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[PRESS RELEASE – Los Angeles, California, July 6th, 2023]
DeSo, the leading layer-1 blockchain for decentralizing social media, has issued a groundbreaking challenge: a $1 million bounty for visionary founders capable of building a decentralized competitor to Reddit using its infinite-state blockchain. This unprecedented opportunity arises amid escalating discontent with centralized social media platforms, which monopolize content and data.
Reddit recently sparked controversy within its community following a decision to limit API access. This move provoked a series of 48-hour subreddit blackouts in protest. This price hike for their API has forced existing third-party developers to shut down as maintaining their applications becomes impossible.
As Reddit prepares to go public, it is paving the way for fresh products and its in-house developer platform. Reddit CEO Steve Huffman revealed an interest in capitalizing on the platform’s wealth of data: “The Reddit corpus of data is really valuable,” he commented. “But we don’t need to give all of that value to some of the largest companies in the world for free.”
This controversy and others highlight the ongoing problems with centralized social media platforms. It’s not just Reddit; the landscape of web2 social media is changing. Over the past weekend, Elon Musk temporarily restricted the number of posts Twitter users can read per day, inciting significant backlash:
“To address extreme levels of data scraping & system manipulation, we’ve applied the following temporary limits: Verified accounts are limited to reading 6000 posts/day, Unverified accounts to 600 posts/day, and New unverified accounts to 300/day”.
Against this backdrop, DeSo is rising as a viable challenger.
Positioned at the forefront of social media disruption, DeSo offers up to $1M to support builders ready to architect an on-chain alternative to Reddit. This opportunity facilitates the creation of a user-led, creator-owned decentralized platform, one where you own your content as securely as you own your Bitcoin.
DeSo’s founder, Nader Al-Naji, reflected on the recent dissatisfaction with Reddit: “These protests represent a broader societal shift. They are indicative of a new paradigm in how creators and users interact with social media. As trust in mainstream media and corporations falters, people are gravitating towards platforms that grant them autonomy over their content and social graph, much like owning Bitcoin does with money.”
The DeSo Way
Imagine an on-chain Reddit where users hold full control over their content and cannot be censored or banned at the protocol level. This concept introduces the idea of ‘community as an asset,’ where users and moderators can directly own and monetize their content, transitioning from mere respect and clout to tangible rewards.
This is only possible on the DeSo blockchain, which offers novel monetization features, including creator coins, NFTs, tokens, tipping, etc. With DeSo, your identity, profiles, content, and social graph are 100% on-chain, fostering a censorship-resistant layer where the community can moderate at scale instead of a centralized gatekeeper.
This is a call to arms for ambitious founders and builders who want to make lasting changes to social media the DeSo way.
Investment and Applicant Criteria
DeSo is prepared to invest up to $1M to fund a Reddit competitor built on its platform. Ideal candidates are seasoned founders with robust technical expertise and a proven history of building consumer products from the ground up.
Candidates should thoroughly understand DeSo’s vision for a decentralized Reddit and have strategies for user acquisition and engagement in a crypto-native way.
An enticing pitch demonstrating early signs of positive user feedback and usage is also expected. All applications should be submitted on Openfund.com to enable detailed evaluation.
For comprehensive instructions on how to apply and more information about how to apply, please read our original proposal and our formal announcement.
Once fully comprehended the opportunity at hand, please submit your proposal with all relevant links here.
About Deso
Raising $200 million from leading investors such as Sequoia, Andreessen Horowitz, Coinbase Ventures, and more, DeSo is a pioneering layer-1 blockchain whose mission is to decentralize social media, much like Bitcoin and Ethereum have decentralized finance.
Recently, DeSo has unveiled an array of groundbreaking innovations. Among these is Revolution, their breakthrough Proof-of-Stake mechanism, set to boost energy efficiency by 99% and position DeSo as one of the most deflationary layer-1s in all of crypto.
Additionally, Deso released four new app proposals, including Openfund 2.0, a DEX that works as seamlessly as centralized exchanges like Binance, allowing nearly instantaneous and anonymous trades while allowing users to maintain custody of their coins. | Crypto Trading & Speculation |
Two musicians have taken sustainable touring to the next level - walking 870 miles (1,400 km) with their instruments strapped to their backs.
While Beyoncé flies in a private jet, Filkins Drift have walked around Wales, performing almost 50 gigs.
After hiking through two named storms, Chris Roberts and Seth Bye finish their 60-day tour in Chepstow, Monmouthshire, on Tuesday.
They said the music industry has to change its "mindset" on sustainability.
The subject of how musician's tour hit the headlines in the summer when Beyoncé arrived for a gig in Cardiff by private jet, while Coldplay's Chris Martin took the train to the city a few weeks later.
Chris Roberts, from Cardiff, said: "We're not at all suggesting that everyone should give up driving and walk to all their gigs because it has completely taken over our lives, but things like choosing more sustainable routes (should be considered)."
The guitar player said the 27-year-olds had discovered "how little stuff" they need to gig, each carrying a 15kg (33lb) bag.
Seth, from Gloucestershire, said: "I've got kind of a medium-sized backpack and using an elaborate system of carabiners, my fiddle is strapped to the back of a bag, and I've also got the mic.
"Chris has got his sort of massive guitar, which has got various bag straps on the outside of it and clothes stuffed in with the guitar."
The duo began their walk in Flintshire on 3 September, travelling through counties including Gwynedd, Ceredigion, Pembrokeshire, Swansea and Bridgend.
After more than 45 gigs and 60 days, the journey is set to finish in Chepstow, with Chris adding: "It's been mad because we've got a set of clothes that we walk in and one we do a gig in."
They said it has changed the way they plan to gig in the future, although it will probably be more focused on public transport than hiking.
The pair came up with the walking tour idea after lockdown.
Seth said when they began gigging again, their time was mostly "spent in a car stuck in a traffic jam, which isn't very good for the environment, or mental and physical health".
"We were just wondering whether there was a better way to tour," he said.
They were inspired by old Bardic traditions, said Chris, who added: "Walking like this isn't a new idea, it's something that has just been forgotten.
"This is actually how people used to work for years and years, especially around Wales, along the coast."
The guitarist said planning felt like a "massive puzzle" because they had to find venues every 15 miles (24km).
"Fortunately, almost every single village on the coast of Wales has either a chapel, a pub - or both," he said.
However they had to get creative in some areas, with places such as Llanelli Wetland Centre putting on a gig for the first time.
Chris said another aspect of their tour has been to bring live music to communities and places that do not often have access.
"We're raising money for a charity called Live Music Now, who brings music to people who can't come out to conventional concerts - so care homes and special needs schools and hospitals and things like that," he said.
In the two months the pair have been walking, two named storms hit the UK.
Seth said: "We've been ridiculously lucky with the weather - Storm Agnes was meant to hit us but completely missed.
"It's been phenomenal - we've had days where we finish the walk and get to the venue and then it just starts tipping it down."
They said there was one day, where they were hiking Yr Eifl, a group of hills on the north coast of the LlÅ·n Peninsula in Gwynedd, where they got "absolutely drenched".
"Neither of us had quite figured out the waterproofing strategies for the bags - various waterproof covers secured with shoelaces and duct tape," Seth said.
They also managed to avoid the worst of Storm Babet.
People would call "out of the blue" to offer their home for the night.
Seth said, despite having walked for two months, they have had "no blisters, no aches and pains" despite the fact they had "not actually trained" for the journey.
"We walk all day, we have an hour for food, and then we do a gig, it's just back to back - to start with it felt incredibly daunting, but now we have just settled into the natural rhythm of life," he said. | Renewable Energy |
Civil servants face a crackdown on working from home as ministers plan the end of the “Tuesday to Thursday” office culture in Whitehall.
Downing Street is preparing to issue new guidance to all Government departments ordering them to make sure more staff return to their desks.
It will target mandarins who regularly choose to log in remotely on Mondays and Fridays, a trend that has prompted growing alarm in No 10.
Jeremy Quin, the Paymaster General, will launch the push as part of efforts to boost public sector productivity, which has plummeted post-Covid.
Government sources told the Telegraph that ministers have become increasingly concerned by the impact of working from home on Whitehall delivery.
They are determined to reverse the pattern, which has seen mandarins choose to attend the office on Tuesdays, Wednesdays and Thursdays.
Departments were on average only half full last week, according to official statistics, with none getting more than two thirds of staff at their desks.
Mr Quin has ordered Whitehall managers to draw up new advice on the best ways the Government can drive up those attendance figures.
‘This isn’t some fishing expedition against the Civil Service’
A source close to him told the Telegraph: “This isn’t some fishing expedition against the Civil Service – it’s about delivering for the taxpayer.
“To be clear, we expect civil servants to be in the office wherever needed to drive delivery.
“The taxpayer forks out for government buildings and rightly expects them to be used.
“Equally, junior staff cannot be expected to learn from behind their desks at home.”
Mr Quin is concerned that working from home is currently treated informally within Whitehall, with decisions often taken on an ad hoc basis.
He is said to be pragmatic about the fact that some staff can fulfil their roles remotely, but believes that the majority perform better when at the office.
Ministers are looking at a range of options to firm up the system, such as a requirement for mandarins to seek permission to work from home.
Other options include introducing a new requirement for officials to work a set number of days in the office, which will probably be fixed at four a week.
However, such changes would set up a battle with the unions given that they would require changes to be made to civil servants’ contracts.
Downing Street is also looking at quicker fixes, such as forcing Whitehall managers to justify how decisions on working from home are made.
New guidelines
It is hoped that making departments disclose all their informal arrangements would discourage the practice by shining a spotlight on it.
In the longer term ministers are also considering changing contracts for new Civil Service starters to write in a requirement to attend the office.
Mr Quin is expected to issue the new guidelines to departments early this autumn.
He is also working on introducing performance-related pay to Whitehall, meaning that those officials who are most productive will earn bigger bonuses.
It is anticipated that the reforms will work together to dramatically boost attendance rates.
Downing Street has moved to crack down on working from home after a number of big companies said that they are making staff return to their desks.
Ministers are keen to learn from the private sector, where productivity has more strongly bounced back from the pandemic.
Output from business now stands at 1.3 per cent higher than it was pre-Covid, whereas it is 5.7 per cent lower for public bodies, which includes the civil service.
Jeremy Hunt, the Chancellor, has ordered a review of stagnating public sector productivity with the aim of growing it by at least 0.5 per cent per year.
It comes after new figures revealed that civil service pay has surged, with the number earning more than £100,000 a year having nearly doubled.
The data suggested that Whitehall was using over-promotion of officials as a loophole to get around pay-rise constraints imposed by ministers. | Workforce / Labor |
After 15 days of testimony, the jury has reached a verdict in, which is among the highest-profile financial crime cases in years.
The verdict is expected to be announced in approximately 10 minutes.
Jury deliberations began Thursday afternoon after U.S. District Judge Lewis Kaplan read aloud 60 pages of instructions to the 12-person panel, telling jurors to remain until 8:15 p.m. EDT and offering free pizza and Uber rides home.
The 31-year-old former cryptocurrency billionaire opted to testify in his own defense, a move regarded as legally dicey for a man facing a potential prison term of more than a century if convicted of the seven counts of fraud, conspiracy and money laundering with which he's been charged.
The MIT graduate steadfastly maintained his innocence since his arrest late last year after the startling implosion of FTX, the crypto exchange he co-founded, amid an $8 billion shortfall in funds and allegations he had used customer money to prop up his struggling hedge fund, Alameda Research.
Bankman-Fried was accused of using some of that money to buy real estate, make political contributions and finance pet charitable projects, among other purposes unconnected to FTX's business of letting people buy and trade digital currencies.
More broadly, FTX'scast a cloud over the entire crypto industry, as the sudden collapse of other major industry players vaporized billions in client wealth.
Bankman-Fried's attorney and federal prosecutorsto a New York City juror on Wednesday after more than four weeks of testimony.
Witnesses for the prosecution included Caroline Ellison, Nishad Singh and Gary Wang, all of whom once worked for Bankman-Fried at FTX or Alameda and all of whom pleaded guilty to multiple charges including participating in an alleged scheme to defraud millions of customers.
The three accused him of orchestrating the use of FTX customer money to make purchases ranging from a luxury condo in the Bahamas to covering losses at Alameda, Bankman-Fried's cryptocurrency hedge fund.
Ellison testified Bankman-Fried directed her to siphon money from FTX customer accounts to fund investments and trading strategies at Alameda, where she was CEO until it and FTX collapsed. FTX co-founder Wang detailed how he and the defendant engaged in financial crimes and lied about it, while Singh, FTX's former director engineering, detailed how Bankman-Fried spent FTX money.
Defense attorneys sought to portray Bankman-Fried as a math nerd who made poor management decisions at FTX, but who had nothing criminal in mind while building his crypto empire.
Bankman-Fried testified that he believed Alameda's spending came from corporate, not customer, funds, and that any mistakes he made were not ill-intentioned.
FTX was intended to "move the ecosystem forward," he testified during the proceedings. "It turned out the opposite of that."
Kaplan appeared skeptical of the arguments presented by Bankman-Fried's lawyers. Kaplan also repeatedly interrupted Bankman-Fried's testimony, at one point admonishing him to "just answer the question."
"Jurors take their direction, whether it's explicit or implicit, from a judge and [Kaplan] has also been pretty harsh with Sam Bankman-Fried's lawyers. The jury doesn't miss that," according to CBS legal analyst Rikki Klieman, a former defense lawyer.
Prosecutors called 16 witnesses while the defense called three, including Bankman-Fried, who appeared close to tears as his lawyer wrapped up closing arguments, according to multiple news outlets.
for more features. | Crypto Trading & Speculation |
The U.S. government dealt a massive blow to Binance, the world's largest cryptocurrency exchange, which agreed to pay a roughly $4 billion settlement Tuesday as its founder and CEO Changpeng Zhao pleaded guilty to a felony related to his failure to prevent money laundering on the platform.
Zhao stepped down as the company's chief executive, and Binance admitted to violations of the Bank Secrecy Act and apparent violations of sanctions programs, including its failure to implement reporting programs for suspicious transactions.
"Using new technology to break the law does not make you a disruptor, it makes you a criminal," said U.S. Attorney General Merrick Garland, who called the settlement one of the largest corporate penalties in the nation's history.
As part of the settlement agreement, the U.S. Treasury said Binance will be subject to five years of monitoring and "significant compliance undertakings, including to ensure Binance's complete exit from the United States." Binance is a Cayman Islands limited liability company.
The cryptocurrency industry has been marred by scandals and market meltdowns.
Rival of FTX founder
Zhao was perhaps best known as the chief rival to Sam Bankman-Fried, the 31-year-old founder of FTX, which was the second-largest crypto exchange before it collapsed last November. Bankman-Fried was convicted earlier this month of fraud for stealing at least $10 billion from customers and investors.
Zhao, meanwhile, pleaded guilty in a federal court in Seattle on Tuesday to one count of failure to maintain an effective anti-money-laundering program.
Magistrate Judge Brian A. Tsuchida questioned Zhao to make sure he understood the plea agreement, saying at one point: "You knew you didn't have controls in place."
"Yes, your honor," he replied.
Binance wrote in a statement that it made "misguided decisions" as it quickly grew to become the world's biggest crypto exchange, and said the settlement acknowledges its "responsibility for historical, criminal compliance violations."
U.S. Treasury Secretary Janet Yellen said Binance processed transitions by illicit actors, "supporting activities from child sexual abuse to illegal narcotics, to terrorism, across more than 100,000 transactions."
Binance did not file a single suspicious activity report on those transactions, Yellen said, and the company allowed more than 1.5 million virtual currency trades that violated U.S. sanctions, including ones involving Hamas' al-Qassam Brigades, al-Qaida and other criminals.
The judge set Zhao's sentencing for February 23, however it's likely to be delayed. He faces a possible guideline sentence range of up to 18 months.
One of his attorneys, Mark Bartlett, noted that Zhao had been aware of the investigation since December 2020, and surrendered willingly even though the United Arab Emirates — where Zhao lives — has no extradition treaty with the U.S.
"He decided to come here and face the consequences," Bartlett said. "He's sitting here. He pled guilty."
Zhao, who is married and has young children in the UAE, promised he would return to the U.S. for sentencing if allowed to stay there in the meantime.
"I want to take responsibility and close this chapter in my life," Zhao said. "I want to come back. Otherwise I wouldn't be here today."
Company sent investor assets to third party
Zhao previously faced allegations of diverting customer funds, concealing the fact that the company was commingling billions of dollars in investor assets and sending them to a third party that Zhao also owned.
Over the summer, Binance was accused of operating as an unregistered securities exchange and violating a slew of U.S. securities laws in a lawsuit from regulators. That case was similar to practices uncovered after the collapse of FTX.
Zhao and Bankman-Fried were originally friendly competitors in the industry, with Binance investing in FTX when Bankman-Fried launched the exchange in 2019. However, the relationship between the two deteriorated, culminating in Zhao announcing he was selling all of his cryptocurrency investments in FTX in early November 2022. FTX filed for bankruptcy a week later.
At this trial and in later public statements, Bankman-Fried tried cast blame on Binance and Zhao for allegedly orchestrating a run on the bank at FTX.
A jury found Bankman-Fried guilty of wire fraud and several other charges. He is expected to be sentenced in March, where he could face decades in prison. | Crypto Trading & Speculation |
Bread To Edible Oil Set To Get Dearer As Input Cost Inflation Pinches
Firms have been absorbing higher input costs to aid demand, but they now look to pass on the burden as they chase profitability.
A packet of whole wheat bread, a bottle of hair oil, a tub of ice cream or be it a container of ghee—consumers are most likely to be paying more for each of them as companies look to increase prices to cover for all the input cost inflation.
Commodities, such as crude oil, soda ash and food ingredients like wheat and milk that remain significantly higher in comparison to the previous year. Even as a few key inputs have softened from peak levels, the higher prices in the overall commodity basket have offset the benefit. And the challenge is particularly acute in the food industry, said top executives.
"Wheat is one commodity that remains on the boil," Britannia Industries Ltd. Managing Director Varun Berry said in a post-earnings conference call earlier this month. "After the April–June quarter, we have seen a drop in the wheat prices. However, in India, which is a fairly insulated market, the prices have been only going up."
Companies have been largely absorbing higher input costs to aid demand, but they now look to pass on the burden as they chase profitability.
Still, the proposed price hikes will not be as significant as the consumers have seen in the last two years when inflation shot up to record levels and the local currency devalued at a higher pace than before.
The biscuit maker, for instance, is looking at a 2.5–3% increase in product prices. "I don't think there is going to be a substantial price increase," Berry had said.
"It will only be opportunistic whenever necessary for certain stock-keeping units as I don't think we are going to see the kind of inflation that we have seen in the last two years for some time to come. And I am hoping that I am right."
Hindustan Unilever Ltd., India' largest consumer goods maker, also feels that food inflation in the country continues, albeit at a slightly lower level.
"Leaving aside palm oil, we have not seen the receding of inflation," Chief Executive Officer Sanjiv Mehta told investors earlier this month. "This is evident when you look at inflation from a two-year lens."
For instance, barley prices are up 120%, skimmed milk powder increased by 50% and commodities like crude oil and soda ash are seeing close to 100% inflation when compared to the December quarter of 2020, he said.
"When you have this kind of inflation, then obviously, we will have to pass on the cost to the consumers," Mehta said, without saying how much or which ones will attract higher prices.
The other source of inflation has been the impact of rupee depreciation as the dollar keeps strengthening. "The concentrates that we are importing because of the currency devaluation of Indian rupee vis-a-vis dollar, that has become dearer, and, therefore, there's a gross margin compression in our food business," Dabur CEO Mohit Malhotra said.
The company has taken a price increase in the range of around 6.5% and just about 4–5% in the food segment as against the total inflation of 8.5% in the quarter ended December. It is in the process of taking price increases in the food as well as hair oil portfolio.
Price of milk has gone up by about 10% cumulatively and it is expected to push up prices of butter, ghee, cheese and ice-creams. Mother Dairy Mother Dairy Fruit and Vegetable Pvt. Managing Director Manish Bandlish expects the raw milk prices to increase further till October on higher fodder costs, putting pressure on retail prices.
However, not all companies are looking to raise prices immediately as the demand environment is still fragile.
Parle Products Pvt. Senior Category Head Mayank Shah said the company's overall input mix doesn't warrant a price increase at the moment even as certain commodity prices are inflated.
"I don't think there is any immediate requirement of price hikes for us," Shah told BQ Prime. "We have already raised prices to cover most of the inflation to offset the pressure on margins. Our focus is now to bring back demand." | Inflation |
Bankers can earn unlimited bonuses again from Tuesday, following a change to rules brought in following the financial crisis.
Before 2008 City high-flyers hit the headlines for spending their bonuses on fast cars and champagne-fuelled nights.
The TUC warns removing the cap will bring back a "greed is good" culture.
But UK Finance, the body representing the sector, says scrapping the cap will make it easier to attract the best professionals from around the world.
Ruksana Uddin, from City recruitment firm Robert Half said she expects banks to start the process of bringing back bigger bonuses over the next few months.
"It will probably be at least a year before things start filtering through," she said. "Bankers going out, spending their money and doing those lavish things - we probably will not see that until 2025."
The cap was brought in across the European Union in 2014, limiting bonuses to a maximum of two times a banker's basic salary.
The aim was to make the financial system more stable by reducing the incentive for bankers to take excessive risks. But regulators and banks said it had not had the intended effect, because firms had switched to paying higher basic salaries to compensate for lower bonuses. Higher basic salaries are harder to reduce during a downturn, or take back if performance has been poor.
Ms Uddin thinks banks will ask their existing staff to switch back to the old system of a lower basic salary plus bonus.
There may be "some pushback" if current staff are reluctant to lose the security of the higher basic salary, she said.
But higher bonuses would have a "positive impact" on the market overall, she said, drawing in more "superbankers" from overseas.
The TUC, the umbrella body for the UK's trades unions, described the move back to bonuses as "obscene".
"City financiers are already raking it in," said TUC General Secretary, Paul Nowak. "They don't need another leg-up from the Tories."
A spokesperson for the Treasury said decisions on remuneration in the banking sector were made not by politicians but by the regulators. The original decision to scrap the cap on bonuses was announced by Kwasi Kwarteng in his September 2022 Budget. His successor Jeremy Hunt subsequently referred the decision to the regulators, the Prudential Regulation Authority and the Financial Conduct Authority.
UK Finance, representing the banking industry, said regulators had identified the bonus cap as one factor "limiting labour mobility" in the financial sector, and its removal would make the UK "more attractive to international professionals".
The optics of allowing bankers to be paid bigger bonuses were not good against the backdrop of the cost-of-living crisis, a UK Finance spokesman conceded. But it was not yet clear whether financial institutions would use the opportunity to increase bonuses significantly, he said.
Anne Sammon a partner at law firm Pinsent Masons said she thought "superstar" traders would see higher bonuses fairly quickly. But rules requiring a portion of the bonus to be deferred, and making it easier to claw back payments in the event of wrongdoing, meant there may not be quite the same big payday feel to bonus seasons in future, she said.
In terms of the wider workforce, banks were in for a bit of an "employee relations nightmare" Ms Sammon said.
"People will remember the days before the bonus cap, when people got five, six times their salary," she said, levels that wouldn't be returning without a big drop in base salaries, meaning firms would need to engage in some urgent "management expectation".
Offering different remuneration packages for new staff or staff from overseas could store up potential discrimination cases for the future, she said.
"The issue is likely to hit when we have bad years and the bonuses are down. It might not be an immediate issue, if we have a really good bonus year. But the next financial crash - people are likely to start arguing what is fair and what is not." | Banking & Finance |
Black Friday shopping takeaways and what they mean for the economy
Consumers have found some relief from inflation but face high borrowing costs.
Black Friday sales did gangbusters as the nation enters a holiday shopping season expected to test shoppers, who account for nearly three-quarters of U.S. economic activity.
Consumers spent a record $9.8 billion online on Black Friday, which marks a 7.5% increase over the year prior, according to Adobe Analytics.
Shopper visits, a metric used to assess in-person sales, rose 4.6% compared to a year ago -- a rate nearly double the average overall increase in foot traffic so far this year, retail data firm Sensormatic Solutions said.
Even more, consumers are expected to spend between $12 billion and $12.4 billion on Cyber Monday, which would make it the biggest online shopping day ever recorded, Adobe Analytics said.
A significant reduction of inflation over the past year has delivered some relief for consumers. At the same time, they've been squeezed by a decline in savings built up during the pandemic and a spike in borrowing costs for loans like credit cards and mortgages.
"The Christmas buying season got off to a good start, as Black Friday sales appear to be strong," Mark Zandi, chief economist at Moody's Analytics, told ABC News. "Consumers are hanging tough."
A host of key indicators bode well for consumers as the holiday season takes hold. The unemployment rate stands near a 50-year low, wage growth outpaces inflation and savings have been resilient for upper- and middle-income households, Zandi said.
The U.S. economy grew at an annualized pace of 4.9% over three months ending in September, more than doubling growth in the previous quarter and rebuking worries about a possible recession, a government report last month showed.
Black Friday sales data suggests that the good times for consumers may continue for the remainder of the year, Zandi said.
"While Black Friday isn't always a good guide to overall Christmas sales, this is a good sign," he noted.
Still, potential pitfalls remain for consumers and, by extension, the U.S. economy, Simeon Siegel, a retail analyst at BMO Financial Group, told ABC News.
Credit card debt climbed to a record high in the third quarter of 2023, surging nearly 5% from the previous quarter and leaving a growing share of borrowers late on payments, a Federal Reserve report earlier this month showed.
The growing debt has emerged alongside a spike in borrowing costs for loans from credit cards to mortgages that stems from interest rate hikes from the Federal Reserve.
Since last year, the Fed has raised its benchmark interest rate at the fastest pace in more than two decades, seeking to slash price hikes by slowing the economy and reducing consumer demand.
In theory, the economy should eventually falter as it becomes more expensive for businesses and consumers to borrow. The job market, for instance, remains robust but has slowed in recent months.
Broad economic trends offer ample "reason to be concerned," Siegel said. He noted, however, that Black Friday sales appeared to dispel fears of a worst-case scenario for consumers.
"The question was, 'Is it going to be such an overhang that it closes the cash registers and keeps people from going online and in stores?'" Siegel said. "The retailers' response would suggest that it was not."
Rosy inferences from the data deserve a note of caution, Siegel said. Consumers often spend during the holidays, even if it means shopping beyond their means, Siegel added, making Black Friday sales an imperfect shorthand for consumer health.
"The holidays have gotten off to a good start," Siegel said. "What you and I can see from revenues is what people spent. But what we can't see is what they have in their bank accounts." | Consumer & Retail |
The beginning of this year saw a big change to the federal tax incentives applied to electric vehicles, altering which cars were eligible. And from next year, another change is coming, one that we think is long overdue. From January 1, 2024, you'll be able to have the amount of the credit applied immediately to the car's price at purchase rather than waiting until tax time.
The original IRS section 30D tax credit, meant to spur the adoption of plug-in vehicles, was tied to the storage capacity of a car's battery pack. But from this year, the $7,500 credit is now linked to domestic battery manufacturing rather than just battery capacity, with annually escalating percentages of the battery required to come from the US or a country with a free trade agreement in order to qualify.
The changes to the credit—which were made under 2022's Inflation Reduction Act—also address several problems with the old scheme. A $4,000 credit (IRS section 25E) was created for buyers of used EVs, and there are now income and price caps to address criticisms that the credit merely subsidized those wealthy enough not to need it.
Another problem has been that, since it's a tax credit, one had to wait until filing that year's taxes to claim it. Not a problem if you bought an EV at the end of the year, but it's perhaps less convenient if the purchase was in February, for example.
But from the start of next year, the credit for either a new or used EV becomes transferable from the buyer to the car dealer on the condition that the full amount of the credit is applied to the purchase price of that vehicle. So, if you were buying a $25,000 used Mini Cooper SE (as an example), you could transfer the full $4,000 to the dealer and only have to pay the remaining $21,000.
The dealer electronically submits info to the IRS about the sale at the time of purchase, and it should receive the money from the IRS within three days.
This only applies to cars bought from car dealers registered with the IRS and not private sales, and there are some other conditions. If you return a new vehicle within 30 days of delivery, you can't claim the credit, and if a used EV to which the credit has been applied is returned, it is no longer eligible for further credits. Buyers can't claim the credit if they resell the new or used EV within 30 days of purchasing it, all of which should prevent abuse of the system.
These tweaks to the tax credit have been greeted warmly by clean-vehicle advocates. "This guidance makes it easy for everyone to access the IRA's new and used electric vehicle tax credits at the point of sale. A simplified process will maximize the benefit of these credits, not just to drivers and their communities, but to the entire EV supply chain," said Albert Gore, executive director of the Zero Emission Transportation Association. | Inflation |
Shiv Nadar Most Generous Indian For Second Year In A Row: Report
IT major HCLTech Ltd.'s Shiv Nadar has retained his position as the 'most generous Indian' in 2023 as well, with a 76% jump in his donations at Rs 2,042 crore.
IT major HCLTech Ltd.'s Shiv Nadar has retained his position as the 'most generous Indian' in 2023 as well, with a 76% jump in his donations at Rs 2,042 crore.
Wipro Ltd.'s Azim Premji's donations zoomed by 267% to Rs 1,774 crore during the same year, according to the Edelgive Hurun India Philanthropy List 2023 released on Thursday.
Richest Indian Mukesh Ambani donated Rs 376 crore in the year, which is an 8% decline. The Reliance Industries Ltd. chairman and managing director, who witnessed a 2% rise in fortune to Rs 8.08 lakh crore, continued to be the third most generous on the list.
Second richest Indian Gautam Adani climbed two spots to be the fifth generous Indian on the list, with a 50% rise in donations to Rs 285 crore.
Adani's wealth was pegged at Rs 4.74 lakh crore in a recent report by Hurun.
As per the Hurun report published in October, Nadar's wealth was pegged at Rs 2.28 lakh crore and the software industry honcho was the fourth richest Indian. Wipro's Premji was ranked 58th with a fortune of Rs 30,000 crore.
Kumar Mangalam Birla of the Aditya Birla Group retained his position as the fourth most generous Indian with donations of Rs 287 crore.
Some individuals and families made big strides to break into the top-10 in the list of givers, including the Bajaj family, along with Cyrus S Poonawalla and Adar Poonawalla, and Rohini Nilekani, as per the report.
"As wealth expands, family philanthropy is gaining prominence, evolving from ad-hoc acts of providing essentials like food, clothes, and scholarships to focusing on new and marginalized areas," Hurun India's chief researcher and managing director Anas Rahman Junaid said.
The primary goal of the list is to acknowledge the charitable endeavours, ensuring their influence reaches every stratum of society, he added.
Nilekani was the most generous woman, and others including Thermax's Anu Aga and Leena Gandhi Tewari also featured on the list of givers.
Discount brokerage firm Zerodha's 37-year-old co-founder Nikhil Kamath was the youngest in the list, which pegged the overall donation by the Kamath brothers at Rs 110 crore.
Larsen and Toubro Ltd.'s AM Naik was the biggest giver among professionals with a donation of Rs 150 crore, which earned him the 11th place in the overall list of givers.
There were 4 individuals who made an annual donation of Rs 100 crore and above, and the list has a total of 119 individuals and families. | Nonprofit, Charities, & Fundraising |
Wilko will return to the High Street, with the brand's new owner opening up to five shops before Christmas.
The owner of the Range, which also bought Wilko's website after its collapse, will launch the first two Wilko shops in Plymouth and Exeter.
Its boss said that "it's clear that there's a huge love for Wilko".
Wilko collapsed in early August, leading to thousands of job losses and the closure of its 408 stores, many of them in traditional town centres.
CDS Superstores, which owns The Range, said former Wilko staff would be given priority in the recruitment process for the new shops.
Its chief executive Alex Simpkin said: "The public reaction to the loss of Wilko stores was undeniable.
"That's why we've taken the decision to reintroduce Wilko back to many of the High Streets and communities that it used to so proudly serve."
While these High Street locations are convenient for shoppers without cars, since the pandemic there's been a shift to bigger retail parks and out-of-town options with more space.
This as well as Wilko's struggle to keep up with competition from other discount retailers, including The Range, B&M and Poundland was blamed for its collapse.
CDS Superstores is aiming to opening up to five Wilko shops before Christmas, with two leases signed already for High Street locations in Devon.
They will be "concept" stores, followed by two locations in the South-East of England and one in the North of England, which are expected to be announced soon.
For the first time, it is also planning to open Wilko-branded shops in Northern Ireland.
Wilko was founded in 1930 when JK Wilkinson opened his first store in Leicester. It expanded across the Midlands initially and by the 1990s became one of Britain's fastest-growing retailers.
But after the firm collapsed into administration, other competitors like B&M and Poundland snapped up dozens of shops to operate under their own names.
A mixture of former Wilko sites and new ones are being considered for the new shops launched by CDS Superstores, with negotiations currently going on with landlords.
All of the five shops it is hoping to open before Christmas are expected to be quite different - some single-level, other split-level and an out-of-town retail park reportedly on the cards. They will not be "pop-up" stores, but a permanent fixture.
CDS said the new shops will offer Wilko products from cleaning and households ranges, to DIY and household goods.
In a statement on Friday, the firm said that the roll-out will carry on through next year, and it is understood that it is hoping to open as many as 200 shops within the next couple of years.
Richard Lim, chief executive of Retail Economics, suggested that the new shops would be able to benefit from the scale and systems that The Range has in place.
"This is a fascinating development and unlikely to have been part of the original plan when it was acquired," he said.
But he suggested that the move would be "no easy feat", with many High Streets struggling with dwindling numbers of shoppers out and about.
"Many profitable store locations have already been snapped up by competitors and a successful roll-out of this scale at speed will be dependent on the selection of great locations that offer sustainable levels of footfall," he said.
In the new stores, customers will also be able to look through the full Wilko range and order products for home delivery on new terminals.
The Range also plans to sell Wilko products across its own 200 shops.
Lots of Wilko's stock in its shops consisted of its own-brand products when it was operating, with shoppers lamenting the loss of its pick and mix sweets and household goods on offer earlier in the year. | United Kingdom Business & Economics |
Uber and Lyft will pay a combined $328 million to settle claims by New York's attorney general that the ride-sharing companies systematically cheated drivers out of pay and benefits.
Attorney General Letitia James said Uber will pay $290 million and Lyft will pay $38 million to resolve her office's multi-year investigation.
Drivers will also be guaranteed minimum hourly rates and paid sick leave, and be given notices and in-app chat support to address their questions about earnings and other working conditions.
More than 100,000 current and former drivers in the state stand to receive settlement funds and related benefits.
"This settlement will ensure they finally get what they have rightfully earned and are owed under the law," James said in a statement.
She called the accord with the San Francisco-based companies the largest wage theft settlement in her office's history.
Uber and Lyft have long defended against claims nationwide that they shortchange drivers, many of whom are immigrants, out of pay and benefits, sometimes by classifying them as independent contractors instead of employees.
James accused Uber and Lyft of improperly deducting sales taxes and fees for a workers compensation fund from drivers' payments, though passengers should have paid those amounts.
Uber's alleged violations occurred from 2014 to 2017, and Lyft's from 2015 to 2017.
James said both companies also denied drivers sick leave that state and New York City employees are legally entitled to receive.
The probe arose from concerns from the New York Taxi Workers Alliance, which says it represents about 21,000 yellow taxi, green cab, app-based, livery and corporate car drivers.
Under the settlement, drivers outside New York City will receive a minimum $26 per hour for rides and sick leave, adjusted annually for inflation.
Drivers in New York City already receive minimum pay and some paid time off, as required by the city's Taxi and Limousine Commission. James said Uber and Lyft drivers there will receive $17 per hour for sick leave, with inflation adjustments. | Workforce / Labor |
By Jack Kim
SEOUL (Reuters) -South Korea from Monday will re-impose a ban on short-selling shares at least until June to promote a "level playing field" for retail and institutional investors, financial authorities said on Sunday.
The ban was lifted in May 2021 for trades involving the shares of companies with large market capitalisation included in the KOSPI200 and KOSDAQ150 share price indices. The restriction has remained in place for most other stocks.
Short-selling involves selling borrowed shares to buy back at a lower price and pocket the difference.
"The measure is aimed at fundamentally easing 'the tilted playing field' between institutional and retail investors," Financial Services Commission (FSC) Chairman Kim Joo-hyun told a news briefing.
"Amid continued uncertainty in financial markets, major foreign investment banks have been engaged as a matter of practice in unfair trades ... and we determined that it would be impossible to maintain fair trading discipline," Kim said.
The FSC will review market activity in June to decide whether there is significant improvement to allow the ban to be lifted, he said.
The regulator last week said it would establish a team of investigators to probe short-selling by foreign investment banks for illegal activity including so-called naked short-selling.
Naked short-selling - in which an investor short-sells shares without first borrowing them or determining they can be borrowed - is banned in South Korea.
The Financial Supervisory Service in October said it would likely fine two Hong Kong-based investment banks it determined had engaged in naked short-selling transactions worth 40 billion won ($29.58 million) and 16 billion won respectively.
Earlier in the year, the regulator fined five foreign firms including Credit Suisse for naked short-selling.
Officials and market watchers alike have cited uncertainty around short-selling regulation as among factors needing to be resolved for influential index provider MSCI to upgrade South Korea to developed-market status.
(Reporting by Jack Kim; Editing by Michael Perry and Christopher Cushing) | Stocks Trading & Speculation |
NEW YORK -- The founder and former CEO of the failed cryptocurrency lending platform Celsius Network was arrested Thursday on federal fraud charges alleging that he schemed to defraud customers by misleading them about key aspects of the business.
Alexander Mashinsky is charged with securities, commodities and wire fraud in an indictment unsealed in Manhattan federal court. He is also charged with illegally manipulating the price of Celsius’s proprietary crypto token while secretly selling his own tokens at inflated prices.
Mashinsky’s attorney did not immediately respond to a message seeking comment.
According to the indictment, Mashinsky from 2018 to 2022 pitched Celsius to customers as a modern-day bank where they could safely deposit crypto assets and earn interest. But it says Mashinsky operated Celsius like a risky investment fund, taking in customer money under false and misleading pretenses and exposing customers to a high-risk business.
The indictment alleges that Mashinsky promoted Celsius through media interviews, his Twitter account and Celsius's website, along with a weekly “Ask Mashinsky Anything” session broadcast posted to Celsius's website and YouTube channel.
Celsius employees from multiple departments who noticed false and misleading statements in the sessions warned Mashinsky, but they were ignored, the indictment states.
Mashinsky's false portrayal of Celsius as a safe and secure institution caused its customer base to grow exponentially through a large number of retail investors, the indictment says.
By the fall of 2021, Celsius had become one of the largest crypto platforms in the world, purportedly holding approximately $25 billion in assets, it says.
The Securities and Exchange Commission on Thursday also sued Mashinsky and Celsius, saying they misled investors through unregistered and often fraudulent offers and sales of crypto asset securities.
In January, New York Attorney General Letitia James sued Mashinsky in state court in Manhattan, saying he misled hundreds of thousands of investors.
Celsius filed for bankruptcy last year. | Crypto Trading & Speculation |
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Labour has hinted that Keir Starmer could still repeal the controversial two child benefit cap if elected Prime Minister next year – despite insisting at the weekend that he would not scrap it.
Asked by the BBC on Sunday whether he would scrap the cap, Starmer told Laura Kuenssberg that his party was “not changing that policy”.
However, following a wave of criticism from Labour MPs, his spokesman signalled on Wednesday that it was still possible that a Starmer Government could at some point pledge to remove the cap.
The spokesman told journalists that while the party had to make “difficult choices” on spending, the Labour leader’s previous opposition to the cap “hasn’t changed throughout the period”.
The spokesman said that while Starmer would not make “unfunded spending commitments on welfare or anything else” he would “set out fully-costed plans closer to the election”.
Pressed on whether Labour could still repeal the legislation, despite Sir Keir’s apparent vow not to on Sunday, he added that: “We’re not going to speculate on hypotheticals. The fact of the matter is we have set out precisely the measures that we are going to change when it comes to tax and public spending already… I’m not going to engage in sort of hypothetical conversations or what else might or might not happen”.
Members of Starmer’s Shadow Cabinet have previously described the benefit limit as “heinous”, and one which “keeps children in poverty”.
Starmer himself has also previously called for the “inhumane” cap to be scrapped.
And on Tuesday, the Scottish National Party was among opposition parties to slam Labour for their “u-turn” on abolishing the two-child benefit cap – pointing to numerous senior Labour figures condemning the policy in recent years.
The two child benefit limit prevents parents from claiming child tax credit or universal credit for child beyond their second if they were born after April 2017. The policy was introduced by former chancellor George Osborne under his austerity push – and has been condemned by charities for pushing parents further into poverty.
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It was branded by some as a “rape clause” as it provides no exceptions, e.g. providing child benefit for children born of sexual assault.
Labour frontbencher Wes Streeting has previously cited the need to “restore a social security system worthy of the name” including by “ending the two-child limit in universal credit to restore support to 250,000 children”.
And another frontbencher, shadow work and pensions secretary Jonathan Ashworth, has previously said: “We are very, very aware that this [two-child benefit cap] is one of the single most heinous elements of the system which is pushing children and families into poverty today”.
Scrapping the two child benefit limit could cost around £1.3bn a year according to some estimates, though others put it closer to £3bn.
Knee-Capped
Sir Keir was lambasted over his refusal to commit to scrapping the cap during Prime Minister’s Questions on Wednesday. The SNP’s Westminster leader Stephen Flynn asked the PM: “Does he take comfort in knowing that the heinous legacy of that policy will no longer just be protected by Conservative members, but by Labour members too?’”
However, Sir Keir’s spokesman insisted that the party needed to make “difficult choices” on spending, due to the damage the Conservatives have “incurred to public finances”.
“We know we’re going to have an incredibly tight financial situation. Which means that you know, we have to be absolutely laser like focused on the need to be responsible with the public finances”, he said.
Sunak also welcomed Keir’s apparent “support” for keeping the cap – in a move that is likely to rile Labour members.
Who is Making Policy?
The chair of the soft-left group Open Labour, Tessa Milligan, told a meeting of nearly 200 Compass supporters on Tuesday that it was deeply unclear who is making policy in the party at present. Compass recently saw its director Neal Lawson threatened with expulsion over backing cross-party cooperation in 2021.
“There are key elements of policy-making in the party at the moment that are very opaque, making it difficult to engage with them. There are factions in the Labour Party who are very unclear about their own policies….
“There may be groups within the Labour Party who want to stop the two-child benefit limit. I would encourage them to come out of the shadows and argue for it publicly. I think they will not find a majority of support for that position if indeed there are groups within the party that hold that position.
“What you’ve seen with the two-child benefits cap is what seems to be a manifesto by ambush,” Milligan said.
Milligan said policy seems to be being “decided somewhere and I don’t know who decides it.”
On the two-child limit policy, she added: “I don’t know what the evidence base for it is, and it’s suddenly announced at nine o’clock on national television. Whether you agree with the policy is irrelevant when it comes to effective governance.
“When you strip it down to that, you end up with a Shadow Cabinet, parliamentary Labour Party, and a series of activists who have no idea why this is our policy. What the evidence base for it is or even what the messaging is for it, if they do want to try and persuade the public that it’s a good idea.”
Do you have a story that needs highlighting? Get in touch by emailing [email protected] | United Kingdom Business & Economics |
Something strange is happening in the heart of London, something an entire generation has never witnessed. You see it by piecing together the news ignored as too small by the big media and reported only by the local journalists covering their particular boroughs. So try these snippets.
Last week, Lambeth announced that a secondary school founded in 1685 will close for good this summer, with its students farmed out elsewhere. In Camden, St Michael’s primary will not even make the end of the school year – it closes this month, the fourth in the borough to go since 2019. Days before the Easter holiday, Hackney warned that two of its primaries are likely to fold and another four may have to merge to survive. Neighbouring Islington is considering closures, while Southwark believes 16 primaries are at risk.
