TWTR - Twitter, Inc.
30.40 +0.10 (0.33%)
Pre-market: 6:58AM EST
| Previous close | 30.55 |
| Open | 30.47 |
| Bid | 30.43 x 3200 |
| Ask | 30.46 x 4000 |
| Day's range | 29.93 - 30.59 |
| 52-week range | 26.26 - 45.86 |
| Volume | 18,689,091 |
| Avg. volume | 14,906,142 |
| Market cap | 24B |
| Beta (5Y Monthly) | 0.56 |
| PE ratio (TTM) | 14.77 |
| EPS (TTM) | 2.05 |
| Earnings date | 6 Feb 2020 |
| Forward dividend & yield | N/A (N/A) |
| Ex-dividend date | N/A |
| 1y target est | 34.33 |
- TechCrunch
Twitter is bringing back Election Labels to identify 2020 US election candidates
With just less than a year until U.S. Election Day, Twitter is bringing back its Election Labels, which provide information about political candidates -- including which office they're running for and their state and district number. The feature was first launched during the 2018 U.S. midterms, where the labels were seen 100 million times per day by Twitter users in the week before Election Day. In addition, 13% of U.S. election-related conversations on Twitter included a tweet with an Election Label, the company says.
- Bloomberg
Trump Signs Off on China Trade Deal to Avert December Tariffs
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. President Donald Trump signed off on a phase-one trade deal with China, averting the Dec. 15 introduction of a new wave of U.S. tariffs on about $160 billion of consumer goods from the Asian nation, according to people familiar with the matter.The deal presented to Trump by trade advisers Thursday included a promise by the Chinese to buy more U.S. agricultural goods, according to the people. Officials also discussed possible reductions of existing duties on Chinese products, they said. The terms have been agreed but the legal text has not yet been finalized, the people said. A White House spokesperson declined to comment.While there was no official confirmation from the government in Beijing on Friday, an announcement is expected in Washington as early as today, according to people familiar with the Americans’ plans. One possible option is for U.S. Trade Representative Robert Lighthizer to sign the agreement with Chinese Ambassador Cui Tiankai, according to people briefed on the matter.Global stocks hit a record high for the first time since early 2018 and bond yields climbed on optimism over trade. On Thursday, Trump tweeted that the U.S. and China are “VERY close” to signing a “BIG” trade deal, also sending equities higher. The yuan surged the most in a year, rising above 7 per dollar.“They want it, and so do we!” he tweeted five minutes after equity markets opened in New York, sending stocks to new records.The administration has reached out to allies on Capitol Hill and in the business community to issue statements of support once the announcement is made, people said. Before meeting his trade advisers, Trump engaged with members of the Business Roundtable, which represents some of the largest U.S. companies, they said.Trump changed his mind on deals with China before. Negotiators have been working on the terms of the phase-one deal for months after the president announced in October that the two nations had reached an agreement that could be put on paper within weeks.The U.S. has added a 25% duty on about $250 billion of Chinese products and a 15% levy on another $110 billion of its imports over the course of a roughly 20-month trade war. Discussions now are focused on reducing those rates by as much as half, as part of the interim agreement Trump announced almost nine weeks ago.In addition to a significant increase in Chinese agricultural purchases in exchange for tariff relief, officials have also said a phase-one pact would include Chinese commitments to do more to stop intellectual-property theft and an agreement by both sides not to manipulate their currencies.Put off for later discussions are knotty issues such as longstanding U.S. complaints over the vast web of subsidies ranging from cheap electricity to low-cost loans that China has used to build its industrial might.The new duties, which were scheduled to take effect at 12:01 a.m. Washington time on Sunday unless the administration says otherwise, would hit consumer goods from China including smartphones and toys.Even amid the positive signs on trade, Chinese foreign minister Wang Yi highlighted the other confrontations between the two sides. On Friday in Beijing, Wang said that U.S. actions had “severely damaged the hard-earned basis for mutual trust” and left the relationship in their “most complex” state since the two sides established ties four decades ago.Before today, Trump’s advisers had sent conflicting signals and stressed that he hadn’t made up his mind on the next steps.The decisions facing Trump over a trade deal highlight one dilemma he confronts going into the 2020 election: Whether to bet on an escalation of hostilities with China and the tariffs he is so fond of or to follow the advice of more market-oriented advisers and business leaders who argue a pause in the escalation would help a slowing U.S. economy bounce back in an election year.What Bloomberg’s Economists Say...“The outcome of U.S.-China trade talks will be a key determinant of the trajectory for 2020 growth. At one extreme, a deal that takes tariffs back to May 2019 levels, and provides certainty that the truce will hold, could deliver a 0.6% boost to global GDP. At the other, a breakdown in talks would mean the trade drag extends into the year ahead.”--Tom Orlik, chief economistFor the full report, click hereThe president’s expected announcement on Thursday was met with immediate criticism from Democrats and even by members of his own party. Republican Senator Marco Rubio, one of the most vocal China hawks in Congress, said the White House should consider the risks of a deal.A near-term pact “would give away the tariff leverage needed for a broader agreement on the issues that matter the most such as subsidies to domestic firms, forced tech transfers & blocking U.S. firms access to key sectors,” he said in a tweet.Democratic lawmakers in a letter on Thursday told the president this point in the negotiations marks a “critical juncture” for the U.S. to secure concessions “on major structural challenges that will only become more difficult to address.”“Your administration must stay strong against the Chinese government if fundamental concessions are not made. Anything short of a meaningful, enforceable and lasting agreement would be severe and unacceptable for the American people,” Senators Chuck Schumer, Ron Wyden and Sherrod Brown said.(Updates with markets in fourth paragraph, Chinese foreign minister lower.)\--With assistance from Justin Sink, Vince Golle and Josh Wingrove.To contact the reporters on this story: Jenny Leonard in Washington at jleonard67@bloomberg.net;Jennifer Jacobs in Washington at jjacobs68@bloomberg.net;Shawn Donnan in Washington at sdonnan@bloomberg.net;Saleha Mohsin in Washington at smohsin2@bloomberg.netTo contact the editors responsible for this story: Margaret Collins at mcollins45@bloomberg.net, Brendan Murray, Ana MonteiroFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Johnson Wins Crushing Majority in Election That Upends Britain
(Bloomberg) -- Sign up to our Brexit Bulletin, follow us @Brexit and subscribe to our podcast.Boris Johnson won an emphatic election victory that redraws the political map of Britain and gives the prime minister the mandate he needs to pull the U.K. out of the European Union next month.The result spectacularly vindicated Johnson’s gamble on a snap election to break the deadlock in Parliament over Brexit, as his Conservatives won their biggest majority since 1987 under Margaret Thatcher. The pound rose by the most in almost three years as the scale of the Tory victory became clear.Live Blog: U.K. General ElectionThe outcome was a repudiation of the main opposition Labour Party under Jeremy Corbyn and his radical program of state intervention, nationalization of industries and tax rises for the better off. Corbyn announced his intention to resign after a catastrophic run of losses to the Tories in Brexit-supporting districts in northern England and Wales. These areas were considered traditional Labour strongholds and Johnson’s success here was the breakthrough that secured his victory.Elsewhere, Liberal Democrat leader Jo Swinson, who campaigned to remain in the EU, lost her seat.Having routed political opposition to Brexit across much of the country, Johnson still faces resistance in Scotland, where support for the pro-independence Scottish National Party surged, setting up the prospect of a renewed constitutional standoff over the U.K.’s future.Northern Ireland may also present a thorn in Johnson’s side. Unionist parties lost their majority and nationalists made advances, suggesting that pressure for a referendum on Irish unity may grow.Johnson held a solid lead over Labour in polls before Thursday vote, but just how Brexit would play out in the U.K.’s third general election in four years was never certain. What emerged was the biggest shift in British political allegiances for decades as areas that had voted to quit the EU turned away from Labour and toward Johnson and his “Get Brexit Done” mantra.With all but one seat declared, the Conservatives had won 364 of the 650 seats in the House of Commons, a gain of 47, to Labour’s 203 seats, down 59. The results showed the Conservatives taking some districts from Corbyn’s party for the first time ever, compounding Labour’s fourth successive general election defeat.Leaders including Angela Merkel of Germany and U.S. President Donald Trump offered their congratulations. Trump, in a tweet, again raised the prospect of a “massive new trade deal” after the U.K. leaves the EU.Johnson’s majority gives him the power to get his own way on Brexit, especially if he needs extra time to negotiate with the EU. He has said he will start to push legislation through parliament before the end of the year to meet the current departure date of Jan. 31.Calling the result “historic,” Johnson hailed “a powerful new mandate to get Brexit done.”Investors responded to what they saw as a possible end to the political gridlock and uncertainty that has hung over British assets for years. The pound surged 1.7% to $1.3387 as of 11:15 a.m. in London. The benchmark FTSE 100 index of stocks jumped 1.9% despite being heavily skewed to exporters vulnerable to currency appreciation. The more domestically-focused FTSE 250 rallied 4.4% to the highest on record as trading volumes soared.For Labour, the heavy losses raise questions over its future direction after voters decisively rejected Corbyn and his program. Corbyn plans to remain in place until a successor is chosen but he’s facing pressure to stand aside immediately.“Tonight is an absolute disaster for the Labour Party,” Ian Murray, Labour lawmaker for Edinburgh South, told the BBC. “There has got to be a change of direction. That work either has to start tomorrow or the Labour Party has to reassess what it stands for.”Few people predicted the political earthquake that took place.In England and Wales, voters moved to the Conservatives almost everywhere, but particularly strongly in places that voted to leave the EU. Former industrial areas abandoned Labour for the first time in generations, with mining and steel towns that suffered from mass unemployment under the Conservatives in the 1980s now embracing the party.Scotland, which opposed Brexit in the 2016 referendum, staged a rebellion as the SNP retook seats it lost two years ago. It ended the night with 48 of 59 districts, halving the Tory seat tally, defeating the Liberal Democrat leader and reducing Labour to a solitary district. SNP leader Nicola Sturgeon reiterated her demand for another independence referendum, something Johnson has ruled out.