Economy & Business

Why it matters: After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

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The sluggish rebound for services

Data: U.S. Department of Commerce; Chart: Axios Visuals

The coronavirus recession is technically over, but the GDP report makes clear the most important part of the U.S. economy — the services sector — is still mired in a severe downturn.

Why it matters: It makes up a whopping 70% of the U.S. economy. The services sector is also comprised of what has become undesirable in the wake of the pandemic, including eating in restaurants and traveling.

Wall Street braces for more turbulence ahead of Election Day

Illustration: Eniola Odetunde/Axios

Wall Street is digging in for a potentially rocky period as Election Day gets closer.

Why it matters: Investors are facing a "three-headed monster," Brian Belski, chief investment strategist at BMO Capital Markets, tells Axios — a worsening pandemic, an economic stimulus package in limbo, and an imminent election.

Intercept founder's move spotlights solo journalism's lure and limits

Illustration: Aïda Amer/Axios

More high-profile journalists — most of them white men — are leaving newsrooms to launch newsletters on Substack and other independent publishing platforms.

Driving the news: Glenn Greenwald, a columnist at The Intercept, is quitting the publication he co-founded after seven years, citing efforts by his editors to "censor" articles critical of former Vice President Joe Biden.

Updated 10 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Large coronavirus outbreaks leading to high death rates — Coronavirus cases are at an all-time high ahead of Election Day — U.S. tops 88,000 COVID-19 cases, setting new single-day record.
  2. Politics: States beg for Warp Speed billions.
  3. World: Taiwan reaches a record 200 days with no local coronavirus cases.
  4. 🎧Podcast: The vaccine race turns toward nationalism.
11 hours ago - Politics & Policy

Technical glitch in Facebook's ad tools creates political firestorm

Facebook CEO Mark Zuckerberg. Photo: SOPA Images / Contributor

Facebook said late Thursday that a mix of "technical problems" and confusion among advertisers around its new political ad ban rules caused issues affecting ad campaigns of both parties.

Why it matters: A report out Thursday morning suggested the ad tools were causing campaign ads, even those that adhered to Facebook's new rules, to be paused. Very quickly, political campaigners began asserting the tech giant was enforcing policies in a way that was biased against their campaigns.

12 hours ago - Politics & Policy

Twitter labels tweet from RT implying voter fraud in U.S. elections

Photo: Omar Marques/SOPA Images/LightRocket via Getty Images

Twitter on Thursday labeled a tweet from Russian state media outlet RT (formerly Russia Today) that included a video implying widespread voter fraud is plaguing, and potentially delegitimizing, the U.S. election.

Why it matters: It's the first time Twitter has labeled RT's account with a civic integrity label, or a designation used to highlight efforts to manipulate or interfere in elections or other civic processes.

Walmart pulls guns, ammunition from U.S. stores, citing "civil unrest"

Photo: Blake Nissen/The Boston Globe via Getty Images

Walmart removed all guns and ammunition displays from its 4,700 U.S. stores this week as a “precaution for the safety of our associates and customers," citing "some isolated civil unrest" in Philadelphia.

Why it matters: In an email to the New York Times, a company spokesperson said the decision was prompted by the recent protests and looting in Philadelphia following the fatal police shooting of Walter Wallace, a 27-year-old Black man.

Video could be new gold standard for urban traffic management

Illustration: Aïda Amer/Axios

Here's a thought that occurred to a few people while weaving their cars through double-parked Amazon trucks and Ubers: Let's find a way to monetize those scofflaws.

Why it matters: Video cameras mounted on city streets — and connected to the right software and technology — could one day be a gold standard for urban traffic management.

16 hours ago - Economy & Business

Exclusive: Insider Inc. buys majority stake in Morning Brew in all-cash deal

Morning Brew

Insider Inc., the parent company to Business Insider, closed an all-cash deal Thursday to buy a majority stake in Morning Brew, a media startup that focuses on business newsletters and podcasts.

Why it matters: It's an unusual success story amid a bleak media landscape. Morning Brew's co-founders, both under 30, raised very little capital upfront to launch their business but still managed to be quite profitable.

Netflix adds $2 charge to premium plan, hikes standard plan by $1

Illustration: Sarah Grillo/Axios

Netflix announced Thursday it will charge customers $14 for its standard monthly subscriber plan and $18 for the premium plan, the Verge reports.

The big picture: The business model behind Netflix's strategy is to accumulate as many users worldwide with as much original and licensed content as possible, and then hike the monthly subscription prices on those users once they are hooked.

Sending garbage underground by pneumatic tube

Envac's automated vacuum collection system. Source: Envac

Trash systems that use vacuum suction and pneumatic tubes to whoosh garbage from people's homes and sidewalk bins have been around for decades, but are gaining new traction in the U.S.

Why it matters: These systems — which currently serve Disney World and Manhattan's Roosevelt Island — get municipal garbage trucks off the streets and offer a cleaner and more environmentally friendly waste removal.

18 hours ago - Podcasts

The vaccine race turns toward nationalism

The coronavirus pandemic is worsening, both in the U.S. and abroad, with cases, hospitalizations and deaths all rising.

