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Ford has harsh words for striking UAW workers

The company delivered a stern message to workers regarding their latest decision.

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The United Auto Workers strike took a turn for the worse when the union announced stalled progress in its negotiations with Ford Motor  (F) - Get Free Report, resulting in more workers heading for the picket lines. 

The news didn't sit well with Ford, particularly given the UAW workers' latest target for its "stand-up" strike, which will impact the production of highly profitable trucks and SUVs. 

The potential hit to Ford's sales due to production headwinds drew a stern rebuke from the Detroit automaker that's unlikely to win over workers.

CHICAGO, ILLINOIS - OCTOBER 7: UAW members attend a rally in support of the labor union strike at the UAW Local 551 hall on the South Side on October 7, 2023 in Chicago, Illinois. UAW president Shawn Fain joined members in solidarity with the ongoing strike. (Photo by Jim Vondruska/Getty Images)

Jim Vondruska/Getty Images

Striking UAW workers demand a record contract

The big three U.S. automakers, Ford, General Motors  (GM) - Get Free Report, and Stellantis'  (STLA,) - Get Free Report have enjoyed record profits since the Covid pandemic. 

A surge in worker wages, government stimulus payments, and low-interest rates catapulted auto sales as inventories shrank because of pandemic-era lockdowns. 

Related: General Motors gets 'cold shoulder' from UAW workers

Increasing demand provided automakers with newfound pricing power, and even though interest rates have risen and stimulus payments are over, a strong jobs market has kept sales humming along, boosting revenue by billions of dollars.

UAW workers argue that it's time for Detroit's big three to share the wealth. They're demanding a 40% wage increase, 32-hour workweeks, a return to pre-Great Recession pensions, and a faster path to the top tier of hourly earnings.

Ford has previously said that meeting those demands would put it on a path to bankruptcy, an argument the UAW has dismissed. 

For instance, the UAW recently pointed out that General Motors spent more on share buybacks than it did on labor over the past decade. It's also said that automakers like Ford would still have pocketed billions of dollars in profits if they had previously agreed to its terms.

The back-and-forth between the two sides suggests that the strike could worsen if a negotiation breakthrough doesn't happen.

Ford issues stern rebuke over UAW decision

The impasse on Oct. 12 caused the UAW to call on more local members to go on strike.

Workers at Ford's Kentucky Truck plant responsible for producing Super Duty pickup trucks, the Expedition, and Lincoln's Navigator SUV hit the picket line, bringing the total number of striking workers to about 34,000. 

“It’s time for a fair contract at Ford and the rest of the Big Three. If they can’t understand that after four weeks, the 8,700 workers shutting down this extremely profitable plant will help them understand it,” said UAW President Shawn Fain.

More UAW strike

The UAW's decision followed a terse 10-minute meeting between union representatives and Ford management. 

Ford wasn't impressed. A statement responding to the new strike called the decision "grossly irresponsible" and "wrongheaded."

The Kentucky Truck plant is Ford’s most significant plant. It's also one of the world's largest auto factories, accounting for $25 billion annually in revenue. Analysts at Wells Fargo estimate that shutting down the plant could cost Ford $150 million weekly in profit. 

The decision to strike there will likely have ripple effects throughout Ford's supply chain. Over 5,000 workers at Ford, GM, and Stellantis have already been laid off because of production disruptions caused by striking workers. That number is likely to increase.

Ford says, "approximately a dozen additional Ford operations and many more supplier operations that together employ well over 100,000 people" could be impacted.

One area of contention leading to the expansion of the UAW strike may be Ford's hesitancy toward including future electric vehicle battery workers in any new contract. 

Electric vehicles are quickly displacing internal combustion engine (ICE) vehicles, prompting significant investments in EV infrastructure, including batteries necessary to operate them. General Motors agreed on Oct. 6 to include battery workers in negotiations. However, Ford and Stellantis haven't made that decision yet. 

Automakers likely worry that expanding contracts to EV-related plants could disadvantage them when competing with Tesla  (TSLA) - Get Free Report, Toyota Motor  (TM) - Get Free Report, Honda  (HMC) - Get Free Report, and others less exposed to the higher labor costs associated with union workers.

