Global Financial News Recap for July 23, 2019
Equifax Settlement Deal
Equifax will be required to pay $800 million dollars for a 2017 hack that left users personal data exposed. Hackers were able to steal sensitive data including social security numbers because Equifax failed to patch their systems despite receiving warnings. This payment is a record for the largest settlement ever and will require the company to take steps to prevent further such issues and also help those affected with protection from identity theft and fraud.
Breakdown of the $800 million; actually adds up to $795 million but who’s counting?
$300M towards a fund to compensate victims
$80M towards lawyer fees
$280M towards the Consumer Financial Protection Bureau for penalties
$10M towards the NY Department of Financial Services
$125M is to be made available if the fund is used up
Hong Kong Wrong
Hong Kong government officials are becoming under pressure after pro-democracy protestors were attacked by local gang members called the Triads. The issue lies in the police’s response to the matter. Despite the violence and injuries it took authorities extended amounts of time to respond to the issues. It appears as if they are letting it occur to curb the protests and instill fear in those protesting. Stephen Lo, Hong Kong’s police chief responded that their resources were stretched thin and that is the reason for the lack of response. Nevertheless, Hong Kong seems to be plummeting into despair with tensions rising and the people see the worst political crisis since their handover from the British. The reason for the tension is because of an extradition bill that would allow mainland China to try Hong Kong criminals in China. Despite the bill being suspended conflicts continue.
Unbeerable News for Asahi
After news broke that the Japanese brewer, Asahi, will be buying Carlton and United the stock plummeted. C and U is part of Anheuser-Busch’s InBev Australian operations and $2 Billion in value was erased due to concern regarding the company’s use of debt Asahi is desperately looking to raise cash since their IPO failed for their Asian business. In the past year alone they’ve spent $11 billion buying Pilsner Urquell (personal favorite), Peroni, and other parts of AB’s InBev Operations. They’ve done this despite being $10 billion in debt and interest growing, furthermore they are going to dilute their shares by 8.7%. The predominant issue with this deal was that analysts thought they overpaid, C and U’s business has large operating margins and stagnating profits, and of course, the large amount of debt used to make the purchases. Positives of Asahi’s recent acquisitions are that they are no longer dependent on Japan for revenues and are more diversified.
Kenya believe it?
As of late Kenya’s finance minister was arrested on corruption charges. Henry Rotich, is being charged for finagling a deai for the Arror and Kimwarer hydroelectric dam projects. He is being accused of negotiating a commercial facility to fund the project for $610 million while the project only required $465 million of public funds. Henry and 27 others will be charged and the case is being cited as a landmark due to the sophistication and stature of Rotich. Corruption is a large problem in the country and the president has vowed to tackle the issue. Despite the attention, prosecution is lacking and this could be a change in the tide.
Pacifism on the Pacific
Not only is the beer spilling in Tokyo, the constitution is constituting. The nation’s prime minister Shinzo Abe has a life long ambition to change the nation’s constitution. As it stands now, the nation is not allowed to have any military and they must vow to be passive. You might be wondering: why would a nation ever put that into their constitution? Well, they didn’t the US wrote their constitution following the 2nd world war. Despite Abe’s ambitions the rest of parliament and the country don’t find constitutional reform to be a pressing issue. Welp, hope Godzilla doesn’t show up.
Julius Baer? More like Julius Bull.
The Swiss Private bank, Julius Baer reported growth in its funds under management. Aided by a rebound in Global markets the bank now manages SFr 412 billion- this value is up 3% from the beginning of the year and 8% from their 2018 low. They have also added around SFr 6.2 Billion in new money. You might be thinking? Oh it’s all that drug money I saw on Narcos huh? Actually, the bank adheres to strict regulatory guidelines to mitigate criminal risk. For this reason the firm has employed “Project Atlas” - this project will essentially be returning funds to those deemed to not meet the gold standard and Baer expects an outflow of a few billion dollars. A few… not a big deal.
Hyundai? No, Hyundamnnnnn
Hyundai’s are looking pretty fresh these days, Jason Bateman and Shaq are driving them too, aren’t they? Well they are in the commercials and thats tricking someone. The firm believes their new SUVs and weaker local currency are going to bolster sales and further increase their profits. Their efforts in the US will hopefully counter balance the struggles they are seeing in China and labor disputes in their factories.
In Other News:
India is going to the moon, there are tensions in the Gulf with Iran, and Congo’s health minister quits over their response to Ebola. Ukraines got a new president: Volodymyr Zelensky, rail workers in the US are suffering, and Brexit is still a thing.