Green Bubble Burst: US ESG Fund Closures In 2023 Surpass Total Of Previous Three Years For years, green and socially responsible investments, aka ESG (Environmental, Social, and Governance), have dominated the investing world. However, according to Bloomberg, a seismic shift is underway as BlackRock and other money managers unwound an increasing number of 'green' products amid soaring backlash and investor scrutiny.  Data from Morningstar shows State Street, Columbia Threadneedle Investments, Janus Henderson Group, and Hartford Funds Management Group have unwound more than two dozen ESG funds this year. The latest unwind comes from BlackRock, who told regulators last Friday it plans to close two ESG emerging-market bond funds with total assets of $55 million.  Source: Bloomberg So far this year, the number of ESG funds closing is more than the last three years combined. This trend comes as investors pull money out of these funds as the ESG bubble has likely popped.  We asked this question in early summer: Is The ESG Investing Boom Already Over? In January, BlackRock's Larry Fink told Bloomberg TV at the World Economic Forum in Davos that ESG investing has been tarnished:  "Let's be clear, the narrative is ugly, the narrative is creating this huge polarization. " Fink continued: "We are trying to address the misconceptions. It's hard because it's not business any more, they're doing it in a personal way. And for the first time in my professional career, attacks are now personal. They're trying to demonize the issues." By June, Fink's BlackRock dropped the term "ESG" following billions of dollars pulled out of its funds by Republican governors, most notably, $2 billion by Florida Gov. Ron DeSantis. The crux of the issue that Republican lawmakers have with radical ESG funds is that they were trying to impose 'green' initiatives on the corporate level to force change in society, and many of these initiatives would be widely unpopular at the ballot box during elections.  Remember these comments from Fink? Alyssa Stankiewicz, associate director for sustainability research at Morningstar, told Bloomberg, "We have definitely seen demand drop off in 2022 and 2023."  Also, let's not forget about the 'greenwashing' across ESG industry.  Matt Lawton, T. Rowe Price Group Inc.'s sector portfolio manager in the Fixed Income Division, recently concluded: "It's becoming increasingly difficult to find credible sustainability-linked bonds."  The tide is reversing for Fink: "Backfire: World's Fourth Largest Iron Ore Producer Stops Purchasing Carbon Offsets." Don't forget this: "McDonald's Scrubs Mentions Of "ESG" From Its Website." Oops, Mr. Fink.  Tyler Durden Fri, 09/22/2023 - 06:55.....»»

Teamsters Want Senate Investigation Into Yellow's Bankruptcy By Todd Maiden of FreightWaves The Teamsters union called on the U.S. Senate this week to investigate Yellow’s bankruptcy as part of a broader investigation the lawmaking body’s judiciary committee is conducting on “corporate manipulation of Chapter 11 bankruptcy.” Chapter 11 filings are more and more being used as a path to liquidate assets instead of attempting to restructure operations and outstanding obligations. “Yellow is trying to fast track liquidation,” said Fred Zuckerman, Teamsters general secretary-treasurer, in a statement. “We haven’t had bankruptcy reform in this country for nearly two decades. We need to take this opportunity to right the wrongs at Yellow and prevent them from happening again.” He said that more than 22,000 union employees are out of work even though they conceded to more than $5 billion in wages and benefits concessions over the past 14 years to keep Yellow in business. The statement also took issue with retention bonuses totaling $4.6 million, which the company paid ahead of its bankruptcy petition. The payments are not uncommon in bankruptcy proceedings and are used to retain key executives, who are often integral in helping to wind down an estate. “Yellow approved millions in executive bonuses in June at the same exact time that they were voluntarily choosing not to pay millions in worker health care and pension benefits, said Sean O’Brien, Teamsters general president. “Workers in this country need real protections against corporations who game the system. We need real reform now that puts workers first in this process.” As tensions between Yellow and the Teamsters grew and talks over a proposed change of operations broke down, the company said it would withhold benefits contribution payments totaling more than $50 million in efforts to preserve cash and keep its doors open. Facing a suspension of health benefits, the union issued a strike notice, which resulted in freight fleeing the carrier’s network. Yellow eventually ceased operations on July 30, filing for bankruptcy one week later. The Teamsters statement said “expedited liquidation would preclude a potential purchase of Yellow’s assets from any party that may want to re-establish operations.” However, virtually all of the company’s customers had pulled their shipments by late July, with most employees being dismissed around that time. The few employees remaining currently are helping customers retrieve freight from the network and preparing assets for auction. On Friday, a Delaware bankruptcy court judge approved some key orders, including bidding procedures for the asset sales and a debtor-in-possession financing package to fund the unwinding of the estate. Private less-than-truckload carrier Estes Express Lines has placed the leading bid for Yellow’s portfolio of 174 terminals. It entered a $1.525 billion stalking horse bid that beat out a previous offer from LTL carrier Old Dominion Freight Line. The winner of the stalking horse bid, which sets the price floor for the assets to be sold, is expected to be announced Friday. The rolling stock that Yellow owns, which includes approximately 12,000 tractors and 35,000 trailers, could hit the auction block next month. Tyler Durden Fri, 09/22/2023 - 07:20.....»»

With Most Central Banks Ending Their Tightening Cycle, The BOJ Remains Too Terrified To Even Start With a growing number of central banks either ending their hiking cycle (BOE, SNB, Riksbank, and absent an oil price shock, the Fed too), or even actively easing (PBOC, Brazil), Japan remains the glaring monetary policy outlier it has been for the past 30 years, and despite soaring inflation that has been above the 2% inflation target since April 2022 (and even above US CPI at times) overnight the BOJ once again refused to even begin its long overdue policy tightening, when despite growing speculation that the central bank will at least set the groundwork for an end to YCC if not NIRP to tame the imploding Japanese lira yen, the BOJ voted unanimously to maintain its current policy as expected, with its 10-year JGB yield target at about 0%, the policy balance rate at -0.1% and kept yield curve control unchanged. And in a slap to the face of those expecting the central bank to at least hint that it is catastrophically behind the curve when it comes to controlling inflation, It also left its forward guidance unchanged, and noted “extremely high uncertainties” over prices and the economy and forecast inflation to decelerate. The BOJ also made no changes to its assessment of the economy and prices, which were revised upward in the previous Outlook Report. Specifically, its statement maintained the view that "Japan's economy has recovered moderately." In terms of individual items, it again stated that "consumption has increased steadily at a moderate pace," and that business fixed investment has also "increased moderately." On the inflation front, it adjusted its assessment of core CPI inflation, which has started to slow recently, to “has been at around 3 percent recently,” from “has been in the range of 3.0-3.5 percent.” Its view on inflation expectations was unchanged, as “have shown some upward movements again.” The BOJ also made no revisions to its view on risk factors, reiterating that "it is necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan's economic activity and prices." During his press conference following the policy announcement, governor Ueda, asked about his recent comments alluding to the possibility of confirming a virtuous inflation trend by year-end, a condition for policy normalization — clarified that the “distance to ending negative rates” hasn’t really changed. He explained he had simply wanted to avoid ruling anything out and limiting the BOJ’s options. Ueda also reiterated that when the goal of sustained 2% inflation is in sight, the BOJ will consider ending its YCC policy as well as raising interest rates. He reiterated that inflation should slow more clearly in coming months, although the recent deceleration was less than previously expected. Kuroda's successor said that the BOJ has long placed a greater emphasis on the risk of tightening too soon over the possibility of being behind the curve in raising rates. He says there’s no change to this “risk management” tendency. Speaking of the currency, Ueda said it’s desirable for currency rates to reflect economic fundamentals and for them to move in a stable fashion, although he declined to comment on "short-term" currency moves, which have seen the yen plunge as the worst performing major this year. Of course, the yen - which has been the Developed World's Turkish lira this year as it has cratered from 130 to 148, weakened even more on what was widely seen as a dovish BOJ stance, sliding 0.5% to about 148.3 per dollar. The drop may have been restrained by comments from government officials that they are ready to act on sharp moves. And indeed, while some were expecting the USDJPY to immediately spike above 150 after anything except a hawkish BOJ statement - with rate differentials to the US entering nosebleed territory - the contained drop may have been explained by what National Australia Bank noted was a warning that the BOJ is ready to intervene in the FX markets on the Ministry of Finance’s behalf at a moment's notice. "There is an addition of a paragraph in the BOJ statement that was not there in July, which concludes ‘it is necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan’s economic activity and prices’," says Ray Attrill, strategist in Sydney. “Intervention is of course MOF’s not BOJ’s call, but BOJ will evidently be fully onside with this should MOF so choose” Attrill said adding that “taken together with Mr Suzuki’s comments earlier, I think its pretty clear we should expect a burst of FX intervention one side or other of 150.” “As such, risk-reward doesn’t favor being long USD/JPY at current levels”, although with the USDJPY fast approaching 150, it appears that many disagreed. Ultimately, the question of when the BOJ intervenes will be a political one: there is only so much inflation Japan's long-suffering population can sustain, and at some point - quite soon - they will make it very clear that they will demand a different PM if the current one is willing to risk currency collapse just to preserve fake bond market stability for a few months longer. Stocks were also down, however, despite the sliding yen with the Topix closing 0.3% lower and the Nikkei 225 posting a 0.5% decline. JGBs rose, with 10-year futures up 16 ticks to 145.46. Cash bonds were mostly flat, with the 10-year yield holding at 0.745%, the highest since 2013. Tyler Durden Fri, 09/22/2023 - 07:39.....»»

