Macro Links Mar 30th – Token Overload
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MACRO LINKS TABLE OF CONTENTS (Click or Scroll Down)
- TECH SELLOFF, TESLA, AMAZON, FACEBOOK
- SPY POISONING FALLOUT
- BITCOIN, CRYPTOCURRENCY, INITIAL COIN OFFERINGS
- TRADE, PROTECTIONISM, REGULATION, OVERSIGHT
- GUN CONTROL, POT BOOM, OPIOIDS, PUBLIC POLICY
- TAXATION, WEALTH HAVENS, INEQUALITY
- RUSSIA MEDDLING, RUSSIA PROBE, TRUMP WORLD
- KOREAN PENINSULA, MIDDLE EAST, NUCLEAR WEAPONS
- INFLATION, RATES, DEBT AND CREDIT, BALANCE SHEETS
- VOLATILITY, BLACK SWANS, LIQUIDITY, TAIL RISKS
- MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS
- CENTRAL BANKS & MONETARY POLICY
- USA ECONOMY DATA, CITIES AND STATES
- GLOBAL ECONOMY, INTERNATIONAL
- POSITIONING, INFLECTION, MARKET CALLS
- COLOR, EARNINGS, SENTIMENT, VALUATIONS
- DEALS, MERGERS, IPOs, LBOs, RESTRUCTURINGS
- REAL ESTATE, HOUSING, REITS, COMMERCIAL
- ENERGY COMPANIES, NOCs, INDUSTRY
- COMMODITIES PRECIOUS METALS
- COMMODITIES AGRICULTURE & SOFTS
- POLLUTION, CLIMATE & ENVIRONMENT
- BREXIT, SCOXIT, LONDON, UK ECONOMY
- GEOPOLITICS, CRIME, TERRORISM
- PRIVACY, HACKING, CYBERWAR, SURVEILLANCE STATE
- ELECTORAL POLITICS
- SCANDALS, LAWSUITS, FINES, REGULATORY
- SILICON VALLEY, UNICORNS, STARTUPS, VC
- CLOUD, IOT, SEMICONDUCTORS, ENTERPRISE / SAAS
- AUTOS, ELECTRIC, SELF-DRIVING
- SCIENCE, NATURE, PSYCHOLOGY
TECH SELLOFF, TESLA, AMAZON, FACEBOOK
It is hard for the rest of the market to make up for the losses among the fashionable stocks. Many of the trendy tech companies command extremely high valuations, so even if their underlying business were to be won back by traditional companies, the lower multiple of profits investors assign to old-line stocks should mean a lower overall valuation for the market, and so a lower S&P.
This was the quarter when investors were reminded that stocks don’t go up forever. The euphoria that carried the market higher and higher last year came to an end during the first months of 2018. It was an extremely turbulent quarter that featured two 1,000-point Dow plunges, powerful rallies and a growing list of fears for investors. Despite a 309-point jump on Thursday, the Dow lost more than 2% over the three months. That snaps a nine-quarter win streak, the longest in 20 years, and marks the Dow’s worst performance since 2015. (Markets are closed on Friday for Good Friday.)
China’s walled off tech universe isn’t offering its biggest companies much protection from the global equity rout. The so-called BAT block of Baidu Inc., Alibaba Group Holding Ltd. and Tencent Holdings Ltd. have seen their combined market value fall by $141 billion from this year’s highs as a selloff in U.S. peers spreads across the globe.
In a pair of internal memos last week, the heads of engineering and production spelled out measures to free up workers for the Model 3 line and challenged them to reach production goals. Doug Field, the engineering chief, told staff that if they can exceed 300 Model 3s a day, it would be an “incredible victory” at a time when short-sellers and critics are increasingly doubting the company’s ability to fulfill CEO Elon Musk’s vision of building a mass-production electric-vehicle manufacturer. “I find that personally insulting, and you should too,” Field wrote in the March 23 email. “Let’s make them regret ever betting against us. You will prove a bunch of haters wrong.”
When a company consumes nearly a billion in cash each month, it needs to constantly tap the debt and equity markets. If the share price goes up, access to these markets goes up and cost of capital goes down. When it goes in reverse, it can often be a rapid descent—especially if investors lose hope that the losses will ever stop. I believe that Tesla is now at that inflection point. In many ways, the lower the shares go, the worse things will get in terms of access to capital. When a blatant stock promotion ends, the unwind tends to be fast—especially when there’s lots of cash burn and debt. No wonder Musk is so focused on Mars—it may be the only place he can hide from the coming shareholder lawsuits.
Until it can sustainably keep up Model 3 production, investors are right to be anxious. Tesla’s current problem is a simple one to define: It has built a footprint, market cap and balance sheet sized for a mass-market producer of cars, but thus far lacks the crucial element — the cars. Until it fixes that, sustainably, its dependence on external funding will intensify further. Positive cash flow — quarter-in, quarter-out — would render the haters, real or imaginary, largely irrelevant.
The fall in the debt value is particularly worrying as Tesla is still burning billions of dollars of cash a year, making it heavily reliant on access to capital markets. The further the bond price sinks, the harder Tesla will find it to tap debt investors for further funds to cover this cash burn at economic rates. And if the bond price does fall further, the interested observers in the electric car community may want to get to grips with trying to understand its covenants, key terms that stop the companies from taking actions that would be bad for the bondholders.
Tesla Inc. TSLA is voluntarily recalling about 123,000 Model S sedans globally after discovering that certain corroding bolts in cold weather climates could lead to a power-steering failure. The Silicon Valley auto maker on Thursday said the recall, believed to be the company’s largest ever, applies to Model S sedans built before April 2016. Tesla said the issue is known to have involved less than 0.02% of the potentially affected vehicles in the U.S. Tesla has sold about 280,000 total vehicles through the end of last year.
In a Thursday morning tweet, the president took aim at Amazon over the amount of taxes it pays, its use of the U.S. Postal Service and the company’s impact on traditional retailers. It was the latest in a sustained line of attack the president has levied against the online retailer since before his election.
“Trump’s ire towards Amazon is significantly less concerning”; it’d be “difficult for the current administration to materially change the landscape for Amazon… We see some small risk that the President could use the bully pulpit to criticise Amazon, and potentially put up some road blocks for the company, but we see it as far less fragile than Facebook in its situation. We think, for the most part, that it would be difficult for the current administration to materially change the landscape for Amazon.”
