By Ye Xie, Bloomberg Markets Live reporter and analyst

Until Tuesday, the People’s Bank of China had been fighting against yuan depreciation via strong fixings. However, the defense crumbled a bit as soon as the Communist Party Congress was over. The fixing on Tuesday wasn’t as strong as it was in previous sessions, even as the yuan fell to the lowest since 2007.

Is that a fluke or has the PBOC showed more tolerance for yuan depreciation? Wednesday’s fixing will tell us if the PBOC has indeed decided to “lie flat.”

In the days before and during the Party Congress, the central bank effectively kept the fixing unchanged around 7.1 per dollar, putting a temporary floor under the currency. The fixing surpassed analysts survey by Bloomberg by a record last Thursday, suggesting a strong willingness to defend the yuan.

But the depreciation pressure didn’t go away. As a result, traders pushed the yuan almost to the weaker end of its 2% limit relative to the fixing Monday. On Tuesday, the PBOC finally loosened its grip, allowing the reference rate to fall by the most since June. It was still about 5 bps stronger than analysts surveyed, but the deviation was the smallest in a week. As if on cue, the onshore yuan weakened to 7.31 per dollar, the lowest since December 2007, and fell to the lowest against the basket in more than a year. 

That marked a change in the PBOC’s strategy, according to Jens Nordvig, founder of Exante Data. It used to be that the PBOC forced the markets to converge to its fixing. Now, the markets are leading the central bank in dictating the currency’s moves. “The fact that they have been trying to create a big gap between fixing and spot, and then have to move to spot, rather than the other way around, is the key,” said Nordvig.  “We are breaking big levels in the process.”

Why such a shift? The PBOC is “more out of bullets than in the past,” said Nordvig. The central bank doesn’t want to burn through its foreign reserves, and it cannot raise interest rates to reduce the depreciation pressure. In addition, the authorities have already closed a lot of capital-account holes. In other words, the PBOC is running out of “easy” ways to control the yuan, he said.

It’s not that the PBOC has completely stopped resisting the depreciation pressure. Right before the PBOC released its fixing on Tuesday, the central bank tweaked a policy to make it easier for companies to seek funding offshore, a move that could potentially add more dollar supply to the onshore market.

But these are only token measures of support for the currency. Brad Setser,  a senior fellow at the Council on Foreign Relations, tweeted: “Until China proves otherwise, it is effectively engaged in a controlled depreciation.”

[ZH: And while all these after-the-fact takes are great, all of this is what we predicted 7 months before it happened]

Elon Musk’s Neuralink’s “show & tell” event was initially scheduled for Halloween day but has been pushed back until the end of November for unknown reasons. 

Musk tweeted Sunday, “Neuralink show & tell now on Nov 30.”

Neuralink show & tell now on Nov 30

— Elon Musk (@elonmusk) October 23, 2022

The delay led some on Twitter to say, “you are a stupid loser and your bad products are going to fail,” while others were excited about possible new developments of Neuralink’s transhumanistic technology. 

Neuralink, based out of San Francisco, aims to “implant wireless brain-computer interfaces that include thousands of electrodes in the most complex human organ to help cure neurological conditions like Alzheimer’s, dementia, and spinal cord injuries and ultimately fuse humankind with artificial intelligence.” 

In 2020 and 2021, the brain-machine interface startup held demonstrations of the chip implant at work in pigs and monkeys, but the SpaceX and Tesla founder has voiced concerns about the slow rate of progress. 

The billionaire said he is “cautiously optimistic” the chip implant can restore full-body functionality for tetraplegics and quadriplegics and has said human testing could be next. Neuralink’s efforts have yet to receive FDA approval.

Musk, of course, is neither a doctor nor a scientist… and actual scientists at MIT recently wrote in the MIT Technology Review: 

“Elon Musk’s livestreamed brain implant event made promises that will be hard to keep.” 

“None of these advances are close at hand, and some are unlikely to ever come about,” the article stated, calling most of the company’s medical claims “highly speculative.”

It also points out that – just like with solar panels, electric cars, reusable rockets, and busses on skates in tunnels – that Musk isn’t the first entrant into the space: 

“Researchers began placing probes in the brains of paralyzed people in the late 1990s in order to show that signals could let them move robot arms or computer cursors. And mice with visual implants really can perceive infrared rays.”