Futures Rebound After Three Day Rout As Rates Ease From 2007 High US equity futures rebounded from a furious three-day selloff at the end of a bruising week for investors which sent markets to the lowest level in over a month as investors are forced to accept the idea of higher-for-longer interest rates (at least until the Fed once again breaks something, which it will). As of 7:45am ET, S&P 500 added 0.3%, a modest rebound after the index fell the most since March on Thursday; the tech-heavy Nasdaq 100 climbed 0.5%.European stocks pared their losses while Asian markets closed week well in the green, except for Japan where not even continued BOJ dovishness and a collapsing yen is enough to support risk. Treasury yields retreated across the curve, after 10-year rates briefly climbed above 4.5% in early trading in Asia. The Bloomberg Dollar Spot Index was little changed, with the Japanese yen and British pound leading declines among Group-of-10 currencies. Brent crude climbed 0.5% to $93.80 after a three-day drop. Gold and Bitcoin rose. In premarket trading, megacap tech stocks rose, set to rebound slightly after Thursday’s losses as US 10-year yields dipped slightly from highest since 2007. Apple, Amazon.com, Alphabet, Meta Platforms, Tesla, Nvidia were all in the green. Activision Blizzard gained 1.8% as Microsoft’s $69 billion acquisition of the gaming company looked set to clear its final regulatory hurdle. Here are some other notable premarket movers: Alibaba Group and other US-listed Chinese stocks are rallying, a day after the Nasdaq Golden Dragon China Index fell to the lowest level since July. BABA is up 3.9%. Coeur Mining is up 5.2% after RBC upgrades to outperform from sector perform. Ralph Lauren shares are up 1.2%, after Raymond James started coverage on the apparel company with an outperform rating and $135 price target, writing that “expectations are relatively low for RL,” while the “below-average valuation creates an attractive entry point.” Roku shares are up 1.4% in premarket trading, after CFRA upgraded the streaming-video platform company to hold from sell. Scholastic shares fall 18% in US premarket trading after the children’s publishing company reported a larger-than-expected adjusted loss per share for the first quarter as the company spent on other areas of its business for growth, and flagged the seasonality of sales in its Education Solutions unit. Sales also declined. Wayfair gains 2.4% in premarket trading after Bernstein raises the online home-furnishings retailer to market perform from underperform, citing improving revenue growth and management’s positive messaging on margins. Global central banks this week stressed that they remain vigilant about the risks of inflation and warned investors against premature expectations of rate cuts. The increasing possibility that monetary policy will lead to recession is prompting investors to dump stocks at the fastest pace since December, BofA's Michael Hartnett said, who noted that equity funds had outflows of $16.9 billion in the week through Sept. 20. Hartnett warned that persistently high rates could lead to a hard economic landing in 2024, and result in “pops and busts” in financial markets. “What matters more than Fed hikes themselves is whether a recession occurs or not,” said Wolf von Rotberg, an equity strategist at Bank J Safra Sarasin Ltd. “It would be a remarkable accomplishment if it were avoided, yet that seems unlikely. If a recession were to happen, the equity market is not prepared for it.” The latest evidence of resilience in the US labor market reinforced the case for the Fed’s stance of holding interest rates higher for longer. Applications for US unemployment benefits fell to the lowest level since January last week, figures out Thursday showed. “The prospect of interest rates staying higher for longer has given investors a lingering headache and sentiment has worsened as the week progressed,” said Russ Mould, investment director at AJ Bell. “Many investors had hoped we would approach the end of 2023 with a clearer picture on when interest rates will start to be cut. That scenario has now been muddied by comments from the Fed that it is prepared to raise rates further if necessary and keep a restrictive policy until there are clear signs that inflation is moving back to target levels.” Always an outlier, amid a hawkish barrage of central bank announcements, overnight the yen weakened after the Bank of Japan held interest rates, its 10-year yield target and forward guidance unchanged. The central bank reiterated its expectation that inflation is decelerating. European stocks were lower, with the Stoxx 600 down 0.2% and almost all sectors in the red. Construction, retail and real estate are the worst performers.  In individual moves in Europe, Adevinta ASA soared after the classifieds company said it received a takeover proposal from private equity investors including Blackstone Inc. and Permira. Meanwhile there were fresh signs of frailty in the euro-area economy Friday as figures showed private-sector activity in France and Germany continued to shrink in September. Here are the most notable European movers: Adevinta shares surge as much as 24% after the European classifieds company confirms it received a takeover offer from Permira and Blackstone, with analysts saying any deal is likely to be at a price well above where the stock is trading. The move also lifts peers including Rightmove and Auto Trader. Ascential shares jump as much as 12%, most since Jan. 25, after earnings that showed a strong performance in the UK firm’s events business, according to Citigroup. Ubisoft shares gain as much as 4.2% on Friday after the UK’s antitrust regulator said a revised proposal from Microsoft to sell some gaming rights to the French video-game maker opens the door for its Activision acquisition to be cleared. BioGaia shares rise as much as 8.6%, the most since April, after Handelsbanken raised its recommendation for the Swedish probiotics firm to buy, saying share price now reflects warranted concerns over customer demand and tough comparables in its 3Q report. Jungheinrich shares gain as much as 3.2% after Barclays initiated coverage of the warehouse machinery company with an ‘overweight’ rating, citing an attractive valuation. Dutch lenders ABN Amro -4.3% and ING Groep -5.2% slide after the parliament’s lower house approved a proposal to increase bank tax to support lower-income households. Alten shares fall as much as 7.8%, the most since January, after the engineering and technology consulting firm reported a bigger-than-expected drop in profitability due to lower activity levels and higher operating expenses. Var Energi shares drop as much as 7.6% as the co’s offering of 157.3m shares by holder prices via Barclays Bank Ireland, DNB Bank, Morgan Stanley & Co. International, SpareBank 1 Markets. Italgas shares decline as much as 2.8%, touching its lowest level since late October, after a placement of about 14.5m shares offered on behalf of buyers of exchangeable bonds who wish to sell shares to hedge market risk, according to terms of the deal seen by Bloomberg. Solutions 30 shares drop as much as 21% after the French technology-services company reported a wider first-half loss and a narrower profit margin. Earlier in the session, Asian stock retraced early declines and closed in the green. Chinese shares rallied, a move that likely reflects “short covering on expectations of more policy support measures over the weekend, just like the government’s moves in every weekend this month,” said Steven Leung, an executive director at Uob Kay Hian Hong Kong Limited. Hang Seng and Shanghai Comp shrugged off early jitters amid supportive measures including Beijing’s draft rules to promote a high level of opening up and encourage foreign investments, while China's market regulator also issued measures to promote the private economy. Japan's Nikkei 225 was pressured following the mostly firmer-than-expected Japanese CPI data but then pared some of the losses following the lack of hawkish surprises from the BoJ. Australia's ASX 200 was dragged lower with real estate and tech among the worst performers after the Australian 10yr yield touched its highest level since 2014, while the flash PMI data was mixed and showed a deeper contraction in manufacturing. In FX, the Japanese yen and British pound are rooted to the bottom of the G-10 rankings today. The yen added to its post-BOJ fall as Governor Ueda tempered expectations they were close to raising interest rates - USD/JPY rises 0.4% to trade near 148.20. Sterling slipped 0.4% after UK retail sales and composite PMI both fell short of estimates. The Bloomberg Dollar Spot Index rises 0.1%. EURUSD dropped 0.4% to 1.0615, lowest since March 17, after French manufacturing and services PMIs came in below estimates; currency pared losses after German PMI data came stronger-than-expected In rates, 10-year yields fall 2bps to 4.47% after touching a new cycle high above 4.5% for the first time since 2007 during Asian trading hours. The US session includes the first Fed speakers since Wednesday’s policy decision. Yields are lower by 1bp-2bp with curve spreads little changed on the day; in 10-year sector bunds trade cheaper by ~2.5bp vs Treasuries while gilts keep pace. Futures block trade of 5-year contracts at 6:35am New York time appeared consistent with a seller. Dollar IG issuance slate empty so far and expected to be muted; weekly volume stands at around $16b, in line with estimates for $15b to $20b. US economic data slate includes September S&P manufacturing and services PMIs at 9:45am. In commodities, oil rose, in part supported by news that Russia would ban exports of diesel-type fuel and gasoline; crude futures advanced, with WTI rising 1% to trade near $90.50. European natural gas prices fell as Chevron and labor unions in Australia agreed to end strikes at major export plants that roiled the market for more than a month. Spot gold adds 0.3%. At 8:50 a.m., Federal Reserve Governor Lisa Cook will give a keynote address at a National Bureau of Economic Research event. At 9:45 a.m., we’ll get the latest reading on S&P Global’s manufacturing and services gauges. San Francisco Fed Mary Daly will speak in a fireside chat at 1 p.m., and Minneapolis Fed President Neel Kashkari will appear in a separate event at the same time. Market Snapshot S&P 500 futures up 0.2% to 4,378.75 STOXX Europe 600 down 0.3% to 453.29 Nikkei down 0.5% to 32,402.41 Topix down 0.3% to 2,376.27 Hang Seng Index up 2.3% to 18,057.45 Shanghai Composite up 1.5% to 3,132.43 Sensex down 0.1% to 66,136.23 Australia S&P/ASX 200 little changed at 7,068.84 Kospi down 0.3% to 2,508.13 German 10Y yield little changed at 2.72% Euro down 0.2% to $1.0642 Brent Futures up 0.4% to $93.64/bbl Gold spot up 0.3% to $1,926.57 U.S. Dollar Index up 0.23% to 105.60 MXAP up 0.3% to 159.89 MXAPJ up 0.9% to 496.80 Top Overnight News The BOJ left its monetary policy unchanged, capping a week of central bank decisions that have roiled financial markets. Kazuo Ueda said the distance toward ending the YCC program and negative rate regime hasn't changed much. Market watchers expect the yen to drop toward 150 per dollar, with intervention possible as it nears that level. BBG China is considering relaxing foreign ownership caps in listed local companies to lure global funds back to its stock market, people familiar said. The country currently caps it at 30%, and subjects a single foreign shareholder to a 10% limit. BBG JPM will include Indian gov’t bonds in its emerging market index, a move that could trigger billions of inflows to the market. Nikkei Euro-area private sector activity shrank for the fourth consecutive month, suggesting the economy contracted in the current quarter. The composite PMI hit 47.1 in September, an improvement on August but still in contraction. While Germany's downturn eased, it deepened in France. UK figures showed the sharpest decline since January 2021. BBG European gas prices dropped after Chevron and labor unions resolved a dispute at key LNG facilities in Australia that began Sept. 8th. The agreement brings an end to strikes at the Gorgon and Wheatstone plants, which accounted for about 7% of the world's LNG supply last year. BBG Euro zone companies are finally absorbing wage pressures and the labor market has started to soften, European Central Bank chief economist Philip Lane said on Thursday, suggesting inflation pressures from employee pay rises are finally subsiding. RTRS AAPL cools the pace of compensation increases for retail employees, the latest sign of the labor market easing. BBG Hollywood studios will continue negotiations w/the WGA on Friday amid hopes for a breakthrough that settles the strike relatively soon. WaPo AMZN confirmed recent media reports with a plan to begin running advertisements inside its Prime Video content. The company will sell an ad-free upgrade option for Prime members who pay an additional $2.99/month (given that Prime cost $14.99 per month, this is effectively a ~20% price hike in the US for people who want to keep ads out of their content). WSJ A more detailed look at global markets courtesy of Newsquawk APAC stocks traded mixed amid a higher yield environment and after this week’s central bank frenzy culminated with a lack of surprises from the BoJ. ASX 200 was dragged lower with real estate and tech among the worst performers after the Australian 10yr yield touched its highest level since 2014, while the flash PMI data was mixed and showed a deeper contraction in manufacturing. Nikkei 225 was pressured following the mostly firmer-than-expected Japanese CPI data but then pared some of the losses following the lack of hawkish surprises from the BoJ. Hang Seng and Shanghai Comp shrugged off early jitters amid supportive measures including Beijing’s draft rules to  promote a high level of opening up and encourage foreign investments, while China's market regulator also issued measures to promote the private economy. Top Asian News China mulls easing foreign stake limits to lure global funds, via Bloomberg. PBoC releases list for systemic important banks; will promote stable operations and healthy development of systemically important banks, according to Reuters. Chinese Vice President Han Zheng said China remains committed to opening itself up to the wider world and to an independent foreign policy, while it stays committed to safeguarding sovereignty and territorial integrity, according to Reuters. China's market regulator issued measures to promote the private economy and China will continue to break down market access barriers for the private economy, according to state media. Japanese PM Kishida said he will reform the asset management sector and will introduce a new programme to assist new entrants to the asset management sector. Furthermore, Kishida said it is important for FX to move stably, reflecting economic fundamentals. European bourses are mostly lower, but have trimmed the losses seen at the cash open. The main macro story for the region thus far has been the flash PMI prints for September. Sectors in Europe are mostly lower with the exception of Basic Resources which is in marginally positive territory thanks to underlying metals prices. On the downside, the Construction & Materials sector lags. US futures are trading slightly firmer following the biggest US stock drop since March, in yesterday's session. Top European News UK Recession Risk Grows as Companies Cut Staff at a Sharp Pace Dutch Lenders Slide After Parliament Approves Bank Tax Increase European Stocks Slide on Interest Rate Woes; Dutch Banks Slide Dutch Lenders Slide as Parliament Approves Share Buyback Tax Grim Euro-Area Private Sector Suggests Quarterly Contraction Alten Falls as Profit Dragged by Expenses, Lower Activity Level Vodafone in Negotiations to Sell Spanish Business to Zegona FX DXY is on a firmer footing following the uneventful BoJ decision overnight coupled with weakness from the EUR post-PMI. EUR and GBP both declined following overall downbeat PMI data in which the overarching theme was growth concerns. USD/JPY hit a high of 148.42 after the BoJ announcement overnight which offered no hawkish surprises whilst Governor Ueda repeated that the central bank will not hesitate to take additional easing measures if necessary. Antipodeans outperform in tandem with optimism surrounding China which has also propped up commodities. PBoC set USD/CNY mid-point at 7.1729 vs exp. 7.3009 (prev. 7.1730) Fixed Income Debt futures faded from post-French PMI peaks and never really threatened best levels again. Bunds returned to flat on the day within a 130.19-129.50 range and OATs recently dipped below par between 124.87-124.21 parameters, while Gilts are holding above 96.00 having reached 96.37 from their 95.65 early Liffe low. T-note is closer to 108-19+ overnight high than 108-09 base awaiting the fate of preliminary US PMIs and Fed rhetoric from Daly, Cook and Kashkari with an element of pre-weekend short covering probably in mind. Commodities WTI and Brent November futures are choppy in the European morning, with the complex swayed by mixed flash PMI data from France and Germany, with price action within yesterday’s range but underpinned by Russia’s gasoline and diesel export ban which came into effect yesterday. Dutch TTF is on a firmer footing despite Chevron’s Australia LNG workers suspending industrial action after reaching a deal. The upside for the complex could emanate from the Russian gasoline/diesel export ban, whilst recent reports also suggested firmer Chinese LNG demand. Metals are resilient to the firmer Dollar with spot gold rising from a 1,919.12/oz low, above its 200 DMA (1,925.29/oz) to a high just shy of its 50 DMA (1,929.58/oz). Base metals meanwhile have rebounded and trimmed a bulk of yesterday’s losses, with some citing optimism of a Chinese economic rebound amid recent stimulus measures, with desks also pointing to restocking ahead of China’s 8-day long holiday commencing next Friday. Australian unions agreed to endorse recommendations made by the industrial umpire to end the dispute with Chevron (CVX) and agreed to call off strikes at Chevron facilities. Chevron (CVX) Australia spokesperson says unions have advised the Co. and the Fair Work Commission that industrial action has been suspended. Russian Kremlin said the fuel export ban will last for as long as necessary to ensure stability of the fuel market, according to Reuters. Russia's Kremlin said there has been no progress on the Black Sea grain deal issue, with no talks between the Russian and Turkish presidents scheduled, according to Reuters. Geopolitics Belarus Defence Ministry announces that Belarus and Russia are to commence joint military drills, according to Reuters. US President Biden said in a meeting with Ukrainian President Zelensky that Russia alone stands in the way of peace and Russia is seeking more weapons from Iran and North Korea, while he added that Russia hopes to use winter as a weapon against the Ukrainian people. Biden announced USD 325mln of security aid for Ukraine and that the first US Abrams tanks would be delivered to Ukraine next week. Ukrainian President Zelensky said that they reached an agreement to strengthen Ukraine's defence capabilities and that the US will help Ukraine boost air defence during the winter, while they agreed on steps to expand exports of grain from Ukraine, according to Reuters. Chinese Vice President Han Zheng said China supports all efforts that are conducive to the peaceful resolution of the Ukraine crisis and stands ready to continue playing a constructive role for an early attainment of peace, according to Reuters. US Event Calendar 09:45: Sept. S&P Global US Services PMI, est. 50.7, prior 50.5 09:45: Sept. S&P Global US Manufacturing PM, est. 48.2, prior 47.9 09:45: Sept. S&P Global US Composite PMI, est. 50.4, prior 50.2 Central Bank Speakers 08:50: Fed’s Cook Speaks at NBER AI Conference 13:00: Fed’s Daly to Discuss Monetary Policy, Economy 13:00: Fed’s Kashkari Speaks DB's Jim Reid concludes the overnight wrap Markets experienced another big sell-off yesterday, with longer-dated yields hitting new highs for the cycle across several countries. In fact, the US 10yr Treasury yield has surpassed the 4.5% mark in trading overnight, which is the first time that’s happened since 2007. And the moves haven’t just been confined to Treasuries, since Bloomberg’s global aggregate bond index closed at its lowest level of 2023 so far yesterday. Meanwhile for equities, the losses gathered pace towards the end of the session, and the S&P 500 (-1.64%) experienced its worst day since March. In large part, those moves have been driven by the prospect that central banks are likely to keep policy rates in restrictive territory for longer than previously thought. That was prompted initially by the Fed’s hawkish dot plot on Wednesday. But the sell-off then got fresh momentum yesterday from theUS weekly jobless claims, which came in at their lowest since January at 201k. That pushed the 4-week moving average to its lowest level since March, offering further evidence that this strength doesn’t just look like a blip. That backdrop led to an intense bond sell-off, since the strong labour market data suggested that any rate cuts were still some way off. By the close yesterday, the 10yr Treasury yield (+8.7bps) was at a post-2007 high of 4.494%, and it remains there overnight after coming down slightly from the 4.5% mark. At the same time, the 10yr real yield (+6.6bps) also hit a post-2009 high of 2.11%. Yesterday’s rise was even stronger at the long-end, with the 30yr yield seeing its sharpest rise since April, up +12.8bps to 4.57%. That said, front-end yields actually fell on the day, with the 2yr yield ending the day -3.1bps lower at 5.15%. As a result, the 2s10s slope saw its most significant steepening since the March banking stress (to -65.4bps), and overnight it’s steepened a bit further to -63.9bps. Over in Europe it was much the same story, with yields on 10yr bunds (+3.5bps) hitting their highest intraday level since 2011 at one point, although they then pared back those gains somewhat to close at 2.73%. This rise in nominal and real yields meant that equities continued to struggle, and the S&P 500 (-1.64%) seeing its worst day since March and closing at its lowest level in nearly 3 months. It also means that we’ve now had a 5% sell-off in the index since its recent peak at end-July, which is the first time since the SVB sell-off in March that we’ve experienced a decline of that magnitude. At the same time, the VIX index of volatility rose for a 5th consecutive day, up a further +2.4pts to 17.5pts, which is its highest level in a month. The NASDAQ saw an even sharper loss (-1.82%). Meanwhile, the small-cap Russell 2000 (-1.56%) is now in technical correction territory, having shed more than -10% since its peak in end-July. And over in Europe there were losses across the continent, with the STOXX 600 down -1.37%. Overnight in Asia, the main story is that the Bank of Japan has left policy unchanged at their latest meeting, in line with expectations. We’ll have to see what Governor Ueda says in the press conference, but so far the Japanese Yen has weakened -0.30% against the dollar overnight, since the ongoing stimulus has put further pressure on the Yen. Ahead of the decision, the latest CPI numbers for August were also stronger than expected, with headline CPI at +3.2% (vs. +3.0% expected). Following the decision, Japanese equities have pared back some of their earlier losses, but the Nikkei is still down -0.38%. But outside of Japan the picture has been more mixed, with losses for the KOSPI (-0.41%), but gains for the Hang Seng (+1.21%), the CSI 300 (+1.03%) and the Shanghai Comp (+0.77%). Looking forward, there’s also been a stabilisation in US equity futures, with those on the S&P 500 up +0.17% overnight . The other important news overnight has been from the September flash PMIs. In Japan, they’ve weakened relative to August, with the composite PMI down to 51.8, which is its lowest level since February. But in Australia, there’s been a recovery in the composite PMI, which has risen to a 3-month high of 50.2. So all eyes will be on the US and European numbers later to see the direction of travel as we come to the end of Q3. Elsewhere yesterday, t he Bank of England kept their policy rate on hold at 5.25%, which ended a run of 14 successive hikes. It was a narrow 5-4 vote among the committee, with 4 of the members preferring a 25bp hike, and their statement still signalled the potential for more hikes. For instance, it said that “Further tightening in monetary policy would be required if there were evidence of more persistent inflationary pressures.” The other important development came with regards to quantitative tightening, where they voted to reduce the gilt portfolio by £100bn over the year from October, taking the total down to £658bn . For markets, the decision to leave rates unchanged came as something of a surprise, since swaps had been pricing in a 63% likelihood of a hike immediately prior to the decision. As a result, sterling fell against both the US dollar (-0.37%) and the Euro (-0.39%). However, gilt yields followed a pattern similar to the rest of Europe, with a noticeable steepening amidst rises in both the 2yr (+2.5bps) and the 10yr yield (+9.0bps). Looking forward, our UK economist thinks it’s more likely than not that rates have peaked. See his full recap here. Central banks were in the spotlight elsewhere yesterday, with decisions in several other European countries. In Sweden, the Riksbank raised their policy rate to 4%, in line with expectations. Likewise in Norway, the Norges Bank hiked by 25bps to 4.25%, and Governor Bache said “There will likely be one additional policy rate hike, most probably in December”. However, in Switzerland, the SNB left rates unchanged at 1.75%, contrary to the consensus of economists who expected a 25bp hike. As a result, the Swiss Franc was the worst-performing G10 currency yesterday, weakening by -0.66% against the US Dollar . Looking at yesterday’s other data, US existing home sales fell to an annualised rate of 4.04m in August (vs. 4.10m expected), leaving them at a 7-month low. Meanwhile, the Conference Board’s Leading Index fell by -0.4%, marking its 17th consecutive monthly decline. To the day ahead now, and data highlights include the September flash PMIs from Europe and the US, along with UK retail sales for August. Central bank speakers include ECB Vice President de Guindos, along with the Fed’s Cook, Daly and Kashkari. Tyler Durden Fri, 09/22/2023 - 08:20.....»»

