Tag: Regulation/Government Policy

Why the U.S. debt-ceiling is worrying stock and bond investors

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The U.S. Treasury Department began taking “extraordinary measures” on Thursday to keep the federal government current on its bills, while giving Congress more time to come up with a debt ceiling deal.

Those special measures allow the Treasury to keep paying its bills, including paying holders of government debt what they are due, while also, for now, continuing the issuance of bills and notes as scheduled in the near $24 trillion Treasury market, the world’s biggest debt market, to replace maturing debt.

“There’s constant maturities and constant new issuance,” said Jim Vogel, an interest-rate strategist at FHN Financial, in an interview Thursday. “Until the Treasury calls a halt to auctions they go on as normal.”

In part, new note auctions on deck will replace maturing bonds issued years ago, which should help give confidence to investors that the U.S. government intends to fully repay principal and interest, as promised. It also helps bide time for Congress to strike a deal to increase or suspend the existing debt limit.

“Your early warning system is when 6-month bills get cheaper,” Vogel said, adding that a wobble in that part of the Treasury market could signal worries by investors that top lawmakers could fail to reach a debt ceiling deal by this summer, which could then raise the threat level of a U.S. government default.

What’s next in the U.S. debt limit standoff

The U.S. debt limit was first set in 1917, and already has been increased or suspended 102 times since World War II, according to David Kelly, chief global strategist at JP Morgan Funds, in a recent client note.

The government had been approaching its current debt limit of $31.385 trillion, prompting Treasury Secretary Janet Yellen on Thursday to deploy special measures to keep the government current on its bills, including making payments to bondholders, in moves she outlined a week ago.

Kelly said the Treasury has leeway to make adjustments to postpone “our real rendezvous with disaster” potentially until June, but that from an economic and financial perspective a U.S. default would be “an unmitigated disaster.”

Tax payments due to the U.S. government from corporations and households this spring also factor into the bigger debt-limit picture, while also influencing the final deadline for Congress to avoid an default on America’s debt.

“We are coming up to the March corporate tax day,” said Steven Ricchiuto, U.S. chief economist at Mizuho Securities, by phone Thursday. “That could boost the Treasury’s balances,” he said, while also noting the influx from taxes last was higher than anticipated.

Why investors are focusing on the debt ceiling now

With the ultimate showdown likely months away there are no discernible ripples in financial markets right now, but investors and analysts do seem to be paying much closer attention to the threat at a much earlier date than in past episodes, market watchers said.

Blame the intraparty battle between House Republicans that saw Kevin McCarthy elected speaker on Jan. 7 after a historic 15 ballots – and only after agreeing to a series of concessions to a small group of far-right conservatives.

Investors are “talking about it early because it came on the heels of a very difficult election of the speaker of the House and the sense that there’s now much more leverage that a few members of Congress may have to force this crisis that’s more likely to hit later in the summer,” said Christopher Smart, chief global strategist at Barings and head of the Barings Investment Institute, in a phone interview.

Some recent history underscores the concern. It took all of then-Speaker John Boehner’s political capital – “and then some” – to finally secure a vote among the Republican caucus on raising the debt limit during a similar showdown in 2011, Smart noted, observing that Boehner had “much more leeway” than McCarthy.

“So if there are five or more members who won’t vote” on raising the limit “without certain conditions being met,” it’s easy to imagine potentially ugly scenarios that could rattle markets, he said.

What’s at stake

Former Federal Reserve Bank of New York President Bill Dudley said Thursday in an interview with Bloomberg that a U.S. default would be a “huge blow” to markets, but also that a contingency plan exits if it happens.

“The way it works is if you actually run out of money, the Treasury will decide what payments to present to the Fed,” Dudley said. “Presumably, the Treasury will decide to prioritize debt repayment and interest payments, so there isn’t a technical default. The Fed will basically honor the payments the Treasury present.”

The Fed also could step in to shore up market functioning in the Treasury market, if needed.

