Charlotte Street Partners



Surprise, surprise

Written by Javier Maquieira, senior associate 
Edited by Tom Gillingham, associate partner
4 September 2020

Good morning,

The history of presidential elections in the United States is filled with many “October surprises”. Yet autumn campaign twists, which date as far back as 1800, may have become ever more bewildering since Hillary Clinton’s unexpected defeat against Donald Trump in 2016.
Less than a month away from another fierce October, expectation is mounting on what ace Trump’s campaign team may have up its sleeve. And with so much going on, there are plenty of options he could choose from.
One possibility is a coronavirus vaccine announcement, à la Putin, regardless of whether one has been proven safe and effective. The potential impact of this surprise may have been diminished, however, as the US Centers for Disease Control and Prevention has already asked state public health officials to prepare for distributing a potential Covid-19 vaccine to high-risk groups as soon as late October.
Alternative topics for a last-minute attempt to undermine Joe Biden’s candidacy range from bringing troops home from overseas postings or a grand gesture in Iran, to threatening to reject election defeat. Some argue the biggest October surprise will be that there won’t be an October surprise after all.
What certainly won’t be shocking for many readers is the fact that this campaign could, once again, come to be defined by disinformation. Only this week, both Facebook and Twitter announced the suspension of “accounts for platform manipulation that we can reliably attribute to Russian state actors” targeting public debate in the US and elsewhere.
report by social media monitoring company Graphika later concluded that these accounts were seeking to amplify a website called PeaceData, where individuals associated with the Kremlin-backed Internet Research Agency had designed a campaign to convince left-leaning voters that Biden is too centrist.
Micro-targeted ads can be particularly sneaky, as they allow politicians and supporters to parade unchecked, fictional content. In order to tackle these, Facebook’s chief executive, Mark Zuckerberg, has said the social media platform wouldn’t be taking on any new political ads in the seven days prior to the US election on 3 November. But he didn’t provide much reassurance on what may happen before 27 October.
Microsoft, on the other hand, is launching new deepfake-detecting tech under the name of Microsoft Video Authenticator that can analyse images and videos to give “a percentage chance, or confidence score, that the media is artificially manipulated”. Although deepfakes are getting increasingly sophisticated, the big tech company is hopeful the Authenticator will be able to catch misinformation ahead of the elections.
But this is America. Spectacle is guaranteed. And while an October – or indeed November – surprise might be on the cards, the question remains: will it make a difference?


The US Democratic presidential candidate, Joe Biden, has spoken over the phone with Jacob Blake, the black man who was shot in the back in Kenosha, Wisconsin, and remains in hospital paralysed. Speaking at a church meeting in the city where the shooting took place, Biden said Blake had told him “he was not going to give up” whether he walked again or not. The Democratic candidate added that while he sought common ground, President Trump was actively obstructing racial progress.
Nations across the UK have made different decisions on their quarantine lists in another break from the previous UK-wide approach to the issue. While travellers from Portugal will have to isolate when arriving in Scotland and Wales, England and Northern Ireland have confirmed no changes to their current travel quarantine rules. The situation has sparked confusion among holidaymakers in the southern European country.
The UK government is facing calls to revoke the appointment of former Australian PM Tony Abbott as a trade adviser for his misogynistic and homophobic comments and his dismissal of the climate emergency. While a final announcement on Downing Street’s choice for the Board of Trade has been delayed, health secretary Matt Hancock stressed in a TV appearance yesterday that Abbott had a “huge amount of expertise” in international trade, despite insisting on his own contrasting opinions with the former Australian PM.

Business and economy

Chancellor Rishi Sunak is set to dismiss calls from the City of London to create a new state-owned body able to issue tens of billions of pounds of coronavirus loans to British companies. Ministers have rebuffed the proposals, as they fear could lead to a shift of burden towards taxpayers. The Treasury has also rejected the ideas around recapitalisation of bad loans, as it believes banks should deal with the cost and reputational risk of chasing borrowers that default. (£)
Construction work on the HS2 rail project begins today with a pledge to create 22,000 jobs in the next few years. The prime minister, Boris Johnson, said the HS2 – which will ultimately link London, Birmingham, Manchester and Leeds – would “fire up economic growth and help to rebalance opportunity”. It is hoped the 20-year project will reduce passenger overcrowding and help rebalance the UK’s economy through investment in transport links outside London.
Angela Merkel is facing mounting pressure to end her support for the joint German-Russian Nord Stream 2 after scientists confirmed Russian opposition leader Alexei Navalny had been poisoned. Politicians across the political spectrum have asked the German chancellor to use the halt of the nearly finished twin pipeline to press the Kremlin into answering allegations over the “silencing” of Navalny.

Columns of note

Merryn Somerset Webb argues in the Financial Times that it seems unlikely that people in the UK will get away without tax rises in this crisis. While wealth taxes won’t raise enough money to deal with the problem, Somerset Webb writes rises in income tax can’t do much for the British economy in the short term either. (£)
In The Guardian, Stephen Buranyi looks at how the Covid-19 pandemic has brought together conspiracy theorists and the far right in a deliberate break with our shared reality. He concludes: “as long as a vibrant anti-public discourse is still thriving on the fringes, it will continue to crash into the mainstream.”

Cartoon source: The Telegraph


What happened yesterday? 

London stocks closed in the red on Thursday as investors eyed the latest reading on the UK services sector. The FTSE 100 ended the session down 1.52% at 5,850.86, while Sterling was weaker against both the dollar by 0.63% at $1.3266 and the euro by 0.44% at €1.1213.
Across the pond, tech stocks – which have powered US equities to record highs over the summer – dropped 3.5% yesterday, with the Nasdaq Composite index tumbling almost five per cent.
In company news:
Melrose Industries gained 12.59% after the industrial turnaround company announced big job cuts at its GKN Aerospace business as it reported a first-half loss of £560m.
Rolls-Royce rallied 5.7% after the engine maker won a contract to provide the neutron flux monitoring system for two nuclear reactors under construction in China.
Capita’s stocks were up 3.24% despite the outsourcing company saying it had not received an offer from private equity firm CVC Capital Partners.
Meanwhile, Admiral lost 4.21%, BHP dropped 5.82% and Antofagasta was down 3.96% as their stock went ex-dividend.

What’s happening today?


Bank Audi Gdr
Berkeley Group
Ide Hldgs

Int. economic announcements
(07:00) Balance of Trade (GER)
(07:00) Current Account (GER)
(07:00) Factory Orders (GER)
(13:30) Unemployment Rate (US)
(13:30) Non-Farm Payrolls (US)

Source: Financial Times

did you know

A lightning bolt can generate heat in excess of 27760°C – a temperature five times hotter than the surface of the sun (source: @8fact).

Parliamentary highlights

House of Commons

No business scheduled

House of Lords 

No business scheduled

Scottish Parliament 

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