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Russia State Duma election will boost authoritarianism, experts say



A bus drives past a United Russia campaign poster put up ahead of the elections to the Russian State Duma of the 8th convocation scheduled for September 17-19.

Vladimir Smirnov | TASS | Getty Images

Russia will hold elections to the State Duma, the lower house of parliament, from Friday and experts expect the vote to consolidate President Vladimir Putin’s power base in the Kremlin.

It’s widely expected that the ruling United Russia party will secure a “convincing victory” in the vote that takes place between September 17-19, with one analyst noting that the election “heralds more authoritarianism” as a result.

“The Kremlin’s objective is to retain a constitutional majority, ensure the vote’s legitimacy, and avoid large-scale post-election protests. Major changes in the cabinet or the government’s policy direction are unlikely after the vote,” Andrius Tursa, Central and Eastern Europe advisor at Teneo Intelligence, said in a note ahead of the vote.

Around 108 million voters in Russia have a right to elect 450 members of the State Duma for a five-year term. Voting this year is taking place over a three-day period due to the Covid-19 pandemic. United Russia has been the dominant party in the country for decades and it enthusiastically supports Putin although he has run as an independent candidate since 2018.

Adeline Van Houtte, Europe analyst at the Economist Intelligence Unit, noted Wednesday that the vote will be an important test for United Russia given insufficient financial support for businesses and households, together with a weakening labour market that has dented the party’s popularity in recent years.

“United Russia is now polling at around 30%, substantially lower than in 2016. Despite its poor ratings, it maintains a comfortable lead over its biggest competitors. We expect United Russia and other pro-Kremlin affiliates to retain a large majority in the Duma.”

Crackdown on opponents

Analysts expect there to be little transparency when it comes to electoral standards given increasingly limited press freedom and efforts to suppress and neutralize political opposition in Russia — most notably, the imprisoned opposition leader Alexei Navalny and his supporters.

Van Houtte said a major crackdown on real and perceived opponents is intensifying ahead of the parliamentary election “and is likely to continue afterwards.”

Despite imprisoning Navalny earlier this year, Russia’s authorities have continued the dismantling of the activist’s opposition movement and support base.

In June, three political associations linked to Navalny were outlawed and branded as “extremist”, meaning that any member of the organizations or supporters of Navalny can face prison terms and be barred from running for public office.

“Considering the limited presence of international observers and a sweeping crackdown on the opposition, independent media, and civic organizations during the past year, the upcoming election will be the least transparent and competitive during President Vladimir Putin’s 20+ years in power,” Tursa said, adding that United Russia was still set to secure an absolute majority of seats and could retain a constitutional majority in the lower chamber despite a recent decline in popularity.

Token opposition

Russia analysts say the election has the appearance of a democratic vote but that, in reality, it is closely controlled by the state and other parties on the ballot paper are token opposition parties approved by the Kremlin.

“So-called systemic opposition parties” are currently represented in the State Duma, Tursa noted, citing the Communist Party of the Russian Federation, the Liberal Democratic Party of Russia and a Just Russia-For Truth as well as a new party called New People, which is targeting disappointed urban voters. These parties don’t represent “genuine opposition,” he said.

“As a result, the Duma will remain strongly supportive of the Kremlin,” Tursa noted.

For the Kremlin, Tursa said there were three objectives. Primarily, “to reaffirm United Russia’s undisputed control of the State Duma by maintaining a constitutional majority, which holds practical and symbolic significance ahead of the 2024 presidential election.”

Secondly, the Kremlin wants “to maintain legitimacy among political elites and the wider electorate by ensuring good turnout, a credible outcome of the vote, and limited reports of any electoral irregularities”

And thirdly, it wants to avoid widespread protests such as those seen after the 2011 legislative election or in neighboring Belarus last year, Tursa said.

What about the economy?

Major changes in the cabinet or the government’s policy direction seem unlikely given that the ruling party’s program continues long-standing key policy areas such as the well-being of families, infrastructure development of Russia’s regions and the protection of the country’s interests abroad, Tursa said.

Liam Peach, emerging markets economist at Capital Economics, agrees that United Russia will hold onto its majority but noted that the “political backdrop is fragile” and the government could soon intervene more in the economy.

“Public support for United Russia has dropped sharply over the past five years and President Putin’s approval rating is hovering near record lows. The stagnation in real incomes since 2013 may have a played a part in this,” he said in a note Wednesday.

“A key implication of this tension is that the government has taken an increasingly interventionist approach in the economy in an effort to support households. One strand to this is social welfare provision, which has become a key priority for the government. Cash payments to families, children, pensioners and military personnel have been announced ahead of September’s elections.”

Peach said his team believed the emphasis on social support will become permanent in Russia.

“This shift towards higher social spending has its roots before the pandemic and was presented alongside President Putin’s plans to amend the constitution. With the depths of the crisis having passed and a rebound in oil prices boosting the public finances, it seems that the government has started to rekindle these plans and bring issues around the standard of living higher up its agenda.”

