Know someone who would like this newsletter? Forward it to them.
The World
Wounded Johnson narrowly survives confidence vote: Boris Johnson survived a bruising confidence vote, but his victory by 211 to 148 in a ballot of Tory MPs left him badly damaged and exposed the scale of the division and animosity in his party. The result means that 41% of Johnson’s MPs wanted to oust the prime minister. The revolt was more serious than Downing Street had expected and leaves his authority badly damaged. Johnson told MPs his victory would end months of speculation about his future and he would now be able to focus fully on policy delivery, holding out the prospect of future tax cuts. (Financial Times, The Times)
The White House on Monday excluded Cuba, Venezuela and Nicaragua from the U.S.-hosted Summit of the Americas this week, prompting Mexico's president to make good on a threat to skip the event because all countries in the Western Hemisphere were not invited. (Reuters)
Summit of the Americas opens in L.A. as the U.S. grapples with deteriorating relations and influence: As the U.S. prepares to host the Summit of the Americas in Los Angeles, the first time the event has been hosted in this country since 1994, many of those involved with the inaugural effort are wondering what happened to the spirit of collaboration, and why division and acrimony have come to overshadow joint effort. And an even more existential question remains: Has this type of summit outlived its usefulness? The most glaring evidence of regression has come in the form of decisions or threats from several leaders to boycott the event. That problem has thrown the White House’s preparations for the summit into a chaotic scramble, creating bad optics for a president who has prided himself on his familiarity with Latin America. (Los Angeles Times)
6 things to watch during the Summit of the Americas. (Politico)
Americans aren’t keen on reconciliation with Cuba: Twice as many Americans support the current sanctions on Cuba as oppose them, 42% to 21%, according to fresh survey data from Morning Consult. Support is strongest among Hispanic adults and Republicans, but maintaining the sanctions gets more backing than removing them across all ethnic, partisan and age groups. (Morning Consult)
The Russian foreign minister has been forced to cancel a visit to Serbia after neighboring countries closed their airspace to his plane, prompting threats from Moscow. Sergey Lavrov’s two-day visit to Belgrade for talks with President Vucic, who has good relations with the Kremlin, was due to start today. A flight ban imposed by Bulgaria, a member of the European Union, as well as by Montenegro and North Macedonia meant that there was no way for him to make the trip. (The Times)
Federal judge authorizes US to seize two of Roman Abramovich’s private jets. US justice department prosecutors say both jets flew to Russia in March, violating export restrictions. (The Guardian)
China is secretly building a naval facility in Cambodia for the exclusive use of its military, with both countries denying that is the case and taking extraordinary measures to conceal the operation, Western officials said. The establishment of a Chinese naval base in Cambodia — only its second such overseas outpost and its first in the strategically significant Indo-Pacific region — is part of Beijing’s strategy to build a network of military facilities around the world in support of its aspirations to become a true global power, the officials said. (Washington Post)
Thousands of British travelers, including teachers, midwives and doctors, are stranded abroad after a wave of flight cancellations at the end of the Platinum Jubilee bank holiday. The disruption forced many holidaymakers to miss their return to work as they frantically searched for alternative routes home. (The Times)
President Biden is likely to decide later this summer whether to partially forgive student-loan debt for millions of borrowers, according to administration officials and others familiar with the matter, after the president said more than a month ago that he would weigh in on the issue in the next couple of weeks. The officials said Mr. Biden is likely to announce his plans in July or August, closer to when the pandemic-related pause in federal student loan payments is scheduled to lapse, as the president and his senior advisers continue to weigh the political and economic fallout of any such move. The Biden administration earlier this year extended the pause, which has been in effect since March 2020, until Sept. 1. (Wall Street Journal)
