Microsoft cuts about 1,000 jobs - Axios

FILE PHOTO: Illustration shows small figurines and displayed Microsoft logo

Tue, October 18, 2022 

(Reuters) - Microsoft Corp laid off under 1,000 employees across several divisions this week, Axios reported on Tuesday, citing a source, making it the latest U.S. technology company to cut jobs or slow hiring amid a global economic slowdown.

The layoffs affected less than 1% of Microsoft's total workforce of around 221,000 as of June 30.

The company had said in July that a small number of roles had been eliminated and that it would increase its headcount down the line.

Microsoft did not immediately respond to a Reuters' request for comment on the Axios report.

Several technology companies, including Meta Platforms Inc, Twitter Inc and Snap Inc have cut jobs and scaled back hiring in recent months as global economic growth slows due to higher interest rates, rising inflation and an energy crisis in Europe.

(Reporting by Jyoti Narayan in Bengaluru; Editing by Savio D'Souza)

Recession-proof Microsoft lays off nearly 1,000 employees across the company

Christiaan Hetzner
Tue, October 18, 2022 

Four years ago Microsoft dedicated a glowing portrait to KC Lemson in order to properly celebrate her contribution as the creator of its unofficial yet beloved Ninja Cat mascot.

On Monday, the trailblazing “maestro of fun, mastermind of memes,” as Microsoft described her, found out she had been laid off from the software company she loved after more than two decades.

“I’ve got a good network and sent a lot of feelers out today, but there just aren’t many openings,” she posted late on Monday in the kind of statement that is sounding increasingly familiar as the tech industry braces for a recession.

Lemson was one of up to 1,000 employees who received the dreaded pink slip. According to a report by Axios, the layoffs were spread out across a variety of staffing levels, teams, and regions of the world.

https://twitter.com/kclemson/status/1582175419268501504?s=20u0026t=lqnAXmmyQ_Caa1m5_Txpcg

“Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly. We will continue to invest in our business and hire in key growth areas in the year ahead,” Microsoft said in a statement to Axios.

The cutback wasn’t dramatic when compared with the scale of other recent staff reductions announced or rumored recently. Some 221,000 people worked at Microsoft as of the end of June.

Yet when a bellwether like Microsoft feels the need to wield the axe, it’s a grim sign of broader tech weakness—especially after the company already trimmed staff in July. Microsoft has generally been considered to be recession-proof, one of the few resilient stocks that investors should hold in a downturn.

The software giant could therefore be the “next shoe to drop,” Jordan Klein, managing director for tech, media, and telecom sector trading at Mizuho Securities, said in a note to clients last week: “Post AMD (warning) and the much weaker PC read-through last week, I see growing earnings risk facing Microsoft in coming quarters.”

The company reports fiscal first-quarter earnings next Tuesday after U.S. markets close.

Top destination for CIO tech spend

Professional investors continue to favor the stock owing to its dominant Office suite of productivity software; the Azure cloud-computing business that remains a key growth driver; and a management team around CEO Satya Nadella that is considered to be one of the best in the industry.

In July, the software developer nabbed a flagship deal with Netflix to support its new lower-priced ad-tier subscription. Last week it partnered with Meta to offer a more immersive experience for corporate customers using Mark Zuckerberg’s upcoming Quest Pro virtual reality headset, complete with security and compliance features.

“Inflationary pressures, recessionary concerns, and things like that tend to bite more harshly on the consumer side of the equation,” Raymond James analyst Andrew Marok told Yahoo Finance earlier this month. “Whereas with an enterprise software company like Microsoft dealing with such a wide product portfolio—from productivity software to public cloud to operating systems and beyond—we think the environment for a company like this with the scale it has is very advantageous.”

https://www.youtube.com/watch?v=6wnI1_RDzeo

With a market cap of $1.8 trillion, Microsoft is the world’s third most valuable company behind tech rival Apple and oil producer Aramco. Although shares have fallen 29% year to date, it has outperformed a 32% decline in the broader Nasdaq 100 tech index.

According to finance site MarketBeat, 29 analysts covering the stock rate it a buy or outperform, versus just three hold recommendations and zero sell ratings.

Bulls therefore argue chief information officers will continue to snap up Microsoft products as companies look for a way to stretch their increasingly limited budgets going into a possible recession.

“The solution to getting us out of the tight labor market is tech capex. CIOs are increasing their spend on software, cloud; and infrastructure is important and cybersecurity—you get all of that with Microsoft,” said Nancy Tengler, CEO of Laffer Tengler Investments, on CNBC. “They’re the top tech spend through 2025 according to CIO surveys.”

For Lemson and the hundreds like her, however, that’s little consolation right now.

Microsoft mum on Boston-area impact of reported layoffs


One of Microsoft's Massachusetts offices is located at One Memorial Drive in Cambridge.


By Lucia Maffei – Technology Reporter, Boston Business Journal
Oct 18, 2022

Microsoft Corp. (Nasdaq: MSFT) did not say if and how its reported layoffs across multiple divisions will impact its New England hub.

The Redmond-based tech giant (Nasdaq: MSFT) is cutting under 1,000 positions across a variety of levels, teams and parts of the world, per a report in Axios Monday. A number of layoffs have started this week, according to a follow-up story in the Wall Street Journal.

