fortune--2020-07-14--Indian billionaire Mukesh Ambani passes Elon Musk to become world’s 6th richest person

India’s richest man surged past Silicon Valley tech titan Elon Musk as well as Alphabet Inc. co-founders Sergey Brin and Larry Page to become the world’s sixth-richest person.
The chairman of Reliance Industries Ltd., whose wealth surpassed Warren Buffett’s last week, is now worth $72.4 billion, according to the Bloomberg Billionaires Index. Shares of the conglomerate have more than doubled from a low in March as its digital unit got billions in investments from companies including Facebook Inc., Silver Lake and, most recently, Qualcomm Inc.
Mukesh Ambani’s energy empire is slowly shifting to e-commerce, with tech giants seeking to take a piece of India’s fast-growing digital business. The world’s second most-populous nation has seen a spike of foreign interest in its economy, especially from Silicon Valley, and Google said on Monday it will spend $10 billion in the coming years to help accelerate the adoption of digital technologies in the country.
After a drop in U.S. tech shares on Monday, Page’s fortune now stands at $71.6 billion, while Brin’s is at $69.4 billion and Tesla Inc.’s Musk is worth $68.6 billion. Buffett’s net worth dropped last week after he gave away $2.9 billion to charity.


fortune--2020-07-14--Casino stocks soar as world’s gambling capital eases travel restrictions

Google in talks to invest $ 4 billion in India ’ s high-flying Jio Platforms

Casino stocks rallied as the easing of some Chinese travel restrictions for Macau sparked optimism of a revival in the world’s largest gambling hub.
China’s Guangdong province agreed to lift quarantine requirements for travelers returning from neighboring Macau, making it easier for gamblers to cross the border. Galaxy Entertainment Group and Sands China Ltd. rose more than 4% in Hong Kong on Tuesday, leading gains on the Hang Seng Index. Wynn Macau Ltd. was up as much as 16%, set for its best day since 2011. SJM Holdings Ltd. and Melco International Development Ltd. increased at least 6% as of 10:24 a.m.
JPMorgan Chase & Co. expects gross gaming revenue to improve to 20%-25% of 2019 levels following the border opening with further relaxing of travel restrictions expected. That could include allowing residents to skip 14-day quarantine measures when entering borders outside of Guangdong from Macau.
“We expect some pent-up demand to materialize in Macau fairly rapidly as travel restrictions come down,” Sanford C. Bernstein analyst Vitaly Umansky said in a note. While people coming from outside Guangdong will still have a hard time visiting Macau, “the overall trend is moving in the right direction.”
Bloomberg Intelligence Index for Macau casinos surged as much as 12%. U.S. casino stocks rallied overnight with MGM Resorts International up as much as 6.8%, and Melco Resorts & Entertainment’s U.S. shares jumping 18%.
The agreement with Guangdong, announced on Monday, will remove the 14-day quarantine requirement put in place by the province in late March to stem the coronavirus pandemic. That measure effectively cut off Chinese travel to the gambling enclave, leaving baccarat and roulette tables virtually empty.
The restriction will be lifted on July 15 at 6 a.m. local time. Travelers will still need to get a virus test before they go.
The easing of restrictions should provide much-needed relief to Macau’s casino industry, which saw gaming revenue plunge by more than 90% for three straight months as the highly infectious pathogen forced countries to shut borders. The lifting of quarantine requirements will now allow high-roller Chinese gamblers, the enclave’s lifeblood, to return freely.
Macau’s gross domestic product, heavily reliant on the tourism and gaming industry, shrank 49% in the first quarter of this year. Even though casino operators reopened after an unprecedented 15-day shutdown in February, travel curbs meant tourists and high rollers couldn’t get there. Morgan Stanley estimated that the industry is losing $15 million daily in expenses.
The casino takings could recover gradually to about 15% to 25% of the pre-Covid level in the near germ, given only Guangdong province, which accounts for about 40% travelers into Macau, will be reopened and no re-issuance of the travel visa yet, said Credit Suisse gaming analysts led by Kenneth Fong in a note Monday.
“Macau government has been actively working with the Zhuhai government to resume the traffic flow,” the note said, “But the progress has been slow with the resurgence of new cases in Hong Kong.”
While Macau has largely contained the coronavirus outbreak and just got good news of border relaxation, neighboring Hong Kong is tightening virus measures to limit social gathering. Schools have been ordered into an “early summer holiday,” while restaurants and bars limit the number of patrons. Events including Hong Kong’s week-long book fair and the champion awards dinner by the Jockey Club have been canceled, and Walt Disney Co. said on Monday that it was temporarily shutting down Hong Kong Disneyland on July 15.
Investors and analysts are hoping China will now take further steps to ease the resumption of visitor flow, including lifting its freeze on the individual and group tourist visas that middle-class Chinese use to travel to Macau.
Macau has detected only a handful of coronavirus cases since April.
“We would expect that if the new policies are implemented well for some time with no contagion, the travel restrictions will continue to be loosened,” Bernstein’s Umansky said.
With the border relaxation as the first positive step of easing policies, analysts now have higher hopes for the National Day Holiday in October to bring back traffic. Citigroup Inc. expects the golden week, which is still about 10 weeks away, will be a positive driver for Macau visits, as there’ll still be limited safe travel destination options for Chinese visitors at that time.
“We remain hopeful that this Golden Week will be more “Golden” than usual for Macau if more non-Guangdong provinces and Hong Kong are added to the bubble before the Golden Week starts,” George Choi, a Hong Kong-based analyst at Citigroup Inc., wrote in a note after the government announcement.


fortune--2020-07-14--Busch Light Apple lampoons iPhone-maker in new commercial

How coronavirus could lead to an unexpected kind of diversity

Hold my beer, Apple fans.
Busch brewery on Monday introduced a limited edition beer called Busch Light Apple along with a commercial (see below) that parodies the high-profile events held by tech giant Apple to unveil its iPhones and iPads. Apple’s unabashed self-promotion and innovation-speak during its events make them ripe for mockery.
In its ad, Busch’s mascot, Busch Guy, a bearded man in jeans and a flannel shirt—spiffed up for the occasion in a sport coat—steps onto an all-black stage and bows to an effusive crowd. He describes Busch as “a thought leader for cutting edge innovations” while holding a slideshow presentation clicker.
“Today, after decades of honing the perfect module, we’re making the biggest leap in modern refreshment since our revolutionary Busch Bavarian,” says Busch Guy.
“Meet our newest product,” Busch Guy continues, calling it a “groundbreaking advancement in beerology.” The audience cheers at the reveal as it invariably does for upgraded iPhone software, new Apple Watches and next-generation Mac computers.
Busch posted the Apple-ribbing promotion across social media, including on YouTube, Twitter, and Facebook after teasing it last week.
It’s time to crack open a revolution. Watch as Busch Guy introduces #BuschLightApple to the world. AVAILABLE FOR A LIMITED TIME ONLY IN SELECT MARKETS. pic.twitter.com/BdKO3uWwMx — Busch Light Apple (@BuschBeer) July 13, 2020
Many of Busch’s limited edition runs are merely cosmetic. In recent years the brewery put out can redesigns featuring the Big Buck Hunter video game, corn, and a tongue-in-cheek Busch Latte.
Busch Light Apple is, on the other hand, a new drink. The brew is a crisp, Apple-flavored light lager. (Note: It’s not a cider.)
Busch says its beer will be available in across nearly half of the U.S. through October. People can visit the “find a store” search page on Busch’s website to find out which locations will carry the drink.
At the end of its Apple-jabbing ad, Busch Guy explodes from his temporary nerdiness by tearing off his sleeves and cracking open a can. The head of a bear growls in the background, a nod to the typical testosterone-heavy imagery of beer commercials. (The closest thing during an Apple event is a 3D technology that transforms executives’s faces into pandas.)
Even teetotalers can appreciate the irreverence.


fortune--2020-07-14--Black Lives Matter is 7 years old. It’s already changed the country forever