A presidential tweet Thursday suggested Amazon Inc. is exploiting the public mail system for its own gain. In fact, the online retailer’s business is helping to keep the U.S. Postal Service viable. The Trump administration and Congress have also been slow to fill senior leadership positions at the Postal Service and to push forward with legislation that could address the service’s financial difficulties.
Over 90 percent of Wall Street analysts covering the company deemed Facebook a “buy” in early February, even though, at $195 a share, its price-to-earnings ratio, a common valuation measure, was a lofty 35. (The average ratio now is about 24; historically, it has been about 15.) It was, as Wall Street pundits like to say, “priced for perfection.” Whatever else can be said about Facebook’s recent tribulations, this much is certain: Its situation is far from perfection.
Facebook said it would roll out a centralized system for its users to control their privacy and security settings in response to an outcry over the way it has handled personal data. The system, which will be introduced to Facebook users globally over the coming weeks, will allow people to change their privacy and security settings from one place rather than having to go to roughly 20 separate sections across the social media platform.
Facebook was informed that the app at the centre of a massive data leak could sell user data to third parties, according to documents seen by the Financial Times, raising fresh questions about how the company protects its users’ data. The social network was sent terms and conditions for the second version of the survey app, which pulled user data that was then leaked to Cambridge Analytica, the data analytics firm. These contradicted Facebook’s own platform policies, according to Chris Wylie, the former Cambridge Analytica employee turned whistleblower.
Facebook Inc.’s reckoning with its data-privacy practices has the company thinking of easy ways to make the site feel safer for users. One early casualty: Acxiom Corp. shares. Acxiom fell as much as 34 percent Thursday, its largest drop since 2001, after Facebook said it will no longer let advertisers use information from third-party data brokers like Acxiom in targeting of ads on its system. The marketing company said the change could cost it up to $25 million in profit in fiscal 2019.
Apple is seeking to capitalise on its conservative approach to using customer data amid the online privacy uproar fuelled by the huge leak of Facebook data to Cambridge Analytica. When asked on an upcoming MSNBC television interview what he would do in Mark Zuckerberg’s present position, chief executive Tim Cook took a swipe at the Facebook founder. “I wouldn’t be in this situation,” he said.
The European Union General Data Protection Regulation (GDPR) enters into force on May 25 and is the biggest shake-up of privacy rules since the birth of the internet. It introduces stiff fines of up to 4 percent of global turnover for companies found to be in breach. Apple users worldwide will see a new data privacy information page when they update the software from Thursday on their iPhones explaining an icon which will appear when an Apple feature collects personal information.
SPY POISONING FALLOUT
The crisis over the poisoning of a former Russian double agent and his daughter has driven tensions between the Kremlin and the West to their highest pitch in decades. The responses raise the prospect of more serious escalations, either public or clandestine. Relations were already rocky over Moscow’s roles in the wars in Syria and Ukraine, its annexation of Crimea, its meddling in elections in the United States and elsewhere, the assassination of Kremlin foes in Russia and abroad, cyberattacks and disinformation campaigns against other countries and what Western officials have described as a broad, largely covert effort to destabilize and discredit liberal democracies.
Russia has expelled 60 US diplomats and closed the St Petersburg consulate in a tit-for-tat response to US action over a spy poisoning case in the UK. Russia’s foreign minister said other countries that expelled Russians could expect a “symmetrical” response. It comes amid a row over the nerve agent attack on a former Russian spy and his daughter in southern England.
Yulia Skripal, who was found poisoned on a park bench in a small English city this month along with her father, the former Russian spy Sergei V. Skripal, is showing improvement and is no longer in critical condition, the hospital that is treating her said on Thursday. The British authorities have blamed Russia for the poisoning, which they say was carried out with a deadly nerve agent developed by Soviet scientists and known as a Novichok.
Police investigating the poisoning of a Russian double agent and his daughter in Salisbury believe the pair may have first come into contact with a military grade nerve agent at the former spy’s home. In a statement released late on Wednesday the UK’s counter terror force said it had identified the highest concentration of the lethal substance Novichok on the front door of Sergei Skripal’s home.
If Europe came into conflict with Russia, only several thousand of the more than one million troops in its armies would be ready for rapid deployment, military planners fear. The U.S. now wants to step up readiness and ensure that at least 30,000 troops, plus additional aircraft and naval ships, can reach a trouble spot within 30 days of NATO commanders putting forces on alert, current and former allied officials say.
For years, anticorruption campaigners have railed against Britain’s openness to ill-gotten riches from overseas and the foreigners who invest them. After a nerve agent attack on British soil, and the resulting diplomatic showdown between Russia and the West, that may be starting to change. The British government said this week that it would review the cases of 700 Russians who were granted visas to live in Britain largely because they could invest millions of dollars in the country. And it signaled an openness to cutting off access to British financial markets for President Vladimir V. Putin’s government in Russia.
BITCOIN, CRYPTOCURRENCY, INITIAL COIN OFFERINGS
The number of different tokens in existence is debatable, with estimates ranging from a couple of thousand to over 80,000. All that can be agreed on is it’s a lot, and the number is mushrooming with every passing month. Coinmarketcap lists over 1,500 coins and tokens, there’s another 12,000 that have launched on the Waves platform plus more than 68,000 tokens that exist on Ethereum. Most of these latter tokens haven’t launched, but their mere creation via smart contract is enough to sow confusion. There are 20 ERC20 variants of the petro alone.
A more accurate representation of cryptocurrency ownership and cryptocurrency sentiments in America would have been if Finder weighted the data according to the age, race, sex, education, and geography demographics in the Census Bureau’s American Community Survey. A joint survey by Global Blockchain Business and Survey Monkey used the weighting scheme mentioned above in a research conducted in January 2018 and were able to produce statistics regarding the cryptocurrency ownership and sentiments of the American Population with a +/- two percent margin of error. The joint survey polled 5,761 adults in America and found that only five percent own cryptocurrency, 21 percent of those polled were “considering adding cryptocurrency to their portfolios,” and 58 percent of the cryptocurrency holders were white males under the age of 34.
Two Turkish imams have been fired for possessing bitcoin investments, according to local media reports. Turkey’s religious authorities determined that bitcoin is “not compatible with Islam” in November 2017. According to a rough translation, Mecit C has pled only to have made investments into “blockchain,” stating “I do not have a close relationship with Bitcoin, I have not invested a penny, I do not have a connection […] I have an investment in ‘Blockchain’, but I have never invested in Bitcoin, it is a legitimate investment.”
