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An amendment by Rand Paul barring the NIH from funding some types of research in China passed in the Senate amid new debate on COVID-19"s origin

The Senate also approved an amendment from GOP Sen. Joni Ernst that would ban US funding to the Wuhan Institute of Virology. Sen. Rand Paul, R-.....»»

Category: worldSource: nytMay 25th, 2021

Futures Rise On Taper, Evergrande Optimism

Futures Rise On Taper, Evergrande Optimism US index futures jumped overnight even as the Fed confirmed that a November tapering was now guaranteed and would be completed by mid-2022 with one rate hike now on deck, while maintaining the possibility to extend stimulus if necessitated by the economy. Sentiment got an additional boost from a strong showing of Evergrande stock - which closed up 17% - during the Chinese session, which peaked just after Bloomberg reported that China told Evergrande to avoid a near-term dollar bond default and which suggested that the "government wants to avoid an imminent collapse of the developer" however that quickly reversed when the WSJ reported, just one hour later, that China was making preparations for Evergrande's demise, and although that hammered stocks, the report explicitly noted that a worst-case scenario for Evergrande would mean a partial or full nationalization as "local-level government agencies and state-owned enterprises have been instructed to step in only at the last minute should Evergrande fail to manage its affairs in an orderly fashion." In other words, both reports are bullish: either foreign creditors are made whole (no default) as per BBG or the situation deteriorates and Evergrande is nationalized ("SOEs step in") as per WSJ. According to Bloomberg, confidence is building that markets can ride out a pullback in Fed stimulus, unlike 2013 when the taper tantrum triggered large losses in bonds and equities. "Investors are betting that the economic and profit recovery will be strong enough to outweigh a reduction in asset purchases, while ultra-low rates will continue to support riskier assets even as concerns linger about contagion from China’s real-estate woes." That's one view: the other is that the Fed has so broken the market's discounting ability we won't know just how bad tapering will get until it actually begins. “The Fed has got to be pleased that their communication on the longer way to tapering has avoided the dreaded fear of the tantrum,” Jeffrey Rosenberg, senior portfolio manager for systematic fixed income at BlackRock Inc., said on Bloomberg Television. “This is a very good outcome for the Fed in terms of signaling their intent to give the market information well ahead of the tapering decision.” Then there is the question of Evergrande: “With regards to Evergrande, all those people who are waiting for a Lehman moment in China will probably have to wait another turn,” said Ken Peng, an investment strategist at Citi Private Bank Asia Pacific. “So I wouldn’t treat this as completely bad, but there are definitely a lot of risks on the horizon.” In any case, today's action is a continuation of the best day in two months for both the Dow and the S&P which staged a strong recovery from two-month lows hit earlier in the week, and as of 745am ET, S&P 500 E-minis were up 25.25 points, or 0.6%, Dow E-minis were up 202 points, or 0.59%, while Nasdaq 100 E-minis were up 92.0 points, or 0.60%. In the premarket, electric vehicle startup Lucid Group rose 3.1% in U.S. premarket trading. PAVmed (PVM US) jumps 11% after its Lucid Diagnostics unit announced plans to list on the Global Market of the Nasdaq Stock Market.  Here are some of the biggest movers today: U.S.-listed Chinese stocks rise in premarket trading as fears of contagion from China Evergrande Group’s debt crisis ease. Blackberry (BB US) shares rise 8.7% in premarket after co.’s 2Q adjusted revenue beat the average of analysts’ estimates Eargo (EAR US) falls 57% in Thursday premarket after the hearing aid company revealed it was the target of a Justice Department criminal probe and withdrew its forecasts for the year Amplitude Healthcare Acquisition (AMHC US) doubled in U.S. premarket trading after the SPAC’s shareholders approved the previously announced business combination with Jasper Therapeutics Steelcase (SCS US) fell 4.8% Wednesday postmarket after the office products company reported revenue for the second quarter that missed the average analyst estimate Vertex Energy Inc. (VTNR US) gained 2.1% premarket after saying the planned acquisition of a refinery in Mobile, Alabama from Royal DutVTNR US Equitych Shell Plc is on schedule Synlogic (SYBX US) shares declined 9.7% premarket after it launched a stock offering launched without disclosing a size HB Fuller (FUL US) climbed 2.7% in postmarket trading after third quarter sales beat even the highest analyst estimate Europe's Stoxx 600 index rose 0.9%, lifted by carmakers, tech stocks and utilities, which helped it recover losses sparked earlier in the week by concerns about Evergrande and China’s crackdown on its property sector. The gauge held its gain after surveys of purchasing managers showed business activity in the euro area lost momentum and slowed broadly in September after demand peaked over the summer and supply-chain bottlenecks hurt services and manufacturers. Euro Area Composite PMI (September, Flash): 56.1, consensus 58.5, last 59.0. Euro Area Manufacturing PMI (September, Flash): 58.7, consensus 60.3, last 61.4. Euro Area Services PMI (September, Flash): 56.3, consensus 58.5, last 59.0. Germany Composite PMI (September, Flash): 55.3, consensus 59.2, last 60.0. France Composite PMI (September, Flash): 55.1, consensus 55.7, last 55.9. UK Composite PMI (September, Flash): 54.1, consensus 54.6, last 54.8. Commenting on Europe's PMIs, Goldman said that the Euro area composite PMI declined by 2.9pt to 56.1 in September, well below consensus expectations. The softening was broad-based across countries but primarily led by Germany. The peripheral composite flash PMI also weakened significantly in September but remain very high by historical standards (-2.4pt to 57.5). Across sectors, the September composite decline was also broad-based, with manufacturing output softening (-3.3pt to 55.6) to a similar extent as services (-2.7pt to 56.3). Supply-side issues and upward cost and price pressures continued to be widely reported. Expectations of future output growth declined by less than spot output on the back of delta variant worries and supply issues, remaining far above historically average levels. Earlier in the session, Asian stocks rose for the first time in four sessions, as Hong Kong helped lead a rally on hopes that troubled property firm China Evergrande Group will make progress on debt repayment. The MSCI Asia Pacific Index climbed as much as 0.5%, with Tencent and Meituan providing the biggest boosts. The Hang Seng jumped as much as 2.5%, led by real estate stocks as Evergrande surged more than 30%. Hong Kong shares later pared their gains. Asian markets were also cheered by gains in U.S. stocks overnight even as the Federal Reserve said it may begin scaling back stimulus this year. A $17 billion net liquidity injection from the People’s Bank of China also provided a lift, while the Fed and Bank of Japan downplayed Evergrande risks in comments accompanying policy decisions Wednesday. Evergrande’s stock closed 18% higher in Hong Kong, in a delayed reaction to news a unit of the developer had negotiated interest payments on yuan notes. A coupon payment on its 2022 dollar bond is due on Thursday “Investors are perhaps reassessing the tail risk of a disorderly fallout from Evergrande’s credit issues,” said Chetan Seth, a strategist at Nomura. “However, I am not sure if the fundamental issue around its sustainable deleveraging has been addressed. I suspect markets will likely remain quite volatile until we have some definite direction from authorities on the eventual resolution of Evergrande’s debt problems.” Stocks rose in most markets, with Australia, Taiwan, Singapore and India also among the day’s big winners. South Korea’s benchmark was the lone decliner, while Japan was closed for a holiday In rates, Treasuries were off session lows, with the 10Y trading a 1.34%, but remained under pressure in early U.S. session led by intermediate sectors, where 5Y yield touched highest since July 2. Wednesday’s dramatic yield-curve flattening move unleashed by Fed communications continued, compressing 5s30s spread to 93.8bp, lowest since May 2020. UK 10-year yield climbed 3.4bp to session high 0.833% following BOE rate decision (7-2 vote to keep bond-buying target unchanged); bunds outperformed slightly. Peripheral spreads tighten with long-end Italy outperforming. In FX, the Bloomberg Dollar Spot Index reversed an earlier gain and dropped 0.3% as the dollar weakened against all of its Group-of-10 peers apart from the yen amid a more positive sentiment. CAD, NOK and SEK are the strongest performers in G-10, JPY the laggard.  The euro and the pound briefly pared gains after weaker-than-forecast German and British PMIs. The pound rebounded from an eight-month low amid a return of global risk appetite as investors assessed whether the Bank of England will follow the Federal Reserve’s hawkish tone later Thursday. The yield differential between 10-year German and Italian debt narrowed to its tightest since April. Norway’s krone advanced after Norges Bank raised its policy rate in line with expectations and signaled a faster pace of tightening over the coming years. The franc whipsawed as the Swiss National Bank kept its policy rate and deposit rate at record lows, as expected, and reiterated its pledge to wage currency market interventions. The yen fell as a unit of China Evergrande said it had reached an agreement with bond holders over an interest payment, reducing demand for haven assets. Turkey’s lira slumped toa record low against the dollar after the central bank unexpectedly cut interest rates. In commodities, crude futures drifted lower after a rangebound Asia session. WTI was 0.25% lower, trading near $72; Brent dips into the red, so far holding above $76. Spot gold adds $3.5, gentle reversing Asia’s losses to trade near $1,771/oz. Base metals are well bid with LME aluminum leading gains. Bitcoin steadied just below $44,000. Looking at the day ahead, we get the weekly initial jobless claims, the Chicago Fed’s national activity index for August, and the Kansas City fed’s manufacturing activity index for September. From central banks, there’ll be a monetary policy decision from the Bank of England, while the ECB will be publishing their Economic Bulletin and the ECB’s Elderson will also speak. From emerging markets, there’ll also be monetary policy decisions from the Central Bank of Turkey and the South African Reserve Bank. Finally in Germany, there’s an election debate with the lead candidates from the Bundestag parties. Market Snapshot S&P 500 futures up 0.7% to 4,413.75 STOXX Europe 600 up 1.1% to 468.32 MXAP up 0.5% to 200.57 MXAPJ up 0.9% to 645.76 Nikkei down 0.7% to 29,639.40 Topix down 1.0% to 2,043.55 Hang Seng Index up 1.2% to 24,510.98 Shanghai Composite up 0.4% to 3,642.22 Sensex up 1.4% to 59,728.37 Australia S&P/ASX 200 up 1.0% to 7,370.22 Kospi down 0.4% to 3,127.58 German 10Y yield fell 5.6 bps to -0.306% Euro up 0.4% to $1.1728 Brent Futures up 0.3% to $76.39/bbl Gold spot up 0.0% to $1,768.25 U.S. Dollar Index down 0.33% to 93.16 Top Overnight News from Bloomberg Financial regulators in Beijing issued a broad set of instructions to China Evergrande Group, telling the embattled developer to focus on completing unfinished properties and repaying individual investors while avoiding a near-term default on dollar bonds China’s central bank net-injected the most short- term liquidity in eight months into the financial system, with markets roiled by concerns over China Evergrande Group’s debt crisis Europe’s worst energy crisis in decades could drag deep into the cold months as Russia is unlikely to boost shipments until at least November Business activity in the euro area “markedly” lost momentum in September after demand peaked over the summer and supply chain bottlenecks hurt both services and manufacturers. Surveys of purchasing managers by IHS Markit showed growth in both sectors slowing more than expected, bringing overall activity to a five-month low. Input costs, meanwhile, surged to the highest in 21 years, according to the report The U.K. private sector had its weakest month since the height of the winter lockdown and inflation pressures escalated in September, adding to evidence that the recovery is running into significant headwinds, IHS Markit said The U.K.’s record- breaking debut green bond sale has given debt chief Robert Stheeman conviction on the benefits of an environmental borrowing program. The 10 billion-pound ($13.7 billion) deal this week was the biggest-ever ethical bond sale and the country is already planning another offering next month A more detailed look at global markets courtesy of Newsquaw Asian equity markets traded mostly positive as the region took its cue from the gains in US with the improved global sentiment spurred by some easing of Evergrande concerns and with stocks also unfazed by the marginally more hawkish than anticipated FOMC announcement (detailed above). ASX 200 (+1.0%) was underpinned by outperformance in the commodity-related sectors and strength in defensives, which have more than atoned for the losses in tech and financials, as well as helped markets overlook the record daily COVID-19 infections in Victoria state. Hang Seng (+0.7%) and Shanghai Comp. (+0.6%) were also positive after another respectable liquidity operation by the PBoC and with some relief in Evergrande shares which saw early gains of more than 30% after recent reports suggested a potential restructuring by China’s government and with the Co. Chairman noting that the top priority is to help wealth investors redeem their products, although the majority of the Evergrande gains were then pared and unit China Evergrande New Energy Vehicle fully retraced the initial double-digit advances. KOSPI (-0.5%) was the laggard as it played catch up to the recent losses on its first trading day of the week and amid concerns that COVID cases could surge following the holiday period, while Japanese markets were closed in observance of the Autumnal Equinox Day. China Pumps $17 Billion Into System Amid Evergrande Concerns China Stocks From Property to Tech Jump on Evergrande Respite Philippines Holds Key Rate to Spur Growth Amid Higher Prices Taiwan’s Trade Deal Application Sets Up Showdown With China Top Asian News European equities (Stoxx 600 +0.9%) trade on the front-foot and have extended gains since the cash open with the Stoxx 600 now higher on the week after Monday’s heavy losses. From a macro perspective, price action in Europe has been undeterred by a slowdown in Eurozone PMIs which saw the composite metric slip to 56.1 from 59.0 (exp. 58.5) with IHS Markit noting “an unwelcome combination of sharply slower economic growth and steeply rising prices.” Instead, stocks in the region have taken the cue from a firmer US and Asia-Pac handover with performance in Chinese markets aided by further liquidity injections by the PBoC. Some positivity has also been observed on the Evergrande front amid mounting expectations of a potential restructuring at the company. That said, at the time of writing, it remains unclear what the company’s intentions are for repaying its USD 83.5mln onshore coupon payment. Note, ING highlights that “missing that payment today would still leave a 30-day grace period before this is registered as a default”. The most recent reports via WSJ indicate that Chinese authorities are asking local governments to begin preparations for the potential downfall of Evergrande; however, the article highlights that this is a last resort and Beijing is reluctant to step in. Nonetheless, this article has taken the shine off the mornings risk appetite, though we do remain firmer on the session. Stateside, as the dust settles on yesterday’s FOMC announcement, futures are firmer with outperformance in the RTY (+0.8% vs. ES +0.7%). Sectors in Europe are higher across the board with outperformance in Tech and Autos with the latter aided by gains in Faurecia (+4.6%) who sit at the top of the Stoxx 600 after making an unsurprising cut to its guidance, which will at least provide some clarity on the Co.’s near-term future; in sympathy, Valeo (+6.6) is also a notable gainer in the region. To the downside, Entain (+2.6%) sit at the foot of the Stoxx 600 after recent strong gains with the latest newsflow surrounding the Co. noting that MGM Resorts is considering different methods to acquire control of the BetMGM online gambling business JV, following the DraftKings offer for Entain, according to sources. The agreement between Entain and MGM gives MGM the ability to block any deal with competing businesses; MGM officials believe this grants the leverage to take full control of BetMGM without spending much. Top European News BOE Confronts Rising Prices, Slower Growth: Decision Guide La Banque Postale Eyes Retail, Asset Management M&A in Europe Activist Bluebell Raises Pressure on Glaxo CEO Walmsley Norway Delivers Rate Lift-Off With Next Hike Set for December In FX, not much bang for the Buck even though the FOMC matched the most hawkish market expectations and Fed chair Powell arguably went further by concluding in the post-meeting press conference that substantial progress on the lagging labour front is all but done. Hence, assuming the economy remains on course, tapering could start as soon as November and be completed my the middle of 2022, though he continued to play down tightening prospects irrespective of the more hawkish trajectory implied by the latest SEP dot plots that are now skewed towards at least one hike next year and a cumulative seven over the forecast horizon. However, the Greenback only managed to grind out marginally higher highs overnight, with the index reaching 93.526 vs 93.517 at best yesterday before retreating quite sharply and quickly to 93.138 in advance of jobless claims and Markit’s flash PMIs. CAD/NZD/AUD - The Loonie is leading the comeback charge in major circles and only partially assisted by WTI keeping a firm bid mostly beyond Usd 72/brl, and Usd/Cad may remain contained within 1.2796-50 ahead of Canadian retail sales given decent option expiry interest nearby and protecting the downside (1 bn between 1.2650-65 and 2.7 bn from 1.2620-00). Meanwhile, the Kiwi has secured a firmer grip on the 0.7000 handle to test 0.7050 pre-NZ trade and the Aussie is looking much more comfortable beyond 0.7250 amidst signs of improvement in the flash PMIs, albeit with the services and composite headline indices still some way short of the 50.0 mark. NOK/GBP/EUR/CHF - All firmer, and the Norwegian Crown outperforming following confirmation of the start of rate normalisation by the Norges Bank that also underscored another 25 bp hike in December and further tightening via a loftier rate path. Eur/Nok encountered some support around 10.1000 for a while, but is now below, while the Pound has rebounded against the Dollar and Euro in the run up to the BoE at midday. Cable is back up around 1.3770 and Eur/Gbp circa 0.8580 as Eur/Usd hovers in the low 1.1700 area eyeing multiple and a couple of huge option expiries (at the 1.1700 strike in 4.1 bn, 1.1730 in 1 bn, 1.1745-55 totalling 2.7 bn and 1.8 bn from 1.1790-1.1800). Note, Eurozone and UK flash PMIs did not live up to their name, but hardly impacted. Elsewhere, the Franc is lagging either side of 0.9250 vs the Buck and 1.0835 against the Euro on the back of a dovish SNB Quarterly Review that retained a high Chf valuation and necessity to maintain NIRP, with only minor change in the ordering of the language surrounding intervention. JPY - The Yen is struggling to keep its head afloat of 110.00 vs the Greenback as Treasury yields rebound and risk sentiment remains bullish pre-Japanese CPI and in thinner trading conditions due to the Autumn Equinox holiday. In commodities, WTI and Brent have been choppy throughout the morning in-spite of the broadly constructive risk appetite. Benchmarks spent much of the morning in proximity to the unchanged mark but the most recent Evergrande developments, via WSJ, have dampened sentiment and sent WTI and Brent back into negative territory for the session and printing incremental fresh lows at the time of publication. Back to crude, newsflow has once again centred around energy ministry commentary with Iraq making clear that oil exports will continue to increase. Elsewhere, gas remains at the forefront of focus particularly in the UK/Europe but developments today have been somewhat incremental. On the subject, Citi writes that Asia and Europe Nat. Gas prices could reach USD 100/MMBtu of USD 580/BOE in the winter, under their tail-risk scenario. For metals, its very much a case of more of the same with base-metals supportive, albeit off-best given Evergrande, after a robust APAC session post-FOMC. Given the gas issues, desks highlight that some companies are being forced to suspend/reduce production of items such as steel in Asian/European markets, a narrative that could become pertinent for broader prices if the situation continues. Elsewhere, spot gold and silver are both modestly firmer but remain well within the range of yesterday’s session and are yet to recovery from the pressure seen in wake of the FOMC. US Event Calendar 8:30am: Sept. Initial Jobless Claims, est. 320,000, prior 332,000; Continuing Claims, est. 2.6m, prior 2.67m 8:30am: Aug. Chicago Fed Nat Activity Index, est. 0.50, prior 0.53 9:45am: Sept. Markit US Composite PMI, prior 55.4 9:45am: Sept. Markit US Services PMI, est. 54.9, prior 55.1 9:45am: Sept. Markit US Manufacturing PMI, est. 61.0, prior 61.1 11am: Sept. Kansas City Fed Manf. Activity, est. 25, prior 29 12pm: 2Q US Household Change in Net Wor, prior $5t DB's Jim Reid concludes the overnight wrap My wife was at a parents event at school last night so I had to read three lots of bedtime stories just as the Fed were announcing their policy decision. Peppa Pig, Biff and Kipper, and somebody called Wonder Kid were interspersed with Powell’s press conference live on my phone. It’s fair to say the kids weren’t that impressed by the dot plot and just wanted to join them up. The twins (just turned 4) got their first reading book homework this week and it was a bit sad that one of them was deemed ready to have one with words whereas the other one only pictures. The latter was very upset and cried that his brother had words and he didn’t. That should create even more competitive tension! Back to the dots and yesterday’s Fed meeting was on the hawkish side in terms of the dots and also in terms of Powell’s confidence that the taper could be complete by mid-2022. Powell said that the Fed could begin tapering bond purchases as soon as the November FOMC meeting, in line with our US economists’ forecasts. He left some room for uncertainty, saying they would taper only “If the economy continues to progress broadly in line with expectations, and also the overall situation is appropriate for this.” However he made clear that “the timing and pace of the coming reduction in asset purchases will not be intended to carry a direct signal regarding the timing of interest rate liftoff.” The quarterly “dot plot” showed that the 18 FOMC officials were split on whether to start raising rates next year or not. In June, the median dot indicated no rate increases until 2023, but now 6 members see a 25bps raise next year and 3 members see two such hikes. Their inflation forecasts were also revised up and DB’s Matt Luzzetti writes in his FOMC review (link here) that “If inflation is at or below the Fed's current forecast next year of 2.3% core PCE, liftoff is likely to come in 2023, consistent with our view. However, if inflation proves to be higher with inflation expectations continuing to rise, the first rate increase could well migrate into 2022.” Markets took the overall meeting very much in its stride with the biggest impact probably being a yield curve flattening even if US 10yr Treasury yields traded in just over a 4bp range yesterday and finishing -2.2bps lower at 1.301%. The 5y30y curve flattened -6.7bps to 95.6bps, its flattest level since August 2020, while the 2y10y curve was -4.2bps flatter. So the market seems to believe the more hawkish the Fed gets the more likely they’ll control inflation and/or choke the recovery. The puzzle is that even if the dots are correct, real Fed funds should still be negative and very accommodative historically for all of the forecasting period. As such the market has a very dim view of the ability of the economy to withstand rate hikes or alternatively that the QE technicals are overpowering everything at the moment. In equities, the S&P 500 was up nearly +1.0% 15 minutes prior to the Fed, and then rallied a further 0.5% in the immediate aftermath before a late dip look it back to +0.95%. The late dip meant that the S&P still has not seen a 1% up day since July 23. The index’s rise was driven by cyclicals in particular with energy (+3.17%), semiconductors (-2.20%), and banks (+2.13%) leading the way. Asian markets are mostly trading higher this morning with the Hang Seng (+0.69%), Shanghai Comp (+0.58%), ASX (+1.03%) and India’s Nifty (+0.81%) all up. The Kospi (-0.36%) is trading lower though and is still catching up from the early week holidays. Japan’s markets are closed for a holiday today. Futures on the S&P 500 are up +0.25% while those on the Stoxx 50 are up +0.49%. There is no new news on the Evergrande debt crisis however markets participants are likely to pay attention to whether the group is able to make interest rate payment on its 5 year dollar note today after the group had said yesterday that it resolved a domestic bond coupon by negotiations which was also due today. As we highlighted in our CoTD flash poll conducted earlier this week, market participants are not too worried about a wider fallout from the Evergrande crisis and even the Hang Seng Properties index is up +3.93% this morning and is largely back at the levels before the big Monday sell-off of -6.69%. Overnight we have received flash PMIs for Australia which improved as parts of the country have eased the coronavirus restrictions. The services reading came in at 44.9 (vs. 42.9 last month) and the manufacturing print was even stronger at 57.3 (vs. 52.0 last month). Japan’s flash PMIs will be out tomorrow due to today’s holiday. Ahead of the Fed, markets had continued to rebound from their declines earlier in the week, with Europe’s STOXX 600 gaining +0.99% to narrowly put the index in positive territory for the week. This continues the theme of a relative outperformance among European equities compared to the US, with the STOXX 600 having outpaced the S&P 500 for 5 consecutive sessions now, though obviously by a slim margin yesterday. Sovereign bonds in Europe also posted gains, with yields on 10yr bunds (-0.7bps), OATs (-1.0bps) and BTPs (-3.2bps) all moving lower. Furthermore, there was another tightening in peripheral spreads, with the gap in Italian 10yr yields over bunds falling to 98.8bps yesterday, less than half a basis point away from its tightest level since early April. Moving to fiscal and with Democrats seemingly unable to pass the $3.5 trillion Biden budget plan by Monday, when the House is set to vote on the bipartisan infrastructure bill, Republican leadership is calling on their members to vote against the bipartisan bill in hopes of delaying the process further. While the there is still a high likelihood the measure will eventually get passed, time is becoming a factor. Congress now has just over a week to get a government funding bill through both chambers of congress as well as raise the debt ceiling by next month. Republicans have told Democrats to do the latter in a partisan manner and include it in the reconciliation process which could mean that a significant portion of the Biden economic agenda – mostly encapsulated in the $3.5 trillion over 10 year budget – may have to be cut down to get the entire Democratic caucus on board. Looking ahead, an event to watch out for today will be the Bank of England’s policy decision at 12:00 London time, where our economists write (link here) that they expect no change in the policy settings. However, they do expect a reaffirmation of the BoE’s updated forward guidance that some tightening will be needed over the next few years to keep inflation in check, even if it’s too early to expect a further hawkish pivot at this stage. Staying on the UK, two further energy suppliers (Avro Energy and Green Supplier) ceased trading yesterday amidst the surge in gas prices, with the two supplying 2.9% of domestic customers between them. We have actually seen a modest fall in European natural gas prices over the last couple of days, with the benchmark future down -4.81% since its close on Monday, although it’s worth noting that still leaves them up +75.90% since the start of August alone. There wasn’t much data to speak of yesterday, though US existing home sales fell to an annualised rate of 5.88 in August (vs. 5.89m expected). Separately, the European Commission’s advance consumer confidence reading for the Euro Area unexpectedly rose to -4.0 in September (vs. -5.9 expected). To the day ahead now, the data highlights include the September flash PMIs from around the world, while in the US there’s the weekly initial jobless claims, the Chicago Fed’s national activity index for August, and the Kansas City fed’s manufacturing activity index for September. From central banks, there’ll be a monetary policy decision from the Bank of England, while the ECB will be publishing their Economic Bulletin and the ECB’s Elderson will also speak. From emerging markets, there’ll also be monetary policy decisions from the Central Bank of Turkey and the South African Reserve Bank. Finally in Germany, there’s an election debate with the lead candidates from the Bundestag parties. Tyler Durden Thu, 09/23/2021 - 08:13.....»»

