Deltacron is here
Also in today’s edition: iMessage snobbery; Crypto crashes; GDP bounces; Back to Zoom
Good morning! Have you heard of Mukesh Ambani, the hotelier? Well, around the time when the Ambanis were building their home Antilia in Mumbai, Reliance Industries also picked up a stake in East India Hotels, which runs the luxury Oberoi hotels. The Oberoi helped train the staff at Antilia. It also manages Reliance’s property in Navi Mumbai. Since then the group has bought the 300-acre British icon, Stoke Park, for $79 million, and now New York’s Mandarin Oriental for a cool $98 million.
Btw, our podcast has been going strong for three months now. Tune in on your daily jog, drive to the office, or even as you WFH-ers have breakfast in bed. We promise it’ll be music to your ears.
The Market Signal
Stocks: The first week of the new year started off with a bang for stocks. Eight out of the top-10 most valued companies added ₹2.5 trillion to their market cap. The prospect of a Fed rate hike has popped speculative bubbles across assets all over the world. In the next few weeks, investors are likely to be picky where they put their money.
A Needle To Poke The Encryption Bubble
Looks like our namesake, the encrypted messaging app, might be wading into dangerous waters. Its initial bid to offer anonymous payments via the app raised concerns. Now, with Signal opening up MobileCoin integration to the rest of the world, it could provide regulators with a significant opening to break end-to-end encryption, as per Platformer’s Casey Newton. This development has repercussions.
Wild West: Signal’s bet on payments stands apart, as Newton explains, because its “features are designed to make any transactions anonymous”, which is exactly what…umm the bad guys are looking for.
On the prowl: Governments (including India), and regulators want to break encryption. They have used multiple entry points such as the proliferation of child sexual abuse material, drug and national security concerns to make their case. With this move, particularly around anonymous payments, Signal could end up only bolstering the arguments.
FOMO: While on messaging apps, FOMO and peer pressure is working for Apple, especially among young users. How? The blue chat bubble of the iMessage app is the new cool. So much so that teens and college users are being ostracised for using “green text” (Android).
Hiroshi Lockheimer @lockheimerApple’s iMessage lock-in is a documented strategy. Using peer pressure and bullying as a way to sell products is disingenuous for a company that has humanity and equity as a core part of its marketing. The standards exist today to fix this. https://t.co/MiQqMUOrgn
Crypto Hits A Trough
Bitcoin prices have been falling for seven days, coming within hair’s breadth of breaching the $40,000 mark.
Gold standard: Bloomberg calls it the crypto winter although investment bank Goldman Sachs considers Bitcoin on a par with gold as a store of value and expects its price to top $100,000 not too far in the future.
Froth off: There are multiple apparent causes, including a looming interest rate hike in the US, an Internet shutdown in Kazakhstan and a Bitcoin scam in Pakistan. While the Internet shutdown and scam may have contributed to the fall, the imminent increase in interest rates seems to be wiping away froth from the highly speculative crypto market. Bitcoin’s fall is in line with corrections in other assets such as shares and gold. Even meme coins such as Doge and Shiba Inu have slumped. Looks like heading “to the moon” might just seem a little distant this January.
Tracking The Third Wave
Here’s a crossover episode no one asked for. Cyprus has discovered deltacron, a strain of Covid-19 that combines the Delta and Omicron variants.
On a loop: India logged 159,632 Covid-19 infections on Sunday, a record single-day spike. Weeks before the Budget session of Parliament was to begin, 400 staffers have tested positive for Covid-19. Capital Delhi has another deterrent–ailing healthcare workers. At least 750 doctors and hundreds of paramedics across six top hospitals are infected.
While cases are surging, IIT-Kanpur professor, Manindra Agrawal’s computer model showed the wave peaking by February 2022; mid-January in Mumbai and Delhi.
Unrelenting: Global coronavirus cases surpassed 300 million on January 7. The UK crossed 150,000 Covid deaths since the pandemic, the first country in Europe to do so. Hospitalisation in the US is reaching a record high.
Meanwhile, a study appears to have unravelled the causes of long Covid.
