Episode 30: Imagine
All 50 states have certified their electoral votes for the presidential election. President Trump and the GOP have now lost or withdrawn more than 50 post-election lawsuits and emerged victorious in one. (The only win struck down an extended deadline the Pennsylvania Secretary of State set for voters to cure mail-in ballots that were missing proof of identification and only affected a small number of mail-in votes.) The Texas Attorney General, Ken Paxton, filed a lawsuit this week claiming Pennsylvania, Georgia, Michigan, and Wisconsin violated the Constitution by counting invalid ballots. The suit is requesting the Supreme Court force all four states to throw out every vote cast and appoint electors who support Trump. Yesterday, 106 of the 196 House Republicans signed their names to the brief sent to the Court to support the lawsuit. There are 17 Republican AGs who filed a supporting brief for Paxton’s suit. There is bi-partisan concern that this lawsuit represents a violation of federalism because it would allow one state to police another state’s voting procedures. Last month, news surfaced that Paxton is under investigation by the FBI for bribery and abuses of power of the office after several staff members reported him to federal authorities. Insiders believe that the Paxton’s lawsuit may be a nod to Trump in exchange for a pardon before leaving office.
Meanwhile, President-elect Joe Biden is busy putting together his administration. Biden has named many advisers and Cabinet officials as Inauguration Day draws closer.
Key White House Staff
Ron Klain, Chief of Staff
Jen O’Malley Dillon, Deputy Chief of Staff
Jake Sullivan, National Security Advisor
Neera Tanden, Director, Office of Management & Budget
Mike Donilon, Senior Adviser to the President
Dana Remus, Counsel to the President
Kate Bedingfield, Communications Director
Jen Psaki, Press Secretary
Economic Policy
Janet Yellen, Secretary of Treasury (confirmation needed)
Adewale Adeyemo, Deputy Secretary of Treasury (confirmation needed)
Cecilla Rouse, Council of Economic Advisors (confirmation needed)
Susan Rice, Domestic Policy Council.
National Security
Antony Blinken, Secretary of State (confirmation needed)
Lloyd Austin, Secretary of Defense (confirmation needed)
Alejandro Mayorkas, Secretary of Homeland Secretary (confirmation needed)
Avril Haines, Director of National Intelligence (confirmation needed)
John Kerry, Special Presidential Envoy for Climate
Linda Thomas-Greenfield, Ambassador to the United Nations (confirmation needed)
CIA Director, TBD (confirmation needed)
Other
Xavier Becerra, Secretary of Health and Human Services (confirmation needed)
Tom Vilsack, Secretary of Agriculture, TBD (confirmation needed)
Marcia Fudge, Secretary of Housing and Urban Development, TBD (confirmation needed)
Dr. Rochelle Walensky, Director for Disease Control Prevention (confirmation needed)
Dr. Vivek Murthy, Surgeon General (confirmation needed)
Attorney General, TBD—but departing Alabama Senator Doug Jones is reportedly the favorite (confirmation needed)
Secretary of Labor, TBD (confirmation needed)
Secretary of Transportation, TBD (confirmation needed)
Administrator, EPA, TBD (confirmation needed)
Secretary of the Interior (confirmation needed)
Secretary of Energy (confirmation needed)
Secretary of Veterans Affairs (confirmation needed)
Secretary of Education (confirmation needed)
The US is now averaging about the same number of COVID-related deaths per day as April (around 2,200). The country hit a tragic milestone of more than 3,000 deaths in a single day on Wednesday. CDC Director Robert Redfield warned that single day COVID death totals for the next 60-90 days would exceed the 2,996 death toll recorded on 9/11. In LA County, which is under a stay-at-home order, hospitalizations have tripled over the past month, and fatalities increased by 258%. These stats put an exclamation point on the urgency to distribute an effective vaccine. The UK administered the first COVID vaccine this week, and two people suffered an adverse reaction to the vaccine, but both suffered from severe allergies. The first 800,000 doses will go to people over 80, along with nursing home workers. The UK government is targeting more than 25 million people, or about 40% of the population, in the first phase of its vaccination program. Buckingham Palace refused to comment on reports that Queen Elizabeth II, 94, and her 99-year-old husband, Prince Phillip, would be vaccinated. UK Health Secretary, Matt Hancock, quipped, “this is a day to remember, in a year to forget!”
