The Epoch Times : Chinese Military May Have Had COVID-19 Virus in Its Possession

Chinese Military May Have Had COVID-19 Virus in Its Possession as Early as September 2019
People’s Liberation Army scientists applied for COVID vaccine patent in February 2020

According to the World Health Organization, there have been 6,947,192 confirmed COVID-19 deaths globally as of June 28.

Of those, 1,127,152 occurred in the United States, making the number of Americans killed by the virus more than 19 times the number of American soldiers killed in the Vietnam War.

And yet, over three years since the beginning of the pandemic, we still don’t know where the virus originated. The fear is that the next time around, the number of deaths could be much higher; because we didn’t learn from this pandemic, we wouldn’t be as prepared as we should for the next one.

This fear is shared by all Americans. That is probably why in March, the U.S. Congress unanimously passed the “COVID-19 Origin Act of 2023,” requesting that the Office of the Director of National Intelligence (ODNI) “declassify all information relating to potential links between the Wuhan Institute of Virology and the origin of COVID-19.” “The ODNI must submit to Congress an unclassified report with all such information with redactions only as necessary to protect sources and methods,” the new law says.

On June 23, ODNI released a 10-page report titled “Potential Links Between the Wuhan Institute of Virology and the Origin of the COVID-19 Pandemic.”

As someone who has been following this development closely, ODNI’s report told me nothing beyond what I already knew, except for one little gem on page 5: that the Wuhan Institute of Virology (WIV) had developed a technique that “left no traces of genetic modification of SARS-like coronaviruses.”

“Some of the WIV’s genetic engineering projects on coronaviruses involved techniques that could make it difficult to detect intentional changes,” the report stated.

Why did the WIV want to develop such a technique? Scientists at the institute had been publishing their research on viruses in the best scientific journals, including on “genetic modification of SARS-like coronaviruses,” so it didn’t look like they wanted to hide what they had been doing. Maybe what they published was only part of their research, and they wanted to conceal the research they didn’t publish? What would that be?

Before the ODNI report, U.S. investigative journalists revealed in early June that three WIV researchers, Ben Hu, Ping Yu, and Yan Zhu, were allegedly the first COVID-19 patients, having fallen ill in the fall of 2019.
They were reportedly conducting research on SARS-like viruses and engaging in “gain-of-function” experiments.
Gain-of-function, which involves altering the properties of a pathogen in order to study its potential impact on human health, increases the infectiousness of viruses and/or makes them more lethal.

The WIV denied such allegations. “The recent news about so-called ‘patient zero’ in WIV are absolutely rumors and ridiculous,” Ben Hu told the journal Science in June.

I was hoping that the ODNI report would shed more light on the origin of SARS-CoV-2.
It didn’t, but a patent application I found through a web search strongly suggests that the Liberation Army (PLA) had the genetic sequence of the virus in its possession as early as September 2019. This would fit well with the allegation that the three WIV scientists were infected by the virus in the fall of 2019.

It’s worth noting that the same allegation was made by the Department of Justice in a fact sheet published Jan. 15, 2021, which said the U.S. government had “reason to believe that several researchers inside the WIV became sick in autumn 2019, before the first identified case of the outbreak.”

Officially, World Learned of Virus in January 2020

The first cases of the atypical pneumonia (later known as COVID-19) were reported in Wuhan in December 2019.
The news was soon supressed by the Chinese Communist Party, as China was preparing to celebrate the Lunar New Year—a time that no bad news is allowed. Whistleblowers like Dr. Wenliang Li were punished. Officially, Chinese virologists did not have a chance to study the novel virus until early January 2020.

On Jan. 11, 2020, Professor Yong-Zhen Zhang’s group from Fudan University in Shanghai submitted the genome sequence of SARS-CoV-2 to GenBank (accession number MN908947.1) in Maryland.
Prof. Zhang obtained the virus by collecting bronchoalveolar lavage fluid from a 41-year old male patient in Wuhan, who had been admitted to hospital on Dec. 26, 2019. Chinese state media reported his death on Jan. 11, 2020.

Jan. 11, 2020, was the day that SARS-CoV-2 officially became known to the world.
WHO announced that it had received the genetic sequence of the novel coronavirus from the Chinese regime and would soon make it public.
PLA’s Warp Speed Vaccine Research
On Feb. 24, 2020, Dr. Yusen Zhou and 10 other inventors from the PLA’s Institute of Microbiology and Epidemiology in Beijing filed a patent application (number 202010112679.9) titled “Novel coronavirus titled “COVID-19 vaccine, preparation methods and applications.”
The application described in detail the design of the vaccine, the method to produce the vaccine, and the immunogenicity of the vaccine.

I am a vaccine scientist who worked for one of the world’s largest vaccine companies for more than 10 years, and I spearheaded SARS-CoV-1 vaccine development in 2003. I was stunned by the speed these PLA inventors were able to not only study the new virus and develop and test a vaccine so quickly, but also put together a patent application in merely 44 days (from Jan. 11 to Feb. 24)!