Category: blogSource: zerohedge1 hr. 54 min. ago

Wuhan Scientists Planned To Release "Chimeric Covid Spike Proteins" Into Bat Populations Using "Skin-Penetrating Nanoparticles"

Wuhan Scientists Planned To Release 'Chimeric Covid Spike Proteins' Into Bat Populations Using 'Skin-Penetrating Nanoparticles' 18 months before the pandemic, scientists in Wuhan, China submitted a proposal to release enhanced airborne coronaviruses into the wild in an effort to inoculate them against diseases that could have otherwise jumped to humans, according to The Telegraph, citing leaked grant proposals from 2018. New documents show that just 18 months before the first Covid-19 cases appeared, researchers had submitted plans to release skin-penetrating nanoparticles containing “novel chimeric spike proteins” of bat coronaviruses into cave bats in Yunnan, China. They also planned to create chimeric viruses, genetically enhanced to infect humans more easily, and requested $14million from the Defense Advanced Research Projects Agency (Darpa) to fund the work. The bid was submitted by zoologist Peter Daszak of US-based EcoHealth Alliance, who was hoping to use genetic engineering to cobble "human-specific cleavage sites" onto bat Covid 'which would make it easier for the virus to enter human cells' - a method which would coincidentally answer a longstanding question among the scientific community as to how SARS-CoV-2 evolved to become so infectious to humans. Daszak's proposal also included plans to commingle high-risk natural coronaviruses strains with more infectious, yet less deadly versions. His 'bat team' of researchers included Dr. Shi Zhengli from the Wuhan Institute of Virology, as well as US researchers from the University of North Carolina and the US Geological Survey National Wildlife Health Center. Darpa refused the contract - saying "It is clear that the proposed project led by Peter Daszak could have put local communities at risk," while warning that Daszak hadn't fully considered the dangers involved in enhancing the virus via gain-of-function research, or by releasing a vaccine into the air. Grant documents show that the team also had some concerns about the vaccine programme and said they would “conduct educational outreach … so that there is a public understanding of what we are doing and why we are doing it, particularly because of the practice of bat-consumption in the region”. Angus Dalgleish, Professor of Oncology at St Georges, University of London, who struggled to get work published showing that the Wuhan Institute of Virology (WIV) had been carrying out “gain of function” work for years before the pandemic, said the research may have gone ahead even without the funding. “This is clearly a gain of function, engineering the cleavage site and polishing the new viruses to enhance human cell infectibility in more than one cell line,” he said. -Telegraph As the Telegraph aptly notes (and you'll never hear from Maddow, Lemon or Hayes), Daszak is the same guy behind a letter published in The Lancet last year which ruled out the lab leak hypothesis, and temporarily stifled debate on the origins of Covid-19. "For more than a year I tried repeatedly to ask questions of Peter Daszak with no response," said Viscount Ridley, who has co-authored an upcoming book on the origin of Covid-19, and has repeatedly implored the House of Lords to dig deeper into the origins of the pandemic. "Now it turns out he had authored this vital piece of information about virus work in Wuhan but refused to share it with the world. I am furious. So should the world be," he added. "Peter Daszak and the EcoHealth Alliance (EHA) proposed injecting deadly chimeric bat coronaviruses collected by the Wuhan Institute of Virology into humanised and ‘batified’ mice, and much, much more." The documents, released by an international consortium of scientists known as 'Drastic Research,' were authenticated by a former Trump administration official. According to the group, "The actual DEFUSE Proposal Documents will be published in due course." "Given that we find in this proposal a discussion of the planned introduction of human-specific cleavage sites, a review by the wider scientific community of the plausibility of artificial insertion is warranted," Drastic said in a statement. Enhanced MERS? One anonymous World Health Organization (WHO) scientist told The Telegraph that Daszak's grant proposal shockingly proposed plans to enhance the more deadly MERS (Middle-East Respiratory Syndrome). "The scary part is they were making infectious chimeric Mers viruses," said the source, adding "These viruses have a fatality rate over 30 per cent, which is at least an order of magnitude more deadly than Sars-CoV-2." "If one of their receptor replacements made Mers spread similarly, while maintaining its lethality, this pandemic would be nearly apocalyptic." Just remember, the initial cover story started with 'bat soup.' Tyler Durden Wed, 09/22/2021 - 07:00.....»»

Category: blogSource: zerohedgeSep 22nd, 2021

Stocks Slip This Week While Waiting for Stimulus

Stocks Slip This Week While Waiting for Stimulus The major indices pulled back this week as the market catches its breath after a record-setting run and wonders when Washington will agree on a stimulus package. The Dow crossed back over 30K on Friday after closing just under that mark yesterday. It gained 0.16% (or about 47 points) to 30,046.37. But the NASDAQ slipped 0.23% (or nearly 28 points) to 12,377.87, while the S&P declined 0.13% to 3663.46. For the week, the S&P was down 1% and the Dow was off 0.6%, which put an end to back-to-back weekly advances. The NASDAQ ended a three-week run by dipping 0.7% over the five days. The Senate passed a one-week government funding extension today, as did the House earlier this week. Assuming President Trump signs the measure, a government shutdown will be averted through Dec. 18. Unfortunately, that’s the only real progress that Capitol Hill has made this week. They appear to agree that something needs to get done while we wait for the vaccines to do their thing, but it’s only talk for now. The market hopes this extension will give them time to make it happen. We’ve been getting signs lately that the renewed restrictions amid rising coronavirus cases is having an economic impact. Most recently, the jobless claims soared past 800K for the first time in nearly two months, while falling well short of expectations and the previous week’s result. On Thursday, the Pfizer/BioNTech vaccine got one step closer to final approval when an FDA advisory panel recommended it for emergency use. Such news would’ve sent the market through the roof a few weeks ago.   And there’s the problem. All the positive vaccine news has been priced in, though the vaccine itself is still months away from normalizing our lives. In the meantime, the market needs a catalyst to keep moving higher after this record-setting run. Those folks in Washington are the best chance for that catalyst. Let’s hope it gets done next week. Today's Portfolio Highlights: Surprise Trader: Investors have always thought that the rising earnings in the RV space was unsustainable, but Dave believes its part of a paradigm shift. The upcoming quarterly report from Winnebago Industries (WGO) should be the latest example that this space isn’t a flash in the pan brought on by covid. The company has crushed the Zacks Consensus Estimate by double digits in the last two quarters and now has a positive Earnings ESP of 14.89% for the quarter coming before the bell next Friday, December 18. Furthermore, WGO is a Zacks Rank #1 (Strong Buy) with a VGM score of “A” that’s part of a space in the top 2% of the Zacks Industry Rank. The editor added WGO on Friday with a 12.5% allocation, while also selling Jack in the Box (JACK) for a 5.8% return in just under a month. Read the full write-up for more. TAZR Trader: The past couple days have been pretty eventful for Inseego (INSG). This small-cap “pioneer” in 5G and intelligent IoT device-to-cloud solutions provider announced that its 5G MiFi M2000 mobile hotspot would now be available in Japan, which gives it a much bigger footprint worldwide. This comes a day after T-Mobile selected this as its first 5G hotspot. INSG soared 12.2% on Friday to become the top-performing stock among all ZU names. Infinera (INFN) also made the Top 5 movers list with a gain of 4.4%.  Value Investor: "Stocks are in a wait-and-see mode as Congress continues to dither about the aid package. "Somehow it managed to pass a 1-week extension on the budget to avoid a government shutdown but it's no closer to a coronavirus agreement even as the Dec 26 deadline for the end to unemployment looms. "There are many who believe they positively won't allow that deadline to pass without passing something, but I would remind you all that many thought the same thing about the late July deadline on the extra $600 a week. "Not only did Congress let the $600 a week expire but they haven't even given it a second thought. "Anything will be possible next week. This stock market will move on the headlines, once again." -- Tracey Ryniec Have a Great Weekend! Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

