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    Novo Nordisk’s diabetes drug Ozempic may lower the risk of opioid overdoses, study says

    Novo Nordisk’s blockbuster diabetes drug Ozempic may decrease the risk of opioid overdoses in certain patients, according to a new study.
    The results suggest semaglutide, the active ingredient in Ozempic, could potentially become a new alternative treatment for opioid use disorder, which could help address the ongoing opioid epidemic.
    The data adds to growing evidence that a highly popular class of diabetes and obesity treatments called GLP-1s may have health benefits beyond regulating blood sugar and promoting weight loss.

    A box of Ozempic made by Novo Nordisk is seen at a pharmacy in London, Britain March 8, 2024.
    Hollie Adams | Reuters

    Novo Nordisk’s blockbuster diabetes drug Ozempic may decrease the risk of opioid overdoses in certain patients, demonstrating its potential as an alternative treatment for opioid use disorder, according to a new study released Wednesday. 
    The active ingredient in Ozempic, semaglutide, was associated with a “significantly lower” opioid overdose risk than other diabetes medications in people diagnosed with both Type 2 diabetes and opioid use disorder, said the paper published in JAMA Network Open. 

    The results suggest that Ozempic could offer potential as a tool for addressing the ongoing U.S. opioid epidemic, which was declared a public health emergency in 2017. There are currently three effective medications to prevent overdoses from opioid use disorder, but a new alternative is needed because some patients simply don’t use them, said lead study co-author Dr. Rong Xu, a biomedical informatics professor at Case Western Reserve University. 
    In 2022, only about a quarter of patients with opioid use disorder received recommended medications for it, and many discontinued treatment within six months, according to the Centers for Disease Control and Prevention. The National Center for Drug Abuse Statistics says opioids are a factor in around 72% of overdose deaths in the U.S. 
    The study results also add to mounting evidence that a highly popular class of diabetes and obesity treatments called GLP-1s may have several health benefits beyond regulating blood sugar and promoting weight loss. Novo Nordisk, its rival Eli Lilly and independent researchers have been racing to study those drugs’ potential in patients with chronic conditions ranging from kidney disease and sleep apnea to addictive behaviors such as nicotine and alcohol use.
    In the study released Wednesday, researchers from Case Western Reserve University and the National Institutes of Health analyzed the electronic records of nearly 33,000 patients who were prescribed semaglutide or other diabetes medications between December 2017 and June 2023. The study was not funded by Novo Nordisk. 
    Around 3,000 people were prescribed semaglutide injections, while the remaining patients received treatments that ranged from insulins to older GLP-1s for diabetes. That includes dulaglutide, the active ingredient in Eli Lilly’s drug Trulicity, and liraglutide, which is the active ingredient in Novo Nordisk’s Victoza. 

    Researchers monitored how many opioid overdose cases occurred in patients during a one-year period after they stopped treatment with semaglutide or other drugs. For example, there were 42 cases of opioid overdose among a group of patients that received semaglutide, compared with 97 cases among another group that received insulins, according to the study. 
    That reflects a 58% lower risk of opioid overdose in patients who took semaglutide, Xu said.  
    But Xu noted the study has limitations since it relies on data from electronic health records.

    More CNBC health coverage

    More research, specifically clinical trials that randomly assign patients to receive semaglutide or other treatments, is needed to confirm how much Ozempic and other GLP-1s can help those with opioid use disorder, according to the study authors. Those randomized studies can also determine whether those treatments are beneficial to the general opioid use disorder population or only certain patients with the condition.
    “The extent to which GLP-1 medications could benefit treatment of opioid use disorders and help prevent overdoses is unclear,” Dr. Nora Volkow, lead study co-author and director of the National Institute on Drug Abuse of the National Institutes of Health, said in a statement to CNBC. “The preliminary findings from this study point to the possibility that GLP-1 medications may have value in helping to prevent opioid overdoses.”
    Xu added that the researchers plan to study semaglutide in patients with opioid use disorder and obesity. 