Chevron LNG Workers End Strike In Australia Authored by Irina Slav via OilPrice.com, The Offshore Alliance trade union has called off a strike at two Chevron LNG projects in Australia after the country’s labor market regulator mediated a settlement between the parties. The strike began on September 8 after they failed to reach an agreement with Chevron about working conditions and wage demands. "The Offshore Alliance will now work with Chevron to finalise the drafting of the agreement and members will soon cease current industrial action," the union said, as quoted by Reuters. Because of the dispute between Chevron and workers at the Gorgon and Wheatstone projects, LNG prices jumped 35% in August and remain highly volatile as autumn begins and importers step up buying for the winter heating season. The Gorgon project has a capacity of 15.6 million tons of liquefied natural gas annually, while the Wheatstone facility can produce 8.9 million tons annually. Together, the two account for over 5% of global LNG production capacity, hence the effect on gas prices. A third Australian LNG project was also under threat of industrial action in August but its operator, Woodside Energy, managed to negotiate a deal with the Offshore Alliance. The North West Shelf is the largest LNG production facility in the country, with a capacity of 16.9 million tons of liquefied gas annually. Even with the danger of supply disruptions now over, however, the LNG market remains volatile because of the surge in demand from Europe last year as it sought to replace Russian pipeline gas with alternative supplies. This year, it has been buying gas less frantically but it has filled its gas storage well ahead of schedule and might need to resort to floating storage to lock in more supply for the winter since the available storage does not cover all consumption. Meanwhile, however, China is stepping up its LNG buying ahead of winter, too, intensifying competition for limited supply. Tyler Durden Fri, 09/22/2023 - 08:35.....»»