Tesla's 120,000 non-union employees receive average wages and benefits totaling about $55 per hour, over $10 per hour less than GM, Ford, and Stellantis union workers. 

Higher costs that could widen that gap could make competing for market share more difficult. According to Cox Automotive, EV sales rose 49.8% year-over-year in the third quarter to 313,000 vehicles. Tesla's market share was 50%, selling over 156,000 EVs in the quarter. Ford was the second largest EV maker, selling 21,000 vehicles.

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Ferrari to accept crypto payments in the US

Ferrari’s decision to accept cryptocurrency payments was driven by market demand and dealer requests, with numerous clients investing in digital currencies.

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Ferrari’s decision to accept cryptocurrency payments was driven by market demand and dealer requests, with numerous clients investing in digital currencies.

Ferrari will accept cryptocurrency payments for its luxury sports cars in the United States due to customer demand. The carmaker also plans to accept crypto payments in Europe.

According to an Oct. 14 report from Reuters, Ferrari’s chief marketing and commercial officer, Enrico Galliera, confirmed the intentions of the luxury car brand. Ferrari’s choice to accept cryptocurrency payments was driven by market demand and dealer requests, with numerous clients, including crypto-savvy young investors, having invested in digital currencies.

Although Galliera didn’t specify the number of cars Ferrari expects to sell via crypto payments, he reportedly stated that the carmaker’s strong order portfolio is fully booked until 2025. Ferrari aims to test this expanding market to connect with potential buyers beyond its usual clientele. The luxury automaker plans to introduce cryptocurrency payments in Europe by the first quarter of 2024 and expand to other crypto-friendly regions after.

For its initial phase in the U.S., Ferrari has reportedly partnered with major cryptocurrency payment processor, BitPay. This collaboration enables transactions in Bitcoin (BTC), Ether (ETH) and USD Coin (USDC).

Galliera confirmed that there will be no additional fees or surcharges when using cryptocurrency, as BitPay will promptly convert cryptocurrency payments into conventional fiat currency for Ferrari’s dealers, ensuring they are shielded from cryptocurrency price fluctuations.

BitPay will also verify the legitimacy of the digital currency, ensuring it does not originate from illicit activities, money laundering or tax evasion.

Related: Madeira announces creation of Bitcoin business hub for innovation

Many large corporations have hesitated to adopt cryptocurrencies due to their price volatility and associated transaction impracticality. Among these companies is Tesla, the electric vehicle manufacturer, which initially started accepting payments in Bitcoin in 2021. However, CEO Elon Musk suspended this payment method due to environmental concerns.

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Caroline Ellison wanted to step down but feared a bank run on FTX

Former Alameda CEO Caroline Ellison recognized she wasn’t doing a good job months before the company filed for bankruptcy, but Sam Bankman-Fried persuaded…

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Former Alameda CEO Caroline Ellison recognized she wasn’t doing a good job months before the company filed for bankruptcy, but Sam Bankman-Fried persuaded her to stay.

Caroline Ellison wasn’t doing a good job leading Alameda Research in 2022, and she did not hide it. Excerpts from her personal notes shared as evidence by prosecutors in Sam Bankman-Fried’s trial revealed details about the trading firm’s struggles and its CEO’s desire to resign weeks and months before FTX collapsed.

Ellison spent over 10 hours testifying during Bankman-Fried’s trial this past week, notably entering through the front doors of the United States District Court for the Southern District of New York in Manhattan, joined by her attorneys. Ellison said she had not seen Bankman-Fried since the crypto empire failed in November 2022, but their communication had eroded months before.

In April 2022, their romantic relationship ended, and Caroline started avoiding meetings with Bankman-Fried even though they still lived in the same luxurious apartment in the Bahamas. Alameda’s growing liabilities with FTX and the breakup with Bankman-Fried made her consider leaving the company altogether.

“I feel like neither [Sam] Trabucco nor I have been doing a great job of pushing on stuff,” she wrote in the document to Bankman-Fried, which was shared as evidence during her cross-examination by the former FTX CEO’s defense counsel.