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    New Starbucks CEO Brian Niccol commits to working with union as talks move forward

    Starbucks CEO Brian Niccol said he respects the rights of the coffee chain’s baristas to unionize.
    Starbucks and Workers United are negotiating a framework for collective bargaining agreements for unionized cafes.
    Today, Workers United represents more than 490 of Starbucks’ U.S. cafes and more than 10,500 of its employees.

    A Starbucks worker wears a t-shirt and button promoting unionization on April 7, 2022, in Chicago. 
    John J. Kim | Chicago Tribune | Tribune News Service | Getty Images

    Starbucks CEO Brian Niccol said the coffee chain is committed to bargaining in good faith with the union that represents many of its baristas, as the two sides work to craft a labor deal.
    “I deeply respect the right of partners to choose, through a fair and democratic process, to be represented by a union,” Niccol wrote on Tuesday in a letter to the union obtained by CNBC. “If our partners choose to be represented, I am committed to making sure we engage constructively and in good faith with the union and the partners it represents.”

    He was responding to a letter from the Starbucks Workers United bargaining delegation sent a day earlier, ahead of another bargaining session between Starbucks and the union. The two sides are negotiating a framework that would be the basis for collective bargaining agreements between individual stores and the company. The union is pushing for fair scheduling, a living wage, and racial and gender equity, the delegation said in its letter.
    “We know that many of your dedicated customers — as well as future generations of customers — have a vested interest in the outcome of our negotiations and reaching a foundational agreement,” the group wrote in its letter to Niccol.
    Three years ago, Starbucks baristas started unionizing under Workers United, an affiliate of the Service Employees International Union. For two and a half years, the coffee giant tried to curb the union push, leading to battles that played out in headlines, social media and courts.
    But the turning point for both parties came six months ago when they agreed to work together on a path forward after mediation to resolve lawsuits sparked by the union’s posts on social media.
    Niccol joined Starbucks several weeks ago, making him a newcomer to the union discussions. In his previous role as CEO of Chipotle Mexican Grill, only one location, in Lansing, Michigan, successfully unionized. Last year, the burrito chain agreed to pay former employees of an Augusta, Maine, location $240,000 as part of a settlement for closing the restaurant when workers tried to unionize. Chipotle denied any wrongdoing.
    Today, Workers United represents more than 490 of Starbucks’ U.S. cafes and more than 10,500 of its employees. The company has more than 16,700 locations in the U.S., more than half of which are owned by the company. More

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    How birria took over restaurant menus across the country

    Once a regional Mexican food, birria has seen its presence on U.S. menus more than quintuple over the past four years, according to Datassential.
    Mexican-inspired chains such as Qdoba and Del Taco have added their own versions to their menus, while eateries with broader menus have also adopted it.
    Birria’s versatility and flavor has helped it grow from being a specific dish to a protein found across menus and in many different foods.

    Birria burrito surrounded by birria tacos, birria munchwrap, birria loaded fries and birria consommé at Little Miner Taco in North Bethesda, Maryland.
    Laura Chase de Formigny | The Washington Post | Getty Images

    Birria, which was once known as a regional Mexican food, has taken on a life of its own in the U.S., becoming a social media star and fast-food darling.
    Traditionally, birria is a beef or goat stew, slow cooked with spices and chiles to give the meat lots of flavor. Birria tacos use the slow-cooked meat as a filling and usually include a consommé on the side to dip the taco.

    Over the past four years, birria has seen its presence on restaurant menus grow 412%, largely thanks to midscale and casual-dining chains, according to market research firm Datassential. It has made the jump from Mexican-focused restaurants to eateries with broader menus, such as Sugar Factory’s American dining spots and Bowlero’s bowling alleys.
    Mexican-inspired fast-food brands such as Qdoba, El Pollo Loco, Del Taco and even Taco Bell have released their own versions of birria, turning it into a new menu staple. And the dish is still growing. Datassential predicts that birria’s menu penetration will more than double over the next four years.

