fortune--2020-05-26--‘I can be more vulnerable:’ Citi President Jane Fraser on female leaders’ pandemic-era advantage

Good morning, Broadsheet readers! WNBA commissioner Cathy Engelbert talks the future of live sports, Brené Brown is our collective therapist, and Citi’s Jane Fraser reflects on leading in a pandemic. Have a terrific Tuesday.
– Vulnerability as an advantage. For the latest installment of Fortune‘s interview series about female leadership amid the coronavirus crisis, I talked to Jane Fraser, president of Citi and CEO of its global consumer banking division. Fraser shared what data she’s monitoring (community spread, public infrastructure) and what Citi’s pandemic-era offices will look like (one-way walking routes and lots of plexiglass).
Of course, the pandemic is reshaping more than companies’ physical workspace. Fraser said the crisis is an opportunity to “smash some of the myths of how you’ve done stuff in the past,” especially as it relates to talent. She explained, for instance, why Citi offered full-time jobs to most of its summer interns before their (abbreviated, all-virtual) programs began. It took “the stress out of the system,” she said. “This way they’ll make the most of the experience…rather than stressing about, ‘How am I able to show myself when I’m not sitting there with my manager?'”
I was especially interested, however, in Fraser’s frank reflection on her own leadership:
People do look for leadership at a time like this. Being a woman has real power and strength to it. I can be much more vulnerable in certain areas; talking more about the human dimensions of this than some of my male colleagues feel comfortable [with], and I don’t feel that’s in any way soft or weaker. I actually think it’s much more powerful. I find that I’ve been able to have a conversation with our people, across the bank, that I wouldn’t have been able to have in that same way had we not had a crisis. You can build a different relationship with the people in the organization than you’ve been able to before.
The comment is reminiscent of analysis of how female heads of government have responded to the crisis. Leaders like New Zealand’s Jacinda Ardern and Germany’s Angela Merkel have not masked the crisis as a physical war against an invisible enemy, as this NPR story points out, but have instead characterized it as a shared problem that calls for shared responsibility—with stellar results.
You can read Fraser’s full interview here—including her tips for drawing a line between the office and home.
Claire Zillman
claire.zillman@fortune.com
@clairezillman
ALSO IN THE HEADLINES
- Hoop dreams. WNBA commissioner Cathy Engelbert joins Fortune's Leadership Next podcast this week. With live sports halted, Engelbert and her team are trying to engage the fans they already have and bring in new ones. In April, the league held its first-ever virtual draft from Engelbert’s home; the broadcast on ESPN captured the event's biggest audience in 16 years. “We need to look at the opportunities in this crisis,” she said. “And I think there is an opportunity to engage fans in a different way.” Listen and subscribe: Spotify
- Bat signal. Virologist Shi Zhengli, known as 'bat woman' for her work studying the animals, warns that the discovery of viruses like COVID-19 are “just the tip of the iceberg” and is calling for international cooperation to fight against epidemics and avoid human suffering. Bloomberg
- Under control. A new birth control gel marketed as Phexxi by Evofem Biosciences is the first non-hormonal contraceptive to win FDA approval in decades. The approval last week heralds a rare new option in the pill-dominated contraceptive market. The last wholly new type of birth control without hormones was the female condom, which got the FDA O.K. in 1993. Bloomberg
- Making the cut. The Air Force has removed the minimum height requirement for prospective pilots as it seeks a more diverse pool of applicants, particularly women. Previously, officer applicants who wished to fly had to be between 5-foot-4 and 6-foot-5. The Air Force approved most height waivers, but on paper the requirement effectively eliminated about 44% of American women between the ages 20 and 29. New York Times
IN CASE YOU MISSED IT
- Feeling seen? Fortune's Danielle Abril reports on how the pandemic is complicating diversity efforts. “If you are a member of a group that’s marginalized or underrepresented, it’s already hard to be visible,” said Evelyn Carter, director at diversity and inclusion consulting firm Paradigm, on a panel on the topics last week. “It’s especially exacerbated right now.” Fortune
- 'America's therapist.' Brené Brown, the best-selling author and academic, was already a pop culture icon when the pandemic hit. But now her new podcast Unlocking Us is a chart-topper. It's not just that shelter-in-place orders are heightening listeners' demand for her insight into human connection. She suspects another appeal is that she’s transparent about her own limitations and struggles. Texas Monthly
- What he said. The pandemic has minted a new kind of TikTok star; women who lip-synch President Donald Trump's coronavirus comments. Sarah Cooper and Kylie Scott are two masters of the method. “The more I get into impersonation, the less funny it becomes,” Cooper says. “I’m trying to present the words as me, Sarah Cooper, as earnestly as possible.” Washington Post
ON MY RADAR
Amy Schumer misses stand-up New York Times
With no childcare or summer camps, women are being edged out of the workforce Washington Post
Regan Smith: No swimming, no Olympics, no graduation. No complaints New York Times
PARTING WORDS
"Quite a decent shake."
-New Zealand Prime Minister Jacinda Ardern, as an earthquake struck while she was on live TV.


fortune--2020-05-26--Why Citi offered full-time jobs to its interns—before summer even started

The global liquor industry might not fully recover for another five years

How did Citi initially respond to the coronavirus pandemic? It bought “every personal computer imaginable,” said Jane Fraser, Citi president and CEO of global consumer banking.
Citi, like so many companies, moved most employees to remote work amid the COVID-19 outbreak—with exceptions for some branch and critical infrastructure workers—and the computer purchases ensured that staffers who had to work from home were well-equipped to do so.
The shift happened without a hitch, Fraser told Fortune last week. In fact, “we closed the books for the bank without one person from finance in the office two days earlier than we normally do,” she said.
With that immediate fire drill over, concerns about the longer-term effects of the pandemic and workers’ extended work-from-home routine have emerged.
One worry was about Citi’s summer analysts. The bank in April announced a change: It would give full-time job offers to all interns in New York, London, Hong Kong, Singapore, and Tokyo, so long as they graduated and met the minimum requirements of Citi’s abbreviated, fully virtual summer program.
Many of the interns would’ve received offers anyway, but the early action took “the stress out of the system” amid the unprecedented circumstances, Fraser said. “This way they’ll make the most of the experience…rather than stressing about, ‘How am I able to show myself when I’m not sitting there with my manager?’’’
The crisis offers an opportunity to “smash some of the myths of how you’ve done stuff in the past and come up with new ways that will just make talent perform better,” she said. If employees feel that the organization supports them, “they do a good job looking after each other on their teams and after our clients.”
“It’s such a simple thing,” she said. “But you often can forget that in a big organization.”
Fortune’s interview with Fraser is the latest in a series that asks female business leaders—including those who appear on Fortune’s annual Most Powerful Women in Business lists—to talk about leading through the public health and economic crisis. This interview has been edited and condensed.
Fortune: Citi has arguably endured the initial effects of the coronavirus crisis better than most. It hasn’t laid off any workers; it gave $1,000 bonuses to 75,000 of its lowest-paid employees. Its business is still essential to customers and clients. What about in the longer-term; how do you see the bank’s business changing, if at all?
Fraser: You’ve certainly got to pivot to digital; the use of channels will change a lot. Folks will want less face-to-face. When you want advice, you want to talk to a human being, and thank goodness. But when it comes to paying bills, sending money around…all the service things will get supercharged to digital; that’s one big change.
Another is the way we interact with clients. We’ve been putting a lot of work into how you make the Zoom experience better than the meeting experience: how you use [Zoom] Rooms—you can break people up [into groups], you can bring people in, and you can use experts much more productively than when they had to travel. I think we’ll see a lot less travel to client meetings; clients not wanting it and everyone being much more comfortable in a virtual environment.
The areas we’ll have to put thought into are going to be the cultural side of things. If you join an institution and you have more of a remote experience, how do you assimilate into that culture; how do you feel that sense of belonging? There really is something missing from just the interactions you have when you see someone at work. It’s gotta be more orchestrated. Those are some of the areas where we have to make sure organizations don’t lose their soul and lose the connection and warmth [of] human beings.
What management lessons or principles are you drawing on as you face this unprecedented crisis? What, if any, road map are you following?
Our head of crisis management was in charge of the 9/11 response for New York City, so he is used to how to do this and our medical team as well. First, you have to make decisions at crisis speed, and you have to go into more of a command and control approach. You have to use data to drive decisions; that’s even more important for the return [to the office]. Our employees…everyone has been fearful of the return: “Would it drive off a date? Would I go back?” In practice, it’s much more about, When is it safe to go back? And what data are we going to use so people know that it is safe to return? Things like public transport, community spread, health care services being back online. Decisions [are] being driven by data and then [communicated] transparently, over and over again, so our people understand how they are made. [With that approach], there’s a lot more faith, [rather than it being] a grand pronouncement.
Another principle is about helping our customers. The last crisis was a financial crisis at its root; this is a health care crisis. Our job is to be part of the solution here. One of the principles we’ve had is with government programs. We view it as our job to help administer those programs and get money into people’s hands—not to make money from them. There’s a big effort with small business in the U.S.…We’re going to donate all our net profit to small-business charities and funds because it sits ill with us that we’d make money off small businesses that are going through such a tough time.
What data in particular are you monitoring as you consider returning to the office?
A lot of it is around community spread. What’s the status of the disease, and have we had a sustainable period [of containment]? Have health care services returned to normal so if you have another illness can you go to the hospital and get treated? What’s the state of public infrastructure? For our people in a big city, is it safe to commute in, and, if not, can we provide alternatives?
Then it’s looking at which local governments or states have started opening up. But we don’t rush to go back. We learned this in Hong Kong when the first wave ended; we kept everyone at home. A lot of people moved back into offices. We said, “Just wait; let’s see, because it takes about two or three weeks before you start seeing hospitalizations rise.” Sure enough, there was a resurgence, and everyone had to go back home again. I think our employees felt relieved that we’d waited and not pushed them into the office. We’re guided by what local governments say, but we’re not going to front-run them or we’re going to wait and see how it goes.
What—if any—good do you think will come from this crisis?
You see human beings for who they are in a wonderfully authentic way. Like, I love it [on virtual calls] when someone’s kid runs in, or the printer goes off with someone’s homework, or the cat walks across the screen, or you hear the kids screaming in the background…and it’s very equalizing. On a Zoom call, you can be the CEO or you can be an analyst; you’re occupying the same real estate on that screen. So I see it flattening organizations a lot more.
The bit that I think we all hope for is that we don’t leave people behind in the process. Running a consumer bank you really see it; a more compassionate approach to running companies, to how we look after customers…I really hope that comes through, because if it doesn’t, we’ll end up with even more polarization. We can all work from home, but there are a lot of people who tend to be lower income who can’t, and they have to get back. There’s already more of a recognition that we can’t just be in our microcosm; we’ve got to have some responsibilities here.
In some parts of the world, some of Citi’s offices have reopened. What do those workspaces look like now?
In the lobbies, there’s one way in and one way out. In the elevator, there are footprints as to where you stand. You don’t want to talk to someone in an elevator, because you’re closer and droplets go…So people are asked not to talk in elevators.
There are one-way stairways and one-way walking paths around the office, so you’re not crossing with folks. Chairs are spaced out. There’s plexiglass between cubicles that had been completely open. (They’re glass so you don’t feel as if you’re in a cell, which is very important.)
We’re staggering hours, so in a bigger city, [employees] can come in earlier or later if they’re worried about commuting. The cafeterias and buffets are shut so we’re giving people more time at lunch.
Most of the client work is still remote. There are a few client meetings going on in person, but everyone’s got used to Zoom so they’re using it that way.
People who are vulnerable, we pay them, and they stay at home.
You’ve got silly things like etiquette for the bathrooms, because the spacing is not so good in there. And there’s a lot of cleaning; a lot of visible cleaning.
It’s not like it used to be, but it’s not so very different either. So for those who do want to go back, they don’t go back and say, “Oh, this is worse than being at home.” There are some pros and cons. Quite a few people are working a few days in the office and then at home the rest, and we’re fine with that.
If [employees] don’t want to come back [to the office], they don’t have to, as long as they’re able to work from home, or if they’re ill or vulnerable. For some folks childcare is a big issue; you’ve gotta give people flexibility.
What’s the biggest way your professional life has changed amid this crisis?
People do look for leadership at a time like this. Being a woman has real power and strength to it. I can be much more vulnerable in certain areas; talking more about the human dimensions of this than some of my male colleagues feel comfortable [with], and I don’t feel that’s in any way soft or weaker. I actually think it’s much more powerful. I find that I’ve been able to have a conversation with our people, across the bank, that I wouldn’t have been able to have in that same way had we not had a crisis. You can build a different relationship with the people in the organization than you’ve been able to before.
What’s the biggest way your personal life has changed in all of this?
The thing I’ve personally found the hardest is there is no line between the office and home. I think we’ve all found that hard. It’s too easy to keep on working because it’s so easy to find everyone and connect with everyone. Someone told me the other day, “You’re a wartime general. It’s not sustainable. You’ve gotta get into more of a [business as usual] mode. And if you’re worth anything as a leader, you’ve gotta start role-modeling that, because there’s no way the organization’s going to change unless you do” Hard advice to follow.
Have you developed any tricks for cutting yourself off from work?
I get very hungry. I get absolutely ravenous; it’s intense work! So at lunch, I take a bit of time to go and chop some vegetables. It’s very therapeutic, and I switch off. The same in the evening. But my poor husband and one of my teenage sons are [joining me] this weekend, and they’re gonna be on cooking duty. I’ll have to find something else to do.