“What we saw in 2011 is that the Treasury market got stronger until we got close to the deadline,” Dudley said. “People don’t want to buy Treasury bills that are maturing right around the time the debt limit could be binding.”

As a result of a 2011 debt-ceiling standoff, credit rating firm Standard & Poor’s downgraded the U.S. credit ratings to AA from AAA.

U.S. stocks declined for a third straight day on Thursday, with the Dow Jones Industrial Average
DJIA,
-0.76%
losing 252.40 points, or 0.8%, while the S&P 500
SPX,
-0.76%
shed 0.8% and the Nasdaq Composite Index
COMP,
-0.96%
dropped 1%.

—Greg Robb contributed reporting to this article.

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January 19, 2023
WHO calls on China to release more information on its COVID case surge to learn more about which variants are circulating

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The World Health Organization has called on China to release more information about its current wave of COVID infections after China said nearly 60,000 people have succumbed to the virus since early December, the Associated Press reported.

The announcement of fatality numbers on Saturday came after weeks of complaints that China was not keeping experts abreast of what was happening.

The announcement “allows for a better understanding of the epidemiological situation,” said a WHO statement. Director-general, Tedros Adhanom Ghebreyesus talked by phone with Health Minister Ma Xiaowei, it said.

“WHO requested that this type of detailed information continued to be shared with us and the public,” the agency said.

The National Health Commission said only deaths in hospitals were counted, which means anyone who died at home is not part of the tally. It gave no indication of when or whether it might release updated numbers. China has seen a wave of cases ever since the government ended stringent restrictions on movement in December.

The WHO is now analyzing the data, which covers early December to Jan. 12. So far, the epidemiology is similar to what has been seen in other countries, “a rapid and intense wave of disease caused by known sub-variants of omicron with higher clinical impact on older people and those with underlying conditions,” said the statement.

The agency is hoping to get more information on the exact variants that are circulating. China has reported that two omicron sublineages, dubbed BA.5.2 and BF.7 are spreading but the WHO needs more sequences to be shared with open databases to get fully up to date.

See also: China reports first population drop in decades as birthrates plunge

Tens of thousands of people resumed travels in and out of China on Sunday as the country lifted almost all of its border restrictions, ending three years of strict pandemic controls. Some travelers expressed relief to be reunited with their families. Photo: Tyrone Siu/Reuters

In the U.S., the seven-day average of new U.S. COVID cases stood at 59,121 on Monday, according to a New York Times tracker. That’s flat from two weeks ago and below the recent peak of 70,508 on Christmas Eve.

See also: Americans are facing years of ‘tripledemic’ winters that may put patients with other ailments at risk, Jha says

The daily average for hospitalizations was down 8% at 45,052. The average for deaths stood at 562, up 78% from two weeks ago to continue the recent trend.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• The U.S. Centers for Disease Control and Prevention said its real-time surveillance system has met the statistical criteria to prompt additional investigation into whether there is a risk of ischemic stroke in people ages 65 and older who received the Pfizer/BioNTech
PFE,
-3.70%

BNTX,
-1.28%
bivalent COVID vaccine. “Rapid-response investigation of the signal in the VSD (vaccine safety datalink) raised a question of whether people 65 and older who have received the Pfizer-BioNTech COVID-19 Vaccine, Bivalent were more likely to have an ischemic stroke in the 21 days following vaccination compared with days 22-42 following vaccination,” the agency said in a statement. No such signal has been identified with the Moderna
MRNA,
-0.68%
bivalent vaccine, it added.

• Italian tennis player Camila Giorgi has denied allegations that she obtained a false COVID-19 vaccine certificate to allow her to travel, the AP reported. A doctor is under investigation in Italy for supplying false certificates and fake vaccines and Giorgi’s name was revealed in a long list of people implicated by an Italian newspaper. Giorgi is currently competing in the Australian Open.