Hey, folks. It’s raceAhead editor Aric Jenkins tagging in for Ellen today.
A remarkable headline flashed across my screen the other week: “Black Lives Matter May Be the Largest Movement in U.S. History.”
The article, published in the New York Times, cited polls from several data science and research firms. Each polling period covered about a week, give or take a few days, in early to mid-June. They placed the amount of people protesting in the U.S. at anywhere from 15 million, about 6% of the adult population (Pew), to 26 million, or roughly 10% of adults in the U.S. (Kaiser Family Foundation).
The professors who spoke with the Times for the story were astonished.
“I’ve never seen self-reports of protest participation that high for a specific issue over such a short period,” said Neal Caren, who specializes in social movements in the U.S. at the University of North Carolina. Another cited professor, Erica Chenoweth of Harvard, co-directs the Crowd Counting Consortium, which collects data on the size of crowds at political protests. In a scholarly review, Chenoweth found that international protests that successfully overthrow governments typically require about 3.5% of the population at their peak.
Black Lives Matter never sought to overthrow any governments, but the lasting change it’s accomplished is reminiscent of a revolution. All across the country we’ve been watching a reckoning unfold, from the Minneapolis City Council’s vow to dismantle the police department to the toppling of Confederate monuments. Public opinion of the movement has shifted dramatically in favor over the past two years, paving the way for new generations to more fully grasp the extent to which Black Lives Matter.
There is so much more work to be done, but it’s worth taking a moment to acknowledge all that has been achieved by Black Lives Matter as an official movement and organization. Seven years ago yesterday, July 13, 2013, Alicia Garza, Opal Tometi, and Patrisse Cullors first told the world that Black Lives Matter. Happy anniversary to the movement that was strong enough to stay the course as the rest of the world caught up.
I profiled Cullors for Time in 2018, just as public opinion on Black Lives Matter was starting to reverse from a net negative. “I think we have a crisis of divesting from poor communities, black communities in particular, and reinvesting into these communities with police, jails, courts, prisons,” she told me at the time. Her words are still as relevant as ever.
The difference is, instead of her saying it, or Garza, or Tometi, or me, or Black people in general, a mathematical majority of the country is now saying it. And a big reason why is because of Black Lives Matter.
Aric Jenkins
@aricwithan_a
aric.jenkins@fortune.com
On point
You want a diverse company? Make the CEO pay Experts mean that quite literally. Linking executive compensation to diversity outcomes seems like all the rage — unless you're a CEO. One analysis found that only 78 out of 3,000 companies reported that CEO pay was tied to diversity goal success, and only 11 were willing to share exactly how much compensation was in play. It’s an issue worth discussing, say experts. Diversity goals are one-sixth of the cash bonus of Microsoft’s chief executive, Satya Nadella. Last year his bonus was $10.8 million. “This is an important demonstration of executive commitment to creating an inclusive workplace, and we find this helps ensure there is shared accountability to make progress,” the company said in a statement.
New York Times
Racial disparities in healthcare extend to how doctors treat children’s pain As the health care system undergoes a nation reckoning, it’s vital to note all the different outcomes across broad spectrums of care. But pain is uniquely personal, highly subjective from a practitioner's point of view, and profoundly impacted by largely racist assumptions. In one national study of several cited here, Black children in severe pain from acute appendicitis were just one-fifth as likely to receive necessary painkillers compared to white children. And yes, slavery is a factor. One study, from 2016, found a third of white medical students and residents surveyed believed that Black people had thicker skin and were more pain resistant, an ugly myth used to justify violence during enslavement.
Washington Post
Meet the first Black photographer to ever shoot a Vanity Fair cover His name is Dario Calmese, and his treatment of the resplendent subject, Viola Davis, is in itself, a revolutionary act. “I did know that this was a moment to say something,” he said in an interview. “I knew this was a moment to be, like, extra Black.” Achievement unlocked. He used as a reference point an iconic image, “The Scourged Back,” an 1863 portrait of an enslaved man named Gordon, taken by Union Soldiers after he escaped from a nearby Mississippi plantation. Gordon’s back is a horror of raised scars. But while it is brutal, the photo is also, if unintentionally, powerfully constructed. Click through for the image, his story, and why diversity in media leadership matters.
New York Times
ServiceNow’s Bill McDermott says it’s time for companies to put their (race) cards on the table In our latest episode of the Leadership Next podcast, McDermott talks about his transition from the top spot at SAP, the scramble to respond as the pandemic set in, and how this current “war for talent” means its time to take a hard look at how your talent of color are faring in your organizations. Start by doing a deep audit. “Put the cards on the table and take a look at the facts,” he told Alan Murray and me. “The facts just don’t lie. … And by looking at the facts honestly and openly, you will open up a new gateway to innovation and opportunity within your company because that’s what people want.”
Leadership Next
On background
You say you want a revolution: RaceAhead joins forces with the Aspen Institute I’ll be joining Jim Keane, President & CEO at Steelcase and Carmen Rojas, President & CEO at Marguerite Casey Foundation (and raceAhead treasure) for a conversation called The Value of Worker Voice. It’s part of a fascinating multi-platform series hosted by the Business and Society Program of The Aspen Institute that explores the critical choices facing business leaders in a COVID-19 reality. This subject — worker wellbeing, investment, and empowerment — is woefully underexplored. How can leaders give workers a bigger voice in decision-making? Click here for a blog post with their thoughts, then Zoom along with us if you can on July 21 at 2 pm Eastern time. Register below.
The Value of Worker Voice
Remembering Naya Rivera It is an almost unimaginable loss for fans of the former Glee actor, who thrilled audiences for her portrayal of a queer Latina teen, whose character navigated the intersections of her life with flaws, fierceness, vulnerability and, in retrospect, real grace. Rivera, who died in a boating accident on a Southern California lake, was 33. Fans have been playing her greatest hits and lamenting the loss, but one of many tributes caught my eye. Madison Malone Kircher recalled the moment when Rivera’s character, Santana Lopez, came out to the love of then young life in song. “Santana’s still not ready to tell the world about the full depth of her feelings; she’s struggling just to claim them for herself,” writes Kircher. A moment that exactly matched Kircher’s own struggle at the time. For you, there’ll be no more crying, Naya. Rest in power.
Vulture
The many lessons of Haiti On January 1, 1804, Haiti became the first nation or state anywhere in the world to ban both slavery and imperial rule. While this vital history has gotten more traction in the past few years, some of the nuances of that milestone, and what happened next, have yet to be fully parsed. Marlene L Daut, a professor of African diaspora studies at the University of Virginia, does a beautiful job providing essential context. “[M]uch of the credit for the eventual destruction of the transatlantic slave trade and the elimination of Atlantic slavery has gone to French and British abolitionists,” she writes, snatching the mic back on Ayiti’s behalf. But widespread colonialism and predatory capitalism converged to dampen the movement. “The existence of freedom and independence on the island of Haiti terrified planters and heads of slavery throughout the Atlantic World, including the US president Thomas Jefferson who subsequently punished both states of Haiti by issuing trade embargoes.” What’d he miss? Turns out, quite a bit.
Aeon
raceAhead is edited by Aric Jenkins.
Today's mood board
Congratulations again, Dario!
https://twitter.com/VanityFair/status/1282993522036150273?s=20


fortune--2020-07-14--America’s billionaires have a hoarding problem

In the midst of the worst economic crisis any of us have faced in our lifetimes, those who are most able to afford to help—the 600 or so billionaires in the U.S. and billion-dollar charitable foundations—are more concerned with protecting their vast piles of wealth than they are with fixing the problems we’re facing. Ultra-wealthy so-called philanthropists are pinching pennies while asking for praise, and it’s time for Americans to call them out.
America’s billionaires might seem generous when you look at the absolute amount they give, but percentages are much more telling when it comes to measuring generosity. Bill Gates, for example, is giving $300 million for COVID-19 relief, a number too large for most of us to fathom. But here’s the thing: According to his estimated wealth as of this writing, Gates is giving just 0.3% of his net worth. It’s a big number, but it’s pocket change for him. Based on estimates of what he earns on passive investments, Gates could contribute $300 million every two weeks and still have the same $100 billion at the end of the year as he had in the beginning.
The staggering amounts of hoarded wealth are almost beyond comprehension. Foundations like Gates, Rockefeller, and Ford are sitting on endowments of nearly $1 trillion, but even that is dwarfed by the $12 trillion held by the top 0.1% of households. And things are only getting worse. Food shortages and unemployment are at record highs, yet billionaires managed to add over $400 billion to their collective holdings just since this crisis began. Yet so far this year, the ultra-rich have barely increased their giving at all. To his credit, Gates initiated and signed the Giving Pledge, with which billionaires commit to giving away more than half of their wealth in their lifetimes or in their wills. Why not start now, and give back more than they continue to accumulate?
It’s even more insulting when you consider that most of what they give away is your money. The rich get large tax deductions for their donations—in fact, money donated to private foundations and donor-advised funds can enjoy tax benefits of as much as 70%, and even more in high-income tax states. This means that rich people control who gets the money, but because they get such a big tax cut for every dollar they give away, more than two-thirds of their giving should really be considered taxpayer money.
With a pandemic and economic crisis, it is time for the hoarders—those who control private foundations, sit on donor-advised funds, and rank in the top 0.1% of households—to step up. I encourage them to sign on to the Crisis Charitable Commitment, an effort of the WhyNot Initiative of the Leonard and Sophie Davis Fund, both of which I lead. Signing on means agreeing to contribute a minimum of $100,000 to nonprofits in 2020 at or above defined minimum percentages of net worth.
The pledge calls on private foundations and donor-advised funds to distribute 10% of their assets this year in response to the crisis. This is consistent with the proposal for an emergency charitable stimulus bill, which would require this payout each year for three years. But we can’t wait for legislation—the philanthropic community must step up.
For the 0.1 percenters, this pledge establishes what could be considered a generosity standard for charitable donations, akin to tithing: 2% of assets over $25 million, 3% of assets over $150 million, 4% of assets over $1 billion, and 5% of assets over $25 billion. I accept the criticism that these numbers are low—a billionaire should not be able to buy a seat in heaven by giving just $40 million. But we need to start somewhere, and this will generate a few hundred billion dollars to mitigate damage caused by the coronavirus crisis.
The pledge doesn’t dictate where to give the money—just to give, and give now. Pledges to give lavishly at some point decades in the future aren’t the answer. The pandemic has laid bare the many problems we face, and we don’t have luxury of time when it comes to fixing them.
It’s frustrating to see so many people of wealth speak out about the absurd inequality that exists in our country, even proposing higher taxes on themselves, and yet, when the critical need and opportunity to give back arises, these same people hoard far more than they help. It’s time the richest among us get on board, take the pledge, and make a meaningful difference.
Alan Davis is director of the WhyNot Initiative, president of the Leonard and Sophie Davis Fund, and a member of Patriotic Millionaires.


fortune--2020-07-14--How coronavirus could lead to an unexpected kind of diversity

How tech giants are handling the unprecedented mental health crisis in the workplace

Diversity is often spoken of in solely racial terms. But as more people are working from home, and some are rethinking living in high-priced cities, could investors benefit from an increased focus on geographical diversity?
Jewel Burks Solomon, head of Google for Startups U.S. and managing partner at Collab Capital, says it is prime time for investors to look outside beyond the typical confines of California and New York. Google for Startups provides tools to help new startups get off the ground, while Collab Capital is a fund aimed at Black founders.
“I feel like there is more opportunity now for people to get out of the bubble,” she told Fortune’s Michal Lev-Ram in a Fortune Brainstorm Tech virtual conversation on Tuesday. A former founder herself (she founded a company called Partpic, per LinkedIn), Burks Solomon notes: “I’ve experienced what is was like to have investors say, ‘Oh, you’re in Atlanta, you’re not in Silicon Valley, so sorry, companies we invest are close to us.’ Now that is no longer valid.”
While dealmaking is very much a person-to-person process, the coronavirus has pushed everything into the digital sphere. “It’s a huge opportunity for founders to pitch to folks they maybe would not have had access to otherwise,” she says. “And an opportunity for investors to get outside of their typical location-based bubbles and network-based bubbles.”
The comments come amid a larger conversation around diversity as a whole in tech and the venture industry, sparked most recently by the death of a Black man, George Floyd, while in police custody.
Racial diversity is an issue often emphasized by the community, but the needle has barely moved. This time, says Solomon, feels different.
“There’s obviously a big need to focus in on leveling the playing field for underrepresented startups. There is a thread between George Floyd and the economic impact and the huge disparity across the nation,” she says. “I think people are really asking better questions about what is happening and what are the systems that are allowing this to happen year after year.”