fortune--2020-05-26--VPN demand in Hong Kong reveals a new fear: Beijing weaponizing the Internet

Tear gas was still fresh in the air as Lee, a 33-year-old demonstrator, watched a line of protesters trade insults with riot police in downtown Hong Kong on Sunday during a lull in the city’s largest anti-government demonstration since 2019.
Dressed in all-black and wearing a surgical face mask, Lee, who shared only his surname to avoid being identified by authorities, said that he was there to oppose the new national security law that China’s government proposed for Hong Kong on Thursday. Beijing says the law is intended to prevent and punish acts in Hong Kong that threaten China’s national security. Critics believe it will be used to diminish freedoms guaranteed to Hong Kong when the U.K. handed the city over to China, such as the right to protest, a free media, and an independent judiciary system.
“I’m not afraid of China, and that’s why I came here today,” Lee said. But even as Lee felt emboldened to publicly protest Beijing’s growing influence in Hong Kong, his fears about the fallout manifested elsewhere. Hours after Beijing’s announcement, Lee downloaded a virtual private network (VPN), which conceals his Internet activity by routing his connection through servers around the world. As Beijing asserts more control over the self-governing region, Lee is increasingly worried about his digital privacy.
He’s not alone.
Shortly after Beijing announced the new law, NordVPN said inquiries for its services shot up by a factor of 120. Surfshark, another VPN service provider, said it sold a week’s worth of subscriptions in the hour following the news. Other providers like ProtonVPN and Atlas VPN have similarly reported surges in traffic and sign-ups from Hong Kong users.
The national security law does not specifically address online freedoms, and Chinese officials say the government is determined to uphold the “one country, two systems” precedent that provides Hong Kong with relative independence from Beijing. On Tuesday, Hong Kong chief executive Carrie Lam said at a press conference that people in Hong Kong have the freedom to say whatever they want “for the time being.”
Yet the concerns of protesters and other Hong Kong residents are not without merit. In mainland China, the Internet is one way Beijing restricts information and quashes dissent. Its “Great Firewall” blocks foreign websites like Facebook and the New York Times and censors domestic news and social media platforms. Foreign and domestic companies alike employ VPNs to bypass the restrictions and communicate more easily with counterparts overseas. The VPNs, however, are often slow, cumbersome, and subject to periodic clampdowns that can make business more difficult.
Hong Kong, meanwhile, still enjoys unrestricted access to the web, a trait that bolsters the city’s appeal for foreign firms and talent looking to do business in the region. But Beijing’s new national security law may open the door to Internet interference.
“Hong Kong people might need to face the reality that free speech and online speech is probably not protected as much as before,” said Jyh-An Lee, a professor focusing on Internet law at the Chinese University of Hong Kong Law School.
Private information
Lee, the protester, said he downloaded a VPN not because he thought the Chinese government would soon restrict the Internet, but rather because he’s “really afraid that the [Chinese Communist Party] will get my personal information.” Of the eight protesters Fortune spoke to on Sunday, seven had downloaded VPNs. The lone holdout said he planned to get one in the coming days.
Several of the protesters echoed Lee’s concerns that the new national security law would provide the Chinese government with legal means to make arrests over online content.
Lee, the law school professor, says that Beijing’s proposed language for the law banning seditious activities, foreign interference, and terrorist acts is indeed “deeply concerning” for the future of online speech in Hong Kong. Fang Ke Cheng, an expert in Chinese digital media and censorship at the Chinese University of Hong Kong’s School of Journalism, says Chinese authorities could use it to force Hong Kong’s Internet service providers to turn over user data. The Chinese government is unlikely to suppress Internet freedoms or online activists en masse, Fang says, but could instead target a few individuals.
A recent case involving former independent Hong Kong bookseller, Causeway Bay Books, is an example of how such government action could play out. In 2015, five employees of the store, known for selling politically sensitive titles, disappeared. The how and why of the case remain shrouded in mystery, yet many attribute the disappearances to orders from Beijing.
“There hasn’t been a widespread crackdown on bookshop owners, but that one case is enough to create an environment where everyone is afraid [for] their safety,” Fang said. Similarly, Beijing may punish a few prominent websites or Internet users to instill fear among the wider online public, Fang added.
In that sense, the law may have a “chilling effect,” discouraging online activism and prompting self-censorship, professor Lee said.
Online mobilization
At least some protesters are keen to continue their movement online, even if adjustments must be made.
“After the security law, we will have to find new ways to go on the Internet and discuss our protest methods,” said So, a protester in his mid-twenties who wanted to keep his full name private for fear of being targeted by authorities.
Mass rallies began in Hong Kong in June 2019 in opposition to a proposed extradition bill in the city’s legislature, which opponents said would enable the Chinese government to extradite Hong Kong political prisoners and try them on the mainland. In the following months, the cause grew into an enormous anti-government protest movement with help from online platforms.
A local Reddit-like online message board called LIHKG has provided a space for activists to post new articles, discuss tactics, and organize new protests. The encrypted messaging app Telegram was also popular among organizers.
If protesters have to find alternative means to communicate online, VPNs appear to be the first step.
“The awareness of Internet security is quite high in Hong Kong,” said a 27-year-old protester and VPN user who went by the name Chan. “We are prepared for the worst.”
Additional reporting by Eamon Barrett and Naomi Xu Elegant


fortune--2020-05-27--Stocks and euro soar as EU gets set to unveil a €750 billion stimulus plan

‘ Stay at home stocks ’ continue to surge—this one now has a P/E ratio of over 1,000

