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Tag: domestic-business

  • Rite Aid is closing nearly 100 stores as part of its bankruptcy. See the list | CNN Business

    Rite Aid is closing nearly 100 stores as part of its bankruptcy. See the list | CNN Business


    New York
    CNN
     — 

    Rite Aid, which had filed for Chapter 11 bankruptcy protection, is now preparing to shed almost 100 stores nationwide as part of its restructuring efforts.

    The first tranche of stores to be sold — both leased and owned — is located in nine states, according to A&G Real Estate Partners, which is advising the drug store chain on its real estate portfolio. The states include California (17 stores), Maryland (4), Michigan (16), New Jersey (8), New York (17), Ohio (4), Oregon (2), Pennsylvania (17), New Hamphire (2) and Washington (10), Alabama (1), Idaho (1).

    The writing has been on the wall for some time for Rite Aid, the third-biggest standalone pharmacy chain in the US, as the entire drug store retail sector struggles to compete with Amazon and big-box chains like Walmart, Target and Costco moving deeper into the space and offering more customer-friendly alternatives to the nationwide pharmacy chains.

    Compounding its problems were legal troubles stemming from accusations of filing unlawful opioid prescriptions for customers.

    Rite Aid is in much worse financial shape than its competitors. Over the past six years, Rite Aid has tallied nearly $3 billion in losses.

    While it has secured $3.5 billion in financing and debt reduction agreements from lenders to keep the company afloat through its bankruptcy, Rite Aid said it would accelerate store closures and sell off some of its businesses, including prescription benefit provider Elixir Solutions. Bankruptcy could also help resolve the company’s legal disputes at a vastly reduced cost.

    As it reevaluates its portfolio of stores, these are the Rite Aid locations that are currently up for sale:

    • SEC Alabama Ave. & Pike St. in Monroeville, Alabama
    • 920 East Valley Blvd in Alhambra, California
    • 571 Bellevue Road in Atwater, California
    • 3029 Harbor Blvd. in Costa Mesa, California
    • 139 North Grand Ave. in Covina, California
    • 20572 Homestead Road in Cupertino, California
    • 24829 Del Pradoin Dana Point, California
    • 7859 Firestone Blvd. in Downey, California
    • 8509 Irvine Center Drive in Irvine, California
    • 15800 Imperial Hwy. in La Mirada, California
    • 30222 Crown Valley Pkwy. in Laguna Niguel, California
    • 4046 South Centinela Ave. in Los Angeles, California
    • 499 Alvarado St. in Monterey, California
    • 1670 Main St. in Ramona, California
    • 1309 Fulton Ave. in Sacramento, California
    • 901 Soquel Ave. in Santa Cruz, California
    • 19701 Yorba Linda Blvd. in Yorba Linda, California
    • 25906 Newport Road in Menifee, California
    • 1600 North Main St. in Meridian, Idaho
    • 5808 Ritchie Hwy. in Baltimore, Maryland
    • 5 Bel Air South Pkwy. in Bel Air, Maryland
    • 728 East Pulaski Hwy. in Elkton, Maryland
    • 7501 Ritchie Hwy. In Glen Burnie, Maryland
    • 35250 South Gratiot Ave. in Clinton Township, Michigan
    • 36485 Garfield Road. in Clinton Township, Michigan
    • 1900 East 8 Mile Road. in Detroit, Michigan
    • 25922 Middlebelt Road. in Farmington Hills, Michigan
    • 924 West Main St. in Fremont, Michigan
    • 715 South Clinton St. in Grand Ledge, Michigan
    • 3100 East Michigan Ave. in Jackson, Michigan
    • 15250 24 Mile Road in Macomb, Michigan
    • 1243 U.S. 31 South in Manistee, Michigan
    • 15181 Telegraph Road in Redford, Michigan
    • 320 N Main St. in Redford, Michigan
    • 51037 Van Dyke Ave. in Shelby Township, Michigan
    • 109 North Whittemore St. in St. Johns, Michigan
    • 102 North Centerville Road in Sturgis, Michigan
    • 9155 Telegraph Road in Taylor, Michigan
    • 47300 Pontiac Trail in Wixom, Michigan
    • 205-209 Main St. in Berlin, New Hampshire
    • Grove St. and Route 101 in Peterborough, New Hampshire
    • 37 Juliustown Road in Browns Mills, New Jersey
    • 1426 Mount Ephraim Ave. in Camden, New Jersey
    • 1636 Route 38, Suite 49 in Lumberton, New Jersey
    • 210 Bridgeton Pike in Mantua, New Jersey
    • 108 Swedesboro Road in Mullica Hill, New Jersey
    • Route 33 and Robbinsville- Edinburg Road in Robbinsville, New Jersey
    • 773 Hamilton St. in Somerset, New Jersey
    • 1434 South Black Horse Pike in Williamstown, New Jersey
    • 836 Sunrise Hwy. in Bay Shore, New York
    • 452 Main St. in Buffalo, New York
    • 15 Arnold St. in Buffalo, New York
    • 901 Merrick Road in Copiague, New York
    • 577 Larkfield Road in East Northport, New York
    • 2 Whitney Ave. in Floral Park, New York
    • 115-10 Merrick Blvd. in Jamaica, New York
    • 2453 Elmwood Ave. in Kenmore, New York
    • 3131 Hempstead Turnpike in Levittown, New York
    • 700-43 Patchogue-Yaphank in Medford, New York
    • 4188 Broadway in New York, New York
    • 195 8th Ave. in New York, New York
    • 1033 St. Nicholas Ave. in New York, New York
    • 593 Old Town Road in Port Jefferson, New York
    • 101 Main St. in Sayville, New York
    • 65 Route 111 in Smithtown, New York
    • 397 Sunrise Hwy. in West Patchogue, New York
    • 120 South Main St. in New Carlisle, Ohio
    • Euclid & Strathmore in East Cleveland, Ohio
    • 1204 Gettysburg Ave. in Dayton, Ohio
    • 2323 Broadview Road in Cleveland, Ohio
    • 981 Medford Center in Medford, Oregon
    • 4346 N.E. Cully Blvd. in Portland, Oregon
    • 2722 West 9th St. in Chester, Pennsylvania
    • 5990 University Blvd. in Coraopolis, Pennsylvania
    • 1709 Liberty Ave. in Erie, Pennsylvania
    • 6090 Route 30 in Greensburg, Pennsylvania
    • 301 Eisenhower Drive in Hanover, Pennsylvania
    • 1730 Wilmington Road in New Castle, Pennsylvania
    • 700 Stevenson Blvd. in New Kensington, Pennsylvania
    • 350 Main St. in Pennsburg, Pennsylvania
    • 5612 North 5th St. in Philadelphia, Pennsylvania
    • 2401 East Venango St. in Philadelphia, Pennsylvania
    • 3000-02 Reed St. in Philadelphia, Pennsylvania
    • 7941 Oxford Ave. in Philadelphia, Pennsylvania
    • 136 North 63rd St. in Philadelphia, Pennsylvania
    • 10 South Center St. in Pottsville, Pennsylvania
    • 351 Brighton Ave. in Rochester, Pennsylvania
    • 208 East Central Ave. in Titusville, Pennsylvania
    • SR 940 and Main St. in White Haven, Pennsylvania
    • 3620 Factoria Blvd SE in Bellevue, Washington
    • 11919 NE 8th St in Bellevue, Washington
    • 222 Telegraph Road in Bellingham, Washington
    • 1195 Boblett St. in Blaine, Washington
    • 17125 SE 272nd St. in Covington, Washington
    • 10103 Evergreen Way in Everett, Washington
    • 2518 196th St SW in Lynnwood, Washington
    • 3202 132nd St., S.E. in Mill Creek, Washington
    • 601 South Grady Way in Renton, Washington
    • 2707 Rainier Ave. in South Seattle, Washington

    – CNN’s David Goldman contributed to this story

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  • New York City unveils an ‘artificial intelligence action plan’ | CNN Business

    New York City unveils an ‘artificial intelligence action plan’ | CNN Business



    CNN
     — 

    The same New York City administration to launch a “Rat Action Plan” is back with an “Artificial Intelligence Action Plan.”

    Mayor Eric Adams on Monday unveiled a citywide AI “action plan” that pledged – in broad-brushstrokes – to evaluate AI tools and associated risks, boost AI skills among city employees and support “the responsible implementation of these technologies to improve quality of life for New Yorkers,” according to a statement from the mayor’s office.

    The city’s 51-page AI action plan establishes a series of steps the city will take in the coming years to help better understand and responsibly implement the technology that has taken the tech sector and broader business world by storm in recent months.

    While government use of automated technologies has often courted controversy, New York City’s approach to AI, so far, seems to be focused on laying a framework for future AI use-cases as well as engaging with outside experts and the public.

    The first step listed in the city’s AI action plan is establishing an “AI Steering Committee” of city agency stakeholders. The document goes on to list nearly 40 “actions,” with 29 of those set to be started or completed within the next year. The city said it will publish an annual AI progress report to communicate the city’s updates and implementation of the plan.

    Also on Monday, city officials said the government was piloting the first citywide AI-powered chatbot to help business owners navigate operating and growing businesses in New York City. The AI chatbot, already available in beta on the official city of New York website, was trained on information from more than 2,000 NYC Business web pages.

    The chatbot uses Microsoft’s Azure AI services, per a disclaimer on the tool.

    In a statement announcing the AI action plan, Mayor Adams acknowledged “the potential pitfalls and associated risks these technologies present,” and pledged to be “clear-eyed” about these.

    The mayor also expressed hope that the action plan will “strike a critical balance in the global AI conversation — one that will empower city agencies to deploy technologies that can improve lives while protecting against those that can do harm.”

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  • Rite Aid files for bankruptcy | CNN Business

    Rite Aid files for bankruptcy | CNN Business


    New York
    CNN
     — 

    Rite Aid filed for Chapter 11 bankruptcy protection Sunday, a casualty of a miserable environment for drug stores, exacerbated by its runner-up status to bigger chains and expensive legal battles for allegedly filling unlawful opioid prescriptions.

