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Category: topSource: bizjournalsJan 25th, 2023

Is The Ethereum Merge Priced In?

Is The Ethereum Merge Priced In? By Hal Press, founder of North Rock Digital, first published in Bankless What’s Up With The Merge? As we approach the Merge, we wanted to provide a write-up on how we are thinking about the Ethereum ecosystem and specifically Merge-related investments. This is meant as a follow-up to the prior article we wrote on Ethereum, which can be found here.  Since I published the original article in January much has transpired, some assumptions have changed and the outlook for the future has been altered. Despite this, the core thesis remains, Ethereum is set to undergo the largest structural shift in the history of crypto. Back in January, the path to the Merge was extremely uncertain. Now, that path has crystalized. The final testnet, Goerli, was recently completed successfully and a Mainnet target date has been set for Sep 15/16.  So where do we stand? The Biggest Structural Shift in Crypto History Regarding the Merge the thesis has not changed, Ethereum is set to undergo a massive structural shift as expenses will effectively be reduced to zero. The shift will give rise to the first large-scale structural demand asset in crypto history. As we have stated in our core thesis many times, this paper will address what has changed and new topics not discussed in the prior article. First, it is useful to highlight aspects of the core Ethereum model to get a sense of some of the key fundamentals such as supply reduction and the post-Merge staking rate.  The largest shift since last December is that ETH-denominated fees have fallen significantly. However, there is an interesting dynamic at play here. Although fees have declined, active users have experienced a steady uptrend since late June.  This may seem inconsistent as more users should lead to higher gas. However, we believe this dynamic is caused by recent efficiency optimizations of various popular Ethereum applications. The best and most significant example is Opensea, which in migrating Seaport (from Wyvern) increased gas efficiency by 35%. This has led to a reduction in gas that doesn’t correlate to a decline in activity.  In fact, multiple indicators suggest that despite the low gas readings activity has been increasing recently (more on the specifics here later). This raises an interesting question: what is the optimal fee run rate for Ethereum? Higher fees mean more ETH is burned and post-Merge also correlates to a higher staking rate, but these higher fees also limit adoption.  As we saw in ’21, when fees are too high, some users get pushed to other L1 ecosystems. After roll-ups scale appropriately, Ethereum should be able to achieve both high fees and continued adoption. In the current environment though, it is interesting to think about the optimal mix. We believe the optimal point is approximately the point at which fees are high enough to burn all new issuance. This will enable ETH supply to be stable while also keeping fees low enough not to inhibit adoption. Interestingly, of late, fees have found an equilibrium near this point. Lower fees also seem to be having a positive impact on adoption as active users have begun to increase after a long downtrend.  Despite the fact that we seem to be near an optimal fee run rate, the reduced fees do negatively impact various model outputs. This impact is not critical as at the current run rate the burn would still be still large enough for ETH to be slightly deflationary post-Merge. Importantly, the current run rate would continue to drive structural demand as the majority of issuance is unlikely to be sold, while fees that are used must be purchased off the open market.  The staking rate will increase post-Merge by ~100 bps from 4.2% to 5.2%. However, this does not properly illustrate the true impact. To fully appreciate the shift, we must evaluate the real yield rather than the nominal yield. While the current nominal yield is ~4.2%, the real yield is close to zero, as 4.4% of new ETH is issued every year. In this context, the real yield is currently ~0% but will increase to ~5% post-Merge. This is an enormous shift and will create the highest real yield in crypto by a large margin. The only other comparable yield is BNB with a 1% real yield. ETH’s 5% yield will be a market-leading figure. What is the significance of this yield? Stakers will receive a net ~5% rate, which equates to 100/5= ~20x earnings. This multiple is considerably cheaper than the revenue multiple because the staking participation rate is quite low, meaning stakers receive an outsized share of total rewards. This is one of the key advantages of ETH from an investment standpoint.  As there are so many other uses for ETH, throughout the crypto ecosystem, most ETH ends up locked in those applications rather than staked. This in turn allows stakers to receive an outsized real yield.  In terms of the flows, ETH will transition from enduring structural outflows of ~$18mm/day to structural inflows of ~$0.3mm/day. While the demand side of the flow equation has softened, the complete reduction of the supply side remains the most important variable. Our estimate for the ETH-denominated supply reduction is actually larger than it was previously. This is due to the fact that the price declines from the highs have not been accompanied by a corresponding hash rate reduction. As a result, miner profitability has decreased dramatically, and they are likely selling close to 100% of mined ETH. For calculation’s sake, I have assumed 80% of miner issuance is being sold. In this context, ETH has found an equilibrium in which miners sell roughly 10.8k ETH ($18mm USD) per day. Given that fees have been averaging ~$2mm this yields a net outflow of ~$16mm. Post Merge this sell pressure will reduce to zero, and it is projected that there will be a structural inflow of ~$0.3mm/day post-Merge.  To conclude, while many of the numbers have shifted meaningfully in the last eight months, the conclusion remains roughly the same, ETH will shift from requiring ~$18mm of new money entering the asset to keep the price from declining to requiring ~$0.3mm exiting to keep the price from increasing.  To summarize, the staking rate and structural demand are lower than they were 6 months ago. However, this is to be expected in a period of slower activity, and if activity continues to rebound these rates will increase. The primary investment case remains the same, there is an enormous opportunity to front-run the largest structural shift in the history of crypto.  Another point that I think is often overlooked here is that the Merge is more than a shift in supply and demand. It is also a massive fundamental upgrade for Ethereum as the network becomes much more efficient and secure in many ways. This is part of what differentiates the Merge from prior BTC halvings.  It is 3x as large of a supply reduction combined with a massive improvement in fundamentals compared to a decline in fundamentals in the case of BTC halvings (reduced security).  Finally, there are two additional dynamics worth discussing. 1. Time Harvesting Before addressing how this relates to ETH it is important to lay some contextual groundwork.  Why is it that the SPX (or virtually any US/Global equity index) has been such a profitable and consistent investment vehicle over the long term? Most people think this dynamic has been driven almost entirely by earnings growth and multiple expansion. They would posit that if growth slows or the multiple stops expanding these investments would be unlikely to have positive returns going forward. This is incorrect.  The primary and most reliable source of growth for the price of these indices has been the passage of time.  Here is an example to illustrate this somewhat unintuitive point. A lemonade stand, LEMON (LEMON = The Enterprise, $LEMON = LEMON shares), earns $1 each year. There are 10 shares of $LEMON outstanding. LEMON has no cash or debt on its balance sheet. The market currently values $1 of ex-growth equity earnings at a 10x multiple. What is LEMON worth today? What about each share of $LEMON?  If we assume that next year LEMON will continue to earn $1 annually while the market applies the same multiple, what will LEMON/$LEMON be worth in a year? Take a minute and come to an answer.  If you answered $10/$1 for the first pair of questions you are correct. If you answered $10/$1 for the second pair, you are not. For part 1, LEMON is worth $10 as the market applies a 10x multiple to its $1 of earnings and assigns 0 value to its balance sheet. For part 2, the market continues to apply a 10x multiple to the $1 of earnings, but importantly, it also assigns $1 to the $1 of cash that now sits on LEMON’s balance sheet. LEMON is now worth $11 and each share is worth $1.10. When companies earn money, the money doesn’t disappear, it flows to the company’s balance sheet and the value of it accrues to the owners of the business (the equity holders). $LEMON has appreciated 10% in a year due to the earnings they have generated, despite 0 growth and 0 multiple expansion.  This is the power of earnings yield paired with the passage of time.  Crypto hasn’t benefited from this dynamic at all. In fact, crypto actually suffers from the reverse effect. Since almost all crypto projects’ expenses are greater than their revenues, they must dilute their holders to generate the funds necessary to cover their negative net income. As a result, unless earnings grow or their multiple expands, the price of each individual token will decline. The most notable exception I can think of is BNB, which is the sole current L1 to generate more revenue than expenses. It is no surprise the chart of BNB/BTC is essentially up only and recently broke an ATH. ETH will enter this exclusive class the moment it transitions to PoS. Post-merge ETH will generate a real yield of approximately 5%. This yield will be very different from virtually every other (non-BNB) L1 where the staking yield simply comes from inflation that offsets the yield. All else equal ETH holders will earn 5% each year. Time will become a tailwind rather than the headwind it is for 99.9% of other projects.  This will also change the psychology of holders and incentivize a stronger long-term buy and hold approach, effectively locking up more illiquid supply. Additionally, the “real yield” thesis and the fact that ETH will be the first large-scale real yield crypto asset will be particularly appealing to many institutions and should help accelerate institutional adoption. 2. The Wall of Worry Throughout the last few months, investors have been extremely skeptical about technical risks, edge cases, and timing risks.  The latest edge case that has generated attention is the potential for PoW forks of Ethereum that live on after the Merge. Some PoW maximalists (miners etc.) would prefer to use PoW ETH and think that a forked version of the current ETH is superior to ETC, which already exists as a PoW alternative. We do not believe there is much value in the fork, but our opinion on this matter is not particularly relevant.  The important point is that this fork will have no impact on post-Merge PoS ETH. All of the potential risks are either easily managed or not risks in the first place. For example, replay attacks will most probably not be an issue as the PoW chain is unlikely to use the same chain ID. Furthermore, even if they maliciously choose to use the same chain ID, this can be managed by either not interacting with the PoW chain or first sending the assets to a splitter contract.  Finally, even if a user does get replay attacked, it will only impact that individual user’s assets and not the overall health of the chain. What the PoW fork does do is provide a dividend to ETH holders, further adding to the value of the Merge. If the fork has any value, ETH holders will be able to send it to an exchange and sell it for additional capital, much of which will then be recycled back into PoS ETH. While we view this as a positive for the Merge-related investment case, many are worried about the potential risks and a litany of other edge cases. We have weighed each risk and concluded the upside far outweighs the downside.  Nonetheless, these concerns are keeping many long-term believers sidelined.  As we approach the Merge many of these issues will be addressed. Eventually, many of these skeptics will be converted, creating fueling continued inflows as we approach the event and culminating with a large set of buyers who will purchase ETH the day the Merge occurs successfully. This should help offset any “sell the news” dynamic.  Just last month, less than 1/3 of people thought the Merge would occur before October. Now the date has been confirmed for mid-September and still, the market is only pricing in two-thirds chance of it occurring before October. Given this backdrop how should we expect prices to move as we approach the Merge? This is the central question. First, we acknowledge the reality that macro will continue to have a large impact on absolute price levels despite the Merge. However, it is still reasonable to think through how Merge related alpha will evolve over the coming weeks. In our opinion, the path gets harder to predict the further out you look but then at some point when you’ve gone far enough it starts to become easier again. Short-Term Despite the narrative that has already been building around the Merge, positioning is still quite light within the more discretionary pockets of the market. Perpetual funding has remained negative for most of the rally since June, indicating that there are more shorts than longs in the perp market. Recently, Bitfinex longs, another notable discretionary pocket of ETH exposure, were reduced back to the lows. IMO, this light positioning is likely due to many larger participants viewing this move as a “bear market rally” and therefore wanting to put hedges on as we have continued higher. Historically, there is a large contingent of investors, who lean in the direction of BTC maximalism and will always look to fade the Merge narrative. Their theses primarily revolve around one of two central points.  The first is: “the Merge has been 6 months away for 6 years.” The second concern is around technical/execution risk. After evaluating the timing and execution risk, we have become comfortable with both. After the final testnet, Goerli, was successfully Merged earlier this week, the core developers set a target for the Mainnet Merge for September 15/16. All that remains is coordination. While many are concerned about the execution risk, the upgrade has been tested extremely rigorously over the years and cross-checked by many teams. Furthermore, one of the core pillars of Ethereum is resilience. This is the reason there are so many different clients–the redundancy acts as a safety net to protect against singular edge cases or bugs. Multiple, usually well over two, unrelated fluke events occurring simultaneously would be required to affect the protocol. This built-in resilience, the most accomplished developer team in the space, and many years of preparation have given us comfort that a technical issue, though a risk, is unlikely.  Given the cautious positioning and constant desire to “fade” the trade, I expect the next four weeks to follow a similar path as the prior four. There will be periods of pronounced fear as people overanalyze extremely unlikely edge cases. However, I expect the price declines around these periods to be shallow as there are many underexposed parties looking to add exposure on any weakness. Furthermore, almost everyone selling ETH over these next few weeks is only selling it tactically and planning to buy it back at some point before, or immediately after the Merge occurs.  This dynamic means net outflows are measured. On the flip side, I expect the hype around the Merge to magnify significantly as the date comes into focus and the narrative is picked up by the mainstream media. As I believe the thesis is extremely compelling and digestible by both institutional and retail capital, I expect inflows to accelerate as we approach the Merge creating a higher high, higher low dynamic as we approach the date.  What happens once the Merge actually occurs? Normally, you would think there would be risk of a “sell the news” reaction; many investors concerned about technical risk, plan to buy post-Merge. They believe they will capture the structural effect of the Merge without the technical risks. The post-Merge period will also depend on how much FOMO is generated as we approach the Merge and positioning when we actually get there.  We do expect significant buy flows and follow-through directly after the Merge as it is effectively “de-risked.” Medium-Term We expect a period of range trading as short-term traders sell, and this sell flow will be digested by the structural demand and larger slower moving institutional accounts. Price action in this period is less predictable and depends on the macro environment. As I have said previously, macro is incredibly hard to predict, but I will offer a few thoughts, nonetheless.  The crypto macro environment is driven by one core metric: whether adoption is growing, stable, or declining. This metric is somewhat impacted by the broader macro environment, but ultimately what matters most is this adoption metric. The reason this metric affects prices is because adoption also drives the long-term flow of funds into or out of the space. Simply put, when users are adopting crypto, they are generally also investing new money into the crypto ecosystem, and this is what drives the macro. When adoption is declining macro is hostile, when it is flat, macro is neutral and when it is growing, macro is accommodating. So how does the macro look today?  For the majority of the last 8-9 months, we have been in a declining adoption environment with a net outflow of users departing the ecosystem.   From May ’21 until the end of June daily active users have experienced a declining trend. Over the last ~6 weeks, we have seen a nascent recovery as users have steadily been increasing. This is a green shoot and indicates a potential thawing of the macro environment. We had been in a declining adoption phase, and we have now, at least, entered a stable adoption phase and potentially an increasing adoption phase. There are other green shoots that have been sprouting recently as well. After many weeks of redemptions, Tether has started to slowly mint new coins. After a long period of outflows, new money has started to enter the space again.  This impact is not unique to the Ethereum ecosystem, AVAX has also recently seen daily active users increase. NFT users and transactions have been stable recently. And certain web searches have started to positively inflect, while others are more stable. These are not dramatic increases, nothing like the exponential increases we saw at the start of the ’21 bull market. This is why I label them green shoots. They are still young and fragile. If they are smothered, they will likely wither and die, but if nurtured they could grow into something material.  We think the broader macro environment will play a key role in determining whether these green shoots live or die. To us, inflation is by far the most important macroeconomic variable; therefore, we believe that if inflation moderates and allows the fed to pivot and ease monetary policy there is a good chance these green shoots will grow stronger. However, if inflation remains high and the fed is forced to continue tightening policy they will likely be smothered and die. Predicting the course of inflation is not our primary domain, however, due to its significance in markets today, we studied it closely. After review, we feel moderating inflation is the most likely outcome, which should give these green shoots a chance to blossom.  Another advantage, in favor of a more sustained bottom, is the fact that an enormous amount of vesting from project launches in the last 24 months has now been absorbed. Furthermore, as most of the projects are down 70-95%, the USD notional size of all future vesting is also vastly reduced. Together, these two dynamics help meaningfully reduce the overall daily supply the space must absorb.   Lastly, the final variable that we think will impact this equation is none other than the Merge. Investors underestimate the impact the Merge will have on the macro environment of the entire space. There is some uncertainty about how much the supply reduction caused by prior BTC halvings has fueled the ensuing price action rather than coincidentally aligning with the natural cycles of human emotion and monetary policy.  We sympathize with these uncertainties and think there has been an element of luck in the timing. However, we think the supply reductions also had an impact and the truth likely lies somewhere in the middle. Another common criticism is that supply changes don’t drive price and all that matters are demand changes. We are not in accord with this thinking. A supply reduction is not different than a demand addition. Let’s say miners sell 10k ETH/day, and instead of getting rid of this sell pressure we simply add 10k ETH/day of buy pressure. This would have the exact same impact as eliminating the miners’ sell pressure but would be a demand change rather than a supply change. It is obvious these two options would have the same impact and it, therefore, makes no sense to us why one would matter more than another.  If we then believe that BTC halvings have impacted crypto’s macro, then it stands to reason that the Merge should do the same. While ETH dominance is significantly lower than BTC dominance at the time of the last halving, the impact from the Merge is nearly as large as the prior BTC halving as a % of total crypto market cap and significantly larger on an absolute basis.  Post-Merge crypto will be relieved of ~$16mm of daily supply. This is not an insignificant amount. To recognize this, it is useful to consider the cumulative impact. We think a TWAP of 70k ETH per week would have a market impact. That is effectively the impact the Merge will have except it doesn’t stop after a year; it continues into perpetuity. This has the potential to positively influence the entire space as the positive flow impact trickles into other parts of the market. This should provide an added macro tailwind to help nurture the green shoots we referenced earlier and increases their odds of survival. To conclude, if macro moderates at all, there is a real chance that what began as a bounce off of a capitulation bottom morphs into a more sustainable and organic recovery and the Merge should help aid this process. Long-Term In the long-term, the future becomes easier to predict, as structural flows are most important over this time horizon and easier to forecast. This is where the Merge’s impact is most pronounced. As long as Ethereum’s network adoption continues, which we deem likely, structural demand will remain and further inflows will also exist. This should result in sustainable and consistent appreciation, especially compared to other tokens, over many years (hopefully decades) to come. We expect Ethereum to surpass Bitcoin as the largest cryptocurrency within the next few years as we believe flows are the most important variable in crypto. Ethereum will forever have a flow tailwind post-Merge. Bitcoin will forever have a flow headwind. To get a sense for how things may look, the BNB/BTC chart is a good place to start.  