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FDA clears Modnera and J&J Covid boosters, allows ‘mix and match’ shots



The Food and Drug Administration Wednesday night authorized booster shots of both Johnson & Johnson and Moderna’s Covid vaccines, another critical step in distributing extra doses to tens of millions of people.

At the same time, U.S. regulators also authorized “mixing and matching” vaccines, allowing Americans to get a booster shot that’s a different vaccine from the one used for initial doses.

“Today’s actions demonstrate our commitment to public health in proactively fighting against the COVID-19 pandemic,” acting FDA Commissioner Dr. Janet Woodcock said in a statement.

“As the pandemic continues to impact the country, science has shown that vaccination continues to be the safest and most effective way to prevent COVID-19, including the most serious consequences of the disease, such as hospitalization and death,” she added.

The FDA clearance, which was expected, came after the agency’s Vaccines and Related Biological Products Advisory Committee last week unanimously recommended additional shots of both vaccines. The committee recommended Moderna boosters for the elderly and at-risk adults six months after completing their primary series of shots — bringing it in line with Pfizer’s distribution plan — while endorsing J&J boosters for everyone 18 and older who received the initial shot at least two months ago.

The ruling will now be handed off to the Centers for Disease Control and Prevention and its vaccine advisory committee, which has scheduled a meeting Thursday to discuss Moderna and J&J’s booster data. If the committee issues a recommendation, and CDC Director Dr. Rochelle Walensky signs off, additional shots for those vaccines could be distributed immediately to eligible people.

The authorization would open booster doses up to the more than 15 million people who’ve been inoculated with J&J’s shots and the more than 69 million people who have been fully immunized with Moderna’s vaccine.

Eligible Americans will also be able to “mix and match” vaccines. A highly anticipated National Institutes of Health study published last week showed all the combinations of boosters increased antibody levels higher, though Pfizer’s and Moderna’s boosters appeared to work best.

The FDA said Wednesday it has identified an increased risk of rare inflammatory heart conditions, myocarditis and pericarditis, following vaccination with the Moderna vaccine, particularly following the second dose. Usually, onset of symptoms has been a few days following vaccination, it said. The observed risk is higher among males under 40 years of age, particularly males 18 through 24.

Pfizer’s boosters were authorized less than a month ago to a wide array of Americans, including the elderly, adults with underlying medical conditions, and those who work or live in high-risk settings, such as health-care and grocery workers.

Booster shots have been a contentious topic for scientists — in and outside the government — especially as many people in the U.S. and other parts of the world have yet to receive even one dose of a vaccine. The World Health Organization has pleaded with wealthy countries to hold off on distributing boosters, and some scientists say they aren’t convinced most Americans need them right now.

Some committee members said Thursday the boosters should prevent so-called breakthrough infections, which they said is critical for protecting health-care institutions from becoming overwhelmed, while other members said the third shots should ensure those at high risk won’t suffer from severe disease. Some on the committee also suggested young people may not need boosters, as the initial shots are still holding up in those groups.

The Biden administration hopes giving the U.S. population additional doses will ensure long-term and durable protection against severe disease, hospitalization and death as the fast-moving delta variant continues to spread.

Unlike Pfizer’s and Moderna’s two-shot messenger RNA vaccines, J&J hoped to offer a one-shot solution that would protect the public enough to help bring an end to the coronavirus pandemic. But its protection at 72% in the U.S. was viewed by some as inferior to Moderna’s and Pfizer’s vaccines, which both touted efficacy rates above 90%.

A second dose of J&J’s shot boasts similar performance to the mRNA vaccines, boosting protection from symptomatic infection to 94% when administered two months after the first dose in the United States, according to data submitted to the FDA by the company. J&J’s vaccine uses a modified adenovirus to induce an immune response.

Still, FDA scientists published an analysis last week on J&J’s application for a booster, questioning the strength of the data. The FDA said people may benefit from a second dose, but added the information provided by the company was limited and the agency hadn’t verified all of it yet.

Before the vote Friday, many committee members said J&J should be considered a two-dose vaccine much like Moderna’s and Pfizer’s.

Some committee members even asked the agency whether they could postpone a decision on boosters for J&J recipients, saying it may be too early as there are still a number of outstanding questions. Other members wondered why the agency brought J&J’s application before the committee before it was able to verify all of the data.

“Is there an option of saying it’s a little early? There are a number of issues that are still outstanding,” said Dr. Cody Meissner of Tufts University. “There are a lot of uncertainties, at this point, making it hard to vote for or against this tonight.”

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SpaceX to become more valuable than Tesla: Morgan Stanley survey



Starship prototype SN15 returns for a landing on May 5, 2021 after a high-altitude flight test.


Between Elon Musk’s two largest companies, investors and experts have a long-term favorite.

Most “institutional investors and industry experts” surveyed by Morgan Stanley expect SpaceX to become more valuable than Tesla and see it as a more attractive investment.

“The majority of our clients (by survey and client discussions) believe SpaceX could ultimately command a higher valuation and significance than even Tesla,” Morgan Stanley analyst Adam Jonas wrote in a note Tuesday.