And let’s hope Musk’s upcoming Neuralink “show & tell” event isn’t “next level cringe-worthy” and a “complete and utter scam” like some said when he revealed the Optimus robot earlier this month. 

Authored by Eva Fu via The Epoch Times (emphasis ours),

The Republicans could see large gains in both chambers of Congress in November, according to Epoch Times contributor and former House Speaker Newt Gingrich.

“I would say we’ll be between plus three and plus seven … in the Senate; and we’ll be between plus 20 and plus 50 in the House, with the most likely number being plus 44,” Gingrich told The Epoch Times.

The GOP needs to flip five seats to win back House control. In the evenly-divided Senate, Republicans need to win one more seat to claim the majority.

With the November election day fast approaching, Democratic optimism appears to be fading as GOP candidates close in on key races across the country.

In New Hampshire, Republican challenger Don Bolduc has narrowed the gap between him and Democratic Sen. Maggie Hassan down to 2 points, according to an Oct. 20 poll by GOP pollster Fabrezio, Lee and Associates, well within the 4 percent margin of error. The poll, which was commissioned by Bolduc’s campaign, placed Hassan at 49 percent to Buldoc’s 47 percent.

In Arizona, the Trump-backed Republican Senate candidate Blake Masters is gaining ground after earlier stumbles. Polling data aggregator RealClearPolitics predicts the state to be a tossup, and gives the Democrat incumbent only a 2.5-point lead.

In Pennsylvania, Lt. Gov. John Fetterman’s double-digit edge has evaporated in recent weeks. A recent AARP Pennsylvania poll conducted by Fabrizio Ward and Impact Research showed Fetterman with a 48 percent to 46 percent lead, which is within the margin of error of 4.4 percentage points.

In Georgia, Democratic Sen. Raphael Warnock’s lead over the Republican nominee Herschel Walker is sliding too. A recent Landmark Communication poll had the two tied at 46 percent, while an InsiderAdvantage survey showed Warnock only 2 points ahead, within the margin of error of 4.2 percent.

“Almost everywhere in the country, races are showing the Republicans tightening up,” said Gingrich. And according to him, Democrats have only themselves to blame.

Key Voter Concerns

Crime, inflation, border security, and “woke policies,” he said, all “coming together” against Democrats’ favor.

“When you have sort of insane left-wing Democrats who believe that you don’t need prisons and that things can be dealt with by just being nice to murderers, I think the average person just thinks this is crazy,” he said, pointing to the crime concerns in New York as an example.

For gubernatorial candidate Rep. Lee Zeldin (R-N.Y.), who has made crime a campaign focus, the issue hit close to home on Oct. 9 when a shooting wounded two minors outside of his front porch with Zeldin’s two 16-year-old daughters inside the house. Zeldin, who was out campaigning at the time, said that one bullet landed 30 feet away from the kitchen table where his two teenage daughters were doing homework.

With near-daily press conferences to highlight the city’s crime crisis and his opponent’s failure to address it, Zeldin’s been closing in on Democrat Gov. Kathy Hochul in the gubernatorial contest, with the gap tightening to low single digits, positioning him for a potential upset victory in a deep blue state.

Hochul, facing political pressure, on Oct. 22 announced a plan with New York City Mayor Eric Adams to hire another 1,200 officers to address transit crime.

Inflation, crime, and immigration are Republicans’ key campaign issues. In a handful of recent polls, voters appear to find them their biggest concerns at the moment.

House Speaker Nancy Pelosi (D-Calif.) on Oct. 18 claimed that a New York Times/Siena poll showing that the economy and inflation ranked as voters’ top two concerns was an “outlier,” and that abortion is on top of voters’ minds.

“I can tell you that women’s concerns about their freedom are very, very much still very significant in terms of how they will vote,” she told MSNBC. “It’s a matter of who turns out to vote,” she said, adding that she feels “pretty good” about her party’s chances.

Abortion Issue Not Paying Off for Democrats

The abortion issue, however, is unlikely to help the Democrats as much as Pelosi and other Democratics may think, according to Gingrich.

“Republicans are actually winning the argument, because it’s a question of who’s the more extreme,” he said.