“Boris Johnson has a mandate now to take England out of the EU,” Sturgeon said. “He must accept that I have a mandate to offer Scotland the choice of an alternative future.”For an interactive election map, click hereFor Johnson, his convincing majority marks the culmination of an extraordinary rise to power. After he led the pro-Brexit campaign three years ago, Johnson watched as Theresa May tried and repeatedly failed to negotiate an EU divorce agreement the House of Commons would accept. Once in power, Johnson secured a revised Brexit deal with the EU, but also couldn’t persuade Parliament to rush it into law.That prompted him to trigger an early election -- the next one wasn’t due until 2022 -- in the hope voters would give him the majority he needed. He now has a mandate “not just to get Brexit done,” he said, “but to unite this country and to take it forward and to focus on the priorities of the British people.”Addressing supporters in London on Friday morning, he said he had a “heavy responsibility” after winning support from former Labour heartlands. “We must rise to the challenge,” he said.\--With assistance from Heather Harris, Robert Hutton, Anna Edwards, Alastair Reed and Sam Potter.To contact the reporters on this story: Tim Ross in London at tross54@bloomberg.net;Alex Morales in London at amorales2@bloomberg.net;Greg Ritchie in London at gritchie10@bloomberg.netTo contact the editors responsible for this story: Flavia Krause-Jackson at fjackson@bloomberg.net, ;Rosalind Mathieson at rmathieson3@bloomberg.net, Alan CrawfordFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Trump’s China Deal Flirts With the Curse of a Phase One and Done
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. President Donald Trump is expected to formally present an interim deal with China as soon as Friday that will avoid further escalation of a trade war that for almost two years has hung over the world’s largest economies and thus almost any country or company doing business in them.But that agreement is already facing a question from political allies, foes, analysts and business groups alike that is likely to define the deal’s place in economic history: What if, after all those tariffs and all that drama, that’s it? What if it’s cursed to be Phase One and Done?Trump and his aides have promised that the partial deal the president first announced on Oct. 11 will be followed by others. That’s because while the initial accord may see China increase its agricultural purchases to as much as $50 billion annually and make commitments on currency and intellectual property enforcement, it includes nothing on more potent structural issues such as the vast web of subsidies that has fueled the global rise of many Chinese companies.While Trump has insisted that as many as two further phases will follow, many analysts are skeptical much more progress can be made going into an election year in the U.S. That could allow the Chinese to run out the clock.“After the ups and downs over the past two years that led to a partial deal, I’m not sure both countries have the stomach to get back into these issues with any urgency,” said Wendy Cutler, a veteran trade negotiator now at the Asia Society Policy Institute. “A phase one trade deal is a welcome step. But it looks like this deal will fall way short of the long-term fundamental changes in China’s trade regime that the administration laid out a couple of years ago.”That Trump appears ready to offer tariff relief in return has agitated China hawks in Washington who fear that after daring to take on Beijing in a way no prior president has with his tariffs, Trump is giving up leverage that might extract future concessions.Marco Rubio, who has staked his claim as the most vocal Republican China hawk in the Senate, on Thursday urged the White House in a tweet to not surrender tariff leverage. Beyond China’s subsidies for domestic firms, he said, those included its historical practice of forcing foreign companies to hand over technological know-how as a cost of market entry and the blocks facing U.S. firms wanting to do business in some sectors in China.All of those concerns remain priorities for a U.S. business community that has lobbied heavily against the Trump administration’s tariffs and questioned the efficacy of its tactics, even as it has endorsed its diagnosis of the problems that need to be addressed in China.In reactions sent out by business groups after Bloomberg and then others reported that Trump had signed off on the deal during a meeting with aides Thursday, the common theme was that there had to be more to come.“While this would be an important step, more work would remain to fully address longstanding concerns regarding China’s unfair trade policies and practices,” Jason Oxman, president and CEO of the Information Technology Industry Council, said in a statement.The U.S. has been engaged with the European Union and Japan in drafting potential rules to tackle industrial subsidies. Those talks have stalled, however, in part because of a lack of interest from the Trump administration, making some skeptical the new rules will ever amount to anything.Adding to the mistrust among historical allies like the EU is the U.S. administration’s move to hobble the World Trade Organization’s dispute resolution process by blocking the appointment of new judges to its appellate body. Around the world many other countries remain concerned by what they see as Trump’s efforts to dismantle a multilateral system the U.S. spent decades building.Trump’s aides have characterized the moves at the WTO as part of an effort to modernize a moribund institution that has failed to address what they see as China’s systematic cheating of the system since it joined the WTO in 2001. And there are signs some American business leaders are willing to play along with that as well as Trump’s broader trade disruptions.Jamie Dimon, the chief executive officer of JPMorgan Chase & Co. and outgoing chairman of the Business Roundtable, which represents U.S. CEOs, expressed doubts this week that a deal with China would go beyond an initial phase one agreement. But he told reporters in Washington that Trump was right to take on China.Moreover, after the administration delivered an update of Nafta in the form of the U.S.-Mexico-Canada Agreement now headed for approval in Congress, notched a partial deal with Japan and freshened up an existing pact with South Korea, many in business were willing to give Trump the benefit of the doubt on trade, he said.“If we accomplish those things it’s going to be important for the global economy for decades to come,” Dimon said.Then again, he also warned it was unclear whether Trump would succeed in remaking America’s trade relationships with China and others for the better. “We don’t know yet because it’s not done yet,” Dimon said. “We’ll know in five years.”To contact the reporter on this story: Shawn Donnan in Washington at sdonnan@bloomberg.netTo contact the editors responsible for this story: Simon Kennedy at skennedy4@bloomberg.net, Brendan Murray, Jeffrey BlackFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Gundlach’s $150 Billion Decade May Be His Industry’s Last Hurrah
(Bloomberg) -- It was one of the ugliest breakups the money-management business had ever seen -- a tabloid tale of ego and betrayal.But a decade after the star investor known to his staff as “the Godfather” stunned Wall Street with his bitter split from TCW Group and creation of a rival firm, the verdict is in:Jeffrey Gundlach won, and won big.His DoubleLine Capital, which turns 10 this month, today sits atop roughly $150 billion. In a business increasingly dominated by inexpensive index funds, the young juggernaut succeeded by actually picking good investments. Along the way, its flagship bond fund beat its benchmark in every year but one.DoubleLine’s first decade was so good that it’s not unreasonable to ask: can Gundlach possibly top this, and can anyone match it? At 60, he is a rare breed in mutual funds: a successful, 21st-Century founder. Many mutual fund managers have faded from public view, but markets hang on Gundlach’s pronouncements with a fervor these days usually reserved for hedge fund titans.“There aren’t that many famous managers today,” said Howard Marks, the billionaire co-founder of Oaktree Capital Management, whose firm paid $20 million for a 20% stake in DoubleLine when it started. “That probably argues against somebody else having as effective a startup.”Turmoil at bond giant Pacific Investment Management Co. following the 2014 ouster of Bill Gross helped DoubleLine succeed. As has Gundlach’s fame. He was already a star when he and more than 40 colleagues departed TCW to start the new firm, a move that led to a bitter dispute and a trial that was finally settled out of court. TCW’s assets over the past decade nearly doubled to $211 billion, including $30 billion from the purchase of MetWest.For Los Angeles-based DoubleLine, it’s been mostly about performance: the firm’s Total Return Bond fund is up 5.9% a year on average since its 2010 launch, outpacing its benchmark’s 3.8% annualized gain. Its latest darling, the DoubleLine Shiller Enhanced CAPE fund, has risen 15% a year since it opened in late 2013, beating the S&P 500 Index’s 12% increase.Gundlach’s investing relies on choosing securities and limiting risks such as interest rate fluctuations and other volatility. His outlook is shaped by a deep team of portfolio managers who have worked together for an average of 16 years. In an industry known for high turnover, DoubleLine has remained stable, with only one major defection.“Having a name and face as prominent and successful as Jeffrey Gundlach has added value and helps the firm continue to gather assets,” said Todd Rosenbluth of CFRA Research. Focusing on under-followed pockets of the market also helps, he said, citing mortgage securities in the Total Return fund.There are some warning signs when it comes to the flagship’s performance, however. While Total Return has beaten its index every full year except 2016, it’s lagging the benchmark in 2019 as well as over the past three years, according to data compiled by Bloomberg. The largest gains came in the first few years, as the U.S. economy rebounded from the housing crisis.Gundlach’s business success -- he’s personally worth an estimated $2 billion -- may also be hard to replicate in the future. Index funds that passively track benchmarks continue to gain popularity thanks to low fees and market-level performance.More mutual fund firms left the industry than entered from 2016 through 2018, according to the Investment Company Institute, the biggest three-year stretch of net exits since the aftermath of the 2000 tech crash. This time closings are coming during a bull market.DoubleLine By the NumbersCompliance costs for rules brought in following the financial crisis are more burdensome for small operators, according to Sean Collins, ICI’s chief economist, making it harder for startups.Another challenge for would-be Gundlachs is that shifts in the industry have driven advisers to recommend funds with the lowest fees rather than the best total returns, Collins said. While DoubleLine’s expense ratios are roughly in line with its peer group, according to Morningstar Inc., they’re well above the average passive fund.“The barriers to entering the big leagues of investment management are high,” Gundlach said this week by email. But, he said, “there is always demand for superior risk-adjusted returns.”While DoubleLine’s chief executive and chief investment officer is still the top draw, he has been diversifying the firm’s co-managers and fund lineup.In 2016, he named Jeffrey Sherman, who helped lead development of new equity, commodity and real estate funds, as deputy CIO. In July, DoubleLine promoted Andrew Hsu to co-manager of Total Return. Any active strategy brings “key man risk,” but the firm can position itself to keep thriving if Gundlach eventually retires or steps away, said CFRA’s Rosenbluth.“DoubleLine will strive to perform for our investors over the next 10 years as we have over the past 10 years,” Gundlach said.To contact the reporter on this story: John Gittelsohn in Los Angeles at johngitt@bloomberg.netTo contact the editors responsible for this story: Sam Mamudi at smamudi@bloomberg.net, ;David Gillen at dgillen3@bloomberg.net, Josh FriedmanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Scottish Nationalist Victory Sets Up Standoff Over Independence
