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The World
A post-Thanksgiving retreat in global stock indexes and energy prices intensified, reflecting jitters over the impact of a new variant and rising inflation. Nearly all the stocks in the S&P 500 fell as investors pulled away from riskier assets and sought haven in government bonds. The financial, communications, industrials, consumer staples and material sectors all declined more than 2%, and all 11 sectors in the index slid at least 1%. (Wall Street Journal)
Moderna CEO Stéphane Bancel predicted that existing vaccines will be much less effective at tackling Omicron than earlier strains and warned it would take months before pharmaceutical companies could manufacture new variant-specific jabs at scale. Bancel said the high number of Omicron mutations on the spike protein, which the virus uses to infect human cells, and the rapid spread of the variant in South Africa suggested that the current crop of vaccines may need to be modified next year. “There is no world, I think, where [the effectiveness] is the same level . . . we had with [the] Delta [variant],” Bancel told the FT. “I think it’s going to be a material drop. I just don’t know how much because we need to wait for the data. But all the scientists I’ve talked to . . . are like, ‘This is not going to be good’.” (Financial Times)
The Biden administration is preparing stricter testing requirements for all travelers entering the U.S., including returning Americans, to curb the spread of the potentially dangerous omicron variant. (Washington Post)
Poland reported its highest Covid deaths since April, while Greece will make vaccines mandatory for over-60s. (BBC News)
Congressional leaders continued to bandy over the terms of the next temporary shutdown patch, with just over three days left before federal funding expires. Since cash for the military and non-defense agencies is set to run out at midnight on Friday, Democrats need to swiftly finalize the next stopgap bill by midweek, or risk running out of time to pass it through both chambers before a shutdown strikes. But the two parties are still at odds over main conditions of the measure: how long the patch will last and which spending areas will be exceptions and receive a boost. (Politico)
Punchbowl talked with Senate Minority Leader Mitch McConnell: “We’re still talking about that,” McConnell told us, referring to his conversations with Schumer on the debt limit. We pressed him again -- were the conversations with Schumer recent? “Yeah, we’re still talking about it.” No saber rattling, no threats -- nothing. That’s a pretty significant departure from McConnell’s more hardline rhetoric earlier this year, and it signals a very serious effort to come to an agreement and avoid a debt-limit standoff. (Punchbowl News)
UK’s M16 Chief says the rise of China is the spy agency’s “single greatest priority,” with Beijing conducting large-scale espionage activities against the UK, Britain’s foreign spy chief has said. In his first public speech, Richard Moore, known as C, warned that the “tectonic plates are shifting” as Beijing’s power — and its willingness to assert it — grows. Moore said that a “miscalculation” by an over-confident China on an issue like Taiwan could pose a “serious challenge” to global peace. (The Times)
The U.S. and China are engaged in an arms race to develop the most lethal hypersonic weapons, the U.S. Air Force secretary said, as Beijing and Washington build and test more and more of the high-speed next-generation arms. "There is an arms race, not necessarily for increased numbers, but for increased quality," Air Force Secretary Frank Kendall said. (Reuters)
Honduras looks poised to elect a pro-China president, potentially robbing Taiwan of one of its few remaining allies in Latin America. Xiomara Castro, 62, of the Liberty and Refoundation party, has promised to switch diplomatic recognition from Taipei to Beijing once she is elected. Castro, wife of the former president Manuel Zelaya, held a lead of almost 20 points over the conservative Nasry Asfura as counting continued in the general election. (The Times)
A landmark report finds that one in three employees in Australia's government have suffered sexual harassment. The government conducted the report after thousands protested sexual violence in Australia and after government workers reported sexual harassment and assault. Prime Minister Scott Morrison says his government will likely support implementing the report's recommendations. (Fortune)
Economy
Fed Chairman Jerome Powell said the central bank was prepared to quicken the pullback of its easy-money policies, opening the door to raising interest rates in the first half of next year as it grapples with inflation and a potential new virus wave that could exacerbate supply-chain disruptions. His comments were part of a broader shift in how the Fed leader characterized the risks to an economy that faces a fresh coronavirus threat. His remarks suggested the Fed is pivoting from being more concerned about nurturing a faster labor-market recovery toward being more anxious about keeping prices from rising higher. (Wall Street Journal)
Cyber Monday online sales drop 1.4% from last year to $10.7 billion, falling for the first time ever. (CNBC)
