From China cracking down on corruption to a new Harry Potter series – Here's your April 5 news briefing

In late 2021, China kicked off an investigation to weed out corruption in the country's financial sector.

From China cracking down on corruption to a new Harry Potter series – Here's your April 5 news briefing
Chinese President Xi Jinping attends Russia - China talks at the Kremlin in Moscow, Russia March 21, 2023. Sputnik/Alexei Maishev/Kremlin via REUTERS

To start off, we're looking into:

China's anti-corruption campaign

The backstory: In late 2021, China kicked off an investigation to weed out corruption in the country's financial sector, worth around US$60 trillion. This is part of a broader, yearslong anti-graft campaign under President Xi Jinping. The same year, China's largest bad-debt manager, Huarong, faced a series of scandals and suffered massive losses. It was so bad that the company's ex-chairman was executed for bribery and other crimes.

More recently: Last week, the Chinese government launched an investigation into Liu Liange, the former chairman of the Bank of China.  This is a big deal because it's been years since one of China's "Big Four" state-owned banks has had a top executive under investigation. But it's not just the Bank of China that's being looked into. In fact, more than 30 state-owned companies, including five financial firms that have already been in the crosshairs, are currently being investigated.

The development: Some insiders spilled the beans that high-ranking officials from the China Banking and Insurance Regulatory Commission (CBIRC) and the CCDI recently held a closed-door meeting last Friday with execs from at least six state-owned banks. The message was clear: the crackdown on corruption in finance isn't slowing down anytime soon. The CBIRC and CCDI have emphasized that they're ramping up their efforts to stamp out corruption in the financial industry and have warned other bankers to learn from Liu's case.

EY sanctioned in Germany

Germany has sanctioned and fined auditor Ey over Wirecard snafu
The logo of Ernst & Young is seen in Zurich, Switzerland November 13, 2020. REUTERS/Arnd Wiegmann

The backstory: Wirecard was a German digital payments company that went bankrupt in 2020 because of a US$2 billion accounting fraud. The fraud went unnoticed by the company's supervisory board, financial watchdogs and its longtime auditor, EY, and was so massive that Wirecard ended up owing creditors almost US$4 billion.

More recently: The whole situation raised a lot of concerns among investors who rely on auditors to ensure that a company's financial statements are accurate.

The development: Germany's accounting watchdog APAS just handed down a hefty €500,000 (US$544,000) fine to EY, the auditor of Wirecard, and banned the firm from taking on new audits of public interest companies for two years. APAS also fined five individual auditors at the firm for amounts ranging from €23,000 (US$25,000) to €300,000 (US$326,000). EY can still continue working on its existing mandates, as the ban only applies to new audits. But this isn't a good look for the firm.

Hong Kong’s labor shortage

Hong Kong labor shortage
Participants attend an Asian investment conference held by Credit Suisse in Hong Kong, China March 21, 2023. REUTERS/Tyrone Siu

The backstory: Hong Kong began keeping records of its workforce back in 1985. Since 2019, the city’s seen a contraction in its workforce numbers. Experts have warned that this decline will probably continue.

Tens of thousands of workers left the city over the past four years following social unrest and strict pandemic curbs. The problem also comes from Hong Kong’s aging demographic. Hong Kong doesn’t have an official retirement age, but many companies encourage retirement between the ages of 60 and 65.

More recently: When John Lee became the Chief Executive of Hong Kong last year, he began pushing to attract workers into the city. His administration started a talent program with a two-year visa plan for certain workers and college graduates. The program has gotten the most interest from mainland China.

The development: On Monday, Hong Kong’s Census and Statistics Department released info on the city’s working population, reporting a 2.4% fall in numbers for 2022. The workforce dropped by about 94,100 people, down to 3,776,300 people. That’s the sharpest decrease the city has seen since it began keeping these records. On Tuesday, Lee said it might be necessary to start importing workers into the city to fill specific jobs if recruitment tactics continue to fail. If this happens, he also promised to protect local workers, with many unions opposing this move.

To end, we'll look into:

How healthy is tofu, really?

Is tofu good for you? Short answer: yes. But let’s get into it.

Soy-based foods have gotten a bad rep recently because they have higher levels of isoflavones, which are plant-based compounds similar to the estrogen hormone. Because of this, some people are afraid that higher isoflavone levels increase the risk of cancer, could negatively affect fertility or could give men more feminine characteristics (have you heard the newer term soyboy to demean a man?).