Axios Re:Cap digs into the state of global vaccine development — including why the U.S. and China seem to going at it alone — with medicinal chemist and biotech blogger Derek Lowe.

Felix Salmon, author of Capital
Updated 19 hours ago - Economy & Business

How central banks can save the world

Illustration: Aïda Amer/Axios

The trillion-dollar gap between actual GDP and potential GDP is a gap made up of misery, unemployment, and unfulfilled promise. It's also a gap that can be eradicated — if central banks embrace unconventional monetary policy.

  • That's the message from Eric Lonergan and Megan Greene, two economists who reject the idea that central banks have hit a "lower bound" on interest rates. In fact, they reject the idea that "interest rates" are a singular thing at all, and they fullthroatedly reject the idea — most recently put forward by New York Fed president Bill Dudley — that the Fed is "out of firepower."

Why it matters: If Lonergan and Greene are right, then central banks have effectively unlimited ammunition in their fight to increase inflation and employment. They are limited only by political will.

Dan Primack, author of Pro Rata
21 hours ago - Economy & Business

Leon Black says he "made a terrible mistake" doing business with Jeffrey Epstein

Photo illustration: Sarah Grillo/Axios. Photo: Rick Friedman/Corbis/Getty Images

Apollo Global Management CEO Leon Black on Thursday said during an earnings call that he made a "terrible mistake" by employing Jeffrey Epstein to work on personal financial and philanthropic services.

Why it matters: Apollo is one of the world's largest private equity firms, and already has lost at least one major client over Black's involvement with Epstein.

Dan Primack, author of Pro Rata
22 hours ago - Economy & Business

LVMH-Tiffany deal is back on for $15.8 billion

Illustration: Sarah Grillo/Axios

LVMH and Tiffany & Co. have reconciled, with LVMH now to buy the U.S. jeweler for around $15.8 billion. That's about $425 million lower than the original agreement, signed last November, with the per share price dropping from $135 to $131.50.

Why it matters: This heads off what was shaping up to be a nasty court battle.

Dan Primack, author of Pro Rata
22 hours ago - Economy & Business

SoftBank CEO under fire for text messages on business turmoil

Illustration: Eniola Odetunde/Axios

Someone should tell SoftBank CEO Masayoshi Son he could use encrypted apps like Signal and Telegram when communicating with his lieutenants.

Driving the news: Former WeWork CEO Adam Neumann won a Delaware court motion to remove redactions on select text messages between Son and Marcelo Claure, the SoftBank COO and WeWork executive chairman, as part of his lawsuit against SoftBank for bailing on its $3 billion tender offer for WeWork shares.

Ina Fried, author of Login
23 hours ago - Economy & Business

Grubhub sued for listing restaurants without permission

Illustration: Aïda Amer/Axios

Two restaurant owners have filed a potential class action lawsuit against Grubhub, saying that the online food delivery service added their establishments without permission.

Why it matters: While intermediary services have touted their role in supporting independent restaurants and businesses during the pandemic, many have gone to great lengths to grab business that otherwise might have gone direct to the establishment.

U.S. economy sees record growth in third quarter

The U.S. economy grew at a 33.1% annualized pace in the third quarter, the Commerce Department said on Thursday.

The state of play: The record growth follows easing of the coronavirus-driven lockdowns that pushed the economy to the worst-ever contraction — but GDP still remains well below its pre-pandemic level.

Ben Geman, author of Generate
23 hours ago - Energy & Environment

Shell posts profit and boosts dividend

Royal Dutch Shell PLC sign. Photo: Aleksander Kalka/NurPhoto via Getty Images

Royal Dutch Shell reported a nearly $1 billion third-quarter profit Thursday, beating analysts' forecasts, and announced a slight increase in dividends.

Driving the news: Its stock is up 3% in premarket trading this morning but remains at roughly 25-year lows as the sector faces headwinds from COVID-19's effect on prices and demand.

Dion Rabouin, author of Markets
Oct 29, 2020 - Economy & Business

Investors have nowhere to hide

Photo: Jeenah Moon/Getty Images

The massive losses in oil prices and U.S. and European equities were not countered by gains in traditional safe-haven assets on Wednesday.

Why it matters: The unusual movement in typical hedging tools like bonds, precious metals and currencies means they are not providing investors an asset that will appreciate in the event of a major equity selloff.

Ina Fried, author of Login
Oct 29, 2020 - Economy & Business

Earnings reports to show if tech can keep growing in a pandemic

Illustration: Eniola Odetunde/Axios

Apple, Facebook, Google and Amazon are all slated to report earnings after the markets close today, and that should give us a much better sense of how the tech industry is faring through the pandemic.

Why it matters: The reports should offer a clue of how sustainable tech's "new normal" is. That's especially important given that experts predict another and stronger wave of coronavirus in the U.S. that could force continued reliance on remote work for office employees.

Oct 29, 2020 - Economy & Business

Spotify has a Joe Rogan dilemma

Illustration: Sarah Grillo/Axios

Spotify is getting slammed for allowing Joe Rogan, one of its most popular podcasters, to host far-right conspiracy theorist Alex Jones on his show.

Why it matters: The company, which still distributes mostly music, will begin to encounter more of these types of problems as it expands its podcast business.

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