Commercials Set To Invade Amazon Prime Video Unless You Pay New 'Ad Free' Fee  Amazon Prime announced Friday morning a new plan to start placing "limited advertisements" in TV shows and movies unless customers pay an extra monthly fee.  "To continue investing in compelling content and keep increasing that investment over a long period of time, starting in early 2024, Prime Video shows and movies will include limited advertisement," an Amazon press release read.  The e-commerce giant said its streaming platform would have "fewer ads than linear TV and other streaming TV providers," and ads in Prime Video will be introduced across the US, UK, Germany, and Canada in early 2024. Then, customers in France, Italy, Spain, Mexico, and Australia will see ads in the second half of the year.  Prime Video customers who want the luxury of no ads must pay a new ad-free option for an additional $2.99 per month. Current pricing in the US for Prime memberships is around $14.99 per month, or about $139 per year if paid annually.  The Verge noted, "The introduction of ads comes at a time when Amazon is undergoing cost-cutting across the company, and arrive as price increases and ad-supported tiers launch on competing streaming services."  Amazon already runs ads elsewhere: Its Freevee service, which doesn't require a subscription, allows users to watch movies and TV shows. However, viewers will be bombarded with ads in exchange for free content.  Minimal ad load on streaming platforms has been the norm since debuting a decade ago. The fear is that Prime and others will become too aggressive in monetization.  The days of streaming platforms charging bargain-basement prices in pursuit of fast growth are over.  Source: WSJWe noted last month that 'streamflation' has led to a revolt of Disney+ and Hulu customers as prices are set to hike next month.  Tyler Durden Fri, 09/22/2023 - 08:50.....»»

Quantitative Tightening Is Not Biggest Threat To Global Yields Authored by Simon White, Bloomberg macro strategist, The Bank of England’s quantitative tightening program shows that unwinding central-bank bond portfolios, even with outright sales, need not be disruptive for markets. The greater risk for US and global yields comes from positive stock-bond correlations driving risk premia wider. The BOE has been a pioneer and a thought leader in QT. While the Fed and ECB have only allowed bonds to run off naturally to help achieve their balance-sheet contraction goals, the BOE has sold gilts outright in addition to allowing bonds to mature. So far, it has not led to any significant market disruption. This enabled the BOE Thursday to increase the pace of reduction in the Asset Purchase Facility (APF) from £80 billion last year to £100 billion over the coming 12 months from October (while holding Bank Rate steady). As colleague Ven Ram also noted, the schedule of maturing bonds next year allowed the bank to keep gilts sales unchanged from last year while increasing the total amount of the APF’s decrease. The QT watchwords from the bank are “gradual and predictable.” If gilt sales are conducted in such a way, then market disruption should be minimized. The chart below shows the BOE’s own assessment of the impact of bond sales on the market. The BOE estimates that of the ~40 bps of term-premium increase since the MPC voted to begin QT in February 2022, about 10-15 bps comes from QT specifically – small in comparison to the overall rise in yields since that time. QT or bond sales, though, are not the most critical risk facing bond prices in the current cycle. Rising and now positive stock-bond correlations threaten to lead to a structural rise in bond risk premium, and lower prices. The correlation is now positive in the US, Japan, and the UK. In a positive stock-bond correlation world, bonds lose their portfolio-hedge and recession-hedge capabilities, and thus become less sought after. The penny has not fully dropped yet, but the negative term premium for bonds is increasing, and is prone to rising much higher as they become less desirable. Yields of developed market countries are biased structurally higher, but QT is unlikely to be the culprit. Instead, it allows central banks to reload their capacity for a future time when they may need to restart quantitative easing, in order to stabilize the market from sharply rising term premia. Tyler Durden Fri, 09/22/2023 - 09:10.....»»

