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The World
President Volodymyr Zelensky of Ukraine is expected to make a daring trip today to meet with President Biden at the White House and address Congress in person. Zelensky is expected to join Biden at the White House for an announcement on Wednesday — likely to include a pledge by the Biden administration of a new round of military assistance — before heading to Capitol Hill for a prime time speech. (New York Times)
In a surprise move, Japan’s central bank loosened its "yield curve control" that capped long-term interest rates on 10-year Japanese government bonds at 0.25%. That cap is now 0.5%. Japanese rates will remain low, but the action signaled that, after two decades of trying mightily to coax inflation higher, even Japan sees a changing balance of risks. The move sent the yen soaring by about 4% against the U.S. dollar in early trading, a massive jump for one of the world's most important currency pairs. It also made for bumpy trading in global bonds and stocks. (Axios)
U.K. Companies Tested by Fallout From Ukraine War. The U.K. is suffering more than other big countries in Europe, economists say. Inflation is running in the double digits, higher than all of its Group of Seven industrialized peers with the exception of Italy; gross domestic product shrank 0.2% in the third quarter year-over-year, setting the U.K. on course for a likely recession. Other big economies like Germany and France are increasingly looking like they may avoid one. The British economy is widely forecast to shrink in 2023, faring worse than every G-20 economy except Russia, the OECD says. (Wall Street Journal)
Chinese authorities will impose a strict review of data processing, cross-border data transfers, and M&A activities involving foreign capital that could affect national security, as Beijing moves to safeguard what it considers as sensitive information. That approach forms part of new policy guidelines released on Monday by the Central Committee of the Chinese Communist Party and the State Council, the country’s cabinet. The guidelines aim to boost the country’s data market, while addressing issues such as data rights and trading profit distribution. (South China Morning Post)
Millions of people who enrolled in Medicaid during the COVID-19 pandemic could start to lose their coverage on April 1 if Congress passes the $1.7 trillion spending package leaders unveiled Tuesday. The legislation will sunset a requirement of the COVID-19 public health emergency that prohibited states from booting people off Medicaid. The Biden administration has been under mounting pressure to declare the public health emergency over, with 25 Republican governors asking the president to end it in a letter on Monday, which cited growing concerns about bloated Medicaid enrollment. (US News & World Report)
German business confidence improved more than expected in December as managers in Europe’s biggest economy took a brighter view of both their current situation and the outlook for the next six months, a closely watched survey showed. The Ifo institute said its monthly confidence index rose to 88.6 points from 86.4 in November. Economists had expected an increase to 87.5. “German business is entering the holiday season with a sense of hope,” Ifo said in a statement. The December improvement in overall sentiment was the third in a row, but it marked the first time that businesses have been more positive about their current situation after six months of increasing pessimism. (Associated Press)
Economy
Wells Fargo said it's agreed to pay $3.7 billion in a settlement with the CFPB over accusations that it charged consumers illegal fees tied to auto loans and mortgages. The deal casts a fresh spotlight on a turbulent period for Wells Fargo as the bank tries to wipe away the sins of its past and demonstrate that it's changed its ways. (Axios)
Delta Air Lines is expected to begin rolling out free wireless internet for its passengers as soon as early 2023, people familiar with the matter said. The Atlanta-based carrier is initially expected to offer free Wi-Fi on a significant portion of its airplanes before turning on the service on more of its fleet through next year, some of these people said. The move is likely to intensify competition over in-flight offerings as airlines rebound from the pandemic. (Wall Street Journal)
Where to find holiday deflation. Costs for a range of goods are on the downswing, thanks in part to retailers marking down prices to clear out inventory (after miscalculating exactly how long the extreme consumer demand would stick around). Prices for sports equipment are getting cheaper: down 0.9% in November. They are still 5.3% higher than a year ago, according to the Consumer Price Index. Toy prices fell 1.4% last month, and are a mere 0.6% higher than a year ago. The cost of women's coats and jackets fell over 1.3% last month, and are down 2% over the last year. (Axios)