This is a huge story, not only about marooned children and panicked parents, or redundant teachers and struggling councils, but the very future of our major cities. These schools are not shutting because they are bad, but because inner London no longer has enough children to fill them. The dead centre of Britain’s political and economic powerhouse is driving out families – and its education system is now taking an almighty hit. Hackney, for instance, has 589 fewer kids in reception today than it did in 2014, a shortfall equivalent to about 20 vacant classrooms. Since schools mainly receive cash per pupil, empty desks mean debts, and debts force closures.
Once a primary or secondary school locks its gates, it’s gone for good. That handsome redbrick shell is gavelled off, to be reincarnated as splendid flats for sub-nuclear households, and the only reminder of a proud state institution is the service charge on that private finance initiative wing – which will be levied long, long after you and I have ascended to the great common room in the sky.
A city without children is not some dystopia; it is the new reality. At the Centre for London, senior researcher Jon Tabbush has analysed 20 years of census results, and found families with kids have gone missing across the centre of London. Since 2001, Lambeth has seen a 10% drop in households with at least one school-age child; in Southwark it’s 11%. Hackney, Tower Hamlets, Islington: they are all losing young families.
As Camden council’s leader Georgia Gould says: “People are either being pushed out before they can have babies – or they’re choosing to leave.” This goes way beyond the rite of passage of couples swapping their city-centre flats for a suburban home and garden, she says – it is now happening at speed and scale beyond anything her officials imagined. In outer London Barking and Dagenham, there has been a 34% increase in households with children: the kind of jump any local authority would struggle to handle. A similar story can be told all around the perimeter of the city: its children and its future are being formed on its outskirts.
If this historic shift has a hinge point, it’s the 2010s, when two big forces began reshaping the capital. The first came from Downing Street: since David Cameron moved into No 10, successive Tory governments have taken benefit money from the very youngest and handed it to the oldest. The Resolution Foundation calculates that newborns have lost £1,500 a year in entitlements, while those aged 80 and above have gained more than £500.
By holding down housing benefit so it lagged far behind London rents, the supposedly centrist coalition of Cameron and Nick Clegg forced less well-off families out of the capital. They made inner London into a no-go area for the working poor, and Britain into a country that steals from its future for the sake of buying a few extra votes at the next election.
The post-crash decade also saw inner London turned into a theme park for property speculators. The Bank of England was spraying about hundreds of billions of pounds like it was champagne at a grand prix, the then chancellor George Osborne was chucking taxpayer’s money at the property market, and London councils, including some of Gould’s Labour colleagues in Camden, were allowing developers to run riot. The arguments about gentrification soon descended into cliches about hipsters and Foxtons, when what was really being decided was who would live in the city and who it would serve.
Children are what Kathy Evans of the charity Children England calls “an indicator species”: as long as a city or town has a good and large mix of kids, you know it will be fine. In which case, the signs from London’s indicator species should worry us all.
Camden’s records show that just under 40% of its teenage children attend private school – about five times the national average. A roughly equal proportion of local kids grow up in poverty. So stark is the divide that some families are running a campaign to implore “aspirational parents” to at least consider local state options. The founder of Meet the Parents, Madeleine Holt, talks of “a fear of what state schools are really like” among the bankers and lawyers who now live in the borough. A fear, in other words, of their own neighbours – the ones who can’t drop £20,000 a year on school fees.
The families going missing are those who can no longer afford to buy or rent. Parents such as Louise Ellery, who rents from the Peabody housing association, a charity set up to provide shelter for the “artisans and labouring poor”. Yet she has seen her rent go up and up, along with her other bills. On her phone, she shows me the bank statement: £1,400 a month for her two-bed flat, which many London renters might consider a bargain. But her salary as a school teaching assistant nudges just over £1,600. For the rest of the month she has to feed, heat and clothe her two kids on that wage, a little bit of benefits and the occasional helping hand from a relative.
For two years, Ellery has tried to make these impossible sums work, while her elder child studied for A-levels. The 47-year-old has lived in Camden for decades, has helped run the school food bank and a toy library, and kept an allotment. She loves the fact her neighbours come from all over the world and that London’s free museums and galleries are on the children’s doorstep. But, “I can’t beat the cost of living”, she says. This summer she is moving to Somerset.
Her local primary school, Netley, loses one of its most experienced teaching assistants and her six-year-old daughter. Her headteacher, Gareth Morris, emails from his holiday to say he is “devastated” she is going. But he knows the score. Two in three of his children are on free school meals, and in lockdown he went around handing out food packages. Yet from the school gates he sees tourists trundling past with wheeled suitcases for their Airbnbs, and all along the neighbouring terrace houses the lockboxes for holiday lets.
Ellery has seen it, too, and the new shiny private tower blocks, and knows what all that means for her, her career and her kids. At the school, children have written notes to thank her for everything; on her estate neighbours have cried. “What’s it called when you push out low-income people?” she asks rhetorically. The tone is not anger but resignation. She has lost her fight to stay and London has lost another family.
Aditya Chakrabortty is a Guardian columnist and senior economics commentator | United Kingdom Business & Economics |
"I never used to go out, I never used to make friends," says Penny Phillips, a 52-year-old mother-of-two who was out of work for three decades.
She lives in the Clacton area of Essex, which has the highest proportion of people classed as "economically inactive" in the UK.
While being unemployed means people are looking for work, "economically inactive" refers to those who are neither employed nor seeking work - whether through long-term illness, retirement or for other reasons.
Research for the Clacton Place programme shows half all people over 16 in the town are economically inactive and one in five have never had a job of any kind.
The latest government labour data also reveals economic inactivity in Clacton at 46.8% - more than twice the 21.7% UK average.
Growing up, Ms Phillips says her parents believed she had "problems", but hearing and other tests revealed nothing.
She has recently been diagnosed as having autism and, after taking a short course in retail, has started her first job.
It is seasonal work and involves cleaning caravans in the nearby village of Weeley. When she is not doing that, she volunteers at the Sense charity shop on Clacton High Street.
Describing the moment she got her first wage packet, Ms Phillips' face lights up.
"I felt like I wanted to run away with it, just to enjoy all the money," she says.
"I wanted to get out and do a job. Since I have come to the caravans, I've [found] my own voice and I don't feel nervous any more."
People like Penny are "untapped resource", according Mike Keen, operations manager for Essex for the Department for Work and Pensions (DWP).
He says a significant number of economically inactive people are claiming benefits but "are not actually looking for work or feel like they are capable of work".
But why is there such a high proportion of economically inactive people in Clacton particularly?
"I think most seaside towns are the same," he says.
Seasonal work patterns, a shortage of big employers and being at the far end of the transport network all play a part, Mr Keen says.
Giving people the right tools to get back into the workplace, he adds, is vital.
"We are working with employers and people with both physical and mental disabilities. We are not saying they will be ready for work instantly - it may be we move them closer to work through training courses and then supporting them when they are in work.
"We will support them all the way through and make sure they've got everything they need."
One effort to try and encourage people back into work is a monthly community bus, organised by Kerrey Goosetree from the North East Essex Clinical Commissioning Group, which visits locations in Clacton and the surrounding areas.
Representatives from volunteering organisations, education institutions, health services, the DWP and others set out their stalls waiting to share their expertise and advice to interested passers-by.
She says many people they meet have misconceptions.
"For example, people might come along and say they would like to start working again but are not sure how they will survive if their benefits are stopped straight away. Having the DWP here means that misconception can be dealt with right away.
"Some people might not have the right qualifications they need. We've got training providers here.
"I think sometimes people also assume that there are not many opportunities here in Tendring. There really are."
Being in work also improves people's long-term health, she says.
"People who are in work are able to afford better food, better housing and so on, and that has an effect on their health outcomes."
Many of the people the bus sees, she says, are lacking in confidence.
For some, the best first step can be to carry out volunteering work as a precursor to paid employment.
Lisa Andrews, deputy chief officer at Community Voluntary Services Tendring, says volunteering offers huge benefits to those wanting to return to work, but might not yet be ready.
"It supports them in so many ways," she says. "First, just going through the process of filling in a form and having a chat with somebody, then there's opportunity to put something exciting on their CV and thirdly you can put a reference down, an employer, who can say you turned up on time every day, you were reliable and trustworthy - it does so much for people.
"Finally, there's what volunteering does for people's confidence - it is phenomenal."
Those involved in developing Tendring's economy have high hopes that the offshore energy industry will bring thousands of new jobs to the area.
Ivan Henderson, Tendring Council's cabinet member responsible for economic development, says: "There are a lot of jobs that are going to be coming on board for young people to actually take advantage of.
"We need to make sure we work with our education partners to make sure people are geared up and have the skills and qualifications to meet those challenges.
"Levelling-up is just a word - what we need to do is make it a reality." | United Kingdom Business & Economics |
Rishi Sunak is considering introducing some of the world’s toughest anti-smoking measures that would in effect ban the next generation from ever being able to buy cigarettes, the Guardian has learned.
Whitehall sources said the prime minister was looking at measures similar to those brought in by New Zealand last December. They involved steadily increasing the legal smoking age so tobacco could not be sold to anyone born on or after 1 January 2009.
It is understood Sunak’s leadership pledge to fine people £10 for missing a GP or hospital appointment may also be back on the table, although this could be politically difficult. The idea was announced by the prime minister during his campaign in summer 2022, but appeared to have been dropped when he took office last autumn.
A New Zealand-style anti-smoking policy would mean cigarettes were phased out completely for the next generation. Under the former prime minister Jacinda Ardern, New Zealand also legislated to reduce the nicotine content of tobacco products and force them to be sold only through specialty tobacco stores, rather than convenience stores and supermarkets.
Labour has previously said it was consulting on phasing out cigarette sales over time for younger people in a similar way to New Zealand, with the shadow health secretary, Wes Streeting, saying in January he wanted to find out whether there was an “appetite for change” in the country.
The policies under consideration are part of a new consumer-focused drive from Sunak’s team before next year’s election. This week the prime minister was widely criticised by business, centrist Tories and environmental groups for rowing back on his own party’s net zero targets.
He was also accused of sowing uncertainty in education after it emerged he was considering an overhaul of A-levels to move to a system more similar to the international baccalaureate, which allows students to study more subjects.
In relation to Sunak’s net zero rowback and confusion over his education policies, Keir Starmer, the Labour leader, said the government was creating instability in the country that was exacerbating an “economic bin-fire” under the Tories.
“At a time when people and businesses are crying out for stability, Rishi Sunak has poured fuel on the Tories’ economic bin-fire in a desperate bid to keep Liz Truss and her fellow arsonists happy,” he told the Guardian.
“Britain has a once in a generation chance to reverse 13 years of decline and get ahead – to bring down people’s bills, create quality jobs and free us from the grip of Putin and over-reliance on China. Rishi Sunak’s weakness now stands between the country and proper national renewal.”
Sunak is also under pressure over the HS2 high-speed rail line, with talks being held over whether to cut the Birmingham to Manchester arm of the project in a move that would infuriate northern Tories and further risk seats won under Boris Johnson in 2019.
The prime minister is understood to be considering whether some infrastructure spending needs to be “reprioritised”, and cancelling the northern leg would potentially free up billions for the chancellor to use for pre-election tax cuts. The chancellor, Jeremy Hunt, said this week that the costs of HS2 were “totally out of control”.
No 10 and the Treasury are also considering policies on law and order, and the possibility of holding down further benefit rises – both of which they hope Labour might oppose in order to have clearer dividing lines at the election.
Downing Street insiders suggest Sunak has decided to pursue the policies that most matter to him under a “let Rishi be Rishi” approach. However, the shift in the net zero agenda, drawn up under the guidance of the electoral strategist Isaac Levido, as well as the search for dividing lines in the areas of welfare and crime, suggest the policy changes are also highly political.
Sunak’s autumn reset is likely to continue during conference season and the king’s speech in November, with the party casting round for policies that could reverse its weakness in the polls.
A YouGov poll found on Friday that the prime minister’s net favourability rating fell to -45, his lowest score to date, after the net zero changes were announced. It found 68% of Britons have an unfavourable view of the prime minister.
Separately, polling from Ipsos found the public were split over Sunak’s policy of a delay to net zero targets. It found that, of those who knew something about the policy, 47% felt the government was right, and 46% that it was wrong. About 71% of 2019 Conservative voters who were polled and aware of the announcement said it was the right decision, compared with 24% of 2019 Labour voters.
Asked about the policy of a New Zealand style-smoking ban, a government spokesperson said: “Smoking is a deadly habit – it kills tens of thousands of people each year and places a huge burden on the NHS and the economy.
“We want to encourage more people to quit and meet our ambition to be smoke-free by 2030, which is why we have already taken steps to reduce smoking rates. This includes providing 1 million smokers in England with free vape kits via our world-first ‘swap to stop’ scheme, launching a voucher scheme to incentivise pregnant women to quit, and consulting on mandatory cigarette pack inserts.” | United Kingdom Business & Economics |
Sir Keir Starmer is facing a revolt from Labour MPs in London over the expansion of the Ulez scheme.
MPs and a candidate in constituencies that will be hit by the charge for the first time next month said the expansion should be delayed and reworked to avoid exacerbating the cost of living crisis.
Danny Beales, the Labour candidate in Uxbridge and South Ruislip in the by-election caused by Boris Johnson’s resignation, pledged to put his “community first” and oppose the expansion.
Three other Labour MPs in outer London constituencies backed Mr Beales’ calls for Ulez to be delayed unless a more generous scrappage scheme was introduced to help motorists with the cost of greener vehicles.
The Uxbridge candidate said that after an “evolution of his position” he would “fight” Sadiq Khan, who is in charge of the Ulez project, and called on the Labour leader to do the same.
He said voters had told him “heart-wrenching” stories about the cost of the scheme and warned that it was not “socially just”.
Under Mr Khan’s plans, Ulez will charge around 10 per cent of drivers £12.50 per day to use their cars inside the M25. Despite opposition to the scheme, Sir Keir has backed the expansion, describing it as a “difficult decision that had to be made”.
Asked what he would say to his party leader on the issue, Mr Beales told The Telegraph: “I’d say I’m a representative of this community, and it’s community first for me, party second.
“Whether it’s challenging the council, challenging City Hall or challenging the Government, that’s what I’ll do as a candidate and I’ll do as a local MP, and I think that’s what people want.”
He said voters in Uxbridge and South Ruislip had convinced him that the scheme would add pressure to their household finances.
“What I hear from people themselves is of course we want clean air, we all do,” he added. “But we have to do it in a socially just way, and at the moment the scrappage scheme just isn’t good enough.”
The comments put him on a collision course with the party’s leadership, although sources close to Sir Keir insisted he was open to the thoughts of London MPs on the cost of the plans for motorists.
Other MPs warned that Mr Khan’s Ulez expansion would hit consumers.
Siobhan McDonagh, the MP for Mitcham and Morden, said: “Whilst I absolutely share the environmental concerns that underpin the proposals and I am very concerned about the need to help improve air quality across London, I personally do not believe that making driving unaffordable for some of the most vulnerable people in our capital is the best or fairest way to address these issues.”
Clive Efford, the Eltham MP, said: “I absolutely agree with the principle behind what Sadiq is seeking to achieve. I would rather it was postponed because of the cost of living crisis, because I understand the hardships that many people will be facing.”
Jon Cruddas, MP for Dagenham and Rainham, said: “For the last couple of years I’ve been concerned about this in terms of being introduced at a time of a cost of living crisis and argued that it should be delayed.”
Mr Khan argues that a low emissions zone is the only way to increase air quality in the capital, by using cameras to track drivers’ journeys in non-compliant cars. The policy is being challenged by five Conservative-run councils in the High Court. | Inflation |
Surging prices for soft commodities, from orange juice to live cattle, are complicating the inflation picture.
A host of agricultural commodities have climbed in recent months, driven by weather-related damage and rising climate risks around the globe, resulting in tighter supplies. The higher prices add another layer of pain to consumers' wallets at a time when stubborn core inflation, excluding food and energy, stood at 4.3% in August.
Futures contracts on orange juice, live cattle, raw sugar and cocoa each hit their highs for the year this month. All are in "supply-driven bull markets right now," said Paul Caruso, director of commodity investments at Ancora.
The S&P GSCI Softs index, a sub-index of the S&P GSCI commodities index that measures only soft commodities, has jumped almost 19% so far this year.
Orange juice has shot up due to a short global citrus supply and hurricanes last fall that hit Florida, the primary producer of orange juice for the U.S. Major exporters, including Brazil and Mexico, also lowered their estimated orange crop yields for the year due to warmer temperatures making harvests more difficult.
Meat prices have been driven by shrinking U.S. cattle herds, continued beef demand, plus higher input costs for labor and fuel. A prolonged drought in the Midwest earlier this year damaged grasslands and hay crops, forcing some farmers to cull their herds. Data from the U.S. Department of Agriculture forecasts declining supplies this year and next, and potentially through 2025 and 2026, before supplies are rebuilt.
It's not just breakfast or lunch that has gotten more expensive — so has dessert.
Raw sugar and cocoa prices have soared in recent months. Sugar futures reached 27.62 cents per pound last week, the highest since 2012, while cocoa futures soared to $3,763 per metric ton this month, also the highest level in more than a decade.
Prices for sugar spiked earlier this year as rising demand combined with downward crop revisions from key producing countries, such as India and Thailand, resulting from extreme weather. India, for example, is the world's second largest sugar producer after Brazil.
"Soft commodities in particular are very fragile and very sensitive to weather change," which can disrupt production, said Darwei Kung, head of commodities and natural resources at DWS. "That's why we're seeing the price go up, and there's no short term solution because there's only so much people can produce. And that's not sensitive to demand as much as it is to the production side."
Given that food and energy are not included in calculations of core inflation, Kung added that consumers may experience higher daily prices than are taken into account by central bank policymakers. That could create a "bifurcation" of perspectives around inflation that's tougher on consumers, at least in the short-term, he said.
Shoppers are bearing the brunt of the higher prices as the world's largest food companies try and pass along their rising input costs.
"It's certainly not the time to talk about deflation [or] price decreases because of the significant decrease that we have seen in gross margin…We still see a high level of input cost inflation," Nestlé's chief financial officer François-Xavier Roger said at Barclays Consumer Staples Conference earlier this month.
The Nestlé executive noted increased costs for sugar, cocoa and Robusta beans for coffee, adding that, "obviously, some other items have declined like energy, like transportation, but net-net, still a few billions up in terms of input cost inflation in 2023."
Unilever's chief financial officer Grame David Pitkethly similarly noted at the Barclays conference that the company — maker of Ben & Jerry's, Magnum and Breyers ice cream — is still seeing inflation in its nutrition and ice cream categories. In late July, Unilever reported a 12.6% rise in "underlying prices" within nutrition and 11.5% within ice cream, the latter being Unilever's most discretionary category where "private label is attractive to the consumer," Pitkethly said.
"We've got lots and lots of inflation and pricing…the consumer feels that pricing," the CFO said.
To be sure, prices of other agricultural commodities, such as corn and wheat, have fallen from their highs earlier this year, brightening the outlook for consumers.
Benchmark soybean futures fell to a one-month low last week after the USDA reported weaker-than-expected soy export sales. Corn and wheat hit their year-to-date highs in January and February, and have fallen since.
Some analysts are counting on higher interest rates and slower economic to curb consumer appetites.
"I think that volatility persists as we understand what the harvest is, but as important as the harvest is, it's all about understanding the demand," said Jeff Kilburg, founder and CEO of KKM Financial.
If demand suffers, it might even foreshadow a pullback in stocks, Kilburg said. | Agriculture |
IREDA IPO Subscription Day Three: Live Updates
The IPO has been subscribed 5.31 times as of 10:24 a.m. on Thursday.
The initial public offering of Indian Renewable Energy Development Agency Ltd. opened for public subscription on Tuesday. It was subscribed 4.56 times on day 2.
The offer—first government IPO in 18 months—will continue till Thursday.
The government is looking to raise Rs 2,150 crore through the primary share sale, which is a mix of fresh issue and an offer-for-sale portion. The Union government, which is a promoter in the firm, will offload 2.69 crore shares, reducing its stake will decline to 75% from 100%.
Issue Details
Issue opens: Nov. 21.
Issue closes: Nov. 23.
Total offer size: Rs 2,150 crore.
Fresh issue size: Rs 1,290 crore.
Offer for sale size: Rs 860 crore.
Face value: Rs 10 apiece.
Fixed price band: Rs 30–32 per share.
Lot size: 460 shares.
Listing: NSE, BSE.
Shareholding Pattern
The pre-IPO shareholding stands at 2,28,46,00,000 and will increase to 2,68,77,706 after the initial public offering.
Promoters selling shareholders will be taking part in the offer for sale. The President of India, acting through the Ministry of New and Renewable Energy, Government of India, will be offloading a total of 2.69 crore shares.
Post-IPO, the promoter and public group shareholding to public shareholding ratio will stand at 75:25, from 100% with the promoter and public group category previously.
Business
Incorporated in 1987, Indian Renewable Energy Development Agency Limited is a public limited government company. It is a Mini Ratna (Category - I) government enterprise and is administratively controlled by the Ministry of New and Renewable Energy.
The company operates in four key sectors: solar, wind, hydro, biomass, biofuels and cogeneration.
IREDA is a non-banking financial institution that promotes, develops and extends financial assistance for new and renewable projects. With 36 years of experience under their belt, the company provides a comprehensive range of financial products and related services, from project conceptualization to post - commissioning, for renewable energy projects and other value chain activities, such as equipment manufacturing and transmission.
Use of Proceeds
The offer includes a fresh issue and an offer for sale. The company will not receive any proceeds from the offer for sale part of the issues, and all proceeds from the OFS will be received by the promoter selling shareholder.
The company intends to utilise the net proceeds from the fresh issue for the following purposes:
To augment the company's capital base to meet future capital requirements and onward lending.
Subscription Status: Day3
The IPO has been subscribed 5.31 times as of 10:24 a.m. on Thursday.
Institutional investors: 2.70 times
Non-institutional investors: 9.91 times
Retail investors: 4.97 times
Employees reserved: 5.61 times | Renewable Energy |
Keir Starmer has said he would not support subsidising mortgage holders to spare them the pain of rising interest rates, as the Bank of England pushed its base rate up by 0.5 percentage points to 5%.
The Labour leadersaid there were “problems” with the approach advocated by some, including the Liberal Democrat leader, Ed Davey, who has called for a £3bn support scheme to help vulnerable borrowers.
Starmer said Labour, were it in power, would tell financial regulators to force banks to offer mortgage holders more flexibility with their repayments – an approach that would require no additional spending.
He told the Times CEO Summit: “There’s no answer to this that doesn’t go with economic stability.”
Speaking later, after the Bank announced its rate rise, Starmer told Times Radio: “If there is one issue keeping people awake at night it is paying the bills, so this is really, really bad news for so many families.
“I think, of course, there’s no quick fix. We’ve got to be honest about that. There is inflation across the world, there are global factors. But this country always gets hit hardest, whether it’s mortgage rates, interest rates, energy prices, food prices.”
Experts say repeated interest rate rises have left the UK facing a “mortgage timebomb”, with borrowers on fixed-rate deals only feeling the effect when those terms expire.
Jeremy Hunt, the chancellor, will meet big banks on Friday to discuss what flexibility they can show to homeowners who fall behind on their payments.
Some Tory MPs are calling for tax relief to be granted on interest repayments as a way to ease the pressure on borrowers. But ministers say they do not want to intervene in the mortgage market, not least because doing so could fuel inflation and undermine the point of the interest rate increases.
The Lib Dems have called for a temporary relief package that would offer grants of up to £300 a month for anyone whose repayments rise by more than 10% of their household income. The party said the scheme would cost £3bn, which it said could be funded by reversing cuts to bank taxes that the government announced last year.
Labour says it wants the Financial Conduct Authority to force banks to offer greater flexibility for borrowers, including by allowing people to move on to interest-only mortgages and delaying repossession proceedings. The party’s approach reflects concern among shadow ministers that they should avoid promising anything that opponents could claim would require a tax rise to fund.
Rachel Reeves, the shadow chancellor, told the BBC’s Today programme: “I recognise the challenge of inflation, and a big fiscal injection of cash into the economy, especially an untargeted injection, would not be the right approach.”
Gavin Barwell, the former Tory MP and chief of staff to Theresa May, responded to Reeves’ comments on Twitter, saying: “Sure sign an opposition thinks it is going to win is when its leaders reject populist policies that would only make things worse in the medium term.” | Interest Rates |
UK government runs surprise budget surplus in January
The UK government ran a surprise surplus of over £5bn last month, as tax receipts boosted the public finances.
Figures just released by the Office for National Statistics show that the UK’s public finances were in surplus by £5.4bn in January.
That’s £7.1bn smaller than in January 2022, but is £5bn larger than forecast by the Office for Budget Responsibility (OBR), the ONS says.
That suggests the public finances are in better shape than expected, which could help chancellor Jeremy Hunt as he draws up next month’s budget. It might give Hunt more wriggle room to help struggling households.
Self-assessed income tax receipts hit a record – at £21.9bn, which is the highest January figure since monthly records began in April 1999. That’s 5.5bn more than in January 2022.
January is usually a good month for the public finances, as workers and companies settle their tax bills before the deadline at the end of the month.
But, the ONS points out that government spending was pushed up by “substantial spending on energy support schemes and large one-off payments relating to historic customs duties owed to the EU”.
Inflation continued to drive up debt repayment costs too.
Central government debt interest payable was a record for any January, at £6.7bn, lifted by higher repayment costs on index-linked gilts (government bonds whose interest rate is fixed to the RPI measure of inflation).
Energy crisis stemming from Ukraine war ‘cost £1k for every UK adult’
Alex Lawson
The UK’s over-reliance on gas has been blamed for pushing up bills as it emerged that the energy crisis stemming from the war in Ukraine had cost the equivalent of £1,000 for every adult.
A study by the Energy and Climate Intelligence Unit (ECIU) estimated that high wholesale gas prices since Russia’s invasion of Ukraine nearly a year ago had cost UK energy suppliers an additional £50bn to 60bn, on top of the £10bn to £20bn spent in a normal year.
The invasion spurred wholesale gas prices, which were already above historical averages, to record highs.
Household energy costs are far higher than the £1,000 extra highlighted by ECIU – which does not account for normal wholesale costs, suppliers’ margins and other charges wrapped into bills.
More than half of private renters living in cold, damp or mouldy homes
Around 1.6 million UK children are living in excessively cold, damp or mouldy rented homes, a survey by Citizens Advice warns this morning.
Citizens Advice has found that more than half of private renters in England, totalling 2.7m households, are struggling with damp and draughty rented homes - and it’s affecting their health.
The problem is especially bad in the least energy efficient homes.
The charity reports that private tenants are 73% more likely to be living with damp if they live in a property with a Energy Performance Certificate (EPC) rating of D-G rather than A-C, and 89% more likely to experience excessive cold in a D-G rated property.
Forty percent of renters felt stressed as a result of damp, mould and excessive cold, with 36% saying it made them feel anxious, Citizens Advice says.
The charity is calling for private housing landlords to be held to new standards set out after the death of Awaab Ishak, the two-year-old who was killed by mould in a social housing flat in Rochdale in 2020.
“Awaab’s law”, announced this month, will set strict, legally binding timelines on social landlords in England and Wales to tackle reported hazards.
Gillian Cooper, Head of Energy Policy at Citizens Advice, says:
“Every week we hear stories of people living in cold, damp and mouldy properties they can’t afford to heat properly.
“It’s shameful that more than 20 years since legislation came into force to reduce fuel poverty and improve the energy performance of homes, people are still suffering.
“Improving energy efficiency in privately rented homes has never been more urgent. It’s the step needed to keep people’s essential bills low, while also helping to protect their mental and physical health.”
Introduction: Quarter of UK households regularly run out of money for essentials
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Britain’s cost of living crisis means almost one one-quarter of households regularly run out of money for essentials, a group of charities are warning today.
Nationally, 37% of people end the month with no money left over, while nearly one-quarter (24%) run out of money for essentials either most months or most days, a survey for the Together Through This Crisis initiative has found.
Its survey found that nearly 40% of people end the month with no money left, while 24% run out of money for essentials either most months or most days, a survey found.
The research by the frontline charities signals the widening political risk of the cost of living crisis, our social affairs correspondent RobertBooth explains:
Macmillan Cancer Support separately warned that cancer patients were resorting to selling possessions and using loan sharks to make ends meet. In findings it described as “heartbreaking”, the charity said a third of patients had been buying or eating less food, and 22% had been spending more time in bed to stay warm, while there had been a jump in the number of calls to its helpline about financial issues.
Even among the 10 most affluent constituencies in the UK, 19% of people said they found themselves unable to pay for food or bills by the end of most months, according to the survey by Together Through This Crisis.
Matthew McGregor, the chief executive of 38 Degrees, a charity that organises campaigning petitions, said: “This polling paints a bleak picture of the crisis unfolding across the country: families running out of money to put food on the table and keep kids warm is rapidly becoming our new normal.
Together Through This Crisis has written an open letter to Prime Minister Rishi Sunak and Chancellor Jeremy Hunt asking them to “take action to ensure the crisis illustrated by these figures does not become the UK’s new normal”.
Also coming up today
A flurry of surveys of purchasing managers across the globe will show how companies are faring this month.
We also get a healthcheck on German economic morale, and UK factories, while MPs on the Business, Energy and Industrial Strategy Committee will question business minister Kevin Holinrake on the push to get older workers back into jobs.
The agenda
7am GMT: UK public finances report for January
9am GMT: Eurozone ‘flash’ services and manufacturing PMI report for February
9.30am GMT: UK ‘flash’ services and manufacturing PMI report for February
10am GMT: ZEW index of German economic sentiment
10.15am GMT: BEIS committee hearing on the UK’s aging workforce
11am GMT: CBI industrial trends survey of UK manufacturing
2.45pm GMT: US ‘flash’ services and manufacturing PMI report for February
3pm GMT: US existing home sales report for January | United Kingdom Business & Economics |
The UK is on course to experience five years of "lost" economic growth and is at risk of a recession next year, according to an economic think tank.
The National Institute of Economic and Social Research (Niesr) said by 2024 income inequality will have grown, along with unemployment and levels of debt.
Researchers, writing in the think tank's latest quarterly outlook, said "elevated housing, energy and food costs" would continue into next year, while gross domestic product (GDP) - a key indicator of a country's economic output - would likely "barely grow".
It said GDP was currently 0.5% below the level it was before the pandemic, and would not pass that level for another year - but also cautioned the outlook was "highly uncertain".
"There are, in fact, even chances that GDP growth will contract by the end of 2023 and a roughly 60% risk of a recession at the end of 2024," the think tank warned.
Its last forecast in February predicted that the UK would avoid a recession in 2022 - but said the strain from the cost of living crisis would make it "feel like" one.
Niesr's outlook is more pessimistic than the Bank of England's forecasts last week, which came as it raised the base rate for the 14th time in a row.
The Bank suggested a recession was unlikely in the coming years but did imply that the economy will effectively flatline all the way through to 2026.
Its chief economist, Huw Pill, also recently warned that food prices may not fall back to what they were prior to the war in Ukraine.
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On UK inflation, Niesr forecast that it will remain above the Bank's 2% target until 2025, but said it could fall to 5.2% by the end of this year.
Real-terms wages in many UK regions are also expected to be below pre-pandemic levels by the end of 2024, according to the forecasts.
The poorest households will also experience a 17% shortfall in their disposable incomes in 2024 compared with five years earlier, while the richest households will only see a 5% drop, researchers predicted.
Professor Stephen Millard, Niesr's deputy director for macroeconomic modelling and forecasting, said the "triple supply shock" of Brexit, the COVID pandemic and Russia's invasion of Ukraine were major factors behind the dire economic outlook.
He said "the monetary tightening that has been necessary to bring inflation down" had also played a role.
Professor Millard added: "The need to address the UK's poor growth performance remains the key challenge facing policy makers as we approach the next election."
It comes after chancellor Jeremy Hunt said last week that he was working on plans to get the UK economy back on track.
He told Sky News: "What you'll see from me in the autumn statement is a plan that shows how we break out of that low growth trap and make ourselves into one of the most entrepreneurial economies in the world." | United Kingdom Business & Economics |
Northern leaders have hit out at the decision to axe HS2 between Birmingham and Manchester, claiming the government is treating people in the region as "second class citizens".
Rishi Sunak has confirmed the rail link that was due to connect the two cities will not go ahead.
Instead, Mr Sunak pledged to reinvest around £36 billion of savings into other northern rail and road schemes.
Greater Manchester mayor Andy Burnham said there was "frustration and anger".
He said: "It always seems that people here where I live and where I kind of represent can be treated as second class citizens when it comes to transport.
"It just proves there's still so many people in politics, many of them in the Tory party, that think they can treat the north of England differently to the way they treat other parts of the country it's just so wrong."
He later added: "I don't see how you can take a plan that goes beyond the life of any individual government and basically tear it up at a party conference, surely this should be done on a cross-party consultative basis."
Henri Murison, the chief executive of Northern Powerhouse Partnership, said the decision was a "national tragedy - economically at least".
"That's because in 100 years the economy of the north will be smaller because of this decision," he said.
Mr Sunak said HS2 was "the ultimate example of the old consensus" and that the economic case for the line was no longer justified. "The facts have changed and the right thing to do when the facts change is have the courage to change direction", he said.
In place of HS2 the prime minister said a new "Network North" would be prioritised.
He told the conference hall, to huge applause, that the network would allow commuters to get from Manchester to the new station in Bradford in 30 minutes, Sheffield in 42 minutes and to Hull in 84 minutes on a fully, electrified line.
Labour's shadow transport secretary Louise Haigh responded to the announcement by saying: "The Conservatives promised Northern Powerhouse Rail sixty times and in three consecutive Conservative manifestos.
"After this Tory fiasco, why should anyone believe the Tories can deliver anything they say?"
Darren Caplan, chief executive of the Railway Industry Association, said workers were "extremely disappointed" by the decision - which he described as an unnecessary "nuclear option".
He said: "It's defeatist and sends a terrible signal to potential overseas investors that the UK simply cannot deliver large national transport infrastructure schemes."
Mr Caplan said the government could have worked with mayors, the railway industry, rail suppliers and other stakeholders to "agree a cost-effective way forward."
'Jobs not created'
He added: "This blows a hole in the government's levelling-up and decarbonisation agendas.
"None of the replacement regional schemes referred to will have the same impact of building HS2 in full."
Cheshire and Warrington Local Enterprise Partnership said the move would "deprive the region's economy of £2bn billion per year".
A spokesman said: "HS2 would have had a transformational impact across Cheshire and Warrington, creating 27,000 new jobs, delivering 6 million square feet of new commercial floor space and 25,000 new homes."
The group said they would be "looking carefully at the prime minister's promise to recycle the £36bn that he says will be saved from HS2".
Tory MP Andy Carter, who represents Warrington South, said on the doorsteps he "consistently heard" that HS2 was not a priority for people.
"It's east-west links that really do make the difference for people in Warrington", he said.
"There's a commitment for £12 billion worth of spending to improve east-west links, I'm really pleased with that."
But Zoë Billingham, director of the IPPR North think tank, remained unconvinced saying: "New promises heard today to redeploy HS2 funding - across the whole country - not only undermines levelling up but also lacks credibility." | United Kingdom Business & Economics |
It's still only November, but the Christmas TV adverts are coming in thick and fast, bringing a sprinkling of festivity to our screens.
Many of this year's ads are fronted by A-list stars, from Michael Bublé and Rick Astley to Sophie Ellis-Bextor.
But John Lewis's commercial, released on Thursday, instead tells the tale of a little boy and a Venus flytrap.
"It will be hoping the theme of family values works," said retail expert Catherine Shuttleworth.
Charlotte Lock, customer director at John Lewis, told the BBC the retailer "asked for something that moved us on from last year and was different".
John Lewis is the latest big name brand to beam its festive message into UK homes.
"The overall theme in this year's Christmas adverts is glitz, fame and fun," Ms Shuttleworth added. "John Lewis has opted instead for a vision of a modern family Christmas. Let's see if it works."
Set to a track called Festa sung by opera legend Andrea Bocelli, the advert shows a little boy, Alfie, who plants his own Christmas tree - only to find it grows into a carnivorous Venus flytrap called Snapper.
But his family eventually embrace the idea of a new tradition, and even enlist the help of Snapper to open their presents on Christmas morning.
Whereas last year's ad was toned down to reflect the cost of living crisis, this year's advert focuses on family and evolving traditions.
"It's not the tradition itself that matters, it's how it brings together families and loved ones," Ms Lock said.
Star power
Many other retailers have spent heavily on recruiting famous faces to front their campaigns.
Sascha Darroch-Davies, co-founder of creative music agency DLMDD, said many have gone with celebrities "because they have cultural currency".
"There's not a lot of risk-taking at Christmas. Celebrities are a formula that has worked before," he told the BBC. "It's a tough time for retailers. Many are struggling. They know this is usually a safe bet."
Marks and Spencer was quick off the mark with its Christmas food advert, which sees the return of Dawn French as a festive fairy.
She is joined by Hollywood actors and Wrexham football club co-chairmen Rob McElhenney and Ryan Reynolds, who voice 'the Mittens' in the six-part ad.
The trio dance around the house, ending up in the dining room, where a table is seen groaning under the weight of an M&S Christmas feast.
M&S's Christmas clothing and home advert also recruits well-known faces including actors Zawe Ashton and Hannah Waddingham, Queer Eye presenter Tan France, and singer Sophie Ellis-Bextor.
Whereas John Lewis focuses on changing traditions, M&S's ad suggests people should simply do away with Christmas traditions they no longer love.
However, M&S was forced to apologise after an outtake from the advert - showing red, green and silver hats burning in a fireplace - was criticised by some who said it resembled the colours of the Palestinian flag.
The company removed the photo, which it had posted on Instagram, and said the advert was filmed in August, before the latest Israel-Gaza conflict began.
Some might argue that controversies don't matter, and indeed might help a company, by getting its advert talked about. But Sophie Lewis, chief strategy officer at creative company M&C Saatchi, disagrees.
"I don't think controversy at Christmas is ever advisable," she told the BBC. "And I do not think for one second that M&S were courting it in the case of the ad they pulled, and then re-edited."
Ms Lewis said time would tell whether, and to what extent, the row has affected M&S.
Elsewhere, Bublé has been defrosted for Christmas, and is the star of Asda's ad this year.
The crooner takes on the role of Asda's chief quality officer, making the big decisions on what food the nation should eat this Christmas.
Opinion on social media was mostly positive, with some expressing surprise to see that Bublé can act as well as sing. But others felt the ad fell short after the success of Elf last year.
Not to be outdone, Sainsbury's casts 1980s icon Rick Astley alongside real supermarket workers as they explore what Santa's Christmas dinner would be.
It concludes a huge year for Astley, who also played Glastonbury Festival for the first time in June, leading a mass sing-a-long to some of his classic hits.
The singer achieved internet notoriety through the Rickrolling meme, in which users are pranked when they click on an unrelated link, only to be redirected to his famous song Never Gonna Give You Up.
The hashtag #RickAstley has also accumulated more than 716 million views on the TikTok app.
"Winning over shoppers' hearts and minds is quite challenging in the cost of living crisis so you've got to really find a way to make a people smile," said Ms Shuttleworth.
"Bublé and Rick Astley achieve that. People are wanting to get excited for Christmas, and that's what these ads do."
Not all of this year's Christmas adverts have a star line-up.
Argos has shunned celebrities in favour of cartoon duo Connie the doll and Trevor the dinosaur.
And Lidl has gone for the tried and tested formula of recruiting a furry friend - a favourite for retailers at Christmas. Its advert follows a raccoon that goes out of its way to make one little boy's day extra special.
'Making TV history'
Taken as a whole, advertisers are set to spend a record £9.5bn during this festive season, according to new data by the Advertising Association and World Advertising Research Centre.
Whether that will pay off in attracting new customers is "impossible" to tell, says cultural historian Dorothy Hobson.
"But companies would not waste the vast sums of money they spend on making the ads and buying the air space if they were not getting a good return on their outlays," she told the BBC.
Retailers are treading a fine line, she said. Their Christmas adverts are planned months in advance, so it's important they don't have the wrong ambiance when they hit the reality of the everyday lives of their customers.
That's one reason why ads often stick to safe territory, showing empathy and care of others. If they get it right, they can become a major cultural moment.
"They have become a cultural genre in their own right, which means that they are fulfilling their function by making us look forward to them and talk about them," Ms Hobson said.
"And if they are good, they become part of the history of television." | Consumer & Retail |
Cabinet ministers and Whitehall mandarins approved payments totalling £60m to Saudi royals and high-ranking officials over decades to secure and maintain a huge arms deal, a court heard on Monday.
The accusation was made by Tom Allen, a barrister representing one of two men who are being prosecuted for corruption in a longstanding arms deal between the UK and Saudi Arabia.
Allen alleged that British politicians – including unnamed “secretaries of state and ministers” – approved, facilitated and encouraged the payments over many years to ensure that leading Saudis gave huge arms contracts to British firms.
Senior members of the British government and military figures were “absolutely in the thick” of organising the payments, a large slice of which went to a Saudi prince, he said.
He also claimed that the British and Saudi governments engaged in what he called a “deniable fiddle” to conceal the payments if they came to light.
At Southwark crown court in London, the Serious Fraud Office is prosecuting the two men, Jeffrey Cook, 67, and John Mason, 81, for authorising corrupt payments amounting to £9.7m to senior Saudis between 2007 and 2012.
The SFO alleges that the payments were made to Prince Miteb bin Abdullah and other senior Saudi officials to make sure that a British firm, GPT, secured lucrative contracts from the Saudi military.
Cook, a former Ministry of Defence civil servant, was GPT’s managing director. Mason worked for a firm that is accused of channelling the bribes to the Saudis.
On Monday, Allen, defending Cook, said he had been “hung out to dry while the government is hiding its blushes”. He alleged that a wide cast of senior British officials, including military, political and diplomatic figures, had long known about, and approved, the payments to leading Saudis.
“No one with a title, or a military rank, or a gong is standing before you,” Allen said, “but it couldn’t have happened without them”.
Allen argued that documentary evidence showed the British government had organised and approved payments amounting to £60m to the leading Saudis long before Cook became involved. He said that the payments had been put in place at the beginning of the arms deal, which was struck in 1978.
The arms deal, which is still running, involves the supply of military communications equipment to a Saudi military unit, which was at one time headed by Miteb.
Allen told the court that the Saudis had required the payments to ensure that they continue to give the arms contracts to British firms. In turn, the British government had approved “each and every penny” since 1970s, he said.
“Had the government not endorsed and approved payments in the past, the work from which the UK benefited would no doubt have never occurred,” he added. “Britain tries never to upset Saudis, because there’s so much at stake.”
Graham Brodie, the barrister defending Mason, said the British government wanted the deal to continue “because it was in the financial interests of the UK and in the strategic interests of the UK. It assisted in the maintenance of a relationship with Saudi Arabia.”
The SFO has alleged that Miteb received the largest share of the payments between 2007 and 2012, along with other Saudi officials. In its prosecution, the SFO said the payments were made through a businessman, Salah Fustok.
Allen described Fustok as a “man who was up close and personal with the British government in their dealings with Saudi Arabia for decades”. “He features meeting the high and mighty, lunching with our ambassador in Saudi Arabia right in the middle” of the period in which Cook and Mason are alleged to have organised the payments, Allen added.
Mark Heywood, leading the prosecution for the SFO, told the court that Cook and Mason “were at the very heart of the operation” and were not acting with the approval of others. “They saw to it that the millions passed on to the middlemen kept coming.”
Heywood told the jury: “You will not have to decide whether or not bribes were paid. They were, and that much will be accepted by each of these two defendants.
“The real question for you to decide will be whether it’s been proved that [each defendant] was a knowing party to the making of the payments, and that those payments were corrupt according to the law.”
