I know, everyone is focused on the election and debates and rising coronavirus cases. It can be easy to forget about the other stories out there. That’s why I write this roundup. It’s a nice glimpse into non-politics/non-pandemic stories.
The Business Buzz
Google goes under the gun. The DOJ — along with 11 states — formally filed an antitrust suit against Google this week. The suit specifically targets Google’s dominance over the internet search market (don’t worry, a suit against its digital advertising practices is likely in the works). The DOJ alleges that Google used anticompetitive practices to gain its 90% market dominance — actions that include paying companies like Apple and Verizon to have Google as the default search engine on their phones. The suit seems to signal a major shift in the relationship between big tech and the federal government — the most recent comparable antitrust lawsuit was more than 20 years ago against Microsoft.
Google wasted no time in responding to the lawsuit. Naturally, it denied having a monopoly due to unsavory practices. Instead, it effectively stated that consumers choose Google simply because it’s the best search engine out there. The tech giant also implied that the case could hurt consumers if the DOJ is successful — it could cause a rise in phone prices and the proliferation of second-rate search engines, Google claimed.
So will the case make a difference? The experts don’t seem to think so. While this suit could herald a new skepticism for big tech in the government, actionable change is less likely. Antitrust specialists say that if the DOJ wins, “any changes to the role played by Alphabet Inc’s Google in people’s lives are likely to be incremental – and years away.” The more important case to watch will be the one that targets Google’s digital marketing. The search engine is free — marketing is not. The presence of monetary transactions means that any proposed changes to Google’s marketing practices would be much more impactful to the market at large.
Millions in ill-gained profits, billions in fines. The Malaysian subsidiary of Goldman Sachs pled guilty in a US court this week in a massive corruption scandal. Here’s what went down, as reported by the New York Times:
“Goldman employees, the bank said, took part in a scheme to pay $1 billion in bribes to foreign officials. The bank, in turn, arranged the sale of bonds to raise $6.5 billion that was intended to benefit the people of Malaysia but was instead looted by the country’s leaders and their associates.”
Goldman Sachs made about $600 million over the course of the scandal. But that just-over-half-a-mil will cost the bank more than $5 billion in fines and penalties. The bank plans to “claw back” money paid to the former executive team and three specific bankers who were involved in the scandal as a way to help pay that hefty punishment. And it will also reduce 2020 bonuses for current c-suite members.
Nearly half that $5 billion is a single fine for violating the Foreign Corrupt Practices Act — it’s the largest penalty ever levied for such a crime. All that said, Goldman knew that large penalties were on the way since the case has been going on for a few years. The bank set aside billions of dollars since 2019 as an internal legal-fines fund. And many investors view the final verdict in the Malaysian corruption case as a boon to the bank. Without the case hanging over its head, Goldman Sachs can get back to business as usual. Its shares rose 1.4% the day the news dropped.
The Private Market
Game on. Back in April, startup crowdfunding platform Republic acquired Fig — a video game crowdfunding platform. This week Fig filed paperwork for a Reg A+ raise that would be the first of its kind. Fig is partnering with the makers of the Amico video game console (which has already accrued more than $7 million in investments) to offer a unique investment opportunity. The offering will be called “Fig Gaming Shares – Amico,” or FGS – Amico. Investors who participate will receive dividends from the sale of the Amico console and all games purchased for the console. Fig has promised to pay out at least 85% of its revenue shares to FGS – Amico holders. While Fig has offered Fig Gaming Shares in specific games previously, this will be the first time the platform has partnered with a console. The Reg A+ raise is not live yet, but it will certainly be an interesting opportunity when it is.
Even PayPal is getting into crypto now. US-based PayPal users can now buy and sell cryptocurrencies through their pre-existing account. Well, once they join the waitlist — but the full functionality is expected to be live for all users next month. And in 2021, users will also be able to fund normal PayPal purchases with their crypto balance — without having to go through a separate exchange. To achieve all of this, PayPal is partnering with Paxos, a fintech company that acts as a crypto brokerage. Starting out PayPal will support Bitcoin, Ethereum, Litecoin, and Bitcoin Cash — though it may add other coins/token over time.
While some people in the crypto world lauded PayPal’s move as part of the continuing legitimization of crypto at large, others criticized how the company is getting involved. High fees on fiat-to-crypto (and vice versa) exchanges and limiting user control over their crypto balances were a couple of areas where PayPal came under light fire. Regardless, given PayPal’s massive user base this move may help millions of Americans start to get involved in crypto for the first time.
The Fun Stuff
What is the perfect Halloween treat? Is it hard candy? Something with peanuts? What about fruit flavors or nougat? Well, wonder no more — the esteemed mathematical minds over at FiveThirtyEight conducted an in-depth statistical analysis to figure out what the best Halloween candy is. The verdict? A Franken-candy with chocolate, peanut butter, nougat, caramel, and wafer. Think Hershey’s meets Reese’s meets Babe Ruth meets Milky Way meets Twix.
If you’re looking for a different kind of treat to make at home this Halloween, consider baking some soul cakes. These were traditional baked goods that were used from the 8th century forward as an offering that could save a departed relative’s soul in the afterlife (though their origin is even older). There are a lot of different recipes for them out there, but in general they seem to be small, shortbread-like cakes that feature some kind of dried fruit — like raisins or currants — and often have crosses scored on their tops.
About: Aryelle Young
Aryelle Young is a published writer and editor with experience across industries. She has worked with an independent publishing company and as a proposal writer for a government contractor. Her original work has also been published in various journals and one short story collection. At KingsCrowd, she strives to provide insightful and actionable content for all readers. Aryelle graduated with a Creative Writing degree from George Mason University.