fortune--2020-07-14--How tech giants are handling the unprecedented mental health crisis in the workplace

Betsy Sutter has over three decades of experience in human resources, but nothing has prepared her for the widespread mental turmoil currently afflicting her colleagues.
As chief people officer for business software firm VMware, Sutter has the challenging job of helping manage over 30,000 employees amid a coronavirus pandemic, a major recession, and a national reckoning over racism. With so much to worry about, it’s no surprise that workers are experiencing an unprecedented mental health crisis, experts say.
Just days after widespread protests over racism and police brutality kicked off throughout the U.S., Sutter sounds overwhelmed. VMware employees were already struggling with COVID-19 and ensuing requirements to work from home. “I can honestly say, I have never been this challenged, taxed, and emotional, as you figure out how to navigate this,” Sutter says. “I’m seeing people really crumble.”
Sutter isn’t alone.
Her peers at tech giants like Cisco and Hewlett Packard Enterprise feel similarly as the drip of distressing news and feelings of isolation drain employee morale and increase mental health problems. Cisco chief people officer Fran Katsoudas says the pandemic has “magnified” the need for frank discussions about mental health, frequently a taboo in the American workplace. “You have a high level of stress and you have people who are to an extent isolated from one another,” she says.
Understanding Black trauma
For Black employees, life can be particularly difficult these days. George Floyd’s death in Minneapolis police custody added to an already long list of African-Americans who have died at the hands of law enforcement, including Breonna Taylor, Stephon Clark, and Philando Castile, and a painful reminder of the many struggles fellow Black Americans face.
The current financial crisis, for one, is impacting Black workers more than their white colleagues. For example, a recent survey by Fortune and SurveyMonkey found that “Black adults are twice as likely to have been laid off or furloughed as white adults.”
Black Americans are also more likely to know someone who has died of COVID-19 than white Americans, according to research by the Non-partisan and Objective Research Organization, NORC, at the University of Chicago for the Data Foundation think tank.
Trey Boynton, Cisco’s global lead for inclusion, describes her feelings in recent weeks as a mixture of grief coupled with the “inability to express.” “We gather in times of grief,” says Boynton, who is Black, about the importance of funerals in the Black community. But restrictions on large crowds and fears of contracting the deadly virus mean that traditional places of gathering like churches are closed, causing isolation and loneliness.
Although Boynton is exhausted by the “the sheer overwhelmingness of the loss of life that was so unnecessary,” she doesn’t think she’s “ever heard our country talk about systemic racism” like now.
Michael Lopez, the chief diversity officer of Hewlett Packard Enterprise, says HPE “had to ensure that our Black and African-American team members felt heard and seen.” As part of that effort, HPE CEO Antonio Neri, who recently tested positive for COVID-19 but is doing well and is still working, has been on a virtual “listening tour” with Black employees.
While Lopez declines to comment about the specifics of those meetings, he says they highlighted the “importance of engaging the broader organization about having uncomfortable, or what I call courageous” discussions about race.
Healing from pain
HPE chief people officer Alan May says management has been trying to encourage employees to take care of their mental health. Managers have been undergoing training to spot warning signals so they can urge employees to access mental benefits. “We are encouraging our leaders to connect with every one of our employees every week—not about work, but to see how they are doing,” May says.
He adds that HPE is providing free accounts to the Headspace meditation app, which can be helpful to unload stress. Around 9,000 employees signed up for the app in the span of a month, May says, underscoring how workers are in need of relaxation.
Cathleen Swody, an organizational psychologist and founding partner of executive coaching firm Thrive Leadership, says meditation apps can be useful for newbie meditators. The apps can also be used to help practice mindfulness, the idea of being in the present moment while acknowledging but not giving into thoughts or physical sensations. “The point of mindfulness is to get into the present—to not worry about the past, which tends to be a depressive, or worry about the future, which tends to produce more symptoms of anxiety,” Swody says.
Meanwhile, Cisco has been holding video calls for employees, some of which have involved doctors answering basic questions about COVID-19 that may help alleviate some employee anxiety about the virus. As May explains, these kinds of virtual meetings can help compensate for the fact that “there are no social gatherings for people to grieve.”
Financial distress
Adding to employee nervousness is the financial crisis, which has led to massive layoffs. Many workers who still have jobs are worried about being fired, which makes health insurance more difficult to afford and therefore increases the risk that people will lose access to mental health treatment.
In early 2020, before COVID-19 hit, VMware laid off an unspecified number of workers. For some of them, VMware was able to “extend health insurance coverage,” which came in handy for some who were laid-off and who were still unemployed during the surge in coronavirus this spring. Sutter says VMware would offer flexible choices to laid-off workers to help them through difficult times.
In general, executives interviewed spoke of the need to provide a safe place for workers to discuss their lives and stresses—and not just during the current period of difficulty. Cisco, for instance, has encouraged employees to take their mental health issues seriously for several years, Katsoudas says. For instance, two years ago, after the suicide of celebrity chef and author Anthony Bourdain, Cisco CEO Chuck Robbins sent an email to workers about the seriousness of mental health. “What was so amazing about that was our employees responded to Chuck’s email by telling their own stories,” Katsoudas said.
As the pandemic continues, and the push for racial justice grows, employees will likely have more stories to share about mental health.


fortune--2020-07-14--Moderna’s coronavirus vaccine produced antibodies in all patients tested

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Moderna Inc.’s Covid-19 vaccine produced antibodies to the coronavirus in all patients tested in an initial safety trial, federal researchers said.
The neutralizing antibody levels produced were equivalent to the upper half of what’s seen in patients who get infected with the virus and recover, according to the results published Tuesday in the New England Journal of Medicine. The Moderna vaccine is one of the farthest along for Covid-19.
While stimulating production of neutralizing antibodies doesn’t prove a vaccine will be effective, it’s considered an important early step in testing. Meanwhile, the side effects reported weren’t severe enough in the majority of patients to preclude further testing, according to the report by researchers from the National Institute of Allergy and Infectious Diseases.
Moderna’s shares gained 16.4% in trading after the market closed. The stock has more than tripled in value so far this year on hopes that its vaccine will gain rapid approval.
More than half of those who got the middle of three doses suffered mild to moderate fatigue, chills, headache and muscle pain. Also, 40% of people in the middle-dose group experienced a fever after the second vaccination. Three of 14 patients given the highest dose of the vaccine experienced severe side effects, but that dose is not being used in larger trials.
“Man, that is a lot of adverse events,” said Tony Moody, a doctor and researcher at the Duke Human Vaccine Institute. He said it would be “unusual” for a vaccine to have this rate of side effects. On the plus side, he said that the antibody levels produced were “really encouraging.”
If researchers are measuring the right thing, the vaccine should work, he said, noting that this can only be proved in large trials.
The initial results are from the first group of 45 patients who received the vaccine, and evaluated three doses of the vaccine that were given in a two-shot regimen. The middle dose from this initial trial will be used in a large final-stage trial of the Moderna vaccine, called mRNA-1273, that is slated to begin on July 27th.
The final stage trial will compare the vaccine to placebo shots in 30,000 healthy people at high risk of coming down with the coronavirus.
One significant limitation of the data is it only includes data from the first 45 patients in the study, all of whom were from age 18 to 55. Results from a second portion of the phase 1 trial that included people older than this — a key demographic for any Covid-19 vaccine, given the high death rate in older patients — are not available yet.
William Haseltine, a former Harvard Medical School researcher who chairs Access Health International, said the levels of neutralizing antibodies produced were “respectable” and possibly protective. But he said “the jury is out” on safety of the vaccine.
Unlike traditional vaccines, which inject a weakened or inactivated virus or a piece of a virus to trigger an immune response, the Moderna product uses genetic material called messenger RNA to cause cells to produce the coronavirus spike protein. The goal is to produce antibodies to the virus that protect against the disease when someone is later exposed to the coronavirus.
How long
The vaccine “clearly worked in that antibodies against the spike
protein were generated, including antibodies that had virus neutralizing capability,” said Paula Cannon, professor of microbiology at Keck School of Medicine of USC. A key question will be how long will the antibodies last before they start to wane, she said.
The initial findings from the Phase 1 trial are largely in line with top-line results Moderna published in a press release in May, but provide more details on the antibody levels produced and side-effects that were seen.
At the time, Moderna was criticized by some scientists for putting out a release describing positive results that temporarily drove up the company’s stock price, but included few numbers that would allow scientists to interpret the data.
The government-sponsored trial was led by Lisa A. Jackson of Kaiser Permanente Washington Health Research Institute in Seattle, the NIAID said in its statement. Emory University in Atlanta also enrolled participants in the trial.


fortune--2020-07-14--Will Tesla be added to the S&P 500? Here’s how it will be decided

