FT News Briefing Thursday, August 15
Aug 15, 2019
US equities took a sharp dive, spurred by fears of a slowing global economy. WeWork is gearing up for a significant IPO despite facing financial challenges. Political intrigue deepens in the UK with proposals to delay Brexit as Jeremy Corbyn put forth a temporary government plan. In Canada, Justin Trudeau is under scrutiny for violating conflict-of-interest laws. Meanwhile, PayPal is tapping into the booming mobile user market in India, responding to rising demand.
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Market Fears Recession
- U.S. stocks fell nearly 3% due to fears of a global recession triggered by weak economic data from China and Germany.
- The yield curve inverted briefly, signaling a potential recession as investors favored short-term bonds over long-term ones.
WeWork's Losses Mount
- WeWork's IPO prospectus reveals mounting losses exceeding $900 million in the first half of 2019, despite revenue growth.
- The company's aggressive expansion plans, including tripling its workstations, raise concerns about profitability.
WeWork's Unusual Structure
- WeWork's unusual up-C structure and multi-class shares give Adam Neumann significant control.
- Public investors will buy Class A shares with one vote each, while Neumann's Class B shares have 20 votes each.