Democrat Sen. Bob Menendez, Wife Indicted Over Gold Bar And Other Bribery Schemes Sen. Bob Menendez (D-NJ) and his wife Nadine have been indicted in New York for allegedly accepting bribes in relation to an allegedly corrupt relationship they had with three businessmen from their home state. The indictment also charges three businessmen, Wael Hana, Jose Uribe and Fred Daibes. "Those bribes included cash, gold, payments toward a home mortgage, compensation for a low-or-no-show job, a luxury vehicle, and other things of value," reads the indictment. Daibes, a developer and former bank chairman, allegedly gave Menendez gold bars valued at approximately $400,000, in exchange for assistance in a case in which he faced federal bank charges. Instead of facing over 10 years in prison, Daibes, a felon, only ended up serving probation after striking an agreement with the US Attorney's Office in New Jersey. "For purposes of the Federal Extortion Act, it makes no difference if the senator took an official act so long as he accepted the money and there was knowledge the money was in exchange for that official influence, even if he never carried out what he had promised he would do," according to NBC Legal Analyst Danny Cevallos. Menendez disclosed that his family had accepted gold bars in 2020. Daibes encountered bank fraud charges that could have netted him up to a decade in prison for lying about a nearly $2 million loan from Mariner's Bank, where Daibes served as chairman. Last year, however, New Jersey's U.S. Attorney's Office agreed to let Daibes plead guilty to one count and serve probation. They said Daibes had repaid the loan. -Fox News According to the report, Menendez, 69, is 'close' with US Attorney Philip Sellinger - having supported him for the position, while Sellinger had previously raised funds for Menendez's campaign. Bob Menendez and wife Nadine Officials are also looking at whether Menendez, the former Chairman of the powerful Senate Foreign Relations Committee, or his wife, had improperly received gifts from a New Jersey food processor who obtained an exclusive contract with the Egyptian government to certify halal food experts around the world. Egyptian officials and the New Jersey businessman who received the contract were hosted by Menendez in his office in 2018, according to the Wall Street Journal. A year later, the businessman became the "sole certifier of halal meat exported from the U.S. to Egypt," the outlet noted. NBC News 4 said the gifts included the usage of a Mercedes and a luxury Washington, D.C., apartment. Investigators are attempting to resolve if Menendez, chair of the Senate Foreign Relations Committee, used his standing to help the man secure the contract. -Fox News According to the indictment, Menendez provided 'sensitive US Government information to Egypt.' Indictment says this info wasn't classified, but was "highly sensitive." And it was shared very shortly after Menendez allegedly sought it. pic.twitter.com/GQPqXdLgYB — Aaron Blake (@AaronBlake) September 22, 2023 Menendez and his wife are charged with three counts: conspiracy to commit bribery, conspiracy to commit honest services fraud, and conspiracy to commit extortion under color of official right. In June of last year, federal agents searched Menendez's New Jersey home, where they found "fruits" of the pair's "corrupt bribery agreement" with the three businessman - including over $480,000 in cash, some of which was stuffed in envelopes, and $70,000 in Nadine Menendez's safe deposit box. They also found gold bars worth over $100,000, "provided by either Hana or Daibes." In the months before his office admitted he was under federal investigation, Menendez's wife sold up to $400,000 in gold bars between April 7, 2022 and June 16, 2022. A press event will be held today at 11:00 a.m. to announce the unsealing of an indictment charging Robert Menendez, U.S. Senator from New Jersey, and his wife, Nadine Menendez, with bribery offenses in connection with their corrupt relationship with three New Jersey businessmen. pic.twitter.com/CLTXnU0mAm — US Attorney SDNY (@SDNYnews) September 22, 2023 This is hardly the first time Menendez has been under federal criminal investigation. If we’ve learned anything from DOJ this year, it’s that if you’re going to take gold or diamonds from foreigners in exchange for official acts, your last name had better be Biden. — Sean Davis (@seanmdav) September 22, 2023 Tyler Durden Fri, 09/22/2023 - 09:30.....»»

Global Stagflation? US, EU PMIs Signal Slowing Growth, Rising Prices This morning started with a modest rise in Euro-area Composite PMI (+0.3 to 47.1) on the back of a pick up in Services. The increase in the area-wide index was driven by an improvement in Germany and the periphery, offset by a deceleration in France. In the UK, the composite flash PMI decreased by 1.9pt to 46.8, meaningfully below consensus expectations. Goldman saw three main takeaways from today's data. First, while marginally better than last month, Euro area growth momentum remains subdued across both sectors. Country press releases attributed this weakness to poor demand conditions, both domestically and abroad. Second, inflationary pressures continue to moderate, as reflected by the continued decline in output prices, but the recent pickup in input prices points to upside risk going forward. Third, growth momentum in the UK appears to be deteriorating at a faster-than-anticipated pace. This, in turn, is now being accompanied by a loosening in the labour market, and a cooling in underlying inflationary pressures In the US, however, the last few months have seen 'hard' (real) macro-economic data serially disappoint, while at the same time, 'soft' (survey-based) economic data has dramatically outperformed, sending 'hope' - the spread between 'hard' and 'soft' - to two year highs... Source: Bloomberg This morning's mixed PMI picture from Europe followed through into the US with Manufacturing PMI for September (preliminary) rising from 47.9 to 48.9 - the fifth straight month of contraction; while Services PMI disappointed, sliding from 50.5 to 50.2 - its lowest since January... Source: Bloomberg Commenting on the data, Siân Jones, Principal Economist at S&P Global Market Intelligence said: “PMI data for September added to concerns regarding the trajectory of demand conditions in the US economy following interest rate hikes and elevated inflation. Although the overall Output Index remained above the 50.0 mark, it was only fractionally so, with a broad stagnation in total activity signalled for the second month running. The service sector lost further momentum, with the contraction in new orders gaining speed. “Subdued demand did not translate into overall job losses in September as a greater ability to find and retain employees led to a quicker rise in employment growth. That said, the boost to hiring from rising candidate availability may not be sustained amid evidence of burgeoning spare capacity and dwindling backlogs which have previously supported workloads. “Inflationary pressures remained marked, as costs rose at a faster pace again. Higher fuel costs following recent increases in oil prices, alongside greater wage bills, pushed operating expenses up. Weak demand nonetheless placed a barrier to firms’ ability to pass on greater costs to clients, with prices charged inflation unchanged on the month.” So, slower growth, but rising prices - The Fed and ECB face their nemesis 'Stagflation' in the Sisyphean struggle against reality. Tyler Durden Fri, 09/22/2023 - 09:58.....»»

Zelensky Departs Washington Mostly Empty-Handed Amid Mood Shift In West By all accounts, Zelensky came away from his Washington visit with nothing new. Biden did announce a fresh $325 million aid package for Ukraine from already committed funds, but the hoped-for long range missile approval never came (however, more cluster bombs are being sent). And as we detailed Thursday, House Republican leadership once again failed to move forward on a mere procedural vote for the Pentagon funding bill, due in large part to GOP members rejecting Biden's proposed $24 billion more in Ukraine aid. Thursday's package announced by Biden, as Zelensky visited the White House and Capitol Hill, was run-of-the-mill and entirely to be expected. "Today I approved the next tranche of U.S. security assistance to Ukraine including more artillery, more ammunition, more anti-tank weapons and next week, the first U.S. Abrams tanks will be delivered to Ukraine," Biden said. As for the earlier in the day (Thurs.) meeting with Congressional leaders, House Speaker Kevin McCarthy explained when asked why the Ukrainian leader's request to address Congress was denied, "Zelensky asked for a joint session, we just didn't have time. He's already given a joint session." Via AFP Instead in a closed-door meeting, Zelensky later acknowledged he discussed with lawmakers "the battlefield situation and priority defense needs." But if there is any level of consolation for Kiev, it's seen in the Pentagon announcement which came late in the day Thursday. Facing potential US government shutdown on Oct.1st, given at this point Congress is not expected to pass the 12 appropriations bills needed to fund government operations before next fiscal year, the Pentagon has said it will exempt its operations supporting Ukraine from a shutdown.  The military typically suspends any activities not deemed vital to national security during government shutdowns, thus the DoD is in effect saying Ukraine aid remains "vital to national security".  "Operation Atlantic Resolve is an excepted activity under a government lapse in appropriations," Pentagon spokesman Chris Sherwood told Politico, in reference to the operational name still used for actions supporting Kiev. But Politico points out a potential shutdown would still negatively impact US support to Ukraine: Sherwood noted that while DOD’s activities related to Ukraine will continue, furloughs and other activities halted under the shutdown could still have a negative impact. "Training would happen, but depending on whether or not there were certain personnel that were not able to report for duty, for example, that could have an impact," said Pentagon spokesperson Brig. Gen. Patrick Ryder on Thursday. This Pentagon exemption to keep Ukraine-related support active during a government shutdown seems to be the only significant thing Zelensky came away with.  Zelensky visited the US in person, made a speech at the UN, and came home with an amount of ammo so small the Pentagon won't give numbers and a handful of the worst air defense systems currently in use by a major power. In the Army we called this "getting thrown under the bus." pic.twitter.com/f8hFVstDud — Armchair Warlord (@ArmchairW) September 22, 2023 It appears to have been the main object of discussion when Zelensky met with Secretary of Defense Lloyd Austin in Washington during the trip. The Pentagon said this was "to reaffirm the steadfast US support for Ukraine." Meanwhile, Bloomberg takes note of Zelensky "showing the strain" amid increasing divisions among allies: The Ukrainian president allowed a dispute with one of his biggest allies to spin out of control at the United Nations General Assembly this week, and that’s just a hint of the tensions building behind the scenes. Zelenskiy has been leading his country through Russia’s brutal assault for 19 months, all the time fighting on another front to wring the weapons and finance he needs from his US and European supporters. Now he suspects that President Joe Biden’s commitment is wavering and other leaders may be taking their cue from the US, according to a person who met with him recently. He grew very emotional at times during that discussion, the person said, and was scathing in his criticism of nations that he said weren’t delivering weapons quickly enough. Washington's lackluster greeting of Zelensky this week (compared to how he was received in December 2022) came simultaneous to Poland declaring it will no longer arm Ukraine, amid a fierce diplomatic spat over blockage of Ukraine grain imports by Warsaw, to protect Polish farmers. The Economist is also taking note of the significant mood shift among Western allies... A "long war" indeed... given a G7 leader from a European country has told reporters this week that the West is prepared for a years-long war, something likely to last some six or seven years, according to the quote. "A senior official from one European G-7 country said the war may last as much as six or seven more years and that allies need to plan financially to continue support for Kyiv for such a long conflict," Bloomberg wrote. Tyler Durden Fri, 09/22/2023 - 10:15.....»»