Tesla stock has been on a tear in 2020, becoming the most valuable car company in the world this month, and starting this week up 16% (though it has since given up most of those gains).
A major driver of Tesla’s recent run is rampant speculation that the company will be added to the S&P 500—the blue-chip U.S. stock market index—following its earnings report next week on July 22. The bulls’ thinking goes that Tesla’s inclusion in the S&P 500 would automatically force all sorts of passive investors—such as exchange-traded funds (ETFs) and other index-tracking funds—to buy Tesla stock, boosting the shares further.
The investment thesis is generally valid. History shows that stocks have risen after their addition to the S&P 500: When Amazon was inducted into the index in 2005, its shares rose nearly 5% on the announcement. Many of the investors who bought Tesla on Monday—nearly 50,000 on the investing app Robinhood alone, according to analytics site Robintrack—are likely looking to own the stock before it’s added in order to catch that potential windfall.
Yet despite the hype, Tesla’s addition to the S&P 500 is far from assured. Here’s what it would take and how likely it is to happen—and when.
Will Tesla join the S&P 500?
Besides market valuation and trading liquidity requirements—which Tesla, with a market cap of more than $277 billion and more shares traded in a day than what’s required in a month, easily meets—the last remaining criterion for the S&P 500 is profits.
To be included in the S&P 500, not only must a company have netted a (GAAP) profit over the past four quarters combined, it must also record positive net income for the most recent quarter. That means, while the electric vehicle maker has reported a profit for the past three quarters in a row, according to the rules, Tesla must also post a profit for the second quarter of 2020, when it reports those financial results next week.
Wall Street, however, does not expect this to happen. Analysts estimate that Tesla will report a loss of more than $377 million for the quarter ended June, according to Bloomberg data.
Still, the consensus view has not stopped some from predicting that Tesla will be added to the S&P 500 anyway, even if it does not meet the official criteria. In a note published Tuesday by Bloomberg Intelligence analysts, the authors write that Tesla’s inclusion in the index “may require human intervention,” and that they expect the committee that oversees the S&P 500 “to make an exception and add the automaker anyway.”
The analysts reason that the S&P 500’s recent underperformance—it’s down about 1% year to date while the Nasdaq has risen some 17%—is due in part to its lack of high-flying stocks like Tesla and Zoom. Tesla stock has rocketed about 266% so far in 2020, making it one of the year’s best-performing stocks.
Bloomberg Intelligence also points to a fine-print specification in S&P Dow Jones Indices’ official documents, that its committee “reserve[s] the right to make exceptions when applying the methodology if the need arises.” Such discretion, the analysts argue, “is an acknowledgement that index rules occasionally need to be overridden.”
It’s unclear, though, if the S&P 500’s committee has ever actually bent its own rules. “I’m unaware offhand of any examples where we added a company whose most recent earnings quarter was not positive,” Ray McConville, a spokesperson for S&P Dow Jones Indices, tells Fortune.
Investors buying Tesla now on the assumption that it will be added to the S&P 500 should be aware they are taking a leap of faith.
When would Tesla be added to the S&P 500?
If the index’s committee did decide to add Tesla to the S&P 500, it would not happen immediately when the electric car maker reports earnings next Wednesday after the market close.
Changes to the S&P 500 aren’t made based on when a company gains or loses eligibility, but rather whenever the index’s committee “deems necessary,” according to McConville, the spokesperson for S&P Dow Jones Indices.
“All that’s to say that there’s no future date on the calendar when the next changes will be made,” he says.
The S&P 500’s committee does meet monthly, and could potentially make changes to the index’s constituents then, but the firm could not confirm by press time when the next meeting would take place; it also rebalances the index each quarter, and could swap companies in and out then, but that’s not scheduled to happen until Sept. 21.
In the past, when S&P Dow Jones Indices has added companies to the S&P 500, it announces the changes four to 10 days ahead of when they actually take effect—which is always before the market opens for trading.
Of course, investors looking to get the biggest pop on their investment will want to buy the stock before the official announcement.


fortune--2020-07-14--A.I. can help solve America’s education crisis

U.S. education is in crisis. Poorly paid teachers, funding tied to property taxes, and the lack of a national curriculum have produced a fractured national landscape for primary education. The ongoing coronavirus pandemic has exacerbated that situation, forcing unprepared teachers to teach remotely.
In higher education, enrollments were dropping as tuition climbed even before the ongoing pandemic. COVID-19 has only accelerated that trend.
The country needs a new paradigm. Artificial intelligence is part of the answer.
Man has known since antiquity that the best education is delivered one-to-one by an experienced educator. But that is process is expensive and labor-intensive and cannot scale. The result is the classroom-based instruction that, despite its obvious drawbacks, has persisted for centuries.
Forty years ago, there was excitement about so-called adaptive learning based on expert systems, elaborate “if-then” decision trees that led students on a path through content compiled by subject experts. But building the knowledge bases required for such systems was time consuming and costly, and ultimately couldn’t scale.
A.I. has come a long way since the early adaptive-learning days. Researchers are beginning to understand how the brain learns and are applying that understanding to networks of algorithms that learn on their own. Those methods, in turn, are being used to build software that makes it easier and more engaging for students to study. These A.I. tutors, software systems that students interact with online, can give everyone individualized attention. Suddenly, one-on-one teaching can scale.
A.I. tutors are eternally patient. What’s more, their teaching is not based on guesswork or intuition, but on data. Learning algorithms uncover patterns about how individual students perform, and companion algorithms optimize teaching strategies accordingly.
Kidaptive, a startup out of Stanford University, has an adaptive-learning platform for children that paints a vivid picture of the learner’s skills, interests, and activity across products and over time. That information is used to personalize education with real-time assessment, such as interactive teaching through animated story lines delivered on iPads or other touch-screen devices.
My own company, Riiid, has prepared over a million students for English proficiency exams on our A.I. tutoring app, Santa. We are now developing A.I.-driven platforms for education companies, school districts, and national governments in the U.S., South America, the Middle East, and Asia. Other companies are also preparing to launch A.I. tutoring systems in the coming months.
Studies show that these systems can raise student performance well beyond the level of conventional classes and even beyond the level achieved by students who receive instruction from human tutors.
Advances in generative adversarial neural networks and A.I.-driven animation, meanwhile, are creating realistic avatars that will soon put a friendly face on A.I. tutors. Smart speakers, millions of which are already in people’s homes, will also deliver classes powered by A.I. This is not fantasy or science fiction. It is just getting started, but it is happening now.
Teachers will not disappear, but much of the drudge work of teaching will. A.I.-powered apps are not only taking over grading, the bugbear of every instructor, but are collecting meaningful data that would otherwise disappear.
Bakpax is an A.I. platform that uses computer vision to read student homework and grade it automatically. Gradescope assists teachers by converting schoolwork to digital form with tools to speed grading. Both systems collect data on student performance that would otherwise end up in the trash can. That data can, in turn, be analyzed by A.I. systems to uncover useful patterns, which teachers can use to adjust their methods or syllabi, forever optimizing their own performance.
Most importantly, A.I. tutors are a step toward democratizing education. Eventually, any parent with an Internet connection will be able to give his or her child an effective, personalized learning experience regardless of zip code.
A.I. can help, too, in shaping higher-education curricula to maximize the successful employment of graduates, which is itself a critical metric in attracting students and justifying high tuition fees.
Never has education needed these solutions more than now. With COVID-19 still going strong and a rise in infections projected this fall, instruction will continue to be largely online.
Top university courses can now be taken online for free or a fraction of the cost and commitment of a four-year degree. Project portfolios are replacing academic credentials as the most important metric for many prospective employers. In recent years, many schools turned to full-fee paying international students to shore up fragile finances, but the pandemic has cut that short.
Analysts are predicting a wave of consolidation as smaller schools merge or close altogether. America’s roughly 4,000 colleges and universities may shrink by as much as half that number within the next decade.
Education administrators need to explore available A.I.-powered solutions to deliver quality education while protecting faculty and students alike; streamline curricula and align educational offerings with government and private sector needs; and optimize budgets, building solid long-term plans for financial survival. Parents need to pay attention.
Education is the foundation of a healthy economy. Equity in education is crucial for a cohesive society. The tools exist to fix the U.S. education system. The only thing missing is a plan.
YJ Jang is CEO and founder of Riiid, an A.I. education company that builds systems to power online and offline learning.


fortune--2020-07-14--The Telluride Film Festival is canceled due to the coronavirus pandemic

The Telluride Film Festival, the annual film retreat held in the Colorado mountains and one of the fall movie season’s top launching pads, has been canceled.
Organizers said Tuesday that the festival’s 47th edition, scheduled for Labor Day weekend, was scuttled entirely due to the coronavirus pandemic. Through much of the summer, Telluride had clung to hopes that cancellation wouldn’t be necessary. But with infections spiking throughout much of the South and West, the decision, organizers said, was “heartbreaking and unanimous.”
“While there will be those who might say they’re not surprised by it, that this was inevitable, we beg to differ. It didn’t have to be this way,” the festival said in a statement. “Until the past week or so, we had a very good plan to put on the show safely. But with a seemingly unending number of new cases of COVID-19 and the national chaos around it, even the best strategy is threatened by this out-of-control environment.”
Much of the summer movie season already was postponed, and it seems increasingly certain that the fall will also be very different for the film industry. Telluride is part of a late summer-early fall foursome of major festivals, along with the Venice Film Festival, the Toronto International Film Festival and the New York Film Festival.
Telluride is the most laid-back of the bunch. It offers no awards to drum up competition and doesn’t even announce its lineup in advance. Recently, Telluride organizers were told that two of their usual venues at local schools couldn’t be used this year.
But Telluride’s relaxed atmosphere has long been its biggest draw, and the festival plays a pivotal role for premiering awards contenders, falling right in between Venice and Toronto.
Last week, the four festivals signed a joint pledge saying they were working in “collaboration as we never have before.” Venice, Toronto and New York have all made plans for much-scaled down events with some virtual components.


fortune--2020-07-14--NBC’s Peacock launches nationwide July 15. What to expect on its free and paid tiers