The European Union’s executive arm will propose a new fiscal stimulus package of as much as 750 billion euros ($823 billion) in an unprecedented push to overcome the deepest recession in living memory, according to a tweet by European Commissioner Paolo Gentiloni.
Of the total amount, 500 billion euros from the package will be distributed in the form of grants to member states, and 250 billion euros could be available in loans, according to an official, who asked not to be named, in line with policy. To fund the package, the EU would borrow up to 750 billion euros on financial markets.
Commissione propone un Fondo di Recovery da 750 miliardi che si aggiunge agli strumenti comuni già varati. Una svolta europea per fronteggiare una crisi senza precedenti. #NextGenerationEu — Paolo Gentiloni (@PaoloGentiloni) May 27, 2020
Italy would get 81.8 billion euros under the proposal, Spain 77.3 billion euros, Greece 22.5 billion euros and France 39 billion euros, according to another official familiar with the details. Peripheral EU bonds rallied on the news.
Italian bonds rallied, with 10-year yields falling eight basis points to 1.47%, the lowest level in almost two months, while German securities erased gains. The euro snapped losses on the proposal, and was at $1.0979 as of 10.30 a.m. in London.
The long-anticipated blueprint, which will be presented Wednesday by European Commission President Ursula von der Leyen, will form the central plank of the EU’s response to the devastating impact of the coronavirus pandemic. The outbreak, which has claimed hundreds of thousands of lives around the world, has hit every European economy, with the worst-affected predicted to contract by almost 10% this year.
The money would largely fund investment and reforms, while some funds will also go to significantly beef up healthcare and to the EU’s poorest regions to help them catch up. The bloc will also offer guarantees from its budget in order to boost private investments via temporary equity support to viable companies or more capital for sectors of strategic importance such as critical infrastructure, technology and healthcare.
An accord on the plan will require the backing of all 27 EU members and could be a watershed moment for the bloc, where financial burden sharing has long been one of the thorniest issues that’s held back deeper integration. It could quell concerns that a lack of solidarity is empowering populists threatening the EU’s very survival.
An agreement could also relieve some of the pressure on the European Central Bank, which has so far taken the lead in the EU-level response, pledging to buy more than a trillion euros of debt to stabilize markets.
The commission’s proposal follows a joint push by France and Germany earlier this month that asked for the EU to borrow 500 billion euros that could then be allocated as grants. The initiative marked a stunning volte-face for Berlin and signaled a major shift toward bolstering the union’s financial power.
Giving help via grants rather than loans has been a key ask by hard-hit EU countries such as Italy and Spain, where increased borrowing to fund the recovery could quickly push debt to unsustainable levels. But even with Germany’s blessing, the plan is bound to face pushback by the bloc’s more stringent members as well as small nations in the region’s east.
Following the proposal by Paris and Berlin, Austria, Denmark, the Netherlands and Sweden released their own blueprint that would instead offer loans to countries rather than grants and would expire after two years, while they’ve insisted that any help has conditions attached to it. As net donors to the EU budget, the so-called Frugal Four are sceptical of a major borrowing spree that could leave their taxpayers on the hook for decades to come.
Meanwhile, poorer peers in central and eastern Europe are also wary of being asked to dole out more money, especially when they risk having funds redirected from them to richer – though harder-hit – nations.
Still, even some of these hardline governments have signaled in recent days that they are open to discussing recovery plans without dismissing any outright, leaving the door open to a possible compromise.


fortune--2020-05-27--How Chipotle’s past food crises prepared it for the COVID-19 outbreak

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Chipotle Mexican Grill is faring relatively well during the COVID-19 pandemic, and it has its traumatic food safety scandals from a few years ago in part to thank.
In 2015, the fast-casual burrito chain dealt with an E. coli outbreak, followed by other food safety problems, that decimated its business for a long time; comparable sales fell by one-fifth the following year.
To win back customers, Chipotle changed how it prepared food—practices that inadvertently readied it for the current pandemic. The protocols included washing hands between every task, putting hand sanitizer at the door, and changing air filtration systems, measures prescribed by the Centers for Disease Control and Prevention, as well as local health authorities, for the current crisis.
“We already had a well-being and a food safety culture in place,” Chipotle chief executive Brian Niccol tells Fortune. Chipotle has also added measures to ensure social distancing, among other newer moves.
That has also had the benefit of giving Wall Street confidence Chipotle could weather the current crisis despite sharp drops in sales. Since Niccol took the reins in March 2018, Chipotle’s shares have more than tripled, passing the $1,000 mark for the first time last week. In 2019, Chipotle’s sales came in at $5.59 billion, 15% more than a year earlier but just short of what it needed to make it onto the Fortune 500 list.
While Chipotle is taking a hit from ongoing lockdowns in many major markets—and millions of Americans are working from home and therefore not patronizing a Chipotle in a business district—the chain is holding its own: Comparable sales, which excludes newly opened or closed stores, fell as much as 35% on weekly basis in late March, but, in April, that had moderated to a drop of a high-teens percentage. Chipotle had been on a tear in January and February with comparable sales up 14%.
Another factor that has helped Chipotle during the COVID-19 crisis has been its app and website, something Niccol made a top priority since taking the helm after a stint as CEO of Yum Brands’ Taco Bell chain.
“That’s how people are going to want to access food and restaurants moving forward,” Niccol says. And that has proved instrumental to the vast majority of restaurants still closed to in-store dining. Right now, some 70% of orders are placed digitally, up from 20% before the crisis, and Niccol thinks that could stabilize around 40% once things normalize.
Chipotle offered free delivery in partnership with Uber Eats, another move that has spurred adoption of the app. “The pivot to having the dining room closed was one that we were flexible and capable of doing because we’d made those investments,” says Niccol.
The loyalty program, largely supported by the app, was launched in April 2019 and now has 13 million members, including 2 million who signed up last month alone. You only have to look at Starbucks’ wildly successful app to see how crucial apps are to hanging on to business while stores are mostly closed. Chipotle’s digital sales crossed the $1 billion threshold last year.
Another key initiative that predates the pandemic but has proved extremely helpful: Chipotle has set up “digital kitchens” to speed up the preparation of online orders, along with mobile pickup shelves. That has meant setting up a separate area at almost all Chipotle restaurants dedicated solely to online orders while in-store orders are prepared before the customer from behind plexiglass separators. For now, both are operating at many stores since most locations allow customers to come in and place an order to go.
Typically, there are seven or eight people on a Chipotle assembly line, but these days it’s more like four. “We can’t have them be shoulder to shoulder right now,” says Niccol.
Even as lockdowns start to ease, and dining rooms reopen, Niccol thinks digital sales will continue to be valuable, offering an alternative to customers wanting to minimize time in the restaurant.
“People will want to get their food and take it to an off-premise location where they feel comfortable,” he says.
At the same time, Niccol says, he senses a desire among customers to be able to eat in again as well, pointing to two customers he spoke to inside a restaurant on a recent visit to an Atlanta-area Chipotle. “They enjoyed having a different place to eat their food than in their car,” he says.


fortune--2020-05-27--Coinbase acquires crypto trading firm Tagomi in all-stock deal

Cryptocurrency giant Coinbase announced on Wednesday that it has acquired Tagomi, an upstart firm that specializes in crypto trading for institutional clients.
The companies did not disclose an acquisition price, but a person close to the deal said Coinbase paid entirely with its privately held stock. The person added that media reports in November—which described a rumored $150 million price tag—significantly overstated the value. Meanwhile, a source familiar with Tagomi said the price was close to $100 million and added that Coinbase outbid rival crypto giant Binance to land the deal.
New York–based Tagomi arrived late to the crowded market for cryptocurrency services, launching in December 2018, but gained attention for an executive team that is composed of veterans of the traditional financial world. Those include Greg Tusar, the former head of electronic trading at Goldman Sachs, and Jennifer Campbell, a hedge fund veteran and partner at Union Square Ventures. Tagomi’s financial backers include billionaire tech mogul Peter Thiel.
In an interview with Fortune, Tusar says his team launched Tagomi to fill a void in the crypto markets by providing an electronic trading service to institutional investors with deep pockets. Prior to Tagomi’s arrival, he explained, large traders had to rely on so-called over-the-counter desks, which arrange one-off transactions between two parties looking to buy and sell Bitcoin and other cryptocurrencies without the broader markets knowing.
According to Tusar, trading infrastructure for cryptocurrency is evolving in the same way as it did for equities and commodities; initially, trading involved labor-intensive systems before gradually shifting to more efficient ones.
According to Coinbase chief operating officer Emilie Choi, the Tusar deal is part of a larger plan to pursue strategic acquisitions. In the case of Tagomi, the deal will expand the ability of Coinbase—whose bread-and-butter has long been retail investors—to serve institutional investors, including funds and wealthy individuals.
Choi added that Tagomi will initially operate as a stand-alone brand, but that, over time, it would likely be folded into Coinbase Pro, a service that caters to professional traders. Tusar and Campbell both told Fortune they plan to stay on at Coinbase, which is based in San Francisco.
The Tagomi deal comes at a time of consolidation in the broader cryptocurrency industry, in which several companies have snapped up smaller players in a bid to become the crypto equivalent of full-service banks—offering loans, custody services, and more. In addition to Coinbase, those include BitGo, which recently bought a trio of smaller firms, and Genesis Capital, which last week bought a London custodian as part of a bid to brand itself as a prime broker.
More coronavirus coverage from Fortune:


fortune--2020-05-27--‘Stay at home stocks’ continue to surge—this one now has a P/E ratio of over 1,000

