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The World
The global supply chain pressures blamed for disrupting the flow of goods and sparking high inflation may have finally peaked, according to a new gauge from the New York Federal Reserve. The new tool shows global supply pressures are about 4.5 standard deviations above normal — an extreme level not seen at any point since 1997. But the index’s latest findings suggest that supply-chain disruptions, while historically high, “have peaked and might start to moderate somewhat going forward,” wrote the New York Fed team. (CNBC)
Workers quit their jobs at a record rate in November while job openings stayed close to highest-ever levels, signs the U.S. labor market remained tight late last year. There were 10.6 million job openings at the end of November, a decrease from 11 million the prior month. The total number of quits reached 4.5 million after slightly falling in October from the previous month. The quits rate was 3%, up from 2.8% the prior month and returning to a record rate last seen in September. Separately, more recent analysis of private-sector job openings showed demand for workers increasing at the end of December. There were 12 million job openings in the U.S. at the end of that month. (Wall Street Journal)
The White House is embracing a manage-not-contain Omicron game plan while under immense pressure to keep some semblance of social normalcy. Meanwhile, Omicron makes up 95% of sequenced Covid cases in U.S. as infections hit pandemic record of more than 1 million new infections on Monday. (Politico, CNBC)
The fourth Pfizer vaccine shot causes a significant boost in antibodies within a week after taking it, according to interim data from Israel’s landmark study made public by Prime Minister Naftali Bennett. Bennett heard the partial results during a tour of Sheba Medical Center near Tel Aviv, telling reporters that a week after receiving the fourth dose, recipients had almost five times more COVID-19 antibodies in their blood. (Times of Israel)
UK PM Boris Johnson: We can ride this out without new Covid curbs, as daily infections hit a record high of 218,000. (The Times)
Macy’s cuts store hours as Covid cases spike and retailers face new staffing challenges. (CNBC)
BlackRock, AmEx extended their hybrid work plans. BlackRock is providing flexibility through Jan. 28 and allowing U.S. employees to work from wherever they are most comfortable. (Reuters)
A divided EU has demanded a role in next week’s negotiations with Russia over the Ukraine crisis and broader issues of European defense, after Vladimir Putin succeeded in sidelining the bloc in favor of talks with the US and Nato. EU officials expressed frustration at the way negotiations in Geneva and Brussels were arranged. (Financial Times)
North Korea fired a suspected ballistic missile off its east coast, underscoring leader Kim Jong Un's New Year vow to bolster the military to counter an unstable international situation. Japan's coast guard, which first reported the launch, said it could be a ballistic missile but did not provide further details. (Nikkei Asia Review)
Toyota has for the first time overtaken General Motors as the U.S.’s top-selling car company by annual sales, a change prompted largely by a global computer-chip shortage that dealt an uneven blow to the car business. The Japanese auto maker outsold GM by roughly 114,000 vehicles in 2021. Toyota’s total U.S. sales of 2.3 million rose about 10% compared with 2020. (Wall Street Journal)
Shares of Ford Motor and General Motors surged, lifted by investors' growing enthusiasm about their future electric pickup offerings. Ford's stock jumped more than 11% to its highest level since 2001 after the Detroit automaker said it will nearly double production capacity for its red-hot F-150 Lightning electric pickup to 150,000 vehicles. It said the model has already attracted nearly 200,000 reservations ahead of its arrival this spring. (Reuters)
Economy
Google parent Alphabet’s board approved new compensation packages for finance chief Ruth Porat, legal head Kent Walker, search boss Prabhakar Raghavan and Philipp Schindler, the company’s chief business officer. The executives’ base salaries will increase from $650,000 to $1 million. They each received stock awards valued at between $23 million and $35 million, split between performance-based equity and stock that vests over time. (CNBC)
Manhattan luxury home sales skyrocketed in 2021 to record breaking levels. More than 1,900 contracts for properties costing a total of about $16 billion were signed last year, the highest number and volume by a significant margin since Olshan Realty Inc. started tracking in 2006. While overseas buyers historically have helped drive the Manhattan luxury market, foreign travel to the U.S. was restricted most of the year. Instead, buyers from the New York metro area, confident in the city’s recovery, flush with cash from a surging stock market and able to borrow at ultra low interest rates, dominated. (Wall Street Journal)
NYC’s economic recovery is expected to lag until 2025, despite revenue growth. The city’s independent budget office expects a $3 billion budget gap. (Bloomberg)
