May 27, 2020

Axios AM

Happy Wednesday!

  • Today's Smart Brevity™ count: 1,124 words, 4 minutes.
1 big thing: Hackers pivot to vaccine espionage

Illustration: Aïda Amer/Axios

A wave of cyber-spying is targeting COVID-19 medical research, the Aspen Institute's Zach Dorfman writes for the relaunch of Axios' weekly cybersecurity newsletter, Codebook. (Sign up here.)

  • An FBI bulletin this month said "nation-state cyber actors are targeting COVID-19-related research as many foreign governments seek to accelerate their own R&D processes and clinical trials."
  • Since February, suspected foreign government hackers have compromised systems at a "health care-related" company and a "U.S. research entity," and have targeted other medical, pharmaceutical and academic institutions, the FBI said.

Why it matters: Nothing is more valuable right now, anywhere on the planet.

  • The country that’s first with a vaccine will, in theory, benefit immensely. Elections may be won or lost because of it. Industries and entire economies hang in the balance. Social stability may depend on vaccine access.

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2. Hong Kong in danger

Illustration: Sarah Grillo/Axios

As Beijing forces a sweeping national security law on Hong Kong, the once semi-autonomous city's status as one of Asia's largest financial hubs is in danger, Axios China reporter Bethany Allen-Ebrahimian writes.

  • Why it matters: China's leaders may be betting that top firms in Hong Kong will trade some political freedoms for the economic prosperity Beijing can offer.

What's happening: Last week, the National People's Congress, China's rubber-stamp legislature, unveiled a new security law that will criminalize sedition, foreign influence and secession in Hong Kong.

What to watch: The ball is now in America's court. The U.S. has long granted special status to Hong Kong, where more than 1,300 U.S. companies operate.

  • Beijing's leaders may be counting on the reluctance of Western countries, especially the U.S., to take immediate actions that would hurt trade.

In the long run, the Chinese Communist Party has aimed to turn Shanghai and Shenzhen into alternative centers for international finance.

3. Home sales show Americans looking past virus

Illustration: Aïda Amer/Axios

Americans are behaving very differently than in previous recessions: Convinced that the coronavirus pandemic will soon pass, many continue to spend money as if nothing has changed, Axios Markets editor Dion Rabouin writes.

  • The latest example is the Commerce Department's new home sales report, which showed home sales increased in April, despite nationwide lockdowns that banned real estate agents in some states from even showing listed houses.
  • Sales of newly built homes rose by 1% in April compared with March, dramatically outpacing economists' expectations for a 22% decline.

What's happening: Lawrence Yun, chief economist at the National Association of Realtors, tells Axios four main factors are driving the market's strength.

  1. Dwindling supply as a result of fewer homes being built in recent years and older people not moving.
  2. Historically low mortgage rates.
  3. The CARES Act moratorium on residential foreclosures for borrowers with federally backed mortgage loans.
  4. Consumers who were locked out of the market in 2019 and are confident prices will continue to rise even in the face of the recession.
4. "Please, I can't breathe"

Photo: Kerem Yucel/AFP via Getty Images

Marchers protest last night near the spot in Minneapolis where George Floyd, 47, died Monday evening while in police custody, prompting the firing of four officers.

  • Bystander video showed the handcuffed black man dying while a white policeman knelt on his neck for more than five minutes.
  • Floyd, who worked as a security guard at a local restaurant, pleaded: "Please, please, please I can’t breathe. Please, man." (N.Y. Times)

Police had detained him on suspicion of trying to pass a fake $20 bill at a convenience store, the Minneapolis Star Tribune reports.

  • "Being black in America should not be a death sentence," said a visibly shaken Mayor Jacob Frey.
5. Why space is good politics

Illustration: Sarah Grillo/Axios

President Trump's exuberance about today's scheduled SpaceX launch (4:33 p.m. ET) — including his decision to travel to Florida to watch — goes beyond a personal fascination with astronauts and rockets, or making money and wielding power in the next frontier, Axios' Margaret Talev and Miriam Kramer write.

  • Why it matters: There's a presidential election in November, and the U.S. space program enjoys wide support across party lines.