Almost half of the more than 400 institutional allocators, such as pensions, sovereign wealth funds and family offices, surveyed at a Context Summits conference in Miami said they don’t know what to make of cryptocurrencies. Twenty-seven percent of the respondents consider them to be a legitimate asset class, while 26 percent think they’re a fraud. Eleven percent of those surveyed at the industry conference said they plan to allocate to crypto funds this year. Seventy-one percent said they won’t, and 18 percent were undecided.
Bitcoin’s miserable quarter isn’t over yet. The world’s biggest cryptocurrency by market value dropped as much as 10 percent on Thursday, pushing it toward the $7,000 mark and the lowest level on a closing basis since early February, according to data compiled by Bloomberg. The slide took the token’s losses in 2018 to a whopping 50 percent, and other digital assets, including rivals Ripple and Litecoin, slumped more.
Settlement experts in Switzerland, who are familiar with the matter, say that Bitfinex will be incorporated as a public limited company on a move from the British Virgin Islands to Switzerland and will therefore be spun off from the previous parent company, iFinex. The current management team, headed by Dutchman van der Velde, plans to settle in Switzerland as well. Both the legal and financial departments, as well as the technical department would then operate from Switzerland in future.
Coinprism was arguably ahead of its time. By using the bitcoin blockchain to create tokens representing other assets, its colored coins presaged the rise of ethereum and other networks built explicitly for such use cases. But as founder and chief executive Flavien Charlon pointed out in an email to CoinDesk, much has changed since 2014, both on the tech and regulatory fronts. “While we have been one of the first in the area of blockchain tokens, long before ethereum was even released, the ecosystem has since shifted towards ERC-20, which is more flexible and more powerful than bitcoin-based systems,” he wrote, adding: “The unpredictability of transactions fees and confirmation times in the past couple of years have also made it hard to argue bitcoin is a good platform for this.”
Canadian lending institution Bank of Montreal (BMO) banned its customers from using accounts to transact with cryptocurrency merchants in a move seemingly confirmed March 28. A screenshot uploaded to Reddit by an employee seemingly shows a staff bulletin announcing the bank would “block” all credit, debit and online payments to cryptocurrency exchanges. The reason, the bulletin claims, is “volatility.” “Effective immediately, BMO will be blocking cryptocurrency merchant transactions,” it reads. “This decision was made due to the volatile nature of cryptocurrencies, and to better protect the security of our clients and the bank.”
Speaking to Business Insider two weeks after the startup announced it had raised $40mln in new funding since October, CEO Bill Barhydt said western institutional money would begin to “dip its toes” into crypto assets in 2018. In doing so, Barhydt continues a popular narrative that institutional investors ‘waiting’ for an opportune moment will transform Bitcoin and major altcoin price performance.
Bitfinex has announced that it will not list or transact Venezuela’s new “oil-backed cryptocurrency” or any other tokens that the country may issue in the future, citing U.S. sanctions. Meanwhile, the Venezuelan government has reportedly set the minimum investment amount for the petro initial coin offering.
A blockchain company, a battery-metal explorer and a pot grower are among 13 Canadian companies being flagged by OTC Markets Group under a new system to warn investors about stock promotions. “Anonymous, paid stock promotion should have no place in the public markets,” R. Cromwell Coulson, chief executive officer of OTC Markets Group, which lists 10,000 companies on its exchange, said in a statement Wednesday.
The Australian tax agency described how it wants citizens to record their digital asset transactions and document AUD amount at the time of each transaction. The ATO’s “Seeking Input” letter details its recently defined descriptions “resulted in queries from the community about how to approach specific tax events.”
China’s central bank has said cryptocurrencies will be one of its top priorities this year, in an effort to protect the national currency. According to an announcement Thursday, People’s Bank of China (PBoC) has outlined its agenda for the coming year during a conference call focused on monetary development. While Fan Yifei, the vice governor of the PBoC, praised the ongoing progress on central bank digital currency research and development, he highlighted that one of the three priorities for 2018 will be ensuring the integrity of Chinese yuan.
Email distribution company MailChimp will bar marketing campaigns for cryptocurrencies and initial coin offerings starting next month. In an email sent to a MailChimp customer and obtained by CoinDesk, the company said that it will no longer allow its service to be used for crypto campaigns because they are “too frequently associated with scams, fraud, phishing, and potentially misleading business practices.”
Tech giant Intel is seeking to patent a hardware “accelerator” for bitcoin mining chips, a newly-published filing reveals. The application for a “Bitcoin Mining Hardware Accelerator With Optimized Message Digest and Message Scheduler Datapath” was published on Thursday, though it was originally submitted to the U.S. Patent and Trademark Office (USPTO) in September 2016. In the filing, Intel outlines a method by which it could augment the existing bitcoin mining process, consuming less electricity – thereby spending less money – in the process.
The government of Liechtenstein will introduce new legislation to regulate Blockchain business models and underlying Blockchain systems, Prime Minister Adrian Hasler announced during a speech at the Finance Forum in Vaduz, Cointelegraph auf Deutsch reported March 28. The bill will be presented in summer 2018 and is drafted so that business models based on Blockchain technology are integrated in a manner which provides legal and regulatory certainty for businesses and customers alike.
Privacy coins are meant to be private. That’s their raison d’être. Strip away the privacy, and they simply become altcoins, and dangerous ones at that, with the potential to deanonymize their users and expose their secrets. A number of recent reports have cast doubt on the privacy features offered by coins such as zcash and monero.
South Korean cryptocurrency exchange Youbit has reportedly had its insurance claim denied months after it closed following a debilitating hack. In December, Youbit declared bankruptcy after suffering twin hacks over the course of 2017, including one that officials suspected at the time could be traced to North Korea. The second attack, which Youbit said resulted in the loss of “about 17 percent of total assets,” led to the exchange’s closure.
The donated money will be used to equip more than 30,000 classrooms across all 50 states; “approximately one million students are receiving books, school supplies, technology, field trips, and other resources vital for learning through DonorsChoose.org,” Ripple said in a public statement March 27. According to founder and CEO of DonorsChoose Charles Best, who sent a donation request to Ripple, the move would be “the largest donation of cryptocurrency.”
Football Fans will have the option to pay with bitcoin for their accommodation when they visit Russia for this year’s World Cup. Hotels in Kaliningrad, expecting guests from eight countries, are partnering with a local payment provider to offer the service.