Stocks and euro soar as EU gets set to unveil a €750 billion stimulus plan

The times may be uncertain, but one thing isn’t: Investors are paying up for some of the most popular stocks right now.
Some stay-at-home stocks have seen tremendous run-ups in price in recent months as the coronavirus has changed consumer behavior drastically during shelter-in-place orders across the country that are only now starting to lift.
The beneficiaries of stay-at-home trends include the likes of Amazon, which has been hitting all-time highs in recent weeks and now has a P/E of around 116 times trailing earnings. Netflix has also posted all-time highs in recent weeks, with the stock now trading at around 87 times trailing earnings. Semiconductor titan Advanced Micro Devices (or AMD) is trading on the higher end as well, at around 129 times trailing earnings, and payments app Square also isn’t coming cheap, trading at about 123 times trailing earnings. Others like online marketplace Etsy have also seen a run-up, with the stock (up over 130% since March) now trading at a hefty 126 times trailing earnings.
But perhaps the wildest valuation case is Zoom Video Communications. The videoconferencing company many homebound employees are now very familiar with has seen its stock shoot up over 150% year to date. With that meteoric rise, Zoom’s P/E is now off the charts—literally. S&P Global assigns the stock’s P/E a “NM” or “not meaningful” rating, as its price has split so far from its underlying earnings. Fortune manually calculated its P/E—dividing the stock’s current price by its earnings per share—and got a stunning figure of more than 1,000 times trailing earnings.
Those elevated valuations come against the backdrop of a market that has rebounded significantly since late March. In fact, according to a recent LPL Financial research note, the market as a whole is trading at around 20 times the next 12 months’ earnings, making multiples for the S&P 500 overvalued based on historical averages (and the “highest level since the tech bubble in the late 1990s,” the firm said).
Says Jeff Buchbinder, equity strategist for LPL Financial, “We’re pleasantly surprised at how quickly the market has looked forward to the recovery in 2021 and 2022,” he tells Fortune. “But no doubt on near-term earnings, stocks are expensive.”
Some strategists like Buchbinder suggest capital markets are wanting to give companies benefiting from the shutdowns the capital to take advantage of their market opportunity now. “Whether you’re talking about videoconferencing or finding a cure, there’s a lot of winners in this environment for sure, and the market is clearly recognizing that,” he says.
“When economic growth is challenged and some stocks stand out in terms of the growth they’re delivering, it makes sense they would demand premium valuations,” adds Buchbinder. Based on growth he’s seeing looking ahead, some of the bigger FAANG stocks “are going to grow into their earnings, and they’ll look cheaper in a couple of years,” Buchbinder suggests.
On a forward (or next 12 months) basis, many companies like Netflix, Amazon, and Etsy are estimated to have price-to-earnings ratios that are more reasonable. But as earnings en masse are expected to falter this year, analysts note markets generally are overlooking 2020 earnings altogether. Instead, they’re looking to how companies might recoup losses with earnings in 2021 or 2022 to justify those hefty price tags now. “Looking at earnings two, three years out, then I think you can start to assess whether a P/E ratio is reasonable,” notes Buchbinder. In fact, that’s how LPL Financial is valuing stocks based on their earnings, “given how depressed they are,” the firm said in a note Tuesday. For companies like Amazon or Netflix, estimated forward P/Es in fiscal year 2021 look more down-to-earth: Netflix’s forward P/E is estimated at around 50 times earnings, while Amazon’s is around 68 times earnings, according to S&P Global data. (Zoom’s, meanwhile, would still be over 200 times earnings for fiscal year 2021.)
Yet with so many companies suspending earnings guidance, and continued uncertainty over what an economic recovery might look like, valuing stocks is an increasingly challenging task, and some aren’t convinced that these high-fliers’ earnings can snap back so fast.
“We think it’s going to be a two-year shock to earnings, and that’s the big adjustment…that still needs to come through,” Ian Harnett, cofounder and chief investment strategist at Absolute Strategy Research, recently told CNBC’s Squawk Box Europe. “The economic adjustment has not yet been made by these markets.”
More must-read finance coverage from Fortune:
—Saving lives vs. saving the economy is a false tradeoff, economists say
—Real unemployment rate soars past 24.9%—and the U.S. has now lost 33.5 million jobs
—17% of unemployed workers aren’t looking for work—and that’s warping the official unemployment rate
—Does Apple’s stock buyback strategy make sense in this market?
—Goldman Sachs doubts there will be a Round 3 of PPP loans for small businesses
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
—WATCH: Why the banks were ready for the financial impact of coronavirus
Subscribe to How To Reopen, Fortune’s weekly newsletter on what it takes to reboot business in the midst of a pandemic


fortune--2020-05-27--How Wuhan tested 6.5 million people for coronavirus in 10 days

Wuhan, China, on May 15 launched an ambitious citywide campaign to test every one of its 11 million residents for the coronavirus.
The mass testing in the epicenter of the coronavirus outbreak was prompted by a rise in asymptomatic cases of COVID-19—people who are infected but show no symptoms of the disease—that raised fears of a second wave of cases.
Children under 6 and people who had already been recently tested were exempted from the initiative. Taking those exemptions into account, Wuhan is nearing its goal, having tested more than 6.5 million people in 10 days. Here’s how it pulled off the feat:
Shelling out
The Wuhan government coughed up an estimated $140 million for the campaign, with the government covering individual test costs. It also paid to employ thousands of medical workers to conduct testing. Workers made house calls for elderly and disabled people, roamed streets and construction sites to find migrant workers, and set up testing tents in residential compounds.
Wuhan health workers have swabbed samples from more than 9 million people, which makes up more than 90% of the city’s target for sampling, according to Chinese state media. Over 6.5 million of those samples have been tested, and the rest are still being processed.
Upping capacity
When the Wuhan government announced the mass testing plan on May 11, it called the effort a “10-day battle.”
Testing capacity ramped up massively after the official launch of the campaign on May 15, when 113,609 coronavirus tests were carried out. One week later, on May 22, more than 10% of the city’s population—1.47 million people—were tested in a single day.
For comparison, on that same day, May 22, New York State tested around 45,000 people. As of Tuesday, the state had conducted a total of 1.7 million tests. In the U.S. as a whole, 15 million people have been tested for the coronavirus.
The “10-day battle” officially ended on May 24, when the Wuhan government announced that more than 9 million samples had been collected.
The city says it is now in a “checking for gaps and patching up leaks” phase, to search for and test residents who missed out on the initial push. Wuhan residents who had never undergone a coronavirus test were instructed to register and arrange testing by May 26.
Authorities increased testing capacity so dramatically by using a batch testing method that allows for faster processing of samples but may compromise the accuracy of the results.
The method combines swab samples from up to 20 people to test as a single sample; if the sample tests positive, then the individuals will be retested one by one. This saves time—if the sample tests negative, then all 20 people can be checked off as negative for the virus—but it could lead to logistical problems like overly diluted samples, Chinese financial newsmagazine Caixin reported.
The batch testing method works best in areas with low infection rates, where there isn’t a high chance that every batch would need to be retested.
The method could help the U.S. increase its testing capacity and aid with reopening. A lab in Nebraska is currently carrying out batch testing, and researchers there reported that they are saving 50% to 60% worth of material and time compared to individual sample testing.
Cautious measures
Wuhan carried out testing systematically. Testing priority went to densely populated buildings and residential compounds with previous community outbreaks.
Test drive sites were set up in the open air to minimize infection risk, and people had assigned time slots, wore masks, had their temperatures checked, and were told to maintain distance while they queued.
Citizens receive their test results via a notification on their mobile phones, and their health codes—app-based QR codes that give each person a coronavirus risk rating and determine what public services they can use—are updated accordingly.
The millions of tests have so far turned up a total of 206 asymptomatic cases. Those people will be isolated and observed under medical quarantine to see if they develop symptoms. If they do, they’ll be hospitalized; if they don’t, they’ll be monitored until they test negative for the virus.
More must-read international coverage from Fortune:
—Inside China’s reopening: 7 personal stories of life after lockdown
—Photo essay: What life looks like in Europe as the continent starts to reopen
—Reopening of Shanghai Disneyland is a proving ground for pandemic-era theme parks
—Trump’s demand that China pay coronavirus reparations evokes an ugly history
—PODCAST: How Marc Benioff is helping out during the coronavirus pandemic
—WATCH: The global crisis in recycling
Subscribe to How To Reopen, Fortune’s weekly newsletter on what it takes to reboot business in the midst of a pandemic


fortune--2020-05-27--Here come the locusts—India prepares to do battle with crop-munching pests

Indian authorities are helping farmers mount a pesticide spraying campaign to fight the swarms of desert locusts which have already devastated crops across Pakistan and East Africa.
As many as 700 tractors, 75 fire engines and almost 50 other vehicles are engaged in spraying pesticides to kill the locusts, Trilochan Mohapatra, director general of the state-run Indian Council of Agricultural Research in New Delhi said on Tuesday. Drones will also be employed.
“At this point it’s manageable, but if it continues it will be a problem” for monsoon-sown crops, said Mohapatra, who’s also the top bureaucrat at the department of agricultural research and education. The impact will be lessened by the current spraying campaign and the fact that the harvest of the winter crop is mostly over, he said.
About 42,000 hectares (104,000 acres) of cotton, summer pulses and vegetable crops have been affected by locusts across six states, mainly in Rajasthan, said Mohapatra. Farmers grow rice, pulses, cotton, sugar cane and soybeans on over 106 million hectares in the monsoon season, according to the farm ministry.
Pink Swarms
Swarms of desert locusts occur irregularly in North Africa, the Middle East and South Asia, usually when drought is followed by heavy rain. Normally, with the arrival of the monsoon, locust swarms enter the desert areas of India via Pakistan for breeding in June-July, but this year pink adult swarms were reported as early as April 30 in Rajasthan and Punjab, the farm ministry said.
A man hold locust during the swarms of locust attack in the residential areas of Jaipur, Rajasthan. Wire photography: Vishal Bhatnagar—NurPhoto via Getty Images. Vishal Bhatnagar—NurPhoto/Getty Images
This is in part because of the uncontrolled swarms in Pakistan that breed continuously, the ministry said earlier. Swarms of pink immature adults fly high and travel long distances with strong winds coming from Pakistan. Most of them settle on trees during the night and mostly fly during the day, it said.
The hoppers and pink swarms have been controlled in 14,299 hectares in some areas of Rajasthan and Punjab as of May 11, according to the farm ministry.
In January, the biggest locust swarm to hit India’s Gujarat in over a quarter of a century resulted in more than 25,000 hectares of wheat, rapeseed, cumin and potatoes being attacked, with at least a third of the crops damaged in 75% of the affected areas, according to the state’s directorate of agriculture.
Overall, growth in India’s agriculture sector will likely be positive in the fiscal year that began on April 1, said Ashok Gulati, a professor at the Indian Council for Research on International Economic Relations in New Delhi. “It will have some impact on horticulture crops, but not much,” he said.
India’s massive locust attack 2019-20 saw about 403,488 hectares treated with pesticides, according to the farm ministry.


