fortune--2020-08-13--Why this August equities rally is so unusual

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Buongiorno, Bull Sheeters. The August rally has been truly impressive. The S&P 500 has gained ground on all but one trading session this month. Alas, this morning investors have hit pause on equities, with U.S. futures slightly down, and Europe and Asia mixed.
Let’s check in on the action.
Markets update
Asia
The major Asia indexes are mostly higher with Japan’s Nikkei up 1.8% in afternoon trade.
are mostly higher with Japan’s Nikkei up in afternoon trade. Facing a potential U.S. ban, Tencent Holdings, operators of the popular WeChat messaging platform, is trying to placate investors that any impact on the business would be a narrow one. Conversely, any ban could inadvertently hit Apple’s $44 billion China business pretty hard.
messaging platform, is trying to placate investors that any would be a narrow one. Conversely, any ban could inadvertently hit Apple’s $44 billion China business pretty hard. Saudi Aramco has vowed to meet its commitment of paying out $75 billion in dividends this year despite a huge drop-off in revenues and a rising debt pile. Unless crude prices rise significantly, that strategy isn’t a viable one, analysts tell the Financial Times.
Europe
The European bourses sank at the open, with London’s FTSE down 0.9% in the first hour of trade, before falling further.
sank at the open, with down in the first hour of trade, before falling further. The U.S. will hold off—for now—on a threatened tariff hike against the E.U. , a dispute that began 16 years ago over state subsidies to Airbus and has now mushroomed into more than 100 items—from clothes to cheese to whiskey .
will hold off—for now—on a against the , a dispute that began over state subsidies to Airbus and has now mushroomed into more than 100 items—from . Add Russia to the list of those dumping dollars for euros. According to Bloomberg, Russia’s strategy to “de-dollarize” the economy has gone into full swing with the majority of its Russia-China trade, for example, now priced in euros, not dollars.
U.S.
U.S. futures are trading sideways. That’s after yesterday’s big rally, which saw the S&P 500 briefly hit an all-time high with Big Tech’s thoroughbreds—Apple, Microsoft and Amazon—leading the way.
are trading sideways. That’s after yesterday’s big rally, which saw the briefly hit an with Big Tech’s thoroughbreds—Apple, Microsoft and Amazon—leading the way. Can the S&P climb any higher above these pandemic-defying prices? Fortune‘s Shawn Tully runs the numbers, and concludes the future return on big cap stocks is pretty lousy.
above these pandemic-defying prices? Fortune‘s Shawn Tully runs the numbers, and concludes the is pretty lousy. Don’t tell that to Tesla bulls. Shares closed Wednesday 13% higher following the company’s announcement of a 5-for-1 stock split. Never mind that the move is the equivalent of breaking a five-dollar-bill—you don’t get any more value when you ask for five singles. Still, investors keep pouring into the stock expecting huge returns. So far, they haven’t been wrong.
Elsewhere
Gold has had a wild ride this week. It’s down slightly, trading around $1,940/ounce .
has had a wild ride this week. It’s down slightly, trading around . The dollar is down, too.
is down, too. Crude is flat, with Brent trading at $45.20/barrel.
***
The shape of recovery
Now is as good a time as any to check in on the health of the world’s biggest economies. The U.K. yesterday reported dismal Q2 figures, meaning all G7 nations (with the exception of Japan) have now detailed how badly their economies contracted in the lockdown-slammed quarter.
Among the mega economies, China (not part of the G7, of course) actually reported Q2 growth. They were the only ones.
Elsewhere, the U.S. saw a historic economic contraction in the April-June quarter, but it wasn’t nearly as bad as the collapse of economic activity in the Euro zone, or in Britain. Today’s chart details the Q2 carnage:
The good news is that Q2 was probably the nadir for the developed world’s pandemic-inflicted economic collapse. From here, most economists agree, we’re in rebound territory.
But we’ve only just begun calculating the cost of recovery. For example, the U.S. is facing a record budget deficit that will almost certainly top $3 trillion by the close of the fiscal year ending on Sept. 30. That’s more than double the previous record. And there’s a chance—an ever-slimming one—that another trillion-dollar-plus fiscal stimulus package is still in the cards, adding to a groaning debt load.
To get out of the economic crisis, every nation in the chart above will see its dreaded debt/GDP ratio soar. We’ve racked up debts so big that we and our kids will be paying them off for years to come.
Slow growth and rising indebtedness used to be the kind of thing that would put a chill on the markets. Deteriorating public finances, the econ text books tell us, should send yields on sovereign debt higher, rightly suggesting a higher premium be paid for every dollar loaned out. That’s not happening, as you can see with Treasury yields plumbing historic lows.
Inflation expectations are still relatively low and investors are as bullish as ever on tech and health care stocks, which are now seen as a flight to safety. As the August equities rally shows, investors just aren’t all that concerned about the debt sustainability of the world’s biggest economies.
You know what could pop this bubble of euphoria? A bad autumn where the pandemic lingers and spikes, lockdowns are re-instituted, vaccine trials get bogged down, and lawmakers and central bankers begin to fess up that they’re running out of bullets.
Such a scenario may sound overly pessimistic, but investors are indeed concerned about the pandemic. It regularly tops investor sentiment polls as “biggest worry” or “biggest headwind” in Q3 and beyond.
Okay, I don’t want to end on a downer note, so [checks notes]… did you hear the news? Tesla is doing a five-for-one stock split.
***
Have a nice day, everyone. I’ll see you here tomorrow… But first, more news below:
Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com
As always, you can write to bullsheet@fortune.com or reply to this email with suggestions and feedback.
Today's read
Pizza party. Not all pizza's the same. That truth is being exposed during the pandemic. For starters, if you don't have a decent home-delivery business, your pizza business is toast. Fortune's Brooke Henderson does a deep-dive into America's biggest pizza chains and reveals why some of these stocks—hint: Domino's Pizza—are soaring above the rest of the pack.
Media mogul. The life and career of Sumner Redstone was worthy of a movie. It's a story full of heated boardroom clashes, bold M&A deals, romance and betrayal, and, yes, a daring escape from a hotel fire. Redstone, whose family now has a sizable stake in ViacomCBS passed away on Tuesday at the age of 97. His obituary is one for the ages.
MPW. One more time... Fortune is collecting nominations for our annual Most Powerful Women lists, which publish in our November issue. We’re accepting submissions through this online form. The deadline for applications is Aug. 24
Some of these stories require a subscription to access. There is a discount offer for our loyal readers if you use this link to sign up. Thank you for supporting our journalism.
Market candy
Running mate
Kamala Harris, Joe Biden's newly named running mate, is one of the highest-earning Democrats in Washington. Fortune's Jen Wieczner breaks down Harris' net worth and finds that "by some measures," Harris has been a bigger earner than even Biden himself. "Politically, Harris has proposed some changes to U.S. tax policy, including taxing stock trades at 0.2% and bond trades at 0.1%—a change that could potentially increase the taxes she pays on her own investment accounts, which include both stock and bond funds," Wieczner writes.


fortune--2020-08-13--Grab CEO Anthony Tan: What Southeast Asia is teaching us about a post-pandemic world

My daughter Heather Heyer ’ s death taught me how to grieve .
We all need to know how today

