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The World
The White House has issued “an urgent plea to Capitol Hill for action on Ukraine assistance, warning in a new letter that the U.S. will run out of military aid for Kyiv by the end of the year.” Office of Management and Budget Director Shalanda Young wrote to congressional leadership, “We are out of money — and nearly out of time.” Young warned that “allowing U.S. aid to Ukraine to lapse ‘will kneecap Ukraine on the battlefield, not only putting at risk the gains Ukraine has made, but increasing the likelihood of Russian military victories.’” (Semafor)
Hungarian Prime Minister Viktor Orbán wants the European Union “to drop efforts to open membership talks with Ukraine from the agenda of its leaders’ summit in Brussels next week.” In a letter to European Council President Charles Michel, Orbán wrote, “There are expectations that on this occasion the European Council can and must decide on starting accession negotiations with Ukraine. In view of the current level of political and technical preparations, these expectations are unfounded.” (Bloomberg)
Kyiv Mayor Vitali Klitschko says Ukrainians are losing trust in President Volodymyr Zelensky over his handling of the war, and said Zelensky’s “rule is becoming increasingly autocratic.” Klitschko “has been at odds with Zelensky since last winter, when the president accused him of failing to adequately maintain Kyiv’s bomb shelters.” (Times of London)
Vladimir Putin, who has rarely left Russia since being indicted by the International Criminal Court, will travel to the United Arab Emirates and Saudi Arabia this week. (Bloomberg)
Nato has three years to prepare for Russian attack, warns Poland. (Times of London)
More than 20 countries including Canada, France, Japan, the UK, and the U.S. “plan to triple nuclear power by 2050 to achieve net-zero carbon emissions and limit climate change.” U.S. climate envoy John Kerry said in a statement, “Nuclear power that adheres to the highest standards of safety, sustainability, security, and non-proliferation has a key role to play in keeping 1.5 C within reach.” (CNBC)
Janet Yellen will travel to Mexico this week to meet with government and private sector leaders about the Treasury Department’s Counter-Fentanyl Strike Force. The new initiative “will bring together personnel and intelligence from throughout the Treasury Department — from its sanctions and intelligence arms to IRS Criminal Investigations — to more effectively collaborate on stopping the flow of drugs into the country.” (Associated Press)
“Senate negotiators are scrambling to revive bipartisan border talks” after Sen. Chris Murphy (D-CT), the lead Democratic negotiator, “said Monday that there’s ‘no path’ currently forward to a border deal.” However, Republican senators said they “expected a new exchange of offers, potentially as soon as Monday evening.” (Politico)
Unofficial ties between India and Taiwan have strengthened “as New Delhi’s relationship with Beijing has remained tense.” Bilateral trade “surged from just over US$1 billion in 2001 to US$7 billion in 2021,” and this summer, “a third Taipei Economic and Cultural Centre, a de facto consulate for Taiwan, opened in Mumbai.” (South China Morning Post)
“Venezuela fueled tensions with Guyana after a referendum approved a measure that backs Caracas claims over disputed territory. Some 95% of voters voted in favor of annexing the Essequibo region— currently part of Guyana, though long disputed between the two countries.” Venezuela says “the oil-rich region has always been part of the country and is only part of Guyana because of British colonialism. It remains unclear if Venezuela will actually follow through with the results of the referendum.” (Semafor)
Former U.S. Ambassador to Bolivia Manuel Rocha has been charged with acting as a secret foreign agent of Cuba. According to court documents, “in several meetings with an undercover FBI employee posing as a member of Cuban intelligence, Rocha repeatedly referred to the U.S. as ‘the enemy’” and praised Fidel Castro. Prior to serving as ambassador from 2000-2002, Rocha served as the Deputy Principal Officer of the U.S. Interests Section in Cuba in the 1990s. (CNN)
The Supreme Court appeared divided “over whether the Sackler family, which made its fortune selling a drug that fueled the nation's opioid epidemic, could be shielded from civil lawsuits by paying $6 billion to victims and drug treatment programs as part of a bankruptcy settlement with the company it once ran.” A decision in Harrington v. Purdue Pharma is expected next year. (USA Today)
Economy