In the US, a panel of outside advisers to the FDA recommended yesterday in a 17-4 vote with one abstention that the agency authorizes the vaccine created by Pfizer and BioNTeh for emergency use. The Pfizer vaccine has proven 95% effective for anyone over 16, works equally well on men and women and different ethnic groups, and those with underlying health conditions. White House chief of staff Mark Meadows told FDA Commissioner Dr. Stephen Hahn he needed to approve both viruses by the end of the day or resign. President Trump tweeted derogatory comments about the FDA this afternoon. Once approved by the FDA, within 24 hours, trucks will distribute 2.9 million doses of the vaccine across the country. It’s up to the states to decide who gets the vaccine first, and some states disagree on who classifies as an essential worker. President-elect Biden has pledged 100 million vaccinations within the first 100 days of his administration.
The financial markets are experiencing an IPO craze. Here is a list of IPOs this year, and charts show that this year is starting to look a lot like 1999. The Dot Com bubble burst in April of 2000. Meal delivery service, DoorDash, and AirBnB both went public this week. AirBnB closed 113% above its IPO price and valued at $82 billion, while DoorDash closed 86% higher than its debut and valued at $55 billion. The Renaissance Global IPO Index, which tracks the offerings worldwide, is up 82% this year, compared with a 12% gain for an all-country equity index.
While the stock market rampages on, the economy is showing signs of slowing down. Unemployment claims jumped sharply last week. The Labor Department said 853,000 people filed new claims for state unemployment benefits, a sharp increase of 137,000 from the previous week. Claims for a federal program for gig workers and the self-employed, who ordinarily are not eligible for unemployment relief, also jumped by 48%. Together, the claims suggest nearly 1.3 million people were out of work last week. The jobs report disappointed with just 245,000 jobs created in November, down from 610,000 in October. The housing rental market is also showing troubling signs, with 11.4 million households behind on rent. A federal eviction moratorium expires this month, and Americans could owe $70 billion (or $6,000 each) in back-rent, fees, and utility bills once the suspension fades. Still, US household net worth hit a record and grew $1.23 trillion driven by soaring real estate and stock market portfolios, highlighting that the economic recovery has disproportionately benefited wealthier Americans. Many Americans’ worsening conditions come as critical programs passed by Congress in the spring expire at the end of the year, impacting more than 13 million people. Congress has negotiated a deal for a new coronavirus relief package much of the fall, with Nancy Pelosi turning down a $1.8 trillion package before the election. There is currently a $908 billion bipartisan proposal on the table, but Senate Majority Leader Mitch McConnell indicated yesterday that GOP senators would likely not support the plan. They favor a smaller package of around $500 billion.
The Federal Trade Commission and 48 states filed two separate lawsuits against Facebook for widespread antitrust violations. The probe that led to the case touched on everything from Facebook’s handling of user data to its competition-squashing acquire-or-copy business practices. Google is facing a similar antitrust suit from the Department of Justice. Of course, the litmus test for monopolistic behavior is whether the company’s behavior has hurt consumers. Google has skirted monopoly claims because it has argued that it continues to offer a better solution for consumers. However, the problem remains about personal data use, and the reality is there is no suitable alternative. Regulators want Facebook split into three entities—Facebook, WhatsApp, and Instagram. Facebook points out that the government had a chance to object to its purchase of WhatsApp and Instagram. Regulators point out that the now-defunct Google+ appeared to be an emerging competitor at the time. If the case goes to trial, the FTC will have to explain what has changed in the last eight years to warrant action.
EU member countries have agreed to cut carbon emissions by 55% from 1990 levels by 2030. Poland, the Czech Republic, and Hungary largely depend on coal to produce electricity. They will be allowed to build nuclear and natural gas plants to replace coal-burning thermal plants under the deal. The UK, which leaves the EU by the end of the year, aims to cut emissions by 68% by 2030.
The Minneapolis city council has approved a plan to cut police funding by $8 million and use the money for other services. The department had funding for 874 officers at the beginning of this year, but the headcount fell by 166, in part because some officers have taken long-term medical leave, citing post-traumatic stress disorder due to the unrest that followed the death of George Floyd. Minneapolis is facing a crime wave this year. Homicides are up 50% over last year. The number of shootings, carjackings, and robberies has also increased considerably. Shocker.
Uber sold its autonomous vehicle business to Aurora Innovations, a Bay Area start-up founded by the former head engineer of Google’s self-driving car project. As part of the deal, Uber will invest $400 million in the company, and CEO Dara Khosrowshahi will join the Board. The pandemic has been tough on Uber’s business and financials. The company has never had a profitable quarter. The CEO has advocated selling the money-losing parts of the business in pursuit of profitability. Uber recently sold its air taxi division to a CA-based start-up called Joby Aviation.