One of my fondest memories as a little boy was going to Klang (a town in Malaysia where my parents are from) every weekend and eating bak kut teh (pork rib soup) with my parents at a famous local joint. The glorious soft-bone pork rib was my favorite, and I would dunk deep-fried dough fritters in the caramel-colored herbal broth, while enjoying the meat with chili sauce.
The bak kut teh store was a hole-in-the-wall operation run by a family who have cooked pork rib soup for generations. Lines would form early outside the store before lunchtime, and so many people would cram inside the tiny shop, cheek to chopstick, munching on pork ribs. The store relied completely on word-of-mouth marketing to drive foot traffic and sales.
This small food business, like many others across Southeast Asia, suffered greatly when COVID-19 struck. With footfall going to zero and business owners ill-equipped to pivot online, many of these generational small businesses simply folded.
COVID-19 has disrupted our way of life. It has impacted our communities, our businesses, and the global economy. However, COVID-19 has also given us a chance to reevaluate the way we function as societies and economies, pushing us to adapt to a new normal at unprecedented speed—and not for the first time. Crises such as war, political revolutions, and natural disasters have long shaped humanity’s future, catalyzing change and forcing us to rebuild over and over again.
For example, World War II saw the implementation of industrialized assembly lines to build munitions and armaments, changing the outcome of war. In the process, it laid the groundwork for turbocharging the auto industry. COVID-19 is accelerating a similar level change, offering a reset button to struggling businesses and industries that have operated the same way for centuries.
We are now at the end of the beginning. With a widely available vaccine unlikely to be available for some time, some clues about our future have emerged. Social distancing will be the norm for at least the next 12 months, as people live cautiously and in accordance with government guidelines aimed at preventing a second wave of infection. Hygiene and safety will be prioritized. Until then, our reliance on digital services will likely remain elevated.
The digitalization of small business
This new digital order will create several long-term outcomes that will impact the way we work, eat, run businesses, and pay for everyday staples. I want to highlight one critical development that we will look back on as COVID-19’s legacy: the rapid digitalization of small, traditionally offline businesses, as they transform to survive and meet consumers online.
A survey by Main Street America, a network of more than 1,600 commercial districts, noted that nearly 7.5 million small businesses in the U.S. are at risk of permanently closing their doors over the next several months if COVID-19 persists.
In Southeast Asia, home to us at Grab, the problem hits harder, as 90% of the region’s economy consists of small businesses. In Indonesia, hundreds of thousands of warungs, small street-side stores peddling street food and necessities, have seen their sales plummet because of the pandemic. Singapore, with its gleaming skyline, has not been spared; the country’s prized street-food culture, driven by cash transactions and dine-ins, has also been severely hit by movement restrictions.
A vendor arranges fresh fish at her stall in the Yio Chu Kang market in Singapore on July 2, 2020. Roslan Rahman—AFP/Getty Images
The region’s mom-and-pop stores are what make it unique. But these stores have been operating on an offline model for generations. It comes as no surprise that many SMEs in Southeast Asia have therefore struggled to go online, even if it has become a necessity for keeping their business afloat.
This was the case even prior to the pandemic, where a 2018 Bain survey found that just 15% of SMEs in Southeast Asia truly utilize digital tools, despite 75% seeing digital integration as an opportunity.
This lack of digital literacy is a hurdle. Technology companies, aware of this gap, have tried to ease the transition for small businesses. In May, Facebook launched its Shops service, allowing businesses to set up an integrated online store accessible via both Facebook and Instagram.
Lessons from Southeast Asia’s wet markets
This struggle has always captured my attention, as I believe it’s what truly holds Southeast Asia’s diverse countries and people back from realizing their full economic potential. This reality has compelled us to create meaningful initiatives to address the gaps.
In March, we announced an initiative to bring wet markets online through Grab’s app. A traditionally offline shopping experience, the service allows users to now order wet market produce online and have delivery-riders fulfill those orders.
In Kuala Lumpur, bustling Taman Tun Dr. Ismail (TTDI) has one of the most popular wet markets in the country. Before the pandemic, you would find it packed with stalls brimming with fresh cuts of meat, leafy greens, and tropical fruits, and customers jostling to get their picks. Wet markets like TTDI never had to go online, because everything—from their supply chain to a steady stream of customers—was purely offline.
However, the mobility restrictions and social distancing measures now in place have slowed foot traffic drastically, representing a serious threat to this traditional ecosystem. For the businesses that have relied on this wet market model to support their families for generations, getting online was an important way to not only survive the pandemic but also thrive in a post-pandemic world.
Al Hafiz, who hawked ulam (a type of traditional vegetable and fruit salad) at TTDI for more than 20 years, saw his business crash when the pandemic hit. We helped him with his transition, equipping him with the tools and insights to kick-start his online journey. Listing on our wet market platform in March, before social distancing orders kicked in, he was able to keep up a flow of remote orders and have them fulfilled by delivery-riders. Like many others, going online saved his business.
Similarly, in Singapore, we launched a three-month pilot to bring street-food vendors online. We extended to them significantly reduced commission rates and helped them access more income opportunities with a wider base of customers via the Grab app. We use our scale and data-driven insights to give these small businesses the boost they need.
Rural commerce is also an often overlooked area in Southeast Asia. In sunny Ambon, an island in eastern Indonesia, fishermen labor to sell heaving nets of fresh fish to restaurants and locals daily. When the pandemic hit, their income was immediately choked as restaurants shuttered and movement restrictions went into effect. Adopting this same approach, we onboarded them into our GrabMart service to help list and promote Ambon fishermen’s catch of the day digitally—helping them unlock new streams of customers in Jakarta.
Customers in protective face masks shop for groceries at a traditional “wet market” in Kuala Lumpur, Malaysia. Syaiful Redzuan—Anadolu Agency/Getty Images
While the social aspect of shopping at wet markets with our loved ones or visiting our favorite mom-and-pop store may be missed for now, going digital could be what ensures the survival of these traditional business ecosystems for future generations. We have to work together with nongovernmental organizations and governments to ensure small businesses, like Al Hafiz’s ulam stall in the TTDI market, are trained in using these digital economy tools in order to navigate and thrive in this brave new world.
The fact is that life may never be the same as what we knew pre-COVID, but in Southeast Asia, businesses and the people behind them are hardy. We will adapt to changes in our external environment just as our ancestors did before us and thrive in this new age.
Anthony Tan is the group CEO of Grab.


fortune--2020-08-13--U.S. and China are working together to crack the case of the mystery seeds

There’s at least one area of cooperation between U.S. and China: those mystery seeds.
According to a broadcast released by the United States Department of Agriculture on Wednesday, officials from both China and the U.S. are working together in order to uncover the origin of thousands of seed packets that have been shipped from China to unsuspecting homes in the U.S. The USDA says it knows the names of some of the companies sending seeds, but needs China’s help tracking them down.
“We don’t know the background information about these companies, and that’s why we’re working with our counterparts in China to follow up on some of these senders,” Osama El-Lissy, deputy administrator for the USDA’s Animal and Plant Health Inspection Service (APHIS), said on Wednesday.
The seeds began appearing in mailboxes in the U.S. and several other countries as early as two months ago. The USDA warned receivers of the unsolicited seeds not to plant them, in case they introduced an invasive species of plant or contained bugs that could be harmful to the local biosphere. Recipients were instructed to either destroy the seeds or post them to the USDA for inspection.
Early this month, APHIS announced it had identified 14 species of seeds from among the thousands sent out to American homes. The seeds were mostly from common plants such as sage, rosemary, hibiscus, and roses. El-Lissy says the USDA has so far identified just two seeds from potentially harmful weeds as well as one lava of a common leaf beetle.
“That’s the extent of our findings, so far…Other than that, we have not found anything alarming,” said El-Lissy, who is experienced in snuffing out invasive crop pests. As director of the Texas boll weevil eradication program from 1994 through to 2000, El-Lissy led one of the largest pest eradication programs in the world. But APHIS’s mundane findings so far support the organization’s early theory that the unsolicited seed shipments were nothing more than a “brushing scam.”
Brushing is when sellers on an online marketplace, such as Amazon, falsify sales data in order to achieve higher ratings. Sending out cheap products, such as seeds, to unsuspecting customers can help boost a merchant’s sale numbers.
The U.S., like many countries, has restrictions on seed imports, because the goods can be harmful to the local ecosystem. The USDA says it is working with its counterpart in China, the Ministry of Agriculture and Rural Affairs, as well as China Post in order to “stop future shipments” of seeds.


fortune--2020-08-13--Federal agents tricked Hamas into sending Bitcoin to Uncle Sam

Everything we know so far about the second round of stimulus checks

Criminals have long seen cryptocurrencies like Bitcoin as a stealthy way to transfer money. But in an unusual sting operation, federal agents not only infiltrated a terrorist group’s Bitcoin operation, but tricked its supporters into sending the digital currency to the U.S. government.
On Thursday the Justice Department revealed details of the sting, which was part of a sprawling investigation into the financial operations of three global terrorist organizations: Islamic State, Al-Qaeda, and Hamas.
The investigation involved the seizure of hundreds of cryptocurrency accounts containing more than $1 million, as well as four Facebook pages that the Islamic State was using to sell phony personal protective equipment.
According to the Justice Department, all three terrorist organizations have been encouraging supporters to send them cryptocurrency. This encouragement included propaganda like the Hamas poster shown below. (The poster was included in the Department’s release; we’ve added circles to show the Bitcoin solicitation.)
In the course of the investigation into Hamas’ military wing, known as the Al-Qassam Brigades, federal agents seized one of the group’s websites, located at alqassam.net. The U.S. then began covertly operating the site and pocketing the Bitcoin donations it received.
“During that covert operation, the website received funds from persons seeking to provide material support to the terrorist organization, however, they instead donated the funds [to] bitcoin wallets controlled by the United States,” the Justice Department statement reads.
Even though people can send and receive Bitcoin in semi-anonymous fashion, every transaction is recorded on a public ledger known as the blockchain. By tracing those public transactions, speciality firms like Chainalysis—which assisted the FBI with its investigation—can often guess who controls a given wallet containing illicit Bitcoin.
The Justice Department says proceeds from selling the Bitcoin it confiscated will be distributed to victims of terrorism.
More must-read finance coverage from Fortune:


fortune--2020-08-13--Stimulus checks and extra unemployment benefits unlikely until September as Senate goes on recess

On Thursday Senate Majority Leader Mitch McConnell adjourned the chamber for recess until September 8.
That move comes as Democratic and Republican leaders remain deadlocked in their negations for a broad stimulus, which would include extended enhanced unemployment benefits and a second round of $1,200 stimulus checks. While McConnell said he’d bring senators back if a deal materializes, the move is the latest sign things aren’t progressing.
Last week Senate minority leader Chuck Schumer offered to come down from $3.4 trillion to $2.4 trillion, if Republicans came up $1 trillion to $2 trillion. That way, “we could begin to meet in the middle,” he said. Republican rejected that offer, and hours later Trump announced his executive orders and memorandums. Since then, the two parties have yet to negotiate again.
The White House reached out to restart negations with Democratic leaders on Wednesday, but that was rejected. On Thursday House Speaker Nancy Pelosi told reporters they won’t resume negations with Republicans until they come up to at least $2 trillion in coronavirus aid. Republicans still favor a $1 trillion price tag.
Differences between the parties remain on issues like funding for state and local governments (Democrats want more than a $1 trillion for it), and school funding (Republicans want more going to schools that open in-person). And Democrats still oppose a Republican proposal to provide COVID-19 lawsuit immunity to businesses and schools. However, both parties are in agreement about another round of $1,200 stimulus checks.


fortune--2020-08-13--It’s time for hospitals become more active in their communities

