Your Evening Briefing
Clean energy is approaching a “tipping point,” according to Michael Liebreich, the founder of Bloomberg New Energy Finance. Liebreich today predicted that for some utilities, clean energy will soon become more economical than fossil fuels, thanks in part to the arrival of “monster” wind turbines. But some remain cautious, with one executive warning that promises by developers to build economically viable windfarms—without subsidies—may end in tears and hurt the industry’s reputation. — Andy Reinhardt
Brexit rift. U.K. Prime Minister Theresa May is locked in a battle with Boris Johnson that could alter her Brexit strategy. Johnson is reportedly ready to resign before the weekend if May proposes paying money to retain access to the European single market. Meanwhile, former Prime Minister Tony Blair told Bloomberg TV that he sees a 30 percent chance Brexit will be reversed and worries that a “hard” Brexit could usher in a hard-left socialist government.
Landmark. Norway’s sovereign wealth fund hit $1 trillion for the first time on Tuesday. The milestone valuation was reached with the help of climbing stock markets and a weaker U.S. dollar. But the fund’s sheer size has made it hard to find markets big enough to invest in. Norway’s politicians are also having trouble resisting the urge to raid the world’s biggest state piggy bank for government spending.
Doing fine. The Dutch economy is roaring along, politics be damned. A new government has yet to be formed after indecisive elections in March, but the country is growing at its fastest pace in a decade under the caretaker government of Prime Minister Mark Rutte. It’s an indication that systems put in place after Europe’s debt crisis in 2008 help shelter the country from instability abroad and political uncertainty at home.
One ’70s relic looks good. When residents of Berlin go to the polls on Sept. 24 to elect a German parliament, they’ll also be asked another question: whether to keep the Cold War-era Tegel Airport operating after the vastly-delayed Willy Brandt international is finally opened in 2019. The new airport is more than six years late and its price tag has more than doubled to around $6 billion. So-called “Tegel-savers” argue that the city’s other airports already serve more passengers than Brandt is designed to handle.
Baby problems. Finland has recorded the lowest number of newborns in nearly 150 years—since the great famine of 1868. The birth rate has been falling since the start of the decade. But the generous Finnish welfare state needs future taxpayers, and the current rate of 1.57 children per woman is too low to sustain it. How to get people to have more babies is a challenge that has stumped the government, which offers generous parental leave and one of the best education systems in the world.
Buyout eats Toys. Toys “R” Us, the ultimate toyland for a generation of postwar baby boomers, filed for bankruptcy due to a crushing debt load from a leveraged buyout and relentless competition from warehouse stores and online retailers such as Amazon. The chain, which has 1,600 stores in 38 countries, was taken private in 2005 in a $7.5 billion deal led by Bain Capital, KKR and Vornado Realty Trust that saddled it with huge debt. The company’s non-U.S. stores are not part of the Chapter 11 filing.
Little-known secret. The best caviar no longer comes from Russia, but from China. The world’s largest producer, Kaluga Queen, raises sturgeon in Qiandao Lake, 300 miles southwest of Shanghai, and sells their pricey eggs around the world to discerning customers. It’s now the caviar of choice at 21 of the 26 Michelin three-starred restaurants in Paris. Seafood specialist Eric Ripert serves it at Le Bernardin in New York. And Lufthansa offers it in first-class cabins.
Compiled by Andy Reinhardt and Leila Taha