Vaccine development is an arduous process, usually taking about 10-15 years on average to accomplish.
Before COVID-19, the fastest a vaccine that had ever been developed was the mumps vaccine in 1967, which took four years.

Of course, the U.S. government’s “Operation Warp Speed” made it possible for vaccine companies to accelerate their processes, which we now know compromised safety and effectiveness.

Moderna published their Phase I/II clinical data on July 14, 2020, and Pfizer published theirs on Aug. 12, 2020.
Then in December of that year, the U.S. Food and Drug Administration granted the Moderna and Pfizer vaccines Emergency Use Authorization.

When I worked in the vaccine industry, I was the liaison between R&D (Research and Development) scientists (which I was also a member of) and our in-house lawyers in the IP (Intellectual Property) office. I was personally involved in the filing of dozens of patent applications. Normally, patent applications should be filed as soon as scientists discover something new, useful, and non-obvious—the three properties patent lawyers stress that scientists keep an eye out for and document.

A patent application can be filed before a vaccine is tested and granted for distribution. One could argue that the PLA’s application was “provisional,” meaning it would serve as a placeholder so that experimental results could be added later when available, hence it is possible that it only took 44 days to draft their patent application.

Yes, when things move extremely smoothly, a patent application could be put together in about one and a half months. However, the PLA’s filing contains real experimental data that would take time and effort to perform and collect. This makes it extremely unlikely that the scientists only received access to the virus information on or after Jan. 11, 2020.

Telling Timeline
If the PLA did have access to the virus, maybe they got the information from Prof. Zhang before he submitted the genetic sequence to GenBank, or maybe they got it elsewhere. Or it could be that since the scientists are with the PLA, how they obtained the virus constitutes a military secret.

The scientists’ application described that the vaccine composition is an RBD-Fc recombinant protein. It was used to immunize mice to generate (antibody-containing) serum samples.
These serum samples were collected 7 and 12 days after immunization, respectively.
These details were given on all phases of their vaccine development.

Drawing from my 10-year experience with vaccine development and patent filing, in my estimation the following amounts of time would be needed to carry out what the PLA scientists described in their patent application:

  • Design of the vaccine: 1 month
  • Develop a method to produce the vaccine: 2 months
  • Test immunogenicity of the vaccine: 2 months
  • Prepare patent application: 1.5 months

The likely time that the PLA scientists first got their hands on the virus and its genome sequence would be around September 2019—six and a half months before they filed their patent application on Feb. 24, 2020.

Mysterious Death of PLA Scientist
Dr. Zhou, the lead author of the PLA patent application, died at age 54 under mysterious circumstances in May 2020, three months after he filed the application. Zhou was one of the most well-known virologists in China, who had worked closely with the WIV as well as with U.S. scientists, yet there were no tributes to mark his passing. The news was only casually mentioned in an article published in July 2020. It was obvious that the authorities did not want to publicize his death.

To the Chinese authorities, everything related to COVID-19 is a state secret.
But COVID-19 is not only a China issue, it is a global issue.
More knowledge and information about what happened could literally save millions of lives.

Here’s what we know to be fact:

Fudan University’s Prof. Zhang published the SARS-CoV-2 genome sequence on Jan. 11, 2020;

PLA’s Dr. Zhou and his team filed a patent application for a COVID-19 vaccine on Feb. 24, 2020;

Dr. Zhou passed away in May 2020;
On June 23, 2023, ODNI published a report stating that the WIV had developed a technique that leaves “no traces of genetic modification of SARS-like coronaviruses.”

Is it possible that from early 2019, the PLA’s scientists were working with WIV scientists to develop coronaviruses that could infect humans, while simultaneously developing vaccines against such viruses? If that’s the case, it would explain why Dr. Zhou was able to file the patent application in February 2020. And because Dr. Zhou’s application revealed too much information, the CCP was unhappy with him and he had to be gotten rid of.

Given how the CCP operates, and its obfuscation, coverups, and lack of cooperation with other countries that has gone on around discovering the origin of the virus outbreak, I think it’s a plausible scenario.

WSJ : Microsoft’s Court Win Puts U.K. Regulator in Challenging Spot Over Activis

Microsoft’s Court Win Puts U.K. Regulator in Challenging Spot Over Activision Deal
Britain’s antitrust watchdog is the only major regulator preventing the deal from closing, says it is ready to consider a new proposal

LONDON—The U.K.’s competition regulator said Wednesday that it would need to conduct a fresh investigation into any changes made to Microsoft’s $75 billion Activision acquisition aimed at winning approval for the deal.

Britain’s Competition and Markets Authority didn’t say how long such an investigation would take, but any probe could make it difficult for Microsoft MSFT 1.42%increase; green up pointing triangle to complete its acquisition of Activision ATVI -1.09%decrease; red down pointing triangle ahead of the companies’ self-imposed July 18 deadline.

