Good morning! While El Salvador was hogging the newsprint for its crypto-friendliness, India’s eastern neighbour was slipping under the radar for its Bitcoin mining operations… until now. Forbes reports that Bhutan—which produces as much electricity per capita as the United States thanks to its vast hydropower resources—has been a crypto paradise since 2019. Worryingly, the country’s state-owned Druk Holding & Investments has poured millions into crypto holdings and been exposed to bankrupt entities such as Celsius and BlockFi. Bhutan says there’s nothing to worry about, but here’s hoping the mountainous kingdom reads the room. If you ask us, there’s more value in a Gross National Happiness index than crypto-anything.

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Today’s edition also features pieces by Julie Koshy Sam, Venkat Ananth, Srijonee Bhattacharjee, and Jaideep Vaidya.

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The Market Signal*

Stocks & economy: Indian equities may retreat after a six-day forward march on gloomy vibes from Asian and US markets.

US bank stocks were bludgeoned despite the rescue buyout of First Republic by JP Morgan over the weekend. Shares of banks PacWest and Western Alliance led the rout as concerns deepened about financial sector stability. So much so that investors are cutting back expectations of a much-anticipated rate hike later today.

Hesitation to hike now may be a sign that the Fed foresees the banking crisis deepening. Worries that the US government may run out of cash in June without a decision on the debt ceiling also weighed down sentiment.

Oil fell 5% on fears of a palpable economic downturn.

Back home, airline Go First filing for bankruptcy may dent sentiment further.

AVIATION

Go First Goes Bust

Wadia Group-owned Go First has suspended flights from May 3-5 and filed for bankruptcy with the National Company Law Tribunal. This is the first time an Indian carrier has filed for insolvency since 2019—the year Jet Airways went under. Aviation regulator Directorate General of Civil Aviation (DGCA) has slapped the airline with a show cause notice for abruptly cancelling flights leaving passengers stranded.

As we’d summed up in past editions (here and here), the debt-saddled airline—which owes $685 million to Indian banks alone—had reported record losses in 2022, mostly on account of half its fleet being grounded due to engine issues. Pratt & Whitney (P&W), owned by American defence contractor Raytheon, is the exclusive engine supplier for Go First’s Airbus A320neo fleet and is tiding through supply chain issues.

Go First had also contended with a scuttled IPO plan and its promoters, the Wadias, wanting out.

ECONOMY

What’s The Cost Of Unpaid Household Work In India?

...that's what the Indian government wants to know. Per The Economic Times, it is considering methods such as a Time Use Survey to quantify the contribution of household chores to the country’s GDP, which currently overlooks unpaid labour.

Deets: According to the 2019 Time Use Survey, women spent 299 minutes (4.9 hours) daily on unpaid domestic services, compared with 97 minutes (1.6 hours) for men. A State Bank of India report pegs the value of unpaid work done by Indian women at 7.5% of the country's GDP. Incidentally, four out of five Indian women aren't part of the labour force, according to the World Bank.

Dire: If you thought those figures were staggering, get this: globally, women's unpaid labour was worth $10.9 trillion in 2020.

Also: Recognising household work could be a step towards gender equality. But who will pay women for the backbreaking work?

BANKING

JP Morgan: Advise & Rescue

At the end of hectic weekend parleys and bids, JP Morgan snagged the near-collapsed First Republic Bank.

The deal: JP Morgan will take over $173 billion in loans, $30 billion worth of securities, and $92 billion in deposits, including $30 billion deposited by 11 banks in a rescue operation a few weeks ago. It’ll pay the Federal Deposit Insurance Corporation (FDIC) $10 billion, but also share losses and recoveries with the agency. It expects to incur another $2 billion in transaction costs but also generate at least $500 million in incremental net income from First Republic, a brand that will be erased.

Worries linger: Although contagion fears have subsided for now, hotshots of the financial industry gathered at a Beverly Hills conference were uncomfortably discussing “root causes”.

🎧 Fashion brands put the spotlight on GenZs. Also in today's edition: a lowdown on the First Republic Bank fiasco. Listen to The Signal Daily on Spotify, Apple Podcasts, Amazon Music, Google Podcasts, or wherever you get your podcasts.