fortune--2020-05-27--The plastics problem is getting harder to solve

This is the web version of CEO Daily. To get it delivered to your inbox, sign up here.
Good morning.
“Plastic is my passion.” So says Surendra Patawari, Zooming with me yesterday from Belgium, where his giant global recycling company is based. I spoke with him about the state of plastics recycling, and it was not an encouraging conversation.
I’ve noted in this column before that an increasing number of big companies are targeting plastic recycling as an important goal. The Alliance to End Plastic waste includes companies like Dow, Pepsi, P&G and ExxonMobil, who have committed $1.5 billion to solving the plastics problem, and I believe they are sincere in their ambitions. Patawari, who sits on the board of the Alliance, believes they are sincere as well.
But here’s the thing: plastics recycling has pretty much collapsed. That was happening even before the pandemic, after China made its decision to stop importing plastic refuse for recycling. And it has gotten worse, in part because collapsed oil prices have made virgin plastic less expensive, and in part because other countries are regulating waste shipments, causing trade in plastic for recycling to shrivel. While companies like Pepsi and Unilever have set goals of using 25% recycled plastic packaging by 2025, Patawari says in fact only 16-17% of plastic is recycled now, and the percentage will decline next year. His industry “won’t be able to produce the quality and quantity of recycled plastic” those big companies need to meet their goals.
Meantime, in part because of the pandemic, the use of plastics is soaring–with discarded face masks and gloves adding to the refuse. “We cannot live without plastics. COVID 19 has proven that,” Patawari says. But unless the current broken system is fixed, waste will continue to accumulate, and clog the oceans. And while many big companies have gotten religion on the topic, this is an issue that ultimately will require government action to find its solution.
Speaking of broken–the airline industry in the U.S. is certainly in a world of hurt, with passenger volumes down 90% and only faint signs of recovery. But Fortune’s Shawn Tully crunches the numbers and concludes there is a way for the Big Four to survive.
And for those of you thinking of changing careers, here’s one with big growth prospects: bankruptcy attorney.
News below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
Boeing cuts
Boeing will reportedly announce 2,500 voluntary layoffs this week, representing the first phase of broader cuts that will involve roughly 16,000 job losses in total. Boeing hasn't made major layoffs for a few years, but union officials expect the initial wave of the new cuts to focus on the firm's Seattle-area commercial planes operation. Wall Street Journal
Hong Kong
As pro-democracy protests reignite in Hong Kong, tycoon Li Ka-shing says the spark—a new national security law drafted by Beijing—is fine. According to Hong Kong's richest man, the proposed new law "can allay concerns the central government has in Hong Kong and give rise to a positive outlook from here." Human rights activists and many international observers say the law would curtail civil liberties in Hong Kong. In protests today, around 250 people were arrested. Fortune
Eurozone contraction
European Central Bank President Christine Lagarde reckons output in the Eurozone will shrink by between 8% and 12%—in line with the ECB's more pessimistic forecasts. Lagarde said the less pessimistic forecasts were now "out of date." The Eurozone's central bank will publish its official numbers next week. Bloomberg
European stimulus
To combat the pandemic's economic effects, the European Commission will today announce a much-awaited stimulus plan that will build on the €500 billion ($550 billion) proposal made by Germany and France. Those two countries favor grants over conditional loans, while the "frugal four"—Austria, the Netherlands, Sweden and Denmark—take the opposite approach. Which side will Commission President Ursula von der Leyen take? CNBC
AROUND THE WATER COOLER
Facebook divisiveness
Facebook conducted an internal review of how its platforms drive people apart…then shelved the research and blocked attempts to apply its conclusions to Facebook's products. According to the Journal, Facebook policy chief Joel Kaplan decided the proposed changes, designed to stop polarization and make the social network more civil, were "paternalistic" and would have disproportionately affected conservative users and publishers. WSJ
Business models
Politico's Christian Oliver examines the question of whether Europe should be building champions such as South Korea's Samsung or Hyundai—and finds Koreans are sick of their chaebol conglomerates and would prefer to emulate Germany's Mittelstand SME model. He writes: "The chaebols rebuilt a country, but they can’t conjure up another miracle to take it to the next level in the showdown with China. Korea now realizes that it needs to change tack to unleash the country’s bottled-up talent and pump more oxygen into SMEs in areas like gaming, fashion, music, biotech and medical services." Politico
French cars
The French government has announced an €8 billion rescue package for its auto industry, and it's pretty green. Citizens will get grants of up to €7,000 to buy electric cars (or of up to €3,000 to buy a less-polluting car that's currently languishing in a showroom) and the industry will get investments to stimulate their electric-car production. President Emmanuel Macron: "We need a motivational goal - make France Europe's top producer of clean vehicles by bringing output to more than one million electric and hybrid cars per year over the next five years." BBC
Greek tourism
How can Greece restart its critical tourist industry without abandoning the success it has had in containing the spread of COVID-19? The Brookings Institution's William J. Antholis and Filippos Letsas argue that compulsory masks would help, as would social distancing measures. They add: "Greece may want to experiment with electronic bracelets and cell phone–tracing applications. Such initiatives may be expensive and complicated, but they are achievable if established early on at points of entry." Fortune
This edition of CEO Daily was edited by David Meyer.


fortune--2020-05-27--Why the SpaceX manned mission is critical to the private space race

If all goes according to plan on Wednesday, a SpaceX Falcon 9 rocket will lift off from Cape Canaveral, Fla. and carry two astronauts to the International Space Station (ISS).
A successful mission will mark not just the first time that humans have ever been carried into orbit by a private company, but it will also kick off the next major phase of the privatization of space. Planned missions to follow include the launch of private astronauts, a private space station, and possibly private missions beyond Earth. Meanwhile, the government is in line to save big money that can be reinvested in further space research and exploration.
“We have begun an exciting new chapter where NASA can now focus on deep space,” says Stanford professor Scott Hubbard, the former director of NASA’s Ames Research Center who also helped advise SpaceX on crew safety. “The more routine up and down to low Earth orbit can be purchased a bit like an airline ticket.”
“This is a big milestone,” adds Brett Loubert, a principal at Deloitte Consulting who focuses on the defense and aerospace industries. The U.S. is building the infrastructure to “foster the growth of a low Earth orbit space ecosystem and ability of private companies and citizens to go to space.”
It has been almost 10 years since the previous launch of humans into orbit from American soil. Since the last space shuttle mission on July 8, 2011, NASA has depended on Russian Soyuz rockets to ferry astronauts to and from the ISS.
The agency started working with SpaceX and Boeing to develop private launch capabilities in 2014. Boeing is slightly behind its rival, with its first mission expected next year if it can work out glitches with its Starliner capsule.
A major motivator for NASA to hire the two companies is cost.
Each space shuttle flight cost over $1 billion, as calculated in 2010, though the shuttle had the ability to carry up to six astronauts plus a payload in its cargo bay. NASA paid Russia over $80 million per person for Soyuz launches. By contrast, the total cost of launching an astronaut using SpaceX is just $55 million, according to a report last year from NASA’s Office of Inspector General.
Up next, the private space industry is preparing to deploy the first-ever private astronauts to the space station beginning in 2021. Texas-based startup Axiom Space, run by former NASA manager Mike Suffredini, has a deal with SpaceX to send four astronauts on commercial missions, and another startup, Space Adventures, contracted with SpaceX to carry tourists into space starting in 2022. Both deals hinge on the success of SpaceX’s Crew Dragon capsule in Wednesday’s launch.
Putting humans in orbit who aren’t government workers could help spur low-gravity manufacturing techniques for developing new materials, asteroid mining, and other commercial activities. It could also allow for working on satellites that need repairs after launch or that need some additional assembly before being put to use.
“A lot of the complexity and cost of a commercial satellite is in mechanisms that let it unfold itself after the launch vehicle experience,” says Jeff Greason, chief technologist at space startup Electric Sky and a member of the 2009 Augustine Commission that recommended private space crews. “And there’s no reason why much of that can’t be done by people if their cost is competitive.”
To further spur the space economy, NASA is also backing plans to privatize parts of the space station and help with fully private orbiting facilities. Axiom struck a deal with NASA in January to add a private module to the ISS for exploring commercial applications in low gravity. That company plus another startup, Nevada-based Bigelow Aerospace, are even moving forward with plans for fully private stations, as NASA may not have the desire, or the funding, to replace the ISS when it reaches the end of its useful life in another five or 10 years.
Still, one successful mission and plans for more don’t guarantee that the private sector space effort will thrive, warns Harvard Business School professor Matt Weinzierl, who has studied the private space race. The government and the private sector must continue to invest in larger and more ambitious missions, like a return to the moon, to expand capabilities and build on the success, he says.
If that happens, “we will look back on this launch as a clear signal of the beginning of a new great adventure in space that taps into the power of the private sector,” Weinzierl says. “If we fail to do so, we will look back on it as the end of a bold and promising experiment.”


fortune--2020-05-27--Could Hong Kong tensions sink the global stocks rally?