UAW Boss Says Ford "Serious About Reaching Deal"; Expands Strike To All GM & Stellantis Parts Distribution Centers Update (1021ET): United Auto Workers boss Shawn Fain said, "Today at noon Eastern time, all of the parts distribution facilities of GM and Stellantis are being called to stand up and strike." He said there will be strikes at 38 locations across 20 states.  *   *   * Update (1018ET): United Auto Workers boss Shawn Fain said, "Ford is serious about reaching a deal," but "It's a different story at GM and Stellantis."  *   *   * Update (1004ET): United Auto Workers boss Shawn Fain is set to speak with union members momentarily. Fain is expected to "announce progress at the bargaining table with Ford Motor Co., an indication the union may not expand its strike targeting the automaker," according to Bloomberg, citing sources.  As for the other automakers, Fain is expected to target six more General Motors and Stellantis plants (in Michigan).  *   *   * The head of United Auto Workers, Shawn Fain, warned General Motors Co., Ford Motor Co., and Stellantis NV earlier this week that strikes would expand on Friday - if offers for a new four-year labor contract were not increased to 'satisfying levels.'  Fast forward to Friday morning, UAW boss Fain is expected to address all 146,000 members via Facebook Live event around 1000 ET. He is expected to reveal the union's next steps in broadening strikes at automakers' manufacturing plants. "Either the Big Three get down to business and work with us to make progress in negotiations, or more locals will be called on to stand up and go out on strike," Fain said on Monday.  A Deutsche Bank note shows the automakers have offered around 20% pay hike increase over a new four-year labor contract. There have been no new offers by automakers this week. UAW pay hike demands are still around 36%, indicating a very large gap in talks.  Bloomberg noted, "An expanded strike could ratchet up pressure on the carmakers to reach a deal. Fain's strategy has been to keep the companies guessing about his next move. But more members walking on also poses a risk to the union in the form of a diminished strike fund."  Deutsche Bank shows the union's strike fund had $825 million at the start of the strike one week ago.  The pressure is on for automakers and the union to find common ground at the bargaining table. Morgan Stanley's auto strategist, Adam Jonas, revealed in a note to clients this week, "The value of N. American light production of the D3 (F, GM, STLA collectively) is approximately $750mm per day (approx. 15k units per day). Applying slightly more than a 30% decremental (yes, mix is that high) implies around $250mm of lost profit per day (assuming 100% of production impacted)." We've pointed out that automakers have already responded with layoffs of non-striking workers (see here & here).  The ball is in Fain's court today.  Tyler Durden Fri, 09/22/2023 - 10:25.....»»

In So Many Ways It Feels Like The Barbarians Are At The Gates By Benjamin Picton, Senior Macro Strategist at Rabobank How Often Do You Think About The Empire? There is big news today that ex-Australian media titan Rupert Murdoch is stepping down as Chairman of News Corp. He is to be succeeded by son Lachlan who, having served the longest apprenticeship since Prince Charles, will take over as sole Chair of News Corp and continue on as Executive Chair and CEO of Fox Corporation. The Murdoch family’s grip on the legacy media landscape lives rent-free in the heads of many, and speculation over the eventual passing of the baton has even spawned an Emmy award-winning TV series. So, how often do you think about the Empire? The question has become a light-hearted social media sensation, but in a world of geopolitical fragmentation, empires matter. Wannabe Tsar (a derivative of ‘Caesar’) Vladimir Putin raised eyebrows in June last year by comparing himself to Peter the Great. “It seems it has fallen to us, too, to reclaim and strengthen” he said. The process of “reclamation” continues as the war in Ukraine grinds on, and Putin fired a new shot at the West overnight by imposing a ban on exports of diesel and petrol. This saw front month European gasoil futures surge by 4.5% yesterday, but they have fallen back again by around 2.7% in early trade today. The Russian ban compounds the problem of an already tight market for refined products that has been driven by hot weather, reduced refining capacity and Western embargoes on Russian crude supplies. The timing of the ban coincides with the decision by erstwhile Imperial institution the Bank of England yesterday to leave the official bank rate unchanged yesterday for the first time since November 2021. A majority of analysts surveyed by Bloomberg had expected the Bank to lift rates by 25bps to 5.50% but the Monetary Policy committee ultimately voted 5-4 against a hike. The decision probably swung on the softer than expected CPI inflation figures for August that were released earlier this week. Those numbers saw core inflation fall to 6.2% YoY and the headline number decelerate to 6.7% after a merciful fall in food price inflation. Motor fuels were the largest upward pressure on the headline number though, and Russia clearly isn’t helping on that score. The BOE hold followed a decision earlier in the week from the US Federal Reserve to leave the upper bound of the Fed Funds rate unchanged at 5.50%, a move widely expected by surveyed analysts (including us). Despite holding at this meeting, the Fed upgraded its dot plot forecasts on the trajectory of interest rates and has maintained its bias towards another hike in 2023. The median of the FOMC dot plot is now well north of the OIS curve for 2024 and 2025, and the prospect of higher rates has been received poorly by equity markets. The S&P500 has lost 115 points so far this week as the higher for longer narrative gets priced in and increased geopolitical tensions threaten to roll back the frontiers of the empire of American capital. There was a point of difference in the world of central banking this week from the Rijksbank and Norges Bank. Both central banks hiked rates by 25bps, following a similar decision by the ECB last week. Rijksbank projections suggest that Swedish rates may have now peaked at 4%, but there is a slight tightening bias implied by the projected peak in the rate path of 4.10%. The Norges Bank was more explicit, raising the outlook for the peak in its policy rate from the current policy level of 4.25% to 4.5% through 2024. Here again the “higher for longer” narrative applies. Higher for longer is undoubtedly an unpopular meme, and financial markets remain slow to accept it if rates curves are any guide. Even so, we are now seeing 10-year treasury yields at the highest levels this side of Western capitalism’s near death experience 15 years ago, leaving the “rate cuts soon!” brigade of equity managers and real estate spruikers asking “Quo Vadis?” while overleveraged governments and households say “et tu, Brute?” How sustainable is this with the immense debt loads that we are currently carrying? What will happen once US student loan repayments resume next month for the first time in 3 years? Can equity and real estate valuations continue to defy the most rapid rate tightening cycle in living memory? In so many ways it feels like the barbarians are at the gates. Undoubtedly, the unpopularity of higher rates is the main reason why they are the exclusive domain of an unelected technocracy. Central bankers are a modern breed of Optimates, while Tribunes of the Plebeians like former President Trump burnish their Populares credentials by promising to force rates lower. In this respect, as with all things, life boils down to the basic question: are you for Caesar? Or the Senate? Think about that. Tyler Durden Fri, 09/22/2023 - 10:30.....»»

India Suspends Visas For Canadians, Denounces Terrorist "Safe Haven" The India-Canada row has continued escalating, with India having suspended visa services for all Canadian nationals on Thursday.  A statement said the temporary move is the result of "security threats" against Indian consuls in India, while denouncing Canada as a terrorist "safe haven".  Prime Minister Justin Trudeau had on Monday alleged that Indian intelligence assassinated Sikh separatist Hardeep Singh Nijjar at a temple outside Vancouver in June. New Delhi angrily rejected the accusation as "absurd".  Sign outside the temple where Canadian Sikh leader Hardeep Singh Nijjar was gunned down, via Reuters. Canada's Public Safety Minister Dominic LeBlanc has emphasized that "Canada is a safe country" after India initially issued a travel advisory telling the tens of thousands of Indians inside Canada to exercise caution. According to the full Indian government statement: "There have been threats made to our high commission [embassy] and consulates in Canada," a foreign affairs ministry spokesman in Delhi said. "This has disrupted their normal functioning. Accordingly [they] are temporarily unable to process visa applications." He said: "India is looking for parity in rank and diplomatic strength between the diplomatic missions of the two countries. This is being sought because of Canadian diplomatic interference in our internal affairs." Hours earlier Canada had announced it was reducing its personnel in India, saying some diplomats had received threats on social media. "In light of the current environment where tensions have heightened, we are taking action to ensure the safety of our diplomats," a statement said. India has further charged that that Canadian government is trying to "shift the focus from Khalistani terrorists and extremists" who were given shelter there. The slain Sikh leader Nijjar had long been a "wanted terrorist" - and has complained these terror and separatist activities have been enabled on Canadian soil. Trudeau at the G20 summit in India earlier this month tried to rally Western allies to pile the pressure on PM Modi, but reportedly to no avail, as many countries including the US are wary of harming relations with India and its large economy.  Tyler Durden Fri, 09/22/2023 - 02:45.....»»

Swiss Parliament Approves Burqa Ban, Imposes Steep Fine Via Middle East Eye, Switzerland's parliament has approved a ban on face coverings in legislation thought to be targeting Muslim women wearing burqas and niqabs.  The country's lower parliamentary chamber voted overwhelmingly in favor of the bill on Wednesday, which was passed with 151 votes in favor and 29 against. The upper chamber had previously approved the ban, which was strongly supported by the right-wing Swiss People's Party.  Image source: EUobserver It prohibits the covering of the nose, mouth and eyes in public places, as well as private buildings that can be accessed by the public.  The ban will now become federal law, and those who violate it will be fined 1,000 Swiss francs ($1,114).  Two years ago, Switzerland narrowly voted in a referendum to endorse a public ban on niqabs, burqas, ski masks and bandanas worn by protesters. Over 51 percent voted in favour, while nearly 49 percent voted against it.  The new law has a number of exceptions, including for indigenous customs, religious services, theatrical performances and face coverings for health and climate reasons.  It now brings Switzerland in line with several other European countries that have banned the burqa in some form, including France, Belgium, Bulgaria, Austria, Denmark and the Netherlands.  In 2009, in another policy focused on the Muslim community, Switzerland prohibited the construction of new mosque minarets, the towers traditionally built to project calls to prayer, after a campaign led by right-wing parties. A study in 2021 by the University of Lucerne put the number of women in Switzerland who wore a niqab at between 21 and 37 and found no evidence at all of any women wearing the burqa. Muslims make up around five percent of the Swiss population of 8.6 million, or about 390,000 people, most of whom have their roots in Turkey, Bosnia and Kosovo.  Tyler Durden Fri, 09/22/2023 - 03:30.....»»

