Trump Fires Attorney General Pam Bondi

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Alex Ossola (0:33)

President Trump fires Attorney General Pam Bondi, the second cabinet secretary, let go in recent weeks. Plus, Blue Owl, the poster child for private credit, is the latest fund to have investors try to pull billions.

Matt Wirz (0:46)

I've been covering this industry really since it started, and I have never seen anything even close to this. It's blood in the streets right now for these funds.

Alex Ossola (0:55)

And watch out, Bloomberg. OpenAI is getting into the news business. It's Thursday, April 2nd. I'm Alex Ossola for The Wall Street Journal. This is the PM Edition of What's News, the top headlines and business stories that move the world today.

Pam Bondi is out as Attorney General. It's an end to her yearlong tenure atop the Justice Department, marked by what President Trump views as her mismanagement of the Jeffrey Epstein scandal. I touched base with WSJ reporter Ryan Barber, who joined me from a courtyard at the Justice Department.

Ryan Barber (1:31)

Pam Bondi's ouster capped a very much rocky year spent as Attorney General under a cloud of frustration from the White House and the broader Trump administration. In replacing Bondi, at least in the near term, the Justice Department leadership pivots to the current Deputy Attorney General Todd Blanch, who like Bondi is a former lawyer for Trump. And in many ways, he really owns a lot of what Bondi's tenure meant. So it does invite the question of, is Trump ultimately going to look for someone who he believes will be more aggressive, will be more responsive to his view of the Justice Department as really being an arm of his White House?

Alex Ossola (2:11)

In a statement, Bondi said she would work over the next month to transition the Attorney General's office to Blanche. In other news from the Trump administration, the US will impose tariffs of up to 100% unbranded pharmaceuticals. A senior administration official said the levy will apply to patented imported pharmaceuticals from companies that haven't committed to invest in the US and haven't entered into most favored nation agreements to match their US prices to the lowest they can charge in other developed countries. But, the full 100% tariff may apply to only a few drug makers or none at all. Countries or companies that strike deals with the Trump administration or commit to build manufacturing facilities in the US can receive lower levies.

Blue Owl is the latest private credit firm to tighten its redemption rules. Investors asked to withdraw 22% of their money from its $36 billion fund and 41% from a separate technology-focused fund. WSJ credit reporter Matt Wirz.

Matt Wirz (3:09)

I've been covering this industry really since it started around 15, 20 years ago. And I have never seen anything even close to this. Blackstone and Aries and Apollo and all these other fund managers reported these very high numbers of shareholders withdrawing and the fear just built and built. Blue Owl, they're kind of the poster child for private credit. And they were the last of these funds to report the withdrawals. And I don't think this means anything terrible today for the shareholders that are left in the fund. And the reason is that this fund and most of the other funds that are like it have plenty of cash and can borrow plenty more to pay out shareholders at 5%.

The problem is what happens if this happens for four quarters or six quarters or eight quarters? If that happens, we might see a pain point where these funds have to start selling the loans that they hold, their investments, to pay out shareholders and that could lead to losses.

Alex Ossola (4:11)

The industry's troubles are unfolding just as private credit is making its biggest pitch yet to work its way into everyday retirement accounts.

Matt Wirz (4:18)

This is a real wake up call for that initiative. Honestly, it's kind of embarrassing. They're trying to go to Washington and say, hey, this is a great product and you should put it in 401Ks and at the same time, it's very clear that the investors in the funds that they've already created really have very little understanding of what it is they're buying and what the risks are.

Alex Ossola (4:47)

In Iran, the bombing continues. A senior US official said the US military has struck the B1 bridge, which links Tehran to neighboring Qaraj. The attack was part of a larger US effort to sever military resupply routes. Meanwhile, Israel faced four rounds of Iranian missile strikes overnight, while Saudi Arabia intercepted a ballistic missile and five drones. And explosions were heard across the United Arab Emirates. Asian leaders issued grave public assessments of the war's economic ripple effects. Some nations, including the Philippines, are striking deals with Iran to allow their vessels through the Strait of Hormuz. Tehran's ability to control the Strait is Iran's biggest piece of leverage against the US., its Gulf neighbors and the global economy. For more, I'm joined now by the Journal's Chief Foreign Affairs Correspondent Yaroslav Trofimov. Yaroslav, what does Iran want the new status quo to be in the Strait of Hormuz?