The statement from the CMA points to the delicate spot the agency has found itself in after a U.S. federal judge cleared a path for the merger Tuesday. The U.K. authority, which rejected the acquisition in April, is now the only major regulator currently standing in its way.

The CMA has grown in importance as a global tech regulator since the U.K.’s exit from the European Union. After previously deferring to Brussels on big international deals, the agency is now a potential regulatory risk that companies and antitrust lawyers have to take into account along with authorities in the U.S. and EU.

Its stance on the Microsoft-Activision deal “comes at a challenging political juncture,” said Stavroula Vryna, a London-based antitrust partner with law firm Clifford Chance. She said the U.K. government is eager to present itself as open for business and a potential hub for global tech, and the CMA’s decision has drawn criticism about the impact on tech investments in the country.

The CMA this week said it had asked an appeals tribunal that had been set to hear the case to pause proceedings so it could consider new proposals from the companies to address its concerns.

“Microsoft and Activision have indicated that they are considering how the transaction might be modified, and the CMA is prepared to engage with them on this basis,” the regulator said Wednesday.

Neither side disclosed details of a proposal or a potential timeline. The CMA said discussions with the companies are at an early stage.

Merger experts said it is procedurally possible for the CMA to fast-track an investigation, which could significantly shorten the time frame for dealing with a new proposal.

Antitrust lawyers said the CMA’s apparent willingness to consider new proposals was unexpected.

“It is really an unprecedented and dramatic turn of events,” said Alex Haffner, a partner at U.K. law firm Fladgate. He said the CMA appears to be saying that it is open to a compromise, which might allow the agency to avoid the pending appeal.

The CMA declined to comment on the situation beyond its statement.

The EU approved the deal in May after accepting Microsoft’s behavior-based commitments, while antitrust watchdogs in Japan, China and other markets have also cleared the acquisition.

The Federal Trade Commission had sought to halt the deal but lost its bid for an injunction Tuesday when a judge said the agency hadn’t shown Microsoft’s ownership of Activision games would hurt competition in the console or cloud-gaming markets.

The FTC late Wednesday filed a notice to appeal the judge’s decision.
The agency also has a separate process to challenge the deal scheduled to start in August.

The CMA’s more prominent role in merger approvals comes with greater scrutiny than the agency has faced in the past. The CMA operates independently from the government and has shown an interest in pushing back against the dominance of large tech companies. But doing so raises the risk of being perceived as antibusiness, especially when its stance differs from those of other major regulators.

Microsoft Vice Chair Brad Smith publicly criticized the CMA earlier this year, saying its decision to block the Activision deal would discourage technology innovation and investment in the U.K. Smith later met with U.K. Chancellor of the Exchequer Jeremy Hunt and with the CMA to discuss the agency’s ruling.

Separately, the CMA was chided by the Competition Appeal Tribunal recently after it asked for Microsoft’s appeal hearing to be delayed. The CMA said its preferred lawyers weren’t available and suggested it would be at a disadvantage in going head-to-head with the tech company’s legal firepower.

“We consider that the CMA has not paid sufficient heed to the true public interest in this case,” the tribunal said in dismissing the CMA’s request for a later hearing. It said many of the CMA’s problems “appear to be self-induced.”

Florian Mueller, an independent analyst based in Munich who has worked with Microsoft in the past, said the CMA appears to be taking a less aggressive stance after its initial decision to block the Microsoft-Activision deal.

“They may have realized that it’s neither a good idea nor feasible to turn the U.K. into a merger graveyard,” Mueller said.

Still, there is precedent for the CMA blocking a global deal.

Last year, the CMA reaffirmed an order forcing Facebook owner Meta Platforms to unwind its 2020 acquisition of social-media animated-images company Giphy, after the appeals tribunal found the agency had made a procedural mistake.

The CMA took that ruling into consideration and issued a revised decision that again ordered Meta to sell Giphy.

Antitrust lawyers, though, say the Giphy deal was smaller and didn’t attract the same attention that the Microsoft-Activision decision has garnered.

Finding a resolution might not be easy. Vryna, the Clifford Chance lawyer, said it is difficult to see how Microsoft and Activision could offer a divestment that would be credible from the CMA’s perspective and commercially palatable to the companies.

Meanwhile, if the companies opt to extend the July 18 deadline, Activision could seek to renegotiate the financial terms.

Microsoft announced its plans to buy Activision in January 2022 and valued the deal at $69 billion after adjusting for the videogame publisher’s net cash.

FT : US junk bond market shrinks as rising rates put off borrowers

US junk bond market shrinks as rising rates put off borrowers
High-yield market contracts 13% from 2021 peak amid fears of false signals about American economy’s health

The $1.35tn US junk bond market has shrunk by almost $200bn since its all-time peak in late 2021, helping to anchor prices at levels that investors say could give false signals about the health of the world’s largest economy.