    From Jalisco to TikTok

    The Birria Tacos at Mariscos 1133 Restaurant in Washington, D.C.
    Scott Suchman | The Washington Post | Getty Images

    While birria might be newer to U.S. diners, it has been around for centuries in Jalisco, a Mexican state that borders the Pacific Ocean.
    Goats, which were originally brought over by Spaniards, had become an invasive species, and eating them was an easy way to take care of the problem, according to Steven Alvarez, a St. John’s University professor who teaches a class on taco literacy. But making goat tasty required spices and chiles. Slow cooking the meat made it tender.
    “The goat comes from Europe, the chiles — the guajillo peppers, ancho peppers — are native to the Americas, and they come together to make this thing that is distinctly new,” Alvarez said.

    The dish migrated up to Tijuana, Mexico. There, in the 1950s, a taco vendor named Don Guadalupe Zárate swapped out goat for beef because it was cheaper, according to Alvarez. Adding water to make it a stew kept the meat from burning.
    Over the past decade, birria moved north, to Los Angeles, where Mexican immigrants dished out tacos and consommé from food trucks such as Birrieria Gonzalez.
    “What’s beautiful about [southern California] is that the Mexican food is always, constantly regenerated by what’s going on in Mexico, based on the immigration patterns,” Alvarez said.
    More recently, birria took off in New York City, with restaurants and food trucks serving up tacos and consommé across the five boroughs.
    But the true inflection point for birria came thanks to Instagram. Food influencers’ photos of birria tacos, with their beef cascading down into a cup of consommé, made mouths water, and introduced a new audience to the food, according to Alvarez. Once TikTok took off, so did videos of birria, whether for reviews of the restaurants and food trucks serving it or for recipes to make it at home.

    Finding opportunity

    Qdoba’s Brisket Birria, seen here in the chain’s quesadillas.
    Source: Qdoba

    Social media is partly why birria became a staple on Qdoba’s menu.
    Katy Velazquez, director of culinary innovation for Qdoba, was first introduced to birria while in Mexico for a previous job. Later, while back in the U.S., she started seeing the food pick up online, thanks to “sexy cheese pull shots” on social media, she said.
    Cut to the Covid-19 pandemic, when brisket prices were soaring, and Qdoba had to remove its Tex Mex-inspired version of brisket from its menu.
    “We were losing money on every entrée that we sold,” Velazquez said.
    But that loss gave her team the opportunity to create their own take on birria, using brisket as its base. The fast-casual chain’s final product is not made the same way that traditional birria is, but Velazquez and her team aimed to emulate the same flavor and tenderness.
    “We get the benefit of seasonings that have hours of tomatoes that are reduced and simmered and then they get dehydrated and brought into it, so we get the same effect and flavor without hours and hours of work,” she said.
    Qdoba introduced its birria two years ago, replacing its previous brisket entree permanently and charging customers extra for the new protein option. Since the chain is privately owned by Butterfly Equity, it does not disclose its financial results, including more details about the success of the launch.
    This fall, the chain is repromoting its birria offerings, betting that its flavor will appeal to customers looking for a cozy lunch or dinner, Velazquez said.
    “We’re really proud of it, and we’re proud to be able to bring something that was a regional Mexican cuisine to a really large audience at a brand like ours,” she added.