The trial continues. | United Kingdom Business & Economics |
The new 20mph speed limit for Wales' residential roads is "insane", according to a UK cabinet minister.
Commons leader Penny Mordaunt called having such a limit as the default for many roads "crazy", but agreed there are places where 20mph is a good idea.
Ms Mordaunt went on to accuse Labour of "punishing" motorists.
The Welsh government says that cutting the speed from 30mph to 20mph on most residential roads would protect lives and save the Welsh NHS £92m a year.
Most roads in Wales that are currently 30mph will become 20mph from Sunday, although councils have discretion to impose exemptions.
Labour's First Minister Mark Drakeford has said it is the "right thing to do", citing a fall in urban road deaths in Spain after it made a similar change in 2019.
Speaking in the House of Commons, Conservative Ynys Môn MP Virginia Crosbie said: "The Labour government in Cardiff, supported by Plaid Cymru, will be introducing a blanket 20mph speed restriction in built-up areas across Wales from September 17.
"In many places - outside schools, outside hospitals - 20mph is appropriate.
"Does the leader of the house agree with many of my Ynys Môn constituents that this blanket approach will impact main roads and impact the Welsh economy?
"And will she make time for a debate on how we should be supporting the Welsh economy, not punishing it?"
Ms Mordaunt replied: "This is absolutely insane even by the standards of Labour's Welsh government.
"They have ignored businesses and they have ignored the public. They are pushing ahead with this scheme despite huge opposition to it and I think the latest estimate is it will cost the Welsh economy £4.5bn.
"But, more disturbingly, it is going to increase individuals' fuel bills considerably and actually be harmful to the environment.
"[Ms Crosbie] is right, there are circumstances where, of course, 20mph speed limits are a good idea, but having them as the default for many roads is crazy.
"Instead of punishing motorists, Labour should be focusing on fixing public transport, in particular the trains."
Explaining the £4.5bn cost to the economy figure quoted by critics of the policy, the Welsh government writes on its website: "Our assessment shows that reducing speeds to 20mph can result in an average increase of one minute per journey, nine lives saved and 98 serious injuries prevented each year.
"Before the law was passed, we produced an impact assessment that considered all the potential costs. This was included in the explanatory memorandum.
"It included the costs of any delays to travel time. The method used is now under academic debate for its effectiveness when calculating small delays.
"So the estimated cost to the economy of £4.5bn over 30 years may not be an accurate reflection of the true cost. The slightly longer travel time was the only negative economic impact identified.
"It is estimated that the casualty prevention savings, including the reduced impact on NHS and emergency services, could be up to £92m every year."
Welsh Labour ministers dispute the suggestion that the speed limit reduction is a "blanket" policy, accusing Conservative politicians of making false claims because councils have imposed exemptions, meaning that the 30mph limit will stay on some urban roads on Sunday.
Not in England
Downing Street has ruled out introducing the 20mph speed limit in England.
No 10 was asked about the Welsh government's new law at the daily lobby briefing for journalists.
Asked if Rishi Sunak would consider rolling out the 20mph law elsewhere in the UK as suggested by the road safety charity Brake, the prime minister's official spokesperson said: "no".
Pressed if the prime minister had a message for Wales as the new law comes into force on Sunday, the spokesperson added that the matter had not been discussed.
"That's a devolved issue so I think it's probably one for the Welsh government," he said.
Mark Drakeford has promised to review the impact of this major change to roads policy Wales, in conjunction with local authorities.
Additional reporting from Shelley Phelps | United Kingdom Business & Economics |
With inflation still impacting everything from lunchboxes to lunch supplies, many American parents may be planning to scale back on their annual back-to-school hauls this year.
Deloitte just released its 2023 back-to-school survey, and the report forecasts total spend will drop 10% to $597 per child this year — the first decline since 2014.
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The K-12 back-to-school market is set to decrease 9% to $31.2 billion.
"With budgets strained this season, continued high prices could dampen the excitement of the back-to-school season for many families,” said Nick Handrinos, Deloitte vice chair and U.S. retail consumer products leader, in a press release.
Handrino says parents will likely be strategic and hold off on some purchases, like clothing, while still renewing their essential school supplies.
“It's not all bad news for retailers with many parents willing to splurge on certain items to treat their children, which may provide an opportunity for retailers," he adds.
Parents are feeling financially stressed
Although inflation cooled to 3% last month, prices are still stubbornly high and constraining parents’ wallets. In fact, there’s been a 23.7% increase in the cost of school supplies over the past two years, based on Deloitte’s analysis of Bureau of Labor Services data.
The report also revealed that 3-in-10 households say they’re in a worse financial situation than last year, half expect the economy to weaken in the next six months. And it couldn’t come at a more challenging time, as U.S. household debt hit a record $17 trillion. On average, consumers owed $986 billion on their credit cards in the first quarter of 2023, the New York Fed revealed in May.
And across all income groups, shoppers told Deloitte they’re planning to spend less on back-to-school supplies, with many blaming higher prices or reduced disposable income.
As a result, over a third are now postponing shopping nonessentials — prioritizing school supplies over tech and clothing.
Read more: 3 big mistakes people make with cash back credit cards that cost them every time they swipe
Look for summer deals and sales tax holidays
While the majority of shoppers are choosing to venture into stores in search of better bargains, some are also looking online. And 62% of those who use social media are also using it to track down deals, compared to 56% last year.
Choosing stores with friendly customer service policies is also important to Americans — nearly 3 in 5 say they’re sticking to retailers with free return policies, while those shopping digitally are keeping their eyes peeled for low purchase thresholds to score free delivery.
Although Amazon’s Prime Day ends today, there are plenty of other sales to take advantage of before September.
Walmart recently announced it will be holding supplies, like notebooks, crayons and backpacks, at last year’s prices. (Which, considering inflation was 8.3% last August, isn't likely to make a huge difference for consumers — but it is something.) And aside from Target Circle Week (which ends on July 15), the retailer is also featuring 20% discount events for teachers and college students from July 16 to Aug. 26.
Depending on what state you live in, you may be able to take advantage of some tax-free events on clothing, school supplies and tech as well. Just keep in mind that different exclusions or price limits may apply.
Here's a list of the state sales taxes still to come this summer:
Alabama: July 21–23
Arkansas: August 5-6
Iowa: August 4-5
Maryland: August 13-19
Mississippi: July 28-29
Missouri: August 4-6
New Jersey: August 26-September 4
New Mexico: August 4-6
Ohio: August 4-6
Oklahoma: August 4-6
South Carolina: August 4-6
Tennessee: July 28-30
Texas: August 11-13
West Virginia: August 4-7
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind. | Inflation |
Follow me on Twitter @Jacqmelinek for breaking crypto news, memes and more.
Welcome back to Chain Reaction.
Earlier this week, EDX Markets launched its digital asset platform, the firm shared on Tuesday. But what has made this launch catch a lot of attention? Its founding investors, which include major traditional firms like Charles Schwab, Citadel Securities, Fidelity Digital Assets and Sequoia Capital, alongside Paradigm and Virtu Financial.
The company also recently closed a fresh funding round that brought on additional strategic investors, including Miami International Holdings, DV Crypto, GTS, GSR Markets LTD and HRT Technology. The new capital will be used to help develop EDX’s trading platform, among other elements.
The platform aims to be the “crypto marketplace of choice for industry leaders,” with plans to build on traditional finance practices to provide liquidity, competitive quotes and a non-custodial model to mitigate conflicts of interest, it said. The platform also introduced a “retail-only quote to the crypto markets,” which allows users to get better pricing for retail orders.
The platform will have limited offerings for the foreseeable future, until there is more regulatory clarity, EDX Markets CEO Jamil Nazarali said in April. Current cryptocurrencies that are tradable on EDX are on the lighter side, with only four options: bitcoin, ether, litecoin and bitcoin cash.
The crypto exchange initially made headlines after it was announced in September, two months prior to the FTX collapse, and initially planned on launching in November, Bloomberg reported.
The launch comes at a time when a lot of heat is ramping up for the crypto industry as regulators like the U.S. Securities and Exchange Commission crack down on major crypto exchanges like Binance and Coinbase for allegedly violating securities laws, among other reasons.
The support for EDX also points to a growing interest in digital assets among traditional players — even if the crypto markets are down from all-time highs.
Separately, last week, BlackRock, which has about $9 trillion in assets under management, filed with the SEC to form a spot bitcoin ETF that would be custodied on Coinbase. The filing was through iShares, a fund management unit under BlackRock’s wing.
Although a handful of futures-based bitcoin ETFs exist, the SEC has shot down other firms’ attempts to create spot-based bitcoin ETFs in the past. Given that the filing arrived at a pivotal moment for the U.S.-based crypto ecosystem, there may be some conversations behind closed doors that could be ongoing between BlackRock and the SEC. But whether or not BlackRock has a fighting chance for approval is TBD, but my (not always accurate) crystal ball thinks it’s still unlikely for the asset management giant to get its spot bitcoin ETF approved, given recent regulatory actions that have transpired.
This week in web3
As the U.S. Securities and Exchange Commission continues to scrutinize the crypto industry, the agency’s director of enforcement, Gurbir Grewal, says the regulator is more concerned with securities being sold in a format that adheres to existing laws rather than with labels or technology.
Having spent part of the week interacting with the U.K’s tech scene, TechCrunch can confirm that reports of its death are greatly exaggerated. VCs keep flocking to London for dealmaking, and many are happy to call it home. The latest move is a16z’s: The firm picked London for a16z crypto’s first international office, set to be led by general partner Sriram Krishnan. And it makes it clear that its conversations with British policymakers and regulators played a role in the decision.
The latest pod
For last week’s episode, I interviewed Patrick Kaminski, the director of digital innovation for web3 and metaverse at L’Oréal, and Manon Cardiel, head of strategic planning and partnerships within web3 and metaverse at L’Oréal.
Patrick is the leader behind NYX Professional Makeup’s GORJS DAO, which launched in mid-January with hopes of combining the NFT world and the beauty industry in the metaverse. While Manon worked on the GORJS project, she also helped launch NFT collections for companies like Mugler and Yves Saint Laurent.
L’Oréal is best known for its beauty products, but the more than 100-year-old company is also home to a plethora of brands that many of us use and own like Maybelline, Yves Saint Laurent, Armani, Kiehl’s, Valentino, Prada, CeraVe and more.
We discussed why L’Oréal wanted to get into the web3 ecosystem, what it’s like incorporating a DAO into a traditional brand and how other brands and companies are — or aren’t — getting into the cryptosphere.
We also dove into:
- Growing brand loyalty
- Consumer demand and feedback
- Brands skepticism of NFTs, metaverse
- Advice to brands looking to get into web3
Follow the money
- DeFi infrastructure provider Maverick Protocol raised $9 million
- Yield-earning DeFi platform Earn Network raised a $2.7 million seed round
- Binance Labs led $10 million round for cosmos-focused smart contract platform Neutron
- Singapore-based digital payment provider dtcpay raised $16.5 million in a pre-series A round
- TapiocaDAO, a money market powered by LayerZero, raised a $6 million seed round
This list was compiled with information from Messari as well as TechCrunch’s own reporting.
To get a roundup of TechCrunch’s biggest and most important crypto stories delivered to your inbox every Thursday at 12 p.m. PT, subscribe here. | Crypto Trading & Speculation |
A New York appeals court reinstated a gag order preventing former President Donald Trump from maligning court staffers on Thursday.
New York Judge Arthur Engoron had initially issued the gag order in early October after Trump lashed out at one of his law clerks on social media. Trump is currently fighting accusations of business fraud leveled by New York Attorney General Letitia James.
Appeals court Judge David Friedman had issued a stay on Engoron's gag order on Nov. 16, saying it potentially infringed on Trump's First Amendment rights.
By that time, Engoron had already fined Trump $5,000 for violating the order on social media on Oct. 20, and did so again on Oct. 25 for another $10,000 before threatening imprisonment if further violations were committed.
Trump took the stand to testify personally in early November. He repeatedly cast James’ years-long investigation and lawsuit as a "disgrace" and an attack on his business and his family.
Trump has denied any wrongdoing and insists his assets were actually undervalued. Trump has repeatedly said his financial statements had disclaimers requesting that the numbers be evaluated by the banks.
Engoron ruled in September that both Trump and his company had committed fraud by deceiving banks, insurers and others by overvaluing his assets and exaggerating his net worth on paperwork used in making deals and securing financing.
"There was no victim here – the banks were represented by the best, biggest, most prestigious law firms in the state of New York – actually in the country, some of the biggest law firms," Trump said when the trial began. "The banks got back their money, there was never a default, it was never a problem, everything was perfect. There was no crime."
Trump has attacked Engoron and James--both Democrats--as politically biased "operatives."
"They are defending the Worst and Least Respected Attorney General in the United States, Letitia James, who is a Worldwide disgrace, as is her illegal Witch Hunt against me. The Radical and Unprecedented actions of Judge Engoron will keep BUSINESSES and JOBS forever out of New York State," Trump wrote in a recent social media post.
Fox News' Brooke Singman and Brandon Gillespie contributed to this report | Banking & Finance |
Workers in the UK are some of the least job orientated people in the world, according to a new study.
Research has found that less than one in four people think their career should come first in their lives.
Overall, 73% of Britons polled in the World Values Survey said work was an important part of their lives - compared to 96% in Italy and 94% in France.
Only 22% of those UK workers said their jobs should always come first, even if it means less spare time.
Between 1981 and 2022, the share of the British public who said it would be a good thing if less importance was placed on work rose from 26% to 43%.
The results, which have been analysed by the Policy Institute at Kings College London, also found generational differences in attitudes towards employment.
Professor Bobby Duffy, director of the Policy Institute at King's College London, said: "Older generations are more likely to say work should be prioritised, even as it becomes less important in their own lives as they move into retirement.
"Millennials, in contrast, have become much more sceptical about prioritising work as they've made their way through their career.
"There will be a number of explanations for these shifts, from the nostalgia that tends to grow as we age, in thinking younger generations are less committed than we were, and the long-term economic and wage stagnation that will lead younger generations to question the value of work."
Read more on Sky News:
Vacancies and starting salaries 'fall for first time this year'
Rise in staff working from home as cost of living bites
Bosses hesitating to hire, survey finds
More than half of millennials, people in their late 20s to early 40s, said it would be a good thing if less importance was placed on work, a rise from 31% in 2005.
But only 34% of baby boomers, people aged in their late 50s and 70s, agree - and just 22% of the pre-war generation. | United Kingdom Business & Economics |
Rishi Sunak has signalled the government could delay or even abandon green policies that impose a direct cost on consumers, as he comes under pressure from the Conservative right to create a dividing line with Labour at the next election.
The prime minister said the drive to reach the UK’s net zero targets should not “unnecessarily give people more hassle and more costs in their lives” as he rethinks his green agenda after last week’s Uxbridge and South Ruislip byelection.
Downing Street confirmed on Monday that the government would “continually examine and scrutinise” measures including a ban on new petrol and diesel cars by 2030, phasing out gas boilers by 2035, energy efficiency targets for private rented homes and low-traffic neighbourhoods.
However, environmental groups could challenge any decision to water down green policies in court as the government has a legal obligation to set out in detail how it will meet its net zero target by 2050 with clear carbon budgets for different sectors.
The move to row back on some green measures comes after the Tories’ opposition to the expansion of London’s ultra-low emission zone (Ulez) was credited for their narrow byelection victory in Boris Johnson’s former seat on 20 July.
Tory strategists believe they could replicate their win in other newly marginal seats across the country by creating clear dividing lines with Keir Starmer’s Labour, which has its own internal tensions over environmental policy since the byelection.
On a visit to the West Midlands, where he arrived by helicopter despite the journey only taking 90 minutes by train, Sunak was asked if he would stand up to Tories who are urging against net zero measures after Jacob Rees-Mogg said that “getting rid of unpopular, expensive green policies” created a political opportunity.
The former business secretary told GB News: “I thought Uxbridge was a fundamentally important result for us. It shows that if you are on the side of voters and doing things to make their lives better, rather than worse, then lo and behold people will actually vote for you.
“Let other countries catch up and let us catch their breath. Let us move away from an ideological view of net zero and work with the environment in a way that is affordable.”
However, Sunak responded: “We’re living through a time at the moment where inflation is high. That’s having an impact on household and families’ bills. I don’t want to add that, I want to make it easier.
“So yes, we’re going to make progress towards net zero but we’re going to do that in a proportionate and pragmatic way that doesn’t unnecessarily give people more hassle and more costs in their lives – that’s not what I’m interested in and prepared to do.”
Sunak also faces pressure from more environmentally minded Tories. Chris Skidmore, the former net zero tsar, said: “This isn’t a crusade, it is the only proportionate and pragmatic way in which the UK can avoid higher costs over time and to establish the industries of the future, rather than be stranded in the past.
“Net zero isn’t about ideology, it is about delivering jobs and growth and investing in a transition that is going to happen. The UK has the choice of leading the change, or following, missing out in turn on the investment and jobs that could have been ours for the taking.”
Zac Goldsmith, the former environment minister who resigned last month accusing Sunak of being “uninterested” in green issues, urged the prime minister not to use criticism of Ulez as an excuse to backtrack on his net zero pledges.
“You can make the case that it’s a clumsy policy, that it’s going to affect people who can least afford it. There are all kinds of arguments made about that and lots of policies relating to the environment and climate change,” he told the Guardian.
“The job of governments and politicians is to find the solutions that are going to be the least painful, most effective, and if that requires you to rethink individual policies then go for it. But what I think is not negotiable, is the overarching challenge that we face.”
Cameron Smith, of the Conservative Environment Network, said: “The lesson from the Uxbridge byelection is that environmental action is only popular if it’s fair and affordable. Ulez expansion failed that test. But voters won’t reward us for ditching popular net zero policies, which will lower people’s bills, create jobs and win investment.”
Downing Street is believed to be considering whether to delay a ban on new petrol and diesel car sales beyond 2030. Sunak would only say “of course net zero is important to me” when asked about the policy, adding the approach must be “proportionate and pragmatic”.
Hours earlier, the development minister Andrew Mitchell refused to confirm that the ban would stay in place, telling the BBC that while it was policy for now, he could not predict the future.
Nevertheless, the prime minister’s spokesperson added that while the government remained committed to the ban, it did not want to impose measures that were “unfair on the public”.
Ministers are said to be considering whether an “Aston Martin exemption” could be introduced to give smaller car manufacturers more time to switch to electric vehicles.
The housing secretary, Michael Gove, has suggested the government should “relax the pace” on the deadline for landlords in the private rented sector to make energy improvements to their properties, warning against treating the environment “as a religious crusade”.
No 10 said the government was “considering the correct approach” on energy efficiency targets for private rented homes. It said the commitment to phase out gas boilers from 2035 remained but that it was considering “how technology evolves” before the deadline.
Sunak’s spokesperson stressed that low-traffic neighbourhoods must “work for local people” and involve “extensive consultation” following reports they were under threat.
“It’s right to listen to consumers and businesses as we progress towards these commitments and understand their concerns,” he said.
“These are long-term commitments for a problem that has been around for a long time. It is right that we continually examine and scrutinise them to understand if they are proportionate and pragmatic.” | Renewable Energy |
Joe Raedle/Getty Images
toggle caption
A Biden proposal would raise the threshold under which salaried workers are eligible for overtime pay — but it could face opposition from business groups.
Joe Raedle/Getty Images
A Biden proposal would raise the threshold under which salaried workers are eligible for overtime pay — but it could face opposition from business groups.
Joe Raedle/Getty Images
Millions of salaried workers would be newly eligible for overtime pay under a proposal unveiled by the Biden administration Wednesday, but the draft rule is likely to face pushback from business groups that blocked a similar effort under former President Obama.
The proposed rule would raise the threshold under which workers are automatically eligible for overtime pay to about $55,000 a year, from the current level of about $35,000.
Many salaried managers in low-wage industries such as retail and fast food are currently exempt from earning overtime pay, even when they work long hours.
"For over 80 years, a cornerstone of workers' rights in this country is the right to a 40-hour workweek, the promise that you get to go home after 40 hours or you get higher pay for each extra hour that you spend laboring away from your loved ones," said Acting Secretary Julie Su.
The administration estimates the measure would make about 3.6 million salaried workers eligible for time-and-a-half pay.
In the waning days of the Obama administration, the Labor Department ordered a similar increase, boosting the threshold from $23,660 to $47,476. That move was blocked, however, by a federal judge. The Trump administration then crafted its own rule, using the $35,000 threshold that's in place today.
The Biden administration calls for automatically raising the overtime threshold every three years, to keep pace with rising wages.
The National Retail Federation says it's studying the proposed rule, but suggests the increase to a $55,000 threshold is too large.
"The proposed number is significantly higher than the rate of inflation," said David French, the federation's senior vice president of government relations. "Further, the attempt to tie the hands of future administrations through automatic increases exceeds the Department's authority."
The Labor Department is seeking comment on the proposed rule for 60 days. | Workforce / Labor |
Mesh (formerly Front Finance), a startup developing a service to help customers transfer and manage digital assets like crypto, has raised $22 million in a Series A funding round led by Money Forward with participation from Galaxy, Samsung Next, Streamlined Ventures, SNR.VC, Hike VC, Heitner Group, Valon Capital, Florida Funders, Altair Capital, Network VC and various angels.
Mesh will use the new cash, which brings its total raised to date to $32 million, to further develop its tools for deposits, payments and payouts, co-founder and CEO Bam Azizi says, as well support its go-to-market operations.
“Consumers are increasingly focused on digital-first experiences when it comes to their money — whether it’s online banking or a collectible asset,” Azizi told TechCrunch in an email interview. “Mesh is reinventing the connection layer that’s essential to facilitating these digital-first user experiences, giving users the ability to access and move their money on their own terms.”
Mesh, a participant in the Startup Battlefield 200 competition at TC Disrupt 2023, was founded in 2020 by Azizi and Adam Israel. Prior to starting Mesh, Azizi launched the cybersecurity and identity company NoPassword, which LogMeIn acquired in 2019. Israel came from the banking sector, having worked at HSBC as a managing director.
Azizi and Israel spent several years building the core infrastructure for Mesh before rolling it out, alongside the company’s business-to-business offerings, in September 2022, with the goal of making Mesh the “intermediate connection layer” between non-traditional assets.
Businesses can use Mesh to let their customers move assets — including crypto — across different platforms. And users can connect different asset classes and accounts holding those assets with read, write and transfer capabilities to Mesh, having the platform aggregate all of their accounts.
Mesh supports in-app transfers of assets across exchanges and wallets, plus payments and payouts of crypto. Azizi asserts that Mesh doesn’t store users’ personal information or credentials, keeps transfer destinations anonymous from the perspective of external accounts and doesn’t actually touch assets, providing a purely direct account-to-account transfer.
“Mesh’s plug and play solution is particularly compelling for those businesses that want to give more interoperability to their users but are not willing to build the APIs from scratch for every platform,” Azizi said. “We want Mesh to be present in every single transaction that happens in the digital world and make it more secure, compliant and user-friendly.”
Is Mesh more secure, compliant and user-friendly than what’s out there? Perhaps. In any case, Mesh’s sales pitch appears to have won over a respectable number of customers — the company claims to have 70 paying clients across the finance and digital assets industries.
Certainly, it’s a large addressable market. Millions of people globally, including 16% of adult Americans, have purchased digital assets, which reached a market capitalization of $3 trillion globally last November. Investors in Mesh are no doubt angling for a slice of that pie.
“With this recent funding, we are in an incredibly strong place to execute against our long-term vision,” Azizi said. | Crypto Trading & Speculation |
Stocks To Watch: HCLTech, Coal India, JSW Infra, Hindustan Construction, ONGC, Bajaj Group, CAMS, Brigade
Here are the stocks to watch before going into trade today.
HCL Technologies Ltd., Hindustan Construction Co., and Computer Age Management Services Ltd. will be among the major stocks to watch out for on Tuesday.
HCL Technologies is in talks with State Street Corp. to sell its entire 49% equity stake in joint venture State Street HCL Services for $170 million or around Rs 1,417 crore.
Hindustan Construction Co.'s Swiss unit Steiner AG is set to divest its entire stake in Steiner Construction SA for Rs 928 crore.
The promoter entity of Computer Age Management Services sold its 19.8% stake for Rs 2,700 crore via a block trade.
India's benchmark indices ended at a fresh high, gaining 2% for the first time in a year as investors cheered the Bharatiya Janata Party's win in three Hindi heartland states.
The NSE Nifty 50 ended 418.90 points, or 2.07%, higher at 20,686.80, while the S&P BSE Sensex gained 1,383.93 points, or 2.05%, to close at 68,865.12. The BSE Sensex and the NSE Nifty 50 had closed over 2% higher on Nov. 11, 2022 and Dec. 26, 2022, respectively.
Overseas investors remained net buyers of Indian equities for the seventh consecutive session on Monday.
Foreign portfolio investors mopped up stocks worth Rs 2,073.2 crore, while domestic institutional investors stayed net buyers in the last two sessions and bought stocks worth Rs 4,797.1 crore, the NSE data showed.
The Indian rupee weakened 7 paise to close at 83.37 against the U.S. dollar on Monday.
Wall Street kicked off the week with losses, with both stocks and bonds down in a signal that traders’ aggressive pricing of interest rate cuts by the Federal Reserve may have gone too far, Bloomberg reported.
The S&P 500 index and Nasdaq 100 fell by 0.56% and 1.10%, respectively, as on 1:04 p.m. New York time. The Dow Jones Industrial Average fell by 0.21%.
Brent crude was trading 0.41% lower at $78.56 a barrel. Gold was lower by 2.28% at $2,025.00 an ounce.
Stocks To Watch
HCL Technologies: The company is in talks with State Street Corp. to sell its entire 49% equity stake in joint venture State Street HCL Services for $170 million or around Rs 1,417 crore. The amount will be in addition to the JV's net book value.
Coal India: The coal ministry projects total income for the company at Rs 1.41 lakh crore for FY24.
ONGC: The company will start oil production from KG Block in May, a government minister said.
Hindustan Construction: The company's Swiss unit Steiner AG will divest its entire stake in Steiner Construction SA for Rs 928 crore.
Computer Age Management Services: Promoter entity Great Terrain Investment sold its 19.8% stake for Rs 2,700 crore via a block trade.
JSW Infrastructure: The company's wholly owned subsidiary, JSW Dharmatar Port Pvt., has entered into a share purchase agreement to acquire over 50% of PNP Maritime Services Pvt. for Rs 270 crore.
Mahindra & Mahindra Financial Services: Estimated overall disbursement at approximately Rs 5,300 crore in November, delivering a 16% growth over the previous year.'
Thomas Cook (India): The company's promoter entity, Fairbridge Capital (Mauritius) Ltd., reduced its 8.5% stake in the company via an offer for sale.
Bajaj Group: The market capitalisation of Bajaj Group crossed the Rs 10 lakh crore mark on Monday, driven mostly by gains in Bajaj Auto Ltd. and Maharashtra Scooters Ltd.
Brigade Enterprises: Brigade Group signed a joint development agreement to develop luxury residences of around 0.4 million sq. ft. in Mysuru, with a gross development value of Rs 300 crores.
Graphite India: The company acquired a 31% shareholding in Godi India for a cash consideration of Rs 50 crores
TVS Holdings: The company applied for the status of 'core investment company' to the RBI.
Alembic Pharmaceuticals: The company appointed Pradeep Chakravarty w.e.f. Dec. 4 2023, as Head - Global Quality (senior management personnel of the company).
KP Energy: The company was awarded the contract for the development of a 464.10 MW balance of system package for an inter-state transmission system (ISTS) connected wind energy project to be developed in the state of Gujarat by NTPC Renewable Energy Ltd.
Gulshan Polyols: The company received order worth Rs 572 crore to supply Ethanol to OMC. The company will supply 89,404 KL Ethanol to BPCL, IOCL, and HPCL.
Indian Energy Exchange: The company's November volume stood at 9,136 million units, up 17.5% year-on-year. Total electricity volume For November was at 8,371 million unit, up 13% year-on-year.
MOIL: The company's manganese ore production jumped 35% y-o-y to 1.62 lakh MT in November.
DCB Bank: The bank's promoter has expressed its interest to invest up to $10 million by subscribing to additional equity shares of the bank.
KPI Green Energy: The company acquired a 99.90% stake in KPark Sunbeat Pvt. for a cash payment of Rs 2.26 lakh. It allotmented 15.18 Lakh equity shares of the face value of Rs 10 each at an issue price of Rs 830.15 per equity share.
Max Financial Services: Analjit Singh, the founder and chairman of Max Life Insurance Co., has formally stepped down from the position and as a member of the board as of Dec. 4.
Cupid: The company acquired of a new land parcel in an industrial area near Mumbai. Through this, the annual production capacity will be augmented by approximately 770 million male condoms and 75 million female condoms.
Block Deals
Computer Age Management Services: Great Terrain Investment sold 97.59 lakh shares (19.86%) at Rs 2766.47 apiece while India Acorn Icav bought 11 lakh shares (2.24%), Morgan Stanley Asia Singapore Pte. bought 7.61 lakh shares (1.54%), Societe Generale bought 12.11 lakh shares (2.46%), Abu Dhabi Investment Authority bought 4.9 lakh shares (0.99%), Kotak Mahindra Mutual Fund bought 4.88 lakh shares (0.99%) at Rs 2,766 apiece, among others.
Bulk Deals
360 ONE WAM: Nirmal Bhanwarlal Jain sold 50 lakh shares (1.39%) at Rs 600.24 apiece, Madhu N Jain sold 30 lakh shares (0.83%) at Rs 600 apiece and Venkatraman R sold 20 lakh shares (0.55%) at Rs 600.03 apiece. ICICI Prudential Value Discovery Fund bought 35 lakh shares (0.97%) at Rs 600 apiece.
Bharat Wire Ropes: Authum Investment & Infrastructure bought 3.51 lakh shares (0.51%) at Rs 296.74 apiece
MTNL: Giriraj Ratan Damani bought 15 lakh shares (0.23%) at Rs 32.04 apiece.
Paisalo Digital: Silver Stallion bought 23 lakh shares (0.51%) at Rs 94.47 apiece.
Tide Water Oil Co. (India): Standard Greases And Specialities bought 7.63 lakh shares (4.38%) at Rs 1,364.81 apiece. PQR Consultants sold 3.65 lakh shares (2.09%) at Rs 1,353.14 apiece.
Zomato: Alipay Singapore Holding sold 26 lakh shares (3.05%) at Rs 112.7 apiece.
Insider Trades
Thomas Cook: Promoter Fairbridge Capital (Mauritius) sold 4 crore shares between Nov. 30 and Dec. 1.
Bajaj Electricals: Promoter Niraj Holdings bought 4.71 lakh shares on Nov. 23. Promoter Rajivnayan Bajaj A/c Rishab Family Trust sold 4.71 lakh shares on Nov. 23
Jindal Stainless: Promoter JSL Overseas bought 15,425 shares on Dec. 1
Star Cement: Promoter Rajendra Udyog HUF sold 28,364 shares on between Nov. 28 AND Nov. 29.
Pledge Shares
Emami: Promoter Suraj Finvest revoked a pledge of 36 lakh shares on Nov. 30 and promoter Diwakar Finvest created a pledge of 7.5 lakh shares on Nov. 28.
Who’s Meeting Whom
Tips Industries: To meet Investor and analyst on Dec. 6.
Greenlam Industries: To meet Investor and analyst on Dec. 6.
Metro Brands: To meet Investor and analyst on Dec. 6.
Indo Count Industries: To meet Investor and analyst on Dec. 6.
Hindustan Foods: To meet Investor and analyst on Dec. 7 and 8.
Neuland Laboratories: To meet Investor and analyst on Dec. 7.
IFGL Refractories: To meet Investor and analyst on Dec .11 and 12.
Saksoft: To meet Investor and analyst on Dec. 7.
Barbeque-Nation Hospitality: To meet Investor and analyst on Dec. 5.
Page Industries: To meet Investor and analyst on Dec. 8
Thyrocare Technologies: To meet Investor and analyst on Dec. 7.
Trading Tweaks
Price band revised from 10% to 5%: Alkali Metal, Inox Wind Energy.
Price band revised from 20% to 5%: Borosil.
Price band revised from 20% to 10%: Munjal Auto Industries.
Move in ASM Framework: Man Infraconstruction, Wonderla Holidays.
F&O Cues
Nifty December futures fell 2.11% at 20,804.05 at a premium of 117.25 points.
Nifty December futures open interest increased by 5.92% by 11,777 shares.
Nifty Bank December futures increased 3.62% at 46,701.20 at a premium of 269.8 points.
Nifty Bank December futures open interest fell by 1.98% by 2988 shares.
Nifty Options Dec. 7 Expiry: Maximum put open interest at 20500 and maximum call open interest at 21000
Nifty Bank Options Dec. 6 Expiry: Maximum put open interest at 45000 and maximum call open interest at 48,000.
Securities in the ban period: Delta Corp, Indiabulls Housing Finance, India Cements, Zee Entertainment Enterprises. | Stocks Trading & Speculation |
LONDON — British politicians think they know what the people want this weekend — less of the "green crap."
Senior Conservative and Labour politicians have been assuring voters they want to take the edge off a suite of bold policies designed to tackle climate change and pollution after the ailing Conservatives clinched a surprise victory in an outer-London by-election opposing an ultra-low emissions zone (ULEZ), a green tax levied on higher-polluting cars.
Allies of Labour's London Mayor Sadiq Khan, the architect of that expanded ULEZ scheme, made it clear he is in listening mode after last week's election result. City Hall is expected to look at new ways to mitigate the financial impact of the policy. It comes after Labour Party leader Keir Starmer on Friday urged Khan to “reflect” on the impact of the extension of ULEZ into Uxbridge, the former seat of Boris Johnson where the election was held.
Meanwhile, veteran Conservative Cabinet minister Michael Gove, a former environment secretary who was once seen as one of the Conservatives' most vocal green crusaders, told the Sunday Telegraph he wants to relax current plans to bring in stricter minimum energy efficiency standards for landlords by 2028.
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“My own strong view is that we’re asking too much too quickly. We do want to move towards greater energy efficiency, but just at this point, when landlords face so much, I think that we should relax the pace that’s been set for people in the private rented sector, particularly because many of them are currently facing a big capital outlay in order to improve that efficiency,” Gove told the paper.
Gove was former Prime Minister Theresa May's environment secretary when the government enshrined into law a target of eradicating the U.K.'s net contribution to climate change by 2050.
In an interview with the Financial Times, meanwhile, Energy Secretary Grant Shapps said North Sea oil and natural-gas licenses should be granted for all viable oilfields and gasfields, as long as it was consistent with the net-zero ambitions.
It is not the first time Conservative ministers have cooled on green promises in the run-up to an election.
In 2013, Prime Minister David Cameron reportedly ordered aides to get rid of the "green crap" from energy bills in a drive to bring down energy costs. Cameron had made the environment a core election issue in 2010 when he invited people to "vote blue, go green."
The U.K. government has also recently been under pressure from senior Conservatives over former Prime Minister Johnson's pledge to ban the sale of new petrol and diesel cars in the U.K. by 2030.
Asked if the government should drop its commitment, Lee Rowley, a junior minister in Gove's housing department, told GB News: “It's about doing this in a way that works. We've got a target. Let's all go and try and do as much as we can to get there."
But asked about his own driving habits, Rowley said he had a diesel car, bought in 2008, which he would keep going "until it stops working."
Calling for more nuance in the net-zero debate, Rowley said that he hoped people would move to electric cars, but that those with existing cars should hold onto them for as long as possible because of the energy used to create them. | United Kingdom Business & Economics |
- A survey by CNBC and Morning Consult found 92% of Americans are pulling back spending.
- It's further evidence of what retailers like Walmart, Target, Home Depot and Best Buy called out as cautious consumer-spending shifts during the first quarter.
- Among the hardest-hit categories by inflation-fueled spending cuts, clothing came in as the No. 1 nonessential category where consumers have cut back.
Nearly all Americans are cutting back on their spending in some way, according to a new CNBC and Morning Consult survey.
The survey found 92% of Americans are pulling back, further evidence of what retailers like Walmart, Target, Home Depot and Best Buy called out as cautious consumer spending shifts during the first quarter.
Shoppers continue to report inflation squeezing their finances, with concerns particularly heightened among middle-income Americans. Of the survey respondents, 92% of middle-income Americans — or those who make between $50,000 and $100,000 a year — reported being "somewhat" or "very" worried about higher prices.
That's a higher proportion than those in low- and high-income groups, with 88% of each of those segments reporting feeling concerned about higher prices. One somewhat bright spot: That share of high-income households, represented by those earning $100,000 or more a year, represents an improvement from a year ago when 92% expressed concern around inflation, according to the survey.
Over the last six months, higher prices have led nearly 80% of consumers to cut spending on nonessential goods, like entertainment, home decor, clothing, appliances and more, the survey found.
Further, two-thirds of respondents reported spending less on essential items, like groceries, utilities and gas. In the grocery category, more than half of consumers said they're buying cheaper alternatives, like private label brands, or just generally buying less.
"Customers continue to seek value given the impact of inflation," Walmart CEO Doug McMillon said on the retailer's first-quarter earnings call. "Private-brand penetration is up about 110 basis points versus last year for Walmart U.S." A basis point is one-hundredth of a percentage point.
Spending at value-oriented grocery stores in May outpaced spending in the overall grocery segment, according to Bank of America aggregated credit and debit card spending data.
"We think this reflects trade down from higher incomes, in line with commentary from Grocery Outlet and Walmart," Bank of America Securities analyst Robert Ohmes said.
What's more, consumers don't expect to change spending habits for the remainder of the year.
Two-thirds of respondents to the CNBC and Morning Consult survey said they still plan on cutting spending on essential items over the next six months, and 77% plan to slash spending on non-discretionary goods, a percentage only slightly below those who said they have already cut back in that area.
The CNBC and Morning Consult survey was conducted online earlier this month and polled more than 4,400 adults.
Among the hardest-hit categories by inflation-fueled spending cuts, clothing came in as the No. 1 nonessential category where consumers have cut back, with 63% reporting buying less since the beginning of 2023.
Walmart and Target, the nation's largest multi-category retailers, each reported seeing weakness in apparel spending in the first quarter.
While experience-based spending — particularly travel — has held up better than goods purchasing this year, the survey found spending at bars and restaurants was the second most likely nonessential category to see cuts, with 62% reporting spending less.
Monthly aggregate restaurant spending slowed in May from April, according to Bank of America's credit and debit card data. The "fast casual" segment continued its spending slowdown, "casual dining" saw fewer dollars than the month before, and pizza in particular continued to see year-over-year declines.
Spending on entertainment outside of the home, including concerts, has fared slightly better, with 58% of consumers reporting they've cut back there, according to the CNBC-Morning Consult survey.
Meanwhile, more than half of Americans say they've cut back on major household-related spending like renovations or appliances.
"We are seeing more of a 'break, fix, replace' than upgrade [in appliances] and a little sensitivity to these single, larger-priced discretionary items," Home Depot CEO Ted Decker told CNBC ahead of its investor day Tuesday.
And nearly half of survey respondents said they're spending less on electronics like computers and phones. That pullback was even more stark among lower-income Americans, with two-thirds of the group cutting back in the category.
Best Buy CEO Corie Barry said following the company's first-quarter earnings report that customers are making trade-offs.
"Not every industry is seeing the exact same customer behavior because the customer is in control and making trade-off decisions based on how that inflation is affecting them personally," Barry said. | Inflation |
A former Tory minister said families don't have a 'right' to low food prices as she told people to live within their means.
Ann Widdecombe said that people who cannot afford to make a cheese sandwich should not 'do the cheese sandwich'.
Ms Widdecombe, 75, who was a Brexit Party MEP and now backs the Reform Party, made the comments on the BBC's Politics Live programme in a debate about soaring food prices.
The average cost of making a single cheese sandwich at home is now 40p, up 37 per cent in the past year, according to research conducted last month.
The competition watchdog is to investigate whether 'any failure in competition' is leaving consumers paying higher grocery and fuel prices than they should be.
But Ms Widdecombe laid the blame at wage demands being made by public sector workers, although she added that historically supermarkets held the 'whip hand' over producers.
Citing inflation in the 1970s she added: 'We just have to be as grown-up about this as we can and stop thinking it is solely a UK problem, because it isn’t.
'We also just have to learn the lessons of the past, which is that prices follow wages, follow prices, follow wages.'
Presenter Jo Coburn asked: 'What do you say to consumers who literally can’t afford to pay for even some of the basics if they have gone up the way that cheese sandwich has, with all its ingredients?'
She replied: 'Well then you don’t do the cheese sandwich ... because we have been decades without inflation we have come to regard it as some sort of given right that our food doesn’t go up.
'I used to represent a rural constituency, and even then – and I have been retired 13 years – the farmers would complain constantly about the supermarkets, about their demands … about their pricing, and they appeared to hold the whip hand. And that doesn’t appear to have changed.
'The only way this is going to be tackled is if inflation comes down, you will not get inflation coming down while you have inflationary wage rises. And we have got to face that. Some of the wage demands at the moment are utterly unrealistic.
'I lived through the 70s and that is exactly what happened.'
She is the latest political figure to question how hard is it to afford food.
A year ago Ashfield MP Lee Anderson, who earns £84,144 a year as an MP, caused uproar after he claimed that Brits 'can't budget' and there was 'not this massive use for food banks' in Britain.
He also invited opposition MPs to visit a scheme in his constituency that represented 'a real food bank' and allowed people to 'make a meal for about 30p a day'.
It saw his critics dub him '30p Lee'.
Supermarket food basics including meat, yoghurt and vegetables have doubled in price since last year, figures show.
Consumer watchdog Which? urged the Prime Minister to intervene on behalf of struggling shoppers as its latest data shows food inflation remains at 'shockingly high levels'.
The figures come ahead of today's Downing Street 'Farm to Fork Summit', bringing together farmers' representatives and food and retail trade bodies along with supermarket chiefs to talk about the Government's goal of boosting cooperation across the supply chain, the sector's resilience and rampant food inflation.
The Which? analysis of April prices on more than 26,000 food and drink products at Aldi, Asda, Lidl, Morrisons, Ocado, Sainsbury's, Tesco and Waitrose found inflation in categories that have previously seen the highest rises – including milk, butter and bakery items – has eased slightly.
Overall inflation has also started to ease slightly, from 17.2 per cent in March to 17.1 per cent to the end of April, according to the tracker.
Supermarket own-label budget items were up 25 per cent in April on 12 months ago, demonstrating how low-income shoppers are being hit hard by soaring inflation.
Branded goods, meanwhile, showed no change on March, staying at 13.8 per cent higher than last April. Regular own-brand food and premium own-brand food inflation decreased slightly.
The Competition and Markets Authority (CMA) said it had not seen evidence pointing to specific competition concerns in the grocery sector 'at this stage', but it was 'important to be sure that weak competition is not adding to the problems'.
The CMA said: 'Given ongoing concerns about high prices, we are announcing the stepping up of our work in the grocery sector to understand whether any failure in competition is contributing to grocery prices being higher than they would be in a well-functioning market.'
The watchdog said it will assess how competition is working overall in the grocery retail market, and identify which product categories, if any, 'might merit closer examination across the supply chain'. It will provide an update on its work over the coming months.
CMA chief executive Sarah Cardell said: 'Grocery and food shopping are essential purchases.
'We recognise that global factors are behind many of the grocery price increases, and we have seen no evidence at this stage of specific competition problems.
'But, given ongoing concerns about high prices, we are stepping up our work in the grocery sector to help ensure competition is working well and people can exercise choice with confidence.'
Why are food prices rising in the UK? Cost of meat, yoghurt and vegetables double - here's what you need to know
Supermarket food basics including some meat, yoghurt and vegetables have doubled in price since last year, figures show.
Consumer watchdog Which? urged the Prime Minister to intervene on behalf of struggling shoppers as its latest data shows food inflation remaining at 'shockingly high levels'.
So, why are food prices rising in the UK? Will food prices go down any time soon?