(Bloomberg) -- Prime Minister Boris Johnson may be celebrating a stunning election victory, but another leader also scored an emphatic win -- and it’s one that promises to set up a renewed clash over the U.K.’s future.The Scottish National Party took back most of the districts it lost two years ago. Such a dramatic outcome –- winning 48 of the 59 seats available in Scotland -– will galvanize the party in its pursuit of the independence referendum leader Nicola Sturgeon says is necessary after her country opposed leaving the European Union.Johnson, like his predecessor Theresa May, has consistently resisted pressure from the SNP-led administration in Edinburgh for another independence vote. But the last one, when Scots chose to stay in the U.K. in 2014, was before the vote to leave the EU. Sturgeon made stopping Brexit and giving Scotland the right to dictate its own future the cornerstone of her party’s campaign.“Johnson has a mandate for Brexit and Sturgeon has a mandate for Scottish independence,” said Simon Hix, professor of political science at the London School of Economics. “We are heading towards a new constitutional crisis, which won’t be resolved easily in the next few years.”The SNP gained 13 seats, while Johnson’s Conservatives lost seven and Labour lost six to hold a solitary district in a country it dominated for most of the postwar period. The SNP held others with increased majorities and even took the seat of Liberal Democrat Party Leader Jo Swinson.“It shows the divergent paths that Scotland and the rest of the U.K. are on,” Sturgeon told the BBC from Glasgow. “It’s still my plan to submit an official request before the end of the year for a new independence referendum.”In Northern Ireland, pressure is also likely to grow for a referendum on unity with the Republic of Ireland, as nationalists made advances and unionist parties lost their majority.The SNP’s victory was noted elsewhere in Europe, with the head of the separatist administration of Catalonia tweeting his congratulations.BBC Scotland News @BBCScotlandNewsNicola Sturgeon says the SNP’s landslide victory at the general election in Scotland is a ‘mandate for indyref2’ bbc.in/2RNC6KP GE2019 BBCElectionhttp://twitter.com/BBCScotlandNews/statuses/1205386765135237120Sent via Twitter for iPhone.View original tweet.The election painted the opposite picture to 2017, when Theresa May ended up needing the dozen seats the Conservatives won from the SNP to remain in power. The nationalists lost more districts than they expected as then Scottish Conservative leader Ruth Davidson rallied opposition to another vote on leaving the three-centuries-old U.K. Davidson quit this year when Johnson became leader of the party nationally.The result means more SNP supporters will be agitating for Sturgeon to demand an independence vote –- regardless of whether the U.K. government acquiesces to one, a legal requirement. Humza Yousaf, Scotland’s justice minister, said that the referendum in 2014 was the “gold standard” and that Scotland would seek the legal agreement for a repeat vote next year.While polls have typically shown an independence referendum would be too close to call, two recent surveys gave a clear lead for sticking with the U.K. An SNP election victory would make the party’s army of activists more confident they can narrow the gap. Scottish Parliamentary elections are also due in 2021, when the SNP could reinforce its mandate for a referendum.“If Sturgeon wins big again in May 2021, Johnson will be unable to resist a second independence referendum,” said Hix.To contact the reporters on this story: Rodney Jefferson in Edinburgh at r.jefferson@bloomberg.net;Alastair Reed in Edinburgh at areed12@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas Penny, Robert HuttonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Corbyn to Stand Down as U.K. Labour Party Faces Record Defeat
(Bloomberg) -- Sign up to our Brexit Bulletin, follow us @Brexit and subscribe to our podcast.Jeremy Corbyn said he will stand down as leader of the U.K.’s opposition Labour Party after a comprehensive rejection of his bid to lead the country.Early results confirmed the exit poll forecast, which suggested Labour would lose 61 seats since the 2017 election, finishing on just 201 MPs, as Boris Johnson’s Conservatives head for a big majority. If correct, it would be Labour’s worst result since 1935.Defeated MPs and senior officials said the leader should go immediately, but Corbyn used a speech at his constituency count to say he wants to stay as leader to oversee a debate about the left-wing party’s future.“I will not lead the party in any future general election campaign,” Corbyn said before adding that there needs to be “a process of reflection” about Labour’s direction. “I will lead the party during that period to ensure that discussion takes place, and we can move on into the future.”That’s a sign that Corbyn and those around him want to try to control Labour’s direction and ensure that his allies have a firm grip on its organization. But anger is so great among critics in the party after Thursday’s result that they may try to force him out sooner.“Corbyn was a disaster on the doorstep. Everyone knew that he couldn’t lead the working class out of a paper bag,” Former Labour cabinet minister Alan Johnson told ITV.For the early part of the night, the Labour leader’s allies stuck to the line that the problem had been Brexit, not Corbyn. “It looks as though all other debate on other issues has been squeezed out by this one issue, Brexit,” Corbyn’s closest ally, Treasury spokesman John McDonnell told Sky News. “People just wanted it over and done with. It put Labour in a very difficult position.”But other MPs said there was a problem with the leader. Ian Murray, who was standing for the party in Edinburgh, said Corbyn’s leadership had come up repeatedly on the doorstep, while Gareth Snell, who said he expected to lose his seat in the former Labour stronghold of Stoke-on-Trent, said it’s time for Corbyn and McDonnell to go.The question among those around the Labour leader will now shift to whether their project, to make the party into an authentically socialist one, can be saved under a new standard bearer.That will depend partly on who is around to stand as Corbyn’s heir. But it will also depend on how Labour’s mass membership, who elect the leader, respond to the defeat.They put Corbyn in the job and defended him from Labour members of parliament who wanted him gone three years ago. Will the shock prompt them to go in a different direction, or will they accept the argument that the ideas were right, they were simply drowned out by Brexit?(Updates with Corbyn in third paragraph.)To contact the reporters on this story: Tim Ross in London at tross54@bloomberg.net;Alex Morales in London at amorales2@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas PennyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Mexico’s Senate Passes Changes to U.S., Canada Trade Deal
(Bloomberg) -- Mexico’s Senate passed changes to a new Nafta replacement free-trade deal with the U.S. and Canada after the governments of the three nations completed months of negotiations.The Senate voted 107 to 1 to approve the changes. It only needed to debate the latest adjustments, because the original agreement was ratified 114 to 4 in June, with broad support from President Andres Manuel Lopez Obrador’s Morena party and the next two biggest blocs.The move makes Mexico the first country to approve the revised deal with stronger labor protections announced on Tuesday by U.S. House Speaker Nancy Pelosi and backed by the largest American labor federation. Pelosi said she hopes for a vote before Congress recesses Dec. 20. Majority Leader Mitch McConnell said the Senate will vote after President Donald Trump’s impeachment trial, sometime in early 2020. Canada’s parliament is poised to take it up sometime next year.“In Mexico, we have already complied: the Executive signed and the Senate ratified the USMCA,” Lopez Obrador said in a Twitter post and video from his seat on a commercial flight returning from a day trip to the northern state of Sonora. “Now it’s up to the congresses of the United States and Canada to do the same. It’s good news.”On the back of the positive USMCA news this week and President Donald Trump signing off on a phase-one trade deal with China, the peso has strengthened 1.4% and briefly climbed to stronger than 19 per dollar, the best level since the end of July.U.S. House Democrats this week embraced the U.S.-Mexico-Canada trade agreement after securing key revisions and signaled they could vote on the deal next week, putting Trump closer to a political win as he heads into the 2020 election.Read more: New Nafta Leaves Winners and Losers Across North AmericaPelosi praised the changes her House Democrats were able to negotiate, saying the revised deal is better for American workers. She said the new version of the accord, known as the USMCA, will be a model for other trade agreements going forward.Trump welcomed the finalized overhaul of the North American Free Trade Agreement, which has been languishing for more than a year and could resolve some of the uncertainty weighing on the economy as he heads into his re-election campaign. But it is also a win for House Democrats who are eager to prove that they can do more than investigate and impeach Trump.Representatives from Canada, Mexico and the Trump administration met in Mexico City on Tuesday and signed the amendments to the trade agreement.(Adds comment from Lopez Obrador in fourth pargraph)To contact the reporter on this story: Eric Martin in Mexico City at emartin21@bloomberg.netTo contact the editors responsible for this story: Walter Brandimarte at wbrandimarte@bloomberg.net, Robert JamesonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Gold Smuggling on the Rise as High Prices Boost Appeal in India
