Economy

Business • Economy
Angela Merkel criticizes Trump's social media ban
Angela Merkel
Angela Merkel Credit: Bundesregierung/Denzel (Public Domain)

German government criticizes the permanent blocking of Trump's social media accounts. Merkel pointed out that freedom of expression as a fundamental right should only be restricted by legislation and not by companies.

In principle, the German government condemns statements inciting hatred and violence and is in favor of regulating social networks.

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Euro overtakes dollar as most widely used currency
Euro overtakes dollar as most widely used currency
Credit: unsplash.com / Omid Armin

For the first time in years, the EU's common currency has overtaken the dollar as an international currency. The British pound is by far the third most frequently used means of payment.

Following an evaluation of the Society for Worldwide Interbank Telecommunications (SWIFT) the demand for the euro as an international means of payment has increased significantly during the pandemic.

According to SWIFT, about 37.8 percent of all money transfers worldwide in October were in euros. This was six percentage points more than at the turn of the year. During the same period, the dollar's share fell by 4.6 percentage points to 37.5 percent.

Business • Economy
easyJet reports £835 million loss in 2020, worst results in its 25-year history
easyJet reports £835 million loss in 2020, worst results in its 25-year history
Credit: unsplash/Jan Rosolino

British multinational budget airline easyJet has reported a £835 million loss in the year to 30 September 2020, compared to £427 million in profits in 2019. Due to the Covid-19 pandemic, both easyJet's revenue and passenger numbers declined by approx. 50%,

"I am immensely proud of the performance of the easyJet team in facing the challenges of 2020. We responded robustly and decisively, minimising losses, reducing cash burn and launching the largest cost out and restructuring programme in our history – all while raising more than £3.1 billion in liquidity to date," so chief executive, Johan Lundgren

Business • Economy
Spanish bank Santander buys Wirecard's core business after bankruptcy
Spanish bank Santander buys Wirecard's core business after bankruptcy
Credit: Kaethe17 / via Wikimedia Commons (Creative Commons Attribution ShareAlike 4.0)

Wirecard's insolvency administrator Michael Jaffé has stated in a press release that they have "been able to successfully conclude the investor process for Wirecard's core business despite the most unfavorable conditions" by selling Wirecard's core business to the major Spanish bank Santander, They have acquired the European core business of the payment service provider Wirecard specifically the technology platform in Europe and all the assets necessary for it.

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New World's largest trades bloc created

15 countries have formed the world's largest trading bloc.

It is named 'RCEP', short for 'Regional Comprehensive Economic Partnership'. The countries involved include 10 Southeastern Asian companies, South Korea, China, Japan, Australia and New Zealand.

The long road to this point started back in 2012. The US was excluded from the deal after pulling out of a rival Asia-Pacific deal in 2017.

The deal was confirmed by each individual country signing copies of the trade agreement, and then showing it to a camera in a virtual ceremony.

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Deutsche Bank suggests a 5% tax on remote workers to help the world rebuild from Covid-19
Deutsche Bank suggests a 5% tax on remote workers to help the world rebuild from Covid-19
Credit: Chris Montgomery

In a report called “What we must do to rebuild”, Deutsche Bank suggests slapping a 5% daily tax on people who work from home and using the funds raised to subsidise the lowest-paid workers who are unable to work remotely.

Working from home meant that many people were saving on everyday costs such as travel, lunch, clothes and cleaning, as well as probably spending less on socializing. Subsidizing businesses that had no long-term future in this shift toward "human disconnection" made no sense for governments, Templeman said, but supporting workers who had been "displaced by forces out outside their control". At the same time, they retrain or figure out their next steps did.

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Bitcoin rises to three-year high
Bitcoin rises to three-year high
Credit: unsplash.com / André François McKenzie

Bitcoin rose on Wednesday by up to four percent to 14,274.53 dollars and was thus as expensive as last time during the hype at the turn of the year 2017/2018. In June, the Bitcoin supply has also been reduced by the so-called "halving" - for the third time in the history of the digital currency.