Here is everything you need to know about the rise of food prices in the UK.
Food producers have been forced to increase their prices due to the rate of inflation, which has seen brands increase the cost of items such as meat, yoghurt and vegetables, which have doubled in price.
The UK minimum wage has also played a factor in the rise in food prices. It has risen from £6.70 in 2015 to £10.42 as of April 2023.
Supermarket own-label budget items were up 25 per cent in April 2023 compared to April 2022, hitting low-income shoppers hard.
Branded goods, meanwhile, did not change in price in March 2023, staying at 13.8 per cent higher than April 2022. Regular own-brand food and premium own-brand food inflation decreased slightly.
Rebecca Tobi, senior business and investor engagement manager at The Food Foundation, said: 'We know that the current food price crisis is causing a great many households to cut back on essentials.
'With levels of food poverty among children having doubled in the year to January 2023, government and businesses must act urgently to ensure that everyone can afford and access healthy essentials like fruit and vegetables.
'If not, we will be seeing the long-term health and economic consequences of the cost of living crisis playing out for years to come.'
As countries imposed lockdowns and people were forced to stay at home from early 2020, many chose to stockpile essentials, such as toilet paper and masks, resulting in a shortage of items due to unprecedented demand.
Following the initial onset of the pandemic, food prices rose consistently in the 17 months up to December 2022.
Figures from the Office for National Statistics show that, in December 2022, food price inflation was at its highest since September 1977 when, according to ONS estimates, the rate was 17.6 per cent.
So while Covid did not directly affect the dramatic rise in food prices, it played a part in price hikes due to an increased demand for goods.
Does the war in Ukraine affect food prices?
Following the devastating impact of coronavirus, global supply chains were under significant pressure before the war in Ukraine.
The conflict in Ukraine has added to food supply chain pressures, with trade supply issues and a disruption to the supply of fertiliser resulting in a hike in food prices across the UK's supermarkets.
Minette Batters, president of the National Farmers' Union (NFU) told Sky News: 'There's a real challenge when you look at what has happened.
'We have had the most affordable food in Europe for a very long time, and we still do have the most affordable food here per income spend and we're the third most affordable in the entire world.
'That's really good for consumers, but these costs, this war in Ukraine is a game changer.
Will UK food prices go down?
Consumer watchdog Which? has urged the Prime Minister to intervene on behalf of struggling shoppers as its latest data shows food inflation remaining at 'shockingly high levels'.
At Asda, the price of Morliny Frankfurters (350g) has increased from £1.25 a year ago to £2.42 now – a rise of 93.8 per cent.
A pack of four brown onions at Morrisons went from 65p to £1.24, a 90.8 per cent rise over 12 months.
Also at Morrisons, Lancashire Farm Natural Bio Yoghurt 1kg went up from £1.18 to £2.18 over the year, a rise of 85.3 per cent.
Although prices on products such as juice, chocolate, water, fish, chilled ready meals and cheese have increased, inflation on other products was found to have reduced slightly.
Price hikes on milk, butters, spreads and bakery items has eased slightly, as overall inflation decrease from 17.2 per cent in March 2023 to 17.1 per cent in April 2023, according to analysis by Which?
Sue Davies, Which? head of food policy, said: 'It's very alarming to see products such as meat, cheese and vegetables that people rely on still rapidly soaring in price.
'Supermarkets must also provide transparent pricing so people can easily work out which products offer the best value.'
What is the best way to save money on food?
Amid the soaring cost of living, shoppers will be looking to save money on their food shop wherever possible.
Low-cost supermarket chains Aldi and Lidl are renowned for having the best-value prices when it comes to food and drink, but customers should compare prices at different brands to see where their shop works out cheapest.
Using loyalty cards such as the Tesco Clubcard, as well as Sainsbury's recently introduced Nectar Prices scheme, can help customers save on items that chains have chosen to offer discounts on.
Cooking meals in batches - rather than doing so individually - will not only save you time in the kitchen, but can make your money go further too. | Inflation |
We've been taught to expect the unexpected, and when it comes to finances, the best way to do that is with an emergency fund.An emergency fund contains cash for unforeseen moments "that throw your life into financial uncertainty and disarray," said Rebecca Jarvis, ABC News' chief business and economics correspondent. These could include a death in the family, a debilitating illness, a divorce or a job loss."Life is full of surprises and sometimes they have a giant price tag," Jarvis said.How much should you save in your emergency fund?Jarvis points out that emergency funds should be for "hurricanes" as opposed to "rainy day" inconveniences such as car repairs or broken appliances or phones."You want to look at your weekly budget -- how much are you spending on food and groceries? What is the cost of electricity and utilities? How much do you have to pay for rent or your mortgage? These are all necessities, things that you would have to make payments on in order to keep the status quo," Jarvis said.She recommends building up six months' worth of these expenses for your emergency fund."But if you can't get there right away, at least [try to] have three months worth of savings to cover all the necessities," Jarvis said, noting that if you have children or job instability, you may eventually wish to save a larger padding.If that total is a challenge, "it can be helpful to start with a smaller number, like $500, which can still be crucial in getting you through a difficult time," said Kimberly Palmer, a personal finance expert at NerdWallet, who shared a calculator that can help determine an amount you can strive to reach."The goal here is to give yourself that cushion so that you're not shouldering the financial burden, along with the emotional burden, of these major lifestyle changes," Jarvis said."Knowing that the money is there if you need it creates a peace of mind and a freedom to live in the present and not be thinking constantly about what happens in the future if you don't have this safety net," she said.Where to put your money and how to saveEven though your emergency fund is a last resort, that money should be ready to deploy at a moment's notice, Jarvis said.A savings account or a money market fund are options to contain your emergency fund, as are CDs, 401(k)s or even IRAs, but some of these can have fees associated with them for early withdrawals.As far as contributing toward your emergency fund, Jarvis suggests making it a part of your budget."Give a little to that emergency fund every week, every month, until you get to the point where you have those six months of savings on hand," she said, further suggesting tracking and celebrating your progress along the way.And if you're carrying a lot of debt, Jarvis recommends building your emergency savings, even if you have to scale back on debt payments."You should be building out that emergency fund before you build out anything else, because it is going to be the underpinnings of having some degree of security and knowing that if the unforeseen crops up, you have the ability to take care of yourself and your family," she said."Having that emergency savings fund can help prevent you from accruing even more debt if you face an unexpected emergency," Palmer added."If you don't have an emergency savings fund or you've depleted your emergency savings fund, create that line item, that small amount in your budget where you are consistently setting a little bit of money aside so that when and if you need it again in the future, you have it," Jarvis said.Additionally, Palmer suggests taking a look at your spending on "wants" each month, which can include eating out, subscriptions, clothing, etc."If you can cut back on those categories and redirect the money into savings instead, it can be a great way to build up your emergency fund," she said, noting the 50/30/20 budget plan to assess and reallocate your funds.Protect your hard work"In general, you should keep your emergency fund for true emergencies and have other [long-term and short-term] savings accounts for other goals, such as vacations or big purchases," Palmer said. "Keeping it in a savings account designated for emergencies instead of your daily checking account can be one way to help keep it separate."And also make sure you're assessing "emergencies" with a clear head."Here's a good barometer: Consider whether you actually need something to survive. If you don't, it's not an emergency," Jarvis said."Building an emergency savings takes work and the last thing you want is to undo all of that hard work with a decision on the fly," Jarvis added. "Going on a cruise is not an emergency."Editor's note: This was originally published on Jan. 18, 2021. | Personal Finance & Financial Education |
Fans of Dame Esther Rantzen have offered their condolences after the broadcaster revealed she has been diagnosed with lung cancer.The 82-year-old founder of charities Childline and The Silver Line, confirmed the news on Sunday.Fans took to Twitter to share an outpouring of sorrow and praise for Dame Esther, calling her a 'living legend' and admiring her 'positive attitude'.Cancer battle: Fans of Dame Esther Rantzen have offered their condolences after the broadcaster revealed she has been diagnosed with lung cancerOne said: 'Dame Esther Rantzen is more than a living legend. She is such an amazing force for good. 'My thoughts & prayers are with her & I wish her all the best for a speedy recovery. We need Fabulous people like her.'Another echoed: 'Wishing Esther Rantzen every success with her cancer treatment. She is a living legend and has helped so many in her long and varied career. All the best, you're in my prayers x'.A third agreed, writing: 'Very sad news about Esther. Her statement is typically thoughtful & humorous. Humorous despite challenging times she is facing. Sad: The 82-year-old founder of charities Childline and The Silver Line, confirmed the news on Sunday'I wish her & her family well. And thank her for her activism shining a light on the vulnerable & otherwise unheard, young & old'.While a fourth added: 'Very sad but an admirably positive attitude from Esther Rantzen'.And a fifth wrote: 'Very sad to hear the news about Dame Esther Rantzen, the founder of @TheSilverLineUK. Wishing her all the best as she receives treatment.' High praise: Fans took to Twitter to share an outpouring of sorrow and praise for Dame Esther, calling her a 'living legend' and admiring her 'positive attitude'Dame Esther said in a statement to the PA news agency: 'In the last few weeks I have discovered that I am suffering from lung cancer which has now spread.''At the moment I am undergoing various tests, to assess the best treatment.She added that after having to don disguises during her trips to hospital for tests she has decided to go public.'I have decided not to keep this secret any more because I find it difficult to skulk around various hospitals wearing an unconvincing disguise, and because I would rather you heard the facts from me,' she explained.Esther continued by thanking her family, friends and colleagues 'who have made my life so joyful.' Thankful: Esther continued by thanking her family, friends and colleagues 'who have made my life so joyful,' including her three children Miriam, Rebecca and Joshua 'who have been the most wonderful support' (pictured with daughter Rebecca Wilcox in 2017)'At the age of 82, this diagnosis has prompted me to look back over the years, and I want to express my profound thanks to everyone who has made my life so joyful, filled with fun, and with inspiration.'First and foremost my family. My three children Miriam, Rebecca and Joshua have been the most wonderful support, company, and source of love and laughter and I am deeply grateful to them.'My friends have been amazing and have created memories which sustain me and give me strength.'My colleagues with whom I have worked, and continue to work with in broadcasting, journalism, the voluntary sector, and in many other organisations have been a constant pleasure, and have amazed me with their tolerance of my wild ideas and awful jokes. TV career: Dame Esther, who was a trailblazer for female broadcasters, became a household name during her BBC career (pictured on That's Life! which she fronted from 1973 to 1994)'I have been continuously inspired by the courageous children, older people and viewers who have trusted me with their life stories. I have always tried to live up to that trust.'As I am sure you will understand, while I am awaiting the results of the tests, I am unable to answer questions. Thanks to the extraordinary skills of the medical profession there are wonderful new treatments, so I am remaining optimistic.' Dame Esther, who was a trailblazer for female broadcasters, became a household name during her career at the BBC.She is best-known for presenting That's Life! – a programme featuring a mix of investigations, topical issues and entertainment – from 1973 to 1994.More recently she has fronted the 2018 Channel 5 consumer advice show Esther Rantzen’s House Trap, and made a 2021 film for the channel entitled Living With Grief. Loss: Dame Esther's documentary maker husband Desmond Wilcox died in 2000, something she has admitted struggling to come to terms with (pictured together renewing their vows in 1999)In addition to her success as a journalist and broadcaster, Dame Esther is also the founder of children's charity Childline, which she established in 1986.NSPCC’s CEO Sir Peter Wanless said in response to the news on Sunday: 'I speak on behalf of Childline’s volunteers, staff and supporters in sending love and best wishes to Dame Esther Rantzen and her family.'Esther’s tireless commitment to Childline and the wider NSPCC over the years is truly inspiring and the positive impact that’s she had on children’s live is unimaginable.''No matter what, she has always been here for children and young people and likewise, we are here to support her during this challenging time.' Children: Dame Esther is mother to Emily, Josua and Rebecca and has five grandchildren Benji, nine, Xander and Teddy seven, and Florence and Romilly, four (pictured with her husband and children in 1986)In 2012, Dame Esther helped create The Silver Line, a confidential helpline designed to combat loneliness for older people's.During the global pandemic, the star warned that lockdown restrictions had created a daily battle against isolation and loneliness for pensioners, campaigning on behalf of the vulnerable.She regularly wrote about her own experience of being unable to see her five grandchildren Benji, nine, Xander and Teddy seven, and Florence and Romilly, four.Dame Esther's documentary maker husband Desmond Wilcox died in 2000, something she has admitted struggling to come to terms with. The broadcaster and activist received a Damehood for services to children and older people in the 2015 New Years Honours List. Campaigner: She received a Damehood for services to children and older people in 2015 (pictured 2017 with King Charles at a reception to mark The Duchess of Cornwall's 70th) | Nonprofit, Charities, & Fundraising |
SHANGHAI/SINGAPORE, June 20 (Reuters) - China cut its lending benchmarks on Tuesday in the first such easing in 10 months, as authorities seek to shore up a slowing recovery in the world's second-largest economy, with more stimulus expected.
The latest monetary easing comes as China's post-pandemic recovery shows signs of losing steam after some initial momentum in the first quarter of this year.
The one-year loan prime rate (LPR) was lowered by 10 basis points to 3.55%, while the five-year LPR was cut by the same margin to 4.20% from 4.30%.
A Reuters poll of 32 market participants showed all respondents expected reductions to both rates.
The People's Bank of China (PBOC) lowered short- and medium-term policy rates last week, signalling it is about to embark on another round of loosening in monetary settings in a push to rev up the recovery.
The medium-term lending facility (MLF) rate serves as a guide to the LPR and markets mostly see the medium-term rate as a precursor to any changes to the lending benchmarks.
"These cuts will lower the cost of new loans, as well as interest payments on existing loans," said Julian Evans-Pritchard, head of China economics at Capital Economics.
"That should offer some modest support to economic activity. But we think it is unlikely to drive a sharp acceleration in credit growth, given weak credit demand."
China's cabinet met on Friday to discuss measures to spur growth in the economy and pledged more policy support.
"More policy measures may be rolled out separately, including but not limited to a 25 basis point cumulative cut to the LPR by the year-end, and property-easing measures to cut payment ratios or mortgage rates, as well as some form of consumption support," analysts at BofA global research said in a note.
"Such marginal easing will probably help prevent growth from slowing sharply, but will unlikely offer a strong boost to reverse the growth slippage in the near future," they said, downgrading their forecasts for China's economic growth outlook for this year to 5.7% from 6.3% previously.
Several global investment banks cut their 2023 gross domestic product growth forecasts for China after May data showed the recovery was faltering.
The LPR, which banks normally charge their best clients, is set by 18 designated commercial banks who submit proposed rates to the central bank every month.
Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages. China last cut both LPRs in August 2022 to boost the economy.
Our Standards: The Thomson Reuters Trust Principles. | Asia Business & Economics |
Macrotech Developers Shares Hit Record High On Plans To Trim Debt
The company's target is to reduce debt to below Rs 6,000 crore by the end of this fiscal year, said CEO Abhishek Lodha.
Shares of Macrotech Developers Ltd. hit a record high during early trade on Tuesday after its top management told a local newswire that the company plans to trim net debt below Rs 6,000 crore by March.
However, share prices fell by late morning after having surged continuously since Nov. 21, giving a return of 6.7%.
"We have reduced our net debt by about Rs 540 crore in the second quarter of this fiscal to Rs 6,730 crore. Our target would be to reduce debt to below Rs 6,000 crore by the end of this fiscal year," Macrotech Developers Managing Director and Chief Executive Officer Abhishek Lodha told PTI.
Shares of the company rose as much as 2.9% to Rs 917 apiece, its highest level. It, however, fell by late morning to trade 1.5% lower at Rs 889.95 apiece as of 10:05 a.m. This compares to a 0.1% advance in the NSE Nifty 50 Index.
It has risen 63% on a year-to-date basis. Total traded volume so far in the day stood at 2.5 times its 30-day average. The relative strength index was at 67.9.
Out of 18 analysts tracking the company, 11 maintain a 'buy' rating, five recommend a 'hold,' and two suggest 'sell', according to Bloomberg data. The average 12-month consensus price target implies an downside of 6.6%. | Stocks Trading & Speculation |
Bitcoin and Ether fell on Thursday morning in Asia, along with other top 10 non-stablecoin cryptos. Bitcoin briefly dipped below $28,500, while Ether’s losses took it below the psychologically important $1,800 threshold. Smaller altcoins such as Dogecoin, Solana and Ripple suffered the biggest drops. In more bullish news, Coinbase Global received approval to offer crypto futures to U.S. retail investors. The Forkast 500 NFT Index was down, although market sentiment remains positive amid a prolonged increase in global transactions. U.S. equity futures traded mixed after another day of losses Wednesday. The release of the minutes for July’s Federal Reserve meeting on interest rates has cast a shadow over equities, the mood music now suggesting a prolonged period of elevated rates or even another hike.
Another down day for crypto
Bitcoin fell 0.95% in the last 24 hours to US$28,551.83 as of 9:00 a.m. in Hong Kong, after briefly falling below the $28,500 threshold earlier in the morning. The largest crypto by market capitalization logged a weekly loss of 3.51%, according to CoinMarketCap data.
Ether also lost 1.80% to US$1,794.91 — below the psychologically important $1,800 level — for a 3.28% drop in the past seven days.
All other top 10 non-stablecoin cryptocurrencies were down. Dogecoin was the biggest loser among the top 10, dropping 5.01% to US$0.06731 for a weekly loss of 10.07%. Solana followed in terms of losses, dipping 4.25% to US$22.83. The token fell 5.98% in the past week.
“Larger currencies have seen less pressure than smaller altcoins,” wrote Alex Kuptsikevich, senior market analyst at London-based online brokerage FxPro, in an emailed statement.
“Rising U.S. Treasury yields put pressure on riskier assets,” Kuptsikevich explained.
The losses arrive in the midst of more positive news for the crypto market.
On Wednesday, Coinbase Global — the largest cryptocurrency exchange in the U.S. — announced that it has received approval from the National Futures Association to offer crypto futures to U.S. retail investors. Previously, only institutional customers could trade crypto futures on the platform.
Coinbase called it a “watershed moment,” celebrating the win despite facing securities violation charges from the U.S. Securities and Exchange Commission (SEC).
Major moment for crypto regulatory clarity in the U.S.
This has been a multi-year process toward approval, and we're excited to finally be launching federally regulated crypto derivatives with margin to our U.S. customers.
When there is a clear path to register, we do. https://t.co/TxSOAIpoPj
— Brian Armstrong 🛡️ (@brian_armstrong) August 16, 2023
“They now have an approved, compliant [Futures Commission Merchant status] and they understand the nuances of crypto markets,” wrote Chris Perkins, president and managing partner at New York-based investment advisor CoinFund.
“It’s an important step forward in cultivating deep, liquid derivative markets — which are very much needed. This should be very good for Coinbase, and excellent for crypto markets,” Perkins added.
Ripple’s XRP token also lost 3.66% to US$0.5862, posting a weekly loss of 8.08%. On July 13, Ripple appeared to score a victory in its ongoing legal battle with the SEC. A New York court ruled that the sale of XRP on public exchanges does not violate securities laws.
However, that aspect of the case is again under scrutiny as, on Aug. 9, the SEC asked for a review of the ruling — contributing to the downward pressure on XRP’s price.
The total crypto market capitalization moved down 1.47% in the past 24 hours to US$1.14 trillion, while trading volume rose 13.64% to US$33.76 billion. | Crypto Trading & Speculation |
Ashoka Buildcon Q2 Results Review - Light At The End Of Tunnel: IDBI Capital
We note that Ashoka Buildcon is witnessing stability in Ebitda margin at 9% which has been major concern in the last four quarter.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
IDBI Capital Report
Ashoka Buildcon Ltd. Q2 FY24 profit after tax beat our/consensus estimate by 9%/22% and is led by execution and improved margin. We note that Ashoka Buildcon is witnessing stability in Ebitda margin at 9%, which has been major concern in the last four quarter.
Low margin legacy projects are getting completed by Q4 FY24, and thus we see that margins to increase to 10.5% starting Q1 FY25. Post the result, we have increased margin estimate for FY24E/25E and thus earning per share is revised upwards by 2% and 6% for FY24 and FY25E.
We have revised exit multiple on the stock to eight times for engineering, procurement and construction and target price is revised to Rs 191 (earlier Rs 93). With potential upside of 36%, we upgrade the stock rating to 'Buy' from 'Hold'.
Ashoka Buildcon stock catalyst, which is key for its stock performance is conclusion of asset sale – National Investment and Infrastructure Fund and 11 hybrid annuity model.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner. | Stocks Trading & Speculation |
Armando Bordalo e Sá planned ahead before coming to London for a five-day trip this summer, exchanging euros for sterling at a good rate to pay for meals, tickets to events and other expenses.
But by the end of his short trip, much of it went unused, because so many places no longer accept cash, and he had racked up a series of unwanted charges from his bank in Portugal.
The UK’s rapid shift towards a cashless society ended up costing the 72-year-old from Lisbon dearly. When he tried to charge his Oyster card, his only option was to use a debit card, while the shops at Tate Britain and a number of other museums were cashless. When he tried to buy an £8 adapter from the vending machine of his hotel, it was card-only.
Returning to Portugal, he found his bank had charged him a 4% fee for “international services”, as well as additional taxes on any debit card transactions he had made because he was unable to use cash – adding up to €85 (£73).
It was a frustrating additional bill when he had money on him to pay. “I was only able to use currency at the restaurants, pubs and taxis,” he says. “It is indeed a fine way for banks to profit.”
Britain has been at the forefront of the switch to a cashless society – a trend which is even more pronounced in the capital, especially since the pandemic.
Figures from banking body UK Finance show that almost half of all payments were made with debit cards in 2021, with newer ways of paying set to almost completely eclipse cash within a decade. “We expect usage to continue to fall, with cash forecast to account for only 6% of all payments made in the UK by 2031,” it says.
But with the shift has come growing concern about groups who still want to use cash – including many older people, those on low incomes and people who want to keep tight control over spending.
But others, such as tourists, have also emerged as wanting a system where both cash and cards are accepted.
The Federation of Small Businesses says there are many like Bordalo e Sá who want to try to avoid charges added by banks.
“They don’t have the luxury of shopping online and, in any case, the allure of hand-picking souvenirs in store offers a personalised touch to their travels,” says FSB national chair Martin McTague. “Phasing out cash and eliminating tax-free shopping sends the wrong message about our readiness for business, and dampens visitors’ spending enthusiasm.”
Cash costs more
One of the problems with the shift towards a cashless society, according to critics, has been that it costs more for people who have to pay cash to do what they want to do. In the case of the Portuguese tourist, that price was £73.
Sian Williams, vice-chair of the Financial Inclusion Commission, says that taking part in activities important to you costs more. “And that is another aspect of the ‘poverty premium’ for millions of people every day in this country,” she says.
The commission, an independent body of experts, wants cash and access to cash to be preserved for as long as people need it. “We can see that it is a vital payment method for people in a range of vulnerable situations.”
A report last year from the Royal Society of Arts (RSA) found that more than 10 million people in Britain would struggle to live in a cashless society, with many losing control of their finances and seeing debts spiral.
Mark Hall, lead author of the “Cash Census” report, says there is a large group of younger people who like the security of cash. “It was often people on lower incomes, or with less stable incomes. We heard many say that they like to keep cash to budget because that way they can keep track of it more easily,” he says.
Another group, who had access to debit cards, went back to cash to more carefully monitor what they were spending.
“They weren’t just tapping their phone on a regular basis, and they were able to manage their cashflow more effectively,” says Hall.
Frustated generation
Older people are often highlighted as being prone to isolation in the shift towards the cashless society. In London, where an increasing number of services no longer take cash, many are frustrated, according to charity Age UK.
“In bigger cities, many are falling behind even faster due to the accelerated speed in which many businesses are progressing toward a cash-free model,” says Abigail Wood of Age UK London.
“Older people are constantly telling us how left behind they feel, and how much harder life is when they are unable to use cash.
“Many older people view cash as the most reliable and straightforward way to pay, as well as an effective means of managing their weekly budget when money is extremely tight – as it is for the majority now.”
Another group, “cashless sceptics”, tend to be older and have concerns about fraud and may find technology difficult to use, says Hall.
Keeping access
The UK is leading the shift towards a cashless society along with some Scandinavian countries, while Italy and Germany are still high cash users, says Graham Mott of Link, the ATM network.
Figures from the company show withdrawals in some parts of London slumped by 60% in the four years to last May.
There are limitations to how far cashless payments can stretch, however, as online payments can fail, he says. “Most people will go out with some cash, or at least have some at home as a contingency,” he says. “It is important that cash access remains.” | United Kingdom Business & Economics |
Ramaswamy wants to end the H-1B visa program he used 29 times
The GOP candidate pledges to get rid of a the system he calls “indentured servitude.”
GOP candidate Vivek Ramaswamy has vowed to “gut” the system for H-1B temporary worker visas if he wins the White House.
It’s the very system he’s used in the past to hire high-skilled foreign workers for the pharma company that built much of his wealth.
From 2018 through 2023, U.S. Citizenship and Immigration Services approved 29 applications for Ramaswamy’s former company, Roivant Sciences, to hire employees under H-1B visas, which allow U.S. companies to employ foreign workers in tech and other specialized jobs.
Yet, the H-1B system is “bad for everyone involved,” Ramaswamy told POLITICO.
“The lottery system needs to be replaced by actual meritocratic admission. It’s a form of indentured servitude that only accrues to the benefit of the company that sponsored an H-1B immigrant. I’ll gut it,” he said in a statement, adding that the U.S. needs to eliminate chain-based migration.
“The people who come as family members are not the meritocratic immigrants who make skills-based contributions to this country.”
Ramaswamy stepped down as chief executive officer of Roivant in February 2021, but remained the chair of the company’s board of directors until February this year when he announced his presidential campaign. As of March 31, the company and its subsidiaries had 904 full-time employees, including 825 in the U.S., according to its SEC filings.
When asked about the mismatch in the GOP presidential hopeful’s policy stance and his past business practices, press secretary Tricia McLaughlin said the role of a policymaker “is to do what’s right for a country overall: the system is broken and needs to be fixed.”
“Vivek believes that regulations overseeing the U.S. energy sector are badly broken, but he still uses water and electricity,” she said in a statement. “This is the same.”
Ramaswamy, who is himself the child of immigrants, has captured headlines for his restrictionist immigration policy agenda.
While not new to the GOP playbook, his rhetoric has at times gone farther than the other candidates, as he calls for lottery-based visas, such as the H-1B worker visas, to be replaced with “meritocratic” admission. He’s also said he’d use military force to secure the border, and that he would deport U.S.-born children of undocumented immigrants.
H-1B visas are highly sought after, and the demand for these workers continues to increase: For fiscal year 2021, U.S. businesses submitted 780,884 applications for just 85,000 available slots, jumping by more than 60 percent.
Ramaswamy acknowledged his own experience with immigration during his opening remarks at the first GOP debate in Milwaukee.
“My parents came to this country with no money 40 years ago,” he said. “I have gone on to found multi billion-dollar companies.”
Ramaswamy’s stance on H-1B visas is reminiscent of the 2016 Trump campaign, when then-candidate Donald Trump, who has also hired a number of foreign workers under H-1B visas for his businesses, took a hardline stance on these foreign workers before later softening his rhetoric.
As president, Trump temporarily suspended new work visas and blocked hundreds of thousands of foreign workers from U.S. employment, as part of his sweeping effort to limit the number of immigrants coming into the United States. | Workforce / Labor |
Voters will not accept “economic destruction” to achieve net zero, one of Britain’s biggest unions has warned Sir Keir Starmer.
Gary Smith, the general secretary of the GMB union, said a rush to abandon oil and gas would be “a disaster” and urged the Labour leader to rethink his green objectives.
The debate around net zero, which Britain is legally obliged to reach by 2050, has intensified after last month’s surprise Tory victory in the Uxbridge by-election last month. Labour blamed its defeat on a backlash against the expansion of London’s Ulez scheme.
However, Sir Keir’s party still plans to place its decarbonisation agenda at the heart of its offering at the next election, with its multi-billion pound Green Prosperity Plan designed to mimic Joe Biden’s big spending on environmental policies.
Warning that politicians had displayed “dishonesty” about the costs of hitting climate targets, Mr Smith suggested Labour risks throwing away its double-digit poll lead if it does not strike the right tone on the issue.
“The danger is if they get the discussion wrong on oil and gas and how we heat our homes and how we power industry, it becomes Ulez on steroids,” he told the Sunday Express.
“I think Labour got it wrong [in Uxbridge]. I think it was ill-thought through what they said, and I hope their position is changing as they face up to the realities of the complexities and challenges of net zero. If politicians don’t listen, don’t take people with them, there will be a backlash and it will be to the Right.”
Reform UK, the Right-wing party led by Richard Tice, has called for a referendum on the 2050 net zero target. A number of Conservative backbenchers echoed the call last week, but the idea was rejected by Rishi Sunak.
In a broadside at Sir Keir’s plans to ban the granting of new licences to explore oil and gas fields in the North Sea, Mr Smith added: “Allowing oil and gas to wither will be a disaster for national security.
“I think there has been a fundamental dishonesty at the heart of our politics about how complex energy is and about how costly any transition is going to be. People are not going to tolerate economic destruction to try to achieve net zero.”
Sir Keir has sought to moderate Labour’s image on environmental issues in the wake of disruptive high-profile stunts by climate campaigners including Greenpeace and Just Stop Oil in recent weeks.
Writing for The Times earlier this month, he described the demands of Just Stop Oil as “contemptible” and insisted he would work with oil and gas giants to secure a managed transition to net zero based on investment in newer technologies such as carbon capture.
The Conservatives have sought to exploit the political divide, with Grant Shapps, the Energy Security Secretary, claiming Labour’s strategy would cause blackouts, while Mr Sunak has pledged to achieve net zero in a “proportionate and pragmatic” way. | Energy & Natural Resources |
Wework To Enter Chapter 11 Bankruptcy As Soon As Next Week
WeWork Inc. is preparing to file for bankruptcy as soon as next week, according to people with knowledge of the matter.
(Bloomberg) -- WeWork Inc. is preparing to file for bankruptcy as soon as next week, according to people with knowledge of the matter.
The co-working company plans to seek Chapter 11 protection in New Jersey, said the people, who asked not to be identified because discussions are private. Talks are ongoing and plans could change, the people added.
Chapter 11 bankruptcy allows a company to keep operating while it works out a plan to repay its debts. It also opens up a basket of legal tools that can aid in a turnaround, like abandoning pricey leases.
A WeWork spokesperson declined to comment. The Wall Street Journal earlier reported on the timing of the filing.
WeWork skipped interest payments on some bonds at the beginning of the month and on Tuesday disclosed a seven-day forbearance agreement with noteholders after an earlier grace period expired. It also said it would not make a $6.4 million payment due Wednesday on a separate bond.
Previously: WeWork Backers King Street, SoftBank at Odds Over Restructuring
The company and its backers, including SoftBank Group Corp. and bondholders including King Street Capital Management, have been locked in discussions over who will take the keys to the firm as part of its latest restructuring, Bloomberg previously reported.
WeWork’s potential bankruptcy caps a rapid downfall for the firm, which in March struck a deal to slash $1.5 billion of debt in an out-of-court restructuring. As of June 30, the company had $2.9 billion of long-term borrowings, along with more than $13 billion of long-term lease obligations.
WeWork shares plunged more than 50% Wednesday morning to trade as low as $1.05. The stock has lost 98% of its value this year.
(Updates with share price in final paragraph.)
©2023 Bloomberg L.P. | Banking & Finance |
November 27, 2023 - On Oct. 8, 2023, California Governor Gavin Newsom signed into law Senate Bill 54, titled Fair Investment Practices by Investment Advisers (the "New Diversity Reporting Law"), which requires "venture capital companies" with sufficient ties to California to collect, and annually report, the demographic information of the "founding team members" at the companies they invested in during the prior year.
The New Diversity Reporting Law has been lauded for being a first-of-its-kind attempt to address the inequitable distribution of funding to women- and minority-owned emerging companies and, since over 5,700 venture capital firms have offices in California and venture capital investment deployed in the State far exceeds such deployment in any other State, it is expected to have sweeping consequences for the venture capital industry in the United States.
However, given the broad scope of the New Diversity Reporting Law, it also applies to investment vehicles that are not traditionally thought of as venture capital companies, including private equity funds, co-investment vehicles, family offices, trusts, etc., in certain circumstances.
Broad definition of "covered entities" under the New Diversity Reporting Law
The New Diversity Reporting Law requires "venture capital companies" that qualify as "covered entities" to adhere to the new reporting requirements.
•What is a "venture capital company"? An entity that meets at least one of the following three criteria, (i) on at least one occasion during the annual period commencing with the date of its initial capitalization, and on at least one occasion during each annual period thereafter, at least 50% of its assets (other than short-term investments pending long-term commitment or distribution to investors), valued at cost, are venture capital investments, (ii) qualifies as a "venture capital fund" under the Investment Advisors Act or (iii) qualifies as a "venture capital operating company" under the Employee Retirement Income Security Act.
•What is a "venture capital investment"? An acquisition of securities in an operating company as to which the investment adviser, the entity advised by the investment adviser, or an affiliated person of either has or obtains management rights.
•When does a "venture capital company" qualify as a "covered entity"? If it has sufficient nexus to California and satisfies at least one of the following two criteria, (i) manages assets on behalf of third-party investors (including, but not limited to, investments made on behalf of a state or local retirement or pension system) or (ii) primarily engages in the business of investing in, or providing financing to, startup, early-stage, or emerging growth companies. Nexus can be established by satisfying any of the following criteria: (a) being headquartered in California; (b) having a significant presence or operational office in California; (c) making venture capital investments in businesses that are located in, or have significant operations in, California; or (d) soliciting or receiving investments from a person who is a resident of California.
Reporting requirements under the New Diversity Reporting Law
The New Diversity Reporting Law requires "covered entities" to report, on an annual basis, to the California Civil Rights Department ("CRD"), the aggregate demographic statistics for the "founding team members" at the companies they invested in during the prior year.
Such data will be collected using a standardized survey to be established by the CRD.
•What demographic information is required to be collected and reported? The demographic information to be collected includes gender identity, race, ethnicity, disability status, sexual orientation, veteran status and whether the individual is a resident of the State of California. "Founding team members" are allowed to opt out of the survey but the refusal to participate must also be reported to the CRD on an aggregate and anonymized basis.
•Who qualifies as a "founding team member"? An individual who either (i) owned an initial interest in the business, contributed developmentally and/or conceptually to the business prior to initial shares being issued and was not a passive investor, or (ii) is an officer, manager or person of similar managerial authority in the business.
•What additional information must be reported? The New Diversity Reporting Law also requires "covered entities" to report, on an annual basis for the prior year, (i) the number of "venture capital investments" it made in businesses whose "founding team members" are comprised of primarily "diverse founding team members," as a percentage of the total number of "venture capital investments" during such period, and (ii) the total amount of money it deployed in "venture capital investments" during such period.
•Who is a "diverse founding team member"? Any "founding team member" who self-identifies as any of the following: (i) woman, (ii) nonbinary, (iii) Black, (iv) African American, (v) Hispanic, (vi) Latino/Latina, (vii) Asian, (viii) Pacific Islander, (ix) Native American, (x) Native Hawaiian, (xi) Alaskan Native, (xii) disabled, (xiii) veteran or disabled veteran, (xiv) lesbian, (xv) gay, (xvi) bisexual, (xvii) transgender or (xviii) queer.
•Is reporting publicly disclosed? Yes, the CRD is obligated to publish the reported data in a manner such that it is readily accessible to the public on an aggregate and anonymized basis.
Implementation timeline and potential delays
Reporting obligations under the New Diversity Reporting Law are set to begin on March 1, 2025, with "covered entities" required to report information for investments made during the 2024 calendar year.
However, the timeline for implementation is expected to be delayed. In his signing message, Governor Newsom remarked that the bill "contains problematic provisions and unrealistic timelines that could present barriers to successful implementation and enforcement" and announced that his administration would propose cleanup language as part of his 2024-25 budget, which is typically released on or around January 10 and finalized in the summer. | Banking & Finance |
Morgan Stanley Wealth Business Scrutinized By Fed, WSJ Says
The Fed has been pressing the firm to improve its processes to prevent wealthy international clients from laundering money.
(Bloomberg) -- Morgan Stanley’s wealth management practice is being scrutinized by the Federal Reserve over lapses tied to doing business with rich clients outside the US, according to the Wall Street Journal.
The bank’s top regulator has been pressing the New York-based firm to improve its processes and controls to prevent wealthy international clients from laundering money. Morgan Stanley’s Andy Saperstein, who’s had oversight of the wealth business, has been meeting Fed officials and promising fixes to rectify the shortcomings, the Journal said.
The Fed has been dissatisfied with the measures taken by the bank and has privately reprimanded the firm to express its dissatisfaction with the remediation efforts. Senior executives across Wall Street have described a phase of higher scrutiny from Washington regulators.
Representatives for Morgan Stanley and the Fed declined to comment.
Separately, rival Goldman Sachs Group Inc. has been responding to its own challenges from the Fed and is seeking to hire hundreds of new compliance staff to help address the deficiencies identified by the central bank, Bloomberg has reported.
At Morgan Stanley, the wealth business is the biggest engine at the firm, responsible for almost half the revenue over the last year. Ted Pick is set to become the next chief executive officer starting in January, replacing longtime chief James Gorman, who spearheaded the bank’s wealth management expansion that has reshaped its identity into a global powerhouse in tending to the fortunes of the wealthy.
--With assistance from Katanga Johnson.
©2023 Bloomberg L.P. | Banking & Finance |
The chancellor is expected to announce a cut in National Insurance for millions of workers in his Autumn Statement later on Wednesday.
Jeremy Hunt's mini-budget will also feature a cut to business taxes and tough new benefit sanctions.
He will also unveil measures to boost business investment by £20bn a year in moves to "get Britain growing".
The Institute for Fiscal Studies (IFS) says UK tax levels are at their highest since records began 70 years ago.
Labour's shadow chancellor Rachel Reeves said nothing Mr Hunt says could change the Conservative's "appalling record" on the economy.
Many Conservative MPs are desperate to see the tax burden eased.
Former home secretary Dame Priti Patel told the BBC: "This is a really pivotal moment.
"Successive Conservative governments are known for targeted tax cuts that basically put more money into people's pockets."
And yet Dame Priti and hundreds of her colleagues know people's taxes have shot up and plenty think public services haven't improved to match.
The cost of Covid and the amount paid in interest on the national debt - the highest for decades - is seen by many economists as a key reason for this.
And so the Autumn Statement is Rishi Sunak's latest attempt to seize the political agenda and improve the Conservatives' standing in the opinion polls.
Some details of the Autumn Statement have already been revealed, including a 9.8% increase to the minimum wage minimum wage to £11.44 per hour. The new rate, which comes into force in April, will also be expanded to 21 and 22-year-olds from the first time.
Mr Hunt will also set out details of a £2.5bn overhaul of benefits for people with long-term health conditions or disabilities, or those facing long-term unemployment.
The government has announced plans to make benefit claimants who fail to find work for more than 18 months undertake work experience placement or face losing access to government support.
Stricter penalties will also apply to long-term unemployed people who the government decide are not adequately looking for jobs.
Downing Street did not rule out removing bus passes from people who refuse offers of work, in a briefing to journalists on Tuesday.
For businesses, it is understood the chancellor is set to extend the tax break knows as "full expensing" for businesses through to 2028-29.
The "full capital expensing" policy allows companies to deduct spending on investment from profits, meaning they have to pay lower amounts of corporation tax.
The tax break was due to expire in 2026.
It is not currently clear whether Mr Hunt intends to cut the level or the thresholds of National Insurance (NI) - which went up by 1.25p in the pound in April 2022 and then back to its previous level on 6 November 2022.
For employees under pension age who earn less than £12,570 a year, any move will make no difference, as they pay no NI. The NI rate is 12% on earnings for employees on between £12,570 and £50,268, and 2% on profits above that.
'Reject high tax'
Mr Hunt will say: "Conservatives know that a dynamic economy depends less on the decisions and diktats of ministers than on the energy and enterprise of the British people.
"The Conservatives will reject big government, high spending and high tax because we know that leads to less growth, not more."
He will claim the government will "will back British business with 110 growth measures" including "removing planning red tape", boosting foreign investment and cutting business taxes.
Speaking ahead of the statement, Labour's Rachel Reeves said: "The Conservatives have become the party of high tax because they are the party of low growth.
"After 13 years of economic failure under the Conservatives, working people are worse off.
"Prices are still rising in the shops, energy bills are up and mortgage payments are higher after the Conservatives crashed the economy."
Turning point
With a general election expected next year, the dance in advance of the speech has included the usual nods and winks, briefings and interviews - with no shortage of speculation about a huge range of potential tax cuts, which the Treasury has done little to dampen down.
Until last week, Mr Hunt has downplayed the chances of tax cuts, claiming they were "virtually impossible" until inflation was under control.
Ministers now say tax cuts will happen but claim they will be done in a "responsible" way.
In a speech on Monday, the prime minister made repeated references to tax cuts and claimed last Wednesday's drop in inflation appears to have signalled a turning point for the UK's flatlining economy
Mr Sunak said the government was now able to cut taxes, after the pace of price rises eased.
He said his target of halving inflation this year had been met.
But the new focus - given next-to-no economic growth - is to try to get the economy growing. | United Kingdom Business & Economics |
Rishi Sunak has been criticised after managing to break two of his key pledges on the same morning.
Official figures showed that NHS waiting lists have hit a new record, while the UK economy is shrinking.
In January, the prime minister made cutting waiting lists and growing the economy two of his five “priorities” he wants voters to judge him by.
The other three are reducing the national debt, halving inflation and stopping the small boats carrying migrants across the Channel from France.
According to NHS England, 7.47 million people were waiting to start routine hospital treatment at the end of May, up from 7.42 million in April.
That is the highest number since records began in August 2007.
Meanwhile, the Office for National Statistics revealed that the economy shrank by 0.1% in May.
Lib Dem health spokesperson Daisy Cooper said: “This shows another empty pledge from Rishi Sunak placed on the scrap heap of broken promises.
“More than 1 in 10 people in our country are now waiting for routine hospital treatment, with millions of them now too sick to work.
“Conservative ministers should hang their heads in shame - or better still, step aside.”
Deputy Labour leader Angela Rayner said: “This is a Tory prime minister who can’t even achieve the unambitious goals he set for himself.
“Rishi Sunak is not just failing the British people, he’s failing on his own terms.”
Commenting on the economic figures, shadow chancellor Rachel Reeves said: “Growth is down again, families are worse off and the impact of the Tory mortgage bombshell is reaching far and wide.
“This Tory government seems determined to march us down a path of low growth and economic insecurity.”
Chancellor Jeremy Hunt said high inflation - despite Sunak’s pledge to halve it - was a “drag anchor on the economy”.
He said: “The best way to get growth going again and ease the pressure on families is to bring inflation down as quickly as possible. Our plan will work, but we must stick to it.” | United Kingdom Business & Economics |
NEW YORK -- The Federal Reserve's likely decision Wednesday afternoon to leave interest rates alone for the first time in 11 meetings will raise hopes that it may be nearing the end of its rate-hiking campaign to cool inflation.
That's not to say the Fed is done raising rates. Most economists foresee another increase or two, starting as soon as next month. And even after the Fed has stopped hiking, it's likely to keep borrowing rates at a peak for months to come. Consumers would still have to bear the weight of higher-cost auto loans, mortgages, credit cards and other forms of borrowing.
Still, some people may feel encouraged by the possibility that loan rates are approaching a peak. And in the meantime, people with savings accounts are enjoying higher yields than they have in years. Fortunately, that isn't likely to change anytime soon.
HOW WILL BORROWERS BE AFFECTED BY ALL THIS?
Though the Fed may not have reached the absolute top of its rate-raising cycle, it's getting close. That said, it doesn't mean relief is on the way.