Join the Boston Business Journal to unlock even more insights!

Asked about the impact of the job cuts on the company's Massachusetts workforce, a spokesperson for Microsoft sent over a prepared statement.

"Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly," a Microsoft spokesperson wrote. "We will continue to invest in our business and hire in key growth areas in the year ahead."

The company did not say how many employees it currently has in the Bay State.

Microsoft New England has offices across Cambridge, Burlington and Acton. Local teams work on research, machine learning for Microsoft's cloud Azure, artificial intelligence and semantic machines.

Cambridge is also home to The Garage, Microsoft's own community and learning space for employees. Opened in 2018, the approximately 15,000-square-feet space is located on the second floor of the Microsoft New England Research and Development Center (also known as N.E.R.D.) in Kendall Square.

In March this year, Microsoft completed its $19.7 billion acquisition of Burlington voice-tech company Nuance Communications Inc. At that time, a spokesperson for the tech giant said the company planned to integrate the two teams. Nuance had about 7,100 full-time employees, including 45% based in the U.S.

As of June this year, Microsoft employed approximately 221,000 full-time employees, including 122,000 in the U.S, according to public documents.

Several tech companies have paused expansion plans, implemented hiring freezes or made layoffs after a slowdown in growth tied to a lackluster economic outlook. Facebook parent company Meta Platforms Inc. (Nasdaq: META) also disclosed plans to contain headcount and said it was aiming to build a smaller company in 2023. Facebook also remained silent over the potential impact of such plans on Greater Boston.

Cuts at Microsoft came after the company noted in its most recent earnings report in July how "evolving macroeconomic conditions and other unforeseen items" negatively impacted financial results. Unfavorable foreign exchange rate, extended production shutdowns in China, reductions in advertising spend and the decision to scale down operations in Russia due to the ongoing war with Ukraine accounted for losses worth hundreds of millions, according to a release. For fiscal 2022, the company reported a profit of $72.7 billion on a $198.3 billion revenue.

"As we begin a new fiscal year, we remain committed to balancing operational discipline with continued investments in key strategic areas," said Microsoft CFO Amy Hood in a July statement.

This 33-year-old made more than 1,000 Wikipedia bios for unknown female scientists


Timothy Harper
Sun, October 16, 2022 


When Jessica Wade was invited to Buckingham Palace to receive the prestigious British Empire Medal, she stood out for being a young woman honored for her contributions to science.

Ironically, she was being honored for trying to change that.

Wade, 33, physicist based in London, has become something of a phenomenon herself in her very personal campaign to bring more girls to study and work in STEM (science, technology, engineering and mathematics).

Wade has written more than 1,600 Wikipedia entries about long-ignored female scientists, and she has firm beliefs about how to support girls interested in the field.

Jessica Wade. (Courtesy Jess Wade)

Wade gained notice in her 20s when she began writing the Wikipedia biographies about female and minority scientists who never got their due — from employers, from other scientists, from the public.


As her Wikipedia entries climbed into the dozens and then into the hundreds, she spoke and wrote more about gender equality in science. She won awards and medals and was cited by Jimmy Wales, the founder of Wikipedia.

However, not all of Wiki-world was happy with her. Several of her entries were deleted by other Wikimedians, as the most influential contributors and editors are called. She told TODAY.com that they said a handful of the women she wrote up were not all that well-known.

Wade says that’s the problem.

One example was Clarice Phelps. Wade heard about the young African American nuclear chemist and wrote a Wikipedia bio describing her work on a team that discovered a new periodic table element at Oak Ridge National Laboratory in Tennessee.

The Phelps entry bounced on and off Wikipedia as critics deleted it and Wade defended it. Wade won in the end, and Phelps' entry is back on Wikipedia for good.

Jessica Wade high-fives an audience member at a presentation. (Courtesy Jess Wade)

Meanwhile, Wade’s own Wikipedia entry — written by others — has grown to 10 printed pages.

As Wade pursues her effort to make sure female scientists are known, she also has beliefs about how to make sure the next generation gets the support it needs.

She said girls don’t need “whiz-bang” experiments at school assemblies: Visiting scientists do their show, pack up, depart and nothing changes. Instead, girls and students of color need to be coached and mentored about what to study and when.

“People assume girls don’t choose science because they’re not inspired,” Wade said in a recent interview. “Girls are already interested. It’s more about making students aware of the different careers in science and getting parents and teachers on board.”

Women make up only 28% of the U.S. workforce in STEM, according to the American Association of University Women, and only 1 in 5 current engineering or computer science majors are women. Women in STEM earn $60,000 a year, compared to $85,000 for men, the nonprofit group says.

“Ultimately, we don’t only need to increase the number of girls choosing science. We need to increase the proportion of women who stay in science,” said Wade, whose doctoral research at Imperial College London has been widely cited for advances in digital display technology for TV, computer and phone screens.

One key, she said, is better high school science teachers.

“We’re suffering a huge shortage of skills-specialist science teachers across the U.S. and the U.K.,” she said.

Wade said schools should make it easier for girls and students of color to apply for admissions, grants, fellowships and promotions.