Getting the flu can increase the risk of getting a second infection, including strep throat. WSJ’S Daniela Hernandez explains the science behind that, plus what it means for the rest of the winter and how we can protect ourselves from the tripledemic. Illustration: David Fang

• The New York State Department of Health is “exploring its options” after a state Supreme Court judge struck down a statewide mandate requiring healthcare workers to be vaccinated against COVID-19, the AP reported separately. Judge Gerard Neri wrote in a ruling released Friday that Democratic Gov. Kathy Hochul and the health department overstepped their authority by mandating a vaccine that’s not included in state public health law, the Syracuse Post-Standard reported. The mandate is “null, void, and of no effect,” the judge said. He sided with Medical Professionals for Informed Consent, a group of medical workers impacted by the vaccination mandate.

Here’s what the numbers say:

The global tally of confirmed cases of COVID-19 topped 667.3 million on Tuesday, while the death toll rose above 6.7 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 101.7 million cases and 1,099,885 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 229.4 million people living in the U.S., equal to 69.1% of the total population, are fully vaccinated, meaning they have had their primary shots.

So far, just 49.6 million Americans, equal to 15.9% of the overall population, have had the updated COVID booster that targets both the original virus and the omicron variants.

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January 17, 2023
Too Much Government Debt Could Become a Big Problem for the Stock Market

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It’s always fun until the bill comes due—and the bill always comes due. In fact, it’s coming due right about now.

On Friday, Treasury Secretary Janet Yellen warned Congress that the U.S. would hit its debt ceiling this coming Thursday, earlier than many had expected. That doesn’t mean the government will be forced to stop paying its bills then—Yellen believes that the Treasury has enough cash and other ways to raise money to last it until early June—but it does mean that an issue that was still purely theoretical has become far more pressing as the X date approaches.

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January 13, 2023
New COVID subvariant is now dominant across the U.S., accounting for 43% of all new cases in latest week, CDC says

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The XBB.1.5 omicron subvariant that has been dominant in the Northeast for several weeks is now officially dominant across the U.S., according to an update from the Centers for Disease Control and Prevention early Friday.

XBB.1.5 accounted for 43% of all COVID cases in the week through Jan. 14, pulling ahead of BQ.1.1, which accounted for 28.8% of new cases, and BQ.1, which accounted for 15.9%, the data showed.

Last week, BQ.1.1 was still dominant nationwide, accounting for 33.5% of new cases versus XBB.1.5’s 30.4%.

In the New York region, which includes New Jersey, the U.S. Virgin Islands and Puerto Rico, XBB.1.5 now accounts for 82.7% of new cases, up from 72.7% a week ago.

On Thursday, the World Health Organization acknowledged that XBB.1.5, which was first detected in tiny numbers in the U.S. in October, has become the most transmissible variant yet thanks to a growth advantage, and said that it appears to have a greater ability to evade immunity than earlier variants.

However, the immune-escape data is based on preliminary lab-based studies and not on research in humans. And with the only data to review coming from the U.S., the agency said there’s no information yet on clinical severity.

XBB.1.5 is similar to its immediate predecessor XBB.1 but has an additional mutation to its spike protein that may be behind its growth advantage. For now, it does not appear to have any mutation that might lead to more severe disease or death, WHO officials have said. The agency is monitoring it along with five other omicron variants.

On Friday, the WHO updated guidelines on face masks, treatments and patient care in the age of COVID, a reminder that the pandemic is not yet over, even if people are mostly behaving as if it is. Given current global trends, the agency is recommending that people wear face masks when in public settings that are enclosed or poorly ventilated. People who have been exposed to the virus should also wear masks.

“Similar to previous recommendations, WHO advises that there are other instances when a mask may be suggested, based on a risk assessment,” the agency said in a statement. “Factors to consider include the local epidemiological trends or rising hospitalization levels, levels of vaccination coverage and immunity in the community, and the setting people find themselves in.”

The WHO reduced its recommended isolation period for COVID patients and said they can end isolation early if they test negative on a rapid test. Patients with symptoms should isolate for 10 days from the start of symptom onset, but the agency has dropped its advice for an additional three days.

