May 18, 2020

Axios AM

🎸 Happy Monday! Situational awareness: Elvis Presley’s Graceland, which calls itself "the second most recognized home in America (after the White House)," will reopen Thursday in Memphis with tours at 25% capacity.

  • "[G]uests will have the unique opportunity to walk in Elvis' footsteps like never before — in your own personal mansion tour space spread out from other guests."

Today's Smart Brevity™ count: 1,169 words ... 4½ minutes.

1 big thing: Pandemic could ignite startup wave

Illustration: Aïda Amer/Axios

Some in Silicon Valley are optimistic this dark period for the economy could spawn a generation of startups whose founders finally got the nudge they needed to make the leap, Axios' Kia Kokalitcheva reports from S.F.

  • Why it matters: During past downturns, recessions have often triggered startup baby booms.
  • After the dotcom bust of the early 2000s, a new wave of small companies emerged to build "Web 2.0." And many of today's industry leaders got started during the Great Recession.

Look for COVID startups to fall into two buckets:

  1. Ideas that were already being considered, and now there's a pause for them to take shape.
  2. Ideas inspired by the current crisis — work-from-home innovations, and ways to do things online that were traditionally offline.

What's happening: Layoffs are swelling at startups, larger pre-IPO tech companies, and public firms like Uber and Lyft.

  • Some are choosing to take new jobs, but many likely have the financial resources to take a step back and try something on their own.

Y Combinator, the famed startup accelerator program, is seeing 15-20% more applicants for its summer program, admissions chief Dalton Caldwell tells Axios.

  • "For the first time in a decade, product people and engineers are open to looking at new jobs," Cleo Capital managing partner Sarah Kunst tells Axios.

Share this story.

2. For your radar: Worthy points by Fed chief

Photo: Chris Albert for "60 Minutes"/CBS News

Fed Chair Jay Powell, in a very interesting "60 Minutes" interview with Scott Pelley, made several points that should be on your radar (video ... transcript):

  • On what metrics he watches hour-by-hour: "[A]t the moment, the thing that matters more than anything else is the medical metrics, frankly."
  • On whether the Fed sees unemployment of 20% to 25%: "[T]hose numbers sound about right for what the peak may be."
  • On whether he thinks history will call this a Second Great Depression: "I don't think that's a likely outcome at all. There're some very fundamental differences. ... [W]e had a very healthy economy two months ago. And this is an outside event — it is a natural disaster, in effect."

Powell, on damage from a prolonged downturn: "There's a real risk that if people are out of work for long periods of time, that their skills atrophy a little bit and they lose contact with the workforce. This is something that shows up in the data — that longer and deeper recessions tend to leave behind damage to people's careers."

  • "You could say the same thing about businesses. The small and medium size businesses, ... if they have to go through a wave of avoidable insolvencies, you've lost ... the job creation machine."

🇺🇸 P.S. David McCormick, chief executive of Bridgewater Associates, writes in the Financial Times (subscription) that America's coronavirus comeback should include a national innovation policy:

  • Support U.S. companies in sectors like high tech with winner-take-all advantages ... Fund development of promising technologies ... Support domestic development of sectors where overseas companies are highly subsidized by U.S. competitors ... Prioritize strategic technologies.
3. Axios interview: Energy secretary invokes redlining

Illustration: Sarah Grillo/Axios

Bank restrictions on financing oil and gas drilling in the Arctic are akin to past practices —known as redlining — of not loaning to communities of color, Energy Secretary Dan Brouillette tells Axios' Amy Harder for her "Harder Line" column.

  • Why it matters: A decades-long battle over Arctic drilling is suddenly escalating. Five of America’s six biggest banks have recently announced they won’t finance oil and gas development in the Arctic, prompting conservative and industry backlash.

Brouillette cited his past work at USAA, a financial services firm: "For years and years and years, banks would not lend money, insurance companies would not write policies in minority areas in the country."

  • "'Redlining' is the term used all throughout those debates," the secretary continued. "I do not think banks should be redlining our oil and gas investment across the country."

Experts said the redlining comparison is inappropriate and inaccurate.