Jessica Wade. (Courtesy Jess Wade)

She believes schools need to be upfront about their policies on bullying and sexual harassment, that universities must provide affordable child care on campus and that conference organizers should provide day care and grants for those with caring responsibilities.

Wade, who grew up as the daughter of two physicians and had supportive teachers at private schools, realized at a young age that most people were not as lucky.

“I genuinely believe that science is better when it’s done by diverse teams,” she said.

“It’s also important because we’re designing new technologies or new scientific solutions to global problems. We want the teams of people creating them to reflect the societies that they’re serving.

“Even if you don’t care about any of that, the world desperately needs more scientists and engineers,” Wade added. “Science can help solve the world’s biggest challenges — climate change, antibiotic resistance, emerging pandemic-inducing viruses.”

Looking back on her inclusion in the late Queen Elizabeth’s 2019 Birthday Honours list, Wade hopes young female scientists will become common at future ceremonies.

“It was pretty wild to be honored by the royal family,” Wade recalled. She didn’t meet the queen, but she did take her mother, Dr. Charlotte Feinmann, to Buckingham Palace with her.

Her father, Dr. John Wade, couldn’t attend, but Jessica Wade did her best to make it up to him.

“I took a Tupperware to sneak some royal sandwiches home to my dad," she said.

This article was originally published on NBCNews.com

 Amazon warehouse workers in NY state vote against union

Alexandra Garfinkle

·Senior Reporter

Tue, October 18, 2022

Amazon (AMZN) workers at a warehouse near Albany, New York voted against joining the Amazon Labor Union (ALU), in a blow to a union that had a historic victory at JFK8 in Staten Island earlier this year.

The final count was 406 against the union, and 206 for the union, with 31 challenged ballots. The warehouse, which is at Castleton-on-Hudson, represented the ALU's first attempt at organizing outside New York City, coming after its win in Staten Island.

"This isn't a surprising outcome — unions have long been reluctant to take on companies like Amazon because you're so unlikely to win," said John Logan, director of labor studies at San Francisco State University.

Amazon workers in New York haven't been alone in expressing dissatisfaction with the company. Last week, Amazon workers participated in high-profile walkouts and strike actions at Amazon facilities in California, Illinois, and Georgia. The California walkout took place at an air facility in San Bernardino — less than 20 miles from Moreno Valley, where workers looking to be represented by the ALU almost simultaneously filed for an election with the NLRB.

"The difficulty at Amazon is that getting the 30% support to trigger an election is already a victory, especially given the incredible rate of turnover at Amazon facilities," Logan said.

The reality is this, Logan said: A win near Albany would have made a huge difference.

"This would have been a huge boost, each one of these victories do inspire young workers," Logan added. "It's going to be tough, there's no doubt. This loss does partly show that there are benefits to an established union — setbacks like this can be difficult to manage, and resources to push on can make a difference."

For its part, Amazon has been making moves to boost its reputation as an employer. The company announced plans last month to spend $1 billion raising pay for its warehouse and delivery workers, putting the starting wage for most of those employees at $19 an hour. The company's minimum wage for hourly workers remains at $15 an hour, about twice the national minimum wage and roughly aligning with the state minimum wages in New York and California.

“We’re glad that our team in Albany was able to have their voices heard, and that they chose to keep the direct relationship with Amazon as we think that this is the best arrangement for both our employees and customers," Amazon spokesperson Kelly Nantel said. "We will continue to work directly with our teammates in Albany, as we do everywhere, to keep making Amazon better every day."

What comes next

For the warehouse near Albany, it's possible that the ALU may back off in the near-term because it doesn't have many options. For one, the 31 challenged ballots are off the table from here.

"The labor board will only litigate challenges as to individual voters if it's outcome-determinative," said Andrew MacDonald, labor and employment partner at Fox Rothschild. "Because the challenges aren't outcome-determinative here, that avenue is closed off."

Objections are also possible, but a huge investment of time and money.

"As an independent union, it's unclear if it'll be worth it to the ALU to offer up those resources," said MacDonald. "It's unclear how to read an independent union as opposed to a more established union, where you can look at long-term trends."

There's reason to suspect that the Amazon Labor Union might turn its attention to a Moreno Valley, C.A. warehouse where workers recently petitioned for an election, seeking representation by the ALU.

"I think if you're the ALU, and you have a new petition, you invest more of your energy in California," said MacDonald.

However, the petition phase can be a fragile one, said MacDonald.

"The union is constantly testing its support, and can pull the petition if they feel support is dwindling," he told Yahoo Finance.

Still, it's fairly likely a vote will come to pass where a petition is filed, as is the case in Southern California.

"In most cases if a petition is filed, there will be an election," said MacDonald.

From here, there are also opportunities for data-gathering and strategizing on both sides, who will be operating with the expectation that these labor fights will continue, according to Syracuse University professor Lynne Vincent.

"From here, ALU can try to determine the major factors in employee decisions and see how they can address those for future campaigns," she said. "For Amazon, it means that their campaign countering union organization still works. Amazon may try to answer some of the same questions that ALU needs to answer. What are the differentiating factors for the different warehouses, and how do we leverage those?"

Ultimately, despite this setback, it's unlikely that organizing and union activity will stop at Amazon, or its counterparts like Apple (AAPL) and Starbucks (SBUX), despite an increasingly challenging macroeconomic environment, according to Vincent.