Mapping The Migration Of The World's Millionaires In 2023 Just like everyone else, High Net Worth Individuals (HNWIs) traveled less than usual during the pandemic, and as a result their migration numbers trended downwards. But, as Visual Capitalist's Avery Koops details below, millionaires and billionaires are on the move again and it is anticipated that 122,000 HNWIs will move to a new country by the end of the year. Henley & Partners’ Private Wealth Migration Report has tracked the countries HNWIs have moved from and to over the last 10 years; this map showcases the 2023 forecasts. In this context, HNWIs are defined as individuals with a net worth of at least $1 million USD. The Countries Welcoming New Millionaires The top 10 countries which are likely to become home to the highest number of millionaires and billionaires in 2023 are scattered across the globe, with Australia reclaiming its top spot this year from the UAE. Here’s a closer look at the data: Only two Asian countries make the top 10, with the rest spread across Europe, North America, and Oceania. Despite historic economic challenges, Greece is projected to gain 1,200 High Net Worth Individuals this year. One reason could be the country’s golden visa program, wherein wealthy individuals can easily obtain residence and eventually EU passports for the right price—currently a minimum real estate investment cost of 250,000 euros is all that’s required. Many of the leading millionaire destinations are attractive for wealthy individuals because of higher levels of economic freedom, allowing for laxer tax burdens or ease of investment. Singapore, which expects to gain 3,200 millionaires, is the most economically free market in the world. The Countries Losing the Most Millionaires China is anticipated to lose 13,500 High Net Worth Individuals this year, more than double as many as the second place country, India (6,500). Here’s a closer look at the bottom 10: In a number of these countries, strict regulatory bodies and corrupt governments can hinder the ease with which HNWIs can manage their own money. In Russia, many wealthy individuals are facing personal tariffs and trade restrictions from Western countries due to the war in Ukraine. China’s crackdowns on Hong Kong have made it a less attractive place for business. And finally, the UK’s exit from the EU has caused many businesses and individuals to lose the easy movement of labor, finances, and investment that made operations across European borders seamless. Some of these countries may still be adding homegrown millionaires and billionaires, but losing thousands of HNWIs to net migration does have a considerable economic impact. Overall, millionaires are increasingly on the move. In the 10 years of reporting—despite a dip during the pandemic—the number of HNWIs moving away from their countries of origin has been growing every year. Here’s a look at the numbers: In a geopolitically fragile but more connected world, it’s no surprise to see millionaires voting with their feet. As a result, governments are increasingly in competition to win the hearts and minds of the world’s economic elite to their side. Tyler Durden Fri, 09/22/2023 - 04:15.....»»

New studies show that wellness apps and fitness devices that count your steps and track your calories can actually be bad for your health. Fitness trackers have taken over. But is the deluge of fitness data making Americans healthier?Arantza Pena Popo/ InsiderOver the past seven or eight years, I've developed a habit. Whenever I have a brief moment of calm or boredom during my day, without really thinking about it, I'll pull up my smartphone's health-tracking app to check my step count. If it's late in the day and the number is low, I might decide to go out and walk a few blocks or take the long way home. If it's low at the end of a busy month, I might try to squeeze in a few extra long walks to pull up the average. And if it's low at the end of a busy year, I'll almost certainly fall into a spiral of self-recrimination: What was I doing with my time, exactly, that was more important than getting a bare minimum of daily steps? My step-counter guilt has been enabled by the growing ubiquity of health-tracking tech. Over the past decade, a dizzying array of smartwatches, activity-monitoring apps, and even high-tech activewear has flooded the marketplace, each promising to support their users' quests toward living their best and fittest lives. These tools count a person's heartbeat, hours of sleep, and even the length of your gait (and whether or not you should be worried about it). They are programmed into our phones, worn on our wrists, and even forced onto us by creepy employers. Entire fitness regimes replete with complex point systems and digital rewards are designed around the data they amass. What used to be just a helpful tool for health nuts has bloomed into a multibillion-dollar market. But is this deluge of data making Americans healthier? While some people are certainly motivated to move more because their phone or watch reminds them to, for others the proverbial carrot of self-optimization can become a source of dangerous preoccupation. Far from a silver-bullet solution to healthy living, these always-on tools and the culture of self-optimization they foster can stand in the way of our well-being. When numbers take overThe 10,000-step benchmark has generally been the baseline goal for smartphone apps and fitness trackers. Despite the cultural cache, the 10,000-step benchmark was not developed by scientists. Instead, it grew out of a marketing campaign by the Japanese company Yamasa to promote its new step-counting gadget during the 1964 Tokyo Olympics. Actual peer-reviewed studies have subsequently found that it takes far fewer steps a day to significantly lower the risk of mortality — and yet 10,000 steps remains the gold standard. The allure of 10,000 steps kind of makes sense: It's a nice, round number that's easy to remember, and in East Asia, it symbolizes the idea of plenty. Most critically, it provides a health target that's reassuringly direct — one easier to focus on than a messier holistic picture of well-being. Research suggests a number-crunching approach to well-being actively undermines the formation of sustainable, healthy habits.When the Fitbit tracker launched in 2009, 45 years after Yamasa's gadget cemented the 10,000-steps ideal in the public consciousness, it kick-started a boom in fitness wearables and spawned a frenzy for health data. Between 2010 and 2015, the company's sales grew from 58,000 to nearly 21.4 million devices each year. Much like the iPhone revolutionized the mobile-phone market, the Apple Watch's debut eight years ago cemented the fitness wearable as a desirable lifestyle product that could unlock a path to self-optimization. This flood of easily accessible health data has certainly had some positive effects. Numerous studies have shown that fitness trackers can provide users with a jolt of motivation to exercise — at least in the short term. Given that an overwhelming majority of Americans don't meet the US Department of Health and Human Services' recommended weekly exercise quotas, even a small boost in movement can have meaningfully positive health implications. Research indicates that for every 2,000 steps a person takes each day, their risk of premature death may fall by as much as 8% to 11%. Amanda Paluch, a physical activity epidemiologist and kinesiologist at the University of Massachusetts Amherst who studies the health benefits of fitness-tracking technology, said that for "moderately active" individuals like me, apps and wearables can be "a great tool." Quantifying our movement makes it easier to incrementally ramp up daily exercise incentives, which helps prevent injury and generally makes being more active more achievable. Many fitness-tracking products also incorporate social-sharing features, which can give us a better perspective on how our exercise habits stack up against our friends', providing a little healthy competition as motivation. While the guilt and anxiety I feel staring down the final hours of a 300-step workday aren't necessarily great, if that number prods me into racking up a couple thousand steps before the total resets at midnight — which it sometimes does — then the data is ultimately making me healthier. It's an intermittently effective Band-Aid for all the sitting that's baked into my daily life. But for all the upsides, that deluge of data can also spur unhealthy fixations and negative consequences down the road.There's no one-size-fits-all health metricDespite her pro-tracking position, Paluch concedes that there are downsides to living by the numbers on a scale or screen. "The thing with physical activity, or any type of health behavior, is that it's based on the individual," she told me. "How much activity you need in order to see various health benefits — like lowering your blood pressure or improving your mental health or lowering your risk of cardiovascular disease — is going to be different depending on the person." The optimal fitness regimen for a person depends on a wide variety of factors: their age, whether or not they have a chronic health condition, and even their genetic makeup. This inherent variability means that striving to outdo someone else's fitness metrics or meet the static targets laid out by an app can be a double-edged sword. Research suggests a number-crunching approach to well-being actively undermines the formation of sustainable, healthy habits. It gamifies fitness goals without factoring in the bigger picture of what a particular body might need on any given day and effectively reduces the care of our complex systems to arbitrary targets. This route can be handy for those of us who need to-do lists stacked with itemized tasks to get anything done, but it does little to support healthy choices beyond the limited scope of achieving select daily benchmarks. If I'm meeting my caloric requirements with a diet of pilsner and french fries, for instance, it doesn't really matter that I'm consuming as much energy as I can burn. When you are number-obsessed, it can really — pardon my French — fuck with your brain."If I see my physical activity solely as a numerical output, then I end up with little choice but to think of my body as a quantity of something," John Toner, a health sciences professor at University of Hull in the UK, cautioned in a 2018 paper published in the journal Performance Enhancement & Health. "Perhaps I am merely a quantity of fat or only capable of a certain quantity of power." Toner went on to explain that although measurement might spur a person to increase how much of an activity they do, it can also decrease their intrinsic motivation to do those activities in the long run. It may even make those activities less enjoyable, turning what should be recreation into yet another chore of productivity.Then there's the pinging and pestering. Many health- and fitness-tracking apps and wearables issue notifications throughout the day to urge their users toward their movement goals. While these little reminders can be helpful to some, they also play on users' insecurities about personal achievement and can cause people to fixate too much on the numbers. In some cases, users rearrange their entire lives in harmful ways to achieve their daily goals. Studies have found that exercise tracking can be linked to patterns of restrictive behavior in eating-disorder patients, and there's a growing body of research into whether the use of wearable fitness trackers contributes to the development of eating disorders.  "When you are number-obsessed, it can really — pardon my French — fuck with your brain," Cathleen Kronemer, a personal trainer based in St. Louis, told me. During her more than 30 years on the job, she's seen many clients fixate on calories, miles, steps, and pounds, beginning well before the advent of today's tech-enhanced trackers. But the rise in new gadgets has driven what Kronemer has called techorexia, a term for people who use of fitness wearables to fuel food restriction and overexercise. It was that same tendency, Kronemer said, that landed her in a residential treatment program in 2000 for anorexia, where she was fitted with a feeding tube. Today, Kronemer sees both sides of the fitness-tracking debate. Although these apps and wearables are not the source of eating disorders and overexercise, they pose a real risk to people who struggle to separate the pursuit of health from the rigid rules that fitness metrics may apply. At the same time, she recognizes that many people benefit from the extra push that numbers, goals, and a little competition can provide. Her own husband credits his Apple Watch with making him a better athlete. "In a perfect world, people would say, 'Let me use this data as a guide' as opposed to 'Let me believe in this like the Bible,'" Kronemer said. "People treat it like GPS. If it says, 'Go straight for three blocks and then turn right,' they think, 'I better not do anything but that. And if I did, I'm a failure.' I just think that there's got to be a happy medium, but Americans don't function on a happy medium."Endless optimizingWhile the allure of fitness-tracking apps has a lot to do with the psychological tricks they play on individual users, they also appeal to people because they fit so easily into our fast-paced lives. Overloaded work schedules, car-dependent commutes, and the nefarious convenience of food-delivery services make it harder than ever to take care of ourselves. A study by researchers at the Washington University School of Medicine in St. Louis found that in 2016, the average American adult spent 6.5 hours a day sitting down — an entire hour longer than in 2007. Considering the ongoing rise of app-based conveniences, today's number may be even higher. These modern pressures — combined with an obsession with optimizing for efficiency — has caused Americans to squeeze healthy habits into the margins. And fitness tech is there to help make it easier for us to squash it all in. In fact, the original Japanese step counter is said to have been created after an exchange between Yamasa's founder and a doctor who suggested that the nation's newfound prosperity had given rise to new conveniences which, in turn, discouraged physical activity. The pursuit of fitness has become absorbed into the American (over)work ethic. Instead of valuing wellness as worthy of pursuing in its own right, fitness is pursued as a means to an end: People work out in order to be more focused and productive at work, or to be more confident in order to be a better worker, or to be more attractive in order to — you guessed it — succeed in their career. When the step counter on my health app reminds me how little I've moved my body, I feel like a failure. But in truth, those disappointing numbers usually mean I lived my days exactly as most Americans are taught to: by prioritizing the completion of more and more tasks, then doing whatever I can to decompress enough to repeat the whole process tomorrow. When my steps are low, it's because I'm dutifully working hard and putting my well-being last.Fitness tracking is no silver bullet, but it's not inherently antithetical to the cause. Despite my ambivalence, I suspect I will always turn to certain technological tools to keep me honest and active, hopefully for many years to come. For others, the tools may hurt more than they help. Everybody, and every body, is different.Kelli María Korducki is a journalist whose work focuses on work, tech, and culture. She's based in New York City.Read the original article on Business Insider.....»»

