January 5, 2021

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International

Where is Jack? Chinese billionaire and founder of Alibaba, Jack Ma, has not made a public appearance in more than two months. Ma even failed to appear in the final episode of his own talent show, Africa’s Business Heroes, which is similar to Shark Tank. Ma and his financial services firm, Ant Group, have been under scrutiny by Chinese regulators since Ma delivered a controversial speech in October. Ant’s IPO was put on hold, and authorities launched an anti-monopoly investigation. While Ma has been silent since October, both Ant and Alibaba have publicly pledged to work with regulators. We’re hoping that Ma has been spending his time on a yacht or private island, and unlike David Geffen has the good sense to keep it quite.

China gets Delisted or Maybe not: Following an executive order by President Trump, the NYSE had agreed to delist three Chinese telecom companies. While the ban was not set to take effect until next week, China vowed to retaliate. The EO was meant to prevent Americans from investing in companies that are connected to the Chinese military. (With Biden’s inauguration on the 20th, we may to have wait and see who blinks first.) On Monday night, the NYSE changed its mind, and will no longer delist. Your move, Biden.

Activist gets Sentenced for Reporting: A Chinese court sentenced a citizen journalist who reported on the initial COVID outbreak in Wuhan to four years in jail for "picking quarrels and provoking trouble" (Chinese legal code for publishing what the government doesn't want people to know). Zhang was detained in May and is currently in poor health after several months on a hunger strike to protest her arrest in China.

Activist gets Sentenced for Driving: Saudi women's rights activist Loujain al-Hathloul was sentenced to almost six years in prison for allegedly conspiring with foreigners to undermine the kingdom. Al-Hathloul was jailed in early 2018, just before the Saudi government removed the ban on women's right to drive. She will likely be released early next year, however, because the presiding judge suspended more than half of the sentence and applied the time she has already served in prison. 

Digital Service Taxes: France will resume collecting digital services tax from US technology companies (such as Facebook, Google and Amazon), and the US will impose retaliatory tariffs on $1.3B of French imports. Other European countries such as the UK and Italy are expected to begin collections in the coming months, and the US is investigating what tariffs might be imposed. The OECD continues to work on a solution for multinational digital tax revenue, although negotiations stalled over the summer (due to Treasury’s Mnuchin). Luckily, we have nowhere to go or an excuse to buy a luxury handbag.

Anti-vaxxers go Global: Spain is to set up a registry of people who refuse to be vaccinated against coronavirus and share it with other European Union nations, according to its health minister. While vaccination is not mandatory in Spain, the country expects to maintain a registry (which will not be available to the public or to potential employers). According to a recent poll, the number of Spanish citizens who have said they will not take the vaccine has fallen to 28% from 47% in November. The number of people who have died from COVID in Spain rose above the 50,000 mark on Monday. The country has registered more than 1.8M infections during the pandemic.

Coral Reef Insurance: For the first time, an insurance policy on a coral reef was triggered. Hurricane Delta hit the coast of Mexico, in the region of Quintana Roo, this October, and the government had insured the reef against wind and hurricane damage. The Nature Conservancy will receive $800k to repair the reef using trained volunteers. While the reef is not insured for warming waters, protecting the reef from storms will help to protect the coastline and its ecosystem. The Nature Conservancy said: “This is a win for nature, a win for coastal communities and will drive further interest in conservation finance and the need to protect marine ecosystems across the globe.”

From Inside the Banana Republic

Googlers form a Union: Google employees have often been vocal in the past about moves the company has made that is not to their liking: the forced resignation of the AI ethicist, the large leaving bonus for an executive accused of sexual harassment and contracts with the Department of Defense. In the past, however, Google has been quite active in attempting to stop its employees from unionizing (even firing four in November for unionizing). Until now. Yesterday, a group of 230 Googlers announced the Alphabet Workers Union (although Google has 123k full time employees and 130k contractors). “Members will pay 1 percent of total compensation, which includes salary and equity,” so we shall see how many full-time, white collar workers show up. The union might also throw some wrenches into the works for the anti-trust investigations, so while it might be small, it does have a large (social media) megaphone.

No takers of the Arctic: The Trump Administration attempted a last minute sale for drilling rights in the Alaskan Arctic. Bidding closed on December 31 for a million acres of 10-year leases in the Alaska National Wildlife Refuge. Luckily, oil companies don’t seem to be at all interested. The number of bidders and their identities won’t be public until Jan. 6, when bids are opened by Interior Department officials. But so far, it looks like the only serious contender is the state of Alaska itself. Two factors are keeping the companies at bay (don’t mistake this for concern over climate change or fragile ecosystems): the low price of oil and the fact that banks are unwilling to finance the drilling.