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PayPal announces launch of cryptocurrency service
PayPal announces launch of cryptocurrency service
Credit: unsplash.com / Dmitry Demidko

PayPal has announced that cryptocurrencies such as bitcoin will in the future be supported by their services and will enable users to buy, hold and sell digital currencies through their platform.

PayPal President and CEO Dan Schulman has stated that "our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange".

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U.S. sues Google for alleged abuse of market position
U.S. sues Google for alleged abuse of market position
Credit: unsplash.com / Paweł Czerwiński

The U.S. Justice Department on Tuesday filed an antitrust suit against Alphabet Inc, Google's parent company, in which it accuses of violating the law by abusing its dominant market position over its competitors. This is the most important legal offensive against a technological giant in at least two decades, and represents the culmination of a year-long investigation that concludes that the company took advantage of its dominant position in the search and advertising market to the detriment of competitors and consumers.

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IBM will split into two public companies
IBM will split into two public companies
Credit: unsplash.com / Mikita Yo

In order to focus on new high-margin businesses, such as cloud services and AI, IBM will split into two public companies. The company's legacy IT infrastructure work will be handled by a new spin-off company.

The split is expected to be completed by the end of 2021 and following IBM's projections the new spin-off company will be the world's "leading managed infrastructure service provider" with around 90,000 employees, while the remaining of the 352,000 current employees will stay with the main company.

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World Bank: further 150 million people face extreme poverty by 2020
World Bank Headquarters, 2013
World Bank Headquarters, 2013 Credit: World Bank (Creative Commons Attribution 2.0)

The Coronavirus pandemic could push as many as 150 million people into poverty by 2022, living on less than $1.90 a day, the World Bank said Wednesday. The number is depending on the severity of the economic impact of Coronavirus. Regions most affected will be countries in South Asia and sub-Saharan Africa. Poverty will also affect more educated and urban residents.

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European Central Bank preparing for possible digital euro launch in 2021
European Central Bank preparing for possible digital euro launch in 2021
Credit: DXR / Wikimedia Commons (Creative Commons Attribution ShareAlike 4.0)

The European Central Bank is currently preparing a concept for an official digital currency that would complement hard cash as a payment method. "Towards the middle of 2021 we will decide whether to launch a digital euro project." states the official website of the project.

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Airbnb seeks to raise roughly $3 billion in IPO
Airbnb Office
Airbnb Office Credit: Open Grid Scheduler / Grid Engine (Public Domain)

Reuters report that home rental company Airbnb is aiming to raise around $3 billion in its upcoming initial public offering. Back in August, the company announced it had filed confidentially for the IPO.

The company aims to achieve a valuation of more than $30 billion in the IPO, a value substantially higher than the $18 billion Airbnb was valued at in April.

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Disney to lay off 28,000 employees as Covid-19 affects its theme park business
Disney to lay off 28,000 employees as Covid-19 affects its theme park business
Credit: Joe Penniston (Creative Commons Attribution 2.0)

In a memo sent to employees on Tuesday, Disney announced it would lay off 28,000 employees across its parks, experiences and consumer products segment. Around 67% of the laid-off workers were part-time employees.

The company blamed prolonged closures and capacity limits at open parks for the layoffs. While Disney's theme parks in Florida, Paris, Shanghai, Japan and Hong Kong have been able to reopen with limited capacity, both California theme parks have remained shuttered.

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EasyJet is "hanging by a thread" due to Covid-19 pandemic, union official says
EasyJet is "hanging by a thread" due to Covid-19 pandemic, union official says
Credit: unsplash.com/Frederick Tubiermont

According to a union official, the impact of the Covid-19 pandemic has left the British low-cost airline group EasyJet "hanging by a thread".

"If easyJet don’t have a good summer and make money next summer, I suspect none of us will have a job this time next year," pilots’ union official Martin Entwisle said in a now leaked recording of an EasyJet staff conference call. Entwisle claimed the information was shared by the company’s chief financial officer, Andrew Findlay, who allegedly warned that the company's situation was "even worse than their worst fears."