Read more here…

One of the most anticipated events leading up to Election Day on Nov. 8 will unfold tonight when Democrat John Fetterman and Republican Mehmet Oz take the stage in Harrisburg, Pennsylvania, for their only scheduled debate.

The 60-minute debate will be televised live and begin at 8 p.m. ET.

As Jeff Louderbeck write at The Epoch Times, the candidates are vying to replace retiring Pennsylvania Republican Sen. Pat Toomey in a race that will help determine which party has control of the chamber in 2023.

Fetterman suffered a severe stroke days before the May primary and cast his vote from a hospital bed. Since then, he has made limited public appearances and conducted a handful of media interviews.

Fetterman made his first public appearance since his stroke on Aug. 12. Oz immediately challenged him to appear on the debate stage. Oz asked for five debates from Sept. 6 to Oct. 5. Fetterman eventually agreed to one on Oct. 25, two weeks before election day. Early voting started in Pennsylvania on Sept. 19.

During the debate in Harrisburg, Fetterman is expected to use closed captioning, which he has relied on in interviews and public appearances as he continued to recover.

According to recent polls, the race is tightly contested and within the margin of error. The high-stakes debate could be a decisive moment in a contentious campaign.

“I have not spoken to a Democrat in Pennsylvania or in Washington, D.C., who is not concerned about the debate,” a senior Democrat strategist from Pennsylvania told Reuters.

A Fetterman campaign spokesperson also expressed apprehension about the forum.

“Even before the stroke, John was not a great debater. Meanwhile, Oz is a showman who spent years in front of a camera, so we know what we are up against,” the Fetterman spokesperson said.

Oz will likely discuss his plans for fighting crime and talk about Fetterman’s progressive record on criminal justice reform.  On Oct. 24, Oz announced a six-point plan to fight crime. The highlights, according to a press release, include stopping drug crimes, smart sentencing reform, increasing resources for safer streets, prosecuting crime, relief for victims and users, and reducing crime in prisons.

As Pennsylvania’s lieutenant governor, Fetterman heads the Board of Pardons.

Fetterman has bragged that he “conferred more pardons in Pennsylvania than any administration in history” while also saying that one-third of the prisoners in Pennsylvania state prisons could be released and “we wouldn’t be any less safe.”

Last week, Jahmir Harris surrendered to police in connection to a Philadelphia shooting that killed 50-year-old Charles Gossett after security footage showed he was the alleged getaway driver.

Harris served eight years in prison for a 2012 first-degree murder before he was exonerated and released last year by Philadelphia’s “Conviction Integrity Unit,” which is led by progressive district attorney Larry Krasner.

Fetterman has praised the unit for being “crucial” and “truly groundbreaking.”

In 2021, Fetterman endorsed Krasner, who is facing impeachment as a Pennsylvania House investigates his prosecutorial policies in a city afflicted with rampant crime.

Fetterman has declined to comment on Krasner’s current issues. In May 2021, he tweeted:

“[Krasner’s] unwavering commitment to systemic criminal justice reform was resoundingly affirmed with a true mandate. His efforts have literally saved the innocent from dying in prison.

“His Conviction Integrity Unit model should be mandatory in all of PA’s 67 counties,” Fetterman added.

Fetterman is endorsed by Brand New Congress and Reclaim Philadelphia. Both groups have called for defunding the police.

Recently, he told reporters that, “I think we need to be having a better relationship with the police. And making sure that the police feel they feel supported by the DA.”

In an interview with Fox & Friends last weekend, Oz addressed the Harris case and hinted at what would be discussed in the debate.

“If you walk through the streets of Philadelphia and most of the large cities in Pennsylvania, it’s the same story,” Oz said. “People feel like the folks in charge value the criminals more than the innocent. The families are in pain. No one seems to care.

“The fact that Jamir Harris could have been released from prison by this Conviction Integrity Unit, which sounds Orwellian, is shocking to me, and it is to everybody else. But only days ago, John Fetterman praised it, and talked about how it was groundbreaking. It was a beacon of light,” Oz added.

“He actually said we should have similar mandatory programs in all the counties of Pennsylvania. The parole board that he serves. He wanted to have it do exactly what this conviction integrity unit was doing, which is go back, find people who are guilty, and get them out in the streets.”

