fortune--2020-06-28--When should you sell your stocks? Only in these cases

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There is always going to be a good reason to sell out of the stock market.
When stocks were getting slaughtered in March, investors wondered if they should sell because it felt obvious stocks would fall further.
Now that stocks have rallied, investors are wondering if they should sell because it feels obvious stocks have risen too far, too fast.
Those who actually sold a few months ago near the bottom of the bear market are in a much tougher position than those who are considering selling out now but anytime you make a wholesale shift in your asset allocation it’s a challenging decision.
These types of decisions become even more taxing when you’re in or approaching retirement. At that stage, your human capital is dwindling and you don’t have nearly as much time to wait out the painful bear markets as younger investors.
With valuations on the stock market above average and interest rates as low as they’ve ever been, you could make the case that the current investment environment is as challenging as it’s ever been for retirees. This situation makes it even more tempting that usual to time the market.
I’ve had a number of discussions with investors who were contemplating selling out of stocks in March. Many we retirees who worried about how an extended downturn could impact their retirement plans.
I understand why this group is more trigger happy with their portfolio. The U.S. stock market was up 10 out of 11 years heading into 2020. This crisis was looking like it could turn into Great Depression 2.0.
We’re living in scary times.
But scary times and panic are never good reasons for selling out of your stocks. Selling out and waiting for the dust to settle is also a horrible plan. Even valuations are close to useless as a timing indicator for the stock market as anyone who has traded based purely on fundamentals the past 20-30 years can attest.
A bear market is one of the worst times to completely overhaul your asset allocation because your decision-making ability will be clouded by your emotions.
So when should you sell some or all of your stocks?
When you need to rebalance
The all-in or all-out game is one of the most dangerous you can play when investing. Sure, you could luck out once or twice but eventually you’re going to end up selling out before a huge boom or buying before a huge bust.
Unless you have a rules-based approach that you follow come hell or high water, an extreme strategy like this will cause you to make a huge mistake at the worst possible time.
The simplest form of selling comes when you have a target asset allocation in mind and religiously rebalance back to your target weights on a set schedule or pre-determined threshold.
After stocks were up more than 30% in 2019 that would have resulted in selling some of your stocks to buy more bonds, cash or other investments following a big run-up in prices. And after stocks dropped more than 30% in the spring and bonds acted as a ballast to a diversified portfolio, that would have meant selling some of your fixed income and buying more stocks. Now that stocks have risen 40%…you get the picture.
The timing of a rebalance will never be perfect but setting up a specific asset allocation that takes into account your willingness, ability and need to take risk removes the temptation to go all-in or all-out based on your gut instincts and sell based on a set plan.
When you need to diversify
I know a number of investors who kept the majority of their retirement assets in the stock market in lieu of bonds for their entire accumulation phase. This strategy is not for the faint of heart but when you’re a net saver with a high tolerance for short-term financial pain, the results can be wonderful when you stay the course.
Once that accumulation phase is over and the transition into the distribution phase of retirement begins, this introduces a new dynamic into the investment planning process. You don’t want to be forced to sell your stocks during a nasty bear market for spending purposes, so at some point even investors with the highest tolerance for risk realize they need to keep a chunk of their spending needs in cash or bonds.
The depths of a bear market is not a great time to have this investment epiphany but a huge run-up in stocks is never a bad time to reassess your diversification profile.
When you’ve been proven wrong about an investment thesis
This one is more relevant for those who hold more concentrated positions in single stocks or niche ETFs. Every investor should perform a premortem that signals when it’s time to pull the plug and bail on an investment idea that simply didn’t pan out.
This can be harder than it seems because What if I just wait until it breaks even?! or What if it rallies right after I sell?! are both rather compelling arguments in a loser position.
When you’ve won the game
If you’re lucky enough to amass something in the neighborhood of 20-25x your expected living expenses in retirement and have a decent handle on your spending habits, at a certain point you may ask yourself—What’s the point of playing anymore?
This decision was much easier to make in a world that actually gave investors some form of default-free yield. Unfortunately, there is no more going to the beach and living off the interest anymore from high-quality bonds.
But if you built up a big enough nest egg and are secure enough in your lifestyle inflation, some may find it hard to continue taking so much stock market risk in their portfolio.
As long as you’re willing to sit out potential future gains to avoid bone-crushing volatility, I have no problem with this strategy.
When you’ve determined your risk profile, time horizon or circumstances have changed
Most investors assume portfolio moves should be dictated exclusively by what’s going on in the markets. This is why investors are constantly comparing fundamentals to figure out where we stand relative to history and what it might mean going forward.
And sure, understanding the past and present about the markets can help make informed decisions about the future. But every portfolio decision doesn’t have to come down to market fundamentals.
You must also consider how your current circumstances impact your risk profile. Sometimes you need to dial down the risk because you’re in a better place financially than you expected. Maybe you received an unexpected windfall or aren’t spending as much as you budgeted for.
It’s impossible to create a portfolio if you don’t have a handle on your goals and a reason to invest in the first place. Markets matter but you should always begin the investment decision-making process by thinking about where you are—and where you’d like to be.
Ben Carlson, CFA, is the director of institutional asset management at Ritholtz Wealth Management. He may own securities or assets discussed in this piece.


fortune--2020-06-28--Outdoor Voices looks to a new female founder to turn the brand around

Experts : Get used to the surge in new U.S. coronavirus cases

Even before the coronavirus pandemic decimated retail businesses, Outdoor Voices was struggling. Multiple reports in February and March identified challenges within the athleisure darling, from employee concerns about the leadership of founder Ty Haney to significant financial losses.
Now, a new leader is stepping in with a clear mission: turn the brand around. On Sunday, the company announced that Ashley Merrill, founder and CEO of the women’s sleepwear brand Lunya, will become chairperson of Outdoor Voices’ board of directors. NaHCO3—the venture capital arm where Merrill serves as principal alongside her husband, Marc Merrill, the co-founder and former co-CEO of Riot Games—is making an investment in the company; Merrill declined to disclose the size of the deal. Haney, who resigned as CEO in February, remains on the company’s board.
“Outdoor Voices was part of that period of time when businesses were approaching business from a growth-at-all-costs perspective,” Merrill said in an interview with Fortune. “The industry has shifted quite a lot since then. As someone who has tried to run a business with an eye toward profitability, I’m looking to help OV make that transition.”
Merrill founded Lunya in 2014, the same year Haney founded Outdoor Voices. But the self-funded Lunya was more “capital-constrained,” Merrill says. That led her to build the business through a different strategy—measured growth, maximizing return on ad spend, and a focus on profitability. (Lunya is also sold at a higher price point than Outdoor Voices: a sleep t-shirt retails for $88 compared to a $35 OV tee.)
In recent years, Outdoor Voices had attempted to hire—and then struggled to retain—seasoned retail executives as the brand sought to maintain its fast growth. Merrill, 36, instead plans to apply her different type of direct-to-consumer background to the workout brand; she will be a hands-on chair as the company searches for an “omnichannel retail leader” to serve as its next CEO. (Cliff Moskowitz was appointed interim CEO after Haney’s ouster, but recently left the position.)
Merrill reached out to Haney as reports emerged about the company’s challenges in February. The 31-year-old founder was reportedly locked in a struggle with Mickey Drexler, the former J. Crew and Gap Inc. executive, who previously served as chairman; Drexler left the company’s board this spring.
“The business fundamentals are there. With good leadership and good progress, I think it’s totally within reach to solve these business challenges,” Merrill says. “What I hope we can bring into this new chapter is intentionality around decision-making, clarity in leadership, and a supported organization that can help employees and the eventual CEO feel aligned.”
Merrill’s appointment alongside Haney on the board of directors puts two young women back in the driver’s seat of a female-focused brand that, until recently, seemed destined to be handed over to male retail executives. (Haney’s ouster as CEO was one of several upheavals at female-founded startups over accusations of mismanagement and, in some cases, mistreatment of employees in recent months.)
In her perch on the company’s board, Haney will now play to what Merrill identifies as her strengths: brand vision and understanding of her customers. “We are thrilled to have Ashley joining Team OV. She brings tremendous operating experience, strong leadership, and talent in brand and product,” Haney said in a statement shared with Fortune. “We are well positioned for a successful next chapter.”
Merrill acknowledges the challenges that Outdoor Voices has faced, including employee criticism of the company’s leadership. “No one is denying how beloved the Outdoor Voices brand is,” she says. “My hope is that having more alignment at the top will help. We’ll be able to get in front of those challenges they had before.”


fortune--2020-06-28--Experts: Get used to the surge in new U.S. coronavirus cases

The Coronavirus Economy : How office layouts could change for good because of the pandemic

