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| Happy Wednesday, Insiders! These are our top stories today: - President Biden awarded the Medal of Honor to a helicopter pilot who disobeyed direct orders to save four U.S. troops in the Vietnam War
- Texas Attorney General Ken Paxton's impeachment trial in the Texas State Senate
- Birmingham, the second-largest city in the U.K., effectively declared bankruptcy this week
And much more! If you find this newsletter useful, please share it with your friends and colleagues. Your faithful IDB writer, Daniel
p/Dan-Smith | |
| 1 | | Birmingham, the second-largest city in the U.K., effectively declared bankruptcy on Tuesday after halting all non-essential payments. The city, which provides services to more than a million people, expects to have a deficit of £87M ($109M) in the 2023-2024 fiscal year. More: - Much of the city's financial problems come from being ordered to make equal pay claims to female employees who were underpaid relative to male employees.
- The equal pay claims total £760M ($954M).
- Sharon Thompson, deputy leader of the Birmingham council, said the city "had £1 billion of funding taken away" by the conservative Tory Party, which took power in 2010.
- Council leader John Cotton said the city's governing body would need to make "tough and robust decisions" to cut spending.
Zoom Out: - In 2012, the British Supreme Court ruled in favor of 174 mostly female plaintiffs who sued the city over gender imbalances in pay for civil servants.
- Since then, the Birmingham Council has paid out nearly £1.1B ($1.38M) in equal pay claims.
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| 2 | | AMC stock fell by nearly 30% on Wednesday after the beleaguered movie theater company said it would sell up to 40 million common shares of its stock. 
What the numbers say: AMC shares, which have lost over 70% this year, are on pace to close at a record low. The company plans to use the proceeds from the stock sale to pay off debt and improve its liquidity. Last month, AMC converted its preferred 'APE' stock to common stock and did a reverse stock split. That move came after AMC settled a lawsuit with investors who were opposed to the conversion. AMC, which became a favorite of "meme stock" traders during the COVID-19 pandemic, has sold millions of new shares in recent years. Relevance: Last week, AMC said it plans to distribute a concert movie based on pop star Taylor Swift's "The Eras Tour" starting in October, which is expected to bring in substantial revenues for the company. However, the delay of major releases, like "Dune 2," due to the ongoing Hollywood strike will undoubtedly hurt AMC and the movie theater business more generally, which has struggled to reach pre-pandemic sales levels. | | | |
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| 3 | | The impeachment trial of Texas Attorney General Ken Paxton began in the Texas Senate this week. Paxton, a right-wing Republican whom the GOP-led Texas House of Representatives impeached in May, has been investigated by the FBI over his alleged corruption. More: - Jeff Mateer, a conservative lawyer who was one of the first whistle-blowers to accuse Paxton of corruption, was the prosecution's first witness to testify in the impeachment trial.
- Paxton is accused of using his office to help a donor, Austin real estate developed Nate Paul.
- Earlier this summer, Paul was indicted on charges of making false statements to a bank in order to secure more than $170M in loans.
- In 2020, eight of Paxton's top deputies reported him to the FBI. If convicted, Paxton would be barred from holding elected office in Texas.
Zoom Out: - A two-thirds majority of Texas' 32 state senators must vote to impeach Paxton for him to be removed from office.
- 12 of those Senators are Democrats who will almost certainly vote for his impeachment.
- Sen. Angela Paxton, Ken Paxton's wife, will attend the trial but is barred from voting to convict or acquit her husband.
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| 4 | | GOOD NEWS: President Joe Biden awarded the Medal of Honor to a Vietnam War-era helicopter pilot who disobeyed direct orders in order to save four U.S. soldiers from near-certain death in 1968. Retired Army Capt Larry Taylor is now one of the 3,515 U.S. military personnel to receive America's most prestigious military medal. More: - On June 18, 1968, a long-range reconnaissance patrol team near Ho Chi Minh City was surrounded by enemy troops.
- Taylor had been ordered to return to base, but he chose to disobey the command when he realized that the four-man team would not be able to escape from their position.
- He flew his Cobra helicopter into the fray, taking fire from Vietnamese fighters as he landed.
- The men then held on to the exterior of the two-seat helicopter as he ferried them to safety.
- President Biden said that Taylor's unwillingness to "leave a fellow American behind ... rewrote the history of four families for generations to come."
- Biden noted that Taylor flew over 2,000 combat missions and earned 43 air medals during his Army service, joking: "Thank God he's not wearing all of them on his chest. He'd have trouble standing."
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| 5 | | The Bank of Canada left its benchmark interest rate unchanged at 5% on Wednesday. The central bank said that slowing growth and easing demand contributed to its decision to pause its rate-hiking campaign. More: - Canada's GDP shrank by an annualized 0.2% in the second quarter of 2023.
- The annual inflation rate accelerated to 3.3% in July but is down substantially from the peak of 8.1% seen last year.
- The Bank of Canada has hiked interest rates 10 times since March 2022, bringing its overnight rate to a 22-year high.
- The bank said that previous rate hikes have been successful in lowering spending and that slowing growth will help to "relieve price pressures."
Zoom Out: - The Canadian central bank raised interest rates in June and July.
- The Federal Reserve, by comparison, paused its rate-hiking campaign in June for the first time since March 2022.
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| 6 | | Moderna said that its latest COVID-19 vaccine appears to be effective against the new "Pirola" omicron strain that public health officials are tracking. COVID-19 cases are on the rise in the U.S., with hospitalizations and deaths rising by 87% and 70% over the past month, respectively. More: - The highly mutated BA.2.86 omicron variant, also known as Pirola, has been found in four states and is seen as a possible contender to replace the currently dominant EG.5, or "Eris" variant.
- In recent weeks, Moderna said that its latest vaccine provides protection against Pirola, Eris, and the so-called "Fornax" variant.
- Eris and Fornax accounted for 21.5% and 14.5% of all U.S. cases as of Saturday.
- The Center for Disease Control and Prevention (CDC) identified the Pirola strain in four states but has not yet listed it as a standalone strain on its variant tracker
Q: Are you worried about an uptick in COVID cases? Join the debate here. | | | |
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- Fewer mortgage applications were submitted in the U.S. last week than in any week since December 1996.
- A new study examining global health data found that cancer cases among people under 50 rose by 79.1% over the past three decades.
- Spanish footballer and Women's World Cup winner Jenni Hermoso filed criminal charges against Luis Rubiales, the now-suspended president of Spain's football federation, for kissing her on the lips without her consent after Spain's World Cup victory last month.
- Streaming company Roku said that it would lay off 10% of its ~300-person workforce. The company's stock rose more than 10% following the news.
- Instacart, ARM, and Klaviyo just filed for an IPO. Get access to the Top 25 pre-IPO deals like Stripe, OpenAI Databricks and Anduril.*
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Term of the Day Cost of goods sold (COGS): COGS refers to the direct costs of producing or acquiring the goods that a company sells to its customers. Question of the Week Do you share details about your salary with your coworkers? Join the conversation |
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 | Writer | | Dr. Daniel Smith is an Inside writer with a Ph.D. in Political Science from the University of Cambridge. Follow him on Twitter @DJS12321 or email him at Daniel@inside.com. | | This newsletter was edited by NO ACCOUNT ASSOCIATED WITH THE EDITOR | |
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