Friday , April 10 2020
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Corona Tools 5

“You are incredibly safe to go out (and vote for us)”, says a man draped in PPE. This isn’t about bragging rights. This is about addressing the Now, with McKinsey.  Have you redeemed your quarantine free pass yet? Does your trolley contain illegitimate and unnecessary items? Northants police is watching you.  “Suggestions made in the media”. ...

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Is Uber too big to fail?

© AFP via Getty Images Before the crisis, Uber’s UK operations were facing an existential reckoning. If the ride-hailing app were to lose its final appeal against the Employment Tribunal decision that classified its drivers as workers rather than contractors, not only would its operational costs be heightened to a point it might not be viable to operate in the UK, it risked a retrospective VAT bill from HMRC amounting to as much as £1.5bn.While there is still no news of the final...

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Markets Now – Thursday 9th April 2020

It’d be dumb and meaningless to overlay the FTSE 100 onto a graph showing global coronavirus deaths. But if recent history has taught us anything it’s that a great many people think they can figure things out from a graph, so we’ve done it anyway. Today’s early rally seems to be fading a bit, having always been easier to attribute to net underweight equities positioning than curve-flattening V-shaped optimism.  Stresses and dislocations have undoubtedly eased, however, as bond markets...

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Leading ‘UK’ start-ups want a handout too

© Getty Images On Wednesday, a letter arrived addressed to Rishi Sunak, the current UK chancellor of the exchequer. Signed by the “founders and CEOs of leading UK companies”, the letter implores Mr Sunak to set up a task force to help those high-growth tech companies who aren’t able to access the various government support schemes in part because they’ve “invested in technology and growth rather than short term profitability”. (The full thing can be read here on TechCrunch.)What...

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Further reading

Elsewhere on Thursday: – The long-run economic impact of Covid-19. – Karol Sikora’s plan for an exit strategy. – Tesla set to slash pay. – SEC suspends trading in two shares over lack of information amid pandemic. (WSJ, $) – US intelligence had warned of crisis since November. – How the pandemic is shining a spotlight on the wildlife trade. – Wuhan residents can now leave the city. – Coronavirus deaths linked to higher levels of air pollution. – EU Commission hands ESG banking regulation...

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Forecasts in the time of coronavirus

© AP In the past few weeks Alphaville has, multiple times, considered adding to our ‘This is nuts. When’s the crash?’ series, but has struggled to really justify it. If you’ve not read one of the articles before, it involves a team member poking holes in the stratospheric valuation of whatever hot tech/ cannabis/ blockchain stock is capturing the market’s attention at that time.Some we’ve got right, and some we’ve got wrong. So far, anyway.The problem in the era of coronavirus is that...

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Markets Now – Wednesday 8th April 2020

Hey look, it’s a bunch of insurers telling people that through no fault of their own they won’t be getting the money that was specified in their contracts. How out of character. Aviva, Direct Line, RSA and Hiscox have all suspended 2019 dividends under regulatory duress. That follows Sabre on Tuesday saying it will suspend its special dividend. The Prudential Regulation Authority said it welcomes “the prudent decision”, having last month sent an open letter nagging about crisis capital...

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Further reading

Elsewhere on Wednesday, -- Boris and the scientists.-- Donald and the advisers.-- And their memos.-- “I don’t take responsibility at all.”-- The 5G conspiracy theory.-- The strange lead-up to Boris’s admission to hospital.-- Lagarde, playing catch-up.-- Art gallery thieves.-- Short selling bans... work?-- When greed and fear collide....

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It looks like Elon Musk delivered some actual ventilators

© REUTERS Last Thursday, we appear to have been responsible for triggering a considerable amount of distress (not to say bile) among Muskovites the world over. We had pointed out that their dear leader Elon Musk, after saying he had bought 1,255 “FDA-approved” ventilators from China to donate to hospitals in the US, had actually delivered something a little different from what one would normally call ventilators: BPAP machines. These are normally used to treat sleep apnoea, and are...

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Why scrapping dividends is a capital idea

© Bloomberg Europe’s banks announced last week that they would withhold dividends due to the impact of the coronavirus pandemic on their balance sheets. Insurers are being urged to do the same. The pledge came on the back of raised eyebrows among Europe’s banking watchdogs and this FT op-ed from the Bank for International Settlements’ general manager Agustín Carstens (our emphasis, here and throughout):Now is the time to draw on the accumulated balance sheet buffers that were built...

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