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A surge in coronavirus that has seen record numbers of new U.S. cases in recent days is likely to continue for weeks after states moved too soon to reopen their economies, two of the country’s leading public health experts said Sunday.
The warnings by Tom Frieden, director of the Centers for Disease Control from 2009 to 2017, and Scott Gottlieb, the former head of the U.S. Food and Drug Administration, came as a new poll showed confidence in how the U.S. is dealing with COVID-19 has fallen.
In an interview with Fox News Sunday, Frieden said the virus continued to have the “upper hand,” even as he acknowledged Americans had become tired of the restrictions needed to contain it.
“We’re all sick and tired of staying home. But you know what? The virus is not tired of making us sick,” he said.
“We are moving too fast,” Frieden said of states that remained eager to continue phased re-openings as cases continue to rise. “It’s like leaning into a left hook. You are going to get hit hard. And that’s what is happening.”
2.5 million cases in the United States
U.S. coronavirus cases now exceed 2.5 million, with over 125,000 reported fatalities—in both cases the world’s highest. The country’s inability to control the spread of the virus seems likely to result in U.S. citizens being banned from traveling to Europe, for example, where cases are down in some cases 90% from their peak.
A move by the EU to restrict travel from the U.S. was the inevitable result of the continuing spread in America, Gottlieb said. Growing restrictions on travel within the U.S. could come next, he said.
A CBS poll released on Sunday showed 62% of those surveyed said U.S. efforts to deal with the virus are “going badly,” up from 57% in early June. The percentage who said President Donald Trump was doing a “good job” on the virus was 41%, the lowest of five polls taken since late March.
The survey of 2,009 U.S. adults was taken June 23-26. It had a margin of error of plus or minus 2.6 percentage points.
Alex Azar, the U.S. Health and Human Services Secretary, said on CNN’s “State of the Union” that the “window is closing” to control the spread of the virus.
“This is a very, very serious situation,” Azar said, a downbeat assessment contradicted by Vice President Mike Pence in a later interview.
‘Much better place,’ claims Pence
Pence, who’s visiting Texas on Sunday, played down the current surge in states, stressing that it affected just 4% of U.S. counties and had been caused by more cases in young people, who were less likely to suffer serious health consequences.
“We’re in a much better place to respond to these outbreaks than we were four months ago,” Pence told CBS’s “Face the Nation,” noting that the nation is testing about 500,000 people a day and has a greater capacity for surveillance and community testing.
“We’ve also expanded our health-care capacity across the country, literally seeing delivered billions in personal protective equipment, ventilators,” he said. “And most importantly in this moment is we’ve seen the development and distribution of therapeutics that have literally been saving lives around the country.”
Pence also dismissed concerns that the increase in new infections had been driven by the rapid easing of public health restrictions and the Trump administration’s push to reopen the economy rapidly with November’s election in mind.
The importance of masks
“There’s a temptation to associate the new cases in the Sunbelt with reopening, but it’s important to remember” that states including Florida and Texas actually began to open up in early May and avoided a spike in infections “for the better part of six weeks,” he said.
Also on “Face the Nation,” Gottlieb said the spread of the virus was likely to continue growing in the absence of requirements for the “universal masking” of people in affected states.
Requiring people to wear masks is “the simplest intervention that we could take” to stop the spread of the virus, Gottlieb said. Polls, including the CBS survey, show the issue of wearing masks has become highly politicized in the U.S.
While the virus has ebbed in the Northeast, states like Florida, Texas and Arizona have seen virus cases spike in recent days. Other measures, including hospitalizations and deaths, haven’t risen as much.
On Sunday, Florida officials said the state’s coronavirus cases rose 6.4% from a day earlier. Cumulative hospitalizations of Florida residents rose 0.8%. Cases in Arizona jumped by 5.5%, above the state’s average of a 4.4% daily increase over the past week.
The current record rates of newly reported cases at 40,000 or more in recent days likely reflected a far bigger outbreak, Gottlieb said.
Some encouraging signs
By the CDC’s own reckoning, the real number of infections was 5 to 10 times that being reported, Gottlieb said, and that meant the real rate of new infections was likely to be a “quarter-million” each day.
Frieden said that while there were potentially encouraging signs in the growing share of younger people—who are less likely to suffer severe complications—among new reported cases, that shouldn’t be a reason to grow complacent.
“What starts in the young doesn’t stay in the young,” he said, since younger people, often asymptomatic, can spread the coronavirus to more-vulnerable individuals including family members and co-workers.
It was false to dismiss the recent surge in daily cases as a function of a ramping up in testing, Frieden said. A lower death rate was also potentially misleading, he said, with reported deaths likely to lag a surge in cases by about a month.


fortune--2020-06-28--The Coronavirus Economy: How office layouts could change for good because of the pandemic

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In the wake of the pandemic, furniture design specialist Knoll has seen explosive demand for work-from-home solutions. As a result, the retailer is doubling down on investing in e-commerce and visualization capabilities. Knoll is also consulting with clients on their return to the physical office when the time is right.
Fortune spoke with Andrew Cogan, chairman and CEO of Knoll, for a new series, The Coronavirus Economy, about how the outbreak has affected his business, his thoughts on the future, and how he is working through the pandemic.
The following interview has been lightly edited and condensed for clarity.
Fortune: How has the outbreak of COVID-19 affected Knoll, and by extension, the interior design industry at large? How has the pandemic altered Knoll’s operations and workforce?
Andrew Cogan, chairman and CEO of Knoll Courtesy of Knoll
Cogan: We’ve learned a lot about keeping our people safe. We operate in countries all over the world, with associates in offices and manufacturing facilities across North America, Europe, and Asia. I wish I could say we had a pandemic playbook on the shelf, but what we do have is an amazing seasoned team that we’ve spiked with new talent. Together, we all pivoted pretty quickly to remote work and kept our principal manufacturing operations open in most locations with enhanced health and safety standards. We did have to suspend operations in Italy, but fortunately those facilities are open again.
I expect design-driven businesses like ours that continue to invest in innovation, design, and technology will thrive. With respect to the spaces we occupy—the workplace and the home—we see a lot of opportunity coming out of this pandemic. People crave the community, connectivity, and creativity of the office; at the same time, consumers will be spending more time in their abode than on travel or entertainment.
A Knoll-planned space created with a freestanding meeting structure surrounded by lounges and individual work areas, featuring an Antenna Power Beam, Generation chairs, and Tone height-adjustable desks. Courtesy of Knoll
Have you been going into an office still? Or have you been working from home? What does your average day look like now?
I’m based in New York, and I am transitioning back to working at our headquarters in Manhattan. I continue to work from home a fair amount as well, which, like many of us, I did prior to the pandemic. In many ways, my day-to-day is illustrative of where we see our clients moving. People want to come back to the office; at the same time, we expect work from home to be a bigger part of the mix for many people going forward.
I’ve been spending a lot of time on our strategy to grow Knoll’s work-from-home solutions and e-commerce capabilities. Unsurprisingly, demand for work-from-home solutions has skyrocketed in the past few months. Fortunately, we were moving aggressively in this direction before the pandemic. We acquired Fully.com—an e-commerce brand devoted to home-office design—last year, which set an all-time record for sales in March, and our Muuto brand is poised to meet work-from-home solutions as well.
My other big focus has been our work to guide clients on the safe return to the workplace and envisioning what the post-pandemic office environment will look like. I check in with clients and stay close to the design team’s work, and we’re moving quickly on new offerings to help retrofit offices for short-term reopenings as well as longer-term workplace design solutions.
Depending on where they are, some nonessential workers have already started going back to the office. There are a lot of ideas out there, but what do you think the future of the office space is as employees readjust? What kinds of protective and social distancing measures need to be in place, and how does interior design play a role?
The workplace is not going away. The benefits of the mix of community, connectivity, culture, and spontaneity you get in the workplace is simply irreplaceable. We’re hearing from our own people and from our clients that they want to come back to the office. This has created lots of opportunities for the design community, dealers, and our clients to retrofit, redesign, and reimagine their workplaces. And I think we’re on point with the thought leadership, design collaborations, and products as well as the distribution channels to support all that.
Right now, to start to bring people back to the office, it’s all about reorienting circulation and reorganizing space—and providing screens for space delineation. I expect that this phase will be followed by a shift in overall facility design, exploring meeting and gathering areas, for example, where you are not in an enclosed room, but working in open freestanding architectural structures surrounded by lounge and individual work areas, all designed to facilitate distancing and enhanced airflow—a much healthier environment overall.
A Knoll-planned workplace, including an accessible, open entryway; generous circulation paths; internal stairs as an alternative to elevators; a connection to the outdoors from almost every space; group areas and places for people to be alone; flexible spaces and technology to connect coworkers in the office with those working remotely. Courtesy of Knoll
What about coworking spaces? How do private social clubs and shared offices need to rethink their design and layout?
Coworking spaces fulfill the same needs for connectivity as more traditional workplaces. In all likelihood, some areas of coworking spaces are already well designed for the new reality, and some will need to be updated. The solo gig worker who maintains a small office space is already separated from others. But densely packed open-plan areas will have to be revamped and reimagined just like traditional office spaces.
We also expect that the mix of clients using coworking spaces could evolve. With many predicting decreased startup capital, these spaces may be underutilized by incubator-type businesses and could turn to providing established companies with places for their own teams during this period of social distancing.
Longer term, either in next year if we get a vaccine or if this is indeed the new normal indefinitely, how should companies across sectors plan for the future?
Once there is a vaccine, I think that people will start to gravitate once again to welcoming, comfortable, collaborative areas of the office. Looking back over the past five or so years, much of our business has been about designs that support a “resimercial” experience; everyone wants to make their office feel more like their home.
Flash-forward to today: In many ways, what we’re doing is bringing the office to the home. Everyone has pivoted from their offices, at least temporarily, and companies are acknowledging that work from home will be a more permanent part of their mix. But companies are also recognizing that work from home comes with issues of social isolation, ergonomics, and wellness: Not everyone can have a place at home for focused work. Our work styles and the spaces that support work are undoubtedly going to change coming out of this pandemic, but inspiring spaces where people can do their best work remain vitally important to the ingenuity and creativity of individuals and teams.


fortune--2020-06-28--With approval ratings at an all-time low, Putin is making moves to stay in power until he’s 83