(Bloomberg) -- Surging gold prices in India are keeping customs officials on their toes.Illegal inflows have jumped after the Indian government increased import taxes in July and prices surged to record highs in September. Customs officials have arrested people for attempting to smuggle in gold by concealing it in bags, clothes and their rectums. On one flight alone, officials caught 30 passengers trying to smuggle in 7.5 kilograms (16.5 pounds) of gold into Chennai.“The propensity to smuggle now is very high because every time you increase the tax rate, you give that much more incentive to smugglers,” P.R. Somasundaram, managing director for the region at the World Gold Council, said in an interview. “So it will continue like this unless measures are taken by not just the government but also the trade which shares an equal responsibility to obliterate the grey market.”Gold in India touched a record high of 39,885 rupees ($563) per 10 grams in early September on higher import taxes and as the U.S-China trade conflict and looser monetary policy boosted global benchmark spot prices. While bullion has since retreated from the all-time high, it’s still up 20% this year.Smuggled inflows of gold may jump 30% to 40% this year to 140 tons and rise more in 2020, N. Anantha Padmanaban, chairman of the All India Gem and Jewellery Domestic Council, said. It could also constitute a bigger percentage of India’s demand as official imports decline, rising to as much as 14% this year from 12% a year earlier, according to the WGC.A previous spate of smuggling occurred after India, which imports almost all of its gold, increased the tax three times in 2013 to control a record current-account deficit. Illegal inflows peaked at 225 tons in 2014 as smugglers attempted to bring in bullion, including via planes and trains.In just the two months of September and October this year, nearly 40% more gold was seized than the same period in 2018 from airports, railway stations and border states, data on the Directorate of Revenue Intelligence’s website showed. Data on the website is available only for the last four months of 2018, limiting year-on-year comparisons.There has been a jump in the smuggling of gold into India from China, Taiwanand Hong Kong, the DRI said. The trend suggests smuggling syndicates are using e-commerce platforms and couriers to smuggle gold into India by hiding it inhousehold and white goods, it said.“The higher import tax has led to not only the people who regularly smuggle gold to smuggle in the metal but it has encouraged even the lay man to go abroad and get some gold for their own consumption or to make money out of it,” All India Gem and Jewellery Domestic Council’s Padmanaban said by phone.Bullion is also increasingly being smuggled in from countries bordering India, including Nepal, Bhutan, Myanmar, China and Bangladesh.“The government needs to bring down the customs duty and also allow jewelers to be a part of the gold monetization scheme so that the idle gold with people comes into the market and we can cut down on imports,” Padmanaban said.\--With assistance from Ganesh Nagarajan and Shruti Srivastava.To contact the reporter on this story: Swansy Afonso in Mumbai at safonso2@bloomberg.netTo contact the editors responsible for this story: Phoebe Sedgman at psedgman2@bloomberg.net, Alpana SarmaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Weinstein’s Rage-Inducing Settlement Is the Norm for Civil Suits
(Bloomberg Opinion) -- Critics have their knives out for the proposed $47 million settlement of most of the civil suits filed against Harvey Weinstein and his defunct production company by women accusing him of sexual assault or other forms of misconduct. The settlement includes $25 million for the accusers, most of whom will receive about $500,000 each, although a few will get more.Nobody’s happy. The head of victims-rights group Time’s Up called the deal “a symptom of a problematic, broken system that privileges powerful abusers at the expense of survivors.” A lawyer for one of the accusers, searching for a way to express his fury at the additional $12 million allocated for the defense of Weinstein and the company’s directors, found an unlikely metaphor: “The agreement is akin to the United States giving military aid to Iran so that it could attack Israel.” And if you want to see fury and pain more colorfully expressed, just take a peek at metoo on Twitter these last few days.(1)I’m not about to defend Harvey Weinstein. If only a small fraction of the allegations against him are true, the man is the definition of a monster. But while it’s easy to understand why people are so angry and bewildered, we should take a moment to add a bit of legal context.Let’s begin with some hard facts. Except in the movies, civil suits hardly ever go to trial. An estimated 97% or more are settled, dropped, or dismissed. A well-regarded 2008 study found that the majority of civil plaintiffs who reject a proposed settlement wound up worse off by going to trial — either because the jury awarded damages of less than the settlement amount or because the jury ruled for the defendant.Experienced trial lawyers understand the risks of turning down a settlement; good lawyers make sure their clients understand them, too. Some of Weinstein’s accusers are refusing to participate — among the holdouts is the actress Ashley Judd, who is suing him for defamation — but one can expect that nearly all the plaintiffs will throw in the towel, and for the same reason: They think the proposed settlement is the best they’re likely to get, and they prefer not to press on and risk getting less ... or nothing.Here the risk of getting nothing may be particularly high. Plaintiffs who opt in must waive further legal claims against Weinstein, the Weinstein Company, or its board of directors. Those who opt out will henceforth be proceeding against a bankrupt company and a likely soon-to-be-bankrupt Weinstein. In other words, the plaintiffs who continue to litigate are unlikely to collect very much.Part of the challenge for those who opt out is that the insurance companies will have abandoned the field. The point of the settlement is to make clear the limits of the insurers’ obligations to Weinstein and the company. For better or worse, an insurance company has no duty to those the insured has harmed. Except in a handful of jurisdictions, it’s hornbook contract law that you can sue the person who hurts you but not that person’s insurer.Anger about the $12 million going to pay lawyers for both Weinstein and the directors is understandable but misguided. Typical “directors and officers” policies will pay the insured’s legal fees up to the policy limit, with exclusions for certain transgressions. The lawyers’ fees appear to be a settlement of a dispute over how much of the litigation cost the insurers will cover. The $12 million set aside for this purpose would not otherwise be going to compensate Weinstein’s victims.As to the fact that Weinstein admits no wrongdoing, that, alas, is necessary to the settlement, if only because any statement of fault on his part would be admissible should criminal or other civil litigation arise out of the settled incidents. That we might all agree that he’s a monster is here beside the point. The problem is that if civil defendants, in order to settle their cases, had to admit their wrongs, every case would instead be litigated, and the waiting list for courtroom time would be decades long.If news reports are accurate, the settlement is not much different from the one proposed over the summer. Maybe that was the moment for anger, back when there was time to renegotiate. Now it’s a fait accompli. Yes, there was talk last year of a much larger fund for Weinstein’s victims — perhaps as much as $90 million. But that proposal was to be funded by a sale of the Weinstein Company to investors; when that deal collapsed, so did the fund.Where does that leave Weinstein’s accusers? Probably in a space of unimaginable pain. Most will take the settlement, understanding that this is probably the best they can get. Others will fight on in court, less I suspect in the hope of uncovering some hidden assets than for the satisfaction of watching their attacker squirm on the witness stand and assert his Fifth Amendment rights.Public justice, however, will have to await the outcome of Weinstein’s forthcoming trial on criminal charges — a trial that could prove to be the first of several. Yes, the Twitterverse is full of worry that the rich and famous never go to prison, at least for sexual assault. But Bill Cosby, who is likely much richer than Harvey Weinstein, is serving a 3 to 10 year sentence for that very crime, and just this week his appeal was rejected.(1) A number of critics have pointed out on social media that the proposed $25 million settlement is less than Weinstein himself received last year when he sold his townhouse in the West Village.To contact the author of this story: Stephen L. Carter at scarter01@bloomberg.netTo contact the editor responsible for this story: Sarah Green Carmichael at sgreencarmic@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Stephen L. Carter is a Bloomberg Opinion columnist. He is a professor of law at Yale University and was a clerk to U.S. Supreme Court Justice Thurgood Marshall. His novels include “The Emperor of Ocean Park,” and his latest nonfiction book is “Invisible: The Forgotten Story of the Black Woman Lawyer Who Took Down America's Most Powerful Mobster.” For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Bloomberg
How Stephen Strasburg's $245 Million Deal Is Structured to Pay Far Less
(Bloomberg) -- Savvy dealmaking or mortgaging the future?In certain nerdy baseball circles, it is a question that’s been asked about the Washington Nationals for years now because of its prolific use of deferred money in structuring multi-year player contracts. After the team re-signed World Series MVP Stephen Strasburg earlier this week to what was, briefly, the richest deal ever for a pitcher, it’s come to the fore yet again.On its face, Strasburg’s seven-year, $245 million deal works out to $35 million a year -- just a million dollars less per year than the record-shattering, nine-year, $324 million contract that Gerrit Cole signed with the New York Yankees Tuesday. (Cole, 29, ostensibly got two more years and $1 million more a year because he’s two years younger, and one could argue, better.)But the Lerner family, which owns the Nationals, won’t actually be paying the 31-year-old righty nearly as much over the life of his contract. A whopping $80 million, equal to one-third of the contract’s total value, won’t be paid until 2027. And that IOU, which will be paid in three annual installments after the actual contract ends, only accrues interest at a paltry rate of 1% a year.Effectively, that means the Nationals have locked Strasburg up for $23.6 million a year -- a hefty hometown discount to Cole’s $36 million-a-year deal -- for the next seven years, based on figures compiled by Cot’s Baseball Contracts.Of course, plenty of other teams have deferred contracts on their books -- Bobby Bonilla day is an annual holiday for baseball junkies for good reason -- but when it comes to creative financing, few organizations anywhere in professional sports come close to pushing the envelope like the Nationals.In 2015, Max Scherzer, the team’s other ace, deferred nearly half of his seven-year, $210 million contract at 0% interest. Pitcher Patrick Corbin’s contract and former second-baseman Daniel Murphy also agreed to zero-interest, deferred deals. Moreover, former star third-baseman Ryan Zimmerman has a personal-services contract -- a practice that has since been banned by Major League Baseball -- that will pay him a total of $10 million over five years once he hangs up his cleats.And that doesn’t include deals that were rejected. The team reportedly offered outfielder Bryce Harper a $300 million deal that would have deferred a third of that and stretched out the payments until the former MVP hits age 60.The Nationals have been mum on the issue, but it’s not hard to see why it would make sense, according to Marc Edelman, a law professor at the Zicklin School of Business at Baruch College, who consults extensively on legal and business issues in sports.By persuading players to take less money upfront, it gives the reigning World Series champs more financial flexibility to keep their team together and win now. (For the purposes of the competitive balance tax, baseball’s version of a soft salary cap, deferred payments without interest can provide relief.)And as the value of sports franchises grow and revenues from television broadcasting rights increase, pushing out fixed obligations into the future could be a smart move. For players, whose careers are relatively short, deferred compensation creates a de facto retirement savings plan they can dip into once their playing days end. And agents benefit from the arrangement because it’s the nominal values that typically set market prices.