“Even once the Fed stops raising interest rates, borrowing rates are still very, very high,” said Greg McBride, Bankrate.com’s chief financial analyst. “Some of these rates are higher than many consumers have ever seen.”
McBride noted that credit card rates, in particular, are at or near their all-time peaks, mortgage rates have more than doubled in two years and auto loan rates have reached their highest level in about a dozen years. Even if rates were to hold steady, borrowing costs across the economy will remain much higher than they were in recent years. Some consumers may struggle to continue making loan payments on time as they simultaneously face inflated prices for many goods and services.
“That means debt repayment has taken on a renewed urgency,” McBride said. “If you have credit card debt, that is a top priority to get paid down.”
Matt Schulz of LendingTree suggested that consumers who have debt should “assume that rates will continue to rise and focus on paying down their balances as quickly as possible," to err on the safe side.
Card users, he said, might consider asking their issuers to offer a lower Annual Percentage Rate (APR), if possible. In a recent report, LendingTree concluded that a majority of cardholders who had asked their card issuers for a lower rate received one. The average reduction was significant — 6 percentage points.
“It is well worth your time to make that call,” Schulz said.
Right now, the average APR on a new credit card offer is a towering 23.98%, according to LendingTree.
“And they're probably going to still creep higher in the immediate future,” Schulz said, even if the Fed doesn't raise rates Wednesday.
For a typical credit card already in use, the average APR was only slightly lower — 20.92% — according to the latest data from the Fed.
I NEED TO BUY A CAR. WHAT'S THE OUTLOOK FOR AUTO LOANS?
Loan rates for new vehicles have stayed constant for the past few months, at an average of about 7%. That isn't likely to change even with the Fed leaving rates alone for now, said Ivan Drury, senior manager at Edmunds.com. Auto loan rates, Drury said, tend to reflect buyer demand for vehicles more than they do the Fed's interest rate decisions.
Auto sales, while still way below pre-pandemic levels, remain fairly strong, automakers are selling at still-high prices and profits are solid. Unless sales were to slow, companies and dealers won’t likely reduce prices or offer subsidized loan rates.
“Everyone seems too content," Drury said.
With loan rates unlikely either to rise or fall much anytime soon, buyers who absolutely need a vehicle may increasingly come off the sidelines. Autos are generally staying on dealer lots for only 35-40 days before being sold. Until they start sitting for 60 days or more, Drury said, automakers probably won’t cut prices.
New vehicle prices averaged $47,892 in May, 1.3% below the peak in December. Yet any decline has been offset by costlier loan rates, which have surged nearly a half point over the same period.
Prices for used vehicles also dropped somewhat last year but remain comparatively high. The national average in May was $29,387, down about 5% from the May 2022 peak but nearly $9,000 more than the average before the pandemic. (As of May, the average used-vehicle loan rate was about 11%.)
“Make sure your credit is in tip-top shape, shop around for financing and have an offer in your back pocket before you go to the dealership,” said Bankrate's McBride.
WHAT'S LIKELY IN STORE FOR SAVERS?
Ken Tumin, a banking expert and founder of DepositAccounts.com, noted that while yields for savings accounts and certificates of deposit are the highest they’ve been in a decade, the pace of increases is slowing. With the Fed likely nearing the end of rate hiking, any further increases in yields may be comparatively small.
“Banks will have reason to slow their deposit rate increases,” Tumin said.
Still, it's worth noting that these accounts are much more rewarding than they were as recently as a year ago. The average online savings account yield is now 3.98% — up from 3.31% at the start of this year and from 0.73% from a year ago, according to DepositAccounts.com. The average yield on an online one-year CD is 4.86%, up from 4.37% at the start of the year and from 1.49% a year ago.
McBride suggested that consumers comparison-shop to find the best rates on high-yield savings accounts. He noted that online banks, in particular, are paying yields of 5% or better.
“Savings rates are the highest we’ve seen since the financial crisis,” he said. "Banks that need deposits — like online banks — are competing aggressively by paying higher rates.”
By contrast, McBride said, "brick-and-mortar banks, who have a surplus of deposits — their rates reflect that. They will intentionally have lower rates, and some of them have no intention of catching up.”
Overall, he noted, consumers can enjoy savings rates that haven't been this high in 15 years.
“That’s not a bad place to have money parked,” said McBride.
IS THE FED MANAGING TO DEFEAT INFLATION?
The Fed has clearly achieved progress. Inflation, which peaked above 9% last year, is less than half that level now. Yet the latest inflation readings remain well above the Fed's 2% target. Many households are still feeling heavy financial pressure as a result. Reducing inflation back to the Fed's target level will require more time.
“That might mean the Fed is going to have to hold rates higher for longer, and it may even mean boosting rates further in the months ahead,” McBride said.
The central bank has now raised rates at its fastest pace in 40 years.
“That doesn't mean the Fed is going to start cutting rates or that other rate hikes this year are completely out of the question,” said Jacob Channel, senior economist for LendingTree. “It just means they may be willing to hold rates where they are and let the economy continue to settle without more rate-related prodding in the immediate future.”
If the economy does cool, Channel predicts that mortgage rates may end the year closer to 6% than to 7%. (The current national average for a 30-year fixed-rate mortgage is 6.71%, according to Freddie Mac.)
“There's a very significant cumulative impact (of rate hikes), but it doesn't hit all right away,” McBride said. For the Fed to leave rates alone, at least for now, "gives them a little bit of time to evaluate the broader economic and inflationary landscape to see if further rate hikes are warranted.”
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AP Auto Writer Tom Krisher in Detroit contributed to this report.
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The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism. | Interest Rates |
ChatGPT is changing the way people live and work.
From teachers to cybercriminals, it seems everyone is jumping on the artificial intelligence (AI) bandwagon. This is only to be expected when it can answer questions faster than any human and save you the trouble of scouring countless Google search results to find what you’re after. Plus, it’s kind of fun to talk to sometimes.
Some fear A.I. will take over, but I’ve come to think of it more as my super-smart best friend. It helped me plan a prolonged trip to Thailand and settle an argument about why you should eat your sushi with wasabi.
While my past experiences with ChatGPT have been informative and fun, I wanted to take our relationship to the next level. Could ChatGPT help me plan for retirement too?
Why am I asking ChatGPT for retirement advice?
Once upon a time, I worked for Fidelity Investments. Seeing clients struggle to save enough money for retirement showed me just how important it is to start planning for your golden years as soon as possible. Unfortunately, I know many people don’t have access to the financial guidance they need or deserve.
ChatGPT could change this by giving people key retirement advice in an accessible and nonintimidating way. Imagine if you could get every financial question answered for free, all from the comfort of your home.
As a former financial industry professional, I wanted to see how ChatGPT’s advice compares to a human advisor.
For my experiment, I pitted ChatGPT against a real financial advisor, working withThomas Kopelman, a financial planner and cofounder of AllStreetWealth.com and head of community at Wealth.com. I asked Kopelman and ChatGPT the same questions to see how they would compare.
The respective answers each gave were so different, they could have been speaking different languages.
ChatGPT vs. a human financial advisor
I gave ChatGPT and Kopelman a set of hypothetical financial information based on national averages for someone around my age. I chose to use hypotheticals rather than my actual financial picture because everyone’s situation is different, hence why financial advisors emphasize the importance of an individualized approach to planning.
Here’s the scenario I gave ChatGPT and Kopelman:
I’m a 33-year-old living in San Diego. I make an annual net income of $89,000. I have the following assets and liabilities:
- Federal student loans debt of $37,000
- Credit card debt of $7,951
- Savings account with a balance of $11,250
- A 401(k) with $37,200
- Monthly rent of $2,500, including utilities
- Car insurance payment of $60 per month
I would like to buy my first home in the next 5–7 years and plan to replace my car in the next 5–10 years.
Based on this information, I asked: How much money do I need to retire by age 67?
The results
If this were a speed test, ChatGPT would win. It took only a few seconds to walk me through the math for calculating a nest egg. Here’s how ChatGPT crunched my numbers:
Step 1: Determine my net worth
It started by calculating my current net worth by subtracting my liabilities from my assets, which came to $43,450. I’m really not sure why we went through this show-and-tell part because my net worth didn’t factor into the rest of the answer.
Step 2: Calculate estimated retirement expenses
ChatGPT assumed I’d need 80% of my current net income in retirement, a common rule of thumb in the financial industry. When you factor in inflation of 3%, that comes to $197,581.55 in retirement spending per year.
Step 3: Calculate total retirement savings required
It then used the 4% rule, which states that retirees can safely withdraw 4% from their portfolios each year and not run out of money over a 30-year retirement, to calculate the total retirement savings I’d need:
Total retirement savings required = Estimated annual retirement expenses adjusted for inflation / Safe withdrawal rate = $4,939,538.75
How much do I need to save each year for retirement?
Having a massive nest egg to aim for, while daunting, is great. But it’s not so helpful in practice. How do I get to that $4.9 million nest egg from where I am today?
So I asked ChatGPT to translate this into an annual savings goal. This is where things started to derail for ChatGPT and me.
First, it wanted to account for inflation yet again, increasing my total retirement savings required to almost $10.5 million. When I challenged it on this, it flattered my ego: “You are absolutely right, and I apologize for the oversight in my previous response. I made a redundant adjustment for inflation when calculating the total retirement savings required, which led to an incorrect result.”
It then recalculated how much I’d need to save for retirement without re-inflating my numbers, determining I’d need to save $143,883.80 each year to reach my retirement goal.
This is the point when I began to cry tears of despair for the retirement I would never have. It could also have been where my efforts to save for retirement ended in the face of futility, except I refused to believe the math was right.
When I asked ChatGPT how much money I would have in 34 years if I invested $143,883.80 each year at an annual average return of 6%, it came up with nearly $17.7 million.
Plugging the same numbers into the compound interest calculator at Investor.gov gave a similar result of $16.1 million. To get to $4.9 million in 34 years, I’d actually only need to save about $3,650 per month, according to my Investor.gov calculations.
Methinks your math is not so good, ChatGPT.
The human approach
Kopelman took a very different approach to my retirement-planning question. “It’s easy to say, How do I get on track for retirement?” he says. “ChatGPT will find present value and what you need to save” (which it did), but what it’s not factoring in is the intricacies of your situation.
For example, is your $89,000 income going to remain the same throughout your life? Or do you foresee your income increasing over time? Are you planning to buy a $20,000 car or a $60,000 car? Will you make a 20% down payment on your house or put only 5% down and pay the private mortgage insurance (PMI)?
ChatGPT had been so laser-focused on my presenting question that it ignored my homebuying and new-car goal. It didn’t even think to factor in my future Social Security benefit, let alone how when I choose to claim it could impact my retirement.
The problem with using A.I. for financial guidance is that ChatGPT doesn’t know how to ask all the questions, Kopelman says. And even if it can give you a big number to save, it won’t be able to tell you if you should be saving in a pre-tax or after-tax retirement account or how to invest it.
Kopelman says he’ll spend 20 hours working with clients to uncover all these different variables, from learning about their goals and values—how you feel about having debt is as important as how much debt you have—to building a financial plan and tailoring it to fit your individual needs
Financial advisors still beat ChatGPT
Both ChatGPT and a human financial advisor have their strengths. ChatGPT taught me a lot about math—even when it was wrong. I trust it to help me crunch numbers (although I may double-check its math) and perhaps give generic advice like, what are the pros and cons to using a Roth IRA versus a traditional IRA. But for a true financial plan that will help me achieve all my goals, I’m going to a financial advisor.
ChatGPT is like WebMD, says Ken Lotocki, Chief Product Officer at Conquest Planning, an A.I.-based financial planning software. You can put in your symptoms—or financial goals—and ChatGPT will come back with recommendations on what to do, but you should still go see a doctor.
“ChatGPT is going to give you options, not make the decision for you,” he says. “Where a human advisor comes in, similar to a doctor, is [giving advice] unique to you.”
A human advisor can also identify the elements you didn’t think to plug into your ChatGPT equation, but that are still crucial to the question at hand. Kopelman’s questions opened my eyes to just how complex even my basic financial scenario is, and that there is so much more to retirement planning than the size of the nest egg you need.
So, should you use ChatGPT to help plan your retirement?
After this experience, I think the question is not “ChatGPT versus a human advisor,” but rather how to optimize “ChatGPT with a human advisor.”
For example, having a conversation with ChatGPT before meeting with your financial advisor could help you come to the table more prepared. ChatGPT can help you ramp up your financial literacy and determine the right questions to ask a human advisor.
ChatGPT can crunch numbers and gather data more quickly than any human. It has the potential to shave hours off of the financial-planning process by doing all the rudimentary data entry. But as a single resource, ChatGPT leaves a lot to be desired.
It’s important to remember that ChatGPT is based on algorithms and relies on the data sets it has access to, Lotocki says. When answering questions, it’s going to go out to the internet, which can be a scary prospect given the caliber of the information floating around the World Wide Web.
“Can you really trust it’s going to come back with the right answer, or will it come back with a summary of the info and data sets it has access to?” Lotocki says.
This is also only the beginning for A.I. Companies like Conquest Planning are finding ways to make A.I. more applicable and trustworthy in a financial-planning context. In the meantime, it’s probably best to just use ChatGPT for background research, then bring the big questions to a human financial advisor.
EDITORIAL DISCLOSURE: The advice, opinions, or rankings contained in this article are solely those of the Fortune Recommends™ editorial team. This content has not been reviewed or endorsed by any of our affiliate partners or other third parties. | Personal Finance & Financial Education |
It’s not just eggs that have been eye-poppingly expensive due to inflation. The literal bread and butter of the American diet cost much more today than it did just a couple of years ago: The average price of white bread was about 22 percent higher in January than it was two years ago, and flour is up almost 21 percent. Butter cost 31 percent more.
Ordinary Americans have been watching their grocery bills climb to new heights as prices rise on cereals, meat, dairy, fruits, and vegetables — virtually everything we eat. According to the US Department of Agriculture, the price of food for home consumption rose by 11.4 percent last year — the highest yearly percent change since 1974 – and it’s expected to rise by another 8.6 percent in 2023. Compare that to the last two decades, when average year-to-year food price inflation was 2 percent. Consumers are at the limit of what they can afford.
For the most vulnerable families, the squeeze at the grocery store has become that much more dire. A recent survey of American households that receive food stamps conducted by financial software company Propel showed that almost a third were skipping meals, eating less, or relying on food banks as food prices balloon. On March 1, a pandemic boost to the food stamps program ended, and households will now on average have $95 less per month to spend on food.
Food companies say their price increases merely reflect how much their costs have gone up due to “inflationary pressures,” like higher labor costs, transportation delays, and capacity issues, or the higher price of grains and animal feed. Yet inflation in 2022 outpaced the rise in wages in most industries, and the prices of many agricultural commodities have come down.
The eyebrow-raising spikes at the grocery store can only partly be blamed on manufacturers’ higher costs. The inflation narrative offers the perfect jumping-off point for companies to raise prices, and major food manufacturers are taking advantage of the moment to boost their profits.
The proof? Look at just how rich companies have gotten since the start of the pandemic.
Who exactly is making money off your expensive food?
Chances are, you’ve bought a product that the food giant Cargill has had a hand in sourcing or processing, whether it’s wheat, soy, cocoa, feed for livestock, or the meat that ends up in grocery stores and restaurants. In fiscal year 2022, its revenue reached a record $165 billion. A record $6.68 billion of that was profit, double what its profits were in 2020. Its shareholders received $1.21 billion of those profits in dividends — yet another record.
“Corporate profits have hit their highest level ever, and corporate profit margins — how much they’re making on each unit that they’re selling — have hit the highest level in 70 years,” said Chris Becker, senior economist at the Groundwork Collaborative, a progressive economic advocacy organization.
Tyson Foods, the largest meat company in the US, also more than doubled its profits between the first quarter of 2021 and the first quarter of 2022. Packaged foods manufacturer General Mills, which owns a variety of cereal brands as well as food brands like Annie’s, Betty Crocker, Chex, and Bisquick, has raised prices five times since 2021 and indicated another price hike could be coming soon. At the end of last year, its profits were up 97 percent compared to the previous quarter, and up 16 percent annually. Conagra, which owns packaged food brands like Healthy Choice, Duncan Hines, and Reddi-wip, noted a 22 percent profit increase in its last quarterly earnings report. Grocery giant Walmart — the largest US corporation, bar none — has seen its profits grow for the past several years, with a 7 percent jump between 2020 and 2021.
It’s not just companies growing richer. Food billionaires — the people at the top of the food chain at many of these companies — have grown exponentially wealthier, too.
The seven billionaire members of the Walton family, which owns Walmart, have a combined net worth of $238 billion, according to a recent Oxfam report, and their wealth increased by $8.8 billion between 2020 and 2022.
For the past few years, Oxfam’s annual reports on global inequality have emphasized the windfall profits that food corporations and the individuals who run them have made during the pandemic. The Cargills, some of the food industry’s most powerful players, are a very good example. Almost 90 percent of their namesake food and commodities trading company is owned by family members, who have all been enriched thanks to their stake in the largest privately held company in the US.
Today, there are four more billionaires in the Cargill family than there were in 2020, bringing the tally up to 12 billionaire heirs.
The Mars family, whose company makes candy (3 Musketeers, Skittles, M&M’s, Snickers), packaged food (Ben’s Original, Tasty Bite, MasterFoods), pet food, and more, boast six billionaire members who are together worth about $115 billion. Between 2020 and 2021, they added $21 billion to their fortunes.
“During the pandemic alone, billionaires involved in the food and agribusiness sectors — just those billionaires — increased their wealth by at least $400 billion,” said Nabil Ahmed, director of economic justice at Oxfam America. “We’ve seen 62 new food billionaires created during the pandemic.”
How food monopolies affect prices
Why are corporate profits so high at a time when regular people feel increasingly strapped? Because a small number of players have gobbled up most of the food chain. Cargill and just three other agribusiness companies control about 70 percent of the world’s agriculture market, according to Oxfam. Brands like PepsiCo, Nestle, Mondelez, and Conagra produce and market the vast majority of the offerings found in US grocery stores.
“We look at the supermarket shelf, and we might be buying tea, cereal, whatever it might be, and we think, ‘Oh, I’ve got a real offer of choice here on the product I want to buy,’” Ahmed, of Oxfam, told Vox. “Frankly, it’s an illusion of choice, because so many of those products are actually owned by the same company.”
Grocery retailers, too, have become increasingly consolidated. The ongoing Kroger-Albertsons merger, which could be blocked by the FTC, for example, has raised alarm bells from consumer advocates; if the merger goes through, Kroger-Albertsons and Walmart together would control 70 percent of their industry. In fiscal year 2022, Kroger’s operating profit was $4.1 billion — in 2021, it was $3.5 billion. Since the pandemic began, Kroger has paid billions in dividends to its shareholders.
Evan Wasner, a University of Massachusetts-Amherst economist who authored a recent paper on companies’ price-setting power with economist Isabella Weber, said that companies tend to raise prices when they think they won’t see a huge backlash — like when everyone else is hiking prices, too. “In a sense, economy-wide cost increases act as a kind of coordinating mechanism which allows firms competing with one another for market share to safely raise prices together,” said Wasner.
Companies are aware that shoppers are seemingly willing to accept the sticker shock at the grocery store — as long as there’s apparent justification for it. In February, General Mills’ CEO noted to analysts that consumers hadn’t pushed back against higher prices in the previous few quarters.
Market dominance makes the supply chain more brittle, too, because it means there are just a few vulnerable points for failure. Last year’s baby formula shortage is an example of how dangerous the results can be. Just two US companies control about 80 percent of the market, which meant that when one manufacturing plant shut down, the entire nation struggled to buy baby formula.
Becker blames the vulnerable state of supply chains in part on market deregulation over the last several decades, which has enabled companies to cut corners. In the 1980s, the growing popularity of “just-in-time” inventory systems, where companies order just the amount of inventory needed right now without a buffer, allowed companies to become more efficient. That has meant lower prices for consumers, usually, and higher profits for companies — until a crisis hits, and suddenly there are shortages and supply bottlenecks.
Food companies can raise prices. Consumers can’t do much about it.
The typical explanation of Covid-19-related inflation goes like this: The pandemic disrupted the flow of the global supply chain. How much it costs companies to make a good or provide a service went up. Other crises piled on; the Russia-Ukraine war, for example, drove up the price of key commodities like oil and wheat. In response to all of this, companies raised prices to offset their higher costs.
Economists agree that supply chain issues are a major driver of the price hikes we’ve been seeing. In the food industry especially, transportation disruptions due to the pandemic and higher grain prices have made a significant impact. But there’s disagreement on whether the higher costs that have resulted from those woes should be passed on to consumers — which is largely what has been happening, according to Becker.
Of course, corporations want to pass on their costs, and consumers would prefer prices didn’t rise. So who should pay? The problem is that there’s a yawning gap in power between these two opposed interests — and the imbalance can grow even wider during an economic shock, such as a pandemic.
This is a sellers’ inflation, explained Wasner. That means the pressure to increase prices comes from companies wanting to raise prices, not from consumers finding it difficult to buy what they want — it’s not inflation primarily caused by too much demand. During normal times, companies are hesitant to raise prices even if there’s higher demand, because if they’re the only one to hike prices, they could lose customers to competitors. During a crisis, it’s a different story, because there’s an implicit understanding that every company is going to raise prices. It’s a tacit agreement, a subtle wink and nod of understanding.
It can go beyond that, Wasner said. They can not only raise prices to offset costs but to gain profit margin. “If you’re purchasing meat at the grocery store, you don’t actually know how much the cost increase is for a slab of meat,” he said. “You just see your price go up and you say, ‘Okay, well, there are these things going on in the economy. I understand that’s just the way it is.’”
“Many food companies have basically taken advantage of the precarity of this moment,” said Ahmed, of Oxfam. “They’ve exploited but also exacerbated inflation.”
Transcripts of corporations’ recent earnings calls illuminate that they’re well aware of their power right now. Groundwork has been collecting highlights from corporate earnings calls on its website. “They’re saying a lot about cost increases and supply shocks, but they’re also saying it doesn’t matter,” said Becker. “We do have these higher costs that we’re paying, but we have so much pricing power, we’re so capable of passing all these prices on to consumers, that it doesn’t matter.”
In November 2021, Kroger’s chief financial officer said that the company was “very comfortable with our ability to pass on the increases that we’ve seen at this point. And we would expect that to continue to be the case.” Tyson Foods’ CEO said in August 2022 that sales had increased 16 percent year-to-date largely thanks to “higher average sales price in chicken and prepared foods.”
Ahmed points to what Jeffrey Meli, global head of research at Barclays bank, told Bloomberg early last year. “The longer inflation lasts and the more widespread it is, the more air cover it gives companies to raise prices,” Meli said.
The power of inflation narratives
This isn’t to say that companies aren’t sensitive to what consumers think about price hikes. In fact, they’re very sensitive and strategic, said Wasner.
But big corporations with brand recognition and customer loyalty can feel safer about charging more. (PepsiCo’s CEO noted recently, for example, that consumers were “willing to pay more for our brands.”) They believe customers will be more willing to pay higher prices if the hikes are seen as legitimate, according to Weber and Wasner’s paper. This legitimization can take place with the help of the media, and “a narrative of broken supply chains and exploding energy prices can develop understanding for rising prices on the part of customers, who would otherwise feel betrayed by the firms.”
That narrative has limits, of course, as my colleague Emily Stewart recently reported. But it has already worked to ease understanding and acceptance of incredible price hikes for essential goods and services. Once companies raise prices, they don’t tend to lower them even if input costs go down.
One way the media could refocus the inflation narrative is to look at the root causes of initial price increases, Wasner said, and “highlighting the profits that are reaped from these upstream industries” such as oil. Their price increases have rippled down all the way to the consumer; how do we prevent that initial price hike from happening in the first place? Waiting for inflation to subside isn’t really a solution. “In the meantime, prices have gone up and there’s essentially been a transfer of income from workers to firms,” said Wasner.
Becker echoed that the current economic orthodoxy on how to fix inflation — to rein in Americans’ ability to spend money by attempting to raise unemployment levels — should be questioned.
“I would say that we have this really toxic narrative out there that the only way we can get inflation under control is to throw a bunch of people out of work,” said Becker. “Larry Summers recently claimed that we would need 10 percent unemployment [for one year], which is about 11 million jobs lost, to get inflation under control.”
“We’re going to try to solve a cost-of-living crisis by making people poor or losing their jobs? I think that’s crazy,” he continued.
What will break the cycle of not just inflation, but of consumers having to pay ever-higher prices for essential goods while the world’s food producers become richer? Experts offered several potential solutions. One is stronger antitrust laws and improved enforcement of preventing and breaking up monopolies. Anti-price gouging laws are another tool in the arsenal. Oxfam, for one, has been a vocal advocate of a windfall profits tax on food corporations. “It’s a tax on those corporations which are raising prices substantially in excess of costs,” Ahmed explained. The fact that it would raise tax revenue is great. But “fundamentally, it reins in companies’ monopoly power and disincentives corporate greed.” Other countries already have similar measures in place. Spain expects to raise about $6.39 billion from its windfall tax on energy companies and banks.
“Corporations are really making profits on the backs of consumers and households,” said Becker. “Let’s tax those windfall profits — and let’s do something with that money.
“There’s nothing that really stops corporations right now from just doing whatever they want.” | Inflation |
- UBS confirmed to CNBC that it is offering Additional Tier 1 securities, but did not comment on the details of the contracts and said it will provide additional information when the offering is complete.
- The wipeout of $17 billion of Credit Suisse AT1 bonds, as part of the rescue deal brokered by Swiss authorities in March, caused an uproar among bondholders.
UBS on Wednesday began selling Additional Tier 1 (AT1) bonds — which were at the heart of controversy during its emergency rescue of Credit Suisse — for the first time since completing the takeover.
The Swiss banking giant is marketing two tranches of U.S. dollar AT1 bonds, a noncall five-year offering around a 10% yield and a noncall 10-year offering around 10.125%, according to LSEG news service IFR. Noncall bonds are bonds that only pay out at maturity.
UBS confirmed to CNBC that it is offering Additional Tier 1 securities, but did not comment on the details of the contracts and said it will provide additional information when the offering is complete.
The wipeout of $17 billion of Credit Suisse AT1 bonds, as part of the rescue deal brokered by Swiss authorities in March, caused uproar among bondholders and continues to saddle the Swiss government and regulator with legal challenges.
AT1 bonds are considered a relatively risky form of junior debt and are often owned by institutional investors. They were introduced in the aftermath of the 2008 financial crisis as regulators looked to divert risk away from taxpayers and boost the capital held by financial institutions to protect against future crises.
Fitch on Wednesday assigned the new AT1 notes a BBB rating, four notches below UBS Group's overall viability rating of A, with two notches for "loss severity given the notes' deep subordination" and two for "incremental non-performance risk."
"UBS's new AT1 notes will contain a permanent write-down mechanism at issue. However, subject to approval by UBS Group AG's 2024 AGM [annual general meeting], the permanent write-down mechanism will be replaced by an equity conversion mechanism from the date of the AGM, which will bring the terms in line with other European markets," the ratings agency said.
"The conversion feature would mean that, if approved by the AGM, the notes would be converted into a pre-defined volume of share capital of UBS Group AG if the latter's common equity Tier 1 (CET1) ratio falls below a 7% trigger, or if a viability event is declared by FINMA [Swiss Financial Market Supervisory Authority]." | Bonds Trading & Speculation |
The government has no room for unfunded pre-election tax cuts despite having pushed through a “colossal” £52bn a year stealth raid on household incomes on Rishi Sunak’s watch, the Institute for Fiscal Studies has warned.
Britain’s foremost economics thinktank said the dire state of the public finances meant that attention-grabbing tax cuts risked stoking inflation, leading to higher Bank of England interest rates and a lengthy recession.
On Sunak’s watch, tax revenues as a share of the British economy are on track to climb to the highest sustained levels since the second world war – in part driven by a six-year freeze on income tax thresholds, a policy first introduced during his time as Boris Johnson’s chancellor.
Known as “fiscal drag” and expanded by Jeremy Hunt last year, the IFS said the policy would raise a “colossal” £52bn a year for the exchequer by 2027-28. Suggesting the government may find its plans tough to maintain under heavy political fire, it said the freeze meant as many as 6.5 million more people would pay tax on their income compared with 2020, while 4.5 million more people would be dragged into higher income tax thresholds.
In its annual “green budget” health check before Hunt’s autumn statement next month, the IFS warned the UK remained stuck between weak economic growth on the one hand and the risk of persistently high inflation on the other.
A decision by the chancellor to relax the purse strings “might give a short-term economic sugar rush, but could prove unsustainable and ultimately mean a protracted recession as interest rates rise even further to bring inflation back under control”, it said.
Paul Johnson, the director of the IFS, said Britain was “in a horrible fiscal bind”, leaving Hunt or an incoming Labour government with little room to radically change tax and spending plans. “The price of our high levels of indebtedness, failure to stimulate growth and high borrowing costs is likely to be a protracted period of high taxes and tight spending.”
It comes as Hunt comes under growing pressure from within Conservative ranks to offer a round of pre-election tax cuts in a bid to reverse the Tories’ faltering performance in opinion polls, as Labour heads for a landslide victory comparable to Tony Blair’s 1997 triumph.
Sunak was last month reported to be considering an inheritance tax cut amid widening Tory divisions over tax, highlighted by Liz Truss demanding a sharp change in course from her successor at a packed-out conference fringe event in the party’s annual conference in Manchester earlier this month.
However, a year on from her disastrous mini-budget, Hunt is warning “difficult decisions” will be required at the autumn statement after a sharp worsening of the public finances over the past six months – wiping out what little room he had to cut taxes.
Despite overseeing the largest rise in tax revenues as a share of the economy on records dating back more than 70 years, the threats to the government from stubbornly high inflation, sluggish economic growth and a sharp rise in debt interest costs meant there was still “no room” for electioneering tax and spending promises, the IFS warned.
With the UK facing persistent inflationary risks and the sharpest rise in Bank of England interest rates in decades, the IFS said the government was on track to pay significantly more to service the national debt.
It warned debt interest spending was on track to settle at the highest sustained level since the mid-1980s – about £30bn a year higher than the level to which the UK has grown accustomed to over recent decades – limiting the chancellor’s options for tax and spending.
In forecasts made alongside Citi, the US investment bank, the IFS said it expected government borrowing this year would come in lower than predicted by the Office for Budget Responsibility. However, it said the Treasury’s tax and spending watchdog would probably pencil in much higher budget deficits over the next five years after taking into account the higher cost of government borrowing and weaker growth outlook for the economy.
A spokesperson for the Treasury said: “To secure our public finances we must stick to our plan which is on track to halve inflation, reduce public sector waste and get debt falling.” | United Kingdom Business & Economics |
Tens of millions of pounds belonging to about 80,000 young people without capacity to make financial decisions could be locked in trust funds, a report suggests.
Those families must go through court to access the savings when accounts mature - a process which can take months and cost hundreds of pounds.
Only 15 accounts were accessed this way in 2021. The government says it is unable to share more recent figures.
It says it is trying to speed up cases.
One mum told BBC News she wishes she had never gone through the "hugely stressful" process, and has advised others against it.
Michele Creed's dining room table is covered in documents, as she takes me through the year-long process of accessing her daughter Alana's savings account.
"I just can't believe I've had to do all this just to access the birthday money, Christmas money and other savings we've been putting away for her," she says.
Like the millions of others born between 2002 and 2011, Alana was given between £250 and £500 through the then-Labour government's Child Trust Fund scheme.
Families could then add their own contributions to help the savings pot grow.
Alana now has £7,500 in her account.
The 19-year-old has severe learning disabilities and lacks the capacity to make financial decisions. So, instead of being able to withdraw the money when she turned 18 like most of her peers, her family have had to spend nearly £750 going through the Court of Protection.
Michele says it was so complicated she had to go through the court process twice - costing £371 in fees each time - to make sure both she and her husband could access her daughter's savings. It took a year in total.
"It's so frustrating. Her older sister was just able to get her money without a problem, but with Alana, there was this huge block that we had to fight to get past," Michele says.
Michele is one of the few parents who has managed to withdraw her daughter's money through the Court of Protection. Ministry of Justice (MoJ) figures show only 15 accounts were accessed through the court process in 2021.
Michele wishes she "had never started" the "long, bureaucratic and expensive" process to get Alana her money, and advises other families who may be about to go to court to think twice.
"If you can leave the money where it is, and hopefully things will change one day, I would do that because it changes everything."
When a parent or carer is granted access to their child's savings, the Court of Protection makes them a deputy of the child's financial affairs.
This means Michele now has a lifelong legal duty to account for every penny she spends of her daughter's money.
She says the ongoing scrutiny feels like a "slur" on her character, pointing to her pile of receipts and spreadsheets, which are evidence of how she is spending Alana's benefits and savings.
"For many years I have been trusted to manage Alana's disability benefits as her appointee. But now, because I have had to become a deputy, I'm not trusted to manage her money," she says.
Alana loves going to Caffe Nero, so Michele sometimes spends £100 a month on going for coffees with her.
"It's her favourite thing to do, and now I feel like I've got to justify it."
A report by Renaissance Legal, a firm that supports families through the process, seen exclusively by BBC News, suggests there are more than 80,000 accounts that cannot be accessed without going through the Court of Protection.
By 2029, the year in which all of these accounts will have matured, there could be up to £210m locked away in Child Trust Funds that families have been unable to access.
'Fighting on all fronts'
Philip Warford, the firm's managing director, says in some cases young people have £75,000 worth of savings effectively locked away.
"Many of [these] families are fighting on all fronts, for the right education for their child, for the right amount in benefits, for better healthcare, and now they are fighting to get their own money back," he says.
"The financial risk posed by these families is zero - it's their money in the first place."
Laura Williams has been adding money to her 17-year-old son's account since he was born.
But she has decided not to apply to access Joel's savings of £6,000 because she doesn't want to face the "ordeal" of the court case and becoming a deputy.
Joel has Malan Syndrome, a rare chromosomal condition, and does not have capacity to make any decisions about his finances.
Laura transferred his Child Trust Fund into a Junior ISA several years ago, but the same rules around accessing the money apply.
"It's so unfair. Just because my child has a disability, he is going to be the one to suffer," she says.
Lord Blunkett told the BBC that "mistakes were made" by the Labour government that set up Child Trust Funds.
He says he and his colleagues did not foresee how the Mental Capacity Act would make it difficult for families to access the money.
"But now we need to get a bit of common sense into the issue," he adds.
"These families are trusted to handle their children's benefits - government money - by the Department of Work and Pensions. They can be trusted with their own savings."
The Ministry of Justice (MoJ) has previously considered proposals to change the process so families would not have to go to court.
But in February, after a year long consultation, it decided to keep the process as it is, in order to "protect against fraud and abuse".
The MoJ says it is simplifying the system to speed up the process. It added that most families who apply would get their fees waived but for some, if the account has more than £3,000, then it would be decided on a case-by-case basis.
When Michele went through the process last year, she was told she would have to pay the court fees.
Surrounded by her pile of receipts, she says becoming Alana's deputy has been hugely detrimental to their lives.
"Alana's savings were supposed to be something positive, but instead, what's come out of it is a life of feeling like we are being watched by Big Brother." | Personal Finance & Financial Education |
The work and pensions secretary has refused to commit to raising the state pension to match official overall earnings figures.
Under the government's triple lock pledge, next year's pensions are meant to rise by the highest of 2.5%, prices, or average wages.
Data released earlier suggested this was likely to be 8.5%, the average wage figure for the summer months.
But Mel Stride said he could not commit to using it for the calculation.
Speaking to BBC Radio 4's The World At One, he added the government remained "committed" to the triple lock promise.
But he said he was "not going to get into the mechanics" of the official process to work out the increase, which begins later this autumn.
The 8.5% earnings figure is likely to be the highest of the three benchmarks this year. It would make the new flat-rate state pension £221.20 a week, or £169.50 a week for the full, old basic state pension.
However, it is understood officials are looking at using a lower figure for earnings, by stripping out the effect of bonuses to public sector workers. The figure excluding bonuses is 7.8%.
Traditionally, the figure for May to July, including bonuses, is used for calculating pensions rises under the triple lock for the following April.
This year's average, however, has been boosted by one-off awards to settle public sector pay disputes.
In his Radio 4 interview, Mr Stride said there was "clearly is a difference" in the effect of bonuses on the figure - but the final decision would be made as part of the legal review this autumn.
He also admitted the triple lock, which has featured in both main parties' election manifestos, is unsustainable in the "very, very long term".
"But of course what I'm dealing with is now - and where we stand at the moment - is we remain committed to the triple lock," he added.
Manifesto questions
Earlier, Labour's deputy leader Angela Rayner refused to promise the triple lock would feature in her party's manifesto ahead of the next general election, expected next year.
She told BBC Breakfast: "We will have to see where we are when we get to a general election and we see the finances".
Prime Minister Rishi Sunak has also refused to say whether it will be in the next Conservative election manifesto. Mr Stride has previously said it "almost certainly" would be.
Both parties have committed to maintaining the triple lock at every election since the Conservative-Lib Dem coalition government first made the pledge in 2010.
Rising inflation over the past year has made the promise more expensive for the government to maintain, whilst the UK's ageing population has raised questions over its long-term viability.
The government's pointed refusal to commit to match the overall earnings figure and instead toy with a figure that discounts some one-off payments would save hundreds of millions of pounds.
But critics could accuse ministers of breaking the spirit of the triple lock.
'Runaway train'
In the near term, neither the Tories nor Labour are committing to maintaining the triple lock after the election. If the Conservatives keep it, it is expected Labour will do so; but if the Tories tweak it, Labour may follow suit.
The Institute for Fiscal Studies (IFS), a think tank, has estimated that maintaining the triple lock could cost an extra £5bn and £45bn per year, on top of inflation, by 2050.
Writing in the Times, former Tory leader William Hague urged the two main parties to give themselves the "space" to change stance on the triple lock, calling it "unsustainable" in the long term.
He said neither party could afford to "commit electoral suicide" by promising to scrap it alone, but "sometimes in politics, you have to help each other a bit".
"Everyone on a runaway train has a common interest in letting someone fix the brakes," he added. | Inflation |
The big Central Bank week is here: ECB, BoJ, Fed…wow!
Well…if you are an institutional investor who enjoys my macro analysis, I have great news for you!
I just launched a live Bloomberg chat service and institutional research service dedicated to you!
I'll cover macro, Central Bank and market events daily through an interactive BBG chat and deliver institutional-focused macro research pieces - ping me on Bloomberg (Alfonso Peccatiello) or email at [email protected] for a 2-weeks FREE trial!
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This is one of the most popular and yet misleading charts in macro.
People like simple narratives: the Fed is ''pumping money'' into the ''system'' and that's why equity markets go up.
That’s just NOT how it works - let’s explain why.
A good starting point is asking ourselves what’s ‘‘money’’ and what’s the ‘‘system’’.
Let’s start from money.
Central Banks' balance sheets expand mostly through monetary operations: the most known is QE, but there are also other tools like the recently created Fed's BTFP.
In any case, when the CB expands its balance sheet by acquiring assets (QE) or providing financing in exchange of collateral (e.g. BTFP, TLTRO) it also expands the liability side - it prints ''money'', but to be more precise it prints bank reserves.
Bank reserves are bank-money, not real-economy money: only banks can transact in bank reserves with each others, and these reserves can never (I repeat, never) reach the private sector.
No: banks don't ''multiply'' reserves when they make loans.
As the Bank of England shows, banks create new money when extending credit to the private sector and they do not ‘‘transform’’ existing reserves.
But most importantly, no: banks don't buy stocks (!) with newly printed bank reserves!
The idea behind this chart is just wrong: as the Fed creates new bank reserves (''liquidity'') there would be a mechanism for which banks deploy these reserves in financial assets hence pushing equity markets up.
But banks don't do that.
What are reserves used for?
Mostly to settle transactions against other banks.
They also account as a High Quality Liquid Asset (HQLA) together with government bonds and certain corporate and mortgage-backed securities: banks can use them to pay other banks if they buy HQLA assets from those, passing over bank reserves in a closed system like a hot potato.
But they won't use reserves to buy stocks - they are effectively not eligible as a HQLA asset or only under extremely strict conditions.
Equity ownership as a % of HQLA buffers from big European and US banks is negligible - conditions are so strict you could say it’s almost 0%.
I know what you are thinking now: the portfolio rebalancing effect.
If banks are bidding corporate bonds away from each other's HQLA buffers, spreads will tighten and this should invite a more aggressive stance from equity investors too.
That's partially true, but it's a potential second-order effect which also requires fundamentals (!) to back the thesis: banks aren't gonna blindly over-allocate to corporate bonds because they have more reserves if they smell the risk of rising defaults.
See what happened in 2008: the Fed ‘‘printed’’ almost $1 trillion (orange) very rapidly and yet corporate credit spreads (blue) kept widening as default risks were increasing due to the Great Financial Crisis.
Economic conditions matter after all.
Which brings me to the main point why the original chart in this piece is misleading.
These two series trended up over the last 15 years for different reasons: Central Banks kept accommodating through QE & Co to bring inflation back to target and most importantly...
...the Nasdaq went consistently up also because earnings grew by roughly 10% on average per year (!!!).
Don’t believe me yet?
Let’s do some basic math together.
Is it really true that ‘’liquidity’’ is so tightly correlated to stock market returns?
We ran a simple linear regression analysis between the change in ‘’liquidity’’ (US bank reserves) and the S&P500 returns in the last 15 years – we played around with time lags, outliers, return windows...everything.
Bank reserves and stock markets both tend to go up over time and hence they look ‘’correlated’’, but analysing the rate of change of liquidity and S&P 500 returns helps with smoothing this problem away.
The result was consistently clear.
A simple linear regression exercise tells us ‘’liquidity’’ is pretty bad at predicting stock market returns: as shown by the R2 data, in the last 15 years US liquidity only explained 3-4% (!) of the variation of SPX returns.
So, yes: both series trended up over time and plotting them on a dual-axis chart looks great but stocks go up over time because earnings grow and not because Central Banks pump ''money'' in the ''system''.
Money in this case means bank reserves, and banks can’t and won’t use reserves to buy stocks - the direct relationship and simple narrative suggested by mainstream macro commentators…
…simply doesn’t exist.
The big Central Bank week is here: ECB, BoJ, Fed…wow!
Well…if you are an institutional investor who enjoys my macro analysis, I have great news for you!
I just launched a live Bloomberg chat service and institutional research service dedicated to you!
I'll cover macro, Central Bank and market events daily through an interactive BBG chat and deliver institutional-focused macro research pieces - ping me on Bloomberg (Alfonso Peccatiello) or email at [email protected] for a 2-weeks FREE trial!
Yes: it costs you nothing to try! | Interest Rates |
Sir Keir Starmer is the “best of two bad candidates” to be Prime Minister, entrepreneur and former Dragons’ Den investor Duncan Bannatyne has said.
The health club tycoon said he was leaning towards supporting the Labour leader after Rishi Sunak’s “terrible” handling of the economy.
Mr Bannatyne said he didn’t think the “Conservative Party could run a Government” and warned that the country would soon “have to declare bankruptcy”.
His comments echo criticism made by lifelong Tory peer and Carpetright founder Lord Harris of Peckham earlier this week, who said the Tories did not “deserve” to win the next election.
A staunch supporter of Brexit, Mr Bannatyne said he had “no idea” who to vote for in the upcoming election but criticised the Prime Minister for forcing such high taxes on business.
In the past, he has backed both Labour and the Conservatives, supporting both Margaret Thatcher and Tony Blair.
He said: “I’m what you might call a sort of crossbencher. I support the party at the time that I think has got the right policies.”
One of the biggest issues still facing Britain is the lack of unity, which he does not think any of the current political leaders will be able to solve.
He said: “The trouble is the country’s torn in half. Half the people will vote for [one] party because they’re Brexiteers and one-half won’t because they’re ‘Remoaners’.