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After two decades in power, Vladimir Putin’s approval ratings are at an all-time low as Russia’s economy reels under the impact of the coronavirus epidemic and the slump in oil prices. What better time for him to seek to extend his presidency for potentially 16 more years?
It’s a measure of how tightly Putin has controlled the operation to amend Russia’s constitution that there’s little suspense about the result of a referendum on the changes, despite the economic pain unleashed by the virus. Approval in the vote that concludes July 1 will allow him to seek two more six-year terms after his present one ends in 2024, staying in power until 2036, when he’d be 83.
Still, amid rising public discontent, officials are pulling out all the stops to ensure a high turnout in a vote Putin wasn’t obliged to call. While a simple majority in favor and a turnout exceeding 50% of eligible voters is all that’s required, the Kremlin won’t be happy with anything less than an overwhelming endorsement. It’s sought to woo Russians with populist sweeteners such as an effective constitutional ban on gay marriage.
“People are disenchanted with the ‘presidential republic’ and iron fist they believed in 20 years ago,” said Sergei Belanovsky, a Moscow sociologist who helped to produce polling that predicted the biggest protests of Putin’s rule in 2011-2012 and is now tracking a renewed increase in negative attitudes toward the leadership of the country.
Putin caught even many in his inner circle by surprise in January when he announced plans to carry out the most extensive reform of the constitution since it was adopted in 1993. But the clause allowing him to sidestep term limits didn’t appear until March, even if many officials later suspected that had been his plan all along.
Putin is already the longest-serving leader of the world’s largest country by landmass since Soviet dictator Josef Stalin. After a 2018 backlash over a pension-age increase, the former KGB colonel has found it harder to maintain public support as falling living standards stir increased resentment.
His popularity rating at 59% – though still respectable by western standards – is the lowest since he became president in 2000, and has fallen to the level of regional governors whom Putin routinely used to out-poll, according to the Levada Center, an independent pollster in Moscow.
Putin, who delegated the main responsibility for combating the spread of Covid-19 to regional chiefs, has seen his ratings fall because of people’s unhappiness at the current economic crisis, said Levada analyst Denis Volkov. At the same time, the authorities for now remain in greater control than they were at the time of the mass demonstrations almost a decade ago with most Russians still hopeful the country will emerge from the crisis, he said.
After years of stagnation, Russia’s economy may shrink by 6.6% this year, the worst contraction since 2009 in the wake of the global financial crisis, according to the International Monetary Fund. Growth has averaged under 2% in the past decade, far down on the more than 7% annual expansion that helped incomes soar during Putin’s first two terms as president. The Russian central bank sees little room for improvement in coming years without structural reform.
Real incomes are falling after stagnating over the past six years, while unemployment climbed to 6.1% in May from 4.7% in March.
Putin stirred patriotic sentiments before the referendum with a massive military parade in Red Square on June 24 to mark the 75th anniversary of the defeat of Nazi Germany in World War II, a commemoration delayed by the virus from May 9. He also sought to win over ordinary Russians on the eve of the vote by unveiling fresh cash payments for families and the unemployed and a tax increase for the rich.
Levada’s latest poll conducted late last month showed fewer than half of people support the constitutional reform. State employees are being pressured into voting, according to election monitoring group Golos, which said that the use of large-scale online voting for the first time and the week-long balloting process made it harder for independent observers to uncover any violations.
State pollster VTsIOM puts support for Putin at a much higher level, reporting trust in the president ranging between 66% and 73% in 2020. It published a June 23 forecast showing between 67% and 71% of voters will back the amendments in the referendum.
Sense of security
The authorities’ calculation is that people, whatever their reservations, will mostly rally behind at a time of national crisis out of recognition that the government offers a sense of security, said an official with knowledge of Kremlin political planning.
Belanovsky, the sociologist, said his most recent research of public opinion conducted this month shows that a majority supports aspects of the constitutional changes aimed at upholding traditional values but only a minority backs Putin’s wish to reset his term limits to zero at the end of his current mandate.
Interviews with focus groups from March to May have pointed to a sharp sense of disillusionment both with the president personally and the government as a whole, according to Belanovsky. People are angry about falling living standards, corruption and a lack of help from the authorities to counter the economic fall-out of the lockdown during the pandemic, he said.
VTsIOM’s head Valery Fyodorov dismissed Belanovsky’s research as “pseudo-polling” that is “not based on scientific sampling” in a commentary on Wednesday.
Putin’s rule has become “far less legitimate,” according to Tatiana Stanovaya, head of R. Politik, a political consultancy. “Social dissatisfaction is building up, but we won’t see the consequences until later.”


fortune--2020-06-28--Scientists don’t expect a coronavirus vaccine to be nearly as protective as the measles shot

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People on six continents already are getting jabs in the arm as the race for a COVID-19 vaccine enters a defining summer, with even bigger studies poised to prove if any shot really works — and maybe offer a reality check.
Already British and Chinese researchers are chasing the coronavirus beyond their borders, testing potential vaccines in Brazil and the United Arab Emirates because there are too few new infections at home to get clear answers.
The U.S. is set to open the largest trials — 30,000 people to test a government-created shot starting in July, followed about a month later with another 30,000 expected to test a British one.
Those likely will be divided among Americans and volunteers in other countries such as Brazil or South Africa, Dr. Anthony Fauci of the National Institutes of Health told The Associated Press.
While he’s optimistic, “we’ve been burned before,” Fauci cautioned.
Multiple successes, in multiple parts of the world, are vital.
“This isn’t a race of who gets there first. This is, get as many approved, safe and effective vaccines as you possibly can,” Fauci said.
Vaccine experts say it’s time to set public expectations. Many scientists don’t expect a coronavirus vaccine to be nearly as protective as the measles shot.
If the best COVID-19 vaccine is only 50% effective, “that’s still to me a great vaccine,” said Dr. Drew Weissman of the University of Pennsylvania.
“We need to start having this conversation now,” so people won’t be surprised, he added.
And for all the government promises of stockpiling doses in hopes of starting vaccinations by year’s end, here’s the catch: Even if a shot pans out — and it’s one that your country stockpiled — only some high-risk people, such as essential workers, go to the front of a very long line.
“Will you and I get vaccinated this year? No way,” said Duke University health economist David Ridley.
The home stretch
Vaccines train the body to rapidly recognize and fend off an invading germ. About 15 experimental COVID-19 vaccines are in various stages of human studies worldwide.
And while there’s no guarantee any will pan out, moving three different kinds into final testing offers better odds — especially since scientists don’t yet know just how strong an immune reaction the shots must spark to protect.
Measuring that with the first proven vaccine will “really help us understand for all the other vaccines in development, do they also have a chance?” said Oxford University lead researcher Sarah Gilbert.
Only China is pushing out “inactivated” vaccines, made by growing the new coronavirus and killing it. Vaccines by Sinovac Biotech and SinoPharm use that old-fashioned technology, which requires high-security labs to produce but is dependable, the way polio shots and some flu vaccines are made.
Most other vaccines in the pipeline target not the whole germ but a key piece — the “spike” protein that studs the surface of the coronavirus and helps it invade human cells. Leading candidates use new technologies that make shots faster to produce but haven’t yet been proven in people.
Oxford’s method: Genetically engineer a chimpanzee cold virus so it won’t spread but can carry the gene for that spike protein into just enough cells to trick the immune system that an infection’s brewing.
Another vaccine made by the NIH and Moderna Inc. simply injects a piece of the coronavirus genetic code that instructs the body to produce harmless spike copies that the immune system learns to recognize.
Chasing the virus
Researchers must test thousands of people not where COVID-19 is surging — because then it’s too late — but where it’s smoldering, Fauci said.
Only if the virus starts spreading through a community several weeks after volunteers receive either a vaccine or a dummy shot — time enough for the immune system to rev up — do scientists have the best chance at comparing which group had more illness.
Lacking a crystal ball, the NIH has vaccine testing networks in the U.S., South America and South Africa on standby while finalizing decisions on the summer tests.
“We’re going to be doing it in multiple sites with a degree of flexibility” so researchers can rapidly shift as the virus moves, Fauci said. “Nothing is going to be easy.”
The Oxford shot, with a 10,000-person study underway in England, already encountered that hurdle. Gilbert told a Parliament committee last week that there’s “little chance, frankly” of proving the vaccine’s effectiveness in Britain after infections plummeted with the lockdown.
So her team looked abroad. In addition to the planned U.S.-run study, Brazil last week began a last-stage test of the Oxford shot in 5,000 health workers, the first experimental COVID-19 vaccinations in South America. In another first, South Africa opened a smaller safety study of the Oxford shot.
With few new infections in China, Sinovac next month will begin final tests in 9,000 Brazilian volunteers. And SinoPharm just signed an agreement with the United Arab Emirates; that study’s size isn’t clear.
Expect imperfect protection
Animal research suggests COVID-19 vaccines could prevent serious disease but may not completely block infection. One study that dripped the coronavirus into monkeys showed vaccinated animals avoided pneumonia but had some virus lurking in their noses and throats. Whether it was enough to spread to the unvaccinated isn’t known.
Still, that would be a big win.
“My expectations have always been that we’ll get rid of symptomatic disease. From what we’ve seen of the vaccines so far, that’s what they do,” said Penn’s Weissman.
The initial vaccines might be replaced with later, better arrivals, as historically happens in medicine, noted Duke’s Ridley.
And while shots in the arm are the fastest to make, those for respiratory diseases require virus-fighting antibodies to make their way into the lungs. Gilbert said Oxford eventually will explore nasal delivery.
Warning against shortcuts
Some U.S. lawmakers worry about pressure from the Trump administration to push out an unproven shot during the fall election season.
“We want a vaccine, not a headline,” Sen. Jack Reed, a Democrat from Rhode Island, said at a recent Senate committee hearing.
Dr. Stephen Hahn, commissioner of the Food and Drug Administration, pledged to a House committee last week that any decision would be based on science.
Different countries have different rules about when to release a vaccine. For the U.S., Fauci insisted there will be no safety shortcuts, a key reason NIH is investing in such huge studies.
Regardless of how and when a vaccine arrives, each country also will prioritize who’s first in line as doses become available. Presumably they’ll start with health workers and those most vulnerable to severe disease — as long as each shot is proven to work in at-risk groups such as older adults.
Because each vaccine works differently, “which population group it will protect, we don’t know yet,” said Dr. Mariangela Simao of the World Health Organization, which is advising countries on how to choose.


