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The conventional wisdom about Amazon is that its prices are so low that it earns no money. But Thomas Paulson, principal at Minneapolis-based Inflection Capital Management, points out that, when you strip out its enormous investment in itself, Amazon earns exceptional profits.

Expand chart
Data: Amazon's and Walmart's 10-Ks and 10-Qs, and Inflection Capital analysis; Note: Retail profit margin is before taxes, interest payments, and other adjustments including .com losses at Walmart. Amazon data only includes already developed markets, and not Prime Video, G&A or tech & content costs. Chart: Andrew Witherspoon / Axios

Why it matters: Walmart's gross revenue is far greater than Amazon's—$485.9 billion in 2016, compared with $136 billion for Amazon. And Walmart is earning big net profits now. But Amazon's higher margins — and its upward trajectory — are a signal for what could be coming down the road if CEO Jeff Bezos decides to start delivering more cash to shareholders.

By the numbers: After spending for expansion, such as developing its market in India, China and Europe, along with other costs such as taxes, Amazon earned about 16 cents on every dollar in 2016 sales, Paulson says. That is 140% higher than Walmart, Amazon's greatest competition at the moment, which compares with 6.8 cents of net profit before such costs (chart above).

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The "war on nature"

A resident stands on his roof as the Blue Ridge Fire burned back in October in Chino Hills, Calif. Photo: Jae C. Hong/AP

Apocalyptic weather is the new normal because humans are "waging war on nature," the UN declared on Wednesday.

What they're saying: "The state of the planet is broken," said UN Secretary-General António Guterres, reports AP. “This is suicidal.”

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Health: Nursing homes are still getting pummeledU.S. could hit herd immunity by end of summer 2021 if Americans embrace virus vaccines, Fauci says.
  2. Politics: Pelosi, Schumer call on McConnell to adopt bipartisan $900B stimulus framework.
  3. World: U.K. clears Pfizer-BioNTech vaccine for mass rollout — Putin says Russia will begin large-scale vaccination next week.
  4. Business: Investors are finally starting to take their money out of safe-haven Treasuries.
  5. Sports: The end of COVID’s grip on sports may be in sight.

Pelosi, Schumer call on McConnell to adopt bipartisan $900B stimulus framework

House Speaker Nancy Pelosi on Nov. 20. Photo: Drew Angerer/Getty Images

House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) on Wednesday urged Senate Majority Leader Mitch McConnell (R-Ky.) to use a $908 billion bipartisan coronavirus relief framework as a basis for jumpstarting negotiations.

Why it matters: The framework, introduced by a group of bipartisan senators on Tuesday, calls for significantly less funding than Pelosi had previously demanded — a sign that Democrats are ready to further compromise as millions of Americans endure economic hardship.

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