Farmers prosper in 2020: Socialism seems to be the all-ecompassing, political curse word of 2020, that is, unless you are a farmer. In 2020, a third of net income for farmers came directly from the government (farmers saw a 107% increase in direct payments from 2019). Excluding USDA loans and insurance indemnity payments made by the Federal Crop Insurance Corporation, farmers are expected to receive $46.5B from the government, the largest direct-to-farm payment ever. Overall, net farm income in the United States is expected to increase 43% from 2019 to $119.6B, the USDA estimated. Farmers will see the highest level of net farm income, a broad measure of profitability, since 2013, the agency said. Farmers continued to receive payments to compensate for tariffs and the pandemic despite rising commodity prices, raising the question of whether it is more profitable to own a farm or to actually farm it.

Who needs PPP? The stimulus bill that was signed into law last week re-opened the Paycheck Protection Protection for an additional $284B in small business loans. The glitch: the Small Business Administration has yet to open the application window or detail any of the rules related to this new tranche. Nothing like keeping small businesses on the edge of their seats while they watch their actual businesses implode. And who knows how the rules or the SBA processes (and processors) will change with the upcoming administration.

Denying Asylum: Scotland has made a pre-emptive announcement that traveling to Scotland to play golf is not “an essential purpose.” Apparently, Scotland’s Prestwick Airport, near Trump Turnberry, was told to expect a US military aircraft to arrive the day before Biden’s inauguration. Guess Scotland doesn’t want to be an escape for sore losers or super spreaders.

Granting Asylum: This week a British judge rejected the US’s request to extradite Julian Assange, the founder of Wikileaks. Assange faces 17 espionage charges in the US (unless he is pardoned by Trump), and the judge feared for Assange’s mental health. Luckily for Assange, Mexico has stepped in and offered him political asylum. Mexican President Andrés Manuel López Obrador made the offer and said “It is a triumph of justice. I celebrate that England acted in this way because Assange is a journalist and deserves a chance.” In this new upside down world, we guess if the US is standing “up” for democracy, Mexico can stand “up” for free speech.

Bitcoin is Back: In case you know any tech bros, you’ll recognize the constant refrain about their Teslas, their recent moves to Miami or Austin, and their love of Bitcoin. Bitcoin has been on the rise recently, hitting new historical highs (over $34k over the weekend and then dropping 17% yesterday), and JP Morgan has even set a $146k long-term forecast for the cryptocurrency. Bitcoin has been rising apparently due to more corporate interest (large investments from Square, acceptance of the asset by Fidelity, PayPal and Venmo, for instance). While Bitcoin is touted as an alternative to gold, it is the least environmentally friendly digital asset on the planet, and the power needed to mine the asset currently consumes more energy than the entire Kingdom of Jordan. Personally, we prefer regulated markets and cold hard cash. (Can we call the peak — even Anthony Scaramucci’s hedge fund is launching a bitcoin-focused fund.)

Rolling out the Vaccines: You may have heard the news that the vaccine roll out is going quite poorly, whether because of the lack of logistics, planning or even available health care workers to administer the shots. Our favorite depressing tidbit: some counties in Florida are using Eventbrite to schedule vaccinations. We are all for using user friendly platforms, but…

In Case You Missed It

2021 Started with a Twitter Rant: A father started off 2021 with a Twitter thread that he meant to be a teaching moment for his 9-year old daughter: he wouldn’t let her eat until she figured out how to open a can of beans with a can opener. It took the daughter over six hours to figure out the contraption without any help from her dad. He wanted to teach her daughter how to survive the apocalypse. Twitter wanted to jail him for child abuse.

2020 Ended with an Accent: Hilaria Baldwin, Alec Baldwin’s wife, was called out on Instagram for impersonating a person from Spain, and hilarity ensued. Hilaria, whose real name is Hillary Thomas, and who was born in Massachusetts, has named all of her children with elaborate Spanish names, and even claimed to forget how to say cucumber in English. While Amy Schumer apparently started the drama by making fun of Baldwin’s instagram feed (she tends to do yoga poses in high heels while pregnant), she also put a nice finish to it.

Dead or Alive: Tanya Roberts, an actress who was a Bond Girl and starred on That 70s Show, has had an interesting week. She was hospitalized on Christmas Eve, and then her partner notified the press that she had died. Celebrities flocked the airwaves with memories and condolences, and then the hospital called her partner (while he was in the middle of an Inside Edition interview) to notify him that she was still alive. However, after a day of miscommunication, Roberts did die (according to her publicist).

Phoebe and Harry Dance: If you are a fan of Harry Styles (who isn’t) and Fleabag, enjoy Harry’s new music video where he and Phoebe Waller-Bridge engage in an elaborate, Gucci-styled, dance routine. It is worth the ear worm.

— Lauren Eve Cantor

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