fortune--2020-06-28--Google gets mixed reviews for its coronavirus aid initiative

A Google program announced with big fanfare three months ago to help businesses survive the coronavirus pandemic is being criticized for the inconsistent amounts of aid it has provided to recipients and its limited financial impact.
The tech giant’s plan, pitched as a way to support struggling ad customers, was to give $340 million in ad credits to small and medium-sized businesses. The company said it wanted to “alleviate some of the cost” of advertising during the pandemic, to help businesses survive the downturn.
But ad agencies that mange the ad budgets for other businesses say that Google’s program, while welcome, hasn’t made much of a difference. The maximum credit that Google is giving advertisers—$1,000—is insignificant when considering that many of them spend hundreds of thousands of dollars with Google annually.
“There was a lot of excitement about it,” Alex Melen, co-CEO and CFO of digital ad agency SmartSites, said about Google’s initial announcement of the program, and before it disclosed the $1,000 maximum award. “And then it was like don’t get too excited. I don’t think $1,000 is going to save anyone.”
For example, Pauline Jakober, CEO of digital ad agency Group Twenty Seven, said one of her clients, a law firm, spent $310,000 last year on Google ads. The law firm ended up receiving a credit of $750, or only about 25% of what it spends on Google ads daily. “The thought was nice, but the execution and what people are getting is interesting,” Jakober said. “That’s a lot of money they’ve given Google in one year, so we were a little shocked.”
Google declined to make Philip Schindler, who oversees Google’s ad business, available for an interview. In a statement, Mary Ellen Coe, who oversees Google’s global ads business for small and medium-sized companies, said: “The COVID-19 crisis has deeply impacted small businesses globally and we designed our [small and medium business] ad credit to reach our small business customers broadly with a gesture of support. We hope this will help to defray some of the cost of re-engaging with their customers at a time that is right for them.”
Google declined to disclose details about how allocates the credits other than they will all be handed out by early July. But five ad agencies that work with Google provided Fortune with glimpse into how the program has been managed.
Those agencies said that the program, announced March 27, got off to a slow start, with only a few of their clients receiving any credits by early June. But starting on June 18, credits for thousands of advertisers started appearing in their online ad accounts.
Clients received credits of $100, $300, $750, or $1,000. Google said the amount would be based on how much the advertisers spent on ads in 2019 and the country in which they were located, but what they received didn’t seem to square with that policy.
Clients with Group Twenty Seven that had spent $100,000 to $586,000 with Google, received $750 in ad credits each. At digital marketing firm Scorpion, however, some clients that only spent $150,000 received more—$1,000.
At JEMSU, another marketing agency, a client that had spent nearly $456,000 on Google ads in 2019 and another that spent $43,000 both received a $750 credit. Meanwhile, clients of SmartSites that spent $10,000 to $100,000 on Google ads last year received the same amount.
“It’s a mystery,” Group Twenty Seven’s Jakober said. “I don’t know what kind of algorithm they’re giving different people to siphon off the money.”
Asked about the inconsistencies, Google said that they’re rare and likely caused by foreign exchange rates. However, most clients working with the five agencies that spoke to Fortune are based in the U.S..
While the ad agencies doubted the ad credits would do much to help recipients avoid financial duress, some clients will likely benefit more than others, they said. For example, one of Scorpion’s clients, which only spends around $400 monthly on Google ads, received a $100 credit. That translates into about 25% of an entire month’s spending on ads.
“It’s not a significant value in the grand scheme of things,” said Daylen Farkas, a vice president at Scorpion, “but I think every bit counts nowadays.”
Google’s ad credit program was part of its larger $800 million coronavirus relief package that, in addition to advertisers, is meant to help a broad swath of recipients. The company said it has allotted $250 million in ad grants to more than 100 government agencies and health groups so they can provide people with information about the pandemic. More than 785 million people have seen those ads, Google said.
Among the recipients was the World Health Organization, which received $30 million in ad grants. So far, the organization has used $13 million of that amount.
Additionally, Google allotted another $200 million to help provide small business loans. So far, the company said it has arranged for $125 million in loans, plus another $45 million announced later, to be distributed by the Opportunity Finance Network, a network of private financial institutions that lend to disadvantaged businesses.
Five financial institutions have already received $15.5 million in loans. More are expected to be announced every month over the next year. A similar $75 million loan program is planned for overseas, using a different partner.
Meanwhile, Google is giving $20 million in credits to researchers and academic institutions to cover the cost of using Google’s cloud data centers. Harvard Global Health Institute, Google’s partner for handing out some of the credits, said it has doled out nearly $7 million so far.
And finally, Google, in partnership with the CDC Foundation, the philanthropic arm of the Centers for Disease Control and Prevention, and safety equipment supplier Magid Glove, shipped more than 3 million masks to 25 health organizations in 14 states and territories.


fortune--2020-06-28--How Goodwill is reinventing itself to ride the pandemic resale wave

At the Goodwill store in downtown Brooklyn last week—the second day after in-store shopping was reinstated in New York City—a steady stream of shoppers milled about while social distancing, taking dresses and blouses off the racks and examining the dinnerware selection, partaking in the treasure hunt shopping they’d been craving for weeks.
While there was new signage on the floor reminding shoppers to keep six feet apart, other touches in the store were a reminder of the larger transformation going on in Goodwill’s locations: clothes were displayed in modern shelving against colorful walls, floors were immaculate and buffed, mannequins in the window were decked out in stylish clothing, and customers had the option to pay by Apple Pay.
“It’s the hunt. You can come here and have a lot of fun, we want this to be inviting,” Katy Gaul-Stigge, the CEO of Goodwill Industries of Greater New York and Northern New Jersey, as the organization’s metro New York affiliate is formally known, told Fortune as she gave us a tour of the store.
Before the pandemic, Goodwill was already modernizing the look of its stores to re-energize a retail business that had grown stagnant in recent years.
And the virus crisis is only adding urgency to those efforts, given the permanent ways COVID-19 is expected to change shopping habits in favor of Goodwill, deepening the so-called “shift to thrift”: last week, a study by research firm Global Data projected that U.S. sales at thrift stores would rise from $21 billion this year to $28 billion by 2024, even as chains like J.C. Penney and The Gap deal with defecting shoppers.
“We wanted to refresh the stores and re-introduce ourselves,” said Gaul-Stigge. That effort has included creating an Instagram presence, teaming up with influencers, and changing the merchandise in stores more often to enhance that “treasure hunt” shopping that consumers love so much today.
The Goodwill NYNJ store in Brooklyn, N.Y. Courtesy: Goodwill
Despite the tailwind thrift retail enjoys, Goodwill is facing more competition from the likes of online resale stores like ThredUp, Poshmark, the RealReal, and off-price retailers; just a block or so away from the Brooklyn Goodwill are bustling Nordstrom Rack and T.J. Maxx stores, which also offer treasure hunt shopping.
Goodwill NYNJ’s 27 stores, which are in greater New York City, Long island, and the Hudson Valley, do a solid business: last year, they took in $43.1 million. But retail sales have been stuck at around that level for several years. (The organization’s $120 million annual budget is filled out by things like grants and donations.) And without events like galas and fundraisers to supplement its mission of helping people—notably those with autism—find work, a healthy retail offering is essential.
“We are following the trends, too. I need as CEO to be making sure we are competitive in the market, because these stores are our fuel, this helps us do the work that Goodwill is known for,” says the 45 year-old, who took the reins of Goodwill NYNJ five years ago after a career in city government. That included most recently a stint as executive director of the New York Mayor’s Office of Workforce Development, which works to help people find employment.
Initially, Gaul-Stigge and her team fiddled around with an idea of rebranding the interior of the stores as “Curated,” with a sleek logo. That look remains at two Goodwill Manhattan stores and one in New Jersey, and is visible in parts of other stores. But she felt, with customer data to back her up, that the hip signage was overpowering the stores’ message of thrift. (Target ran into this same problem a few years ago when it confused customers with hip marketing that made them feel they couldn’t afford its wares.)
“We are making sure value is front and center,” she says. “We want to it be accessible and fun and stay with our core.”
Prior to becoming CEO of Goodwill NYNJ, Gaul-Stigge’s only retail gig had been at the Gap in her first-ever job. So she has surrounded herself with A-list directors from the world of retail, including executives with experience at big chains like Intermix and Coach.
That, she says, is helping her navigate the biggest crisis in retail’s modern history at a time Goodwill’s mission is as hard to carry out as ever, given massive unemployment.
Her approach has been to manage Goodwill as any CEO would manage a retailer, and lean into advantages such as having been vintage before vintage was cool. It helps that any stigma about shopping at Goodwill is evaporating, especially at this difficult economic time. Gaul-Stigge’s dream scenario is for more people to come in to donate quality items (some 50% of donated items are ultimately resellable) and also to shop, up and down the income spectrum.
“When everyone donates and everyone shops at Goodwill, the engine gets stronger,” says Gaul-Stigge.
And she wants to leverage the long head start she feels Goodwill has in resale and the second life it gives a garment, which she says puts the organization in sync with shoppers’ priorities now.
“Here we have a 100 year old ‘sustainable’ organization,” she says.