A steep rise in interest rates since early last year has helped deter companies from selling new bonds, while several companies have climbed out of the high-yield market into investment grade territory.
Meanwhile, more borrowers are turning to private markets for fresh funds. Altogether, this has wiped 13 per cent off the total value of US junk bonds in issue since the record high.

That shrinkage has left investors with less choice about what they can buy and has pushed some fund managers to purchase bonds they might not otherwise have picked. That is helping prop up junk bond prices, even though many market participants continue to anticipate some form of economic slowdown.

“Dramatically lower issuance” is “really underpinning the asset class in terms of valuations”, said Andrzej Skiba, head of BlueBay US fixed income at RBC Global Asset Management.

“We’ve got cash building every month . . . You end up just buying the same stuff over and over,” added Dan DeYoung, high-yield portfolio manager at $584bn investment firm Columbia Threadneedle. 

Those dynamics are threatening to give overly positive signals about the health of the economy, some investors believe. They are also potentially lining up the bond market for a sharper decline if the outlook darkens — particularly those of lowly rated companies that failed to extend the maturity of their debt when money was cheap.

“It’s asymmetric,” said Marty Fridson, a veteran high-yield investor and chief investment officer at Lehmann, Livian, Fridson Advisors. “These conditions can cause the market to be overvalued, but they don’t protect you from a huge sell-off and a gapping down in prices when things turn around.”

While a lack of supply has helped keep spreads low, “as we move into year-end, there are concerns that as recessionary headwinds start hitting the markets, we will see volatility pick up and spreads widen,” said Anders Persson, fixed income chief investment officer at Nuveen.

For decades, the high-yield bond market was the mainstay of risky borrowers, growing in size at an annualised pace of 8.7 per cent between 1996 and 2020, according to an analysis by Fridson. It later expanded to a record $1.55tn in 2021, as ultra-low interest rates sparked a dealmaking frenzy.

But issuance slumped in 2022, and while the amount of money raised has since climbed 30 per cent year on year to $90bn in the first half of 2023, this largely reflects refinancings. New borrowings in the first half of this year numbered just 39, totalling $33.2bn. That marks the lowest year-to-date deal count as of June 30 since 1995, Dealogic data shows, and the lowest by dollar amount since 2009.

“We are trading at probably tighter spreads than otherwise would be the case if we had a more vibrant primary market,” said Skiba.


Junk bond yields have shot to 8.69 per cent as of July 11 from a low of 4.53 per cent in the wake of the Covid-19 crisis. While most of that increase is accounted for by Fed rate rises, the spread — the extra yield demanded by investors to hold risky bonds over US Treasuries — has simultaneously widened out to 4.05 percentage points from roughly 3 percentage points.

Still, that level was narrower than at the start of 2023 and than the historical average of 4.58 percentage points for high-yield bonds outside of recessionary periods, said Fridson.

Investors note that economic indicators, including jobs market data, have so far been more buoyant than many had feared, despite the Fed’s aggressive tightening campaign, although figures on Friday showed that jobs growth slowed more than expected in June.

“That slowdown will manifest itself sooner or later,” said Skiba, speaking ahead of Friday’s jobs data, noting “the Fed’s rates being deeply in restrictive territory, and also the double-whammy from US banks — particularly regional banks — curbing lending activity”.

“I view the high-yield asset class, especially double-Bs, [as] fairly vulnerable if we do move into a recession that’s not just a very minor and shallow and brief recession,” said Adam Abbas, co-head of fixed income at Harris Associates, referencing the highest-quality rung of junk credit.

Ratings upgrades have also compressed the high-yield market, supporting prices. More than $81bn of debt has reached investment-grade status already this year, according to a Goldman Sachs analysis of major rating agencies’ actions, compared with $116bn throughout 2022. Just $15.6bn of debt had dropped down to junk as of late June.


For Lotfi Karoui, Goldman’s chief credit strategist, supply shrinkage this year “is entirely driven by rising stars exceeding fallen angels”, although many recent upgrades reflect a “backlog essentially of rising star candidates that should have probably been upgraded in late 2020, mid-2021”.

Toymaker Mattel, streaming giant Netflix, energy company Occidental Petroleum and insurer Enact are among the US companies that Moody’s has upgraded to investment-grade status in 2023.

Rating agencies move independently, with S&P lifting Netflix to investment-grade in late 2021.

More upgrades could follow, analysts and investors suggested, highlighting companies that were downgraded in 2020 and have not yet moved back upwards, such as car giant Ford.

High-yield bonds are not the only shrinking asset class. The $1.4tn junk loan market has also contracted this year for only the second time since 2010, with private credit again blamed for being a magnet pulling borrowers away from public debt.

UBS estimates that the private credit market has reached $1.55tn, up from $1tn in 2019. While drivers vary, some noted the greater certainty of execution in non-public transactions and fewer lenders involved.

Karoui said it was more of a “natural substitution” for loan issuers to switch to private credit than for bond issuers to do so. Still, “there’s no question that the depth of financing that is offered by private debt markets has increased dramatically”.

