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Mutant coronavirus strain could lead to food shortages in the U.K.



Mutant coronavirus strain could lead to food shortages in the U.K.

The U.K. is facing the threat of critical food shortages, including for fresh fruit and vegetables, just days before Christmas, as European countries impose bans on transit from the country in response to the discovery of a mutant strain of coronavirus in southern England.

The French government imposed a 48-hour ban on both people and trucks coming into the country from the U.K., starting today. The decision is likely to cripple U.K. trade with the rest of Europe, much of which crosses between Calais, in France, and Dover[/hotlink], in England.

The potential food shortages are a grim irony for a country that had been racing to meet a December 31 deadline to secure a trade deal with the European Union that was meant to prevent exactly such a prospect.

The English Channel crossing between Dover and Calais handles up to 10,000 trucks per day, 90% of all truck traffic entering the country. About half of all British imports cross that border. In addition, about 50% of the food Britons consume—and up to 85% of the fresh fruit and vegetables the country eats—come from the EU, much of it shipped by trucks which cross the English Channel on ferries or the Eurotunnel train from France.

While there is no ban on these trucks arriving in Britain, many freight haulers are reluctant to send drivers to the U.K. without the certainty of knowing they will be able to make the return crossing back to mainland Europe.

British Prime Minister Boris Johnson on Monday was planning to hold emergency talks with his government ministers on how to ensure the continued flow of freight into the country. Meanwhile, European Union officials were holding a crisis committee meeting to coordinate response to the new mutant coronavirus variant.

In addition to France, Austria, Belgium, Finland, Germany, Ireland, Italy, and the Netherlands have all blocked U.K. arrivals. Further afield, Israel turned back visitors arriving from the U.K. and Hong Kong banned flights from Britain in response to the new mutant strain.

The new variant of SARS-CoV-2, the virus that causes Covid-19, has emerged in southern England in recent weeks. British government scientists said on Saturday that tests had shown the new strain was 70% more transmissible than the original virus. But they said there was no evidence so far that the new variant was more likely to cause serious illness or that the current crop of Covid-19 vaccines being rolled out across the world would not protect against it.

The imposition of travel bans on British citizens seems to have largely been the result of the Johnson government’s own sudden decision on Saturday to impose stringent restrictions on movement, socializing and business for large parts of southern England, where the new strain is most prevalent. That move was a sharp U-turn for Johnson, who had imposed a national lockdown in November in an effort to stem a huge spike in infections, centered largely in the north of England, and had been planning to relax social distancing measures over the Christmas holidays.

Parts of the U.K. government seem to have been aware of the new strain for some time. British labs first detected in early October in a sample taken from someone in late September. But concern about the mutant strain seems to have been subdued until the U.K. began experiencing a massive second wave of Covid-19 infections in October and November. With new cases totaling more than 25,000 people per day by early December, scientists realized that the new strain was now responsible for a large number of these—accounting for the majority of new cases in London and eastern England and about half of those in southeast England.

Matt Hancock, the U.K. health minister, first mentioned the new strain publicly in a speech to Parliament on December 14. He said at the time that the World Health Organization had been notified about the new variant. But Hancock said that it was not until Friday that he and Johnson and a wider group of ministers were fully briefed on the alarming figures about the increased transmissibility of the new strain by an expert advisory group that works on new and emerging respiratory virus threats.

The new travel bans also comes at a critical moment in negotiations between the U.K. and the EU on an agreement to govern their trading relationship after December 31, when a one-year Brexit transition period expires. Despite years of talks, negotiators have so far failed to reach a deal—and missed another deadline for reaching one on Sunday as disagreements between the two side remained on issues such as fishing rights.

Without a deal in place, the U.K. will likely face chaos along the Dover-Calais trucking route, with new paperwork and customs checks likely leading to miles-long tailbacks on both sides of the English Channel, and warnings these delays could lead to food shortages. As a result, many retailers and grocers have been attempting to stockpile supplies in advance of January 1 and the road approaches to the Channel crossings have already been congested for weeks due to the additional truck traffic.

More health care and Big Pharma coverage from Fortune:

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  • “There simply isn’t the trust”: The fight to overcome vaccine skepticism in the Black community
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  • Here’s how much Europe will pay for each COVID-19 vaccine


Coinbase’s near-term outlook is ‘still grim’, JPMorgan says, while BofA is more positive about firm’s ability to face crypto winter



Coinbase's near-term outlook is 'still grim', JPMorgan says, while BofA is more positive about firm's ability to face crypto winter

Coinbase is well positioned to successfully navigate this crypto winter and take market share, Bank of America said in a research report Tuesday. It maintained its buy recommendation following the exchange’s second-quarter results.

The results warrant “a muted stock reaction,” the report said. Net revenue of $803 million was below the bank’s and consensus estimates, while its adjusted $151 million loss before interest, tax, depreciation and amortization was better than the street expected. Importantly, the company remains “cautiously optimistic” it can reach its goal of no more than $500 million of adjusted EBITDA loss for the full year, the report added.

Coinbase shares fell almost 8% in premarket trading to $80.74.

Bank of America notes that Coinbase had no counterparty exposure to the crypto insolvencies witnessed in the second quarter. The company also has a “history of no credit losses from financing activities, holds customer assets 1:1, and any lending activity of customer crypto is at the discretion of the customer, with 100%+ collateral required.” These rigorous risk-management practices will be a “positive long-term differentiator” for the stock, the bank said.

JPMorgan said Coinbase had endured another challenging quarter, while noting some positives.