"The thought that soy products like tofu can lead to cancer has been debunked, and soy may even help prevent cancers like prostate and breast," says nutrition writer Brittany Lubeck, M.S., R.D. She also explains that many of the negative results of soy products come from tests on animals and other non-human subjects. "Human studies on soy tend to show positive results."

It turns out that soy-based foods are totally safe to consume on a regular basis. Things like tofu are actually really great for you! While isoflavones do kind act like estrogen, they’re also shown to have anticancer, anti-inflammatory and antioxidant benefits. And it’s one of the few sources of protein that contains all nine essential amino acids your body needs.

“It’s almost a no-brainer that people should choose tofu and other plant-based proteins instead of animal-source proteins,” says Dr. Qi Sun, an associate professor of nutrition and epidemiology at the Harvard T.H. Chan School of Public Health.

Like many vegetables and plant-based foods, tofu also contains anti-nutrients. That may seem like a scary word, but an anti-nutrient is just a compound that lowers your body’s ability to absorb nutrients from food. Tofu contains two anti-nutrients: phytates and Trypsin inhibitors. These shouldn’t be a concern for anyone with a varied, nutrient-rich diet, but if you have a very restrictive or nutrient-poor diet, then these anti-nutrients can make it a little harder to meet your nutrition needs. Strangely enough, phytates can also be good for you as a natural iron regulator.

So, eat up tofu lovers!

In other news ...

📉Stocks: MSCI’s global gauge of stocks is down 0.24% at 2796.78 at the time of writing.

  • Dow Jones dropped 0.59% to 33,402.38.
  • Nasdaq Composite declined 0.52% to 12,126.33.
  • S&P 500 slipped 0.58% to 4,100.60.
  • Hang Seng Index lost 0.66% to 20,274.59.

🧠Some quick factors to bear in mind:

  • US stocks took a hit on Tuesday, ending a four-day winning streak, as data showed a cooling labor market in the US. This also led to the US dollar hitting a two-month low and Treasury yields easing up a bit.
  • The latest job openings report showed less than 10 million available positions in February, the first time in almost two years, indicating job growth might be slowing down a bit.
  • Big banks like Wells Fargo and Citigroup saw their stock prices dip around 2%, while regional lenders like First Republic Bank and Zions Bancorporation lost about 5%.
  • Friday's jobs report is expected to show that employers added around 250,000 workers in March, with a predicted unemployment rate of 3.6% and rising average hourly earnings.
  • Hong Kong stocks dipped on Tuesday due to concerns about inflation from the spike in oil prices and how it might impact Fed's interest rate decisions.
  • The Hong Kong Monetary Authority intervened for the third time this year, buying HK$7.1 billion (US$905 million) to defend the peg to the greenback.

👄Some comments and chatter:

  • “Investors should continue to be vigilant for signs of bank stress, and we expect market participants to react disproportionately to negative economic news,” said Gennadiy Goldberg, senior US rates strategist at TD Securities.
  • “It was just a matter of when, not if, we were going to see evidence of lessened job demand. And at some point, the pace of firings will pick up as companies try to defend profit margins and respond to the slowing economic backdrop. I just don’t see the Fed hiking rates in May or any time thereafter in this cycle,” said Peter Boockvar, author of the Boock Report, referring to the latest job opening report.

🛢Oil: Prices didn't move much. Investors were trying to balance the news about OPEC+ cutting production with the US and China struggling economically, which could affect oil demand. With this, US crude rose 0.4% to US$80.71, and Brent settled at US$84.94 per barrel.

👛Bitcoin: At the time of writing, Bitcoin is up 1.59% at US$28,260.30.

🏔Deadly avalanche in India: On Tuesday, an avalanche hit India's Himalayan state of Sikkim near a pass to Tibet. It killed seven tourists, and the search for bodies was called off that night. At least 20 people were rescued alive, and eight survivors are in critical condition.

🚅Train accident in the Netherlands: On Tuesday, a passenger train derailed in the Netherlands after hitting construction equipment on the track. There were 30 people who were injured, and one person died.

📄Finland joins NATO: As expected, Finland joined NATO on Tuesday, which is a blow to Russia in its war on Ukraine. Because Finland has a border with Russia, now NATO has basically doubled its Russian border length. Now, Russia is saying it might be forced to take "counter-measures."