The agency’s Internet Crime Complaint Center (IC3) sounded the alarm about tech support scams in the March 28 notice, stating that it constitutes “a problematic and widespread scam.” In its statement, the center said that consumers submitted roughly 11,000 complaints and claimed losses in excess of $11 million connected to tech support fraud in 2017. According to the FBI warning, cryptocurrency investors are becoming an increasingly more common target for fraudsters, “with individual victim losses often in the thousands of dollars.”
90s action movie star Steven Seagal is no longer the official Brand Ambassador for Bitcoiin. According to an announcement on the project’s website, both Seagal and the founders of the ICO have exited from their roles at Bitcoiin. Seagal had only been announced as the Brand Ambassador for Bitcoiin in late February, but the situation has changed fast since then. Primarily, local financial regulators in various US states have issued warnings or orders against the ICO.
Thailand will impose rules on cryptocurrencies and initial coin offerings from April to bolster investor protection, the military-run nation’s Securities and Exchange Commission said. The regulations are set to be enforced in about three weeks, and Thailand is able to move comparatively quickly on tightening oversight in part because a military administration is in power, the commission’s Secretary General Rapee Sucharitakul said in an interview in Bangkok on Tuesday.
TRADE, PROTECTIONISM, REGULATION, OVERSIGHT
China’s high-tech industries are among sectors poised to gain from a fresh round of tax cuts, just as U.S. President Donald Trump weighs tariffs to penalize them. The value-added tax on manufacturing will be cut to 16 percent from 17 percent starting May 1 while the rate on transportation, construction, and telecommunications services will be lowered to 10 percent from 11 percent, the State Council said in a statement late Wednesday.
GUN CONTROL, POT BOOM, OPIOIDS, PUBLIC POLICY
Hundreds of mourners joined black and Muslim leaders at a church in California’s capital on Thursday for the funeral of Stephon Clark, a black father of two whose shooting death by the police 11 days ago has touched off protests around the country and opened a new rift of public anger about police use of force and treatment of minorities. The approximately 300 people who packed the Bayside of South Sacramento Church were joined by an overflow crowd of some 600 who waited in the midday sun outside. And though they had come to grieve, the anger and tension that have spilled over into NBA basketball games and city council meetings at times simmered beneath the surface.
TAXATION, WEALTH HAVENS, INEQUALIT
The percentage of individuals receiving tax audits declined for the sixth consecutive year in 2017 to reach the lowest level since 2002, further showing the effect of budget cuts at the Internal Revenue Service. The IRS, which has lost nearly one-third of its enforcement staffers since the 2010 peak, audited 0.62% of individual returns in the fiscal year that ended Sept. 30, according to data released Thursday. The audit of about 1 in 160 individual returns in 2017 is down from 1 in 90 in 2010, the peak year in the past decade.
RUSSIA MEDDLING, RUSSIA PROBE, TRUMP WORLD
John Dowd reportedly told the president’s men he would take care of them. A pardon is one thing, offering one is another—and possibly a crime. If President Donald Trump’s lawyer discussed the possibility of pardons with Paul Manafort and Michael Flynn, then it could be a whole new piece of the obstruction of justice investigation into the president.
Investigators probing whether Donald Trump’s presidential campaign colluded with Russia have been questioning witnesses about events at the 2016 Republican National Convention, according to two sources familiar with Special Counsel Robert Mueller’s inquiries.
McCabe’s team unveiled the legal defense fund, hosted on the GoFundMe website, about 2 p.m. By 3:30 p.m., it had raised more than $18,700 toward a $150,000 goal. By just before 7 p.m., it had raised more than $194,000, and the goal had been raised to $250,000.
Schwartz’s claim that Cohen acted on Trump’s behalf without telling him could get Cohen in trouble with the bar if it’s true. It also raises serious questions about the validity of the Stormy Daniels agreement. Questions that Daniels’ lawyer now wants to answer by having both Trump and Cohen testify under oath at depositions. Quite the mess, indeed. This is why people who are facing lawsuits often don’t comment on them in public.
KOREAN PENINSULA, MIDDLE EAST, NUCLEAR WEAPONS
North and South Korea set a date for a meeting between leaders of the two countries, but failed to finalize an agenda for the summit, including whether the North’s nuclear program would be part of the talks. The summit on April 27 would bring a North Korean leader to the South for the first time and be only the third meeting between leaders of the rival states.
President Donald Trump threatened Thursday to delay trade negotiations with South Korea to use them as leverage for reaching a deal with North Korea. Speaking in Richfield, Ohio, Mr. Trump said of renegotiating the U.S.’s trade deal with South Korea: “I may hold it up until after a deal is made with North Korea.…You know why? Because it’s a very strong card.”
INFLATION, RATES, DEBT AND CREDIT, BALANCE SHEETS
The personal consumption expenditures price index excluding food and energy rose 1.6 per cent on the year, the largest increase since April 2017, according to a report from the Bureau of Economic Analysis. While that is well shy of the Fed’s 2 per cent target, the three-month annualised rate of gain is 2.8 per cent, said Michael Feroli of JPMorgan Chase. He predicted that year-on-year figures will continue to push higher in the coming months, taking inflation close to the Fed’s goal.
As state and local officials prepare their budgets, many are finding that decisions have already been made for them by two must-fund line items: Medicaid and public-employee health and retirement costs. The proportion of state and local tax revenues dedicated to these requirements is the highest since the 1960s.
VOLATILITY, BLACK SWANS, LIQUIDITY, TAIL RISKS
While short-term U.S. borrowing costs have surged in recent months, borrowers of dollars abroad are unexpectedly getting some long-delayed relief. Libor, the London interbank offered rate, measures the interest rate at which global banks lend to one another and acts as the benchmark for $200 trillion in financial contracts around the world. The measure hit 2.3% this week, up from 2% at the end of February and 1.7% at the end of 2017, sparking concerns about U.S. financial conditions even as the economy remains strong.
Twitter Inc. bonds are now among $30.6 billion of convertibles that are “out of the money,” meaning the stock is trading below the threshold needed to turn the debt securities into equity, according to data compiled by Bloomberg. As the rally that pushed U.S. technology heavyweights to the sky shows cracks, the possibility of further declines could force even more convertibles into the out-of-the-money club. For firms that relied on cheap funding to fuel growth, that’s a problem. If a company’s shares haven’t hit their conversion price when the bonds come due, investors have to rely on the company to repay the outstanding debt at a potentially inconvenient time — when growth may have stalled and resources to repay debtholders are thin.