FT : Meta to release commercial AI model in effort to catch rivals

Meta to release commercial AI model in effort to catch rivals
Microsoft-backed OpenAI and Google are surging ahead in Silicon Valley development race

Meta is poised to release a commercial version of its artificial intelligence model, allowing start-ups and businesses to build custom software on top of the technology.

The move will allow Meta to compete with Microsoft-backed OpenAI and Google, which are surging ahead in the race to develop generative AI. The software, which can create text, images and code, is powered by large language models (LLMs) that are trained on huge amounts of data and require vast computing power.

Meta released its own language model, known as LLaMA, to researchers and academics earlier this year, but the new version will be more widely available and customisable by companies, three people familiar with the plans said.
The release is expected imminently, one of the people said.

Meta says its LLMs are “open-source”, by which it means details of the new model will be released publicly. This contrasts with the approach of competitors such as OpenAI, whose latest model GPT-4 is a so-called black box in which the data and code used to build the model are not available to third parties.

“The competitive landscape of AI is going to completely change in the coming months, in the coming weeks maybe, when there will be open source platforms that are actually as good as the ones that are not,” vice-president and chief AI scientist at Meta, Yann LeCun, said at a conference in Aix-en-Provence last Saturday.

Meta’s impending release comes as a race among Silicon Valley tech groups to establish themselves as dominant AI participants is heating up.

Writing in the Financial Times this week, Meta’s global affairs chief Nick Clegg extolled the virtues of an open source approach, saying “openness is the best antidote to the fears surrounding AI”. But the move also helps Meta in its attempts to catch up with rivals, as an open model would allow companies of all sizes to improve the technology and build applications on it.

Meta has been working on AI research and development for more than a decade but has appeared to be on the back foot after OpenAI’s ChatGPT, a conversational chatbot, was released in November, spurring other Big Tech groups to launch similar products.

“The goal is to diminish the current dominance of OpenAI,” said one person with knowledge of high-level strategy at Meta.

Meta declined to comment.

While Meta’s technology is open source and currently free, two people familiar with the matter said the company had been exploring charging enterprise customers for the ability to fine-tune the model to their needs by using their own proprietary data. One person said there were no current plans to charge and Meta would not do so in the upcoming release.

Joelle Pineau, Meta’s vice-president of AI research, declined to comment on the development of a new AI model and how it might be monetised but said: “At the end of the day, because you release something [open source], you don’t completely give up on the intellectual property of that work.”

“We haven’t been shy about the fact that we do want to be using these models [in our] products,” she added.

In 2021, chief executive Mark Zuckerberg announced a pivot to build an avatar-filled digital world known as a metaverse and has spent more than $10bn a year on the project. That costly ambition has proven unpopular with investors and Meta has recently raced to increase its AI investment. 

Earlier this year, the social networking giant set up a generative AI unit led by chief product officer Chris Cox. Pineau said Cox’s team straddled the research side of AI but also product development, as it was “creating totally new businesses”.

Zuckerberg and other executives have hinted at a push towards creating multiple AI chatbots for individuals, advertisers and businesses across Meta platforms Instagram, WhatsApp and Facebook, powered by its LLMs.

The benefit of open source models includes a higher take-up by users who then input more data for the AI to process. The more data an LLM has, the more powerful its capabilities can become.

Furthermore, open source models allow researchers and developers to spot and address bugs, improving the technology and security simultaneously — at a time when technology companies such as Meta have faced years of scrutiny over various privacy and misinformation scandals. 

While providing software for free can seem antithetical to making money, experts believe corporations can also use this strategy to capture new markets. 

“Meta realised they were behind on the current AI hype cycle, and this gives them a way to open up the ecosystem and seem like they are doing the right thing, being charitable and giving back to the community,” said one person familiar with the company’s thinking.

Still, there are clear risks with open source AI, which can be shaped and abused by bad actors. Child safety groups report a rise in child sexual abuse imagery generated by AI online, for instance.

Researchers also found that a previous Meta AI model, BlenderBot 2, released in 2021, was spreading misinformation. Meta said it made the BlenderBot 3 more resistant to this content, although users still found it generated false information.

There are also regulatory and legal risks concerning intellectual property and copyright.
On Monday, comedian and actor Sarah Silverman filed a lawsuit against Meta and OpenAI over claims her work was used to train models without her consent.

Meta released its open source model LLaMA to researchers in February. A month later, it leaked more widely via the online forum 4chan, prompting developers to build on top of it in breach of Meta’s licensing rules, which specify it should not be used in commercial products.

“This model is out there in ways that we wish it wasn’t,” Pineau said.

Other AI companies, such as French start-up Mistral, are also examining the potential of releasing open source versions of their technology. OpenAI, which has released open source AI models for speech and image recognition previously, said its team was looking into developing an open source LLM, provided they were able to reduce the risks of misuse below a minimum threshold. 