"With the current economic and political undercurrents, employee discontent and frustrations are not going to dissipate," Vincent said. "This union movement surge has been building for a long time, and I do not believe that we have seen its peak."

An Amazon Labour Union (ALU) organizer greets workers outside Amazon’s LDJ5 sortation center, as employees begin voting to unionize a second warehouse in the Staten Island borough of New York City, U.S. April 25, 2022. REUTERS/Brendan McDermid.

The ALU hasn't returned Yahoo Finance's request for comment, but ALU president Chris Smalls issued a statement on Tuesday, suggesting this is far from over.

“Most of all, we are filled with resolve to continue and expand our campaign for fair treatment for all Amazon workers," the statement reads. "You miss 100% of the shots you don’t take.”

NDP calling on Smith to apologize for 'tone deaf' and 'cruel' comments on Ukraine war


EDMONTON — Alberta’s Opposition NDP says Premier Danielle Smith needs to apologize for her remarks on the Russia-Ukraine war.


NDP calling on Smith to apologize for 'tone deaf' and 'cruel' comments on Ukraine war© Provided by The Canadian Press

Opposition critic Sarah Hoffman said it was “tone deaf” and “cruel” for Smith to urge Ukraine to accept neutrality, even as its people were fighting and dying in the Russian invasion.

Smith also opined on social media earlier this year that there may be parts of Ukraine happier to break away from the mother country.

“The fact she refuses to apologize leads one to believe that she does believe the things that she said, that she doesn’t have remorse, that she is absolutely choosing to side with (Russian President) Vladimir Putin over the people of Ukraine who are fighting for their lives,” Hoffman said Monday.

Hoffman said the comments strike a particular sore point in Alberta, which is home to about a quarter of all Canadians of Ukrainian heritage.

The quotes surfaced over the weekend after a freelance journalist published comments Smith made on social media platforms prior to her ultimately successful bid to become leader of the United Conservative Party and premier.

On a livestream chat on April 29, Smith said: “The only answer for Ukraine is neutrality,” adding she understands why Russia would have a concern with a western-aligned Ukraine armed with nuclear weapons on its doorstep. Ukraine surrendered its nuclear weapons in the 1990s.

In a Feb. 24 post, she said: "I’ve read that two regions of Ukraine feel more affinity to Russia. Should nations be allowed to break away and govern themselves independently? If that’s truly what people want, then I think so. But is that what the people want — or is it propaganda?”

Smith’s office did not respond to questions surrounding Smith’s current opinions on Ukraine, but pointed to the statement from a day earlier, when Smith said she supports the Ukrainians who are “suffering indescribable horrors and loss at the hands of an invading power.”

Her office also instead pointed to comments Smith made earlier Monday in an interview on Corus Radio.

“I suppose we could kind of relitigate every statement that I have made in the past and with the different hats that I've worn,” Smith told host Shaye Ganam.

“(But) when I talk to the public, what they're interested in knowing is what I'm going to do going forward.”

Smith added it’s not her role to comment on the war.

“I respect federal jurisdiction,” she said. “It’s up to them to weigh in on international relations and negotiations."

She said Alberta will focus on delivering humanitarian aid while helping Ukrainian refugees and resettlement, saying: “That, to me, is us staying in our lane."

Alberta committed $23 million in Ukraine relief under former premier Jason Kenney, who was outspoken in his denunciation of Putin.

“We’ve seen the unmitigated violence, the pure evil coming from the heart of Vladimir Putin to indiscriminately attack people that he calls his brothers,” Kenney said on Oct. 4.

In Ottawa, NDP foreign affairs critic Heather McPherson called Smith's comments "horrific" and "incredibly dangerous rhetoric," essentially suggesting Ukraine should "roll over" in response to Russian aggression.

"How do you remain neutral when your country has been invaded, when there has been a genocide being committed against your people?" the Edmonton member of Parliament said outside the House of Commons.

The Ukraine comments are one of a number of policy controversies during Smith’s first week in office.

Smith has been criticized for saying she believes COVID-19 unvaccinated people are the most discriminated group she has seen in her lifetime. She has also promised no more vaccine mandates for health-care workers, which she says would lure more staff to Alberta, but critics say would lead them to seek jobs elsewhere.

Hoffman said she is not surprised Smith is urging Albertans to ignore past comments.

“She certainly wants to tell people not to pay attention to her own words," she said. "I get why she’d say that. She has said many offensive and hurtful and damaging things for the province of Alberta.”

This report by The Canadian Press was first published Oct. 17, 2022.

Dean Bennett, The Canadian Press

Nouriel Roubini: Why AI poses a threat to millions of workers

Daniel Howley

·Technology Editor

Tue, October 18, 2022 

Business sectors ranging from agriculture and manufacturing to automotive and financial services are increasingly turning to artificial intelligence as a means to automate large swaths of their organizations—and, along the way, save enormous sums through improved efficiencies.

But, says ‘Megathreats' Author and NYU Stern School of Business professor Nouriel Roubini, the rise of AI will also have a massively negative impact on workers throughout the economy.