“If the interest rate is really only 0 or 1%, that would seem to be a bit surprising based on the time value of money, but presumptively the person negotiating the contract understands this and they’re negotiating that interest rate cost into the value of the contract,” Edelman said.The strategy isn’t without risk, though. Backloading so many contracts, of course, could eventually hamstring the Nationals once they need to start replacing their current crop of All-Stars and hamper their ability to compete for the best players in free agency in the future.For example, the Nationals will owe Scherzer and Strasburg a combined $41.7 million in each of 2027 and 2028. Neither ace is currently under contract for those years. Both pitchers were represented by superstar agent Scott Boras in their negotiations.The 2001 World Series champion Arizona Diamondbacks are an example of how the strategy could go wrong, according to Brett Albert, a faculty lecturer at the Isenberg School of Management at University of Massachusetts, Amherst.“The early 2000s, Diamondbacks were really aggressive about deferring salaries for players like Randy Johnson and Curt Schilling,” he said. “They won a World Series, but the revenue streams never materialized like they anticipated they would and they had to subsequently gut their roster.”Albert says the decision to defer liabilities into the future comes down to an ownership group’s tolerance for risk. Lucrative TV deals and revenue sharing agreements mean there’s a lot of room for error, but a recession, for example, could always make tickets at the ballpark harder to sell.For his part, Cole decided that money is more valuable in the present. He reportedly turned down an eight-year, $300 million dollar offer from the Los Angeles Dodgers. That deal had a higher average annual value, but also featured deferrals.To contact the reporter on this story: Brandon Kochkodin in New York at bkochkodin@bloomberg.netTo contact the editors responsible for this story: Joe Weisenthal at jweisenthal@bloomberg.net, Michael Tsang, Larry ReibsteinFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Tech Makes Life on the Coasts Tough for Banks
(Bloomberg Opinion) -- Why is the nation's financial industry concentrated in just a few very costly cities?The latest actions by the Charles Schwab Corp. suggest there's less reason than there once was amid the squeeze the industry has been feeling since the Great Recession ended. In Schwab's case -- amid slow economic growth, low interest rates and continued pressure on trading commissions -- the discount brokerage firm slashed its fees, said it would buy a main rival and move its headquarters from high-cost San Francisco to more-affordable Dallas. It may not be the last to make such a move.No matter what part of the financial services or banking ecosystems you look at, revenues are harder to come by today than they were 10 or 20 years ago. Trading commissions have fallen, with online brokerages ushering in zero commissions. Bid-ask spreads for market makers have narrowed. Management fees for mutual funds and hedge funds continue to shrink. Mutual funds are losing market share to low-cost exchange-traded funds. Net interest margins for banks have been compressed by both low interest rates and a flatter yield curve. The Volcker rule restricted some of the more lucrative activities banks can do. Higher capital requirements have reduced the profitability of the banks. Loan growth has been anemic since the financial crisis. And increasingly, private companies are looking to do direct listings on stock markets rather than initial public offerings, threatening bank underwriting fees.And at the same time that revenues have been pressured, the costs of operating in coastal urban hubs where the finance industry has traditionally been clustered continue to rise. Although conservatives might snicker and chalk it up to the higher taxes in coastal finance centers, the bigger story has been the concentration of the technology industry and the young, highly paid knowledge workers they hire. In the first decade of the 2000s, when the credit and housing booms were roaring, the tech industry played second fiddle to finance when it came to urban employment. Even San Francisco was relatively tech-free until Twitter set up shop in the latter half of the decade. Rents, although high, were manageable for many workers with good financial industry jobs.That's no longer the case. With tech on a tear, young college-educated workers have, in turn, clustered in a handful of cities to gain access to more job opportunities. This dynamic has driven up rents in New York and San Francisco, posing stiff competition for financial companies looking to hire workers with the same types of skills prized by tech firms. The mediocre post-recession environment in finance has also meant banking and investment firms often find themselves outbid for talent.For the financial industry, that means if you can't beat 'em, retreat to cheaper pastures. That helps explain why Goldman Sachs has expanded in Salt Lake City; AllianceBernstein is planning to move its headquarters from New York to Nashville, Tennessee; and BlackRock is opening an "innovation center" in Atlanta. Perhaps the most significant announcement was made by JPMorgan Chief Executive Officer Jamie Dimon in October, when he said that he expects Texas to eventually overtake New York as the state with more of the bank's employees than any other.As with the shifts in the manufacturing industry, these changes take place over years and decades, but it's likely that the trend of decentralization will continue. Although Schwab is a high-profile financial firm moving its headquarters out of San Francisco, a much bigger one -- Wells Fargo -- remains based there. But for how long? The scandal-plagued bank recently hired a new chief executive, but he plans to remain in New York rather than move to the West Coast. The bank has five times as many job postings on its website in Charlotte, North Carolina, thanks to its acquisition of Wachovia, as it does in San Francisco. It wouldn't be a surprise if -- as part of its long-term repositioning strategy -- a headquarters relocation is part of the mix.It's been a bit more than a decade since the financial crisis, and banks and financial-services firms have had enough time to dust themselves off and adjust to the new environment for the industry. If the 2000s were defined by the bust, and the 2010s were a period of recovery and sluggish growth, then maybe the 2020s will be when the industry consolidates and finally lowers costs by shifting to cheaper cities.To contact the author of this story: Conor Sen at csen9@bloomberg.netTo contact the editor responsible for this story: James Greiff at jgreiff@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Conor Sen is a Bloomberg Opinion columnist. He is a portfolio manager for New River Investments in Atlanta and has been a contributor to the Atlantic and Business Insider.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Bloomberg
Lagarde Marks ECB Policy Debut With Optimistic Note for Economy
(Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.Christine Lagarde said the euro zone’s economic slowdown is showing signs of bottoming out, in comments after her first policy meeting as president of the European Central Bank that suggested further interest-rate cuts are unlikely any time soon.“There are some initial signs of stabilization in the growth slowdown and of a mild increase in underlying inflation,” she told reporters on Thursday. “The risks surrounding the euro-area growth outlook, related to geopolitical factors, rising protectionism and vulnerabilities in emerging markets, remain tilted to the downside, but have become somewhat less pronounced.”The euro jumped as high as $1.1154 before paring gains to trade up 0.1% at $1.1141 at 3:21 p.m. Frankfurt time.Still, the president unveiled updated economic forecasts that showed a muted outlook for now. Growth will be 1.1% next year -- a slight revision lower -- and 1.4% in 2021, the bank predicted. The first outlook for 2022 showed an expansion of 1.4%. Inflation that year is seen at 1.6% -- still below the goal of just under 2%.The Governing Council earlier held its deposit rate at a record-low minus 0.5%, and bond purchases at 20 billion euros ($22 billion) a month, sticking to a controversial package unveiled in September.Yet pressed on whether it’ll need to take further action, Lagarde said that “we are very aware of the side effects” of negative rates, and called on governments to help out with fiscal stimulus and structural reforms. “It would be very welcome to have other policies join the monetary policy in order to support the reduction of slack.”Strategic ReviewShe also reiterated her pledge to undertake the central bank’s first strategic review since 2003, saying it is “overdue” and should be started in January, to be completed before the end of the year.While a key part of the assessment will be whether the inflation goal needs to be adjusted, it will be “comprehensive,” Lagarde said. It’ll include consultation with members of the European Parliament, the academic community and representatives of civil society, with no “preconceived landing zone.”Read more: Lagarde’s Voila! Shows Ownership of ECB With Her Own StyleIt will address challenges including climate change, technology, and rising inequality, and Lagarde expressed disappointment that the European Union was unable to agree this week on a set of standards for defining green investments. That would have been “extremely helpful” for the ECB to contribute to combating global warming, she said -- issuing a “call to find an agreement.”Her ambitious plans have worried some ECB officials though, who fear being diverted from their primary mandate of restoring price stability. Inflation has averaged just 1.2% so far in 2019, despite years of unprecedented and often contentious stimulus.While some economic indicators have suggested lately that the bloc’s slowdown might be easing, Germany remains embroiled in its worst manufacturing slump in a decade, and the U.S.-China trade war and Brexit have continued to weigh on growth. Lagarde said the latest signs are that U.S.-China talks are “heading in a better direction.”The key message was that while price stability is the core mandate, Lagarde -- who formerly ran the International Monetary Fund and is the first ECB leader never to have worked at a central bank -- wants to do much more. The review will “explore each and every corner” of the institution’s operations to “better respond to serving euro-area citizens” as well as delivering on the price-stability mandate.\--With assistance from Jana Randow, Zoe Schneeweiss, Fergal O'Brien, Craig Stirling, Brian Swint, Jeannette Neumann, Carolynn Look, David Goodman, Jill Ward and Catherine Bosley.To contact the reporters on this story: Paul Gordon in Frankfurt at pgordon6@bloomberg.net;Piotr Skolimowski in Frankfurt at pskolimowski@bloomberg.netTo contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Jana Randow, Iain RogersFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
SNB’s Jordan Defends Negative Rate Policy as Criticism Mounts
(Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.Swiss National Bank President Thomas Jordan unleashed a staunch defense of negative interest rates, insisting the controversial policy is the only way to keep the franc in check and help the economy.As Switzerland approaches the five-year anniversary of its minus 0.75% deposit rate, the lowest in the world, Jordan’s remarks at Thursday’s monetary policy press conference were dominated by subzero rates. Pushing back against critics, he said ending it would spark the worst of scenarios -- a “marked and rapid” currency appreciation, along with deflation and weaker economic growth.Jordan has long been unwavering in this view, but his latest comments follow increasingly vocal opposition from the financial sector to what is effectively a charge on deposits. In the neighboring euro zone, some officials give the impression of losing faith in the measure, while Sweden’s central bank is poised to end its experiment with the policy.Lenders in Switzerland and elsewhere say margins are under pressure. The Swiss Bankers Association has argued negative rates are no longer necessary, and a survey by UBS Group AG found that even export-oriented firms believed the policy was doing more harm than good.Jordan spoke after the SNB left interest rates unchanged and reiterated its threat to intervene in currency markets if needed. He acknowledged the “challenges” of its subzero policy, but offered no sign he’s about to change tack anytime soon.“We monitor the impact of negative interest precisely, and we take the side effects seriously. However, we remain convinced that the benefits it brings Switzerland as a whole clearly outweigh the costs. The negative interest rate and the willingness to intervene are currently the best instruments.”The SNB’s latest forecasts bear out his concerns. Similar to their peers, Swiss policy makers have struggled to stoke price pressures, though their situation is complicated by the currency. They’ve long described the franc as “highly valued,” a key phrase they repeated on Thursday.In the latest projections, inflation is seen at just 0.1% in 2020 and only slightly faster, at 0.5%, the following year.Economic growth is expected to pick up in 2020, though Jordan noted the “downside risks” in the global economy.The franc has gained more than 3% against the euro this year because of increased global risks and the European Central Bank monetary easing in September. It’s been relatively steady recently, though a further appreciation remains a risk.That would be a big a headache for manufacturers, who have suffered a drop in foreign orders as a result of the trade war and the upheaval among German carmakers.“Negative interest remains central to our monetary policy to this day,” Jordan said. “If we were to dispense with it, Swiss interest rates would increase compared to those of other countries, Swiss franc investments would be markedly more attractive, and we would have to expect a marked and rapid appreciation in our currency.”\--With assistance from Jana Randow, Harumi Ichikura, Lukas Strobl, Zoe Schneeweiss, Daniel Schaefer and Brian Swint.To contact the reporters on this story: Catherine Bosley in Zurich at cbosley1@bloomberg.net;Jan Dahinten in Zurich at jdahinten@bloomberg.netTo contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Craig Stirling, Paul GordonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Reuters
Twitter plans to build 'decentralized standard' for social networks
The system, or "standard," would not be owned by any single private company, Dorsey said, and would enable individuals to use a variety of services to access the same network, just like they choose different email providers to see the same messages. Policing speech on social media sites has required hefty investments while still failing to stem criticism from users who find the policies either too aggressive or too lax. "Centralized enforcement of global policy to address abuse and misleading information is unlikely to scale over the long-term without placing far too much burden on people," Dorsey tweeted https://twitter.com/jack/status/1204766078468911106.
- Bloomberg
Chevron Ushers in Oil’s Era of the Sober-Major
(Bloomberg Opinion) -- Along with never invading Russia or getting into a Twitter argument, we can add another golden rule — this one specifically for U.S. oil majors: Never buy a shale-gas business.Chevron Corp.’s $10-11 billion impairment, announced late Tuesday, relates mostly to the Appalachian gas assets it picked up in 2011’s $4.9 billion acquisition of Atlas Energy Inc. Back then, the Permian basin was not a regular topic on the business channels, nor was it a central pillar of Chevron’s spending plans. But now it is, and simultaneously plowing billions into a Permian oil business that spits out gas essentially for free while running a dry-gas business in the Marcellus shale is like flooring it with the parking brake on.Chevron joins the ranks of Exxon Mobil Corp. — which paid $35 billion for XTO Energy Inc. less than a year before the Atlas deal and has been haunted by it ever since — and ConocoPhillips, which bought Rockies gas producer Burlington Resources Inc. way back in 2006 for $36 billion and then wrote most of that off in 2008.But there is far more to this than just mistimed forays into the graveyard of optimism that is the U.S. natural gas market — and not just for Chevron.Big Oil just had a forgettable earnings season. Chevron announced cost overruns on the giant Tengiz expansion project in Kazakhstan. Exxon continued borrowing to cover its dividend. Across the pond, BP Plc and Royal Dutch Shell Plc flubbed resetting expectations on dividends and buybacks. What ties all of these together are weak returns on capital. Chevron’s problems in Kazakhstan are echoed in its impairment of another asset, the Big Foot field in the Gulf of Mexico. This is another mega-project that went awry and, in an era when producers can no longer count on an oil upswing to save the economics, is found wanting. Chevron is also ditching the Kitimat LNG project in Canada that it bought into in 2013.All this is a particularly sore spot for Chevron given its problems with Australian liquefied natural gas mega-projects earlier this decade. CEO Mike Wirth’s decision to clear the decks seems intended in part to signal that, unlike the experience of his predecessor with Australian LNG development, he will drop big assets that don’t make the cut financially.Discovering, financing and developing mega-projects is why the supermajors were created at the end of the 1990s. Today, when investors are interested at all, they’re leery of capital outlays, aware the outlook for oil and gas markets is challenged in fundamental ways. So tying up money in big, risky, multi-year ventures is a good way to crush your stock price.Wirth isn’t abandoning conventional development; Big Foot aside, the Gulf Of Mexico has several new projects in the pipeline, for example. But to offset the drag on returns from the extra spending at Tengiz, he must streamline the rest of the portfolio. This is the story of the sector writ large. “Too much capital is chasing too few opportunities,” as Doug Terreson of Evercore ISI puts it. Conoco, which remade itself radically after the Burlington debacle, set the tone with its recent analyst day, emphasizing the need to get the industry’s long-standing spending habits under control and focus on returns to win back investors who are free to put their money into other sectors. Chevron’s write-offs and shareholder payouts (38% of cash from operations over the past 12 months) are of a piece with this. While the company has laid out guidance for production to grow by 3% to 4% a year, that is very much subject to the returns on offer. Capital intensity — as in, shrinking it — is what counts.Chevron’s move throws the spotlight especially on big rival Exxon. While Exxon has taken some impairment against its U.S. gas assets, that represented a small fraction of the XTO purchase. Exxon also sticks out right now for its giant capex budget (bigger than Chevron’s by more than half), leaving no room for buybacks or even to fully cover its dividend.In the first decade of the supermajors, when peak oil supply was a thing, big projects with big budgets to match were something to boast about. As the second decade draws to an end, only the leanest operators will survive. Chevron won’t be the last oil major to rip off the band-aid, just as we haven’t yet seen the full extent of the inevitable restructurings and consolidation among the smaller E&P companies. On this front, there’s another golden rule: Better to get it done sooner rather than later. To contact the author of this story: Liam Denning at ldenning1@bloomberg.netTo contact the editor responsible for this story: Mark Gongloff at mgongloff1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Bloomberg
Russian Artist Puts $150,000 Banana to Shame
(Bloomberg Opinion) -- Forget Maurizio Cattelan’s $150,000 banana, duct-taped to the wall at Art Basel in Miami last week and eaten by a less well-known trickster artist. (The buyers of the artwork are fine with that — it came with a manual that prescribes replacing the fruit every week or so, anyway.) The best art of this type comes from Russia, because there, it actually means something.The art object that, as any responsible critic should recognize, eclipses Cattelan’s headline-grabbing “Comedian,” was sold online on Dec. 9 for 1.5 million rubles ($23,600). It was created by Artem Loskutov, an artist from Novosibirsk, Russia, who started the now nationwide tradition of “Monstrations,” annual rallies where people carry nonsensical signs. (“We Can’t be Knocked Off Course: We Don’t Know Where We’re Going,” one said this year.) The object is a piece of canvas-covered cardboard with a steel plaque glued to it and Loskutov’s signature, in marker, underneath. On the plaque, a woman named Nailya professes her love for a man named Andrey Kostin, in English, and tells him, “We are of the same blood,” an apparent corruption of the line from Rudyard Kipling’s “Jungle Book,” “We be of one blood, ye and I.”Loskutov’s description of the materials used in creating the work says, “found object, stainless steel, 5X14 cm; marker, canvas on cardboard.” But the plaque is, strictly speaking, a stolen object, not a “found” one. Until a few days ago, it was affixed to one of the 6,800 benches in New York City’s Central Park “adopted” by donors to the Central Park Conservancy.It came from what’s probably now the most famous of these benches: Earlier this month, it got a prominent mention in a 29-minute video by anti-corruption activist Alexey Navalny, an arch-foe of Russian President Vladimir Putin, that has been viewed more than 5 million times (and counting) on YouTube. The video is dedicated to the relationship between Andrey Kostin, the (married) president and chief executive officer of the state-owned bank VTB and state television anchor Nailya Asker-Zade. The state banker, according to Navalny, has showered Asker-Zade with expensive gifts, including prime real estate and the use of a yacht and a private plane. The cost of it all appears to be too high even for Kostin’s significant legitimate income, Navalny wrote.Kostin hasn’t commented on the video, nor has VTB, Russia’s second biggest bank by assets. Asker-Zade, known for her fawning interviews with members of Putin’s close circle, thanked Navalny on Instagram for the publicity.Navalny’s made-for-YouTube investigations are political tools rather than journalistic endeavors, and much of the film’s substance should probably be classed as opinion rather than fact. But when it comes to the Central Park plaque, Asker-Zade