BNB/BTC has steadily increased and made multiple new ATHs during this bear market despite little narrative momentum. We believe this is primarily due to the fact that BNB is the only L1 with structural demand. Post-Merge Ethereum will have greater structural demand than BNB both on an absolute and market cap weighted basis. Investment Strategies to Win the Merge 1. ETH/BTC Before evaluating the ETH/BTC trade it is necessary to provide some more general context on the PoW vs PoS debate. Much of the following is paraphrased from the appendix of the first article but it is worth reiterating. We believe PoS is a fundamentally more secure system for a variety of reasons. Firstly, each unit of security costs less with PoS. To understand why PoS provides more efficient security than PoW we first need to explore how these consensus mechanisms generate security in the first place. A consensus mechanism is as secure as the cost to 51% attack it. The efficiency of the system can then be measured by the cost (issuance) required to generate a unit amount of security.  In other words, how many dollars the network has to pay out to receive $1 of protection from a 51% attack. For PoW, the cost of a 51% attack is primarily the hardware required to obtain 51% of the hash rate. The relevant metric is how much money miners require to invest $1 in mining hardware. The math tends to work out close to 1 to 1 meaning miners require 100% annual rate of return on their investment or in other words $1 of annual issuance for each $1 they spend on hardware and utilities. In this context, the network needs to issue roughly $1 of supply each year to generate $1 of security. In the case of PoS, stakers are not required to purchase hardware, so the question becomes what return do stakers demand to lock up their stake in the PoS consensus mechanism? In general, stakers require a significantly lower rate of return than the 100% miners typically demand. The primary reason for this is that there is no incremental cost outlay and their assets do not depreciate (mining hardware typically depreciates close to 0 after a few years). The required rate should generally fall in the 3-10% range. As we calculated earlier, the current estimated post-Merge staking rate of 5% falls right in the middle of this range. This means that to gain $1 of security a PoS needs to issue $0.03-$0.10 of issuance. This is 10x-33x more efficient than PoW (20x more in the case of Ethereum’s PoS).  To conclude, this means that a PoS network can issue ~1/20th the issuance of a PoW network and be just as secure. In the case of ETH, they will actually issue about 1/10th of the issuance and the network will be twice as secure as it was during PoW. This efficiency is not the only advantage. Both consensus mechanisms share a common issue, which is that the security of the chain is correlated to the price of the token. This has the potential to create a self-reinforcing negative feedback loop whereby the reduction in token price causes a reduction in security, which therefore causes a decrease in confidence and drives a further decrease in token price and then repeats. PoS has a natural defense against this dynamic, PoW doesn’t. The attack vector for PoS is much more secure than PoW. First, to attack a PoS system you must control a majority of the stake. To do this you must purchase at least as many tokens as are staked from the market. However, not all tokens are available for sale. In fact, much of the supply is never traded and is effectively illiquid. Furthermore, and most importantly, with each token acquired the next token becomes harder and more expensive to acquire.  In the case of Ethereum, only ~1/3 of tokens are liquid (moved in the last 90 days). This means that once a steady state staking participation rate of closer to 30% has been reached it will be extremely difficult no matter the amount of money possessed, to attack the network. An attacker would need to purchase the entire liquid supply, which is impractical and nearly impossible. Another important feature of this defense mechanism is that it is relatively unaffected by price. Because the limiting factor to attack is liquid supply rather than money it does not get much easier to attack the network with lower prices. If there is not enough liquid supply (measured as a % of total tokens) to purchase, it doesn’t matter how cheap each token becomes because the limiting factor is not price. This price-insensitive defense mechanism is incredibly important to deter the potential negative feedback loop that declining prices could otherwise create. In the case of PoW, in addition to being 20x less efficient, there is no such defense mechanism. Each hardware unit may be marginally harder to acquire than the next, but there is no direct relationship, and if there is a correlation that does exist, it is weak at best. Importantly, it also becomes significantly easier to attack at lower prices as the number of hardware units required decreases linearly with price and the supply of hardware units does not change. It is not reflexive in the manner the PoS liquid supply defense is.  Other advantages of PoS such as better energy efficiency and better healing mechanisms are articulated clearly elsewhere, therefore we will not focus on them in this piece.  Another misconception about PoS is that it drives centralization by rewarding large stakers more than small stakers. We believe this to be incorrect. While large stakers receive more staking rewards than smaller stakers, this does not drive centralization. Centralization is the process by which large stakeholders increase their percentage of the stake over time. This is not what occurs in the PoS system. As large stakers have a larger stake to begin with, the larger rewards do not increase their percentage of the pool. For example, if 10 ETH is staked between two counterparties, Counterparty X has 9 ETH and counterparty Z has 1 ETH. X controls 90% of the stake. A year later X will have received 0.45 ETH and Z will have received .05 ETH. X has received 9 times the amount of rewards as Z. However, X still controls 90% of the stake and Z still controls 10%. The proportions have not been altered and therefore no centralization has occurred.  These inherent differences impact the debate around ETH/BTC. Most consider ETH a totally different asset to BTC as they do think is designed to be a decentralized SoV (replace gold), while BTC is. We believe in many important ways Ethereum is better suited to be a long-term SoV than Bitcoin. Before we compare the two, it is first necessary to evaluate Bitcoin’s current security model and how it may evolve over time. As discussed earlier, a system’s security is derived from the cost of a 51% attack. As a PoW network, this cost is determined by the amount of money it would take to purchase enough hardware rigs and other equipment/electricity necessary to control 51% of the hash power. This is roughly equivalent to the cost necessary to recreate the current mining hash rate that exists on the network. In an efficient market (mostly an accurate assumption over the medium/long term), the total hash rate is a product of the value of the issuance that miners receive. Bitcoin is as secure as the value of its issuance. As discussed earlier, this security is both inefficient and importantly lacks the reflexive defense of a PoS system. What happens when Bitcoin halves its issuance every four years? The system fundamentally becomes 50% less secure assuming all other variables are held constant. Historically, this has not been a large problem as the value of the issuance (and therefore the security) is a function of two variables: the number of tokens issued and the value of each token. As the price of the tokens has more than doubled around every halving cycle, this has more than compensated for the issuance reduction on an absolute basis. The absolute security of the network has increased through each cycle despite the number of tokens being issued halving. However, this is not a sustainable dynamic long-term for multiple reasons. First, it is not realistic to expect the value of each token to continue to more than double with each cycle. An exponential price increase is mathematically impossible to sustain over long periods of time. To illustrate this point, if BTC price doubled every halving cycle it would exceed global M2 after ~7 more halving cycles. Eventually, BTC price will stop increasing at this rate; when it does each halving cycle will drastically cut into its security. If the BTC price declines around the halving cycle, the security reduction will be even more significant and could trigger the negative feedback loop referred to earlier. This security system is fundamentally unsustainable so long as prices are capped, which they are. The only way to counter this issue is to generate meaningful fee revenue. This fee revenue could then replace some of the issuance and continue providing an incentive for miners and therefore provide security even after issuance is reduced. The issue for Bitcoin is that fee revenue has been negligible, and also declining, over a long period of time. In our opinion, the only practical way to generate security over the long term is through significant fee revenue. Therefore, to function as a sustainable SoV a system must generate fees. The alternative is tail emissions, which guarantees inflation compromising the SoV utility. Long-term security represents the most important property of an SoV. For example, gold has captured the majority of the SoV market for so long as nearly all market participants are confident that it will remain legitimate long into the future. For a crypto asset to become an adopted and successful SoV, it too must convince the market that it is extremely secure and that its legitimacy is guaranteed. This can only be possible if the protocol’s security budget is sustainable for the long term, inherently favoring a PoS system that has a large and durable fee pool. We believe the most likely candidate for this system is ETH. It is one of only two L1s with a significant fee pool. The other, BNB, is extremely centralized.  Credible neutrality is the second critically important characteristic of a successful SoV. Gold has no allegiance or reliance on anything. This independence creates its success as an SoV. For another asset to be widely adopted as an SoV it must also be credibly neutral. For a cryptocurrency credible neutrality is accomplished through decentralization. Today, the most decentralized cryptocurrency is undoubtedly Bitcoin. This is primarily because Bitcoin has very little development effort, and the protocol is mainly ossified, but nonetheless, the fact remains that it is by far the most decentralized protocol today. If you tried to kill Bitcoin today, it would be extremely hard. If you tried to kill ETH today, it would still be extremely hard, but likely easier than BTC.  However, we believe it is more important to look at the end state than the current state so long as there is a realistic path to achieve this end state. Ethereum has a clear roadmap ahead of it. We believe that while we are currently only in the middle of this roadmap, eventually (I’d estimate ~8-12 years) this roadmap will be complete, and the significance of the core developer team will fade. At this point, ETH will have a compelling case that it is more decentralized than BTC in addition to possessing far superior long-term security.  Contrary to popular belief, PoS naturally promotes decentralization more than PoW. Larger PoW miners receive a clear benefit from economies of scale, which drives centralization. Scale is much less relevant for PoS as the cost of setting up a node is vastly lower than a PoW rig and there is no real benefit to large-scale electricity as the electricity required for PoS is 99%+ lower. The economy of scale is a large factor for PoW but is not for PoS. 400,000 unique ETH validators exist today and the top 5 holders only control 2.33% of the stake (excluding smart contract deposit). This level of decentralization and diversity separates ETH from all other PoS L1s. Furthermore, this compares to BTC favorably as the top 5 mining pools today control 70% of the hashrate. While some critics will point out that liquid staking providers control an overwhelming portion of Ethereum’s stake, we believe these concerns are overblown. Additionally, we expect these concerns to be addressed by the liquid staking protocols and expect additional checks to be put in place to further protect against these concerns.  In summary, PoS is a fundamentally better consensus mechanism for a crypto SoV. This is the reason the Merge will represent a major milestone on Ethereum’s roadmap, marking a critical juncture in its journey to become the most appealing cryptographic SoV. The fundamental reasons discussed above are the reason we favor the ETH/BTC trade long-term and specifically around the Merge. However, flows, and specifically structural flows, are most important in determining price. It is the structural shift in flows that the Merge triggers that makes this trade so appealing and why the Merge is such a large catalyst for it. Historically, the structural flow for both BTC and ETH have been quite similar. Although ETH has had a smaller market cap its issuance has been ~3x larger on a market cap weighted basis. This larger issuance has made it extremely difficult for ETH to ever surpass Bitcoin in market cap as it would require ETH to absorb 3x the daily USD denominated supply. An interesting exercise is to think about the chart above and what the inputs are as clearly there has been a strong relationship (stronger than normal correlation would imply). The charted values are a product of tokens issued and token price. What happens if you reduce the tokens issued variable but want to retain the relationship? You must increase token price. So what should we expect to happen when we reduce the token issued variable for Ethereum by 90%? This is not to say that price should 10x to offset this reduction as the impacts are not necessarily linear, but the relationships are worth considering.  To conclude, post-Merge the passage of time will forever be a flow tailwind for Ethereum while for Bitcoin it will always be a headwind. Ultimately, this straightforward reality is what we believe will be the primary driver of the eventual flippening. 2. Staking Derivatives As Ethereum is such a large ecosystem many other areas will be tangentially affected by the Merge. As an investor, it is often interesting (and profitable) to consider the second and third-order effects of certain catalysts to search for opportunities that may be inefficiently priced in the market. Regarding the Merge, there are many options such as L2s, DeFi, and Liquid Staking Derivative (LSD) protocols. After a comprehensive review of the different alternatives, we have concluded that the liquid staking protocols are set to be the largest fundamental beneficiaries of the Merge (even more so than ETH).  The thesis is simple. The LSD protocols’ revenues are directly impacted by the price of ETH plus multiple other Merge related tailwinds that compound each other.  Additionally, their largest expense, the cost of subsidizing the liquidity pool between their staking derivate token and native ETH, declines, effectively to zero, shortly after the Merge. At a high level, I expect a 4-7x Merge driven increase in ETH protocol revenue (assuming only modest a ETH price increase) and a 60-80% reduction in their largest expense. This is a uniquely powerful fundamental impact.  We must examine the revenue and expense model of these protocols to fully comprehend this thesis. Using Lido as an example, as it is the largest of the LSD protocols, let’s examine the model. Note that these principles also apply to the other players as they are generally quite similar. Lido generates revenue as a percentage of the staking rewards that accrue to their liquid staking derivatives, stETH. Lido receives 5% of all staking rewards generated. If a user deposits 10 ETH for 10 stETH and generates an additional 0.4 stETH over the course of a year. The user keeps 90% of 0.4, the validator keeps 5% and Lido keeps the other 5%. As can be seen, Lido’s revenue is purely a function of the staking rewards generated on its LSD.  These staking rewards are a function of four separate variables: total ETH staked, ETH staking rate, LSD market share, and ETH price. Importantly, the staking rewards are the product of all four variables. If multiple variables are impacted their effect on the output compounds. In other words, if you double one and triple the other the impact on the staking rewards is 600%. All the variables, except market share, are directly impacted by the Merge. Total ETH staked will likely increase dramatically from the current 12% to closer to ~30% a 150% increase. As discussed earlier, the staking rate is likely to increase from 4% to ~5%, a 25% increase. There is no reason to think the Merge will significantly impact LSD market share so we can assume this is held constant and has no impact. Lastly, for the sake of this exercise let’s assume a 50% increase in the price of ETH. The aggregate effect of these different variables is 250%*118%*150%= 444% or a ~4.4x increase in revenue.  Expenses also meaningfully drop. The largest expense of these LSD protocols is incentivizing the liquidity pools between their LSD and native ETH. Given there are no withdrawals yet, it is extremely important to create deep liquidity to manage large flows between the LSD and native ETH. However, once withdrawals are enabled these incentives will no longer be required. As there will then be an arbitrage if the two ever differ materially, natural market forces will keep them relatively pegged as arbitrageurs buy the LSD on any dips.  This will allow the LSD protocols to drastically reduce their issuance (expenses), which will also materially reduce the sell pressure on the tokens.  LDO is trading at ~144x revenue on a pre-Merge number but this declines to ~31x when you look at it on a post-Merge number. While not overly cheap by traditional measures, this is attractive for a high-growth strategic asset in the crypto space where valuations are typically elevated. Importantly, this is real revenue that will accrue to the protocol.  A common concern among LDO critics is that this revenue does not get returned to holders. They often compare the protocol to Uniswap for this reason. While it is true the revenue is not passed through to token holders at current, we do not think this is a legitimate concern nor do we think the Uniswap comparison is correct—just because token holders do not receive cash flow today does not mean they will not in the future. We believe there will be a time when these returns are enabled. We also know that multiple large stakeholders agree on this issue. Furthermore, we do not think Lido should return cash today and would actually be very concerned with management’s competence if they did. This is an extremely early-stage business (~1.5 years old) that is still in its infancy growth phase. They require regular cash raises and are burning cash on a run rate basis today (this will change post-Merge). It would not be sensible to raise money from investors to cover the burn and then distribute protocol revenue to token holders, in turn increasing the burn. This would be akin to a startup paying out investor distributions with early revenue despite not generating enough revenue to cover expenses. This would never happen in the traditional capital markets because it is not rational.  Many crypto participants are also concerned about Lido’s dominant market share. They have 90% share of the LSD market and stETH makes up ~31% of total staked ETH. While we think the concerns around centralization are overstated, we still believe Lido should remain below 33% share of staked ETH to eliminate any doubt about Ethereum’s credible neutrality. As far as the investment case for the protocol we do not think a 33% market share cap is concerning. In our opinion, there are many other growth vectors Lido can pursue other than market share, and the investment is already quite compelling with its current share.  To conclude, Lido is a key piece of infrastructure in the Ethereum ecosystem that has established product market fit and dominant market share in what will remain an incredibly fast-growing portion of the market. In our opinion, the frequently cited concerns around the protocol are either misplaced or misrepresented. Furthermore, it is reasonably priced considering its past and expected future growth prospects and therefore represents one of the most investable assets in the space. While Lido is the market leader and largest player there are two other LSD protocols, Rocketpool and Stakewise, that also merit consideration. There are many unique aspects of each LSD and intricate detail that could be expanded upon. However, for the sake of digestibility, we will focus primarily on the high-level differences and expand upon the finer points in future discussions. Both RPL and SWISE should benefit from any share that Lido cedes due to the centralization concerns. While we think any Lido share losses will be modest, even modest losses for Lido would equate to outsized gains for the smaller players. For example, if LDO loses 4% market share, RPL gains 2.5% of that, and SWISE gains 1.5%, LDO will lose ~12% of their market share but RPL will gain ~50% and SWISE ~125%.   The 2nd largest player in the market, Rocketpool (RPL), has a unique staking mechanism and tokenomics. To stake through RPL, validators must pair RPL with native ETH and are required to maintain a minimum ratio between the two. This dynamic creates predictable and guaranteed demand for RPL as the ETH staking participation rises and more validators adopt the solution. Another benefit of RPL is the practice of validators pooling with other users, allowing the required ETH to set up a staking node to be reduced from the normal 32 ETH to only 16 ETH. This reduced minimum allows for smaller operators to set up nodes and further incentivizes decentralization. This makes RPL a perfect complementary player to LDO, which should act as a tailwind for RPL’s market share as they will be a primary beneficiary of Lido’s effective market share cap.  Lastly, Stakewise is another interesting alternative to LDO. Their model is very similar to LDO’s but they are focused increasingly on institutional adoption, which should position them well for a post-Merge marketplace. They also benefit from a highly driven and professional team that has continued to execute well. Notably, they have discussed plans to eventually implement token-holder-friendly tokenomics that would see token holders directly receive excess protocol revenue. Additionally, SWISE has been gaining notable traction with larger accounts looking to diversify their staking products (one proposal alone was recently approved by Nexus Mutual which would increase their TVL by 20-25%). As they are the smallest player with the highest valuation, they are likely the highest risk/reward investment in the category.  To conclude, it’s hard to differentiate between value within the group. LDO is the cheapest and most secure, but with the least market share upside. SWISE is the most expensive, but with the most market share upside and RPL is in between with the added benefit of unique tokenomics and a decentralizing staking mechanism. Relative valuations are rational which suggests to us the market is efficiently pricing the different opportunities. We have elected to own all three. We believe the LSD tokens are the highest EV Merge-related investments! They will likely outperform ETH, but investors should expect higher volatility and lower liquidity. The Merge Is Coming The Ethereum Merge is coming. There’s no doubt about it. With the date locked in for September 15th or 16th, this will be the biggest structural change in the history of crypto. There are a lot of dynamics at play that investors need to consider. Hopefully, this report helps you parse through all the information. What’s the key takeaway? The Merge is not priced in. * * * Tyler Durden Fri, 08/19/2022 - 09:58.....»»

