The Chinese government stepped in to take control of Anbang, a giant insurer with more than $300bn in assets, following months of state attempts to rein in the company’s growing debt. Wu Xiaohui, who transformed Anbang from a tiny car-insurance firm to a powerhouse acquiring stakes in foreign hotels and financial assets, is charged with “economic crimes”. It was that expansion, underscored by the purchase of the Waldorf Astoria hotel in New York in 2014, that China’s regulators came to view as a threat to financial stability.
More companies distanced themselves from the gun lobby in the aftermath of the mass shooting at a school in Florida. Walmart said it would prevent people aged under 21 from buying guns, as did Dick’s Sporting Goods, which will also stop selling semi-automatic rifles. But the power of the gun lobby is undiminished; Republicans in Georgia have moved to chop a tax break for Delta Air Lines in retaliation for its decision to end a discount scheme for members of the National Rifle Association.
Berkshire Hathaway reported a total gain in net worth last year of $65bn, $29bn of which came from reassessing the potential tax liabilities on its portfolio of shares in light of the lower corporate-tax rate passed by Congress. The gain helped boost annual net profit at Warren Buffett’s company to $45bn, from $24bn in 2016.
India’s GDP grew at an annual rate of 7.2% in the last three months of 2017. With the government spending more on infrastructure and welfare, the economy has rebounded from the twin hits of a surprise monetisation programme and the implementation of a goods and services tax.
The revelation that Geely, a Chinese carmaker, had accumulated a 9.7% stake in Daimler raised eyebrows in Germany. Geely built the stake through derivatives, so it did not have to notify German authorities when it passed holdings of 3% and 5%.
A federal court in Germany ruled that the cities of Dusseldorf and Stuttgart could ban older diesel cars from their streets. The government, which is against the ban, tried to calm drivers and carmakers, saying this did not mean further bans were imminent. Sales in Europe have declined sharply in recent years as several countries have announced the phasing out of diesel-powered cars that emit polluting nitrogen oxides. See article.
The new-reality TV
Rupert Murdoch’s plan to sell 21st Century Fox’s entertainment assets to Disney hit a new snag when Comcast submitted a surprise bid for Sky, Britain’s premier subscription-TV broadcaster. Fox owns 39% of Sky and is trying to buy the remaining 61% (it would then sell the entire 100% to Disney) but has met resistance from Britain’s competition regulator. See article.
Amazon agreed to buy Ring, which makes video doorbells that enable householders to use their phones and computers to see who has come calling. The deal is said to be worth $1bn, making it one of Amazon’s biggest acquisitions.
Avoiding a conventional IPO, Spotify filed papers to list its shares directly on the New York Stock Exchange. The music-streaming service will offer its existing shares to the public rather than issue new ones. It has warned that trading will be volatile.
The tough environment for Britain’s bricks-and-mortar retailers claimed two more victims. The British arm of Toys “R” Us and Maplin Electronicswent into administration, putting 5,300 jobs at risk.
Royal Bank of Scotland’s share price was weighed down by concerns about its exposure to charges in America of mis-selling mortgage-backed securities. The bank reported its first annual profit in a decade. In 2017 RBS made a profit of £752m ($968m), following accumulated losses over the previous nine years of £58bn. See article.
Stockmarkets wobbled and the dollar rose as investors interpreted Jerome Powell’s remarks on the strength of the American economy to mean that the Federal Reserve is on course to raise interest rates four times this year. Mr Powell made his comments during his first testimony to Congress as Fed chairman. See article.
Hide from seek
Google revealed that it had received requests to remove 2.4m web addresses from its search engines following the European Court of Justice’s ruling in 2014 that people have “the right to be forgotten”. That is far from being a “right”. Google has not delisted 57% of the sites, in part because they contain information which is “in the public interest”. That policy is being put to the test by a businessman in London, who is in court challenging Google’s decision not to remove his conviction for accounting fraud from searches.