“How do you get the country collectively together? That’s a very difficult task. And none of the candidates for Prime Minister are able to do that.”
Mr Bannatyne, whose company Bannatyne Group operates 69 gyms, 46 spas and 3 hotels across the country, criticised the Government’s decision to hike corporation tax rates from 19pc to 25pc.
He said: “Birmingham council has just declared bankruptcy, I think the country will have to declare bankruptcy soon.
“Twenty-five per cent is a lot of tax on a company and some companies can’t afford that. There are companies that have closed down, I’ve closed five gyms since the pandemic started. I just don’t think enough has been done for businesses and to bring taxes down.”
The 74-year-old also criticised the Government’s handling of the small boats crisis.
He said: “ I think Rishi’s done a terrible job. He’s not doing anything to stop the boats and it’s getting absolutely ridiculous.
“We can’t afford them. You can’t you can’t get enough tax from people to pay for all these people coming here, living in hotels, it’s just impossible.
“The country is going to be in big trouble again one day.”
Mr Bannatyne has demonstrated his political changeability in the past. In 2015, he initially backed David Cameron for Prime Minister before backtracking to support then-Labour leader Ed Miliband.
Mr Bannatyne said: “Rishi was Chancellor when he brought in the furlough scheme and furlough got out of hand.
“He’s responsible for a lot of the debt of the country just as when he was chancellor, and now he’s prime minister and he’s trying to reduce that debt by taxing corporations... and encouraging the bank to increase interest rates at a phenomenal rate.”
His comments will pile further pressure on Mr Sunak as the Conservatives are still behind Labour in the polls and battling to boost the economy.
Lord Harris, a former close ally of Margaret Thatcher, told The Telegraph on Monday: “You can’t think of many good things that the Conservatives have done and stuck to.
“At the last election, they said they were going to open 40 new hospitals in the next five years. Where are they?”
Labour has made a conscious effort to win over business chiefs over the past year, similar to that of Gordon Brown and Tony Blair before their landslide victory in the 1997 election. It has been dubbed the “Prawn Cocktail Offensive 2.0” in reference to the former Prime Minister’s charm offensive.
The Opposition raised a record £6.4m in private donations between April and June this year, more than it secured in the whole of 2022.
Mr Bannatyne was speaking as he announced that his health clubs returned to profit last year after grappling with surging costs and the aftermath of the pandemic.
Sales at Bannatyne Group rose by £51m to £127m in 2022, while pre-tax profits rose to £1m from a loss of £12.9m the prior year. The chain now has around 210,000 members across the UK.
Improved finances have allowed the Bannatyne Group to raise the temperature of swimming pools in some of his gyms by around 1 degree, he said, after they were lowered last year to save on energy bills.
Despite easing energy costs, Mr Bannatyne said there was still pressure to raise prices because of inflation.
He said: “To get an equal balance, we should be raising them by 10pc. But we just cannot do that. We’re increasing by about three or four percent at the moment.”
“The biggest cost is wages and that’s not going to go down. And interest rates don’t look as if they’re going to go down. So all the costs we’ve got that increase, do not look as if they’re going to go down.” | United Kingdom Business & Economics |
The Liberal Democrats want to rejoin the European Union, their foreign affairs spokesman has said – despite Sir Ed Davey insisting it was “off the table” for the time being.
Sir Ed, who leads Britain’s fourth-largest party, said this week that voters are not talking about Brexit and that he has focused his party on other issues, including healthcare and sewage.
He has also refused to commit to rejoining the bloc, saying the Liberal Democrats’ focus is on revising existing Brexit arrangements.
But speaking on the first day of the party’s annual conference in Bournemouth, Layla Moran told a fringe event: “We want to rejoin. We want, as part of it, to get back into the Single Market.
“We recognise that, in order to do that, we have to do stuff before, to get to that relationship. How do we talk about it in a way that doesn’t push people away, so where is that sweet spot?”
Lord Newby, leader of the Liberal Democrats in the House of Lords, told the same discussion: “If we put Europe first and foremost, people will think we are mad.”
A Liberal Democrat spokesman said the party wanted to be “at the heart of Europe”, but added: “Right now, the priority is to fix the broken relationship with our closest trading partners and get a better deal for our farmers, fishermen and small businesses.”
It came as Guy Verhofstadt, who was the European Parliament’s Brexit coordinator and has long opposed British sovereignty, led a protest march in London on Saturday that organisers estimated attracted 3,000 people.
Mr Verhofstadt tweeted:
He was joined by Gina Miller, the high-profile campaigner who masterminded an anti-Brexit legal challenge.
On Saturday morning, Liberal Democrat activists backed a review of military recruitment to ensure “all possible steps” are taken to improve ethnic diversity.
Richard Foord, the party’s defence spokesman, said: “The Army is not even close to being reflective of the society that it exists to defend.
“Last year, just 3 per cent of the officers in the officer corps were accorded as being of ethnic minority background.”
Meanwhile, Tim Farron, the party’s environment spokesman, labelled the free market “our enemy when it comes to solving the housing crisis”.
Urging ministers to pursue “interventionist politics”, he added: “Perversely, the more restrictions and the more parity and the more power planning authorities have, the more likely we are to get housing built.”
On Sunday, activists will vote on a motion calling for a 1p tax on the sale of all new clothes, arguing it would reduce emissions and curb the “fast fashion” industry.
Wendy Chamberlain, the Liberal Democrat chief whip, defended the planned levy, insisting it was a “small price to pay” that would “reduce our emissions and … improve our recycling”.
On Saturday night, Carol Vorderman, the former Countdown presenter, and comedian Steve Coogan addressed the opening conference rally via videolink to support Liberal Democrat calls for electoral reform. | United Kingdom Business & Economics |
Donald Trump Jr asked a courtroom sketch artist to "make me look sexy" after giving testimony during a $250m fraud trial.
The former US President's eldest son made the request after spending several hours on the witness stand during a second day of giving evidence at the civil hearing on Thursday.
Mr Trump Jr, 45, insisted he was never involved or aware of financial statements that New York state lawyers say fraudulently inflated his father's wealth and the value of the family business.
The statements were given to banks, insurers and other organisations to secure loans and broker deals.
Donald Trump, his company and senior executives - including Trump Jr and his brother, Eric, 39, who are both Trump Organization executive vice presidents and entrusted to run their father's empire - have all denied wrongdoing.
But the presiding judge, Arthur Engoron, has already decided in favour of the prosecution - with the hearing taking place to determine the punishment.
New York's attorney-general Letitia James is seeking a penalty of at least $250m (£205m) and a ban on Trump and his sons from running a business in New York.
When Trump Jr finished giving evidence, court sketch artist Jane Rosenberg revealed he asked her to produce a flattering portrait, telling her "make me look sexy".
He referred to an image she created of former cryptocurrency tycoon, Sam Bankman-Fried, who is a defendant in a criminal fraud trial.
Bankman-Fried was depicted with a chiselled jaw and spiky hair - which Trump Jr said made him look like a "superstar", Rosenberg told Reuters news agency.
During his testimony, Trump Jr said he believed his father's statements were "materially accurate".
He told the court the former president maintained the documents had "lowballed" his wealth and the value of assets, including skyscrapers, golf courses and properties.
He insisted he only dealt with financial statements in passing, signing them off as a trustee and giving them to lenders to comply with loan requirements.
And he reiterated that he relied on assurances from company finance executives before "signing off accordingly".
Speaking outside court, Mr Trump Jr said he believed his testimony "went really well, if we were actually dealing with logic and reason, the way business is conducted."
The case was "purely a political persecution", he told reporters.
"I think it's a truly scary precedent for New York for me, for example, before even having a day in court, I'm apparently guilty of fraud for relying on my accountants to do, wait for it...accounting."
Eric Trump also testified on Thursday, insisting he had "no involvement and never worked on my father's statement of financial condition", adding that he "didn't know anything about it, really, until this case came into fruition".
"That's not what I did for the company", he maintained - telling the court his role was focused on "pouring concrete" - constructing and operating properties.
Read more:
Donald Trump compares himself to Nelson Mandela over criminal charges
The legal labyrinth facing the former US president
On Thursday, Mr Trump - the front-runner for the 2024 Republican nomination - said on his Truth Social platform that the trial was "RIGGED" and branded it a "Miscarriage of Justice" and "Election Interference".
Ms James and the judge are both Democrats.
Click to subscribe to the Sky News Daily wherever you get your podcasts
Mr Trump posted: "The Trump Organization is Financially Strong, Powerful, Very Liquid AND HAS DONE NOTHING WRONG."
The 45th US president - the only one to be impeached twice - faces legal cases in five different states across the country, with two separate actions in New York. | Banking & Finance |
Food shortages could become more common if the government does not secure domestic supplies, the National Farmers' Union (NFU) has warned, while adding the UK will always be reliant on some food imports.
Environment Secretary Thérèse Coffey said on Thursday shortages of some fruit and vegetables in UK supermarkets could last for a month, while insisting the country's food supplies were secure.
But the NFU has called on the government to ensure more food is grown here, while also strengthening supply chains and encouraging seasonal eating.
Ms Coffey came under fire for talking about seasonal British foods as a potential alternative to items running low in the shops because bad weather abroad had disrupted imports.
In the Commons yesterday she was asked if eating more seasonally and locally would help avoid food shortages, which have prompted purchase limits in some supermarkets.
Ms Coffey responded: "A lot of people would be eating turnips right now rather than thinking necessarily about aspects of lettuce, and tomatoes and similar."
But she added she was "conscious that consumers want a year-round choice and that is what our supermarkets, food producers and growers around the world try to satisfy".
Critics leapt on her ambiguous comments, interpreting them as a call to "eat turnips not tomatoes", when she seemed to be making a point about eating seasonally.
"Let them eat turnips," read the headline on the front page of today's Daily Mirror.
Need for 'focus' on domestic food supply
Today the largest farmers' organisation in England and Wales told Sky News Britain can't live without some food from abroad.
"We will always rely on imports to some degree for produce we can't grow here, or to ensure diversity of supply," NFU deputy president Tom Bradshaw said.
But "as global volatility increases, it's imperative the government focuses on building resilient domestic food supply chains," he added.
Ms Coffey had blamed the shortages on "very unusual weather" in places like Morocco and Spain, which supply much of Britain's fresh produce during dark winter months.
But the reduced imports compounded an existing shortage of vegetables like tomatoes and cucumbers.
These items are usually grown in heated, lit glasshouses during winter in the UK, but were planted later this year as farmers struggled to meet energy costs.
Risk of shortages happening more often
Today growers also warned stocks of British leeks would run out in April after crops suffered from a climate change-fuelled drought and record heat.
The NFU has urged the government to extend a support package for energy costs to horticulture and poultry, two energy-intensive industries that were left out of the financial scheme.
Failure to strengthen food supply chains will lead to "more instances like we have now where there's less availability of home-grown produce and at times when imports are disrupted," Mr Bradshaw told Sky News.
He also stressed the importance of "eating seasonally".
He added: "It's when British produce is at its best and often most affordable, and it's a great way to support local farm businesses and sustainable diets."
Watch the Daily Climate Show at 3.30pm Monday to Friday, and The Climate Show with Tom Heap on Saturday and Sunday at 3.30pm and 7.30pm.
All on Sky News, on the Sky News website and app, on YouTube and Twitter.
The show investigates how global warming is changing our landscape and highlights solutions to the crisis. | United Kingdom Business & Economics |
Transgender designer Erik Carnell has seen a surge in demand for his pins, prints, stickers and T-shirts after retailer Target pulled his products amid a backlash by some customers to its Pride collection, he said on Thursday.
Target’s Pride collection included more than 2,000 products from clothes and music to home furnishings, and while several are under review the only ones removed so far from its website and stores are from Carnell’s brand Abprallen.
Target said this year’s Pride collection led to an increase in confrontations between customers and employees and incidents of Pride merchandise being thrown on the floor.
In messages on the website and Etsy store for Abprallen, Carnell said the volume of orders was such that he had to temporarily stop taking new orders.
“Your support during this extremely difficult time means more than I can express,” Carnell wrote on the brand’s Etsy page, which advertises “Accessories for the loud, proud, and colorful.”
Abprallen, which means “ricochet” in German, is Carnell’s favorite word.
Screenshots and posts on social media show that Target previously sold three Abprallen items: a $25 slogan sweater with the words “cure transphobia not trans people,” an $18 “too queer for here” tote bag, and a “we belong everywhere” fanny pack.
London-based Carnell, a gay trans man, said on Instagram that he did not know if Target would begin selling the items again and that he would know more over the coming days.
“I hope that none of Target’s retail employees are the victims of further threats and that none of them come to any harm,” he wrote.
Backlash on social media was mainly targeted at Abprallen products that were not sold at Target, some of which contain images of pentagrams and horned ram skulls that some people associate with Satan worship.
Products sold on Abprallen’s Etsy shop included a pin featuring the slogan “Satan Respects Pronouns” for 5.20 pounds ($6.56), and an 8 pound ($10.10) enamel pin with the slogan “Trans Healthcare Now.”
“I am, believe it or not, not a Satanist,” Carnell said on Instagram, responding to reports and social media posts that labeled him as “Satan-loving.”
Etsy, an online marketplace where people sell home-made products, did not reply to requests for comment. | Consumer & Retail |
Prime Minister Rishi Sunak set out his five priorities for 2023 in a speech on 4 January.
"I fully expect you to hold my government and I to account on delivering those goals," he said.
Since then, he and members of his government have repeated them at every opportunity.
So, how is it going after six months?
Halving inflation
The government's top priority is halving inflation this year.
The measure the government is using is called the Consumer Prices Index (CPI), which tracks changes in the price of a typical basket of goods.
It is aiming to halve inflation of 10.7% - which was the figure for the fourth quarter of 2022 (October to December).
When the pledge was first made, many people expected this to happen anyway.
However, inflation has stayed stubbornly high and was unchanged - at a rate of 8.7% - from April to May. It has not fallen back in recent months in the way that it has in some other big economies.
So, there is still a long way to go to reach the target of 5.3%, and analysts are saying it could go either way.
A big problem for the government is that it mainly relies on the independent Bank of England - over which it has no control - to manage inflation by adjusting interest rates.
When will we know? Inflation figures for the fourth quarter of 2023 will be published on 17 January 2024.
Growing the economy
Downing Street said Mr Sunak's pledge to "grow the economy" will be met if the economy is bigger in the fourth quarter of 2023 than in the previous three months.
It is using GDP (or Gross Domestic Product), a measure of all the activity of companies, governments and individuals.
This would not normally be seen as a difficult pledge, because the UK's economy is usually growing. The economy has got smaller in only four quarters in the past 10 years.
But there has not been a lot of growth recently. In the last four quarters, GDP grew only 0.1% three times and shrunk 0.1% in the other quarter. The UK economy is still smaller than it was before the pandemic.
Another problem for the government is that the pledge to grow the economy is made more difficult by its promise to halve inflation.
The Bank of England has been putting up interest rates in an attempt to stop prices rising so quickly.
The reason behind this is that higher interest rates can reduce the demand for things. However, this slows economic growth.
When will we know? GDP for the fourth quarter of 2023 will be published on 13 February 2024.
Debt falling
When governments talk about debt falling, they almost always mean as a proportion of GDP.
The idea is that debt is falling if it is growing more slowly than the economy.
But that has not been happening recently.
The latest figures show that debt is above 100% of GDP for the first time since 1961.
And if Mr Sunak does not manage to achieve his second priority of growing the economy, then getting debt to fall as a proportion of GDP becomes harder.
It is not clear when Mr Sunak is aiming to have debt falling.
That is in line with the government's rule that it should be on course for that to happen in five years' time.
When will we know? The next update on forecasts for debt will accompany government plans for the economy, in its Autumn Statement later this year.
Waiting lists falling
Mr Sunak said: "NHS waiting lists will fall and people will get the care they need more quickly."
His pledge only refers to waiting lists in England, because Scotland, Wales and Northern Ireland manage their own health systems.
The overall number of patients waiting for treatment in England is still rising - from 7.33 million in March, to 7.42 million in April.
Mr Sunak has claimed that he is cutting waiting lists, but that is only true of certain lists.
The number of people waiting more than 18 months, for example, fell between February and March.
We asked Downing Street when the prime minister aims to have waiting lists falling. It pointed us towards the plan for tackling the backlog of elective care (care planned in advance), which said the overall waiting list was expected to be falling by about March 2024.
When will we know?: Waiting list figures are usually published on the second Thursday of each month.
Stopping small boats
The final priority was to set out a plan to stop the small boats, which are bringing people across the English Channel.
The prime minister proposed to do that by passing a new law. The government's Illegal Migration Bill has passed through the House of Commons and is now in the House of Lords.
Because the government has a big majority in the House of Commons, the bill is likely to be passed eventually.
Mr Sunak has said that his plan to tackle small boat crossings is "starting to work".
However, the bulk of arrivals usually turn up in the summer months so we will not know until later in the year whether or not his plan is working.
When will we know? Figures on arrivals in small boats are collected daily. | Inflation |
Kirloskar Group's NBFC Aims To Add Rs 800 Crore To AUM By March
Arka Fincap said it is aiming to add another Rs 800 crore to its Assets Under Management by March 2024.
Arka Fincap, a non-bank lender promoted by the Kirloskar Group, on Tuesday said it is aiming to add another Rs 800 crore to its Assets Under Management by March 2024.
The shadow bank, which announced its plans to raise up to Rs 300 crore from a non-convertible debentures issue, will be focusing on lending to small businesses going forward, according to a statement.
Its AUM currently stands at Rs 4,200 crore and the NBFC is aiming to close FY24 with an AUM of Rs 5,000 crore, the statement said.
Further, it said the company plans to open 10 more branches by March to take its overall network to 40 branches, and will be adding about 175 employees to take its overall staff size to 500 by March 2024.
Kirloskar group had infused Rs 1,000 crore into the NBFC commenced operations in 2019.
It is offering coupons of up to 10% on the NCDs, the statement said, adding that the NCDs come in three tenors of 24 months, 36 months and 60 months. | India Business & Economics |
- Bed Bath & Beyond, which filed for bankruptcy, is expected to soon close hundreds of stores.
- That is likely to result in a land grab by retailers and other companies that are looking to expand.
- It could be a particular good opportunity for low-price chains and dollar stores.
In strip malls across the country, Bed Bath & Beyond stores have "Closing Soon" signs.
For other retailers, those may as well be "For Rent" signs.
The home goods retailer, which filed for bankruptcy Sunday, won't only create opportunities for competitors to gain new customers and market share. Its shuttered stores will kick off a land grab for retailers hungry for additional space.
Bed Bath will join a list of other bankrupt companies, such as Kmart and Sears, that vacated spaces and made way for stores. Bed Bath has nearly 500 locations that could open up — between its 360 namesake stores and 120 Buy Buy Baby locations — for other companies to rent. It had already shuttered many spots, as it wound down 150 underperforming namesake stores and shut all 49 of its Harmon FaceValue beauty-chain locations.
The company's stores remain open and its website is still operating. Liquidation sales began this week.
Yet Bed Bath's coming closures are hitting at a good time, according to real estate firms and retail industry watchers. The retailer has locations in high-traffic suburban areas. Its stores are easily adaptable at their size — typically around 30,000 square feet, according to industry analysts. Off-mall shopping centers' vacancy rates are low and demand is high, especially as discounters grow and traditional mall players experiment with new concepts.
Former Bed Bath stores could turn into a variety of other retail spaces, said Deborah Weinswig, CEO of Coresight Research, a retail advisory group. They could become doctor offices for CVS or Walgreens, as the drugstore chains push into primary care, or turn into grocery locations for growing chains such as Aldi or Lidl, she said.
Some may be sliced into locations for multiple companies. Others may be backfilled by a single tenant.
Bed Bath's spaces are more move-in ready than Kmart and Sears locations because by and large they were better maintained, while the better-performing stores only "need a little light dusting," she said.
"In the past, I may have been a bit more concerned if we were to go through something like this, but I'm just not," Weinswig said. "I'm not worried at this point because of the fact you've had this tremendous change in terms of demand for physical spaces."
An appetite for space
Bed Bath & Beyond's stores will go on the market as the off-mall space is hot and shoppers are flocking back to stores.
Weaker retailers' locations thinned out during the fallout of the Great Recession and again during the Covid pandemic, said James Bohnaker, senior economist with Cushman & Wakefield. Now, a mix of stronger retailers are vying for space in similar strip centers, including dollar stores, off-price retailers, direct-to-consumer players like Warby Parker and Casper, and traditional mall retailers like Macy's.
Vacancy rates for shopping centers fell to 5.6% in the first quarter of this year, the lowest level since commercial real estate firm Cushman & Wakefield began tracking in 2007. Such locations, which often include a major grocer and businesses like gyms and restaurants, have gained popularity because of their convenience and proximity to growing communities, new subdivisions and wealthier shoppers.
Retail real estate had a banner year in 2022 in the U.S., as store openings outpaced closures for the first time since 2016, according to Coresight Research.
Major retailers opened roughly 2,500 net new stores in the U.S. in 2022, the firm found.
As of April, discounters are leading the way so far this year with announced store openings in the U.S.
Dollar General: 1,065 stores
Family Dollar (owned by Dollar Tree): 328 stores
Dollar Tree: 308 stores
Five Below: 199 stores
JD Sports: 134 stores
TJX Companies (includes T.J. Maxx, HomeGoods, Marshalls): 102 stores
Wawa: 100 stores
Burlington Stores: 96 stores
Ross Stores: 92 stores
Bath & Body Works: 92 stores
Tractor Supply: 70 stores
Source: Coresight Research data
Industry watchers expect retailers to expand at a similar pace this year, even as interest rates rise and the economy gets choppier.
There are several factors driving the demand for retail space, according to Coresight's Weinswig: Retailers have more money after shoppers' pandemic-fueled spending spree. Companies see brick-and-mortar stores as both billboards for their brands and fulfillment centers for their e-commerce orders. Retailers also are adding technology to better understand customer behavior, as Google and Apple's privacy changes make it harder to track them online. And hybrid work schedules mean shoppers visit stores throughout the day.
Discounters and off-price players, such as Dollar General, Dollar Tree and TJX Companies are leading the way with big plans for expansion, according to Coresight. They could become potential tenants, depending on how the former Bed Bath spaces are sliced and diced.
Bed Bath's vacated boxes could also be ideal spots for gym chains such as LA Fitness, Crunch and Planet Fitness, as well as off-price banners like TJX-owned HomeGoods and Marshalls, said Matthew Harding, CEO of Levin Management. The New Jersey-based firm is a landlord and property manager with more than 100 properties in five states and Washington, D.C. Its properties include some former and current Bed Bath locations.
Even mall players may take a look. Foot Locker, for instance, closed an estimated 187 stores in the U.S. in 2022, more than any other retailer, according to Coresight. The footwear company's CEO Mary Dillon, however, has spoken about plans to open new locations in strip centers. Macy's has also opened stores beyond malls.
Think of it as retail's circle of life.
Kimco Realty, a real estate investment trust with 27 Bed Bath stores in its portfolio, said it already has single tenants teed up to fill most of those locations. Through a spokesperson, the company said it can't yet disclose names, but they include a mix of off-price, full-price, entertainment, grocery, furniture, and automotive or appliance stores.
At a strip mall in the Phoenix area, one of Kimco's former Bed Bath & Beyond locations recently reopened as a Burlington store.
In one shopping center in Edgewater, New Jersey, a HomeGoods (owned by T.J. Maxx-owner TJX Companies) is moving into a former Bed Bath & Beyond, according to Levin Management.
In a Bergen County location in the state, negotiations are underway about turning a two-story Bed Bath & Beyond into multiple properties, according to Rick Latella, an executive managing director in the retail valuation practice of Cushman & Wakefield. | Real Estate & Housing |
The central banker for central banks wants govts to change their laws to give central banks legitimacy, authority & control over CBDCs: perspective
Bank for International Settlements general manager Agustin Carstens says, “People want their money to be digital and programmable,” during a speech on Central Bank Digital Currency (CBDC) legal challenges.
Speaking at the Bank for International Settlements (BIS) Innovation Hub-Financial Stability Institute conference on legal aspects of CBDCs in Basel, Switzerland on September 27, Carstens lamented the fact that “close to 80% of central banks are either not allowed to issue a digital currency under their existing laws, or the legal framework is unclear.”
Despite the legal challenges, the BIS chief said that people want to have a programmable CBDC, stating:
Carstens’ argument is predicated on his belief that “the current monetary system […] needs to evolve” because that’s what people want and that “advances in digital services are highlighting shortcomings in existing systems, while raising expectations about what money should do.”
However, Nigeria’s eNaira is one example of a CBDC experiment that directly contradicts Carstens’ statements.
Writing for the Mises Institute last month, Polish journalist Jan M. Fijor reported that 99.5 percent of Nigerians voted against the eNaira last October, but that the government pushed forward with it anyway while decreasing the availability of physical cash.
Even the International Monetary Fund (IMF) acknowledges that Nigeria’s CBDC adoption has been a disappointment.
According to the IMF report, “Nigeria’s eNaira, One Year After,” published in May 2023, “The public adoption of the eNaira thus far has been disappointingly low,” and that “despite the laudable undisrupted operation for the first full year, the CBDC project has not yet moved beyond the initial wave of limited adoption.”
What’s the IMF’s solution?
So, while Carstens at the BIS says that people are demanding a programmable CBDC, he completely ignores the situation in Nigeria, but that’s just one example.
He also ignores the concerns of citizens all over the globe that governments and corporations could be able to program CBDCs to restrict less desirable purchases, such as meat, ammunition, or gasoline, with the potential for even more serious abuses of power.
On the legal front, the BIS GM said that “Legal frameworks must also advance if we want CBDC to deliver on its potential” while acknowledging that “CBDCs raise new questions and will involve new use cases,” so “the legal framework must keep up.”
According to Carstens, “The legal framework is a key underpinning for the legitimacy of money, and the trust that people place in money. Without the law, money cannot function […] Most fundamentally, the legitimacy of a CBDC will be derived from the legal authority of the central bank to issue it. That authority needs to be firmly grounded in the law.”
Ultimately, the central banker for central banks wants governments all over the world to change their laws to give central banks the legitimacy, authority, and total control over issuing programmable CBDCs.
Image: Agustin Carstens, BIS YouTube | Banking & Finance |
As on most things, we’ve been here before.
Today’s “mortgage crisis” is in substance not unlike that of the late 1980s and early 1990s, when interest rates were raised sharply first to choke off an inflationary boom and then to protect Britain’s position within the European Exchange Rate Mechanism.
Only despite the frenzy of catastrophising we see in the media today, it’s not as bad this time around.
Doom-laden prediction and reflection has become very much part of our national psyche; the “mortgage timebomb” is only the latest outbreak of it. But are things quite as bad as portrayed?
There is no disputing the pain of the early 1990s – a severe recession, steeply rising unemployment, and a crash in nominal house prices, with many households left deep in negative equity.
People could genuinely not afford to pay their mortgages. Foreclosures, repossessions and forced selling became commonplace.
We don’t yet have that this time around. So far, there is no negative equity problem to speak of, foreclosures are rare, and house prices are barely lower than they were a year ago.
What’s more, both in nominal and real terms, Bank Rate is not nearly as high as back then, when it reached a peak of more than 14pc.
The operative words here are of course “yet” and “so far”. The media is full of catastrophising about what may be to come, much as it was last autumn over the separate “energy crisis”, when there were some particularly alarmist predictions about the sort of increase in bills likely to be faced by consumers.
In the event, prices had already peaked, and would soon be on a declining path.
I don’t want to belittle the nature of today’s mortgage rate crisis. Many households are looking at real hardship.
The Left-leaning Resolution Foundation think tank calculates that 800,000 households forced to remortgage next year face an average £2,900 per annum rise in their mortgage bills.
Others have pencilled in even larger estimates. And for many households, the mortgage crunch has already arrived.
According to the Bank of England, some 1.3 million households will reach the end of their fixed-rate term between the second quarter of 2023 and the end of the year.
Adding these two numbers together, you get to just over two million mortgages involving extra costs of around £6bn a year.
This is admittedly a big drain on people’s disposable income, but at little more than 0.2pc of GDP, it is not in itself enough to cause a serious recession.
The Resolution Foundation goes further and extrapolates that annual mortgage repayments are on track to be £15.8bn a year higher by 2026, which would represent a rather chunkier 0.6pc of GDP. But for that to happen, mortgage rates would need to remain elevated until then, which doesn’t seem likely.
Furthermore, this is not money that disappears into a blackhole. Higher lending rates involve a certain amount of redistribution away from household borrowers to net cash savers, the latter of which are still by far the larger group.
Most owner-occupiers already own their properties outright, so will be completely unaffected by changing interest rates.
The share of homeowners with a mortgage has fallen to just 30pc, against around 40pc in the early 1990s. The pain is therefore concentrated in a much smaller group of people proportionately.
New affordability rules introduced after the financial crisis, moreover, require lenders to ensure their mortgage borrowers are capable of weathering an increase in mortgage rates of at least 3 percentage points, which is roughly where we are as things stand, with the average five year fix having risen from 3.2pc a year ago to 5.2pc today, according to the Rightmove mortgage tracker index.
Many households face a challenging period of belt-tightening, in other words, but in terms of negative equity and repossessions, things do not so far look anywhere near as bleak as they did in the early 1990s.
Besides, banks and building societies are under intense political pressure to show forbearance, by allowing mortgages to be extended, arrears to accumulate and borrowers to swap onto interest-only deals.
Nor do banks want to see another explosion in bad debt experience after the near-death experience of the banking crisis 15 years ago. Kid gloves will therefore be widely applied to distressed borrowers.
Stress testing of the resilience of the banking system to economic shocks last year war gamed Bank Rate rising to around 6pc, which is at the high end of where markets now expect it to end up. So on interest rates at least, banks are already worrying close to the extreme scenario tested for.
Even so, there were lots of other gory elements to the stress test, including a deep domestic and global recession and a collapse in asset prices. Never say never, but we are for now quite a long way away from such an apocalyptic state of affairs.
I don’t particularly want to add to the frenzy of media criticism that currently surrounds the Bank of England and its counterparts in Europe and the United States.
To do so further increases the risks that the Bank of England will overreact and, in its determination to demonstrate that it is still on the case, end up over-tightening into an environment where inflation may soon be yesterday’s story.
As it happens, there is a reasonably good case for saying the tightening cycle has already gone far enough. This is because of the aforementioned mortgage rate “cliff edge”. Back in the early 1990s, the vast majority of households were on variable rate mortgages. Any increase in Bank Rate would therefore immediately feed through to demand via higher mortgage costs.
Since then, the mortgage market has changed markedly. The great bulk of mortgages are now two, three and five year fixed rate deals.
The upshot is that up until now households have been largely protected from the rising interest rates that began more than a year and a half ago.
Only now are the effects being felt as such deals expire and have to be refinanced at much higher rates.
In the past, the damage to disposable income from rising interest rates would be immediate, but this time around it has been on a long fuse. The Bank of England is therefore largely in the dark over what rate of interest is needed to bring inflation to heel. Has it already done enough? It’s hard to know.
As I say, I don’t particularly want to add to the orgy of Bank bashing; I’ve already done more than my fair share of it. But what is clear is that central banks are deeply complicit in promoting the idea that the ultra-low interest rates of recent years were permanent, and therefore that today’s bloated house prices were an affordable phenomenon.
“Forward guidance” to the effect that the central bank would keep interest rates low for an extended length of time became part of the lexicon of the Bank of England.
That the US Federal Reserve and the European Central Bank were even worse behaved in this regard does not excuse the Bank of England from this collective delusion.
Given what the Bank kept saying, it is not surprising that people assumed that mortgage rates would remain at 2pc forever, and acted on that assumption. Forward guidance has turned out to be a terrible mistake which has badly misled a whole generation of house buyers.
Nor can the Government escape blame, having actively encouraged essentially unaffordable house purchases with stamp duty holidays and help-to-buy.
Things have now changed, and today we have the opposite problem, a different sort of forward guidance where central banks say they will need to keep raising rates into the indefinite future to tame inflation.
This is beginning to look equally misjudged, causing interest rate expectations, and mortgage rates, to rocket. Our monetary gurus have created an awful mess, for which many households pay a punishing price.
That it is unlikely to be as bad as the early 1990s is little consolation to those at the sharp end of these policy misjudgments.
This article is an extract from The Telegraph’s Economic Intelligence newsletter. Sign up here to get exclusive insight from two of the UK’s leading economic commentators – Ambrose Evans-Pritchard and Jeremy Warner – delivered direct to your inbox every Tuesday. | Interest Rates |
Last year, just as farmer David Isermann was coming out of years of chaos created by the coronavirus pandemic, he was heading into the fields to plant his crops when the war in Ukraine started, throwing even more uncertainty into his annual farm management plan.
“It totally disrupted the whole system,” Isermann told VOA from his farm outside Streator, Illinois. “Prices went up in anticipation.”
The biggest price hikes were for a farmer’s “inputs” like fertilizer. “The problem is that Russia and their ally, Belarus, are major suppliers of the three things we use, nitrogen, phosphorus and potassium,” Isermann said. “So, that interrupted our supply line of that. When you take out two of the world’s major suppliers, it affects things.”
But as the war in Ukraine grinds on in its second year, Isermann is in the middle of a new growing season at a time when the impact on global supply chains have eased. “Things have kind of worked themselves out a little bit,” he said. “Prices are dropping. Grain prices are down, so people are not as aggressive on fertilizer purchases, so that kind of helps demand a little bit.”
Joe Camp with Comstock Investments, an agriculture risk management firm, said the overall price for grains, including corn and soybeans, and wheat in particular, stabilized after Russia and Ukraine agreed to the Black Sea Grain Initiative brokered by the United Nations and Turkey in 2022.
“Since then, we’ve not seen a material increase in demand, but we know that that can change going forward,” particularly if the grain deal, which was only recently extended by two months, falls apart as the war rages on. “It’s actually taken prices lower as we compete with cheap wheat, continue to do that, the same thing with corn,” Camp said. “It keeps prices generally lower than they otherwise would be if we had that demand flowing back from Russia and Ukraine.”
The U.S. Agriculture Department reports that millions of tons of grain travels through the Black Sea each year, making the region a major supplier of commodities globally, particularly to Africa. Any change in the ability to move those grains through the international waters of the Black Sea can impact the global price of commodities.
Camp said the Black Sea grain deal also affects a U.S. farmer’s input prices, despite international sanctions against Russia. “Even the grain export deal allows for Russia to keep sending out fertilizer, so relative to what we feared, we’re well stocked and benefiting from low prices heading into the new season,” he told VOA.
But while the prices for what Isermann needs to grow his crops are lower this year, the rising cost of everything else – including loans – because of soaring inflation is cutting into his profits. “It affects everyone we touch,” he said.
Low unemployment in the United States also affects Isermann, who admits it’s hard to find people to do some of the work he and his family must outsource on the farm. “You try to find somebody to haul grain for you. If you don’t have your own truck, it’s very difficult. That problem is there. We just don’t have the people to drive the trucks anymore.”
While Isermann is slowly incorporating automation into his farming equipment, the one thing he can depend on is the manpower to plant and harvest the crops he grows this year, because either he or a member of his own family is the one driving the tractors.
US Farmers Buffeted by War in Ukraine, High Interest Rates
update | Agriculture |
Five Key Charts To Watch In Global Commodity Markets This Week
In the spirit of July 4th celebrations, this week’s edition has a strong focus on the US consumer. While Americans will enjoy cheaper prices at the pump and other energy-related costs from a year ago, inflation pressures are still paramount when it comes to food. Here are five notable charts to consider in commodity markets.
(Bloomberg) -- In the spirit of July 4th celebrations, this week’s edition has a strong focus on the US consumer. While Americans will enjoy cheaper prices at the pump and other energy-related costs from a year ago, inflation pressures are still paramount when it comes to food. Here are five notable charts to consider in commodity markets.
Gasoline
Americans will be hitting the road in record numbers this year, with 43.2 million motorists expected to drive 50 miles or more from their homes over the five-day holiday period that culminates Tuesday, according to AAA. The good news: Average national gasoline prices are more than a dollar per gallon lower than at the same time a year ago amid weakness in oil prices, providing consumers with welcome savings as other inflation pressures linger. The bad news: At about $3.54 a gallon, that’s still above the five-year average. And given the increase in cars on the road, an extra fill-up may be needed from idling in traffic. Even so, Nymex gasoline futures — which tend to dictate retail prices — are well below the record set last summer, which should keep pump costs in check in the near term.
Meat
Backyard barbecues are a favorite for many Americans as they celebrate Independence Day, but consumers may want to limit their hamburger intake. Wholesale beef prices have jumped almost 25% from a year ago amid high feed costs and a cut in herd size due to ongoing drought in the Plains. For those seeking a bargain, chicken is the way to go. Wholesale boneless chicken breasts have plunged 60% over the same timeframe, while pork prices have dropped nearly 5%. Wholesale prices offer a leading indicator for what shoppers will eventually pay at the supermarket.
Propane
To cook that meat, you’ll need plenty of propane for your barbecue. And there’s more positive news on that front. Benchmark US propane spot prices — which eventually trickle down to costs at retail — have plunged more than 65% since hitting a multiyear high last year in the weeks following Russia’s invasion of Ukraine. Prices are likely to stay low with inventories at the highest ever on a seasonal basis in data back to 1994.
Power
Soaring heat across Texas, other parts of the central US and the West Coast is causing energy demand to spike with air conditioners running at full speed. But compared with last year, power prices are down across the board thanks to slumping costs of natural gas, which is the country’s top source for electricity generation. In Texas, where scorching temperatures are likely to extend beyond the Fourth of July celebrations and keep many indoors, power prices are 27% lower than a year ago. The picture is much brighter further east, where prices on the largest US electric grid — managed by PJM Interconnection LLC — are 70% below 2022 levels at almost $50 per megawatt hour. Natural gas has almost halved over the same period.
Dairy
Last but not least, let’s talk dessert. A holiday celebration isn’t complete without a sweet treat to complete the meal. But this year’s indulgence won’t be as kind on wallets if ice cream is on the menu. The cost of a half-gallon of ice cream is near the highest on record, according to the latest US government data, in large part due to rising input costs. Retail milk is above $4 a gallon, while prices for sugar are at a peak. The US was the largest ice-cream consumer in 2022, according to Euromonitor.
--With assistance from Millie Munshi, Naureen S. Malik and Mark Chediak.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P. | Inflation |
(Corrects to add dropped word 'the' in paragraph 1)
By Marc Jones
LONDON (Reuters) -A milestone move by the European Central Bank toward launching a digital euro within a few years means the time has come for the newest incarnation of money to prove its worth.
A few countries have introduced central bank digital currencies (CBDCs), China is trialling a prototype yuan with 200 million users, India is gearing up for a pilot and some 130 countries representing 98% of the global economy are exploring digital cash.
The ECB's move on Wednesday to establish a pilot that could lead to a digital currency for the 20 countries that use the common currency, making it the first heavyweight Western central bank to formally forge ahead, could become a global blueprint.
Supporters say CBDCs will modernise payments with new functionality and provide an alternative to physical cash, which seems in terminal decline.
But questions remain why CBDCs represent an advance, with uptake low in countries such as Nigeria that have adopted them, as well as protests against the ECB’s plans, showing public concern about snooping.
Commercial bankers fret about the costs and possible deposit bleeds as customers could move money into central bank accounts, while developing countries worry that an easily accessible digital dollar, euro or yuan could cause havoc in their systems.
'WHAT IS MONEY?'
The ECB's plan "is a very big deal, and a lot of the rest of the world is watching this closely", said Josh Lipsky, who runs a global CBDC tracker at the Atlantic Council.
"It is one of the biggest central banks, so if it comes up with answers to the privacy and cyber security issues and the ability to use it offline, it will be a very influential."
Central banks were spooked into action five years ago when Facebook floated plans for a breakaway currency. Now, though, policymakers have yet to fully persuade many why CBDCs are needed.
Fabio Panetta, the ECB Executive Board member overseeing the bank's digital euro work, said it would help "future-proof" the currency and reduce what he called an over-reliance on the payment systems of U.S.-based credit cards.
But experts are scratching their heads.
"It's not yet clear what the thing is that could be done with a retail CBDC that couldn't also be replicated with commercial bank money," said Barclays' managing director of advanced technologies, Lee Braine, who has been involved in some of the Bank of England's digital pound projects.
"You are potentially breaking some of the singleness of money" he said, flagging the risk of a two-tier system if CBDCs are allowed different functionality or data disclosure rules than bank accounts.
"This all comes down to, what is money?"
DEFINING A GLOBAL STANDARD
A key unknown is whether the U.S. Federal Reserve or Bank of Japan will launch retail CBDCs.
India could be a more effective test environment than China because, while each Asian giant has more than 1 billion people, India has a far more open economy.
In contrast, Canada and some others appear to be tapping the brakes, while most of those already using CBDCs are seeing very little interest.
Data this month from the Bahamas, which launched the world's first digital currency in 2020, showed personal transactions of its SandDollar were down 11% in the first seven months of the year while wallet top-ups had plunged four fold.
An International Monetary Fund (IMF) paper in May described public adoption of Nigeria's eNaira as "disappointingly low", with 98.5% of wallets never even used.
"The current adoption level of eNaira has been reflective of the early stage of CBDC awareness," the country's central bank said in a written response to questions, adding it had been "consistent" with expectations.
Bo Li, an IMF deputy managing director, said this month the multilateral lender was helping dozens of countries with CBDC plans and would soon publish a how-to guide. It is building what it calls its XC platform, meant to process or "settle" CBDCs transactions.
The Atlantic Council's Lipsky said this, along with the technology choices the ECB and India make, could start defining a worldwide standard, as VHS did early in videotape era.
"The overarching question" about developing CBDCs, Lipsky said, "is how does this improve the financial system? That it really what it's all about".
(Reporting by Marc Jones in London; Additional reporting by MacDonald Dzirutwe in Lagos; Editing by William Mallard) | Banking & Finance |
From across the globe, spanning a diverse range of applications in finance — these are the world's top 200 fintech companies.
Together, CNBC and independent market research firm Statista worked to compile a comprehensive list of companies building innovative, tech-enabled and finance-related products and services.
related investing news
The partnership set out to list the top fintech companies using a clearly defined methodology identifying how various different companies performed against a set of key performance indicators, including total number of users, volumes, and revenues.
The chosen companies have been divided up into nine categories: neobanking, digital payments, digital assets, digital financial planning, digital wealth management, alternate financing, alternate lending, digital banking solutions, and digital business solutions.
This was done to account for the fact that business performance of fintechs in different fields of finance can't be compared like-for-like.
The fintech space has gone through a tumultuous period. Companies have seen their valuations slashed, funding is scarce, and businesses are cutting back on staffing and other costs in a bid to keep investors happy.
At the same time, innovation is continuing to happen. Several firms are developing tools to help customers budget in more effective ways and predict what their future financial situation might look like.
In the digital assets space, meanwhile, there's been a greater focus on building technology to help improve some of the financial services industry's biggest challenges, from moving money across borders to real-time settlement.
CNBC has broken the list up category by category — from neobanking all the way down to digital business solutions.
Quicklinks:
- Neobanking
- Digital payments
- Digital assets
- Digital financial planning
- Digital wealth management
- Alternate financing
- Alternate lending
- Digital banking solutions
- Digital business solutions
For the full list and the methodology, click here.
Digital banks, or neobanks, are continuing to grow and develop new products. These are companies, typically with their own bank license, that have been set up with the aim of challenging large established lenders.
Neobanks have been among the hardest hit by a souring of investors on fintech, particularly as their business model — spending lots to attain large numbers of customers and make money on card payments — has come under scrutiny with consumer spending slowing.
Still, several neobanks have performed surprisingly well out of the rise in interest rates. Many have gotten into lending. In Europe, for example, Monzo recorded its first monthly profit after a jump in lending volume.
There are many expected names present in the neobanks category, including Revolut, Monzo, and Starling. However, there are also less established players represented from emerging markets, like Nigeria-based fintech Kuda and Indian foreign exchange startup Niyo.