fortune--2020-06-28--Dark City: Photos of a disorienting New York in lockdown

“It felt like the city was yours. But now, I feel like it’s not anymore. Everyone took it back,” photographer Dina Litovsky tells Fortune.
Litovsky spent three months photographing New York City during its shelter-in-place order. Now that the city’s is in phase 2 of reopening, the world she saw and created is disappearing.
Litovsky’s photographs are typically layered with busy social interactions that she makes sense of in her framing. But as she walked the city during the early stages of the pandemic, going from the East Village to Midtown Manhattan, she was disoriented by the lack of usual chaos in the space. As a New Yorker for 25 years, Litovsky says she’s never seen the city or felt the city in this way.
“It was disorienting to be in such a beautiful space while acknowledging the reason for its emptiness,” Litovsky says.
Instead of focusing on the action of the pandemic that was constantly covered by photojournalists, she was drawn to the cinematic and hypnotic state her city was in. She searched for extreme color, which once eluded her because it was lost in the chaos of everyday life. The bright colors in her images illuminate what the city once was pre-pandemic, and she described the bright spaces as a consistent element in her work as a way “to defy expectations to overcome dark times.”
Litovsky aimed to capture the city’s disoriented state, and she found herself photographing people in between moments, which she describes as “hypnotic.” She says, “All the familiar things lost their function. Parks were no longer for enjoying, surveillance cameras were surveilling nothing, etc.
“I was capturing a very specific world that was alienating and eerie, but that kept disappearing before my eyes as we got closer to the phase one reopening.”
Scroll below to see more images of Dina Litovsky’s “Dark City.” Check out her instagram here.
Dina Litovsky—Redux
Dina Litovsky—Redux
Dina Litovsky—Redux


fortune--2020-06-27--Why it takes so long to count mail-in ballots

Voters in New York cast ballots on Tuesday, June 23, in a variety of state and national primaries. But they’re not expected to know the final outcome of those races until well into next week. States including Kentucky, Pennsylvania, and Georgia are seeing similar delays. That’s largely owing to a surge in demand for absentee ballots as voters seek to avoid the risk of coronavirus infection at the polls, as well as jurisdictions that aren’t well prepared to process them.
Unless decisive action is taken, experts say, the delayed results are just a preview of bigger problems in the upcoming presidential election—and potentially a threat to American democracy itself.
“I think we have to assume there’s going to be long delays [for election results] in November,” says Charles Stewart, a political science professor at MIT who specializes in voting technology. “The worry is that this delay is going to be the source of fomented distrust of the vote-counting process.”
Stewart is alluding to a recent surge of tweets and other statements from, above all, President Donald Trump. The President has repeatedly made false claims that voting by mail increases the risk of election fraud.
To speed up results and protect trust in the process, election officials across the country will need to swiftly address what experts identify as the two main issues slowing down current primary results: outdated technology and equally outdated legislation.
Mail-in ballots are typically processed manually in many of the jurisdictions seeing delayed primary results. But there are also usually far fewer of them. In New York, for example, mail-in ballots are expected to account for a majority of votes in this week’s primary, compared with a normal proportion of around 5%.
Election workers processing mail-in ballots in Reading, Pa., on June 3, 2020. Pennsylvania is among the states scrambling to update election systems to cope with an expected flood of mail-in ballots in the November presidential election. Ben Hasty/MediaNews Group—Reading Eagle via Getty Images
Election workers process those ballots by manually opening envelopes, reviewing voter signatures, and sorting ballots. For the most part, according to Stewart, compensating for the surge in the short term has meant simply hiring more workers.
But to prepare for November, many jurisdictions are hoping to automate more of the process, drawing in part on the robust mail-in voting infrastructure of jurisdictions including Oregon and Washington State. There, much of the process is already automated, with machines used to extract and sort ballots, and even to review signatures.
It remains to be seen, though, how many jurisdictions will be able to adopt those processes. Amber McReynolds, head of the National Vote at Home Institute and a former election official in Denver, is worried that production and supply issues may mean the needed high-tech equipment won’t be available in time, especially if state and local officials are indecisive.
“This is not a July or August decision,” says McReynolds. “That’s something election officials have to make a decision on right now.”
There are also budget constraints: According to Stewart, a single sorting machine can cost roughly a million dollars. While the CARES Act provided about $400 million in additional election funding this year, states have faced barriers in accessing those funds.
The second factor in delayed tallies are rules that, according to experts, unnecessarily slow down the processing of mail-in ballots.
In most states, according to McReynolds, mail-in ballots go through signature review and other verification processes when they’re received, allowing votes to be tallied quickly on election day.
“In Denver, on election night, you’ll see 50% of all results posted right at 7 p.m.,” says McReynolds, “because they’ve processed [mail-in ballots] weeks in advance.”
But in a relative handful of states including Pennsylvania, Michigan, and Wisconsin, rules prohibit even preliminary processing of ballots prior to election day. In New York, officials can’t tally mail-in votes until a week after in-person voting. Though the rules were originally intended to protect election integrity, the rationales behind them are largely no longer relevant.
“The regulations and laws related to mail balloting were designed for the old-fashioned, excuse-required absentee ballot process,” says Stewart. Many absentee voting rules have been modified as a result of the coronavirus, but rules about processing haven’t been updated to match, in part because they’re politically contentious. Legislative efforts to update them by November have gained steam, but are expected to have uneven results.
“I’ve been told there’s likely to be success in Pennsylvania on [revising mail-in ballot rules],” says Stewart. “And in Michigan it’s not going to happen. This is trench warfare—it’s going to be state by state.”
With both practical and political obstacles to quick reform, there’s a good chance that some major battleground states will not have decisive election returns for days, or perhaps weeks, after in-person voting on Nov. 3.
Elaine Kamarck, a senior fellow studying elections at the Brookings Institution and a former Clinton administration official, says this means Americans should adjust how they think about election night.
“We’re accustomed to staying up late for results,” says Kamarck. “Television does a good job of making it very dramatic as the returns come in. This time, that won’t be the case.”


fortune--2020-06-29--The 20 biggest companies that have filed for bankruptcy because of the coronavirus pandemic

The founder of Vice Ventures on addressing diversity and inclusion among VC investors and portfolio brands

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Get ready for a boom—in bankruptcies.
“We are seeing an acceleration in bankruptcies that is unprecedented,” said James Hammond, CEO of New Generation Research, which runs BankruptcyData. For 2020, he says, “I’m pretty confident we will see more bankruptcies than in any businessperson’s lifetime.”
Ranked by assets alone, says Hammond, the magnitude of bankruptcies this year has already surpassed that of 2008. And that’s not including what could happen when the government’s Paycheck Protection Program, which aims to keep small businesses up and running with loans that can be converted to grants if certain terms are met, runs out.
The largest Chapter 11 bankruptcy so far has been that of car-rental company Hertz. Unable to hold on after the travel industry effectively hit the brakes, the company is now selling off much of its fleet in a bid to meet demands from creditors. Others in sectors ranging from oil and gas, to retail, to aviation have similarly suffered in navigating the pandemic.
bankruptcydata
Editor’s note: Chesapeake Energy, an oil and gas company, filed for bankruptcy protection on Sunday. With assets of roughly $16.2 billion and liabilities of $11.8 billion, the filing represents the fourth-largest bankruptcy by assets so far in 2020, above that of Intelsat.
Notably, a Chapter 11 bankruptcy filing means a company is struggling, but doesn’t mean that it will cease operating.
“You have an enormous pile of corporate debt that has been accumulating, which the debt and restructuring world had been concerned about for a couple of years. And all of a sudden, in the space of almost no time at all, investors are asking questions about the ability to service debt,” says Hammond. “[From] 2008 to 2009 was a financial crisis. This is now everywhere.”
By sheer number of bankruptcies, restaurants have been the hardest hit, per rankings from BankruptcyData. Recently, CEC, the company behind restaurant and entertainment venue, Chuck E. Cheese, closed down locations and filed for bankruptcy protection as the coronavirus shuttered restaurants and challenged live-events companies.
Even as the U.S. reopens, Hammond is not optimistic. Bankruptcy filings, he notes, are a lagging indicator. Now, he says, “we are at the waterfall.”


fortune--2020-06-29--The Fed reveals which companies make its corporate-bonds shopping list

The Federal Reserve on Sunday released a list of roughly 750 companies, including Apple, Walmart and ExxonMobil, whose corporate bonds it will purchase in the coming months in an effort to keep borrowing costs low and smooth the flow of credit.
The central bank also said it has, so far, purchased nearly $429 million in corporate bonds from 86 of those companies, including AT&T, Walgreen’s, Microsoft, Pfizer and Marathon Petroleum.
The Fed announced in March that it would, for the first time in its history, purchase corporate bonds as the intensifying viral outbreak caused panicked investors to dump most types of securities in a rush to hold cash. That pushed up a range of interest rates and made it nearly impossible for companies to borrow more by issuing new bonds.
Yet once the Fed said it intended to purchase up to $750 billion of corporate debt, investors began buying bonds again and eventually large companies resumed issuing large amounts of new bonds. Recent economic research has found that simply by announcing the program, the Fed was able to boost confidence in corporate bonds and improve the market’s efficiency.
Fed Chair Jerome Powell has said that by ensuring large companies can borrow more, the Fed is seeking to keep those firms from having to layoff workers. But the corporations aren’t required to keep all their workers.
At a hearing last week, Sen. Pat Toomey, R-Pa., questioned Powell about whether the purchases were still necessary, since the corporate bond market has largely recovered. Powell said the Fed had to follow through on its promises.
To avoid criticism that it might favor a specific industry, the Fed said two weeks ago that it would seek to mimic a broad market index approach and purchase bonds from a wide range of companies. Consumer product companies, such as Quaker Oats and the distiller Brown-Forman, which makes Jack Daniel’s and Woodford Reserve whiskeys, make up roughly a third of the index. That sector is followed by utilities at 10% and energy firms at more than 9%. The index also includes insurance companies but no banks.
The Fed will only buy highly rated debt from financially healthy companies, or ones that were highly rated before the pandemic struck. The Fed is legally barred from lending to insolvent companies. It has said it would report on its purchases every 30 days.
The Fed said Sunday that it made its first bond buys from 86 companies last week. Those companies include Nike, broadcaster Fox Corp., Paypal, Target, Campbell Soup and chipmaker Broadcom.
The central bank is also purchasing pools of bonds in exchange-traded funds, which operate similarly to mutual funds. The Fed currently owns $6.8 billion of bond ETFs.
The Treasury Department has provided $75 billion in taxpayer money to backstop any losses from the bond buys. So far, the Fed’s purchases remain modest relative to the program’s announced $750 billion cap.
By comparison, since March it has purchased more than $2 trillion in Treasurys and mortgage-backed securities in an effort to pump cash into short-term lending markets.