    Birria everything

    Lamb is seasoned for lamb birria in Oakland, California.
    Liz Hafalia | San Francisco Chronicle | Hearst Newspapers | Getty Images

    Birria’s fanbase is not growing just because Qdoba and other large restaurant chains have added it to their menus. It is also because of its own versatility, Christine Couvelier, a culinary trendspotter and founder of the Culinary Concierge, told CNBC.
    “This is a dish that is not about heat — it’s flavor,” Couvelier said. “So when consumers try it on a menu, they aren’t afraid or surprised. This is a flavor that is cooked low and slow.”
    Couvelier envisions many different possible iterations for birria: on top of poutine, in soups and even stuffed in ravioli. She has also started to see some packaged food companies experiment with sauces that include the flavors of birria.
    “It has switched from a specific dish to a protein and can be found across the menu,” said Claire Conaghan, Datassential trendologist and associate director.
    Now that birria is usually made using beef, it can be paired with nearly anything, Conaghan added.
    According to Datassential, tacos are the most popular birria dishes found on menus, but the firm’s Menu Trends platform has also found birria quesadillas, grilled cheese, breakfast dishes and even ramen.
    Birria ramen first popped up in Tijuana, Mexico, according to Alvarez. But it has made its way stateside, and even appeared on Del Taco’s menu.
    Jeremias Aguayo, Del Taco’s senior director of culinary research and development, rejoined the chain’s culinary team in 2022, shortly after Jack in the Box bought Del Taco. He personally took on the goal of creating Del Taco’s take on birria.
    The consommé recipe alone took Aguayo four months and 17 attempts to make just right, he said. At the same time, Del Taco came up with its beef birria recipe. The chain launched its quesabirria taco, birria quesadilla and birria ramen at the same time last November.
    The result was Del Taco’s biggest promotion in years, leading to “big jumps” in sales, traffic and check average, according to Aguayo. Del Taco sold upward of one million birria ramen at more than 600 restaurants over two promotional windows. More

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    China likely needs more than rate cuts to boost economic growth

    China’s slowing economy needs more than interest rate cuts to boost growth, analysts said.
    “We will need a major fiscal policy support to see higher CNY government bond yields,” said Edmund Goh, head of China fixed income at abrdn.
    There’s still a 1 trillion yuan shortfall in spending if Beijing is to meet its fiscal target for the year, according to an analysis by CF40, a major Chinese think tank focusing on finance and macroeconomic policy.

    A China Resources property under construction in Nanjing, Jiangsu province, China, Sept 24, 2024. 
    Cfoto | Future Publishing | Getty Images

    BEIJING — China’s slowing economy needs more than interest rate cuts to boost growth, analysts said.
    The People’s Bank of China on Tuesday surprised markets by announcing plans to cut a number of rates, including that of existing mortgages. Mainland Chinese stocks jumped on the news.

    The move may mark “the beginning of the end of China’s longest deflationary streak since 1999,” Larry Hu, chief China economist at Macquarie, said in a note. The country has been struggling with weak domestic demand.
    “The most likely path to reflation, in our view, is through fiscal spending on housing, financed by the PBOC’s balance sheet,” he said, stressing that more fiscal support is needed, in addition to more efforts to bolster the housing market.
    The bond market reflected more caution than stocks. The Chinese 10-year government yield fell to a record low of 2% after the rate cut news, before climbing to around 2.07%. That’s still well below the U.S. 10-year Treasury yield of 3.74%. Bond yields move inversely to price.
    “We will need major fiscal policy support to see higher CNY government bond yields,” said Edmund Goh, head of China fixed income at abrdn. He expects Beijing will likely ramp up fiscal stimulus due to weak growth, despite reluctance so far.
    “The gap between the U.S. and Chinese short end bond rates are wide enough to guarantee that there’s almost no chance that the US rates would drop below those of the Chinese in the next 12 months,” he said. “China is also cutting rates.”

    The differential between U.S. and Chinese government bond yields reflects how market expectations for growth in the world’s two largest economies have diverged. For years, the Chinese yield had traded well above that of the U.S., giving investors an incentive to park capital in the fast-growing developing economy versus slower growth in the U.S.
    That changed in April 2022. The Fed’s aggressive rate hikes sent U.S. yields climbing above their Chinese counterpart for the first time in more than a decade.
    The trend has persisted, with the gap between the U.S. and Chinese yields widening even after the Fed shifted to an easing cycle last week.
    “The market is forming a medium to long-term expectation on the U.S. growth rate, the inflation rate. [The Fed] cutting 50 basis points doesn’t change this outlook much,” said Yifei Ding, senior fixed income portfolio manager at Invesco.
    As for Chinese government bonds, Ding said the firm has a “neutral” view and expects the Chinese yields to remain relatively low.
    China’s economy grew by 5% in the first half of the year, but there are concerns that full-year growth could miss the country’s target of around 5% without additional stimulus. Industrial activity has slowed, while retail sales have grown by barely more than 2% year-on-year in recent months.