Trading volume and revenue were down materially. Subscription revenue was also lower, but would have been much worse were it not for higher interest rates, it said in a research report Wednesday.

The company is taking steps on expense management, and in addition to the June headcount reductions, is scaling back marketing and pausing some product investments, the note said.

The bank says the company’s near-term outlook is “still grim,” noting that the exchange expects a continued decline in 3Q 2022 monthly transacting users (MTUs) and trading volumes, but says Coinbase could take more “cost actions” if crypto prices fall further.

JPMorgan is less optimistic than Bank of America about the company in the near term, saying pressure on revenue from falling crypto markets will have a negative impact on the stock price. Still, it sees positives including higher interest rates, from which the firm will generate revenue. It also sees opportunities for the exchange to grow its user base, leveraging almost $6 billion of cash. The surge in crypto prices in July, and the forthcoming Ethereum Merge are also seen as positive catalysts, it added.

The bank maintained its neutral rating on the stock and raised its price target to $64 from $61.

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Elon Musk sold $6.9B in Tesla stock in case he’s forced to buy Twitter



Elon Musk sold $6.9B in Tesla stock in case he's forced to buy Twitter

Elon Musk sold $6.9 billion of his shares in Tesla Inc., the billionaire’s biggest sale on record, saying he needed cash in case he is forced to go ahead with his aborted deal to buy Twitter Inc.

“In the (hopefully unlikely) event that Twitter forces this deal to close *and* some equity partners don’t come through, it is important to avoid an emergency sale of Tesla stock,” Musk tweeted late Tuesday after the sales were disclosed in a series of regulatory filings. 

Asked by followers if he was done selling and would buy Tesla stock again if the $44 billion deal doesn’t close, Musk responded: “Yes.”

Tesla’s chief executive officer offloaded about 7.92 million shares on Aug. 5, according to the new filings. The sale comes just four months after the world’s richest person said he had no further plans to sell Tesla shares after disposing of $8.5 billion of stock in the wake of his initial offer to buy Twitter.  

Musk last month said he was terminating the agreement to buy the social network where he has more than 102 million followers and take it private, claiming the company has made “misleading representations” over the number of spam bots on the service. Twitter has since sued to force Musk to consummate the deal, and a trial in the Delaware Chancery Court has been set for October. 

In May, Musk dropped plans to partially fund the purchase with a margin loan tied to his Tesla stake and increased the size of the equity component of the deal to $33.5 billion. He had previously announced that he secured $7.1 billion of equity commitments from investors including billionaire Larry Ellison, Sequoia Capital, and Binance. 

“I’ll put the odds at 75% that he’s buying Twitter. I’m shocked,” said Gene Munster, a former technology analyst who’s now a managing partner at venture-capital firm Loup Ventures. “This is going to be a headwind for Tesla in the near term. In the long term, all that matters is deliveries and gross margin.”

At the weekend, Musk tweeted that if Twitter provided its method of sampling accounts to determine the number of bots and how they are confirmed to be real, “the deal should proceed on original terms.” 

Musk, 51, has now sold around $32 billion worth of stock in Tesla over the past 10 months. The disposals started in November after Musk, a prolific Twitter user, polled users of the platform on whether he should trim his stake. The purpose of the latest sales wasn’t immediately clear.  

Tesla shares have risen about 35% from recent lows reached in May, though are still down about 20% this year. 

With a $250.2 billion fortune, Musk is the world’s richest person, according to the Bloomberg Billionaires Index, but his wealth has fallen around $20 billion this year as Tesla shares declined.    

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The rent is too d*mn high for Gen Z: Younger generations are ‘squeezed the most’ by higher rents, BofA says



The rent is too d*mn high for Gen Z: Younger generations are 'squeezed the most' by higher rents, BofA says

Most of Gen Z is too young to remember the 2010 New York gubernatorial candidate Jimmy McMillan.

But over a decade later, they would probably agree with his signature issue (and catchphrase): the rent is too damn high.

This July, median rent payments were 7.4% higher than during the same period last year, according to a Bank of America report released Tuesday. 

The national median price for a one-bedroom apartment has been hitting new highs nearly every month this summer. It was $1,450 for July, according to rental platform Zumper. In the country’s largest city, New York, average rent exceeded a shocking $5,000 a month for the first time ever in June. 

But inflation in the rental market hasn’t hit each generation equally, and no one is getting squeezed harder by the higher monthly payments as Gen Z. Those born after 1996 have seen their median rent payment go up 16% since last July, compared to just a 3% increase for Baby Boomers, BofA internal data shows. 
“Younger consumers are getting squeezed the most by higher rent inflation,” BofA wrote.

The great rent comeback

Early in the pandemic, landlords slashed rents and gave significant COVID discounts to entice tenants to stay instead of leaving urban areas. Once those deals started expiring in 2021, many landlords suddenly raised payments once again, sometimes asking for over double their pandemic value. 

Young people across the board have been hit hard, and rent burdens compared to age can be seen even within a single generation. Younger millennials had their median rent payment grow 11% from last year, while the median payment for older millennials rose 7%. Gen X experienced a 5% median rent increase, according to BofA. 

It’s not a surprise, then, that Gen Z feels so strapped for cash. The majority of young people, 61%, said they want to receive their wages daily instead of twice a week, a practice typically reserved for workers living paycheck to paycheck, according to a report from the Center for Generational Kinetics, which specializes in research across the generations. Rising rent inflation has even priced nearly a third of Gen Zers out of the apartment search altogether. Around 29% of them have resorted to living at home as a “long-term housing solution,” according to a June survey from personal finance company Credit Karma.

It’s no wonder—the rent really is too high.

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