Good morning. Tesla sprang a last-minute all-hands on employees last night. Typically, Tesla hosts all-hands during regular work hours — this one didn’t kick off until 9:58 p.m. ET.
Musk spoke about the vandalism and protests at Tesla showrooms, told investors to “hang on” to their stock, and shared his plan for a “legion” of Optimus robots. Read the five biggest takeaways here.
In today’s big story, investors are already bracing for one of the worst-case scenarios for the US economy.
What’s on deck
Markets: Trump and the Fed are pointing fingers.
Tech: “Severance” is a hit. Apple TV+? Not so much.
Business: Trump’s turning the screws on big law firms over DEI — but he’s skipping one GOP favorite.
But first, fears of stagflation are gaining traction.
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The big story
The dreaded S-word
iStock; Rebecca Zisser/BI
Forget a recession. Wall Street is getting wary about something worse.
The specter of stagflation sends a chill running down any investor’s spine. Stagflation involves a toxic mix of below-trend growth and persistently high inflation. It effectively ties the hands of the Federal Reserve, preventing policymakers from lowering borrowing costs to stimulate growth.
It may not be here yet, but investors are already bracing for it.
As US stocks slipped into a 10% correction last week, investors dumped shares at a record clip. Key among their worries were fears of stagflation, BI’s Jennifer Sor writes.
These fears were brought into sharper focus after the Fed’s latest policy meeting on Wednesday, when the central bank lifted its inflation forecast and lowered its growth forecast for 2025.
Even before the Fed meeting, stagflation chatter was growing on Wall Street.
A common cause of uncertainty among top economists has been US President Donald Trump’s trade war. Since the election, analysts have argued that the cost of Trump’s protectionist trade policy would ultimately be borne by the consumer.
For David Kelly, the global strategy chief at J.P. Morgan Asset Management, Trump’s retaliatory tariffs are a significant factor driving stagflation concerns.
“They’re actually sort of the magic stagflation elixir,” Kelly said. “There are very few things that will actually give you a stagflationary impulse, which both slows growth and increases inflation.”
3 things in markets
Getty Images; Chelsea Jia Feng/BI
1. Nvidia shares hit a “death cross.” The dreaded technical signal occurred because Nvidia’s 50-day moving average hit $127.39, dipping below its 200-day moving average of $127.73. But one analyst told BI it’s not a foolproof signal for a future decline.
2. President Trump’s beef with the Fed. Trump wasn’t happy about the Fed’s decision to hold interest rates this week, but the central bank is supposed to be politically independent and thinks the president’s tariff plan is stoking inflation. Here are five things to know about their rocky relationship.
3. One group of buyers could lift Tesla out of the red. Tesla’s stock sell-off has been partly blamed on CEO Elon Musk’s divisive politics. One analyst at TD Cowen thinks it could help the company in the long run, though, if Tesla’s blue-county losses are offset by red-county gains.
3 things in tech
Getty Images; Jenny Chang-Rodriguez/BI
1. Freelancers are feeling the pain of Google’s “spam” crackdown. Google’s definition of spam included many product-review articles, some written by freelancers. Now, publishers like Dotdash Meredith and Forbes have cut them loose, and their articles are dropping off sites.
2. “Severance” is a hit, but Apple TV+ isn’t. Apple has been working on Apple TV+ for six years, and with “Severance,” it’s got a certified hit: Critics love it, and so do audiences. But the streamer itself is reportedly losing $1 billion a year, and it’s unclear why Apple keeps funding it.
3. Do you want AI in your dating apps? Some apps already offer AI romantic partners, matchmakers, or dating coaches. The problem is that users aren’t sold on it.
3 things in business
Getty Images; Jenny Chang-Rodriguez/BI
1. Trump targeted 20 big law firms over DEI, but spared a GOP favorite. Twenty prominent big law firms were questioned by the federal government over their diversity programs. Jones Day, which is cozy with Trumpworld, wasn’t — even though it appears to have many of the same programs.
2. How DOGE’s cost-cutting could impact your summer vacation. National parks and nearby businesses are trying to gauge how DOGE’s cuts will affect summer travel. Visitor safety and bathroom maintenance could be impacted, and some spots say tourist bookings are already down.
3. London Heathrow Airport will be closed all day due to a power outage, causing global flight chaos. Flightradar24, a live flight-tracking platform, told BI that 120 flights already in the air were expected to be diverted, with at least 1,350 flights affected.
In other news
What’s happening today
- Deadline for New York to end congestion pricing program. Gov. Kathy Hochul and the Metropolitan Transportation Authority have sued to keep it running.
- S&P Dow Jones Indices quarterly rebalance effective after markets close.
- Shall I compare thee to a summer’s day? Happy World Poetry Day.
The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York (on parental leave). Hallam Bullock, senior editor, in London. Grace Lett, editor, in Chicago. Amanda Yen, associate editor, in New York. Lisa Ryan, executive editor, in New York. Elizabeth Casolo, fellow, in Chicago.
