2020年1月23日 星期四

DealBook: Fears Over New Coronavirus Grip Davos

As China closes off cities affected by the growing viral outbreak, business leaders at the World Economic Forum fear a replay of the SARS epidemic.
January 23, 2020
Good morning from Davos, Switzerland, where business leaders are worried about the growing coronavirus outbreak. More below. (Was this email forwarded to you? Sign up here.)
  Denis Balibouse/Reuters
The big worries at Davos: disease and trade
Attendees of the World Economic Forum in Davos are fretting about global trade in the face of threats from trade battles, the coronavirus outbreak and more.
• Executives are worried about China’s coronavirus and how its spread will affect business in the hugely important market. Some expressed their fears yesterday with President Trump, who responded that he wasn’t concerned. (More on the outbreak below.)
• Treasury Secretary Steven Mnuchin is annoyed that European countries are still weighing special taxes on American internet companies, saying this morning that creating a global minimum tax was more important and more fair.
Mr. Trump appeared more preoccupied by Boeing — “big, big disappointment to me,” he said — and the impeachment trial in the Senate.
The Davos roundup:
• Sheryl Sandberg of Facebook said at a private party that the company would help users improve their privacy practices on the social network.
• Why Davos attendees’ preferred way to fight climate change is planting trees.
The cannabis industry is trying to get a piece of the action at Davos.
Today’s DealBook Briefing was written by Andrew Ross Sorkin in Davos and Michael J. de la Merced in London.
Attending to a patient at the Central Hospital of Wuhan.
Attending to a patient at the Central Hospital of Wuhan.  The Central Hospital Of Wuhan/Via Reuters
The toll of closing of Chinese cities amid outbreak
Chinese officials have closed off the city of Wuhan, the epicenter of a growing viral outbreak, and nearby Huanggang and Ezhou. It’s the latest sign of how serious matters have become, with at least 17 people dead and 570 sickened in countries around the world.
Wuhan “is the hub of industry and commerce in central China, home to the region’s biggest airport and deepwater port and sometimes known as the Chicago of China,” Amy Qin and Vivian Wang of the NYT write.
The outbreak could also have economic effects outside China. Analysts at Goldman Sachs warned clients that it could “shave $3 from oil prices thanks to a slowdown in air travel,” Pippa Stevens of CNBC reports.
Beijing is worried about a repeat of the SARS epidemic, in which Chinese officials initially obscured the seriousness of the crisis, Ms. Qin and Ms. Wang add. That illness ultimately led to 800 deaths worldwide.
Jeff Bezos
Jeff Bezos  Joshua Roberts/Reuters
Report details how Jeff Bezos’ phone was hacked
An alleged plot to infiltrate the Amazon chief’s phone appears to have involved an international cast of hackers and Crown Prince Mohammed bin Salman of Saudi Arabia, according to a report commissioned by Mr. Bezos and endorsed by U.N. investigators. Here’s how it played out, writes Sheera Frankel of the NYT.
• Mr. Bezos exchanged phone numbers with Prince Mohammed at a dinner in L.A. in 2018. (Here’s who else was at that gathering.)
• A WhatsApp account tied to the crown prince then began repeatedly contacting Mr. Bezos, without prompting.
• On May 1 that year, the WhatsApp account sent Mr. Bezos a video file of about 4.4 megabytes, with about 14 bytes of malicious code. It’s not clear from the report whether Mr. Bezos opened it.
• Within 24 hours, Mr. Bezos’ iPhone X began sending about 29,000 times its normal data usage.
• Messages sent by Prince Mohammed’s WhatsApp account later that year indicated that the sender knew Mr. Bezos was discussing divorce with his wife, MacKenzie.
The report said the spyware probably came from the NSO Group of Israel and the Hacking Group of Italy.
U.N. experts endorsed the report and called on the U.S. and others to investigate the accusations. “The hacking of Jeff Bezos is in a different league,” Agnès Callamard, one of the experts, said in a statement. She added that “his hacking appears to have been driven by his ownership of The Washington Post.”
It’s unclear what the Trump administration will do, given that it regards Prince Mohammed as an important ally and Mr. Bezos as the owner of a newspaper that irritates President Trump. An unnamed U.S. official told the WSJ that the administration was “concerned” about the accusations.
Inside Microsoft’s big fight with the I.R.S.
For years, the tech giant saved on taxes by shifting at least $39 billion in profits to Puerto Rico. The I.R.S. took aim at the arrangement — but, as Paul Kiel of ProPublica reports, the agency has been bombarded by Microsoft’s money and lobbying.
