SPACE

Boeing Is Playing Astronaut When It Should Be Playing Mechanic

Boeing ($BA) airplanes might have issues, but their spacecraft has even more. Since 2010, Boeing has been working on Starliner — a crewed capsule that shuttles astronauts to the International Space Station. In 2014, NASA gave Boeing billions to accelerate its development. But instead, it ran into issues — with launch delays due to failed missions, structural issues, and quality problems.

Liftoff, at long last: It’s six years and five months overdue, but Boeing’s Starliner finally blasted off on its first crewed mission — a big step toward receiving NASA certification for crewed flights. Starliner will be an alternative to SpaceX’s Crew Dragon capsule, which has been the only certified option to fly since 2020 — but it wasn’t an easy or cheap journey.

• In 2014, NASA paid Boeing $4.2B to build Starliner — only for SpaceX to beat them to certification with $2.6B for Dragon.

• While Dragon has had 10 successful flights since its certification, Boeing’s first crewed launch faced problems like helium leaks and thruster issues.

Worth the F(l)ight?

Boeing’s space business has faced similar problems to its commercial aircraft business — although, with much fewer customers and flights. After certification, NASA has committed to at least six Starliner flights. However, some, like Bloomberg Opinion columnist Thomas Black, think Boeing should spin off its space business to focus on its aircraft business — before it’s outdone by rivals.

• The Federal Aviation Administration has slowed Boeing’s recovery by limiting MAX production and delaying certifications for 737 MAX variants.

• And later this month, Boeing’s CEO will testify in front of a panel investigating safety issues — just months before he’s expected to resign due to the company’s failures.

It keeps getting worse: After facing a $4B hit last quarter, Boeing expects to burn through billions more this quarter, and won’t be cash flow positive this year. The CEO of Emirates, one of the biggest Boeing buyers, predicts a “five-year hiatus” until the aircraft manufacturer emerges from its crisis. With over 44% of Boeing’s revenue coming from its imperiled aircraft business in FY2024, it’s fair to say that Boeing should focus more on fixing than flying.

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LARGECAP RECAP

🚗 Elon Musk Could “Leave” Tesla If He Doesn’t Receive $56B Pay Package

This week, Tesla ($TSLA) shareholders will decide if CEO Elon Musk should get a $56B compensation package, making him the highest-paid CEO in history. It’s the second time investors are weighing in on his compensation, with the original plan deemed “deeply flawed” by a Delaware judge. Now, with Tesla much bigger, the stakes are higher.

• Proxy giants Institutional Shareholder Services and Glass Lewis recommended shareholders vote against Musk’s package, calling it excessive.

• Tesla’s chair warns that if Musk’s pay package isn’t approved, he could “step back” or leave to focus on other ventures like SpaceX or xAI.

What’s likely? Earlier this year, Musk told shareholders he wouldn’t build AI products at Tesla unless he owned a quarter of the company — more than double what he owns now. Seems like a hard sell, considering his existing proposal is under fire. Luckily for Musk, his OG package is probably getting the green light, especially with retail investors, who own 44% of the company and have been overwhelmingly supportive of authorizing the package. Ultimately, we’ll see what Thursday brings.

This $5,000 system shows you where to invest right now: Chaikin’s Power Gauge flashed “buy” on Tesla before it climbed 335%, Moderna before it climbed 300%, and Riot Blockchain before it climbed 10,090%. It also found NVIDIA at the start of 2023… before its massive bull run. Is the system flashing bullish or bearish on your favorite stocks? See it for free here →*

Markets & Economy

US job growth surprises: In May, nonfarm jobs surged by 272K despite the slight uptick to a 4% unemployment rate and declining job openings. The Fed is likely to maintain current interest rates amidst conflicting signals. [Read]

Waystar’s ($WAY) IPO boost: The healthcare financial software provider says its initial public offering has taken in $968M, boosting market confidence after Novelis yanked its share issue days before. [Read]

Buy momentum, says WSJ columnist: While it may be tempting to buy low, there’s usually a reason a stock is cheap. Instead, investors are advised to look for strong “relative strength” ratings, although not necessarily at their peak. [Read]

Business & Wealth

Trump talks revenge: The former President reiterated his desire for retaliation during a convo with Dr. Phil, suggesting that “sometimes revenge can be justified.” Despite Dr. Phil’s caution about the addictive nature of seeking revenge, Trump appeared unconvinced. [Read]

Major players receive semiconductor funding: Over half of the Biden administration’s CHIPS funding to build or expand semiconductor factories has gone to eight key companies, including Intel ($INTC) at $8.5B, TSMC ($TSM) at $6.6B, and Samsung at $6.4B, totaling over $35B in investment. [Read]

NBA pay shoots up and up: Dallas Mavericks’ Luka Doncic could breach the $100M per season mark within the next decade, funded by TV networks and streaming services vying for viewership. [Read]

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DIGIT OF THE DAY

Market Conditions Help Mint 600K New Millionaires in 2023 To Beat 2021 Record

The future of fortune suggests that all you need to join the millionaire club is artificial intelligence (AI). Last year, the US welcomed 600K new millionaires, bringing the total to 7.5M and surpassing the rest of the world. This growth is attributed to a strong rebound in the stock market at the end of 2023, increased government spending, and the rise of AI.

• America’s millionaires now hold a whopping $26.1T — marking a 7% jump from the previous year — and also account for 30% of global millionaire wealth.

• Despite rising interest rates, many are turning to more aggressive growth assets — with two out of three high-net-worth individuals planning to invest more in private equity in 2024.

Rich and richer: As the ultra-wealthy get wealthier, competition intensifies among firms managing these fortunes — pushing them to focus on personalized services such as succession planning, tax advice, and concierge services to cater to the unique needs of their high-net-worth clients. The number of Americans worth $30M or more rose 7.5% in 2023, reaching 100K individuals, and their combined wealth soared to $7.4T. However, Elias Ghanem from Capgemini Research Institute warns that inflation, a potential recession, geopolitical issues, and elections could slow down the pace of wealth creation (CNBC).