    Fiscal stimulus hopes

    China’s Ministry of Finance has remained conservative. Despite a rare increase in the fiscal deficit to 3.8% in Oct. 2023 with the issuance of special bonds, authorities in March this year reverted to their usual 3% deficit target.
    There’s still a 1 trillion yuan shortfall in spending if Beijing is to meet its fiscal target for the year, according to an analysis released Tuesday by CF40, a major Chinese think tank focusing on finance and macroeconomic policy. That’s based on government revenue trends and assuming planned spending goes ahead.
    “If general budget revenue growth does not rebound significantly in the second half of the year, it may be necessary to increase the deficit and issue additional treasury bonds in a timely manner to fill the revenue gap,” the CF40 research report said.
    Asked Tuesday about the downward trend in Chinese government bond yields, PBOC Gov. Pan Gongsheng partly attributed it to a slower increase in government bond issuance. He said the central bank was working with the Ministry of Finance on the pace of bond issuance.
    The PBOC earlier this year repeatedly warned the market about the risks of piling into a one-sided bet that bond prices would only rise, while yields fell.
    Analysts generally don’t expect the Chinese 10-year government bond yield to drop significantly in the near future.
    After the PBOC’s announced rate cuts, “market sentiment has changed significantly, and confidence in the acceleration of economic growth has improved,” Haizhong Chang, executive director of Fitch (China) Bohua Credit Ratings, said in an email. “Based on the above changes, we expect that in the short term, the 10-year Chinese treasury bond will run above 2%, and will not easily fall through.”
    He pointed out that monetary easing still requires fiscal stimulus “to achieve the effect of expanding credit and transmitting money to the real economy.”
    That’s because high leverage in Chinese corporates and households makes them unwilling to borrow more, Chang said. “This has also led to a weakening of the marginal effects of loose monetary policy.”

    Breathing room on rates

    The U.S. Federal Reserve’s rate cut last week theoretically eases pressure on Chinese policymakers. Easier U.S. policy weakens the dollar against the Chinese yuan, bolstering exports, a rare bright spot of growth in China.
    China’s offshore yuan briefly hit its strongest level against the U.S. dollar in more than a year on Wednesday morning.
    “Lower U.S. interest rates provide relief on China’s FX market and capital flows, thus easing the external constraint that the high U.S. rates have imposed on the PBOC’s monetary policy in recent years,” Louis Kuijs, APAC Chief Economist at S&P Global Ratings, pointed out in an email Monday.
    For China’s economic growth, he is still looking for more fiscal stimulus: “Fiscal expenditure lags the 2024 budget allocation, bond issuance has been slow, and there are no signs of substantial fiscal stimulus plans.” More

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    Caught cold by UniCredit’s swoop on Commerzbank, Germany will want to avoid a national embarrassment

    Italy’s UniCredit appears to have caught German authorities off guard with a potential multibillion euro merger of Frankfurt-based Commerzbank.
    Market observers told CNBC on Tuesday that the swoop may have provoked a sense of national embarrassment among Germany’s government, while it’s been argued that the outcome of the takeover attempt could put the meaning of the European project at stake.
    Milan-based UniCredit announced on Monday that it had increased its stake in Commerzbank to around 21% and submitted a request to boost that holding to up to 29.9%.

