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US Midterm Elections, Ford Goes Local et al.

Professor of Financial Economics and Part-time Value Investor, Transfin.
Nov 6, 2018 1:45 PM 3 min read
Editorial

Good evening reader,

 

In continuity of our fascination with the world outside India, especially in light of Festive hibernation back home, today we talk of another event with a certain geopolitical weightage.

 

The US Midterm Elections, Polls opening sometime now!

 

First things first, what are the US Midterm?

 

Well, unlike in India or the UK, where the executive and legislature are tied together through Members of Parliament (MPs), the separation of powers in the US is much clearer i.e. the President and his / [fingers crossed] her administration are not Members of the House (Upper or Lower), unlike our Honourable Ministers, who are also MPs.

 

The election for the House takes place separately through the Midterms.

 

Why are the US Midterms so important?

 

President Trump currently presides over a Republican-led Lower ("US House of Representatives") and Upper House ("US Senate"). The House(s), which in the American context are supposed to be relatively bipartisan, have not really been delivering on their promise of Presidential accountability. Democrats hence hope the Midterms would skew the scales back in their favour, thereby placing a check on the President for the rest of his term.

 

Since we're all up for (some) checks and balances, and we say embracing the American spirit: Godspeed!

 

Moving on now to today's Top 6 Business Stories through our End Of Day Wrap Up:

 

INDIA

 

ICICI Bank defends ex-MD and CEO Chanda Kochhar in conflict of interest case, denies disclosure-related violations.

According to a Business Standard article, in a personal hearing called by the Securities and Exchange Board of India (SEBI), the bank told the regulator that its code of conduct policy did not mandate disclosure of investments or transactions concerning firms that are owned by a bank employee's spouse.

 

The ongoing proceedings against Chanda Kocchar is regarding the alleged violation of disclosure norms by Videocon Group and NuPower Renewables, a firm owned by Deepak Kochhar, Chanda Kochhar’s husband.

 

Ola launches in New Zealand, will offer services in Auckland, Wellington and Christchurch.

After commencing operations in Australia and UK earlier this year, Ola announces entry into New Zealand. The Bangalore-based cab aggregator is set to offer its services in Auckland, Wellington and Christchurch.

 

Govt earmarks loans worth c. INR9,000cr for MSMEs as part of its outreach and support programme.

The Prime Minister had on Friday announced a 12-point package for Micro, Small and Medium Enterprises (MSMEs) as a part of a 100-day outreach and support programme, which aims to provide MSMEs with increased access to credit and cash flows, along with a liberal business environment.

 

The MSME sector contributes about 45% to manufacturing, 40% to exports and roughly 8% to the GDP.

 

Ford goes local, aims to carve its niche in India’s automobile market.

According to a report by Reuters, Ford Motor made a profit in India for the first time in a decade last fiscal year, on back of the Emerging Market Operating Model (EMOM) initiative.

 

As part of initiative, Ford is deepening ties with Mahindra to build passenger vehicles in India, which could also involve sales in other emerging markets.

 

Moving away from its "One Ford" plan, the automaker is now developing more vehicles locally, thereby cutting its manufacturing costs by 40%.

 

US/INTERNATIONAL

 

Facebook disables 115 accounts ahead of US midterm elections.

The social media giant removed 30 accounts on Facebook and 85 on Instagram following a US law enforcement notification regarding suspected “coordinated inauthentic behaviour”.

 

Facebook has lately come under the scanner following repeated news of accounts being hacked and Russian hackers meddling in the 2016 elections.

 

Verizon may see major restructuring under the new CEO.

According to a CNBC report, the American telecommunications co will be reorganized into three units - Verizon Media Group/Oath, Consumer and Business to focus on the types of customers it serves.

 

To be effective from Jan 1st, 2019, Verizon Media Group will manage Oath, which includes media properties like Yahoo and HuffPost, Verizon Consumer will manage wireless and wired customers, and Verizon Business will manage products for companies and governments.

 

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