    The bankruptcy was not a surprise. Its bigger rivals, CVS and Walgreens, are also facing many of the same problems. They, too, are closing stores as Amazon and big-box chains like Walmart, Target and Costco serve as more customer-friendly alternatives to nationwide pharmacy chains.

    But Rite Aid is in much worse financial shape than its competitors and unable to weather the storm that has been beating down on the industry. On Thursday, it filed a notice to the US Securities and Exchange Commission saying it would be unable to file its latest quarterly financial report because it was looking at “strategic alternatives,” which is Wall Street speak for “considering bankruptcy.”

    In that filing, the company said it expected its losses would increase significantly in the past quarter, which is saying something, considering it lost about three quarters of a billion dollars between March 2022 and March 2023 — and another $307 billion between March and May this year. Over the past six years, Rite Aid has tallied nearly $3 billion in losses.

    At the beginning of June, the last time the company filed a financial report, Rite Aid had just $135.5 million of cash on hand -— and $3.3 billion in long-term debt, which exceeded the value of the company’s assets by nearly $1 billion. With rising interest rates, that debt wasn’t cheap to finance.

    “It was always a matter of when, not if, Rite Aid would file for bankruptcy,” said Neil Saunders, managing director of GlobalData, in a note to investors. “The company has been deep in the red for the past six years.”

    The company said in a statement it had secured $3.5 billion in financing and debt reduction agreements from lenders to keep the company afloat through its bankruptcy.

    It said it would accelerate its pace of store closures and sell off some of its businesses, including prescription benefit provider Elixir Solutions. Bankruptcy could also help resolve the company’s legal disputes at a vastly reduced cost.

    As part of the bankruptcy plan, Rite Aid appointed a new CEO, Jeff Stein, who will also serve as the head of restructuring and a board member. Stein, in the statement, said the company plans to remain in business.

    “With the support of our lenders, we look forward to strengthening our financial foundation, advancing our transformation initiatives and accelerating the execution of our turnaround strategy,” he said. “In doing so, we will be even better able to deliver the healthcare products and services our customers and their families rely on -— now and into the future.”

    Rite Aid has had an interim CEO since January 2023.

    Rite Aid’s losing battle against mounting debt was exacerbated by its legal troubles stemming from accusations of filing unlawful opioid prescriptions for customers.

    The Department of Justice filed suit against the company in March, claiming that it knowingly processed “unlawful prescriptions for controlled substances.” That stands in violation of the False Claims Act and Controlled Substances Act. The government accused Rite Aid of missing “obvious red flags” when it filled the prescriptions for addictive pain killers.

    When the US Justice Department filed its lawsuit, Attorney General Merrick Garland said the department would use “every tool at our disposal” to hold Rite Aid accountable for contributing to the opioid epidemic.”

    Walgreens, CVS and others settled similar lawsuits over the past few years, but they remain in better financial shape and were largely able to weather the tens of billions of dollars owed to various government agencies in settlements.

    More than half a million people have died from drug overdoses in the United States between 1999 and 2020, according to the US Centers for Disease Control and Prevention.

    Rite Aid is a distant third-largest nationwide standalone pharmacy chain in the United States — and the seventh largest pharmacy overall, when taking into account big box chains. It has more than 2,200 stores in 17 states.

    It was offered a $17 billion lifeline in 2015 when Walgreens offered to buy the chain. But the deal was met with stiff scrutiny from US regulators who feared the combination would violate federal antitrust laws and reduce competition in the drug store market.

    Ultimately, in 2017, the companies agreed to a smaller, $4.4 billion deal, in which Walgreens bought just under 2,000 Rite Aid locations, leaving Rite Aid diminished in stature and unable to compete at the scale of its bigger rivals.

    — CNN’s Nathaniel Meyersohn and Juliana Liu contributed to this report

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  • Streets ‘reek of blood:’ Gazans run out of time after Israel’s evacuation deadline | CNN

    Streets ‘reek of blood:’ Gazans run out of time after Israel’s evacuation deadline | CNN



    CNN
     — 

    Tens of thousands of Palestinians have been fleeing south through the battered streets of Gaza after the Israeli military told them to leave northern areas of the densely populated strip.

    Parts of the south are becoming even more crowded and overstretched, Gazans say, as waves of Palestinians abandon their homes in the wake of Israel’s statement, which came ahead of an anticipated ground assault by the Israel Defence Forces (IDF).

    More than half of Gaza’s 2 million residents live in the northern section that Israel said should evacuate. Many families, some of whom were already internally displaced, are now crammed into an even smaller portion of the 140-square-mile territory.

    The IDF said Saturday it would allow safe movement on specified streets between the hours of 10 a.m. and 4 p.m. local time (3 – 9 a.m. ET). Residents were advised to use this window to move from the northern Beit Hanoun to Khan Yunis in the south – a roughly 20-mile distance of rubble-strewn streets.

    The evacuation statement has been described by rights groups as well as some neighboring countries as a breach of international humanitarian law. Jordan’s foreign minister described it as a “war crime.”

    The UN’s Relief and Works Agency for Palestine Refugees (UNRWA), which was forced to move its central operations from Gaza City to a location in southern Gaza following the Israeli statement, on Saturday described the evacuation as an “exodus,” and said that “nearly 1 million people have been displaced in one week alone.”

    The evacuation advisory came after Israel imposed a complete siege on Gaza in response to a brutal attack launched a week ago by Hamas, which left at least 1,300 dead in Israel.

    At least 2,215 civilians, including 724 children and 458 women, have been killed in Gaza, according to the Palestinian health ministry, as the Israeli military continues to pound the territory.

    Palestinians who fled south, and those who are still north, are rapidly running out of food and water. There is no more electricity, and those with fuel-powered generators will soon live in complete blackout. Internet access, through which residents communicate their plight to the world, is also shrinking.

    Mohamed Hamed, a 36-year-old resident of Gaza City, moved southward to Nuseirat, a refugee camp some five kilometers north-east of Deir al-Balah – which he was told was safe.

    Hamed fled the north with 30 family members, including his extended relatives, four children and his wife, who is over eight months pregnant.

    “In this situation, we’re afraid that she goes into labor, and we wouldn’t know where to go,” he told CNN.

    The family has no access to medical care and are crammed into a single apartment with no electricity, and quickly depleting food and water.

    “There is no electricity, there is no water. Bakeries are working but these are their final hours, as the fuel they need is running out,” he said, adding that “the food we have may last us a day or two.”

    Speaking to CNN by phone, Hamed said that Nuseirat is a small area yet has received large crowds of displaced Palestinians from the north. Drinking water is only available in mineral water bottles, he said, which are dwindling as crowds rush to stock up.

    “Everything in supermarkets and shops was used up,” he said.

    Shelling in Nuseirat is intense, but not as bad as it was in Gaza City, where neighborhoods were “entirely wiped out,” he said.

    Hamed said that the time provided by the IDF for “safe passage” southward may not be enough for vast number of Palestinians that need to flee, and that some Gazans in the north refuse to leave fearing forceful displacement into Egypt.

    For many, that would mean displacement for the second time. The majority of Gaza’s residents today are already refugees from areas that fell under Israeli control in the 1948 Arab-Israeli war.

    “People are afraid of this, of being pushed to Egypt,” he said, adding that the airstrikes have been “horrifying,” with some areas being targeted for the first time despite the years of conflict between Hamas and Israel.

    But not everyone in Gaza’s north has heeded the IDF’s call to move southwards. Palestinian journalist Hashem Al-Saudi and his family have only moved from east to west of Gaza City, which is among areas the IDF told civilians to evacuate.

    Residents are forced to leave their homes to fill up water tanks, the 33-year-old told CNN by phone, which puts them at risk of being struck by Israeli missiles.

    Food is scarce, he said, and may not last his 11-member family more than three or four days.

    “I say this jokingly, but those who are on a diet are eating more than us.”

    Al-Saudi says that not only do they have nowhere to stay if they moved south, but that the route itself is unsafe. “Even those who moved south were hit by airstrikes,” he told CNN.

    “Nowhere is safe in the Gaza Strip, from Rafah (south) to Beit Hanoun in the north,” Al-Saudi said, adding that everywhere is targeted, including “homes, shelters hospitals and places of worship.”

    “Everyone on this piece of land is targeted by the Israeli military, which from the start did not differentiate between civilian and soldier.”

    CNN has geolocated and authenticated five videos from the scene of a large explosion Friday along a route for civilians south of Gaza City that Israel said the following day would be safe.

    The videos show many dead bodies amid a scene of extensive destruction. Some of those bodies are on a flatbed trailer that appears to have been used to carry people away from Gaza City. They include at least several children. There are also many badly burned and damaged cars.

    It’s unclear what caused the widespread devastation; the explosion occurred on Salah Al-Deen street on Friday afternoon. CNN has reached out to IDF for comment on any airstrikes in the same location.

    “The situation is much worse than what you see on television,” he said. Many bodies remain unidentified, and corpses are being stored in refrigerators not made for storing human remains, Al-Saudi said.

    “Streets are filled with rubble and reek of blood.”

    The Israeli government launched a complete blockade on essential goods entering Gaza earlier this week, prompting warnings from human rights groups who say the siege is in violation of international law.

    Israel, which administers most of the electricity, water, fuel and some of the food inside the Palestinian enclave, already imposes a stringent land, sea and air blockade, but used to permit some trade and humanitarian aid through two crossings that it controls.

    Refaat Alareer, 44, a literature professor in Gaza City, said Thursday – before Israel told Gazans to evacuate – the shelves in his local supermarket are emptying every day. He has been able to buy cans of tinned tuna, adding that he avoided purchasing perishable goods because the lack of electricity means refrigerated food “will rot.”

    Alareer, who lives with his wife and their six children, said his neighbors insist on leaving milk powder on the shelves – so that other parents can feed their own families.

    “I’ve never seen people this disciplined,” he said. “I didn’t buy a single thing that is more expensive than it was last week.

    “(What is) so beautiful about, you know, being in Gaza, being in Palestine, the solidarity.”

    More than half of the residents in Gaza are food insecure and live under the poverty line, according to UNRWA. Alareer warned that blue collar workers, farmers and street vendors “will suffer the most,” from the blockade.

    “We’re bracing for the worst. What happened is extremely genocidal in every sense of the word,” he added.