🤝New US military access in the Philippines: Over the past few months, ​​the US has been trying to expand its Indo-Pacific presence as China is also heavily involved in the region. On Monday, the Philippines released info about four new military bases that the US will have access to soon, going with an expanded defense agreement between the two countries. Three of the bases are on the main island of Luzon (which is close to Taiwan), and the third is in the Palawan province in the South China Sea.

💬EU Prez chats with Zelenskiy: European Commission President Ursula von der Leyenhas plans to visit China later this week. On Tuesday, she spoke to Ukraine's President Volodymyr Zelenskiy ahead of the trip, saying that Ukraine would be a top topic when she meets with Chinese officials.

✈Macron heads to China: French President Emmanuel Macron is headed on a three-day state visit to China. He's expected to call on China to work on peace efforts between Russia and Ukraine and to push for climate action initiatives plus talk trade.

😮Fukushima reactor worries: About 12 years ago, a devastating earthquake and tsunami hit Japan, wrecking the Fukushima nuclear power plant. For the first time since then, we're seeing images from the underwater plant, taken by a robotic probe sent into a supporting structure near the core of one of the melted reactors. These photos show exposed steel bars in the main supporting structure and parts of its external concrete wall missing, causing concern about what will happen if there's another major disaster.

👩‍⚖️Trump arraigned: Former US president Donald Trump appeared in New York state court for an arraignment on Tuesday. He pleaded not guilty to 34 felony charges. He's previously called the indictment a politically-motivated "witch hunt."

📱Australia announces TikTok ban: It seems like one Western country after another is banning TikTok on government devices. Australia is the latest to do so, citing security concerns. The ban was announced on Tuesday.

😷Marburg breakout in Africa: Marburg virus is similar to Ebola and can kill up to 90% of the people it infects. There are two outbreaks of the virus currently affecting Africa, one in Tanzania and the other in Equatorial Guinea, that are causing worry. The WHO is working on a response to help control the spread.

💸Virgin Orbit bankruptcy: Virgin Orbit Holdings was founded by billionaire Richard Branson to launch satellites, but it's been having trouble finding funding after a failed launch in January. On Tuesday, the company filed for Chapter 11 bankruptcy.

🎮Saudi Arabia nerds out: In another move to diversify the nation's portfolio, Saudi Arabia plans to spend US$38 billion to develop as a video gaming hub. Savvy Gaming Group, which is leading the new project, plans to increase stakes in companies like Nintendo and nurture a thriving esports ecosystem in the nation. The next step is focusing on game publishing and development, according to Savvy's CEO.

👩Jacinda Ardern back: Former New Zealand PM resigned earlier this year, citing burnout in her role. Now, she's taking over as an unpaid special envoy for the Christchurch Call, a group she co-founded to combat online extremism. She's also been put on the board of the Earthshot Prize, an environmental prize set up by Prince William.

🐘Are elephants domesticating themselves? A study published on Monday shows that elephants might have domesticated themselves. That would make them the only non-primate to have done so. In the study, researchers found 19 cognitive, behavioral and physiological traits shared by humans, bonobos and elephants, but not other species.

👩‍⚖️Fraud over JPMorgan deal: In 2021, JPMorgan Chase acquired the financial aid planning platform Frank after its founder, Charlie Javice, made the bank believe that Frank had over four million users when it really had less than 300,000. Javice is now being charged with defrauding JPMorgan of US$175 million.

💄Beauty giant buyout: L'Oreal has decided to buy Australian luxury brand Aesop to boost its market share in high-end cosmetics and expand internationally, especially within China. Aesop debuted in China with two retail stores at the end of last year and has been doing well there.

🍿More Potter!: HBO is in talks with Warner Bros. and author JK Rowling to develop a TV series based on the beloved Harry Potter franchise. Potterheads are abuzz, as the book series is the most popular ever, with over 600 million copies sold. The films based on the series didn't do too shabby, either, raking in almost US$8 billion.

🎬New Barbie movie updates: The highly anticipated "Barbie" movie directed by Greta Gerwig and starring Margot Robbie is coming out this summer. On Tuesday, a new teaser trailer was released, and so were some groovy new character posters featuring tons of exciting Hollywood talent!

Written and put together by Joey Fung, Vanessa Wolosz, Shebby Farooq and Christine Dulion