Fetterman’s health is another topic likely to be addressed in the forum.

He has used a closed captioning system during interviews with reporters. His campaign says it helps compensate for auditory processing challenges. He will use the system on stage during the debate.

Under frequent scrutiny from Oz and multiple media outlets regarding questions about his health, Fetterman released a letter on Oct. 19 from a doctor who wrote that he “is recovering well from his stroke” and “has no work restrictions and can work full duty in public office.”

The author—Dr. Clifford Chen—has donated to Fetterman’s campaign at least four times, according to Federal Elections Commission records.

In September, the Pittsburgh Post-Gazette editorial board called on Fetterman and Oz to release their medical records in September. Oz agreed, and the results indicated that he was in “excellent health,” according to his doctor.

Fetterman had repeatedly refused to reveal medical information until the report from Chen.

The letter was released days after Fetterman stumbled over his words and used a closed-captioning monitor to read questions in an interview with NBC News reporter Dasha Burns that aired on Oct. 11.

“I hear and understand everything in terms of words, on paper, and understand what I hear, but when we are talking about very specific and heavy things like this, we’re going to need captioning. I need captioning,” Fetterman told reporters earlier this month.

How Oz addresses Fetterman’s health issues is among the many anticipated parts of the debate. Oz and his campaign have drawn criticism over “mocking” Fetterman’s health conditions.

After Chen’s letter was published, Oz’s campaign released a statement saying it was “good news that John Fetterman’s doctor gave him a clean bill of health.”

“The bad news is that John Fetterman still supports releasing convicted murderers out on the streets and has zero explanation for why he didn’t pay his taxes 67 times,” an Oz campaign spokesperson said. “And now that he apparently is healthy, he can debate for 90 minutes, start taking live questions from voters and reporters, and do a second debate now too.”

Political pundits also believe that Oz will link Fetterman to rising inflation and gas prices, and the overall cost of living increase.

Fetterman’s campaign has focused on bolstering the working class, battling corporate greed, and supporting abortion rights.

Fetterman has attacked Oz for his backing of Sen. Lindsey Graham’s (R-S.C.) proposed nationwide 15-week abortion ban.

On Oct. 24, Fetterman’s campaign released a statement referencing a Rolling Stone article that claims former president Donald Trump is encouraging Pennsylvania lawmakers to repeal a 2019 no-excuse mail-in voting law. The story also alleged that Trump is setting the groundwork to challenge the results of the Pennsylvania Senate race if Oz loses.

“It’s clear that Donald Trump, Dr. Oz, and the GOP will do whatever it takes to try and steal this race on Election Night. Trump has already said he ‘needs’ people like Oz in office to challenge the 2024 election,” Fetterman spokesperson Joe Calvello said in a statement.

“Trump is trying to steal the 2022 election for Oz so that Trump can steal the 2024 election for himself.”

Pennsylvania is considered one of the Democrats’ top chances to at least maintain control of the Senate.

The current makeup is 50-50 with Vice President Kamala Harris having the tie-breaking vote.

A victory in Pennsylvania could offset Democratic party defeats in Arizona, Georgia, and Nevada.

South Korean President Yoon Suk Yeol has briefed his parliament on what he described as imminent plans of North Korea to conduct its first nuclear test in five years.

“We assess that it has already completed preparations for a seventh nuclear test,” President Yoon Suk-yeol said Tuesday. He reminded lawmakers that Kim Jong-un has already justified the preemptive use of nuclear weapons, making a test if carried through a severe threat to Seoul’s as well as the broader region’s security. 

White House national security official John Kirby has also lately reiterated the US intelligence belief that the north “could conduct a nuclear test at any time.”

According to Bloomberg, “The US, South Korea and Japan have all pledged stern and united punishment for a nuclear test, which would be in violation of United Nations Security Council resolutions.” Likely this would come in the form of more sanctions – though we wonder what is left in North Korea to sanction at this point, in terms of making actual impact on the regime.

In early August, US Secretary of State Antony Blinken began warning that such a test remains imminent. He said at the time in an address to the 10th NPT Review Conference (or Treaty on the Non-Proliferation of Nuclear Weapons) at UN headquarters in New York that “The DPRK continues to expand its unlawful nuclear program and continues its ongoing provocations against the region.”