The worldwide digital payments industry is currently estimated to be worth over $54 trillion, according to data from JPMorgan — and that's only set to grow as more of the world starts to see digital adoption.
It's a colossal market, with many different players fighting it out for their slice of the hyper-competitive pie. But that has meant there's been room for other industry players to innovate and compete with their own offerings as well.
Statista identified 40 firms as top digital payments companies. These include major players such as Chinese mobile wallet Alipay and tech giant Tencent, which operates the WeChat Pay payment services, and U.S. online payments powerhouse Stripe.
Klarna, Affirm, and Afterpay also feature. The buy now, pay later space has been under huge pressure amid fears of a drop in consumer spending — but it has equally become a lifeline for many as rising inflation forces people to search for flexible payment methods.
Lesser-known firms, including French telecoms firm Orange and payments compliance startup Signifyd, were also selected. Orange operates Orange Money, a mobile money service. It is highly popular in Africa and counts more than 80 million accounts worldwide.
Digital assets is a market that has faced huge pressure recently, not least because the regulatory environment for firms has become much tougher following major collapses of notable names such as FTX, Terra, and Celsius.
It's also incredibly sensitive to movements in prices of digital currencies, which have depreciated considerably since the peak of the most recent crypto rally in November 2021. Exchanges in particular saw their revenues dry up as trading volumes evaporated.
Valuations of companies in the digital assets space have taken major haircuts. And this pain has filtered through to the private markets, too.
Binance, which features as one of the top digital asset companies, is under heightened scrutiny from regulators around the world.
In the U.S., Binance is accused by the U.S. SEC of mishandling customer funds and knowingly offering investors unregistered securities while publicly saying that it doesn't operate there.
For its part, Binance denies the allegations.
It was important that the company be included, given it remains the largest crypto exchange around and is a prolific backer of ventures focusing on so-called Web3.
Efforts are underway globally to bring digital assets into the regulatory fold. In the U.K., the government has made a play to become a "crypto hub." And the European Union is making rapid strides with landmark .
Alongside crypto heavyweights Binance and Coinbase, Statista also identified Cayman Islands-based crypto exchange BitMart and nonfungible token marketplace OpenSea as top fintech companies operating in the digital assets category.
Financial planning is another big area of finance that's being reshaped by technology, as people have turned to online tools to manage their financial lives in favor of more cumbersome paper-based options.
There are now plenty of online platforms that enable users to get better visibility over their finances. Education has become a big focus for many players, too — particularly in light of the rising cost of living, which has put significant pressure on household budgets.
In this field, Statista identified 20 names that fit the bill as companies leading the pack globally when it comes to innovating in financial planning.
They range from those changing the way people select and educate themselves about financial products, like NerdWallet, to services seeking to help people build up their credit scores, like Credit Karma.
A plethora of tech startups have rocked the wealth management space over the past several years with lower fees, smoother onboarding, and more accessible asset picking and trading experiences.
The likes of Robinhood and eToro lowered the barrier to entry for people wanting to own stocks and other assets, build up their portfolios, and acquire the kind of knowledge about financial markets that has previously been the privilege of only a few wealthy pros.
In the Covid-19 era, people built up a glut of savings thanks to fiscal stimulus designed to stem the impacts of lockdowns on world economies. That was a boon to fintechs in the wealth management space, as consumers were more willing to part with their cash for riskier investments.
These companies have been under strain more recently, though. Interest from amateur traders has slipped from the heyday of the 2020 and 2021 retail investing boom. And, as with other areas of fintech, there's been a greater focus on profitability and building a sustainable business.
In response, platforms sought to prioritize product development and longer-term investing experiences to continue attracting customers. In the context of high interest rates, several companies launched the ability to invest in government bonds and other high-yield savings options.
In the wealth management category, Statista identified 20 names. They include Robinhood, eToro, and Wealthfront, among others.
Small and medium-sized businesses, which are often turned away by established banks, have increasingly turned to new forms of financing to get the necessary funds to grow their business, meet their overheads, and pay off outstanding debts.
Equity crowdfunding has given companies a chance to give early customers the ability to own part of the services they're using.
Meanwhile, revenue-based financing, or borrowing against a percentage of future ongoing revenues in exchange for money invested, became a more popular way for firms typically turned away by banks and venture capitalists alike to get access to funding.
Higher interest rates arguably make these forms of financing more attractive versus seeking loans, which are now far more costly — though it does pose challenges for these businesses, as their own ability to raise capital themselves becomes more difficult.
In the alternate financing category, 20 firms were awarded. They range from Patreon, the popular membership service for online content creators, to crowdfunding companies Kickstarter and Republic.
Non-bank lending has been a rising trend in the financial services industry over the last several years.
Tech startups looked to provide a better experience than banking incumbents, using cloud computing and artificial intelligence to improve service quality and ensure faster decisioning on loan applications.
The global digital lending platforms market is forecast to be worth $11.5 billion in 2023, according to GlobalData, and this is expected to grow to $46.5 billion by 2030.
Over the last year or so, a number of fintechs pivoted to lending as the primary driver of their business, looking to benefit from rising interest rates — the Federal Reserve, Bank of England and numerous other central banks have rapidly raised rates to combat inflation.
Lending also tends to be the more lucrative part of finance, more generally.
While digital payments is often the area that draws most investor buzz, lending generates more money in financial services. Payments, by contrast, is a notoriously low-margin business since companies tend to make money by taking a small cut of the value of each transaction.
Statista identified 25 fintech companies that fall into the category of top alternate lending firms.
They include American small business lending firm Biz2Credit, Irish e-commerce lending company Wayflyer, and Latvian loan refinancing startup Mintos.
An emerging category of fintech companies takes a different approach to disrupting financial incumbents — giving other companies the ability to offer their own digital banking offerings rather than being the face of those services themselves.
Banking-as-a-service has been a buzzword in fintech for some time now. It's not exactly a well-known term, but it refers to the ability for non-financial companies to provide their customers a range of financial products including checking accounts, cards, and loans.
Embedded finance, where third-party financial services like bank accounts, brokerage accounts and insurance policies are integrated into other businesses' platforms, has also gained traction.
Another theme that falls within this world is open banking, or the ability for non-bank firms to launch new financial services using customers' account data.
Digital banking solutions has become a more closely-watched aspect of fintech, as attention has turned away from consumer-oriented services to business-focused ones. However, it hasn't been without its own challenges.
Like other areas of fintech, the space has been vulnerable to a funding crunch as hawkish central bank actions have made capital more expensive. Railsr, formerly a U.K. fintech darling, entered liquidation in March after reports that it was struggling to find a buyer.
"Not all programs were created equal," Peter Hazlehurst, CEO of Synctera, one of the top 200 awardees, told CNBC. "As a result, a number of folks were unable to raise their next round or continue to grow or to continue to get customers."
In the digital banking solutions category, 15 firms were awarded, including Airwallex, ClearBank, and Solaris.
Digital business solutions might not be the most attractive part of fintech, but it's the one gaining much of the love from investors at the moment.
These are companies selling a range of financial solutions to businesses, ranging from accounting and finance, to human resources and anti-fraud solutions.
As the economic outlook has darkened for many businesses, the need for products that help firms deal with their own costs and operate in a compliant manner has become critical.
In the digital business solutions category, Statista identified 25 companies.
They include tax and accounting software firm Intuit, human resources platform Deel, and fraud prevention startup Seon. | Banking & Finance |
TL;DR: Through Sept. 24, get the aloSIM Mobile Data Traveler Lifetime eSim Plan for just $21.97.
Whether you’re flying home for the holidays or checking off a bucket list destination, planning an international getaway is extremely exciting. And, well, stressful. And expensive. Especially when it comes to getting a SIM card and mobile data.
Instead of the hassle of getting a traditional SIM card and succumbing to international data costs, you could try aloSIM. This digital SIM comes with $50 to spend on mobile data and through September 24, it’s only $21.97 (reg. $50).
Travel hassle-free and affordably
A digital SIM card is essentially mobile data, so you don’t have to worry about getting a physical SIM card through your mobile carrier or paying their high data costs. This is how simple it is to use aloSIM:
Download aloSIM to your phone, tablet, or computer.
Select a data package for the location and duration of your trip. aloSIM works in over 170 countries and has plans as short as a week or as long as a month.
Activate the data package when you arrive at your destination.
One important thing to keep in mind is that data packages expire at the length of time stated at redemption, even if you have remaining data. This means leftover data will not carry over for future use.
Your digital SIM is for life
This purchase gets you lifetime access to the digital SIM card, but you’ll need to load prepaid data packages onto it for each trip. You also get $50 in credit to spend on data. Even after you use the credits up, you’ll have access to aloSIM’s affordable data plans for life.
Take away some of the stress and expense of international travel with aloSIM. Get your digital SIM for life and $50 of credit to spend on data for just $21.97 (reg. $50) until September 24 at 11:59 p.m. PT, no coupon needed.
Prices subject to change. | Consumer & Retail |
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President Joe Biden will announce new proposed measures on Tuesday aimed at protecting Americans’ retirement savings from junk fees collected by financial advisers.
The president is expected to speak at 3:30 p.m. ET. Watch live in the player above.
“America’s families spend a lifetime saving so they can retire with dignity. But junk fees are chipping away at their savings, going to financial advisers with conflicts of interests instead of to American families, and making retirements less secure,” the White House said in a statement.
With current rules differing from state to state, the Department of Labor plan would attempt to close loopholes and guarantee that advisers must act with their clients’ best interest in mind.
This move is the latest of Biden’s efforts to help U.S. consumers by taking action against insidious fees that are often hidden by deceptively low prices. His administration has shed light on several industries that use these fees, which drive up the cost of everything from concert tickets to airline seats to your cable bill.
This is a developing story and will be updated.
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Oct 30 | Personal Finance & Financial Education |
Nearly 90% of people on income support payments say the inability to cool their homes in hot weather is making them sick, and even those who have air conditioning avoid using it because it is too expensive, a survey by Australian Council of Social Service has found.
Acoss polled 208 recipients of Centrelink payments in January about their experience of high heat at home, their ability to cool their homes, how the heat affected their physical and mental health, and the costs of their energy bills.
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Nearly two thirds of those surveyed – 72.1% of whom were renting privately or in social housing – said they were unable to cool their homes down in periods of hot weather.
Some 89.4% said they sometimes or always felt unwell in the high heat, while 29.8% said they had needed to seek medical care for heat stress, with elderly people or those living with disability worst affected.
Nearly 70% of people surveyed had air conditioning of some form in their home, though many reported it did not function well or only lowered the temperature in one part of the house. Some 94.5% of people with air conditioning said they avoided using it because it cost too much.
“This is an untenable situation,” the report’s authors wrote, noting that many survey participants called on governments to do more to help them.
Wagga Wagga residents Liz, 52, and Mike, 62, live with their two children and both receive Austudy while they retrain to help fill the teacher shortage. They told Guardian Australia they have tried all kinds of things to help keep their rental home cool, including blacking out the windows with cardboard and placing fans throughout, with limited success.
“There’s bugger all insulation in the roof, and once it gets a bit over 30 degrees it’s just really hot and there’s nothing you can do about it,” said Liz, who asked that the family’s surname not be used.
Mike, who manages numerous chronic health conditions including diabetes, atrial fibrillation and obstructive sleep apnea, has found his health significantly affected by the heat, but there is little he can do other than stay hydrated and sit in front of the evaporative cooler.
The family said 90% of their electricity bill was running the cooling system, as their cooking and hot water is still on gas. The last electricity bill they received was about $700 for the quarter. The maximum Austudy payment for a couple with children is $306.30 per week.
Liz said the government ought to put a cap on how much energy companies can charge, and help people in rental properties insulate their houses to a basic standard.
She also called for an increase in income support payments. “We’re basically living in poverty until we get our degrees, and jobseeker is pathetic,” she said. “You can’t study in the heat. And it impacts our kids, too.
“I was really hopeful that the Labor party would get in [to federal government] and do something to help people, increase welfare payments, but I don’t know if they’re going to. But it’s really essential.”
Acoss called on commonwealth, state and territory governments to prioritise retrofitting public and community housing for improved energy efficiency – ideally, making them entirely electric and powered by renewables – as well as mandating minimum energy efficiency standards for all rentals.
The report reiterated Acoss and other advocacy organisations’ long-running calls to substantially lift income support payments to at least $73 per day, boost commonwealth rent assistance, and to index those payments to wages as well as the consumer price index.
Acoss chief executive Cassandra Goldie said the survey again showed how the climate crisis affected people on low incomes “first, worst, and longest”.
“Too many people are living in housing that is poorly insulated and far too hot in summer. Soaring energy bills and woefully inadequate income support levels mean they cannot afford to keep themselves cool – and this is having a serious impact on their physical and mental health,” Goldie said.
She called on the federal government to provide debt relief to struggling Australians and invest in energy efficiency for low-income housing in the May budget. | Australia Business & Economics |
A prominent Conservative donor has threatened to stop supporting the party if Rishi Sunak scraps the Birmingham to Manchester leg of HS2, as ministers consider pulling the plug on the multibillion-pound project.
Fears that phase 2 of the high-speed rail line could be junked were compounded on Sunday when Grant Shapps, the defence secretary, said it would be “crazy” not to review the plan in light of spiralling costs.
A decision is expected to be taken by the prime minister, Rishi Sunak, and the chancellor, Jeremy Hunt, early next week with an announcement pencilled in for Friday.
However, northern Tories believe that scrapping the northern leg before the Conservative party conference in Manchester next weekend would be a major political embarrassment. They are urging Sunak to wait until closer to the autumn statement in November while they push for a compromise solution.
A major donor to the party, who asked to remain anonymous, told the Guardian: “Generations of my family have been proud to support what was the party of business. We’ve given year in, year out for decades and been active in the party.
“But I’ve spoken to other donors, and several of them feel – possibly for the first time ever – recent events seriously call into question the ability to continue to support people who don’t do what they say they’d do.”
It follows a similar move by the billionaire Phones4U founder, John Caudwell, who said he would stop donating to the Conservatives after the “madness” of Sunak’s U-turn on climate goals.
Concerns have been raised by business leaders and regional mayors that any watering down of HS2 would further damage investor confidence, hinder the levelling up agenda and turn the project into a white elephant.
Critics of HS2 agree that elevated costs should be assessed, along with the structuring of HS2 Ltd and its oversight by the Department for Transport. However, the idea the second phase – from north of Birmingham – could be scrapped has gained traction over the past 10 days.
The Birmingham to London section was initially set to finish at Euston in central London. Sunak and Hunt are also deciding whether to terminate that leg at Old Oak Common, in the west of the capital, which originally was planned as an interchange. The Sunday Telegraph reported it was likely to end up being £8bn more than the expected £45bn price tag put on it in June 2022.
Further briefings have suggested Sunak is minded to axe the second phase of the project owing to fears it could hit £100bn. Speculation intensified after Hunt said the HS2 budget was “getting totally out of control”.
One source also told the Guardian that Andrew Gilligan, a former transport adviser who called for all parts of HS2 where constriction has not yet started to be cancelled, was back informally advising the government.
Shapps, who is a former transport secretary, declined to dampen down suggestions that costs could be significantly cut back over the weekend. He told the BBC’s Sunday with Laura Kuenssberg the government should ask itself: “Does this still stack up for what the country requires, in terms of where it’s spending its resources, and at what time?”
The shadow chief secretary to the Treasury, Darren Jones, said Labour “would like to see HS2 built in full” but stopped short of committing to do so until the government had laid out the full cost overruns.
Northern Tory MPs are lobbying for a compromise. They are pushing for phase 2B – from Manchester to Crewe – to be built first, to unlock further benefits under the Northern Powerhouse Rail (NPR) project. Phase 2A – Crewe to Birmingham – they say could be pushed further into the long grass.
As part of his rationale for watering down several net zero targets, Sunak said he wanted to overhaul “short-termist” decision-making in government and that he would do things for the good of the country’s future even if they were unpopular.
However, Henri Murison, chief executive of the Northern Powerhouse Partnership, said: “I met with Rishi Sunak after he convinced Boris Johnson to make NPR his top domestic priority. I don’t believe a man of honour or integrity would do this. It seems strange he’s forgotten about what he believed before he became prime minister.”
The combination of Sunak’s net zero row-back and the mooted changes to HS2 were also criticised by Jürgen Maier, a former chief executive of Siemens UK. He said: “The business community is in total shock and investor confidence is as low as I have ever seen it in my long years of engaging with our government.”
A government spokesperson said: “The HS2 project is already well under way with spades in the ground, and our focus remains on delivering it.”
An HS2 spokesperson said: “We are building a railway that will level up the country and serve the needs of Britain for the next hundred years and beyond.
“Money spent on HS2 gives immediate returns, with 30,000 British jobs and thousands of British businesses already benefiting, years before the first trains run and the bulk of the benefits are realised.
“The UK has experienced sustained and much higher than expected levels of inflation, affecting all parts of the economy including HS2.
“We’re currently working with our supply chain partners to carry out a detailed assessment of genuine levels of inflation, as well as the impact of the Covid pandemic and the rephasing of parts of the project.” | United Kingdom Business & Economics |
Colorado residents are deciding whether to siphon off a state tax refund that’s unique in the U.S. to help homeowners offset hikes in property taxes after years of rising home prices.
If passed in the election Tuesday, the proposition would lessen property tax increases for homeowners over the next decade in return for decreasing a state tax refund called the Taxpayer Bill of Rights or TABOR.
TABOR caps Colorado's tax revenue and requires the surplus to be redistributed to residents. Last year, TABOR provided $750 to each taxpayer.
Under the measure, property taxes won’t drop below previous levels, but the expected future increases in bills would be dampened.
The owner of a $500,000 home would pay anywhere from $186 to $276 less in property taxes this year than they would if the ballot measure didn’t pass, depending on local tax rates, according to estimates by legislative analysts.
In exchange, after an initial increase in the taxpayer refund for everyone this year, the refund checks will start to decrease and possibly disappear for people of all income levels over the next decade, depending on how much revenue the state takes in, according to legislative analysts.
And renters will get those smaller taxpayer refunds without getting any of the direct relief that homeowners do.
The measure will allow the state to keep 1% more money each year than is allowed under TABOR. The money will be used to reimburse local governments for some of the money they are losing due property tax bills that won't increase as much as they normally would and fund schools. Up to $20 million of the extra money would also be set aside for rental assistance.
Proponents of Proposition HH say it’s the best way to prevent devastating property tax bill increases and is targeted at helping older residents and working families. Opponents, including Republican state lawmakers and conservative groups, argue the measure could ultimately cost taxpayers more than they save on property tax bills.
The owners of primary residences will see greater reductions than the owners of second homes and rental properties. The complicated measure would also allow residents 65 and older to take an existing property tax break with them if they decide to downsize to another home. Currently, they only get that break if they have lived in a home for 10 years.
This year taxpayers will each get an estimated $898 — $148 more than last year — in a flat taxpayer refund. But then starting in 2024 the refund will revert to the traditional method of being determined by income and start to decline below even what the old rules would dictate.
People with an adjusted gross income of $52,000 or less are projected to get a $326 refund next year, $31 less than under current law. Those with an income of $289,001 or more are expected to get checks for $1,028, $100 less.
Put on the ballot by the Democratic-led Legislature, the property tax measure slows the increase of property tax bills over the next decade in two ways. Proposition HH lowers the statewide assessment rate that is used to calculate how much people have to pay to their local governments based on the value of their homes. It also exempts a portion of a home’s value from being taxed.
The measure lowers the statewide assessment rate slightly from 6.765% to 6.7. The rate is set to increase to 7.15% in 2025 but would stay at 6.7% under the measure. It also exempts $50,000 of the value of the home from being taxed in 2023 and $40,000 in 2024. It would also limit the growth in property tax revenue for local governments.
Backers of the measure say the owner of a $723,000 home, the median sale price for the last assessment period, would save an average of $685 a year in property taxes over the next decade the measure is in effect. That's based on how they believe local governments will respond to the limit.
In the latest tax assessments this year, residential property values increased by between 35% and 45% in the Denver area and up to 60% in parts of the mountains. So homeowners will still get bigger property tax bills for this year compared to last year, but they will be lower than they would have been without the measure.
Voters are also deciding a second tax measure that would permit millions more dollars from a tobacco tax to be spent on the state’s new universal preschool program.
It deals with taxes on cigarettes and tobacco products approved by voters in 2020. Analysts underestimated how much it would take in so, under the Taxpayer’s Bill of Rights, voters must be asked if the state can keep the extra $23.65 million the taxes brought in in the first year, including interest, or whether it should be refunded. | Real Estate & Housing |
Australia’s employers added more jobs than expected last month as the economy’s resilience contributed to a tight labour market – keeping open the possibility of another Reserve Bank interest rate rise.
The unemployment rate rose in October to 3.7%, with a net 54,900 jobs added for the month, the Australian Bureau of Statistics reported on Thursday. Of those, 17,000 were full-time positions.
Market economists had predicted the jobless rate would rise to 3.7% from September’s reported 3.6% level but with just 24,000 jobs to be added.
The participation rate, which tracks the share of the population in work or looking for it, bounced 0.2 percentage points back to its record 67%.
However, Bjorn Jarvis, the ABS’s head of labour statistics, said other measures, such as hours worked, showed some easing. October’s job jump followed an 8,000 gain in September.
“Looking over the past two months, these increases equate to average employment growth of around 31,000 people a month, which is slightly lower than the average growth of 35,000 people a month since October 2022,” Jarvis said.
The annual growth in hours slowed to 1.7%, down from about 5% in the middle of the year, and less than the annual employment growth of 3%, he said.
The jobs figures follow Wednesday’s ABS release showing the wage price index had risen 1.3% in the September quarter, the largest quarterly increase in the survey’s 26-year history. The annual pace of 4% was also the most in more than 14 years.
The strength of the underlying economy prompted the RBA to lift its forecast last week for gross domestic product growth. It also predicted the jobless rate would rise to about 4.3% by next June, less than a previously forecast peak of about 4.5%.
Prior to Thursday’s labour market figures, investors had rated the chance the RBA would follow this month’s interest rate rise with another in December as less than 10%. They were also betting the odds of an interest rate increase next year at less than a 50-50 chance, according to the ASX.
In the immediate wake of Thursday’s data, the dollar was slightly lower, trading at just over the 65 US-cent mark. Stocks were holding on to losses of about 0.25% for the day.
Stephen Wu, a senior CBA economist, noted the October jobs figures were boosted by a “temporary effect on employment, hours and participation” from the Aboriginal and Torres Strait Islander Voice referendum held on 14 November.
“Given that, we could expect some payback next month, perhaps more so in employment, given that was stronger than expected,” Wu said, adding that the October consumer price index figures for October “will be the one to watch” in terms of data releases before the 5 December RBA board meeting.
Warren Hogan, chief economic advisor at Judo Bank, said the jobs figures were “amazing” and evidence of an economy “operating beyond its capacity”.
Researchers would be studying “an economic experiment for years to come” as Australia continued to absorb a surge in job seekers as the population swells, he said
Hogan said the chance of 14th RBA rate rise on 5 December was still probably less than 50:50 but the bank board won’t meet again until February and will hold six-weekly gatherings after that.
“Demand for labour is still very strong,” he said. “We’re not looking at a normal cycle.”
Youth unemployment rose to 8.7% last month, while the total number of unemployed people rose 27,900, reflecting the higher participation rate.
Among the states, New South Wales boasted the lowest jobless rate at 3.4%, seasonally adjusted, up from 3.3% in September. Victoria’s unemployment rate jumped from 3.5% to 3.8%, Queensland’s rose from 3.9% to 4.3%, and Western Australia’s increased from 3.3% to 3.8%. Other states were steady or slightly lower. | Australia Business & Economics |
NEWYou can now listen to Fox News articles! Appearing on CNBC’s Squawk Box Friday morning, author and biotech entrepreneur Vivek Ramaswamy blasted the Biden administration for blaming oil companies for current high gas prices and less oil production.The businessman reminded viewers that less oil production had always been a "specific policy aim" of the Biden administration, before calling the current White House energy policy "senseless."Ramaswamy spoke to CNBC anchor Joe Kernen, who began the discussion by slamming President Biden for telling the American people he’s doing everything he can to lower the price of oil, even though Biden’s previously stated policy was to "cut oil production.""Vivek, do you think that the Biden Administration has done all it can to try to get U.S. domestic production rolling? It just – the pivot from ‘we want to cut production to transition to clean energy’ that they’re so proud of, ‘I’m going to shut down the fossil fuel industry,’" Kernan asked, referring to Biden’s green campaign promise. HISTORIC $5 GAS EXPOSES BIDEN'S ENERGY DELUSION PHILADELPHIA, PA - OCTOBER 05: Vivek Ramaswamy, Founder & CEO of Rolvant Sciences speaks at Forbes Under 30 Summit at Pennsylvania Convention Center on October 5, 2015 in Philadelphia, Pennsylvania. (Photo by Lisa Lake/Getty Images) "Suddenly they seem to distance themselves from that. ‘No, it never happened. We never tried to cut production,’ when that was a stated goal," the anchor added, referencing Biden’s recent letter to oil CEOs. The president lectured to the company executives that they "have an opportunity to take immediate actions to increase the supply of gasoline."The businessman agreed with Kernan’s point, claiming, "I find it ironic that the Biden administration is now blaming oil companies for producing less oil when this was an explicit policy aim, one of the top policy aims of the administration."Throughout the 2020 presidential campaign, then-candidate Biden promised to transition American energy away from fossil fuels.During a trip to Tokyo, Japan last month, the president also mentioned that current high gas prices represent "incredible transition that is taking place that, God willing, when it’s over, we’ll be stronger, and the world will be stronger and less reliant on fossil fuels." Vivek Ramaswamy told CNBC's Squawk Box that the Biden administration has 'senseless' energy policy Ramaswamy continued, "And you can listen to John Kerry this week, saying that we absolutely should not be drilling for more oil. Not only the revoking of permits to drill on federal land, I’ll also remind you the subsidies for wind and solar of course increase the relative cost of capital for any kind of oil production project."BIDEN WEIGHS SENDING REBATES TO AMERICANS BEING CRUSHED BY SKYROCKETING FUEL PRICES UNDER HIS WATCHHe then pointed to Biden’s cutting of the Keystone XL Pipeline as hampering the energy supply in the country. "And furthermore if you think about the Keystone pipeline project – this is the one that hurts me personally as I view the situation as a citizen the most – that would have been 840,000 barrels of oil per barrel a day from the tar sands of Alberta to the Gulf Coast of Mexico."The entrepreneur then slammed the Biden administration for trying to get the world’s dictators to supply us with energy over constructing the pipeline between America and Canada. "Let’s keep in mind that Canada is a democratic nation and ally and instead you have this administration now, shamefully in my opinion, begging dictators from countries like Venezuela to Saudi Arabia to produce more oil.""But the worst part of this geopolitically actually, Joe," the businessman continued, "… it was the fact that the Biden administration was among the few parties lobbying the EU against adopting the Russian oil import ban. Keep in mind this is what’s actually financing Putin’s war machine even as the United States with the other hand sends $40 billion to Ukraine to fight against Russia." Fuel prices at a Chevron gas station in Menlo Park, California, US, on Thursday, June 9, 2022. Stratospheric Fuel prices have broken records for at least seven days with the average cost of fuel per gallon hitting $4.96 as of June 8, according to the American Automobile Association. (Photographer: David Paul Morris/Bloomberg via Getty Images)CLICK HERE TO GET THE FOX NEWS APPThe Squawk Box guest added, "I think this is senseless policy, it’s clearly an ironic criticism because this was the exact policy aim implemented by the Biden administration in the first place." Gabriel Hays is an associate editor at Fox News. Follow him on Twitter at @gabrieljhays. | Energy & Natural Resources |
The chits for years of inflationary green energy policies are coming due to record-high energy prices and unreliable electrical grids. Average national gasoline prices have soared to a record high of $5 a gallon. The price of natural gas, which heats many homes in America, has roughly tripled over the last year. And electric grid monitors nationwide are warning of blackouts and brownouts this summer. These effects on ordinary residents' living standards require an immediate national environmental policy rethink, reflecting a new appreciation of cheap, reliable energy. While Russia's war on Ukraine and easy monetary policy have contributed to rising energy prices, policymaker opposition to traditional energy production and distribution is also a big reason for price increases. The Biden administration canceled the Keystone XL pipeline, banned oil and gas leases on federal land, and implemented numerous new burdensome regulations on production. Last year's federal infrastructure legislation created a state carbon dioxide reduction mandate. Net-zero requirements at all levels of government and from many institutions reject traditional energy. This matters because the price of energy is ultimately a function of supply and demand. On the same basis, however, policymakers can immediately help lower energy costs by reversing costly green policies. They should strongly champion oil and gas development and distribution. Unfortunately, President Joe Biden invoked the Defense Production Act last week to boost green energy. Yet, given the capacity constraints of solar and wind power, this constitutionally troubling action will only make a marginal difference in electricity prices. Democrats appear to have few answers. Michigan Sen. Debbie Stabenow has suggested people should purchase expensive electric vehicles to overcome high gas prices. Transportation Secretary Pete Buttigieg has urged people to take the bus (but will he join them?). Instead, the public has been told again and again that a green energy revolution is needed to stave off the "climate crisis." However, the clear consensus among energy experts at the Steamboat Institute's recent
Energy and Climate Summit
is that officials are ignoring the benefits of fossil fuels and presenting the consequences as catastrophic. The share of global carbon dioxide produced by the United States has fallen by nearly half, from 24% to 13%, since the year 2000. Expensive policies that address this small share of global CO2, while giving other big economies such as China and India free rein to keep on emitting, will not meaningfully affect climate change but will have a significant impact on our quality of life. Sadly, such views are verboten in polite company. Energy experts who espouse them are routinely maligned as "climate deniers." For too long, environmentalists have portrayed green energy policies as a free lunch. Runaway prices and reduced reliability are the bills that are now arriving. A new environmental and energy policy approach should begin with the consensus that there is no dichotomy between cheap, reliable energy and saving the planet, yet there is one between aggressive green energy policies and our continued prosperity and living standards. We are seeing the latter play out in real-time.
Jennifer Schubert-Akin is the chairman, CEO, and co-founder of the Steamboat Institute. | Energy & Natural Resources |
Bottles of Cointreau, the orange-flavoured triple sec liqueur, are displayed at the Carre Cointreau in the Cointreau distillery in Saint-Barthelemy-d'Anjou near Angers, France, February 8, 2019. REUTERS/Stephane Mahe/File PhotoRegister now for FREE unlimited access to Reuters.comSummaryCompaniesQ1 sales 409.9 mln euros, up 27% organic vs est. 19.1%China sales up double-digit in June, down double-digit April-MayEyes strong sales growth, op margin improvement in FY 2022/23PARIS, July 26 (Reuters) - Remy Cointreau (RCOP.PA) said it was confident over prospects for its current financial year, after first-quarter sales beat expectations and cognac sales strongly recovered in the key Chinese market in June.The maker of Remy Martin cognac and Cointreau liqueur said its business in China saw a double-digit sales rebound last month, having suffered from COVID lockdowns in April-May, and also benefited from strong demand in Europe and the United States.The Paris-based group said its current year through March 2023 would be another year of strong growth and improvement in its current operating margin, as price increases and strict cost control would mitigate inflationary pressures.Register now for FREE unlimited access to Reuters.comThe pandemic has helped Remy Cointreau's long-term drive towards higher-priced spirits to boost profit margins, speeding a shift towards premium drinks, at-home consumption, cocktails and e-commerce.Remy Cointreau reported a rise of 27% in organic or self-generated sales to 409.9 million euros ($419 million) in the three months ended June 30, versus a forecast of 19.1% seen in a company-compiled poll of 20 analysts.By 0701 GMT, Remy Cointreau shares gained 1.5% at 185 euros."We believe the comments around the strong double-digit recovery in China in June, and low level of inventories at the end of Q1, bode well for Q2, whilst the benefit of a 3-5% forex upgrade following recent euro weakness should also be taken favourably," Credit Suisse analysts said in a note.Sales at the Remy Martin division, which makes up the bulk of group profit, rose 31.5% in the quarter to 292.3 million euros, beating expectations of 22.3% growth.In the United States, Remy Cointreau said it enjoyed sustained demand for its high-end and mid-range cognacs, Louis XIII, Remy Martin XO and 1738 Accord Royal.It also benefited from restocking as the fourth quarter of 2021-22 was marked by a decision to manage strategic inventories.Sales in China were temporarily affected by strict lockdown measures until May, but business was boosted by a double-digit resumption in sales in June and excellent growth in e-commerce. Overall global inventory level remained "extremely healthy", it said.For the full year 2022/23 Remy forecast a positive currency effect with reported sales now seen at between 90 million euros and 100 million, compared with 70-80 million previously, and current operating profit at 50-60 million compared with 30-40 million previously.($1=0.9779 euros)Register now for FREE unlimited access to Reuters.comReporting by Dominique Vidalon; Editing by Clarence Fernandez and David HolmesOur Standards: The Thomson Reuters Trust Principles. | Europe Business & Economics |
The External Affairs Minister made the above remarks while addressing a joint press briefing with the Foreign Minister of Panama, Janaina Tewaney Mencomo, in Panama City. The press briefing followed a discussion on several bilateral issues related to health and trade.
Jaishankar said, "The bottom line on this issue is it is for us very difficult to engage with a neighbour who practices cross-border terrorism against us. We've always said that they have to deliver on the commitment not to encourage, sponsor and carry out cross-border terrorism. We continue to hope that one day we would reach that stage."
EAM Jaishankar is on a two-day visit to Panama. He arrived in Panama City on Monday and was received by Panama's Vice Minister for Foreign Affairs Vladimir Francos.
Taking to his official Twitter handle, Jaishankar stated, "Arrived in Panama City. Thank Vice Minister for Foreign Affairs @VladimirFrancoS for the warm reception. Look forward to a packed bilateral and multilateral agenda."
EAM Jaishankar also attended the India-Latin America Business event and delivered a keynote address highlighting ten important reasons why the India-Panama business collaboration has strong prospects and merits-focused endeavours.
After his visit to Panama, the EAM on April 25 will embark on a Colombia visit where he will be meeting several top representatives of the Government, business and civil society. His Colombia visit would be the first Foreign Ministerial level visit to the country, the Ministry of External Affairs said in its release.
Jaishankar and Colombia's counterpart Alvaro Leyva Duran will review the bilateral ties. Following his visit to Colombia, Jaishankar will head to the Dominican Republic, according to an MEA release.
The visit to the Dominican Republic is the highest-level visit from India since the establishment of diplomatic ties in 1999. Jaishankar's visit takes place after the establishment of India's resident Embassy in Santo Domingo in 2022.
Besides calling on the country's political leadership, EAM will be discussing with Foreign Minister Roberto Alvarez. The two leaders will formally inaugurate the Indian resident mission. EAM is also expected to deliver a talk at the Dominican Republic Foreign Ministry.
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President Biden’s bet on a rapid rebound from the coronavirus recession may have backfired. The president and his top economic officials rallied Democrats around a $1.9 trillion stimulus bill in March 2021, urging Congress not to repeat the mistakes of the Great Recession and cut off support for the economy too soon. The bill was also Biden’s way of delivering on the promise made during the pivotal Georgia Senate runoffs, which gave his party a slim Senate majority: elect Democrats and get another round of stimulus checks. Just more than a year after Biden signed the bill, U.S. unemployment rate is nearly at pre-pandemic levels, the economy has added more than 10 million jobs and gross domestic product is well above where it was when COVID-19 shattered the economy. By those measures alone, the recovery under his watch was far stronger than the slow trudge out of the Great Recession. But despite the rapid rebound, Biden’s approval rating is at all-time lows as Americans feel the brunt of high inflation — a risk few within and beyond the administration took seriously when he signed the American Rescue Plan (ARP). Consumer prices rose 1 percent in May alone and by 8.6 percent over the past 12 months, according to data released Friday by the Labor Department. Prices for food, gasoline, shelter and travel led the May inflation burst, giving Americans few ways to avoid higher prices. “The Fed and the White House were trying to avoid the kind of long slog, decade-long recovery that there was after the Great Recession,” said Skanda Amarnath, executive director at research nonprofit Employ America. “For some people, there was a certain complacency about inflation as a possibility. That’s probably true too. But that was viewed as a much more remote tail risk.” It’s a risk voters are feeling. Eighty-five percent of voters said they think inflation is a very serious or somewhat serious problem, according to an Economist-YouGov poll from earlier this month. In the same, poll, 44 percent of respondents said Biden has “a lot” of responsibility for the inflation rate, and 31 percent said he has “some.” Top Biden administration and Fed officials — along with dozens of economists — expected inflation to cool off last year as the world adjusted to life after COVID-19. Vaccination campaigns, reopening schools and a shift in spending from goods to services all figured to bring prices down and workers back into the job market. But COVID-19 adjusted quicker. The emergence of the delta and omicron variants didn’t curb consumer spending or cost the economy jobs. Instead, it shifted a glut of saved-up money toward goods, which had been in high demand since the start of the pandemic, instead of services. The new variants also led to factory shutdowns, port backlogs and other pandemic-related snarls, making it even harder for manufacturers and suppliers to meet higher demand powered in part by federal stimulus. “Inflation wasn’t transitory because COVID was not transitory. Parts of China are still locked down. We’re not even through the COVID shock,” said Claudia Sahm, a former Federal Reserve research director. And while some of those pressures have begun to ease, the war in Ukraine has pushed inflation even higher with severe shocks to the global supply of oil, natural gas, wheat and other crucial commodities. “There were people at the time who said given the gap, given how many people we have out of work, the American Rescue Plan is more than enough. That seems it could be especially true if you counted the excess savings as energy stored in the battery that could be used to get the economy rolling,” said Alan Cole, former chief economist for Republicans on the Joint Economic Committee. “The U.S. has had higher inflation generally than most advanced economies, and I don’t think anyone’s saying the ARP created all of it — or if they are, they are not telling the truth. But the ARP kind of contributed more at the margins.” Republican lawmakers, who voted in unison against the American Rescue Plan, have claimed vindication after warning Biden’s bill would trigger an inflation spiral. GOP lawmakers have centered their midterm campaign message — including their response to the Capitol riot investigation — around Biden’s failure to keep prices stable as the economy expanded. “[My] constituents ask me about the historic gas prices, skyrocketing inflation, and the baby formula shortage,” tweeted Rep. Elise Stefanik (N.Y.), the third-ranking House Republican, on Thursday. “Why aren’t Democrats holding primetime hearings about these crises impacting the American people?” Stefanik’s barb came two days after Treasury Secretary Janet Yellen admitted to lawmakers during House and Senate hearings that the administration misjudged inflation and likely spurred it higher through the stimulus plan. Yellen defended the American Rescue Plan’s role in spurring the economy, though she acknowledged how critical it would be for the administration to balance out its impact on the economy. Most economists say it’s hard to blame the White House for trying to repair the economy as quickly as possible. Even former Treasury Secretary Larry Summers, the top Democratic critic of Biden’s economic policy, spurned the stimulus package because he believed the money would be better spent on the president’s broader Build Back Better agenda. That bill has fallen by the wayside amid concerns from Sen. Joe Manchin (D-W.Va.) about its potential impact on inflation. Even so, experts agree there is far more Biden could do to try to bring prices down. In a fiery Friday speech, Biden blasted Big Oil companies for reeling in record profits instead of expanding production with gas prices above $5 per gallon on average nationwide. “Why don’t they drill more? Because they make more money not producing oil. Prices go up on the one hand. No. 2, the reason they are not drilling is they are buying back their own stock, should be taxed quite frankly. Buying back their own stock and not making new investments,” he said. But Amarnath, of Employ America, said Biden should work with the industry to increase output through agreements to purchase oil for the Strategic Petroleum Reserve at set prices, giving them cover if market prices for oil go down amid the glut of products. Amarnath also said the U.S. government should deploy the Treasury Department’s exchange stabilization fund to help keep prices down for crucial commodities hindered by the war in Ukraine, sanctions on Russia and Chinese lockdowns. “Having some individualized attention on these markets would help, but you’d have to really do that systematically ahead of time. That takes a lot of work and that kind of work, just to be blunt, doesn’t happen anywhere within the government.” Sahm, the former Fed research director, also expressed concerns about Biden’s plan to lean on the Fed to bring down inflation when much of the forces driving prices higher are beyond the bank’s control. “[The Fed] should have moved sooner last year and it probably would have had some effect on inflation, but it would have had no effect on food and gas prices,” Sahm said. “When the Fed lowers inflation, it does it by reducing people’s ability to spend. It’s not a happy way that we get inflation down,” she continued. “The Fed’s lever is impoverishing people. Hardship in the United States is never equally shared.” | Inflation |
A person shops for meat in a supermarket in Manhattan, New York City, U.S., August 8, 2022. REUTERS/Andrew KellyRegister now for FREE unlimited access to Reuters.comNEW YORK, Aug 10 (Reuters) - U.S. consumer prices decelerated in July as gasoline prices dropped sharply, raising hopes the U.S. Federal Reserve may dial back its aggressive path of interest rate hikes.The consumer price index was unchanged last month after advancing 1.3% in June, the Labor Department said on Wednesday. In the 12 months through June, the CPI climbed 8.5%, below expectations of an 8.7% rise and after a 9.1% rise in June. read more MARKET REACTION:Register now for FREE unlimited access to Reuters.comSTOCKS: S&P 500 futures turned sharply higher, and were up 1.7%BONDS: The yield on 10-year Treasury notes was down 7.3 basis points to 2.724%; The two-year U.S. Treasury yield, was down 15 basis points at 3.136%.FOREX: The dollar index fell 1.166%COMMENTS:TIM GHRISKEY, SENIOR INVESTMENT STRATEGIST, INGALLS & SNYDER, NEW YORK"It's quite a surprise and that's why the market is reacting so positively. Is this a solid indication inflation is waning? It's too early to make that statement. On the other hand assuming this data doesn't get revised it's certainly good news for the economy."It seems like an extreme reaction to one data point. We've PPI tomorrow and that could show a different story. These measures don't march together. The Fed's preferred measure of inflation is PCE. It's more stable than CPI and PPI."Certainly it will add to the inflation data the Fed looks at but it's not going to rely on this one number. The fed is determined to drive inflation lower and one month is not going to change their resolve. It could be an aberration and we could see a revision."I’m cautiously optimistic about this data but I'm not ready to declare that the Fed is victorious.”THOMAS HAYES, CHAIRMAN AND MANAGING MEMBER, GREAT HILL CAPITAL, NEW YORK“As expected, we finally saw a reprieve. This now brings the idea of a Fed 'pivot' or slowdown (in hikes) back on the table after Friday’s strong jobs report took it off.”QUINCY KROSBY, CHIEF GLOBAL STRATEGIST, LPL FINANCIAL, FORT MILL, SOUTH CAROLINA“We are seeing the futures market enjoying the positive surprise, the lower-than-consensus estimate. Still, inflation remains intact, but it is moving in the right direction. The question is for the Fed does it have to continue its aggressively hawkish rhetoric? The question is does inflation to continue to ease?“What you are seeing is the market enjoying the possibility of the Fed moving toward a less hawkish, not dovish, but slightly less hawkish stance.It’s obviously showing up in the fed funds futures market.”BRIAN JACOBSEN, SENIOR INVESTMENT STRATEGIST, ALLSPRING GLOBAL INVESTMENTS, MENOMONEE FALLS, WISCONSIN“Hopefully the tide is finally turning on inflation. The Fed might not find this one report compelling enough to act on, but at least it leaves open a slowdown in the pace of hikes come September.”PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK“We got some good inflation news. Obviously, we’re seeing some a relief in transitory inflation, including agriculture and oil and things of that nature. But we still see sticky points.“This is an indication that we’re going in the right direction. Does this raise the possibility of the Fed changing its tune? I suspect not. We should still see a 50 to a 75 basis point (interest) rate hike in September.“It’s good news for the stock market. Stock futures are up, yields are down sharply.“Technically speaking, we’re in a recession. A peculiar one, but a recession. Remember, that if the Fed raises rates in September, that’s just going to slow the economy even further.“The consumer is getting some relief. Gas prices are coming down, food prices are beginning to stabilize, so that’s good news for the consumer.“We’re having some relief from the war effect, we’re seeing that in energy, in grains and wheat.”STEVEN RICCHIUTO, U.S. CHIEF ECONOMIST, MIZUHO SECURITIES USA LLC, NEW YORK“The market reaction to the details is more correct than incorrect. The details show some pretty big declines in components like air fares, hotels, energy. It also shows some nice declines in used car prices. All of that was better than expected, pulling it down.“This is part and parcel of what happens when you have an index of lots of things, you have very little information ahead of time for what is forecasted. The big surprise to us was the energy pulldown. But again, people were expecting that more than we were. We thought the energy would be a little bit on the higher side.“When you look at the numbers it tells you inflation probably peaked in the month of June. Is it settling rapidly enough for the Federal Reserve? My view continues to be that the Fed needs to see a 3 percent point deceleration from the peak, and the peak in the headline number was 9.1%. You need it to come down into the 6’s at least for them to say they have a substantive decline, and you’re at 8.5%.”Register now for FREE unlimited access to Reuters.comCompiled by the Finance and Markets Breaking News teamOur Standards: The Thomson Reuters Trust Principles. | Inflation |
SYDNEY, Sept 27 (Reuters) - Elon Musk's X, formerly called Twitter, disabled a feature that let users report misinformation about elections, a research organisation said on Wednesday, throwing fresh concern about false claims spreading just before major U.S. and Australian votes.
