Know someone who would like this newsletter? Forward it to them.
The World
The U.S. is increasing its military presence in the Philippines, adding American access to four more bases and asserting the Southeast Asian nation’s role as a key strategic partner for Washington in the event of a conflict with China over Taiwan. The agreement was announced as U.S. Defense Secretary Lloyd J. Austin III was in the Philippines. The deal would allow Washington to position military equipment and rotate its troops into a total of nine military bases controlled by the Philippines. The agreement comes amid growing fears in the region over a possible Chinese invasion of Taiwan, the island democracy China claims as its territory. (New York Times)
North Korea's Foreign Ministry said that drills by the U.S. and its allies have pushed the situation to an "extreme red-line" and threaten to turn the peninsula into a "huge war arsenal and a more critical war zone." The statement said Pyongyang was not interested in dialogue as long as Washington pursues hostile policies. (Reuters)
Moscow has massed hundreds of thousands of troops in Ukraine and is targeting dozens of places a day in a markedly stepped-up barrage of artillery attacks. Ukrainian forces are struggling to hold their ground on a 140-mile stretch in the east, awaiting tanks, armored vehicles and other weapons systems from the West. Ukrainian officials have been bracing for weeks for a new Russian offensive that could rival the opening of the war. Now, they are warning that the campaign is underway, with the Kremlin seeking to reshape the battlefield and seize the momentum. “I think it has started,” President Volodymyr Zelensky of Ukraine said. (New York Times)
Hong Kong’s leader is to launch a major US$255 million campaign designed to boost tourism, business and investment, which will include a giveaway of at least 500,000 free airline tickets to visitors and city residents. John Lee Ka-chiu will unveil the “Hello Hong Kong” bid to increase the number of visitors, bolster business and attract investors as the city fights its way back to normality from the pandemic. The campaign is expected to highlight more than 200 business, cultural and tourism events, including those that had been suspended for three years because of the health crisis, to underline to the world that the city is back in the game. (South China Morning Post)
President Joe Biden met with House Speaker Kevin McCarthy in search of a path to lifting the nation’s debt ceiling — and averting the potential for an economic catastrophe. They emerged from the hourlong session agreed on at least one thing: It could’ve gone worse. The White House said after the meeting that Biden told McCarthy he was eager to work with Republicans "in good faith." McCarthy said the two men could find common ground. But, as expected, there was no sign of an immediate breakthrough. (Politico, Reuters)
Attorneys general in 20 conservative-led states have warned CVS and Walgreens that they could face legal consequences if they sell abortion pills by mail in those states. A letter sent on Wednesday from Andrew Bailey, the Republican Missouri attorney general, to the nation’s largest pharmacy dispensing companies was cosigned by 19 other attorneys general, and warned that sale of abortion pills would violate federal law and abortion laws in many states. Missouri is among states that implemented strict abortion prohibitions last summer after the supreme court ruling overturning Roe v Wade. (The Guardian)
Three Indiana cities led the Wall Street Journal/Realtor[dot]com Emerging Housing Market Index in 4Q22, when affordable markets continued to dominate the rankings. Lafayette, Ind., a metro area of about 225,000 people, was the top-ranked emerging housing market in the quarter, followed by Fort Wayne, Ind.; Elkhart, Ind.; Topeka, Kan., and Johnson City, Tenn. The index identifies the top metro areas for home buyers seeking an appreciating housing market, a strong local economy and appealing lifestyle amenities. (Wall Street Journal)
Economy
Fed Slows Its Tightening With Quarter-Point Rate Rise: The Federal Reserve nudged up short-term interest rates by a quarter-percentage point and signaled it was on track to do so again at its meeting next month while officials consider whether and when to pause increases late this spring. Officials agreed to slow rate rises to gain more time to study the effects of their moves. “We’re talking about a couple of more rate hikes to get to that level we think is appropriately restrictive,” Fed Chair Jerome Powell said. Despite signs that wage and price growth might have peaked several months ago, “We’re going to be cautious about declaring victory and sending signals that we think that the game is won,” he said. (Wall Street Journal)
