Coronavirus Briefing

Global: Confirmed cases: 25.2m, Recoveries: 16.6m, Deaths: 846k.

Canada: Confirmed cases: 128k, Recoveries: 113k, Deaths: 9k.

Health: 81 Quebec City students are in isolation after possible virus exposure; active cases are up 11% in Ontario.

Vaccines: Canada has signed deals to buy 76 million doses of Novavax's potential vaccine and 38 million doses of Johnson & Johnson's. Both vaccines are in Phase II trials.

Resources: Get up to speed on how Covid is most frequently transmitted and how you can avoid it.
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Superstar Power

Last week the NBA playoffs came to a sudden halt as first the Milwaukee Bucks — and then every other team in the league — decided to carry out what amounted to a wildcat strike following the police shooting of Jacob Blake.

Players eventually agreed to a restart of the season after NBA ownership agreed to a number of concrete actions, like turning arenas into voting centres for the November Presidential election.

But the action underscored something new: a few superstars are now able to exert outsized leverage in how sports operate, and the strike threat from these players is very real.

Management's response: Owners and league management have been sympathetic to players concerns, and have committed $300m over 10 years to fund economic opportunities for Black communities. But they also pushed hard for a continuation of the season, which some players resisted.

Zoom out: This pattern mirrors the rest of the economy which has increasingly become winner-take-all. One consequence of this is that the winners leverage is growing, and they are increasingly willing to use this influence for political goals. See: the walkout of engineers at Google over sexual harassment in 2018.

The losers: In a winner-take-all economy, the superstars dominate. But the flip side of this is the steady decline of influence of everyone else. 
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Tech's Battle Lines

An escalating battle between Apple and Facebook is turning into one of the biggest fights in tech.

Driving the news: Apple's iOS 14 will deal a major blow to Facebook's business as it makes ad tracking opt-in only. That means people will have to explicitly say they are okay with being tracked for Facebook (or other advertisers) to track them, and the number of people who do that will be somewhere close to... zero?

Facebook has said the changes may make its in-app ad network for mobile apps "so ineffective on iOS 14 that it may not make sense to offer it on iOS 14." Yikes!

Facebook's take: Zuckerberg has accused Apple of having a "unique stranglehold as a gatekeeper on what gets on phones" and of blocking innovation. Facebook has also supported Epic Games' fight against Apple's practice of taking 30% of revenue generated through in-app purchases.

Apple's take: The company has positioned itself as a champion of user privacy and frequently bashed Facebook over its tracking practices. Last year Apple shut down a Facebook app that paid users to allow the company to track everything they did on their phones. Apple also temporarily cut off Facebook's access to test versions of iOS.

The business fundamentals: Apple would like to protect its platform's power and continue raking in revenue from the app ecosystem while also breaking into Facebook's bread and butter of information and media. Facebook would like to dislodge Apple's power over the app ecosystem and prevent them from blocking their tracking, a key element of the company's value prop as an advertiser.
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Ringing The School Bell

Classes resumed yesterday for thousands of kids in Quebec's English language school board. Kids across the rest of the country will head back to class in the coming weeks. And universities are gearing up for the fall semester. 

But nobody really knows how long it can last and problems are already popping up: 

  • Two Quebec City schools have already had Covid cases and 81 kids are now in isolation.
  • Ontario's four teachers unions have filed complaints with the Labour Relations Board alleging that the Province's back to school plan is unsafe.
  • Parents groups in Alberta have formed out of fears about unsafe back to school plans.
  • Experts are warning that university and college residences could spawn new outbreaks.
What happened elsewhere: 
  • France: Initially re-opened schools in May, but several big outbreaks forced them to shut down again. Re-opened in June before going on summer break in July. 
  • Germany: Schools are fully re-opened, and so far there have been some new cases but no large outbreaks.
  • America: Some colleges have seen massive new outbreaks since opening in August. The University of Alabama has had 1,200 students test positive within the first two weeks.
  • Israel: After re-opening schools in May, Israel saw a massive surge in cases from the low double digits to thousands of new cases per day.
The Big Picture: Getting kids back in school is key to restarting the economy and allowing people to go to work rather than provide at-home childcare. Shutdown schools will act as a permanent drag on the economy.
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China Strikes Back

Not satisfied to allow the US government to do all the interfering in Tik-Tok, the Chinese state has stepped in to complicated the forced sale of the company to US corporations. As the deadline to sell the company approaches China has updated its export control rules to cover technology that can be interpreted to include TikTok's recommendation engine, meaning a license from China may be required to complete the sale.