Good afternoon, readers.
Hospitals are seen, sometimes literally, as saviors within their communities. To treat the afflicted is no minor responsibility. But their reach can—and should—extend well beyond treating the patients that arrive at a hospital’s doorsteps.
That was the takeaway I got from a conversation with experts such as Kyu Rhee of IBM Watson Health, Dr. Josh Sharfstein and Dr. Rachel Thornton of Johns Hopkins, Barbie Robinson, the director of health services in Sonoma County, CA, and Dr. Jack Westfall, director of the Robert Graham Center, during a panel discussion with Fortune this morning.
To put things in context: Hospitals are largely judged on metrics such as how many patients are readmitted before being released. Those metrics can dictate their rankings on “Best Hospital” lists.
But that alone can’t explain a hospital’s capabilities or explain the progress that has to be made. All of our panelists this morning emphasized that a hospital needs to be more than a triage center—it needs to be an active participant in the community on issues such as environmental sustainability, food security, mental health services, and actively engaging the populations that they serve.
In short: It’s not enough to just be a brick and mortar building that treats those who are already sick, you need to actually do the groundwork to make sure that people don’t get sick in the first place.
We’ll have more on this, because it’s a critical discussion. But suffice to say I’m glad we had this one.
Read on for the day’s news.
Sy Mukherjee
sayak.mukherjee@fortune.com
@the_sy_guy
DIGITAL HEALTH
Maven creates digital health tool for sending kids back to school. Maven Health began as a women's digital health company. So it speaks to a host of societal issues that the company felt compelled to develop an app about giving parents information on whether or not they should or should not send their kids to school. The COVID-19 Child Care Decision program gives users a quiz to assess risk. The suggestions which come out aren't binding, but rather meant to provide some semblance of advice when political leaders have been giving people wildly divergent suggestions. (MobiHealthNews)
INDICATIONS
U.S. government, Moderna strike deal for 100 million coronavirus vaccine doses. The Trump administration has struck a $1.5 billion deal with Moderna, the upstart biotech with one of more advanced COVID vaccines, in order to secure 100 million doses of the drug if and when approved. The vaccine gold rush around coronavirus has both raised hopes about the industry—and concerns that a hasty effort could lead to ineffective treatments. It's still unclear just how effective Moderna's, or any of its competitor's, vaccine candidates will ultimately prove in the long run. (CNN)
THE BIG PICTURE
Biden says all Americans should wear masks when outside for the next 3 months. Presumptive Democratic presidential nominee Joe Biden, who named California Sen. Kamala Harris as his running mate this week, doubled down on the necessity of wearing masks in public during a speech on Thursday. "Every single American should be wearing a mask when they're outside for the next three months, at a minimum," he said. "Every governor should mandate mandatory mask-wearing. The estimates by the experts are it will save over 40,000 lives." Masks have become a strangely politicized issue, but the science is pretty clear—a virus which spreads through the air can be held back via the use of masks. And the issue isn't so much about one's own personal protection as it is the safety of all others. (NPR)
REQUIRED READING
How Livongo reached its historic megamerger, by Sy Mukherjee
A blueprint for redesigning the office in the pandemic age, by Nicolas Rapp & Brian O'Keefe
Bars are fighting to stay in compliance with their states' regulations, by Brooke Henderson


fortune--2020-08-13--To boost Black communities, support Black-owned banks

Systemic racial injustice has been brought to the forefront across communities and industries, and it requires our attention. Efforts to promote financial inclusion, whether through private sector programs or driven by legislation, have largely fallen short, and economic development continues to stagnate in many communities in the United States, particularly in communities of color.
There is a powerful yet relatively simple solution: Allow minority depository institutions (MDIs) and community development financial institutions (CDFIs) to qualify for Opportunity Zone–type investments.
MDIs are essentially minority-owned banks, which are designated as such by the Federal Deposit Insurance Corporation. A CDFI is a financial institution, usually though not always a nonprofit, certified by the Treasury Department to provide credit and financial services to underserved markets and populations.
The issue with minority access to capital was summarized cogently by James Barth, Aron Betru, Matthew Brigida, and Christopher Lee in their recent report for the Milken Institute:
“The primary source of startup funding for small businesses is savings and equity investments from personal networks, and secondarily, bank loans. However, for minority-owned businesses, the second most prevalent source of funding is credit cards, which is typically a higher-cost product designed to fund short-term liquidity, not catalyze long-term growth. This places minority-owned businesses at a disadvantage and also potentially stymies local economic development. Increasing access to bank lending is an important component of improving the potential of minority-owned small businesses and the communities in which they operate.”
Opportunity Zones were created by the Tax Cuts and Jobs Act of 2017 to encourage investments in lower income areas through the use of tax incentives. Taxes are deferred on capital gains if the funds are reinvested in Opportunity Zones. Additionally, the investments themselves are eligible for tax-free gains if they’re held for 10 years. This program has the transformative power to make many economically distressed communities much more attractive to investors.
Recently, there has been renewed attention on Opportunity Zones. Last month, acting Comptroller of the Currency Brian Brooks, Sen. Tim Scott (R-S.C.), and Secretary of Housing and Urban Development Ben Carson hosted an event to raise awareness for Opportunity Zones and their power to bring much-needed investment capital to underserved communities.
However, under current legislation, MDIs and CDFIs cannot receive Opportunity Zone investments. This exclusion has had a negative impact on the communities the program was designed to help, since local minority-owned banks are more likely to support diverse businesses in disadvantaged neighborhoods.
My colleague and fellow fintech entrepreneur, Christian Duffus, founder and CEO of Fonbnk, was correct when he told me, “Fair, unfettered and unbiased access to financial opportunities is a civil right in a capitalist society.
“Not only do Black Lives Matter, but we cannot forget Black Financial Lives, meaning that financial security is also of the utmost importance to the development of African-Americans’ welfare,” Duffus continued. “It is critical to rectify generations of financial inequity, which has been as brutal as the police violence enacted upon our communities….The proposal gets at the heart of the matter—ending the cycle—by enabling our communities to democratically access Opportunity Zone investments using state-of-the-art financial technology.”
African-American banking isn’t new; it’s been around in various forms since 1860. But Black-owned banks’ efforts to significantly alter the financial landscape for the communities they serve has been hampered by larger societal forces.
In her landmark book, The Color of Money: Black Banks and the Racial Wealth Gap, Mehrsa Baradaran, a professor of law at the University of California, Irvine, writes, “A history of racism institutionalized through slavery, sharecropping, Jim Crow, white affirmative action, redlining, job discrimination and white flight created self-reinforcing cycles of segregation and poverty. These institutions were often violent, extractive and openly condoned, but their lingering effects are quiet, subtle and hard to detect. They are no less destructive.”
Baradaran goes on to conclude:
“The clear message that emerges from the history of black banks is that relying on these banks to do the work of achieving wealth equality without changing the economic environment in which they operate is unfair, cynical and fruitless. Insofar as there is segregation and widespread poverty in the black community, banks that exclusively serve this community cannot be successful.”
Revising the law governing Opportunity Zones to allow investments in MDIs and CDFIs would absolutely change the economic environment in which these institutions operate. A new generation of MDIs would benefit from an inflow of capital (as a result of the movement surrounding social injustice, as well as the capital incentives outlined above) and democratized distribution enabled by digital banking (fintech), for both deposit taking and asset generation. These banks could serve all communities equally well, and thrive.
The recent movements of funds we’ve seen—for example, $100 million moved by Netflix to African-American-owned banks and $1 billion committed by Bank of America to Black-owned businesses—indicate there’s a new willingness to take action to address the legacy of financial inequality. Creating a capital structure such as the one I’ve outlined above would create a banking structure for social justice money to flow to.
There are a number of exciting, new, and capable African-American-owned fintech companies, such as Tenth, MoCaFi, Nivelo, GigWage, and Lilium Capital, which could execute on a new form of MDIs. Having Opportunity Zone, tax-advantaged benefits apply to the capital base of MDIs would create a sea change of capital and investments from all sectors of the investment community, as well as CRA and social justice related funds.
To assist struggling communities to develop and prosper economically, it is essential to increase their access to capital. Revising the law governing Opportunity Zones to allow investments in MDIs and CDFIs is a simple, easy-to-implement solution that would have an immediate impact, translating into much-needed financial support for underserved minority communities.
Clay Wilkes is the CEO of Galileo Financial Technologies.


fortune--2020-08-13--Apple yanks Fortnite from App Store, and the game’s creator sues

Apple removed Fortnite from the App Store on Thursday, prompting a lawsuit by the game’s creator, Epic Games. The moves escalate a dispute between the two companies that had been brewing in recent weeks.
Apple requires applications with in-app payments to be billed through the company, which takes a 30% cut of revenue, similar to Google’s store. On Thursday morning, Epic Games told customers it would begin offering a direct purchase plan for items in the popular battle royale game on both Apple and Google platforms, circumventing the fees. Epic said it would pass on the savings to customers, offering discounts of as much as 20% on its own plan.
Apple said in a statement that it removed Fortnite because Epic took steps with the “express intent of violating the App Store guidelines.” A representative for Epic didn’t immediately respond to a request for comment.
Apple is facing scrutiny from officials in the U.S. and Europe over antitrust complaints. Epic Chief Executive Officer Tim Sweeney has openly supported the European Union’s investigation into Apple’s practices. App developers have complained for years about the fees Apple and Google charge in their stores. Sweeney described the two companies as a duopoly in an interview with Bloomberg Television last month.
“If Apple had the way, they’d block the web and make arbitrary decisions about what pages you’re allowed to visit,” Sweeney wrote on Twitter last month, “and then demand 30% of the revenue from every company that does business on the web.”
Shortly after Fortnite was pulled, the game’s official Twitter account said it would host a new video short called Nineteen Eighty-Fortnite, a cheeky shot at a famous Apple advertising campaign.


fortune--2020-08-13--AMC movie theaters will reopen on Aug. 20 with 15-cent tickets