A brand new streaming service enters the picture Wednesday NBCUniversal’s Peacock launches nationally.
Peacock is sticking its head up in what is the best of times and the worst of times for streaming services: Viewers confined at home during the coronavirus pandemic have been logging huge amounts of streaming screentime, but competition is increasingly tough thanks to new entrants including Apple TV+, Disney+, and HBO Max. There’s a lot of debate about just how many streamers customers are willing to pay for.
But for both viewers and business watchers, Peacock is notable because it’s hedging its bets on that question. Instead of trying to poach subscribers from the likes of Netflix, Peacock is the first new high-profile streaming service in more than a decade that offers a free, ad-supported tier. (Hulu offered a free tier following its launch in 2007, but that option was eliminated in 2016.)
Free is also a very appealing proposition for viewers, though they might quickly find they have to upgrade to see everything they’d like on the service. So if you’re weighing which option is right for you—or whether you want to bother with Peacock at all—here’s what you need to know.
How much does Peacock cost?
Peacock’s free tier is, well … free. But you’ll have to watch ads with your shows, and you’ll only have access to a little more than half of Peacock’s content.
One Peacock Premium tier will cost $4.99 per month, though it will be free for many viewers, including those who are already Comcast cable customers. This version of Premium includes a lot more programming than the free tier, but also still includes advertising.
Finally, for $10 per month, viewers can get an ad-free version of Peacock Premium. That’s still noticeably less than the monthly price of competitors including Netflix ($12.99 per month) and HBO Max ($14.99 per month).
How many ads will I have to watch?
Peacock says its free and Premium tiers will have five minutes of ads per hour of programming, or less. That’s well below the amount of ads you’ll see on either broadcast TV or most cable channels, which ranges from 14 to 17 minutes per hour. That may be sustainable at least in part because Peacock will feature NBCUniversal’s new interactive ads, which make it easier to buy products being advertised.
What’s showing?
Peacock’s free tier includes 13,000 hours of programming, while the Premium tier has 20,000 hours’ worth. The division between free and Premium offerings, though, is a bit of a tangle.
Broadly, Peacock’s free tier will include rebroadcasts of current shows from NBC and Telemundo, such as This is Us, on a one-week delay. It also includes select episodes of Peacock’s original shows; a selection of movies; classic shows such as 30 Rock, Law and Order, and Cheers; and news. The free tier will also reportedly include some teaser sports broadcasts: four English Premier League soccer matches, coverage of U.S. Open tennis, and an NFL wild-card playoff game.
Peacock’s premium tier will feature the same NBCUniversal rebroadcasts, but available the day after broadcast instead of a week later. It will also add “premium” movies and full seasons of Peacock originals. NBC’s The Tonight Show and Late Night will reportedly air on Peacock before they’re broadcast, starting at 8p.m. ET, which could be a significant draw for some paying subscribers.
Premium subscribers will also get more sports, most notably 175 Premier League games—reportedly the most English football ever available to U.S. viewers.
Peacock is also licensing some older TV series from outside the NBCUniversal orbit. Those include Showtime series such as Ray Donovan and The Affair, and CW shows including Everybody Hates Chris and The Game. It’s not currently clear whether they’ll be available through Peacock’s free or premium tiers.
What are Peacock’s original shows?
The coronavirus pandemic disrupted the production of some original Peacock programming, and delayed the Tokyo Olympics, which was expected to be a major driver for the platform’s launch. But Peacock will still have a solid slate of original shows, with full seasons available only to Premium subscribers. Particularly intriguing is an adaptation of Aldous Huxley’s political dystopia Brave New World, which could tap into contemporary anxieties in the same way Amazon’s Handmaid’s Tale did when it debuted in 2017.
Other originals include the conspiracy thriller The Capture, featuring Ron Perlman and Shaun Emery; a reboot of ‘90s teen comedy Saved by the Bell (launching sometime in 2020); the cybercrime-workplace comedy Intelligence, starring Friends alum David Schwimmer; Sports-reality show In Deep featuring swimmer Ryan Lochte; and new kids’ shows including Cleopatra in Space and revamps of Curious George and Where’s Waldo.
The platform will also feature a new season of comedy A.P. Bio (Sept. 3), which previously aired on NBC, and will air a new movie in the Psych franchise.
Read Fortune‘s interview with David Schwimmer and costar Nick Mohammed here, and an interview with the cast of Psych 2 here.
What movies are on Peacock?
Peacock appears roughly comparable to Hulu in emphasizing episodic TV over movies, but it’s promising a decent selection at launch, including American Psycho, the Jurassic Park films, and Schindler’s List. Particularly notable are a package of Paramount films licensed from ViacomCBS, including the Godfather trilogy, American Beauty, and Fatal Attraction.
How can I watch Peacock?
Peacock’s streaming app will be available at launch on Apple and Google devices, on Microsoft Xbox, and on Vizio and LG smart TVs. NBCUniversal also announced on Tuesday that Peacock will be available to stream through Sony’s Playstation 4, though not until July 20, the week after the service launches.
Though it may be change at a later date, Peacock will not be available at launch through either Roku or Amazon Fire TV devices. Those are the two biggest streaming media players in the U.S., with about 70% of the U.S. streaming device market. Negotiations to get Peacock on Roku and Fire TV are reportedly stalled over details including how Peacock would share user data with streaming device makers, and where the channel would be featured in app marketplaces.


fortune--2020-07-14--Bored sports fans are flocking to video games, Electronic Arts CEO says

The shutdown of professional sports leagues worldwide due to the COVID-19 pandemic has prompted fans to flock to video game sports titles instead.
Soccer simulation game FIFA has experienced an 80% increase in play in EA’s most recent quarter (it had 100 million players during all of last year), said Andrew Wilson, CEO of video game giant Electronic Arts. Meanwhile, the number of Madden NFL football title players has increased by “triple digits” and the number of people playing EA’s NHL hockey games is also up significantly.
“As human beings we have an insatiable appetite for sport,” Wilson said during an online Fortune Brainstorm Tech event on Tuesday.
Some people feared that the suspension of live sports leagues—some have since restarted, mostly without fans—may depress interest in their gaming counterparts. But that’s not what happened. “At a time where we’ve had almost zero sports on television or that you could go watch at an arena, the engagement in our sports games never been higher,” Wilson said.
EA has also used the pandemic shutdown to host virtual matches with professional athletes. In April, it hosted the EA SPORTS FIFA 20 Stay and Play Cup, during which 20 professional soccer players competed against each other online. FC Copenhagen’s Mohamed Daramy won the video game crown.
“We started to create different storylines in the virtual world in and around the athletes and the sports people love that are different from what goes on in the real world,” Wilson said. “As we look at a year where the question (is) are sports going to be on, are they going to stay on, what we’ve done is continue to build in that connection to the real world sports.”
Shares of EA, which rose 2% on Tuesday, have gained almost 20% since early May when the game maker beat Wall Street expectations by reporting quarterly revenue that had increased 12% to $1.4 billion. In June, EA CFO Blake Jorgenson said the company would exceed its sales guidance of $1.2 billion for the current quarter, without providing more details.


fortune--2020-07-14--One nonprofit’s ambitious new innovation for rare blood cancer patients

Good afternoon, readers.
Longtime readers are likely familiar with the Multiple Myeloma Research Foundation (MMRF), the largest nonprofit group for patients who have the rare blood cancer. On Tuesday, the group launched an ambitious new initiative called “CureCloud” into which founder Kathy Giusti gave Fortune a first look.
Giusti’s organization has been at this work for well over two decades and her philosophy—guided by experiences as a pharmaceutical executive, a multiple myeloma patient herself, and now a nonprofit leader—is simple: You need to provide the patients true value and break down the walls of academia to spur cancer drug development.
She describes CureCloud as a “crescendo of disruption.”
“With our support, anyone can now get sequenced,” Giusti tells me. “It doesn’t matter what your economic status is, we will sequence you if you raise your hand.”
The concept is (and you can read much more about it in my story from this morning) a technician can come into a patient’s home, conduct a blood test that will allow for that person’s genomic sequencing, and then get personalized information about which treatments and medical choices will work best for them. That can simultaneously inform patients while spurring new drug development in a democratized process.
It sounds like services such as 23andMe and Ancestry. But there’s a key difference. This is all free.
Read on for the day’s news.
Sy Mukherjee
sayak.mukherjee@fortune.com
@the_sy_guy
DIGITAL HEALTH
A coronavirus test using... paper? Given the troubles of coronavirus testing (more on that below) new innovations in the space will prove critical. To that end, 3M is working with MIT in order to create a paper-based COVID test which they believe could be mass produced. "Our approach is ambitious, but our collective expertise can make a difference for people around the world, so we owe it to ourselves and society to give it our best effort," said John Banovetz, chief technology officer at 3M. (FierceBiotech)
INDICATIONS
Merck strikes HIV deal with Dewpoint worth up to $305 million. Merck became the latest company to team up with Dewpoint Therapeutics on Tuesday, in this case to develop HIV treatments with a deal worth up to $305 million. This adds to the $100 million arrangement between Dewpoint and Bayer to develop new heart and gynecological treatments. Merck is among a handful of big pharmas with a large presence in the infectious disease space. (BioSpace)
THE BIG PICTURE
Can coronavirus pass through pregnancy? My colleague Katherine Dunn delves into the complicated issue of whether or not coronavirus can afflict pregnant women, their fetuses, and their newborn children. There's significant nuance and controversy built into the issue, and Katherine parses them in clear terms following a new study from France suggesting coronavirus can be transmitted from mother to newborn in the womb. "Extensive blood testing of both the mother, the newborn, placenta and amniotic fluid revealed the baby had contracted COVID-19 through the mother's placenta," according to the research. But this is still a rare occurrence to date. (Fortune)
REQUIRED READING
How the coronavirus has impacted VC dealmaking in 2020 so far, by Lucinda Shen
The class of 2020 is getting a crash course in job market uncertainty, by McKenna Moore
U.K. researchers warn that a second wave this autumn could be deadlier than the first one, by Bloomberg
Sign up for other Fortune newsletters.