Instacart shares eroded most of their first-day gains to close Wednesday just 10 cents above the $30 float price. Instacart shares started trading on Tuesday.Getty Images Instacart soared 40% above its IPO price on Tuesday as trading began. Its shares have since tumbled close to its debut price of $30 as momentum fades. Analysts raised potential competition issues that may hamper Instacart's growth, Bloomberg reported. Shares in Instacart, America's largest grocery-delivery operator, tumbled on Wednesday on the second day of trading. The stock soared 43% in its trading debut on Tuesday, but most of those gains were wiped out the following day when shares closed at $30.10, just 1o cents above its float price. The fall was partly due to a wider selloff in equity markets ahead of Jerome Powell's Fed speech, and as analysts began to give their assessments on the stock. Phil Lempert, a grocery analyst and editor of SupermarketGuru, told Bloomberg that consumers are choosing to shop in-person more. "Finally people can see under the hood related to Instacart that this is not a stable situation," he said. "From a consumer standpoint we have seen a move away from delivery to click and collect, where a shopper orders online and schedules a time to pick up their groceries at the store," Lempert told the outlet.Instacart's plunge is a cautionary tale for other companies thinking of coming to market following Arm's successful debut last week. The chipmaker soared 25% on its first day of trading to be worth about $65 billion, but has since lost ground every day since then and is now valued at about $54 billion.Read the original article on Business Insider.....»»

"Higher-level training" had mostly been put on hold since the full-scale invasion began in 2022, the UK Ministry of Defence said in a daily update. Russian soldiers in St. Petersburg on August 25, 2022.Photo by OLGA MALTSEVA/AFP via Getty Images Russia's lack of training is hindering its troops' ability for successful attacks, the UK MOD said. A leading factor is the absence of unit rotations away from the battlefield, it said. Russia has struggled to recruit new soldiers since Putin's call-up last fall. Russia's lack of advanced training has left its troops mostly unable to advance in Ukraine, UK intelligence said on Thursday."Higher-level training" had mostly been put on hold since the full-scale invasion began in 2022, the UK Ministry of Defence said in a daily update.This had left it struggling in "conducting successful complex offensive operations," per the update — the type of work needed to achieve Russia's aim of conquering Ukraine.The MOD post linked the lack of training to Russia's decision to keep it units in combat continuously, rather than rotating them out of the most intense fighting, which is when training could take place.That was in turn linked to Russia's ongoing struggle to recruit enough people to conduct the war.The MOD cited recent comments by a Russian parliamentary official, Andrei Kartapolov, who said that mobilized personnel would have to serve until the war is over and could not be rotated out.Russia's most significant effort to increase its manpower began a year ago, with the conscription of around 300,000 Russian reservists.That move prompted tens of thousands of Russian men to flee the country and prompted wider unrest. Shortly after, the Kremlin said it wouldn't do any further waves of mobilization.That leaves a major recruitment problem and limited supplies of willing fighters. To fill in the gaps, Russia passed a number of bills in July to widen the pool of males who are eligible to fight. President Vladimir Putin signed a bill into law to raise the maximum age for male conscription from 27 to 30 years old from 2024 to enable more men to be drafted.Another measure also increased the age limit for when retired soldier could be called back up, in some cases extending it to 55.It remains unclear whether those recruitment efforts will translate into meaningful changes in the war.Read the original article on Business Insider.....»»

Baby boomers' stocks and houses gained value for years due to low interest rates, and now they can earn 5% from Treasury bills, Larry McDonald said. Baby boomers are the big winners from the Fed's policies, Larry McDonald says.Shutterstock Baby boomers are the big winners from the Federal Reserve's policies, Larry McDonald said. Years of low interest rates boosted asset prices, and now they can earn 5% from Treasury bills. Younger generations are battling inflation as well as higher costs for mortgages and other debts. Baby boomers are the big winners from the Federal Reserve's policies in recent years, while millennials and Gen Z have been badly burnt, Larry McDonald said."The Fed made the baby boomers really REALLY rich - then figured out a way to make T-Bills yield 5% so the boomers could ride off into the sunset risk-free," the founder of "The Bear Traps Report" wrote in a post on X Wednesday."Everybody in the younger generations just gets screwed because they can't finance anything," he added.McDonald, the former US head of macro strategy at Société Générale, was referring to the central bank keeping interest rates close to zero and boosting the money supply during the 2008 financial crisis and pandemic, which pushed up the prices of stocks, real estate, and other assets to record highs.The Fed's loose monetary policy, coupled with supply shocks including Russia's invasion of Ukraine last year and supply-chain disruptions during the pandemic, drove inflation to 40-year highs last year.The central bank responded by hiking rates to more than 5%, which has lifted mortgage rates above 7%, sparking an affordability crisis in the housing market.The upshot is that many young consumers are facing a brutal combination of inflated food, energy, and housing costs, as well as bigger monthly interest payments on their credit cards, car loans, and mortgages.Older people who own their homes outright, or have locked in 30-year mortgages at rock-bottom rates, have been less affected by that double-whammy. Moreover, many of them were able to buy stocks and homes at far lower prices in the past, and have enjoyed substantial appreciation in the value of their assets.McDonald's X post made the point that higher rates have lifted yields on Treasury bills to more than 5%. As a result, baby boomers have the option to cash out their profits, invest in short-term government debt, and collect a solid, guaranteed return.The former Lehman Brothers trader, who wrote a book about the investment bank's collapse at the start of the financial crisis, has flagged wealth disparities between generations before. He's noted that at the age of 40, baby boomers had paid far less for college and their homes than millennials, a larger percentage owned homes, and they generally had higher net worths and smaller debts."Baby boomer party, then left the check in the lap of Millennials," McDonald tweeted in early 2019. He's also noted that boomers were worth an estimated $78 trillion, or about half the US total, at the end of last year. That's despite the cohort making up just a fifth of the US population.While baby boomers are under fire for hoarding wealth, their spending in retirement could prove crucial in sustaining the economy and preventing a recession, market veteran Ed Yardeni argued this summer. Read the original article on Business Insider.....»»

The DOL filed a lawsuit against three Barrio Taco restaurant in Michigan, seeking $823,000 in back wages and damages. nullEMS-FORSTER-PRODUCTIONS/Getty ImagesA taco chain made staff share their tips with other workers, the labor department claims.The "invalid" tip pool ultimately meant workers also paid the correct wages, the DOL said.The DOL filed a lawsuit against three Barrio Taco restaurant in Michigan, seeking $823,000 in back wages and damages.A taco chain could be ordered to pay $823,000 to workers after a Department of Labor investigation found that it made staff share their tips with other workers.The DOL filed a lawsuit against three Barrio Tacos locations in Michigan on September 7.Its investigators found that the restaurants and their owner, Jacob Hawley, "required tipped workers to surrender a portion of their cash and credit card tips to managers after each shift." The managers then redistributed these tips to non-tipped employees, including kitchen staff, the DOL said.As the restaurants operated these "invalid" tip pools, they weren't eligible to receive a tip credit against servers' and bartenders' wages, which essentially means restaurants can use tips to top up staff's wages to the federal minimum wage of $7.25 per hour. As the restaurants weren't eligible for a tip credit, the servers' and bartenders' wages minus tips were pushed below the federal minimum wage.The tip pools also caused the restaurants in East Lansing, Grand Rapids to incorrectly calculate overtime rates for tipped employees.The restaurants additionally failed to keep accurate records of rates of pay, hours worked, and overtime premiums due.The lawsuit is seeking $411,662 in back wages for 177 employees to cover tips taken, unpaid minimum wages, and unpaid overtime wages between October 2020 and October 2022, as well as an equal amount in liquidated damages. The DOL also assessed Hawley and the restaurants $23,904 in fines.Barrio Taco did not immediately respond to Insider's request for comment."The business did not take any tips from staff members or profit in any way," Hawley told The Detroit Free Press in response to the lawsuit. "It was an error in how tips were distributed amongst staff and what positions were tipped out … We are hoping to have this resolved shortly. We will correct any payroll errors as soon as the process has concluded and make it right by our staff if necessary."Barrio Tacos, founded in Ohio in 2012, has 21 locations, selling tacos as well as cocktails.Read the original article on Business Insider.....»»