The More Powell Spoke, the More Stock and Bond Markets Rallied: Behind closed doors, Federal Reserve policy makers worry rallying markets are impeding their efforts to control inflation. But every time Jerome Powell goes out in public he gives them more room to run. When the Fed chairman took to the podium Wednesday afternoon, stock markets were hovering around their session lows. The central bank had just delivered an eighth straight rate hike and signaled more were to come, and some of the uber-bullishness on display in markets this year had faded a little. (Bloomberg)
Workers in the U.S. are spending more time in the office again, with occupancy rates surpassing 50% for the first time since the start of the Covid-19 pandemic. Average office use last week was 50.4% of early 2020 levels in 10 major U.S. cities, according to Kastle Systems, which tracks security swipes into buildings every business day. It is the first time office occupancy has topped 50%, according to Kastle, since March 2020, when Covid-19 forced most workplaces to temporarily shut down. All 10 of the major cities it tracks surpassed 40% for the first time, Kastle said. Workers are still staying home ahead of the weekend, however. Offices are emptiest on Friday, and they are the most crowded on Tuesdays. (Wall Street Journal)
One Company’s Trick to Getting 95,000 Hours Back? Canceling Meetings. When Reynolds American Inc. was preparing to update staff on its restructuring plans in January, it scrapped plans for a 90-minute town hall meeting. Instead, it posted a 10-minute video for employees to watch. Meetings are the new corporate hobgoblin. Executives at Shopify, Wayfair, and other firms say overstuffed calendars—partly a symptom of more remote work that crimped quick, serendipitous gatherings—waste thousands of hours and cut into productivity. How many hours? Since announcing a temporary purge of some kinds of meetings in early January, Shopify has deleted 12,000 events from staffers’ calendars, freeing up some 95,000 hours, the company said. (Wall Street Journal)
Tired of after-work emails and calls? In these countries, they’re outlawed: Kenya is the latest country to propose a “right to disconnect” law — joining France, Portugal and Italy — amid the pandemic-driven rise in hybrid and remote work. (Washington Post)
FedEx said it would cut its officer and director ranks by more than 10% as part of a broad cost-reduction effort that has reduced staffing at the delivery giant by 12,000 workers since June. (Reuters)
Technology
OpenAI launches ChatGPT Plus, a pilot plan with access in peak times, faster response times, and priority access to new features, in the US for $20 per month. (TechCrunch)
Microsoft plans to update Bing with OpenAI's GPT-4, a faster and richer version of ChatGPT, in the coming weeks; OpenAI plans to launch a ChatGPT app. (Semafor)
Microsoft announces the general availability of Teams Premium for $10 a month per user, with AI-generated notes powered by OpenAI's GPT-3.5 in the coming months. (Microsoft 365 Blog)
Meta shares soar on resilient revenue and $40bn in buybacks: Mark Zuckerberg has laid out plans to further wrestle Meta’s costs under control in what he deemed a “year of efficiency” for the social media company, as its shares jumped on better than expected sales, guidance for lower expenses and a new $40bn share buyback. Meta, which owns Facebook, Instagram and WhatsApp, reported 4Q22 revenues of $32.2bn, a 4% decline from the year before, but at the top end of its guidance and slightly above analysts’ estimates. The company also cut its 2023 expenses outlook by $5bn. (Financial Times)
Peloton shares jumped 24.9 per cent to $16.15 after the fitness company said it burnt through less cash in the last quarter and beat revenue forecasts. Stock in the exercise-bike maker, which became a household name during the pandemic, plunged 77.8 per cent in the previous year as people returned to gyms. For these new results, McCarthy can thank his subscription team, which is carrying the business—subscription revenue grew 22% year over year while sales of exercise bikes and other hardware shrank 52%. (Financial Times, The Information)
Smart Links
Percentage Of U.S. Adults With College Degree Or Postsecondary Credential Reaches New High. (Forbes)
Drug discount app GoodRx agrees to pay $1.5M to settle with FTC, which said company wrongfully gave intimate health info to Meta, Google, and others. (New York Times)
Netflix Tells Advertisers Sign-Ups to Ad Tier Doubled in January. (The Information)
EV maker Rivian to cut 6% of jobs amid price war. (Reuters)
Lebanon devalues official exchange rate by 90%. (Financial Times)