Know someone who would like this newsletter? Forward it to them.
The World
Chair Jerome Powell signaled the Fed will slow the pace of interest-rate increases next month, while stressing borrowing costs will need to keep rising and remain restrictive for some time to beat inflation. His comments likely cement expectations for the Fed to raise interest rates by 50 basis points when they meet Dec. 13-14, following four straight 75 basis-point moves. (Bloomberg)
Eurozone inflation falls more than expected to 10%: Inflation in the eurozone has fallen for the first time in 17 months, raising hopes that the biggest global price surge for a generation has peaked and easing pressure on central banks to continue increasing rates aggressively. (Financial Times)
Stocks rallied after Powell signaled a potential slowdown in interest-rate increases, powering the Dow more than 700 points higher and into a new bull market. The S&P 500 and Nasdaq jumped 3.1% and 4.4%, respectively, and all three indexes ended November with a second consecutive month of gains. (Wall Street Journal)
China launched a new Covid-19 vaccination drive, but there’s no mandate. A plan unveiled by health officials on Tuesday calls for a stronger push to get the older population inoculated by targeting places such as nursing homes and by making it easier for people to access vaccinations. Public health experts say while the plan does not go far enough, it would be difficult to introduce a vaccine mandate in China. “We’ve seen attempts by local governments to introduce a vaccine pass on public transport or to enter shopping malls, but they all backed down after strong resistance,” said Jin Dongyan, a virologist at the University of Hong Kong. “The central government seems to have neither the will nor the proper measures to introduce a vaccine pass.” (South China Morning Post)
China is a growing threat to national security, U.S. companies and American workers, U.S. Commerce Secretary Raimondo says. Raimondo said China is attempting to game the global system by stacking Chinese representatives on international technology standard-setting bodies to promote the country’s values and spread its influence. (CNBC)
Jiang Zemin, influential president of China, 1926-2022: The business-friendly leader was regarded as less dictatorial than his predecessors. During his 13-year tenure as general secretary of the Communist party of China, the highest authority in the world’s most populous nation, Jiang Zemin hardly fitted the image of a ruthless autocrat. A player of the Chinese flute and the traditional double stringed erhu, with large owlish glasses and trousers often hitched well above his navel, Jiang’s flair for regaling world leaders with impromptu song and dance performances became the stuff of diplomatic legend. At a state banquet for then US president George W Bush in Beijing’s Great Hall of the People, Jiang belted out a rendition of “O Sole Mio” before twirling across the dance floor with first lady Laura Bush. He could recite the Gettysburg address in English, enjoyed Romanian poetry and danced hula with Hawaiian schoolchildren. His jovial performances belied the toughness of a politician who was never supposed to be more than an interim leader of China. (Financial Times)
US lawmakers have voted to approve a bill to stave off a strike by railway workers that could potentially devastate the US economy. The bill, which passed 290 to 137 in the House of Representatives, binds companies and workers to a September agreement brokered by the Biden administration. It now heads to the Senate. The outcome of a separate bill to mandate paid sick leave remains uncertain. (BBC)
White House weighs future release of emergency heating, crude oil reserves as winter nears. Industry heating oil inventories have risen slightly in recent weeks, now sitting about 10% below the five-year average. But with the price of heating oil up 54% in the last year, any hiccup in supply could mean a headache for consumers. (CNBC)
U.S. gas prices plunge toward $3 a gallon as demand drops worldwide: The average price of gas is back to where it was before Russia invaded Ukraine. It is putting real money back in Americans’ wallets. (Washington Post)
Emergency phone calls may not be possible in parts of France if there are prolonged power cuts this winter, CEO of the country's No. 1 telecoms operator Orange said, as the prospect of energy rationing looms amid the war in Ukraine. (Reuters)
The UK announced a fresh round of sanctions against 22 Russians, including those the Foreign Office says were involved in enlisting criminals to fight in Ukraine. James Cleverly, the foreign secretary, said his department would target a new set of officials, including Denis Manturov, the deputy prime minister, who is responsible for troop equipment supplies. (The Guardian)
Stanford University has opened an investigation into its president, Marc Tessier-Lavigne, a renowned neuroscientist and former biotech executive, for research misconduct after experts alleged papers on which he was an author included altered images, the university confirmed. The university’s board will oversee the investigation. The revelations followed a report Tuesday in the Stanford Daily that the European Molecular Biology Organization (EMBO) Journal was reviewing a 2008 paper co-authored by Tessier-Lavigne. The Daily’s story outlines how experts including Elisabeth Bik, a scientific integrity expert who has investigated image manipulation in scientific papers widely, raised concerns about a total of four papers that Tessier-Lavigne co-authored between 2001 to 2008, including two on which he was the senior author. (STAT News, Stanford Daily)
New York and Singapore are jointly the world’s most expensive cities after inflation soared this year. The pair displaced last year’s number one Tel Aviv, which fell to third place this time round in the Worldwide Cost of Living index from London-based Economist Intelligence Unit (EIU). The survey revealed “the soaring cost of living in the world’s biggest cities as the war in Ukraine and continuing pandemic restrictions disrupt supply chains, particularly for energy and food”. (South China Morning Post)
