The Economist - 2 March 2024

Год выпуска: March 2024

Автор: The Economist Newspaper and The Economist Group

Жанр: Экономика/Политика

Издательство: «The Economist Newspaper Ltd»

Формат: PDF (журнал на английском языке)

Качество: OCR

Количество страниц: 80

HOW HIGH CAN MARKETS GO?

• Stocks are at all-time highs. But a golden age for equities is drawing to a close: leader, page 9, and analysis, page 61.

Fentanyl: why the epidemic will worsen

• It cannot be defeated without new tactics: leader, page 11.
• America's ten-year-old opioid crisis is far from over: briefing, page 15.

China's diaspora: no escape

• Living outside the country has become more like living inside it, page 35.

India's north-south divide

• Political and economic divisions could ruin India. Overcoming them could be the making of it: leader, page 10.
• Can the Bharatiya Janata Party woo the country's richer, better-educated states? Page 31.

A plan for Russia's frozen assets

• How to put them to work for Ukraine: leader, page 12, and Free exchange, page 67.

The world this week Politics

• Donald Trump’s march towards the Republican presidential nomination reached Michigan, where he won the party’s primary with 68% of the vote. Mr Trump had earlier beaten Nikki Haley in her home state of South Carolina. She has vowed to continue her campaign. Meanwhile the Supreme Court said it would hear arguments about whether Mr Trump is immune from prosecution in the week beginning April 22nd. Prosecutors seeking to try the former president had hoped for an earlier hearing. The court will rule soon on a separate case about whether Mr Trump can be kicked off the ballot. That matter has gained a sense of urgency after a judge in Illinois decided to remove him from the state's primary ballot.
• Around 13% of voters in Michigan’s Democratic primary voted for “uncommitted", a protest against Joe Biden’s support for Israel from leftwing Democrats. Nearly 3% of the vital swing-state’s electorate is Muslim.

Into the sunset

• Mitch McConnell announced that he would step down as the Republicans’ leader in the Senate after the election in November. He has held the role since 2007, but had a few health scares recently. Mr McConnell has had a poor relationship with Mr Trump.
• Talks continued on a potential temporary ceasefire between Israel and Hamas in Gaza that would be based on the release of Israeli hostagesand Palestinian prisoners during Ramadan, a month of fasting for Muslims. Mr Biden said a deal could be announced within days. Qatar, which is hosting the talks, said it was "hopeful, not necessarily optimistic" Gaza’s health ministry said 30,000 people, mostly women and children, had died in the conflict. It didn’t say how many were Hamas militants.
• Ghana’s parliament passed a law under which people can be jailed for three years if they say they are lesbian, gay, bisexual or transgender. It also criminalises forming or funding lgbt+groups or calling for gay rights. The bill will only come into force when signed by the president.
• Heavy gunfire was reported in Chad’s capital, N’Djamena, after an attack on the headquarters of the country’s security agency. The government blamed an opposition party.
• ECOWAS lifted economic sanctions and border closures imposed on Niger after a coup last year. The change in policy seems to be aimed at dissuading Niger, Burkina Faso and Mali, which all have military governments, from leaving the 15-member west African bloc, ecowas had imposed sanctions to try to force them to restore democratic rule.
• Documents and chat-logs from a private Chinese security firm, I-Soon, were leaked onto a public website. They showed its extensive involvement in government spying on a wide range of targets, including dissidents, foreign governments, businesses and charities. It is unclear how the leak occurred. Meanwhile China passed amendments to its state-secrets law. It includes a new vaguely defined category called "work secrets" the leaking of which could be deemed as a threat to national security.
• New Zealand's new centreright government rescinded a ban on tobacco sales for future generations that would have taken effect in July. The ban would have been the first in the world to phase out
• smoking by prohibiting people born after January ist 2009 from buying tobacco products, even as they grow older. The government thinks this would have created a black market for cigarettes. Instead it will use the revenue it receives from tobacco sales to fund tax cuts.
• Narendra Modi, the prime minister of India, visited Kerala and Tamil Nadu. The tri p was part of a push on behalf of the ruling Bharatiya Janata Party to capture more votes in the south ahead of the forthcoming general election.
• Hun Sen, who was prime minister of Cambodia from 1985 to 2023, returned to an official government position as president of the Senate, who acts as head of state in the king’s absence. Hun Sen’s son, Hun Manet, took over as prime minister when his father relinquished the office.

