Friday's economy & business stories

Emergency Fed lending programs to expire under Mnuchin

U.S. Treasury Secretary Steven Mnuchin. Photo: Caroline Brehman-Pool via Getty

The Treasury Department will not extend several Federal Reserve lending programs set to expire by year's end that were put in place at the start of the COVID-19 pandemic.

Why it matters: There is concern that pulling the plug on these loan programs will negatively impact the still-fragile economy. Eliminating the programs could hobble the Fed and make it harder to revive similar assistance under a new Congress.

Dan Primack, author of Pro Rata
Updated Nov 20, 2020 - Health

Pfizer applies for FDA emergency use authorization for coronavirus vaccine

Illustration: Sarah Grillo/Axios

Pfizer and Germany's BioNTech said that they applied on Friday for an FDA emergency use authorization for their coronavirus vaccine.

Why it matters: This could set the stage for initial vaccine distribution in the U.S. by mid-to-late December. It also comes less than two weeks after Pfizer released efficacy data for its vaccine, and just days after releasing safety data — which suggests that fellow vaccine developer Moderna may apply for its emergency use authorization around Thanksgiving.

Nov 20, 2020 - Economy & Business

What we're driving: 2021 Kia K5

Photo: Kia

Mid-sized sedans tend to be overshadowed by trucks and SUVs these days, but the new 2021 Kia K5 demands to be noticed.

The big picture: The K5 replaces the long-running Kia Optima, a decent, value-oriented sedan. But the K5 seriously ramps up the appeal with head-turning design, new engine and transmission options, and available all-wheel drive.

Nov 20, 2020 - Economy & Business

U.S. lays groundwork for self-driving car standards

Illustration: Eniola Odetunde/Axios

U.S. auto safety regulators began a regulatory process on Thursday to solicit public input on how to ensure the safety of future self-driving vehicles.

Why it matters: The proposed rulemaking is a step toward the adoption of new safety standards for autonomous vehicles, but it could be years before any rules are final.

Nov 20, 2020 - Economy & Business

Touchless travel could threaten airport jobs

Illustration: Annelise Capossela/Axios

Air travel is becoming a touchless, self-directed journey, which poses a threat to traditional airport customer service jobs.

Why it matters: Automation and artificial intelligence have long been viewed as a threat to jobs, but the unprecedented disruption that the coronavirus pandemic is posing to the travel industry could have lasting workforce implications.

Nov 20, 2020 - Economy & Business

Ezra Klein and Lauren Williams are leaving Vox

Photo: Vox Media

Ezra Klein, co-founder and editor-at-large of Vox.com, the political news website owned by Vox Media, and Lauren Williams, editor-in-chief and senior vice president of Vox.com, are leaving the company, executives tell Axios.

Why it matters: They are the latest examples of high-profile media executives to leave management roles in pursuit of more hands-on, creative careers.

Dan Primack, author of Pro Rata
Nov 20, 2020 - Economy & Business

Robert Smith's image rehab

Illustration: Eniola Odetunde/Axios

Robert Smith on Wednesday made his first public appearance since copping to tax fraud, and agreeing to pay $140 million in back taxes and penalties, appearing on a "Race and Corporate America" panel at the New York Times DealBook Summit.

Why it matters: Smith didn't just get a pass, he got image rehab from his fellow panelists.

Ben Geman, author of Generate
Nov 20, 2020 - Technology

Microsoft's next phase of climate lobbying

Illustration: Sarah Grillo/Axios

Microsoft has brought on the government affairs firm Lot Sixteen to lobby on sustainability and climate change, a newly public filing shows.

Why it matters: While Microsoft has lots of in-house and outside lobbyists working on all sorts of things, it's the first time an outside firm will be lobbying only on climate and environmental topics, Microsoft confirmed.

