The World
Economists are warning of a U.S. “wasteland” without a stimulus deal, as 50 Democratic and Republican members of Congress will unveil new $1.5 trillion bipartisan relief legislation. Meanwhile, as the Fed’s two-day meeting begins, market participants expect trillions more in stimulus from the central bank and Congress, while forecasting no rate hikes until 2023. Separately, the OECD estimates that U.S. school closures could amount to a loss of almost $14.2 trillion to the U.S. economy over the next 80 years.(Financial Times, Reuters, CNBC-1, CNBC-2, The 74 Million, OECD)
The World Trade Organization ruled the 2018 U.S. tariffs against China were inconsistent with global trading rules, as the U.S. announced new blocks some exports from China's Xinjiang region over alleged human rights abuses. Separately, Washington told Americans to “reconsider travel” to Hong Kong in the wake of the national security. Meanwhile, the Asian Development Bank said Developing Asia’s economy will shrink for the first time since the early 1960s. (Reuters, BBC News, South China Morning Post, Bloomberg)
America’s reputation has declined further among many key allies and partners. In several countries, the favorable view of the U.S. is as low as it has been at any point since the Center began polling on this topic nearly two decades ago. Across the 13 nations surveyed, a median of just 15% say the U.S. has done a good job of dealing with the outbreak. Most say the W.H.O. and European Union have done a good job, and in nearly all nations people give their own country positive marks for dealing with the crisis (U.S. and UK are notable exceptions). Relatively few think China has handled the pandemic well, although it receives considerably better reviews than the U.S. response. (Pew Research Center)
Health officials globally are facing death threats amid the pandemic, including the U.S., Germany, Sweden, and Australia. Elsewhere, China will have access to locally developed vaccines as early as November, as its chief biosafety expert says she was inoculated herself in April and ‘has felt quite good’ since. Meanwhile, fewer than 1 in 10 Americans have a “great deal” of trust in the FDA or pharmaceutical companies to look out for their interests. A separate poll shows state governors are rated best on government leadership on health, followed by the CDC and President Trump. (Washington Post, The Australian, South China Morning Post, Axios/Ipsos poll, Gallup)
The UK’s failing to reach an EU trade deal would be more costly than dealing with the coronavirus, Goldman Sachs economists warned, saying a no-deal fallout was likely to be “two to three times larger” than that of “the worst pandemic witnessed in post-war history.” Meanwhile, Britain’s unemployment rate climbed. (CNBC, New York Times)
Aleksei Navalny, the Russian opposition leader who is recovering in Berlin after being poisoned, posted a photograph from the hospital stating that he was breathing on his own. “Hello, it’s Navalny,” he said in an Instagram post with a picture of himself surrounded by his wife and other relatives. “I can still do almost nothing, but yesterday I could breathe the entire day by myself.” Meanwhile, his spokesperson said Navalny will return to Russia. (New York Times, BBC News)
How the pandemic set global development back “25 years in just 25 weeks.” The Gates Foundation’s 2020 Goalkeepers Report states: In past editions we have celebrated decades of historic progress in fighting poverty and disease. This progress has now stopped. We track 18 indicators included in the United Nations’ Sustainable Development Goals. In recent years, the world has improved on every single one. This year, on the vast majority, we’ve regressed. This essay has two goals: First, we analyze the damage the pandemic has done and is still doing. Second, we argue for a collaborative response. There is no such thing as a national solution to a global crisis. (The Telegraph, Gates Foundation)
Economy
We recently posted an outstanding, important podcast conversation with Joe Coughlin, CEO & Founder of Corporate Risk Solutions, on “The Science & Art of Managing Business Risk,” with focus on the growing legal tension between businesses and insurance companies and whether business-interruption policies cover Covid-induced business losses. Now that legal fight is going global, as a UK court considered whether business interruption policies are clearly worded, while Australian insurers believe a now repealed century-old law allows them to exclude the pandemic. In France, a court found in favor of a restaurant owner who sued his insurer over the rejection of a claim for cover during government-ordered lockdowns. (Working Capital Review, Wall Street Journal, The Times)
Productivity Slipped: The troubling pattern emerged as most of JPMorgan Chase’s employees worked from home to stem the Covid-19 spread. Work output was particularly affected on Mondays and Fridays. Meanwhile, the majority of the Washington region’s workers are unlikely to return to the office before next summer, as cities examine the cost of a lasting exodus from offices. (Washington Post, Greater Washington Partnership, Financial Times)
Federal regulators are preparing to reprimand Citigroup for failing to improve its risk-management systems. The expected rebuke accelerated planning for Chief Executive Michael Corbat’s retirement. Meanwhile, Citigroup is resuming job cuts in bid to reduce costs. (Wall Street Journal, Financial Times)
Hedge fund billionaire Steve Cohen reached an agreement to buy the New York Mets. The sale values the Mets at $2.42 billion, making it the most ever paid for an MLB franchise, topping the $2.15 billion paid for the Dodgers and surrounding real estate in 2012. (Axios, Sportico)
German stocks have outpaced European rivals since the coronavirus-driven market selloff bottomed out in March, reflecting the advantages of strong balance sheets and exports to China. (Wall Street Journal)
Technology
What to expect from Apple’s ‘Time Flies’ event: Apple Watch Series 6, a redesigned iPad Air, and more — but no new iPhone. Watch live below (1pm ET/10am PT/6pm BST). (The Verge)
The TikTok-Oracle deal will get White House approval today, CNBC says, as TikTok proposed adding a new U.S. headquarters and 20,000 jobs to win over President Trump. Meanwhile The Verge argues that Oracle’s TikTok deal accomplishes nothing: After months of insistence that TikTok sever its US operations from Chinese ownership, we’re settling for a vague partnership between Oracle and the US TikTok operation. It’s still unclear exactly what Oracle’s “trusted tech partner” status entails, but it’s definitively not a sale… Microsoft’s version of the deal would have severed American TikTok from Europe and Asia entirely, but Oracle’s version of the deal leaves it mostly intact. US TikTok will stay the same as Korean TikTok and Nigerian TikTok; it’s just getting an extra babysitter. That makes it less of a sale and more of a glorified hosting deal. (CNBC, Washington Post, The Verge)
Tencent picked Singapore as its beachhead for Asia, joining rivals Alibaba and ByteDance in the race to build up their presence closer to home after setbacks in the U.S. and India. Meanwhile, Alibaba is in talks to invest hundreds of millions of dollars in Zhaopin, one of China’s biggest recruitment sites — potentially combining its vast customer base with Zhaopin’s data on companies and jobs. (Bloomberg, The Information)
IBM thinks it can deliver a quantum computer that would marry enormous computing power with a tough-to-achieve low rate of errors by 2023. Companies, most notably IBM and Google, are investing heavily in a race to commercialize quantum computers that ultimately may be able to solve some problems much faster than a classical computer. (Axios)
Smart Links
More businesses give employees paid time off to work Election Day polls. (Axios)
Why nostalgic logos are booming. (Marker)
Goldman names new co-heads of EMEA investment banking division. (Reuters)
Fast, efficient method to produce red blood cells developed, cutting cell culture time by half. (Singapore-MIT Alliance for Research and Technology)
MLB will ban alcohol (and champagne sprays) for playoff celebrations. (Sports Illustrated)
Without events, Halloween, Christmas items sell out as consumers go all in on decorating. (Los Angeles Times)