Chapter 1: What actions is Paramount taking regarding Warner's board?
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Monday, January 12th, and I'm your host, Kim Kahn. Our top story so far, Paramount is making its move on Warner's board. Paramount Skydance says it plans to nominate directors to Warner Bros.
Discovery and has filed suit in Delaware seeking basic information it says Warner shareholders need to make an informed decision between its bid and the current deal with Netflix. In a letter to the Warner board, Paramount said it would also propose a bylaw amendment requiring WBD shareholder approval for any separation of global networks.
We do not undertake any of these actions lightly, the letter said. Make no mistake, our goal remains to have a constructive discussion with WBD's board to reach an agreement that's in the best interest of WBD shareholders. Adding political pressure, President Donald Trump signaled his disapproval of Netflix gaining control, reposting an opinion piece titled Stop the Netflix Cultural Takeover.
Chapter 2: How are former Fed chiefs defending Jerome Powell amidst DOJ inquiries?
Even so, odds of Netflix acquiring WBD are holding steady on prediction markets. On CalSheet, the chances stand at 54%, while PolyMarket puts the odds still at 53%.
Back to the battle in the nation's capital, several former economic officials, including Alan Greenspan, Ben Bernanke, Hank Paulson, and Janet Yellen, issued a joint statement calling the investigation into Jerome Powell and the Fed an unprecedented attempt to use prosecutorial attacks to undermine central bank independence.
This is how monetary policy is made in emerging markets, with weak institutions, with highly negative consequences for inflation and functioning of their economies more broadly, they said. It has no place in the United States whose greatest strength is the rule of law, which is at the foundation of our economic success.
And in the world of unintended consequences, the odds of Powell leaving the central bank after his chairmanship ends have tumbled. Powell's term as Fed chair ends in May, but he'll still have two years left as a governor. He hasn't said whether he'll stay or go, but speculation is that after the subpoenas, he could remain to fight for Fed independence.
On CalSheet, the proposition, Jerome Powell out as Fed governor before August 2026, is has dropped to below 50% from 85% on Saturday.
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Chapter 3: What impact does Trump's proposed credit card interest rate cap have on issuers?
Among active stocks, echoing a story from Wall Street Brunch, credit card and issuer stocks are slumping after Trump called for a one-year cap on card rates at 10%. Among the biggest decliners are Capital One, Synchrony Financial, Bread Financial, and American Express.
Abercrombie & Fitch's plunging after full-year sales guidance of 6% growth looked a bit light for a stock that's been rallying sharply since the end of November. And UnitedHealth is down after the Wall Street Journal reported that a Senate committee found it used aggressive tactics to collect payment-boosting diagnoses for its Medicare Advantage members.
Shares are off their lows, though, after the company affirmed its outlook.
Chapter 4: What are the major stock movements discussed in this episode?
And in other news of note, Eli Lilly will partner with NVIDIA on an AI co-innovation lab in San Francisco aimed at using AI to accelerate drug discovery. Lilly's scientists will work alongside NVIDIA AI model builders and engineers to generate large-scale data and build powerful AI models that can accelerate medicine development, with NVIDIA's BioNemo platform central to the effort.
The two companies plan to invest up to $1 billion in talent and infrastructure over five years.
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section.
Chapter 5: How is AI being leveraged in drug discovery by Eli Lilly and NVIDIA?
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