Economy
China’s factory activity shrank in November as widespread coronavirus curbs disrupted manufacturers’ output, weighing on employment and economic growth in the fourth quarter. The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) rose slightly to 49.4 in November from 49.2 the previous month and beat expectations of a Reuters poll of 48.9. But the reading marks the fourth monthly contraction in a row, as the 50-point index mark separates growth from contraction on a monthly basis. The figure followed downbeat data in an official survey on Wednesday with manufacturing activity falling to a seven-month low in November. (South China Morning Post)
South Korea’s exports dropped the most in two and a half years in November, hit by slowing global demand and the semiconductor industry’s downturn. (Financial Times)
Apartment rents across the US dropped in November by the most in at least five years, a sign that a key cost tracked by the Federal Reserve could be easing up. A national index of rents fell by 1%, the third straight month-over-month decline and the steepest drop in data going back to 2017, Apartment List said in a blog post Tuesday. (Bloomberg)
Aging boomers are making it harder to tame inflation—and there are no quick solutions in sight. The number of older Americans over the age of 65 is not only growing and hitting their retirement age, they’re also not coming back to the workforce in the numbers seen prior to the COVID-19 pandemic. That has major implications—not only for issues like worker shortages and compensation and employee leverage, but also for current and future inflation levels, according to a recent BlackRock report. (Fortune)
Sam Bankman-Fried, the cryptocurrency billionaire whose empire collapsed spectacularly this month and spawned at least two federal investigations, sat for a wide-ranging interview at The New York Times’s DealBook Summit, saying he “screwed up.” Mr. Bankman-Fried seemed to frame the failure of his $32 billion cryptocurrency exchange, FTX, largely as a risk management problem that got out of hand. Asked whether he was concerned about criminal liability, Mr. Bankman-Fried had a hard time finding his footing in what he wanted to say — fidgeting, stopping and starting. “There’s a time and a place for me to think about myself and my own future,” he said. “I don’t think this is it.” Mr. Bankman-Fried said his lawyers did not support his decision to speak, but he decided to sit for the interview. “I have a duty to talk and to explain what happened,” he said. He added that he “didn’t know of times” that he had lied, but said he tried to make FTX seem exciting. “I was as truthful as I’m knowledgeable to be,” he said. (New York Times)
The crypto exchange Kraken is laying off 30% of its workforce, or about 1,100 people, as the fallout from this year’s digit-asset market meltdown worsens. (Bloomberg)
Technology
Elon Musk’s brain-machine interface company Neuralink aims to put its first implant in a human subject in the next six months, he said during an event Wednesday. Musk said the company has been “working hard to be ready for our first human,” and has submitted most of the required paperwork to the Food and Drug Administration to launch a study in humans. The company — which is designing a device to translate the brain’s signals into actions —also announced it will first focus specifically on two applications: restoring human vision, and helping people who can’t move their muscles to control devices like smartphones or even return the ability to move to people with severed spinal cords, Musk said. Though it’s starting with certain parts of the brain, Musk said Neuralink’s long term goal is to create a system that can translate impulses from the entire brain into actions. (STAT News)
Meta CEO Mark Zuckerberg said he believes that Apple’s power as a gatekeeper for the apps marketplace was problematic. Speaking at the DealBook Summit: “If you look at all the major competing platforms that have existed — iOS, Android, Windows — Apple stands out,” he said. “It is the only one where one company can control what apps get on the device. I don’t think it’s sustainable or good.” (New York Times)
Spotify's CEO Daniel Ek renewed his attack on Apple in a series of tweets alleging the iPhone maker "gives itself every advantage while at the same time stifling innovation and hurting consumers".
Elon Musk meets Tim Cook, says Apple never considered removing Twitter app. (CNBC)
Electric Vehicle Startups Face Cash Crunch. At least a dozen EV startups have gone public since 2020, mostly by merging with a special purpose acquisition company, with grand ambitions to reinvent the way people and freight moved around. Now, at least three—Canoo, Lordstown Motors and Faraday Future—are on life support. All three said in their most recent quarterly filings that there is “substantial doubt” about their ability to survive another year unless they raise additional capital. Canoo even said it probably wouldn’t be able to raise additional capital. (The Information)
Singapore and Hong Kong start-ups are sidestepping their home stock exchanges to merge with special purpose acquisition companies (Spacs) in the US, as fundraising vehicles in the Asian financial hubs have yielded little on their exit plans. Information from financial data provider Refinitiv shows that at least nine Singapore and Hong Kong companies this year have announced plans to go public with Spacs listed in the US, despite the cities offering a number of these shell companies since the first quarter — none of which has merged successfully with a target business. (Financial Times)
Smart Links
Delta is making its airport lounges more exclusive: Delta Air Lines is tightening Sky Club access to prevent long lines and over-capacity lounges. (Washington Post)
After the Great Resignation and quiet quitting, the era of ‘loud layoffs’ is here. (CNBC)
Silicon Valley law firm Cooley axes more than 100 employees. (Financial Times)
Bret Taylor steps down as co-CEO of Salesforce, leaving Marc Benioff alone at the helm. (CNBC)
AI experts are increasingly afraid of what they’re creating. (Vox)