After introducing a feature in 2022 for users to report a post they considered misleading about politics, X in the past week removed the "politics" category from its drop-down menu in every jurisdiction but the European Union, said the researcher Reset.Tech Australia.
Users could still report posts to X globally for a host of other complaints such as promoting violence or hate speech, the researcher added.
X was not immediately available for comment.
Removing a way for people to report suspected political misinformation may limit intervention at a time when social media platforms are under pressure to curtail falsehoods about electoral integrity, which have grown rapidly in recent years.
It comes less than three weeks before Australia holds a referendum, its first in a quarter century, on whether to change the constitution to establish an Indigenous advisory body to parliament and 14 months before a U.S. presidential election.
"It would be helpful to understand why X have seemingly gone backwards on their commitments to mitigating the kind of serious misinformation that has translated into real political instability in the US, especially on the eve of the 'bumper year' of elections globally," said Alice Dawkins, executive director of Reset.Tech Australia.
In a letter to X's managing director for Australia, Angus Keene, Reset.Tech Australia said the change may leave content that violates X's own policy banning electoral misinformation online without an appropriate review process.
"It is extremely concerning that Australians would lose the ability to report serious misinformation weeks away from a major referendum," said the letter which was published online.
Since billionaire Musk took Twitter, as it was then known, private in late 2022, the company, which cut most of its workforce, has been accused of allowing the proliferation of antisemitism, hate speech and misinformation.
As previously reported by Reuters, Reset.Tech Australia found X failed to remove or label a single post containing misinformation about the Australian referendum over a three-week period, including after it was reported using the now-disabled feature.
Musk has said X's "Community Notes" feature, which allows users to comment on posts to flag false or misleading content, is a better way of fact checking. But those notes are only made public when they are rated as helpful by a range of contributors with varying points of view, according to X's website.
Australia's internet safety regulator wrote to X in June demanding an explanation for an explosion in hate speech on the platform, noting it had reinstated some 62,000 high profile accounts of individuals who espouse Nazi rhetoric.
The Australian Electoral Commission (AEC), which will oversee the Oct. 14 referendum, has said the spread of electoral misinformation is the worst it has seen.
The commission said it was still able to report posts containing political misinformation directly to X, even after the feature was disabled. For other users, the AEC was "available for people to ask questions or seek information".
Reporting by Byron Kaye; Editing by Sonali Paul
Our Standards: The Thomson Reuters Trust Principles. | Australia Business & Economics |
WASHINGTON — Record-low mortgages are long gone. Credit card rates will likely rise. So will the cost of an auto loan. Savers may finally see a noticeable return.The unusually large three-quarter point hike in its benchmark short-term rate that the Federal Reserve announced Wednesday won’t, by itself, have a huge effect on most Americans’ finances. But combined with earlier rate hikes and additional large increases to come, economists and investors foresee the fastest pace of rate increases since 1989.The result is increasingly higher borrowing costs as the Fed fights the most painfully high inflation in four decades and ends a decades-long era of historically low rates.Chair Jerome Powell hopes that by making borrowing more expensive, the Fed will succeed in cooling demand for homes, cars and other goods and services and slow inflation.Yet the risks are high. With inflation likely to stay elevated, the Fed may have to drive borrowing costs even higher than it now expects. A series of higher rates could tip the U.S. economy into recession. That would mean higher unemployment, rising layoffs and continued pressure on stock prices.How will it affect your finances? These are some of the most common questions being asked about the impacts of the rate hike.Rates on home loans have soared in the past few months, mostly in anticipation of the Fed’s moves, and will probably keep rising.Mortgage rates don’t necessarily move up in tandem with the Fed’s rate increases. Sometimes, they even move in the opposite direction. Long-term mortgages tend to track the yield on the 10-year Treasury note, which, in turn, is influenced by a variety of factors. These include investors’ expectations for future inflation and global demand for U.S. Treasurys.An advertising sign for building land stands in front of a new home construction site in Northbrook, Ill., May 5, 2022. (Nam Y. Huh/AP)For now, though, faster inflation and strong U.S. economic growth are sending the 10-year Treasury rate up sharply. As a consequence, the national average for a 30-year fixed mortgage has jumped from 3% at the start of the year to well above 5% now.In part, the jump in mortgage rates reflects expectations that the Fed will keep raising its key rate. But its forthcoming hikes aren’t likely fully priced in yet. If the Fed jacks up its key rate even higher, as expected, the 10-year Treasury yield will go much higher, too, and mortgages will become more expensive.If you’re looking to buy a home and are frustrated by the lack of available houses, which has triggered bidding wars and eye-watering prices, that may get a little easier soon.Economists say that higher mortgage rates will discourage some would-be purchasers. And average home prices, which have been soaring at about a 20% annual rate, could at least rise at a slower pace.Sales of existing homes have fallen for six straight months. New home sales have also slumped. Those trends are modestly boosting the supply of available properties.Fed rate hikes can make auto loans more expensive. But other factors also affect these rates, including competition among car makers that can sometimes lower borrowing costs.Rates for buyers with lower credit ratings are most likely to rise as a result of the Fed’s hikes. Because used vehicle prices, on average, are rising, monthly payments will rise too.For users of credit cards, home equity lines of credit and other variable-interest debt, rates would rise by roughly the same amount as the Fed hike, usually within one or two billing cycles. That’s because those rates are based in part on banks’ prime rate, which moves in tandem with the Fed.Those who don’t qualify for low-rate credit cards might be stuck paying higher interest on their balances. The rates on their cards would rise as the prime rate does.The Fed’s rate increases have already sent credit card borrowing rates above 20% for the first time in at least four years, according to LendingTree, which has tracked the data since 2018.You may earn a bit more, though not likely by very much. And it depends on where your savings, if you have any, are parked.Savings, certificates of deposit and money market accounts don’t typically track the Fed’s changes. Instead, banks tend to capitalize on a higher-rate environment to try to increase their profits. They do so by imposing higher rates on borrowers, without necessarily offering any juicer rates to savers.This is particularly true for large banks now. They’ve been flooded with savings as a result of government financial aid and reduced spending by many wealthier Americans during the pandemic. They won’t need to raise savings rates to attract more deposits or CD buyers.But online banks and others with high-yield savings accounts could be an exception. These accounts are known for aggressively competing for depositors. The only catch is that they typically require significant deposits.Cryptocurrencies like bitcoin could become a little less attractive to many investors.While bitcoin prices were mostly unchanged after the Fed’s announcement, crypto prices had declined in the days leading up to the central bank’s move. They dropped by a third in seven days.Higher interest rates mean that safe assets like bonds and Treasuries become more attractive to investors because their yields are now higher. That, in turn, makes risky assets like technology stocks and cryptocurrencies less attractive.All that said, bitcoin is suffering from its own problems that are separate from economic policy. Two major crypto firms have failed in the span of a month. The shaken confidence of crypto investors is not being helped by the fact the safest place you can park money now — bonds — seems like a safer move.Right now, payments on federal student loans are paused until August 31 as part of an emergency measure put into place during the pandemic. Inflation means loan-holders have less disposable income to make payments, but a slowed economy that reduces inflation could bring some relief by fall.The government may choose to extend the emergency measure deferring payments at the end of summer, depending on the state of the economy. President Joe Biden is also considering some form of loan forgiveness. For those taking out new private student loans, prepare to pay more. Rates vary by lender, but are expected to increase.Associated Press journalists Ken Sweet, Adriana Morga and Cora Lewis contributed to this report. Morga and Lewis cover financial literacy for The Associated Press. The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism. | Interest Rates |
SYDNEY: China has released Australian journalist Cheng Lei after more than three years, Prime Minister Anthony Albanese announced on Wednesday (Oct 11), adding that she was freed from detention and reunited with her two young children in Melbourne.
"The Australian people very much wanted to see Cheng Lei reunited with her young kids," Albanese said.
Cheng, a former presenter for Chinese state broadcaster CGTN, had been detained since August 2020.
She was only formally arrested months later and eventually charged with "supplying state secrets overseas" in a case that many saw as politically motivated.
The mother of two had been a familiar face on the state broadcaster's English-language channel, conducting interviews with noted CEOs from around the world.
Born in Hunan province, Cheng is now an Australian national who emigrated to the country as a child, before returning to China and joining the state broadcaster in 2012.
China does not allow citizens to hold dual nationality.
She was tried behind closed doors, with even Australia's ambassador to China blocked from entering the court to observe proceedings.
Australia's government had long campaigned for her release, and for China to follow "basic standards of justice, procedural fairness and humane treatment".
"I MISS THE SUN"
Cheng had written about bleak prison conditions in a candid note dictated to Australian officials from jail and released in August.
"I miss the sun," read the message, described as a "love letter" to Australia. "In my cell, the sunlight shines through the window but I can stand in it for only 10 hours a year."
Albanese said she had been released after the "completion of legal processes in China".
Cheng's case had been a serious point of friction between Canberra and Beijing.
China has repeatedly detained foreign nationals at times of high political tension with their home nations, raising accusations of hostage diplomacy.
Cheng's case has often been compared with that of Chinese-born Australian writer Yang Jun, who has been detained in China since 2019 on vaguely defined espionage charges.
Albanese said that Cheng's release would facilitate his visit to China at a "mutually agreed time" this year.
Australia-China relations had been in deep freeze after Canberra barred Chinese tech firm Huawei from lucrative contracts and pushed back against Chinese influence campaigns in Australia.
China was also furious at Canberra's calls for an investigation into the origins of the COVID-19 outbreak that killed millions and plunged the world's economy into a multi-year crisis.
In retaliation, China introduced a swathe of de facto sanctions against Australian products, measures that have been slowly unwound as relations thaw. | Australia Business & Economics |
LONDON – A close associate of Andrew Tate put a “bounty” on the head of influencer KSI, offering a prize to the Tate follower who made the most popular video about how the streamer and boxer “needs to be condemned and cancelled,” according to chat logs and other evidence obtained by VICE World News.
Experts have pointed to manipulation of tech platform’s algorithms as a central feature of Tate’s rise to fame over the past several years. Another aspect of the Tate empire’s online presence, though, is the way his followers swarm his perceived enemies – something that appears to have been in at least some cases centrally directed by Tate’s inner circle.
The mechanism, in this case, was Tate’s Hustlers University, “an online money-focused community providing education and coaching to over 100,000 students worldwide,” according to its website. In practice, the programme, aimed at boys and young men (“shock your friends and family by becoming the kid who’s leveling up in real life,” reads the website), resembled multi-level marketing, with members who paid $49 per month to receive instruction on how to “make money online” learning how to participate in an affiliate-link scheme that involved sharing viral clips of Tate.
A source who was once a member of Hustlers University says students were also offered “cancellation bounties,” which were placed on the heads of Tate’s perceived enemies. In a message this source shared with VICE World News, a moderator using the screen name “Luc” appears to be instructing members to make videos condemning KSI – a British YouTuber, boxer, rapper and entrepreneur with 24 million followers – and offering a reward for the most successful one.
This message was sent on the 23rd of August 2022, two days after KSI tweeted “thank God Andrew Tate was banned” when Tate was banned from social media platforms including Instagram, Youtube, and TikTok.
Two days later, “Luc” posted the “cancellation bounty” to a Hustlers University Discord server.
VICE World News visited Tate’s compound in Romania in August 2022, and while there filmed both Andrew and his cousin, Luke, seemingly replying to messages on Hustlers University Discord servers.
Luke, aware that VICE World News was filming, moved between various Telegram groups and Discord servers, advising students on what Tate content to post and seemingly trying to quell fears that Youtube would ban their accounts. On Discord, he did so using the handle “Luc.”
Luke did not respond to repeated requests for comment at the phone number he provided us with when VICE World News filmed with him in August 2022. Emails sent to his listed email address bounced back.
The bounty was just one prong of Tate’s campaign. In a video posted on the 27th of August to Rumble, a platform backed by tech oligarch Peter Thiel and US senator JD Vance that promotes itself as “immune to cancel culture,” Tate publicly ranted against KSI himself. Tate begins by showing a number of clips from old KSI videos in which, among other things, he makes what he called a “rape face.”
“This is a personal message to you, KSI,” Tate goes on to say. “I had no problem with you, I don’t fucking know you, I don’t watch your bullshit YouTube channel but when I get banned, you want to go from a fan to just instantly cowering out to the matrix? That makes you a hypocrite,” he said. “There's nothing more disgusting than a male hypocrite. At least Jake Paul was man enough to say, “Stand up for free speech.” If you ever fought Jake, he would smash your fucking face in. And if you want to get smoked twice, I’ll fucking smoke you myself!”
If you have information to share with us that pertains to this story, we’d like to hear from you. You can send an email to [email protected], or contact us via Twitter at @Matt_A_Shea or @JamieTahsin. Alternatively, you can create a Proton Mail account, which stores and transmits messages in an encrypted format, and email us at [email protected].
KSI had previously beaten Jake Paul’s brother Logan in a boxing match; Tate himself is a former champion kickboxer.
“You’re full of shit, you’re a fucking hypocrite,” Tate continued. “The shit you've said in the past is worse than anything I've ever fucking said and you know it. I will take you 12 rounds and I will break every bone in your fucking face. Fucking dork. Fuck KSI.”
Hustlers University ostensibly taught members how to create wealth on the internet. Paying for the course would get you access to Discord servers chaired by Tate’s “professors,” who taught classes on crypto trading, copywriting, dropshipping, forex trading, and various other ways to make money online.
One of the supposed methods of “wealth creation” taught to students was an affiliate marketing programme for the course itself. An affiliate marketing program involves people sharing links to products or courses; if someone signs up through a link posted by a given person, they get a cut of the fee paid for the course.
There’s nothing nefarious about affiliate marketing in general. What was perhaps unique about Tate’s affiliate program, aside from the way it turned boys and young men seeking to learn how to get rich into foot soldiers in his digital army, is that the links being shared were for the same Hustlers University course, meaning that new sign-ups were taught how to create their own affiliate links for the course, and so on. It is this that has led some to liken the programme to a multi-level marketing scheme
To promote their affiliate links for the course, Hustlers University members were instructed to share clips of Tate, with their affiliate links posted in the video and page descriptions. This explains, in part, how Tate became so famous so quickly – he had financially incentivised tens of thousands of people to share clips of him on social media. In particular, it has been argued that the more controversial the clip, the more likely it is to go viral; all of this does a lot to explain why videos of Tate making his most controversial claims are shared so widely across the internet.
This has been described as a “blatant attempt to manipulate the algorithm.” It’s also what’s allowed Tate to tactically avoid social media bans, as the videos aren’t being posted from Tate’s account, but thousands of others, apparently coordinated via Telegram groups and Discord servers.
The KSI case isn’t the only instance of seemingly coordinated attempts to spread content and messaging about Tate and his apparent detractors. The Center for Countering Digital Hate announced on Wednesday the 14th of January that it had found 4,621 fake Twitter accounts that had been created to promote Tate. The bot accounts tweeted 15,202 times in support of the former kickboxer, mass tweeting using hashtags "#freetopG," "#freetate," "#freeandrewtate," or "#freetates". The accounts were deemed as fake if they had less than 10 followers, and were less than 3 months old.
“If Elon Musk is serious about dealing with fake accounts, bots, and inauthentic behaviour then Twitter must act on Andrew Tate’s network of fake accounts manipulating Twitter’s algorithm,” Imran Ahmed, the CEO of CCDH, said in a press release.
Musk previously claimed that one of his biggest priorities after acquiring Twitter was to "defeat the spam bots or die trying." | Forex Trading & Speculation |
SINGAPORE, Nov 3 (Reuters) - The U.S. dollar eased slightly on Thursday as investors digested the possibility that Federal Reserve may raise interest rates further than expected, while sterling edged higher ahead of the Bank of England policy meeting.The Fed on Wednesday raised its benchmark funds rate by 75 basis points (bps) to 3.75-4% as widely expected. The dollar initially fell on hints in the Fed's statement of smaller hikes ahead, but regained strength after Chair Jerome Powell said that the battle against inflation will require borrowing costs to rise further."Incoming data since our last meeting suggests that the ultimate level of interest rates will be higher than previously expected," Powell told reporters, adding: "It is very premature to be thinking about pausing... we have a ways to go."The hawkish stance from Powell dashed hopes of a pivot to a less aggressive stance and saw the dollar hit a week-high of $0.9810 per euro in early Asia trade. But the greenback lost some steam through the day and was last trading at $0.983."We are seeing a slight pullback in dollar after the big moves yesterday," Alvin Tan, head of Asia FX strategy, RBC Capital Markets, pointing out that market activity was muted as a result of a public holiday in Japan.Tan said for the Fed bringing down inflation is more important than supporting economic growth and the central bank will keep on tightening."They are going to reduce the pace but keep on tightening," he added, noting that this was not something new but pushes back the growing narrative of a Fed pivot because of slowdown in growth.The U.S. dollar index fell 0.214% at 111.880, coming off a session high of 112.19, its highest in seven sessions.The slight retreat in dollar is unlikely to last long."Strong hawkish messaging from the Fed chair pours cold water on premature dovish pivot expectations," said analysts at Citi, who recommend staying long the U.S. dollar in Asia."This shall further embolden expectations of policy divergence with a much hawkish Fed relative to other central banks around the world. Further tightening of financial conditions shall put downward pressure on risk assets and strengthen the dollar."Meanwhile, the pound was last trading at $1.1412, up 0.20% on the day ahead of the Bank of England meeting, when the central bank is on track to raise interest rates by three quarters of a percentage point to 3%, its biggest rate rise since 1989."The risk is that the BoE maintains the current pace of tightening and delivers a 50 bps hike," said Commonwealth Bank of Australia analyst Kim Mundy. "A 50 bps hike would be considered 'dovish' by market participants and can push sterling lower."Japan's yen remained notably firm and has held at 147.24 per dollar as traders continue to watch for any more official interventions for the battered currency.Japan spent a record $42.8 billion propping up the yen last month via a series of unannounced yen purchases, on top of almost $20 billion spent in September.========================================================Currency bid prices at 0442 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJReporting by Tom Westbrook and Ankur Banerjee; Editing by Shri Navaratnam and Kim CoghillOur Standards: The Thomson Reuters Trust Principles. | Forex Trading & Speculation |
A woman holds Euro banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryEuro just off its two decade lowRising risk appetite support the single currencySwiss Franc hovering around 7-year high vs euroAussie dollar up on commodity prices reboundGraphic: World FX ratesJuly 7 (Reuters) - A pullback in the dollar offered the euro some respite, allowing it to edge away from two-decade lows reached this week after surging energy prices fanned recession fears.Risky assets, including the euro, managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes. read more European Central Bank minutes about its June policy meeting failed to affect the forex market.Register now for FREE unlimited access to Reuters.comMeanwhile, implied volatility remained near its highest levels since late March 2020 at 11.2% , reflecting a nervous market while investors look at the parity between the single currency and the dollar."Parity is within reach, and one can expect the market to want to see it now," said Moritz Paysen currency and rates advisor at Berenberg.The euro rose 0.1% to 1.0194 after hitting a two-decade low at 1.01615 on Wednesday.According to George Saravelos, global head of forex research at Deutsche Bank, "if Europe and the U.S. slip-slide into a recession in Q3 while the Fed is still hiking rates, these levels (0.95-0.97 in EUR/USD) could well be reached.""The two key catalysts to mark a turn in the USD embedded in our forecasts are a signal that the Fed is entering a protracted pause in its tightening cycle and/or a clear peak in European energy tensions via an end to Ukraine hostilities," he said.The dollar index - which measures the value of the currency against six counterparts - slipped 0.2% to 106.86, pulling away from Wednesday's peak of 107.27, a level not seen since late 2002.Commodity-linked currencies strengthened as copper prices climbed. Some investors returned to the market on Thursday after heightened recession fears sent the red metal to its lowest level in nearly 20 months.A Bloomberg News story, citing unnamed sources, said China mulled $220 billion stimulus with unprecedented bond sale."We saw a pretty muted reaction to the headline about China's stimulus plan, even for offshore yuan," said Roberto Mialich, forex strategist at Unicredit."We remain cautious about growth in China while we see commodity-linked currencies recovering today along with commodity prices," he added.The offshore Chinese yuan was up 0.1% against the dollar to 6.705.The Australian dollar rose 0.8% to 0.6841 against the U.S. dollar after recently hitting its lowest since June 2020 at 0.6762.The Swiss Franc eased from its seven-year high, down 0.2% at 0.9909.Earlier this week, inflation staying above the Swiss National Bank's (SNB) 0-2% target range for the fifth month fuelled talk that the central bank could soon tighten its policy again. Last month it hiked its policy rate for the first time in 15 years.The SNB has signalled it is prepared to see the Swiss franc strengthen to choke off imported inflation.Sterling was unchanged after British Prime Minister Boris Johnson said he would resign. read more It was up 0.5% at $1.1977.Analysts said the pound was mostly moving on broader economic concerns about a global recession, rather than Britain's political turmoil.Bitcoin fell 0.7% and was last trading at $20,402. Ether fell 0.8% to 1,176.Register now for FREE unlimited access to Reuters.comReporting by Stefano Rebaudo; Editing by Angus MacSwan and Tomasz JanowskiOur Standards: The Thomson Reuters Trust Principles. | Forex Trading & Speculation |
A general view shows the building of the Swiss National Bank (SNB) in Zurich, Switzerland June 23, 2022. Picture taken with a drone. REUTERS/Arnd Wiegmann/File PhotoRegister now for FREE unlimited access to Reuters.comZURICH, Aug 27 (Reuters) - The Swiss National Bank (SNB) sees no need to adjust its definition of price stability from its current target of "a rise in consumer prices of less than 2% per year", Chairman Thomas Jordan in a speech he is due to deliver in Jackson, Wyoming.Raising the inflation target would lead to an increase in expected and realised inflation, reducing the need to resort to unconventional monetary policy tools such as forex market interventions, Jordan says in the speech, a copy of which was released to reporters on Saturday.He joins other central bank officials at the Jackson Hole conference hosted by the U.S. Federal Reserve.Register now for FREE unlimited access to Reuters.comBut he said a significantly higher inflation target would not be compatible with ensuring price stability."Higher rates of inflation would be neither understood nor accepted in Switzerland," he said.He also dismissed targeting an average inflation rate over a given period, saying the Swiss economy had proven it could deal well with temporary inflation shocks, and compensating for past deviations from a targeted average would massively increase volatility in prices and output.A third possible adjustment - choosing a point target rather than a range - would complicate the implementation of the SNB's monetary policy. Targeting a range gave the central bank some flexibility as it could let inflation persist at the upper or lower end of the range for some time without losing credibility, Jordan said."In particular, this allows us to better absorb different global inflation regimes," he said, adding that in recent years the SNB would have had to take significantly stronger monetary policy easing measures if it had wanted to meet a 2% point target for inflation.The European Central Bank set a new inflation target of 2% last year and said it would consider climate change criteria for its asset purchases.Realism and flexibility in the inflation target do not mean compromising on price stability, Jordan said. "We have repeatedly proved that we are prepared to act decisively if price stability is at threat," he said.The SNB raised rates by 50 basis points in June. read more Jordan also rejected the idea of broadening the SNB's mandate to include climate protection or wealth redistribution, saying these were ultimately political goals the SNB did not have the instruments to address.Register now for FREE unlimited access to Reuters.comReporting by Silke Koltrowitz; Editing by Emelia Sithole-MatariseOur Standards: The Thomson Reuters Trust Principles. | Inflation |
A woman holds Euro banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryEuro just off its two decade lowRising risk appetite support the single currencySwiss Franc hovering around 7-year high vs euroAussie dollar up on commodity prices reboundGraphic: World FX ratesJuly 7 (Reuters) - The euro edged higher on Thursday, supported by rising risk appetite but still within striking distance of its two-decade low as surging energy prices fuel recession fears.Meanwhile, implied volatility in the forex market was still at its highest levels since late March 2020 at 11.2% , reflecting a nervous market while investors look at the parity between the single currency and the dollar.Equities managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes. read more Register now for FREE unlimited access to Reuters.com"Parity (between the euro and the dollar) is within reach, and one can expect the market to want to see it now," said Moritz Paysen forex and rates advisor at Berenberg.The euro rose 0.1% to 1.019 after hitting a two-decade low at 1.01615 on Wednesday.According to George Saravelos, global head of forex research at Deutsche Bank, "if Europe and the U.S. slip-slide into a recession in Q3 while the Fed is still hiking rates, these levels (0.95-0.97 in EUR/USD) could well be reached.""The two key catalysts to mark a turn in the USD embedded in our forecasts are a signal that the Fed is entering a protracted pause in its tightening cycle and/or a clear peak in European energy tensions via an end to Ukraine hostilities," he said.The dollar index -- which measures the currency against six counterparts -- slipped 0.1% to 106.97, pulling away from Wednesday's peak of 107.27, a level not seen since late 2002.Commodity-linked currencies strengthened as copper prices climbed. Some investors returned to the market on Thursday after heightened recession fears sent the red metal to its lowest level in nearly 20 months.The Australian dollar rose 0.6% to 0.6821 against the U.S. dollar after recently hitting its lowest since May 2020 at 0.6762.The Swiss Franc was still hovering around its highest since 2015 against the euro at 0.9872.Earlier this week, inflation rising above the Swiss National Bank's (SNB) 0-2% target range for the fifth month fuelled talks that the central bank could soon tighten its policy. Last month it hiked its policy rate for the first time in 15 years.The SNB has signalled it is prepared to see the Swiss franc strengthen to choke off imported inflation.Britain's pound rose versus a weakening dollar on Thursday after hitting a more than two-year the day before as Prime Minister Boris Johnson clung to power despite the resignation of key cabinet members.Sterling was up 0.3% to 1.1935, while being flat against the single currency at 85.48 pence.Analysts said that the pound was mostly moving on broader economic concerns about a global recession, rather than Britain's political turmoil. read more Bitcoin rose 0.2% and was last trading at $20,413. Ether fell 0.9% to 1,174.Register now for FREE unlimited access to Reuters.comReporting by Stefano Rebaudo; Editing by Kim CoghillOur Standards: The Thomson Reuters Trust Principles. | Forex Trading & Speculation |
A woman holds Euro banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryEuro just off its two decade lowRising risk appetite support the single currencySwiss Franc hovering around 7-year high vs euroAussie dollar up on commodity prices reboundGraphic: World FX ratesJuly 7 (Reuters) - A slight pullback in the dollar offered the euro some respite, allowing it to edge away from two-decade lows reached this week after surging energy prices fanned recession fears.Risky assets, including the euro, managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes. read more Meanwhile, implied volatility in the forex market was still at its highest levels since late March 2020 at 11.2% , reflecting a nervous market while investors look at the parity between the single currency and the dollar.Register now for FREE unlimited access to Reuters.com"Parity is within reach, and one can expect the market to want to see it now," said Moritz Paysen forex and rates advisor at Berenberg.The euro rose 0.2% to 1.02 after hitting a two-decade low at 1.01615 on Wednesday.According to George Saravelos, global head of forex research at Deutsche Bank, "if Europe and the U.S. slip-slide into a recession in Q3 while the Fed is still hiking rates, these levels (0.95-0.97 in EUR/USD) could well be reached.""The two key catalysts to mark a turn in the USD embedded in our forecasts are a signal that the Fed is entering a protracted pause in its tightening cycle and/or a clear peak in European energy tensions via an end to Ukraine hostilities," he said.The dollar index -- which measures the currency against six counterparts -- slipped 0.2% to 106.88, pulling away from Wednesday's peak of 107.27, a level not seen since late 2002.Commodity-linked currencies strengthened as copper prices climbed. Some investors returned to the market on Thursday after heightened recession fears sent the red metal to its lowest level in nearly 20 months.The Australian dollar rose 0.7% to 0.6822 against the U.S. dollar after recently hitting its lowest since May 2020 at 0.6762.The Swiss Franc was still hovering right above its highest since 2015 against the euro at 0.9872.Earlier this week, inflation rising above the Swiss National Bank's (SNB) 0-2% target range for the fifth month fuelled talks that the central bank could soon tighten its policy. Last month it hiked its policy rate for the first time in 15 years.The SNB has signalled it is prepared to see the Swiss franc strengthen to choke off imported inflation.Britain's pound rose versus a weakening dollar on Thursday after hitting a more than two-year the day before as Prime Minister Boris Johnson clung to power despite the resignation of key cabinet members.Sterling was up 0.5% to %1.1977, while rising 0.2% versus the euro at 85.21 pence.Analysts said that the pound was mostly moving on broader economic concerns about a global recession, rather than Britain's political turmoil. read more Bitcoin fell 0.7% and was last trading at $20,402. Ether fell 0.8% to 1,176.Register now for FREE unlimited access to Reuters.comReporting by Stefano Rebaudo; Editing by Kim Coghill and Angus MacSwanOur Standards: The Thomson Reuters Trust Principles. | Forex Trading & Speculation |
TAIPEI, Taiwan -- Australia and China opened their first high-level dialogue in three years Thursday in a sign of a slight thaw to relations between countries that have clashed on everything from human rights to COVID-19 origins to trade.
"I welcome the recent positive developments in the bilateral relationship, but we know that there is more work to do,” said Craig Emerson, the head of the Australian delegation and a former trade minister.
The dialogue being held in Beijing will focus on trade, people-to-people links and security.
China's former Foreign Minister Li Zhaoxing said the two countries should work together, but added that “We should adhere to the liberalization of trade and jointly oppose the Cold War mentality, bloc confrontation and trade protectionism.”
Beijing often uses those terms in opposing the actions of Western countries, particularly the U.S.
During the freeze in relations with Beijing, Australia formed a nuclear partnership with the U.S. and the United Kingdom that enables Australia to access nuclear-powered submarines.
Australia's current Foreign Minister Penny Wong has sought to stabilize the two countries' relationship since her party won elections last year.
On Thursday, Australia's Prime Minister Anthony Albanese also met with China's Premier Li Qiang at the sidelines of the Association of Southeast Asian Nations summit in Indonesia, describing the engagement as positive.
“I told Premier Li that we would continue to cooperate where we can, disagree where we must and engage in our national interest,” Albanese said to reporters, according to a statement from his office, saying he would visit China later this year at the invitation of China's leader Xi Jinping.
China's and Australia’s relations sank to low depths during the pandemic. The previous Australian government passed laws that ban covert foreign interference in domestic politics, barring Chinese-owned telecommunications giant Huawei from rolling out Australia’s 5G network due to security concerns, and for calling for an independent investigation of the COVID-19 pandemic.
In response, China effectively blocked out Australian barley in 2020 by imposing an 80.5% tariff, widely regarded in Australia as punishment. China also put tariffs on Australian wine, beef, and coal, as well as other products. China recently lifted the tariff against barley.
Australia is also hoping to see a breakthrough in the cases of five detained Australians in China, among which is Cheng Lei, a journalist who has been imprisoned for three years.
“We continue to advocate for positive progress on the cases of Australians detained in China,” Emerson said.
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Find more of AP’s Asia-Pacific coverage at https://apnews.com/hub/asia-pacific | Asia Business & Economics |
An employment application form is displayed during a restaurant job career fair organized by the industry group High Road Restaurants in New York City, U.S., May 13, 2021. REUTERS/Brendan McDermidRegister now for FREE unlimited access to Reuters.comNEW YORK, Aug 5 (Reuters) - U.S. job growth surged much more than expected in July and the unemployment rate ticked lower, giving the Federal Reserve enough cushion to stay on its aggressive rate hike path as it tries to tame inflation.Nonfarm payrolls increased by 528,000, the Labor Department's employment report showed on Friday. June was revised upward to show payrolls rising by 398,000 instead of the previously reported 372,000. Economists polled by Reuters had forecast 250,000 jobs added last month.Employers continued to raise wages at a steady pace last month. Average hourly earnings increased 0.5% in July after gaining 0.4% in June. That increased the year-on-year increase to 5.2% from 5.1% in June. read more Register now for FREE unlimited access to Reuters.comMARKET REACTION:STOCKS: S&P e-mini futures dropped sharply, last down 1.0%BONDS: The yield on 10-year Treasury notes shot higher and was up 11.2 basis points to 2.788%; The two-year U.S. Treasury yield, was up 16.6 basis points at 3.203%.FOREX: The dollar index jumped and was last up 0.946% at 106.680COMMENTS:SAM STOVALL, CHIEF INVESTMENT STRATEGIST AT CFRA RESEARCH, NEW YORK"Inflation is likely to remain sticky for longer. With that many more people working, there's that much more money that's going to be earned to chase after these goods to drive the inflation… but elevated inflation readings will likely remain with us for longer than anticipated. We can now hear Fed Chair Powell's voice echoing in our heads, saying that the stronger than expected jobs report implies that the economy can indeed withstand higher rates.""We were approaching the 50% retracement level on the S&P 500, which is important because no bear market since World War II ever reached the level, only to then establish an even lower low. We came close but did not hit that level. August's markets personality will come through once again as being the third highest month in terms of volatility and that sets up the market for a very cautious September as well.""While next week's numbers will imply that the peak is in, in terms of inflation, because we're looking for an 8.8% year on year rise versus the prior reading of 9.1%, initially, one could look at that as positive news, but now investors might say, it could simply be a dip before an even higher reading down the road."MICHAEL PEARCE, SENIOR US ECONOMIST, CAPITAL ECONOMICS, NEW YORK"The unexpected acceleration in non-farm payroll growth in July, together with the further decline in the unemployment rate and the renewed pick-up in wage pressure, make a mockery of claims that the economy is on the brink of recession. This raises the odds of another 75 basis point rate hike in September, although the outcome depends more on the evolution of the next couple of CPI reports."ART HOGAN, CHIEF MARKET STRATEGIST, B. RILEY, NEW YORK"Anyone that was inclined to jump onboard the pivot train is likely to jump off at the next station. This is not indicative of a Fed that will need to shift gears next year and start cutting (rates). The pivot narrative has been put to bed. But this doesn't preclude the Fed from downshifting to 50 bps in Sept.”"This is good news. Market may have a negative reaction in a knee-jerk fashion but we want people working and the labor participation rate to go higher. There are two ways of stay out of recession and one of those is for jobs to continue to grow and consumers to continue to spend.""As it pertains to the labor force, it's never felt like we were going into a recession. You could certainly see a recession sometime in 2023 but it's certainly not knocking on the door right now, not with these many jobs being created on a monthly basis. Last month's number was revised higher as well. It's a strong report and the rumors of a recession have certainly been exaggerated.""There is some time between the next Fed meeting. Anyone that extrapolates what the Fed is going to do based one data point between now and September is getting ahead of themselves."BRIAN JACOBSEN, SENIOR INVESTMENT STRATEGIST, ALLSPRING GLOBAL INVESTMENTS, MENOMONEE FALLS, WISCONSIN"The headline number is really impressive, but maybe that’s more style over substance. The number of multiple jobholders shot up more 559,000. Is some of the employment strength superficial and just because people are trying to work more in order to make ends meet?"PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK"Payrolls were nearly double the amount we were looking for. There's nothing to suggest this report this weak at all. Unemployment actually went down to 3.5%.""This is very hot employment data. It means the Fed is going to continue to raise interest rates. Bonds are getting crushed. Stocks are coming down.""The bottom line is this gives the upper hand to the Fed, which says we're not in a recession yet and the Fed will probably tighten. If we get one more number like this in August, the Fed could hike by 75 basis points in September rather than 50 basis points.""I'm surprised in the strength in wage growth, I was looking for a cooling off. That's the key to the report. That's why we’re seeing a sell off in the bond market and it proves that inflation is still a big problem."PAUL NOLTE, PORTFOLIO MANAGER AT KINGSVIEW ASSET MANAGEMENT, CHICAGO"What we've heard from the various Fed governors this week about it being too early to pivot away from a tightening policy is definitely in place with the jobs report that is THIS hot.""When you look back at the period from 2015 to 2019, the average jobless jobs gain was 190,000, and the unemployment rate was north of 4. We're well below that as far as the unemployment rate, and certainly we've been averaging 200,000 to 300,000 new jobs going forward, so the job market continues to be much hotter than historically normal times. So it gives the Fed reason to continue to raise rates. And that is what's got the market on edge.""The number's not a surprise. There were some hints at it from some of the Fed governors. The inflation numbers next week will complete that picture. The inflation rate will come down, my guess is we get down to maybe 5% or 6% by the end of the year. But the hard part is going to be getting from that 5%, 6% to 2%. That's going to require a more aggressive Fed. So the Fed is still on target to raise rates, 75 basis points makes sense in light of the data, and they will continue at each of their meetings through the end of the year."Register now for FREE unlimited access to Reuters.comCompliled by the global Finance & Markets Breaking News teamOur Standards: The Thomson Reuters Trust Principles. | Unemployment |
CANBERRA, Australia -- Australia’s prime minister said Tuesday he was confident that Indigenous Australians overwhelmingly support a proposal to create their own representative body to advise Parliament and have it enshrined in the constitution.
Prime Minister Anthony Albanese's remarks came as Tiwi Islanders cast their votes on making such a constitutional change. They were among the first in early polling that began this week in remote Outback communities, many with significant Indigenous populations.
The Oct. 14 referendum is to decide on having the so-called Indigenous Voice to Parliament enshrined in the constitution.
“I’m certainly confident that Indigenous Australians will overwhelming be voting ‘yes’ in this referendum,” Albanese told reporters in the city of Adelaide. He said his confidence was based on opinion polling and his interactions with Indigenous people in remote Outback locations.
He blamed disinformation and misinformation campaigns for polls showing that a majority of Australians oppose the Voice.
Some observers argue the referendum was doomed when the major conservative opposition parties decided to oppose the Voice. Opposition lawmakers argue it would divide the nation along racial lines and create legal uncertainty because the courts might interpret the Voice’s constitutional powers in unpredictable ways.
“What has occurred during this campaign is a lot of information being put out there — including by some who know that it is not true,” Albanese said.
No referendum has ever passed without bipartisan support of the major political parties in the constitution’s 122-year history.
Leading “no” campaigner Warren Mundine rejected polling commissioned by Voice-advocates that found more than 80% of Indigenous people supported the Voice. Mundine fears the Voice would be dominated by Indigenous representatives hand-picked by urban elites. He also shares many of the opposition parties' objections to the Voice.
“Many Aboriginals have never heard of the Voice, especially those in remote and regional Australia who are most in need,” Mundine, an Indigenous businessman and former political candidate for an opposition party, told the National Press Club.
Indigenous Australians account for only 3.8% of the Australia’s population so are not expected to have a major impact on the result of the vote. They are also Australia’s most disadvantaged ethnic minority.
Voice proponents hope to give them more say on government policies that effect their lives.
In the three weeks until Oct. 14, Australian Electoral Commission teams will crisscross the country collecting votes at 750 remote outposts, some with as few as 20 voters,
The first was the Indigenous desert community of Lajamanu, population 600, in the Northern Territory on Monday.
Australian Electoral Commissioner Tom Roger on Tuesday visited Indigenous communities on the Tiwi Islands off the Northern Territory's coast. The islands have a population of around 2,700.
Thousands of votes were expected to be collected Monday and Tuesday from 64 locations across the Northern Territory and the neighboring states of Western Australia and Queensland.
Andrea Carson, a La Trobe University political scientist who is part of a team monitoring the referendum debate, said both sides were spreading misinformation and disinformation. Her team found through averaging of published polls that the “no” case led the “yes” case 58% to 42% nationally — and that the gap continues to widen.
This is despite the “yes” campaign spending more on online advertising in recent months than the “no” campaign. The “no” campaign's ads targeted two states regarded as most likely to vote “yes,” South Australia, where Albanese visited on Tuesday, and Tasmania.
For a “yes” or “no” vote to win in the referendum, it needs what is known as a double majority — a simple majority of votes across the nation and also a majority of votes in a majority of states. A majority of Australian states is four out of six. | Australia Business & Economics |
Woman holds British Pound banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryProfit taking pushes dollar from 20-year peakSterling up almost 5% off Monday's lowTraders eye BoE economist talk at 1100 GMTSYDNEY/LONDON, Sept 27 (Reuters) - The dollar on Tuesday took a pause in what has been a relentless climb higher as the euro and even the besieged Japanese yen and British pound managed to recover a little ground, but medium-term fundamentals were still in the greenback's favour.The euro rose 0.42% to $0.9647, sterling climbed nearly 1% to $1.0783, and the dollar slid 0.33% against the yen to 144.25.These moves were minor however compared to the multi-year lows at which all three currencies are languishing. The euro was still near its 20-year trough hit the day before, and the yen was just off its 24-year nadir hit last week before Japanese authorities intervened to strengthen the currency.Register now for FREE unlimited access to Reuters.comSterling was not too far from its record low against the dollar of $1.0327 hit Monday, the end of a plunge that began Friday when markets were spooked by Britain's gambit of relying on unfunded tax cuts to spur growth, which also sent short-term gilt yields up 100 bps in two days."Everyone's got this hope that the dollar is peaking and peaking and peaking, but it's just been far too premature," said Paul Mackel, global head of FX research at HSBC."The Fed is firmly hawkish and global growth is weakening, and you put those forces together alongside higher elements of risk aversion - it's all pointing to a strong dollar if not a strengthening dollar."The dollar index was at 112.39 on Tuesday, down 0.7% on the day, with the decline in the safe haven broadly in line with a recovery in markets' sentiment towards riskier assets, which also boosted European stocks and U.S. share futures.The greenback's gains against the pound have been the most dramatic, and traders on Tuesday were waiting for the appearance by the Bank of England's chief economist, Huw Pill, at a panel event at 1100 GMT.The central bank, on Monday, said it would not hesitate to change interest rates and was monitoring markets "very closely", though did not take any more dramatic action. read more While sterling's climb Tuesday has seen it pare most of the previous day's losses, Qi Gao, currency strategist at Scotiabank in Singapore said it might be "short lived." The currency is still down 20% this year against the backdrop of a stronger dollar."More BoE rate hikes could only briefly boost the pound but not on a sustainable basis," said Gao.The Aussie and kiwi hit 2-1/2 year lows on Monday were also on the rebound with the Aussie up 0.57% to $0.6490 and the kiwi up 1.2% to $0.5702.China's yuan also hit a 2-1/2 year low on Monday and was broadly steady at 7.1538 on Tuesday.========================================================Currency bid prices at 0754 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook; Editing by Sam HolmesOur Standards: The Thomson Reuters Trust Principles. | Forex Trading & Speculation |
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