AI has helped revolutionize everything from the smartphones in our pockets to our grocery stores, which use the technology to better predict which items customers want to see on shelves. However, Roubini, whose prediction of the 2008 financial crisis earned him the moniker “Dr. Doom,” says AI poses a threat to millions of workers.

“The downside is that while AI, machine learning, robotics, automation increases the economic pie, potentially, it also leads to losses of jobs and labor income,” Roubini said during an interview at Yahoo Finance’s All Markets Summit.

Take autonomous cars. While they could dramatically reduce the number of car accidents, significantly cutting down on the number of deaths and injuries caused on the nation’s roadways, they’ll also put millions out of work. “You have, what, 5 million Uber and Lyft drivers, 5 million truckers and teamsters, and they’re going to be gone for good,” Roubini said. “And which jobs are they going to get?

CERNOBBIO, ITALY - SEPTEMBER 07: Nouriel Roubini professor of economics at New York University attends the Ambrosetti International Economic Forum 2019 "Lo scenario dell'Economia e della Finanza" on September 6, 2019 in Cernobbio, Italy. (Photo by Pier Marco Tacca/Getty Images)

Fully autonomous vehicles are still years away from hitting the roads. The majority of the technology that’s currently available is meant to assist drivers rather than actually control vehicles themselves. But automakers have made it clear that they are intent on developing the technology to the point where there’s no need for a driver at all.

But according to Roubini, it’s not just drivers and truckers who might be at risk of losing their jobs. As AI becomes more powerful, it could be used to replace workers in creative fields including the arts.

“Increasingly, even cognitive jobs that can be divided into a number of tasks are also being automated,” Roubini said. “Even creative jobs; there are now AIs that will create a script or a movie, or make a poem, or write...or paint, or even [write] a piece of music that soon enough is going to be top 10 in the Billboard Magazine chart.”

While it might be some time before AI is winning any major awards or art prizes, if ever, it is being used to create digital art. Take the open-source DALL-E, which allows users to type in a series of words and get an image based on millions of photos pulled from the internet.

While artists are unlikely to disappear anytime soon, the fact that AI is racing into once unimaginable sectors of the economy could eventually mean Roubini's prognostications, like some of his others, will prove true.

Key Takeaways From Xi Jinping’s Two-Hour Speech



(Bloomberg) --

President Xi Jinping delivered a wide-ranging speech Sunday laying out the Communist Party’s agenda for China over the next five years, covering everything from Taiwan to tech policy.

Here are the key takeaways:

Foreign Policy

Xi: “China’s international influence, appeal and power to shape the world has significantly increased.”

“Confronted with drastic changes in the international landscape, we have maintained firm strategic resolve and shown a fighting spirit. Throughout these endeavors, we have safeguarded China's dignity and core interests and kept ourselves well-positioned for pursuing development and ensuring security.”


The context: Xi declared China would “standi tall and firm in the East” at the last congress in 2017, departing from former leader Deng Xiaoping’s “hide and bide” strategy. That shift along with Beijing’s moves to crush dissent in Hong Kong and Xinjiang, lack of transparency on Covid’s origins, partnership with Russia and more aggressive posture toward Taiwan and the South China Sea, has put China on a collision course with the West.

Development Model

Xi: “Chinese modernization offers humanity a new choice for achieving modernization.”

The context: China had long stressed that its development path is unique and does not follow traditional Western approaches based on capitalism. Xi elaborated on what the Chinese model, saying it is peaceful and based on maintaining the leadership of the party, realizing high quality growth and achieving "common prosperity." While officials previously stressed the country does not seek to export its development model, Beijing has shown increasing ambition to reform the global governance system by offering alternatives.Common Prosperity

Xi: "We will steadfastly push for common prosperity. We will improve the system of income distribution. We will ensure more pay for more work and encourage people to achieve prosperity through hard work. We will promote equality of opportunity, increase the income of low income earners and expand the size of the middle income group. We will keep income distribution and the means of accumulating wealth well regulated."

The context: Xi elevated the common prosperity slogan last year amid crackdowns on thebig tech, education and real estate sectors, drawing unease from investors who saw heavy losses from sudden policy shifts. That campaign to narrow China’s wealth gap fell out of the limelight this year as Covid lockdowns battered the economy. Today, Xi made clear it’s still high on the priority list.

Covid Zero

Xi: “In responding to the sudden attack of Covid-19, we put the people and their lives above all else and tenaciously pursued a dynamic Zero Covid policy. We have protected the people's health and safety to the greatest extent possible and made tremendously encouraging achievements in both epidemic response and economic and social development.”

The context: Anyone looking for signs China’s Covid strategy, which has kept its virus death toll low at growing economic and social costs, would have been disappointed. Xi signaled the zero-tolerance strategy he’s a cornerstone of his leadership is going strong, even as public tolerance for it appears to be cracking.

Economy

Xi: “High-quality development is the top priority of building a socialist modern country in all aspects. Development is the party’s top priority in governing. It's impossible to build a socialist modern strong country in all aspects without solid material and technology foundation.''

The context: Despite some analysts suggesting there may be a slight shift in Xi's speech to elevate national security at the expense of economic growth, Xi repeated the slogan from previous party congress speeches that development is the party's "top priority.'' Some China observers had expected Xi to give equal weighting to security and development, a signal that Beijing could tolerate slower economic growth in order to meet other policy goals. By sticking to earlier language, Xi's speech suggests no real departure from economic goals.