    Aseel Mousa, a 25-year-old freelance journalist in Gaza, said she is unable to communicate with loved ones in other parts of the enclave, as electricity supplies diminish.

    “We cannot connect with the world,” she told CNN on Thursday. “We hear the bombings, the air strikes and we don’t know where they are exactly.

    “We cannot check up on our relatives who live in different areas of the Gaza Strip, we cannot reach them as there is no internet and there is no electricity.” She said on Friday that she relocated with her family from western Gaza to the south.

    On Friday, Alareer told CNN he and his family see no choice but to remain in the north – despite Israel’s evacuation advisory – because they had “nowhere else to go.”

    “Israel bombs (are) everywhere,” he said.

    Gaza has already been under blockade since Hamas took control of the territory in 2007.

    Egypt imposes a land blockade, while Israel imposes an air, sea and land blockade. The siege was completely tightened after Hamas’ attack on Israel a week ago, and the only remaining route into or outside of the Gaza Strip is the Rafah Crossing, which connects Gaza to Egypt’s Sinai.

    While some aid has arrived in Egypt, it is yet to cross the border, which earlier this week was struck by Israel on the Palestinian side, according to Palestinian and Egyptian officials.

    Egypt on Thursday stressed that its Rafah Crossing was however open, a claim CNN could not independently verify.

    A Palestinian border official told CNN on Saturday morning that concrete slabs were being placed at the Rafah border crossing into Egypt, blocking all gates. The slabs were being placed by a winch visible on the Egyptian side of the crossing, the official said.

    The official added that hundreds of Palestinians with foreign passports have been sat in the streets for hours, waiting to cross. “The gates are closed, and no one is being let through,” he told CNN.

    CNN has reached out to Egyptian officials for comment.

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  • China’s narrowing trade slump boosts recovery prospects, but challenges persist | CNN Business

    China’s narrowing trade slump boosts recovery prospects, but challenges persist | CNN Business


    Beijing
    Reuters
     — 

    China’s exports and imports shrank at a slower pace for a second month in September, customs data showed on Friday, adding to the recent signs of a gradual stabilization in the world’s second-biggest economy thanks to a raft of policy support measures.

    The trade report should provide some encouragement to authorities, although stiff challenges remain in an economy facing persistent deflationary pressure, a long-running property crisis, a slowdown in global growth and geopolitical tensions.

    Outbound shipments in September declined 6.2% from a year ago, following a drop of 8.8% in August, and beating economists’ forecast for a 7.6% fall in a Reuters poll.

    The figures were backed up by new export orders in an official factory survey two weeks ago which showed improvement last month, partly because of a peak export shipping season for Christmas products and favorable base effects.

    “There’s increasing evidence that the cyclical upturn in the global electronics sector is driving a bottoming-out of global trade and China’s trade data is the latest sign,” said Xu Tianchen, senior economist at the Economist Intelligence Unit.

    “This gives reason for optimism about a rosier trade picture in 2024,” he said.

    South Korean exports to China, a leading indicator of China’s imports, fell at their slowest pace in 11 months in September. Semiconductors make up the bulk of their trade, signaling improving appetite among Chinese manufacturers for components to re-export in finished goods.

    Global trade activities, represented by the Baltic Dry Index, also reported notable growth in September.

    However, Lv Daliang, spokesperson of the General Administration of Customs, said at a press conference earlier on Friday that China’s trade still faces a complex and severe external environment.

    Thanks to gradual recovery in domestic demand, imports also fell at a slower pace, down 6.2%. They missed the 6.0% decline forecast in the poll, but came in better than a 7.3% contraction in August.

    That resulted in a broader trade surplus of $77.71 billion in September, compared with a $70 billion surplus expected in the poll and $68.36 billion in August.

    Overall, economists say it’s too early to make a call on how domestic demand will pan out in coming months as the crisis-hit property sector, uncertainties in employment and household income growth, as well as weak confidence among some private firms, pose risks to a durable economic rebound.

    The $18 trillion economy started losing steam from the second quarter after a brief post-Covid bounce, prompting policymakers to roll out several measures to shore up the recovery in the face of a sluggish housing market, high youth unemployment and mounting local debt repayment pressure.

    China’s consumer prices faltered and factory-gate prices shrunk slightly faster than expected last month compared with a year earlier, inflation data released earlier on Friday showed, indicating that deflationary pressures persist in the economy.

    Yet, authorities can take some comfort from recent data including upbeat factory activity and retail sales while the past Golden Week holiday travel edged up 4.1% from pre-pandemic 2019 levels.

    In order to help the economy meet the government’s annual growth target of around 5%, China is considering issuing at least 1 trillion yuan ($137.00 billion) of additional sovereign debt to fund infrastructure projects, as Beijing prepares to bring a new round of stimulus, Bloomberg News reported on Tuesday, citing people familiar with the matter.

    Most analysts have been reiterating in recent months that policymakers will need to go further than introducing piecemeal measures in order to bolster the economic recovery.

    “Whatever does emerge from Beijing over the coming months, it likely won’t be quick enough to make any meaningful difference to 2023,” said Robert Carnell, regional head of research Asia-Pacific at ING in a note.

    “At best, it should be viewed as a pain management tool for the transition to a less leveraged economy.”

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  • Samsung flags 78% profit drop as chip demand remains weak | CNN Business

    Samsung flags 78% profit drop as chip demand remains weak | CNN Business


    Hong Kong
    CNN
     — 

    Samsung warned that operating profit in the third quarter likely plunged 78% as it continues to contend with lower than usual demand for consumer devices.

    The South Korean tech giant released earnings estimates Wednesday, forecasting operating profit of about 2.4 trillion Korean won ($1.8 billion) for the three months ended September. That compares with 10.85 trillion won ($8 billion) in the same period last year.

    Revenue was also projected to drop 12.7% from a year ago.

    That continues a dreary run for the electronics maker, which has reported major losses in recent months as global economic uncertainty weighs on consumers around the world, leading many people to hold on to their cell phones and laptops longer.

    According to Counterpoint Research, “2023 is on track to be the worst year for global smartphone shipments in 10 years,” with shipments forecast to decline 6% to fewer than 1.2 billion units.

    In major markets like North America, “consumers are hesitant to upgrade their devices,” the firm noted in an August report.

    Samsung has already been feeling the effects. The firm’s operating profit plummeted 95% in the first quarter, following a record loss in its semiconductor business. It saw similar results in the second quarter.

    After a historic supply shortage during Covid, the global semiconductor industry is now seeing a glut in some areas that has driven losses for Samsung, the world’s largest memory chip and smartphone maker.

    According to consultancy Bain, “the semiconductor industry’s post-pandemic rebound boosted capacity to the extent that some foresee an oversupply.”

    In a report last month, Bain suggested the trend was merely cyclical, attributing it to “normal” ups and downs in the industry.

    Samsung has also told shareholders it anticipates a gradual comeback in global demand in the second half of the year.

    This “should lead to an improvement in earnings driven by the component business,” it said in a July earnings statement.

    “However, continued macroeconomic risks could prove to be a challenge,” the company cautioned.

    Analysts believe a downturn in memory chips will also turn around, benefiting manufacturers like Samsung.

    In a recent note to clients, Nomura analysts said they expected a recovery in the sector “to accelerate” through the rest of this year.

    “The team expects memory prices to remain flat or slightly increase in [the third quarter], then show strong growth in [the fourth quarter],” the analysts wrote, maintaining a buy rating on Samsung’s stock.

    The company’s shares climbed 3.5% in Seoul on Wednesday following its announcement.

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  • GM settles strike at Canadian plants | CNN Business

    GM settles strike at Canadian plants | CNN Business


    New York
    CNN
     — 

    A strike at General Motors’ Canadian plants is over less than a day after it started, according Unifor, the union that represents more than 4,000 autoworkers at the company.

    The strike had begun 11:59 pm Monday when Unifor said GM had refused to agree to a deal similar to the one the union previously reached with Ford. That kind of deal is known as a pattern agreement.

    The union said the company quickly gave in to union demands once the strike started.

    “When faced with the shutdown of these key facilities General Motors had no choice but to get serious at the table and agree to the pattern,” said Unifor National President Lana Payne. “The solidarity of our members has led to a comprehensive tentative agreement that follows the pattern set at Ford to the letter.”

    The union said strike actions are on hold to allow the membership to vote on the tentative agreement. The strike could resume if the rank-and-file members fail to ratify the deal.

    But it’s uncertain whether it will win approval of membership. Only 54% of Unifor members at Ford voted in favor of the deal.

    The Unifor strike occurred while GM as well as rivals Ford and Stellantis were already dealing with strikes by the United Auto Workers union. That strike had started September 15 against targeted facilities of each company. More than 25,000 UAW members are now on strike at the three companies, with nearly 10,000 of those at GM.

    “This record agreement, subject to member ratification, recognizes the many contributions of our represented team members with significant increases in wages, benefits and job security while building on GM’s historic investments in Canadian manufacturing,” said GM’s statement.

    Details of the Unifor deal were not immediately available. But the deal with Ford included a wage increase of 10% in the first year of the agreement, followed by a 2% and 3% increase over the next two years of the contract. It also restored the cost-of-living adjustments (COLA) to protect workers from rising prices.

    The Ford agreement also returned to a pension plan — rather than just 401(k)-style retirement accounts — for Unifor members hired at Ford in recent years. And it converted temporary staff who work full-time shifts into permanent employees.

    Autoworkers in both Canada and the United States used to all have COLA clauses in their contracts as well as traditional pension plans that pay retirees a set amount every month as long as they live. But the automakers got unions on both sides of the border to give up the COLA for all members and traditional pensions for new hires when the companies were in financial distress in 2007 through 2009.

    Restoring those concessions have been a major negotiation demand of both Unifor and the UAW.

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  • The IMF sees greater chance of a ‘soft landing’ for the global economy | CNN Business

    The IMF sees greater chance of a ‘soft landing’ for the global economy | CNN Business


    London
    CNN
     — 

    The International Monetary Fund (IMF) sees better odds that central banks will manage to tame inflation without tipping the global economy into recession, but it warned Tuesday that growth remained weak and patchy.