This week, Foreign Affairs has described Washington’s broader alarm over what a nuclear test could mean for the region: nothing less than a new regional atomic arms race…

“The fact that North Korea has had nuclear weapons for so long (its first nuclear test was in 2006) has inured analysts and policymakers to the gravity of the threat,” the publication observed. “The North can now credibly threaten the continental United States with nuclear weapons. But the threat goes beyond U.S. domestic security: North Korea’s development of weapons of mass destruction (WMD) could spark an arms race in northeast Asia.”

“Kim’s saber rattling has increased public support in South Korea for that country to acquire its own nuclear capability, something that previously would have been regarded as implausible. A South Korean decision to go nuclear would prod China and Japan to augment their own weapon arsenals,” Foreign Affairs continued. With no easy solutions, the Biden administration has failed to articulate a policy response to these developments. It needs to get more engaged to prevent another crisis from spinning out of control.”

Pyongyang and Washington haven’t had any real communications or honest dialogue since the last two years of the Trump administration, with the Biden White House appearing to not so much as attempt open lines of communication. Instead, there’s been a build-up of joint US-S.Korea military exercises off the peninsula.

Authored by J.M. Phelps via The Epoch Times (emphasis ours),

Whistleblower service members are speaking out on behalf of thousands of service members whose careers have been jeopardized for objecting to Secretary of Defense Lloyd Austin’s 2021 military COVID-19 vaccine mandate. They’ve expressed concern over the vaccine mandate’s legality, as well as its health effects.

Alongside three members of the Armed Forces, attorney and former Marine Corps Capt. Dale Saran participated in a live-streamed military whistleblowers press conference on Oct. 18 to highlight concerns about the military vaccine mandate. The video has garnered more than 40,000 views, to date.

Saran once defended service members involved in a fight against the Pentagon’s mandatory anthrax vaccination program. He is also challenging the Pentagon’s vaccine mandate in a class-action lawsuit. He noted in the press conference the current case bears striking similarities to the legal battle against the anthrax vaccine program almost 20 years ago.

Saran said that “at the heart of most of the legal claims” against today’s military COVID-19 vaccine mandate is the fact that “there is no licensed vaccine” available to service members.

The attorney and many service members argue that the Pentagon’s vaccine mandate, which covers “COVID-19 vaccines that receive full licensure from the Food and Drug Administration (FDA), in accordance with FDA-approved labeling and guidance,” does not apply to any vaccines issued under emergency use authorization (EUA), such as the Pfizer-BioNTech vaccine.

They say that the military has mainly offered service members EUA Pfizer-BioNTech vaccine, rather than the FDA-approved Cominarty vaccine, and thus cannot compel personnel to take them. They also argue that a Pentagon policy that says the Cominarty and EUA Pfizer-BioNTech vaccines are interchangeable is illegal.

Saran said the continued push to vaccinate service members is “done just to break them.”

At the press conference, Air Force First Lieutenant John Bowes, an F-16 student pilot, pointed out various reports that have been sent to congress concerning the military vaccine mandate’s effect on military readiness and the health of service members.

“We were there to advocate for the 80,000 service members who aren’t being heard,” Bowes told The Epoch Times after the conference.

“We’re making a call for help to both Congress and the American people to stand up for us and give us some protection from the Department of Defense so that we can continue to serve—which is all we want to do,” he said.

The press conference allowed active-duty service members and “an exceptional lawyer” to speak out against the military vaccine mandate, Bowes said. And according to him, each is risking their career in order to bring awareness to “the absolutely dire problem that we’re facing right now.”

Like Saran, Bowes considers the current COVID-19 vaccine mandate to be “almost a carbon copy of what happened with anthrax nearly two decades ago.” He added that “anthrax ended up being ruled as a vaccine that couldn’t be forced on service members because it was experimental.”

“It’s shocking to see this exact same thing happen 20 years later.”

Bowes added that the whistleblower service members involved in the press conference “will continue to respectfully bring up the devasting consequences [of the vaccine mandate] to both national security and the health and safety of our force at every opportunity they are given.”

The officer emphasized that his views do not reflect those of the Department of Defense or Air Force.

Continued Concern

Navy Cmdr. Olivia Degenkolb, who has served for 20 years, also participated in the press conference.