FDA authorizes boosters of the Pfizer-BioNTech coronavirus vaccine for older adults and others at high risk from COVID-19

The hope is that booster shots will help protect those most at risk as the pandemic continues to rage. A nurse prepares to inject staff with the Pfizer/BioNTech coronavirus vaccine. Liam McBurney/PA Images via Getty Images The FDA authorized boosters of the Pfizer-BioNTech coronavirus vaccine for older adults and people at higher risk. Booster shots are likely to be available in locations like pharmacies and clinics at no cost. The US is still struggling to convince many people to get their first doses of coronavirus vaccines. See more stories on Insider's business page. The US coronavirus booster-shot campaign has cleared a crucial hurdle.The Food and Drug Administration on Wednesday authorized booster doses of the Pfizer-BioNTech coronavirus vaccine for older adults and others at high risk from the pandemic. Boosters can be given starting six months after the first two doses of the shot. The agency said that getting a third shot is safe and can help increase protection against the disease.The FDA decision caps more than a month of messy debate over the US vaccination drive. In mid-August, a group of President Joe Biden's top health officials issued an extraordinary joint statement saying that boosters were coming. The statement prompted controversy because it came before reviews by the FDA and the Centers for Disease Control and Prevention, and before much data on the safety or effectiveness of boosters was available. The US has already greenlit an extra vaccine dose for people with compromised immune systems, and some countries have embarked on booster-shot campaigns focused on vulnerable individuals.Under the FDA's emergency-use authorization, four main groups of people are eligible for booster shots:People 65 and older;People 18 to 64 who are at high risk of a severe case of COVID-19 if they get sick;People 18 to 64 who are at higher risk of getting COVID-19 at work, such as healthcare workers and teachers;People 18 to 64 who are at higher risk of getting COVID-19 because of where they live, such as those in prisons and other institutions.Protecting the most vulnerable amid the pandemicThe hope is that booster shots will help protect those most at risk as the pandemic continues to surge, fueled by the rise of the Delta variant. Delta is more contagious, and appears to be able to partially elude the protection offered by vaccines.Still, the US is struggling to convince much of its population to get coronavirus vaccines at all. Just over 64% of people 12 and older are fully vaccinated, according to the CDC."At this moment, it is clear that the unvaccinated are driving transmission in the United States," Dr. Amanda Cohn from the CDC said during an FDA meeting on boosters shots on Friday. Cohn said that masks and social distancing are still crucial, because "vaccination will never be perfect" at preventing every case.The CDC still needs to weigh in formally on who should be prioritized to receive booster doses. The agency's vaccine advisory committee is set to discuss booster shots on Thursday. Interim FDA Commissioner Janet Woodcock. Tom Williams/Getty Images The Biden administration has said that once approved, booster shots will be widely available in locations like pharmacies and clinics. They'll be offered to individuals for free.Expanding the reach of boostersThe FDA decision is a setback for Pfizer, which had asked the agency to make boosters available to everyone over age 16, six months after their second dose.It comes after a panel of doctors and other experts advising the FDA voted against the idea of making booster shots available that widely. The panel instead said that boosters should be given to people 65 and older, and to those most at risk of severe cases of COVID-19.Experts on the panel said there wasn't enough evidence showing the benefits of an extra vaccine dose for younger people. They also expressed concern that there wasn't enough safety data for younger adults, highlighting the risk of myocarditis, or heart inflammation, that has been seen at higher-than-usual levels in teenagers and 20-somethings who have been vaccinated."The incremental benefit to the younger population really has not been demonstrated at all," Dr. Michael Kurilla, an infectious disease expert from the National Institutes of Health, said during the meeting."I think we need to target the boosters right now specifically to the people who are likely to be at high risk, and it's an older population." 'A good step to protect yourself'Infectious-disease experts who aren't on the FDA's committee said the group made the right call to limit the initial rollout to more vulnerable people."If you fall into the age category, this is a good step to protect yourself," said Gigi Gronvall, an immunologist and senior scholar at the Johns Hopkins Center for Health Security.The booster rollout shouldn't distract from effort to get more unvaccinated people to get their initial shots, said Bernadette Boden-Albala, director of the University of California, Irvine's public-health program. "If you're not vaccinated, get vaccinated," Boden-Albala said. "If you are vaccinated, be vigilant. And if you're vaccinated and eligible for the booster, get it."The FDA still has plenty of work ahead on coronavirus vaccines. The agency is reviewing an application from Moderna to give a third shot of its two-dose vaccine. Johnson & Johnson recently put out data showing that its vaccine is more effective after a second dose, and said it'd provided the information to the FDA.The agency is also being pressed to make vaccines available to younger kids. Pfizer has said it plans to submit data from a study of kids ages 5 to 11 to FDA in early October, and the agency could reach a decision by the end of that month. The drugmaker then plans to submit data from kids between 6 months and 5 years old in November. Kathrin Jansen, Pfizer's head of vaccine research and development Pfizer The case for boostersTo make the case for booster shots, Pfizer presented results from at least eight studies showing protection from the vaccine wanes over time and that a booster could help. The company also cited data from Israel that showed big benefits from boosters in older people. That data comes from an observational study and could be skewed by factors that researchers weren't aware of or couldn't account for.The FDA's own review of the evidence for extra shots avoided taking a firm stance on some of the largest questions surrounding boosters, and noted that Pfizer didn't formally evaluate the efficacy of boosters.In a statement on Friday, Pfizer said that it believes booster shots are "a critical tool in the ongoing effort to control the spread of this virus.""We continue to believe in the benefits of a booster dose for a broader population," Kathrin Jansen, Pfizer's head of vaccine research & development, said in the statement.Read the original article on Business Insider.....»»

Category: topSource: businessinsider17 hr. 22 min. ago

Sens McConnell, Shelby Offer Short-Term Govt. Funding Bill Without Debt Ceiling

Sens McConnell, Shelby Offer Short-Term Govt. Funding Bill Without Debt Ceiling Authored by Katabella Roberts via The Epoch Times, Senate Minority Leader Mitch McConnell (R-Ky.) and Sen. Richard Shelby (R-Ala.) on Sept. 21 offered a competing short-term government funding bill, just as House Democrats passed a stopgap measure that also suspends the debt limit until after the 2022 election. The bill from McConnell and Shelby does not include a debt ceiling suspension, as Republicans have urged Democrats—the majority party—to raise the $28.4 trillion debt ceiling themselves through reconciliation, a special parliamentary procedure that would expedite the passage of a budgetary measure through the Senate. [ZH: The introduction of the bill likely increases the probability of no Senate deal, and for now, the market is tending to agree as debt ceiling anxiety has not eased at all] Through reconciliation, Democrats would be able to bypass the need for 60 votes to approve legislation, and instead rely on a simple majority in the Senate. But Democrats have resisted doing that so far, saying the vote to raise the debt limit should be a bipartisan one. “I am pleased to introduce a package with Leader McConnell that would extend government funding, provide much-needed disaster relief, and deliver targeted Afghan assistance. Republicans and Democrats have undergone bipartisan, bicameral negotiations for weeks to keep the government open and provide emergency aid. This bill reflects those urgent priorities,” Shelby said in a statement. Sen. Richard Shelby (R-Ala.) walks through the basement of the U.S. Capitol Building in Washington, on Aug. 10, 2021. (Samuel Corum/Getty Images) “Importantly, our legislation includes funding for the Iron Dome, making good on our commitment to a historic and significant ally, and removes the Democrats’ ill-conceived language on the debt limit. Members on both sides of the aisle can support this measure, and I urge them to do so with haste,” he added. Similar to the Democrats’ bill, the legislation from McConnell and Shelby would also keep the government funded through Dec. 3. It also includes resources for disaster aid and assistance for Afghan allies, as well as funding for the Iron Dome, Israel’s defense system. The Republicans senators said the funding for the Iron Dome would “bolster Israel’s defense capacity and protect against Hamas attacks.” On Tuesday, House Democrats removed $1 billion in funding for the Dome from their bill, amid accusations of human rights abuses within the Israel’s military and its treatment towards Palestinians. An Israeli soldier lies on the ground as missiles are fired from an Iron Dome anti-missile station near the city of Beer Sheva, Israel on Nov. 15, 2012. (Ilia Yefimovich/Getty Images) The latest GOP legislation comes after The House of Representatives voted late Tuesday to pass a bill that would avert a government shutdown or U.S. default, fund it through Dec. 3 and suspend the debt limit through Dec. 16, 2022. The 220–211 vote in the Democrat-majority chamber was on party lines. However, the bill now faces a tough hurdle in the Senate, where Republicans have said they would mount a filibuster. Speaking to reporters at a press conference on Tuesday, McConnell reiterated that Republicans were willing to support a short-term government funding bill if it included funding support for the Iron Dome, as well as assistance for Louisiana, which has been left debilitated by hurricane Ida in recent weeks. “We’re prepared to support a continuing resolution with assistance for Louisiana, with additional funds to replenish Iron Dome,” McConnell said, reported The Hill. “What we’re not prepared to do is to relieve the Democratic president, Democratic House, Democratic Senate from their governing obligation to address the debt ceiling,” he added. Congress must pass a funding plan by Sept. 30 to avert a government shutdown or U.S. default. The extra time will allow lawmakers to negotiate on the budget for the coming year. The current debt ceiling has already been breached, with debt at $28.78 trillion. It is being temporarily financed through the Treasury Department’s “extraordinary measures,” which it expects will be exhausted by October. Tyler Durden Wed, 09/22/2021 - 08:11.....»»

Category: blogSource: zerohedgeSep 22nd, 2021

Rabobank: Socialism For The Rich And Socialism For The Poor Is The Reality For Us And For Markets

Rabobank: Socialism For The Rich And Socialism For The Poor Is The Reality For Us And For Markets By Michael Every of Rabobank Socialism for the rich / Socialism for the poor US President Biden just spoke at the UN General Assembly, promised no Cold War, and offered nothing but international cooperation: French President Macron deliberately wasn’t there to hear it. China’s Xi Jinping stated all disputes should be handled with “dialogue and cooperation”, and pledged to stop funding offshore coal projects. That’s as nuclear subs and threatened nuclear strikes are the week’s other global stories. When do shoes get bashed on desks, and by whom? This is all as the Wall Street Journal’s Lingling Wei argues “Xi Jinping aims to rein in Chinese capitalism, hew to Mao’s socialist vision”, echoing what I have been argued --again-- in “Profound or profund revolution?”, which explains the ideological roots of the new policy of ‘common prosperity’. Except Lingling has key quotes from people ‘in the room’, where all the elephants are for markets. Here are just some of the highlights: “The Chinese President is not just trying to rein in a few big tech and other companies and show who is boss in China. He is trying to roll back China’s decades-long evolution toward Western-style capitalism and put the country on a different path entirely, a close examination of Mr. Xi’s writings and his discussions with party officials, and interviews with people involved in policy making, show. In Mr. Xi’s opinion, private capital now has been allowed to run amok, menacing the party’s legitimacy, officials familiar with his priorities say. The Wall Street Journal examination shows he is trying forcefully to get China back to the vision of Mao Zedong, who saw capitalism as a transitory phase on the road to socialism. Mr. Xi isn’t planning to eradicate market forces, the Journal examination indicates. But he appears to want a state in which the party does more to steer flows of money, sets tighter parameters for entrepreneurs and investors and their ability to make profits, and exercises even more control over the economy than now. In essence, this suggests that he aims to rewrite the rules of business in what could someday be the world’s biggest economy….the government would have a level of control that would allow it to steer the economy and industry along a path of its choosing, and channel private resources into strengthening state power…."Supervision over foreign capital will be strengthened," said a person familiar with the thinking at China’s top markets regulator.”” Yet I doubt even *that* is clear enough for The Street to understand. Portfolio managers who have been confronted with the above evidence are saying: “I missed the chance to sell last week but we are lower now, so I will stay long.”; “This is a buying opportunity.”; and “It’s behind us, time to buy.” None have read a word of Marx, even after being shown it provides a guide to what happens next, and they don’t plan to. All they need do is not underperform the market and fail conventionally, “because whocouldanooed?” We will no doubt also have US-based billionaires and funds, like a hypothetical ‘Day Rallio’ or ‘Whitepebble’, telling us to go longer Chinese assets, or extolling the virtues of this system. And there are things to extoll: socialism for the poor at least aims to help those who are left behind, and recognizes unregulated markets end up in monopoly or oligopoly and exploitation. Yet that is not what they are selling, but high returns, when China is making clear returns will be low, and only in some sectors at all. If you want a *logical* argument to go long Chinese assets, surely first one needs to have a view on the efficacy of a state-controlled economic model, in the same way one should believe in the tech of a start-up bringing an app to market? Then one needs to accept that it means the equivalent of the low-return-but-safe equivalent of what used to be government bond yields before the failure of free-market capitalism meant we have to pay governments to let us hold their debt. Even that overlooks the longer-run FX down-side risks and the whole Cold War backdrop. Meanwhile, the great joke is that this debate --where there is any-- is taking place against the backdrop of the upcoming Fed policy decision. Markets are on tenterhooks to find out if the FOMC will flag a timetable for the partial removal of the $120bn in QE liquidity it provides to the markets every month, while talking about inequality. In other words, socialism for the rich. The removal of that would be truly revolutionary in the eyes of many, as we are about to undergo another dot-plot Rorschach test.  . Meanwhile, economist Ann Pettifor on central banks points out what will happen when the internal contradictions of our system finally become too great for it to bear: “Fifty years ago, a US president closed the gold window, ended capital controls, and launched a new era of globalized finance. The “Nixon Shock” reshaped the international monetary system overnight, and then gradually changed the status of central bankers. Instead of acting as servants of the domestic economy, monetary policymakers have become masters of the globalized and financialized world economy…Central bankers’ status and constitutional role is therefore primarily a democratic question, not an economic or technical one.” Does this point to higher yields or lower yields ahead? The apparatchiks are already in place in places (and winter palaces), it seems, as “SEC’s Gensler likens stablecoins to 'poker chips’ amid call for tougher crypto regulation”. Gensler is quoted as saying: “History tells us that private forms of money don’t last long,” noting the US experimented with private money in the “wildcat banking era” from the 1830s to the 1860s, which “all had a lot of cost, a lot of problems.” Perhaps time to check if you are holding any NFTs of kulaks? (And meanwhile, Zoom’s $15bn bid for Five9 is under review; the US says it is likely to keep Huawei on its blacklist; and the State Department is reported to be massively expanding its footprint on China, with dozens of new officers in DC and at global embassies to monitor it at all times. No Cold War. All cooperation.) More and more, I am told that what I am talking of here is ‘too much’ for individual market participants to take in or deal with. They want to look at lines on screens; chase spot and ticks; play ‘The Price is Right’, and clock off at 5pm; do the same old deals; or put up stickers saying: “Workers of the world, unite!” or “Don’t tread on me”. We all like to look at the smallest changes in 10-year US bond yields all the time - yet heaven forfend if we have to think about what the world will look like in 10 years’ time! Regardless, socialism for the rich and --or vs-- socialism for the poor is the underlying reality for us and for markets. It may be awkward, or complicated, or involve more thinking than usual about how to trade it properly, but it remains true. On which note, allow me to conclude with an old joke about clashing political ideologies: “Under capitalism, man exploits his fellow man. Under communism, everything is reversed!” Tyler Durden Wed, 09/22/2021 - 09:45.....»»