    The agency said it expected the world’s economy to expand by 3% this year, in line with its July forecast, as stronger-than-expected growth in the United States offset downgrades to the outlook for China and Europe. It shaved its forecast for growth in 2024 by 0.1 percentage point to 2.9%.

    Echoing comments made in July, the IMF highlighted the global economy’s resilience to the twin shocks of the pandemic and the Ukraine war while warning in its World Economic Outlook that risks remained “tilted to the downside.”

    “Despite war-disrupted energy and food markets and unprecedented monetary tightening to combat decades-high inflation, economic activity has slowed but not stalled,” IMF chief economist Pierre-Olivier Gourinchas wrote in a blog post. “The global economy is limping along,” he added.

    The IMF’s projections for growth and inflation are “increasingly consistent with a ‘soft landing’ scenario… especially in the United States,” Gourinchas continued.

    But he cautioned that growth “remains slow and uneven,” with weaker recoveries now expected in much of Europe and China compared with predictions just three months ago.

    The 20 countries using the euro are expected to grow collectively by 0.7% this year and 1.2% next year, a downgrade of 0.2 percentage points and 0.3 percentage points respectively from July.

    The IMF now expects China to grow 5% this year and 4.2% in 2024, down from 5.2% and 4.5% previously.

    “China’s property sector crisis could deepen, with global spillovers, particularly for commodity exporters,” it said in its report

    By contrast, the United States is expected to grow more strongly this year and next than expected in July. The IMF upgraded its growth forecasts for the US economy to 2.1% in 2023 and 1.5% in 2024 — an improvement of 0.3 percentage points and 0.5 percentage points respectively.

    “The strongest recovery among major economies has been in the United States,” the IMF said.

    The agency expects that inflation will continue to fall — bolstering the case for a “soft landing” in major economies — but it does not expect it to return to levels targeted by central banks until 2025 in most cases.

    The IMF revised its forecasts for global inflation to 6.9% this year and 5.8% next year — an increase of 0.1 percentage point and 0.6 percentage points respectively.

    Commodity prices pose a “serious risk” to the inflation outlook and could become more volatile amid climate and geopolitical shocks, Gourinchas wrote.

    “Food prices remain elevated and could be further disrupted by an escalation of the war in Ukraine, inflicting greater hardship on many low-income countries,” he added.

    Oil prices surged Monday on concerns that the latest conflict between Israel and Hamas could cause wider instability in the oil-producing Middle East. Brent crude prices were already elevated following supply cuts by major producers Saudi Arabia and Russia.

    High oil and natural gas prices, leading to skyrocketing energy costs, helped drive inflation to multi-decade highs in many economies in 2022. The latest jump in oil prices could cause a fresh bout of broader price rises.

    Bond investors are already on edge. They dumped government bonds last week in the expectation that the world’s major central banks would keep interest rates “higher for longer” to bring inflation down to their targets.

    The IMF also pointed to concerns that high inflation could become a self-fulfilling prophecy. If households and businesses expect prices to go on rising, that could cause them to set higher prices for their goods and services, or demand higher wages.

    “Expectations that future inflation will rise could feed into current inflation rates, keeping them high,” the IMF noted.

    It added that the “expectations channel is critical to whether central banks can achieve the elusive ‘soft landing’ of bringing the inflation rate down to target without a recession.”

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  • Festivalgoers, children, soldiers: What we know about the people captured by Hamas | CNN

    Festivalgoers, children, soldiers: What we know about the people captured by Hamas | CNN



    CNN
     — 

    Hamas fighters are holding as many as 150 people hostage in locations across Gaza following their raids on southern Israel Saturday, Israel’s ambassador to the United Nations said Monday.

    Their presence is complicating Israel’s response to the militant group’s deadly attack, however Ambassador Gilad Erdan told CNN Monday that the government’s priority is destroying Hamas to restore security for all Israeli citizens.

    “Of course, we want to see all of our boys, girls, grandmothers, everyone who was abducted we want to see them back home, but right now, our focus is looking at our national strategy is to obliterate Hamas terrorist capabilities,” he said.

    In a chilling development earlier Monday, Abu Obaida, the spokesperson of Hamas’ Al-Qassam Brigades, said Hamas would start executing civilian hostages if Israel targets people in Gaza without warning.

    Little evidence has emerged as to the condition of the hostages, some of whom have been identified by their families as they desperately seek answers.

    Here’s what we know so far about those being held.

    Hundreds of attendees at the Nova music festival ran across the plains of the Negev Desert near Urim, a community close to the Gaza Strip, trying to escape Hamas gunmen pursuing them in vehicles in a terrifying chase. Some were killed and others were seized by armed captors, social media videos showed.

    Details of hostages from the attack are beginning to emerge as family members recognize relatives in the clips circulating online.

    In one video that went viral, an Israeli woman and her boyfriend – identified as Noa Argamani and Avinatan Or – were shown being kidnapped. In it, Argamani was hoisted onto the back of a motorcycle and driven away as Or was apprehended and made to walk with his hands behind his back. CNN could not independently verify the video.

    “It’s very difficult when you see someone that is so close to you and you know so much being treated like this,” Amir Moadi, a roommate of Noa Argamani, told CNN, adding that he knew about five or six people who had been at the festival and have since gone missing.

    Noa Argamani, an Israeli woman, who was kidnapped by Hamas militants with her boyfriend.

    In another video authenticated by CNN, an unconscious woman who was at the festival could be seen being displayed by armed militants in Gaza as onlookers shouted “Allahu Akbar.”

    CNN later confirmed the identity of the woman as German-Israeli national Shani Louk.

    Ricarda Louk, Shani’s mother, told CNN that she last spoke to her daughter after hearing rockets and alarms sounding in southern Israel, calling to see if she’d made it to a secure location. Shani told her mother she was at the festival with few places to hide.

    “She was going to her car and they had military people standing by the cars and were shooting so people couldn’t reach their cars, even to go away. And that’s when they took her,” Ricarda told CNN, adding that she hopes to see her daughter again, but the situation is bleak.

    “It looks very bad, but I still have hope. I hope that they don’t take bodies for negotiations. I hope that she’s still alive somewhere. We don’t have anything else to hope for, so I try to believe,” she said.

    Hamas fighters took hostages in the border community Be’eri, and the town of Ofakim, 20 miles east of Gaza, IDF spokesman Brig. Gen. Daniel Hagari said on Saturday, adding that the two locations were the “main focal points” of the unfolding crisis.

    In a televised address, he said that there were special forces with senior commanders in the two communities, and fighting was ongoing in 22 locations.

    One video, geolocated by CNN to Be’eri, appears to show Hamas militants taking multiple Israelis captive.

    Residents in Be’eri and another community on Israel’s border with Gaza, Nir Oz, told the country’s Channel 12 television station that assailants were going door to door, trying to break into their homes.

    Channel 12 also reported that infiltrators had taken hostages in Netiv HaAsara. Israeli authorities did not immediately confirm any details about those reports.

    One Israeli mother told CNN she had been on the phone with her children, ages 16 and 12, who were home alone when they heard gunshots outside and people trying to enter. Then, over the phone, she heard the door break down.

    “I heard terrorists speaking in Arabic to my teenagers. And the youngest saying to them ‘I’m too young to go,’” the mother said. “And the phone went off, the line went off. That was the last time I heard from them.” CNN is not identifying the mother and her children for safety reasons.

    Another Israeli father told CNN he suspects his wife and young daughters may have been abducted while visiting Nir Oz. He said he recognized his wife in a viral video that shows a group of people being loaded on the back of a truck flanked by Hamas militants, while chants of “Allahu Akbar” ring out.

    “I don’t even know what the situation is regarding the hostages, and the situation is not looking good,” Yoni Asher said, adding that he tracked his wife’s phone and learned that it was located in Gaza.

    In another video, geolocated by CNN to Gaza’s Shejaiya neighborhood, a barefoot woman is pulled from the trunk of a Jeep by a gunman and then forced into the backseat of the car. Her face is bleeding, and her wrists appear to be cable-tied behind her back. The Jeep also appears to have an IDF license plate, suggesting it may have been stolen and brought into Gaza.

    Al Qassam Brigades claimed to capture “dozens” of Israeli soldiers on Saturday.

    “We bring good news to our (Palestinian) prisoners and our people that the al Qassam Brigades have dozens of captured (Israeli) officers and soldiers in their hands,” the group’s spokesman Abu Obaida said in a post on Telegram. “They have been secured in safe places and resistance tunnels.”

    Video geolocated and authenticated by CNN shows at least one Israeli soldier being taken prisoner.

    The video, posted to Hamas’ official social media accounts, shows militants yank two clearly terrified and stunned soldiers out of a disabled tank. It’s unclear from the video how the tank was disabled, but Hamas has used drones to drop bombs onto Israeli tanks before.

    One of the soldiers is then seen in a short snippet of video being kicked on the ground by the militants. In the next clip, the soldier is seen lying motionless on the ground.

    The second soldier is seen being led away by Hamas militants. A third soldier – his face very bloody – is seen lying on the ground motionless near the tank track. CNN does not know the current whereabouts or status of the three soldiers.

    A second video, taken afterward, shows a number of different armed men around the tank. The three soldiers are nowhere to be seen.

    The armed men are then seen pulling a fourth Israeli soldier from the tank. The soldier is motionless as he’s dragged down the side of the tank and onto the ground. The armed men are seen stomping on his body.

    On Monday, the sister of an Israeli soldier told CNN’s Christiane Amanpour the soldier called her and their parents to say goodbye before she was kidnapped by militants.

    “The last call my sister made was on the 7th of October, Saturday, 6:30 a.m.,” Alexandra Ariev said about her sister Karina. “She called me, then my parents. She basically called to say goodbye, that she loved us.”

    Karina Ariev is believed to have been captured by Hamas militants.

    Karina Ariev, a 19-year-old corporal, was stationed at the Nahal Oz base at the border with Gaza.

    On Saturday, family members identified the soldier’s bloodied face in a Telegram video, where men can be heard shouting “this is nothing, we are just starting.” After the family reported the video to Israeli authorities, Alexandra Ariev said they eventually confirmed Karina had been abducted.

    Alexandra believes her sister is a hostage in Gaza, because the family “didn’t get any match with the DNA from the corpses found on the base,” she told Amanpour.