Tesla has a market value of $858 billion. SpaceX reached a valuation of $100.3 billion after a secondary share sale, CNBC reported earlier this month.

Morgan Stanley issued the survey about Musk’s companies with two questions: “Which do you think is a more attractive investment from here?” and “Which do you think has the potential to be a more valuable company over the long term?”

Out of 32 responses, 63% of those Morgan Stanley surveyed answered SpaceX to both questions.

“From our investor conversations, the sentiment on SpaceX has increased substantially along with the company’s valuation in the private market,” Jonas said.

SpaceX: The “Apex Player” in space

Jonas said that “investors are beginning to appreciate the potentially wide-ranging use-cases for SpaceX’s reusable launch architecture across communications, transportation, earth observation and other space-related domains.”

SpaceX is “clearly seen” as the “Apex Player” in the global space industry, Jonas said. The sentiment shows in its soaring valuation, which makes it the second-most valuable private company in the world, according to CB Insights.

The company’s valuation has spiked in the last few years as SpaceX has raised billions to fund work on two capital-intensive projects: Starship and Starlink.

Starlink is the company’s plan to build an interconnected internet network with thousands of satellites, known in the space industry as a constellation. The project is designed to deliver high-speed internet to consumers anywhere on the planet.

SpaceX has launched 1,740 Starlink satellites to date. The network has more than 100,000 users in 14 countries who are participating in a public beta. Service is priced at $99 a month.

Starship is the massive, next-generation rocket SpaceX is developing to launch cargo and people on missions to the moon and Mars. The company is testing prototypes at a facility in southern Texas and has flown multiple short test flights.

Reaching orbit is the next step in testing the rocket. SpaceX is awaiting regulatory approval for its next launch.

“In our view, having access to nearly unlimited sources of capital will be an extremely important part of the narrative around building the space economy,” Jonas added.

Morgan Stanley, in a separate note Monday, also said that “more than one client” has suggested that Musk may become the first trillionaire, because of SpaceX.

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Tesla TSLA earnings Q3 2021



Tesla Motors CEO Elon Musk unveils a new all-wheel-drive version of the Model S car in Hawthorne, California October 9, 2014.

Lucy Nicholson | Reuters

Tesla reports third-quarter results on Wednesday after the bell.

Here’s what analysts are expecting:

  • Earnings per share (adjusted): $1.59 expected per Refinitiv
  • Revenue: $13.63 billion expected per Refinitiv

The company previously reported deliveries of 241,300 electric vehicles and production of 237,823 vehicles during the period ending September 30, 2021.

Unlike other automakers, Tesla’s sales rose during the quarter, setting a new company record, despite chip shortages and supply chain challenges weighing on the industry. (Deliveries are the closest approximation of sales that Tesla reports.)

Last quarter, CEO Elon Musk said he would no longer lead earnings calls by default. He may choose not to address shareholders and analysts on Wednesday, which would surely disappoint his fans.

Investors submitted questions to Say Technologies, a site Tesla uses to poll shareholders ahead of earnings calls, seeking updates on the now-delayed Cybertruck, Tesla’s 4680 battery cells, and whether a $25,000 electric car, which Musk teased last year, is still underway.

Tesla’s strategy for weathering supply chain issues will also be in focus, along with the company’s ongoing investments in and sales of cryptocurrency and regulatory credits.

Ahead of the report, Bank of America raised its price objective for Tesla shares higher to $900 per share from $800.

BofA research analyst John Murphy, in a note to investors on Tuesday, laid out downside risks and upside potential for Tesla. Improving battery tech could be a boon for the company, he suggested, but if better battery cells don’t come about as soon as hoped, that could slow Tesla’s roll. Competition from incumbent automakers is also growing, he noted. Loss of management, a perpetual risk, could cause share prices to decline, too.

BofA raised its price target because Tesla has a “track record of growth, consistent capital raises, and overall investor hype.” Tesla could also potentially benefit from increases in federal or state incentives, rising gasoline prices, better execution and cost containment, and benefit from short sellers covering their positions.

Loup Ventures’ Gene Munster, who is also bullish Tesla, told CNBC ahead of the Q3 report that while competition in battery electric vehicles is building, he believes Tesla will still gain market share in the broader car market.

“It’s a simple equation to stay ahead of all of the upcoming competition, sell at scale the best value EV. That is a combination of design, range, advanced driving features and buying experience,” he said.

According to the latest numbers from Alix Partners, electric vehicles including fully battery electric cars like Tesla’s are on a path to comprise 28% of all new light commercial and passenger car sales worldwide by 2030.

The Biden administration is targeting a 50% overall reduction in greenhouse gas emissions by the US by 2030.

According to a 2021 study by Common Energy Labs, the transportation sector is the single largest driver of greenhouse gas emissions in the US today, representing about 28% of total emissions. The majority of transportation emissions derive from passenger vehicles, light- and medium-duty trucks. No significant reduction in greenhouse gas emissions can be achieved in the US without both electrifying these vehicles, and moving the power sector off of fossil fuels.

This is a developing story. Check back for updates.

— CNBC’s Michael Wayland contributed reporting.

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