Ohio Voters Back Abortion Rights; China Slides Into Deflation

Good morning.

I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.

We begin with major political news this morning, and our first stop is Ohio, where voters have rejected him measure seen as a test on abortion rights.

We get the details from Bloomberg zed Baxter.

The proposition, known as Issue one, would have made it harder to pass constitutional changes. It would have mandated a supermajority sixty percent, where it is now a simple majority. Now, this was put on the ballot in an effort to short circuit a proposition on the November ballot to change the Constitution to codify abortion rights. Abortion, of course, has been a state by state issue since the Supreme Court's Roe v. Wade ruling. The vote margin wide the initiative

All right, thank you, Ed.

We also have a new development in the latest criminal case against Donald Trump. It is a previous the undisclosed memo that prosecutors could use to bolster their argument of a conspiracy to overturn the election. Joan Donagher has details from our Bloomberg ninety nine to one newsroom in Washington.

The New York Times says it's obtained a copy of the memo dated December sixth, twenty twenty, that first came to light in last week's indictment from Special Counsel Jack Smith. It outlines a strategy from Trump lawyer Kenneth Cheesebro to have pro Trump electors meet in states that Joe Biden had won, and portray it as a routine measure to ensure the correct electors were counted if courts or legislatures

Okay, Joan, thank you.

One other note on the political front, former Arizona Republican nominee for governor Carry Lake maybe on the verge of running for office again. According to Axius, Lake will spend next month interviewing potential staff for a run for the Senate.

She is then expected to launch that effort in November.

Meantime, tensions between the US and China remain in focus. We're learning Washington as close to unveiling a plan to limit investment in China. Sources say the plan could apply only to Chinese companies that get at least half of their revenue from cutting edge sectors such as quantum computing and artificial intelligence. We're told the order will take about a year to go into effect. In China's economies and focus as well. This morning, amy as prices in the

I think deflation for sure. The question is how long, and.

I think it's up to the policy.

Mike, Well, we will they react with accordingly to the fifth co on mon Crida.

And Sheng at Morgan Stanley says it's the first time in almost three years that both consumer and producer prices in China, registered contractions in Europe.

This morning, we're seeing a rebound from yesterday's losses. Italian banks had fallen after word of new tax on profits. Now Italy's government is backtracking on part of that plan. It says there will be a cap to limit the impact for many lenders. That has banks outperforming in Italy, with shares climbing as high as five percent this morning.

Well back here in the US, Amy, there's plenty of corporate news to get you caught up on. Let's start with we Work. The shares are down seventeen percent in early trading. The company is raising doubt about its ability to stay in business. We Work is bleeding cash, and customers of its office rentals are canceling their memberships in droves.

And a couple of gaming stocks also on the move. Shares of Pen Entertainment are up eleven percent, rival draft kings down now more than four percent. That's after ESPN signed a partnership for sports betting with Penn. We get that story from Bloomberg's Charlie Pellett.

Penn Well have of a ten year exclusive right to use the ESPN bet name for sports betting in the US. Meanwhile, Penn says it is selling all of its Barstool Sports subsidiary to Dave Portnoy, who founded the sports and pop culture media company, in exchange for a non compete and other agreements. Penn also has the right to get half of the proceeds received by Portnoy in any subsequent sale of Barstool in New York. Charlie Pellett Bloomberg Daybreak.

Thank you, Charlie. And we should note Walt Disney, which owns ESPN, reports earnings today and those shares are currently up nearly one percent in early trading.

Wellyby.

It has been a summer of labor disputes and industries from Hollywood to Detroit, and now we're getting a glimpse of how contract demands in the auto industry could affect corporate earnings. Estimates from the big US car makers show a proposed contract with the United Autoworkers Union could wipe out their profits. In Bloomberg's Doug Prisner has the story.

We're told the calculations are based on the uaw's reques quest in current negotiations. They include a forty six percent wage increase, restoration of traditional pensions, cost of living increases, reduction in the work week to thirty two hours from forty, and an increase in retiree benefits. It's estimated these demands will add more than eighty billion dollars to labor cost for each of the big US automakers over the contract's four year term. Previously, UAW president Shawn Fain said record

All right, thank you, Nathan, time NOLVA. Look at some of the other stories making news around the world. For that, we are joined by Bloomberg's John Tucker.

Good morning, John and Amy.

You're here this morning, so we know it's not you. What somebody, somebody in Florida what a one point five eight billion dollar Mega Million's jackpot last night? And that ends a stretch of nearly four months when there was no winner. This is the third largest in US history. A chance of winning, by the way, was one and three hundred and two million. A grocery store at Neptune Beach sold that winning ticket. President Joe Biden says he

Mister Biden did not provide a timeline for the Vietnam visit, but other senior administration officials have already visited the country. The United States considers Vietnam a key partner in advancing a free and open Indo Pacific. The US normalized trade relations with Vietnam in two thousand and seven, and those links have deepened since former President Donald Trump imposed tariffs

Even before they pummeled the East Coast on Monday, thunderstorms have demonstrated a vast destructive power in the US. A report from insurance giant Swiss Ree says severe thunderstorms of the US accounted for nearly seventy percent of all insured natural catastrophic losses in the first half of this year. Police in Montgomery, Alabama, say at least three white people have been charged after a weekend five between a riverboat worker,

The captain of the Harriet remained away from the dock for nearly forty to forty five minutes as they attempted to contact the operators of the private boat via PA system. They will only responded to without seen gestures, curse words.