  • Mehrsa Baradaran, a U.C. Irvine law professor and expert on racial discrimination in banking: "A massive corporation being cut off from a few banks is absolutely nothing like the systematic exclusion and exploitation of black communities for hundreds of years."

Keep reading.

4. Pictures of America: Reopening weekend
Photo: Kaitlin McKeown/The (Newport News) Daily Press via AP

Above: Virginia Beach oceanfront on Saturday.

Below: Jaime Susano of Buckeye Union High School in Arizona celebrates during a drive-thru ceremony, Parade of Graduates, on the track at Phoenix Raceway.

Photo: Ross D. Franklin/AP
Photo: Jenna Fryer/AP

Above: NASCAR, trying to stave off financial ruin, brought back live sports yesterday in Darlington, S.C., with no tailgating and no fans in the stands.

Below: Kevin Harvick celebrates in a lonely winner's circle.

Photo: Brynn Anderson/AP
5. Stunning stat
Cruise ships idle yesterday in Weymouth Bay off Abbotsbury, England. Photo: Finnbarr Webster/Getty Images

"Two months after the cruise industry shut down, ... more than 100,000 crew members remain trapped at sea with little reliable information about what will happen to them," the Miami Herald reports.

6. Top CEOs to Zoom with White House

Ivanka Trump tours Coastal Sunbelt Produce in Laurel, Md., on Friday. Photo: Andrew Harnik/AP

Ivanka Trump will Zoom tomorrow with Apple's Tim Cook, Lockheed Martin's Marillyn Hewson, the National Association of Manufacturers' Jay Timmons and other CEOs, as the American Workforce Policy Advisory Board meets entirely virtually for the first time.

  • The White House says the discussion will include "the need for better digital infrastructure and home connectivity."

Ivanka Trump said: "The White House is thankful that companies like Udacity, Western Governors University, Coursera and other online learning platforms are stepping up during this crisis to meet American students and workers where they are."

7. Cover du jour
Courtesy of The New Yorker

The New Yorker cover is "Natural Ability," by Barry Blitt (new winner of the Pulitzer Prize for Editorial Cartooning), who tells the magazine's "Cover Story" feature that "nothing would surprise me" about President Trump:

  • "I can’t believe I haven’t drawn him as one of the Rockettes yet."

The drawing's title is based on a Trump boast in March while touring the CDC in Atlanta: "I like this stuff. I really get it. ... Maybe I have a natural ability."

8. New: RNC flexes infrastructure muscle
Via Twitter

The RNC today will announce an eight-figure hiring wave — 300 more Trump Victory staff who'll deploy to target states by June 1, bringing the field staff to 1,100+. 

  • The RNC says Trump Victory, the joint field effort between the party and the Trump campaign, has transitioned volunteers to digital organizing tools like "Trump Talk," which lets them phone bank from home.
  • RNC chief of staff Richard Walters: "These unprecedented efforts are building a political juggernaut that will deliver Republican victories up and down the ballot."

The party says Trump Victory teams made 10 million calls last week, an RNC record.

  • The previous record was in 2018 — 7 million calls in the week before midterms.
9. 🎧 What we're listening to: Behind the mask


A Venice plague doctor wearing a beak-like mask. Photo: De Agostini Picture Library via Getty Images

The N95 respirator, one of the most coveted items during the pandemic, has a storied history, stretching all the way back to plague masks (seen above) during Europe's Black Death in the 1600s.

  • NPR's history podcast Throughline focused on Sara Little Turnbull, a 3M product designer who was tasked to build a better bra cup in 1958 — and realized that it might instead be the medical mask of the future.

Listen (transcript).

10. 🚪 1 smile to go: Return of ding-dong-ditch-'em

Our era of social distancing is fueling the return of ding-dong ditch, "giving grown-ups a much-needed dose of nostalgia and mischief," writes Ellen Byron for a Wall Street Journal A-hed.

  • But instead of leaving a victim hanging at the door, "the latest version includes leaving a treat before running away, lending a kinder twist on the prank."

"It is showing up in our purchase data that people are utilizing Ding Dongs as a way to reimagine this version of an old childhood game," Hostess Brands' chief marketing officer told the Journal.

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