The following three stories belong together. Time magazine has chosen US President-elect Joe Biden and Vice President-elect Kamala Harris as its 2020 “Person of the Year.” It’s a head-scratcher award, given Biden/Harris has yet to do anything other than run for office. However, it’s not exactly a surprise, as selecting a president-elect for Person of the Year is a nearly nine-decade-old tradition at the magazine. The first president-elect named “Man of the Year” was Franklin Delano Roosevelt in 1932 for his New Deal plan to bring America out of the Great Depression. Ben & Jerry’s launched an ice-cream flavor to celebrate Colin Kaepernick, who was sidelined from the NFL after kneeling during the national anthem. The “Change the Whirled” vegan ice cream is a combination of caramel, non-diary sunflower butter, and fudge chips with graham crackers and chocolate cookies. Apple launched AirPods Max, over-the-ear headphones, for a whopping $550. Plus, you will need to spend another $35 for a lightning cable to use the headphones on planes. By comparison, the entry-level iPhone 11 is $15 cheaper.
Goya Foods CEO Bob Unanue selected Congresswoman Alexandria Ocasio-Cortez as “employee of the month” after she called for a boycott against the company, and a spike in sales of 1,000% followed. Goya has publicly supported President Trump, a fact that irritated AOC. Shortly afterward, Trump tweeted, “I love @GoyaFoods” with a picture of him in the Oval Office with Goya brands such as beans and spices on his desk. Ivanka Trump also took to social media and posted, “if it’s Goya, it has to be good.” AOC responded in Spanish, “if it’s Trump, it has to be corrupt.”
Google released its top trending searches of 2020. News: 1) Election results 2) coronavirus 3) stimulus checks; People: 1) Joe Biden 2) Kim Jong Un 3) Kamala Harris; TV shows: 1) Tiger King 2) Cobra Kai 3) Ozark; How to make: 1) Hand Sanitizer 2) a face mask with fabric 3) whipped coffee; Why 1) were chainsaws invented 2) is there is a coin shortage 3) was George Floyd arrested; Where is 1) my stimulus money 2) my refunds 3) Kansas City; How to 1) cut men’s hair at home 2) plop hair 3) color hair at home.
I. Below are the articles I found interesting the past week:
How John Lennon was made into a myth
Yes, your boss can fire you if you refuse to get a COVID vaccine
The death of Zappo’s Tony Hsieh: a spiral of alcohol, drugs and extreme behavior
II. Stats that made me go WOW!
- Most people in developing countries will be left out of early COVID vaccination efforts because more prosperous nations have signed distribution deals. According to the People’s Vaccine Alliance, wealthier countries that are home to 14% of the world’s population have secured 53% of the most promising vaccines.
- A 1979 Wayne Gretzky rookie card sold for a record $1.29 million at an auction this we, setting a new record for a hockey card.
- Howard Stern signed a new 5-year deal with SiriusXM that will pay him north of $100 million per year. It’s a shocking figure, but Credit Suisse analyst Brian Russo estimated that 15% of Stern listeners could cancel their SiriusXM subscriptions if he left the company, implying a potential subscriber loss of 2.7 million.
Bob Dylan sold his entire catalog of 600+ songs to Universal Music Publishing for more than $300 million. Dylan has sold more than 125 million records globally and the first songwriter to win the Nobel Prize for Literature. After almost two decades of a downward spiral, the music business has enjoyed three consecutive years of double-digit growth. For this reason, financial groups such as Morgan Stanley and PE firms like Shamrock Capital are investing in music. Fleetwood Mac singer Stevie Nicks just sold a majority stake in her songwriting catalog, valued at around $100 million.
In a sign of the times, only 23% of employers plan to hold holiday celebrations. Some are opting for online social events. I would say that fewer company holiday parties mean less sexual harassment and inappropriate behavior this holiday season, but Jeffrey Toobin demonstrates nothing is impossible in 2020.
- A girl was born in Tennessee from an embryo frozen for 27 years.
III. Name that Tune!
As I write this email, I am listening to Imagine by John Lennon.
This week marked the 40th anniversary of the murder of John Lennon. The acclaimed songwriter and The Beatles' front-man has now been deceased for as long as he lived. A 25-year-old former security guard, Mark David Chapman, shot Lennon four times in the back with hollow-point bullets from a .38 special revolver, one piercing his aorta and killing him. Chapman said he was inspired by the character Holden Caufield in JD Slazingers Cather in the Rye. He was a Beatles fan, but his support turned to rage when Lennon commented that the "Beatles were more popular than Jesus. " After the shooting, Chapman remained at the scene reading The Catcher in the Rye until arrested. Chapman pleaded guilty to murdering Lennon and was given a sentence of 20-years-to-life imprisonment in an Upstate New York prison. He has been denied parole 11 times since becoming eligible in 2000.
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