is mentioned in Central Park Conservancy’s 2015 annual report among donors of between $10,000 and $24,999. Navalny specializes in exposing impossibly lavish lifestyles that embarrass Putin allies and scandalize the average Russian. Judging by his video’s viral spread and the indignant comments it’s spawned on social networks, he handily hit his mark here.To put his allegations in context, Navalny wrote in a separate post that by his count the total value of the gifts is comparable to the amount that’s been raised by Rusfond, one of Russia’s biggest charities dedicated to funding medical treatment for seriously ill children, over its 23-year history. That would be difficult to prove, but is important for what happened next.Suddenly, the plaque disappeared from the bench, an event Navalny was quick to report on Twitter. On Dec. 9, it resurfaced in Loskutov’s possession. To turn it into art, Loskutov didn’t just paste it on cardboard and scribble his name underneath. He promised to donate the proceeds from its sale to Rusfond. The same day, he announced the object had fetched 1.5 million rubles in an informal auction he had run online. (The original screws from the bench were offered as a bonus.) To complete the performance, proof of the transfer to Rusfond is still needed. But Loskutov’s work has already garnered numerous comments to his tweets and Facebook posts — both accusing him of theft (even many Putin foes were uneasy about this) and praising him for his audacity. One commentator summed the whole situation up like this: “They stole our money and we’ll steal their memories.” Although there's no proof Asker-Zade or Kostin engaged in theft.On Tuesday, Loskutov took to Facebook and Twitter again to post a quote attributed to a host of greats, most often to Pablo Picasso: “Good artists copy, great artists steal.” It’s unclear, though, if he meant himself or the bureaucrats and managers of state-owned companies whom Navalny often accuses of graft.The New York Times’ art critic Jason Farago recently offered what he called “a reluctant defense” of Cattelan’s banana on the basis of the artist’s “willingness to implicate himself within the economic, social and discursive systems that structure how we see and what we value.” If that defense is valid, Loskutov’s action works on more levels than Cattelan’s work. It’s art as Robin Hood-style theft, art as tabloid journalism, art as political protest, art as social commentary, art as commerce and art as charity all rolled into one. It’s not a case of art imitating life or the other way round, but art’s bold intrusion into life as it plays out under one of the world’s most dispiriting authoritarian regimes.Loskutov’s performance, whatever its consequences for him, deserves a place among other audacious Russian art works such as Voina Art Group’s 2010 depiction of a gigantic penis on a St. Petersburg drawbridge exactly opposite the secret police office or Petr Pavlensky nailing himself to the pavement on Moscow’s Red Square in 2013. It’s easy these days to be cynical about the value of art and to play tricks on audiences based on the amount of money some wealthy people are willing to pay for fatuous objects. It’s much riskier, and much more meaningful, to challenge allegedly corrupt elites and the enforcers and benefactors of authoritarian nations. Where political opposition is feeble, art has a role to play.To contact the author of this story: Leonid Bershidsky at lbershidsky@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Leonid Bershidsky is Bloomberg Opinion's Europe columnist. He was the founding editor of the Russian business daily Vedomosti and founded the opinion website Slon.ru.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Simply Wall St.
Should Twitter, Inc.’s (NYSE:TWTR) Weak Investment Returns Worry You?
Today we are going to look at Twitter, Inc. (NYSE:TWTR) to see whether it might be an attractive investment prospect...
- TechCrunch
Twitter will now preserve JPEG quality for photo uploads on the web
Twitter is changing the way it processes uploaded images, and the new way of doing things will be much-appreciated by any photographers sharing their work on the platform. Twitter engineer Nolan O'Brien shared that the platform will now preserve JPEG encoding when they're uploaded via Twitter on the web, instead of transcoding them, which results in a degradation in quality that can be frustrating for photo pros and enthusiasts. There are some limitations to keep in mind -- Twitter will still be transcoding and compressing the thumbnails for the images, which is what you see in your Twitter feed.
- Bloomberg
U.S. Cattle Ranchers Blast New Nafta as Other Farmers Cheer
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. The American agriculture industry generally applauded a move to finalize the U.S.-Mexico-Canada free-trade agreement, with one notable exception.In a statement Tuesday, cattle producer group R-CALF USA blasted the deal, saying the failure to restore country of origin labeling, or COOL, on beef allows imported supplies to continue undercutting U.S. ranchers.The group said COOL rules for beef and pork that were repealed in 2016 would have allowed U.S. ranchers to “compete against the duty-free, cheaper and undifferentiated cattle and beef flowing into our country and depressing our markets.”Opposition to the deal was relatively limited as U.S. farmers should largely gain from tariff-free access to the neighboring countries. One big beneficiary would be beleaguered U.S. dairy farmers, who would get new access to Canada’s marketCrop handler and processor Archer-Daniels-Midland Co. said USMCA will provide “meaningful benefits for agriculture and food industries in all three countries.”Meanwhile, the National Cattlemen’s Beef Association, which represents cattle farmers and feeders, said: “There is no higher policy priority for America’s beef producers than maintaining our duty-free access to Canada and Mexico.”\--With assistance from Isis Almeida, Dominic Carey and Mike Dorning.To contact the reporter on this story: Michael Hirtzer in Chicago at mhirtzer@bloomberg.netTo contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net, Patrick McKiernanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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Congress Flexes Foreign-Policy Muscle With Rebukes of Trump
(Bloomberg) -- President Donald Trump will face a more assertive Congress on foreign policy as he fights off impeachment and seeks re-election, with lawmakers pushing legislation at odds with his priorities and personal style on the global stage.This will be on full display Wednesday when the Republican-led Senate Foreign Relations Committee considers sanctions on Turkey and Russia, both countries that Trump has tried to court despite Congress’s wariness. The panel has also been the driving force behind two recent laws to support Hong Kong protesters, which Trump reluctantly signed despite Chinese threats of retaliation.In recent months, the Senate’s GOP majority has been more likely to agree with House Democrats on foreign policy than with the Trump administration. Even the president’s closest allies in Congress criticized him for withdrawing American troops from Syria, inviting Turkish President Recep Tayyip Erdogan to the White House and selling arms to Saudi Arabia.Lawmakers last week called for the suspension of a training program for foreign fighters after a Saudi air force officer shot and killed three U.S. service-members at Naval base in Pensacola, Florida. Trump, on the other hand, tweeted that he had received “sincere condolences” from Saudi Arabia’s king.“It’s time that Congress reestablish its Article I prerogatives by not just asking probing questions but also by resuming legislative activity on a once very visible and consequential committee,” said Republican Senator Todd Young of Indiana, describing the Foreign Relations panel and the article of the Constitution that lays out Congress’s powers. “Any administration should have to show their work.”Foreign policy decisions are also the foundation of the impeachment investigation that is hurtling through the House of Representatives. Democrats are building the case that Trump subverted official U.S. diplomacy in Ukraine for his personal political benefit.The main impeachment allegation is that the president withheld nearly $400 million in security aid for Ukraine and a White House meeting in exchange for newly elected President Volodymyr Zelenskiy announcing politically motivated investigations.Weeks before this touched off the impeachment inquiry, Republicans lobbied the White House to find out why the congressionally approved security assistance had been delayed. GOP Senators including Wisconsin’s Ron Johnson and Majority Leader Mitch McConnell publicly and privately pressed administration officials to release the aid they said was critical to fend off Russian aggression in eastern Ukraine.Not Always in LockstepEven as most Republicans oppose impeachment, many of them are willing to part ways with Trump on other issues of foreign policy.”We’re not always in lockstep with everything that comes out of the White House and when we’re not, we have a responsibility to voice that,” said Michael McCaul of Texas, the top Republican on the House Foreign Affairs Committee.There is also a broader effort to check Trump’s power. Young, a former Marine, has sponsored several proposals to wrest control of foreign policy away from the executive branch. His bill with New Jersey Senator Bob Menendez, the top Democrat on the Foreign Relations Committee, would require the administration to consult Congress on troop levels in Afghanistan and any final agreement with the Taliban.“It’s incredibly important that Congress and the Senate Foreign Relations Committee in particular maintains a high level of oversight over the longest war in American history,” Young said of Afghanistan, where Trump recently said he was pursuing a new peace deal.This push for oversight took on greater urgency after Trump in October abruptly announced the withdrawal from northern Syria shortly after a telephone conversation with Erdogan. Republicans were outraged when Turkey invaded territory controlled by the Kurds, a U.S. ally in the fight against Islamic State.McConnell, one of Trump’s most imperturbable allies, warned that pulling out U.S. troops from the region would leave the Kurds vulnerable to attack and risk giving a foothold to jihadist fighters.“We hope the damage in Syria can be undone,” McConnell said at the time. “But perhaps even more importantly, we absolutely must take steps so the same mistakes are not repeated in Iraq or Afghanistan.”Another Republican who usually supports Trump, Texas Senator Ted Cruz has been furiously campaigning for sanctions to halt the Nord Stream 2 pipeline he says will increase Russian President Vladimir Putin’s influence in Europe to the detriment of the U.S.If the gas pipeline, from Russia to Germany, is completed, “it will be the fault of the members of this administration who sat on their rear ends,” Cruz said last week. “You have an overwhelming bipartisan mandate from Congress to stop this pipeline.”Cruz fought to include the sanctions in the final version of the defense spending bill expected to pass before the end of the year.Another provision in the National Defense Authorization Act would require the Secretary of Defense to certify that a reduction of U.S. forces in South Korea is in the national security interest. The White House said in a statement Tuesday that Trump supports the NDAA.Republicans have also expressed frustration with their colleagues who blocked a resolution recognizing the Armenian genocide, which Turkey opposes. Cruz said he has heard “no good reason for the administration to object” to the measure.Turkey SanctionsThe Turkey sanctions bill before the Senate Foreign Relations Committee this week would sanction the country’s leaders, financial institutions and military that aided the invasion of northern Syria. In a remarkable display of bipartisan support, the House passed its version 430-16 in October.Senator Tim Kaine, a Virginia Democrat on the Foreign Relations Committee, said he expects robust support for the Turkey sanctions bill when it goes to the Senate floor. Both chambers will need to pass the same version before sending it to Trump to sign into law.