Early on, Degenkolb had “significant concerns” regarding the vaccine’s effect on fertility and its carcinogenicity prior to the military vaccine mandate, which she said were dismissed by military medical staff, she told The Epoch Times, emphasizing that her views do not represent those of the Department of Defense or Navy.

She pointed out that the Comirnaty package insert reads: “COMIRNATY has not been evaluated for the potential to cause carcinogenicity, genotoxicity, or impairment of male fertility. In a developmental toxicity study in rats with COMIRNATY there were no vaccine-related effects on female fertility”.

In addition to health concerns, Degenkolb also raised concerns with military leadership about the legality of mandating EUA products, as well as the legality of compelling COVID-19 testing, and mask wearing.

“These EUA products are not formally licensed by the FDA and by federal law, they cannot be mandated,” she said.

She said the Navy ignored those concerns.

Degenkolb’s initial religious accommodation request was denied in December 2021, but her appeal is still pending. Her religious and legal objections have resulted in the loss of an assignment in China, denial of leave, loss of training opportunities, lack of access to her family’s belongings, and other family hardships, she said.

“On top of that, I received a career-ending performance evaluation in August 2022 and have been recommended for a show cause board to terminate my service with the Navy,” Degenkolb said.

Like others who oppose the vaccine mandate, Degenkolb said that the policy has harmed military readiness, at a time when the United States faces increased threats.

Read more here…

Ukrainian President Volodymyr Zelensky has continued urging Israel to help “close the sky” over Ukraine even after statements from the Knesset made clear it will not send military aid to Kiev.

Zelensky made the repeat appeal in a virtual speech to a conference organized by the Israeli newspaper Haaretz. “Isn’t it time for your state to choose who you are with as well?” he said. That’s when he charged that in refusing to send arms Israel is turning “a blind eye to Russian terror”.

⚡️⚡️There would be no alliance between Russia and Iran if Israel helped close the sky | Zelensky pic.twitter.com/o7x4EzjLO5

— War Monitor (@WarMonitors) October 24, 2022

“Is it with the democratic world, which is fighting side by side against the existential threat to its existence? Or with those who turn a blind eye to Russian terror, even when the cost of continued terror is the complete destruction of global security,” Zelensky said provocatively of Israel.

The Ukrainian government has made multiple formal appeals for Israeli defense aid, particularly to obtain the Iron Dome anti-air defense system, since the Russian invasion began in February, after only humanitarian and protective aid has been sent. This limited aid has thus far included items like helmets and bulletproof vests.

“This is the decision of your governments… not to annoy the Kremlin, which was adopted a long time ago,” Zelensky said. “If we had immediately secured our skies when faced with a missile and drone threat, Russia would not even have a motive now to go to Iran and offer it something in exchange for assistance in terror.”

In essence Zelensky charged that Israel’s inaction is facilitating Iran’s expanding influence and its moving toward a nuclear weapon, as Axios described of his Monday remarks:  

The Ukrainian president claimed the alliance between Russia and Iran would not have happened if Israel had made a decision to provide air defense systems to Ukraine when Russia invaded Crimea in 2014 — a decision Zelensky said was made under former Prime Minister Benjamin Netanyahu and hasn’t changed under the current Israeli government.

All of this comes at a sensitive moment in which Israel is fully aware of the widespread reports of Iranian drones deployed inside Ukraine by Russian forces.

Also on Monday Israeli Defense Minister Benny Gantz and his Ukrainian counterpart Oleksii Reznikov spoke by phone. Gantz stressed that Israel stands by Ukraine. But the call readout also stated: “Gantz emphasized the operational limitations faced by the State of Israel. As a result, Israel will not provide weapon systems to Ukraine.”

These “limitations” are likely a reference to Syria, where Russia needs to maintain a strategic understanding with Russia concerning Iran’s military presence there in support of Syria’s Assad. Russia has in effect given a greenlight for Israel to strike Iranian forces and assets over recent years of the war.

Authored by Ron Bonjean & Steve Rochlin via RealClear Wire,

In a nation bitterly divided between political partisans, corporations face fraught choices. The staying power of the new “woke” will likely face its greatest test if Republicans, as expected, capture a majority in the House of Representatives after the November elections.

