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The World
Russian general who may have known about Wagner mutiny goes missing: Vladimir Putin has moved to shake up Russia’s security services in the wake of the Wagner group’s failed insurrection, rewarding loyalists with promotions and freezing out figures sympathetic to the paramilitary organization’s leader Yevgeny Prigozhin. Sergei Surovikin, a senior Russian general known to have a good relationship with Prigozhin, has not been seen since recording a hostage-style video in the early hours of Saturday morning as the mutiny began, according to several people familiar with the matter. The unexplained absence of one of the most prominent commanders in Russia’s full-scale invasion of Ukraine comes as Putin seeks to restore order and re-establish control over the security services after the first coup attempt in Russia in three decades, said the people. (Financial Times, The Guardian)
Putin Moves to Seize Control of Wagner’s Global Empire: The Kremlin assured nations in Africa and the Middle East that it would manage Wagner forces, which have spread Russian power at little cost to Putin. Russia’s deputy foreign minister flew to Damascus to personally deliver a message to Syrian President Bashar al-Assad: Wagner Group forces would no longer operate there independently. Senior Russian foreign ministry officials phoned the president of the Central African Republic, whose personal bodyguards include Wagner mercenaries, offering assurances that Saturday’s crisis wouldn’t derail Russia’s expansion into Africa. Government jets from Russia’s Ministry of Emergency Situations shuttled from Syria to Mali, another of Wagner’s key foreign outposts. (Wall Street Journal)
Satellite imagery shows that Belarus is rapidly building what appear to be temporary structures at a deserted military base, revealing a possible location for Wagner fighters who were given the option of relocating to the country. By Tuesday, the images showed that a sports field covering approximately eight acres within the gated military facility had been transformed, packed with at least six rows of what appear to be temporary structures, like large tents. The satellite imagery also shows similar construction in open areas next to the sports field. (New York Times)
A man tore up and burned a Koran outside Stockholm's central mosque, an event that risks angering Turkey as Sweden bids to join NATO, after Swedish police granted permission for the protest to take place. Police later charged the man with agitation against an ethnic or national group. A series of demonstrations in Sweden against Islam and for Kurdish rights have offended Ankara, whose backing Sweden needs to gain entry to the North Atlantic Treaty Organization. (Reuters)
Portland Is Losing Its Residents: Long known for being clean, safe and hip, Oregon’s most populous city is now struggling with serious crime and homelessness issues. Meanwhile, despite the lifestyle problems, housing continues to cost more in Portland than in many other parts of the country. Portland lost nearly 3% of its population between 2020 and 2022, according to the U.S. Census. The drop of about 17,400 to 635,000 was the sixth largest decline among the 50 largest cities. Local officials who grappled with a 23% population surge between 2000 and 2020 now find themselves trying to keep residents from leaving. Mayor Ted Wheeler, a Democrat, has come under increasing pressure to address rising violent crime and sprawling homeless encampments. (Wall Street Journal)
The Great Lakes region was enveloped in smoke and haze from Canadian wildfires for a second day on Wednesday, prompting millions of Americans to stay indoors in the heart of summer to avoid the unhealthy air. In Chicago, the city’s famous skyline was shrouded in whitish, smoky clouds as President Biden, visiting for the day, delivered a speech downtown on his economic policies. Pools and summer camps in Madison, Wis., were closed down, forcing parents to scramble to find child care. Cleveland residents who ventured outside could taste the smoke in the air, the worst conditions that many had seen since the first wave from Canadian wildfires descended into the northern United States this month. (New York Times)
Chicago records second ‘very unhealthy’ air quality day, but predicting when smoke will clear is ‘uncharted territory’. (Chicago Tribune)
Majorities of Americans Prioritize Renewable Energy, Back Steps to Address Climate Change. (Pew Research Center)
74% of Americans say they support the country’s participation in international efforts to reduce the effects of climate change.
67% of U.S. adults prioritize the development of alternative energy sources such as wind, solar and hydrogen power over increasing the production of fossil fuel energy sources.
76% favor providing a tax credit to businesses that develop carbon capture technologies and 70% support taxing corporations based on their carbon emissions.