President Biden is facing public pressure from America's leading unions on an issue that has divided his top advisers: extending former President Trump's China tariffs on approximately $300 billion worth of Chinese goods. The Biden administration is engaged in an intense internal debate on whether to waive some of the so-called Section 301 tariffs to help ease inflation — the top issue roiling Biden's presidency. By filing an official comment with the Office of the U.S. Trade Representative Monday evening, union leaders are going public with what they've been saying in private: they expect Biden to keep all of Trump's tariffs in place. "Our government must act in the national interest to strengthen our economy for the future," writes Thomas Conway, the president of the United Steel Workers, in a comment filed on behalf of the Labor Advisory Committee for Trade Negotiations and Trade Policy. (Axios)
Americans are deeply pessimistic about the U.S. economy and view the nation as sharply divided over its most important values, according to a new Wall Street Journal-NORC Poll. The findings are from a Journal survey conducted with NORC at the University of Chicago, a nonpartisan research organization that measures social attitudes. The survey found Americans in a sour mood and registering some of the highest levels of economic dissatisfaction in years. The pessimism extended beyond the current economy to include doubts about the nation’s political system, its role as a global leader and its ability to help most people achieve the American dream. (Wall Street Journal)
Some 83% of respondents described the state of the economy as poor or not so good. More than one-third, or 35%, said they aren’t satisfied at all with their financial situation. That was the highest level of dissatisfaction since NORC began asking the question every few years starting in 1972 as part of the General Social Survey.
Just over one quarter of respondents, 27%, said they have a good chance of improving their standard of living—a 20-point drop from last year—while just under half of respondents, 46%, said they don’t.
Economy
The SEC is exploring an overhaul of US stock market rules to strengthen competition and ensure individual investors are fairly treated after the explosion in retail trading during the coronavirus pandemic. The regulator has been reviewing equity market structure since last year, when chair Gary Gensler said the meme-stock frenzy — when traders organized online to drive up the shares of a handful of companies — highlighted “inefficiencies” in the market. (Financial Times)
Yen falls to 132 against dollar, hitting 20-year low: Analysts see few factors able to halt the yen's slide. (Nikkei Asia Review)
A growing number of investors are rebelling against high pay at the top of the biggest US companies and some are starting to target individual board directors to try to force action. In the year to May 15, only 61 per cent of S&P 500 companies that held annual meetings received more than 90 per cent support for executive pay, down from 71 per cent last year and 76 per cent in 2020, according to pay consultancy Farient Advisors. At the same time, the number of companies receiving just 50 to 90 per cent shareholder support for pay has risen to 36 per cent from 25 per cent last year. (Financial Times)
How crypto giant Binance became a hub for hackers, fraudsters and drug traffickers: For five years, the world’s largest cryptocurrency exchange Binance served as a conduit for the laundering of at least $2.35 billion in illicit funds, a Reuters investigation has found. (Reuters)
Last month, almost 400,000 women joined the labor force, according to the May U.S. jobs report and the National Women's Law Center. The boost increased women's labor force participation to 58.3%, only "one percentage point below their pre-pandemic labor force participation." Women of color joined the labor force in the highest numbers. But unemployment also rose as more women said they were looking for work. (CNBC)
As Sheryl Sandberg leaves Meta, Silicon Valley loses one of its most powerful women. Even as Ms. Sandberg lauded the progress of women at Meta, the broader reality for female leaders at the top of the tech industry has been far more disappointing. And with her exit this fall, Silicon Valley is losing one of its most visible and outspoken female executives, leaving few — some would say zero — similar peers in her wake. A report shows only 4.8% of SV's top 15 firms were led by women in 2020. (New York Times)
Technology