For asymptomatic patients who test positive, the WHO now recommends five days of isolation, compared with 10 days previously.

The WHO extended a strong recommendation for the use of Pfizer’s
PFE,
+0.29%
antiviral Paxlovid for patients with mild to moderate symptoms who are at risk of hospitalization.

The data comes as the seven-day average of new U.S. cases stood at 60,610 on Thursday, according to a New York Times tracker. That’s up 4% from two weeks ago and below the recent peak of 70,508 on Christmas Eve. The daily average for hospitalizations was up 10% to 45,842. The average for deaths was 564, up 61% from two weeks ago.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• The peak of China’s COVID-19 wave is expected to last two to three months and to soon extend over the country’s vast rural areas, where medical resources are relatively scarce, Reuters reported Friday, citing a Chinese epidemiologist. Infections are expected to surge in those areas as hundreds of millions of people travel to their hometowns for the Lunar New Year holiday, which starts Jan. 21. “Our priority focus has been on the large cities. It is time to focus on rural areas,” said Zeng Guang, the former chief epidemiologist at the Chinese Centers for Disease Control and Prevention, according to a report published in local media outlet Caixin on Thursday.

• Private services offering Chinese travelers access to mRNA vaccines are attracting droves of mainlanders to Hong Kong and Macau, the Guardian reported on Friday, as people seek a booster shot that their government has refused to approve. The government only allowed its citizens to get homegrown vaccines developed by Sinopac and Sinopharm
8156,
+6.45%
throughout the pandemic, but many people are now seeking the greater protection offered by the mRNA vaccines developed by Moderna
MRNA,
+2.10%
and by Pfizer and German partner BioNTech
BNTX,
-2.92%.

Tens of thousands of people have resumed travels in and out of China after the country lifted almost all of its border restrictions, ending three years of strict pandemic controls. Photo: Tyrone Siu/Reuters

• Kansas Gov. Laura Kelly plans to return to work at the Statehouse Friday after learning that a COVID-19 test earlier in the week gave her a false positive result, her office said, the Associated Press reported. Kelly has been working in self-isolation at the governor’s residence since the false positive Tuesday. Her office announced that she had tested positive for COVID-19, and she postponed the annual State of the State address from Wednesday to Jan. 24.

See also: Sick house: Florida man gets 8 ½ years for using COVID relief to buy lavish 12-acre estate, fleet of luxury cars

Here’s what the numbers say:

The global tally of confirmed cases of COVID-19 topped 666.3 million on Friday, while the death toll rose above 6.7 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 101.6 million cases and 1,099,629 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 229.4 million people living in the U.S., equal to 69.1% of the total population, are fully vaccinated, meaning they have had their primary shots.

So far, just 49.6 million Americans, equal to 15.9% of the overall population, have had the updated COVID booster that targets both the original virus and the omicron variants.

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January 13, 2023
The days of IRS forgiveness for RMD mistakes may soon be over

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Katie St. Ores has a 100% track record of getting her tax clients out of paying the steep penalty for missing a required minimum distribution from their retirement funds. That amounts to only two households getting forgiveness, but it represents a lot of dollars, because the fee for any sort of mistake with RMDs is 50% of what’s missing, which could be tens of thousands of dollars.

Now’s the time to make things right if you forgot to make your RMD payment by Dec. 31 for 2022, paid the wrong amount or realized you got it wrong in a past year. The faster you correct it, the more likely the IRS is likely to waive the fines — and your chances are good overall, despite the agency’s stern reputation.

Beware, though, that new rules are going into effect in 2023 that could make the IRS less accommodating. For one thing, the age to start RMDs is going to 73 this year, and then 75 in 2033, which means the government is going to be hungry for the missing revenue. Even more important, the penalty will be reduced to 25% — or 10% if you’re really quick about reporting it.

The IRS doesn’t publicly track how many people miss or make mistakes with their RMDs, but financial advisers and tax professionals say it happens often enough, and they consider the IRS to be quite liberal about granting waivers.