Category: blogSource: zerohedgeSep 22nd, 2021

The U.S. Is Losing the Global Race to Decide the Future of Money—and It Could Doom the Almighty Dollar

"I don’t think the U.S. is aware there is a race" In cities across China, the country’s central bank has begun rolling out the e-renminbi—an all-digital version of its paper currency that can be accessed and accepted by merchants and consumers without an internet connection, credit or even a bank account. Already having conducted more than $5 billion in e-renminbi transactions, China has opened its digital currency up to foreigners. Next year, when Beijing hosts the Winter Olympic Games, authorities are expecting to let the world test drive its technological achievement. The U.S., by contrast, is having trouble even concluding its multi-year exploration into the possibility of an e-dollar. In fact, an upcoming Federal Reserve paper on a potential U.S. digital currency won’t take a position on whether the central bank of the United States will, or even should, create one. [time-brightcove not-tgx=”true”] Instead, Federal Reserve Chair Jerome Powell said in recent testimony to Congress, this paper will “begin a major public consultation on central bank digital currencies…” (Once planned for July, the paper’s release has since been moved to September.) Once the world leader in digital payments and technological innovation, the U.S. is being outpaced by its top global adversary as well as much of the industrialized and the developing world. The Bahamas recently announced the integration of its digital Sand Dollar into a stock exchange, while Australia, Malaysia, Singapore and South Africa are moving forward with the world’s first cross-border central bank digital currency exchange program led by the Bank for International Settlements (BIS), which is known as the central bank of central banks. Such developments have been somewhat outshined by El Salvador’s recent decision to make bitcoin a legally accepted currency, which few expect to make significant impact in the payment space. But outside of the cryptocurrency space, nations around the globe are making significant strides in the development of the digital future of money — supported by governments and backed by powerful central banks. Leadership in this space will have implications for more than just payments: geopolitical ambitions, economic growth, financial inclusion and the very nature of money could all be dictated by who leads the charge and how. “I don’t think the U.S. is aware there is a race” Digital currencies are the next wave in the “evolution of the nature of money in the digital economy,” Hyun Song Shin, economic adviser and co-leader of the Monetary and Economic Department at the Bank for International Settlements, tells TIME. As more of our world migrates from physical brick-and-mortar to wireless and cloud-based, the way we pay for things is changing as well. A central bank digital currency would operate just like cash, but instead of having to carry it in a physical wallet or put it into a bank account, it would be stored and accessed digitally. Not only could U.S.-backed digital currency facilitate easier, modern banking, it could prove vital in protecting American international influence. Late to the party, the U.S. is “stepping up its research and public engagement” on digital currencies, the Federal Reserve says, including forming working groups on cryptocurrency and other kinds of digital money, and experimenting with technology that would be central to producing a digital dollar. The Fed’s regional Boston branch is overseeing these efforts with the Massachusetts Institute of Technology on what’s known as Project Hamilton. But the path towards a digital U.S. dollar has met many challenges, skeptics and outright opponents. All while China, and other countries, push forward. Lagging behind the world Just how far behind is the U.S. in the development of a central bank-issued digital currency (CBDC)? According to global accounting firm PwC’s inaugural CBDC global index, which tracks various CBDCs’ project status from research to development and production, the U.S. ranks 18th in the world. America’s potential efforts trail countries like Sweden, South Korea and China but also countries like the Bahamas, Ecuador, Eastern Caribbean and Turkey. China, with its government’s hyperfocus on maintaining control and overseeing data, has been working to develop a CBDC for almost a decade. And the U.S. is probably not close to catching up. Analysts like Harvard economics professor Kenneth Rogoff, who study monetary policy and digital currencies, estimate that the U.S. could be at least a decade away from issuing a digital dollar backed by the Fed. In that time, Rogoff argued in an op-ed earlier this year, the modernization of China’s financial markets and reduction or removal of its currency controls “could deal the dollar’s status a painful blow.” Read More: How China’s Digital Currency Could Challenge the Almighty Dollar China has already largely moved away from coin and paper currency; Chinese consumers have racked up more than $41 trillion in mobile transactions, according to a recent research paper from the Brookings Institution, with the lion’s share (92%) going through digital payment processors WeChat Pay and Alipay. “The reason you could say the U.S. is behind in the digital currency race is I don’t think the U.S. is aware there is a race,” Yaya Fanusie, an Adjunct Senior Fellow at the Center for a New American Security, and a former CIA analyst, tells TIME in an interview. “A lot of policymakers are looking at it and concerned…but even with that I just don’t think there’s this sense of urgency because the risk from China is not an immediate threat.” Not only is the U.S. running significantly behind in the development of a CBDC, we are trailing the rest of the world in digital payments broadly. Kenya, for example, has almost fully digitized its economy through its digital currency and payment system MPESA, making transactions free and almost instantaneous. India’s Unified Payments Interface (UPI) allows users to transfer money instantly between bank accounts with no cost. Brazil’s PIX facilitates the transfer of money between people and companies in up to 10 seconds. All of these programs work through and are overseen by the countries’ central banks rather than commercial banks or other private companies. What’s holding the U.S. back? Critics argue CBDCs are simply a solution in search of a problem and potentially harmful. Many see support from the banking sector as vital to the success of a digital U.S. dollar, however commercial banks in the U.S. have taken a largely adversarial stance. “The proposed benefits of CBDCs to international competitiveness and financial inclusion are theoretical, difficult to measure and may be elusive,” the American Bankers Association said in a statement at a recent congressional hearing on digital currencies. “While the negative consequences for monetary policy, financial stability, financial intermediation, the payments system, and the customers and communities that banks serve could be severe.” The Bank Policy Institute, which lobbies on behalf of the country’s largest banks, went so far as to argue that neither the Fed nor the U.S. Treasury even has the constitutional authority to issue a digital currency. Commercial banks dominate the U.S. financial system to such a degree that unraveling them would be ostensibly impossible, experts say, they also would be a powerful adversary. Former Goldman Sachs managing director Nomi Prins notes banks have clearly seen the writing on the wall. “Banks are centralized middlemen with respect to financial transactions,” Prins, author of Collusion: How Central Bankers Rigged The World, tells TIME. “The more popular cryptocurrency or digital currency becomes, the fewer profits the banking system can reap from traditional services and verification methods that allow them to hold, take or use their customers’ money, and the more financial power they stand to lose as a result.” Even disruptive financial technologies like PayPal, Venmo and Zelle work through the banking system, rather than around it, thanks in large part to the banks’ power. Central bankers also generally have concluded that commercial banks are a necessary piece of a potential CBDC ecosystem, thanks to their pre-existing regulatory guardrails and ability to move money. Read More: How Jay Powell’s Coronavirus Response Is Changing the Fed Forever Top policymakers at the Fed, including influential Vice Chair for Supervision Randal Quarles, have joined the banking industry in arguing that a digital dollar “could pose significant and concrete risks” and that the potential benefits “are unclear.” Fed Governor Christopher Waller said in August he was “skeptical that a Federal Reserve CBDC would solve any major problem confronting the U.S. payment system,” in a recent speech he titled “CBDC: A Solution in Search of a Problem?” Further, there’s no central U.S. authority with direct oversight or responsibility for any of this. In addition to the Fed, the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Federal Trade Commission, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, Office of Thrift Supervision, Financial Stability Oversight Council, Federal Financial Institutions Examination Council and the Office of Financial Research would all have some stake in the development of a digital currency backed by the central bank, to say nothing of state and regional authorities. “The U.S. has an active congressional debate, which is beneficial and very important,” Federal Reserve Governor Lael Brainard tells TIME in an interview. “But the U.S. also has a diffusion of regulatory responsibility with no single payments regulator at the federal level, which is not as helpful. That diffusion of responsibility is part of what creates the lags that our system is working through.” None of this exists in China where the Chinese Communist Party oversees the central bank, commercial banks and their regulators and is unconcerned with privacy. How a downgraded dollar could hamstring U.S. influence An American CBDC could have lasting geopolitical impact and curb a longstanding international effort to reduce reliance on the mighty U.S. dollar. “Why we should care about this is that the U.S. financial system is not intrinsically dominant,” Fanusie says. “Other countries, both allies and adversaries, are sincerely interested in finding ways to decrease their dependence on the dollar.” With the U.S. dollar as the world’s reserve and primary funding currency, the U.S. can restrict access to funding from financial markets, limit countries’ ability to sell their natural resources and hinder or block individuals’ access to the banking sector. “Other countries, both allies and adversaries, are sincerely interested in finding ways to decrease their dependence on the dollar” While dollar dominance has rankled much of the world for decades, there has been no suitable replacement for the U.S., with its massive economy, sophisticated banking system and sprawling international presence. China is in the midst of a long-term push to simultaneously grow its financial markets and internationalize its currency. Both have the end goal of allowing China and its allies to limit the ability of the U.S. to enforce its will through economic actions like sanctions. Fanusie wrote in a January report that being the first major economy to roll out a digital currency is “part of China’s geopolitical ambitions.” However, the renminbi will not become the world’s reserve currency — at least, not any time soon. But what China has done by being in the forefront of CBDC development is put itself in position to take the lead on development and implementation of rules and regulations for digital currencies on a global scale. “While America led the global revolution in payments half a century ago with magnetic striped credit and debit cards, China is leading the new revolution in digital payments,” writes Brookings’ economic studies fellow Aaron Klein. Why should central banks offer digital currencies? Over the past decade, digital currencies, including cryptocurrency and “stablecoins,” have sprung up like weeds. Some purport to be just as safe as dollars, but are backed by questionable assets. In a crisis regulators worry they could fluctuate wildly in value or lose their value altogether. Having central banks, which are responsible for the printing and circulation of coins and paper money, issue digital currencies is in part a reaction to this private sector activity, Shin says, “accelerated by the potential encroachment of private digital currencies, and the need to preserve the role of money as a public good.” “The status quo is not an option” Notably, a U.S. digital currency could provide benefits to everyday people. It could increase financial inclusion and fix flaws in current payments systems, Shin adds, citing findings of a recent BIS study. For example, transferring money between U.S.-based bank accounts, even those held by the same person, can take days. The process can be even longer when crossing international borders. Credit and debit card transactions similarly don’t settle for days and come with significant fees for merchants, who sometimes pass them on to customers. CBDCs could grant universal access to the banking sector and quickly facilitate the distribution of paychecks and government funds, reducing the need for costly bank workarounds like check cashing and payday loans. Championing CBDCs Brainard has been pushing the Fed to move on a digital currency for years, but there was little urgency from others at the Fed or in Congress. Companies developing their own currencies, consumers investing in cryptocurrency and the COVID-19 pandemic making paper notes anathema to many Americans changed that. Before COVID-19, Facebook’s Libra project (now known as Diem) showed lawmakers and central bankers the potential for a private company to step in and fill the void by effectively minting its own currency that could be spent by users around the world. “The status quo is not an option,” Diem co-creator David Marcus said at the International Monetary Fund’s 2019 fall meeting. “Whether it’s Libra or something else, the world is going to change in a profound way.” Brainard, for one, has taken notice. “My own thinking is that stablecoins and related private sector initiatives are moving very rapidly, which makes it incumbent on us to move more rapidly,” she tells TIME. “That is why I have been pushing to advance outreach, cross-border engagement, and policy and technology research for several years now.” So-called stablecoins — unregulated digital currencies created by private companies that purport to represent dollars but are completely unregulated — have become a significant worry for lawmakers and shown the importance of considering tying currency to a central bank. “It’s getting harder and harder for community banks to compete for new customers when big tech companies can afford to spend billions on marketing and technology,” Sen. Sherrod Brown, who chairs the Senate Banking Committee, tells TIME. “But many of these new ‘fintech’ products don’t come with the consumer protections, federal backing or customer service and relationships with the community that small banks and credit unions provide.” During a hearing on digital currencies in June, Sen. Elizabeth Warren, the ranking member of the Subcommittee on Financial Institutions and Consumer Protection, compared stablecoins to worthless “wildcat notes” that were issued by speculators in the 19th century. Her expert at that hearing, Lev Menand, an Academic Fellow and Lecturer in Law at Columbia Law School, went further in his testimony, calling stablecoins “dangerous to both their users and … to the broader financial system.” With private companies pushing deeper into the digital currency space, rival countries seeking to seize leadership and a public that is moving further away from physical currency, the U.S. is facing a world in which it may not control or even lead the world’s payment systems. That would make the future of money look very different from the past......»»