Big Tech pulls out all the stops to halt ‘self-preferencing’ antitrust bill: Amazon and Alphabet are spearheading what is shaping up to be the most intense political campaign by corporate America in recent history as part of a last-ditch attempt to stop Congress from passing laws to curb their market power. The companies are targeting a “self-preferencing” bill which would prevent large online platforms from using their dominance in one field to give other products an unfair advantage — for example, Alphabet using its Google search engine to promote its travel or shopping products. If the bill goes through, it is likely to lend momentum to a wave of legislation aimed at strengthening America’s competition rules, in what could be the biggest update of the country’s antitrust rules in a generation. (Financial Times)
Apple WWDC 2022: the 16 biggest announcements: 1) Apple introduces iOS 16 with customizable lock screen, updated notifications, and more; 2) iOS 16’s live activities let you control apps from the lockscreen; 3) Apple is making texts editable and unsendable in messages; 4) Apple Pay is getting a pay later feature in iOS 16; 5) Apple announces safety check for abuse survivors; 6) Carplay may soon bring Apple’s widgets to your car’s instrument cluster; 7) WatchOS9 comes with a slew of new health-tracking features; 8) Apple’s Fitness app is coming to iPhone users; 9) Apple’s Home app gets a new look; 10) Apple has announced next-gen M2 chip; 11) the redesigned MacBook Air is the first to feature the new M2 chip; 12) Apple’s new 13-inch MacBook Pro also comes with an M2; 13) MacOS Ventura adds stage manager multitasking tool; 14) Apple Passkeys replaces passwords with your iPhone; 15) Continuity camera lets your iPhone function as a webcam; 16) iPadOS 16 brings new features focused on multitasking and collaboration. (The Verge)
Apple to offer ‘buy now, pay later’ credit in challenge to Klarna and Affirm. (Financial Times)
Hands-on with the new, more colorful, M2-powered MacBook Air: The MacBook Air has been an iconic laptop design since Steve Jobs slid it out of a manila envelope in 2008. This year’s model, which Apple just announced at WWDC and is also the first Apple laptop to come with an M2 chip, abandons the famous wedge shape but also improves almost everything else about the Air. The first thing you notice? Colors! The new design is 11mm thick and weighs 2.7 pounds, and while it is now a more traditional slab-shaped design, it comes in a very handsome dark blue called “midnight” and a light gold called “starlight” in addition to the familiar silver and space gray. The display is now larger at 13.6 inches and gets closer to the edge of the lid because the 1080p camera has been hidden in a notch. (The Verge)
Elon Musk accused Twitter of “resisting and thwarting” his right to information about fake accounts on the platform, calling it in a letter to the company a “clear material breach” of the terms of their merger agreement. “Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement,” the letter, signed by Skadden Arps attorney Mike Ringler, says. Twitter shares were down 5% on Monday morning. Musk waived due diligence when he moved to buy the company, seemingly to hasten the acceptance of his bid. (CNBC)
Analysis: Musk’s spambot argument—which he laid out today in a letter to Twitter via his lawyer—is so absurd as to not warrant more than a cursory discussion. After all, Musk was complaining about the prevalence of spam bots on Twitter in January, before he bought a single share in the company. Having decided to buy the company without doing due diligence, he can’t seriously be using the issue as a real reason to “not consummate” the deal as he intimated today. If Musk does back out of it, as seems likely, the real issue will be the one that was apparent on day one: the challenges he faces in financing the purchase. Those difficulties have only escalated as Tesla’s stock price has dropped. All else is simply spam. (The Information)
‘Top Gun: Maverick’ is Cruise’s biggest domestic box office success. It’s only Week 2. The patriotic action film earned $86 million this weekend for a North American cumulative of $291.6 million. (Los Angeles Times)
Religion of Sports, the sports media production company co-founded by Tom Brady, Michael Strahan and filmmaker and entrepreneur Gotham Chopra, has raised $50 million in a new series B funding round led by Shamrock Capital. Production companies founded by star athletes are booming in the streaming era, as entertainment networks scramble to find content that will break through. (Axios)
Smart Links
Cravath to open second US office. (Financial Times)
9th Circuit Court blocks permits for fracking off the California coast. (Los Angeles Times)
This startup wants to pack more energy into electric vehicle batteries. (MIT Technology Review)
Welcome to the Great Reinfection: A repeat encounter with Covid used to be a rarity; expect reinfections to be the new normal. (Wired)
Australia runs diplomatic Pacific island blitz in China's wake. (Nikkei Asia Review)