Moviegoers will have to pay only 15¢ for tickets at AMC cinemas on Aug. 20, when the chain starts to reopen amid the coronavirus outbreak.
The cheap tickets will be available at more than 100 theaters across the U.S. The deal, a throwback to the price the company charged when it was founded in 1920, is intended to lure customers who may be worried about venturing into a theater because of the risk of contracting COVID-19.
“We are thrilled to once again open our doors to American moviegoers who are looking for an opportunity to get out of their houses and apartments and escape into the magic of the movies,” AMC Entertainment CEO Adam Aron said.
AMC and other cinema operators closed their theaters in March when COVID-19 was starting to rapidly spread in the U.S. In June, AMC said in a regulatory filing that the pandemic had taken a serious toll on its business, and that “substantial doubt exists about our ability to continue as a going concern for a reasonable period of time,” the Associated Press reported.
But as the nation slowly reopens, AMC hopes people who are frustrated from the tedium of the current reality will head back to the theater like old times. It expects to have two-thirds of its 600 U.S. theaters opened by Sept. 3., with the remainder opening after getting clearance from local and state officials.
AMC promised to give its theaters extra cleaning and sanitizing because of COVID-19.
AMC Entertainment’s shares were up 17% to $5.42 in midday trading on Thursday following its announcement about reopening.
AMC rival Regal plans to reopen its U.S. facilities on Aug. 21.


fortune--2020-08-13--Another huge unemployment wave is coming—and there’s an obvious way to stop it

Congress must act now, or millions more workers will lose their jobs without a safety net to catch them. Every job we lost has a ripple effect, and all the warning signs for our economy are flashing red.
Since the pandemic began, 55 million Americans have filed for unemployment. That’s not even counting the undocumented workers who are ineligible for benefits or parents—mainly women—who left the workforce to care for their kids.
Without a real relief package, millions more will soon join them, including hundreds of thousands of flight attendants, pilots, baggage handlers, gate agents, and other aviation workers.
So far, almost no aviation workers are out of work, thanks to the Payroll Support Program our unions fought for in the CARES Act. The program stabilized 2.1 million jobs so efficiently that overwhelming bipartisan majorities in both chambers support a clean extension.
But if there’s no relief package, aviation will join the long unemployment lines and our country will lose more of the jobs we support—in manufacturing, hospitality, transportation, and beyond. And the crisis for workers will be even more disastrous.
Many of the 55 million who filed for unemployment have stayed afloat because of the $600 enhanced unemployment benefit Congress included in the CARES Act. But that program ended on July 31, and economists from across the spectrum are warning that we’re headed for disaster unless Congress acts.
Last week, JPMorgan Chase released a study showing the extra $600 propped up and spurred consumer spending, while warning that delays in processing benefits could cause a drop in spending bigger than the 2008 Great Recession and significantly shrink our economy. After talks broke down and the White House issued empty executive orders, JPMorgan followed up its study with another dire warning to Congress that it must act soon.
The National Bureau of Economic Research agrees, saying failure to reach a deal will lead to a 44% drop in local spending. Even if the benefit is reduced to $400, we’d see a steep drop we can’t afford (and for most, Trump’s executive orders will never deliver a single dollar).
And these awful projections might be best-case assessments. The Economic Policy Institute (EPI) shows the spending generated by that extra $600 is supporting 5 million jobs. If the dollars disappear, so will the jobs they support.
Millions of workers can’t make ends meet even with the $600. One in three Americans is behind on housing payments, and 30 million to 40 million people face eviction in the coming months. Without a deal in Congress, those numbers will skyrocket.
It is utter nonsense that enhanced benefits are keeping people out of the workforce. Tens of millions of workers are competing for far fewer jobs than were available just six months ago. For every job available, there are five people looking for work—and those few jobs are now in jeopardy too.
Letting the enhanced benefits lapse is far from the only thing that will cause massive job loss. State and local governments are facing huge shortfalls, and begging Congress for help. Without it, there’s another huge unemployment wave coming.
How big a wave? EPI’s research estimates 5.3 million critical public workers will lose their jobs over the next 18 months without a major federal investment in our state and local governments to keep public transportation going, rural hospitals open, teachers educating, and sanitation workers doing their jobs.
It takes a pretty big crisis to see unions, economists, and corporations calling for the same outcomes. Now add in Federal Reserve Chair Jay Powell, who practically begged Congress to extend the $600 benefit and fill the gaps in state and local budgets.
All of these numbers are predicated on the economy staying about where it is, but that’s no guarantee. As coronavirus case numbers remain staggeringly high, consumer spending is dropping again and businesses that reopened may be forced to close again. Much of the money Congress allotted for the Payroll Protection Program (PPP) is spent and gone, even as millions of small businesses struggle to stay afloat.
If Congress acts to maintain the $600 benefit, provide aid to state and local governments, revamp the PPP, and extend the Payroll Support Program, we can save more than 10 million jobs, while preventing millions of unemployed people from falling into total crisis.
Throw out everything you’ve learned about how the economy works. We’ve never faced a situation like this. The cost of letting our economy go into a free fall is far greater than the cost of protecting jobs and keeping people safe while we fight the COVID-19 pandemic.
As we stand on the precipice of a second Great Depression, we can’t afford to go small. When the virus surges again, more jobs will disappear. Without real relief, there will be nothing to slow our descent this time.
From U.S. Postal Service workers to educators to sanitation workers to bartenders to flight attendants, working people are looking to Congress to take action for our jobs.
I know there’s broad support across parties for reaching a deal today. If Senate Majority Leader Mitch McConnell can agree with Speaker Nancy Pelosi on a relief bill, we can save millions of jobs, fight the coronavirus, and prevent years of suffering. But the time to act is running out.
Sara Nelson is president of the Association of Flight Attendants-CWA and cochair of the Biden-Sanders unity task force on the economy.


fortune--2020-08-13--‘Road of the future’ to link Detroit and Ann Arbor with 40 miles of driverless cars and shuttles

Companies have poured tens of billions into driverless vehicles, but they have yet to change how we get around—we still rely on cars and trucks driven by humans. One reason for this could be that companies have been focusing on the wrong problem: They have put all their efforts into vehicles and not the roads that carry them.
That is set to change thanks an ambitious new project in Michigan that will connect two of the state’s key cities—Detroit and Ann Arbor—with a new corridor dedicated just to autonomous vehicles. The plan is being led by Cavnue, an infrastructure startup, and with the support of traditional car companies like Ford and GM as well as Alphabet’s driverless car subsidiary, Waymo.
A prototype for a driverless car road between Detroit and Ann Arbor. Cavnue
The plan calls for new roads to be built alongside existing routes, including Interstate 94, with links to destinations like the University of Michigan and Detroit Metropolitan airport. The new roads, depicted in the illustration above, will be accessible only to driverless vehicles.
The so-called road of the future, which was announced on Thursday by Michigan Gov. Gretchen Whitmer, amounts to an ambitious bid to reconceive both transportation and public transit. A press release describing the project hailed it as “the world’s most sophisticated roadway.”
A key feature of the plan is the development of a common software standard that will let autonomous vehicles of all sorts—from cars to transport trucks to passenger shuttles—access the road. This provides a revenue opportunity for governments, which can charge private companies for access to the road, using the funds to subsidize transit. For transit users, driverless shuttles could be an affordable new way to get around, as shown in the image below:
It remains to be seen, of course, whether all of this will actually come to fruition. For now, the project calls for an initial 24-month planning phase after which the State of Michigan and startup Cavnue will decide whether to begin construction. Cavnue is a subsidiary of Sidewalk Infrastructure Partners (SIP), a holding company partly backed by Google parent Alphabet.
According to Cavnue, the public sector will not have to finance any of the first phase of the project, and if construction goes forward, the builders will explore a variety of funding options such as federal grants or fares from local businesses along the corridor.
In an interview with Fortune, Cavnue cofounder Jonathan Winer cited a “lot of nervousness” in the public sector over new technology and infrastructure projects. He said this stems from a shortage of funds—exacerbated by the pandemic—as well local governments’ experience with companies like Uber and Airbnb, which have been prone to flouting quality-of-life concerns.
In order to win the support of Michigan and local governments, Winer says Cavnue began by bringing together all manner of transportation interests—including road operators, public sector officials, and carmakers. At a convention in February, the various groups explored how dedicated routes for driverless cars could provide an alternative to light rail and other transit systems.
Winer adds that the occasion also underscored the challenge of finding practical uses for driverless vehicles—a challenge detailed in a recent Financial Times report that described “disillusionment” with the technology and “robotaxi failure.” The idea of “robotaxis” has been hyped for years as a new form of urban transportation, but companies have failed to develop autonomous cars capable of operating in cities.
“The general consensus is it’s harder than we thought,” he said. “If we’re spending billions on tech, we’ll need near-term commercial applications.”
In practice, Winer says, this means shifting the focus of the fledgling autonomous vehicle industry towards projects like the corridor between Detroit and Ann Arbor, which can allow autonomous vehicles to operate without challenges like urban traffic.
The Detroit project is also getting a boost from the traditional titans of Motor City, including Ford’s executive chairman, Bill Ford, who is the great-grandson of the company’s founder.
“Building out a connected corridor cements Michigan as a leader in creating a more connected, autonomous, and electrified future,” said Ford in a statement.
The “road of the future” project will also be a key proving ground for SIP, the holding company that created Cavnue. SIP is a spinoff of Sidewalk Labs, a subsidiary of Google’s parent company Alphabet, which seeks to remake cities with technology—but which has been dogged by privacy controversies and other setbacks.
Winer, who is also co-CEO of SIP, believes the company will be able to avoid Sidewalk’s missteps, in part because it is policy-focused and takes pains to consult public officials at the outset of its projects.
Earlier this year, SIP raised $400 million from Alphabet and investing giant Ontario Teachers’ Pension Plan. Cavnue is the company’s second major investment, coming after SIP’s decision to invest in a plant that aims to solve the problem of recycling plastic.
In addition to advisors from Ford, GM, and Waymo, Cavnue’s advisory board includes members from Argo AI, Arrival, BMW, Honda, Toyota, and TuSimple. The University of Michigan and the City of Detroit are also lending support to the project.