U.S. poised to become net exporter of crude oil in 2023. The United States has become a global crude oil exporting power over the last few years, but exports have not exceeded its imports since World War II. That could change next year. Sales of U.S. crude to other nations are now a record 3.4 million barrels per day (bpd), with exports of about 3 million bpd of refined products like gasoline and diesel fuel. The United States is also the leading liquefied natural gas (LNG) exporter, where growth is expected to soar in coming years. (Reuters)
An exodus of more than half a million people from the British workforce since the Covid pandemic is putting the economy at risk of weaker growth and persistently higher inflation, a Lords report has warned. The House of Lords economic affairs committee said the sharp rise in economic inactivity – when working-age adults are neither in employment nor looking for a job – since the onset of the health emergency was posing “serious challenges” to the economy. Against a backdrop of severe staff shortages across the country, it said earlier retirement among 50- to 64-year-olds was the biggest contributor to a rise in economic inactivity of 565,000 since the start of the pandemic. (The Guardian)
Technology
Facebook parent Meta Platforms CEO Mark Zuckerberg took the witness stand in a case in which the FTC is seeking to prevent the social-media company from acquiring a virtual-reality startup. The FTC is seeking an injunction blocking Meta’s planned acquisition of Within Unlimited Inc., the company behind the popular virtual-reality fitness game “Supernatural.” The legal move poses a direct challenge to Meta’s strategic focus on the metaverse, a term used to describe a platform where numerous online users work and play in virtual worlds. (Wall Street Journal)
The next breakthrough to take the AI world by storm might be 3D model generators. This week, OpenAI open sourced Point-E, a machine learning system that creates a 3D object given a text prompt. According to a paper published alongside the code base, Point-E can produce 3D models in one to two minutes on a single Nvidia V100 GPU. Point-E doesn’t create 3D objects in the traditional sense. Rather, it generates point clouds, or discrete sets of data points in space that represent a 3D shape. (TechCrunch)
Instacart, Databricks, Arm Could Lead the IPO Market Out of Its Freeze. The IPO market remains frozen for now. But once it starts to thaw, the companies that will likely jump into the public markets first are those that can show a path to profitability, have reconciled themselves to lower valuations and—perhaps just as important—are simply sick of waiting. Grocery-delivery firm Instacart, data-focused software company Databricks and cybersecurity firm Arctic Wolf are seen as the highly valued venture-backed tech firms most likely to hold initial public offerings, according to interviews with more than a dozen bankers, lawyers, investors and others who work on IPOs. Each of those firms will be at least a decade old next year, putting more pressure on them to end the long wait for early employees and investors to sell shares. (The Information)
In a major boost for President Joe Biden's pledge to eliminate gas-powered vehicles from the sprawling federal fleet, the Postal Service said it will sharply increase the number of electric-powered delivery trucks — and will go all-electric for new purchases starting in 2026. The post office said it is spending nearly $10 billion to electrify its aging fleet, including installing a modern charging infrastructure at hundreds of postal facilities nationwide and purchasing at least 66,000 electric delivery trucks in the next five years. The spending includes $3 billion in funding approved under a landmark climate and health policy adopted by Congress last year. (NPR)
TikTok would be banned from most U.S. government devices under a spending bill Congress, the latest push by American lawmakers against the Chinese-owned social media app. The $1.7 trillion package includes requirements for the Biden administration to prohibit most uses of TikTok or any other app created by its owner, ByteDance Ltd. The requirements would apply to the executive branch — with exemptions for national security, law enforcement and research purposes — and don’t appear to cover Congress, where a handful of lawmakers maintain TikTok accounts. (Associated Press)
Taiwan has launched an investigation into TikTok on allegations that the platform is operating illegally on the island. A TikTok affiliate is suspected of setting up shop and conducting business in Taiwan, the Mainland Affairs Council said on Sunday. Mainland-based social media platforms are banned from commercial activities in Taiwan. (Nikkei Asia)
Smart Links
Unfazed by 'crypto winter,' Kazakhstan pursues a curious love affair with bitcoin. (Nikkei Asia)
How the West fell out of love with economic growth. (Economist)
It’s not just you. Everyone really is sick this holiday season as the U.S. battles a ‘worst in a decade’ flu and rising COVID cases. (Fortune)
U.S. Navy awards Amazon Web Services contract worth over $700 mln. (Reuters)
Google’s YouTube in Talks for Rights to NFL Sunday Ticket. (Wall Street Journal)
The great green office crunch: New environmental regulations are being applied to commercial real estate still reeling from the pandemic. (Financial Times)