Photo: Interim Archives/Getty Images

This was a big week for financiers looking to make enormous profits from the empire-building ambitions of businesses with dubious business models.

Exhibit 1: WeWork is planning to go public next month, raising some $3.5 billion. But this is a world where Uber can lose $5.2 billion in a single quarter, and potential shareholders are worried that $3.5 billion still won't be enough. So WeWork is raising $6 billion in debt, too.

  • Leading both deals: JPMorgan Chase, whose CEO, Jamie Dimon, has been buttering up WeWork executives for years.
  • Be smart: WeWork (or just We, as it now wants to be known) is generally considered an office-rental company, even if its CEO likes to say that it's more about energy, spirituality and elevating the world's consciousness. In reality, WeWork is a creature of the international capital markets, upon which it is reliant and without which it could never have been born in the first place. As a vehicle for funneling fees to Wall Street, it has few equals. Hence the personal attention from Dimon.

Exhibit 2: The huge media merger of the week is the acquisition of newspaper chain Gannett by its smaller rival GateHouse. In order to get the deal done, GateHouse parent New Media Investment Group is borrowing $1.8 billion from Apollo at an eye-popping interest rate of 11.5%.

  • Between the lines: The interest rate worries GateHouse shareholders: It clearly reflects an extremely high probability of default, in which case their equity would go to zero and Apollo would end up owning the combined company.
  • It's possible Apollo wants GateHouse to default on its loan. The private-equity giant has already quietly accumulated a very large position in local TV and local radio; local newspapers could fill out the portfolio nicely.

The bottom line: Whether WeWork and GateHouse succeed or fail, JPMorgan and Apollo are likely to come out ahead. It's a nice position to be in.

Go deeper

Updated 48 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Politics: Trump calls Fauci a "disaster" on campaign call.
  2. Health: Coronavirus hospitalizations are on the rise — 8 states set single-day coronavirus case records last week.
  3. States: California to independently review FDA-approved coronavirus vaccines
  4. Wisconsin judge reimposes capacity limit on indoor venues.
  5. Media: Trump attacks CNN as "dumb b*stards" for continuing to cover pandemic.
  6. Business: Consumer confidence surveys show Americans are getting nervousHow China's economy bounced back from coronavirus.
  7. Sports: We've entered the era of limited fan attendance.
  8. Education: Why education technology can’t save remote learning.
Dion Rabouin, author of Markets
1 hour ago - Economy & Business

The 2020 holiday season may just kill Main Street

Illustration: Eniola Odetunde/Axios

Online retail and e-commerce have been chipping away at brick-and-mortar businesses over the years but the combination of the coronavirus pandemic and the 2020 holiday season may prove to be a knockout blow.

State of play: Anxious consumers say financial concerns and health worries will push them to spend less money this year and to do more of their limited spending online.

California to independently review FDA-approved coronavirus vaccines

California Gov. Gavin Newsom. Photo: Justin Sullivan/Getty Images

California will "independently review" all coronavirus vaccines approved by the Food and Drug Administration before allowing their distribution, Gov. Gavin Newsom (D) announced at a news conference Monday.

Why it matters: The move that comes days after NAID director Anthony Fauci said he had "strong confidence" in FDA-approved vaccines could cast further public doubt that the federal government could release a vaccine based on political motives, rather than safety and efficacy.