fortune--2020-08-13--Facebook adds voting hub to combat election disinformation

Facebook launched a voting information hub to give users election information, including links to register to vote or volunteer at a local polling station.
The hub, which CEO Mark Zuckerberg first announced in June, will be promoted atop U.S. users’ Facebook and Instagram feeds later this fall. The company expects it will reach 160 million Americans before November’s presidential election, according to Emily Dalton Smith, Facebook’s director of social impact. Facebook will compile information for the site from state officials and groups like the Bipartisan Policy Center and the Federal Voting Assistance Program.
The idea came after Facebook saw value in a similar tool it created to promote accurate information about Covid-19, Dalton Smith said. Facebook has said it’s made protecting the integrity of the 2020 U.S. election its top priority, but the social network is often used to spread misleading information about voting and other election-related topics. Facebook started labeling all posts related to voting last month and those tags will drive users to the election hub. Facebook has publicly touted a goal to help register 4 million people to vote.
The company will also use the hub to share election-day results, Dalton Smith said. But it is already preparing for a scenario in which returns aren’t available immediately given the expectation that many people will vote by mail. Facebook is still finalizing those plans, including which sources it will use for voting results, Dalton Smith said. “It’s a pretty dynamic election season so we’re working on our plans for election night as we speak,” she added.
Alphabet’s Google also announced an initiative on Thursday to distribute accurate voting information and fight efforts to mislead voters about the electoral process. People looking for voting information on Google search will see a special information box with state-by-state information, gathered from local authorities and non-profit groups.
Google also said it will remove any videos from YouTube that contain information that was obtained through hacking and which might interfere with the election or census. In the 2016 election, Wikileaks released thousands of pages of emails from Hillary Clinton’s campaign chair, leading to widespread coverage and sparking new conspiracy theories that still circulate today.
Twitter said on Wednesday that it’s also planning new features and policies that will prioritize accurate voting information as the election draws near.


fortune--2020-08-13--Inside Netflix’s ‘Project Power,’ a ‘refreshing’ take on the popular superhero movie genre

If you’re missing the usual lineup of Marvel and DC movies at theaters this summer, Netflix has another movie about superpowers—albeit with something of a twist—for you.
Project Power, which can be streamed starting Friday, is centered on a pill that enables takers to develop super abilities—though they don’t know what their power is until they’ve ingested it. As the pill causes escalating mayhem, a police officer (Joseph Gordon-Levitt) pairs up with teenage dealer Robin (Dominique Fishback) and a former soldier (Jamie Foxx) to stop the group behind it.
As one would expect, the film is full of special effects—but there’s also an element of reality that made the script appealing to directors Henry Joost and Ariel Schulman (Catfish, Paranormal Activity 3 and 4, Nerve), as well as Fishback.
“The superpowers are presented in a…relatively realistic way,” Joost tells Fortune. “There are these superpowers in this world, but they don’t happen by magic, and they don’t come from alien worlds—they come from a drug that was created by people. And like all drugs, it has really serious side effects. So if your power is to burst into flame, then you’re going to get really badly burnt, and you’re going to be very susceptible to cold after that.”
Jamie Foxx as Art in “Project Power,” which was shot in New Orleans. Locations like the one pictured were incorporated into the script, the filmmakers say. Courtesy of Netflix
Joost and Schulman also appreciated that the story was character-driven and “human,” pointing to Robin in particular as someone who’s “unusual to have in this type of movie.”
Fishback agrees, saying that her character—who’s caught up in a messy situation but also has a loving relationship with her mother, happens to be a talented rapper, and isn’t exactly a “damsel in distress”—jumped out on the pages of the script itself.
“It wasn’t like I was going to have to fight for us to know her background, to know what her dreams are,” Fishback says.
New Orleans, the city where Project Power was shot and takes place, also serves as another character on-screen. The filmmakers scouted various locations before settling on New Orleans and eventually bringing screenwriter Mattson Tomlin there to incorporate the setting into the script.
“We don’t like shooting cities and pretending they’re different cities,” Joost says, adding that they allowed the location to “rewrite” some scenes, including one they shot in an abandoned apartment complex that was repurposed by a local artist as an installation. “You couldn’t write it for that place, because how could you imagine that place? But once we scouted that, we said, ‘How can we tailor this scene for this incredible location?’
“You don’t get that kind of freedom if you’re not shooting in the place where the story takes place,” Joost notes.
Fishback, for her part, also spent some time talking with teenage girls at the New Orleans Center for Creative Arts to make her character feel more authentic. “I went through the whole script and I’m like, ‘How would you say that? Would you use this word? No? Okay, which word would you use?’”
From left: Jamie Foxx as Art and Dominique Fishback as Robin in “Project Power.” Robin jumped out as a fully realized character in the script itself, Fishback says. Skip Bolen—Netflix
There were other small attentions to detail as well. Fishback, who raps on film (and auditioned with Lisa “Left Eye” Lopes’s verses from TLC’s “No Scrubs”), points out that the woman who backs her up with some beatboxing in one scene is Chika, a real-life rapper who wrote Robin’s rhymes.
“It was really clever of [Schulman and Joost] to have that sweet little gem in there, for people who know Chika,” she says. “And then to find out that she’s the one who wrote all of Robin’s raps, it’s a nice way to pay homage to her and her talent.”
Realness aside, it wouldn’t be a movie about superpowers without some powers and action segments. One notable sequence puts a woman who essentially becomes a victim of the powerful pill at the forefront, while a massive fight breaks out around her. It wound up being the “most complex shot” in the movie, Joost says, involving a “detailed choreographed camera move” and taking about a year to complete the visual effects involved.
Even amid some of those arduous shoots, the atmosphere managed to remain light.
“I give Jamie Foxx a lot of credit for creating an energy on set that was really upbeat and really fun, because shooting a movie is long tedious hours into the cold, wet night, and it can really be a slog,” says Schulman. “At one point we were shooting 17 nights in a row, and his energy was always upbeat, he always had a boombox, he would DJ.”
“He never let the set die down,” Fishback says, describing Foxx’s ability to make people laugh as his superpower.
From left: Courtney B. Vance as Captain Crane, director Ariel Schulman, Joseph Gordon-Levitt as Frank, and director Henry Joost on the set of “Project Power.” Skip Bolen—Netflix
The film was finished remotely, with Netflix sending out computers and equipment to technicians—largely visual effects artists—as coronavirus-related lockdowns began.
“We were lucky that we had shot everything and that we had about 20% of the way to go,” says Schulman. “We finished the visual effects, the sound design, the editing, and the score all remotely using a handful of computer programs.”
The filmmakers, who are particularly proud of how some fire- and ice-related effects turned out, ultimately hope that audiences will find their new movie “refreshing.”
“It’s just an affirmation that within the genre you can still have grounded character drama and some social commentary,” Joost says.
Project Power can be streamed on Netflix starting Aug. 14.


fortune--2020-08-13--Weekly jobless claims dipped below 1 million for the first time since March. But the numbers still a

Weekly jobless claims dipped below 1 million for the first time since March. But the numbers still aren’t pretty

In a pandemic, any incremental improvement is something of a relief. But taking a step back, the numbers are still staggering.
On Thursday, the Department of Labor said that weekly initial jobless claims were 963,000 for the week ending Aug. 8—down 228,000 from last week’s revised level, and, perhaps most importantly, below the 1 million mark for the first time in 20 weeks.
While the numbers are certainly better, “it’s just a testament to how far we’ve fallen. These numbers are bad. There’s no getting around it,” Edward Jones’s Nela Richardson states. “The economy isn’t creating new jobs, it’s just recouping these jobs that were lost.”
Indeed, Richardson is wary. “One week does not mark a trend, so that’s the first caution. The four-week moving average also went down, so that feels like some good news,” she tells Fortune. “I am concerned, though, that the momentum in the job market is losing steam. So that’s what I want to watch out for to make sure that momentum continues and that the claims, which suggest temporary layoffs, stay temporary.”
Indeed, fall is quickly approaching, and with it so is “the risk that the outbreak could see another economically damaging spike, as people resume more indoor activities and some school students return to in-person learning,” Bankrate.com senior economic analyst Mark Hamrick said in emailed comments Thursday.
And states seeing spikes in coronavirus cases like Texas, Georgia, and Florida are also seeing initial jobless claims come down. (In fact, Florida had the biggest drop in the country.)
But the big concern for many is that jobless claims remain extremely elevated compared to pre-pandemic levels (see chart), even as the $600 enhanced unemployment benefit just ended in July.
“It remains quite stunning that Congress has yet to agree on a fresh round of relief legislation with so many Americans hurting financially,” Hamrick said. “Even after the President’s controversial and narrowly focused executive orders, the nation’s governors and business interests alike have urged all sides to redouble their efforts to pass meaningful and much needed legislation. That focus should not ease because of slight improvement in still extremely elevated new jobless claims.”
While the unemployment rate has ticked down for the last few months, it still stands at a very elevated 10.2% for July, down from 11.1% in June. And although President Trump issued an executive order over the weekend to restart enhanced unemployment benefits, it’s at the very least questionable that the President will actually be able to get this done legally.
Plus, those like Richardson are worried not only about the timing of when new stimulus may pass, “but also how long” the stimulus will last. She believes we may need enhanced unemployment benefits through January.
Meanwhile, for investors, a snag in new stimulus plans may mean more volatility ahead, given that “a lot of the market rebound is based on the premise of continued stimulus. If there’s a hole in that argument for the markets, you might see a pullback or more volatility,” Richardson notes.
But, as Richardson points out, “one issue on these numbers could be that there’s less urgency in Congress if the numbers are going down for a deal to get done quicker.”