Though the “economic downturn caused by the COVID-19 pandemic put the financial security of U.S. households at risk,” the typical U.S. household saw its wealth increase by 37% from 2019 to 2022, after inflation. But “poorer U.S. households were likely to be in debt both before and after the pandemic.” (Pew Research Center)
Investors hope for road map for China’s economy: After one of the toughest years for China’s economy and its investors, the country’s central bank governor had a sobering message: there may be more pain to come. Speaking to bankers in Hong Kong last week, Pan Gongsheng warned that the country’s economy was embarking on a “long and difficult journey” away from its traditional growth engines of property and infrastructure investment. Pan’s comments point to the principal challenges facing Chinese policymakers as they prepare for the central economic work conference expected this month. The annual policy-setting meeting will send a signal to investors about how much help the government is prepared to offer to the world’s second-largest economy. (Financial Times)
Rising Treasury Yields Pull Stocks Lower: Stocks and precious metals retreated, as higher bond yields weighed on shares of large technology companies. The Nasdaq led the declines, falling 0.8%. (Wall Street Journal)
Manufacturers “are struggling to chip away at inventories that accumulated during the pandemic, even with supply chains returning to normal, as economic weakness in markets like China saps demand.” Inventories “totaled $2.12 trillion at the end of September, up 28% from the pre-COVID level of December 2019.” (Nikkei Asia)
Roche will acquire anti-obesity drug developer Carmot Therapeutics for as much as $3.1 billion “as the Swiss pharmaceutical group joins the industry’s charge into the fast-growing market for weight loss treatments.” (Financial Times)
Technology
IBM has unveiled the first quantum computer with more than 1,000 qubits, but “says it will now shift gears and focus on making its machines more error-resistant rather than larger.” The new chip “has 1,121 superconducting qubits arranged in a honeycomb pattern.” It follows on “a 127-qubit chip in 2021 and a 433-qubit one last year.” (Nature)
Online misinformation expert Joan Donovan is seeking “‘an urgent and impartial investigation’ into alleged improper donor influence at Harvard’s Kennedy School, which she claims fired her after she and her research team started analyzing a trove of documents pointing to ‘significant public harm’ caused by Facebook.” Donovan “allegedly encountered a ‘wall of institutional resistance and eventual termination’ after her team began reviewing” the documents. (Boston Globe)
The Information Media Association, which represents more than 80 Spanish newspapers, is suing Meta, “accusing it of unfair competition in online advertising by allegedly ignoring European Union rules on data protection.” The association “accuses Meta of ‘systematic and massive non-compliance’ with EU data protection regulations” over five years. (Associated Press)
China’s Beijing Internet Court ruled last week that an AI-generated image “is covered by copyright law — a decision that breaks from the current U.S. approach to AI laws, and could benefit large Chinese tech companies in the long run, experts say.” Though the plaintiff was awarded just 500 yuan, or $70, one intellectual property lawyer said, “There’s a trillion-dollar AI industry behind that 500-yuan ruling.” (Semafor)
A new municipal law in Porto Alegre, Brazil, was entirely written by ChatGPT. The sponsor of the water meter legislation, which passed the city council unanimously, “said the chatbot processed a 250-character command and took some 15 seconds to employ its algorithmic magic and spit out a policy — a process that would normally take him about three days.” (Washington Post)
Spotify will eliminate about 1,500 jobs, or about 17% of its workforce, in its third round of layoffs this year. In a note to employees, CEO Daniel Ek “cited the slow economic growth and rising capital costs among reasons for the job cuts, saying the firm took advantage of lower-cost capital in 2020 and 2021 to invest significantly in the business.” (TechCrunch)
Smart Links
Fed, with rates at a peak, now looks at a hold and an eventual pivot lower. (Reuters)
Bitcoin price surges above $42,000 to 20-month high. (Financial Times)
Intel wins US appeal to overturn $2.18 billion VLSI patent verdict. (Reuters)
5.5G: China is rolling out the next big thing in communications technology. (South China Morning Post)
The Inside Story of Microsoft’s Partnership with OpenAI. (New Yorker)
Amy Edmondson wins FT and Schroders Business Book of the Year: Management title ‘Right Kind of Wrong’ praised as ‘highly readable and relevant’. (Financial Times)