Issuance of securities backed by riskier US mortgages roughly doubled in the first quarter from a year earlier, as investors lapped up assets blamed for bringing the global financial system to the brink of collapse a decade ago. Home loans to people with scratches and dents in their credit histories dwindled to almost nothing in the aftermath of the crisis, as litigation-weary lenders retreated to patch up their balance sheets. But over the past couple of years a group of specialist firms has begun to bring the loans back, navigating a dense web of new rules drawn up to protect borrowers and investors in the $9.3tn US home-loan market.
Despite a heightened level of political uncertainty, a potential US-led trade war against China and fraught Brexit negotiations, companies have embarked on an unprecedented number of big acquisitions this year. The value of $5bn-plus deals is more than triple year-ago levels, according to data provider Thomson Reuters. More than half of the $1.2tn worth of acquisitions in the first quarter — the fastest start to a year ever — have been worth in excess of $5bn. The overall level of activity is up more than 67 per cent from a year earlier and about a third ahead of 2007, the previous high-water mark for takeovers.
MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS
The financial crisis and the massive federal response reshaped the world we live in. Though the economy is in one of its longest expansions and stock indexes have hit new highs, many people across the political spectrum complain that the recovery is uneven and the markets’ gains aren’t fairly distributed. The Wall Street Journal takes a look at some of the most eventful aspects of the response and how we got to where we are today.
Trade pacts typically require years of detailed negotiations. The North American Free Trade Agreement needed two years. Creation of the World Trade Organization took eight. The Trump administration wants to remake global trade in a matter of months. To secure agreements quickly, the White House has taken a contentious approach to negotiations not seen in decades, threatening allies and adversaries alike with harsh sanctions like tariffs and quotas. Those tactics have returned a few early concessions from trading partners, including South Korea, whose revised trade agreement was formally announced by the United States on Wednesday. But it remains to be seen how much American workers would benefit from these deals and whether the global trading system can sustain the chaos.
President Donald Trump renewed his long-running assault on Amazon.com Inc. with an early morning tweet Thursday. But what measures can he actually take against the online retail giant? He could push for probes of consumer protection, privacy and antitrust issues. He could also step up his support for allowing states to collect sales tax on third-party purchases from Amazon, or seek to have the Postal Service charge more to deliver packages. And he could thwart Amazon’s aspirations to win a multibillion dollar Pentagon contract for cloud services. Even with those powers, Trump’s ability to act has limits. Inquiries by the Justice Department or the Federal Trade Commission could take years and bear a high burden of proof. The FTC and other enforcement agencies guard their independence, as does the board of governors of the Postal Service. Changes to the tax law would require cooperation from Congress, which just passed a tax overhaul and may have limited appetite to reopen negotiations.
“The analysts are looking at the underlying business and they’re saying, ‘hey there’s nothing wrong with Amazon’s business,’ and they’re absolutely right,” Smead said on Bloomberg TV Thursday. “The problem is at that price, history would argue there’s virtually no chance to succeed over five to 10 years.” Smead said this is what happens when shares reach “extremely” high earnings ratios, anything over 60, and Amazon’s is above 300. He pointed to what happened in the past to other big market names with solid businesses and high earnings ratios: RCA in 1929, The Walt Disney Co. in 1972 and Cisco Systems Inc. in 1999/2000.
Trump’s image, to himself and his fans, is that of alpha male — the dominant primate in the room. Simply by going about his business (and largely ignoring Trump), Bezos refutes that claim. He is a far more admired and influential businessman than Trump and, of course, immeasurably richer. (Bezos doesn’t have to hide his financial records to maintain the appearance of wealth.) Yet he’s the opposite of Trump in nearly every dimension. Start with appearance. Trump, who likes his staff to have the right “look,” would never cast a wiry guy who doesn’t hide his lack of hair as a big-time businessman. How can someone only five-foot-nine intimidate people into submission? In Trumpworld, intimidation, not value-creation, is what business is all about. Bezos also has a sense of humor, often at his own expense, and a famously raucous laugh. Trump is humorless. He certainly doesn’t laugh at himself. Bezos speaks clearly and has amazing message discipline even by the standards of successful CEOs — something that struck me when I first interviewed him way back in 1996. Trump: not so much. Trump grew up rich, went to private schools, and had an undistinguished college career. Bezos grew up middle-class, went to public schools, and knocked the top out of Princeton, graduating with highest honors and Phi Beta Kappa in electrical engineering and computer science. One had a rich father; the other has brains. And then there are their families. Bezos is famously close to his. “They are such a normal, close-knit family, it’s almost abnormal,” a friend told Vogue when the magazine profiled his novelist wife MacKenzie in 2013.
Ask a professional Democrat for his or her opinion on billionaire political donor Tom Steyer, and the answer you often get is a variation of the following: Why would someone with so much money spend it all on a fruitless attempt to impeach Donald Trump? Press them for their thoughts in private, however, and many concede that the man funding a $40 million campaign to get rid of the current president is not just a gifted self-promoter, but is, in fact, building one of the true powerhouse entities within the Democratic ecosystem. Steyer is poised to play a massive role in the midterms and pull the party in the direction of his choosing. He’s also set himself up incredibly well—perhaps better than any other potential aspirant—for a serious presidential bid in 2020.
Cryptocurrencies may seem brand-new and disruptive, but look to the past and it’s clear they can be regulated. Money itself is as old as civilization. It’s taken the form of beads, barley, tobacco, cowrie shells, and even giant stone discs, like the great rai of Yap in the South Pacific. Experience with other kinds of money hints that the volatility in the value of cryptocurrencies may be incurable, something that could be a fatal flaw for their use as a medium of exchange. A lot of the tokens aren’t intended to be used as alternatives to dollars, euros, or yen. They have narrower functions for special-purpose digital companies. People who buy them are betting that the issuing companies will succeed. In other words, as in the case of William Howey’s orange groves, buyers are effectively acquiring a piece of a business. Since it’s substance rather than form that matters, it would seem that these initial coin offerings should be registered as securities and regulated accordingly.
Tax cuts enacted this year will likely increase the U.S. government debt load. Congress’s appetite for more spending and tax cuts is adding to annual budget shortfalls. But the biggest contributor to U.S. deficits and debt—mandatory spending for entitlement programs such as Social Security, Medicare, Medicaid and other income assistance programs—has no politically palatable remedy. Those cost $2.5 trillion in 2017 and are projected to almost double over the next decade to $4.3 trillion, as the U.S. population ages and health-care costs rise.
