of companies tackling bits and piece of the home health and home care market, and it’s hard to tell which ones will catch on.

    Lerner said that for a new entrant to be successful in the home-care market, it’ll have to bring a new technology or service that isn’t currently offered. That could be something like educational services or companionship, she said.

    “Perhaps that specialization can change the cost structure a bit and mean that you’re providing really good medical care from your home aid, while you’re supplementing content and companionship through other services.”

    For now, Lerner said, her hope is that smaller companies become really good at one specialty, like content. Then, maybe later, all of those services could become one company offering packages of different services that makes it stand out from today’s home care competitors.

    • Read more:
    • A startup that’s raised $115 million once wanted to disrupt the multi-billion home care industry — now it’s working with it
    • The CEO of a $3.7 billion senior-care company went to a country facing a ‘demographic time bomb,’ and what he saw could be a lesson for the US
    • Digital health startups worth $7.6 billion are set to IPO, breaking a 3-year drought. Here’s what 5 top VCs are keeping an eye on.
    • The CEO of a company often called the future of healthcare reveals why medical care is moving into homes and out of hospitals

    This is a subscriber-only story. To read the full article, simply click here to claim your deal and get access to all exclusive Business Insider PRIME content.

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    I pay $550 a year for my AmEx Platinum, and my favorite perk makes the high fee worth it

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    Platinum Card® from American Express charges a $550 annual fee, but comes with a laundry list of valuable benefits.
  • Lounge access may be one of the most valuable, since the AmEx Platinum gives cardholders access to three lounge networks: Priority Pass, Delta SkyClub, and American Express Centurion.
  • While the Centurion lounges are the nicest, they’re the least common. Priority Pass lounges seem to be everywhere, though, and Delta lounges can come in handy.
  • The Platinum Card from American Express is one of my favorite credit cards, even with its $550 annual fee. With an annual fee that high, though, the benefits better be worth it.

    In my opinion, they are, and that’s why I keep this card around.

    The No. 1 reason why I love my Platinum Card is the number of lounges I can get into. The AmEx Platinum participates in three different lounge programs: Priority Pass, Delta SkyClub, and American Express Centurion.

    By far, the AmEx Centurion lounges are the nicest, but they’re located in the least number of airports. Within the US, you can find a Centurion Lounge at Dallas-Fort Worth (DFW), Houston (IAH), Las Vegas (LAS), Miami (MIA), New York La Guardia (LGA), Philadelphia (PHL), San Francisco (SFO), and Seattle-Tacoma (SEA).

    New lounges are in the pipeline as well. The next Centurion Lounge in the US will be at my home airport, Denver (DEN)! There are also eight Centurion Lounge locations at international airports. You can bring up to two guests with you to the Centurion Lounge with your AmEx Platinum card.

    Even though Priority Pass lounges aren’t as nice as Centurion, I use them the most. That’s because there are over 1,200 lounges worldwide that participate in the Priority Pass program. It’s pretty unusual for me to be at an airport that doesn’t have a Priority Pass lounge I can access.

    Priority Pass has also been expanding its program to have member restaurants. If you visit a Priority Pass restaurant, you’ll get a food and beverage credit (usually $28 per person) and can just order off the menu! You can bring up to two free guests with your Priority Pass membership.

    I don’t live in a Delta hub and I don’t fly Delta that often, but it’s nice to have additional lounge access for the rare occasion it comes in handy for me. In order to access the Delta SkyClub with your Platinum Card, you must be flying on Delta or a SkyTeam partner (like Air France or AeroMexico) that day and you can’t bring in any guests. For those two reasons, I find it to be the least useful of the three lounge access programs, but still nice to have.

    Between the Priority Pass, Delta SkyClub, and American Express Centurion memberships, my AmEx Platinum can get me into a lounge in almost any airport I visit.

    Learn more about the AmEx Platinum from our partner The Points Guy »

    Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

    Business Insider may receive a commission from The Points Guy Affiliate Network, but our reporting and recommendations are always independent and objective.

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