fortune--2020-07-14--PS5 Preorder: PlayStation 5 release dates and price rumors

Gamers are expectantly awaiting details about PlayStation 5, the upcoming generation of Sony’s popular video game console.
In the absence of official notice from Sony, the online rumor mill has been grinding away about the price, preorder date, and exact release date. One piece of gossip even suggested the much-sought-after information might be revealed as early as this week.
Gone on holiday
Roberto Serrano, a business analyst at DXC Technology, a spinout of Hewlett Packard Enterprise, suggested on Twitter that the PlayStation announcements would arrive “around” 12:30 p.m. PT on Monday. He claimed that “sources inside the entertainment industry” tipped him off about the timing.
Around 12.30am PT | 9.30pm CEST — Roberto Serrano' (@geronimo_73) July 11, 2020
The hour came and passed and no new details emerged. Serrano and Sony did not immediately reply to Fortune’s requests for comment.
Since then people—and gaming blogs—have been circulating a PS5 product page on Amazon, apparently believing it to be new. The page first appeared in June and has not changed from the original, which a web archive search confirms.
Following PlayStation preorder rumors, Amazon's PS5 page has gone live. Could it be happening???
Amazon: https://t.co/P7aAkLQYGf
Everything we know about PS5 preorders: https://t.co/Bb8PSTD4y3 pic.twitter.com/jj8U7LBELq — IGN (@IGN) July 13, 2020
The PS5 is expected to be available by year’s end. Sony said in a March financial statement that the console’s release date is “scheduled for the 2020 holiday season,” despite the disruptions caused by the coronavirus pandemic.
When is the PS5 preorder release date, exactly?
Aside from providing the vague “holiday” time frame, Sony has not specified an official release date for the PS5. (If past years are any indication, the PS5’s release date will likely come in November.) The preorder date remains a mystery as well.
People have reason to be eager to place preorders. Sony is expected to release a more limited supply of the gaming consoles than it has in years past, a situation that could cause a sales bottleneck, Bloomberg reported earlier this year.
Rival console-makers have already been struggling to meet demand. COVID-related interference in component part production and shipments, plus increased interest in video games from people sheltering at home, have caused Nintendo Switch inventory shortages.
Anyone wishing to keep track of preorder announcements and other information can visit product pages or sign up for mailing lists hosted by retailers such as Best Buy, GameStop, Walmart, Sony PlayStation site, Target, Amazon (U.K.), and GAME (U.K.).
When it debuts, Sony’s PlayStation will be competing with Microsoft’s upcoming Xbox Series X console. The two tech companies are poised to duke it out during the holiday shopping season, a crucial bonanza for sales.
How much will PS5 cost?
It’s unclear how much Sony will be charging for the PlayStation 5, though people generally expect it to be around the $500 price point.
Last month Amazon U.K. accidentally published a product page for the PS5 featuring a price tag of £599.99, or about $765. An Amazon spokesperson said the listing, widely considered too steep to be real, was “an error.”
Sony may be waiting for Microsoft to announce the price tag of the Xbox before deciding on its own. The rivalry could force Sony to sell its system for cheaper than what it cost to make, analysts told Fortune.
Microsoft has an Xbox event planned for July 23, where it’s expected to reveal details about upcoming games including Halo Infinite, the latest installment of Microsoft’s popular space combat franchise.
Last month Sony released details about some of its own upcoming PS5 games, including Spider-Man, Assassin’s Creed, and Far Cry 6.


fortune--2020-07-14--Big bank earnings: The good, the bad, and the ugly

Wall Street is preparing for the worst.
A slew of big banks, including JPMorgan Chase, Citigroup, and Wells Fargo, reported earnings for the 2nd quarter on Tuesday. But as expected, the biggest concerning sign was the record amounts of loan loss provisions the banks are building to hunker down: JPMorgan Chase, Citigroup, and Wells Fargo all reserved billions for future loan defaults, as banks are anticipating the coronavirus crisis will deal a blow to borrowers in the coming months.
“I think what we’re seeing right now is [with] both the Fed and the government programs coupled with deferrals at the banks, we’re not seeing the consumer stress yet,” David Konrad, senior research analyst at D.A. Davidson, suggests to Fortune. “But I think what the banks are saying is, ‘It’s coming.'”
While the loan loss provisions are “the headline grabber and for good reason given the billions of dollars at stake, the earnings environment for banks is also complicated by low interest rates, a worse-than-expected macro environment and uncertainty associated with COVID-19 which continues to surprise in a negative way,” Bankrate.com senior economic analyst Mark Hamrick told Fortune in a note.
JPMorgan Chase, America’s largest bank, set aside $10.47 billion to cover loan losses. The provision fits with what CEO Jamie Dimon prophesied in his annual letter to shareholders earlier this year: best case, the pandemic will create “financial stress similar to the global financial crisis of 2008.”
Now, banks are warning of uncertainty: CEO Dimon cautioned, “Despite some recent positive macroeconomic data and significant, decisive government action, we still face much uncertainty regarding the future path of the economy,” Dimon said in the earnings release.
The good
But the bank titan also gave investors a big surprise: JPMorgan topped revenue estimates, reporting $33 billion, up 15% from the year-ago quarter. (Profits for the bank, meanwhile, dropped over 50% to $4.7 billion).
One standout figure? The bank reported record fixed income trading revenue of $7.3 billion—and total trading revenues were up 79% at $9.7 billion. Massive volatility in the markets amid the crisis, plus an ever-accommodating Fed injecting liquidity in the market and purchasing corporate bonds, has “just created this backdrop of a lot of investment banking and capital markets activity, and almost an accretive capital raise for the bigger banks,” notes Konrad.
However, management at banks like JPMorgan have warned the massive revenues from trading won’t be sustainable—”The guidance was certainly that that’s not going to continue,” Konrad says.
The banks are preparing their balance sheets for a W-shaped recovery, but analysts like Konrad note that while management likely don’t anticipate the recovery will go that poorly, “Any variation toward a W would create more reserves going forward.” Especially with new cases of the coronavirus spiking across the country, the confidence banks have in their shored-up balance sheets might be “a completely different story.”
Citigroup also happily surprised the Street, reporting revenues of $19.8 billion (up roughly 5% from last year) and $1.3 billion in profits (down 73% from a year ago), both above expectations. The bank’s markets and securities revenues hit $6.9 billion, up 48%, with the lion’s share coming from fixed income trading, up 68% from the year-ago period.
The bad
But Wells Fargo, on the other hand, was “a bit of a mess,” Konrad remarks. “They don’t have the investment banking and trading offsets, and they were behind in the reserves and had to take a much bigger reserve.”
The bank reported a below-estimates $2.4 billion loss for the quarter, while revenues fell roughly 17.6% from the year-ago quarter (reporting $17.8 billion). To boot, the bank announced it will cut its dividend to $0.10. And CEO Charlie Scharf didn’t sugar coat it: “We are extremely disappointed in both our second quarter results and our intent to reduce our dividend. Our view of the length and severity of the economic downturn has deteriorated considerably from the assumptions used last quarter, which drove the $8.4 billion addition to our credit loss reserve in the second quarter,” he said in the earnings release.
The ugly
Yet even for the two banks that beat earnings estimates, consumer revenues slumped: JPMorgan’s consumer and community banking revenues fell 9%, while Citigroup’s dropped 10%.
“They both missed on consumer revenues, so that’s kind of the opposite effect—I think the capital markets [revenue] was almost a disconnect with the economy given all the government programs, and maybe the consumer side was a little bit more reflective on the revenue side of where we’re at in the economy,” Konrad suggests. In that sense, “I think the consumer revenue will weigh on the next couple quarters, so that’s probably the risk factor of otherwise really strong results,” he says.
Analysts at Goldman Sachs were expecting the worst: the firm estimated earnings for banks to decline by 69% in the 2nd quarter. And while some analysts like Konrad walked away from earnings on Tuesday feeling “encouraged,” he notes the risk factors are concentrated in consumer revenue trends and “the commercial past-dues and non-accruals that jumped up.”
Citigroup and Wells Fargo’s stocks were down in afternoon trading, while JPMorgan traded up about 0.5%. All three are deeply in the red for the year.


fortune--2020-07-14--What causes crazy-high prices on Wayfair and Amazon?

Cabinets priced as high as $14,500 through online furniture seller Wayfair recently set off the alarm bells for some shoppers. Were they really worth that much when other cabinets cost so much less?
The curious cabinets became the subject of a bizarre conspiracy theory started by an anonymous Reddit user. The poster baselessly speculated that the cabinets were evidence of child trafficking, in part because some of the cabinets shared names with missing children.
Wayfair denied the allegations, saying in a statement that “there is, of course, no truth to these claims.”
But this is not the first time a high-priced listing from an online retailer has made headlines and drawn suspicion. After all, Amazon really does offer a pillow that costs more than $10,000, and in the past had a textbook about flies listed for $24 million.
So what exactly is behind these strange prices? Here are four likely reasons, according to pricing experts.
Algorithms gone wild
One explanation for some of the crazy prices you’ll see online is that when computers are programmed to compete with each other, things can get strange.
That’s how Amazon wound up offering a $24 million textbook in 2011. Two third-party sellers, both apparently using automated pricing technology, were offering the book. The two programs responded to each other’s pricing changes, both steadily adjusting prices upwards. Someone eventually noticed, but if the person hadn’t, the algorithms could have kept at it until the book was priced in the billions of dollars.
Not all algorithms are simply competitive, though. Sometimes they’re influenced by other factors, including inventory levels. According to Patrick Campbell, cofounder of pricing consultancy ProfitWell, algorithmic prices for particular products can “go a little nutty” thanks to factors including low stock at a supplier.
All of which is a good reminder that, as fancy as they sound, a lot of algorithms just aren’t very smart. And they may be making humans a little bit dimmer too. “The push toward increased digitalization and algorithmic decision-making means that the spectrum of human decisions is shrinking,” researcher Dionysios Demetis of the Hull University Business School told Fortune.
Placeholder pricing
The Internet has, broadly, two different types of online retailers. Some, like Wayfair, manage their own product offerings, listings, and pricing. But many, including Amazon and Walmart.com, allow third-party sellers to operate on the site.
On those open marketplaces, at least some strange prices have a very boring explanation: They’re an easy way for sellers to effectively “deactivate” a product when they’re out of stock. For small-scale sellers, changing an item’s price to something outrageous is faster and easier than taking it offline entirely. According to Campbell, even larger brands with particular items that aren’t “behaving properly” in an e-commerce system will sometimes deliberately hide items by giving them absurdly inflated prices.
“When there’s essentially a bug [with an item listing], it’s easier to make the item throw up a flag, but still remain listed,” Campbell says.
Some things are actually expensive
At least in the case of the cabinets flagged by our initial Reddit conspiracy theorist, the actual explanation turned out to be the most boring of all: They’re just really expensive cabinets.
Wayfair, in a statement to Newsweek about the recent unproven scandal, said that “the products in question are industrial-grade cabinets that are accurately priced. Recognizing that the photos and descriptions provided by the supplier did not adequately explain the high price point, we have temporarily removed the products from the site to rename them and to provide a more in-depth description and photos that accurately depict the product to clarify the price point.” Wayfair did not respond to a request for comment by Fortune.
It’s hard to know exactly what features, materials, or specifications may make any particular item seemingly hyper-expensive compared to superficially similar products. But the world is wide and full of wonders: After all, some people will pay $1,000 for an ice cream sundae.
A pillow priced at more than $10,000, sold through Amazon by third-party retailer Downright.
The high-price halo effect
Sometimes absurdly high prices are real—but they’re mostly designed to shift your perception of other products.
“When you have a high anchor price, it can be used to make other prices look very reasonable,” says Rafi Mohammed, an economist and pricing consultant. Mohammed points to one well-known case in which Williams Sonoma introduced a bread machine priced at $429. That model flopped, but sales of a cheaper $279 model boomed. Shoppers, surveys later found, thought the $279 model was a better deal when it was sitting next to an even more expensive machine.
Some retailers may be doing the same thing online, inflating the price of one item to make others more appealing by comparison. If conspiracy theorists are looking for questionable retailer behavior, they might consider redirecting their energies to this real-world Jedi mind trick.