Category: blogSource: zerohedgeAug 19th, 2022

London Heathrow Airport boss says airlines are the ones to blame for travel chaos because they slashed baggage-handling jobs and underpay workers

Over half of ground handlers across Europe have left the industry since the pandemic started, wrote Lord Paul Deighton, chairman of London's Heathrow Airport. The aviation industry is dealing with a messy summer travel season as demand has returned to pre-pandemic levels — but staffing has not.Paul Ellis/AFP/Getty Images London Heathrow Airport's chairman, Lord Paul Deighton, blamed airlines for the travel chaos. Airlines cut ground-handling staff during the pandemic and aren't able to replace them now, he said. That's because airlines aren't willing to pay market rates for the wages of baggage handlers, he said. The chairman of London Heathrow Airport has hit back at airlines blaming the aviation hub for the travel chaos.Airlines have not managed to recruit enough ground handlers because they are underpaying them, Lord Paul Deighton wrote in the Telegraph on Tuesday. Such workers handle a wide range of jobs in airports from check-in to loading and unloading bags."It is a highly competitive, labor intensive, low margin business, characterized by short-term contracts. Airlines have driven down costs over the years, and this was one of the first costs they slashed during the pandemic," Deighton wrote.As a result, over half of ground handlers across Europe have left the industry and many with driving skills have been snapped up as delivery drivers, he added. Ground-handling companies are trying to fill the positions, "but if their airline customers won't pay market rates, then they aren't able to fill the posts," Deighton wrote.Heathrow has been asking airlines to meet demand with adequate ground-handling staff, but "in the last few weeks, we have seen a shocking increase in planes departing without bags and passengers having flights canceled after they were already on board," he added.Deighton's defense of Heathrow Airport came on the back of criticism from airlines as the airport has capped how many passengers can fly out from the facility in a day in order to contain the chaos. A global aviation hub, Heathrow was the busiest airport in Europe before the pandemic.Dubai-based airline Emirates at first straight out rejected Heathrow's request to limit summer ticket sales, calling the demand "entirely unreasonable and unacceptable," according to a statement on July 14. It agreed to cap ticket sales a day later after a meeting with the airport.Akbar Al Baker, the CEO of Qatar Airways, also questioned the airport's new measures. "Heathrow has the right to restrict your flight because they cannot overload their facilities," he said on Monday, according to Reuters. "But my question to the management would be, they should have seen this coming and they should have taken mitigating actions."Willie Walsh, the director general of the International Air Transport Association, also blamed Heathrow. "I am surprised Heathrow have not been able to get their act together better than this," Walsh told Reuters on Tuesday.The aviation sector is dealing with a messy summer travel season with flight delays, lost bags, and chaos across the industry — and particularly in Europe — as demand has returned to pre-pandemic levels. Issues faced by airlines include staff shortages and bad weather.Read the original article on Business Insider.....»»

Category: worldSource: nytJul 21st, 2022

What Is Adam Schiff Hiding?

What Is Adam Schiff Hiding? Authored by Julie Kelly via AmGreatness.com, Schiff tucked an amendment into the National Defense Authorization Act that would prohibit any evidence collected in violation of the Posse Comitatus Act from being used in investigations. Why? Jeffrey Rosen had a secret on January 6, 2021. The then-acting attorney general—Rosen was appointed on December 24, 2020 to replace departing Attorney General William Barr—had assembled a team of elite and highly skilled government agents at Quantico, a nexus point between the FBI and U.S. military, the weekend before Congress met to certify the results of the 2020 presidential election. At the same time he was rejecting President Donald Trump’s last-minute appeals to investigate election fraud, Rosen was managing a hush-hush operation in advance of planned rallies and protests in Washington on January 6. “Rosen made a unilateral decision to take the preparatory steps to deploy Justice Department and so-called ‘national’ forces,” Newsweek reporter William M. Arkin disclosed in a bombshell report earlier this year. “There was no formal request from the U.S. Capitol Police, the Secret Service, or the Metropolitan Police Department—in fact, no external request from any agency. The leadership in Justice and the FBI anticipated the worst and decided to act independently, the special operations forces lurking behind the scenes.” Those assets, according to Arkin, included “commandos” with shoot-to-kill authority. And among them were members of the military.  “The presence of these extraordinary forces under the control of the Attorney General—and mostly operating under contingency plans that Congress and the U.S. Capitol Police were not privy to—added an additional layer of highly armed responders,” Arkin writes. “The role that the military played in this highly classified operation is still unknown, though FBI sources tell Newsweek that military operators seconded to the FBI, and those on alert as part of the National Mission Force, were present in the metropolitan area.” Little else is known about Rosen’s secret mission. His testimony to the House Oversight Committee in May 2021 was just as obscure. Rosen, who publicly bragged to the January 6 select committee about his attempts to deter Team Trump from pursuing vote fraud days before the Capitol protest, said the FBI opened a multi-agency operation center, which included the Department of Defense, at FBI headquarters on January 5. “Each of these federal agencies supplied personnel to staff the [center] 24/7 beginning on January 5 and 6, and continuing for a period thereafter,” he said. To avoid “interfering” in ongoing investigations, Rosen then declined to answer any questions from lawmakers at the time. But if the military engaged in any civilian law enforcement activity, including surveillance or intelligence collection, before or during January 6, it would represent an egregious violation of the military’s code of conduct and federal law. Under the Posse Comitatus Act, military personnel cannot be used as local cops or investigators: “Whoever, except in cases and under circumstances expressly authorized by the Constitution or Act of Congress, willfully uses any part of the Army, the Navy, the Marine Corps, the Air Force, or the Space Force as a posse comitatus or otherwise to execute the laws shall be fined under this title or imprisoned not more than two years, or both.” (Certain exclusions, such as the president’s invocation of the Insurrection Act and any use of the National Guard, apply.) The law is both vague and specific at the same time—which brings us to Representative Adam Schiff (D-Calif.). Irrefutably the least trustworthy member of Congress, Schiff tucked an amendment into the massive National Defense Authorization Act that would prohibit any evidence collected in violation of the Posse Comitatus Act from being used in a number of proceedings, including criminal trials and congressional investigations. The amendment’s timing, like everything else related to the infamous Russian collusion huckster, evidence forger, and nude photo seeker (to name a few of Schiff’s special talents), is highly suspect. Why would Schiff need to outlaw evidence collected unlawfully? Why is Schiff relying on this relatively arcane statute passed during Reconstruction that is rarely, if ever, enforced?  “No one has ever been convicted of violating PCA to my knowledge,” Dr. Jeffrey Addicott, a 20-year member of the Judge Advocate General’s Corps and director of the Warrior Defense Project at St. Mary’s College, told American Greatness last week. What is Adam Schiff, on behalf of the Biden regime and Trump foes in the U.S. military, including Chairman of the Joint Chiefs of Staff Mark Milley, trying to hide? It is not a coincidence that Schiff introduced the amendment just a few months before a predicted Republican landslide in November, which will give control of Congress back to the GOP. House Minority Leader and presumptive Speaker of the House Kevin McCarthy is planning to conduct multiple investigations into the Biden regime next year including of the deadly and distrastrous withdrawal from Afghanistan; the Daily Caller reported this week that Republican lawmakers are “flooding the Biden administration with ‘hundreds of preservation notices’ asking that relevant documents be preserved.” But one can easily see how Schiff’s amendment could be used as legislative cover to prevent production of any materials from Biden’s Department of Defense. After all, according to a 2018 congressional analysis of Posse Comitatus, “compliance [of the act] is ordinarily the result of military self-restraint.” So, too, is enforcement: “The act is a criminal statute under which there has been but a handful of known prosecutions,” the same report explained. This is the sort of vehicle that Democrats know how to use and exploit for political advantage. If interpretation and enforcement is totally arbitrary, who decides? Defense Secretary Lloyd Austin? The Justice Department? Biden’s White House lawyers?  Imagine how Democrats could conceal the use of military personnel related to the events of January 6. Congressional Republicans send a request to Austin seeking all records, documents, and communications pertaining to the military’s involvement before and during the Capitol protest. Austin replies that he has determined the military—under control of President Trump at the time, no less—violated Posse Comitatus and therefore the requested materials cannot be produced under authority of the Schiff amendment. Republicans can howl and scream but they have no legal remedy. Austin won’t investigate and Attorney General Merrick Garland won’t prosecute. This scenario could be repeated for every Republican inquiry into Biden’s Defense Department. Does anyone really think this regime will hand over information to GOP investigators and committees without pulling every trick in the book, starting with Schiff’s amendment? On Thursday afternoon, the House narrowly passed Schiff’s amendment by a vote of 215-213; every Republican and two Democrats voted no. (House Speaker Nancy Pelosi came to the floor to vote in a rare move.) Passage in the Senate is uncertain. If his amendment fails to advance, Schiff nonetheless has done Republicans a tremendous favor; he’s tipped off the GOP that there’s plenty of digging to be done at the Department of Defense, where a trove of scandals awaits political sunshine. Republicans would be wise to take his cue—and start with January 6. Tyler Durden Sun, 07/17/2022 - 15:30.....»»

