From the EU cutting off Hungary’s funds to Yeezy’s drama with a 90s fashion relic – Here’s your September 19 news briefing
To start off, we’re looking into:
The EU moves to cut funding to Hungary
Since Hungary’s 2004 membership in the EU, things haven’t always gone smoothly. Hungary’s prime minister, Viktor Orban, has had arguments with the EU over Hungary’s civil rights policies and independence of the country’s judicial, media and academic sectors. Now, another feud has begun as Hungary is accused of corruption; the EU says it lacks effective anti-graft safeguards. In the past, the European Commission has blocked 6 billion euros (US$6 billion) for Hungary from its COVID stimulus package over the same issue.
Later this week, the commission will probably suggest suspending 7.5 billion euros (US$7.5 billion) from being sent to Hungary from its over 1.1 trillion euro (US$1.1 trillion) budget for 2021-27. This would be its first move under a new sanction agreement known as “cash for democracy." EU countries would have three months to decide on the proposal. Yesterday, though, Hungary pledged to meet certain commitments to unlock that funding. For instance, it’s ready to create a new anti-graft agency. We’ll see if these changes help Hungary’s case.
Terra founder on the lam – or is he?
Early this year, Terraform Labs completely collapsed, with the cryptocurrency ecosystem losing US$40 billion worth of investors’ money, crumbling the crypto coins Terra and Luna. This collapse contributed to a loss of faith in digital assets – especially the stability of so-called “stablecoins." Then, five South Korean investors accused Terra’s founder, Do Kwon, of fraud. Currently, he’s being investigated by South Korea and the US SEC.
Last Wednesday, South Korea issued an arrest warrant for Kwon. But Kwon is … nowhere to be found. Although Singapore police say he’s no longer in the country, Kwon responded that he’s “not on the run." But, Korean prosecutors don’t seem to be buying that, saying he’s “obviously on the run" and intended to flee the country before Luna’s collapse. According to them, he’s not cooperating with probes, and his attorney said he has no intention to show up for questioning. On top of his arrest, Kwon could be seeing his employment permit renewal, which expires in December, at risk in Singapore.
It’s coach or nothing for many business travelers
During the pandemic, airline tickets were super cheap. One reason was that everyone wasn’t taking their tour-de-COVID to different parts of the world, opting to stay home instead. (Good job, by the way.) Another is that gas prices got super cheap, meaning jet fuel was super cheap, and airlines passed on some of those savings to the consumer.
Well, now that people around the world are a little more willing to hop in a confined space with 250 of their closest friends for eight hours, airlines are looking to make up for the lost revenue they had during earlier parts of the pandemic. So, ticket prices are going up. For example, a business-class flight from Australia to New York will now run more than US$20,000 – about double what you would have paid pre-pandemic.
As a result, companies say that their employees will either have to fly coach or not because of the high cost. Still, this might end up being a nonissue for some since what used to require a lengthy international trip has, in many cases, turned into a remote meeting.
To end, we’ll look into:
Ye scraps his Gap deal
A couple of years ago, 24-time Grammy winner Kanye West (aka “Ye”) made a deal with Gap to put his brand Yeezy on its shelves. The first round of the products the company rolled out was a puffy blue jacket that sold out in just a few hours. And in addition to the typical royalties expected for this kind of thing, Yeezy would also get some 8.5 million shares of stock as Gap met certain targets.
But now Ye is scrapping the deal. He said Thursday that he terminated the contract with Gap because it hadn’t been putting products in stores the way it said it would be. On top of that, Ye said that he felt shut out of the creative process (which, in fairness, is probably how Taylor Swift felt about her acceptance speech at the VMAs in 2009 after being so rudely interrupted by the self-proclaimed “genius” … but we digress). After the announcement, shares of Gap fell around 4%.
“Obviously there’s always struggles and back-and-forth when you’re trying to build something new and integrate teams,” said Ye on CNBC’s “Closing Bell,” (where he wore sunglasses that look like a 1965 depiction of 2022).
“Everyone knows that I’m the leader, I’m the king. A king can’t live in someone else’s castle. A king has to make his own castle.” (King Charles III respectfully disagrees, but again, we digress.)
This whole shift will be expensive, so according to Ye’s lawyer, Nicholas Gravante, the Yeezy company will be opening its own retail outlets to “make up for lost time”.
“While we share a vision of bringing high-quality, trend-forward, utilitarian design to all people through unique omni experiences with Yeezy Gap, how we work together to deliver this vision is not aligned,” said Gap CEO Mark Breitbard in a memo to employees. Now, Gap is going to essentially flush out the rest of the products in the pipeline and call it a day.
“I made the companies money. The companies made me money. We created ideas that will change apparel forever. Like the round jacket, the foam runner, the slides that have changed the shoe industry. Now it’s time for Ye to make the new industry. No more companies standing in between me and the audience,” Ye told Bloomberg.
In other news …
🌀Typhoon Nanmadol heads for Japan: Making landfall in the southwestern Kyushu region of Japan last night, Typhoon Nanmadol is wreaking havoc. More than 7 million people have been urged to seek refuge and evacuate the area. This storm is already very dangerous, with 150 miles-per-hour winds and dumping 500 millimeters of rain already in less than a day.
🛢German seizure of oil refineries illegal?: Russian oil company Rosneft PJSC has accused Germany of illegally seizing its units. Germany took control of Rosneft’s assets, including three oil refineries, as the country attempts to control its energy sector and become more independent from Russia. Now, Rosneft is saying this move is an expropriation of equity assets, and it’s considering legal actions.
🤝World leaders to meet at UN General Assembly: For the first time in two years, the UN General Assembly will be convening in person in New York City. The opening of the 77th session will take place this week, opening Monday. Leaders are expected to discuss several issues, including the war in Ukraine, inflation, economic instability and climate change.
👩Lazard names woman as Saudi chair: The financial advisory firm Lazard has hired Sarah Al-Suhaimi to chair its business in the Middle East and North Africa. Her appointment also shows how women are taking on more prominent roles as the country gradually loosens restrictions on women, like allowing them to drive cars.
👑Queen Elizabeth’s funeral: Queen Elizabeth II’s funeral will be held later today in Westminster Abbey. Thousands of people lined up to view her body over the past few days.
😷Hong Kong to end quarantine?: Hong Kong may announce an end to hotel quarantine for inbound travelers as soon as this week. It may move to just requiring travelers to self-monitor for seven days instead. The mainland has also lifted the lockdown in Chengdu beginning Monday, hopefully helping stifled supply chains affected by the city’s restrictions.
🤑Bezos gets beat out: Jeff Bezos is no longer the second-richest man in the world. He’s been replaced by Gautam Adani, the Indian tycoon and the richest man in Asia. Adani is now just behind Elon Musk.
🎉Cheetahs return to India: 70 years ago, cheetahs went extinct from India and are now pretty much only found in Africa. But Namibia gave eight cheetahs to India as part of a reintroduction project. They’ve been released in the country’s Kuno National Park, and we hope to see them reclaim their home.
Written and put together by Jake Shropshire, Vanessa Wolosz, Christine Dulion and Krystal Lai