fortune--2020-06-29--The founder of Vice Ventures on addressing diversity and inclusion among VC investors and portfolio

The founder of Vice Ventures on addressing diversity and inclusion among VC investors and portfolio brands

The 20 biggest companies that have filed for bankruptcy because of the coronavirus pandemic

This is an installment in a special series, Startup Year One, interviewing startup founders about the major lessons they learned in the immediate aftermath of their businesses’ first year of operation.
Catharine Dockery grew up in New York City with her father, who was a bartender. So to some degree, she jokes, she’s been in the vice world from a very early age.
When she was younger, Dockery thought she might become a corporate lawyer or work in finance. At New York University she studied a self-designed mix of neuroscience and finance, working on the floor of the New York Stock Exchange, serving as a summer intern at Morgan Stanley, and writing a daily newsletter about current events in the global markets.
Following graduation from NYU, she went into a traditional sales and trading program at Citibank, and despite learning a lot, she found the environment to be a challenging fit. She later worked for Bonobos cofounder Andy Dunn as his chief of staff, eventually following him to a corporate M&A team at Walmart after a $310 million merger in 2017. Not long after, as she was looking for new opportunities, Dockery started developing the thesis behind her own fund.
Vice Ventures celebrated its first anniversary on June 27. Since launch, the firm has closed over $25 million with limited partners like Marc Andreessen and Bradley Tusk. As founding partner of Vice Ventures, Dockery has invested in premier vice brands like CBD beverage Recess and sexual wellness company Maude.
Fortune recently spoke with Dockery to learn more about the firm’s first year in business, the lessons learned, the hurdles overcome, and plans for the next year.
The following interview has been condensed and lightly edited for clarity.
Catharine Dockery, founder of Vice Ventures. Courtesy of Vice Ventures
Fortune: What inspired you to launch your own venture capital firm? What does it even take to start one from the ground up?
Dockery: I think a lot of it for me was conviction in the thesis and the rapidly building momentum behind it. I had some really great interviews for investment roles at consumer venture funds. At the very same time, I was working with a few outstanding vice founders and their teams, giving informal advice and also working with my network to raise capital.
To start a fund from the ground up is an incredibly daunting task, but in this case, it really felt like the thesis was so differentiated that it lent a significant sense of momentum to the idea. That’s not to say it was easy [fundraising]. I sent thousands of cold emails and really pounded the pavement to find investors who connected with the idea and were enthusiastic about our plans for execution. At the same time, I really invested significant effort toward building my knowledge in the space and growing my reputation as an expert on all things vice.
Recess is a sparkling water infused with hemp extract and adaptogens for balance and clarity. Courtesy of Vice Ventures
Vice Ventures has a very targeted group of brands in which it invests. Can you explain more about what you’re looking for in a potential investment? What does a founder/entrepreneur need to do to impress your team?
A significant amount of my prior investment experience comes in consumer brand investing. Vice brands historically have had some of the strongest consumer connections—think Mad Men and cigarettes, for example—and brand strength is a real factor in sales, distribution, and of course exit opportunities.
Another aspect we spend quite a bit of time on is connecting with the founding team. We’re looking for founders who are intellectually honest with themselves, who can build and iterate their brands in a responsible way, and in doing so build toward a strong product-market fit. Vice companies especially need strong founding teams, given that they are heavily regulated and operating in socially delicate fields.
Even a few months ago, no one could have predicted the current financial climate that we’re in. With unemployment breaking records and an economic slump, what has the funding landscape looked like over the past several weeks? And how are your portfolio brands handling the downturn?
The broader funding landscape has definitely been somewhat challenging. That being said, the money that investors allocate to VC tends to be slightly less cyclical than other investments.
Another factor that plays into Vice Ventures specifically has been the success we’ve seen in our existing portfolio as the world navigates COVID-19. We see vice as a field that, if anything, has some countercyclical tendencies. The challenging overall financing environment has, for Vice Ventures, really been outweighed by investors who are excited by the portfolio’s early performance and the strength of the fund thesis.
Lucy is a nicotine alternative. (Reminder that nicotine is an addictive chemical.) Courtesy of Vice Ventures
It’s no secret that there are few women in the VC field. What is your firm doing differently to encourage and support not only female founders but also BIPOC founders within your portfolio now and in the future?
The first thing I’d like to say here is that I think it’s absolutely tragic that these groups have had so many social obstacles to success. We all have a responsibility to be mindful of these injustices—both in the past and the future.
One thing I’m incredibly proud of is the composition of our existing portfolio and the continued diversity of our deal pipeline. Our founders come from an incredible variety of backgrounds, with many of them being women, BIPOC, or both. While we don’t believe in creating hard-and-fast portfolio composition guidelines—either for sector mix (alcohol equals 20% of portfolio, for example) or for founders—we absolutely are looking to build.
In terms of other work we are doing, we are incredibly proud of the effort made by our portfolio companies to support diversity and inclusion, and we actively support their action there. I’ve also been quite active personally supporting charities in the space such as the ACLU, the Drug Policy Alliance, and the Last Prisoner Project.
Another source of content I’ve written here is the Medium post I put out recently on social equity aspects of cannabis legalization.
Looking ahead to five years from now (hopefully post-pandemic times), where do you see Vice Ventures? How do you want to grow your firm, and what do you want to achieve by then?
Five years from now, I see Vice Ventures expanding beyond seed stage investments into later rounds. I’d like to see some significant outperformance from our Fund 1 investments by that point, and really expect to see our portfolio meaningfully outperform.


fortune--2020-06-29--A Food Crisis of ‘Biblical Proportions’

A Food Crisis of ‘Biblical Proportions’

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Good morning.
COVID-19 could bring a food crisis of “biblical proportions” to Africa, which is already suffering from changing weather patterns and a plague of locusts, World Food Program head David Beasley told the UN recently. Beasley’s warning has prompted action from at least one company—Yara, the global fertilizer giant based in Norway (and featured on Fortune’s Change the World list.)
Yara CEO Svein Tore Holsether told me Friday the company has committed $25 million to provide food to a million people in the region. Africa is a small part of Yara’s business—less than 5%. “From an economic and reputation standpoint, it is probably better not to be in Africa at all,” he said. “But our mission is to responsibly feed the world and protect the planet.” With that as the company’s purpose, how can starvation in Africa be ignored?
Some might ask whether Africa’s problem is better left to the WFP and other aid organizations. But Holsether believes public-private partnerships are essential. “The focus of foreign aid is to help the immediate problem. But unless we do something to address the longer term,” problems will keep reoccurring. By providing both premium fertilizer and a digital knowledge platform to as many as 250,000 smallholder farms, Holsether thinks Yara can help triple their yields and find markets for their products. He is encouraging other global companies to support the effort. If you are interested in participating, reach out to him: svein.tore.holsether@yara.com.
Separately, while Juneteenth has passed, the effort to make it a paid holiday in the U.S. continues. Teneo CEO Declan Kelly told me last night that he’s teaming up with the advocacy group Global Citizen and celebrities including Pharrell Williams and Ellen DeGeneres to launch a pledge drive, starting this morning, to get U.S. companies on board. “This requires leadership from CEOs to make it happen,” Kelly said. Companies already committed, according to Kelly, include Airbnb, Adidas, HP, The J.M. Smucker Co., Starbucks and Under Armour.
Tomorrow is also the final day to nominate someone for Fortune’s 40 under 40 list. Submit your suggestions here.
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
10 million
Coronavirus cases have topped 10 million worldwide, and the U.S. numbers are rising fast, with more than 42,000 cases on Saturday alone. Florida, Texas, California, and Arizona are responsible for much of the recent rise, helping the U.S. account for an estimated quarter of total worldwide cases. Plus, those numbers likely understate the true scale of the pandemic. WSJ
EY faces Wirecard Questions
EY is bracing for difficult conversations from its clients after Wirecard, the German payments company it was in charge of auditing, filed for insolvency protection last week amid an escalating financial fraud investigation. FT
Facebook Boycott
The organizers behind a Facebook advertising boycott say the movement is about to go global. They're asking companies to pull their worldwide ads on the platform, not just their U.S.-based advertising. That movement is already picking up steam, with companies including Verizon and Unilever onboard. The campaign is intended to pressure Facebook into stricter standards over hate speech. Reuters
Shale bankruptcy
Chesapeake Energy, which devised the playbook for exploiting the U.S. shale fields, has filed for bankruptcy. The company has a dramatic history, expanding fracking dramatically in North Texas, taking on a high debt load, and expanding into real estate, from a church to a shopping centre. It was also facing the plunge in commodities prices due to the pandemic. It's the second shale company to do so—Whiting Petroleum filed earlier this year. Fortune
AROUND THE WATER COOLER
Nuctech pressure
Several U.S. agencies are attempting to pressure European governments into uprooting Nuctech, a state-controlled Chinese company baggage screening company that is expanding across the continent's airports and ports. The effort bares some similarity to pressure over other governments' contracts with telecomm giant Huawei. WSJ
'More idiotic rubbish'
The U.K. has altered its two-week quarantine measures for those arriving in the country—giving arrivals from France, Spain and Greece (and perhaps others) a pass. That's drawn another rebuke from the budget carrier Ryanair, which called the plan 'more idiotic rubbish'. The carrier is expected to operate 1,000 flights from July 1. Bloomberg
Outdoor Voices CEO
Outdoor Voices, the formerly ascendant athleisure brand, was struggling even before the pandemic. Financial losses and employee revolts over the management style of founder Ty Haney had resulted in her ouster, writes Fortune's Emma Hinchcliffe, and then COVID-19 hit. Now, the company has a new CEO, Ashley Merrill, with the mandate to turn the business around. "Outdoor Voices was part of that period of time when businesses were approaching business from a growth-at-all-costs perspective," she told Emma. Fortune
SafeLite
When the financial crisis hit in 2008, SafeLite, the windshield maker, managed to come out strong. Earlier this year, the company was celebrating the ensuing years of growth—and then the pandemic hit. Fortune's Shawn Tully talked to CEO Tom Feeney about how the company got back to pre-pandemic levels even as some states are locking down once again. Fortune
This edition of CEO Daily was edited by Katherine Dunn.