Bankman-Fried asked her to stay on, saying that her departure could create rumors about Alameda’s financial health, thus harming FTX’s credibility, so Ellison remained CEO.

Ellison joined Alameda as a trader in 2018. By 2020, she handled most of the company’s operations, while Bankman-Fried focused on his newly launched crypto exchange, FTX. In August 2021, she became co-CEO alongside Sam Trabucco, who stepped down a few months later, leaving her in charge of the company. In August 2022, Trabucco officially resigned as co-CEO.

Ellison was against creating FTX, she revealed. “I didn’t think of myself as ambitious before I started at Alameda, but I believe I became more ambitious” under Bankman-Fried’s incentive, she said.

As CEO, Ellison was in charge of handling Alameda’s crypto lenders. In mid-2022, after the Terra ecosystem failed, the company’s open-term loans stood at $1.3 billion. The market downturn drained liquidity from crypto assets, prompting Alameda’s lenders to demand loan repayments.

According to Ellison, Bankman-Fried instructed her to keep repaying creditors via Alameda’s line of credit with FTX. In other words, Alameda would use FTX’s customer assets to repay crypto lenders. At the time, its line of credit with the exchange stood at $13 billion.

As lenders demanded loan repayments and Alameda’s balance sheets, Bankman-Fried suggested Ellison use “alternative means” for presenting the company’s financials. In the following months, Ellison would create many additional versions of a balance sheet to deceive creditors.

Early in November 2022, an alternative version of Alameda’s balance sheet was leaked. Ellison was on vacation in Japan at the time, but she had to travel to FTX Hong Kong’s office to deal with the company’s crisis.

While the balance sheet data didn’t reflect the company’s reality, it was enough to spread rumors and trigger a bank run on FTX a few days later, exposing an $8 billion gap between the companies.

Having cooperated with the U.S. Department of Justice since December 2022, Ellison will soon receive her sentence regarding the seven counts of fraud and conspiracy to commit fraud she was charged with.

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ProShares prepares to launch unique Short Ether Strategy ETF

ProShares’ SETH ETF will start trading soon, following the first Ethereum futures ETFs by about two weeks.
ProShares introduced a trio…

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ProShares' SETH ETF will start trading soon, following the first Ethereum futures ETFs by about two weeks.

ProShares introduced a trio of Ethereum futures ETFs in the recent weeks. Presently, the company is gearing up to provide a distinctive offering.

ProShares' Short Ether Strategy ETF (SETH) from the fund group is poised to commence trading shortly, following the debut of the initial Ethereum futures ETFs by about two weeks.

SETH, scheduled for listing on the NYSE Arca exchange, aims to achieve daily investment outcomes that mirror the inverse of the daily S&P CME Ether Futures Index performance, as indicated in a filing made on Friday, Oct. 13.

The fund does not engage in direct shorting of ether (ETH); rather, it seeks to capitalize on potential declines in the asset's value, as stated in the prospectus. On Friday, the price of ETH stood at approximately $1,540, reflecting a decrease of approximately 6% over the past week.

Screenshot of the ProShares SETH filing     Source: SEC

ProShares anticipates that the registration statement for SETH will become effective on Oct. 15 and plans to introduce the fund in early November, as reported by Blockworks.

However, the three existing ProShares ether futures funds — including two that invest in both ether and bitcoin futures contracts — debuted on Oct. 2 alongside similar products by VanEck and Bitwise.

The US Securities and Exchange Commission approved ether futures ETFs two years following the introduction of the initial bitcoin futures ETF, the ProShares Bitcoin Strategy ETF (BITO), which entered the market in Oct. 2021.

Related: SEC reportedly won’t appeal court decision on Grayscale Bitcoin ETF

ProShares continued its release of bitcoin futures ETFs with the Short Bitcoin Strategy ETF (BITI) in June 2022. As of now, BITO has accumulated around $850 million in assets, while BITI has approximately $75 million.

In August, Cointelegraph reported that Ether futures ETFs may be approved in October, causing an 11% spike in ETH prices at the time.

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