Private equity backs record volume of tech deals: As of mid-December, private-equity firms had announced backing U.S. technology deals totaling $401.71 billion, including new purchases, asset sales and add-on deals. That accounted for 41% of a record $990.25 billion in overall private-equity deals through mid-December. The tech-deal value for 2021, which more than doubled from the 2020 level of $196.34 billion, was the highest since Dealogic began tracking the data in 1995. In 2020, tech transactions also represented 41% of overall private-equity deals, which totaled $474.06 billion. Investors say they expect more tech deals in 2022. Private-equity fund managers have long found software-as-a-service businesses particularly attractive, as these companies offer reliable recurring-revenue models and yield strong and consistent returns. (Wall Street Journal)
Interview: Female Founders Face Disadvantages Raising Capital in Male-Dominated Industries. Underrepresentation in enterprise software affects women as employees but also as founders, says Dana Kanze, an assistant professor of organizational behavior at London Business School: “We published research in Science Advances demonstrating that female founding CEOs are at a particular disadvantage when fundraising for ventures that cater to these male-dominated (as opposed to female-dominated) industries. Across our field and experimental studies, we discovered that female founding CEOs raise less funding at lower valuations for decreased equity in male- as opposed to female-dominated industries, while male founding CEOs achieve favorable funding-related outcomes regardless of the gender dominance of the industries they serve. We learned this is due to a misperception among investors that female (but not male) founding CEOs are a ‘lack of fit’ with their ventures when serving these ‘gender-incongruent’ industries.” (Wall Street Journal)
Technology
Bloomberg Media CEO Justin Smith stepped down effective immediately to found a new media company, and tapped New York Times media columnist Ben Smith to lead its future newsroom. “The news industry is facing a crisis in consumer trust and confidence due to the distorting influence of social media and rising levels of polarization and parochialism,” Justin Smith said. “My plan is to launch a premium news business that serves unbiased journalism to a global audience and provides a high-quality platform for the best journalists in the world.” Mr. Smith has recruited Ben Smith, who before his stint at the New York Times was editor in chief of BuzzFeed News, to be the company’s editor in chief. (Wall Street Journal)
“There are 200 million people who are college educated, who read in English, but who no one is really treating like an audience, but who talk to each other and talk to us,” Ben Smith said. “That’s who we see as our audience.” (New York Times)
News engagement fell off a cliff in 2021: Engagement with news content plummeted last year compared to 2020, and given the ongoing decline in interest in news about COVID-19 and politics, it doesn't look like 2022 will be much better. The Trump era and the onset of the COVID-19 pandemic created a one-of-a-kind media moment that will be hard for news companies to replicate. With fewer singular storylines capturing America's collective attention, news consumption was more scattered and diverted to sports. Primetime news viewership was down 36% across the three major cable networks, Fox News, CNN and MSNBC, with the steepest decline during that time frame happening at CNN. (Axios)
NPR's new pod push: NPR is adding a slew of new shows and subscriber-only bonus content to its new podcast platform NPR+. It also plans to launch an on-demand podcast bundle as a benefit of membership to local stations in the second half of the year. Subscription podcasting offers a new business model for NPR and its member stations. Offering podcast content to local members could grow station membership, which NPR relies on for revenue via affiliate fees. (Axios)
The NFT-marketplace OpenSea is in talks to raise at a $13 billion valuation in a deal led by Coatue. Kathryn Haun’s new crypto fund, which is currently operating under Haun’s initials “KRH,” is also participating in the funding round, sources tell me. Dan Rose at Coatue is spearheading the round and may take a board observer seat. OpenSea looks to be an iconic, controversial company that can’t stay out of the headlines for good or bad. (Eric Newcomer)
Deere & Co. helped mechanize agriculture in 1837 with the first commercially successful steel plow. The company unveiled a machine that could prove just as transformative: a fully autonomous tractor. John Deere’s new 8R tractor uses six pairs of stereo cameras and advanced artificial intelligence to perceive its environment and navigate. It can find its way to a field on its own when given a route and coordinates, then plow the soil or sow seeds without instructions, avoiding obstacles as it goes. A farmer can give the machine new orders using a smartphone app. “I think it's every bit as big as the transition from horse to tractor,” says Jahmy Hindman, Deere’s CTO. (Wired)
Smart Links
Dollar hits five-year high against Japanese yen. (Financial Times)
Tencent sells $3.01 bln stake in Singapore tech group Sea. (Reuters)
Electric cars hit 65% of Norway sales. (Reuters)
Fanatics acquires Topps trading cards for $500 million. (CNBC)
30 companies we think could IPO this year. (Crunchbase)
The biotech scorecard for 1Q22: 19 stock-moving events to watch. (STAT News)