    “I’m devastated inside, and my parents are crying all day long,” she said from Jerusalem.

    The attack has impacted families around the world, with a growing list of foreign nationals kidnapped.

    US President Joe Biden said in a statement Monday that it is “likely” that American citizens may be among those being held hostage by Hamas, and that his administration is working with Israeli officials on “every aspect of the hostage crisis.”

    He noted that there are American citizens whose whereabouts remain unaccounted for.

    Two Mexican nationals, three Brazilians, a Nepali student and a British citizen are also among those missing.

    Two Mexican nationals, a woman and a man, have “presumably” been taken hostage by Hamas, Mexico’s Foreign Minister Alicia Barcena said on Sunday.

    The Brazilians and 26-year-old British citizen Jake Marlowe were all at the Nova music festival near the Gaza border which was attacked on Saturday.

    Marlowe, who was working there as a security guard, has been missing since Saturday morning, his mother told the Israeli Embassy in the UK.

    A source at the German Foreign Ministry told CNN late Sunday that it “has to assume” there are German citizens amongst those kidnapped by Hamas. “As far as we know, they are all people who have Israeli citizenship in addition to German citizenship,” the source said, but would not comment on individual cases.

    Eleven Thai nationals have been taken hostage, a spokesperson for Thailand’s Foreign Ministry said on Monday.

    Israel has long been a major destination for Thai migrants, most of whom work agricultural jobs. There are approximately 30,000 Thai workers in Israel, according to the Foreign Ministry, and over a thousand have requested help to be evacuated.

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  • Elon Musk’s X adds to fog of war at outset of Israel-Hamas conflict | CNN Business

    Elon Musk’s X adds to fog of war at outset of Israel-Hamas conflict | CNN Business



    CNN
     — 

    Misinformation has run rampant on Elon Musk’s social media platform X in the 48 hours since Hamas militants’ surprise attack on Israel, with users sharing false and misleading claims about the conflict and Musk himself pointing users to an account known for spreading misinformation.

    Multiple users over the weekend shared a fake White House news release falsely claiming the US was sending billions of dollars in new aid to Israel in response. Accounts on X with hundreds of thousands of followers in total quickly spread the doctored White House press release after it appeared online on Saturday. Social media influencer Jackson Hinkle, who was among those shared the fake release, claimed it was a slap in the face to Ukraine, which has been pleading with Washington for more money to defend itself from Russia.

    Musk himself added to the information chaos on Sunday by recommending X users follow the Israel-Hamas conflict by following an account known for spreading misinformation, including a fake report earlier this year of an explosion at the Pentagon.

    Musk and Hinkle later deleted their posts. Musk later posted: “As always, please try stay as close to the truth as possible, even for stuff you don’t like.”

    Elsewhere on X (formerly known as Twitter), an account impersonating the Jerusalem Post shared a bogus report that Israeli Prime Minister Benjamin Netanyahu had been hospitalized. (The account was later suspended.)

    CNN has requested comment from Musk and X on the posts related to the Israel-Gaza conflict.

    A slew of mischaracterized videos and other posts went viral on the platform over the weekend.

    One video that is purported to show Israel generals after being captured by Hamas fighter was viewed more than 1.7 million times by Monday. The video however actually shows the detention of separatists in Azerbaijan.

    Another post viewed more than 500,000 times on X purported to show an airplane getting shot down with the hashtag #PalestineUnderAttack. The video is in fact a clip from the video game Arma 3, as was later noted in a “community note” appended to the post.

    Community notes allow users on X to fact-check false posts on the platform. While notes were appended to both of these false posts, they often come after a false post has been viewed thousands – or in some cases millions – of times.

    X has relied more heavily on community notes to moderate content since Musk laid off thousands of the company’s employees, including many responsible for detecting and addressing false claims, following his takeover of the platform last year.

    Israel’s National Cyber Directorate, one of the government’s main cyber defense agencies, on Monday took to X to urge people not to spread unverified information. “[T]he rumor mill is overflowing,” the directorate wrote in Hebrew. The Anti-Defamation League also raised concerns in a statement Saturday about false and antisemitic claims being spread on the platform, including posts by a verified user falsely claiming that Israel helped to facilitate 9-11 on US soil, which have been viewed thousands of times.

    The viral nature of the misinformation has alarmed experts on information operations, offering a fresh example of social platforms’ struggle to deal with a flood of falsehoods during a major geopolitical event.

    “In times of war, social media becomes a propaganda battlefield; there is always an element of disinformation and exaggeration,” said Emerson Brooking, senior resident fellow at the Atlantic Council’s Digital Forensic Research Lab. “Today, X is the main platform where this online battle plays out.”

    Brooking said changes to X policy under Musk’s ownership have incentivized propagandists and scam artists. Any user can now purchase a “verification” checkmark on X by signing up for the platform’s $8 per month subscription program, and their posts are then boosted by the platform’s algorithm and eligible for monetization.

    “Paid verification means that you cannot distinguish between a vetted journalist and a scam artist,” Brooking told CNN. “The for-profit ‘views’ system incentivizes accounts to impersonate news outlets and to post as frequently as possible, drawing from whatever source they can or just making things up.”

    Twitter has long played a pivotal role in information sharing during conflicts, from the Arab Spring to the 2014 and 2022 invasions of Ukraine, and during previous violence in Israel and Gaza.

    Viral misinformation has always existed on the platform, but it has become particularly pronounced under Musk’s stewardship, experts say.

    “In the past decade, every conflict has inevitably bred a digital “fog of war,” where both sides, and their supporters, try to use social platforms to spin the narrative in their favor,” Joe Galvin, a journalist who has specialized in open-source intelligence for more than a decade, told CNN Monday.

    “The volume and reach of misinformation today, though, far exceeds what we saw in the early social media era conflicts, and is exacerbated by platforms like X, which has taken the guardrails off and allows the most egregious types of disinformation to run rampant,” Galvin said.

    He said other platforms that have little or no guardrails including the social media messaging app Telegram are also hotbeds of misinformation, but X is unique given Musk’s behavior.

    “Even the owner of X takes part in the chaos, promoting accounts that are known to spread falsehoods to his 150 million followers. The fact is that malicious users, state-backed and otherwise, have become better at spreading falsehoods, with more sophisticated networks being built and better technology – including AI – being used. The platforms are in a perpetual state of catch-up.”

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  • Pressure to fill House speaker vacancy builds amid crisis in Israel | CNN Politics

    Pressure to fill House speaker vacancy builds amid crisis in Israel | CNN Politics



    CNN
     — 

    The House speakership drama enters a new week under increased urgency as Israel declared war Sunday following unprecedented surprise attacks by Hamas.

    Kevin McCarthy’s unprecedented ouster as speaker leaves the House iin uncharted legal territory regarding what it can do under acting Speaker Patrick McHenry. When Congress reconvenes Monday, lawmakers will be under pressure to elect a new speaker swiftly amid the crisis in Israel, which has prompted calls from within the Republican Party to speed up their timeline given the national security implications of keeping the role vacant.

    As the Biden administration looks to provide additional assistance to Israel, officials were unsure Saturday about what could be accomplished without a sitting speaker. While McHenry is serving as speaker pro tempore, he has little power outside of recessing, adjourning or recognizing speaker nominations, and it’s unclear whether he can participate in intelligence briefings on the crisis in Israel.

    Democratic House Minority Leader Hakeem Jeffries said Sunday that he had conversations with the White House and the National Security Council on Saturday, but he has not yet met with the Gang of Eight – which typically includes the top leaders and heads of the intelligence committees in both parties and both chambers.

    “I do anticipate that we’ll have the opportunity to have a secure briefing at some point next week,” Jeffries told CNN’s Dana Bash on “State of the Union.”

    Jeffries said it is his understanding that the Biden administration can make some decisions regarding aid to Israel without waiting for Congress and urged the administration to do so, adding that he expects “it will provide whatever assistance it can.”

    House Foreign Affairs Chairman Mike McCaul told Bash Sunday that there is currently $3.3 billion in foreign military financing already appropriated that the president can use.

    The Texas Republican also called McCarthy’s ouster “dangerous.”

    “I look at the world and all of the threats that are out there and what kind of message are we sending to adversaries when we can’t govern, when we are dysfunctional, when we don’t even have a speaker of the House?” McCaul said on “State of the Union.”

    McCarthy on Saturday slammed his Republican colleagues for removing him from office last week, and stressed the impact of a speakerless House on national security. “Why would you ever remove a speaker during a term to raise doubt around the world?” McCarthy asked in a Fox News interview.

    McCarthy announced shortly after his ouster that he would not seek the speakership again, making room for House Majority Leader Steve Scalise of Louisiana and Ohio Rep. Jim Jordan to launch their bids for the seat. Former President Donald Trump has thrown his support behind Jordan. Oklahoma Rep. Kevin Hern announced Saturday that he had decided not to run, saying “I believe a three-man race for Speaker will create even more division and make it harder to elect a Speaker.”

    House Republicans are scheduled to hold a candidate forum on Tuesday and an internal election on Wednesday. But it’s unclear when the floor vote will happen, and the timeline is contingent on whether moderate GOP lawmakers can rally around Scalise or Jordan, who are among the hardliners of the party.

    “We have to get a speaker elected this week so we can get things on the floor like replenishing the Iron Dome,” McCaul told Bash on Sunday – referring to Israel’s rocket defense system, which was developed with help from the United States. He added that the House should look to pass a resolution condemning Hamas “by unanimous consent whether or not we have a speaker in place because I think we cannot wait. We have to get that message out as soon as possible.”

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  • Why you should care about the global rout in government bonds | CNN Business

    Why you should care about the global rout in government bonds | CNN Business


    London
    CNN
     — 

    A slump in government bonds around the world has pushed up the cost of some nations’ debt to levels not seen in more than a decade. That’s bad news for governments in the red but also for the wallets of millions of mortgage borrowers, stock investors and businesses.

    The sell-off has been fueled by expectations among investors that the world’s major central banks will keep interest rates “higher for longer” to bring inflation down to their targets.

    It works like this: Governments looking to raise cash for public services and investments issue bonds. A bond provides a way to borrow money from investors for a set length of time, with the obligation to make regular interest payments.