Category: topSource: timeSep 21st, 2021

Flood and Disaster Disclosures: Law, Precedent and Grades for All 50 States

As more and more climate change-fueled extreme weather events—from historic hurricanes to unexpected summer downpours—affect homes, one issue anyone selling or buying a home needs to be aware of is disclosure. While some states require a seller to expansively detail any history of flood damage, flood zone designation or other natural disaster threats, others have […] The post Flood and Disaster Disclosures: Law, Precedent and Grades for All 50 States appeared first on RISMedia. As more and more climate change-fueled extreme weather events—from historic hurricanes to unexpected summer downpours—affect homes, one issue anyone selling or buying a home needs to be aware of is disclosure. While some states require a seller to expansively detail any history of flood damage, flood zone designation or other natural disaster threats, others have little or no disclosure requirements or provide only vague guidelines on what needs to be disclosed A recent Federal Emergency Management Agency (FEMA) panel rated all 50 states on the transparency of their flood disclosure policies on a letter grade from “A” for very transparent to “F” for failing to provide adequate policies or guidance. With 21 states receiving an “F” grade, the FEMA panel recommended the creation of a nationwide database of flood events, flood insurance claims and disaster claims. Though most local REALTOR® associations offer a voluntary form which can be provided to clients—all of which include some flood or disaster disclosures—every real estate professional should be aware of the legal requirements and precedents around flood and disaster disclosure in their state. ALABAMA — GRADE: F Alabama has no statutory or regulatory requirements for disclosure of flood risk, federal flood insurance requirements or past flood damages. Sellers must disclose a “material defect or condition that affects health or safety [when] the defect is not known to or readily observable by the buyer,” and a jury found in the 2000 court case Cooper & Co. v. Lester that this applies to “misrepresentations and suppression of material facts” related to flooding. ALASKA — GRADE: C Sellers in Alaska must disclose the flood zone designation and any floods they are aware of on the property, as well as damage caused from “landslide, avalanche, high winds, fire, earthquake or other natural causes.” It also requires that sellers disclose water or leakage in the basement along with frozen pipes or drains. ARIZONA — GRADE: F Arizona state statute requires licensed real estate agents to notify buyers through a written affidavit whether or not the property is on a FEMA-designated floodplain. Arizona also offers a list of other items to disclose, including fissures and environmental hazards affecting, but this report is explicitly not mandatory. Licensed real estate agents must also disclose any water that is a “feature” of the property, and whether it fluctuates “substantially in size or volume.” The in the 2011 court case Barton v. Boesen ruled that a real estate agent and his brokerage could not be held responsible for selling a new house with a defective, regularly leaking foundation because the buyers could not prove he “knew or should have known any information about the construction of the home.” ARKANSAS — GRADE: F Arkansas’s real estate commission explicitly states that no state law requires disclosure of specific information about their property, including floods and natural disasters. However, licensed real estate agents have to make “reasonable efforts” to obtain and disclose information that is “material to the value or desirability” of the property. In the 2011 court case Worley v City of Jonesboro, buyers sued a seller and her brokerage for allegedly understating flooding issues ruled in favor of the seller, with a judge saying that sellers can only be held responsible for nondisclosure in “special circumstances” when they have knowledge a buyer is relying on incorrect or misleading information in a transaction. CALIFORNIA — GRADE: C California has a specific and detailed mandatory form that statutorily requires property sellers to disclose a variety of past damages or potential future hazards, including major flood damage, flood zones, historic forest fire risk and earthquake fault lines. Whether or not a property will require flood insurance does not need to be disclosed. Two new laws passed in 2021 also require sellers to disclose certain fire hazard risks, including any fire hazard zone the property is part of and specific mitigation steps taken to defend against wildfires—everything from ember-resistant roof vents to non-combustible landscaping buffer zones. COLORADO — GRADE: F Real estate brokers are required by the state Department of Regulatory Agencies (DRE) to use state-approved disclosure forms “when appropriate.” While certain disclosures are codified in state law, disaster disclosure—whether a property has been damaged by “hail, wind, fire, flood or other casualty”— is not. The DRE vaguely warns on its website that real estate brokers are “responsible to make all required disclosures to all parties under applicable laws, rules and regulations governing real estate brokers.” In Jehly v. Brown, a 2014 court case involving buyers who were not informed their newly constructed house was built in a floodplain, saw a judge rule in favor of the seller (who did not fill out the disaster disclosure form) despite the fact that the third-party builder of the home knew about the floodplain. CONNECTICUT — GRADE: D Connecticut requires by law that sellers disclose flood hazard and inland wetland designations along with fire and smoke damage, but does not mandate anything regarding past flooding events or damage, or whether flood insurance is required on that property. DELAWARE — GRADE: C Delaware has a mandatory seller disclosure form that includes flood damage, drainage problems and flood zone or wetland designations. Flood insurance, and the current annual premium cost, must also be disclosed when applicable. The state also requires sellers to disclose if the property owner is responsible for repairing nearby streets or sidewalks, and the estimated cost if they are. DISTRICT OF COLUMBIA — GRADE: C The district does have a mandatory disclosure form that asks if there are any exterior drainage problems or if there has been previous flood, fire or wind damage to a property. There are no requirements to disclose flood insurance or floodplain designations. FLORIDA — GRADE: F While Florida has no statutory requirements regarding flood or disaster disclosure, courts have sometimes found that sellers can be held liable for not disclosing “facts or conditions about the property that could have a substantial impact on its value or desirability.” In the 1985 court decision in Johnson v. Davis, a seller was held responsible for not disclosing that a window regularly “gushed” water during rainstorms after they had told the buyer leaking issues had been mitigated, with the judge saying that enough omissions or misrepresentations by sellers could “amount to fraud in the legal sense.” On the other hand, a 1997 decision in Nelson v. Wiggs ruled in favor of a seller who had not disclosed regular property flooding, faulting the buyers for not asking questions of the seller or doing their own research. GEORGIA — GRADE: F Georgia has no codified or statutory mandatory disclosures for flooding. A 2010 appeals court ruling in Shaw v. Robertson faulted a homebuyer and their agent after they discovered significant flooding on a newly-purchased property, saying they “failed to act diligently” by doing more research or observing land conditions before making an offer. HAWAII — GRADE: D Sellers in Hawaii must disclose if a property is in a flood hazard area, but not any flood damage or flood insurance requirements. A mandatory form also asks sellers to disclose “material facts” that “are within the knowledge or control of the seller” or “can be observed from visible, accessible areas,” though how and when this would include flood damage or other natural disaster concerns is not defined. IDAHO — GRADE: F Idaho does not have disclosures for flood damage, flood zones or flood insurance, though a mandatory form does ask if there are “specific problems” with drainage or basement water. That form also has a space requiring “legal, physical, or other” disclosures, though it is not clear if flooding would be included. A 1997 court ruling in Enright v. Jonassen held a seller partially responsible after he failed to disclose a floodplain designation after he was asked explicitly by the buyer about additional building restrictions on the property. ILLINOIS — GRADE: C Sellers must disclose in Illinois whether there has been flooding or leaking in a basement, or whether it is located in a flood plain or currently has flood insurance. Sellers must also disclose if the property has “earth stability defects.” Licensed real estate agents must also disclose “latent material adverse facts pertaining to the physical condition of the property that are actually known by the licensee and that could not be discovered by a reasonably diligent inspection,” but cannot be held liable for passing on false information from a client if they did not have “actual knowledge the information was false.” INDIANA — GRADE: C Sellers in Indiana must disclose if there is any damage to the property due to “wind, flood, termites or rodents,” along with floodplain designations and current flood insurance. That mandatory form also includes “hazardous conditions,” including mine shafts or radioactive material on site. IOWA — GRADE: C Iowa does have mandatory disclosures, though how they are presented can vary. A recommended form requires sellers to disclose past flooding, drainage, grading issues, or floodplain designations, along with “water or other problems” in the basement or foundation. Iowa law specifically allows sellers to draw up their own disclosure form as long as it “contain[s] at a minimum the information required by” the recommended form, and complies generally with state statutes. NAR guidance warns that “no particular language is required provided all mandatory items are included” in a disclosure. KANSAS — GRADE: F Kansas generally requires that a seller discloses “[a]ny environmental hazards affecting the property which are required by law to be disclosed.” This does not explicitly mention flooding or any other natural disaster, though according to the National Association of REALTORS® (NAR), courts have provided some precedent that sellers can be held responsible for certain material omissions, which might include flooding. In the 2013 court case Stechschulte v. Jennings, which involved a seller who had misrepresented repairs he made to windows—leaving behind a can of paint expressly designed to conceal water damage that buyers discovered—the court ruled the seller could be held liable. The seller’s real estate agent, who was also his fiance could be held liable as well, the court ruled, even though she did not live in the home at the time and claimed she had no direct knowledge of leaks or flooding. KENTUCKY — GRADE: C Kentucky requires mandatory disclosure of “draining, flooding, or grading,” as well as its flood hazard designation and flood insurance. It also requires sellers to disclose nearby bodies of water adjoining the property. Kentucky also sets specific sanctions against licensed real estate agents who do not disclose these things, including revoking licenses and levying fines of up to $1,000. LOUISIANA — GRADE: A As a state that has seen some of the worst flooding disasters in recent memory, Louisiana’s disclosures are extensive. The state’s mandatory disclosure form includes any past “flooding, water intrusion, accumulation or drainage problem” as well as its nature and frequency. This information must be provided for every structure on the property, and explicitly includes the time period before the seller owned the property. Flood designations and hazard zones must be disclosed, and the seller must also provide the source and date for these designations—FEMA flood maps, surveys or other third-party oversight. Whether the property is in a wetland, or even has a pending wetland designation, must also be included in the form. Apart from floods, sellers must also disclose “property damage, including, but not limited to, fire, wind, hail, lightning,” that occurred both before and during the seller’s ownership of the property. MAINE — GRADE: F Maine has no mandatory disclosure form, and state statute simply states that that sellers “shall disclose in a timely manner to a prospective buyer all material defects pertaining to the physical condition of the property of which the seller agent knew or, acting in a reasonable manner, should have known” without mentioning floods. Seller’s agents are “not obligated to discover latent defects in the property,” and cannot be held liable if they pass on false information that was provided by a client. The 1999 court case Kezer v. Mark Stimson Assocs. held that sellers and their agents could not be held liable for failing to disclose neighborhood environmental hazards that had not significantly affected the property in question. MARYLAND — GRADE: D While Maryland does have a mandatory disclosure form, the only flood-related item asks if the property is located in a “flood zone, conservation area, wetland area, [or] Chesapeake Bay critical area.” The form also asks for the disclosure of “material defects,” though whether that applies to flooding or flood damage is not explicit. MASSACHUSETTS — GRADE: F State statute requires that a seller “disclose known material defects in real property” but provides no other guidance on floods and no mandatory form. In 2008, the Massachusetts Supreme Court case Grossman v. Pouy saw a seller leave blank sections on a voluntary disclosure form related to roof and other structural deficiencies when the roof needed to be immediately replaced and walls were filled with mold and rodents. The court in this case found that failure to disclose serious defects that rose to the level of fraud could render sellers liable. MICHIGAN — GRADE: C Michigan does have mandatory disclosures, including for flood insurance, drainage or grading issues, and any “major damage to the property from fire, wind, floods or landslides.” Interestingly, the state explicitly allows counties or towns to add their own additional forms or disclosures, meaning some areas have potentially more stringent flood disclosure requirements for sellers or their agents. MINNESOTA — GRADE: D Though Minnesota does not have a mandatory disclosure form, state statute requires that a licensed real estate agent “disclose to a prospective purchaser all material facts of which the licensee is aware, which could adversely and significantly affect an ordinary purchaser’s use or enjoyment of the property, or any intended use of the property of which the licensee is aware.” According to NAR, this would include flooding or flood damage. Ghost hunters, however, will be disappointed to learn that Minnesota explicitly exempts sellers from disclosing if there was any “perceived paranormal activity” on the property. MISSISSIPPI — GRADE: A Boasting one of the most comprehensive mandatory flood disclosure laws alongside Louisiana, Oklahoma, and Texas, Mississippi requires sellers to detail, including dates and descriptions, of “damage to any portion of the physical structure resulting from fire, windstorm, hail, tornados, hurricane or any other natural disaster.” Additionally, the form asks for any “malfunction or defects” with windows or other infrastructure related to leaking. Flood plan hazard designations, including the FEMA map number must be disclosed, as well as current flood insurance and the price of the current premium. If the property has experienced standing water in the yard for more than 48 yards after a rain, that must also be disclosed. Sellers must also detail any water damage regardless of source or reason, as well as steps taken to remedy those issues. MISSOURI — GRADE: F There are no mandatory flood disclosures or required forms in Missouri. Though licensed real estate agents must “disclose to any customer all adverse material facts actually known or that should have been known by the licensee,” they also “owe no duty to conduct an independent inspection or discover any adverse material facts for the benefit of the customer.” In Keefhaver v. Kimbrell—a 2001 court case in which a buyer accused a seller of understating flood risk and basement leaks—the court ruled in favor of the buyer, even though she had only spent 30 minutes on the property before making an offer and waived her right to an inspection. The buyer was entitled to rely on the seller’s representations, the court ruled, due to their superior knowledge of facts that were “latent and…not easily ascertainable.” MONTANA — GRADE: F Though there are no mandatory forms or disclosures required of sellers, Montana state statute dictates that sellers must disclose “adverse material facts,” and defines those as “a fact that should be recognized by a broker or salesperson as being of enough significance as to affect a person’s decision to enter into a contract to buy or sell real property.” At the same time, a licensed real estate agent must “ascertain all pertinent facts concerning each property in any transaction…so that the licensee may fulfill the obligation to avoid error, exaggeration, misrepresentation or concealment of pertinent facts.” A 2015 court ruling in Rutterud v. Gilbraith stated that that a real estate agent could not be held liable for failing to investigate a mold problem caused by known flooding under that law. NEBRASKA — GRADE: C State law requires sellers to provide a written statement that “substantially” follows the format of a standard disclosure form, which includes whether the property is in a flood hazard zone, a “floodway,” or if there are any “flooding, drainage or grading problems.” The law also requires disclosure of “adverse material facts,” which NAR states would likely include other flood or natural disaster related issues. NEVADA — GRADE: C Nevada requires a mandatory disclosure form for sellers that includes “previous or current moisture conditions and/or water damage,” along with “drainage, flooding, water seepage or high-water table.” Sellers must also disclose floodplain designations, along with “earth stability” and other landslide or earthquake-related issues. NEW HAMPSHIRE — GRADE: F The “Live Free or Die” state unsurprisingly has minimal requirements for seller disclosures around flooding. Real estate agents must disclose “material physical, regulatory, mechanical or on-site environmental condition[s] affecting the subject property of which the licensee has actual knowledge,” but the law explicitly states that it “shall not create an affirmative obligation on the part of the licensee to investigate material defects.” Snierson v. Scruton, a 2000 court Supreme Court Case, ruled that a seller who used a voluntary disclosure form could still be held liable for fraud and negligent misrepresentation over septic tank leaching, even though that form “expressly warned that it did not constitute a warranty and was not a substitute for a buyer’s inspection.” The buyer still had to prove, however, that the seller demonstrated “conscious indifference to [the] truth with the intention to cause another to rely upon it.” NEW JERSEY — GRADE: F New Jersey’s code requires licensed real estate agents to provide a disclosure form that includes whether the property has flood or drainage problems or is located in a flood hazard. Agents are also specifically empowered to add or request more disclosures when appropriate, and are exempted from liability if they made a “reasonable and diligent inquiry” to discover if information given to them by a seller was false. There is no requirement that unlicensed sellers provide this disclosure. The 1974 court case Weintraub v. Krobatsch held a seller and their agent responsible for not disclosing a cockroach infestation, which the FEMA panel posited could also apply to non-disclosure of flooding. NEW MEXICO — GRADE: F New Mexico requires licensed agents and brokers to disclose “any adverse material facts actually known by the associate broker or qualifying broker about the property or the transaction,” but makes no mention of flood or disasters and has no mandatory forms. A 1984 court ruling in Gouveia v. Citicorp Person-to-Person Fin. Ctr., Inc. determined a broker could be held liable in a case where a property was listed as “All Top Shape” despite the fact that parts of the home had no foundation, could not be heated and had other major structural deficiencies. In this case, the broker had not even interacted directly with the buyer, but had simply provided a description of the property to an MLS. NEW YORK — GRADE: F New York’s mandatory flood disclosure law has an odd loophole: the penalty for not including the disclosure form is a paltry $500 credit due at closing. Both NAR and FEMA found that many attorneys have advised home sellers to simply pay this penalty rather than disclose potentially deal-sinking information about standing water on the property, historic flooding issues or floodplain designations. A bill currently stalled in the state legislature would repeal the $500 penalty system and add significant new flood disclosure requirements. Simply paying the penalty, however, does not exempt a seller or agent from being held liable for “active concealment of a defect,” according to the 2018 court case Pesce v. Leimsider, in which a seller allegedly concealed water damage during a sale and inspection. Another court case in 2005 (Gabberty v Pisarz) in which a seller withheld information about chronic basement flooding ruled that a buyer can be awarded damages when there is a “willful failure” to disclose these things. NORTH CAROLINA — GRADE: D North Carolina does have a mandatory disclosure form that asks narrowly if the property is “subject to a flood hazard or…located in a federally-designated flood hazard area.” It also asks about water seepage or standing water in the basement, but does not require any disclosures related to flood damage or historic flooding. NORTH DAKOTA — GRADE: C State statute in North Dakota requires significant disclosures around flooding, including whether it was ever damaged by a flood, has drainage issues or is in a flood zone. It also asks whether the property has been “damaged by fire, smoke, wind, floods, hail, snow, frozen pipes or broken water line…condensation or ice buildup,” and requires explanations for those issues. A 1985 court case (Holcomb v. Zinke) also explicitly exempted certain real estate transactions from the “buyer beware” doctrine of common law, ruling that “passive concealment” by a seller could constitute fraud. OHIO — GRADE: C A mandatory Ohio disclosure form asks if there are previous or current water leaks, rain gutter issues, water accumulation, moisture, or other material damage related to flooding or any other water intrusion. Fire or smoke damage is also included, and any mitigation or repairs over the last five years to address these things must also be divulged. It also requires disclosure of historic flooding, as well as if the property is in a designated floodplain or Lake Erie Coastal Erosion Zone. OKLAHOMA — GRADE: A Any seller who has occupied a property in Oklahoma must fill out a mandatory disclosure form and must disclose a variety of specific flood zone designations, flood insurance, historic flooding and interior leakage or drainage issues. They must also disclose “major fire, tornado, hail, earthquake or wind damage.” An additional stipulation requires licensed real estate agents to disclose property defects they know of that are not stated on the seller’s disclosure form, and they can be disciplined by the state if they fail to do so. OREGON — GRADE: C Oregon has a mandatory form that must be proactively delivered to each person that makes an offer on a property. That disclosure includes whether there has been “material damage to the property or any of the structure from fire, wind, floods, beach movements, earthquake, expansive soils or landslides.” There are also questions as to floodplain designation or “geologic hazard zone.” There is no requirement to disclose flood insurance mandates, though the form does advise buyers that any floodplain designation could result in the need for insurance. PENNSYLVANIA — GRADE: C A mandatory form in Pennsylvania asks sellers about leaky roofs, basement leakage or dampness or repairs to mitigate those issues. It also requires floodplain disclosure, as well as past or present flooding issues affecting the property generally. RHODE ISLAND — GRADE: D Rhode Island mandates certain disclosures without providing a form. Among the required information is the vague directive that sellers include “Basement (Seepage, Leaks, Cracks, etc.)” along with “Flood Plain (Flood Insurance)” and  “Fire,” without further defining what any of this means. Location of nearby wetlands, or if the property is on wetlands, must also be disclosed. . A 2003 court ruling in Stebbins v. Wells, involving undisclosed severe erosion on a coastal property, stated that sellers and their agents could be held liable for “passive concealment” in some circumstances and explicitly pushed back against the “buyer beware” doctrine. SOUTH CAROLINA — GRADE: C South Carolina’s mandatory disclosure form includes specific statutory language requiring sellers to report flood problems, flood hazards or designations, all FEMA claims and the dates they were filed, as well as current flood insurance. Fire, smoke or other water “problems” must be divulged as well. It also requires a real estate agent to disclose known “adverse facts” about the property even if the seller omitted them. South Carolina also explicitly allows waiving all these disclosure requirements as long as both parties agree to do so in writing. Certain time-sharing and vacation home plans are also exempt from disclosure. SOUTH DAKOTA — GRADE: C South Dakota has a mandatory disclosure form laid out in state statute that includes “water penetration” issues, standing water on the property, roof leaks and any water damage that was repaired or not repaired. Sellers must also disclose previous flood insurance claims made on the property. TENNESSEE — GRADE: B Tennessee offers a disclosure form that is technically not mandatory, but state statute warns that any real estate transaction must include all items and provisions laid out in that form. Those items and provisions include “flooding, drainage, or grading problems,” flood insurance requirements, and property damage from fire, earthquakes, floods or landslides, as well as if that damage has been repaired. Sellers must also disclose any recent surveys conducted of the property, which could include information about flooding or flood risk. TEXAS — GRADE: A A state that has seen more than its share of flooding and disasters, Texas’s disclosure laws require comprehensive declarations regarding flooding and other adverse natural events. Water damage, fire damage, flooding from a “controlled or emergency release” of a reservoir, or from natural flood event, and six specific floodplain designations must all be disclosed by law. Sellers must also divulge current flood insurance and past flood insurance claims. Additionally, the law explicitly allows a buyer to terminate a contract if the seller does not provide the mandatory disclosures when entering into a purchase agreement. UTAH — GRADE: F With no flood or mandatory disclosure rules, Utah only generally asks real estate agents to divulge “known material facts” regarding “a defect in the property.” A 2002 court case involving a real estate agent who was selling property owned by her husband found that the agent and her brokerage were liable for failing to disclose “chocolate pudding-like” mud that made the land untenable for development. VERMONT — GRADE: F There are no mandatory flood disclosure forms or requirements in Vermont. A state statute regarding “unprofessional conduct” by licensed real estate agents allows the state to discipline those who fail “to fully disclose…all material facts within the licensee’s knowledge concerning the property being sold.” A 1998 court case (Carter v. Gugliuzzi) held a seller’s brokerage responsible for failing to disclose regular dangerous wind on a property, even though the broker was only aware of this fact because he happened to live in the area. VIRGINIA — GRADE: F The FEMA panel excoriated Virginia’s flood disclosure laws as “the opposite of buyer friendly.” While the state does have a mandatory disclosure form, that form explicitly exonerates the seller from disclosing flood-related items and warns the buyer to “exercise whatever due diligence they deem necessary” to learn about flood risks, flooding or flood designations on the property. An update to the relevant statute scheduled to go into effect in 2022 will “make available” a flood information sheet to buyers that speaks generally about flooding and insurance requirements under federal law. In the 2015 court case Devine v. Buki, a seller was held liable for fraudulently lying about leaks and water damage in the foundation of a 200-year-old house, with a judge rescinding the sale and awarding the buyer $100,000 in attorney’s fees. WASHINGTON — GRADE: C Washington’s disclosure rules are applied differently to “improved” residential real estate—properties that have a structure or structures on them—and “unimproved” properties that do not. For both types of properties, sellers must disclose flooding events, material damage from “floods, beach movements, earthquake, expansive soils or landslides” and “shorelines, wetlands, floodplains or critical areas” on the property. “Improved” properties must also include basement flooding events, while “unimproved” properties must specifically disclose federal floodplain designations. WEST VIRGINIA — GRADE: F West Virginia does not even have a state law that generally governs real estate disclosures—though at least two have been introduced by the legislature since 1996. Thacker v. Tyree, a 1982 court case provided some precedent that “defects or conditions which substantially affect the value or habitability of the property” must be disclosed by a seller, and another court case (Darrisaw v. Old Colony Realty Co.) in 1997 applied that doctrine in part to a home with an undivulged “high water problem.” That ruling added that a misrepresentation like this must be proven a “substantial factor in inducing the purchaser to buy the property” in order to hold the seller liable. WISCONSIN — GRADE: D Wisconsin has two mandatory disclosure forms: one for vacant land containing no buildings, and one for property with dwelling units. The form dealing with inhabited structures only asks if the property is in a floodplain, wetland or shoreland zoning area, along with a specific question about basement defects which “may include items such as flooding.” The vacant land disclosure form includes the same floodplain disclosures, but additionally asks if the property has suffered “material damage from fire, wind, flood, earthquake, expansive soil, erosion or landslide,” or if there is “water diversion, water intrusion or other irritants emanating from neighboring property.” WYOMING —GRADE: F With no mandatory form or flood disclosures, licensed real estate agents must still disclose “adverse material facts actually known by the licensee” to buyers, including “material defects in the property and any environmental hazards.” In the 2006 court case Reed v. Cloninger the court stated that buyers could pursue legal claims against real estate agents “for misrepresenting the condition of the property, provided they knew or reasonably should have known of the defect.” Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post Flood and Disaster Disclosures: Law, Precedent and Grades for All 50 States appeared first on RISMedia......»»