St. Ores, who is a financial adviser and tax preparer based in McMinnville, Ore., thinks the IRS has responded generously so far because they know the rules are complex and mistakes happen.

“They know people are getting up there in age, and so they’ve probably said up to now, let’s just grant it,” says St. Ores.

But the new penalties seem worded to avoid waivers in the future, especially because of the extra reduction to 10% if you act to quickly correct mistakes. Up to now, the IRS has taken pains to point out how to ask for a forgiveness on its website, but now there will be new emphasis on the lower penalties.

“The 50% penalty effectively ‘scared’ taxpayers to withdraw RMDs, so reducing the penalty could reduce the fear of additional tax, leading to more taxpayers missing their RMDs,” says St. Ores. “Between more taxpayers that potentially neglect to take their RMDs because of a not-as-high penalty and confusion over the current required age, the IRS will probably collect more taxes overall.”

What to do about past mistakes

There are a lot of different ways to mess up your required minimum distributions. The amount you’re supposed to pay is calculated according to a formula that takes your account balance of all your qualified tax-deferred accounts and multiplies it by a factor related to your age.

When you get started taking the money out, it works out generally to about 4% of the account value. You keep taking RMDs every year from your designated start time until the accounts are empty (or you die). The beginning age in the past was 70½, then it moved to 72, and now it’s changing to 73.

“These things can get complicated,” says Isaac Bradley, director of financial planning at Homrich Berg, an investment firm based in Atlanta. He advised one couple that accidentally took the distribution from the wrong spouse.

Another easy mistake is taking the wrong amount because of a math error. Sometimes, the problem is just about communication, because people tend to have multiple 401(k)s at old employers or several rollover IRAs that aren’t consolidated. The adviser helping make the calculations might not know of an account held at a different custodian, and that could throw off the whole equation.

David Haas, a financial adviser and president of Cereus Financial Advisors, based in Franklin Lakes, N.J., has had to help family members correct RMDs, mostly having to do with inherited IRA accounts.

“You’re supposed to take RMD for the person who died, if they didn’t already take it,” he says, but a lot of people miss those in the confusion of grief.

Then once you inherit the account, you have to take RMDs over a 10 year period to empty the account.

“With one relative, she just kept on missing it and that was her fault. She didn’t realize what she was supposed to do. People don’t know the law, and it’s very confusing,” Haas says.

The first step is realizing you made a mistake, and then once you know that, pay the amount that’s missing. You need to file a special form with the IRS for the tax year in question (Form 5329), which you can send in at any point — you don’t have to wait until you file your next tax return.

If you want to ask for a waiver, you need to attach a letter explaining the mistake. If your request is not granted, then you pay the penalty.

While the process isn’t excessively complicated, you might want to consult with a tax professional to make sure you’re not making more mistakes in calculating the amount that’s missing. It could turn out to be a lot of paperwork if you have missed multiple years.

Kenneth Waltzer, a financial planner based in Los Angeles, had a client who did not realize he had inherited an IRA and missed the RMDs on it for five years. “He ignored emails about it,” says Waltzer. “When he came to us, it added up to over $100,000.”

For Katie St. Ores, the message going forward is going to be: Get it right the first time. Forgiveness may not be so easy to come by in the future. “I’m trying to stay on top of my clients taking their RMDs on time,” she says.

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January 13, 2023
Genesis, Winklevoss twins’ Gemini crypto venture charged by SEC with selling unregistered securities

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U.S. securities regulators on Thursday charged Genesis Global Capital and crypto exchange Gemini Trust Co. with offering and selling of unregistered securities to retail investors, bypassing disclosures and other requirements aimed at protecting market participants.

Genesis and Gemini raised billions of dollars’ worth of crypto assets from hundreds of thousands of investors through unregistered offers, using a crypto asset-lending program called Gemini Earn, the Securities and Exchange Commission said.

The complaint seeks the return of any “ill-gotten gains” plus interest, and any civil penalties, the SEC said.

