The World
Federal Reserve Chairman Powell said the U.S. economic response alleviated the pandemic fallout, but suggested Congress would likely need to spend more money to shore up struggling parts of the economy. Meanwhile, the net worth of U.S. households increased by $7.6 trillion, or 6.8%, in 2Q20 to $119 trillion, beating the previous record set in 4Q19. The wealth rebound contrasts with the economy, as 2Q20 GDP registered its largest decline, underscoring how the downturn has hurt poorer Americans compared to many of their richer counterparts. Meanwhile, investors are realizing that Washington won't agree on new stimulus. (Wall Street Journal-1, Wall Street Journal-2, Finance 202)
Two international order visions will be on display when the leaders of the world’s two biggest economies address the UN General Assembly. A preview came on Monday when President Trump promised a “strong message” for China. Meanwhile, Chinese President Xi Jinping said China would “firmly uphold” the UN’s multilateral system, and, in a veiled swipe at the U.S., rejected efforts by any country to “be the hegemon, bully or boss of the world.” Meanwhile, the U.S. is using defense diplomacy to woo Bangladesh away from China, as Washington sees Dhaka as an “emerging” ally in its Indo-Pacific strategy. In Tibet, evidence grows that China is sharply expanding a mass labor program. (South China Morning Post, Nikkei Asian Review, Reuters)
A CDC vaccine advisory committee put off a vote on recommending who should get initial limited doses of any Covid-19 vaccine, while the White House tapped a meteorologist who has challenged connections between extreme weather and climate change to serve as the new chief scientist at the National Oceanic and Atmospheric Administration. In the UK, PM Boris Johnson announced six months of new restrictions and suggested the military could help enforce the measures. Italy has introduced border tests for French visitors. (Wall Street Journal, Washington Post, The Times, The Guardian)
Universities that reopened for face-to-face instruction might have caused tens of thousands of additional Covid-19 cases, as researchers estimated that an extra 3,200 cases a day occurred that likely wouldn’t have happened with classes online. In Texas, college towns are emerging as new hot spots, with cases surging among student populations and administrators scrambling to keep infections from reaching the broader population: In the counties where four-year college students make up at least 10% of the population, cases have grown 34% since Aug. 19 — compared to 23% in counties with a smaller proportion of students. In Madison, tensions are growing with the local government over rising cases, as the UW chancellor said off-campus parties and large gatherings are not under university jurisdiction. Bottom line: The fall opening of colleges has brought upheaval, pandemic weirdness and a fragile stability. (Wall Street Journal, Texas Tribune, Badger Herald, Washington Post)
A $1 billion fund Congress gave the Pentagon in March to build up the country’s supplies of medical equipment has instead been mostly funneled to defense contractors and used for making things such as jet engine parts, body armor and dress uniforms. (Washington Post)
A year after staging an election mired in controversy, Bolivia may be on the verge of doing it all over again. Following multiple postponements by the country’s caretaker regime, elections are slated for Oct. 18. Current polling shows a clear lead for Socialist presidential candidate Luis Arce over centrist former president Carlos Mesa and a slate of other candidates. (WorldView)
Companies’ New Back-to-Work Dilemma: Who Returns First? Companies reopening their workplaces are wrestling with a thorny problem: who should come back soonest. Employers are using algorithms and dashboards to find solutions as they navigate liability concerns and bruised egos. Meanwhile, Richard Baldwin, an economics professor at the Graduate Institute of International and Development Studies in Geneva and editor-in-chief of the widely read economic research site VoxEU, explains why this is just the beginning of a massive worldwide shift toward remote offices that span across continents. (Wall Street Journal, Vox)
Economy
Buyers are rushing to get more living space, but many potential sellers are keeping their homes off the market, resulting in the worst drought on record: In the week ended Sept. 12, total for-sale inventory was down 29.4% from a year earlier, the lowest level since 2017. Still, existing home sales jumped to 14-year high, as prices set another record. (Wall Street Journal, CNBC)
The new retirement living: More baby boomers are shunning housing mega-developments. Further, because of pandemic-related health and mental wellness issues at assisted living locations, seniors are having second thoughts about where to live. (CNBC, Kaiser Health News)
Airbnb’s rental supply fell this summer for the first time, by about 5% compared to last year. In NYC, the pandemic has put hotels on the brink — “a complete washout,” as several big hotels closed for good, and experts say more are coming. Still, some VCs are still enthusiastic about travel: Luxembourg-based Howzat Partners, is even raising a fresh fund of up to raise up to $120 million to invest in the sector. (The Information, New York Times, Skift)
The Robinhood effect: Last week's Snowflake and Unity Software IPOs had little to do with data warehousing or 3D game development, and lots to do with dizzying "pops" after pricing. People close to both IPOs say that the increases were driven almost exclusively by retail traders, which represented single-digit percentages of the floats. (Axios)
Technology
Doubts emerged about Oracle’s deal to take over TikTok as President Trump said he may renege on approval and the Chinese government signaled reluctance. This as it was revealed after months of maneuvering over the future of TikTok, it took a pair of 11th-hour phone calls with two of America’s most powerful executives to persuade Trump to agree to a tentative deal. (Bloomberg, Wall Street Journal)
Speaking of deals: Perhaps no day was more pivotal in transforming Google into a powerhouse across the digital advertising industry than April 13, 2007, when it secured a deal to buy DoubleClick for $3.1 billion. It also turned out to be a classic example of why many antitrust experts say lawmakers need to broadly rethink how mergers are regulated when the buyer is a tech company with strong and growing market power. (New York Times)
U.S. officials are exploring concepts for a new 5G wireless network that would let Silicon Valley giants and other businesses tap valuable Pentagon airwaves, setting up a potential clash over how to deploy the next-generation technology. Meanwhile, Microsoft pledged to get its gaming service on iPhones. (Wall Street Journal, Bloomberg)
One potential outcome of the Israel–Arab peace accords that hasn’t gotten much attention: The hope for a surge in scientific collaboration. In particular, space, water, food security and archaeology present opportunities for joint research as United Arab Emirates and Bahrain end boycott of Israel. (Nature)
Today is Tesla Battery Day: Tesla shares sank 4% in premarket trading, after CEO Elon Musk sought to manage expectations ahead of today’s “battery day” presentation and sent an email to all employees saying they would have to “rally hard” to hit “record deliveries” in 3Q20. Tesla is expected to announce details about a new type of battery cell it has developed — a million-mile-battery and information about cheaper cell production. Musk dampened hopes when he cautioned about hurdles to reaching mass production. The livestream (below) starts at 4:30 pm ET. (CNBC, Car & Driver, Wired, Tesla)
Smart Links
More MBA schools join test optional bandwagon. (Poets & Quants)
Most of the healthcare industry is in V-shaped recovery. (HealthcareDive)
NFL fines 3 head coaches $100K for failing to follow face mask policies. (Bleacher Report)
Edtech investors are panning for gold. (TechCrunch)
Nobel Foundation cancels live prize ceremony. (Reuters)
Award show viewership drops to record lows. (Axios)