China stepping into the fray may be because they see TikTok as a valuable resource that's important to the their national security, on the other hand it may be a tactic to help ByteDance, TikTok's parent company, gain back some leverage in the sale.

Bottom Line: If a deal gets done, whoever ends up with TikTok will be gaining a boatload of baggage along with its users and tech.

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The Rich Get Richer

The past week was one of the best weeks in history... if you were a billionaire. The world's 500 richest people added $209 billion to their net worth over the course of seven days.

Elon Musk crossed the $100 billion net worth threshold thanks to the ongoing rally of Tesla shares (NASDAQ:TSLA), and the growing value of SpaceX where he can unlock another $50 billion in bonuses if milestones are met. In 2020, the year everyone loves to hate, Musk has added $76.1 billion to his net worth.

Not to be outdone, Jeff Bezos has broke the $200 billion threshold last week, having added $84.6 billion in 2020

Zoom Out... The incredible accumulation of wealth by the world's wealthiest people is out of wack with the reality of most people who have seen stagnation for years and are now facing unprecedented hard times as a result of the pandemic. It's no surprise revolution is fomenting in the streets.

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Trump Targets Canadian Lobster

Forgotten in all the chaos south of the border is the ongoing and escalating trade war between Canada and the United States. In the past few weeks Trump slapped tariffs on Canadian aluminum imports, and Canada won at a WTO tribunal on the issue of softwood lumber. Now the Trump admin's next target is Canadian lobster.

Officially, it will be the US International Trade Commission who will investigate the possible negative effects of the Canada-Europe Trade Agreement (CETA) on American lobster exports.

Is it political? Probably. Lobster is the biggest export from the state of Maine, an industry valued at $486 million. Maine is a swing state which the President's campaign hopes to win in November but is trailing in the polls, as is Republican Senator Susan Collins. Trump campaigned in Maine in June and the Republican National Convention this month featured a lobster fisherman from the state.

What does it all mean? Well, according to Geoff Irvine, executive director of the Lobster Council of Canada, "we're not sure what it means."

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WestJet Gets Tough On Covid

WestJet is positioning itself to be the most covid sanitized airline with a series of measures designed to keep passengers safe and of course attract flyers back to the sky. The industry has seen a 43% drop in revenue as compared to the past year.

Zero Tolerance Masks Policy
The Federal Ministry of Transportation has already mandated masks be worn at all times on flights, while compliance has been generally high, enforcement against anti-maskers has been challenging and lackluster. Now WestJet is instituting a zero tolerance policy that could result in a year ban from the airline if a passenger doesn't mask up.

Covid Testing Pilot Project
In partnership with Vancouver International Airport, WestJet will begin testing patients on outbound flights for covid-19, and share these results with health authorities and academia. The tests aren't meant as a screening measure, but will be used to provide a clearer picture of how covid and other communicable diseases are being spread.

Playing Both Sides... While WestJet is stepping up its anti-covid measures, The National Airline Council, a trade organization representing WestJet, Air Canada and other competitors, is pressuring the government to loosen covid restrictions. They're calling for an end to the "blanket ban on foreign travelers" and a loosening of the mandatory two week quarantine period for people arriving in Canada.
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Peak Picks

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  • Boycott: The NBA postpones playoff games after Milwaukee Bucks boycott in response to the shooting of Jacob Blake
  • RNC: The Republican National Convention reaches Day 3 when Vice President Pence will take his turn
  • COVID Testing: New York City is pushing back against CDC guidance on COVID testing that would move away from recommending asymptomatic people get tested

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