Category: blogSource: zerohedgeJul 17th, 2022

Sodexo: First half Fiscal 2022 Results up strongly

Revenue growth +19.4%, despite Omicron, organic growth +16.7% Underlying operating profit doubled, H1 margin at 5.2%, up +210 bps Fiscal 2022 guidance Organic revenue growth around the bottom of the range of +15% to +18% Underlying operating profit margin close to 5%1, at constant rates Issy-les-Moulineaux, April 1, 2022 - Sodexo (OTC:SDXAY). At the Board of Directors meeting held on March 31, 2022, and chaired by Sophie Bellon, the Board closed the Consolidated accounts for the First half Fiscal 2022 ended February 28, 2022. Financial performance for First half Fiscal 2022 (in millions of euro) H1 FISCAL 2022 H1 FISCAL 2021 DIFFERENCE DIFFERENCE CONSTANT RATES Revenue 10,262 8,595 +19.4% +15.9% UNDERLYING OPERATING PROFIT 538 265 +103.0% +96.2% UNDERLYING OPERATING PROFIT MARGIN 5.2% 3.1% +210 bps +210 bps Other operating expenses (1) (128) -99.2% -100.9% OPERATING PROFIT 537 136 +294.9% +279.5% Net financial expense (53) (50)     Tax charge (136) (53)     Effective tax rate 28.3% 63.0%     GROUP NET PROFIT 337 33 x10 x10 EPS (in euro) 2.30 0.23 x10   UNDERLYING NET PROFIT 339 128 +164.8% +156.0% UNDERLYING EPS (in euro) ² 2.32 0.87 +165.3%   Sodexo Chairwoman and CEO Sophie Bellon said: "Revenue growth and margins improvement have been strong in this First half, reflecting the solid recovery in Education, Corporate Services and Sports & Leisure segments. Omicron did have an impact on the recovery in the second quarter, but we are seeing a pick-up since the end of February. We have closed the GET efficiency program, with better results than anticipated. The teams mobilized actively to implement measures to mitigate rising cost inflation: indexation, client negotiations, productivity, product substitution. These actions resulted in a +210 bps improvement of our Underlying operating profit margin to 5.2%. Since October 2021, we have made significant progress on our strategic priorities. Operational execution and sales development are improving in the United States. More new food model offers are being deployed in our major geographies. Our disposals and acquisitions are fully aligned with our portfolio strategy. The transfer of the management of Schools and Government & Agencies to the regions is a first step in the simplification of our organization. In the second half of the year, we are confident that the return to the workplace and Sports & Leisure events will continue to recover. However, the environment remains uncertain with intermittent local outbreaks of Covid-19, and the war in Ukraine. We are confident that we can manage the year end inflationary pressure on margins. Currencies should give us a nice tailwind, but we expect organic revenue growth to be around the bottom of the range we had given in October 2021. Our teams are mobilized to meet the challenges and I warmly thank them for their impressive engagement in the field with our clients and our suppliers. We remain confident in our capacity to continue to grow our business." Highlights of the period First half Fiscal 2022 Group revenue was 10,262 million euro, up +19.4%, with strong recovery coming through in all segments that were severely impacted by Covid. The currency effect was strong at +3.5%, resulting from the strength of all our major currencies against the euro. The net M&A contribution was -0.8% due to the exit of businesses, sold as part of the portfolio management program. As a result, Group organic revenue growth was +16.7%, back up to 95% of pre-Covid levels. On-site Services organic revenue growth was +17.0%, with a particularly strong first quarter up +17.9% and a second quarter at +16.1%, impacted by Omicron. The recovery was solid with the first quarter ending at 95 % of pre-Covid levels but falling back slightly to 94% in the second quarter due to Omicron. The key elements of the half-year were: In Business & Administrations, organic growth was +19.5%. It reflects a strong recovery in Corporate Services, back up to 89% of pre-Covid levels in Q2, due to a gradual but regular return to the workplace. Sports & Leisure is back up to 61%, as the number of events has picked up significantly. Energy & Resources and Government & Agencies remained solid. In Healthcare & Seniors, organic growth was +5.0%, with the first quarter up +7.4% and the second quarter up +2.5% reflecting a much tougher comparative base in Europe, including a high level of activities at the Testing Centers contract in the United Kingdom last year. In Education, organic growth was +29.5%. While the recovery in activity in Universities in North America was very strong during the period, Omicron did have an impact on the growth in the second quarter in Schools in North America and Europe. Relative to pre-Covid levels, Education was at 88% in the second quarter, back down from 92% in the first quarter, impacted also by the full effect of the Chicago Public Schools contract termination. Key Performance Indicators for the First half Fiscal 2022: Client retention was up +60 bps to 98.1%, improving in all regions and segments. New sales development was up +90 bps at 3.7%, with improvements in many regions, including North America. The higher levels of signings were combined with continued signing discipline, particularly regarding the average projected gross margin which is up +80 bps. Same site sales growth recovered strongly at +19.8%, as volume recovery came through, helped by some solid cross-selling in many segments and regions. Benefits & Rewards Services organic growth was +9.3%, with Employee benefits up a strong +14.5%. There was an acceleration in the second quarter in both the Europe, USA and Asia region and Latin America, where Brazil is also back to double digit growth. Underlying operating margin was 5.2%, up +210 bps versus First half Fiscal 2021. This significant improvement in performance is the result of the strong recovery in volumes, the successful completion of the GET efficiency program, and strong actions to mitigate inflation through indexation, contract renegotiations and productivity. Other operating expenses (net) amounted to only 1 million euros in First half Fiscal 2022, with restructuring costs falling to 3 million euros and gains on the sale of assets more or less off-setting losses. This compares to 128 million euros in the previous year. The Effective tax rate at 28.3% fell below 30%, back to a more regular rate. Group net profit recovered significantly at 337 million euros against 33 million euros in the previous year. Basic EPS was thus multiplied by 10 at €2.30 against €0.23 in the previous year. Underlying Net profit increased +164.8% to 339 million euros against 128 million euros in the previous year. First half Fiscal 2022 Free cash outflow was 75 million euros against the cash inflow of 237 million euros in the previous period. The previous year was boosted by delayed restructuring costs and government payment delays. This year performance was marred by the unwinding of these same government payment delays and restructuring costs combined with the reimbursement of Tokyo Olympics ticketing and an exceptional contribution to the United Kingdom pension funds. Recurring free cash flow was 182 million euros, after a significant increase in capex to 159 million euros, or 1.5% of revenues, relative to the exceptionally low level of 86 million euros, or 0.9% of revenues in the previous year. Net debt has risen year on year to 2.0 billion euros from 1.7 billion euros. However, gearing2 is stable at 56% and as a result of the significant improvement in EBITDA, the net debt ratio2 has fallen back down to 1.8x compared to 3.8x at the end of First half Fiscal 2021. Once again, our Corporate Responsibility achievements have been externally recognized: Sodexo earns its 15th consecutive 100 on the Human Rights Campaign Foundation's annual assessment of LGBTQ+ workplace equality. Sodexo is ranked #1 of the food service sector in World Benchmarking Alliance's (WBA) first Food and Agriculture Benchmark, which measures how the world's 350 most influential companies in the industry are transforming the food system for a more sustainable future. In February 2022, Sodexo was awarded Supplier Engagement Leader by CDP, placing us in the 8% top companies taking action to measure and reduce environmental risks within its supply chain. Strategic priorities    Boost US growth: Sales momentum is developing with robust new development, an increase in the active pipeline, which should support stronger sales in the second half and solid retention. First time outsourcing contract signings are increasing and currently represent circa 40% of signatures in the First half. Investment in the Marketing & Sales resources is continuing with additions of new sales executives and managers and the recent launching of a new digital training program. A specific long-term incentive scheme for the North America leadership team has been launched to strengthen collective and individual accountability.   Accelerate the food model transformation: The deployment of On-site brands & offers is accelerating with the scale-up of The Good Eating Company in the United States and new contracts signatures in the tech and finance sectors for Nourish, Fooditude and The Good Eating Company. We are developing partnerships with high-end brands such as an exclusive 10-year partnership with ForFive Coffee, a premium coffee and food company based in New York. The digitalization of the consumer experience is also progressing. In China, we are leveraging the Meican digital online ordering, mobile apps, smart waiter… to enhance the food offer and develop new smaller clients. We have signed an agreement to expand the Kiwibot fleet in 50 US universities by the end of the year. We are progressively transforming production & logistics: with our new branded offsite kitchens such as Fooditude, Nourish, Frontline Food Services but also with our new central production units in Boston or in Beijing. Manage more actively our portfolio: A number of strategic acquisitions & investments have been completed during the period: To expand the New Food Model offerings, we have acquired Frontline Food Services in North America and increased our participation in Meican in China. To strengthen our European GPO (Group purchasing organization), two investments have been made in Europe. To enhance our value-added offers in Healthcare, a Technical Equipment management service company has been acquired in China. Divestment of non-core activities and geographies have also accelerated in the First half. In On-site Services, subsidiaries in Morocco, non-strategic account portfolios in Australia and Czech Republic and The Lido in France have all been sold. Benefits & Rewards Services disposed of its Russian activity and also the sports-cards in Romania and Spain. The Global Childcare activities and On-site Services in the Congo were closed in March. As a result, the Group has now reduced its presence down to 55 countries at the end of February 2022. Enhance the effectiveness of our organization: The GET efficiency program closed ahead of plan with 382 million euros of savings against the target of 350 million euros and a savings/cost ratio of 117% versus 100%. The reorganization of Government & Agencies and Education to be managed regionally has simplified the organization, and as a result two Global CEO positions have been removed from the Executive Committee. In the Executive Committee, Annick de Vanssay, interim Chief People Officer since September 2021, is now appointed as Group Chief Human Resources Officer and Alexandra Serizay, previously Chief of Staff of Sophie Bellon, is appointed Group Chief Strategy Officer. Ukraine war Sodexo does not have activities in Ukraine. Sodexo has a small On-site presence in Russia: less than 1% of Group revenues. The situation is being monitored closely and we are reviewing different options at the moment. From the beginning of the war, Sodexo has been strongly mobilized to ensure business continuity for its clients, guarantee the safety of its employees, and provide support to the refugees in countries bordering Ukraine. Sodexo Group and Stop Hunger have set up a Sodexo Employee Donations Global Initiative with the support of their long-term partner, the United Nations World Food Programme (WFP). Employee donations are matched by Sodexo and the money raised will be used to support refugees in the region and people affected by the war in Ukraine. Outlook The First half Fiscal 2022 benefited from a strong recovery, post-Covid, in the Corporate Services, Sports & Leisure and Education segments but it was also impacted by Delta and Omicron in the second quarter. Since the end of February, momentum is picking back up. However, the current environment remains full of uncertainties. There is a resurgence of localized Covid outbreaks, several mobilizations in Russia will not happen, and the Testing Centers in the United Kingdom are closing earlier than expected. As a result, we expect Fiscal 2022 organic growth to be around the bottom of the range of +15% to +18% given in October 2021. The currencies provided a strong tailwind in the First half and, at today's rates, should continue to do so. Our teams have successfully managed the margins in the First half and are highly mobilized to mitigate all these uncertainties and in particular the additional inflation resulting from the disruption to the supply chain due to the Ukraine war. As a result, we maintain our expectations for Fiscal 2022 Underlying Operating Profit margin close to 5%3, at constant rates.   Conference call Sodexo will hold a conference call in (English) today at 9:00 a.m. (Paris time), 8:00 a.m. (London time) to comment on its H1 Fiscal 2022 results. Those who wish to connect: From the United Kingdom: +44 2071 928 338, or From France: +33 1 70 70 07 81, or From the US: +1 646-741-3167,Following by the access code 92 69 446 A live audio webcast is also available on www.sodexo.com. The press release, presentation and webcast will be available on the Group website www.sodexo.com in both the « Latest News » section and the « Finance – Financial Results » section. Fiscal 2022 financial calendar Fiscal 2022 Third quarter Revenues July 1, 2022 Fiscal 2022 Annual Results October 26, 2022 Fiscal 2022 Annual Shareholders Meeting December 19, 2022 Please note that the date of the Annual Shareholders Meeting has changed. These dates are indicative and may be subject to change without notice. Regular updates are available in the calendar on our website www.sodexo.com About Sodexo Founded in Marseille in 1966 by Pierre Bellon, Sodexo is the global leader in Quality of Life Services, an essential factor in individual and organizational performance. Operating in 55 countries, our 412,000 employees serve 100 million consumers each day. Sodexo Group stands out for its independence and its founding family shareholding, its sustainable business model and its portfolio of activities including Food Services, Facilities Management Services and Employee Benefit Solutions. We provide quality, multichannel and flexible food experiences, but also design attractive and inclusive workplaces and shared spaces, manage and maintain infrastructure in a safe and environmentally friendly way, offer personalized support for patients or students, or even create programs fostering employee engagement. From Day 1, Sodexo has been focusing on tangible everyday gestures and actions through its services in order to have a positive economic, social and environmental impact over time. For us, growth and social commitment go hand in hand. Creating a better everyday for everyone to build a better life for all is our purpose. Sodexo is included in the CAC Next 20, CAC 40 ESG, FTSE 4 Good and DJSI indices. Key Figures 17.4 billion euro in Fiscal 2021 consolidated revenues 412,000 employees as at August 31, 2021 #1 France-based private employer worldwide 55 countries (as at Feb. 28, 2022) 100 million consumers served daily 10.9 billion euro in market capitalization (as at March 31, 2022) Contacts Analysts and Investors Media Virginia Jeanson+33 1 57 75 80 56virginia.jeanson@sodexo.com Mathieu Scaravetti+33 6 28 62 21 91mathieu.scaravetti@sodexo.com           SODEXOH1 2022 Financial Report   H1 Fiscal 2022 Activity Report 1      First half Fiscal 2022 results up strongly 1.1        H1 Fiscal 2022 operating performance Group revenues reached 10.3 billion euros, up +19.4%. The recovery in revenues continued to be solid in the first quarter of the year as activity in Sports & Leisure, Corporate Services and Education picked up strongly. In the second quarter, recovery stalled due to Omicron in these segments. However, profitability continued to improve in all segments and regions. As a result, First half Fiscal 2022 organic revenue growth reached +16.7%, with an Underlying Operating Profit margin at 5.2%, up +210 bps. Net profit was 337 million euros, up 10 times compared to 33 million euros in First half Fiscal 2021 and 378 million euros in First half Fiscal 2020, pre-Covid. 1.2        New leadership for Sodexo On February 16, 2022, the Group announced that the Board had decided to appoint Sophie Bellon as Chief Executive Officer of Sodexo, a position she has held on to an interim basis since October 1, 2021. After a successful transition phase, the Board considered she was the best placed to lead the Group through this new phase in its history and to maintain the very strong momentum around the four key priorities: Boost US growth Accelerate the food model transformation Manage more actively our portfolio Enhance the effectiveness of our organization Organizational changes Since October 2021, a series of organizational changes have been undertaken. The Schools and Government & Agencies segments are now managed regionally by the Region/Country chair. As a result, the departing CEOs of these segments have not been replaced in the Executive Committee. In addition, changes within the Global Leadership team have been implemented: As of March 1, 2022, Alexandra Serizay, previously Chief of Staff of Sophie Bellon, is appointed Group Chief Strategy Officer, member of the Executive Committee, to replace Sylvia Metayer who is retiring. Alexandra joined Sodexo in 2017 as Global Head of Strategy for the Corporate Services segment. In that role, she worked with the teams across the world to define the Segment's strategic roadmap. She has previously developed solid expertise in M&A at Deutsche Bank, in strategy at Bain & Company, and in operations at HSBC, as COO and then as Deputy Head of retail banking for France, where, among others, she led the transformation to a multichannel model. Annick de Vanssay, interim Chief People Officer since September 2021, has now been appointed as Group Chief Human Resources Officer. Annick has developed a solid and proven expertise in Human Resources throughout her career. Among others, she held several senior positions in Human Resources in Groups such as Orange. During her career, she has contributed to major transformation projects. 1.3        Working towards a Better Tomorrow Once again, our Corporate Responsibility achievements have been externally recognized: Sodexo earns its 15th consecutive 100 on the Human Rights Campaign Foundation's annual assessment of LGBTQ+ workplace equality. Sodexo is ranked #1 of the food service sector in World Benchmarking Alliance's (WBA) first Food and Agriculture Benchmark, which measures how the world's 350 most influential companies in the industry are transforming the food system for a more sustainable future. In February 2022, Sodexo was awarded Supplier Engagement Leader by CDP, placing us in the 8% top companies taking action to measure and reduce environmental risks within its supply chain. 1.4        Evolution of the Board of Directors To ensure balanced governance on the Board following the combining of the Chairwoman and CEO roles, the Board of Directors appointed Luc Messier, a Sodexo director since January 2020, as Lead Independent Director. His main mission is to ensure the proper governance of the company. According to the internal rules of the Board (published on sodexo.com) the Lead Independent Director has the power to: amend the agenda of the Board meetings; bring any situations of conflict of interest to the Board; in coordination with the Chairwoman, is the Board's spokesperson for investors and shareholders on governance issues. In line with the recommendations of the AFEP-Medef code, Sophie Bellon has resigned from the Nominating committee. As of March 1, 2022, the Board Committees are made up as follows: Audit Committee Sophie Stabile, Chairwoman, Independent director Jean-Baptiste Chasseloup de Chatillon, Independent director François-Xavier Bellon, Director Véronique Laury, Independent director Cathy Martin, Director representing employees Nominating Committee Cécile Tandeau de Marsac, Chairwoman, Independent director Luc Messier, Lead Independent director François-Xavier Bellon, Director Nathalie Bellon-Szabo, Director Françoise Brougher, Independent director Compensation Committee Cécile Tandeau de Marsac, Chairwoman, Independent director Philippe Besson, Director representing employees Françoise Brougher, Independent director Sophie Stabile, Independent director 1.5        Ukraine war impact Sodexo does not have activities in Ukraine. Sodexo has a small On-site presence in Russia: less than 1% of our revenues. The situation is being monitored closely and we are reviewing different options at the moment. From the beginning of the war, Sodexo has been strongly mobilized to ensure business continuity for its clients, guarantee the safety of its employees, and provide support to the refugees in countries bordering Ukraine. Sodexo Group and Stop Hunger have set up a Sodexo Employee Donations Global Initiative with the support of their long-term partner, the United Nations World Food Program (WFP). Employee donations are matched by Sodexo and the money raised will be used to support refugees in the region and people affected by the war in Ukraine. 2      H1 Fiscal 2022 performance 2.1        Consolidated income statement (in millions of euros) H1 FISCAL 2022 H1 FISCAL 2021 DIFFERENCE DIFFERENCE CONSTANT RATES Revenue         10,262                 8,595                 +19.4%                 +15.9%         UNDERLYING OPERATING PROFIT         538                 265                 +103.0%                 +96.2%         UNDERLYING OPERATING PROFIT MARGIN         5.2%                 3.1%         +210 bps         +210 bps         Other operating expenses         (1)                 (128)             OPERATING PROFIT         537                 136                 +294.9%                 +279.5%         Net financial expense         (53)                 (50)             PRE-TAX PROFIT excluding share of profit from Equity method companies         484                 86             Tax charge         (136)                 (53)             Effective tax rate 28.3%         63.0%             GROUP NET PROFIT         337                 33         x10         x10         EPS (in euros)         2.30                 0.23         x10           UNDERLYING NET PROFIT         339                 128                 +164.8%                 +156.0%         Underlying EPS (in euros)         2.32                 0.87                 +165.3%           2.2        Currency effect Exchange rate fluctuations do not generate operational risks, because each subsidiary bills its revenues and incurs its expenses in the same currency. However, given the weight of the Benefit & Rewards activity in Brazil, and the high level of its margins relative to the Group, when the Brazilian real declines against the euro, it has a negative effect on the Underlying Operating Profit margin due to a change in the mix of margins. Conversely, when the Brazilian real strengthens Group margins increase. 1€= AVERAGE RATE H1 FY 2022 AVERAGE RATE H1 FY 2021 AVERAGE RATE H1 FY 2022 VS. H1 FY 2021 CLOSING RATE AT 28/02/2022 CLOSING RATE AT 31/08/21 CLOSING RATE28/02/2022 VS. 31/08/2021 U.S. dollar         1.143         1.197         +4.7%         1.120         1.183         +5.7% Pound Sterling         0.846         0.897         +6.1%         0.836         0.859         +2.8% Brazilian real         6.258         6.554         +4.7%         5.783         6.139         +6.2% The positive contribution of currencies in First half Fiscal 2022 is the result of the recent weakness of the euro against all our main currencies with an increase in the U.S. dollar and the Brazilian real of +4.7% and sterling of +6.1% cumulating in a +3.5% positive impact on revenues and no impact on the Underlying Operating Profit margin. Sodexo operates in 55 countries. The percentage of total revenues and Underlying Operating Profit denominated in the main currencies are as follows: FISCAL 2022 % OF REVENUES % OF UNDERLYING OPERATING PROFIT U.S. dollar         39        %         51        % Euro         24        %         -2        % UK pound Sterling         10        %         10        % Brazilian real         4        %         14        % The currency effect is determined by applying the previous year's average exchange rates to the current year figures. 2.3        Revenues REVENUES BY ACTIVITY REVENUES(in millions of euros) H1 FY 2022 H1 FY 2021   RESTATED ORGANIC GROWTH ORGANIC GROWTH EXTERNAL GROWTH CURRENCY EFFECT TOTAL GROWTH Business & Administrations         5,160                 4,280                   +19.5        %         +19.6        %         -2.0        %         +3.0        %         +20.6        % Healthcare & Seniors         2,675                 2,338                   +5.0        %         +9.8        %         +0.7        %         +4.0        %         +14.5        % Education         2,030                 1,620                   +29.5        %         +20.7        %         -0.2        %         +4.8        %         +25.3        % ON-SITE SERVICES         9,865                 8,238                   +17.0        %         +17.0        %         -0.9        %         +3.6        %         +19.8        % BENEFITS & REWARDS SERVICES         398                 359                   +9.3        %         +9.3        %         +0.5        %         +1.0        %         +10.8        % Elimination         (1)                 (2)                     TOTAL GROUP         10,262                 8,595                   +16.7        %         +16.7        %         -0.8        %         +3.5        %         +19.4        % First half Fiscal 2022 consolidated revenues were at 10.3 billion euros, up +19.4% year-on-year including a negative net contribution from acquisitions and disposals of -0.8% and a strong currency impact of +3.5%. Excluding these elements, organic revenue growth was +16.7%. ON-SITE SERVICES On-site Services organic revenue growth was +17.0% for the period, with a solid recovery up to the end of December, an Omicron impact in Q2 in Corporate Services, Sports & Leisure and Education, and a visible improvement by the end of February. As a result, the second quarter, at 94% of pre-Covid Fiscal 2019 revenues at constant rates, was slightly below the first quarter at 95%, but still well above the levels of Fiscal 2021. The performance of the main segments relative to Fiscal 2019 revenues is as follows: AT CONSTANT RATES in % of Fiscal 2019 revenues Q3 FY 2020 Q4 FY 2020 Q1 FY 2021 Q2 FY 2021 Q3 FY 2021 Q4 FY 2021 Q1 FY 2022 Q2 FY 2022 Business & Administrations         71        %         70        %         78        %         78        %         78        %         82        %         91        %         91        % Of which Corporate Services         73        %         74        %         79        %         78        %         75        %         79        %         87        %         89        % Of which Sports & Leisure         16        %         9        %         14        %         17        %         22        %         43        %         64        %         61        % Education         46        %         64        %         72        %         68        %         79        %         85        %         92        %         88        % Of which Schools         52        %         78        %         87        %         84        %         88        %         99        %         104        %         92        % Of which Universities         41        %         52        %         61        %         54        %         72        %         71        %         84        %         84        % Healthcare & Seniors         88        %         92        %         97        %         100        %         96        %         100        %         105        %         104        % On-site Services         70        %         75        %         81        %         81        %         83        %         87        %         95        %         94        % Benefits & Rewards Services         77        %         95        %         100        %         94        %         96        %         97        %         107        %         106        % Group         70        %         75        %         81        %         82        %         83        %         87        %         95        %         94        % During the first half of Fiscal 2022, the Food services activity recovered strongly, up +27% in line with the recovery in Education and Sports & Leisure segments. Facilities Management services continued to grow, up +5% year on year despite the impact of the termination of the Chicago Public Schools contract and lower activity in the Testing Centers in the second quarter. By the end of the second quarter, Food services were back up to 82% of pre-Covid levels. The lower level in FM services at 112% at the end of the second quarter was due to the full effect of the Chicago Public Schools contract termination, significant volatility in the Testing Centers activity between the first and second quarters and a base effect linked to acquisitions consolidated from the second quarter Fiscal 2019. Key performance indicators have improved across the board during the First half Fiscal 2022: client retention was 98.1%, up +60 bps compared to First half Fiscal 2021 with improvements in all segments and regions. new sales development was up +90 bps at 3.7%, with a solid contribution from Business & Administrations and Healthcare & Seniors. Education is also up but is less significant due to the seasonality of the new business decisions which tend to be taken at the end of the academic year. This increase in development is accompanied by an +80bps improvement in expected gross margins. same site sales were up +4,250 bps at +19.8%, thanks to the strong volume recovery in Corporate Services, Sports & Leisure and Education and solid cross-selling particularly in Healthcare & Seniors. ON-SITE SERVICES REVENUES BY REGION REVENUES BY REGION(in millions of euros) H1 FY 2022 H1 FY 2021 ORGANIC GROWTH North America         4,232                 3,174                 +27.1        % Europe         3,917                 3,528                 +10.6        % Asia-Pacific, Latam, Middle East and Africa         1,716                 1,535                 +11.0        % ON-SITE SERVICES TOTAL         9,865                 8,238                 +17.0        % The +27.1% organic growth in North America in the First half reflects the reopening of all schools and universities and Sports & Leisure sites, and a slow return to work. The region is still only at 85% of pre-Covid levels due to the significant weight of Sports & Leisure and Corporate Services in the mix of business. Europe was up +10.6% reflecting continued recovery in the region, which in the First half Fiscal 2022 was back up over 95% of pre-Covid levels. Asia-Pacific, Latin America, Middle East and Africa grew organically by +11.0% and now running at 21% above pre-Covid levels. FOR THE SECOND QUARTER ONLY REVENUES BY REGION(in millions of euros) Q2 FY 2022 Q2 FY 2021 ORGANIC GROWTH North America         2,026                 1,486                 +25.8        % Europe         1,895                 1,721                 +10.0        % Asia-Pacific, Latam, Middle East and Africa         862                 767                 +10.5        % ON-SITE SERVICES TOTAL         4,783                 3,974                 +16.1        % Growth in the second quarter Fiscal 2022 slowed slightly in all regions relative to the first quarter, due to an ever-improving comparable base. While the recovery in Europe was impacted by Omicron, from 98% of pre-Covid levels in the first quarter to 93% in the second quarter, the recovery continued in North America up +1% to 86% of pre-Covid levels in the second quarter. Business & Administrations REVENUES BY REGION(in millions of euros) H1 FY 2022 H1 FY 2021 RESTATED ORGANIC GROWTH North America         1,263                 828                 +45.2        % Europe         2,354                 2,084                 +15.1        % Asia-Pacific, Latam, Middle East and Africa         1,542                 1,369                 +10.8        % BUSINESS & ADMINISTRATIONS TOTAL         5,160                 4,280                 +19.5        % First half Fiscal 2022 Business & Administrations revenues totaled 5.2 billion euros, up +19.5% organically. FOR THE SECOND QUARTER ONLY REVENUES BY REGION(in millions of euros) Q2 FY 2022 Q2 FY 2021 RESTATED ORGANIC GROWTH North America         620                 405                 +41.8        % Europe         1,146                 1,004                 +16.8        % Asia-Pacific, Latam, Middle East and Africa         776                 687                 +10.3        % BUSINESS & ADMINISTRATIONS TOTAL         2,543                 2,095                 +19.5        % Second quarter organic growth in North America was +41.8% due to a solid recovery in activity in Corporate services and Sports & Leisure. While the first benefited from a continued although very slow return to work, the rebound in the Sports & Leisure activity stalled in the second quarter due to the impact of Omicron. On the other hand, Energy & Resources segment growth accelerated during the period due to new contract startups and return of support workers onsite. In Europe, second quarter revenues were up +16.8% organically, boosted by a solid recovery in Corporate Services and Sports & Leisure, although the recovery stalled due to the protective measures put in place for Omicron. On the other hand, the contribution from new contracts in the Government & Agencies and Energy & Resources segments was not enough to compensate the loss of the Transforming Rehabilitation contract in the UK. In Asia-Pacific, Latam, Middle East and Africa, organic revenue growth was +10.3%. The Corporate Services segment continued to grow double digit as activity picked up strongly in India and remained strong in all other regions. Energy & Resources continued to achieve very solid growth. New business ramp-ups and strong underlying growth in the energy sector compensated some contract losses. Healthcare & Seniors REVENUES BY REGION(in millions of euros) H1 FY 2022 H1 FY 2021 RESTATED ORGANIC GROWTH North America         1,424                 1,297                 +4.7        % Europe         1,114                 910                 +4.8        % Asia-Pacific, Latam, Middle East and Africa         137                 131                 +9.6        % HEALTHCARE & SENIORS TOTAL         2,675                 2,338                 +5.0        % Healthcare & Seniors First half revenues amounted to 2.7 billion euros, up +5.0% organically. FOR THE SECOND QUARTER ONLY REVENUES BY REGION(in millions of euros) Q2 FY 2022 Q2 FY 2021 RESTATED ORGANIC GROWTH North America         730                 643                 +5.2        % Europe         537                 467                 -1.5        % Asia-Pacific, Latam, Middle East and Africa         70                 66                 +9.2        % HEALTHCARE & SENIORS TOTAL         1,337                 1,177                 +2.5        % In North America, organic growth was +5.2%, helped by some inflation and ongoing recovery in Seniors occupancy. Hospital activity has been growing in volume, but retail activity is still at only 70% of pre-Covid levels. In Europe, organic growth was -1.5%, impacted by a significant volatility in activity in the Testing centers from quarter to quarter and year to year. Seniors occupancy continues to pick up progressively. In Asia-Pacific, Latam, Middle East and Africa, organic revenue growth was +9.2%, due to strong volume growth related to new contracts in Asia and same-site growth in Brazil. Education REVENUES BY REGION(in millions of euros) H1 FY 2022 H1 FY 2021 RESTATED ORGANIC GROWTH North America         1,545                 1,050                 +40.4        % Europe         449                 535                 +3.1        % Asia-Pacific, Latam, Middle East and Africa         36                 35                 +27.7        % EDUCATION TOTAL         2,030                 1,620                 +29.5        % First half Fiscal 2022 revenues in Education were 2.0 billion euros, up +29.5% organically. FOR THE SECOND QUARTER ONLY REVENUES BY REGION(in millions of euros) Q2 FY 2022 Q2 FY 2021 RESTATED ORGANIC GROWTH North America         676                 438                 +41.2        % Europe         212                 250                 +6.6        % Asia-Pacific, Latam, Middle East and Africa         16                 14                 +26.5        % EDUCATION TOTAL         904                 703                 +30.6        % In the second quarter, North America was up +41.2% with all schools and colleges open during the quarter. The recovery did stall in the second quarter compared to the first quarter due to Omicron and the full impact of the Chicago Public Schools contract termination. In Universities, Board plans are nearly back up to Fiscal 2019 levels. However, the retail and events activities were impacted by staff shortages, lower footfall, and sanitary protocols. In Europe, revenue was up +6.6% organically. Schools were fully open, against a previous year which had been impacted by confinement in the UK. However, student attendance rates were still below normal levels due to the number of cases of Omicron during the quarter. In Asia-Pacific, Latam, Middle East and Africa, organic growth was +26.5% reflecting very rapid ramp-up in student attendance in India, particularly in universities. BENEFITS & REWARDS SERVICES First half Fiscal 2022 Benefits & Rewards Services revenue amounted to 398 million euros, up +9.3% organically. Employee Benefits organic growth was back up to double digit at +14.5% compared to an issue volume up +13.3%. Services Diversification was down -7.6% organically. REVENUES BY ACTIVITY(in millions of euros) H1 FY 2022 H1 FY 2021 ORGANIC GROWTH Employee Benefits         324                 275                 +14.5        % Services Diversification*         73                 84                 -7.6        % BENEFITS & REWARDS SERVICES         398                 359                 +9.3        % * Including Incentive & Recognition, Mobility & Expenses and Public Benefits. FOR THE SECOND QUARTER ONLY REVENUES BY ACTIVITY(in millions of euros) Q2 FY 2022 Q2 FY 2021 ORGANIC GROWTH Employee Benefits         177                 145                 +18.9        % Services Diversification*         39                 45                 -12.8        % BENEFITS & REWARDS SERVICES         215                 190                 +11.4        % * Including Incentive & Recognition, Mobility & Expenses and Public Benefits. In the second quarter, the organic growth in Employee Benefits revenues was very strong at +18.9%, compared to an organic growth in issue volume of +17.4% boosted by particularly strong gift activity. Services Diversification was down -12.8% organically. While fuel and mobility cards activity grew double digit, this was more than offset by a substantial reduction in Covid-related public benefits. REVENUES BY REGION(in millions of euros) H1 FY 2022 H1 FY 2021 ORGANIC GROWTH Europe, USA and Asia         267                 242                 +9.9        % Latin America         131                 116                 +8.2        % BENEFITS & REWARDS SERVICES         398                 359                 +9.3        %   FOR THE SECOND QUARTER ONLY REVENUES BY REGION(in millions of euros) Q2 FY 2022 Q2 FY 2021 ORGANIC GROWTH Europe, USA and Asia         147                 130                 +12.5        % Latin America         68                 60                 +9.1        % BENEFITS & REWARDS SERVICES         215                 190                 +11.4        % In the second quarter, Europe, USA and Asia, organic revenue growth was +12.5% boosted by very strong growth in issue volume in Israel and Turkey. In Latin America, organic growth was +9.1%, boosted by a return to high single digit growth in Brazil, on double digit growth in Issue volumes. Growth remained solid in the rest of the region. REVENUES BY NATURE(in millions of euros) H1 FY 2022 H1 FY 2021 ORGANIC GROWTH Operating Revenues         375                 339                 +8.9        % Financial Revenues         23                 20                 +16.6        % BENEFITS & REWARDS SERVICES         398                 359                 +9.3        % First half Fiscal 2022 Operating revenues were up +8.9% and Financial revenues were up +16.6%. FOR THE SECOND QUARTER ONLY REVENUES BY NATURE(in millions of euros) Q2 FY 2022 Q2 FY 2021 ORGANIC GROWTH Operating Revenues         203                 180                 +10.6        % Financial Revenues         12                 11                 +25.5        % BENEFITS & REWARDS SERVICES         215                 190                 +11.4        % In the second quarter, Operating revenues were back up to double digit growth at +10.6%, boosted in particular by much better momentum in Brazil and a very strong year end season for gift cards. Financial revenues were up very strongly at +25.5% due to the significant increase in the Selic (official Brazilian interest rate) which is now back up over 11%, having been below 3% 12 months ago. 2.4        Underlying Operating Profit First half Fiscal 2022 Underlying Operating Profit was 538 million euros, more than double the previous year. The Underlying operating margin was up +210 bps to 5.2%, reflecting the solid recovery in activity. The significant step-up in the Underlying operating margin semester after semester, since the low in Second half Fiscal 2020 of -1.5%, reflects the improvement in activity levels, very tight cost control, numerous contract renegotiations in the On-site activities, more active portfolio management, and the contribution from the GET efficiency program. The GET efficiency program was aimed at protecting the gross profit margin as government aid receded and structurally reducing SG&A for the long-term by simplifying the structures in the Group, to free up capacity to invest in growth and to enhance margins. The program has now been closed.   GET PROGRAM   FISCAL 2020 FISCAL 2021 FISCAL 2022.....»»