Category: realestateSource: rismediaSep 21st, 2021

Market Rises for Third Time in Four Days

Market Rises for Third Time in Four Days SPECIAL ALERT: Remember, the October episode of the Zacks Ultimate Strategy Session is now available for viewing! Don’t miss your chance to hear: ▪ Tracey Ryniec and Neena Mishra, CFA, FRM, Agree to Disagree on whether the S&P 500 will retest its March lows ▪ Kevin Matras answers what investors should do ahead of the election in Zacks Mailbag ▪ Sheraz Mian and Dan Laboe choose one portfolio to give feedback for improvement ▪ Market conditions from both fundamental and technical views ▪ The full list of top-performing stocks over the past 30 days ▪ New stocks added to the Zacks Ultimate portfolio ▪ And much more Simply log on to Zacks.com and view the October episode here. And please let us know what you think of these monthly episodes. Email all feedback to mailbag@zacks.com. SPECIAL ALERT #2: New Zacks Feature: ASK ALEXA Now call out a stock name or ticker. Alexa will give you its latest Zacks Rank and price. Also hear daily additions to and deletions from the services you follow. For easy directions on starting Zacks on Alexa, click here >> Despite all the craziness about stimulus in the past few days; the market is still going into Friday’s session with solid gains for the week. Each of the major indices are up well over 2% over the past four days. If they can hang on amid all the volatility and uncertainty out there, it would mark the third straight week of green for the NASDAQ and back-to-back winning runs for the Dow and S&P. Of course, who knows what the headlines will be tomorrow? There’s been a market-moving story in each of the past few days, including President Trump returning to the White House after his covid announcement and mixed messages on the odds of a relief bill before the election.   On Thursday, it was Speaker Pelosi’s turn to throw cold water on stimulus. She said there would be no help for the airlines without a more comprehensive package. President Trump tweeted about such a targeted measure on Wednesday, a day after calling off negotiations between Pelosi and Treasury Secretary Mnuchin for a trillion-dollar agreement. While the news did disrupt the market momentarily on Thursday, it didn’t keep stocks from putting together a second straight session of advances. The S&P rose 0.80% today to 3446.83, while the NASDAQ increased 0.50% (or about 56 points) to 11,420.98 and the Dow advanced 0.43% (or around 122 points) to 28,425.51. That makes three positive sessions in the past four. Even the airlines managed to stay positive with United Airlines (UAL), Delta (DAL) and Southwest (LUV) all rising by more than 1%. The market also had to fight through a disappointing jobless claims report. While remaining under 1 million for a sixth straight week, the number is still very high at 840,000 and above expectations of around 820K to 825K.   Let’s see if we can get a strong finish to this chaotic week tomorrow… Today's Portfolio Highlights: Technology Innovators: It was time to “shuffle the deck” in this portfolio, so Brian added a name on Thursday and sold three others. The new buy is Rapid7 (RPD), a Zacks Rank #2 (Buy) software security company that has been “destroying” earnings estimates. It topped the Zacks Consensus Estimate in three of the past four quarters, and the most recent surprise was a robust 600%! As its high Zacks Rank attests, earnings estimates for this year and next are on the rise. In fact, analysts expect a profit of 16 cents for 2021. Meanwhile, the editor sold Logitech Int’l (LOGI) today for a 9.2% return in less than a month, while also getting out of nLight (LASR, +1.5%) and Descartes Systems Group (DSGX). Learn more about today’s moves in the complete commentary. Surprise Trader: Financials lead off earnings season, so Dave has plenty of possibilities from this space to consider. On Thursday, he chose to add First Financial Bankshares (FFIN) with a 12.5% allocation. Why this name among all others? The editor really liked its 58.3% surprise last time. But best of all, FFIN has a positive Earnings ESP of 2.78% for the next report coming before the bell on Thursday, October 22. Also, the expectation for current year revenue growth of 19.95% year over year is “on the high side of what you typically see from a company as mundane as a bank”. The portfolio also sold Thor Industries (THO) for a 3.2% profit in a little over two weeks. See the complete commentary for more. Counterstrike: Earnings season is right around the corner, and Jeremy wants to raise some cash. Fortunately, he has several opportunities to do so. On Thursday, the portfolio sold two positions for double-digit returns. Lumber Liquidators (LL) leaves the portfolio today with a 22.9% return in just two weeks, while Ultra Clean Holdings (UCTT) brought in a 12.6% profit in one month. And the editor also added Keysight Technologies (KEYS) with a 7% allocation. This provider of electronic design and test instrument systems wasn’t appealing to Jeremy in the $90s, but it just keeps moving higher and has turned him into a believer. Plus, KEYS is a Zacks Rank #1 (Strong Buy) that beat by 41% in its quarterly report from August. Read the full write-up for more on today’s action. Marijuana Innovators: Vermont just became the 11th state to legalize recreational marijuana, which led to a great day for cannabis stocks and for this portfolio. And it didn’t hurt that Senator Kamala Harris said a Joe Biden administration would decriminalize marijuana during last night's Vice Presidential debate. As a result, this service had the top two winners on Thursday among all ZU names, as Canopy Growth (CGC) jumped 13.5% and Aphria (APHA) rose 10.3%. Options Trader: "If all goes well tomorrow, it looks like we’ll get our 2nd higher weekly close in a row for both the Dow and the S&P, and the 3rd higher weekly close for the Nasdaq. "(S)tocks continue to rally. And that’s because the economy continues to improve.   "Not only have we had a parade of better than expected economic reports over the last several months, but the future looks even better. One look at Q3 GDP expectations says it all. The Federal Reserve Bank of Atlanta is forecasting a 35.3% growth rate. The largest in history. "In fact, analysts are expecting unprecedented growth for the remainder of the year. And for the annual GDP in 2021 to come in at 5%, which would be the largest annual growth rate in 38 years! "Couple that with near zero interest rates for the foreseeable future (likely 3 years or more), and stocks appear to be gearing up for an historic rally." -- Kevin Matras All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Great Start to November with Epic Election Week Rally

Great Start to November with Epic Election Week Rally Stocks finally cooled off a bit on Friday after four straight days of sharp gains, but it didn’t make a dent in one of the strongest weekly performances of the year. The NASDAQ soared 9% in these five days, while the S&P was up about 7.3% and the Dow increased around 6.9%. That’s a nice turnaround from last week, which saw each of the indices plunge approximately 6% or more. The big news this week was the election, which finally put to rest a nagging uncertainty for investors. Well, it’s almost put to rest... probably... maybe. Biden appears on his way to victory, but the Trump camp plans to challenge several state results. The market would certainly have loved an official winner on Tuesday, but it’s satiated by the likelihood of a Republican Senate to keep the government divided. However, we’re not exactly certain of that either since there will be a couple run-offs in the New Year. For now though, the market is happy. But it’s anybody’s guess how long that will last amid a new wave of coronavirus cases without a new stimulus package. On Friday, the Dow slipped 0.24% (or about 66 points) to 28,323.40, while the S&P was off 0.03% to 3509.44. Not only did these slight losses end four-day winning streaks for these indices, but it also snapped four straight days with gains north of 1%. In fact, several times this week the advances were closer to 2%. The NASDAQ, though, managed to push its winning run to five days just barely. It was up 0.04% (or around 4 points) to 11,895.23. This index surged 3.85% on Wednesday and 2.59% yesterday as tech really took off after the election on hopes for a split Congress. The pullback may have been more severe but for a strong Government Employment Situation report. The economy added 638,000 jobs last month, which was better than expectations for around 550K. Furthermore, the unemployment rate improved a full percentage point to 6.9% from 7.9% in the previous month. Today's Portfolio Highlights: Insider Trader: Restaurants were all the rage when the pandemic began, but their results started normalizing as restaurants slowly reopened. As a result, organic health food grocer Sprouts Farmers Market (SFM) saw shares drop 18.7% over the past three months. However, a new wave of coronavirus cases may have people cooking at home once again. Perhaps that’s why two insiders recently bought shares of their own company earlier this week. Tracey added two new positions on Friday, and one of them was SFM.   The other buy was Inovalon (INOV), which provides cloud-based data analytics and data-driven intervention platforms for healthcare sector. Shares are down 28.7% after the company lowered its full-year guidance due to expectations for covid-related weakness in the fourth quarter. On October 30, the Chief Administrative Officer, the CEO and a director all bought shares. The editor considers these moves to be both “greedy” insider buys AND votes of confidence that things aren’t as bad as they seem. SFM and INOV were each added with 10% allocations. Read the complete commentary for lots more on these companies. Surprise Trader: Who could’ve known that the mattress and pillow business would be so lucrative? Well, actually, Dave did! He bought Sleep Number (SNBR) in early October and the company just reported a “monster” quarter. The stock is now up more than 28% in the service. The editor grabbed more exposure to the space on Friday by adding Purple Innovation (PRPL), a Zacks Rank #2 (Buy) that crushed the Zacks Consensus Estimate by 145% last time. Now it has a positive Earnings ESP of 5.82% for the quarter coming after the bell on Tuesday, November 10. The portfolio added PRPL today with a 12.5% allocation, while also getting out of the sluggish Cardtronics (CATM) position. Read the full write-up for more. Marijuana Innovators: There’s a lot of good things happening in this portfolio right now after the “green wave” in Tuesday’s elections. You’ve probably heard about the “clean sweep” in state referendums on legalization. Five states took the question right to the voters this week... and all five passed! As a result, Aurora Cannabis (ACB) has more than doubled since Tuesday! It was the best performer yesterday with a surge of 41.5%, and stayed at the top of the mountain today with a further surge of 53.3%. Artelo Biosciences (ARTL) was also a winner on Friday with a rise of 14.9%. But that’s not all. Dave decided to buy GrowGeneration (GRWG), an upstart that owns and operates specialty retail hydroponic and organic gardening stores. Read the editor’s complete commentary for a lot more on GRWG and the brightening prospects for marijuana stocks. Value Investor: You wouldn’t think that the $22 billion agribusiness company Nutrien (NTR) and the luxury homebuilder Toll Brothers (TOL) would have much in common, but they are similar in two ways. They both have solid value characteristics AND they were both added to this portfolio today. NTR launched its digital business at the perfect time... right before the pandemic hit. The company is now “blowing away estimates” with earnings expected to rise 25% this year, though shares remain down more than 17% year-to-date. Meanwhile, TOL is a Zacks Rank #1 (Strong Buy) and part of a strong industry. Shares are down 7% in the past month, but still up 15% this year. Read the complete commentary for a lot more about these moves, including specifics on their value credentials.  Options Trader: "It was another great jobs report and shows just how strong the economy has been bouncing back. "And after Q3's unprecedented GDP growth, and forecasts for a strong Q4, not to mention expectations for 2021 to have the strongest full-year GDP in 38 years, you can see why stocks have been rallying, and why it looks like they will continue to do so. "Let's also not forget about earnings season. It's been doing great. And that should come as no surprise given how strong Q3 GDP was. We have another 1,352 companies reporting earnings next week.   "And lastly, there's still hope for another coronavirus stimulus package by year's end. "We've got an amazing rally underway. And we could see that extended next week." -- Kevin Matras Have a Great Weekend! Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

NASDAQ Soars 3% as Tech Rebounds to Begin March

NASDAQ Soars 3% as Tech Rebounds to Begin March The first session of March 2021 provided us with a fresh start after the second-half of February was ruined by fears of rapidly rising rates. The major indices all surged on Monday by 2% or more amid steadier bond yields and a new covid vaccine. The beleaguered NASDAQ easily led the way with a surge of 3.01% (or nearly 400 points) to 13,588.83, which was the tech-heavy index’s best performance of the year so far. The upswing recovered more than half of last week’s 5.2% plunge. As you might expect, it was an especially strong day for the FAANGs. Apple (AAPL) jumped nearly 5.4% and Facebook (FB) advanced 2.8%, while Netflix (NFLX) and Alphabet (GOOG) were each up about 2.2%. The S&P also took advantage of the tech rebound and surged 2.38% to 3901.82, while the Dow managed to rise 1.95% (or more than 600 points) to 31,535.51. Stocks are coming off a tough week that saw the indices decline by approximately 2% or more. However, February was still positive for them all, showing the reversal of fortune from an outstanding first half of the month to a more paranoid second half. The 10-year Treasury yield remained below 1.5% for a second straight session. Investors got concerned last Thursday when it moved past 1.6%, but it seems to have steadied for now. This new calm facilitated today’s tech rebound. Meanwhile, the FDA cleared Johnson & Johnson’s (JNJ) covid vaccine for emergency use authorization over the weekend. This single-dose treatment marks the third weapon against this pandemic, which could significantly increase the speed by which the country gets back to normal. Also this weekend, the Biden Administration’s $1.9 trillion stimulus plan passed the House. This bill includes direct checks of $1400 to Americans and hundreds of billions of dollars in relief to state governments, among other measures. It now moves on to the Senate. The big earnings news on Monday came after the bell from stay-home staple Zoom (ZM), which easily beat fourth-quarter expectations on both the top and bottom lines. Shares were up 9.7% in the session and have climbed over 8.5% after hours, as of this writing. As this better-than-expected earnings season winds down, we’ll be getting some major retail reports the rest of this week. Perhaps the biggest comes tomorrow when Target (TGT) goes to the plate before the bell. Today's Portfolio Highlights: Insider Trader: Get ready for a lot more action in this portfolio as the insiders are really making moves right now. For her first buy of March, Tracey picked up Trinseo (TSE), a Zacks Rank #1 (Strong Buy) global materials company that’s into things like plastics, latex binders and synthetic rubber. Shares are up more than 200% in the past year, and yet a director bought 5,000 shares last week. It’s very bullish to see insiders add shares on an upswing, since it suggests they see even more improvement moving forward. Such optimism seems warranted for TSE, which is a global economic recovery play that expects to see “significant earnings improvement’ in 2021. The editor added TSE today with a 7.5% allocation after losing her patience with NVIDIA (NVDA) and selling the innovative chipmaker for a 6.5% profit in about five months. Read the full write-up for a lot more on today’s action. Blockchain Innovators: The two best performers among all ZU names in this sharply higher session came from this portfolio. The biggest winner on Monday was ZK International (ZKIN, +23.8%), while the runner up was Cleanspark (CLSK, +18.9%). Black Box Trader: The portfolio swapped out three positions in this week’s adjustment. The stocks that were short-covered on Monday include: • Tronox (TROX, +8.6%) • XPO Logistics (XPO) • Camping World (CWH) The new buys that replaced these names were: • Deutsche Bank (DB) • Owens & Minor (OMI) • Toll Brothers (TOL) Read the Black Box Trader’s Guide to learn more about this computer-driven service. Counterstrike: “One of the reasons we saw the bullish sentiment was the Johnson & Johnson vaccine has finally gotten the go ahead. This one-shot vaccine is a difference maker as J&J has the ability to scale better than the others. This allows us to flood the streets with vaccine, which means everyone should be able to get a shot over the next few months.   “The other reason for the market optimism was the risk from last week doesn’t seem to be an issue thanks to the Reserve Bank of Australia. In what seemed to be a panic response to last week, the RBA doubled down on bond purchases last night. This set the tone for government bonds as it was a reminder that the central banks are in full control and simply won’t stop. “Looking to add to the stocks above over the next couple days. Also, we should have some new positions. This market is impossible to short so we aren’t looking that direction any longer.” – Jeremy Mullin All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Dow Jumps Nearly 1.5% to Reach a New Closing High