Britain’s ruling class hasn’t prepared the population for pain from Brexit, notes Alan Finlayson of the University of East Anglia. Any hardship will further dent trust in government. The backlash could be either extreme nationalist or extreme left, while the ruling class whines: “But we never believed the silly idea to start with!”
As environmental concerns drive power companies away from using coal, natural gas has emerged as the nation’s No. 1 power source. Plentiful and relatively inexpensive as a result of the nation’s fracking boom, it has been portrayed as a bridge to an era in which alternative energy would take primacy. But technology and economics have carved a different, shorter pathway that has bypassed the broad need for some fossil-fuel plants. And that has put proponents of natural gas on the defensive.
“Few regions of the world are as fractious and riven by airspace wars as the Middle East,” said Oliver Lamb, managing director of the Ailevon Pacific Aviation Consulting. Airspace closures exact significant costs on the region’s economies (and airlines) as travel takes longer and becomes more expensive due to higher fuel costs. The environment of shrinking access to airspace explains why an inaugural Air India flight from New Delhi to Tel Aviv last week was such a big deal. The new link transits Saudi Arabia and Oman, making it, according to Israel’s Prime Minister Benjamin Netanyahu, a huge “breakthrough” with geopolitical implications.
CENTRAL BANKS & MONETARY POLICY
Philadelphia Fed President Patrick Harker said he expects officials will need to raise short-term interest rates a total of three times this year, up from his earlier projection of two, due to stronger inflation.
USA ECONOMY DATA, CITIES AND STATES
U.S. consumer sentiment held near a 17-year high last week as households grew more upbeat about their finances despite a sell-off in equities tied to concerns about a trade war, the Bloomberg Consumer Comfort Index showed Thursday.
Purchases remained flat in February, despite incomes increasing 0.4 percent
Americans’ incomes increased more than their outlays for the second consecutive month in February, a sign that higher incomes aren’t yet showing up in consumer spending.
America’s low-income earners boosted consumer sentiment to a 14-year high in March, while confidence among the nation’s highest earning workers fell.
Power company FirstEnergy is asking the Trump administration to intervene to keep struggling nuclear and coal-fired power plants running across the Midwest, escalating a fight over which fuels power the nation’s electric grid.
Harvard hit a new low this year—in terms of its acceptance rate.
GLOBAL ECONOMY, INTERNATIONAL
President Emmanuel Macron pledged to spend 1.5 billion euros ($1.9 billion) over the next five years and allow expanded data-sharing to help make France a leader in artificial intelligence.
Saudi Arabia’s stock market will join a major emerging markets index in 2019, in a move that is set to channel billions of dollars in investment into the kingdom ahead of a potential local listing of oil giant Saudi Aramco.
Hong Kong has become more “China-centric,” enabling Singapore to take the lead when multinational companies look to set up their Asian headquarters in the region, according to the country’s Economic Development Board.
Investment rose 4% in Britain in 2017 but many of the decisions preceded Brexit
Five years after a factory collapse killed 1,100 workers in Bangladesh’s worst industrial disaster, organizations representing Western brands say that authorities in the country aren’t ready to go it alone to ensure safety standards are up to scratch.
POSITIONING, INFLECTION, MARKET CALLS
COLOR, EARNINGS, SENTIMENT, VALUATIONS
Shares of Sears Holdings Corp. are on pace for their best weekly performance since June after the April issue of Vanity Fair, published this past weekend, featured an interview with the department store’s CEO Eddie Lampert.
DEALS, MERGERS, IPOs, LBOs, RESTRUCTURINGS
It’s a Terry Duffy classic. After years of expanding CME Group Inc.’s empire through deal-making, the CEO of the world’s largest derivatives market is at it again. In a major merger with Michael Spencer’s NEX Group Plc, Duffy has cemented his place at the very center of the global bond market.
Renault SA and Nissan Motor Co. are in talks to merge, seeking to solidify their two-decade-old alliance under a single stock as an unprecedented shift toward electric and shared cars transforms the industry, people with knowledge of the matter said. A deal would end the current alliance between the companies and marry them as one corporation, said the people, who asked not to be identified as the details aren’t public. Renault currently owns 43 percent of Nissan while the Japanese carmaker has a 15 percent stake in its French counterpart. Carlos Ghosn, the chairman of both companies, is driving the negotiations and would run the combined entity, the people said.
Swiss Re AG jumped after people familiar with the matter said Japan’s SoftBank Group Corp. is edging closer to buying a quarter of the company, valuing the reinsurer at as much as 37 billion francs ($39 billion). Billionaire Masayoshi Son could buttress the finances of his diverse SoftBank empire with steady cashflows from reinsurance through the acquisition. The Tokyo-based group has raised $93 billion out of a planned $100 billion for the world’s biggest private equity pool, while taking stakes in businesses including ride-hailing, chipmaking and office sharing.
It wasn’t clear what terms the companies may be discussing, and there is no guarantee they will strike a deal. If they do, the deal would be big: Humana currently has a market value of about $37 billion. It would be Walmart’s largest deal by far, eclipsing its 1999 acquisition of the U.K.’s Asda Group PLC for $10.8 billion. Walmart, which in addition to being the world’s biggest retailer is also a big drugstore operator, has a market value of about $260 billion.
REAL ESTATE, HOUSING, REITS, COMMERCIAL
A unit of LVMH Moët Hennessy Louis Vuitton paid $110 million for a store on Los Angeles’s ritzy Rodeo Drive, in a sign that values of property in the country’s most fashionable shopping districts haven’t succumbed to the malaise hitting retail real estate.
ENERGY COMPANIES, NOCs, INDUSTRY
British-Dutch oil-and-gas company Shell is on a spree of small but strategic acquisitions in an area oil firms have long avoided: the power sector. Shell is making a bet it can profit from changes to the power market as renewables begin to play a bigger role, combining its large energy-trading division and massive natural-gas supply—the world’s largest from a non-state-backed company—to fill gaps when the sun doesn’t shine or wind doesn’t blow. Eventually, Shell said it could even compete with tech companies, crunching data about how and when customers use electricity to give them a better deal.