“We have a choice between deciding that artificial intelligence is too dangerous a technology to remain open and putting it under lock and key and in the hands of a small number of companies that will control it,” Meta’s AI chief LeCun said. “Or, on the contrary, open source platforms that call for contributions . . . from all over the world.”

FT : As Chinese cars speed into global markets, tensions will only escalate

As Chinese cars speed into global markets, tensions will only escalate
Security dilemmas and the threat to Europe’s industrial base raise questions for governments


China’s emergence as the world’s largest auto exporter caught many people — including the biggest carmakers — by surprise.
Cars used to be a rare type of manufacture in which western companies retained durable technological advantages. The transition to electric vehicles has given Chinese companies an opportunity to leap ahead, threatening to reshape trade flows in the process.

The surge of Chinese cars into foreign markets poses two dilemmas that will complicate trade. The first relates to security. New cars feature dozens of sensors, complex software systems and semi-autonomous capabilities. Western leaders have only just begun to consider the security implications of fleets of foreign-made, sensor-stuffed cars on their roads. Beijing, by contrast, has imposed strict data localisation rules on Tesla — China is its biggest market outside the US — and banned Tesla’s cars from sensitive locations.

Italy’s recent decision to limit a Chinese shareholder’s influence in Pirelli, a leading tyremaker, signals a change. The Italian government may be partly motivated by protectionism but it also cited Pirelli’s advanced Cyber Tyre, which collects and transmits driving data, as a rationale for curbing China’s influence in the company. Now even tyremakers are tech companies, the auto industry is unprepared for an intensified focus on security concerns about Chinese cars.

The second challenge is to Europe’s industrial base. Legacy automakers, especially in the price-sensitive middle market, face tough competition. Chinese cars source components mostly from Asia, not from Europe; facing a surge of Chinese car imports, some European businesses are calling for help.
Chinese EVs are high quality, though their price competitiveness has benefited from a decade of protectionism and government support totalling tens of billions of dollars annually.
Western car companies are no strangers to bailouts or public ownership stakes, but the scale of support to China’s EV industry far exceeds other states’ generosity.

History suggests that governments will be loath to let their companies lose auto market share. Japan’s success in selling to US consumers in the 1970s and 1980s caused tariff threats and currency disputes, leading American auto workers to bash Japanese cars with baseball bats. Tension was defused only when Japanese companies opened factories in the US.

This time, the US is not bashing China’s cars but copying its methods, imposing major trade barriers such as the Trump-era 27.5 per cent tariff on imports of all Chinese vehicles. Now, Joe Biden’s Inflation Reduction Act provides generous subsidies for EVs that meet local content thresholds, excluding Chinese vehicles. In the face of these tariffs and subsidies, Chinese companies simply can’t compete in the US.

But the EU’s car market remains open to imports.
The continent’s EV subsidies have caused a surge of imports — partly because Chinese cars are cheaper and partly because European automakers were late in rolling out competitive EVs of their own.
European nations are beginning to debate the wisdom of this approach. German automakers oppose protectionism lest Beijing respond by limiting their access to the vast Chinese market. France, however, recently announced environmental rules that, in practice, will ensure EV subsidies only apply to cars made in Europe. Senior French politicians call for dumping investigations — and even tariffs.

News that Chinese EV makers now face overcapacity at home escalates these concerns. Nio, one of the country’s leading EV start-ups, cut prices by $4,200 per car in June, responding to slowing demand in China. From China’s playbook in sectors from steel to solar panels, domestic overcapacity may be addressed by ramping up cut-price exports.

If so, the implications for trade would be wide ranging. Trade in car parts and finished autos exceeds $1tn annually. Alongside electronics, autos are one of the most complex and internationalised supply chains.

Escalating auto trade tension would have an impact on another sector that has seen plenty of recent disputes: semiconductors. A typical EV has more than $1,000 of semiconductor content inside. The chips that manage EV power supply are mostly produced by western companies. If Chinese cars are locked out of foreign markets, will foreign chips be allowed in Chinese cars? Beijing would need only to point towards the IRA’s local content requirements as justification for further splintering trade in one of the world’s most globalised industries.

FT : Jean-Laurent Bonnafé, BNP’s longtime ‘introvert’ boss

Jean-Laurent Bonnafé, BNP’s longtime ‘introvert’ boss
Head of eurozone’s biggest bank faces challenges from energy transition to his own succession

Most chief executives might be tempted by the limelight if they had spent more than a decade running the eurozone’s biggest bank and outperformed regional rivals blighted by crises.

Not Jean-Laurent Bonnafé, who if anything has retreated farther from view in his 12 years in charge of BNP Paribas.

“I’m just the one who succeeded someone else,” the 61-year-old told the Financial Times in a rare interview in Paris. “The bank was incorporated in 1848 and is here to stay for a very long period of time. This is a team.”

But although he may prefer to hide from view, Bonnafé has a set of challenges that will eventually define his record at the French bank — not least that of assuring his own succession, even if BNP’s bylaws allow him to stay on until 2028.