Dow Jumps Nearly 1.5% to Reach a New Closing High SPECIAL ALERT: Remember, the March episode of the Zacks Ultimate Strategy Session is now available for viewing! Don’t miss your chance to hear: ▪ Jeremy Mullin and Brian Bolan Agree to Disagree on Investing in SPACs versus traditional IPOs ▪ Kevin Matras covers whether we should be worried about rising rates with all of the talk about inflation and rising treasury yields in Zacks Mailbag ▪ Sheraz Mian and Daniel Laboe choose one portfolio to give feedback for improvement ▪ Market conditions from both fundamental and technical views ▪ The full list of top-performing stocks over the past 30 days ▪ New stocks added to the Zacks Ultimate portfolio ▪ And much more Simply log on to Zacks.com and view the March episode here. And please let us know what you think of these monthly episodes. Email all feedback to mailbag@zacks.com. The NASDAQ and Dow continued going their separate ways on Wednesday with the former index failing to add onto its recent surge while the latter reached a new all-time high. Recovery stocks took off amid tepid inflation data and the passage of more stimulus, while tech took a breather. The Dow soared 1.46% (or about 464 points) to 32,297.02, which marks its first closing high since February 24. It has advanced more than 4% over this four-day winning streak. Meanwhile, the S&P rose 0.60% to 3898.81, which means it’s within 1% of its own record. The tech rebound on Tuesday had no follow though, as recovery names were again getting most of the attention on Wednesday. However, the NASDAQ managed to hold onto pretty much all of yesterday’s 3.7% surge, which was its best single-day performance of 2021 thus far. The index slipped only 0.04% (or less than five points) to 13,068.83. There were a couple reasons for investors to remain bullish on Wednesday. First of all, the House passed the $1.9 trillion covid stimulus plan today. President Biden will sign it later this week or this weekend with the $1400 checks starting to roll out shortly thereafter. The bill passed without any support from Republicans, which underscores why the market was so happy with the Democrats taking complete control of the government in the recent elections. The passage was widely expected and, therefore, didn’t have much of an impact, but the Consumer Price Index was a bit more unpredictable and carried more potential to move the market. And it did!   Consumer prices rose last month by 0.4%, but that was in-line with expectations. In other words, we didn’t see any spikes that would suggest inflation becoming a problem sooner rather than later. Despite investor concerns, it’s still in check and the economic recovery can continue unabated for the time being. As a result, the 10-year Treasury yield remained well below 1.6% for a second day after crossing over that mark this past Monday. Today's Portfolio Highlights: Home Run Investor: The recent tech rebound convinced Brian to add some exposure to that space, so he picked up Cutera (CUTR) on Wednesday. This Zacks Rank #2 (Buy) is in the cosmetic laser business. It has beaten the Zacks Consensus Estimate in the past three quarters, but the editor most appreciates that those positive surprises have been growing over that time on a percentage basis. Plus, expectations for this year have flipped to a one-cent profit from an 8-cent loss over the past 30 days. In fact, earnings and sales growth expectations are very encouraging for this year and next. The addition of CUTR means the portfolio is only one position shy of being fully-invested at 15 names. Read the full write-up for more on today’s move. Surprise Trader: Gaming stocks just can’t wait for the economy to re-open. The space is up big today and could see more momentum moving forward. Dave decided to get involved by adding Golden Entertainment (GDEN) ahead of its quarterly report tomorrow after the bell. This diverse gaming company offers casino, gaming and lottery services. It has a positive Earnings ESP of 2.86% for the upcoming report. The editor bought GDEN on Wednesday with a 12.5% allocation, while also selling half of Primoris (PRIM) for a 23% return in less than a month. Read the full write-up for more on today’s moves. Healthcare Innovators: After selling Guardant Health (GH) exactly one week ago for a more than 83% return, this portfolio is looking to re-gain exposure to diagnostics companies. On Wednesday, Kevin added Exact Sciences (EXAS), a molecular diagnostics company focused on the early detection and prevention of cancer. It’s best-known for its Cologuard test. Earnings estimates for EXAS were cut after their report last month, but that was due to heavy investment in its business to expand the menu of critical diagnostics. The editor thinks the future looks great for EXAS and sees an upside to at least $150 this year. The portfolio also got out of Acadia Pharma (ACAD) today. Read the full write-up for more on today’s moves. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Slip From Record Highs Ahead of FOMC Announcement

Stocks Slip From Record Highs Ahead of FOMC Announcement Well, we can’t make new highs every day, especially when we’re less than 24 hours away from a big Fed statement that could be a market mover. So the major indices took a small step back on Tuesday, ending three straight days of record highs for the S&P. The index slipped 0.20% to 4246.59. The S&P hit its first new record since early May on Thursday and then gained in the subsequent two sessions. The Dow dropped 0.27% (or about 94 points) to 34,299.33 for its second straight loss, as recovery names cooled off along with inflation fears. For the first time in seven sessions, the NASDAQ underperformed its counterparts. The index slid 0.71% (or about 101 points) to 14,072.86. But what a ride it was! After weeks of being in the doghouse, investors finally rediscovered tech and sent the NASDAQ to its first new record since late April in yesterday's session. Speaking of inflation fears, investors are gearing up for tomorrow’s FOMC announcement and Fed Chair press conference. They won’t be making any changes to the monetary policy, but there could be some differences in the rhetoric that investors will be watching. Simply put, if Chair Powell & Friends are too hawkish, then we’d be in danger of another ‘taper tantrum’. However, if they’re more reserved (as is expected), we should be able to continue grinding higher through the slow summer months.    In other news on Tuesday, retail sales for May dropped 1.3% over April, which was worse than expected and marks the first decline since February. However, April sales were revised higher to 0.9%. Meanwhile, the producer price index for final demand jumped 0.8%, which was higher than expected and the latest sign of rising inflation. The Fed has said several times that any uptick in inflation is ‘transitory’. Investors will be watching for any updates on this issue in tomorrow’s statement. Today's Portfolio Highlights: Headline Trader: U.S. lawmakers are likely to approve $54 billion in funding for the production and research of semiconductors and telecommunication technology. Dan thinks that Taiwan Semiconductor Manufacturing Company (TSM) will be a big beneficiary of this money, especially as it works on another $12 billion factory in Arizona. But even without this funding, TSM is the largest semiconductor manufacturer on earth. In fact, the editor considers it to be “the backbone of the fourth industrial revolution”. He believes that the chip shortage is ramping up demand in the space, leaving companies (like TSM) in a fantastic position to get back to all-time highs. The portfolio added the stock on Tuesday with an 8% allocation. Dan’s next price target for TSM is at $140 after finally breaking through prior resistance at $120. Read the full write-up for a lot more on this new addition. Counterstrike: Despite all the sluggishness out there, Jeremy has been looking for a new name to add. On Tuesday, he picked up Thor Industries (THO), a Zacks Rank #2 (Buy) RV manufacturer that saw demand soar during the pandemic. It’s recent quarterly report included an earnings beat of 39% and a $14 billion order backlog, so demand is still strong even with covid on the way out. However, the stock has dropped 10% since the report and is off nearly 30% from the March highs. The editor decided to buy a small, 4% position now in THO and will add if the 200-day is taken back. He expects the stock to move back to the 50-day and perhaps make new highs later this year. The service also sold Invesco Solar ETF (TAN) today for a 10.9% profit in a little over a month and got out of Canada Goose (GOOS) with a slight loss after disappointing earnings and a drop in its Zacks Rank. Read the full write-up for a lot more on today’s moves. Zacks Short Sell List: The portfolio swapped out two names in this week's adjustment. The stocks that were short-covered included Magnite (MGNI, +3.8%) and Bumble (BMBL), while the new buys that filled these spots were StoneCo (STNE) and T-Mobile US (TMUS). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short Sell List Trader Guide. By the way, this portfolio had a top performer today as the short in Peloton Interactive (PTON) rose 5.3%. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Pelosi dings Republicans over possible government shutdown: ‘The former president was famous for not paying his bills’

Pelosi likened Republicans to former President Donald Trump, who failed to pay bills both when he was a real estate developer and a candidate. Former President Donald Trump turns away as House Speaker Nancy Pelosi reaches out to shake his hand before the State of the Union address in the House chamber on February 4, 2020 in Washington, DC. Leah Millis/Pool/Getty Images Nancy Pelosi criticized Republicans on Thursday for voting against a bill to avert a government shutdown. "The former president was famous for not paying his bills," said Pelosi. "And they want to do that again." Trump has a history of not paying bills, both in his personal life and during his campaigns. See more stories on Insider's business page. At her weekly press conference on Thursday, House Speaker Nancy Pelosi took a shot at former President Donald Trump as she criticized Republicans for failing to support a measure to avert a looming government shutdown."You know, the former president was famous for not paying his bills," said Pelosi. "And they want to do that again, but we cannot let them do that and jeopardize our economy.-CBS News (@CBSNews) September 23, 2021 "Why should it be that we as Democrats always come to the rescue when it's a Republican president?" Pelosi asked during the press conference. "And we're not coming to the rescue of the president, we're coming to the rescue of our economy."The House passed a bill on Tuesday to keep the government open and suspend the country's debt limit until December, which also included nearly $35 billion in disaster aid to and relocation funds Afghan refugees who assisted US forces during the recently-concluded war in Afghanistan. That bill passed on a party-line vote but is likely to be blocked in the Senate.Pelosi's analogy likened Republican attitudes to funding the government to a well-publicized record of the former President and one-time real estate developer failing to pay contractors and vendors for their services.And that behavior often carried over to Trump's campaign, including millions of dollars in unpaid bills from local police departments in connection with political rallies. In April of this year, Albuquerque Mayor Tim Keller sent a $211,000 bill to Mar-a-Lago after a 2019 Trump campaign event forced the city to shut down the downtown area and close city hall, resulting in "tremendous" costs to the city.-The Daily Show (@TheDailyShow) April 22, 2021 Read the original article on Business Insider.....»»

Category: worldSource: nyt23 min. ago

Big investors are dumping bitcoin futures and pivoting to ethereum as expectations for the world"s largest cryptocurrency soften, JPMorgan says

"This is a setback for bitcoin and a reflection of weak demand by institutional investors," the JPMorgan analysts said. Ethereum and bitcoin. Jordan Mansfield /Getty Images Institutional investors are shying away from bitcoin futures as views on the top cryptocurrency soften, JPMorgan said. In September, bitcoin futures have traded below the price of an actual bitcoin, analysts said. Big investors have begun steadily pivoting to ethereum since August amid a "strong divergence in demand." Sign up here for our daily newsletter, 10 Things Before the Opening Bell. Big-money investors are shying away from the bitcoin futures trade and pivoting instead to ethereum futures as expectations for the world's largest cryptocurrency soften, JPMorgan analysts wrote in a note on Wednesday.In September, bitcoin futures on the Chicago Mercantile Exchange have traded below the price of an actual bitcoin, the analysts noted. "This is a setback for bitcoin and a reflection of weak demand by institutional investors that tend to use regulated CME futures contracts to gain exposure to bitcoin," the analysts wrote.Under healthy demand, futures usually trade at a premium to actual bitcoin. This happens because high bitcoin storage costs and the juicy yields available for passive crypto investing push up futures prices, according to previous JPMorgan research.That dynamic makes the current weakness in futures especially bearish for bitcoin, the analysts wrote.Meanwhile, institutional investors have begun steadily pivoting to ethereum since August. The 21-day average ethereum futures premium rose to 1% over actual ether prices, according to CME data cited by JPMorgan, showing a "strong divergence in demand.""This points to much healthier demand for ethereum vs. bitcoin by institutional investors," the JPMorgan analysts wrote.Ether prices have fallen 3% in the last month while bitcoin has fallen 10%. Last week, JPMorgan's crypto guru - who also co-authored the note on institutional demand - told Insider that he expects ethereum to keep declining as it faces growing competition from the likes of solana and cardano.Read the original article on Business Insider.....»»

Category: worldSource: nyt23 min. ago

Texas sued by group of Big Tech giants over censorship bill they say would protect "pro-Nazi speech" and "terrorist propaganda"

Signed by Gov. Greg Abbott earlier this month, HB20 would allow Texas residents banned from social media to sue platforms like Facebook and Twitter. Left to right: Facebook CEO Mark Zuckerberg, Twitter CEO Jack Dorsey, and Google CEO Sundar Pichai. Andrew Harnik/Rolf Vennenbernd/picture alliance/Pool via REUTERS Groups representing Facebook, Youtube, and Twitter are suing Texas over a "social media censorship" law. Proponents say the law prevents users from being booted of platforms for their political views. Multiple courts have ruled against similar laws, citing private companies' rights to editorial discretion. See more stories on Insider's business page. Two major trade groups representing social media platforms Facebook, YouTube, and Twitter are suing the Attorney General of Texas over a new state law that supporters say would limit the "censorship" of conservative users. HB20, which passed in Texas earlier this month, bans social-media companies with more than 50 million monthly active users from censoring people because of "the viewpoint of the user or another person," the law states. It also allows users "banned from social media for their political beliefs" to sue the platform that banned them. Tech companies say the law "would unconstitutionally require platforms like YouTube and Facebook to disseminate, for example, pro-Nazi speech, terrorist propaganda, foreign government disinformation, and medical misinformation," according to the suit. The plaintiffs cite multiple court decisions defending a private company's right to editorial discretion under the first amendment. This includes a Florida law similarly targeting social media companies that was blocked by a federal judge in June. "Forcing those companies to give equal treatment to all viewpoints puts Nazi party political speech and extremist messages from Taliban sympathizers on equal footing with God bless America," Matt Schruers, president of the Computer & Communications Industry Association, told USA Today. On the other side of the lawsuit is Attorney General Ken Paxton, a fervent Trump loyalist who spoke at the rally preceding the Jan 6. attack on the US capitol. Texas GOP leaders initially raised Big Tech censorship concerns following the US capitol insurrection that killed five people and injured more than 100 officers.In response, several major social-media networks banned former president Donald Trump from their platforms citing a violation of their terms and services, in addition to blocking accounts linked to election misinformation. "The seemingly coordinated de-platforming of the President of the United States and several leading voices not only chills free speech, it wholly silences those whose speech and political beliefs do not align with leaders of Big Tech companies," Paxton said in a news release one week after the riot. "I will defend the First Amendment and ensure that conservative voices have the right to be heard," Paxton said in a statement. "Big Tech does not have the authority to police the expressions of people whose political viewpoint they simply disagree with."Facebook, Twitter, and YouTube did not immediately respond to Insider's request for comment. Read the original article on Business Insider.....»»