“The House bill came over definitely veto-proof and we’ll likely do something that the House will also agree with,” Kaine said. “That’s a bipartisan understanding.”Reaching a veto-proof majority represents even stronger backing for bills opposing Trump’s foreign policy initiatives than legislation earlier this year to end U.S. support for the Saudi-led military campaign in Yemen and ban arms sales to Saudi Arabia. Those easily passed both chambers, but lacked the votes to override Trump’s vetoes.Four of Trump’s six vetoes have been on foreign policy measures. But now stronger vote margins -- near unanimous for two bills supporting the Hong Kong protesters -- make it harder for Trump to go against the will of Congress.“The president, at first, he was a little reluctant to sign it but then he did sign the Hong Kong bill and it was a big victory,” McCaul said.This will be an important consideration for Trump as the House moves forward on impeachment and the process goes to the Senate to decide whether he should be removed from office. Democrats in the House plan to unveil two articles of impeachment on Tuesday, according to people familiar with the matter.It’s extremely unlikely that enough Republicans in the Senate would turn on Trump to reach the two-thirds majority necessary to remove him from office.Yet that won’t stop them from working with Democrats to rein in his impulsive -- and in some cases they would say inadvisable -- actions involving international relations.“The margins have been going up because we’ve been working together,” said Representative Eliot Engel, a New York Democrat and the chairman of the House Foreign Affairs Committee. When it comes to foreign policy, he said, “we almost have a supermajority.”(Updates to add White House statement on NDAA in the 19th paragraph. An earlier version corrected the month of House vote on Turkey sanctions in the 21st paragraph.)To contact the reporter on this story: Daniel Flatley in Washington at dflatley1@bloomberg.netTo contact the editors responsible for this story: Joe Sobczyk at jsobczyk@bloomberg.net, Anna Edgerton, John HarneyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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Kudlow Says No Decision on Brazil, Argentina Steel Tariffs
(Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.Donald Trump’s top economic adviser said Tuesday the administration hasn’t made a decision about re-imposing steel tariffs on Brazil and Argentina, even though the president said last week the duties were “effective immediately.”Reinstating such tariffs has been discussed but there’s no decision yet, Larry Kudlow, the director of the White House’s National Economic Council, said at the Wall Street Journal’s CEO Council in Washington.The Brazilian government has yet to be notified by the U.S. about the intention to impose more duties on the country’s steel, according to a person with direct knowledge of the matter. Brazil plans to wait until it has official communication from the U.S. to make any decisions, the person said, asking not to be identified because discussions aren’t public.Trump said Dec. 2 that the U.S. would restore the duties to punish the two Latin American countries for “a massive devaluation of their currencies” that he said had hurt U.S. farmers. The White House didn’t comment Tuesday on whether documents to re-impose tariffs have been drafted.Read More: Here’s What Trump Overlooks on Brazil and Argentina CurrenciesTrump’s action amount to retaliation against two nations that have become alternative suppliers of soybeans and other agricultural products to China, grabbing market share away from the U.S. Rural voters, including farmers, are a key constituency for Trump as he heads into the 2020 presidential elections.While the steel tariffs could crimp trade, the Latin American countries gain much more shipping crops to Chinese buyers. In the first 10 months of the year, Brazil has shipped $25.5 billion in farm products including soybeans and pork to China. That’s more than 10 times the value of steel and iron products sold to the U.S.(Adds details on Brazil in third paragraph.)\--With assistance from Jordan Fabian.To contact the reporters on this story: Saleha Mohsin in Washington at smohsin2@bloomberg.net;Rachel Gamarski in in Brasilia at rgamarski@bloomberg.netTo contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, ;Daniel Cancel at dcancel@bloomberg.net, Ana Monteiro, Walter BrandimarteFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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Mass French Strikes Over Pension Reform to Disrupt Nationwide Transport
(Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.President Emmanuel Macron’s plan to overhaul France’s pension system was tested by a second day of labor protests across the country and the continued partial-paralysis of the Paris public transit system.Participation in the street marches fell on Tuesday by more than half to 339,000, according to Interior Ministry figures, compared with more than 800,000 last Thursday in what was the biggest turnout in a protest against Macron since he took office in May 2017.French Prime Minister Edouard Philippe is due to lay out on Wednesday the government’s proposals for the reform, which he called on Twitter a “plan for a simpler, fairer retirement for everyone.”The CGT union, which estimated Tuesday’s turnout at 1 million compared with 1.5 million on Dec. 5, called for two more days of marches on Thursday and Dec. 17 in an effort to get Macron to back down.Public sector disruptions continued as a strike by transport workers entered its sixth day, shutting down the majority of metro lines in Paris and preventing around four-fifths of trains from running nationwide. Around three-quarters of trains are expected to be canceled on Wednesday.Reforming France’s pension system has proven a treacherous task for former French leaders. In 1995, then Prime Minister Alain Juppe abandoned his plans after strikes paralyzed the country for about a month.Philippe, who worked on Juppe’s failed run for president in 2017, says the government will not budge this time.“If we do not make a profound, serious, progressive reform today, then someone else will make a truly brutal one tomorrow,” he said in an interview with the Journal du Dimanche newspaper on Sunday.But unions are refusing to blink. In the same newspaper, Philippe Martinez said the leftist CGT union he leads will continue striking until the government withdraws the reform.“In 1995, at the start of the protests, Juppe said he would never withdraw his plan. Things change fast and there’s a lot of anger,” Martinez said.According to a survey by Ifop Dec. 6 and Dec. 7, 53% of French people support or have sympathy for the protesters. An Ifop poll published on Tuesday based on a survey of 1,001 adults carried out after the first day of marches last week showed Macron’s approval rating slipped by a point for the third consecutive month to 35%.Limited ImpactThe Paris police ordered shopkeepers along the route of Tuesday’s march to shutter and protect their stores from potential looting. French civil-aviation authority DGAC asked airlines to reduce their schedules by 20%, and Air France said it would cancel 25% of its domestic flights.Before Tuesday, the protests had had limited economic impact, according to the government. While tourist cancellations are a concern, shops around the country had a good weekend of sales, Junior Economy Minister Agnes Pannier-Runacher said on French TV channel CNews on Monday.“One day of strikes doesn’t tip retailers into a difficult situation,” she said. “If it goes on, making it hard for customers to get to shops, it could bring down revenues.”Macron’s pension overhaul aims to create a universal points-based system to replace France’s 42 different pension regimes for different classes of workers. The 41-year-old president argues France’s current system is unfair and inapt for the 21st-century economy, in which workers change sectors during their careers.In an effort to find common ground, ministers met with unions for a last round of talks on Monday. The government says it wants to make the transition to a new system gradual and fair, without delaying it for decades.“I’m sure we will find the right point of balance that will reassure workers about their future, without giving up on our determination to push the country toward the future by putting in place a universal system,” Philippe said last week after the first round of marches.(Updates with estimates for participation in Tuesday demonstrations, prime minister comment)To contact the reporters on this story: William Horobin in Paris at whorobin@bloomberg.net;James Regan in Paris at jregan65@bloomberg.netTo contact the editors responsible for this story: Geraldine Amiel at gamiel@bloomberg.net, Tara PatelFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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Apple’s New Mac Pro Can Cost $52,000. That’s Without the $400 Wheels
(Bloomberg) -- Apple Inc. started selling its new Mac Pro desktop computer on Tuesday, complete with eye-watering pricing options that can push the cost north of $50,000.The new machine, built in Austin, Texas after Apple got tariff relief from the Trump administration, starts at $5,999 for specifications that some programmers, video editors, and photographers might consider measly. Fully loaded, the computer costs more than $52,000, and that’s excluding the optional $400 wheels for easily moving the machine around an office.For some professional users, the cost of Apple’s new computer is just part of doing business. But for most consumers, the Mac Pro’s price is shocking. As one of the most expensive personal computers in the world, some Apple users quickly compared the cost to a car.The base product includes 256 gigabytes of storage, low for professional computers in the same price range. A 4 terabyte option is an extra $1,400. An 8 terabyte upgrade is coming later, according to Apple’s website, but pricing hasn’t been announced.To increase the computer’s RAM memory from 32 gigabytes to 1.5 terabytes is $25,000 extra, the main reason the price can exceed $52,000. Apple said a version of the Mac Pro designed to be racked in data centers costs an extra $500 and will launch later. The Mac Pro does not include a display. Apple put a new Pro Display XDR on sale Tuesday for $4,999.The Mac Pro’s pricing first came into focus in June when the company announced the product and said that a stand to hold the new monitor would cost an extra $999.The company also said on Tuesday that it is doubling the cash-back offer for the Apple Card on Apple hardware purchases to 6% until the end of the year. That could make such purchases just a little easier.To contact the reporter on this story: Mark Gurman in Los Angeles at mgurman1@bloomberg.netTo contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net, Alistair Barr, Andrew PollackFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