The SEC is also investigating whether other securities-law violations were committed and whether there are other companies or people relating to the alleged misconduct.

Twins Tyler and Cameron Winklevoss are the founders of Gemini. The crypto exchange was sued late last year by investors alleging that the company sold interest-bearing accounts without registering them as securities, also through the Gemini Earn program.

Also read: Gemini’s Cameron Winklevoss accuses crypto exec Barry Silbert of ‘bad faith’ stalling over frozen funds

The Winklevoss twins were early champions of cryptocurrencies, using the money and fame they won in legal wrangling with Facebook parent Meta Platforms Inc.
META,
+2.87%
and Meta’s founder Mark Zuckerberg over their role in creating the social-media giant to launch Gemini.

According to the SEC complaint, the Gemini Earn agreement between Genesis, part of a subsidiary of Digital Currency Group, and Gemini started in December 2020.

Gemini customers, including U.S. retail investors, were to have an opportunity to loan their crypto assets to Genesis in exchange for Genesis’ promise to pay a high interest rate.

Gemini deducted agent fees that were as high as 4.29%, the SEC alleges.

“Genesis then exercised its discretion in how to use investors’ crypto assets to generate revenue and pay interest to Gemini Earn investors,” the SEC said.

By November, however, Genesis announced it would not allow the Gemini Earn investors to withdraw their crypto assets because of a liquidity crunch following volatility in the crypto market after FTX’s bankruptcy filing, the SEC said.

At the time, Genesis held about $900 million in investor assets from 340,000 Gemini Earn investors, the SEC said. Gemini ended the Gemini Earn program earlier this month.

“As of today, the Gemini Earn retail investors have still not been able to withdraw their crypto assets,” the SEC said in a statement.

“We allege that Genesis and Gemini offered unregistered securities to the public, bypassing disclosure requirements designed to protect investors,” SEC Chair Gary Gensler said in a statement.

The charges “build on previous actions to make clear to the marketplace and the investing public that crypto-lending platforms and other intermediaries need to comply with our time-tested securities laws,” Gensler said.

The SEC’s complaint was filed in the U.S. District Court for the Southern District of New York.

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January 12, 2023
COVID subvariant dominant in northeastern U.S. has a growth advantage and may have greater ability to evade immunity than earlier strains, WHO says

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The XBB.1.5 omicron subvariant has a growth advantage over other circulating subvariants of the virus that causes COVID-19, and early data suggest it also has a greater ability to evade immunity than previous ones, according to the World Health Organization.

In its weekly epidemiological update, the agency said the immune-escape data is based on preliminary lab-based studies and not on research in humans.

“At present, there is no available information on clinical severity for XBB.1.5,” the WHO said. Data from the U.S. Centers for Disease Control and Prevention are showing that XBB.1.5 has become dominant in the northeastern U.S.

Six omicron variants are currently being monitored, and they accounted for 76.2% of sequences submitted to a central database in the week through Dec. 25, the update said. The BQ.1 subvariant accounted for 53.4% of those.

The global case tally fell 9%, to 2.9 million new cases, in the week through Jan. 8, although with testing and delays in reporting from some countries result due to the end-of-year holidays, those numbers should be treated with caution, said the WHO.

The number of fatalities reported was down 125, to over 11,000.

In the U.S., the seven-day average of new cases stood at 63,088 on Wednesday, according to a New York Times tracker. That’s down 2% from two weeks ago and below the recent peak of 70,508 on Christmas Eve.

The daily average for hospitalizations was up 12% to 46,278. The average for deaths, meanwhile, was 555, which is up 61% from two weeks ago.

Cases are now rising in 28 states, led by Florida, where they are up 90% from two weeks ago. On a per capita basis, New Jersey has the highest rate, at 32 new cases per 100,000 residents, followed by North Carolina, Rhode Island and South Carolina.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• Travelers whose package tours were affected by the imposition of COVID-19 restrictions may be entitled to at least a partial refund, the European Union’s highest court said Thursday, the Associated Press reported. The European Court of Justice weighed in after being asked for its opinion by a court in Germany. The Munich court is considering the case of two people who bought a two-week package vacation on the Spanish island of Gran Canaria that started on March 13, 2020, just as the pandemic hit Europe. They are seeking a 70% refund because of restrictions that were imposed there two days later and their early return home.