fortune--2020-07-14--Best Buy to require shoppers to wear masks in all stores

Best Buy has joined the growing ranks of major retailers requiring shoppers to wear masks when visiting its stores.
The electronics retailer said the move will be effective as of July 15 and aims to “help protect not only our shoppers and communities, but also the tens of thousands of Best Buy employees working to serve our customers each day.”
Best Buy joins national retailers such as Costco Wholesale, Dollar Tree, Verizon, H-E-B, and Apple in making face coverings mandatory for customers as well as store workers, a policy that has seen pushback from some shoppers.
When Costco announced the policy in early May, some shoppers took to social media to claim the company was infringing on their rights and threatened a boycott. But Costco’s sales results in the aftermath of the announcement suggest such threats were empty: Its U.S comparable sales in June rose 11%.
During this particularly fraught time for retailers, many of which had to deal with sharp sales drops during the pandemic lockdowns, there is an apprehension to antagonize any segment of their clientele—especially when local or state governments have not stepped in with clear safety guidelines.
Walmart CEO Doug McMillon said on Bloomberg Television on Monday that masks are currently required in about 3,700 of its more than 5,000 U.S. locations, “where either the governor or someone else has mandated it.” But the nation’s largest retailer still hasn’t ruled out the possibility that it might institute its own mask requirements.
“We don’t currently, as we’re doing this interview, mandate that in our other stores, but that’s obviously something that’s on our minds,” McMillon said.
With COVID-19 case numbers exploding in many states, and the reversal of reopenings in places such as Los Angeles and Dallas, retailers are keenly aware of the risk of sales plummeting again because of closures—or simply because shoppers are too anxious about going into physical stores, which still generate more than 80% of the retail industry’s sales.
Best Buy last month ended shopping by appointment-only at its stores, a measure it had implemented to preserve some of its in-person business while shielding staff from the epidemic.


fortune--2020-07-14--In April, 6% of parents expected to quit their jobs because of COVID-19. Now that’s up to 27%

A new survey by parenting benefits platform Cleo comes to a stark conclusion: Things have gotten much worse for working parents since April.
At that early stage of the coronavirus pandemic, only 6% of people who responded to the startup’s survey said they planned to leave the workforce because of the pressures of parenting amid the coronavirus crisis. But in a second iteration of that survey published Tuesday, a full 27% of respondents said they now planned to leave work.
Cleo, a four-year-old employee benefits platform that provides services like lactation consulting and mental-health support to parents of young children, in June surveyed 136 parents of children between the ages of 4 months and 5 years old across 11 of its corporate clients. The companies surveyed spanned the tech, finance, and food and beverage industries—and included not just well-paid white-collar workers, but also delivery drivers and bank tellers.
“I’m not surprised, but I’m still horrified,” Cleo CEO Sarahjane Sacchetti says of the findings.
Balancing never-ending childcare with the pressures of work through the coronavirus pandemic has turned out to be harder than parents expected. The surveys also found that the percentage of new parents who plan to return to work after parental leave has remained consistent over the past three months—but the share who actually go back on time has declined; 83% returned to work when they expected to in April, compared to only 72% now.
Childcare is in even shorter supply now than it was as the country shut down in April. Only about 35% of families reported they had some form of childcare last month, compared to 50% two months earlier.
One of the reason for these worsening numbers may be that help parents expected in the early days of the crisis has not materialized. In April, 53% of respondents said they planned to move closer to family or have family move closer to them during the pandemic; in the June survey, just 28% of respondents said they now have childcare assistance from family.
“Working parents—before COVID hit, we were optimistic, resilient, and creative,” says Sacchetti. “But parents have not been able to materialize those changes.”
And these realities have a significant impact on mental health, especially for women. Women are two-and-a-half times more likely than men, according to the June survey, to say mental wellness is a challenge right now.


fortune--2020-07-14--Meet Dubsmash, the video service stealing some of TikTok’s thunder

Lip-synching stars, video gamers, and fashionistas are turning to Dubsmash to share their short viral video clips amid growing concerns about the security of popular rival TikTok.
During the last week of June, Dubsmash’s weekly downloads worldwide soared 235%, to 511,000, from the previous week, according to mobile app analytics firm Sensor Tower. Meanwhile, downloads of TikTok fell 19%, to 15.4 million.
“Over the past 30 days, Dubsmash has seen a surge of new communities around the world,” Suchit Dash, Dubsmash’s cofounder and president, said in a statement. “The team is working around the clock to help foster a safe, fun, and welcoming environment for all.”
The contrasting momentum between Dubsmash and TikTok coincides with India banning TikTok because of security concerns following a border skirmish between Indian and Chinese military. It also comes as U.S. officials increasingly voice concerns that the Chinese government may be using TikTok to spy on U.S. residents.
Last week, President Trump said he’s considering a ban on TikTok. A few days later, Amazon sent a memo to employees telling them to delete TikTok from their phones “due to security risks.” Amazon later claimed the memo was sent “in error” and declined to provide additional details.
TikTok, which is owned by Chinese company ByteDance, has denied it is a security risk, saying it has never provided user data to the Chinese government and never would, the company said in a statement. In fact, the app recently stopped service in Hong Kong because of a new law there that would allow the Chinese government to demand user data.
In May, TikTok hired a U.S. CEO, Disney’s former head of streaming Kevin Mayer. Following criticism from U.S. officials, the company pointed to Mayer and the hundreds of U.S. employees and leaders working on safety, security, and public policy as a sign of its trustworthiness.
Although users in India have helped with Dubsmash’s big gains in recent months, U.S. users accounted for the majority, or about 47%, of the app’s downloads from April through June, according to Sensor Tower.
Dubsmash was founded in Berlin in 2014 by Dash, Jonas Drüppel, Roland Grenke, and Daniel Taschik to give users a place to post short videos of themselves and dub them with audio from movies and songs. Early on, it gained a large following in Germany before users in other countries started adopting the service. But the app, which had 50 million downloads within six months, struggled to keep its users loyal after many of them flocked to the service to watch videos from celebrities and then never returned.
Then in 2018, younger rival TikTok began its rapid rise, initially for viral dance challenges. Its influence grew, helping Lil Nas X, for example, turn his song “Old Town Road” into a Billboard hit after it went viral on the video service first.
Eventually, Dubsmash’s users had dwindled to the point of putting the company under financial strain. It tried introducing new features, but that ended up accelerating its loss of users. At one point, it considered pivoting to offer enterprise services. Instead, the company closed its office in Berlin, moved back to New York, and started to rebuild the app.
The company declined to comment to Fortune. But in an article they wrote in Fast Company in March, Dash, Druppel, and cofounder Tim Specht said, “We stripped everything about our company back to bare bones, nearly as it was right at the beginning, but without shutting down operations. We let nearly all our staff go.”
Despite Dubsmash’s recent popularity, the app, with 195 million downloads, is still dwarfed by TikTok’s 2.3 billion, according to Sensor Tower.
Dubsmash’s most recent fundraising last year pumped $4.75 million into the company from investors including Index Ventures and True Growth Capital. It has raised $19.95 million since its inception, according to PitchBook.
Now that it is gaining users, Dubsmash hopes to add new features to attract high-profile users, or influencers, who executives hope can attract millions of other users. It also plans to create features to help those influencers make money on its service, much like TikTok does.
Much of Dubsmash’s recent growth has been from video gamers and cosplayers, superfans who dress up as their favorite characters from video games, movies, and books in homemade costumes.
A cosplay TikTok user recently posted a video on TikTok touting Dubsmash as a good “alternative” to the Chinese rival app. But the user, who goes by little_fae_cosplay and has 37,000 followers, cites one key issue: “The only thing it’s missing is the people.”


fortune--2020-07-14--Joe Biden is teaming up with Bernie Sanders to raise taxes—here’s the plan