"The easiest way to put it is: the company is hanging by a thread," Entwisl added.

EasyJet has denied that Entwisl's comments "reflect what EasyJet or its finance officer said."

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Investment bank JPMorgan announces move of €200 billion in assets from UK to Germany following Brexit
Investment bank JPMorgan announces move of €200 billion in assets from UK to Germany following Brexit
Credit: unsplash.com / Igor Flek

According to reports by Bloomberg, the investment bank JPMorgan Chase & Co. is moving assets worth around €200 billion from the United Kingdom to Frankfurt, Germany. The reason for the move is the end of the transition period and the Brexit with the United Kingdom leaving the European Union.

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Spanish Supreme Court rules that riders for delivery companies are falsely self-employed
Spanish Supreme Court rules that riders for delivery companies are falsely self-employed
Credit: unsplash.com / Connor Houtman

The Spanish Supreme Court ruled on Wednesday that the riders are wage earners and are therefore now working as falsely self-employed. "The relationship between a rider and Glovo is of a labor nature," says the note issued by the Supreme Court, which adds that the company "is not a mere intermediary in the hiring of services between stores and rider"

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Facebook to open new office in Lagos in 2021
Facebook to open new office in Lagos in 2021
Credit: unsplash.com/Brett Jordan

Facebook will open its second African office in Lagos, Nigeria in 2021 to support the Sub-Saharan region, the company said in a statement.

“The opening of our new office in Lagos, Nigeria presents new and exciting opportunities in digital innovations to be developed from the continent and taken to the rest of the world," the Head of New Product Experimentation Ime Archibong said. “All across Africa we’re seeing immense talent in the tech ecosystem, and I’m proud that with the upcoming opening of our new office, we’ll be building products for the future of Africa, and the rest of the world, with Africans at the helm. We look forward to contributing further to the African tech ecosystem.”

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Spain: CaixaBank and Bankia merger blessed by shareholders
Spain: CaixaBank and Bankia merger blessed by shareholders
Credit: CaixaBank

Spanish banks CaixaBank and Bankia teams agreed to a merger that would create an entity with total assets of about 665 billion. Reuters reports that sources close to the deal confirmed the main shareholders greenlight the merger, to be signed in the next few days.

The new bank would surpass Santander and BBVA in the Spanish market with a combined market share of around 30%. Both Santander and BBVA would remain bigger globally, but not in Spain.

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Austria reports 20% decline in sales of new cars since beginning of 2020
Austria reports 20% decline in sales of new cars since beginning of 2020
Credit: GFreihalter (Creative Commons Attribution 3.0)

The Austrian car sales are heavily impacted by the Covid-19 pandemic, which led to a -67% and -65% decline in sales in March and April. The market since then recovered to a low of -18% in June and went back to -20% in August.

The statistics are based on the registration number of new cars per month.

Business • Economy
Report: 45 of 58 Austrian publicly traded companies have all-male boards
Report: 45 of 58 Austrian publicly traded companies have all-male boards
Credit: unsplash.com / M. B. M.

According to a report from the consultancy Ernst & Young out of 58 Austrian companies that are publically traded at the stock exchange, only 13 have a female board member. In total out of 191 board members, only 14 are female.

Every fourth company does not fulfill the quorum of 30%.

Business • Economy
GDP falls 9.7% record in the 2nd quarter and Brazil enters recession again
Closed stores in Santos, Brazil
Closed stores in Santos, Brazil Credit: Marcelo dos Santos

The Gross Domestic Product (GDP) of Brazil had a historical fall of 9.7% in the 2nd quarter, in comparison with the first 3 months of the year, due to the impact of the coronavirus crisis,

With a pandemic, the Brazilian economy regressed to the level of late 2009.