During a tenure that has included the eurozone crisis and the coronavirus pandemic, BNP’s shares have held up better than most of its European peers but its price-to-book ratio of 0.54 lags behind those of some, including HSBC and Santander and particularly most big US lenders.

The bank has cemented its status as one of Europe’s top corporate financiers and is further bolstering its ambitions as the continent’s go-to investment bank, beating one-time potent rivals Deutsche Bank and Barclays by revenue, although Wall Street banks remain by far the market leaders.


As he looks to deliver on a promise of higher returns over the next two years, Bonnafé must now prepare BNP for a greener makeover — a source of growing scrutiny as climate campaigners who accuse it of not dropping fossil fuels fast enough bring lawsuits against the bank and plaster the elusive chief executive’s face on protest posters.

At the same time, BNP has a “steady-as-she-goes” reputation to uphold, with a streak of regular quarterly profits over the past decade marred only by the $9bn in penalties the bank faced for US sanctions-busting in 2014.

“In a sector in which it’s tough to sleep easy, BNP is seen as a higher-quality, safer organisation,” said Barclays analyst Amit Goel. 

Bonnafé is more positive than some peers about the threat posed to banks by the rapid reversal of ultra-low interest rates in Europe and the US, with the industry having ratcheted up its defences and regulatory buffers since the 2008 financial crisis.

That is despite growing warnings of a looming plunge in commercial real estate and company valuations, the collapse this year of Californian lender Silicon Valley Bank and the forced takeover of long-suffering Credit Suisse by its Swiss rival UBS.

“So far, yes, there were some isolated issues, but no major global problem,” Bonnafé said, adding: “I am a bit conflicted to say this is great, but if we try to look calmly at the situation maybe 15 years before, the system would be in a very different shape.”

In his time running BNP, calmness has been among Bonnafé’s trademarks.

“He’s always been very self-contained,” said Olivier Andriès, chief executive of jet engine maker Safran and a former classmate both at the Polytechnique engineering school and the elite Corps des mines, a training ground for French civil servants. “I’ve never known him to fly off the handle.”

BNP insiders and rival bankers credit Bonnafé for creating a tightly managed operation that has proved conservative on risks and costs, with some describing a highly hierarchical internal culture.

While French media have cited one of his nicknames as J’Lo, a riff on his shared initials with US pop star Jennifer Lopez, some employees raised less flattering monikers — including “the Supreme Soviet”.

Bonnafé’s reserve goes beyond his public persona, even if he is no stranger to establishment circles. Some French officials said he was a mystery to them, an anomaly for the head of a lender that was state-owned until the year he joined in 1993 — at the start of a wave of French privatisations — and remains a go-to bank for the French government.

BNP, which has remained France’s dominant primary dealer for government bonds, was instrumental in orchestrating emergency state-backed loan schemes funnelled via French banks during the pandemic.

Born to a family from the southern city of Albi, Bonnafé initially followed in his EDF engineer father’s footsteps in his studies.

At Polytechnique, a recruiting ground for blue-chip French companies, he rubbed shoulders with other future European bank bosses including Tidjane Thiam of Credit Suisse, Jean Pierre Mustier of UniCredit and Société Générale’s Frédéric Oudéa.

A lover of classical music, one of Bonnafé’s few public pursuits is as head of the Friends of the Paris Opera, where he entertains big clients.
Another yearly outing is the Roland-Garros tennis tournament.
However, people who know him professionally struggle to detail how he spends his downtime.

“He’s an introvert,” said one senior banker who has known him for years. “He’s not going to tell you what he did on the weekend, or only if you really force him.”

Corporate bosses are more forthcoming. Bonnafé’s first job at BNP was to manage big clients, after a stint at France’s ministry of industry and in private equity.

Arthur Sadoun, who once advised BNP on campaigns as a publicist, said Bonnafé gave him counsel when he became chief executive of advertising group Publicis in 2017.

“He spent a lot of time telling me ‘it will be hard but you’ll get there’.”

Rodolphe Saadé, head of Marseille-based shipping group CMA CGM, described Bonnafé as a straight talker: “He says things the way he sees them . . . when something is not possible he’ll say so”.

Bonnafé made his mark at BNP pursuing some of its biggest mergers, including a double bid for SocGen and Paribas in 1999 when he was head of strategy. The first offer was eventually dropped. 

He later helped integrate Italy’s Banco Nazionale di Lavoro, which BNP acquired in 2006, as well as Fortis’s operations in Belgium and Luxembourg. Internally, he has made little secret over how laborious the BNL deal was, after BNP had to grapple with its poor quality loan book — a cautionary tale for other cross-border mergers. 

Bonnafé has since favoured smaller deals, including the 2019 purchase of Deutsche Bank’s prime brokerage operations that serve hedge funds, to boost its standing in equities markets.

He has insisted a €7.6bn war chest set aside from the $16.3bn sale of US retail business Bank of the West will be spent on IT and system upgrades and incremental acquisitions to build up scale in areas such as asset management, insurance and consumer finance.