COMMODITIES PRECIOUS METALS
Gold bulls are finding 2018 offers plenty of reasons to be cheerful. Bullion’s wrapping up a third quarterly gain, a feat not seen since 2011, and exchange-traded fund holdings are near the highest in a half-decade. Haven demand may also get a boost with foreign-policy hawks in the ascendant in Washington. Gold’s haven qualities have come back in focus this year as President Donald Trump’s administration picks a series of trade fights with friends and foes, and investors fret about equity market wobbles that started on Wall Street and echoed around the world. At the same time, although geopolitical tensions with North Korea may be easing, Trump’s pick of John Bolton as his new national security adviser has spurred speculation of a potentially harder line against Iran.
COMMODITIES AGRICULTURE & SOFTS
Soybean acreage in the U.S. this year will exceed corn plantings for the first time in 35 years, according to a government survey, suggesting American farmers remain undeterred by possible Chinese trade sanctions. Soybeans will cover 89 million acres in 2018, while corn may be planted on 88 million acres, the U.S. Department of Agriculture said Thursday in a report in Washington. Plantings for both will decline from a year ago, with USDA forecasts for each below the lowest prediction in a Bloomberg survey of analysts. The government’s spring-wheat estimate topped all forecasts, with an expected 12.6 million acres, up 15 percent from last year.
The planting estimates are the USDA’s first forecast of the year based on farmer surveys. With seeding a few weeks away in most Midwestern states, price swings and weather can spur changes in the outlook. In February, the agency projected corn and soybeans would each cover 90 million acres.
POLLUTION, CLIMATE & ENVIRONMENT
The Trump administration is expected to launch an effort in coming days to weaken greenhouse gas emissions and fuel economy standards for automobiles, handing a victory to car manufacturers and giving them ammunition to potentially roll back industry standards worldwide. The move — which undercuts one of President Barack Obama’s signature efforts to fight climate change — would also propel the Trump administration toward a courtroom clash with California, which has vowed to stick with the stricter rules even if Washington rolls back federal standards. That fight could end up creating one set of rules for cars sold in California and the 12 states that follow its lead, and weaker rules for the rest of the states, in effect splitting the nation into two markets.
Lebanon’s waste crisis began in 2015 when a huge landfill site closed and government authorities failed to implement a contingency plan in time to replace it; dumping and burning waste on the streets became widespread. The campaign group Human Rights Watch calls it “a national health crisis”. But it’s also forced environmental organisations to find surprising and much-needed solutions in the face of slow political change – and they’re proving that a country that’s only the size of Connecticut might be one of Earth’s best playgrounds for environmental innovation.
BREXIT, SCOXIT, LONDON, UK ECONOMY
British lawmakers opened an investigation into economic crime, citing estimates that more than 4 billion pounds ($5.6 billion) of property in the U.K. has been purchased with “suspicious wealth.” The probe, announced by the House of Commons Treasury Committee on Thursday, will cover everything from money laundering and terrorist financing to the millions of frauds and scams perpetrated against individuals. “Given the threats that face the U.K., the effectiveness of the regimes that we use to protect our financial system from misuse have never been more important,” said Nicky Morgan, the Conservative legislator who chairs the cross-party panel.
There is now one year to go before Brexit day. Yet even as the countdown begins to March 29 2019, the UK and the EU know they have more time — at least the best part of two years — to negotiate precisely what comes next. The gap between the two deadlines is a crucial factor as Brexit talks unfold. A standstill transition, agreed in principle this month, has averted a looming crunch for business. EU law will prevail until the end of 2020.
Prime Minister Theresa May has nine months to define what Brexit will actually mean and she’ll have to do battle on three fronts to get there—in Brussels, in Parliament and with her own Conservative Party. Her priorities are to decide what the future relationship with Europe might look like, solve the intractable puzzle of the Irish border and see off an emboldened campaign for a second referendum. Some of the hardest decisions may have to be kicked down the road.
GEOPOLITICS, CRIME, TERRORISM
On Thursday, grieving families collected their dead after one of the worst prison fires in the country’s history claimed the lives of 68 people. The relatives searched for answers, but also offered a chilling account of what they had learned so far: The fire began after gangs running a party in an overcrowded jail fought with the guards. A hostage was taken; a fire broke out. Dozens perished in the smoke and flames, screaming for help. Yet the pain didn’t end there. Witnesses said that grieving relatives who had come were sprayed with tear gas by security forces who tried to disperse them.
An American military drone strike over the weekend in southern Libya killed a top recruiter and logistics specialist for Al Qaeda’s branch in northwest Africa, the Pentagon said on Wednesday, and a senior military official warned of more attacks on extremists there. The military’s Africa Command said in a statement that the attack killed two militants, one of whom was identified as Musa Abu Dawud, a high-ranking official in Al Qaeda in the Islamic Maghreb, known as AQIM.
China’s largest ever naval manoeuvres in the disputed South China Sea were a routine training exercise, the defence ministry said in its first comments about a deployment of 40 warships carried out this week. The ships included China’s only operational aircraft carrier, the Liaoning, accompanied by dozens of other vessels sailing south of the Chinese island province of Hainan. They were recorded by satellite images first published on Monday. Analysts said the exercises sent a message to western navies to steer clear of the South China Sea. China claims about 85 per cent of the disputed sea and has built a half-dozen artificial islands to buttress its assertion.
A directive from India’s foreign secretary urged officials to discard their invitations, and it was blunt in saying the timing of the events coincided with a “sensitive time” for New Delhi’s relations with Beijing. A series of high-level meetings between Indian and Chinese officials are being billed in India as an attempt to smooth over an increasingly tense relationship.
Prominent human rights lawyer Amal Clooney has joined the legal team representing two Reuters reporters jailed in Myanmar, who are accused of possessing secret government papers, her office said on Thursday.
PRIVACY, HACKING, CYBERWAR, SURVEILLANCE STATE
Airbnb Inc. is making it easier for Chinese authorities to keep track of travelers in the country. The home-sharing company plans to share guest information, including passports and booking dates, directly with the government. This week, it sent an email to hosts declaring it may disclose their information at any time — those with concerns were given a link to deactivate their listing.
Eric H. Holder Jr., the United States attorney general for six years under President Barack Obama, stepped away from public service in 2015 but has since emerged as a bulwark against the Trump administration, taking a leading role in challenging the president’s policies in court and trying to chip away at the Republicans’ grip on state governments. Mr. Holder discussed his efforts to fight Republican gerrymandering, whether Facebook should be regulated and the potential legacy of Mr. Trump’s presidency in a wide-ranging TimesTalks conversation with the reporter Alexander Burns on Wednesday night in New York.