Category: earningsSource: benzingaApr 1st, 2022

Federal prison working conditions are getting worse despite Biden’s promise to improve conditions, staffers say

More federal prison workers are experiencing burnout from mandatory overtime and staffing shortages as the pandemic continues. Prison workers across the country are quitting amid the pandemic.AP Photo/LM Otero Insider spoke to 10 current and former prison workers about their eroding working conditions. Working overtime and staffing shortages at prisons are some reasons why workers have quit. The agency said they have improved conditions within federal prisons despite these concerns. President Joe Biden pledged to overhaul the criminal justice system and improve conditions within federal prisons. But more than a year since he took office, some federal prison workers tell Insider their working conditions at federal prison facilities have worsened as the COVID-19 pandemic persists.Staffing shortages, mandatory overtime, and the practice of "augmentation," where non-custodial employees — counselors, doctors, nurses — must substitute as correctional officers despite receiving little or no training, are just some of the issues plaguing dozens of federal prisons across the country.The conditions are causing many prison workers to feel burnt out and driving some to quit the agency."The staffing issues, the stress issue … as months go along, it just gets worse and worse and worse," said Joe Gulley, the president of the local union chapter representing federal employees at United States Penitentiary Leavenworth in Kansas.Josh Lepird, who works for the Federal Bureau of Prisons in Oklahoma, told Insider that there have been "several individuals who quit the Bureau here locally due to this increased stress level and mandated overtime." "Poor staffing is one more worry we do not need when dealing with COVID-19 protocols and the increased stress of the inmate population, who have more restrictions due to the pandemic," Lepird said.Federal prison workers protesting in front of USP Leavenworth prison.John Pheral.There are 122 federal prison facilities located across the country. The Federal Bureau of Prisons, which is one of the Justice Department's largest agencies, currently oversees 154,194 incarcerated individuals and has 36,348 employees as of March 18, according to its website.But prison staffing has been declining.About 6,200 Federal Bureau of Prisons employees left the agency from March 2020 to February 12, 2022, according to the Federal Bureau of Prisons. That translates to 8.7 employees departing every day during that time period.Hiring doesn't appear to have kept pace. The agency previously told Insider it has hired 1,967 employees from March 2021 to July 17, 2021 to address the staffing shortage. The agency repeatedly declined to provide Insider with more information on how many people they hired from July 17, 2021 to March 2022.For years, the Federal Bureau of Prisons has struggled to hire enough employees for its facilities. Because of the staffing shortages, prison workers had to work overtime and participate in the augmentation practice. But when the pandemic hit in March 2020, fears of contracting COVID-19 and the lack of social distancing within these facilities, only  intensified these issues, federal prison workers say. The Federal Bureau of Prisons issued an employee survey last year that found that since the pandemic began, the "majority of respondents reported feeling increased stress or anxiety at work and being asked to perform tasks outside their normal duties."Nearly one in three respondents who answered that they were stressed from the job reported that they have considered leaving the Bureau of Prisons, according to the survey.Prison workers at USP Leavenworth say the number of COVID-19 cases have gone down.Camila DeChalusIn August, Insider reported that prison workers at a Leavenworth prison facility felt like upper management were not adequately taking necessary steps to mitigate the spread of COVID-19. At the time, the federal prison said that only 10 staffers had contracted COVID-19 and recovered. But Gulley said the number of prison workers who contracted the virus was closer to 200. Four current employees at a Leavenworth prison facility recently told Insider that the number of COVID-19 cases have significantly gone down. But the issues of prison workers working more hours and participating in augmentation has driven many to quit."It's definitely been more than I've ever seen in my career," Gulley said, referring to the number of employees that have quit in the last four months than he has since he began working at the Leavenworth prison in 2001.Several prison workers across the country told Insider if the leadership at the agency continues to ignore these problems and not hire more employees then it will lead to more people quitting."I fear that if it doesn't change we are going to see multiple staff either exit or something tragic actually happens. Because you can only work a person so long," said John Butkovich, a correctional officer at a federal prison in Florence, Colorado.The agency needs to act more swiftly to address these concerns because staffing shortages at federal prisons can significantly harm incarcerated individuals residing there, Liz Komar, sentencing overhaul counsel at The Sentencing Project, an advocacy group that works to reduce the use of incarceration, told Insider."People are confined to their cells for longer, staff have reported locking people in their cells for entire weekends and then medical care gets dramatically worse," Komar said.Komar said that this can worsen the medical attention and care that incarcerated individuals receive.The Federal Bureau of Prisons has previously stated that it has taken several steps to mitigate the spread of COVID-19 in federal prison facilities. The agency is "working closely with the Centers for Disease Control and Prevention (CDC) on creating and updating guidance for mitigating the impact of COVID-19 in correctional institutions," Benjamin O'Cone, an agency spokesperson, told Insider."While a prison setting is unique when addressing a pandemic, the care and treatment of an identified positive COVID-19 case is not. The Bureau of Prisons follows CDC guidance, the same as community doctors and hospitals, with regard to quarantine and medical isolation procedures, along with providing appropriate treatment," O'Cone said.O'Cone did not specifically address the staffing shortages or the reasons why individuals are quitting.Earlier this year, Michael Carvajal, who headed the Federal Bureau of Prisons, resigned from his post after facing intense scrutiny for how the agency handled COVID-19 in the federal prison facilities. Attorney General Merrick Garland has not yet appointed someone to replace him.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderMar 18th, 2022

Buchanan: How Solid Are US War Guarantees?

Buchanan: How Solid Are US War Guarantees? Authored by Pat Buchanan, When several NATO nations revealed that they had dozens of Russian-made MiG-29s, the idea arose to fly them to Ukraine and turn them over to Ukrainian pilots familiar with the MiGs. America would provide F-16s to replace the MiGs. Poland had an even better idea. Warsaw would fly its 27 MiG fighter jets to the U.S. Ramstein Air Force Base in Germany. The planes would be turned over to the Americans there, repainted and flown to Ukraine. How to get the MiGs to Ukraine’s pilots would be left to the Americans. Now, as Russian President Vladimir Putin has said that a NATO “no-fly zone” over Ukraine would be an act of war, and NATO intervention could escalate to nuclear war, Warsaw’s proposal raised instant American alarms. The Poles seemed, in the old cliche, to be putting the monkey on our back, having the Americans take the primary risk of defying a specific warning of Putin. Pentagon spokesman John Kirby splashed cold water all over the Poles’ idea: “The prospect of fighter jets ‘at the disposal of the Government of the United States of America’ departing from a U.S./NATO base in Germany to fly into airspace that is contested with Russia over Ukraine raises serious concerns for the entire NATO alliance.” According to The Washington Post, CIA Director William Burns was at the same time warning the House intelligence committee that Putin’s nuclear saber-rattling is of concern, because of Moscow’s military doctrine of “escalate to de-escalate” during a regional conflict. Russia, said Burns, will use tactical nuclear strikes “in extremis” if its forces fail to pacify Ukraine and the U.S. and NATO join the war. Yet, the Poles’ MiG plan, now dead, is revealing for what it says about us. First, while we support Kyiv in its just war, there are limits to that support. We are not going to risk war with Russia for the independence or territorial integrity, or even the continued existence, of Ukraine. Second, as we are unwilling to send MiGs to Ukraine to stop the Russian bombing, lest that involve us in a war with Russia, what is there of sufficient value to us in Eastern Europe that we would actually declare war on Russia, a war that could horribly damage or destroy us both? When the Russians hit a maternity hospital in Mariupol, Ukrainian President Volodymyr Zelensky castigated the U.S. and NATO: “How much longer will the world be an accomplice ignoring terror? Close the sky right now!” “Stop the killings!” Zelensky thundered: “You have power, but you seem to be losing humanity.” Zelensky’s message to the U.S. and NATO, almost daily now, is: “Don’t be cowards. Man up. Do your duty. Close the skies over Ukraine, or send us the planes to do it ourselves.” The U.S.-NATO reply: “We’re with you up to a point. But we are not risking our own security and survival, in what is not our war, for yours.” Putin’s ambition, his goal, his dream, appear transparent — to bring home to the bosom of Mother Russia the diaspora Russians left behind in the lost 14 republics when the USSR splintered and came apart. Those housing significant Russian minorities are Ukraine, Belarus, Kazakhstan and the Baltic republics of Latvia and Estonia. Query: Would we really go to war with Russia if Russia invaded our NATO ally Estonia to bring home Russian peoples left behind at the end of the Cold War? If Russia seeks to create a land corridor through Lithuania and Poland to its separated province of Kaliningrad on the Baltic, would we declare war on a nuclear-armed Russia to prevent it? The Biden administration, with Secretary of State Antony Blinken in the lead, has said again and again these last two weeks that the U.S. will defend “every inch” of NATO territory. Will we? What are we really willing to die for, and what should we be willing to fight for? For that means putting at risk the lives of millions of our people and the ruin of our country. In World War II, we Americans did not go to war with Germany for Great Britain, when it declared war on Hitler’s Germany and then was defeated in France. We went to war with Germany only when Hitler declared war on us, four days after Pearl Harbor in December 1941. America’s media are full of reports of the new “unity” in NATO. But one of the matters about which the Allies seem to be most united is that the Russia-Ukraine war is not ours to fight and we should prevent its spread to any of the 30 NATO nations. On national media, one also hears enthusiasm for bringing Finland and Sweden into NATO. But Finland is the size of Germany and has an 833-mile border with Russia, which would be NATO’s largest. Is it really credible that the U.S. would declare war or go to war with Russia to secure Finland’s border? Tyler Durden Sun, 03/13/2022 - 08:10.....»»