This is the web version of the Bull Sheet, Fortune’s no-BS daily newsletter on the markets. Sign up to receive it in your inbox here.
Good morning. The Hong Kong-Beijing tensions continue to weigh on investors, as both the U.S. and EU consider their own responses to the crisis. Those concerns though are no match for the stimulus-fueled hopes for a quick(ish) rebound of the global economy.
Let’s check in on the action.
Markets update
Asia
The Asian indices are mixed this morning with Hong Kong’s Hang Seng losing ground after yesterday’s impressive rally.
this morning with Hong Kong’s losing ground after yesterday’s impressive rally. Protesters hit the streets in Hong Kong again today to voice their opposition to Beijing’s proposed heightened security push .
to voice their opposition to Beijing’s proposed . There are real concerns Washington could jump in and sanction the Chinese government over the new Hong Kong-focused security bill, opening up a new rift between the trading powers. The EU too appears set to side with Hong Kong .
could jump in and over the new Hong Kong-focused security bill, opening up a new rift between the trading powers. The too appears set to . If you ask Hong Kong’s richest man, Li Ka-shing … he’s urging caution, and tacit support for the draft law.
… he’s urging caution, and tacit support for the draft law. Japan is dead set on spending its way out of this economic crisis. The country has proposed a new $1.1 trillion stimulus package (bringing the bailout tab to nearly $2.2 trillion), sending the Nikkei higher.
Europe
European bourses climbed at the open, with London, Frankfurt and Paris all trading higher, by more than 1% , two hours into the trading day.
bourses climbed at the open, with and all trading higher, by more than , two hours into the trading day. The markets are gaining on hopes the European Commission later today will unveil a mega stimulus package that exceeds €500 billion .
are gaining on hopes the later today will unveil a mega stimulus package that exceeds . Emmanuel Macron is proposing an €8 billion bailout package specifically for French automakers— €5 billion of which will go to Renault. And there’s a twist: it will include subsidies to buy electric and hybrid-e cars as the country seeks to become a leader in making green vehicles.
U.S.
The Dow , S&P 500 and Nasdaq futures point to another positive open, looking to extend yesterday’s gains.
, and futures point to another positive open, looking to extend yesterday’s gains. The Nasdaq closed yesterday 0.17% higher. The tech-laden index got within 2% of its all-time high Tuesday morning before retreating. That’s one to watch in the coming days.
higher. The tech-laden index got within Tuesday morning before retreating. That’s one to watch in the coming days. St. Louis Fed President James Bullard can hardly be considered a bull. Yet on Tuesday, Bullard said he expects a rapid second-half rebound that will bring the unemployment rate back to below 10% by year-end. He predicts Q3 will be “the best quarter of all time on the growth perspective.”
Elsewhere
Gold is down.
is down. The dollar is up.
is up. Crude is down again, but off its lows, with Brent trading a hair above $36 per barrel.
High fliers
Yesterday’s stock surge was unusual in that it starred one of the most downtrodden of sectors: travel. Airline stocks took off, with most racking up double-digit gains.
Here’s a look at yesterday’s high-flying performance:
United Airlines, up 16%… American Airlines up 14.8%…Delta Air Lines, up 13%… Southwest Airlines, up 12.6%. According to MarketWatch, a UBS aviation analyst upgraded Southwest because it sees “a clearer path for domestic travel recovery.” That was enough to lift much of the sector.
The data though is telling a different story—that the recovery in air travel could be a drawn-out affair. That’s not surprising. A lot of countries are still banning flights from coronavirus-stricken hotspots, or are enforcing why-bother-even-going quarantine measures. And businesses everywhere are slashing travel budgets.
These headwinds are showing up in the most recent travel data. LPL Financial last week pored through a series of real-time data sources looking for evidence of a “reopening rebound.” They found it with motorists. Driving is picking up. They found it with diners. Reservations are ticking up, too. They did not, however, find it with air travel, as their chart here shows:
Check-ins at the airport are still down roughly 90%, little improved from a month ago, they say, citing TSA data.
“Driving appears to be the transportation mode of choice in a pandemic,” LPL writes in the research note. “Airlines will take quite a while to come back.”
It will be interesting to see if the data from the Memorial Day weekend shows any kind of up-tick whatsoever. It will be a much-watched indicator— not just for the sector, but for the economy as a whole.
***
Have a nice day. I’ll see you here tomorrow.
Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com
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Today's reads
Doom-and-gloom hiring boom. The hottest job of 2020 is turning out to be: bankruptcy lawyers. As my colleague David Z. Morris reports, "openings for bankruptcy attorneys have tripled since January on online job board ZipRecruiter, while postings across all industries have fallen 48%." We've already had a string of high-profile bankruptcies—J. Crew, J.C. Penney and Hertz come to mind—and a lot more are expected.
Who would even consider an IPO these days? Warner Music Group, that's who. Warner, once considered a member of the Big Five major music labels, is seeking to raise as much as $1.8 billion—according to a regulatory filing yesterday. That would value the label at $13.3 billion.
(Some of these stories require a subscription to access. There is a discount offer for our loyal readers if you use this link to sign up. Thank you for supporting our journalism.)
Market candy
The front nine
Spain won't reopen to tourists until July 1, but that's not stopping the Mediterranean village of Sotogrande—with its Ryder Cup-level courses—from offering a special travel package for those who want to fly in on a private jet and shoot 18 holes over a three-day period at some of its most famous courses. The price, according to Bloomberg, is about €5,000 per person (coronavirus testing is thrown in.)


fortune--2020-05-27--Uber’s new headquarters proposal for Hong Kong comes with a big caveat

Uber has proposed relocating its Asia-Pacific headquarters to Hong Kong days after a controversial move from Beijing to impose “national security” laws in the Special Administrative Region jeopardized the future of the city’s business environment.
“Today’s announcement is not only about the future of Uber in Hong Kong, but the future of the city as a global economic powerhouse and technology capital where innovative businesses can thrive and grow,” Uber Hong Kong general manager Estyn Chung said in a statement Tuesday, confirming earlier reports the city was being eyed as the regional HQ’s next destination.
Although Uber says the company is “ready to move,” it also warns that the relocation comes with a major caveat: The Hong Kong government has to approve ride sharing first.
City break
Uber’s APAC headquarters is currently in Singapore. The California company opened its Singapore office, where it reportedly employs around 150 people, in 2019. Last week, CEO Dara Khosrowshahi told employees that the company would close its Singapore office over the next 12 months and move to “a market where we operate our services.”
Uber ceded operation of its Southeast Asia business to Grab in 2018, taking a 28% stake in the six-year-old startup as compensation. (Grab is the predominant ride-hailing service in Singapore.) Uber struck a similar deal with China’s Didi in 2016, after burning billions of dollars trying to gain market share in the mainland.
With much of Asia already given over to rivals, Uber’s APAC division covers nine remaining regions: Australia, New Zealand, India, Bangladesh, Sri Lanka, Japan, South Korea, Taiwan, and Hong Kong.
Uber claims moving its regional headquarters to Hong Kong would help create jobs in engineering and data management, opening opportunities for forthcoming graduates. In Hong Kong, however, Uber has spent six years operating in a legal gray area. Local law prohibits transporting passengers without a license, and illegal taxi operators face fines up to $1,200.
Uber attempted to bypass the regulations in March 2018 by launching a service called Uber Flash in partnership with a local taxi company. The owner of the taxi company pulled out shortly before the venture took effect, however, after reportedly receiving threats to his family from other taxi operators.
No fare
Hong Kong’s taxi driver union continues to frustrate Uber’s ambitions for Hong Kong. After Uber proposed relocating to the city, Chan Man-keung, chairman of the Association of Taxi Industry Development, told the South China Morning Post that the association would “definitely oppose any deal with Uber” if taxi drivers aren’t compensated for “losses.”
“The government needs to be fair to taxi owners. They all invested a substantial sum of money to get their license. The government could buy back all our licenses, and then it can reform the market as it pleases,” Chan said.
There are 18,163 taxis in Hong Kong. That number has remained largely stable since 1994, when the government decided to issue new licenses “only when necessary.” The cap has kept taxi licenses at a premium. Currently, each medallion costs roughly $645,000. (A medallion for a yellow cab in New York City costs around $150,000.)
Licenses are typically owned by companies that manage small fleets, charging individual drivers fees to operate a taxi. Having spent millions of dollars on medallions, these operators oppose any change that could hinder the return on their investment—such as introducing modern competition.
Despite the challenges, Uber has managed to maintain a presence in Hong Kong. According to the company, close to 250,000 Hong Kongers have registered as drivers with Uber, while the firm’s food delivery service Uber Eats has partnered with over 6,400 restaurants. Drivers that operate in Hong Kong do so illegally and risk getting hit with fines.
Hong Kong has also proved to be a bright spot amid the coronavirus, which has devastated Uber’s global business. Uber says trip numbers in Hong Kong have returned to 70% of their pre-pandemic level already.
“Uber wants to be a pillar of Hong Kong’s economic recovery and send a signal to other global leaders that Hong Kong is ready to lead the next wave of tech innovation,” the company said. “We ask the government to work with us to help make this vision a reality.”


fortune--2020-05-27--How the pandemic boosted the net worth of China’s fastest-rising billionaire