A diversified business, from car leasing group Arval to a wealth management arm, has also helped BNP’s steady growth. BNP used its balance sheet aggressively during the pandemic, expanding it by €500bn in mere months, to win over loan-starved corporate clients across Europe when US rivals temporarily retrenched.

The group reported a record €10.2bn annual profit in 2022.

When asked where he and the bank might go from here, Bonnafé shifted to the much broader challenge lenders face in serving societies that must rapidly transition to cleaner energy models.

He wants the bank to be at the forefront of clients’ financing needs for new infrastructure, and insisted BNP was now reducing its support to the oil and gas sector — albeit at its own pace, and not one that he said could “kill the economy”.

“There’s a lot to do,” Bonnafé said. “The last time was maybe just after the second world war if you look at the magnitude of what we need to invest to implement the transition.”

How long he will stay on to see that through is unclear. No dauphin has yet been anointed at a bank that has tended to promote from within.

In the words of one rival banker, “the only real thing Bonnafé has left to prove is to succeed in his exit, and leave at the right time before it’s deemed too long”.

>>> US After Hours Summary: Quiet after hours; CYRX -24.5% lower on weak guidanc

After Hours Summary: Quiet after hours; CYRX -24.5% lower on weak guidance; MLKN -3.6% lower on earnings; VSAT -20.9% falls on satellite mishap

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: None

Companies trading higher in after hours in reaction to news: WFRD +2.9% (awarded contract in Brazil), NEXT +2.7% (makes final decision to construct the first three liquefaction trains at Rio Grande LNG), LGF.A +2.6% (files Form 10 in connection with planned separation of its Studio and Starz units), AB +1.7% (reports June AUM), DIS +0.8% (extends CEO Iger's contract by 2 years), ROKU +0.6% (launches partnership with FreeWheel), R +0.2% (increases dividend)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: CYRX -24.5% (guides Q2 and FY23 revs below consensus), MLKN -3.6%

Companies trading lower in after hours in reaction to news: VSAT -20.9% (unexpected event may impact performance of ViaSat-3 Americas satellite), BLFS -7.2% (in sympathy with weak guidance from CYRX), IVZ -2.2% (reports June AUM), GTE -2% (provides operational update), BCYC -1% (commences $200 mln ADS offering), BEN -0.1% (reports June AUM), GWW -0.1% (to open distribution center in Oregon), TEAM -0.1% (Director sold 10000 shares)

>>> Google Quantum Computer Is '47 Years' Faster Than #1 Supercomputer

Google Quantum Computer Is '47 Years' Faster Than #1 Supercomputer

Progress towards fully capable and practical quantum computers isn't slowing down, and researchers from Google are the latest to announce a significant step forward in the capabilities of today's machines.


While we call these devices quantum computers, they're more like prototypes of what quantum computers can be: At present they require super-specific, extreme conditions to operate in, and struggle to stay stable and error-free.

Despite those limitations, their computing potential is becoming more impressive all the time.

The latest system run by Google has a total of 70 operational qubits – the quantum equivalents of classical bits that can represent 1, or 0, or both at the same time, potentially allowing for certain calculations to be performed at astonishing speeds.

Specifically, the team used a complex, synthetic benchmark called random circuit sampling, which is exactly what it sounds like – taking readings from randomly generated quantum processes.

This maximizes the speed of critical actions, reducing the risk of outside noise destroying the calculation. They then estimated how long it would take existing supercomputers to run the same sums.


"We conclude that our demonstration is firmly in the regime of beyond-classical quantum computation," write the researchers in their recent paper.

The Frontier supercomputer, currently the most powerful computer in the world, would take a little over 47 years to crunch the same numbers, the researchers suggest, whereas the Sycamore quantum computer managed it in mere seconds.

A group including Google engineers did something similar in 2019, with 53 qubits. Then, as now, there's a debate to be had about how useful and practical these particular simulations are, and how fair (or otherwise) it is to compare supercomputer performance to what has been managed here.

Nevertheless, the Google team is clear in its claims that this demonstrates quantum supremacy: the idea that quantum computers really can deal with processes above and beyond anything that even the fastest classical computers can cope with.


The new experiments also tell us more about how quantum noise – the inherent uncertainty and fragility in a quantum computer as it operates in the fuzzy landscape of probabilities – can have an impact on processes as they're running, and in some cases lead to new phases (or states) in a quantum system.

Working through this noise to correctly record qubit states is essential in getting quantum computers functioning properly, and we've seen scientists try and tackle the problem in a variety of ways in the past.

According to Steve Brierley, chief executive at quantum company Riverlane in the UK, these latest experiments represent another "major milestone" in quantum computing research.

"The squabbling about whether we had reached, or indeed could reach, quantum supremacy is now resolved," Brierley told The Telegraph.

A paper on the new research is available on arXiv but has yet to be peer reviewed