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Illustration: Sarah Grillo/Axios

Aramco, Saudi Arabia's state-owned oil company, promised this week that it would set a dividend of at least $75 billion through 2024 — or, that non-government shareholders would receive at least $750 million in dividends for every 1% of the company that they own, from 2020 through 2024.

Why it matters: Because the Saudi royal family controls Aramco, it doesn't need the company to pay any dividends at all. If they need to extract money from Aramco, they can always raise the company's tax rate, or simply expropriate what they need.

  • Foreign shareholders could be stuck with worthless shares paying zero dividends.

Between the lines: In many ways the Aramco situation is similar to that of Fannie Mae and Freddie Mac. The U.S. government controls the agencies and their profits. Private shareholders, who own 20% of the equity in the companies, have received nothing from them for over a decade.

  • If the U.S. government allowed Fannie and Freddie to start paying a dividend, shares would rise. But so long as the government holds the reins, shareholders know that their cashflows can always revert to zero at any time.
  • The bull case for Aramco shares is that the Saudi government wants to see a multitrillion-dollar valuation for the company. If that fact ever changes, then it's hard to see foreign shareholders being able to extract much value.

Why you’ll hear about this again: Investing in autocracies is part of modern capitalism. In China, for instance, PayPal is buying Gopay, a local payments provider.

  • It's easy to see why PayPal wants exposure to the massive Chinese market — but at the same time the company knows there's always a risk of the government turning against it and nullifying the deal.
  • If that happens, PayPal has no real recourse. (It's not going to sue the Chinese government in Chinese courts.)

The bottom line: In countries with robust civil societies, shareholders have significant legally enforceable rights, and those rights underpin the value of their shares. In countries like China and Saudi Arabia, by contrast, foreign shareholders only win insofar as it behooves the local government to keep them happy.

Go deeper: Saudi Aramco revs up IPO sales pitch

Go deeper

Broncos and 49ers the latest NFL teams impacted by coronavirus crisis

From left, Denver Broncos quarterbacks Drew Lock, Brett Rypien and Jeff Driskel during an August training session at UCHealth Training Center in Englewood, Colorado. Photo: Justin Edmonds/Getty Images

The COVID-19 pandemic has thrown the NFL season into chaos, with the Denver Broncos' quarterbacks sidelined, the San Francisco 49ers left without a home or practice ground and much of the Baltimore Ravens team unavailable, per AP.

Driving the news: The Broncos confirmed in a statement Saturday night that quarterbacks Drew Lock, Brett Rypien and Blake Bortles were identified as "high-risk COVID-19 close contacts" and will follow the NFL's mandatory five-day quarantine, making them ineligible for Sunday's game against New Orleans.

Updated 5 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: WHO: AstraZeneca vaccine must be evaluated on "more than a press release."
  2. Politics: McConnell temporarily halts in-person lunches for GOP caucus.
  3. Economy: Safety nets to disappear in DecemberAmazon hires 1,400 workers a day throughout pandemic.
  4. Education: U.S. public school enrollment drops as pandemic persists.
  5. Cities: Surge in cases forces San Francisco to impose curfew — Los Angeles County issues stay-at-home order, limits gatherings.
  6. Sports: NFL bans in-person team activities Monday, Tuesday due to COVID-19 surge — NBA announces new coronavirus protocols.
  7. World: London police arrest more than 150 during anti-lockdown protests — Thailand, Philippines sign deal with AstraZeneca for vaccine.

Tony Hsieh, longtime Zappos CEO, dies at 46

Tony Hsieh. Photo: FilmMagic/FilmMagic

Tony Hsieh, the longtime ex-chief executive of Zappos, died on Friday after being injured in a house fire, his lawyer told the Las Vegas Review-Journal. He was 46.

The big picture: Hsieh was known for his unique approach to management, and following the 2008 recession his ongoing investment and efforts to revitalize the downtown Las Vegas area.