Hungary for change, at last

• Hungary’s parliament approved Sweden’s application to join nato. Hungary and Turkey were the last members of the military alliance to ratify the bid; Turkey gave its formal approval in late January. "Sweden is leaving 200 years of neutrality and military non-alignment behind,” said the Swedish prime minister, Ulf Kristersson, a shift in security policy that Vladimir Putin never anticipated when he invaded Ukraine.
• Speaking during the weekend of the second anniversary of Russia’s invasion of Ukraine, Volodymyr Zelensky said that 31,000 Ukrainian troops had been killed in the conflict as well as "tens of thousands" of civilians (American estimates of Ukraine's military deaths are far higher). The Ukrainian president urged America to pass a big military’ aid package that Republicans in Congress are blocking within a month. “If we lose, there will be no us," he warned.
• The suggestion by Emmanuel Macron that troops from Western countries could be sent to Ukraine was firmly rebuffed by other European leaders. The French president said that all options should be considered to ensure Russia's defeat. The Kremlin warned that deploying European soldiers would spark a conflict with NATO.
• Supporters of Alexei Navalny were expected to try to attend his burial in Moscow on March ist. The body of the former Russian opposition leader was handed over to his mother, nine days after his death in an Arctic penal colony. The authorities are worried that the funeral could turn into a protest. Meanwhile a court sent Oleg Orlov, a prominent human-rights campaigner, to prison for "repeatedly discrediting" the Russian army.
• The EU received 1.1m applications for asylum last year, an increase of 18% compared with 2022 and the highest number since the migrant crisis of 2015-16. Syrians continued to lodge the most applications; up by 38% over 2022. Afghans were the second-largest group to apply, though their numbers fell from 2022. Applications from Turkish nationals surged by 82%. Germany was the main destination country, receiving 29% of all applications.
• The Odysseus Moon lander, the first commercial spacecraft to touch down successfully on the lunar surface, relayed its first images. Operated by Intuitive Machines, the Odysseus is conducting the first of three missions with NASA. It is America’s first return to the Moon since 1972.

The world this week Business

• Microsoft struck a partnership with Mistral, a French startup working in artificial intelligence, that will help expand its services in cloud computing. Mistral was founded just a year ago by former researchers at Google and Meta. Its large language model is seen as rivalling GPT-4 in terms of reasoning, GPT-4 has been developed by OpenAi, in which Microsoft owns a 49% stake.
• Nvidia’s share price retained most of the gains it made after its quarterly earnings smashed expectations. Its market value surged by $277bn in a day, the most ever for a company. With a market capitalisation nearing $2trn the maker of high-end chips for Ai has become the third-most-valuable American company, after Microsoft and Apple. Nvidia is a rising tide lifting all boats. Thes&p 500 hit a new record, as did the Nikkei 225 in Japan and Stoxx Europe 600.
• By contrast Alphabet, Google’s parent company, lost $8obn in market value in a day amid the controversy over Google’s Gemini. In overcompensating for diversity the ai model has depicted erroneous woke images of historic figures and at times refused to show images of white people. Examples include black Vikings, an Asian Founding Father of America, a female pope and a Native-American British king. Google has withdrawn the tool to make improvements. Sundar Pichai, Google’s boss, told staff that Gemini had "shown bias” which was "wrong”.
• Underlining the shift in market priorities, Apple has reportedly ditched its project to develop an electric car in order to redirect funding towards ai. And heralding a potential shift in the priorities of investors, two big groups of Apple shareholders supported a resolution at its annual general meeting asking the company to disclose its ethical guidelines on ai. The proposal was defeated but was supported by 38% of all shareholders.

Government involvement

• America’s Justice Department hired its first chief ai officer. Jonathan Mayer, a computer scientist and lawyer, will advise the department on law enforcement, regulatory and legal issuesand help develop an in-house team of experts in the technology.
• Japan promised to provide funding for a second factory in the country to be built by TSMC, the world’s biggest chipmaker, TSMC, based in Taiwan, has just opened its first plant in Japan. The Japanese want to bolster their supply chains against possible disruption from China.
• The obituaries came thick and fast for Vice Media, after a leaked memo showed that it plans to stop publishing on its website and cut hundreds of jobs. Founded in the 1990s as a hip journalistic brand, Vice’s digital platform was one of the pioneers challenging established media. But digital sales never lived up to their promise. Vice is now looking to distribute its content through those traditional channels.
• Disney continued to restructure its business in the face of its proxy battle with Nelson Peltz, an activist investor. The company is merging its division in India into a joint venture with Reliance Industries, which will hold a 63% stake in the new entity. Disney took control of the Star tv network, India’s biggest, in 2019, but it is losing money, increasing its operating loss in Disney's latest quarter.
• Berkshire Hathaway, the holding company for Warren Buffett’s investments, reported an annual operating profit of $37-4bn, up by 21% from 2022 and boosted in part by the performance of its insurance business. But the Sage of Omaha warned that there were only a few companies left to invest in that offered the big gains that Berkshire has enjoyed in the past.
• America’s Federal Trade Commission sued to block the $25bn proposed merger of the Kroger and Albertsons supermarket chains, saying the deal would harm workers and lead to higher food prices. Kroger said both it and Albertsons "look forward to litigating this action in court”.
• Macy’s announced the closure of 150 stores, about a third of its total, and will renovate its remaining properties, creating smaller shops located away from malls. Tony Spring took over as the retailer's chief executive in February'.

Timed for lunch?

• Wendy’s, a fast-food chain, denied reports that it would introduce surge pricing for its menu. Surge pricing is used by Uber and other businesses to raise prices when demand increases at any given time, so customers at Wendy's would pay more if there was a surge in demand for its Pretzel Baconators. The company said that instead its new digital menu boards would bring in “dynamic pricing”, which is not surge pricing, it insisted, but allows it to display discounts "particularly in the slower times of day”. New technology is increasingly allowing many businesses to adjust their prices in real time to changes in demand.

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