Taiwan

Xi: “We will continue to strive for peaceful reunification with the greatest sincerely and the upmost effort, but we will never promise to renounce the use of force, and we reserve the option of taking all measures necessary. The wheels of history are rolling on towards China's reunification and the rejuvenation of the Chinese nation. The complete reunification of our country must be realized and it can without a doubt be realized.”

The context: Xi reaffirmed the party line on Taiwan, one of Beijing’s main points of acrimony with the US. Beijing sees the self-governing island as its territory and has ramped up military pressure over the past year. President Joe Biden has repeatedly said the US would come to the democracy’s aid if attacked, marking a shift in the policy of “strategic ambiguity” that guided US-China relations for decades — even as the White House insists nothing has changed.

Hong Kong

Xi: “In the face of turbulent developments in Hong Kong, the central government exercised its overall jurisdiction over the special administrative region as prescribed by China's Constitution and the Basic Law of the Hong Kong Special Administrative Region. It ensured that Hong Kong is governed by patriots. Order has been restored in Hong Kong, marking a major turn for the better in the region.”

The context: Beijing imposed a national security law on Hong Kong that bans terrorism, secession, subversion and collusion with foreign force in June 2020 to quell anti-government dissent, after city-wide protests erupted a year prior. Several pro-democracy media outlets have closed under a pressure campaign from that legislation, which has been used to jail scores of opposition leaders and been condemned by the US and other Western democracies for diminishing freedoms in the former British colony.

Tech Crackdown

Xi: “We will focus on national strategic needs, gather strength to carry out indigenous and leading scientific and technological research, and resolutely win the battle in key core technologies.”

The context: China’s crackdown on its once-swaggering tech industry erased more than $1 trillion in combined market value, battering major firms such as Alibaba Group Holding Ltd. and Tencent Holdings Ltd. Xi’s speech struck a more optimistic note, instructing the sector to focus on innovation as the US moves to cut it off from cutting-edge chip capabilities.

Military

Xi: “We will intensify military training under combat conditions across the board to see that our armed forces can fight. We will innovate new military strategic guidance and develop strategies and tactics for people’s war, establish a strong system of strategic deterrence, increase the proportion of new domain forces with new combat capabilities, and intensifying military training under combat conditions

The context: Xi has vowed to modernize the once infantry-dominated military by 2027. To achieve that goal, the People’s Liberation Army has undergone tremendous organizational changes and hardware upgrades. The ground force has been trimmed, while other services including navy and rocket force have gained prominence.

Green Goals

Xi: “We will work actively and prudently toward the goals of reaching peak carbon emissions and carbon neutrality. Based on China’s energy and resource endowments, we will advance initiatives to reach peak carbon emissions in a well-planned and phased way, in line with the principle of getting the new before discarding the old.”

The context: More than any other leader of the Chinese Communist Party, Xi has sought to make the environment part of his lasting legacy. He’s dramatically cut air pollution that plagued urban residents and laid out ambitious goals for China including a target to reach net-zero emissions within four decades. But a spate of power shortages throughout the nation and global energy turmoil following Russia’s war in Ukraine have shifted the focus back on energy security, with climate goals coming in a distant second place.

(Updates with Xi’s comments on modernization.)

More stories like this are available on bloomberg.com

©2022 Bloomberg L.P.

Firefly Launches, Northrop Grumman Cheers

By Rich Smith – MOTLEY FOOL

KEY POINTS

Firefly Aerospace rang in October with a mostly successful test flight of its Alpha rocketship.

Northrop Grumman is depending on Firefly to produce new "Miranda" engines to power Northrop's newest rockets.

Good news for Firefly (which isn't public) is, therefore, good news for Northrop Grumman (which is).

Good news for Firefly Aerospace is good news for Northrop Grumman.

Firefly Aerospace is on a roll.

At 3:01 a.m. ET on Oct. 1, Firefly successfully launched its FLTA002 "Alpha" rocket into orbit, deploying three satellites as its payload and claiming 100% mission success on its second attempt to reach orbit.

Not everyone agrees that the mission was 100% successful. Critics point out that Firefly's satellite payloads ended up in suboptimal orbits, so they fell back to Earth faster than planned. But even if you call the mission only "mostly successful," Firefly seems ready to take first place among the new breed of small rocket launching companies in at least one respect: With a 1-ton payload capacity to Low Earth Orbit (LEO), its Alpha rocket offers a more robust alternative to Virgin Orbit's (NASDAQ: VORB) LauncherOne, with its 500 kg capacity, or Rocket Lab's (NASDAQ: RKLB) Electron rocket, which can carry 320 kg to LEO.

And that's not all. Just hours before the mission launched, the company landed a $17.6 million U.S. Space Force contract to launch a "rapid response" mission in 2023, proving it can prep and launch a small satellite into orbit with just 24 hours' notice. (Between now and then, Space News reports that Firefly will conduct a second launch, this time of a Venture Class satellite for NASA, later this year). All of the above is great news for Firefly Aerospace -- a veritable phoenix story of a once-bankrupt company coming back to life.