Goldman Sachs CEO David Solomon warned New York City’s leaders they cannot take its position as a global business destination for granted and that higher taxes threaten to make it less appealing for companies and their employees: “New York is not going away” Solomon cautioned “it’s also not guaranteed for any urban center that you have a permanent place in the world.” Solomon’s comments come after the coronavirus pandemic prompted some New York residents to move to lower-tax states like Florida, amid broader tensions over how the city taxes high earners. “New York has to be aware that there are good choices, and it’s got to make sure it keeps itself super-attractive,” Solomon said. “At the end of the day, incentives matter, taxes matter, cost of living matters.” (Financial Times)
Goldman Sachs unveils Amazon-backed cloud service for Wall Street trading firms. The bank is opening up access to its trove of market data and software tools to hedge funds and asset managers in an offering designed with Amazon’s cloud division. The new service, called GS Financial Cloud for Data with Amazon Web Services, will help asset managers save time by allowing their developers to focus efforts on trades. (CNBC)
President Biden is considering Richard Cordray, the first CFPB director, to serve as the Fed’s top banking regulator, according to people familiar with the matter. If nominated and confirmed by the Senate, Cordray would become the government’s most influential overseer of the U.S. banking system. At the CFPB, Mr. Cordray brought significant changes to consumer finance, a corner of the financial industry that had previously escaped regulatory scrutiny. (Wall Street Journal)
The highest value of US mortgages eligible for federal government backing has been lifted to almost $1m, in a reflection of the surge in house prices during the pandemic. This is an 18 per cent increase in the so-called conforming loan limit set in 2021. In most of the US, the limit will rise to $647,200 from $548,250. The increases will raise questions about whether Fannie and Freddie, which were taken over by the federal government during the subprime mortgage crisis, are helping to stoke a furious rise in home prices. (Financial Times)
The head of Facebook's failed cryptocurrency is leaving the company. Facebook has spent the past few years trying and failing to convince regulators it should be allowed to make a digital currency. (Vice)
Sequoia Capital’s crypto frenzy intensifies with three new deals. (The Information)
The industries where Series B funding is growing fastest. (Crunchbase)
Technology
Twitter has expanded its private information policy to include media, banning users from sharing photos or videos of a private individual without their permission. The company notes that tweeting such images can violate someone's privacy and potentially lead to harm against them. (Engadget)
Twitter should consider changing its business model as its ad revenue remains weak, despite its locked-in userbase, indispensability, and impenetrable moat. (Stratechery)
Microsoft shareholders approved a proposal asking the board to publish a report on the effectiveness of its workplace sexual harassment policies in a rare vote of support for an activist initiative. The board of the software and hardware maker had recommended that shareholders vote down the proposal, but it received 77.97% of all votes, according to a regulatory filing. (CNBC)
The latest hot real-estate market isn’t on the scenic coasts or in balmy Sunbelt cities. It’s in the metaverse, where gamers are flocking and digital property sales are setting new records. A growing number of investment firms are acquiring digital land in worlds such as the Sandbox and Decentraland, where players simulate real-life pursuits, from shopping to attending a concert. They are betting that individuals and companies will spend money to use virtual homes and retail space and that the value of properties will increase as more people join the worlds. (Wall Street Journal)
Apple says it will notify users whose iPhones and devices have been compromised by state-sponsored hacking efforts. The tech giant published its plans to inform the hacking victims last week after Apple sued the Israeli company NSO Group, claiming it broke U.S. law by selling spyware to hack into iPhones. When Apple detects that a user has been targeted by state-sponsored hacking, it will send an iMessage and an email to the addresses on file, and a Threat Notification will be displayed when the user signs into Apple ID. (NBC News)
Podcast audiences soar: Over the last several years, podcast reach and audience shares have exploded. In the last two years, podcast daily reach among persons 18-34 is up +43% and daily reach among persons 25-54 is up an eye popping +51%. Further, Five years ago, 60% of the time spent with Spotify was to the ad-supported service. Now only 28% of time spent with Spotify is to the ad-supported version. Spotify’s ad-supported audience remains a small and shrinking aspect of the platform. (Westwood One)
Smart Links
U.S. removes Colombia’s Farc from list of terrorist organizations. (Financial Times)
Dr. Oz announces Senate bid to his millions of followers. (Politico)
Singapore overtakes Hong Kong as most expensive place to live in Asia. (South China Morning Post)
Crush of last-minute applications crashes UC, Cal State computers; deadlines are extended. (Los Angeles Times)
Obscure token spikes 900% due to name likeness with new COVID variant. (Coin Telegraph)
The 10 best books of 2021. (New York Times)