One of China’s youngest billionaires is becoming one of the country’s wealthiest, thanks in part to the coronavirus pandemic.
Colin Huang, 40, the founder of China’s e-commerce company Pinduoduo, or PDD, saw his net worth grow the fastest of any billionaire in China in the past two months. He has accumulated $18 billion, bringing his total net worth to $35.6 billion as of last week. That sum makes him the third-wealthiest person in China, according to analysis by Forbes. He’s edged out by Jack Ma, founder of the e-commerce firm Alibaba and China’s second-richest person, who saw his net worth grow by $3 billion to over $41 billion in the same period. China’s richest person, Pony Ma, founder of the tech and social media giant Tencent, was worth $46 billion, an increase of $7 billion.
Huang’s rapid rise to the top ranks of China’s billionaire class has come, in large part, on the back of PDD’s skyrocketing shares as Chinese consumers have increasingly turned to online platforms amid the pandemic. Huang owns a 45% stake in Pinduoduo, and the company’s Nasdaq-listed shares have nearly doubled in value since the beginning of the year, boosting the e-commerce company’s market cap from $44 billion on Dec. 31, 2019, to roughly $80 billion today.
What is Pinduoduo?
Founded in 2015, PDD is a relative upstart in China’s e-commerce space that has been dominated by the likes of Alibaba, a Chinese e-commerce pioneer with its Tmall marketplace, and JD.com, an e-commerce company headquartered in Beijing.
PDD has made inroads in the sector by focusing on less sought-after consumers in China’s third- and fourth-tier cities and by offering unique shopping experiences.
Colin Huang, founder and CEO of Pinduoduo, attends the company’s listing ceremony at Shanghai Tower, July 26, 2018. Visual China Group/Getty Images
One of the most popular features of the PDD app is a group buying function, in which consumers can order larger shipments of discounted goods from factories. After an individual customer makes a purchase, he or she is given a window of time to encourage friends, family, or other users to buy the same item, resulting in a bulk purchase.
This social function relies on PDD’s integration with Tencent-owned WeChat, the nearly ubiquitous social messaging app in China. Tencent reportedly owns a 17% stake in PDD.
PDD is also famous for its “gamified” shopping. For example, if a user waters a virtual mango tree via the app for enough days in a row, PDD will send the user a free box of mangoes. With these games, PDD encourages daily visits to its app and increases user engagement. The idea to closely tie shopping with gaming stems from Huang’s own experience in launching an online gaming startup before founding PDD.
A pandemic boon
PDD’s strategy proved a winning one when Chinese consumers were confined to their homes in the early months of 2020.
In the first quarter, the company reported 628 million total active buyers, up from 585 million in the fourth quarter of 2019. Alibaba, by comparison, reported 726 million total buyers in its recent first-quarter results. Pinduoduo also said that daily orders have increased to 65 million since the beginning of May, up from 50 million per day before the pandemic hit China in January.
Still, the company has largely failed to crack more profitable tier-one markets like Beijing and Shanghai, where it has a reputation for selling fake or lower-quality goods. The company seems intent on changing that narrative. It recently attracted 1 million viewers to a live stream that provided a virtual tour of a warehouse that sources many of PDD’s products, an apparent attempt to shore up confidence in the quality of goods sold on the platform.
In a letter to shareholders on April 25, Huang said of the pandemic: “Nobody can come out as a winner in the midst of catastrophe.”
At the same time, PDD’s success amid the pandemic has certainly boosted his fortunes.


fortune--2020-05-27--Quest Diagnostics is offering coronavirus testing services to large employers

Quest Diagnostics Inc. is offering services to large employers geared at getting their employees back to work safely, including testing for the novel coronavirus, analytics to monitor symptoms and hotspots, and services like temperature monitoring, the company announced Wednesday.
The Quest program joins similar ones from Laboratory Corp. of America Holdings and health providers like primary-care clinic One Medical, showing how reopening efforts have created a new way for health-care companies to market their services.
Testing could take on an even greater role in the back-to-work push in the U.S., thanks to significantly improved availability of both diagnostic testing and antibody tests that screen for prior infections. Even so, many employers have approached the subject cautiously. Obstacles abound, including the complex logistics of testing a workforce, the cost of a large-scale program, and the privacy concerns raised by employers taking on an unusually invasive role in their workers’ health.
For employers looking to bring in non-essential employees, the approach “varies quite a bit based on who they are, what they do and how urgent they believe it is for their workforce to return physically to work every day,” Quest Chief Executive Steve Rusckowski said in an interview. Location is also a factor, as well as rates of infection in the community and the density of a given environment.
Varying Approaches
All available testing for the new coronavirus has limitations, so approaches will vary. Some employers have opted for diagnostic tests for all employees, with required weekly testing, while others are more inclined to test some of their workforce on a periodic basis, alongside imposing hygienic standards and other precautions like surveillance, Rusckowski said.
For companies with workers in hotspots like New Jersey, for instance, antibody testing, which screen for markers in the blood tied to a past infection and may also indicate some level of immunity, can be a “very valuable tool” to examine the virus’s prevalence in their workforce, Chief Medical Officer Jay Wohlgemuth said in an interview. Antibody tests can be used to develop other parts of a workplace strategy, including how often diagnostic testing — which is considered more reliable — is needed, he said.
“Boy, that’s a tall order to do diagnostic testing with nasal swabs in the entire population. And then to do it on a repeated basis, that’s expensive and that’s burdensome,” Wohlgemuth said.
Moreover, “the reality is, once we test you, that moment of time will determine if you have the virus or not,” Rusckowski said. “After you leave, you can get infected. So you’re always at some exposure.”
Holiday Retirement
An early client of the new Quest program is Holiday Retirement, which manages independent living facilities for seniors in hundreds of communities across the U.S. The Winter Park, Florida-based company is using Quest to perform antibody tests on employees, and aims to offer diagnostic testing as well.
Quest has also had to navigate testing its workforce, offering voluntary antibody tests so its near-35,000 employees continue to work during the pandemic.
Scaling up testing, particularly diagnostic testing, will also hinge on its accessibility. Quest believes at-home sample collection is likely to be key. It requires the patient to take her own swab and mail it in, a capability that Quest is developing and expects the U.S. Food and Drug Administration to authorize in the near term, Wohlgemuth said.
“We’re not asking a symptomatic person to get up and drive in somewhere, which is just a bad idea. And we don’t need protective gear” with at-home sample collection, Wohlgemuth said. “This is what we think will make diagnostic testing available in a way that we can actually meet this return to work need.”
“And maybe this is how we should have been doing it all along, because this is health care that is centered on an individual and not on a doctor or health system,” he said.


fortune--2020-05-27--Hong Kong’s richest man defends Beijing’s national security law

Hong Kong’s richest tycoon Li Ka-shing defended a national security law drafted by Beijing, in his first comment on the proposal that has triggered fresh protests in the city.
“It is within each and every nation’s sovereign right to address its national security concerns,” the 91-year-old billionaire said in a text message sent by his representatives. “We probably need not over-interpret it. Hopefully the proposed new law can allay concerns the central government has in Hong Kong and give rise to a positive outlook from there.”
Li also called on the Hong Kong government to maintain international trust and strengthen its citizens’ faith in the “one country, two systems” principle.
China’s government last week announced it would write a new national security law into Hong Kong’s charter following months of pro-democracy demonstrations seen as challenging its authority. The city’s $363 billion economy is also battling a recession, with the second blow coming from the coronavirus pandemic that’s decimated industries from retail to tourism.
The proposed measure is expected to pass in the National People’s Congress, China’s parliament, before the end of its annual session May 28. The lack of details surrounding the new law has generated alarm among some businesses and lawyers, while Beijing has sought to reassure Hong Kong that its judiciary would remain independent.
A net worth of about $25 billion makes Li Hong Kong’s richest person, and the seventh wealthiest in Asia, according to the Bloomberg Billionaires Index.


fortune--2020-05-27--What Amazon would gain by buying self-driving car startup Zoox

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Amazon’s possible acquisition of self-driving car startup Zoox would help the online retailing giant expand its burgeoning logistics-and-delivery network.
The price tag for the once-high-flying Zoox, as reported by the Wall Street Journal on Tuesday, would be below the $3.2 billion valuation the company received in its most recent funding round in 2018.
Amazon and Zoox both declined to comment about any acquisition talks.
Karl Iagnemma, CEO of a self-driving car joint venture between automaker Hyundai and vehicle component company Aptiv, says the discussion between Amazon and Zoox “speaks to the sustained interest in self-driving technology by major global players, full stop.”
He declined to comment about the deal itself because he’s not involved. But he did say, “It’s not a surprise that very large technology conglomerates want to get in,” referring to tech giants like Amazon and Apple being interested in autonomous vehicles.
Several analysts contacted by Fortune weren’t surprised by Amazon’s move on Zoox considering that Amazon has already made big investments in somewhat related artificial intelligence projects. For instance, in 2019, Amazon joined others in investing $530 million in self-driving tech company Aurora.
Asad Hussain, the lead mobility tech analyst for research firm PitchBook Data, believes the current economic downturn caused by the coronavirus pandemic “has really catalyzed consolidation to a new level in this space.” Before the COVID-19 outbreak, self-driving car companies were already struggling because they had underestimated the cost of developing the necessary technology.
Those with deep pockets like Amazon are now well positioned to gobble up struggling companies.
“I think this deal really reflects a wave of consolidation in the autonomous-vehicle space that has been on the cards for a while now,” Hussain says. He suspects that other tech companies including Apple, Intel, and Nvidia may also be “coming in and scooping up acquisitions at pretty attractive discounts.”
In 2019, Apple bought the self-driving car startup Drive.ai amid reports that it was hurting financially. Meanwhile, in May, Intel bought the startup Moovit, which developed a public-transit app, for $900 million in a deal that some analysts speculated would help Intel develop better technology components for autonomous vehicles. Before the coronavirus pandemic and acquisition, Moovit was reportedly looking to raise money.
Sam Abuelsamid, an analyst with Guidehouse Insights, says Amazon’s potential purchase of Zoox could be used to improve or cut costs for deliveries and warehousing. He imagined a future in which Amazon operates driverless delivery vans that, after being parked, would serve as hubs for fleets of drones that deliver packages to individual homes.
As for Amazon building an autonomous ride-sharing service akin to what Uber or Lyft hope to create, Abuelsamid says he’s skeptical in the near term. But Amazon, which is known for long-term bets, could develop one in the future.
If so, that would put extra pressure on Lyft and Uber to reevaluate their self-driving car projects. Hussain says he’s long argued that Uber “should be divesting” itself from developing self-driving car technology. Instead, he believes Uber, which recently announced job cuts in its A.I. division, should partner with other companies on developing the technology, perhaps even creating autonomous-vehicle joint ventures that could carry the costs.
“When you look at where they are in terms of technical capabilities, they’re well behind the leaders in this space,” Hussain says about Uber. “I don’t think they have a good competitive position.”