    When official interest rates rise, so do investors’ expectations for returns on bonds, known as yields. This creates an incentive for investors to sell the bonds they currently hold and buy newly issued ones that offer higher interest payments. Selling bonds reduces prices. So, in short, when yields rise, bond prices fall.

    And yields have most definitely been rising: The yield on 30-year US government bonds, also known as Treasuries, hit 5% on Tuesday for the first time since 2007. In the United Kingdom, the yield on 30-year bonds also reached 5% this week, the highest level in more than two decades.

    Yields on German long-dated bonds are back to levels last seen on the eve of the eurozone debt crisis in 2011. Yields on Italy’s 10-year bonds hit 5% on Wednesday, the highest level since 2012, when that crisis was in full swing.

    Here’s why you should care.

    The yields on local government bonds are usually used by banks to price mortgages.

    The disastrous “mini” budget unveiled by former UK Prime Minister Liz Truss in September last year provided a stark illustration of that relationship. Her plan to borrow tens of billions of pounds to fund tax cuts spooked bond investors who feared that the country’s finances were on an unsustainable path.

    The resulting sell-off in UK government bonds — called “gilts” — caused yields to shoot up, taking mortgage costs higher with them.

    The average interest on a two-year fixed-rate mortgage soared to 6.47% at the start of November 2022, according to data from product comparison website Moneyfacts, the highest level since the depths of the global financial crisis in August 2008.

    Early morning sun illuminates streets of residential terraced houses, on September 17, 2023 in Bath, England. Soaring interest rates and falling prices has meant the end of the UK's 13-year housing market boom potentially leading to a wider house price crash.

    That meant hundreds of pounds more a month in mortgage payments. Before higher mortgage rates kicked in, some panicked homeowners rushed to refinance their fixed-rate loans earlier than planned, accepting a financial penalty for doing so.

    Mortgage rates had been falling back since the drama last fall but are now back to 6.47%, this month’s data from Moneyfacts shows.

    In the United States, mortgage rates tend to track the yield on 10-year Treasuries, and that yield has risen 0.27 percentage points since late September.

    On Thursday, government-backed mortgage provider Freddie Mac announced that the average interest on a 30-year fixed-rate mortgage had hit 7.31% in the week ending September 28 — its highest level since 2000.

    “Higher mortgage rates create a standoff between potential buyers, who face some of the highest borrowing rates since 2000, and sellers, who may already enjoy a low fixed-rate mortgage and thus are less incentivized to sell,” Andrew Sheets, global head of corporate credit research at Morgan Stanley, told CNN.

    Surging government bond yields are probably coming for your stock portfolios too.

    Shares typically lose value when the yields on government debt rise, as investors can now get high returns — and a steady income — from less risky assets.

    Take the yield on 10-year Treasuries: at 4.78%, it is more than twice as high as the average yearly dividend paid out by the companies making up the S&P 500 index (SPX).

    “The higher the gilt yield goes, the less inclined, or obliged, investors will feel to take risk and pay up for other asset classes, such as shares,” Russ Mould, investment director at AJ Bell, told CNN.

    Stock indexes have tumbled on both sides of the Atlantic in recent weeks. The S&P 500 and the tech-heavy Nasdaq Composite (NDX) have shed 4% and 2.3% respectively since the Federal Reserve said late last month that it could hike rates once more this year and expected to make fewer rate cuts in 2024.

    The STOXX Europe 600 has sunk 4.5% and London’s FTSE 100 4.3% in that time.

    “Income is back,” analysts at BlackRock, the world’s biggest asset manager, wrote in a note Monday, recommending investments in short-dates US Treasuries.

    Stocks have also taken a hit in recent weeks as rising oil prices, an ailing Chinese economy and the prospect of another government shutdown in the United Stated have unnerved investors.

    High official interest rates in America and Europe have also raised the cost of borrowing for businesses.

    “Higher interest rates make borrowing less attractive, and we’ve already seen a sharp slowing of bank lending that we think is consistent with this idea,” said Sheets at Morgan Stanley.

    “It’s important to note that slower credit growth, which generally means a cooler economy, is precisely what the Federal Reserve is trying to achieve through its large recent rate hikes,” he added.

    Higher yields also mean that the government must pay more to service its debt — with less money available to spend elsewhere.

    The US government is currently sitting on a $33 trillion debt pile and is expected to incur more than $1 trillion in average annual interest costs over the next decade.

    In March, when gilt yields were much lower than now, the UK’s public spending watchdog said it expected the annual interest paid on the government’s pile of debt to peak at £115 billion ($140 billion) this year. That’s almost three times as much as the UK government plans to spend in 2023 on a key benefit for children and people with disabilities.

    Rising bond yields mean that “for any given level of borrowing, more must be spent on debt interest, leaving less scope to finance other priorities,” the Office for Budget Responsibility said in its March forecast.

    Higher gilt yields give politicians “less wiggle room to ease [the] cost-of-living pain through tax cuts or public sector pay offers,” Susannah Streeter, head of money and markets at Hargreaves Lansdown, wrote in a note Wednesday.

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  • Nobel Prize awarded for discovery of quantum dots that changed everything from TV displays to cancer imaging | CNN

    Nobel Prize awarded for discovery of quantum dots that changed everything from TV displays to cancer imaging | CNN



    CNN
     — 

    The 2023 Nobel Prize in chemistry has been awarded to a trio of scientists who worked to discover and develop quantum dots, used in LED lights and TV screens, as well as by surgeons when removing cancer tissue.

    The prize was won by Moungi Bawendi, Louis Brus and Alexei Ekimov, the Nobel committee for chemistry announced in Stockholm on Wednesday.

    “For a long time, nobody thought you could ever actually make such small particles. But this year’s laureates succeeded,” said Johan Aqvist, chair of the committee.

    The scientists were lauded as “pioneers in the exploration of the nanoworld” – in which matter starts to be measured in millionths of a millimeter. At this level, strange phenomena start to occur called “quantum effects.”

    Quantum dots consist of just a few thousand atoms. In terms of size, one quantum dot is to a soccer ball as a soccer ball is to the Earth.

    When light is passed through quantum dots they emit a specific color. This can be finely tuned and is determined by the size of the dots. The bigger dots glow red, while the smallest glow green or blue.

    The slightest of changes in the size of the particle can change its hue right across the spectrum of the color wheel.

    “We can tune these dots to fluoresce at any color that a given application requires,” Michael Edelman, CEO of UK-based quantum manufacturer Nanoco, told CNN.

    The laureates’ work has allowed scientists to capitalize on some of the properties of the nanoworld, and quantum dots are now found in living rooms and operating theaters across the world.

    They are now widely used in TVs and have several advantages over traditional LCD panels, creating more vibrant and accurate colors, as well as requiring less energy to operate.

    The dots are also widely used in medical diagnostics. Doctors use them to illuminate molecules that can bind themselves to cancer tumors, allowing the surgeon to distinguish the healthy tissue from the diseased.

    The Nobel committee explained how the scientists’ work had helped develop quantum dots.

    In the 1980s, Ekimov created size-dependent quantum effects in colored glass. “The color came from nanoparticles of copper chloride and Ekimov demonstrated that the particle size affected the color of the glass via quantum effects,” the committee said.

    A few years later, Brus became the first scientist to prove size-dependent quantum effects in particles floating freely in a liquid.

    In 1993, Bawendi then changed the chemical production of quantum dots, resulting in what the committee called “almost perfect particles.” This development allowed the dots to be used in applications.

    Bawendi, a professor at the Massachusetts Institute of Technology, and Brus, professor emeritus at Columbia University, are American. Ekimov is Russian and works for Nanocrystals Technology Inc.

    The deliberations of the Nobel committee are usually shrouded in total secrecy. No shortlists for the Nobel prizes are revealed and the winners are called shortly before the official announcement.

    But the chemistry committee inadvertently published the name of the winning trio before the official announcement on Wednesday.

    Swedish newspaper Aftonbladet published a copy of an email it said was from the academy, Reuters reported. Aqvist told Reuters ahead of the announcement that the email had been a “mistake” and stressed that a final decision had not been made. But hours later, the leaked names were confirmed as laureates.

    “Let me say that this is of course, very unfortunate. We deeply regret what happened for sure,” Hans Ellegren, secretary general of Royal Swedish Academy of Sciences, said at the announcement ceremony.

    “There was a press release sent out for still unknown reasons. We have been very active this morning to trying to find out what actually happened but at this place, we don’t know that. we deeply regret that this happened. The important thing is that it did not affect the awarding of the prize.”

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  • The fate of this consumer watchdog is in the hands of the Supreme Court | CNN Business

    The fate of this consumer watchdog is in the hands of the Supreme Court | CNN Business


    New York
    CNN
     — 

    On Tuesday, the Supreme Court began hearing oral arguments in a case that will determine the fate of the Consumer Financial Protection Bureau.

    The case was brought on by the Community Financial Services Association of America, a trade group representing payday lenders.

    The group scored a victory last year in a case it brought before the US Court of Appeals for the Fifth Circuit, in New Orleans. The three-judge panel ruled the CFPB’s funding violates the Constitution’s Appropriations Clause and separation of powers. The Supreme Court will have the final say on that, however.

    The consumer watchdog agency was created after the 2008 financial crisis by way of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The agency was the brainchild of Democratic Sen. Elizabeth Warren. She began advocating for it in 2007 when she was a Harvard Law School professor.

    The broad purpose of the CFPB is to protect consumers from financial abuses and to serve as the central agency for consumer financial protection authorities.

    Prior to the CFPB’s formation, “[c]onsumer financial protection had not been the primary focus of any federal agency, and no agency had effective tools to set the rules for and oversee the whole market,” the agency said on its site.

    The CFPB is funded by the Federal Reserve in an effort to keep the agency independent from political pressure. It also means that the agency doesn’t depend on Congressional appropriations funds.

    While there are critics of the agency’s current structure and funding, it has saved consumers money, made it easier for them to seek redress and to get better clarity and more tailored responses from companies when they have a problem with their accounts, loans or credit reports.