Think of Omicron as the Usain Bolt of Covid-19 variants. The variant is outpacing its previous counterparts. India’s leading virologist T Jacob John told a seminar that the Omicron variant might have evolved its mutations in a rodent, maybe a year ago.
The virus does not easily infect lungs, he notes. Most patients will scrape through with flu-like symptoms. But old people, those with risk-prone medical conditions and pregnant women will be at high risk.
It may not be much comfort if Deltacron is as fast-spreading as Omicron and as lethal as Delta. The researchers who found it believe it is not. Phew!
Tightfisted Govt Keeps Deficit In Bounds
There is good news and bad news. Indian economy will likely grow at 9.2% in FY22, early estimates suggest. It’s from a low base but nevertheless shows improved economic activity. The government will also likely show a lower fiscal deficit because it has not spent as much as it had budgeted.
Job losses: The bad news is that the pandemic has pushed a good number of workers in the formal economy to the informal sector. Among low-paid but permanent salaried workers, only three out of 10 were able to retain their jobs. The rest are either self-employed or become casual workers.
Omicron impact: The GDP estimates are based on the past three quarters and the trend may be impacted by the ongoing third wave of Covid-19 which has forced curfews in cities such as Delhi and Mumbai and also imposed curbs on inter-state and international travel. The tourism and travel industry, one of the biggest employers, has been affected again.
Back to Work From Home
A dog’s obeyed in office, Shakespeare wrote in King Lear. Not anymore, it seems. Employees are increasingly unwilling to put up with mean bosses.
But remote work, it would appear, is here to stay, however performative it might seem. The Omicron surge has shuttered offices again, and companies are responding, as they’ve done in the last 24 months: sending workers home.
To Stay: Indian companies and startups such as Cognizant, Amazon, Flipkart and RazorPay are re-adopting the WFH. Many IT firms had reopened offices or aimed to recall staff in 2022, but are instead staying closed.
No-jab, no-job: Meanwhile, Citigroup, which had called people back to office, has not only made WFH optional but also plans to fire the unvaccinated. Other US companies such as Goldman Sachs, Morgan Stanley and JPMorgan have simply told the unvaccinated staff to stay at home.
Poll bound: Five Indian states, including the largest, Uttar Pradesh, will hold assembly elections starting February 10. Retaining Uttar Pradesh will be a boost to the ruling BJP which had lost West Bengal in the last state-level dust-up.
Keeping in check: The Competition Commission of India (CCI) has ordered a probe against Google over denial of digital advertising revenue to news publishers. Meanwhile, Amazon has dragged the CCI to the National Company Law Appellate Tribunal.
Get back, bigger: Parler, the conservative social media app, which was temporarily taken down from the App Store after the January 6 Capitol riot, has raised $20 million in new funding.
Timely: The Reserve Bank of India has set up a “fintech department”, which, among other things, could also look at fintech regulations.
New position: Ex-RBI Governor Urjit Patel has been appointed as a vice-president of the Beijing-based Asian Infrastructure Investment Bank.
Superstar investor: Microsoft CEO Satya Nadella joined online trading platform Groww as an investor and advisor. Some catch!
Gates of hell: Darvaza Gas Crater is a five-decade-old fire in a giant natural gas hole after a Soviet drilling operation went south in 1971. It also doubles up as a well-trodden tourist spot. Now, Turkmenistan's president Gurbanguly Berdymukhamedov wants to shut it down, citing environmental concerns. There have been previous attempts to put out the fire. It remains to be seen if his plans fall in place this time around.
Four-footed fire-fighters: Australia has a new game plan to tackle bush fires. Goats are being called in to chew grass and scrublands in New South Wales, Australia. Forty goats were first called in to prove their mettle. And prove they did. At Lue in New South Wales, the recruits have chomped through 25 acres of land, already licking half of their target.
Mystery book thief: Filippo Bernardini, an Italian employee of Simon and Schuster, was arrested for stealing unpublished book manuscripts by authors, including Margaret Atwood and Ethan Hawke. Bernardini has pleaded not guilty and has been released on bail for $300,000.
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