Presumptive Democratic presidential nominee Joe Biden has laid out the key points in his economic platform—and it’s one that would have been considered verboten in mainstream politics just a few months ago on both sides of the aisle.
He says he’s going to raise taxes.
The former vice president told donors during a digital fundraiser in late June that he was “going to get rid of the bulk of Trump’s $2 trillion tax cut.” In his now-typical Biden tough talk, he added that “a lot of you may not like that, but I’m going to close loopholes like capital gains and stepped-up basis.”
The changes come as Biden partners with Vermont senator and former presidential competitor Bernie Sanders to fold progressive views into his campaign platform and hopefully attract far-left voters this November. Biden quickly followed his announcement with an 110-page plan written by a task force stacked with surrogates from both camps.
The group, cochaired by former Secretary of State John Kerry and Rep. Alexandria Ocasio-Cortez, worked to find common ground and create a new economic policy platform for Biden’s presidential campaign.
During his second presidential campaign, Sanders had one of the most aggressive stances toward taxing the wealthy. In addition to closing loopholes for the wealthy, he said that he would also increase taxes on the middle class, arguably one of the most taboo statements to make in modern-day political campaigning.
An analysis of the proposed tax and spending plans put forth by the candidates during the 2020 Democratic primary found that Sanders wanted to bring in more than $27 trillion in tax revenue over 10 years compared to Biden’s proposed plan of less than $4 trillion.
And now, in a dramatic change of direction, Biden is saddling up to Sanders in an attempt to cocreate policies that appease a wider base of Democratic voters.
“We will work to reform the tax code to be more progressive and equitable, and reduce barriers for families who qualify to benefit from targeted tax breaks,” wrote the task force. “Our tax system has been rigged against the American people by big corporations and their lobbyists, and by Republican politicians who dole out breaks to their biggest donors while leaving families to struggle.”
Here are five key points in Biden’s new economic plan.
1. Tax wages and capital at the same rate.
President Donald Trump’s $2 trillion tax plan, the Tax Cuts and Jobs Act of 2017 (TCJA), created a tectonic shift in the way sources of income are taxed in the United States. After Trump’s changes, capital (things like stocks, real estate, and companies), which the rich tend to accumulate and hold their wealth in, was taxed less than income from labor. In 2018, billionaires paid a lower tax rate than working class Americans, a first.
The current tax system is progressive, meaning income is taxed between 10% and 37% depending on how much a worker brings in. Short-term capital gains (on assets held for less than one year) are also taxed on that sliding scale, but when that capital is held onto for longer than a year, gains are given preferential rates of 0% to 20%.
The Biden platform recommends ending those preferential rates.
“A guiding principle across our tax agenda is that the wealthiest Americans can shoulder more of the tax burden, including in particular by making investors pay the same tax rates as workers and bringing an end to expensive and unproductive tax loopholes,” the report said.
Taxes don’t need to be paid on appreciating investments like stocks unless they’re “realized” or sold. That means that wealthy Americans can sit tight as their investments grow and strategically wait to sell them in a year when they have capital losses to offset said gains.
Or, if they want to pass the assets down to their children when they die, neither parent or child will owe capital gains tax on the assets’ growth in value (more on that later).
2. Increase taxes on the wealthiest Americans by limiting unequal and unproductive tax expenditures.
Wealthy Americans benefit significantly in their taxes from expenditures that provide exemptions, deductions, and credits to specific groups and for specific activities. A recent study by the Congressional Budget Office (CBO) found that the 10 most expensive individual expenditures, which add up to about $12 trillion in lost revenue over a decade, almost entirely favor the rich.
Those expenditures include the exclusion of employers’ contributions for employees’ medical insurance premiums and medical care, a preferential rate structure for capital gains and dividends, benefits for tax-qualified retirement saving accounts, exclusion of capital gains at death, and deductions for charitable contributions.
These expenditures are, in theory, supposed to help promote policy goals. Funds for college expenses can grow tax-free in special savings accounts, for example. But creating an “upside-down,” expenditure model gives the largest subsidies to high-income Americans, the people who are least likely to need financial incentives to engage in those activities.
Nearly 60% of all tax expenditure benefits go to those in the top 20% of income earners, according to analysis by the Center on Policy and Budget Priorities. About one-quarter of the benefits go to those in the top 1%.
In their paper, the Biden-Sanders task force recommended increasing taxes on the wealthiest Americans by limiting tax expenditures “as a means of strengthening tax progressivity and paying for investments in U.S. productivity.”
3. Increase corporate tax rates.
As part of his tax plan, Trump cut corporate tax rates in the U.S. from 35% to 21%—a reduction of 40%. The President claimed that this cut would trickle down and increase household income by $4,000 on average.
But a recent study by Brookings found that the reduction in revenue collected from businesses did not pay for itself, as the President initially claimed it would. Instead, corporate tax revenues fell 31% in the first year after the cut was passed, adding to the deficit.
Americans did not see a trickle-down benefit in their paychecks, either. Worker pay remains about the same as it did before, and bonuses handed out at the beginning of the tax cut did not last beyond a quarter or two.
“Corporate tax rates, which were cut sharply by the 2017 Republican tax cut, must be raised, and ‘supply-side’ or ‘trickle-down’ tax cuts must be rejected,” the task force’s report said.
Biden has said he will raise corporate tax rates to 28%, still well below the pre-TCJA rates. The Tax Foundation General Equilibrium Model estimates that the proposal would raise about $1.5 trillion between 2020 to 2029, on a conventional basis.
4. Increase estate taxes back to their norm.
Before the TCJA, any assets from estates (cash, real estate, stocks, and other assets) valued at less than $5.49 million (or about $11 million for couples) were exempt from being taxed when passed down from deceased persons to their heirs. Anything over that threshold is taxed at about 40%.
Trump more than doubled the exemption in 2017 to $11.4 million per person or about $22.8 million for couples.
Many Republicans argue that estate taxes hurt ordinary Americans attempting to pass down property to their families. Farmers in particular, they say, own vast swaths of highly valued land.
But an analysis by the Tax Policy Center estimated that in 2017, before the new rules were implemented, only 50 farms owed money under the estate tax and that the tax worked out to an effective rate of less than 6% on each estate.
The change instituted by Trump dropped the number of estates in the United States being taxed from an estimated 5,500 to 1,700 in 2018, but tax revenues from the estate tax dropped by only about a third, from $20.4 billion to $13.6 billion.
5. Expand the Child and Dependent Care Tax Credit.
The task force recommends expanding the Child and Dependent Care Tax Credit (CDCTC) “to provide a fully refundable, advanceable tax credit.”
The credit is meant for working parents who pay out-of-pocket expenses for childcare. There’s no income restriction on claiming the credit, but those who bring in less money are able to claim a higher percentage of expenses, up to $3,000 per dependent or up to $6,000 for two or more dependents. That includes the costs associated with day care, summer camp, after- and before- school programs, and babysitters.
Because the program is currently nonrefundable, it can only be used to offset income tax owed, so low-income families who owe very little or no tax do not get to make use of it. Under the current structure, only about 12% of families with children benefited from the CDCTC in 2020, according to the Tax Policy Center. Biden’s platform would change that, opening up the rebates to all families with dependent families, regardless of income.


fortune--2020-07-14--Delta plans to continue blocking middle seats on flights into fall. Why that’s good business

Surging coronavirus cases and the stalled U.S. reopening have undercut Delta Air Lines’ summer travel plans—and will continue keeping its planes relatively empty into the fall.
The airline on Tuesday halved the number of flights it had planned to add in August, citing stalled demand as COVID-19 infections rise around the country. Delta also said it is likely to continue to guarantee passengers empty middle seats beyond the end of September, a sharp divergence from Delta’s largest domestic competitors.
“We’re committed to blocking middle seats through September and expect to continue our policy beyond that date as well,” CEO Ed Bastian told analysts during a conference call Tuesday to discuss the airline’s second-quarter results.
As the airlines try to contain the pandemic’s sweeping damage to their business and the near-total shutdown of air travel this spring, Delta is betting that allowing more distancing between its passengers is worth taking a greater short-term financial hit. The airline is keeping its flights relatively empty by not selling its middle seats and by capping each flight at 60% capacity in coach cabins.
That’s a sharp difference from American Airlines, which this month ditched its limits on cabin capacity and started selling all of the seats in its planes. United Air Lines has also dismissed the effectiveness of blocking middle seats as “a PR strategy, not a safety strategy.”
Bastian disagrees. “This is to us a really important safety feature. It’s a health crisis that we’re in,” he told analysts Tuesday, adding that Delta is reaping the benefits in positive customer feedback.
While the airline is losing money short-term by not filling planes to capacity, it is not raising fares to account for the blocked middle seats, Bastian said. This extra space on board planes has now become “the No. 1 reason why customers are choosing Delta,” he added. “Everyone appreciates it’s not going to last forever—but in the face of a health crisis, that space on board really matters.”
Fewer road warriors
Delta reported a net loss of $5.7 billion in the second quarter, swinging from a profit of $1.4 billion a year ago. After adjusting for restructuring charges and accounting related to the CARES Act that threw the airlines a federal lifeline, Delta’s second-quarter loss was $2.8 billion, compared to a year-earlier profit of $1.5 billion.
Bastian also reiterated that Delta does not expect to see air travel resume its pre-pandemic levels before at least 2022.
“Given the combined effects of the pandemic and associated financial impact on the global economy, we continue to believe it could be two years or more before we see a sustainable recovery,” he told analysts.
He also predicted that the expensive business travel that provides 50% of Delta’s revenue will be fundamentally changed by the pandemic and the now-ubiquitous Zoom calls that have almost entirely replaced in-person meetings this year.
“I don’t think we’ll ever get back to where we were in 2019 on the volume of business traffic,” Bastian said. “The number of trips the average road warrior takes is going to come down in certain cases. The international trips that we’ve all been on—where we’ve flown over to Europe for a meeting and flown back, that does nothing but eat you up—can certainly be much easily better accommodated over a video call.”
But Bastian does eventually anticipate a meaningful return of his higher-paying business customers, once companies feel safe putting their employees back on planes for relationship-building purposes (and once more countries allow Americans to travel abroad again). “Fundamentally I think business travel is going to come back, and it is going to come back at scale,” Bastian said.