Private-sector spaceflight holds the promise of new economic — and literal — frontiers at a time when Americans could use optimism about the future.

  • Florida, Florida, Florida: Kennedy Space Center, site of the launch, is nestled in one of the most crucial battleground states for Trump's bid for re-election.

Joe Biden also wants to be affiliated with the milestone.

  • His campaign organized a press call with former NASA administrator Charles Bolden and former Sen. Bill Nelson of Florida, crediting the former V.P. as a key Obama administration advocate in paving the way for the launch.

The big picture: During last year's 50th anniversary of the Apollo 11 moon landing, pollsters found NASA enjoys a two-decade high in support.

  • Support for NASA unites Democrats and Republicans, women and men, and Americans of all ages.

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6. Downsides of remote work
Data: Reproduced from Prudential/Morning Consult "Pulse of the American Worker Survey"; Chart: Axios Visuals

The downsides of remote work — less casual interaction with colleagues, an over-reliance on Zoom, lack of in-person collaboration and longer hours — could over time diminish the short-term gains, Axios' Kim Hart writes.

  • Why it matters: Over time, goodwill with colleagues can break down without social, offline interactions to reinforce the personal relationships. And new hires during this all-remote period don't have the benefit of building those connections.
  • "The longer we remain fully remote, the more difficult it is going to be to mitigate a rate of decay in culture," said Rob Falzon, vice chair of Prudential and architect of Prudential’s Future of Work initiative. "That should be keeping leaders up at night."

A majority of U.S. remote workers (59%) report feeling as productive as they do in the office, according to a Morning Consult survey of full-time workers, on behalf of Prudential.

  • But about half also report feeling less connected to their company (55%), more stressed in ways that negatively impact their work (46%), and working more hours from home (47%).

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7. Twitter adds fact checks to Trump tweets
Via Twitter

Twitter yesterday labeled two election-related tweets from President Trump as potentially misleading — the first time the company has taken action against the president's tweets, which critics have long cited for abuse and misinformation.

  • Why it matters: The move by Twitter reflects the degree to which the policing of social-media content has become an overpoweringly partisan issue, Axios' Ina Fried and Sara Fischer report.

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8. NYSE floor reopens

Photo: Johannes Eisele/AFP via Getty Images

New York Gov. Andrew Cuomo rang the iconic bell to reopen the New York Stock Exchange trading floor for the first time since mid-March, but the usual hubbub was subdued under new pandemic rules, AP's Matt Ott writes.

  • Anyone entering the Exchange at 11 Wall Street is being asked to avoid public transportation, and will have their temperature taken before entry, said Stacey Cunningham, president of the NYSE.


9. 🏒 NHL reveals pro sports' most detailed return plan
Data: NHL. Table: Axios Visuals

Two and a half months after shutting down because of the coronavirus outbreak, the NHL became the largest North American pro sports league to announce definitive plans for a return, Axios Sports editor Kendall Baker writes.

  • NHL Commissioner Gary Bettman announced yesterday that 24 teams would return, if and when medically cleared, for a unique playoff tournament in two hub cities.
  • The finalists: Chicago ... Columbus, Ohio ... Dallas ... Vegas ... Pittsburgh ... Minneapolis/St. Paul ... + Edmonton, Toronto and Vancouver in Canada.

Training camps will resume no earlier than July 1.

  • The season will conclude with the presentation of the Stanley Cup in early autumn.

🏈 ⚽🏀 ⚾ Sign up for Kendall Baker's daily newsletter, Axios Sports.

10. 1 smile to go: Maryland mansion has vintage town in basement

Photo: Washington Fine Properties

A $4.5 million, four-acre estate for sale in the Round Hill enclave of Potomac, Md., includes a basement party space modeled after a turn-of-the-2oth-century Georgetown street.

  • The listing agent, Lori Leasure of Washington Fine Properties, tells me the wonderland includes cobblestone streets ... authentic store fronts ... real, working cars ... and an English pub.  
  • "They are mostly facades, but some doors do open to mechanical spaces or a side-load garage, which is how the cars can be brought in and out," Leasure said.

See more photos.

Photo: Washington Fine Properties

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