ENTERTAINMENT

There’s No One To Write Hollywood Scripts

If you’re a fan of Saturday Night Live and other late-night Hollywood shows, be prepared for some disruption. Live shows based on current events will face the immediate brunt of the strike called by 11,500 movie and TV writers in Hollywood against major studios and streaming platforms over compensation and working conditions.

It’ll be a while before the strike impacts the release of movies and TV shows, which take months to produce. However, Hollywood will hope the strike ends soon. The last time its writers went on strike, in 2007 for 100 days, the Los Angeles economy lost an estimated $2.1 billion.

Amazon moving FAST: The tech giant is doubling down on free, ad-supported streaming television (FAST) with the launch of Fire TV Channels.

Meanwhile: Rihanna, Lil Nas X, and Pedro Pascal were among those who slayed at the Karl Lagerfeld-themed 2023 Met Gala.

ARTIFICIAL INTELLIGENCE

(Das) Kapital Punishment

Those familiar with Karl Marx’s work will know about the labour theory of value (LTV). In essence, LTV says the value of a commodity is determined by the number of (human) labour hours required to produce it. But in a post-pandemic world dotted by tech and market routs, value is increasingly derived from efficiency—human or not.

Enter AI.

Over the next five years, IBM may automate 30% of its 26,000 non-customer-facing roles. One of these, ironically, is human resources. In toto, AI will make ~7,800 of IBM’s human jobs redundant.

Like IBM, Indian IT companies too want to boost efficiency. Not explicitly through AI, although that may become a natural progression in their quest to boost flagging utilisation rates—the percentage of staff working on active projects. Why? Consider this report in the Financial Times, which says younger workforces have weaker communication, networking, and collaborating skills.

FYI

Impact: American edtech company Chegg’s shares slipped by more than 40% after CEO Dan Rosensweig said ChatGPT is impacting its new customer growth rate.

Red signal: The Indian government has asked states to take “appropriate action” against outdoor advertising by gambling and betting platforms. This includes advertisements on hoardings, banners, and auto rickshaws.

End of innings: Former union minister and influential national leader Sharad Pawar stepped down as president of the Nationalist Congress Party, which he co-founded in 1999.

Add to cart: BharatPe has acquired a 51% stake in Mumbai-based non-banking financial company Trillion Loans. The acquisition will help boost its lending business.

Swapping out: Taiwanese electronics manufacturer Wistron is winding down its operations in India after a 15-year stint. The Tata Group will take over its iPhone factory in Karnataka.

Ka-ching: Pocket FM has raised $16 million in debt from Silicon Valley Bank. Content commerce company Hypd has also bagged $4 million in a funding round from popular creators such as Ranveer Allahbadia and Tanmay Bhat.

Branching out: US-headquartered cryptocurrency exchange Coinbase is going global with Coinbase International Exchange. The new exchange will cater to investors outside the US and initially enable trading of crypto derivatives, including Bitcoin and Ethereum.

THE DAILY DIGIT

456,082

The number of passengers who flew domestically in India on Sunday, April 30—a record high. (The Economic Times)

FWIW

Objects in the background...: are shallower than they appear. There is a growing tribe of people buying books just for the ✨ aesthetic.✨ Blame remote work and people using books or libraries as background props for video calls. A company named Books by the Foot is now selling titles according to colour, subject, and just book spines. Covogoods is taking things a notch higher and snapping together book spines so people can use them as storage space. Another New York-based interior designer is styling fake tomes for rich clients. This is a book of tricks we could do without.

No-go: Pokemon cards have long been an object of desire. Only last month, The Pokémon Company was out of cards in Japan. Now, a Japanese trading card store wants to shoo adults away from buying Pokémon Cards so that kids take to the game instead. As they should. There's a drought of the sought-after cards in the country as adult resellers put them up for sale online to collect decent 💰. This move seems like a bit of an overreach, considering adults are the ones with the money.

This is bananas: Maurizio Cattelan's $120,000 artwork—the banana that's duct-taped to a museum wall in Seoul—ended up becoming breakfast for a South Korean student. According to reports, the student reached out for the controversial art piece, Comedian, because he was hungry. Performance artist David Datuna ate the artwork back in 2019, calling it "performance art". Turns out the banana is replaced every three days. Tbh, no part of this experiment is a-peel-ing.