    “Today virtually all financial transactions for residential real estate in the United States depend upon compliance with the CFPB’s rules, and consumers rely on the rights and protections provided by those rules,” the Mortgage Bankers Association, the National Association of Homebuilders and the National Association of Realtors said in an amicus brief to the Supreme Court.

    For instance, the CFPB recently ordered Bank of America to pay $100 million to customers and $90 million in penalties saying that the nation’s second-largest bank harmed consumers by double-dipping on fees, withholding credit card rewards and opening fake accounts.

    The CFPB also took action against Wells Fargo after the agency found the bank had been engaging in multiple abusive and unlawful consumer practices across several financial products between 2011 and 2022 — from auto loans to mortgage loans to bank accounts.

    The agency ordered the bank to pay a $1.7 billion civil penalty in addition to more than $2 billion to compensate consumers.

    The Supreme Court’s decision, which likely won’t be announced until the spring of 2024, has far-reaching implications.

    If the Supreme Court finds the CFPB’s funding structure unconstitutional, it could shutter the agency and invalidate all of its prior rulings.

    “Without those rules substantial uncertainty would arise as to how to undertake mortgage transactions in accordance with federal law,” the associations said in their joint brief. “The housing market could descend into chaos, to the detriment of all mortgage borrowers,” they added.

    It could also call into question the constitutionality of other government agencies like the Federal Reserve and the Federal Deposit Insurance Corporation that also aren’t funded by Congressional appropriations.

    “We are confident in the constitutionality of the statute that created the CFPB within the Federal Reserve System and provides its funding,” Sam Gilford, a spokesperson for the CFPB, told CNN in a statement. “We will continue to carry out the vital work Congress has charged us to perform.”

    There’s also a way for the Supreme Court to change the CFPB’s funding structure in a way that wouldn’t invalidate prior rulings, said Joseph Lynyak III, a partner at the law firm of Dorsey & Whitney and a regulatory reform expert.

    “This result would be far more probable rather than voiding the last decade of the CFPB’s activity,” he added.

    From listening to the case on Tuesday, though, Lynyak believes the Supreme Court will rule that the CFPB’s funding structure is constitutional.

    “As we have argued from the outset, the CFPB’s unique funding mechanism lacks any contemporary or historical precedent,” said Noel Francisco, a lawyer arguing on behalf of those challenging the constitutionality of the CFPB’s funding structure.

    He added that it “improperly shields the agency from congressional oversight and accountability, and unconstitutionally strips Congress of its power of the purse under the Appropriations Clause of the Constitution.

    But both Republican and Democratic-appointed justices told Francisco on Tuesday they could not understand the crux of his argument.

    “I’m at a total loss,” said Justice Sonia Sotomayor. Echoing her remarks, Justice Amy Coney Barrett said, “we’re all struggling to figure out what’s the standard that you would use.”

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  • How to choose the best student loan repayment plan | CNN Politics

    How to choose the best student loan repayment plan | CNN Politics


    Washington
    CNN
     — 

    Millions of borrowers are required to make their monthly student loan payment for the first time in three-plus years in October, but there are several repayment plans available that could make the transition easier.

    Borrowers will be on the same payment plan they were before the pandemic pause started in March 2020, but they may want to consider switching to a different plan if their financial situation has changed.

    Plus, there’s also a new repayment plan, known as SAVE (Saving on a Valuable Education), that launched this summer and could potentially lower monthly payments for millions of borrowers.

    Borrowers can use Federal Student Aid’s online “Loan Simulator” to compare their estimated payments under different repayment plans. They can switch plans at any time, for free, by contacting their student loan servicer or by submitting an application to Federal Student Aid.

    Here are some things to consider when exploring your payment options:

    Standard 10-year plan: When entering repayment for the first time, borrowers are automatically enrolled in the Standard Repayment Plan. These payments are based on how much debt a borrower has and sets a fixed monthly amount to ensure it’s all paid off, with interest, in 10 years.

    Income-driven plans: If a borrower is struggling to afford monthly payments, an income-driven plan – of which there are four types, including the new SAVE plan – may be a good option. These plans calculate monthly payments based on a borrower’s income and family size and are meant to keep payments affordable for low-income borrowers. Monthly bills could be as low as $0.

    Other non-income-related plans: The extended and graduated repayment plans could also lower a borrower’s monthly payment without calculating the amount based on income. They could be a good option for people who will eventually earn high salaries. The extended plan will spread payments over as many as 25 years. The graduated plan usually has a 10-year term, but payments start small and grow over time.

    Income-driven repayment plans could be good options for borrowers who feel as though their monthly payment is too high on the 10-year standard plan or on the extended and graduated plans. The four plans are called SAVE, Pay As You Earn, Income-Based Repayment and Income-Contingent Repayment.

    Under these income-driven plans, a borrower is required to pay a certain portion of their discretionary income, or what income is left after paying for family necessities such as rent, food and clothes.

    Generally, monthly payments under an income-driven plan go up when a borrower’s income goes up – or payments go down when a borrower has less discretionary income. Borrowers are required to recertify every year, which means payments will adjust if their income or family size has changed.

    The newest income-driven plan, SAVE, offers the most generous terms when it comes to lowering a borrower’s monthly bill. Once fully phased in next year, it will require some borrowers with undergraduate loans to pay just 5% of their discretionary income, down from the 10% required by most income-driven plans. SAVE also includes an interest subsidy so that debts don’t grow while a borrower makes payments.

    Borrowers enrolled in income-driven repayment plans may also see their remaining student loan debt forgiven after making enough qualifying payments. The time to forgiveness varies by borrower and plan but won’t be longer than 25 years’ worth of payments.

    Eligibility for the income-driven repayment plans depends on what kind of federal student loans a borrower has, their income and when the loans were taken out. Most federal student loan borrowers are eligible for SAVE.

    Borrowers enrolled in the Standard Repayment Plan will usually pay the least amount over time. That’s because they will be finished paying in 10 years, leaving less time for interest to accrue.

    Borrowers may pay even less over time if they “prepay.” They are allowed to pay an extra amount, in addition to what’s required, at any time. Because of interest, this could also lower the total amount they end up paying under the Standard Repayment Plan.

    Parents who borrow to help finance their child’s education may have federal Parent PLUS loans, which are not eligible for all of the repayment plans.

    Like with other loans, borrowers with Parent PLUS loans are enrolled in the Standard Repayment Plan by default and are eligible to switch into the graduated and extended plans.

    Parent PLUS loans are not eligible for income-driven plans – but there is a workaround. If borrowers first consolidate their Parent PLUS loans into a Direct Consolidation Loan, they are then allowed to enroll in one type of income-driven plan – the Income-Contingent Repayment Plan – according to the Institute of Student Loan Advisors, a nonprofit that offers free student loan assistance.

    Parent PLUS borrowers will not be able to enroll in the newest income-driven plan, SAVE, even if they consolidate.

    It’s worth noting that the Income-Contingent Repayment Plan will close next year to new borrowers, except to those with consolidation loans that repaid a Parent PLUS loan, according to Department of Education rules.

    Marriage could result in a significant increase for borrowers enrolled in an income-driven plan because a spouse’s income will be included in the payment calculation.

    But some married borrowers who file taxes separately can shield their spouse’s income to get a lower monthly student loan payment. This is true under the SAVE, Income-Based Repayment and Income-Contingent Repayment plans.

    Borrowers enrolled in the 10-year standard plan won’t see a change after getting married.

    The Public Service Loan Forgiveness program could be a great option for borrowers with a lot of student loan debt who work for a nonprofit organization or the government.

    Qualifying borrowers will see their remaining student debt canceled after making 120 monthly payments. But they must be enrolled in the SAVE, Pay as You Earn, Income-Based or Income-Contingent plans.

    Borrowers with older, federally owned Federal Family Education Loans (FFEL) are not normally eligible for the Public Service Loan Forgiveness Program. But under a one-time waiver, those borrowers could get credit for past payments if they consolidate their FFEL loans by the end of 2023.

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  • Government on brink of shutdown ahead of midnight deadline as McCarthy slates last-minute vote | CNN Politics

    Government on brink of shutdown ahead of midnight deadline as McCarthy slates last-minute vote | CNN Politics



    CNN
     — 

    Federal agencies are making final preparations with the government on the brink of a shutdown and congressional lawmakers racing against Saturday’s critical midnight deadline – as House Speaker Kevin McCarthy mounts a last-minute push to avert the lapse in funding.

    McCarthy announced that the House will vote on a 45-day short-term spending bill Saturday, and it will include the natural disaster aid that the White House requested.

    The bill does not include $6 billion in funding to aid Ukraine, a key concession that many House Republicans demanded and a blow to allies of Ukrainian President Volodymyr Zelensky, who lobbied Congress earlier this month for additional assistance.

    Asked if he is concerned that a member, including Republican Rep. Matt Gaetz of Florida, could move to oust him over this bill, McCarthy replied, “If I have to risk my job for standing up for the American public, I will do that.”

    Infighting among House Republicans has played a central role in bringing Congress to a standoff over spending – and it is not yet clear how the issue will be resolved, raising concerns on Capitol Hill that a shutdown, if triggered, may not be easy to end.

    Democrats in the House have been trying to slow down passage of the GOP-led continuing resolution throughout the day Saturday, objecting to being forced to vote on a bill just introduced and wanting to keep Ukraine aid. It’s unclear how long Democrats will stall the House from voting.

    House Republicans met throughout Saturday morning, seesawing between options for how to proceed. Republicans including veteran appropriators and those in swing districts pushed to bring a short-term resolution to keep the government funded for 45 days to the House floor for a vote Saturday.

    McCarthy has faced threats to keeping his job throughout the month if he works with Democrats as he endures a consistent resistance from the hardline conservatives in his own party.

    A shutdown is expected to have consequential impacts across the country, from air travel to clean drinking water, and many government operations would grind to a halt – though services deemed essential for public safety would continue.

    Both chambers are scheduled to be in session Saturday, just hours before the deadline. The Senate was expected to take procedural steps to advance their own plan to keep the government funded – GOP Sen. Rand Paul had vowed all week to slow that process beyond the midnight deadline over objections to the bill’s funding for the war in Ukraine. The Senate is now waiting to see how the House developments shake out before proceeding.