fortune--2020-06-29--China’s military approves coronavirus vaccine for its own use

Chinese troops will be among the first to get jabs of one of China’s leading COVID-19 vaccine candidates.
On Monday, the Chinese biotech firm CanSino Biologics said in a statement to the Hong Kong stock exchange that China’s Central Military Commission gave the go-ahead for China’s military to inject soldiers with Ad5-nCoV, the company’s leading vaccine candidate, for a period of one year.
In the statement, CanSino Biologics chairman Yu Xuefeng said the vaccine candidate’s Phase I and II clinical trials demonstrated a “good safety profile” and high levels of immune response in patients. But he cautioned that the trials only show that the vaccine has the potential to prevent COVID-19 and that the military’s approval of the vaccine does not guarantee it will be authorized for broader commercial use in future.
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CanSino Biologics has been developing the vaccine in conjunction with the Academy of Military Medical Sciences, a medical research institute run by the People’s Liberation Army. The two organizations are basing the experimental COVID-19 vaccine on their previous collaboration on an Ebola vaccine. The Chinese government approved the Ebola vaccine for widespread use in 2017.
CanSino’s Ad5-nCoV candidate has long been China’s leading COVID-19 vaccine candidate, after it became the first in the world to begin clinical trials on March 16. The company conducted Phase I and II trials in Wuhan, China, and published the results of the trials in The Lancet medical journal.
In mid-May, CanSino also announced a partnership with the National Research Council of Canada and got the green light to begin clinical trials with Canadian patients. The trials are being conducted over a six-month period in partnership with researchers at Dalhousie University in Halifax, Nova Scotia.
Two other China-based COVID-19 vaccine projects—one developed by state-owned Wuhan Institute of Biological Products and the other by Beijing-based biotech firm Sinovac—entered human testing earlier this year, making them some of the world’s most promising candidates.
As of Sunday, the World Health Organization said 17 COVID-19 candidate vaccines were in clinical evaluation, with another 131 in preclinical stages. The global scientific community is working at an unprecedented speed to develop an inoculation against COVID-19, which has infected more than 10 million people and killed more than 500,000 globally in the worst public health crisis in a century.
Yu founded CanSino Biologics in 2009, and its investors include Chinese venture capital firms such as Qiming Venture Partners and Lilly Asia Investors.
CanSino Biologics’ stock traded 5% higher on the Hong Kong stock exchange on Monday morning before returning to its Friday closing price by Monday afternoon. The company’s market capitalization has more than tripled to $5.3 billion since the start of the coronavirus pandemic. On Jan. 2, 2020, the company’s share price was HKD 59, and on Monday it closed at HKD 219.


fortune--2020-06-29--A foiled attack on Pakistan’s stock exchange leaves four gunmen dead

Pakistani security officials killed four gunmen in Karachi before they could enter the stock exchange building with automatic rifles and hand grenades.
The attackers were not able to enter the main compound, Farrukh Khan, chief executive officer of the exchange said by phone. The situation is under control now, said Khan. The KSE 100 index, which dropped after news of the attack, gained 0.4% at 12:59 p.m. in Karachi.
“There was very heavy firing,” said Abid Ali Habib, chief executive officer at Aba Ali Habib Securities Pvt. who was in his office on the fourth floor. “We decided to close our office doors with no movement inside or out.”
Terrorists opened fire when security officials were checking their car, according to Habib. The stock exchange is located at one end of I.I. Chundrigarh Road, home to the central bank, and headquarters of most major banks in the nation.
One policeman and two exchange security guards were killed, senior police officials said on local TV, in what was the worst terrorist attack in Pakistan’s financial hub in two years. The incident mirrors an attempted raid on the Chinese consulate in the city in 2018 that killed at least seven people.
Authorities found bullets and food items with the terrorists, Geo TV reported.
“It seemed to be a planned hostage situation that was stopped,” said Ikram Sehgal, a former military officer and chairman of Pathfinder Group, Pakistan’s largest private security company. “There will be more such attacks.”
Baluchistan Liberation Army has claimed responsibility for the attack, the Associated Press reported. The militant group has been demanding independence for Baluchistan province, which is rich in gas.
The exchange compound has two main buildings with one for stock exchange management and another for brokerage houses. Security officials have evacuated the building to check for other attackers.
“I was a minute away when I got a call from the office about the attack,” said Zafar Moti, head of Zafar Moti Capital Securities Pvt. He decided not to head into office.


fortune--2020-06-29--Global markets fall as COVID cases hit a grim new milestone

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Happy Monday. It’s a risk-off morning as COVID-19 cases hit yet another grim milestone. Investors are selling as the rise in infections, mostly in the Americas, accelerates, dashing hopes for a rapid global economic recovery.
Let’s check in on the action.
Markets update
Asia
In afternoon trade, the Asia indexes are bombing, with Tokyo’s Nikkei down more than 2% .
down more than . China is sending a blunt message to the U.S.: butt out of our domestic affairs or the Phase One trade dea l will be in jeopardy .
is sending a blunt message to the U.S.: butt out of our domestic affairs or the l will be . On cue… In a page pulled from the Huawei playbook, the U.S. is pressuring allies to stop doing business with Nuctech, a cargo- and luggage-screening specialist that has a big presence at European airports and ports.
Europe
The European bourses started the week on a down note with the Stoxx Europe 600 falling 0.2% at the open.
started the week on a down note with the falling at the open. “More idiotic rubbish”… That’s what Ryanair thinks of the U.K.’s move to relax its controversial quarantine rules for travelers arriving from select European countries.
thinks of the U.K.’s move to relax its controversial for travelers arriving from select European countries. What’s this? Positive sentiment around Brexit? The EU and Britain enter an intense period of negotiations today, and there’s more optimism these days they could finally agree to a trade deal.
U.S.
The major averages closed Friday down for the week as a spike in coronavirus cases spooked investors. Here’s how they fared: the Dow ( -3.3% last week) S&P 500 ( -2.9% ) and the Nasdaq ( -1.9% ).
( last week) ( ) and the ( ). Facebook‘s woes continued over the weekend. Starbucks joined big-name advertisers Patagonia, Diageo, Verizon, Ben & Jerry’s and Coca-Cola in pausing their ad spend on the social media platform as the “#StopHateforProfit” campaign gathers steam. The pull-back has cost Mark Zuckerberg about $7 billion as shares crashed on Friday.
about as shares crashed on Friday. Fracking pioneer Chesapeake Energy Corp. filed for Chapter 11 bankruptcy this weekend, one of the biggest casualties of the collapse in energy demand.
Corp. filed for this weekend, one of the biggest casualties of the collapse in energy demand. The week-ahead calendar: Case-Shiller home price index (Tuesday); Consumer confidence index (Tuesday); FOMC minutes (Wednesday); the June nonfarm payrolls report (Thursday) and Eurozone unemployment (Thursday); Independence Day holiday observed; U.S. markets closed and no Bull Sheet (Friday).
Elsewhere
Gold is up.
is up. The dollar is down.
is down. Crude is falling as well. Brent is down about 1%, trading at roughly $40/barrel.
COVID-19 timeline
For the second time in the past three weeks, the Dow and S&P fell last week as investors could no longer ignore the bleak coronavirus numbers. Since Memorial Day (May 25), U.S. states, particularly in the South and West, have hit one new infection record after another. Gone are the mission-accomplished open-for-business pronouncements from May. They’ve been replaced by the unthinkable: re-closing orders. In towns and cities across the United States, this will be the first time in anyone’s memory that Independence Day will feature closed beaches, canceled parades and fireworks shows, plus shuttered bars and restaurants.
Calling off summer fun will have a significant impact on the U.S. economy.
It’s not just the U.S., of course. Regional outbreaks and infection clusters are being reported from Australia to Europe. And over the weekend, we hit another brutal milestone: 10 million confirmed cases worldwide since the start of the outbreak.
If you’re like me, you probably find the numbers both numbing and a bit abstract. 10 million sounds bad. But how bad is it, exactly? I went through the data this morning and built a short timeline. One of the big shockers to me: the first COVID death was declared less than six months ago. As of yesterday, there are more than 500,000.
The WHO reported another scary data point this weekend: the most global infections in a single day. It’s the nature of pandemics to speed up and march from town to town, city to city. And we’re seeing that with COVID. It took roughly three months to go from zero to 1 million infections. Now, we’re seeing roughly 1 million new cases per week. By the end of the summer, we’re on pace for the case load to double again.
It’s a public health issue. It’s a political issue. It’s a markets issue. And, first and foremost, COVID is a societal issue. It’s a crisis that will linger long after the numbers start to show some improvement.
***
Postscript
My wife and I managed to find summer camp options for our girls this week. As is the case in much of the world, Italy has severely limited—if not outright canceled—kids’ summer activities. If you find one, you have to book well in advance and even do a bit of haggling with the organizers to secure a space for your kid in these numbers-restricted programs.
My one daughter is down in Rome, in a stifling gym, at gymnastics camp. The other is attending a weeklong science-and-nature camp with her cousin in Perugia. My 8-year-old niece, always the sharpest person in the room, attended the camp last week and explained to me how it works.
Niece: In our group, there are seven kids. That’s it. And we have to stay at least one meter apart from each another at all times.
Me: How do you keep Italian kids one meter apart at all times?
Niece: We all have a bracelet. It buzzes if you get too close to another child.
Me: Does it work?
Niece: Yes, but we figured out how to disable it.
Me: 🙄
***
Have a nice day, everyone. I’ll see you here tomorrow.
Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com
A note from my Fortune colleagues on a timely new initiative:
Many companies are speaking out against racial injustices right now. But how do they fare in their own workplaces? Black employees in the corporate world, we want to hear from you: Please submit your anonymous thoughts and anecdotes here. https://bit.ly/WorkingWhileBlack
As always, you can write to bullsheet@fortune.com or reply to this email with suggestions and feedback.
Today's reads
When's a good time to sell? After Friday's big drop, and more bad news yesterday of global COVID cases surpassing 10 million, it's perfectly reasonable to review your buy/hold strategy. The market is particularly volatile at the moment. But is now really a good time to cash out? Ben Carlson of Ritholtz Wealth Management is getting this question a lot from clients. Here's what he tells them.
Global demand for America's debt. I'm old enough to remember when Europeans, back in 2007 and 2008, in the run-up to the global financial crisis, couldn't get enough of American sub-prime mortgage debt. Now, Europeans (and Asians, too) are eager buyers of a different kind of American debt—America's corporate debt. On paper, it's a far less risky investment as the Fed is backstopping a good chunk of those corporate bonds. If they were smart enough to jump into the corporate bond market in March, they would have made a killing by now, the Wall Street Journal points out.
Forty under 40. Yes, this is a repeat post... This year we're asking readers to nominate a worthy candidate to Fortune's annual Forty under 40 list. If you have somebody in mind, we want to hear from you. Submit a name here.
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Market candy
-39.5%
Tomorrow is the last day of June, and the last day of the quarter—Q2. There hasn't been a second quarter like this one in anybody's memory. We came into it with economists predicting a Great Depression-era drop in GDP. How bad has it been? We won't get the official number for a few weeks, but the Atlanta Fed has a running daily tally of GDP. On Thursday, it was a staggering -46.5%. This morning it was a somewhat better -39.5%. Pretty bad.