fortune--2020-08-13--Have a federal student loan? Your forbearance was extended to 2021

Given recent news of Democratic VP nominee Kamala Harris and revised unemployment benefits and mail-in voting changes for the upcoming election—phew!—federal student-loan holders may have missed some welcome news: They won’t have to pay them until 2021.
On Aug. 8 President Trump issued a memo ordering the Secretary of Education to extend the administrative forbearance of federal student loans through Dec. 31, 2020. That temporary measure, made in late March when the novel coronavirus pandemic was just settling in, was originally set to expire Sept. 30—about a month before Election Day.
“The 2019 novel coronavirus known as SARS-CoV-2, the virus causing outbreaks of the disease COVID‑19, has significantly disrupted the lives of Americans,” the memo reads. While the first measure of student-loan relief helped, “many Americans remain unemployed due to the COVID-19 pandemic, and many more have accepted lower wages and reduced hours while States and localities continue to impose social distancing measures. It is therefore appropriate to extend this policy until such time that the economy has stabilized, schools have re-opened, and the crisis brought on by the COVID-19 pandemic has subsided.”
Forbearance means the interest rates on the loans goes to 0% and payments aren’t required during the period. (If you’re interested in continuing to pay them—after all, you are fiscally responsible—you may.) Loan servicers will automatically place federal loans into forbearance without any additional action, but it’s best to check your account to ensure it happens. (If you’ve set up automatic, recurring payments from your bank account to your federal student-loan lender, those will be suspended, too.)
The most popular servicers for federal student loans are FedLoan Servicing, Great Lakes, Navient, Nelnet, Cornerstone, Granite State, HESC, MOHELA, and OSLA.
It’s worth noting that the latest reprieve applies only to federally held student loans—meaning your private student loans aren’t covered by the temporary forbearance, let alone the extension, and you’ll have to continue paying them.
But that still includes several types of loans, such as “Direct” loans and Parent Plus loans. Federal Family Education Loans, or FFELs, and Perkins loans are eligible only if they’re “federally held”—and most are not. (If you’re not sure, call your servicer or 1-800-4-FED-AID to find out if your loans qualify.)


fortune--2020-08-13--Brussels, dawn. Legal briefs drawn

Brussels, dawn. Legal briefs drawn

This is the web version of Data Sheet, a daily newsletter on the business of tech. Sign up to get it delivered free to your inbox.
(With apologies to Lin-Manuel Miranda, a spoof of Hamilton‘s “Your Obedient Servant” imagining a conversation between Facebook CEO Mark Zuckerberg and EU Competition Commissioner Margrethe Vestager. Best read while playing the original song.)
How does Vestager, an arrogant economist, liberal
trilingual, commissioner
Somehow endorse telecom consolidation, her enemy
A field she’s opposed since her hiring
Just to keep me from acquiring?
I wanna be in the Zoom where it happens
The Zoom where it happens
The Zoom where it happens
You’ve kept me from the Zoom where it happens
For the last time
Dear Margrethe:
I am slow to smile
But I can code a line
As I reckon with the probes
Of your agency on mine
I look back on where I bombed
And in every place I checked
The only common thread has been your disrespect
Now you call me “gatekeeper”
Say I “put democracy at risk”
If you’ve got something to say, post online don’t send a floppy disk
I have the honor to be your obedient servant
M dot Zuck
Mr. CEO:
I am not the reason no one trusts your platform
No one knows what to believe
I will not equivocate in my investigation
I have always been happy to aggrieve
Even if I taxed what you think I taxed
You would need to cite a more specific instance
Here’s an itemized list of thirty tweets of your president
Sweet Jesus
Hey, I have not been fallin short
I am just a gal seeking to purport in the public court
Tryna do my best for our European Union, I don’t wanna cite
But I won’t back down from shining the light
I have the honor to be your obedient servant
M dot Vest
Careful how you go astray, good gal
Looking for me to pay, good gal
Answer for the TikToks I post in your feed or bombs away, good gal
Zuck your frown is Instagramable
I stand by what I stated indefatigable
You acquire only for yourself to beat competition
I can’t apologize because it’s my mission
Then stand, Margrethe
Brussels, dawn
legal briefs drawn
You’re on
I have the honor to be your obedient servant
A dot Vest
A dot Zuck
Aaron Pressman
@ampressman
aaron.pressman@fortune.com
This edition of Data Sheet was curated by Jonathan Vanian. Check out Eye on A.I., the A.I. newsletter he writes weekly.
NEWSWORTHY
Driving off a cliff. Lyft’s sales dropped 61% year-over-year to $339 million in its latest quarter, underscoring how the pandemic has devastated the online ride-hailing company’s business, CNBC reported. John Zimmer, the company’s president and co-founder, also said that Lyft may suspend ride-hailing services in California due to a ruling earlier this week that would require Lyft and Uber to convert its independent contractor drivers into full-time employees.
Housing losses. Airbnb’s sales fell 67% year-over-year to $335 million in its latest quarter also due to COVID-19, Bloomberg News reported citing unnamed sources. Still, the home-sharing service is aiming to go public by the end of the year, the report said. From the article: Chief Executive Officer Brian Chesky had originally intended to initiate the listing process with the U.S. Securities and Exchange Commission on March 31. That was before Covid-19 closed borders, ground flights to a halt and left the company with more than $1 billion in cancellations.
The chips are falling. Cisco Systems said its sales declined 9% year-over-year to $12.15 billion in its latest quarter and that its CFO Kelly Kramer is retiring, MarketWatch reported. Cisco’s shrinking sales and weak guidance that missed analyst projections sent the company’s shares plummeting over 6% in after-hours trading. The networking giant will institute a $1 billion cost-reduction plan that will include “voluntary retirement offerings for Cisco employees,” the report said.
It won’t hurt us. Tencent Holdings said its sales grew 29% year-over-year to 114.9 billion yuan, or $16.5 billion, in its latest quarter, and asserted that the Chinese tech giant should be relatively unscathed financially despite any potential restrictions imposed by President Donald Trump on its WeChat app, The Wall Street Journal reported. From the article: The company generates less than 2% of revenue from the U.S., said Chief Strategy Officer James Mitchell. The executive order “clearly covers the U.S. jurisdiction, and consequently, we don’t see any impact on companies advertising on our platforms in China,” he said.
FOOD FOR THOUGHT
It’s horrible. Not only does Reels fail in every way as a TikTok clone, but it’s confusing, frustrating and impossible to navigate. It’s like Instagram took all the current functionality on Stories (a tool to publish montages of photos and videos with added filters, text and music clips), and jammed them into a separate, new complicated interface for no reason. To me, it’s really unclear whom this feature is for.
Taylor Lorenz of The New York Times shares her thoughts on Instagram’s new Reels service, which is very similar to the popular TikTok app.
IN CASE YOU MISSED IT
Grab CEO Anthony Tan: What Southeast Asia is teaching us about a post-pandemic world—Anthony Tan
Another Airbnb house party ends in a shooting. What the company plans to do about it—Danielle Abril
Kamala Harris could be the best thing that ever happened to Big Tech—Jeff John Roberts
Here’s how much Microsoft’s new folding Duo phone costs and how to order it—Aaron Pressman
Zoom and face masks are giving cosmetics brands an eye lift—Rachel King
(Some of these stories require a subscription to access. Thank you for supporting our journalism.)
BEFORE YOU GO
Sarah Cooper made a name for herself by turning President Donald Trump’s many bizarre press comments and speeches into zany TikTok videos that have captivated the nation. Now, Cooper’s rising popularity has caught the attention of Netflix, which has rewarded her with her own comedy special, Sarah Cooper: Everything's Fine. The new special will be directed by Natasha Lyonne and executive produced by Maya Rudolph, People reported.


fortune--2020-08-13--Hospitals want to reduce racial and socioeconomic disparities in health. Let’s start measuring their

Hospitals want to reduce racial and socioeconomic disparities in health. Let’s start measuring their progress

