The daily business briefing: August 10, 2018

Harold Maass
The Tesla sign in Brooklyn
Drew Angerer/Getty Images
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Turkish lira dives, stoking fears of contagion

The Turkish lira plunged by as much as 12 percent against the U.S. dollar on Friday, dragged down by Turkey's deepening rift with the U.S. and the perceived lack of action by its leaders to address the country's economic troubles. It was the worst day since the country's 2001 economic crisis for the Turkish currency, which is down more than 35 percent this year. The lira's dive raised fears of wider fallout, weighing on global stocks and sending investors seeking U.S. government bonds, the yen, and other safe assets. The MSCI All-Country World index, which tracks shares in 47 countries, was down by 0.6 percent, and U.S. stock futures pointed to a weak open on Wall Street. Futures for the Dow Jones Industrial Average and the S&P 500 fell by 0.4 percent, and those for the Nasdaq-100 dropped by 0.5 percent. [Reuters, MarketWatch]


Tesla shares drop, losing gains fueled by Musk tweet

Tesla shares dropped by 4.8 percent on Thursday, giving back the gains from a rally sparked two days earlier when CEO Elon Musk announced that he was considering taking the electric-car maker private. The stock fell to $352.45, far below the $420 mark at which Musk said shareholders would be bought out, as investors questioned whether Musk could pull it off. Musk sent the stock soaring 11 percent higher on Tuesday after claiming he had "funding secured" at a price that would value the company at $82 billion. Since then, he has not provided any evidence he had it lined up. People with knowledge of 15 financial institutions and technology firms said they knew of no financing lined up to execute Musk's proposal. Tesla's board is seeking more information on Musk's plan. [Bloomberg, Reuters]


Moscow threatens retaliation against U.S. sanctions

Russian Prime Minister Dmitry Medvedev warned on Friday that Moscow would retaliate against new U.S. sanctions with its own economic and political actions. Medvedev called the U.S. move to punish Russia over a nerve agent attack against a former spy and his daughter in England a red line. The Kremlin denies involvement in the case. The U.S. sanctions announced this week include the presumed denial of export licenses for Russia to purchase items with national security implications. Congress is considering proposals targeting Russia's state-controlled banks, and freezing their operations in dollars. The moves could deal a heavy blow to the Russian economy, and the announcement the sanctions were coming already has sent the Russian ruble diving to a two-year low point. [The Associated Press]


Appeals court orders Trump administration to halt sale of dangerous pesticide

The 9th U.S. Circuit Court of Appeals in San Francisco ruled Thursday that the Trump administration endangered public health by keeping the widely used pesticide chlorpyrifos on the market despite extensive scientific evidence that exposure can harm babies' brains. The court ordered the Environmental Protection Agency to halt the sale of chlorpyrifos, which is used to spray citrus fruit, apples, and other crops, within 60 days. The split court said then-EPA chief Scott Pruitt, a Republican forced to resign this summer over ethics scandals, violated federal law by ignoring warnings by agency scientists that the pesticide was harmful. Judge Jed Rakoff wrote in his opinion that "there was no justification" for allowing chlorpyrifos given the indications "that its residue on food causes neurodevelopmental damage to children." [The Associated Press]


Trump administration proposes cutting ObamaCare effort to improve Medicare

The Trump administration announced Thursday that it planned to significantly cut back Accountable Care Organizations, an innovation in the Affordable Care Act intended to improve Medicare and slow its spending. Health-care researchers have praised the plan's potential to boost quality and efficiency in the federal insurance system for older Americans, although government data have not shown the desired savings. ACOs include teams of doctors, hospitals, or other providers charged with overseeing health care for groups of patients. The program incentivizes the teams to lower the cost of care, offering bonuses if they don't go over a spending threshold. More than 80 percent of 561 participating teams, involving 300,000 clinicians and 10 million patients, have opted for the bonuses, and federal health officials say the program has stuck Medicare with extra costs. [The Washington Post]