fortune--2020-05-27--Trumpists declare war on Twitter

Trumpists declare war on Twitter

President Donald Trump and some of his followers attacked Twitter and one of its leaders after the company added a fact-check label to debunk one of Trump’s recent tweets about mail-in voting ballots.
The controversy stems from a tweet Trump posted on Tuesday in which he said, “There is NO WAY (ZERO!) that Mail-In Ballots will be anything less than substantially fraudulent.” Twitter flagged the post with a fact-check link that says “get the facts about mail-in ballots” and provides more information about the voting process.
On Wednesday, Trump struck back at Twitter, tweeting: “Republicans feel that Social Media Platforms totally silence conservatives voices. We will strongly regulate, or close them down, before we can ever allow this to happen.” A few hours later he tweeted again with a threat: “Twitter has now shown that everything we have been saying about them (and their other compatriots) is correct. Big action to follow!”
Republicans feel that Social Media Platforms totally silence conservatives voices. We will strongly regulate, or close them down, before we can ever allow this to happen. We saw what they attempted to do, and failed, in 2016. We can’t let a more sophisticated version of that…. — Donald J. Trump (@realDonaldTrump) May 27, 2020
Twitter has now shown that everything we have been saying about them (and their other compatriots) is correct. Big action to follow! — Donald J. Trump (@realDonaldTrump) May 27, 2020
Meanwhile, White House adviser Kellyanne Conway went on Fox & Friends on Wednesday morning and broadcast the handle for Twitter’s head of integrity, Yoel Roth. She criticized his personal tweets about politics and blamed him for Twitter’s actions against the President. Following her comments, Roth became the target of angry tweets from other users and even received “an explosion of death threats,” according to Protocol.
The latest spat between Twitter and Trump and his base comes at a challenging time for social media companies, some of which are trying to better moderate user posts. Twitter has tried to stay out of the cross fire, even going as far as banning all political ads. But conservatives, who have long felt social media companies unfairly police their comments, have only grown angrier.
Twitter declined to comment about the President’s latest tweets. But in a statement about Roth, it said, “No one person at Twitter is responsible for our policies or enforcement actions, and it’s unfortunate to see individual employees targeted for company decisions.”
In the past, Trump has often lobbed angry comments at businesses, including Amazon, but then rarely followed through with any action, said Jennifer Grygiel, a Syracuse University assistant professor who studies social media. And though he can’t immediately hurt Twitter, he could complicate matters for it.
“He can’t shut them down or have the government become the truth police inside Twitter,” said Nathaniel Persily, a Stanford University law professor who’s studied how the Internet impacts democracy. “So in the absence of that, what can he do is make life difficult for them by launching investigations [for political bias] that could be costly.”
In terms of the law, Twitter, along with Facebook and Google, has already won an appeal in a case that accused the companies of suppressing conservative views. On Wednesday, the U.S. Court of Appeals in Washington, D.C., dismissed a lawsuit filed by conservative nonprofit Freedom Watch and YouTube commentator Laura Loomer.
Twitter’s move to flag one of Trump’s tweets also may suggest that Twitter is trying to respond to critics who have long suggested that the President spreads misinformation on social media. “You have to ask, Why is Twitter doing this now?” Grygiel said. “The company fears the court of public opinion more than they fear the President’s rage tweeting.”
But by labeling Trump’s tweet rather than demoting it, Twitter may essentially be drawing more attention to the tweet rather than combating misinformation, Persily said. And now, after upsetting Trump’s base, Twitter will face pressure to add its new fact-check label to the posts of politicians across both parties—and even internationally.
“It’s just impossible, that’s the problem,” Persily said. “There’s so much information flying around…There’s no way Twitter can deal with that.”


fortune--2020-05-27--Leaked documents show what Goldman Sachs really thinks of Bitcoin

News that Goldman Sachs would be briefing clients about Bitcoin set the cryptocurrency world abuzz on Wednesday morning. Would the famous investment bank deliver a seal of approval to digital currency? Would the briefing cause the price of Bitcoin to soar?
Alas, for crypto fans, the answer came as a resounding no when slides of Goldman’s presentation, dryly titled “US Economic Outlook & Implications of Current Policies for Inflation, Gold and Bitcoin,” leaked on social media.
One slide offered the withering perspective that cryptocurrencies like Bitcoin are not even an asset class in the first place, and that they offer neither cash flow nor a hedge against inflation.
“We believe that a security whose appreciation is primarily dependent on whether someone else is willing to pay a higher price for it is not a suitable investment for our clients,” the slide concluded.
That wasn’t the worst of it. A follow-up slide suggested the other most notable feature of cryptocurrency is as a “conduit for illegal activity,” including Ponzi schemes and ransomware, while another invoked the Dutch tulip mania. Ouch.
Not surprisingly, Bitcoin’s many ardent fans on Twitter lashed out at Goldman Sachs. These included Tyler and Cameron Winklevoss, the twins who gained fame for their legal tussles with Mark Zuckerberg before becoming Bitcoin billionaires. They jabbed the bank over its alleged ignorance and hypocrisy about cryptocurrency:
Bitcoin does "not generate cash flow like bonds." Because it's not a bond. And the sky is blue. — Cameron Winklevoss (@winklevoss) May 27, 2020
Goldman Sachs: In 2019, $2.8 billion in Bitcoin was sent to currency exchanges from criminal entities.
Fun Fact: Goldman Sachs facilitated $6 billion in money laundering via 1MDB scandal between 2012-13.
Double standard much? — Tyler Winklevoss (@tylerwinklevoss) May 27, 2020
Meanwhile, Ryan Selkis, the CEO of crypto research firm Messari, revived Goldman’s “vampire squid” moniker to compare the bank’s performance to Bitcoin.
Fun fact, in just over a decade #bitcoin has 2.5x’d Goldman Sachs market cap.
BTC’s volatility is a defensive weapon that has allowed it to hide in plain sight before slaying the vampire squid for good. pic.twitter.com/cR6dWEs3fW — Ryan Selkis (@twobitidiot) May 27, 2020
And Neeraj Agrawal of the industry group Coin Center couldn’t resist reminding the bank of its 2018 flirtation with building a crypto trading desk—and the questionable hairstyles of its would-be Bitcoin executives.
Remember when Goldman Sachs had a double manbun bitcoin division https://t.co/vqLzh7OXdr pic.twitter.com/tAGL2CvCcZ — Neeraj K. Agrawal (@NeerajKA) May 27, 2020
A spokesperson for Goldman Sachs declined to comment on the Twitter contretemps, saying, “I’m not sure there’s much to add.”
In the bigger picture, Wednesday’s dustup is likely to become just another footnote in the long-running feud between Bitcoin boosters and the traditional financial establishment—a feud that has seen Warren Buffett tar Bitcoin as “rat poison squared” and JPMorgan CEO Jamie Dimon declare it a “fraud.”
Despite the social media melodrama, however, there are signs the two worlds are coming together. Earlier this month, the Wall Street Journal reported JPMorgan was taking on crypto giant Coinbase as a banking client while, on Wednesday, Coinbase announced it was acquiring a trading firm composed of traditional financial executives—including one from Goldman Sachs.
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—Real unemployment rate soars past 24.9%—and the U.S. has now lost 33.5 million jobs
—17% of unemployed workers aren’t looking for work—and that’s warping the official unemployment rate
—Does Apple’s stock buyback strategy make sense in this market?
—Goldman Sachs doubts there will be a Round 3 of PPP loans for small businesses
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
—WATCH: Why the banks were ready for the financial impact of coronavirus
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fortune--2020-05-27--The U.S. crosses 100,000 COVID-19 deaths as states reopen more businesses

The U.S. crossed 100,000 COVID-19 deaths just 127 days since the Centers for Disease Control and Prevention confirmed the first case of the coronavirus on January 21 from a traveler returning from Wuhan and 88 days since the first U.S. COVID-19 death was made public on February 29 in Washington.
The number of COVID-19 deaths in the U.S. climbed to 100,047 on Wednesday, according to data collected by Johns Hopkins University. The United States represents 28.3% of reported global COVID-19 deaths.
Just as the country reaches this milestone, most states are starting to ease lockdowns—measures states put in place in March to slow down the spread of the deadly virus. Last week, Ohio reopened dine-in restaurants and opened gyms this week. Connecticut, New York, and New Jersey— all hard hit by the virus—have opened some beaches with restrictions.
New York leads the nation with 29,370 COVID-19 deaths, followed by New Jersey with 11,339 deaths, and Massachusetts at 6,473 deaths. So far, the pandemic has taken the most life in the Northeast. Meanwhile, the second and third largest states by population, Texas and Florida, don’t rank in the top 10 for COVID-19 deaths.
But these numbers might be well under the actual death total. Deaths may have been attributed to other causes, especially in the early days when testing was lagging. U.S. death totals in April were 20% to 37% above the CDC’s threshold for ‘excess deaths’. This suggest the official COVID-19 death totals alone can’t account for the total increase in ‘excess deaths.’