    A protestor holds a placard with a slogan reading “Stop Merger Horror” during a union demonstration outside the Commerzbank AG headquarters in Frankfurt, Germany, on Tuesday, Sept. 24, 2024.
    Bloomberg | Bloomberg | Getty Images

    Italy’s UniCredit appears to have caught German authorities off guard with a potential multibillion-euro merger of Frankfurt-based Commerzbank, a move that has triggered a fiery response from Berlin.
    Market observers told CNBC that the swoop may have provoked a sense of national embarrassment among Germany’s government, which firmly opposes the move, while it’s been argued that the outcome of the takeover attempt could even put the meaning of the European project at stake.

    Milan-based UniCredit announced on Monday that it had increased its stake in Commerzbank to around 21% and submitted a request to boost that holding to up to 29.9%. It follows UniCredit’s move to take a 9% stake in Commerzbank earlier this month.
    “If UniCredit can take Commerzbank and take it to their level of efficiency, there’s a tremendous upside in terms of increased profitability,” Octavio Marenzi, CEO of consulting firm Opimas, told CNBC’s “Squawk Box Europe” on Tuesday.
    “But [German Chancellor] Olaf Scholz is not an investor. He’s a politician and he’s very concerned about the jobs side of things. And if you look at what UniCredit has done in terms of slimming down things in its Italian operations or particularly in its German operations, it’s been quite impressive,” Marenzi said.

    Scholz on Monday criticized UniCredit’s decision to up the ante on Commerzbank, describing the move as an “unfriendly” and “hostile” attack, Reuters reported.
    Commerzbank’s Deputy Chair Uwe Tschaege, meanwhile, reportedly voiced opposition to a potential takeover by UniCredit on Tuesday. Speaking outside of the lender’s headquarters in central Frankfurt, Tschaege said the message was simple and clear: “We don’t want this.”

    “I feel like vomiting when I hear his promises of cost savings,” Tschaege reportedly added, referring to UniCredit ‘s CEO Andrea Orcel.
    Separately, Stefan Wittman, a Commerzbank supervisory board member, told CNBC on Tuesday that as many as two-thirds of the jobs at the bank could disappear if UniCredit successfully carries out a hostile takeover.
    The bank has yet to respond to a request for comment on Wittmann’s statement.

    Hostile takeover bids are not common in the European banking sector, although Spanish bank BBVA shocked markets in May when it launched an all-share takeover offer for domestic rival Banco Sabadell. The latter Spanish lender rejected the bid.
    Opimas’ Marenzi said the German government and trade unions “are basically looking at this and saying this means we could lose a bunch of jobs in the process — and it could be quite substantial job losses.”
    “The other thing is there might be a bit of a national embarrassment that the Italians are coming in and showing them how to run their banks,” he added.
    A spokesperson for Germany’s government was not immediately available when contacted by CNBC on Tuesday.
    Germany’s Scholz has previously pushed for the completion of a European banking union. Designed in the wake of the 2008 global financial crisis, the European Union’s executive arm announced plans to create a banking union to improve the regulation and supervision of lenders across the region.

    What’s at stake?

    Craig Coben, former global head of equity capital markets at Bank of America, said the German government would need to find “very good” reasons to block UniCredit’s move on Commerzbank, warning that it would also have to be consistent with the principles around European integration.
    “I think it is very difficult for UniCredit to take over or to reach an agreement on Commerzbank without the approval of the German government, just as a practical matter — but I think Germany needs to find a legitimate excuse if it wants to intervene [or] if it wants to block the approach from UniCredit,” Coben told CNBC’s “Squawk Box Europe” on Tuesday.