Category: worldSource: nyt23 min. ago

Scientists have created rechargeable, glow-in-the-dark plants using nanoparticles that absorb and emit light

A group of researchers from MIT modified the leaves of different plant species with nanoparticles that absorb then emit light. Green nanoparticles that absorb then emit light, as viewed under a microscope inside a plant leaf. Strano et al., Science Advances, 2021 MIT researchers embedded plant leaves with rechargeable nanoparticles that absorb and emit light. After a 10-second charge with an LED light, the nanoparticles glow in the dark for several minutes. "This is a big step toward plant-based lighting," one of the researchers said. See more stories on Insider's business page. Scientists are working on a rechargeable, glow-in-the-dark plant that could replace some of the energy-intensive electric lights we currently rely on.The technology works thanks to nanoparticles that get embedded near the surface of leaves. A 10-second charge from an LED light lasting charges the nanoparticles enough for the plant to then glow brightly for several minutes, and the nanoparticles can be repeatedly recharged.New research, published in the journal Science Advances, is part of a growing field called plant nanobionics - using nanoparticles to add extra functions and capabilities to living plants. This is the second generation of the technology that scientists have developed."We wanted to create a light-emitting plant with particles that will absorb light, store some of it, and emit it gradually," Michael Strano, a chemical engineering from MIT and co-author of the new study, said in a press release. "This is a big step toward plant-based lighting."Material that can absorb and emit light inside plant leavesAt the core of the glowing plants are capacitors that can store light in the form of photons, then release them over time. A compound called strontium aluminate was used as a phosphor - a material that can absorb visible and ultraviolet light, and emit it as a glow.Strontium aluminate can be formed into nanoparticles, which Strano's team then coated in silica to protect them from damage. The researchers embedded the nanoparticles in a plant's stomata - the small pores on the surface of leaves that allow gases to pass in or out of the plant's tissues. A graphic showing how scientists modified a plant leaf with nanoparticles that absorb and emit light. Strano et al., Science Advances, 2021 The team was able to get the technology working in five plant species that each had leaves of different sizes: basil, watercress, tobacco, daisy, and the Thailand elephant ear plant."We need to have an intense light, delivered as one pulse for a few seconds, and that can charge it," Pavlo Gordiichuk, an MIT nanoscientist and study co-author, said in the release."We also showed that we can use big lenses, such as a Fresnel lens, to transfer our amplified light a distance more than 1 meter. This is a good step toward creating lighting at a scale that people could use," he added. A glowing Thailand elephant ear leaf with nanoparticles embedded inside. Strano et al., Science Advances, 2021 Further analysis revealed that the plants were still photosynthesizing normally, and could continue to evaporate water through their stomata. After the experiments, the scientists were able to extract and reuse around 60% of the phosphors that had been used.What makes the technology even more promising is that it's a significant upgrade over the first-generation nanoparticles used to make glowing plants. Those particles used luciferase and luciferin enzymes (found in fireflies) to produce a very dim glow.The researchers said one day different types of nanoparticles could be combined in the same plant.We're still a ways from this technology being something that can be used practically - researchers seem to be able to recharge a leaf for only two weeks or so. But it's undoubtedly a bright innovation to keep an eye on for the future."Creating ambient light with the renewable chemical energy of living plants is a bold idea," Sheila Kennedy, another study co-author, said in the release. "It represents a fundamental shift in how we think about living plants and electrical energy for lighting."Read the original article on Business Insider.....»»

Category: worldSource: nyt23 min. ago

Household Net Worth Hits Record $142 Trillion, Up $31 Trillion Since COVID, But There Is A Catch...

Household Net Worth Hits Record $142 Trillion, Up $31 Trillion Since COVID, But There Is A Catch... Another quarter, another record high in (1%er) household net worth. The Fed's latest Flow of Funds report released at noon today showed the latest snapshot of the US "household" sector as of June 30 2021, which confirmed that one year after the biggest drop in household net worth on record when $8 trillion was wiped out in Q1, 2020, in the 2nd quarter of 2021 the net worth of US households soared by another $5.85 trillion, or 4.3%, rising to a new all time high of $141.7 trillion. As has traditionally been the case, real estate ($34.9 trillion) and directly and indirectly held corporate equities ($47.0 trillion) were the largest components of household net worth. Meanwhile, household debt (seasonally adjusted) was $17.3 trillion. This means that over the past 12 months, US household net worth has increased by: Q2 2020: $7.92TN Q3 2020: $4.26TN Q4 2020: $7.9TN Q1 2021: $5.1TN Q2 2021: $5.85TN ... a grand total of $31 trillion. And since the bulk of this wealth goes to a fraction of the wealthiest 1% (see chart at the bottom), it means that the covid pandemic has been the biggest wealth transfer in history, making America's richest even richer. Looking at the composition of the wealth change, $3.54 trillion came from a gain in stocks, $1.2 trillion was from an increase in real estate values - the biggest quarterly increase in housing values on record -  and another $1.1 trillion coming from "other sources." And visually: It wasn't just housing and real-estate: net private savings grew at an annualized pace of almost $2.9 trillion in the second quarter after a $4.8 trillion surge in the prior quarter -- which while still a high number, suggests that almost $2 trillion in excess savings have already been spent. Excess savings have been a key driver of consumer spending, including last quarter, where consumer outlays jumped at one of the fastest paces on record. Of course, in addition to assets, liabilities also grew, and in Q2 2021 household debt grew at a 7.9% SAAR, a more rapid pace than in previous quarters as home mortgages surged by 8.0%, spurred by rising home prices and sale activity as well as by the Fed keeping borrowing costs near zero. That’s led to record-low mortgage rates, which have bolstered demand for homes. The median selling price for previously owned homes is at a record high. Homeowners’ real estate holdings minus the change in mortgage debt rose $879.7 billion (a positive value indicates that the value of real estate is growing at a faster pace than household mortgage debt). Meanwhile, nonmortgage consumer credit increased by 8.6%, as credit cards, auto loans, and student debt all increased. Nonfinancial business debt grew at a rate of 1.4%, reflecting continuing growth in commercial mortagages, nonbank loans, and corporate bonds and a decline in nonmortgage depository loans. Federal debt rose 9.6%. State and local debt increased 3.1%. As GDP continued to grow, the ratio of nonfinancial debt to GDP edged down a bit further. In the second quarter of 2020, the ratio had spiked, driven by the drop in GDP and the expansion in federal debt related to the fiscal stimulus. Looking at the various components of nonfinancial business debt, nonmortgage depository loans to nonfinancial business decreased $143 billion in the first quarter. Contributing to the decline was the forgiveness of many loans extended under the Paycheck Protection Program (PPP), which more than offset the extension of new PPP loans. However, nonmortgage depository loans declined even excluding PPP loans. More than 400 billion of PPP loans were on the lenders’ balance sheet at the end of the second quarter and thus are still included in our measure of nonfinancial business debt. However, a large fraction of them is expected to be forgiven. In contrast to nonmortgage depository loans, commercial mortgages and nonbank loans continued to increase. Corporate bonds also increased, though at a slower pace than in the first quarter. Overall, outstanding nonfinancial corporate debt was $11.2 trillion. Corporate bonds, at roughly $6.6 trillion, accounted for 59% of the total. Nonmortgage depository loans were about $1.0 trillion. Other types of debt include loans from nonbank institutions, loans from the federal government, and commercial paper. The nonfinancial noncorporate business sector consists mostly of smaller businesses, which are typically not incorporated. Nonfinancial noncorporate business debt was $6.7 trillion, of which $4.7 trillion were mortgage loans and $1.6 trillion were nonmortgage depository loans. And while it would be great if this wealth increase was spread across most Americans, there is - as usual - a catch as unfortunately, most Americans aren’t benefiting from recent gains in wealth, and while the pandemic has led to a surge in savings and opportunities for many to buy a home or invest while pushing up the financial assets of the "top 10%" to record highs, the downturn has disproportionately impacted low-income workers, many of whom rent and don’t participate in the stock market. Indeed, the latest data as of Q1 shows that the top 1% accounts for over $41.5 trillion of total household net worth, with the number rising to over $90 trillion for just the top 10%. Meanwhile, the bottom half of the US population has virtually no assets at all. On a percentage basis, just the Top 1% now own a record 32.1% share of total US net worth, or $45.6 trillion. In other words, the richest Americans have never owned a greater share of US household income than they do, largely thanks to the Fed. Meanwhile, the bottom 50% own just 2% of all net worth, or a paltry $2.8 trillion. They do own most of the debt though... A closer look at the percentile breakdown: And the saddest chart of all: the wealth of the bottom 50% is virtually unchanged since 2006, while the net worth of the Top 1% has risen by 132% from $17.9 trillion to $41.5 trillion. Bottom line: the data underscore how the government's fiscal scramble to speed up the "economic recovery" paired with the Fed's continued ultra easy monetary policy have helped to protect and grow the wealth of the richest Americans: those who own assets, and who have seen their net worth hit an all time high... unlike the bottom 50% of Americans who mostly "own" debt.  Tyler Durden Thu, 09/23/2021 - 13:13.....»»

Category: blogSource: zerohedge38 min. ago

5 Stocks to Watch Amid Surging Demand for Digital Payments

Watch out for stocks like Apple (AAPL), Usio (USIO), EVERTEC (EVTC), Visa (V) and Alphabet (GOOGL) amid continued demand for digital payment as a safe and convenient way of transacting. As the pandemic halted in-store shopping, people resorted to shopping online and preferred digital or contactless payments as a safer method for transacting. Safety has become a priority among consumers around the world and businesses have been adopting contactless payment methods to meet the growing demand. Per the Back to Business Study report by Visa Inc. V, 48% of consumers said that they wouldn’t shop at a store unless it offered some form of contactless payment, as mentioned in a Vending Market Watch article.In fact, a survey conducted by the National Retail Federation and Forrester in the United States last year found that 67% of the retailers surveyed were accepting some form of contactless payment. This included 58% of retailers that accept contactless cards that can be waved past or tapped on card readers compared to 40% in 2019, while 56% reported taking digital wallet payments on mobile phones, rising from 44% in 2019.Apart from being contactless, digital payments offer other benefits which can ensure that their demand continues to accelerate even beyond the pandemic. Digital payments provide faster and hassle-free transactions. Consumers don’t have to carry cash with them and can also complete transactions via their smartphones. Merchants and financial institutions too offer certain discounts upon purchases as well as other offers, making it even more exciting for consumers. It also helps consumers to easily keep track of how much they are spending and where, as the details of the transactions are readily available.Several forms of digital payments are available and while credit and debit cards have been popular choices, other methods like quick response (“QR”) code scanning are gaining traction. This is because consumers simply have to scan the merchant’s QR code to initiate the payment process, making it even more convenient. In fact, per a Juniper Research report, the number of QR code payments users is expected to exceed 2.2 billion in 2025, from 1.5 billion in 2020, and amount to 29% of mobile users worldwide.Reflective of the positive developments that digital payments have been witnessing, the digital payments market is expected to grow. Per a report by ReportLinker, the digital payments market is expected to witness a CAGR of 13.7% from 2021 to 2026, as mentioned in a GlobeNewswire article.5 Stocks to WatchThe popularity of digital payments is set to accelerate further, thanks to the myriad conveniences they offer. This seems then a good time to look at companies offering digital payment solutions that stand to benefit from this potential. We have selected five such stocks that carry a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.Apple Inc. AAPL offers Apple Card, a co-branded credit card; and Apple Pay, a cashless payment service. On Aug 19, the company announced that Apple Card, which is the only card issued by Goldman Sachs, ranked highest among the Midsize Credit Card segment in the J.D. Power 2021 U.S. Credit Card Satisfaction Study.Shares of Apple have risen 9.9% year to date and it currently flaunts a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings increased 7.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 70.4%.Usio, Inc. USIO, together with its subsidiaries, provides integrated electronic payment processing services to merchants and businesses in the United States. The company offers various types of automated clearing house processing; and credit, prepaid card, and debit card-based processing services.Shares of Zacks Rank #2 Usio have risen 125.1% year to date. The Zacks Consensus Estimate for its current-year earnings improved 55.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 82.6%.EVERTEC, Inc. EVTC provides merchant acquiring services, which enable point of sales and e-commerce merchants to accept and process electronic methods of payment, such as debit, credit, prepaid, and electronic benefit transfer cards.Shares of EVERTEC have risen 17.1% year to date. The Zacks Consensus Estimate for its current-year earnings increased 13.8% over the past 60 days. This Zacks Rank #2 company’s expected earnings growth rate for the current year is 27.5%.Visa facilitates digital payments among consumers, merchants, financial institutions, businesses, strategic partners, and government entities. On Apr 7, the company announced that it had processed one billion additional touch-free payments in Europe, within less than a year since contactless payment limits were increased across 29 countries in Europe due to the pandemic.Shares of Visa have gained 7.1% over the past six months and it currently has a Zacks Rank #3. The Zacks Consensus Estimate for its current-year earnings increased 3.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 15.5%.Alphabet Inc.’s GOOGL Google offers Google Pay, a digital payment app where users can send or receive money with ease. The app also supports QR code scan payments.Shares of this Zacks Rank #3 company have risen 60.1% year to date. The Zacks Consensus Estimate for its current-year earnings increased 13.3% over the past 60 days. The company’s expected earnings growth rate for the current year is 73.8%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Apple Inc. (AAPL): Free Stock Analysis Report Visa Inc. (V): Free Stock Analysis Report Evertec, Inc. (EVTC): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report Usio Inc (USIO): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacks1 hr. 54 min. ago

Bored of Big Tech Names? 5 Future Tech ETF Plays for You

FAANG stocks ??? Facebook, Apple, Amazon, Netflix and Alphabet's Google ??? along with Microsoft and Tesla make up a big chunk of the S&P 500. But the trend is probably shifting and disruptive technologies will likely rule the coming decade. FAANG stocks — Facebook Inc. FB, Apple Inc. AAPL, Amazon.com Inc. AMZN, Netflix Inc. (NFLX) and Alphabet Inc.’s (GOOG, GOOGL) Google — along with Microsoft Corp. MSFT and Tesla Inc. TSLA take about 25% of the S&P 500. Many are now of the view that these seven behemoths are responsible for the broader market’s hop and drop. These cash-rich companies have swelled in their market capitalization in recent years.But the trend is probably shifting. Goldman Sachs believes people are over invested in big-cap tech names.  "We noticed there was a growing disconnect between where investors are positioned and where we are seeing the most attractive returns over the next decade or so," said Sung Cho, the portfolio manager of the Goldman Sachs Future Tech Leaders ETF, on Yahoo Finance Live."For the last 20 years, it has been focused in the U.S. and in mega cap tech companies. We believe we are at a key inflection point where innovation is expanding beyond the U.S., as well as beyond the market cap spectrum," according to Cho, as quoted on Yahoo Finance.And why not? Disruptive technologies are booming, especially with more dependence on technology amid coronavirus-led social distancing. Our dependence on areas like AI, robotics, autonomous vehicles, computer perception, and virtual and augmented reality has been growing.Quantum computing is another technology holding a lot of potential but is still new in the market. It is expected to transform industries with new artificial intelligence and machine learning applications in few years (read: Market Outlook & Thematic ETF Ideas for Q4).Against this backdrop, below we highlight a few future tech ETFs that focus on future era tech plays.ETFs in FocusGoldman Sachs Future Tech Leaders Equity ETF GTEKThis ETF is active and does not track a benchmark. Marvell Technology (3.1%), MercadoLibre (3.0%) and HubSpot (2.6%) were the top three stocks of the fund. The fund charges 75 bps in fees. The fund looks to keep investors on the right side of disruption by picking innovative, attractively-valued companies associated with durable secular growth themes.BlackRock Future Tech ETF BTEKThe fund looks to maximize total return by investing in companies developing innovative and emerging technologies in the technology sector. The fund charges 88 bps in fees. No stock accounts for more than 3.62% of the fund. Lightspeed Commerce (3.62%), Silergy Corp. (2.16%) and Marvell Technology (2.02%) are the top three stocks of the fund.iShares U.S. Tech Breakthrough Multisector ETF TECBThe underlying NYSE FactSet U.S. Tech Breakthrough Index measures the performance of U.S. listed companies engaged in cutting edge research and development of products and services in the areas of robotics and artificial intelligence, cyber security, cloud and data tech, financial technology, and genomics and immunology. The 173-stock fund puts heavy weights on Moderna (4.38%), Nvidia (4.31%) and Microsoft (4.19%).ALPS Disruptive Technologies ETF DTECThe underlying Indxx Disruptive Technologies Index identifies companies using disruptive technologies in each of 10 thematic areas: Healthcare Innovation, Internet of Things, Clean Energy and Smart Grid, Cloud Computing, Data and Analytics, FinTech, Robotics and Artificial Intelligence, Cybersecurity, 3D Printing, and Mobile Payments.  No stock accounts for more than 1.18% of the fund. Brooks Automation, Allegro MicroSystems and Nemetschek are the top three stocks of the fund.Amplify Transformational Data Sharing ETF BLOKThis ETF is active and does not track a benchmark. Transactional services take about 32% of the fund while crypto miner (24%), venture (11%) and semiconductor (10%) take the next three spots. The fund charges 71 bps in fees. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alphabet Inc. (GOOG): Get Free Report Amazon.com, Inc. (AMZN): Free Stock Analysis Report Apple Inc. (AAPL): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Facebook, Inc. (FB): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report Amplify Transformational Data Sharing ETF (BLOK): ETF Research Reports ALPS Disruptive Technologies ETF (DTEC): ETF Research Reports iShares U.S. Tech Breakthrough Multisector ETF (TECB): ETF Research Reports BlackRock Future Tech ETF (BTEK): ETF Research Reports Goldman Sachs Future Tech Leaders Equity ETF (GTEK): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacks1 hr. 54 min. ago