The world lost a true icon and a tireless advocate for community health and equity last year. As CEO of Kaiser Permanente, Bernard Tyson had a vision not just for healthier patients, but for a healthier and more just community. He recognized that hospitals and health systems can go beyond taking care of patients with serious illness and improve health outcomes by tackling such issues as violence, food insecurity, homelessness, and inequitable access to education and economic opportunity. Bernard’s mission was to think not only of the 11 million members of Kaiser’s health plans, hospitals, and health systems at that time, but rather to look at the 65 million people who live in its surrounding communities.
Indeed, in recent years, the American Hospital Association has highlighted many ways that hospitals and health systems can advance population health, reduce disparities and inequities in health and health care, and impact social factors that affect health (frequently referred to as “social determinants of health”).
So why aren’t such contributions by hospitals and health systems routinely assessed—and rewarded?
Rethinking hospital rankings
The COVID-19 pandemic and the resulting economic crisis have shed light on the enormous disparities in health and social well-being in this country, particularly those harming communities of color, rural communities, and communities affected by poverty.
Throughout the extreme pressures of the pandemic, hospitals and health systems have remained trusted and essential pillars of their communities. In many locales, these organizations are the largest employers and major contributors to community growth and development. Hospitals and health systems embracing a leadership role are offering critical preventive services on site, contributing to initiatives in their communities to protect health and save lives, and providing essential care and support for their own employees.
We can begin to incentivize a commitment to community health and equity if we embed it into our evaluations of hospital performance. Many major hospital ranking systems evaluate patient satisfaction and quality of care. Few assess preventive care. None put contributions to community health and equity on equal terms with other metrics.
It’s time for a change.
Our organizations—IBM Watson Health and the Johns Hopkins Bloomberg School of Public Health’s Bloomberg American Health Initiative and Center for Health Equity—have come together to examine how hospitals and health systems can help improve health outcomes and reduce disparities and inequities in their own communities. We believe they can accomplish this by including community health or equity measurements as part of assessing hospital and health system performance.
We believe that incentivizing hospitals and health systems to adopt best practices can help make communities everywhere healthier. That’s why our collaboration aims to identify meaningful measures of community health and equity that could be included in future rankings of hospitals and health systems, including the Fortune/IBM Watson Health 100 Top Hospitals program.
Innovative hospitals lead the way
We are searching across the country to find great models of what hospitals and health systems can do for their communities.
For example, at a time when community violence is on the rise, all hospitals provide emergency care for victims of violence; however, an inspiring group of hospitals are implementing creative programs to prevent future episodes of violence. In Michigan, the Detroit Medical Center Sinai-Grace Hospital, in collaboration with the Wayne State University Department of Emergency Medicine, partners with the Detroit Life Is Valuable Everyday (DLIVE) program. DLIVE mobilizes specially trained violence intervention specialists who engage with survivors of interpersonal violence to help them avoid repeat injury by addressing traumatic stress disorder and linking people to resources in education, employment, and legal advocacy.
Other inventive hospitals and health systems support home visit programs, develop guidelines for healthy hospital food, educate new mothers on safe infant sleep practices, and partner with local schools to provide health services to students. We have an opportunity to recognize and socialize these innovative models in an effort to help bridge the gaps that exist in many communities. Our goal is to make these great efforts as commonplace as the hospital gift shop.
Struck by a terrible pandemic and recognizing the devastating legacy of racism, many U.S. communities are hurting. At this pivotal moment in time, hospitals and health systems can play a critical role not just in community recovery, but also in community renewal. Recognizing and rewarding exemplary contributions to community health and equity is one place to start.
Kyu Rhee, a primary care physician and master of public policy, is vice president and chief health officer at IBM.
Joshua Sharfstein is director of the Bloomberg American Health Initiative and professor of the practice in health policy and management at the Johns Hopkins Bloomberg School of Public Health.
Rachel Thornton is an associate professor of pediatrics at the Johns Hopkins University School of Medicine, a practicing primary care pediatrician, and associate director for policy for the Johns Hopkins Center for Health Equity.


fortune--2020-08-13--Will Palantir be the first pandemic direct listing?

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Bulwark cash. That seems to be the mantra for Silicon Valley startups amid the economic uncertainty right now.
So it’s interesting to see Palantir reportedly planning to go public via a direct listing, a method that does not raise additional capital, but does offer a way for existing shareholders to sell their stock. According to Bloomberg, sources say that Palantir is preparing for a direct listing in late September.
As investors scrambled to make sense of the pandemic early on, direct listings seemed dicier as companies sought to shore up funding. But the funding environment has held up stronger than anticipated. Financing continues to flow, particularly among late-stage startups in private markets, while stock markets are roaring back to nearly all-time highs, in part buoyed by the government’s stimulus package.
Rather than raising in a public offering, Palantir revealed in early July that it had raised roughly $550 million of a planned $961 million in private markets, including a $500 million investment from Sompo Japan Nipponkoa Holdings.
The much-anticipated listing also comes at a time when recent IPOs have soared in first-day trading—much to the chagrin of investors like Bill Gurley, who see the first-day pop as underpricing on the part of bankers, and have championed the direct listing instead.
Kamala Harris is a breath of relief for Big Tech: Joe Biden selected Kamala Harris as his Democratic running mate earlier this week in a move that angered the more left-wing members of the party—but could usher in popularity and funding from Big Tech for Biden. Harris has often taken a more moderate line when it comes to the tech giants, many of which operate in her home state, California.
“The reality is that Harris is infinitely preferable to the tech industry than Biden’s other choices, as well as the Trump Administration, which has attacked Silicon Valley relentlessly,” writes my colleague, Jeff John Roberts. Read more.
Lucinda Shen
Twitter: @shenlucinda
Email: lucinda.shen@fortune.com
VENTURE DEALS
- Allbirds, the San Francisco-based direct-to-consumer shoemaker, is in talks to raise an undisclosed amount from Franklin Templeton that would value the company above its $1.4 billion valuation in 2018, per Bloomberg. Read more.
- Gong, a San Francisco-based revenue intelligence platform, raised $200 million in Series D funding bringing the company’s valuation to $2.2 billion. Coatue led the round and joined by Index Ventures, Salesforce Ventures and Thrive Capital, as well as Battery Ventures, NextWorld Capital, Norwest Venture Partners, Sequoia Capital and Wing Venture Capital.
- Blend, a San Francisco-based digital lending solution, raised $75 million in Series F funding, Canapi Ventures led the round and was joined by investors including Temasek, General Atlantic, 8VC, Greylock, and Emergence.
- THREAD, a Durham, N.C.-based provider of decentralized clinical research, raised up to $50 million. Water Street Healthcare Partners and JLL Partners were the investors.
- Kin Insurance, a Chicago-based insurance technology company, raised $35 million in Series B funding. Commerce Ventures led the round and was joined by investors including Hudson Structured Capital Management), Flourish Ventures, QED, Alpha Edison, Allegis NL Capital, Avanta Ventures, August Capital, and the University of Chicago.
- Reify Health, a Boston-based provider of cloud-based solutions for the clinical trial ecosystem, raised $30 million in Series B funding. Battery Ventures led the round.
- Unfold, a vertical farming startup formed by Leaps by Bayer (the impact investment arm of Bayer AG and Temasek), raised $30 million in funding.
- Omaze, a Los Angeles-based online fundraising platform, raised $30 million in Series B funding. FirstMark Capital led the round and was joined by investors including Causeway Media Partners, BDMI, Tusk Ventures, Inherent Group, Gaingels, Penni Thow’s Copper and Guy Oseary.
- Eden Health, a New York-based medical practice, raised $25 million in Series B funding. Flare Capital Partners led the round and was joined by investors including principals from Stone Point Capital, Greycroft, PJC, Max Ventures and Aspect Ventures.
- High Definition Vehicle Insurance, a Chicago-based commercial auto insurance business, raised $16 million in Series A funding led by 8VC and Munich Re Ventures. They were joined by Qualcomm Ventures and Autotech Ventures.
- Moka, a human resources automation startup, raised 100 million yuan ($14.4 million) in extended Series B funding. Read more.
- Natural Fiber Welding, a Peoria, Ill.-based textiles startup, raised $13 million in funding as it prepares to take its breakthrough technology to commercial scale. The round was led by Ralph Lauren.
- Labster, a Boston-based producer of virtual laboratory simulations, raised $9 million in funding. GGV Capital led the round.
- Torre, a San Francisco-based professional network for remote job seekers and recruiters, raised $5 million in seed funding. Investors include Uber's former global head of product operations Mike Shoemaker, Amazon and Apple former vice president Diego Piacentini, Instagram engineering chief Rodrigo Schmidt, and MatterScale Ventures.
- Till, a Washington D.C.-based flexible rental payments platform, raised $8 million in seed funding round led by Route 66 Ventures, MetaProp and NextGen Venture Partners.
- Elisity, Inc., a San Jose, Calif.-based zero-trust networking and software-defined access company, raised $7.5 million in seed funding led by Atlantic Bridge.
- Bambi Dynamic, a Tel Aviv-based data-and-connectivity platform for mobility insurance products, raised $6 million in funding. MS&AD Ventures led the round and was joined by investors including The Phoenix Insurance Company.
- Adaptive Shield, a Tel Aviv-based security startup, raised $4 million in seed funding from Vertex Ventures Israel.
- Stacklet, an Arlington, Va.-based commercial cloud governance platform, raised $4 million in seed funding from Foundation Capital and Addition.
PRIVATE EQUITY
- L Catterton invested in Public Goods, a membership-based grocery, household, and personal care company. Financial terms weren't disclosed.
- Waystar, backed by EQT, Canada Pension Plan Investment Board, and Bain Capital, acquired eSolutions, a revenue tech company focusing on Medicare billing, in a deal valued at $1.3 billion. Read more.
OTHERS
- Liberty Global plans to acquire Sunrise Communications (S:SRCG), a Swiss telecom firm, for $7.4 billion. Read more.
- Pegatron Corp. acquired the rest of Casetek Holding, a device casing maker. Read more.
- Goldman Sachs is looking to buy General Motors Co’s credit card unit, per the Wall Street Journal. Barclays is also among the bidders. Read more.
- ByteDance is in early discussions with Reliance Industries about a potential investment in TikTok’s India business, per TechCrunch. Read more.
- Baker Tilly US and Squar Milner, two accounting firms, merged. Financial terms weren't disclosed.
BREAKUPS, HANGUPS, AND BANKRUPTCIES
- Thermo Fisher Scientific (NYSE: TMO) terminated its agreement to buy Qiagen (DE:QIA), a German genetic testing firm, after a tender offer valuing the latter at 11.3 billion euros ($13.4 billion) failed to get enough support from Qiagen investors. Read more.
- Stein Mart, a Florida-based off-price retailer, filed for Chapter 11 bankruptcy protection. Read more.
IPOS
- KE Holdings, a Beijing-based housing platform, raised $2.1 billion ($800 million bought by insiders) in an offering of 106 million ADSs priced at $20, above its previous range. The company posted revenue of $6.5 billion and losses of $308.5 million in 2019. Firms including Tencent, SoftBank, and Hillhouse back the firm. It plans to list on the NYSE as “BEKE.” Read more.
- Mr DIY Group, a Malaysian home improvement retailer, revived plans for a $500 million initial public offering. Read more.
- Best Inc (NYSE: BEST), a Chinese supply chain company, is seeking a Hong Kong listing for its express delivery and freight delivery businesses, per Reuters. Read more.
EXITS
- Roper Technologies Inc (NYSE: ROP) will acquire Vertafore Inc, an insurance software vendor backed by Vista Equity Partners and Bain Capital, for about $5.35 billion. Read more.