Ben Geman, author of Generate
Nov 20, 2020 - Energy & Environment

Why Tesla's market cap is soaring far past GM's

Expand chart
Data: FactSet; Chart: Sara Wise/Axios

Tesla is soaring past General Motors in market capitalization — even as electric vehicles remain still a tiny slice of vehicle sales and FM's overall sales far outstrip Tesla's.

Why it matters: Tesla's enormous market value helps to show how investors see vehicles with a plug as the future, even though internal combustion vehicles will dominate for a long time to come.

Felix Salmon, author of Capital
Nov 20, 2020 - Economy & Business

Spanish banker BBVA to exit U.S. market, sell holdings to PNC

Illustration: Sarah Grillo/Axios

Spanish banking giant BBVA has decided to exit the U.S. market. It remains the owner of BBVA Bancomer, the largest bank in Mexico.

Why it matters: In the 2000s, BBVA went on something of a spending spree in Texas and other border states, buying up a series of banks culminating in the $9.6 billion acquisition of Compass Bancshares in 2007.

Felix Salmon, author of Capital
Nov 20, 2020 - Economy & Business

Affirm's 2-in-1 business model

Illustration: Sarah Grillo/Axios

Buy-now-pay-later lender Affirm, which also filed to go public this week, seeks out the kind of customers that most lenders tend to shun, treats them very well, and builds loyalty that way.

Affirm also has a roaring business financing the purchase of Peloton exercise equipment, which is generally bought by a more well-heeled clientele, most of whom have abundant access to credit.

Felix Salmon, author of Capital
Nov 20, 2020 - Economy & Business

DoorDash and Airbnb prove corporate giants can scale in small towns

Illustration: Annelise Capossela/Axios

The race to scale isn't always won by the companies that dominate the largest markets.

Why it matters: DoorDash and Airbnb both filed to go public this week, ratifying the thesis that for real-world businesses, the road to multi-billion-dollar valuations does not need to go through major cities.

Ben Geman, author of Generate
Nov 20, 2020 - Energy & Environment

GM aims to take on Tesla with electric vehicle push

Illustration: Lazaro Gamio/Axios

General Motors announced Thursday that it is increasing its investment in electric vehicles and autonomous tech to $27 billion through 2025 — $7 billion more than prior plans — as it seeks a top global position.

Why it matters: It's the clearest sign yet that GM is hoping to challenge Tesla, which dominates U.S. electric vehicle sales. It was already on, but now the competition for the electric vehicle market of the future is really on.

The next steps in Bank of America's $1 billion pledge to fight inequality

Photo: Alex Tai/SOPA Images/LightRocket via Getty Images

Earlier this year, Bank of America committed to spending $1 billion over four years to address racial and income inequality in America, as a reckoning over systemic racism and police brutality took hold of the country. It said in September it would set aside $25 million of that initial sum for jobs initiatives in Black and Hispanic/Latino communities.

Driving the news: Now, we know the bank is giving $1 million to each of 21 colleges and universities with large populations of Black and Latino students: HBCU Morgan State University, St. Louis Community College and the University of Puerto Rico's Río Piedras campus — to name a few.

The brewing stimulus battle between the Fed and Treasury

Illustration: Aïda Amer/Axios

A battle over stimulus escalated in Washington on Thursday night: Treasury Secretary Steven Mnuchin put emergency lending programs it set up alongside the Fed chair Jerome Powell on the chopping block.

Why it matters: The coronavirus pandemic is worse than when these facilities were established in the spring — and economists worry about a resulting steep economic backslide.

Felix Salmon, author of Capital
Nov 20, 2020 - Politics & Policy

Steven Mnuchin acts to hobble the Fed

Photo: Toni L. Sandys/Pool/Getty Images

Treasury Secretary Steven Mnuchin was one of the heroes of the coronavirus crisis, working hand-in-glove with Fed chair Jay Powell to give the central bank all the ammunition it needed to fight the virus and the associated economic recession. Now, he's trying to take that ammunition away.

Why it matters: If he's successful, Mnuchin will effectively disarm the Fed, creating a lot more economic downside once President-elect Biden takes office.