Breakingviews

BREAKINGVIEWS

Fed chief makes case for non-partisan high ground

1 December 2020

Jay Powell testified in the Senate with Treasury Secretary Steven Mnuchin. Lawmakers from both parties tried to pull him into their battles but he stuck to his script. Mnuchin played nice too. Detaching monetary policy from politics is an increasingly fraught but worthwhile task.

Biden’s diverse cabinet is only a first step

1 December 2020

Janet Yellen may be the first woman to lead Treasury in a cabinet that better reflects America. The government has a sad record on that front. The next task is to tackle related challenges like women leaving the workforce, financial inclusion and income inequality.

Will ICE let another big fish wriggle away?

1 December 2020

The $59 bln stock exchange operator watched LSE grab Refinitiv, and now stands on the sidelines as S&P gobbles up IHS Markit. It has proven to be a disciplined deal-doer, and IHS is relatively expensive. Still the companies could fit, and ICE may be tempted to jump in.

VW boss dilemma is about more than Herbert Diess

1 December 2020

The $90 bln carmaker’s CEO wants a contract extension beyond 2023. Diess is gaffe-prone but has the right strategy for moving to electric vehicles and extracting efficiencies. His contract debate is a proxy for whether VW’s board can face down unions trying to muddle that shift.

Airbnb IPO price deserves more stars than DoorDash

1 December 2020

The two are seeking similar IPO valuations: up to $30 bln for the home-sharing app and $27 bln for the delivery firm. That doesn't compute. Airbnb’s scale and proven cash-generating ability are more appealing. Moreover, the pandemic’s end will boost Airbnb and hurt DoorDash.

Regulatory loophole lets SPAC outlooks fly for now

1 December 2020

Some firms listing shares via blank check vehicles do so with ambitious projections. That may be partly because an SEC technicality offers legal protection. Public disclosures are sufficient to give investors fair warning. But the advantage over traditional IPOs may not last.

Credit Suisse wins latest bank boss musical chairs

1 December 2020

The group hired Lloyds’ António Horta-Osório as its next chairman. Perennial CEO contender Jean Pierre Mustier will soon be up for grabs after leaving UniCredit. Passing around talent works for those who woo top names, but smacks of an industry struggling to bring in fresh blood.

Philip Green’s retail roulette hits the little guy

1 December 2020

The Monaco-based tycoon’s Arcadia empire has collapsed. His decision to pay wife Tina a 1 bln pound dividend took chips off the table, but left the Topshop owner poorly placed for the internet. With pensioners and small suppliers on the hook it’s a stark lesson in moral hazard.

Meituan delivers food slathered in EV spice

1 December 2020

The $220 bln Chinese food delivery group saw earnings rise 374% in the third quarter, mostly thanks to an equity stake in an electric car maker. Blistering portfolio gains only emphasize the bland performance of Meituan’s core business – and its expensive share price.

China’s lengthening lowball list lures lawyers

1 December 2020

A bid to take $4.8 bln China Biologic private is the latest underpriced offer for a U.S.-listed Chinese firm. Cayman Islands’ dockets are filling up with shareholder complaints about similar deals. Miring transactions in lawsuits may force acquirers to pay more up front.

CEO sudden exit leaves UniCredit exposed

30 November 2020

Jean Pierre Mustier is resigning from Italy’s second biggest bank after clashing with the board over M&A. He succeeded in cleaning up the lender but did not restore it to growth. His successor faces a tricky merger with Monte Paschi even as the bank is losing ground at home.

GM takes weak middle road with banged-up Nikola

30 November 2020

The $65 billion automaker says it will sell its fuel-cell tech to the troubled zero-emissions-truck company, but has shelved plans to take an equity stake. Cutting ties or doubling down with Nikola, whose value halved since early September, would have been bolder choices.

Salesforce is on back foot in Microsoft WFH battle

30 November 2020

Marc Benioff’s company may buy $24 billion profitless Slack to bolster its software offerings. Shareholders may give Salesforce the benefit of the dealmaking doubt. But its relatively smaller size makes building its portfolio harder and buying much more important.

Corona Capital: Bitcoin, Lonely Planet

1 December 2020

Concise views on the pandemic’s corporate and financial fallout: Bitcoin hit a record, buoyed by inflationary fears, new fans and plain old speculation. Meanwhile Lonely Planet has found a new owner, as it wrestles with an anything-but-lonely market for travel information.

Podcasts

The Exchange: Eating worms is good for the planet

1 December 2020

Growing global demand for food is putting a squeeze on available land and one French startup says it has the answer: indoor insect farming. Ynsect co-founder Antoine Hubert on how growing mealworms for fertilizer will benefit the environment – and eventually our diets too.

Columns

Cox: Swiss firms get too global for local britches

27 November 2020

From ABB to Zurich, corporations extended their reach in ways that brought outsized pride and prosperity. Now a referendum might make them liable for human rights abuses abroad. Whatever the result, it’s a useful reminder companies need to avoid losing sight of their local roots.

Features

March’s market bailout demands regulatory payback

23 November 2020

Central banks were right to prop up financial markets when the pandemic caused panic. But their support exposed structural flaws and may lead to future recklessness. Preventing that requires regulators to extend their reach. Compared to 2008, the reforms are less obvious.