In September last year, Australia finalized a deal called AUKUS with the US and the UK, which would help the Aussies develop nuclear submarines. While this is all fine and well, initially, it was France that was going to help Australia with French-made submarines in a contract worth around US$66 billion. But according to sources, France was always running over budget and behind schedule. Plus, Australia was worried that another deal with the EU nation would mean that by the time they got their submarines, they would be outdated.
So Australia went ahead and made a deal with the US and UK and didn’t tell France until the last minute. The French were angry, canceling a Washington gala, labeling the behavior as Trump-like and saying it was “really a stab in the back.” Now, a new Australian leader is in office. Albanese has plans to make a detour to Paris on the way to Madrid for the NATO summit this week to smooth things out with France’s Macron. This comes after Australia announced it would pay France around US$584 million for walking back the original contract.
At the end of May, Macron called Albanese to congratulate him on winning the election. During their chat, they agreed to “rebuild a bilateral relationship founded on trust and respect,” according to a statement released after the call.
This means that several of the NATO battlegroups in eastern Europe will be upgraded to brigade level, meaning there will be thousands of tactical troops at the ready, including a mixture of land, sea and air forces. The move, Stoltenberg said, is to deter Russia from making any moves that would further infringe on European sovereignty or the sovereignty of any NATO members.
This also comes as Finland and Sweden are in the process of joining NATO, breaking decades of neutrality and non-alignment.
For many of the high-readiness forces so far, the start of Ukraine’s invasion was the first time they had been set to that status. These multinational battlegroups are stationed in a number of countries bordering Russia, including Poland, Lithuania, Latvia and Estonia. More battlegroups are reportedly planned to be stationed in Hungary, Bulgaria, Romania and Slovakia.
Russia’s debt default
On Sunday, Russia defaulted on its nation’s foreign-currency debt for the first time in a century because of Western sanctions that essentially made it impossible for the country to pay back its creditors. Up to now, the Kremlin has found ways around the restrictions on different payment methods. But, when the grace period for its around US$100 million interest payments ended, it marked a historic first.
But some people are saying that this isn’t a huge deal because of the damage done to the Russian economy since the Ukraine war started, with the people of Russia dealing with a huge economic slowdown and soaring inflation. Russia has said that this default doesn’t really count since the nation technically has the ability and the willingness to pay back its debts, but it’s just being held back by foreign governments. It has now said that all future payments would be made in rubles through a Russian bank, regardless of the original payment terms.
Now the focus is on the bondholders, many of which are expected to just wait to see how the situation unfolds and whether the sanctions ease.
To end, we’ll look into:
Airbnb will shell out US$10 million for wacky and unique stays
You’ve probably heard the story about the old lady who lives in a shoe, and the Hobbits who live on the sides of hills. But did you know there’s funding available for wacky housing projects like that?
Airbnb is giving away US$10 million in something called the “OMG! Fund” for crazy, weird, bizarre and interesting housing designs. The pot will be split between 100 people, with each getting US$100,000 to create unforgettable stays like the Big Idaho Potato Hotel in Boise, Iowa, which, you guessed it, looks like a big ol’ potato, or the Deluxe Covered Wagon stay near Las Vegas that offers horse rides, rodeos and other cowboy fun.
The idea is that this will spur some creative stays on the getaway housing platform during a summer the company (and others like Expedia and Booking Holdings Inc) expects to be one of the best the industry has ever seen. Airbnb said that stays at unique locations have increased by nearly 50% from 2019 to 2021, and it’s leaning into the idea that instead of a cookie-cutter hotel room, one might as well stay somewhere different.
But others are more skeptical about the summer being a good one for the travel industry, citing high gas prices as a reason for people to be less willing to go on road trips or book flights.
Whatever happens, though, I think we can all agree that being able to sleep in a doughnut (or a potato) in the middle of the desert would be pretty cool.
In other news …
📊Stocks, oil and Bitcoin: MSCI’s global gauge of stocks around the world gained 0.31%, with the further loosening of China’s COVID rules and, in turn, the easing of supply chain woes helping with the uptick. But, US stocks had a volatile day, ending slightly lower on Monday, with the major averages beginning with losses as investors try and figure out whether stocks have bottomed out.
🛢Oil prices rose with the G7 sanctioning Russia more and planning to put a price cap on Russian oil. Brent Crude Futures rose 1.7% to US$115.09, and the US crude oil settled 1.8% higher at US$109.57.
💲Bitcoin fell to around US$20,811.
🏦China’s central bank support: China’s central bank said it would continue to adopt a supportive monetary policy as the world’s second-largest economy recovers from COVID flareups around the country and lockdowns.
👩⚖️Wise CEO tax trouble: UK payment platform Wise’s CEO and co-founder Kristo Kaarmann is being probed for missing a hefty tax bill of over £720,000 (US$883,224). If he’s found guilty, he may be forced to step down and stop working in the industry.
❓Xi’s Hong Kong visit in question: There is now speculation over Xi’s visit to Hong Kong as the city reports over 2,000 COVID cases. Some have pointed out that when Chinese state media reported his visit to the city five years ago, the statement was much more explicit compared to this year’s, which just wrote that Xi would “attend” the celebration of the city’s 25th anniversary of Chinese rule and the inaugural ceremony of incoming leader John Lee and his cabinet.
😢Russia strikes Ukraine: At least 13 people have been killed in a Russian missile strike at a crowded shopping center in Ukraine’s Kremenchuk. Zelenskiy has called it one of the “most brazen terrorist acts in European history” and has called for an emergency meeting with the UN. The US Secretary of State said that “the world is horrified.” Meanwhile, the Kremlin has said that Putin will attend the G20 meeting in Indonesia in November, and both Germany and the EU have said that they won’t rule out attending.
🚢Jordan port leak: 10 people died, and 251 were injured at Jordan’s Aqaba port after a tank with 25 tons of chlorine being exported overseas fell while being moved. The death toll is expected to rise, and residents are being told to shut windows and stay indoors.
👟Nike’s impressive performance: Nike impressed investors after beating Wall Street expectations with fourth-quarter revenues at US$12.23 billion compared to the US12.06 billion expected. This is despite the supply chain headaches, the lockdowns in China and the tough consumer market at the moment, especially in the US.
🙈Credit Suisse’s court ruling: Credit Suisse and one of its former employees have been found guilty of failing to stop a Bulgarian cocaine trafficking gang from laundering millions of euros between 2004 to 2008. It’s Switzerland’s first criminal trial of one of its major banks. Both have denied wrongdoing, and the company has said that it’ll appeal the decision.
🤑A potential Robinhood sale? Robinhood, the popular trading app that was the darling fintech startup during lockdowns in North America, has been struggling to keep up its revenue and active user growth post-COVID. With that, the company’s shares jumped on Monday after Bloomberg first reported that FTX, one of the world’s largest crypto exchanges, is considering acquiring them.
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