Economy
The largest US banks would lose $541bn in a hypothetical doomsday economic scenario but still have more than enough capital to absorb the losses, according to annual stress tests conducted by the Fed. The passing grades given by the Fed on Wednesday to banks including JPMorgan Chase and Goldman Sachs lent support to claims from Wall Street executives and regulators that systemically important banks can withstand heavy losses. The results will also help determine how much capital banks have to hold in the next 12 months. As long as banks match or exceed the requirements, they are free from Fed restrictions on how much capital they can put towards shareholder dividends and stock buybacks. (Financial Times)
The world’s top central bank chiefs signaled their readiness to increase interest rates further and keep them high, as they warned tight labour markets are still pushing up wages and prices. The heads of the US Federal Reserve, the European Central Bank and the Bank of England warned at a conference in Sintra, Portugal, that more action may be needed to bring inflation down towards targets of about 2 per cent despite some economists’ predictions that further rate rises could trigger a recession or financial crisis. (Financial Times)
Costco Makes It Harder to Share Membership Cards: The largest wholesale club in the U.S. by location, which requires customers to pay for an annual membership to shop in its stores, is now asking to see photo identification along with customers’ membership cards at its self-checkout registers. “Since expanding our self-service checkout, we’ve noticed that nonmember shoppers have been using membership cards that do not belong to them,” the company said in a statement. “We don’t feel it’s right that nonmembers receive the same benefits and pricing as our members.” (Wall Street Journal)
Asia pushes back on ‘excessive’ currency moves amid enduring dollar strength: Against the U.S. dollar year-to-date, the Japanese yen has slumped more than 9%, while the Malaysian ringgit fell close to 6% and the Chinese yuan slid about 5%. All three currencies tested seven-month lows against the dollar this month and are among the most battered in Asia this year. (CNBC)
DoorDash is offering drivers an hourly wage as one option to get paid, a step toward compensating them like employees rather than freelancers. (The Information)
Technology
The Great Wall dividing the U.S. from China is about to get higher. A Wall Street Journal report that the Biden administration is considering further tightening exports of artificial intelligence chips to China triggered a sell-off in chip stocks on Wednesday. Shares of Nvidia, the dominant provider of chips for generative AI, fell 1.8%. To be sure, that’s not much of a reaction for a stock that has risen 181% just this year, according to Koyfin. But the muted investor response makes sense: For Nvidia, losing China as a market is a long-term problem, not an immediate issue. Right now, demand for AI chips is so great that Nvidia will likely find other buyers easily if it can’t sell to China. As a Morgan Stanley analyst noted in a report Wednesday, there are plenty of customers in the U.S. “excited to take any product that might get repurposed from China.” But no one should underestimate the eventual cost of cutting off the nation. Listen to Nvidia Chief Financial Officer Colette Kress, who told an investment conference Wednesday that “over the long term” prohibiting Nvidia from selling AI chips to China “will result in a permanent loss of opportunities for the U.S. industry to compete and lead in one of the world’s largest markets.” (The Information)
The chief executives behind Microsoft’s planned $75bn acquisition of Activision made a last-ditch attempt to save the deal in a courtroom in the face of US government objections that could result in its annulment as early as next week. The acquisition of the gaming company would almost certainly collapse if the judge sided with the FTC. Evidence and questioning during the hearing have lifted the hopes of the deal’s supporters on Wall Street. Judge Jacqueline Scott Corley repeatedly prodded an expert witness called by the FTC over his analysis of the deal and at one point cut off the agency’s lawyer during questioning. She also invited a Microsoft executive to swear under oath that the company would grant Sony’s PlayStation a 10-year licence for Activision’s most popular game, Call of Duty — a central issue in the case. (Financial Times)
Sony highly confidential information about its PlayStation business has just been revealed by mistake. As part of the FTC v. Microsoft hearing, Sony supplied a document from PlayStation chief Jim Ryan that includes redacted details on the margins Sony shares with publishers, its Call of Duty revenues, and even the cost of developing some of its games. It looks like someone redacted the documents with a black Sharpie — but when you scan them in, it’s easy to see some of the redactions. Oops. The court has scrambled to remove the document, but the damage is done; reporters and Sony’s competition have already downloaded all the documents while they were in the public domain. Among other things, the document shows that Horizon Forbidden West apparently cost $212 million over five years with 300 employees, and The Last of Us Part II cost $220 million with around 200 employees. (The Verge)
Nvidia Warns of Lost Opportunities if U.S. Bans AI Chip Exports to China: Potential new restrictions on the sale of artificial intelligence semiconductors to China could come with a hefty long-term cost for the American chip industry—and another setback for U.S. relations with Beijing. The potential export controls would prevent Nvidia and other chip makers from shipping chips used to create powerful AI systems to China without first obtaining a license. The consequences could be severe, said Colette Kress, Nvidia’s chief financial officer. “Over the long term, restrictions prohibiting the sale of our [AI chips] to China will result in a permanent loss of opportunities for the U.S. industry to compete and lead in one of the world’s largest markets, and the impact on our future business and financial results is there,” she said during a webinar. (Wall Street Journal)
Micron Delivers Strong Forecast in Sign That Glut Is Easing: CEO Sanjay Mehrotra added that chipmaker continues to face challenges in China. (Bloomberg)
ChatGPT creator OpenAI Inc. is stealing “vast amounts” of personal information to train its artificial intelligence models in a heedless hunt for profits, a group of anonymous individuals claimed in a lawsuit seeking class action status. OpenAI has violated privacy laws by secretly scraping 300 billion words from the internet, tapping “books, articles, websites and posts — including personal information obtained without consent,” according to the sprawling, 157-page lawsuit. It doesn’t shy from sweeping language, accusing the company of risking “civilizational collapse.” (Bloomberg)
Big News Publishers Look to Team Up to Address Impact of AI: NYT, WSJ, IAC are among companies discussing forming a coalition. (Wall Street Journal)
Smart Links
Airline delays and cancellations are bad. Ahead of the holiday weekend, they’re getting worse. (Chicago Tribune)
‘It’s like Groundhog Day’: The cancer drug shortage isn’t new — and neither are the solutions. (STAT News)
Gates Foundation to fund trial of long-awaited new tuberculosis vaccine candidate. (STAT News)
National Geographic lays off its last remaining staff writers. (Washington Post)
Live News Is Coming to Max: Warner Bros. Discovery to Add CNN on Streaming Service. (Bloomberg)
Overstock Buys Bed Bath & Beyond Intellectual Property for $21.5 Million. (Wall Street Journal)