Category: dealsSource: nytMar 13th, 2022

Elizabeth Holmes trial Week 5 recap: A juror leaves over punishment beliefs, and former Safeway CEO Steven Burd describes an unusual deal

Former Safeway CEO Steven Burd testified about the company's contract with Theranos, and a second juror departed in a troubling sign for Holmes. Jane Tyska/Digital First Media/The Mercury News via Getty Images The fraud trial of Theranos founder Elizabeth Holmes has rounded out its fifth week. Former Safeway CEO Steven Burd testified, and another juror left in a troubling sign for Holmes. Here's everything that happened in the trial in its fifth week. Former lab director completes six days on the standThe trial resumed this week with the continued cross-examination of former Theranos lab director Adam Rosendorff. Lance Wade, one of Holmes' defense attorneys, read to the court part of a deposition that Rosendorff had given in a separate case, according to The Wall Street Journal. In it, Rosendorff had said Theranos didn't have more anomalous test results than other places he had worked, including the University of Pittsburgh.Rosendorff responded that the school ran many more tests than Theranos, so Theranos was expected to have had fewer errors.Wade also brought up Rosendorff's current employment at lab services company PerkinElmer, which has also been subject to scrutiny from federal inspectors over its testing abilities, the Journal reports.Rosendorff said under questioning that his lab director license was at risk when the inspectors found problems at PerkinElmer's lab in Valencia earlier this year.Another juror leaves, citing beliefs about punishmentA juror was dismissed on Wednesday after she told the judge her Buddhist religion would affect her ability to ultimately participate in reaching a verdict. Juror No. 4 told Judge Edward Davila that she practices "compassion, for loving and forgiveness," according to ABC News. She said she had become anxious about the possibility of sending Holmes to prison and was "thinking about this every day."After she was dismissed, the alternate chosen to replace her also expressed reservations about being a juror. The alternate told Davila she was worried about her ability to be a juror because English isn't her first language, KTVU reports."It's my first time in this situation and it's her future," the alternate said, according to ABC News. "I don't know if I'm 100% ready to participate in something like this." The alternate also said of Holmes, "She's so young." Regardless, Davila ruled that she was fit to replace the departing juror, who is the second person to leave the jury so far.Former Safeway CEO testifiesOn Wednesday, Steven Burd, who was CEO of Safeway for 20 years before retiring in 2013, took the stand. He testified that upon hearing about Theranos, he thought it was a "fascinating concept" and was "immediately interested in meeting Theranos and particularly the founder.""The cost reductions appealed to me," he said, according to KTVU. "The idea of getting a blood test in 20-30 minutes appealed to me."Burd also sang Holmes' praises on the stand, calling her "charismatic" and "smart.""Not all CEOs are alike," Burd testified, according to The New York Times. "She would rise to the top of the pile in terms of vision, in terms of command of the information, clearly in terms of delivery. She was always decisive."In September 2010, Safeway and Theranos signed a contract with an anticipated $85 million financial commitment, of which $30 million was needed to put labs in Safeway stores. Burd said he thought it unusual that he "never saw an attorney" in the course of the negotiations, which he said Holmes seemed to be doing by herself.Speaking of Theranos' technology, Burd added, "We were consistently told that it essentially replaces a traditional full-blown lab," according to KTVU.You can catch up on Week 1 here, Week 2 here, Week 3 here, and Week 4 here. You can read how Holmes wound up on trial here and see the list of potential witnesses here. Everything else you need to know about the case is here.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 8th, 2021

Trump picks economic aide to replace departing legislative director

President Donald Trump anno.....»»

Category: topSource: marketwatchJul 12th, 2018

Renault board asked to appoint Senard, Bollore: French government

Renault's board will be asked to appoint Jean-Dominique Senard and Thierry Bollore to replace departing Chairman and Chief Executive Carlos Ghosn when it meets later on Thursday, a French government spokesman said......»»

Category: topSource: reutersJan 24th, 2019

Baidu Set to Launch New AI Bot Similar to ChatGPT – Report 

Baidu, often described as the Chinese equivalent of Google, is to launch an artificial intelligence chatbot service similar to ChatGPT in March, according to a report by Reuters.  A source told the… The post Baidu Set to Launch New AI Bot Similar to ChatGPT – Report  appeared first on Red Herring. Baidu, often described as the Chinese equivalent of Google, is to launch an artificial intelligence chatbot service similar to ChatGPT in March, according to a report by Reuters.  A source told the news service that Baidu will offer a standalone application similar to OpenAI’s ChatGPT initially, and will gradually merge it into its search engine. The company’s new bot will be based on its existing Ernie system, a large-scale machine learning model trained over several years, according to the Wall Street Journal.   ChatGPT uses vast amounts of data to give human-like answers to questions posed in natural language. The service quickly went viral after its launch and has been used to write code for programming and even write essays.  This month Microsoft confirmed a $10 billion investment in ChatGPT, and reportedly plans to use the technology to beef up its search engine Bing, which struggles for market share against the dominant market leader Google.  The emergence of AI services like ChatGPT has sparked debate in many industries. Schools have been forced to ban the use of them to write essays, and teachers in several countries have expressed concerns over possible plagiarization through the tools. Others worry they will replace human workers or contribute to the release of biased or inaccurate information.  In China, chatbots are mainly used for social interaction rather than the professional tasks ChatGPT has been used for. According to Reuters, Baidu will add the AI capabilities of a similar service to incorporate chatbot-generated results into search requests, offering fully formed paragraphs of answers rather than a host of links.  Baidu has invested heavily in artificial intelligence in recent years. The Beijing-based company has conducted research in cloud services, autonomous driving and other areas as it looks to diversify its revenue sources. Baidu unveiled three AI-powered services that allow technology to assume the roles of screenwriter, illustrator, editor or animator.  The post Baidu Set to Launch New AI Bot Similar to ChatGPT – Report  appeared first on Red Herring......»»

Category: topSource: redherring38 min. ago

BuzzFeed writers react with a mix of disappointment and excitement at news that AI-generated content is coming to the website

The decision to use tech from ChatGPT maker OpenAI to produce content is part of BuzzFeed's broader cost-cutting strategy in a challenging economy. Some BuzzFeed writers express a mix of disappointment and excitement over the use of AI to generate content.SOPA Images/Getty Images Some BuzzFeed writers told Insider that they are disappointed by the company's move to use AI for content. But one BuzzFeed staffer said that its an exciting development and that it won't replace jobs.  The mixed reactions come amid conversations over whether AI will replace the need for writers. BuzzFeed announced last week that it will be using AI technology made by ChatGPT maker OpenAI to help generate quizzes and new forms of content.The response from writers for the website was mixed.Some told Insider that they are worried about how the AI will impact the quality of Buzzfeed's content. Another source was unfazed by the news, even excited by it.One BuzzFeed writer — a contracted freelancer who requested anonymity in order to speak freely — told Insider that she was "hugely disappointed" to learn that BuzzFeed will be using the chat bot to make content, though she wasn't surprised since BuzzFeed laid off 12% of its workforce last December."It was clear things were only going to go downhill from there," she said.The freelancer said that she doesn't think the AI will squeeze her out of her job. However, she's concerned that readers will stop engaging with BuzzFeed if they realize the articles aren't written by real people and feel the content is worse."My general thought process right now is it's less likely for me to lose the contract because of the AI installation itself and instead a worry that Buzzfeed itself will dissolve after losing all integrity and any remaining trust that existed once the AI articles begin popping up," she said. Another BuzzFeeder who is on-staff told Insider that the adaptation of AI "is obviously a terrible move for all of BuzzFeed Inc's employees.Like the freelancer, the BuzzFeed employee isn't afraid that the move will terminate her job. But she worries that the quality of BuzzFeed content will suffer as a result. "The best thing about BuzzFeed and the part everyone has always gravitated towards is the personality-driven content and the connection it fosters with readers/viewers," the employee said. "If you take that away, I don't see how the quality and performance won't crash and burn."But a second BuzzFeed staffer told Insider that she isn't worried that AI will replace writers at the company. In fact, she said that she is looking forward to the AI integration.During an all-hands meeting Thursday, the second BuzzFeed staffer recalled hearing from CEO Jonah Peretti that AI — as of now — will only be used to generate new forms of quizzes where they will spit out different answers depending on the person. And this is content that only AI can produce, she recalled Peretti saying. "I think the actual applications of how this will apply to new quiz formats is exciting," the second BuzzFeed staffer said.A BuzzFeed spokesperson clarified to Insider that its AI tool will not be fully creating the quizzes. Rather, BuzzFeed staffers will be responsible for writing the quizzes and the AI will only be used to generate an infinite number of responses, they said.It's all part of BuzzFeed's new strategy to "build the premier platform for AI-powered content" with the goal to "maximize the success" of its content creators in an effort to cut costs and stay financially afloat, according to an internal memo from CEO Jonah Peretti sent to BuzzFeed staff that was obtained by Insider.'When you see this work in action, it is pretty amazing'BuzzFeed CEO Jonah Peretti emailed staff about the company's plan to use ChatGPT maker OpenAI's tech in future content.Getty Images/Kimberly White"Our work in AI-powered creativity is also off to a good start, and in 2023, you'll see AI inspired content move from an R&D stage to part of our core business," Peretti wrote in the memo. In addition to generating new quiz formats, BuzzFeed's internal AI tool will also be used for "informing our brainstorming" and "personalizing our content for our audience," the memo said.Amid a challenging economy, the rise of ChatGPT continues to spark debates on whether the impressive AI will replace writers and jobs. An internal AI tool has already been used by tech news site CNET which revealed that it has been using AI to write dozens of articles for months as part of an experiment. However, CNET later announced that it is pausing its usage of AI to produce content after identifying multiple errors, such as incomplete company names and errors in basic math that required corrections.Peretti told CNN that BuzzFeed will use AI responsibly. "There's the CNET path, and then there is the path that BuzzFeed is focused on," Peretti told CNN. "One is about costs and volume of content, and one is about ability."While the move to adapt AI like ChatGPT has irked some writers, investors are loving it. In fact, BuzzFeed's stock jumped to as high as 200% after the news was announced. One concerned BuzzFeed staffer called the stock price jump "darkly hilarious.""It just shows how the free market truly does not care about humans, whether consumers OR laborers, just the perception of growth and innovation," she said. For now, BuzzFeed said that the AI tool will only be used by the quiz team starting in February and expressed excitement over its editorial possibilities."When you see this work in action, it is pretty amazing," Peretti said in the memo. Read the original article on Business Insider.....»»

Category: worldSource: nyt1 hr. 53 min. ago

: How to pay for reparations in California? ‘Swollen’ wealth could replace ‘stolen’ wealth through taxes

California reparations task force hears from tax experts about possible sources of funding for monetary compensation for Black Americans.....»»

Category: topSource: marketwatchJan 29th, 2023

"We Will Root Out The Deep State" - Trump Begins 2024 Campaign In New Hampshire, South Carolina

"We Will Root Out The Deep State" - Trump Begins 2024 Campaign In New Hampshire, South Carolina Authored by Frank Fang via The Epoch Times, Former President Donald Trump visited two early-voting states New Hampshire and South Carolina on Jan. 28, hitting the campaign trail for the first time since announcing his 2024 bid for the White House in November last year. “The 2024 election is our one shot to save our country, and we need a leader who is ready to do that on day one,” Trump said in a speech in Columbia, South Carolina. “We need a fighter who can stand up to the left, who can stand up to the swamp, stand up to the media, stand up to the deep state.” “Am I allowed to say stand up to the RINOs?” Trump continued, referring to an acronym for “Republican in Name Only.” “To stand up to the globalists and China, and stand up for America. And that’s what we do, we stand up for America,” Trump added. “You need a president who can take on the whole system and a president that can win.” Former President Donald Trump, joined by Sen. Lindsay Graham (R-S.C.) (R), and South Carolina Gov. Henry McMaster (L), speaks at a 2024 election campaign event in Columbia, S.C., on Jan. 28, 2023. (Logan Cyrus/AFP via Getty Images) The former president added, “Together we will complete the unfinished business of making America great again.” Trump also unveiled his South Carolina leadership team, which is to be headed by South Carolina Gov. Henry McMaster. Others named to the leadership team include the state’s Lt. Gov. Pamela Evette, Sen. Lindsey Graham (R-S.C.), Rep. Russel Fry (R-S.C.), Rep. William Timmons (R-S.C.), Rep. Joe Wilson (R-S.C.), former U.S. Attorney Peter McCoy, and Trump’s former ambassador to Switzerland Ed McMullen. “This campaign will be about the future. This campaign will be about issues,” Trump added, before criticizing President Joe Biden and his administration’s policies, such as border control, the drug crisis, and the economy. “Joe Biden has put America on the fast track to ruin and destruction, and we will ensure that he does not receive four more years,” Trump added. ‘Marxist Hands Off of Our Children’ One particular issue that Trump said he will address if elected is education. “We’re going to stop the left-wing radical racists and perverts who are trying to indoctrinate our youth. And we’re going to get their Marxist hands off of our children,” Trump said. “We’re going to defeat the cult of gender ideology and reaffirm that God created two genders, called men and women.” “We’re not going to allow men to play in women’s sports,” he added. “We’re going to save the dignity of women and we’re going to save women’s sports itself.” Trump also said he will work to keep South Carolina’s presidential primary as the “first in the South,” which has taken place on Super Tuesday. “It’s a very important state, first in the South,” Trump said. “And there were people wanting to move it. I said, ‘we’re not moving South Carolina.’” Former President Donald Trump speaks at the New Hampshire Republican State Committee’s annual meeting in Salem, N.H., on Jan. 28, 2023. (Scott Eisen/Getty Images) ‘More Committed Now’ Before his speech in Columbia, Trump spoke at the New Hampshire Republican State Committee’s annual meeting in Salem, New Hampshire. He dismissed suggestions that he was off to a slow start in his campaign since announcing his third bid for the presidency. “They said, ‘He’s not doing rallies, he’s not campaigning. Maybe he’s lost that step,’” Trump said in Salem. However, Trump said, “I’m more angry now and I’m more committed now than I ever was.” Trump announced Stephen Stepanek, the outgoing chairman of the New Hampshire Republican Party, would be joining his team as a senior advisor for his campaign in the Granite State. Chris Ager, a Republican National Committee member, has been elected the new chairman to replace Stepanek. Primary Calendar The former President criticized the Democrats’ efforts to change their primary calendar. “From the very beginning, I’ve strongly defended New Hampshire’s first-in-the-nation primary status. I have been your defender,” Trump said. “I refuse to let any Republican, and there are some you know who they are. even think about taking that cherished status away.” Honoring Biden’s wishes, the Democratic National Committee’s (DNC) Rules and Bylaws Committee passed a proposal in December making South Carolina the first vote in the party’s presidential nominating calendar. Under the proposal, South Carolina’s primary would be held on Feb. 3, followed by Nevada and New Hampshire on Feb. 6, Georgia on Feb. 13, and Michigan on Feb. 27. Iowa is historically the first state to have a closed caucus, followed by New Hampshire with the first primary. “We will root out the deep state and stop the weaponization of federal agencies because there’s a weaponization like nobody’s ever seen,” Trump added. “We are going to take back our country, and we’ll take back the White House, and we’re going to straighten out the United States of America.” Tyler Durden Sun, 01/29/2023 - 13:30.....»»

Category: smallbizSource: nytJan 29th, 2023

Russia and Iran plan a gold-backed stablecoin, while Brazil and Argentina seek a shared currency. Here are 5 rising threats to the dollar"s dominance of global trade.