    The Commerzbank AG headquarters, in the financial district of Frankfurt, Germany, on Thursday, Sept. 12, 2024.
    Emanuele Cremaschi | Getty Images News | Getty Images

    “Germany has signed up to the [EU’s] single market, it has signed up to the single currency, it has signed up to [the] banking union and so it would be inconsistent with those principles to block the merger on the grounds of national interest,” he continued.
    “And I think that’s really what’s at stake here: what is the meaning of [the] banking union? And what is the meaning of the European project?”
    Former European Central Bank chief Mario Draghi said in a report published earlier this month that the European Union needs hundreds of billions of euros in additional investment to meet its key competitiveness targets.
    Draghi, who has previously served as Italian prime minister, also cited the “incomplete” banking union in the report as one factor that continues to hinder competitiveness for the region’s banks.
    — CNBC’s April Roach contributed to this report. More

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    Justice Department accuses Visa of debit network monopoly that affects price of ‘nearly everything’

    The U.S. Department of Justice on Tuesday sued Visa, the world’s biggest payments network, saying it propped up an illegal monopoly over debit payments.
    The DOJ said Visa imposed “exclusionary” agreements on partners and smothered upstart firms.
    Visa and its smaller rival Mastercard have surged over the past two decades, reaching a combined market cap of roughly $1 trillion.

    Justin Sullivan | etty Images

    The U.S. Justice Department on Tuesday sued Visa, the world’s biggest payments network, saying it propped up an illegal monopoly over debit payments by imposing “exclusionary” agreements on partners and smothering upstart firms.
    Visa’s moves over the years have resulted in American consumers and merchants paying billions of dollars in additional fees, according to the DOJ, which filed a civil antitrust suit in New York for “monopolization” and other unlawful conduct.

    “We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market,” Attorney General Merrick Garland said in a DOJ release.
    “Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service,” Garland said. “As a result, Visa’s unlawful conduct affects not just the price of one thing — but the price of nearly everything.”
    Visa and its smaller rival Mastercard have surged over the past two decades, reaching a combined market cap of roughly $1 trillion, as consumers tapped credit and debit cards for store purchases and e-commerce instead of paper money. They are essentially toll collectors, shuffling payments between banks operating for the merchants and for cardholders.
    Visa called the DOJ suit “meritless.”
    “Anyone who has bought something online, or checked out at a store, knows there is an ever-expanding universe of companies offering new ways to pay for goods and services,” said Visa general counsel Julie Rottenberg.

    “Today’s lawsuit ignores the reality that Visa is just one of many competitors in a debit space that is growing, with entrants who are thriving,” Rottenberg said. “We are proud of the payments network we have built, the innovation we advance, and the economic opportunity we enable.”
    More than 60% of debit transactions in the U.S. run over Visa rails, helping it charge more than $7 billion annually in processing fees, according to the DOJ complaint.
    The payment networks’ decades-old dominance has increasingly attracted attention from regulators and retailers.

    Litany of woes

    In 2020, the DOJ filed an antitrust suit to block Visa from acquiring fintech company Plaid. The companies initially said they would fight the action, but soon abandoned the $5.3 billion takeover.
    In March, Visa and Mastercard agreed to limit their fees and let merchants charge customers for using credit cards, a deal retailers said was worth $30 billion in savings over a half decade. A federal judge later rejected the settlement, saying the networks could afford to pay for a “substantially greater” deal.
    In its complaint, the DOJ said Visa threatens merchants and their banks with punitive rates if they route a “meaningful share” of debit transactions to competitors, helping maintain Visa’s network moat. The contracts help insulate three-quarters of Visa’s debit volume from fair competition, the DOJ said.
    “Visa wields its dominance, enormous scale, and centrality to the debit ecosystem to impose a web of exclusionary agreements on merchants and banks,” the DOJ said in its release. “These agreements penalize Visa’s customers who route transactions to a different debit network or alternative payment system.”
    Furthermore, when faced with threats, Visa “engaged in a deliberate and reinforcing course of conduct to cut off competition and prevent rivals from gaining the scale, share, and data necessary to compete,” the DOJ said.