fortune--2020-08-13--Which industries will thrive—or be in the crosshairs—in a Biden-Harris administration, according to

Which industries will thrive—or be in the crosshairs—in a Biden-Harris administration, according to analysts

The speculation is over.
With Joe Biden’s announcement of his vice president pick, Kamala Harris, investors now have a clear picture of the Democratic ticket for 2020. And according to Wells Fargo Investment Institute’s senior global market strategist Sameer Samana, that’s helped take a little tail risk off the table.
“If [Biden] had gone with, let’s say, an Elizabeth Warren, who would have been viewed as much more, call it, ‘anti-financials’ [and] a little bit more on the regulatory front, that would have been seen as a negative,” he tells Fortune. “What the Harris pick does is it maybe trims the tail just a little bit in terms of, ‘Now that we know it’s Harris, and we know it’s not someone who was anchoring the progressive wing of the party, some of that tail risk has been removed.’”
While Harris’s appointment as running mate does put to bed the possibility of a far more progressive ticket, in general, “vice presidential candidates rarely have a significant impact on financial markets,” UBS Global Wealth Management’s head of Americas fixed income Thomas McLoughlin wrote in a note Tuesday. “We do not expect the U.S. equity or fixed-income markets to react abruptly to the selection because the choice was adequately telegraphed as a real possibility for weeks,” he writes.
But that doesn’t mean investors aren’t pondering what a Biden-Harris administration might look like—and which industries might be most sensitive to the duo’s proposed policies.
For months analysts have been positing what Biden may mean for stocks (JPMorgan, for one, suggested he could be a positive for markets). But perhaps the headline concern for those on Wall Street (and corporate America) is Biden’s resolve to raise corporate taxes.
Yet analysts at JPMorgan wrote in July that the “headline risk might be greater than actual policy,” and Samana concedes a massive tax hike is unlikely to happen (at least anytime soon) “while there’s still an overall sluggishness to the economy.”
Some industries that might actually be impacted by a Biden-Harris ticket, though, include pharmaceuticals. At this point, Medicare for All is pretty much off the table, but President Trump’s fight to lower drug prices will likely be carried on by a President Biden, Samana suggests, meaning potential headwinds for Big Pharma.
Meanwhile, although tech has been a hot-button industry as of late, with continued calls for more crackdowns on privacy and regulation, Biden’s choice in Harris might actually be good for Big Tech. As Fortune‘s Jeff Roberts recently reported, with Harris’s ties to Silicon Valley and seemingly toothless calls to break up tech, “Harris is infinitely preferable to the tech industry than Biden’s other choices, as well as the Trump administration, which has attacked Silicon Valley relentlessly,” Roberts writes.
Samana also notes a Biden-Harris presidency would mean “a pendulum swing back a little bit more toward the progressive side” and points out energy and environment-sensitive industries would likely be in the crosshairs. “If you’re an old-school energy company, things are probably only going to get harder for you. If you’re more oriented toward solar, wind, or electric vehicles, then you could see how government policies kind of tilt in your favor,” he notes.
Indeed, analysts at JPMorgan wrote in July that stocks like Tesla, Nikola, and FirstSolar are poised to be outperformers during a Democratic reign, while oil and gas producers like Apache and Pioneer Natural Resources may underperform.
Meanwhile, raising minimum wage to $15 per hour (an item long on Biden’s platform) could be a negative in the eyes of Wall Street, Samana suggests, as it could mean a “hit [to] corporate profitability” that “would possibly spook financial markets.” And while analysts at JPMorgan wrote a higher minimum wage might be a “neutral to positive” for S&P 500 companies, especially health care and tech, it “could create additional stress between companies that are able to absorb higher wages vs. those with lower pricing power/scale,” with stocks like Macy’s, Marriott International, and Kroger likely to lag. But on the flip side, Samana points out a hike in wages could also “be offset by greater consumer confidence and consumption.”
While it remains to be seen how campaign promises and policies actually shake out (and how they might impact investors), strategists like Samana note the finalized ticket “continues the understanding that a President Biden would be kind of a return to the political norms that existed prior to a Trump presidency,” he suggests. “The Harris pick further cements that.”


fortune--2020-08-13--Startup accelerators don’t work for female founders. Here’s how to fix that

Startup accelerators work great for most startups. But not for female founders.
This is something I’ve intuited for years. So many experiences have driven that lesson home: The time I found myself unable to even consider most accelerators because I couldn’t afford to leave my family for three months. The time I attended a demo night and out of a dozen or so companies there was only one woman on a team slide—and her title was “Executive Assistant.” The times—and there have been many—when members of our community who are going through top accelerators themselves share their experiences with me: their struggle to fit in; their struggle to keep up with the hustle-and-play-hard environment; their struggle to fundraise despite the programs’ genuine best intentions to help them.
A study published earlier this year by the International Finance Corporation, a subsidiary of the World Bank, confirms what I’ve long suspected. The pollsters found that all-male teams went on to raise 2.6 times more money after completing an accelerator compared with startups that do not attend a program, while female-founded teams that completed accelerators saw no uplift at all.
Accelerators have the power to be a great democratizing force in venture capital, but this promise will never be fulfilled until we make accelerators work for female founders.
Ready Set Raise, the accelerator I launched through the Female Founders Alliance, was designed to solve this problem. Despite our own short trajectory, we’ve demonstrated results: The eight companies in our most recent cohort raised nearly $5 million at the pre-seed stage in just a few months. The question is, Which startups are most successful in the accelerator environment, and how do we replicate their success?
In our experience, what makes the biggest difference for female founders is how they connect to investors. Most accelerators—ours included—culminate in an investor showcase, a closed-door, invite-only event where startups present their perfect pitch to a large group of vetted investors. What we’ve learned is that relying on the showcase for the purpose of fundraising rarely works. Instead, startups succeed only when they build excitement and rapport in the weeks leading up to the showcase, and sustain investor relationships in the months after, all while demonstrating consistent business growth.
There are three components to replicating this success. First, founders need to know how to talk about their business model, what KPIs to measure, and how and when to communicate their results. Ready Set Raise, and other accelerators that want to support female founders, should spend dedicated time helping founders understand their business model, build a data room, and write investor updates.
Second, founders and investors must get to know each other more meaningfully—not just a one-and-done onstage. We do this by hosting events and office hours with emerging fund managers across the country. While these meetings feel scary to founders, great, stage-appropriate investors want to engage with founders before the point of perfect polish.
Finally, founders must learn to confidently soft-pitch their company before the pitch is perfect. This is a skill you can learn and a muscle you can build, and accelerators can add programming to support both.
Fundraising successfully—and running a startup successfully, for that matter—are not achieved in a one-time-only, perfect onstage performance. You have to build lasting relationships that matter. You have to know how to describe your business in a way that investors can understand and get excited about. And you have to be ready to pitch at any time.
Ready Set Raise will help founders to always be ready. And we’re open-sourcing our program design so other accelerators can help female founders succeed too.
Leslie Feinzaig is the founder and CEO of the Female Founders Alliance.


fortune--2020-08-13--Millions in England test positive for COVID-19 antibodies, with the poor and minorities hardest hit

Around 3.4 million people in England—6% of the population—have contracted coronavirus, with infection rates twice as high in London, a major antibody study found.
A mass survey of more than 100,000 people—which the government says is the biggest of its kind in the world—suggested the extent of the outbreak varied widely between different areas and population groups.
In London, 13% of people had antibodies while in the South West of England it was less than 3%, according to the research, released by the Department of Health and Imperial College London. People from Black, Asian and other minority ethnic groups, care workers, and people living in larger households were among the most likely to have been infected.
The research involved 100,000 people testing themselves at home for coronavirus antibodies between June 20 and July 13. The government said there is no firm evidence that antibodies provide immunity.
But the findings are significant because they are likely to influence the decisions officials will make about what kind of lockdown restrictions are needed in the future, and which groups are at greatest risk. Boris Johnson’s government has been attacked for its handling of the pandemic, which left the U.K. with the highest death toll in Europe and facing the deepest recession of any comparable country.
Heavy Burden
There was no breakthrough on the quest for a home antibody test for general use among the public. Separate studies, also unveiled on Thursday, evaluated a range of finger-prick home antibody tests but found the results were not reliable enough to be given government approval for widespread use, officials said. The tests were still deemed to be suitable for surveillance studiessuch as the Imperial research.
The burden of Covid-19 “has fallen particularly heavily on ethnic minority groups and key workers, particularly in care homes and healthcare,” said Professor Helen Ward, one of the researchers involved. “Those in deprived and densely populated areas are most likely to have been exposed to the virus, and we need to do far more to protect people from any future waves of infection.”
The findings included:
Among the most likely to have been infected were care home workers (16%) and health care staff (12%).
In the wider population, 17% of people from Black backgrounds and 12% of people from Asian groups were infected.
People in the most deprived areas of England had higher antibody levels than those in the wealthiest areas.
The study suggested one in three people with antibodies showed no symptoms, a feature that increased among the over-65s.
This surveillance study will be repeated in autumn and will test a further 200,000 people for antibodies. The government urged more people to sign up.
“Large scale antibody surveillance studies are crucial to helping us understand how the virus has spread across the country and whether there are specific groups who are more vulnerable,” Health Minister Edward Argar said in an emailed statement. “We don’t yet know that antibodies provide immunity to coronavirus, but the more information we can gather on this virus, and the easier we can make it for people to participate in these studies, the better equipped we will be to respond.”