King dollar's dominance of global trade faces new threats in the form of currency projects led by countries from China and Russia to India, Iran and Brazil. The dollar's dominance of global trade and reserves is facing several new threats.Getty Images The dollar's supremacy in global trade faces fresh challenges as several countries float plans to use local currencies in commerce.  Russia and Iran are working to create a gold-backed stablecoin, while China is increasingly using the yuan in its oil trades.  Here are 5 rising challenges to the greenback's dominance of international trade and investment flows. The dollar's dominance of global trade and investment flows is facing a slew of new threats as many countries push plans to boost the use of alternative currencies.Nations from China and Russia to India and Brazil are pushing for settling more trade in non-dollar units – with plans ranging from the use of local currencies to a gold-backed stablecoin and a new BRICS reserve currency.For decades, the greenback has reigned supreme as the world's reserve currency and is widely used in crossborder trade, especially for commodities such as oil. Thanks to its relative price stability, investors see it as a safe-haven asset in times of heightened economic and geopolitical uncertainty.The dollar was further bolstered last year by a surge in US interest rates that made it attractive to foreign investors seeking higher yields. It surged 17% during the first nine months of 2022, but has since lost some of its shine on the prospect that the Federal Reserve may soon end its rate hikes as inflation cools rapidly. Against this backdrop come the latest threats to the greenback's reign — here are five currency projects from across the world that are ultimately aimed at undermining the dollar's supremacy.Brazil and Argentina plan a common currencyArgentina's president Alberto Fernandez (left) and Brazil's new leader Lula.Eraldo Peres/AP PhotoBrazil and Argentina recently announced they are gearing up to launch a joint currency, named the "sur" (south), that could eventually become a euro-like project embraced by all of South America.A common currency could help boost South American trade, the countries' leaders said in a joint statement, because it evades conversion costs and exchange rate uncertainty. That could erode the dollar's dominance in the region, given the greenback accounted for as much as 96% of the trade between North and South Americas from 1999 to 2019, according to the Federal Reserve.  Russia and Iran eye a gold-backed stablecoinRussian President Vladimir Putin.Sputnik/Sergey Bobylev/Pool via REUTERSRussia and Iran are working together on a cryptocurrency backed by gold — a 'stablecoin' that could replace the dollar for payments in international trade.The two countries, both of which have been hit by Western sanctions, want to issue a "token of the Persian region" for use in crossborder transactions, with a plan to launch it in a special economic enclave in Astrakhan in southern Russia, which already handles Iranian shipments.But the project can move forward only once Russia's market for digital assets is fully regulated, according to a Moscow lawmaker.Russia and Iran have stepped up their push to "de-dollarize" in recent months, according to think tank the Jamestown Foundation. They aim to increase their volume of trade to $10 billion per year via moves such as developing an alternative international payments system to SWIFT, which they are banned from.UAE, India look at using rupees in non-oil tradeThe UAE and India signed a free trade agreement last year with a goal of increasing non-oil transactions to $100 billion by 2027.Bloomberg Creative PhotosMeanwhile, the United Arab Emirates and India have floated the idea of conducting non-oil trade in rupees. The move would build on a free trade agreement signed last year, which aims to boost trade excluding oil between the two countries to $100 billion by 2027.China has also pondered on the idea of settling non-oil trade in local currencies that exclude the greenback, according to minister of state for foreign trade of the UAE Thani bin Ahmed Al Zeyoudi. China pushes for the yuan to replace the dollar in oil tradesRussian President Vladimir Putin (L) and Chinese President Xi Jinping pose for a photograph during their meeting in Beijing, on February 4, 2022.Photo by ALEXEI DRUZHININ/Sputnik/AFP via Getty ImagesChina, for another, is looking to weaken the dollar by pushing for the yuan to replace the greenback in oil deals, given its increased trade with Russia after it invaded Ukraine. The move looks to chip away at the petrodollar regime in place since the 1970s, where global oil transactions are largely settled in dollars. Toward the end of last year, Beijing began buying Moscow's crude at steep discounts, completing those purchases in yuan rather than dollars, giving rise to the so-called petroyuan. With a stronger greenback, oil contracts become more expensive because the deals are largely priced in the US currency, and this also explains China's shift away from the dollar.Kpler analyst Viktor Katona said Russia has effectively become "an Asian nation that in my opinion has introduced the yuan into large-scale oil trade."Russia, China propose a new reserve currencyLeaders of BRICS countries — Chinese President Xi Jinping, Russian President Vladimir Putin, Brazilian President Jair Bolsonaro, Indian Prime Minister Narendra Modi, and South African President Cyril Ramaphosa — at the BRICS summit in Osaka, Japan, on June 28, 2019.Sputnik/Alexey Nikolsky/Kremlin via ReutersLast year, Russia and China kickstarted talks to develop a new reserve currency with other BRICS countries in a challenge to the dollar's dominance. The new reserve unit would be based on a basket of currencies from the group's members: Brazil, Russia, India, China, and South Africa.The dollar's reign as the chief reserve tender is already on the wane as central bankers diversify their holdings into currencies like the Chinese yuan, the Swedish krona and the South Korean won, according to the International Monetary Fund.Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 29th, 2023

How Russia is molding the minds of schoolkids to support its brutal invasion of Ukraine

Russia's forced patriotism program, euphemistically named "convserations about important things" is shaping children to support its costly war. A screengrab circulated by Russia's Ministry of Education, showing Ukrainians in the occupied Donetsk region dancing and singing the Russian national anthem and waving the Russian flag.Russian Ministry of Education Russia is running a campaign of propaganda lessons to rally support for its invasion of Ukraine. Insider reviewed troves of lesson materials posted online as part of the nationwide program. The lessons are said to be facing resistance and sabotage from teachers unwilling to teach them. Russia is targeting schoolkids with propaganda meant to underpin its invasion of Ukraine, preparing children as young as 7 to be ready to die for their country.The campaign takes the form of compulsory patriotic lessons, rolled out by the Kremlin in late 2022.Officials uploaded a slew of approved lesson plans and talking points to a government website, which Insider reviewed and translated.Although clearly a response to the invasion of Ukraine, the materials avoid naming the conflict and instead take a more subtle route.The series is euphemistically called "Conversations about important things", with the stated aim of "strengthening traditional Russian spiritual and moral values."Russian President Vladimir Putin at a rally in Moscow held in March 2022, a few weeks after Russia invaded Ukraine.RIA Novosti Host Photo Agency/Ramil Sitdikov via ReutersThe first lessons were taught in September 2022, just as Russia was drafting 300,000 military reservists to fight in Ukraine.Many of them would have been waved off by their school-age children, and some are undoubtedly now among Russia's vast number of war dead.An image from the lesson materials showing Russian armored personnel carriers marked with the Z symbol from the invasion of Ukraine.Russian Ministry of EducationAccording to the Teachers' Alliance independent trade union, the program was originally explicit in its mission to sell kids on the war in Ukraine.But, the union said, "huge internal resistance" from Russia's teachers forced officials to edit out most references to the "special military operation" and achieve its aims less directly.Lessons are given themes like "Day of Knowledge" and "Day of National Unity," with teachers provided with Kremlin-approved presentations, videos and full lesson scripts.A scripted introductory speech for one lesson was a eulogy to Russia's claimed annexation of Ukrainian territory just days before at the end of September.A cartoon character from a video lesson aimed at children in the first and second grade.Russian Ministry of Education(In reality, the votes were widely dismissed as a sham, and much of its ostensibly annexed territory is controlled by Ukraine.)But children as young as 11 were told the annexation was justice overdue. "For eight years, the population of these regions was subjected to constant shelling and ill-treatment by the Kyiv regime," the script reads, leaning into the debunked Russian refrain that Ukraine is a Nazi regime oppressing its own people.Russia, the script continues, provided a refuge: "The inhabitants of these regions turned to us," it said, and "almost unanimously voted for joining the Russian Federation," it said, citing the heavily disputed voting totals.A map from one of the lessons, depicting the Ukrainian regions of Luhansk and Donetsk as parts of Russia.Russian Ministry of EducationThe script also repeated the claim, advanced elsewhere by Russia's President Vladimir Putin, that it also righted a centuries-old wrong and "restored historical justice, returning the original Russian lands" to rule from Moscow. Elsewhere, a lesson ostensibly celebrating Russia's World War II veterans glides into praising "our fathers, brothers [...] defending the freedom of their compatriots, their fellow citizens" in Ukraine's occupied east.At times the lessons prompt the children to imagine themselves fighting in a war for Russia — something which for the older children could become a reality within years.The penultimate class of 2022, marking Heroes of the Fatherland Day, includes an address by Dmitry Perminov, a Russian politician and former army officer celebrated for his role in the Dagestan War in the '90s.Amid tales of heroic deeds, including honouring doctors who saved the life of a young Russian soldier fighting in Ukraine, Perminov has a simple message for children: this could be you.Unlike in the West, he says, where their heroes are "fictional characters", in Russia their heroes are "simple people" fighting on the battlefield, and even "schoolkids".Another lesson script has an even clearer message: "You can't become a patriot if you only declare slogans," it said. "Truly patriotic people are ready to defend their Motherland with weapons in hand."As well as reaching young Russian minds, the program is also being delivered to children in occupied Ukraine, part of Moscow's push to replace the language and culture there with its own.Proof of this is contained in the Kremlin's supplementary lesson materials, including competition entries where schools seek to outdo each other in dedication to Russia.Among these is a striking piece of pageantry from Donetsk, which shows a group of teenagers stiffly singing the Russian national anthem before the camera turns to the front of the classroom: nine girls in silky dresses matching the white, blue, and red of the Russian flag.Children in Donetsk singing the Russian national anthem.Russian Ministry of Education"The people of the Donbas are proud of their national symbols and love their motherland, Russia," the teacher says, using the joint name for the Luhansk and Donetsk regions of Ukraine that have seen the worst fighting.The children then dance for the camera.Despite the risks, anti-war activists have called for a mass boycott of the program.With the rollout of the curriculum, the Teachers' Alliance published template statements of resistance for teachers and parents to send to schools, calling on local leaders to "free children from propaganda lessons."A teacher in occupied Donetsk, leading her class in singing the the Russian national anthem.Russian Ministry of EducationSpeaking to the independent Russian news outlet Meduza, which now reports in exile from Latvia, union spokesperson Daniil Kent said there was "massive sabotage" of the lessons.Swathes of teachers, he said, had decided "to ignore these manuals and conduct the lesson in their own way".Despite such movements, one elementary-school teacher told Insider she was still worried about the lessons. The teacher spoke to Insider on condition of anonymity for fear of reprisals."For the teenagers, these classes will not be enough to brainwash them," she said."They have access to the world via the internet. It's the effect on young children, whose whole world is their school and family, that scares me."Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 29th, 2023

I compared the best business-class trains I"ve ever taken in Canada and Italy, and my favorite cost half the price

Insider's reporter took business-class trains in Canada and Italy. One included meals and lounge access, the other had a better seat and cost less. Insider's reporter upgraded to business class on train rides in Canada (L) and Italy (R) to see which she liked better.Joey Hadden/Insider In 2022, I took business-class trains on Via Rail in Canada and Trenitalia in Italy. My $216 Via Rail ticket included meals and station lounge access. The $100 Trenitalia fare didn't. After comparing both trains, I thought my business-class ride in Italy was more comfortable overall. I recently traveled by train in business class in two countries to see how they compared: a Via Rail train in Canada and a Trenitalia train in Italy.The author rides in business class on trains in Canada (L) and Italy (R).Joey Hadden/InsiderI've spent more than 150 hours on train rides over the last year and a half, ranging from 3 to 30 hours long while exploring the US, Canada, and Europe by rail. And I've found that the more time I spend on trains, the more I value being comfortable. Having enough space, a cushy seat, and a clean bathroom are are now necessities, and that's why I started upgrading to business class on my most recent trips.In August 2022, I took a business-class Amtrak train to Niagara Falls, New York, where I crossed the border into the Canadian province of Ontario. Later that week, I took a 6-hour Via Rail business-class ride in Canada from Toronto to Montréal.Two months later, I took a 4-hour Trenitalia business-class ride in Italy from Venice to Rome during a two-week train trip through Europe.Overall, I decided that my rides in Canada and Italy were far better business-class experiences than in the US, where the price did not feel worth it for the journey I had.So, I decided to compare my train trips in Canada and Italy to figure out which country offered the best business-class experience.Via Rail and Trenitalia are both popular train lines in Canada and Italy.Business-class train cars in Canada (L) and Italy (R).Joey Hadden/InsiderCanada's main railroad system, Via Rail, is one of the most accessible and popular ways to travel by train in Canada, serving more than 400 stations in eight provinces across Canada with economy seating, business class, and sleeper accommodation, according to its website.Via Rail runs 10 fleets of passenger trains that go up to 100 miles per hour, according to the Via Rail corporate website. Business-class Via Rail cars are typically marked by a blue and yellow stripe at the top, according to the same source.Trenitalia is the main train operator in Italy that is owned by the Italian government, and serves more than half a billion travelers each year, according to its website. The trains stop at 64 stations in Italy, according to Moovit, which finds routes and transportation options around the world. Trenitalia runs several series of trains, from high-speed rides to inner city connections, according to the train ticketing site, Italia Rail. I rode a train from the Frecciarossa series, which is the second-fastest series after Alta Velocità that reaches 250 miles per hour, according to Italia Rail. This was my first time on both Via Rail and Trenitalia, so I was excited to see how the train rides compared, especially in a premium setting such as business class.The Via Rail Ticket was more than double the price of the Trenitalia ticket.A screen at the author's boarding platform in Toronto (L). The author's ticket on the train in Italy (R).Joey Hadden/InsiderIn Canada, my Via Rail ride cost $216. Based on my research, standard coach tickets start at around $100.To travel by train in Europe, I bought a Eurail pass for $477, which gives access to most European trains for a set number of days. Some trains and classes only require a Eurail pass to ride, while others incur an additional discounted price.For my business-class Trenitalia trip, I paid an additional $10 to upgrade my ticket to business class on top of the Eurail pass fee. But without the Eurail pass, business-class tickets on this route typically cost around $100, according to a search on Trainline I made looking at dates that are three months ahead.My Via Rail ticket included access to an exclusive lounge, but my Trenitalia ticket did not.The author waits for trains in Canada (L) and Italy (R).Joey Hadden/InsiderI arrived at Toronto's Union Station at 7:30 a.m. for my 8:30 a.m. train to Montréal because I knew my business-class ticket came with access to an exclusive lounge at the station with plenty of seating and free refreshments.The lounge was mostly empty on a Friday morning. I thought it was a quiet and peaceful place to enjoy a coffee and get some work done. According to their website, Via Rail's lounges are available to passengers traveling in business class, sleeper plus, prestige, and VIA Rail Premier members traveling in economy inside major train stations in Canada.For my 1:38 p.m. Trenitalia ride to Rome, I arrived at Venice's Mestre Station just after 1 p.m. because I knew my ticket didn't include access to a lounge.When I arrived, I went straight to my designated platform upon arrival and waited for my train on a bench. It was a sunny day in Venice, and the outdoor platform wasn't crowded, so I didn't mind waiting outside.Although I didn't visit a lounge as part of this ride, Frecciarossa has these exclusive areas at select stations, too, called FRECCIALounges. They're only free to access for passengers traveling in executive class, Gold or Platinum FRECCIA credit card holders, and groups of 10 with business-class tickets, according to Trenitalia. These lounges are also only available in five stations in Italy: Roma Termini, Milano Central, Bologna Central, Firenze Santa Maria Novella, and Napoli Centrale, according to the same source. When boarding each business-class train, I thought that Italy's business-class car had more space to store luggage than in Canada.Storage spaces in business-class train cars in Canada (L) and Italy (R).Joey Hadden/InsiderWhen I entered each business-class train, one of the first things I noticed was the space provided to store luggage.On both trains, I was able to store luggage under the seats in front of me and in overhead bins. I tend to travel with just a backpack, so there was enough room for it on both trains above my seat.In Canada, my backpack didn't fit underneath the seat in front of me, so I slid it into an overhead bin, which was challenging for me to reach since I'm 5-foot-3.But in Italy, I felt like I had enough space underneath the seat in front of me for more than just my backpack. I thought that I would have been able to fit a whole duffel bag or carry-on suitcase beneath the Trenitalia seats if I needed, in addition to the area provided above.In both Via Rail and Trenitalia's business-class cars, the configuration was two seats on one side of the aisle and one seat on the other.Business-class train cars in Canada (L) and Italy (R).Joey Hadden/InsiderThe seating configuration onboard business class trains in Canada and Italy was very similar.In Canada, I was traveling by myself, so I booked a seat in a single row, and was happy to have my own space.In Italy, I traveled with my partner. Most of the single-row seats faced each other with a shared table in between, which is what we booked. The double-row seats faced another row of two seats, which I thought made it ideal for groups of four.I thought the Via Rail seat was comfortable throughout the 6-hour journey, but the Trenitalia seat was even cozier.Business-class seats on trains in Canada (L) and Italy (R).Joey Hadden/InsiderWhen I have to sit on a train for hours, I want to feel like I'm relaxing. So a cushy, spacious seat is what I look forward to most in premium cabins like business class.In Canada, right away, I thought that my Via Rail seat was one of the most comfortable I'd ever experienced on a train. I attributed this to the fact that the top of my seat was curved, and I was able to rest my head in a comfortable position for lounging.The Toronto Star reported that Via Rail business-class seats are 18.5 inches wide, which felt large enough for me. It also reclined, giving me a chance to relax more during the long journey. Two months later in Italy, I was surprised to find that the Trenitalia seats were even more comfortable than the Via Rail seats. Trenitalia's seats are about 25 inches wide, according to the train booking site ACP Rail International. It also had a curved headrest and reclined.While both seats reclined and had curved headrests and outlets to charge my devices, I thought the Trenitalia seats looked noticeably wider and thicker than on Via Rail. When I sat down, I found that they felt even cushier, like a small couch or loveseat, which gave it the edge for me over Via Rail.In both business-class seats, I was impressed by the amount of legroom I had. But I think I had a few more inches in Canada.The seat pitch on business-class trains in Canada (L) and Italy (R).Joey Hadden/InsiderSince I'm only 5-foot-3, having a lot of legroom isn't totally necessary for my comfort on long trips, but I do prefer to have enough space to stretch a little.The Toronto Star reported that Via Rail business-class seats have a 39-inch seat pitch. I also noticed that the seat had a foot rest, which I used to extend my legs when they started to feel stiff. Trenitalia's seats are about 63 inches apart, according to the train booking site ACP Rail International. So my partner and I each had 31.5 inches of legroom. I thought it was enough room for people traveling together who don't mind sharing the space, but if I didn't know the person sitting in front of me, I would have felt cramped. Both seats came with tray tables, but the table onboard Trenitalia was larger.Tables at business-class seats in Canada (L) and Italy (R).Joey Hadden/InsiderI think having a table on a train ride makes it easier to eat, work, read, and play games. I had one on each ride, though they differed slightly.In Canada, I had a seatback tray table, which is typical of most train rides I've taken. There was a cup holder in the top right corner to keep my drinks from spilling while the train was moving. In Italy, our seats came with a table in the middle that folded out on both sides for additional space. It was large enough for us to play cards, which excited me. I've always loved card games. When I took trains as a kid, I played with my brother while sitting on the floor using our seats as a table. So, dealing out a hand comfortably on a train without making a mess was not only comfortable, but a memorable experience. In Canada, my seat also came with a side table next to the window. My seat in Italy did not.Tables in business-class train cars in Canada (L) and Italy (R).Joey Hadden/InsiderIn Canada, I was surprised to find that I had a side table in addition to a tray table that pulled out in front of me, since no other train I've ever been on offered two tables per passenger.Throughout the trip, I used the side table to hold my coffee while working and to store my laptop while taking breaks. I thought the side table gave me the advantage of putting my tray table up so I could have more space in front of me.In Italy, there was no additional side table at my seat, but since the table provided was larger, I thought it served the same function. When I wasn't using the table, I folded it back up to give myself more space, just like the tray table in Canada.  Ultimately, I found that with both Canada's two small tables and Italy's larger shared table, I had adequate room for eating, drinking, and working on my laptop on both rides.My Via Rail business-class ticket included complimentary breakfast, lunch, snacks, and drinks, while my Trenitalia ticked only included complimentary snacks and drinks.Complimentary food served on Canadian (L) and Italian (R) trains.Joey Hadden/InsiderFor train rides that are more than five hours long, I always make a plan for eating, whether its bringing my own food, confirming the train has a cafe car, or booking a ticket that includes a meal.Some train lines serve complimentary meals to business and first-class guests.In my case, my 6-hour Via Rail ride in Canada included complimentary meals, which were brought to my seat by a train attendant. For breakfast, I was served a warm bagel with cream cheese. It was no New York bagel, I thought, but it was decent and filled me up.The lunch menu on the same ride was announced over the loudspeaker. I chose a rigatoni dish with sides of corn salad, bread, and carrot bread for dessert. The meal was better than I expected with an al dente cook on the pasta. I also thought it was much better than pasta I've tried on Amtrak trains in the US in the past.Trenitalia's ticket didn't come with a meal, but the attendants came by with complimentary trail mix and drinks. They served me coffee and tangerine juice with my snack. Since it was a shorter ride, I was fine without the meal. But if had gotten hungry, I would have gone to the cafe car to purchase more refreshments.Trenitalia didn't immediately respond to Insider's request for comment about if any business-class tickets include meals. I thought the business-class perks were better on the Via Rail route than on the Trenitalia ride.A hand wipe served to the author on the Via Rail train (L), and service attendants on the Trenitalia train (R).Joey Hadden/InsiderOn Via Rail in Canada, I quickly learned that business-class trains here came with a lot of luxury perks like the attendant service that I found to be exceptional.Shortly after departing, a train attendant came around with complimentary drink service, and then again for refills about an hour later. Between meals, the same attendants came around with snacks and warm hand wipes, as well. Via Rail didn't immediately respond to Insider's request for comment on whether or not these services are offered on all business-class trains.  On the Trenitalia train, I found luxury perks, too, like complimentary snack and beverage services. However, in my experience, the train attendants on the Trenitalia came by with snacks and drinks less frequently than on the Via Rail train. Trenitalia didn't immediately respond to Insider's request for comment about business-class perks.In Canada, stops were announced over a loudspeaker. Trenitalia's train had several screens inside the business-class car showing the route and upcoming stops.An informative screen on the Trenitalia train.Joey Hadden/InsiderKnowing where I am is on my journey when I'm taking trains is really important to me. Even if I know I have hours before my stop, I feel more comfortable and confident as a traveler when I know the train's route.Usually, I just use my phone to look up my train's route and then double-check on Google Maps that I'm headed in the right direction. I did this in Canada, where stops were announced over a loudspeaker, which is typical of most trains I've been on.But in Italy, I didn't have to use my phone because the Trenitalia train had informative screens around the car. I was able to look in nearly every direction at any time to see when my stop was coming up. I had never seen this inside a train car prior to my trip to Europe, and I thought it was a nice touch that relieved me from having to constantly check my phone. In Canada, the train bathroom didn't seem upgraded for business class. But in Italy, the business-class bathroom felt elevated to me.Business-class train bathrooms in Canada (L) and Italy (R).Joey Hadden/InsiderI've come to not expect much from train bathrooms. In many of my experiences, they've felt cramped, even in first and business classes. I didn't notice anything special about Via Rail's business-class bathroom compared to other train classes or rides I've experienced, but I was impressed by how clean the bathroom appeared to be compared to most train bathrooms I've used.But on the Trenitalia train, I walked into what I thought was the nicest train bathroom I'd ever used. The business-class bathroom felt spacious and clean with blue lighting and a large mirror above the sink.Usually, I'm rushing to get out of a train bathroom as quickly as I can because it feels cramped, dirty, or both. But on the Trenitalia train, I felt comfortable taking a little bit extra time to look in the mirror.After experiencing business-class trains in Canada and Italy, I concluded that both offered memorable rides, but I had a better overall time on Trenitalia's business-class train.The trains arrive in Québec City, Canada (L), and Rome, Italy (R).Joey Hadden/InsiderDeciding which business-class ride was better was a challenge for me. I thought both trains were far more comfortable and luxurious than any rides I've booked in the past. While the Via Rail train in Canada came with additional luxury perks like complimentary meals and lounge access, I ultimately decided that I had a better time on Trenitalia thanks to its ultra-comfy, spacious seats, as well as features that the Via Rail car didn't offer, like informative screens and an elevated bathroom. I also appreciated that it was priced affordably.In a statement to Insider, Via Rail said a new fleet of trains on the same route I traveled will soon feature several changes. The new trains will have "wider aisles, automatic touchless interior doors, extendable tray tables, and ergonomic seats," the statement said. The statement noted more updates like the addition of business-class pods, high-speed data connection, and redesigned bathrooms. "We will offer garbage collection onboard the train and recycling bins," the statement also said.But whether you're traveling four hours or six, I recommend traveling in business class on both Canada's and Italy's trains for a luxury experience where you really can't go wrong in either location. Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 29th, 2023

