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THE HEADLINES

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LEAKY PIPES

Amazon is investigating an internal leak of information that is helping independent merchants make more sales online. Through intermediaries, employees have been selling off private information, giving an advantage to some sellers.

Amazon does have policies in place strictly forbidding this exact thing from happening. Fake reviews and counterfeit merchandise have also been an issue for the A to Z retailer. Most of the checks are system based, but employees have been able to get around beat the system and command anywhere from $80 to $2k for their trouble.

The majority of leaks seem to be coming from Amazon employees in China where compensation is relatively low and the growing e-commerce market presents lucrative opportunities. Bezos should be lauding his employee’s entrepreneurial spirit.

Water Cooler Talking Point: “Why do I have a feeling a certain Senator from Vermont has something to do with this?”

 

GOING NUCLEAR

Donny Politics is digging in for what appears to be a trade war of attrition. The Trump administration dropped the economic equivalent of “Fat Boy” on China today, announcing the implementation of a 10% tariff on $200B worth of Chinese goods beginning on September 24th.

In a show of support for American businesses scrambling to adjust supply chains, 10% tariffs will remain in place for the remainder of the year so that US companies have time to get their act together. But, should the trade war drag on into 2019, the import taxes will jump to 25%.

And that isn’t the only change. US officials scrubbed the list of items originally proposed in July, removing smartwatches and blue tooth devices among other items. Because we’re fighting a trade war, not trying to go back to go back to 2008.

China had previously promised to retaliate with $60B in tariffs should the US move forward with the $200B bombshell.

Water Cooler Talking Point: “China is bringing an economic knife to gun fight.”

 

DIVERSIFY OR DIE

The Saudi government and your aunt who hates plastic grocery bags have something in common, they are both very into electric cars. The Saudis recently invested $1B in electric vehicle startup Lucid Motors, a Tesla competitor.

Lucid needed funding in order to get its initial model, the Air, off the ground (no pun intended) by 2020. Just like Tesla, which the Saudis have also invested in, Lucid is years behind schedule in the production of its vehicles.

Lucid, which is headquartered in Arizona, aims to sell its first model starting at $60K in less than two years. The Saudi government’s Public Investment Fund aims to the be the world’s largest sovereign fund by 2030 in an effort to counter falling oil prices.

Water Cooler Talking Point: “When the royal family of Saudi Arabia begins to lose confidence in crude oil, maybe it’s time for the rest of us to jump on the electric car bandwagon after all.”

 

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IN OTHER NEWS

• Nestle has decided to sell its Gerber Life Insurance brand to Western & Southern Financial Group for $1.55B in cash. This should come as no surprise as Nestle announced in February that it was looking into a potential sale. Nothing like pitching baby life insurance to boost sales.

 

• Moody’s Analytics has estimated damage from Hurricane Florence to be in the range of $17 to $22B and could increase as flooding continues. While economists estimate that the hurricane will only shave 0.2% off of the third quarter GDP, it is already one of the top ten costliest hurricanes to date.

 

• CEO of Tyson Foods, Tom Hayes, is stepping down from the position … and get this, not because of any workplace misconduct. He has indicated that his decision was not driven by health problems or to pursue another job, but by ‘things that are personal’ to him. Or maybe he just got sick of the still-kinda-frozen-in-the-middle buffalo chicken tenders in the cafeteria every day.

 

• Coca-cola is in talks with Canadian marijuana producer Aurora Cannabis to develop beverages infused with CBD. Maybe it’s marijuana that’ll end up killing the polar bears after all.

 

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