For example, CPAC’s Matt Schlapp recently sent a letter to House Republicans warning that his organization won’t endorse any candidate for a leadership race unless they vow to reject meetings with “woke” corporations. “Pledge you will not meet with these CEOs or their leadership teams, especially their Government Affairs staff, who have been hostile to policies that help all Americans, until they change their ways.” 

Companies increasingly find themselves caught between two intractable forces: a majority of their customers, fueled by social media activism, who expect them to take a stand on issues that are important to them, and a growing backlash from conservatives who say consumer products have no business dictating social and environmental policy. 

Just look at J.P. Morgan CEO Jamie Dimon’s notable pivot at a hearing on Capitol Hill when he said his bank would not refrain from making new investments in major oil and gas development projects, telling House Democratic members, “Absolutely not, and that would be the road to hell for America.”

The shift is a harbinger of broader political expectations: an emboldened Republican majority with more populists in its ranks itching to take on companies for a variety of perceived transgressions, including statements and policies that are seen as nods to political correctness, as well as “socially responsible” and environmental investment policies.

One only has to look at the recent past. When Major League Baseball moved the 2021 All-Star Game from Atlanta to protest Georgia’s voter law, a handful of Republican lawmakers moved to strip the league of its antitrust protections. Governor Ron DeSantis signed a law to abolish Disney World’s self-governing district. He signed another law dubbed the “Stop WOKE Act” to restrict how race is discussed in schools, colleges, and workplaces. Additionally, 19 Republican state attorneys general are calling on BlackRock to justify its ESG policies.

With risks jumping out from every corner, what’s a conscientious brand leader to do?

With decades of experience supporting business decisions and communications related to social impact, we can point to a few answers. Our research with Penn State University found that 76% of voters feel that companies should be held accountable for making a positive impact on the communities in which they operate – with the sentiment shared almost equally among Democrats and Republicans. Yet only 37% of companies think they are doing a good job and, what’s worse, the gap between voters’ preferences and political rhetoric seems to be growing. 

There’s no one-size-fits-all approach for businesses and other brands to turn the ship. The C-suite must identify social risks that may require a response because of their impact on employees, customers, or other key stakeholders – and this requires a self-assessment 

Specifically, self-assessments to understand a company’s unique position in the marketplace from not only the product perspective but also a reputational one are critical. Paired with an analysis of internal and external stakeholders, as well as a review of the relationship between business lines and relevant external issues, this kind of audit prepares companies to build a framework for response that is cross-functional, aligned to priorities, and authentic. Finally, companies should be prepared to pressure-test their system for responding to external issues to ensure they have considered all potential landmines. 

These recommendations may seem easier said than done, but for those companies seeking a measured approach that allows them to both act on their values and maintain key relationships with policymakers, avoiding the preparation for a Republican Congress now all but ensures crisis down the road. By assessing the connection between business and brand values and creating structure around their decision-making frameworks, modern brand leaders, too, can emerge from the very different challenges of today with renewed bonds with policymakers, customers, and their communities.

An Airbus A320, operated by Easyjet, was flying from Gatwick Airport in the UK to Rhodes in Greece when an “unidentified flying object” at 16,000 feet missed the commercial jet by only feet, according to Business Insider, citing a report by the UK Airprox Board.

Pilots of the A320 said the black and cylindrical object came within 10 feet of the plane in what they described as a “near miss.” 

Airprox’s report said the incident was labeled a “Category A,” implying if the object, most likely a drone, struck the plane, it would’ve resulted in severe damage. 

“In the board’s opinion, the reported altitude and/or description of the object were sufficient to indicate that it could have been a drone,” the board said. 

UK’s National Air Traffic Services said the pilots first reported the incident in July at around 16,000 feet to London air traffic controllers. Here’s what they said:

“Going through FL160 we very nearly just hit a drone. We’re talking less than ten feet,” the pilot said. “We don’t think we’ve hit it, there was a bit of a thud, we’ll come back to you.”

Airprox determined the A320 didn’t hit the drone, and the noise came from within the cabin.   

A drone operating at 16,000 feet is more than 40 times the legal limit (of 400 feet) for unmanned aerial vehicles. 

Easyjet confirmed the incident to Insider: 

“We are aware of the report and will always fully support any investigation.