Thai Rice Prices Jump As Global Food Crisis Reignites

Thai Rice Prices Jump As Global Food Crisis Reignites Soaring rice prices is the latest example of persistent food inflation. The grain is responsible for feeding billions of people, and prices were relatively stable last year while wheat soared until now. Since November, Thailand's white rice prices jumped to two-year highs, up 23% to $523 per ton.  "Strong demand lies at the heart of the rally, with some importers buying more of the grain to replace wheat after the war in Ukraine disrupted supplies. Some consumers have also been stocking up ahead of festivals, while a strengthening Thai currency has helped push up dollar-denominated prices," Bloomberg explained.  Thailand, the world's second-largest rice exporter, has seen increasing demand from Indonesia and Iraq, said Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association.  "Iraq has been diligently buying our rice every month," said Ophaswongse, adding the Middle Eastern country was the largest buyer last year.  However, as Thai rice gets more expensive, buyers in China and Malaysia are swapping for inexpensive alternatives.  Expensive rice will pressure many of the world's households that rely on the grain. The problem with rice is that it's a staple, and rising prices could fuel discontent or, worse, food riots.  What's more alarming is that the Food and Agriculture Organization's food price index, which tracks international prices of the top traded food commodities worldwide, remains at levels associated with triggering the Arab Spring, a series of anti-government protests across the Middle East in the early 2010s.  The good news is that upside momentum in food commodity prices has dramatically slowed, if not reversed, in some cases, though the rise in rice prices is a concern because billions of people rely on the grain for survival. ... and China is shifting into a net food importer that might put upward pressure on food prices this year.  Tyler Durden Fri, 01/27/2023 - 22:45.....»»

Category: personnelSource: nytJan 28th, 2023

ChatGPT creator OpenAI might be training its AI technology to replace some software engineers, report says

OpenAI has reportedly quietly hired hundreds of international contractors in the last 6 months to train its AI in software engineering. OpenAI might be training its AI to replace some software engineers.Maskot/Getty OpenAI has quietly hired hundreds of international contractors to help train its AI tech, according to Semafor. Some are teaching software engineering to AI, potentially paving the way to replace some human coders.  OpenAI's chatbot, ChatGPT, already threatens to disrupt many industries just a few months after its launch. OpenAI has quietly hired hundreds of international contractors to train its artificial intelligence in software engineering, according to a report from Semafor. Some contractors, hired in the last 6 months from places like Latin America and Eastern Europe, have reportedly been tasked with creating data to coach AI to learn simple software engineering tasks.While OpenAI already has a product called Codex, which can convert natural language into working code, the company's hiring spree indicates that it's looking to advance that technology, potentially creating a working replacement for some human coders. Semafor spoke to one engineer in South America who interviewed for one of OpenAI's contractor roles. As part of the process, he was tasked with finding bugs in AI code and providing explanations for how to fix its mistakes. The engineer told Semafor he thinks the company wants to feed the training data into its AI technology. OpenAI did not immediately respond to Insider's request for comment. OpenAI is also the owner of the buzzy AI chatbot, ChatGPT. Since the bot's launch late last year, it has already threatened to disrupt education, journalism, and law. Software engineering might be added to the list next. In fact, Insider recently reported that some Amazon employees have already started using ChatGPT to help with coding, though the company warned its employees not to share confidential corporate information with the bot.  Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 27th, 2023

Controversial noncompetes now face a possible ban. But one group never had to worry about them: attorneys

Noncompete agreements bind an estimated 30 million US workers, but lawyers have long been protected from signing the agreements. Hundreds of thousands of workers could soon switch jobs if the FTC's proposed noncompete ban gets enacted, recruiters told Insider.zhuweiyi49/Getty Images The FTC estimates that about 30 million workers are bound by noncompete agreements across the US. Experts say banning the agreements could motivate workers to leave for higher paying jobs, or start their own businesses. However, an American Bar Association rule has long protected lawyers from being forced to sign the agreements. The FTC proposed a ban on noncompete agreements, but one group of workers has long been protected from them: lawyers.The Federal Trade Commission estimates that about 30 million workers, nearly 20% of the workforce, across the US are currently bound by noncompetes.FTC Chair Lina M. Khan announced the proposed ban in a Jan. 5 statement. "Noncompetes block workers from freely switching jobs, depriving them of higher wages and better working conditions, and depriving businesses of a talent pool that they need to build and expand."The contracts frequently prevent departing employees from taking jobs with competing companies or jobs with close proximity to the original employer. They also can mandate a certain amount of time before starting a new job. Companies argue that noncompetes protect their intellectual property. The American Bar Association's Model Rules of Professional Conduct protects lawyers from being forced to sign noncompetes. This is largely because of attorney-client privilege, as the rule states that the agreement "not only limits their professional autonomy but also limits the freedom of clients to choose a lawyer."The ABA's rule contrasts with a similar rule from the American Medical Association that discourages medical professionals from signing noncompetes, but does not ban them.Erik Weibust, a lawyer who works on cases involving noncompetes, told Bloomberg that the ABA's rule is likely stronger because "lawyers make the rules."Earlier this month, recruiters told Insider that doing away with noncompete agreements could lead to another wave of employees leaving for better opportunities, or to start their own businesses.The FTC estimated that banning the agreements could help increase earnings for millions by up to $300 billion, and help close gender and race wage gaps by between 3-9%.Because many people of color begin working from a lower economic position, it is harder for them to overcome financial hurdles like noncompetes to maximize earning potential, according to the National Employment Law Project.Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 27th, 2023

How Will Maersk-MSC Split Redraw Container Shipping Landscape

How Will Maersk-MSC Split Redraw Container Shipping Landscape By Greg Miller of FreightWaves The decision by MSC and Maersk — the world’s two largest container lines — to terminate the 2M vessel-sharing alliance was predictable. The bigger surprise will be what happens next. Will both MSC and Maersk go it alone after 2M ends in January 2025? Will Maersk join another alliance or create a new one? How will this affect the remaining two global alliances: Ocean Alliance and THE Alliance? And how will it affect cargo shipper pricing? According to Alphaliner, MSC has acquired 271 secondhand ships since August 2020, with capacity of just over 1 million twenty-foot equivalent units. MSC’s recent secondhand acquisitions exceed the entire capacity of HMM, the world’s eighth-largest carrier. MSC has over 1.8 million TEUs of newbuild capacity on order, more than double the orderbook of any other carrier. Its orderbook capacity is higher than the existing tonnage of Hapag-Lloyd, the world’s fourth-largest shipping line. “To me, it is obvious that MSC will go on its own,” Alphaliner shipping analyst and Europe editor Stefan Verberckmoes told American Shipper. “It will have enough resources to offer a worldwide network without any partners, which is what it was used to doing before it joined 2M in 2015. “It is indeed no surprise [that 2M will end],” said Verberckmoes. “That was really a forced marriage, because at that time, economies of scale were very important, everybody wanted to have large vessels, and the only way to fill them was to cooperate. Now times are completely different. MSC is now able to fly on its own wings.” Sea-Intelligence CEO Alan Murphy said in an interview with American Shipper: “If MSC was going to invest itself out of the alliance, it has done all the right things, through its secondhand purchases and newbuilding expansion.” Questions on Maersk In sharp contrast to MSC, Maersk has kept its fleet capacity flat over the past three years. It focused instead on being an end-to-end logistics integrator, seeking to earn more from long-term customers’ logistics spend. “For Maersk, the question is completely different,” said Verberckmoes. “They have chosen another strategy and not focused on fleet expansion, so if they want to keep the same network they have now, they need to find a replacement. They will have to review their options.” American Shipper asked Maersk whether it could provide the same level of service coverage and quality to its customers post-2M without a new alliance partner, and whether it was committed to finding an alliance replacement. The company responded: “Maersk will continue to be active in vessel sharing agreements [VSAs]. We are already active in over 40 VSAs in other geographies and we remain open to more targeted VSAs than the broad scope of 2M after the agreement ends in 2025.” For several reasons, Murphy believes it is unlikely that Maersk will replace MSC with a major carrier in a new alliance, or join an existing alliance.  “What I think is more likely is that Maersk will do VSAs. You see how they’ve managed to integrate with Zim [NYSE: ZIM], which is not a 2M member, on the Asia-East Coast trade. They can also do slot charters with THE Alliance on some trades and slot charters with Ocean Alliance on others. “Rather than formally being in an alliance, I think it’s more likely they will focus on the key markets where they can provide end-to-end services and then find [VSA and slot-charter] partners in the other markets.” Strategies ‘completely at odds’ One difficulty Maersk faces in replacing MSC relates to a core problem with 2M itself. “The strategic focuses of the two shipping lines have been completely at odds with each other,” explained Murphy. “Maersk has staked everything on being an end-to-end logistics integrator. If you’re focused on the customer experience and end-to-end logistics, ocean transport becomes just a cog in a big machine. That cog just needs to work. You don’t need to necessarily make money on it because you’re making money on end-to-end logistics. “But MSC’s focus has seemingly been: We need to make money as a vessel operator. That might very well mean blanking [canceling] sailings at a much higher rate and not wasting money on schedule recovery. In some trades where MSC operates independently, it looks more like tramp [unscheduled] than liner service. “These two strategies have led to friction within the alliance. I wouldn’t say anybody is wrong here. It’s just that they don’t seem to be a good match.” Maersk is much more focused on the end-to-end integrator model than any other carrier. So, replacing MSC would present Maersk with the same friction yet again. “Joining another alliance is very unlikely although not impossible,” said Murphy. “But it would just open Maersk up to all of the challenges it already had with MSC.” Other hurdles to replacing MSC Several analysts believe that the 2M divorce will ultimately lead to a broader reshuffling of alliances. Vespucci Maritime’s Lars Jensen — who has been predicting the demise of 2M for months —  said in an online post, “My view is that this is only the beginning of a reshaping of the alliance/VSA constellations, especially on the major east-west trades. In essence, this should be seen as the first domino of many to fall over the next one to two years.” According to Verberckmoes, “In every alliance breakup, there is always an opening for new perspectives. We have seen in the past that every change in big alliance structures might trigger other changes.” But Murphy pointed to multiple hurdles, beyond the issue of Maersk’s integrator strategy.  In the case of 2M, Maersk and MSC were roughly equal-sized partners. Maersk would be the dominant partner of any alliance it joined. “You can bring in a Hyundai [HMM], because they’re tagging along, but to bring in an alliance partner that will now dominate the alliance would be very difficult,” he said. There’s also the regulatory challenge. Chinese regulators barred the proposed P3 alliance among MSC, Maersk and CMA CGM, prior to the formation of 2M. “Can you disallow P3 but allow the Ocean Alliance plus Maersk? I can’t see that,” said Murphy. Consultancy Drewry said in a research note on Wednesday, “Competition authorities will probably block any move [by Maersk] to join one of the other two alliances, which are contractually committed beyond the termination of 2M. Ocean Alliance runs to 2027 and THE Alliance to 2030.” Another possibility is that Maersk could woo away a carrier in one of the two remaining alliances, such as France’s CMA CGM, and create a new alliance. “That’s not impossible, because CMA CGM and Maersk cooperated in the past, prior to P3. But there are a lot of challenges with siphoning off someone like CMA CGM,” said Murphy. Cycle timing Yet another complication is cycle timing. “You have to remember that alliances were the consequence of massive oversupply,” said Murphy. Carriers overordered large-size vessels and needed alliances to fill them effectively. “Alliances come under pressure when things are going really well,” he continued. “There’s probably many a carrier that felt hemmed in and restricted by alliance obligations during the pandemic, because they couldn’t make tactical decisions on their own. “Are things going to go well for shipping lines over the next two years? Probably not. In my opinion, we’re heading into a repeat of 2015-16, with massive oversupply and freight rates at or below cost. It’s going to be a bad two or three years. “So, it makes no sense to leave an alliance now. But they’re not leaving an alliance now. They’re leaving in two years. It might make sense then. There is an expectation that at some point, [the market] will turn again. I assume that both shipping lines believe that when it does, they will be better positioned outside of an alliance.” As for Maersk finding a new alliance home, the market outlook is highly uncertain, raising questions about whether other carriers would be willing to play the game of alliance “musical chairs” in the midst of a container shipping recession. “I think the other alliance [partners] will be cautious about making any major changes now, heading into what is clearly a bear market,” said Murphy. Bearish or bullish for rates? Drewry outlined two scenarios in which the end of 2M could lead to lower shipping costs. In one, an independent MSC faced with rapid fleet growth could “return to its old market-share/low-cost model, which could destabilize the market.” In another, Drewry speculated that “a radical shake-up of the alliances” while “a remote possibility,” could “lead to carnage in the freight-rate market as new members court shippers over to their new teams.” But Verberckmoes and Murphy do not see the alliance situation lowering shipping costs. “I don’t think that alliances have had an impact on price,” said Verberckmoes. “If prices are declining, that means one or two carriers are going for market share, and I don’t think alliance changes have any effect on that. When it comes to rates, it is always the market that decides.” According to Murphy, “A lot of customers hate alliances and believe them to be the source of all evil in the world. I think a lot of shippers will look at this [the 2M breakup] and think this is good for them. “That depends on what they mean by ‘good.’ If they mean ‘cheap,’ probably not. In every simulation we’ve done where we look at how you could operate services more independently, with fewer VSAs and fewer alliances, the price goes up.” He argued that alliances have led to reduced freight costs, in part because members of alliances must compete with each other on price while providing the same ocean service. “In an alliance, you lose all product differentiation on your liner product,” said Murphy. “You’re offering the exact same product — which was a massive driver of very low freight rates pre-pandemic.” Tyler Durden Fri, 01/27/2023 - 05:00.....»»

Category: blogSource: zerohedgeJan 27th, 2023