President Abdel Fattah al-Sisi cruised toward a landslide election victory against no real opposition but early results showed a lower turnout than the vote that brought him to power in 2014, despite efforts to get more Egyptians to the polls. The vote this week had long been set to hand Sisi a second term after a crackdown against serious contenders left one challenger, widely dismissed as a dummy candidate. Critics say the contest recalled the kind of vote that kept Arab autocrats in power for decades before the 2011 Arab Spring.
Nicolas Sarkozy is facing trial over allegations of corruption and influence peddling just over a week after the former French president was placed under formal investigation in a separate case related to campaign financing. Mr Sarkozy will face trial over charges that he improperly secured details of an inquiry into his 2007 election campaign, according to judicial sources. The escalation was first reported by French newspaper Le Monde. Mr Sarkozy’s lawyers — who could not be immediately be reached for comment — have said he will appeal against the decision to send him to court, according to Reuters.
Ireland will vote this spring in a referendum on whether to overturn a constitutional abortion ban, a decision that comes as the country has moved away from the conservatism of a church tarnished by a sex abuse scandal and other controversies.
SCANDALS, LAWSUITS, FINES, REGULATORY
Barclays has agreed to pay $2bn to settle claims it mis-sold residential mortgage-backed securities before the financial crisis, winning a gamble by the British bank that it could negotiate a lower penalty by standing up to US authorities. The US Department of Justice said on Thursday that the investment banking arm of Barclays had “caused billions of dollars in losses to investors” by misleading them about the quality of mortgages in 36 RMBS deals worth $31bn.
A former JPMorgan Securities LLC broker sued the company, claiming he was threatened and terminated in order to punish him for cooperating in a federal investigation involving a high-profile fund manager who was a “prized depositor.”
A law firm hired by the family of an Arizona woman who died after being struck by a self-driving Uber Technologies Inc. vehicle said Thursday the issue “has been resolved.” The Uber vehicle, which was in self-driving mode but had a human operator behind the wheel, hit 49-year-old Elaine Herzberg while she was walking her bike outside of a crosswalk March 18, Tempe police said. She ultimately died from her injuries.
Bumble, the popular dating app, and Match Group, which owns another popular dating app, Tinder, are in the midst of a messy, public divorce — and the two sides never even got married to begin with. The latest: Bumble filed a lawsuit late Wednesday claiming Match Group, which tried to buy Bumble late last year, interfered with its business operations, and is asking for $400 million in damages.
SILICON VALLEY, UNICORNS, STARTUPS, VC
Open Door Labs, which buys and resells houses, is in talks with investors to raise at least $200 million at a roughly $2 billion valuation, a deal that would help it purchase more homes and expand to new cities, according to people familiar with the company.
CLOUD, IOT, SEMICONDUCTORS, ENTERPRISE / SAAS
Microsoft is moving its Windows franchise from the center of its operations, reorganizing its business around its growing Azure cloud-computing operations and its stalwart Office productivity business.
Microsoft Corp. Chief Executive Officer Satya Nadella unveiled the company’s biggest reorganization in three years, combining the divisions that focus on devices and software for businesses while moving the Windows operating system unit into the cloud operations.
AUTOS, ELECTRIC, SELF-DRIVING
SF Motors has become the latest Chinese-owned company to unveil plans to break into the US electric vehicle market, at a time when a growing tech threat from China has rattled Washington. The push by China’s EV companies comes in the face of US unease about Chinese leadership in the next big technology markets. That contributed to the White House’s decision last week to impose higher tariffs on some Chinese imports, and to threaten retaliation over the pressure American companies have faced to give up their technology to their Chinese counterparts.
The diesel cheating scandal nearly ended the company. Now it’s the No. 1 car seller on the planet, with staggering electric goals. The company is in a much better position than was imaginable not long ago. Its leaders are even daring to suggest that the diesel crisis may ultimately prove to have been a good thing, at least from their perspective: a trauma that forced Volkswagen to ask hard questions about its operations and strategy and what a carmaker will need to look like to survive the 21st century.
Volkswagen has taken parking lots to a whole new level in the United States and will not be emptying them soon. Volkswagen AG has paid more than $7.4 billion to buy back about 350,000 U.S. diesel vehicles through mid-February, a recent court filing shows. The German automaker has been storing hundreds of thousands of vehicles around the United States for months.
SCIENCE, NATURE, HISTORY, PSYCHOLOGY
The successor to Kepler is here. This planet-hunter, a 700-pound spacecraft called the Transiting Exoplanet Survey Satellite (TESS), is scheduled to launch next month and focus on stars nearer and brighter than those analyzed by Kepler. TESS will operate in a unique elliptical orbit, synchronized with the moon, to aim its four sophisticated cameras at roughly 200,000 stars. The mission is to detect brief decreases in brightness caused by a planet cutting across a star. In this orbit, the TESS spacecraft will remain stable for decades.
In an article entitled “It is an honor to be called a revolutionary,” La Repubblica editor Eugenio Scalfari acknowledged the pontiff’s previous remarks about how “good souls” who sought repentance from God would receive it and then asked: “What about the bad souls?”. Seemingly going against centuries of core Christian belief, Pope Francis said the souls of sinners simply vanished after death, and were not subject to an eternity of punishment.
This might be the most scrutinized season of Harper’s career, of the life he believes he was born to lead, the one that affords him far fewer choices than it might seem. He will be a free agent after this season, one of a handful of Hall of Fame-type talents available to the highest bidder. For years, those emotionally invested in Harper’s future have analyzed every word, hunting for some insight into where he might go. All winter, most of those organizations who might financially invest in his future eschewed spending, leading some to wonder exactly what kind of market will exist for his services. All season, others will remind him much is at stake with every swing.
Antarctic scientists discovered the hole in the ozone layer, along with ice cores that shed new light on the planet’s climate history. Yet for most of the 20th century, Antarctica was widely thought to be frozen in time. Not any more. Parts of the continent are changing fast, including sections of the massive ice sheet that covers it. This holds so much water that if it ever melted completely, global sea levels would rise by nearly 60m. This will not happen any time soon, but even small losses would affect coastal cities and islands around the world, as well as some of the most iconic polar creatures. The race to understand Antarctica has become more urgent, even as conditions on the continent remain as forbidding as ever.
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