    But Paul told CNN on Saturday afternoon that he won’t slow down the Senate’s consideration of the House GOP’s 45-day spending bill, if it passes the House and the Senate takes it up, allowing the Senate the ability to move the bill quickly – though any one other senator could slow that down beyond the midnight deadline.

    House Republicans have so far thrown cold water on a bipartisan Senate proposal to keep the government funded through November 17, but they have failed to coalesce around a plan of their own to avert a shutdown amid resistance from a bloc of hardline conservatives to any kind of short-term funding extension.

    “After meeting with House Republicans this evening, it’s clear the misguided Senate bill has no path forward and is dead on arrival,” McCarthy wrote on X. “The House will continue to work around the clock to keep government open and prioritize the needs of the American people.”

    His late Friday night message came after a two-hour conference meeting in the Capitol, where McCarthy floated several different options – including putting the Senate bill on the floor or passing a short-term bill that excludes Ukraine money. But there is still no consensus on what – if anything – they will put on the House floor Saturday to avoid a government shutdown.

    McCarthy suffered another high-profile defeat on Friday when the House failed to advance a last-ditch stopgap bill.

    In the aftermath of Friday’s failed vote, McCarthy told reporters he had proposed putting up a “clean” stopgap bill, and said he was “working through maybe to be able to do that.”

    “We’re continuing to work through – trying to find the way out of this,” McCarthy said.

    The Senate’s bipartisan bill would provide additional funds for Ukraine aid, creating a point of contention with the House where many Republicans are opposed to further support to the war-torn country.

    McCarthy argued on Friday that aid to Ukraine should be dropped from the Senate bill. “I think if we had a clean one without Ukraine on it, we could probably be able to move that through. I think if the Senate puts Ukraine on there and focuses on Ukraine over America, I think that could cause real problems,” he told CNN’s Manu Raju.

    The Senate, meanwhile, is working to advance its own bipartisan stopgap bill. The chamber is on track to take a procedural vote Saturday afternoon to move forward with the bill, particularly if the last-minute House bill falters. But it’s not yet clear when senators could take a final vote to pass the bill and it may not happen until Monday, after the government has already shut down.

    Border security has also become a complicating factor for the Senate bill as many Republicans now want to see the bill amended to address the issue.

    Senate Republicans said Friday that they were still discussing what kind of border amendment they would want to add to the bill, and were unsure if the chamber could even advance the bill in Saturday’s procedural vote without the addition of a border amendment.

    “Nothing’s really coming together, too many moving parts at this stage,” said Sen. Mike Braun, an Indiana Republican. “I think what I understand is we’re going to have a vote tomorrow … and other than that, there’s nothing that’s really crystallized in anything that probably would be palatable with the House.”

    This story and headline have been updated with additional developments.

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  • US mortgage rates climb to 7.31%, hitting their highest level in nearly 23 years | CNN Business

    US mortgage rates climb to 7.31%, hitting their highest level in nearly 23 years | CNN Business


    Washington, DC
    CNN
     — 

    US mortgage rates surged to their highest level in nearly 23 years this week as inflation pressures persisted.

    The 30-year fixed-rate mortgage averaged 7.31% in the week ending September 28, up from 7.19% the week before, according to data from Freddie Mac released Thursday. A year ago, the 30-year fixed-rate was 6.70%.

    “The 30-year fixed-rate mortgage has hit the highest level since the year 2000,” said Sam Khater, Freddie Mac’s chief economist, in a statement. “However, unlike the turn of the millennium, house prices today are rising alongside mortgage rates, primarily due to low inventory. These headwinds are causing both buyers and sellers to hold out for better circumstances.”

    The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country. The survey includes only borrowers who put 20% down and have excellent credit.

    Mortgage rates have spiked during the Federal Reserve’s historic inflation-curbing campaign — and while a good deal of progress has been made since June 2022, when inflation hit 9.1%, Fed officials say there is still a ways to go.

    The Fed’s preferred inflation measure, the core Personal Consumption Expenditures index, is currently 4.2%, which is more than double the Fed’s target of 2%. Economists expect it to drop to 3.9% when the latest reading is released on Friday.

    This week’s mortgage rate surge followed last week’s small move higher, as investors settled in for “higher-for-longer” interest rates after last week’s Fed policy meeting, said Danielle Hale, chief economist at Realtor.com.

    Hale said the takeaway from the meeting was that the upward adjustments from the Fed haven’t ended.

    “Revised economic projections show that another rate hike this year is definitely on the table, and the expected policy rate in 2024 and 2025 was also higher than previously forecast,” she said. “Market participants are still playing catchup.”

    While the Fed does not set the interest rates that borrowers pay on mortgages directly, its actions influence them.

    Mortgage rates tend to track the yield on 10-year US Treasuries, which move based on a combination of anticipation about the Fed’s actions, what the Fed actually does and investors’ reactions. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow.

    The yield on 10-year Treasuries rose from 4.3% on September 20 to 4.6% as of September 27.

    Mortgage applications continued to drop last week, according to the Mortgage Bankers Association, as mortgage rates went higher.

    “Rates over 7% and low for-sale inventory continue to create affordability challenges for prospective buyers,” said Bob Broeksmit, MBA president and CEO. “Until rates start to come back down, we anticipate housing market activity will remain slow.”

    Markets are experiencing an extraordinarily low number of homes for sale as homeowners stay put with ultra-low mortgage rates that are several percentage points lower than the current rate.

    There has been a small uptick in newly listed homes coming to market over the past few weeks, according to Realtor.com, which is seasonally atypical, said Hale.

    The first week in October tends to be an ideal week to buy a home, she said, since home prices tend to fall relative to summer highs, and fewer buyers contend for homes. Yet housing inventory remains higher than a typical week, Hale said.

    But, she added, mortgage rates will continue to be a wild card, which could make it impossible for some buyers to get in the market now.

    Even as demand is dropping, with so few homeowners selling, the market is pushing up prices as those few buyers who remain tussle over the handful of available houses, Hale said.

    This combination of higher prices and higher mortgage rates contrasts with easing rents over the past few months. This may cause would-be first-time buyers to wait for home prices and mortgage rates to stabilize and rent instead.

    “Buying a starter home is more expensive than renting in all but three major US markets [Realtor.com] studied,” said Hale, “which explains why buyer demand is likely to remain relatively low.”

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  • Convicted felon suspected of killing Baltimore tech CEO has been arrested, police say | CNN

    Convicted felon suspected of killing Baltimore tech CEO has been arrested, police say | CNN



    CNN
     — 

    A convicted felon suspected of killing tech executive Pava LaPere in Baltimore this week has been arrested, Baltimore police said early Thursday.

    Jason Dean Billingsley was wanted on first-degree murder and other charges in connection with the death of LaPere, the 26-year-old CEO of Baltimore-based startup EcoMap Technologies, according to police.

    Police did not immediately provide details about the arrest.

    LaPere was found dead in a downtown Baltimore apartment building on Monday with apparent blunt force trauma to her head, police said. The killing prompted a dayslong manhunt for Billingsley, who officials warned should be considered armed and dangerous.

    This is a developing story and will be updated.

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  • Travis Kelce talked Taylor Swift on his podcast | CNN

    Travis Kelce talked Taylor Swift on his podcast | CNN



    CNN
     — 

    Travis Kelce was already famous, but now he is learning what it means to be Taylor Swift-adjacent-famous.

    The new episode of his podcast, “New Heights,” which he hosts with his brother, fellow NFL football player Jason Kelce, dropped Wednesday.

    Jason Kelce introduced the TSwift of it all in the midst of some football talk by saying, “We’re here.”

    “We’ve been avoiding this subject out of respect for your personal life,” Jason Kelce, who plays for the Philadelphia Eagles said. “But now we gotta talk about it.”

    “My personal life that’s not so personal,” Travis Kelce quipped. “I did this to myself Jason. I know this.”

    Jason Kelce then brought up Swift’s recent attendance at his brother’s game to watch his Kansas City Chiefs take on the Chicago Bears in Arrowhead Stadium. The superstar singer sat in a suite alongside the matriarch of the Kelce family and it pretty much broke the internet.

    After Jason Kelce asked his brother what his life is now like, Travis Kelce said he’s on the “roller coaster of life.”

    “I noticed a few things,” Travis Kelce said. “Paparazzi at my house. S**t like that.”

    The paps are there with cameras and screaming his name he said. His brother naturally asked about his special guest at the game.

    “Shout out to Taylor for pulling up,” Travis Kelce said. “That was pretty ballsy.”

    He hailed Swift who “looked amazing” and he said his friends and family had nothing but amazing things to say about her. Not to mention that his Chiefs won the game.

    “We script it all ladies and gentleman,” he (maybe) joked. “It was impressive.”

    Kelce said he found all the attention and excitement “hysterical.”

    “It’s definitely a game I’ll remember,” he said. “That’s for damn sure.”

    The brothers covered some more ground, including the sales of Travis Kelce’s jersey exploding post the Swift appearance, how everyone including football coaches have been talking about the possible couple and even how they drove off in his convertible after the game.

    As to whether they are a couple or not we still don’t really know because Kelce chose to pass and left it as, “What’s real is that it is my personal life. I want to respect both of our lives.”

    Moving forward he will stick to talking about sports he said.

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  • PlayStation head Jim Ryan is stepping down | CNN Business

    PlayStation head Jim Ryan is stepping down | CNN Business


    New York
    CNN
     — 

    PlayStation boss Jim Ryan is stepping down from the company, Sony announced Wednesday.

    The Sony Interactive Entertainment President and CEO will be retiring in March 2024 after 30 years in the PlayStation business.

    Sony Group Corporation president, COO and CFO Hiroki Totoki will assume the role of SIE chairman next month to “support” the transition, and will take over as interim CEO once Ryan retires.

    Ryan joined SIE in 1994 and was appointed CEO in 2019. He had previously held senior positions at the company including president of SIE Europe, head of global sales and marketing at SIE and deputy president of SIE.

    Ryan led the launch of the PlayStation 5, which the company said is PlayStation’s most successful platform.

    “I’ve found it increasingly difficult to reconcile living in Europe and working in North America,” Ryan said in a statement. “I will leave having been privileged to work on products that have touched millions of lives across the world.”

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