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The World
President Biden and other U.S. officials are urging Israel to delay the expected ground invasion of Gaza, warning that the Israel Defense Forces “are not sufficiently prepared to take on Hamas in the labyrinth of tunnels beneath the Palestinian territory.” Israel has mobilized 360,000 reserve soldiers in preparation for an invasion. (Times of London)
“As the Israeli Army gathers tanks at the Gaza border for a threatened invasion aimed at crushing Hamas, experts are warning that the country’s troops could face some of the fiercest street-to-street combat since World War II in Gaza City and other densely packed areas. Urban warfare studies and American officials offer dire comparisons” to the war in Iraq. (New York Times)
Iran-backed regional militias that have been relatively quiet in recent months are now launching drone and rocket attacks against bases that U.S. troops use in Iraq and Syria. In Yemen, the Iranian-backed Houthis “also fired five Iranian-provided cruise missiles and launched about 30 drones toward Israel in an attack that was larger than initially described by the Pentagon.” (Wall Street Journal)
China has replaced Defense Minister Gen. Li Shangfu, who has not been seen in public since August, without providing further information. Li “is the second senior Chinese official to disappear this year, following former Foreign Minister Qin Gang, who was removed from office in July with no explanation offered.” (Associated Press)
A group of lawmakers are calling on the Biden Administration to ban seafood processed in the Chinese provinces of Liaoning and Xinjiang, citing human rights abuses on China’s fishing fleet and the forced labor of ethnic Uyghurs as well as the exploitation of escapees from North Korea. (Associated Press)
“No previous September was close to as warm as last month — which was 0.93 degrees Celsius above normal.” (Washington Post)
Rep. Mike Johnson (R-La.) was elected the Republican speaker nominee in an internal vote by the GOP conference during a dramatic day in which Rep. Tom Emmer (R-Minn.) won a nomination vote but later dropped out. Johnson, 51, is the fourth Republican speaker pick since the ouster of Rep. Kevin McCarthy (R-Calif.). He is an attorney and former radio host who has served in the House since 2017 and is the vice chair of the House Republican conference. The full House is scheduled to reconvene at noon Wednesday. That is the earliest a speaker could be elected by the full chamber. (Washington Post)
The California Department of Motor Vehicles “has immediately suspended Cruise’s deployment and driverless testing permits, ending the GM self-driving car subsidiary’s robotaxi operations in San Francisco just months after receiving the last necessary permit to commercialize its operations.” The agency said, “When there is an unreasonable risk to public safety, the DMV can immediately suspend or revoke permits.” It said GM must meet a number of steps to reinstate the permits. (TechCrunch)
General Electric’s offshore wind operations are expected “to post annual losses of about $1 billion for this year and next as the industry struggles with rising costs.” Developers are facing supply chain challenges, rising costs for components, and higher interest rates, all of which are “likely to delay some projects and push out demand for turbines.” (Bloomberg)
Economy
Microsoft Corp. posted its strongest sales increase in six quarters, bolstered by recovering cloud-computing growth amid demand for new artificial intelligence products that are prompting corporate customers to shift back into spending mode. Revenue in the fiscal first quarter, which ended Sept. 30, rose 13% to $56.5 billion, topping analysts’ average projections. Profit was $2.99 a share, the software maker said. Azure cloud-services sales gained 29%, compared with 26% growth in the previous quarter. The shares jumped more than 5% in late trading. (Bloomberg)
Google reported its strongest business growth in more than a year but disappointed investors with relatively weak cloud-computing sales, delivering a mixed picture as it continues to wrestle with competitors developing artificial-intelligence tools. Google’s parent company Alphabet GOOG 1.61%increase; green up pointing triangle reported third-quarter revenue of $77 billion Tuesday, up 11% from the same period last year. The results marked the third consecutive quarter of accelerating growth for the search giant following an economic slowdown that briefly caused a rare drop in the company’s advertising sales. Sales growth in Google’s cloud division, which oversees the servers powering the company’s AI programs, slowed to 22% from the third quarter last year, coming in below Wall Street’s expectations. (Wall Street Journal)
The Corporate Retreat From Hong Kong Is Accelerating: The number of U.S. companies operating in the city has fallen for four years in a row, by Hong Kong’s count, hitting 1,258 in June 2022, the fewest since 2004. Last year, mainland Chinese companies with regional headquarters in Hong Kong outnumbered American ones for the first time in at least three decades. Coming to Hong Kong used to be “a fairly risk-free matter,” said Simon Cartledge, who runs a research and publishing company in the city and is the author of “A System Apart: Hong Kong’s Political Economy from 1997 until Now.” “Now, it’s not a risk-free place. There are question marks over everything.” (Wall Street Journal)
