Politics

Corona Capital: Marijuana

5 June 2020

Concise views on the pandemic’s corporate and financial fallout: Cannabis retailers in California miss out on pandemic surge in vices.

U.S. response to Hong Kong calls for precision

5 June 2020

Politicians want to swat China for ramming through draconian security laws in the restless city. The likely targets are Chinese banks. Starving them of dollars is a harsh option but risks collateral damage to foreign firms. Naming and shaming individuals is smarter and cheaper.

The “Trump option” still has value for U.S. CEOs

4 June 2020

Corporate chiefs who left White House councils in 2017 are speaking up again over racial injustice. Their ability to challenge the president is constrained, since they still need help on trade and other issues. The value of being inside the tent, though, is less than it was.

HSBC Hong Kong tightrope walk comes with huge fall

4 June 2020

The $102 bln bank publicly backed a Chinese security law opposed by many of the city’s residents. HSBC has little choice but to toe Beijing’s line. But the risks to its Hong Kong business, and of being caught in the China-U.S. stand-off, will continue to weigh on its shares.

UK’s Hong Kong stance is so far mostly spin

4 June 2020

Prime Minister Boris Johnson says he is offering 3 million residents of the former colony a possible route to citizenship. For now the tweaks to the visa regime look limited and vague. That's a missed opportunity for a post-Brexit economic boost as well as for righting a wrong.

Corona Capital: Crisis loans, Jet fighting

3 June 2020

Concise views on the pandemic’s corporate and financial fallout: Bank customers are no longer making a dash for cash, loan drawdowns suggest. Meanwhile, a U.S. block on Chinese passenger flights suggests domestic battles haven’t dimmed President Trump’s desire to make China pay.

War for Hong Kong talent is Taiwan’s to lose

3 June 2020

The island’s proximity and cultural similarity should appeal to Hong Kongers fleeing Beijing’s crackdown. For its part, the $600 bln economy needs to plug a severe labour shortage and boost investment. But warm political gestures could be offset by bad immigration policies.

UK’s small-firm debt pile is ripe for forgiveness

1 June 2020

Companies have borrowed $23 billion in state sponsored “Bounce Back” loans. Many will probably default. Pursuing debtors will be politically awkward and dent growth. Better to link repayments to financial health or grant relief to companies that hire back furloughed workers.

Germany’s car bonus scheme is only half the trip

1 June 2020

Chancellor Angela Merkel is mooting 5 bln euros in auto subsidies. A similar plan saved jobs at Volkswagen and Daimler in 2009. But the incentives would cover 2 mln vehicles – barely half last year’s sales. If the pandemic has permanently dented demand, a bigger boost is needed.

Corona Capital: Tech diversity, CNN’s middle age

1 June 2020

Concise views on the pandemic’s corporate and financial fallout: As big U.S. technology companies’ CEOs speak out about racial inequality, working from home trends could give them a chance to make a real difference; and 24/7 news network CNN feasts on Covid-19 as it turns 40.

Protests may be last straw for U.S. global stature

1 June 2020

Unrest over police brutality has spread across America, even as President Trump ditches treaties and condemns China’s crackdown in Hong Kong. Such isolationism and hypocrisy dismays allies. It will be difficult to reclaim the moral high ground, and losing it comes at a high cost.

SpaceX mans up in private planetary race

31 May 2020

Elon Musk’s reusable rockets have slashed the price of sending cargo into orbit, but his private $36 bln firm has yet to show that lower costs unleash untapped demand. Successfully launching humans delivers additional cash and political capital to chase bigger dreams.

Review: MMT lives up to some of its promises

29 May 2020

“The Deficit Myth” clearly explains why governments should aim to balance the economy, not the budget. Stephanie Kelton’s book comes at a good time, as huge deficits will help limit the pandemic’s damage. Unfortunately, Modern Monetary Theory suffers from narrowness and naivete.

Irish eyes keep smiling despite a strict lockdown

29 May 2020

Village pubs are shut until August. The Emerald Isle’s restrictions may look extreme but have kept deaths low even if unemployment has soared to near 30%. Yet with ample supplies and a clear reopening plan, Matt Damon isn’t alone in finding Ireland an ideal pandemic bolthole.

China can live with a less special Hong Kong

28 May 2020

The entrepôt's unique autonomy brought prosperity without Beijing having to cede control of the economy and people. Hong Kong’s importance has dwindled, however, and may even be holding China back. A U.S. move to strip its special status only shows how disposable that status is.

Twitter can’t please everyone but still has to try

28 May 2020

Fact-checking a President Trump tweet has put founder Jack Dorsey in a political spotlight he had previously avoided. A spring clean of tweets is good for business in the long term. But unlike peers, Dorsey needs to please shorter-term investors too, like activist fund Elliott.

TikTok’s best move is a clean break from ByteDance

28 May 2020

The video app’s Chinese parent is shifting power away from the People’s Republic. That’s unlikely to win over American lawmakers suspicious TikTok will collect consumer data and send it back to Beijing. ByteDance’s most realistic political option is to sell its rising star.

Viewsroom: Hong Kong crunch

28 May 2020

U.S. Secretary of State Mike Pompeo declared the Asian financial hub no longer autonomous from China, days after Beijing unveiled plans to ban sedition and subversion there. Breakingviews columnists in the city untangle what it means amid the trade war, pandemic and protests.

Corona Capital: GE cash burn, Macy’s lifeline

28 May 2020

Concise views on the pandemic’s corporate and financial fallout: General Electric’s cash flow will be more negative than expected as Covid-19 damages its aviation and power businesses; and U.S. department-store chain Macy’s borrows more, buying time but not much else.

Hong Kong financiers face Man Group’s terror

28 May 2020

During China’s 2015 crash, police detained the China chief of the British hedge fund and others; some state media blamed foreigners for sabotaging markets. Beijing’s proposed new security law will extend this attitude to Hong Kong. Bankers should worry as much as protesters.