And taunting.

Investigators so far have not found any indication this attack was racially motivated, and Massachusetts Captinal more Heilly as they cleared a state of emergency citing an influx of migrants. There are more than twenty thousand people, many of whom are migrants, currently living in state shelters, including infants, young children, and pregnant women. That's up from around just thirty one

All right, John, thank you Tom now for our Bloomberg Sports update, and for that we bring in John stash Hour.

Aim of the Houston Astros won the World Series last year just trying to get back to the postseason this season. They've trailed Texas in the AL West most of the season, and the Rangers are currently three games ahead, but the Astros do have a slim lead for an AL wildcard spot, and last night in Baltimore against the Orioles, who have the best record in the America League, Houston trailed six to three in the nineteen eighty two.

Two again and Tucker hits it in a year pretty eat to right field that sends back with Tenna.

Appleway looking up stay light out.

Til Tucker gives the Astros a league with a grand slam.

Seven to six, Houston.

One hundred miles per hour from Bautista and more.

Than that from Tucker to right film.

Kbnb had the calls.

The Astros win seven to six Tampa Bay Rays with three runs of the eighth inning to beat Saint Louis four to two. The Rays have the lead for the first day L wildcard spot, but they have suffered a loss. Shane McClanahan, likely done for the year with an arm injuries, got an eleven to two records, started the season great, although he's actually winless in his last six starts. Red Sox gave up three home runs, lost in home to Kansas City nine to three. It was the SOPs debut

Phil's won the opener eight.

Four, Kyle schwarberhomer twice. NAT scored in the ninth inning, whin the nightcap five to four. Giants lost to the Angels seven to five. A's lost to Texas six to one. John Stash Edward Bloomberg's.

Fourth from coast to coast, from New York to San Francisco, Boston to Washington, DC, nationwide on SIRISXAM, the Bloomberg Business app, and Bloomberg dot Com.

This is Bloomberg Daybreak, Good Morning. I'm Nathan Hager. A special election in Ohio and a previously undisclosed memo could

Let's get more on both these stories. This morning.

We're joined by Greg Valier, chief US policy strategist at AGF Investments.

Greg. Good morning.

Normally one special election might not get a lot of attention, but we know that this one in Ohio is getting noticed at the White House this morning. What is the impact of Ohio rejecting this effort to raise the bar when it comes to amending that state's constitution.

Well, good morning, Nathan. This is a big deal for the Democrats. It makes it, I think even more likely that pro reproductive rights candidates will do well. You know, there were some other races earlier this year Kansas and elsewhere that showed there is strong support for abortion rights. This, I think just confirms that.

Does this then have bigger implications for the race for control of Congress next year as opposed to potentially President Biden's effort to get re elected in twenty twenty four.

I do think Democrats next year are well positioned on this issue. I mean, there are a lot of other issues, the economy being the number one, and of course all of the scandals coming out of what happened on January sixth, But I do think this is a big deal for the Democrats. I think that it shows that the Republicans on this issue are not in touch with a public.

It is interesting to see some of the reporting about this ballot measure that a lot of business interests to come out in favor of this idea of making it more difficult to amend the constitution in Ohio, including that state's Chamber of Commerce the National Federation of Independent Business.

Is there a potential business impact for this measure failing.

Maybe it could be easier to pass anti business regulations a bit, But the big story is abortion.

Absolutely.

That does seem to be what the implications are, given that a lot of the people who are voted against this amendment said that it wouldn't necessarily have even gotten on the ballot had not the Supreme Court overturned abortion rights last year. So what is the potential read through into the presidential race for this over whelming support for the idea of abortion rights being codified in state constitutions.

Well, I think that a lot of Republicans who are moderate on this issue are going to have to stay that way, and I think that for the Democrats this will be interpreted in the next few weeks as a significant victory in.

The time we have left.

Greg, I want to get your take as well on this memo reported in the New York Times that apparently hadn't been uncovered by the House January sixth Committee, but was part of Special Council Jack Smith's latest indictment pointing.

To what he calls the fake elector scheme.

How crucial is this memo as reported do you think to a Special Counsel Smith's case.

Well, we'll see in reading the story in the New York Times a few minutes ago, you can make a case for a conspiracy that one of these six alleged co conspirators had a big role in this. And I think if a conspiracy case looks more likely, you have to ask the question, could one or two of those six cop a plea? Could they seek a plea bargain? And I think that's no longer out of the question.

Who are you looking at specifically that my cop a plea here?

Juliani, I think he'd be high on the list. There are others though as well, who know where all the bodies were buried? This story in the Times this morning is going to have legs. I think it'll be a dominant factor for weeks to come as a conspiracy case become stronger.

Does it rise to the level of a smoking gun for you? Does it go that far?

Do you think?

Yeah?

I thought that, Nathan, that maybe you would be a smoking gun too early to say. I'm sure that Trump people are going to say that this is not relevant, that it doesn't make any strong case. But you look at this. The people who put this fake electric scheme together had a plan and they coordinated it, and to me, barraseat charge looks a lot more likely.

This is Bloomberg day Break Today, your morning brief on the stories making news from Wall Street to Washington and beyond.

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I'm Nathan Hager.

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