    Paying off competitors

    The moves also tamped down innovation, according to the DOJ. Visa pays competitors hundreds of millions of dollars annually “to blunt the risk they develop innovative new technologies that could advance the industry but would otherwise threaten Visa’s monopoly profits,” according to the complaint.
    Visa has agreements with tech players including Apple, PayPal and Square, turning them from potential rivals to partners in a way that hurts the public, the DOJ said.
    For instance, Visa chose to sign an agreement with a predecessor to the Cash App product to ensure that the company, later rebranded Block, did not create a bigger threat to Visa’s debit rails.
    A Visa manager was quoted as saying “we’ve got Square on a short leash and our deal structure was meant to protect against disintermediation,” according to the complaint.
    Visa has an agreement with Apple in which the tech giant says it will not directly compete with the payment network “such as creating payment functionality that relies primarily on non-Visa payment processes,” the complaint alleged.
    The DOJ asked for the courts to prevent Visa from a range of anticompetitive practices, including fee structures or service bundles that discourage new entrants.
    The move comes in the waning months of President Joe Biden’s administration, in which regulators including the Federal Trade Commission and the Consumer Financial Protection Bureau have sued middlemen for drug prices and pushed back against so-called junk fees.
    In February, credit card lender Capital One announced its acquisition of Discover Financial, a $35.3 billion deal predicated in part on Capital One’s ability to bolster Discover’s also-ran payments network, a distant No. 4 behind Visa, Mastercard and American Express.
    Capital One said once the deal is closed, it will switch all its debit card volume and a growing share of credit card volume to Discover over time, making it a more viable competitor to Visa and Mastercard.

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    Can Israel’s economy survive an all-out war with Hizbullah?

    Israel’s economy should have been trundling towards recovery. After all, many of the 300,000 workers who left their jobs to fight have now returned to offices, factories and farms. Instead, a difficult situation is becoming ever more acute. GDP growth came to just 0.7% between April and June, on an annualised basis, some 5.2 percentage points below economists’ expectations, according to Bloomberg, a news agency. On September 16th Bezalel Smotrich, Israel’s finance minister, was forced to ask legislators to approve an emergency deficit increase. It was the second time he had made such a request this year. More

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    Nvidia shares pop as CEO may be done selling shares after hitting preset plan limit

    Nvidia CEO Jensen Huang is done selling the chipmaker’s stock for the time being, cashing in more than $700 million under a prearranged plan.
    The executive in mid-March adopted a trading plan for the sale of up to six million Nvidia shares by the end of the first quarter of 2025.
    The chipmaker has been the biggest beneficiary of the artificial intelligence boom.

    Nvidia CEO Jensen Huang talks onstage with Salesforce CEO Marc Benioff during Salesforce’s Dreamforce in San Francisco on Sept. 17, 2024.
    Justin Sullivan | Getty Images News | Getty Images

    Nvidia CEO Jensen Huang is done selling the chipmaker’s stock for the time being, cashing in more than $700 million under a prearranged plan.
    The 61-year-old executive in mid-March adopted a trading plan for the sale of up to six million Nvidia shares by the end of the first quarter of 2025. Huang has hit that threshold months ahead of schedule after a flurry of transactions between June 13 and Sept. 12, according to a new regulatory filing.

    Even though the sales were made under a 10b5-1 plan, which allows insiders to sell shares under a preplanned structure, Nvidia shares seemed to get a boost from the update Tuesday, trading more than 4% higher.

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    The chipmaker has been the biggest beneficiary of the artificial intelligence boom, with shares rallying more than 140% this year. Nvidia briefly topped a $3 trillion market cap earlier this year, and its dominance has grown so big that it tends to influence the broader market and investor sentiment.
    Nvidia declined CNBC’s request for comment.
    Barron’s first reported on the completion of Huang’s preplanned sales Tuesday.
    After the sales, Huang now holds 75.4 million Nvidia shares and another 786 million shares through different trusts and a partnership, according to a separate filing. In the company’s latest proxy statement, Huang was listed as the company’s largest individual shareholder.
    Nvidia sells processors that are powering the generative AI boom and services such as OpenAI’s ChatGPT. The company counts Microsoft, Meta, Alphabet, Amazon and Oracle as its main customers.

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