Business • Economy
Insolvency administrator considers Wirecard not capable of being restructured
Insolvency administrator considers Wirecard not capable of being restructured
Credit: Leo Molatore (Creative Commons Attribution ShareAlike 2.0)

According to a progress report of the insolvency administrator Michael Jaffé the situation is too desolate for resturcturing, after years of reporting profits, but in reality accumulating losses.

Following the report a mountain of debt of more than 3.2 billion euros is offset by usable assets of only 428 million, which means that the company is over-indebted by around 2.8 billion euros. In liquid assets there are only 26.8 million euros left. These figures are the result of a long series of losses.

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Department store chain Lord & Taylor to close all its stores
Department store chain Lord & Taylor to close all its stores
Credit: Lord & Taylor

After 194 years in business, the American department store chain Lord & Taylor is closing all its 38 remaining stores after filing bankruptcy on August 2 and has begun liquidation sales.

"While we are still entertaining various opportunities, we believe it is prudent to simultaneously put the remainder of the stores into liquidation to maximize value of inventory for the estate while pursuing options for the company's brands," so Lord & Taylor's chief restructuring officer Ed Kremer.

Business • Economy
US: Powell announces new Fed approach to inflation that could keep rates lower for longer

Fed Chairman Jerome Powell announced a major policy shift Thursday to "average inflation targeting."

That means the central bank will be more inclined to allow inflation to run higher than the standard 2% target before hiking interest rates.

"Many find it counterintuitive that the Fed would want to push up inflation," Powell said in prepared remarks. "However, inflation that is persistently too low can pose serious risks to the economy."

Business • Economy
Jeff Bezos' net worth surpasses $200b
Jeff Bezos at Amazon Spheres Grand Opening in Seattle, 2018
Jeff Bezos at Amazon Spheres Grand Opening in Seattle, 2018 Credit: Seattle City Council from Seattle / Wikimedia Commons (Creative Commons Attribution 2.0)

Amazon CEO Jeff Bezos' net worth has reached approx. $202 billion, a $87 billion increase since January. Amazon's stock has seen a 25%-rise since June and 86%-rise since the start of the year, boosted mostly by online shopping during the pandemic.

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Airbnb files to go public
Airbnb files to go public
Credit: Open Grid Scheduler / Grid Engine (Public Domain)

Airbnb announced on Wednesday that it had confidentially filed to go public. Reports indicate the company could have an IPO as soon as the end of the year.

The company had been privately valued at $31 billion before this year and it must now convince investors that it can thrive and turn a profit in a new era of limited travel.

Business • Economy
Tencent smash second quarter earnings expectations due to strong games demand
Tencent smash second quarter earnings expectations due to strong games demand
Credit: Tencent

Tencent reported on Wednesday results. for the three months through to the end of June. that beat analyst expectations in one of the fastest revenue-growing quarters in two years.

The company is one of the targets of the executive order signed by President Donald Trump, prohibiting any transaction related to WeChat, the popular messaging app owned by Tencent.

Revenue from online games, which accounts for one-third of total sales, increased 40% in the second quarter, primarily driven by mobile games including Honor of Kings and Peacekeeper Elite.

Business • Economy
UK officially in recession for first time in 11 years
UK officially in recession for first time in 11 years
Credit: Franck V.

The UK economy suffered its biggest slump on record between April and June as coronavirus lockdown measures pushed the country officially into recession.

The economy shrank 20.4% compared with the first three months of the year.

Business • Economy
Disney reports $4.7b loss in third quarter
Disney reports $4.7b loss in third quarter
Credit: Coolcaesar / Wikimedia Commons (Creative Commons Attribution ShareAlike 4.0)

Walt Disney Co. reports its first quarterly loss since 2001 largely due to the Covid-19 pandemic, with a loss of $4.72 billion in its third fiscal quarter ending with June 27.

Amid the Covid-19 pandemic, Disney had to close its theme parks and lost revenue from theatrical parks, live sports and movie distribution. However, due to people staying at home, Disney+ has gained over 60 million subscribers in less than nine months.