But Firefly's success may be even more important to another company entirely: Northrop Grumman 

As you may recall, Northrop Grumman has run into some roadblocks with its space program. No sooner had Northrop purchased rocket maker Orbital Sciences and merged it into Northrop's new "Space Systems" division ($10.6 billion in annual revenues now, or about 30% of all Northrop's revenues, according to data from S&P Global Market Intelligence), than Russia invaded Ukraine, causing two problems. First, Russia was supplying RD-181 engines for Northrop's rocket, and under America's sanctions regime, those engines could no longer be imported from Russia. And second, Ukraine was building Antares' entire first stage -- which was hard to do while being shelled by Russia.

Without those engines and without those rockets, Northrop would have a hard time performing its multibillion-dollar NASA contract to resupply the International Space Station by rocket.

Northrop announced its solution to both problems in August when it "joined forces" with Firefly Aerospace to "provide an American-built first-stage upgrade for the Antares rocket and a new medium launch vehicle [MLV] to serve commercial, civil and national security space launch markets."

Now, the "Reaver" engines that lifted Firefly's rocket to orbit last week were not the same engines Northrop will use on either the Antares 330 or the MLV. Firefly will develop new "Miranda" engines for these purposes. Regardless, the fact that Firefly has successfully developed one set of engines, and a rocket to carry them, argues in favor of the company's ability to develop even bigger, better engines and rockets for Northrop in the future.

What it means for Northrop Grumman

So basically, last week's launch was a step in the right direction for both Firefly and Northrop. For Firefly, the test flight advances the company toward commercial viability and keeps it on track to launch a planned six commercial missions in 2023 -- and to double that launch rate to 12 in 2024. It also positions Firefly to follow its space rivals into the IPO market, potentially via a SPAC transaction, should its majority shareholder, private equity firm AE Industrial Partners, so desire.

For Northrop -- which perhaps not coincidentally received its first upgrade on Wall Street in more than two months this week -- Firefly's success validates the defense giant's decision to bet on a start-up. Going forward, Northrop Grumman investors will want to keep a close eye on Firefly's success as it evolves from "Reaver" to the "Miranda" engines that Northrop needs for its new rocket ships.

Any setbacks for Firefly will imperil revenue streams at Northrop's space division -- which, remember, amount to 30% of Northrop's business. But the more progress Firefly makes, the more secure Northrop's space business will become.

Australia challenges China in mining for essential elements

7
Phil Mercer - BBC News, Sydney
Mon, October 17, 2022 

The Arafura Nolan's project will be built in central Australia, north of Alice Springs

In the blood red dust of central Australia, mining firm Arafura is planning to build a mine and processing facility for highly sought-after elements.

Located 80 miles north of Alice Springs, the Nolans Project will be in one of the hottest and driest parts of the country.

Despite the extreme conditions, Arafura believes the investment will be worth it. The planned mine and processing facility could satisfy up to 5% of global demand for neodymium and praseodymium (NdPr), which are used in high-power magnets.

They are two of a group of so-called rare earth elements, that are essential to the electronics industry.


NdPr, europium, terbium and other rare earth metals that were once barely heard of are now commonplace in the manufacture of phone touchscreens, wind turbines and other modern technologies.

The mining of these minerals is an industry currently dominated by China, but geopolitical and trade forces are at work that could reshape the international market.

China dominates the production of rare earth metals

Australia, a superpower exporter of iron ore and coal with rich mining traditions believes it is well-placed to join the race to exploit minerals that provide critical parts for electric vehicles and wind turbines.

"This could certainly be a game-changer for Australia. We are relatively well-endowed in rare earth elements," says Gavin Lockyer, managing director of Arafura Resources.

"This could really put Australia front and centre in the renewable sector.

"It is relatively easy to discover a rare earths deposit. What is difficult is finding a deposit that has economic quantities of the valuable materials."

Rare earths are a collection of more than a dozen elements on the periodic table. They are not particularly rare, but actually fairly plentiful in the Earth's crust.

Geoscience Australia, a government research agency, says they have broad industrial, medical, domestic and strategic applications "because of their unique catalytic, nuclear, electrical, magnetic and luminescent properties".

They are used in "magnets and super magnets, motors, metal alloys, electronic and computing equipment, batteries, catalytic converters, petroleum refining, medical imaging and lasers".

Europium is found in fluorescent lighting, gadolinium in nuclear power rods and ytterbium in solar panels.

Rare earth metals have become essential in the production of electronics

Mr Lockyer points out that some of the latest technology relies on their properties.

"It is important to note that an electric vehicle might only have AUD$200 (£120; $140) or so of NdPr in it, but without it that electric vehicle will not work efficiently. Similarly with the wind turbines," he adds.

In a time of war and menace, the valuable metals have strategic value and are used in fighter jets, guided missiles and drones along with other high-tech equipment for space exploration.

Australian firm Lynas Rare Earths has been contracted by the United States Department of Defense to build a multimillion-dollar processing facility in the US in a bid to reduce its reliance on China for strategic minerals.

Lynas is the world's only significant rare earths producer outside China and runs the Mount Weld mine in Western Australia.

"We look forward to not only meeting the rare earth needs of the US government, but also reinvigorating the local rare earths market," Lynas managing director Amanda Lacaze told the Australian Broadcasting Corp.