fortune--2020-06-29--Fracking pioneer Chesapeake Energy files for bankruptcy

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Chesapeake Energy Corp., the archetype for America’s extraordinary shale-gas fortunes, filed for bankruptcy, becoming one of the biggest victims of a spectacular collapse in energy demand from the virus-induced global lockdown.
The Oklahoma City-based company filed for Chapter 11 protection from creditors in U.S. Bankruptcy Court in the Southern District of Texas on Sunday, listing assets and liabilities in the range of $10 billion and $50 billion, and more than 100,000 creditors.
The company also entered into an agreement to eliminate about $7 billion in debt and secure $925 million in debtor-in-possession financing.
“We are fundamentally resetting Chesapeake’s capital structure and business to address our legacy financial weaknesses and capitalize on our substantial operational strengths,” Chief Executive Officer Doug Lawler said in a statement.
Chesapeake is, to a certain extent, victim of the success both it and its peers had in extracting huge volumes of gas from previously hard-to-exploit shale basins. While that turned the U.S. into a global supplier of the fuel to rival any other, it also contributed to a glut that weighed on prices. Natural-gas futures in New York traded last week at a 25-year low.
But the gas market is only part of the story. Earlier in its history, under the direction of its late co-founder Aubrey McClendon, a colorful and outspoken advocate for the natural gas industry, Chesapeake expanded aggressively. The heavy debt load it acquired in the process was a burden it ultimately couldn’t shake off.
About a decade ago, Chesapeake was a $37.5 billion giant at the forefront of the fracking revolution that transformed the U.S. oil and gas industry. The company cut eye-popping checks to Fort Worth businesses and residents as inducements to drill on their land in the Barnett Shale of North Texas, America’s first shale field to hit the big time.
U.S. natural gas slumped after the 2008 financial crisis as the frackers overwhelmed demand, and prices still haven’t revisited their previous highs. Investors soured on Chesapeake, which by that point wasn’t only debt-laden but saddled with a real estate empire that included shopping centers, a church, and a grocery store. McClendon was ousted in 2013 and died in an auto accident three years later.
In subsequent years, management sought to compensate for the decline in its gas fortunes by shifting into oil exploration as fracking turned the U.S. into the world’s largest producer of crude as well as a major exporter. However, any optimism about that strategy evaporated with oil’s recent price collapse amid the Covid-19 pandemic.
Despite the company’s efforts over the years to address leverage and profitability, “the recent and dramatic drop in commodity prices and resulting tightening of the credit markets have frustrated the Debtors’ ability to further deleverage absent a chapter 11 proceeding,” Chief Financial Officer Domenic J. Dell’Osso said in a declaration in support of the bankruptcy filings.
Lawler took over Chesapeake in 2013 with an aim of reducing its debt load that was larger than Exxon Mobil Corp.’s, a company 29 times Chesapeake’s market value at the time. He had counted on capital spending cuts and asset sales to cover debt obligations. The company was in talks last year with Jerry Jones, the billionaire Dallas Cowboys owner, about a $1 billion sale of shale assets, but no deal resulted.
In May, Lawler was forced to discard his company’s full-year outlook and write down the value of $8.5 billion in assets as energy demand tumbled amid the Covid-19 lockdown. By then, the producer’s market value had dropped to less than $200 million. The company had about 2,300 employees at the end of last year.
“Despite having removed over $20 billion of leverage and financial commitments, we believe this restructuring is necessary for the long-term success and value creation of the business,” Lawler said Sunday.
The bankruptcy follows that of another highflier in the U.S. oil patch, Whiting Petroleum Corp., which filed for Chapter 11 at the start of April after championing what was once the premiere U.S. shale field, the Bakken of North Dakota.


fortune--2020-06-29--Swarms of locusts descend on India’s biggest sugarcane region

A fresh swarm of desert locusts has entered Uttar Pradesh, India’s biggest sugarcane grower, via capital city Delhi and the northern state of Haryana, according to the federal farm ministry.
Operations to control the grasshoppers are in full swing in the states of Rajasthan, Madhya Pradesh, Uttar Pradesh, Haryana, Gujarat, Punjab and Maharashtra, the ministry said in a statement late Saturday. Tractors, fire engines and drones are engaged in spraying pesticides to kill them, it said.
A massive locust attack adds another challenge for Prime Minister Narendra Modi’s administration, which is trying to contain the spread of the coronavirus and limit its impact on the economy. It cannot risk food crops getting destroyed as millions of people have been pushed into poverty after losing their livelihoods due to the world’s most stringent stay-at-home rules. While movement restrictions are being relaxed, India has become the fourth country with more than 500,000 infections.
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The hoppers, which normally settle on trees during the night and fly during the day, have been controlled in about 127,225 hectares (314,379 acres) of area across the country between April 11 and June 26, the ministry said. Farmers grow mainly rice, pulses, cotton, sugarcane and soybeans on about 106 million hectares during the monsoon season between June and September.
A farmer shows a dead locust found in his field as locust swarms currently plague large zones in the country at Badra Sonauti village on the outskirts of Allahabad in India on June 10, 2020. SANJAY KANOJIA—AFP/Getty Images
In January, the biggest locust swarm to hit India’s western state of Gujarat in over a quarter of a century resulted in more than 25,000 hectares of wheat, rapeseed, cumin and potatoes being attacked, with at least a third of the crops damaged in 75% of the affected areas. About 403,488 hectares had to be treated with pesticides across the country after another invasion in 2019-20, according to the farm ministry.
Desert locusts often attack North Africa, the Middle East and South Asia, usually when heavy rains follow droughts. They generally enter the desert areas of India via Pakistan for breeding during the four-month rainy season that starts in June. But, this year, pink adult swarms were reported as early as April in Rajasthan and Punjab, according to the farm ministry.


fortune--2020-06-29--Starbucks pauses all social media ads as activists call for Facebook boycott

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Starbucks is the latest company to say it will pause social media ads after a campaign led by civil rights organizations called for an ad boycott of Facebook, saying it doesn’t do enough to stop racist and violent content.
Starbucks said Sunday that its actions were not part of the “#StopHateforProfit” campaign, but that it is pausing its social ads while talking with civil rights organizations and its media partners about how to stop hate speech online.
The coffee chain’s announcement follows statements from Unilever, the European consumer-goods giant behind Ben & Jerry’s ice cream and Dove soap; Coca-Cola; cellphone company Verizon and outdoors companies like Patagonia, Eddie Bauer and REI; film company Magnolia Pictures; jeans maker Levi’s and dozens of smaller companies. Some of the companies will pause ads just on Facebook, while others will refrain from advertising more broadly on social media.
In response to companies halting advertising, Facebook executive Carolyn Everson said earlier this week the social networking platform is committed to purging hateful content from its services.
“Our conversations with marketers and civil rights organizations are about how, together, we can be a force for good,” said Everson, vice president of Facebook’s global business group.
Facebook’s market value dropped Friday by more than 8%, or about $50 billion, as more companies said they would pause ads. Twitter stock also dropped more than 7% Friday.
Sarah Personette, vice president of global client solutions at Twitter, said Friday the company’s “mission is to serve the public conversation and ensure Twitter is a place where people can make human connections, seek and receive authentic and credible information, and express themselves freely and safely.”
She added that Twitter is “respectful of our partners’ decisions and will continue to work and communicate closely with them during this time.”