• Microsoft’s arrangement involved selling intellectual property to an 85-person factory that it owned in a small Puerto Rican city. Its tax consultants at KPMG had persuaded the government to give the company a tax rate of nearly zero percent.
• A small I.R.S. team leading an audit of Microsoft “used special powers that the agency had shied away from using in the past,” Mr. Kiel writes. “It took unprecedented steps like hiring an elite law firm to join the government’s side.”
• Microsoft rallied trade groups to its side in the legal fight and lobbied Republicans and Democrats alike to oppose the I.R.S.’s tactics.
The big picture: “Microsoft’s war with the I.R.S. offers a rare view into how a giant company maneuvers to avoid taxes — and how it responds when the government tries to crack down.”
Elon Musk has 100 billion reasons to dance.
Elon Musk has 100 billion reasons to dance.  Aly Song/Reuters
Tesla’s market value hit $100 billion. Now what?
Elon Musk’s dream of having the electric carmaker’s market capitalization surpass $100 billion has been realized. Yet the hard work continues, Niraj Chokshi of the NYT notes.
Tesla’s stock has been on a strong run over the past three months, raising the company’s market value above rivals like G.M. and Ford.
The accomplishment puts Mr. Musk on the cusp of a big payday. If Tesla’s market cap can stay above $100 billion for six months, including 30 consecutive days, he’s entitled to buy about 1.69 million shares for about $350 each — a payout that would be worth about $370 million before taxes at Wednesday’s price.
There are plenty of buts. Tesla is under regulatory scrutiny for crashes involving its vehicles, and questions remain about the stability of its business and its dependence on overseas sales, especially in China.
And there are still plenty of doubters. The number of Tesla shares being shorted is equivalent to about 20 percent of its overall stock count.
  Gabriela Bhaskar for The New York Times
Fairway files for bankruptcy
The New York City grocery chain filed for Chapter 11 protection last night, the second time in four years it has done so. That puts the fate of the Manhattan institution into question.
The company said it would hold an auction for its operations, including its 14 stores. It has a “stalking horse” agreement to sell five stores to Village Super Market, the operator of the rival ShopRite chain, for $70 million, though another bidder could top that offer.
Fairway had disputed a report that it would file for Chapter 7 bankruptcy, in which companies liquidate themselves with no hope of a turnaround. “Despite reports, Fairway Market has no intention to file for chapter 7 or liquidate all of its stores,” it said in a statement, though it hinted at an alternative plan.
The context: The company struggled from debt it took on as part of an ambitious plan to expand beyond Manhattan. It also suffered from competition like Whole Foods, Trader Joe’s and Amazon. It filed for Chapter 11 in 2016, though an executive said in 2018 that it had “bounced back.”
The speed read
• Alphabet’s GV division and other investors have bought out WeWork’s stake in The Wing, a co-working start-up aimed at women. (Fortune)
• John Malone’s Liberty Global is reportedly working on a takeover bid for Univision. (Bloomberg)
• Permira agreed to sell the consultancy Duff & Phelps to two other buyout firms, Further Global and Stone Point Capital, for $4.2 billion. (FT)
• The production company behind the hit podcast “Serial” is said to be considering a sale. The NYT is reportedly a potential suitor. (WSJ)
Politics and policy
• The Fed did not prevent the U.S. economy from growing 4 percent, as President Trump claimed. (NYT)
• Bankers in Europe are increasingly complaining about negative interest rates. (FT)
• Britain’s Parliament finalized the bill that will take the country out of the E.U. (NYT)
• The popular social network TikTok is becoming a political battleground. It’s also reportedly searching for a new C.E.O., who would be based in the U.S. (Vox, Bloomberg)
• Attorney General Bill Barr has threatened to review a law protecting social networks from legal liability for content on their platforms as part of his campaign against big tech. (Information)
• “Mysterious GPS outages are wracking the shipping industry.” (Fortune)
Best of the rest
• Health insurers have pledged to invest $55 million to develop cheaper generic drugs. (NYT)
• Gov. Gavin Newsom of California objected to PG&E’s deal with bondholders to exit bankruptcy. (NYT)
• Starbucks says it will encourage customers to try nondairy milk products to reduce its carbon footprint. (Bloomberg)
• The Giants quarterback Eli Manning is retiring from the N.F.L. after 16 years. Here’s what many consider his greatest moment. (NYT, YouTube)
Thanks for reading! We’ll see you tomorrow.
We’d love your feedback. Please email thoughts and suggestions to business@nytimes.com.
Get unlimited access to NYTimes.com and our NYTimes apps. Subscribe »
Copyright 2020 The New York Times Company
620 Eighth Avenue New York, NY 10018
View in Browser