Thrown under the bus

MARKETS

• Economy: If you see any economists going a little over the top on St. Patty’s Day, it’s because manufacturing output declined for the second straight month in February. A slowdown could be here.
• U.S. markets...didn’t seem to care. The S&P had its best weekly gain since November.

AUTO

Volkswagen Puts the Sue in SUV

The SEC has filed civil claims against both Volkswagen and its former CEO, Martin Winterkorn, for defrauding U.S. investors in the company’s Greek tragedy-level diesel emissions scandal.
The scandal elevator pitch

It broke in September 2015, when VW got caught deploying high-tech software to cheat on U.S. emissions tests and allow its cars to pump out up to 40x what was allowed. The scheme started with 482,000 cars...but ballooned to 11 million worldwide within days.

Last year, a federal grand jury indicted Winterkorn and a few other VW employees on criminal fraud charges, alleging Winterkorn knew of the diesel scheme in 2014, one year before it was disclosed.

Back to today

The SEC’s latest claim? Winterkorn knew about the fraud even earlier than first thought—perhaps as early as 2007.

• The suit could open the door for new fines against Volkswagen in the U.S. (The carmaker has already forked over more than $25 billion in fines, penalties, and settlement compensation.)
• Plus, it might give the thousands of investors suing the company for damages in Germany even more ammo for their cases.

VW called the SEC’s complaint “legally and factually flawed” and vowed to fight the charges “vigorously.” It’s argued before that the diesel scheme was the brainchild of low-level engineers, not c-suite bigwigs like Winterkorn.

At VW, you never need to look too far for a bus to throw people under.

But it’s important to always look on the bright side of your diesel emissions scandal.

• Sure, it cost VW more than $30 billion in total...but it’s also given the company “an invaluable kick in the pants,” as the WSJ puts it.

Volkswagen has worked hard to put the fiasco behind it and rebuild its reputation. The carmaker’s Taylor Swift-ing has helped its stock outperform most peers since the scandal came to light. And VW vowed to boost its electric vehicle production by 50% over the next decade.

SOCIAL MEDIA

New Zealand Shooter Leveraged Social Media in Attack

At least 49 people were killed and dozens more injured in a mass shooting at two mosques in Christchurch, New Zealand, Friday.

And social media companies appear to have played a role. A gunman (identified only as a man in his late 20s) broadcast his attack live on Facebook (-2.46%) after publishing a white supremacist manifesto online.

What happened: The manifesto was posted on Twitter and 8chan minutes before the shooter opened fire. The post on 8chan (which is known for hosting alt-right messaging boards) linked to what appears to be the gunman’s Facebook account.

• Facebook quickly shut down the account associated with the livestream, but the 17-minute video showing what appeared to be the shooting still got widespread play online—on platforms including Instagram, Reddit, and YouTube.
• “We’re also removing any praise or support for the crime and the shooter or shooters as soon as we’re aware,” FB said.

Zoom out: The NYT called the Facebook livestream of the shooting “a grim milestone in the evolution of terrorism,” which raises the question of how, exactly, Big Tech can block the extremism that's flourished on its platforms.

CLIMATE

Is It Playing Hooky If You’re Protesting Climate Change?

Students in at least 112 countries skipped school Friday to demand more urgent action on climate change.

• Rather than trig functions, it was “Hey hey, ho ho, climate change has got to go!”
• And who needs Chaucer when you’ve got rhymes like “Stop denying, the Earth is dying”?

The backdrop: Oil execs spent the last five days meeting at the CERAWeek by IHS Markit conference. The atmosphere? Companies are aware of changing public (and investor) attitudes toward fossil fuels, but they still want to control the conversation.

• “We need to drive this as an industry, to be part of the solution and not be dragged into a low-carbon future,” the CEO of Norway’s Equinor told the WSJ.

Eni, an Italian energy giant, is driving...something. It pledged yesterday to eliminate greenhouse gas emissions from its oil and gas exploration and production operations by 2030. And it’ll do that in part by planting giant forests across multiple African countries to remove CO2 from the atmosphere.

How giant? The forest will be 4x the size of Wales, per the FT.

Sorry if that doesn't really help.

MARKETS

The Witching Hour Is Nigh

Cool it—Hocus Pocus season is still months away. We’re talking about a quadruple witching. Which would be like if the Sanderson Sisters added a fourth sibling who’s a Wall St. trader.

What is a quadruple witching? It’s the trading bonanza that takes place each quarter when contracts for stock index futures, stock index options, individual stock futures, and individual stock options all expire. On the same day.

When did it happen? Yesterday, which was also the day dozens of S&P indexes rebalanced their holdings—meaning ETFs needed to complete about $100 billion in combined buying and selling to reconfigure their portfolios. It’s one of the busiest trading days of the year, according to the WSJ.

What does it mean? The annual March quadruple witching has a “bullish bias,” second only to December’s showdown if history is to be believed, per Stock Trader’s Almanac editor Jeff Hirsch. Since 1983, the market has been up 24 times during the week when quadruple witching occurred in Q1 (and down 12).

TECH

So That's What a Click Farm Looks Like

WHAT ELSE IS BREWING

• A jury found that Apple (+1.30%) violated three Qualcomm (+2.17%) patents and owes the chipmaker $31 million. This is just one battle in a global legal war between the two companies.
• Ford (+0.24%) will slash 5,000 jobs in Germany and others in the U.K. to cut costs at its European operations.
• NFL players were awarded $1.7 billion in new contracts through the first day of free agency.
• Investigators at the scene of the fatal Ethiopian Airlines crash have found new evidence that may link it to a previous crash of the Boeing 737 Max 8 model, per the NYT.

BREAKROOM

Saturday Headlines
Let’s take a break from some homo sapiens news to dive into the always fascinating animal kingdom. Can you guess the headline we made up? (The other three actually happened this week.)

• "Squirrels are damaging some maple syrup operations"
• "Goat thefts plague California agricultural region"
• "Chickens 'teamed up to kill fox' at Brittany farming school"
• "Aurora Cannabis partners with cricket flour producer for a line of CBD cricket potato chips"

Breakroom Answers