US Secretary of Energy Jennifer Granholm warned of China "big-footing" technology for renewable energy

The US Energy Secretary Jennifer Granholm warned recently at a conference in Sydney that China was "big-footing" renewable energy technology and supply chains.

Beijing's control of the supply of rare earths has been documented by the Australian Strategic Policy Institute (Aspi), an independent think tank based in Canberra.

It noted how the minerals have become weapons of diplomacy following a 2010 collision between a Chinese fisherman and Japanese patrol boats near a disputed chain of islands. Beijing complained about the "illegal interception" of its trawlers and retaliated.

"We saw the Chinese government stop rare earth supply to Japan as part of its economic coercion against the Japanese government," says Aspi analyst Albert Zhang.

"Since then, what countries have noticed is that there is a risk by having only one major supplier of rare earths [and] such an essential raw material isn't beholden to just the political will of one government. Australia has the materials and the right sort of companies and capital investment to diversify the world's supply chain."

Australian experts have said that more recently China threatened to limit rare earth shipments to American defence contractors because of US arms sales to Taiwan.

Rare earth metals are used in the powerful magnets inside wind turbines

John Coyne, who is in charge of Aspi's Northern Australia Strategic Policy Centre, also warns that China will not easily surrender its vice-like dominance of the international rare earths sector. He alleges that Beijing uses its "power and market-distortion tactics to strategically flood the market when it wants to drive out competitors and deter new market entrants".

"Australia has the world's sixth-largest reserves of rare earth minerals. However, they remain largely untapped with only two mines producing them," he says.

"There is significant potential in the establishment of multi-ore mineral-processing hubs in Australia. After all, there is no point in creating supply chain resilience for [rare earth] ores if miners must still send them to China for processing."

China's Global Times said Beijing would welcome "benign competition" to "improve production capacity" in the industry.

The newspaper added that "the US and some of its allies, in their pernicious and selfish attempt to contain China's rise, has brought toxic geopolitics to the crucial rare earth industry as well as other economic and trade fields".

Earlier this year, the South Korean carmaker Hyundai signed a memorandum of understanding with Arafura Resources, which provides "them security of supply [of rare earths] in a geopolitically stable environment".

A similar agreement to supply NdPr was reached between Arafura and GE Renewable Energy in July.

"What we have all seen during the pandemic is the importance of having multiple supply chains," says GE's Sam Maresh. "Ultimately, it is in everyone's interest to have diverse supply chains.

"We require rare earths to make very, very strong magnets that are used in our offshore wind turbines. NdPr allows you to make magnets that are super-strong [that] allow for the rotation and for the turbine to generate electricity using the wind," he told the BBC.

"We know that the energy transition requires a lot of rare earths. We use about 600kg of super-magnets for every offshore wind turbine. So we need a lot of this product. We can't decarbonise without rare earths."

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Senator blocks $75 million in U.S. military aid to Egypt over rights concerns

Sun, October 16, 2022 
By Humeyra Pamuk

WASHINGTON (Reuters) - Egypt has missed out on an additional $75 million in American military aid after a senior Democratic U.S. senator blocked the funding over concerns about Cairo's human rights record including holding political prisoners.

Senator Patrick Leahy, chairman of the Senate Appropriations Committee, rejected an assessment offered by the U.S. State Department to justify the aid, which was subject to conditions under a law passed by Congress last year. The committee has jurisdiction over spending legislation including U.S. financial assistance for Egypt.

"We should take this law very seriously, because the situation facing political prisoners in Egypt is deplorable," Leahy told Reuters in a statement.


"We can't give short shrift to the law because of other policy considerations. We all have a responsibility to uphold the law and to defend the due process rights of the accused, whether here or in Egypt," Leahy said.

The conditions set by Congress require Egypt to make "clear and consistent progress" in releasing political prisoners and providing detainees with due process of law.

The United States allocates around $1.3 billion in military aid to Egypt annually. Much of it has no conditions attached. But the State Department withheld $130 million of military aid to Egypt in September over broad rights concerns, but said it would allow another $75 million to be paid, citing progress by the Egyptian government on political detentions and due process, including the release of about 500 political detainees this year.

But Leahy objected. Talks between his office and the State Department failed to resolve the issue, and the $75 million in funding expired on Sept. 30.

The State Department did not immediately respond to a request for comment.

Leading human rights groups including Amnesty International and Human Rights Watch have accused Egyptian President Abdel Fattah Al-Sisi's government of widespread abuses such as torture and the detention of tens of thousands of political prisoners.

Sisi has denied that Egypt holds political prisoners. He also has said that stability and security are paramount for Egypt and that authorities are promoting rights by trying to provide basic needs such as jobs and housing.

Analysts have said Western powers are reluctant to take serious action against a strategic ally, in Egypt, that has served as a mediator in longstanding issues such as the Arab-Israeli conflict and also controls the Suez Canal, one of the world's most important shipping lanes.

U.S. officials have called the American relationship with Egypt complex. The most populous Arab country is a vital ally and Washington is still committed to support it for what U.S. officials call "legitimate defense needs."

(Additional reporting by Aidan Lewis in Cairo, Reporting by Humeyra Pamuk; Editing by Will Dunham and Michelle Nichols)