Card giant Visa sailed past estimates for fourth-quarter profit as consumers on a post-pandemic travel rebound shrugged off worries of a looming economic slowdown and cost-of-living crisis. Visa's CFO Chris Suh said U.S. inbound travel recovery accelerated in the quarter, while travel into Asia also continued to improve. "At a macro level, we are assuming no recession in our outlook," Suh said on a call with analysts. (Reuters)
General Motors “posted a strong third-quarter profit despite a hit from the United Auto Workers strike, which now is draining about $200 million a week from its bottom line.” GM also is abandoning a self-imposed target to build 400,000 electric vehicles by mid-2024, the latest sign that automakers are concerned about the viability of the market for battery-powered cars. (Wall Street Journal)
The UAW expanded its strike against GM “to a highly profitable full-size SUV plant in Texas — a swift response to healthy profits and record third-quarter revenue for the automaker. The Tuesday strike escalation includes roughly 5,000 workers at GM’s Arlington Assembly plant.” (CNBC)
Germany’s nominal gross domestic product is likely to overtake Japan’s this year, with Japan's nominal GDP falling 0.2% year-on-year while Germany’s expands 8.4%. In 2000, “Japan's economy was the second-largest in the world, at $4.96 trillion, which is larger than it is today. At the time, its economy was 2.5 times bigger than that of Germany and 4.1 times bigger than China's.” (Nikkei Asia)
Norway's $1.4 trillion sovereign wealth fund posted a loss of $33.8 billion in the third quarter. The world's largest sovereign wealth fund’s return on investment “was minus 2.1% for the July-September period, which was 0.17 percentage points stronger than the return on the fund's benchmark index.” (Reuters)
Technology
Microsoft CEO Satya Nadella admits giving up on Windows Phone and mobile was a mistake: Nadella is the third chief executive of the software giant to admit the company has made some serious mobile mistakes. Satya Nadella took over from former CEO Steve Ballmer in 2014 and, just over a year later, wrote off $7.6 billion related to Microsoft’s acquisition of the Nokia phone business. Nadella admitted that Microsoft’s “exit” from the mobile phone business could have been handled better. (The Verge)
Apple is gearing up for another product launch event on October 30th at 8PM ET / 5PM PT. The company has started sending out invites for everyone to tune in to the event, called “Scary Fast” on Apple[dot]com and YouTube Monday night, following rumors Apple is preparing to reveal updates for the Mac lineup. Apple’s page for the event shows an animation of the Apple logo transforming into the Finder icon, further suggesting that new Macs are on the way. Earlier this week, Bloomberg’s Mark Gurman reported that Apple might be planning a surprise “Mac-centered product launch” event. So far, rumors suggest that Apple could reveal a refreshed 24-inch iMac, along with a new MacBook Pro. As reported by Gurman, Apple’s inventory of the 14- and 16-inch MacBook Pros and the iMac have begun to dry up, which could indicate that we could soon see new models. (The Verge)
“A bipartisan group of 42 attorneys general is suing Meta, alleging that features on its Facebook and Instagram social media platforms are addictive and are aimed at kids and teens.” Attorneys general from 33 states filed a federal suit against Meta in the Northern District of California, while nine additional attorneys general are filing in their own states. The support “from so many state attorneys general of different political backgrounds indicates a significant legal challenge to Meta’s business.” (CNBC)
Apple is under scrutiny from European environmental and consumer groups “over its claims that its latest devices are ‘carbon neutral,’ a term that Brussels proposes to ban in corporate marketing because it is ‘misleading.’” At its annual project launch last month, Apple “called some Apple Watch models its ‘first-ever carbon neutral products,’ part of a drive to extend the classification across all its devices by the end of the decade.” (Ars Technica)
Clean-energy company Husk Power Systems will launch 500 solar mini-grids in Nigeria over the next five years as part of a push to bring electricity to millions in sub-Saharan Africa. Husk Power “said the investment cements its position as the leader in electrifying communities in rural Sub-Saharan Africa and South Asia with an AI-enabled platform of renewable energy services.” (TechCrunch)
Qualcomm Unveils New PC Chip in Challenge to Apple, Intel: PC processor industry is suddenly facing an influx of competition. (Bloomberg)
Smart Links
Global demand for coal, oil, and natural gas is set to peak by 2030, the International Energy Agency says. (DW)
Jamie Dimon rips central banks for being “100% dead wrong” on economic forecasts (CNBC)
Japan equity fees top China for the first time since 1999. (Financial Times)
ChatGPT is pretty good at writing believable phishing emails. (Axios)
Bitcoin rose more than six percent to its highest value since May 2022. (Reuters)
Atom Computing is the first to announce a 1,000+ qubit quantum computer (Ars Technica)
A tool called Nightshade lets artists add invisible changes to pixels in their work that disrupt any AI training set that scrapes it. (MIT Technology Review)