“Safety is always easyJet’s highest priority and our flight crew acted in accordance with our standard operating procedures to ensure the safety of the flight was not compromised.”

This isn’t the first time a drone has flown dangerously close to a commercial aircraft. In 2018, someone flew a drone hundreds of feet away from an A380 airliner, taking off. 

A shocking video from earlier in 2018 shows a drone dive-bombing a commercial jet in the US. 

And here’s what happens when a police drone in Canada collides with a small plane. 

It could only be a matter of time before a reckless drone operator collides with a large plane and sparks some aviation emergency or disaster. 

Update (1800ET): Microsoft shares are extending their losses during the earnings conference call as the tech titan gives its guidance for Q2:

The More Personal Computing sales outlook showed the biggest impact from the current business environment.

Microsoft is projecting sales in the range of $14.5 billion to $14.9 billion versus $16.9 billion analysts surveyed by FactSet had been forecasting.

The company said sales for its Productivity and Business Processes segment would likely come in around $16.6 billion to $16.9 billion, compared with $17.2 billion expected by Wall Street.

“In our consumer business, materially weaker PC demand from September will continue,” Chief Financial Officer Amy Hood said on the earnings call.

The Intelligent Cloud business segment is expected to see sales at constant currency of $21.25 billion to $21.55 billion, shy of the $21.8 billion according to the average of analysts surveyed by FactSet.

Microsoft said revenue growth in its closely watched Azure cloud-computing business will drop by five percentage points in the current period from the prior quarter.

Azure sales rose 42% in the fiscal first quarter, excluding the impact of foreign-currency exchange rates, meaning the forecast implies a gain of 37% for the second quarter (well below the 40.6% analysts expected)…

Finally, Hood estimated the company will pay $800 million in extra energy costs this fiscal year.

“A lot of it is in Europe,” she said.

“And it’s not just for the winter.”

Hood also suggested that more cost cuts could be coming to Microsoft, after the company confirmed layoffs of fewer than 1,000 employees earlier this month.

“While we continue to help our customers do more with less, we will do the same internally,” she said.

“And you should expect to see our operating-expense growth moderate materially through the year while we focus on growing productivity of the significant head-count investments we’ve made over the last year.”

MSFT is now down almost 8% from the close…

The combined effect of MSFT and GOOGL has erased all of the Nasdaq’s gains for the day…

*  *  *

At first glance, earnings for the tech giant looked solid as Microsoft beat on the top- and bottom-lines:

• Revenue $50.12 billion (+11% YoY), better than the estimate of $49.56 billion

• EPS $2.35 (less than the $2.71 EPS for Q1 last year), but better that the estimate of $2.29

However, the top-line growth was the weakest since 2017…

The breakdown shows the company beating in all the segments (but cloud was barely a beat):

• Productivity and Business Processes revenue $16.47 billion, estimate $16.11 billion

• Intelligent Cloud revenue $20.33 billion, estimate $20.31 billion

• More Personal Computing revenue $13.33 billion, estimate $13.08 billion

• Commercial Cloud revenue $25.7 billion, estimate $25.66 billion

But while the CFO projected strength in cloud…

“This quarter Microsoft Cloud revenue was $25.7 billion, up 24% (up 31% in constant currency) year-over-year. We continue to see healthy demand across our commercial businesses including another quarter of solid bookings as we deliver compelling value for customers,” said Amy Hood, executive vice president and chief financial officer of Microsoft.

Some traders pointed to problems, potentially affecting cloud margins as the MSFT slideshow discussed rising energy prices are boosting the costs of delivering cloud…

Gross margin dollars grew 20% (up 26% CC) and gross margin percentage decreased slightly. Excluding the impact of the latest change in accounting estimate for useful lives, gross margin percentage decreased roughly 3 points driven by sales mix shift to Azure and other cloud services and lower margins in Azure and other cloud services, primarily due to higher energy costs.

MSFT shares tumbled on the print, erasing all of the day’s gains…

“In a world facing increasing headwinds, digital technology is the ultimate tailwind,” said Satya Nadella, chairman and chief executive officer of Microsoft.

“In this environment, we’re focused on helping our customers do more with less, while investing in secular growth areas and managing our cost structure in a disciplined way.”