• People in China worried on Thursday about spreading COVID to elderly relatives as they planned visits to their hometowns for a holiday travel season that the WHO warns could inflame a raging outbreak, Reuters reported. The Lunar New Year holiday, which starts on Jan. 21, comes a month after China abandoned a strict zero-COVID regime of mass lockdowns that prompted widespread frustration and boiled over into historic protests. The outbreak, which is spreading from China’s megacities to rural areas that have weaker medical resources, is overwhelming some hospitals and crematoriums. The WHO on Wednesday said it would be challenging to manage the virus over a holiday period that is considered the world’s largest annual migration of people.

Tens of thousands of people have resumed travels in and out of China after the country lifted almost all of its border restrictions, ending three years of strict pandemic controls. Photo: Tyrone Siu/Reuters

• A 14th Mississippi child has died from COVID, the state’s department of health said Wednesday, the AP reported. The infant under the age of one was the first person under age 18 to die from COVID-19 in the state in 2023. According to state department of health data, eight children between the ages of 11 and 17 have died since the first cases of the virus were identified in 2020, making that age range the most prone to pediatric deaths in the state so far.

Here’s what the numbers say:

The global tally of confirmed cases of COVID-19 topped 665.8 million on Thursday, while the death toll rose above 6.7 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 101.5 million cases and 1,098,512 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 229.3 million people living in the U.S., equal to 69.1% of the total population, are fully vaccinated, meaning they have had their primary shots.

So far, just 48.2 million Americans, equal to 15.4% of the overall population, have had the updated COVID booster that targets both the original virus and the omicron variants.

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January 12, 2023
China stops issuing visas to Japanese and South Korean visitors as spat over test mandates for Chinese tourists widens

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China stopped issuing visas for visitors from Japan and South Korea on Tuesday in apparent retaliation for COVID-testing measures imposed on travelers from China, the Associated Press reported.

China had warned it would take action against countries that mandate testing for its citizens, who are now free to travel after the government lifted strict restrictions on movement last month, unleashing a wave of new cases.

At least 10 countries in Europe, North America and Asia have imposed test requirements recently, with officials expressing concern about a lack of information about the Chinese outbreak and the potential for new virus variants to emerge.

Japan and South Korea protested the visa stoppage, the AP reported separately on Wednesday.

South Korean Foreign Minister Park Jin said he finds it “significantly regrettable” that China stopped issuing short-term visas to South Koreans and called for China to align its pandemic steps with “scientific and objective facts.”

Japanese Chief Cabinet Secretary Hirokazu Matsuno criticized China for “one-sidedly” restricting visa issuances to Japanese nationals “because of a reason that is not related to COVID-19 measures.”

Tens of thousands of people have resumed travel in and out of China after the country lifted almost all of its border restrictions, ending three years of strict pandemic controls. Photo: Tyrone Siu/Reuters

In the U.S., the seven-day average of new cases stood at 63,982 on Tuesday, according to a New York Times tracker. That’s down 4% from two weeks ago and below the recent peak of 70,508 on Christmas Eve.

The daily average for hospitalizations was up 15% to 46,900. In an alarming statistic, the average for deaths stood at 580, up 50% from two weeks ago.

Cases are currently rising in 22 states, as well as Guam, the U.S. Virgin Islands and Northern Mariana Islands. In Maryland, cases are up 170% from two weeks ago.

On a per capita basis, New Jersey and Rhode Island are showing the highest rates, with New Jersey recording 32 cases per 100,000 residents and Rhode Island 31.

Cases are also high on a per capita basis in North Carolina and South Carolina, as well as Mississippi and Florida.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• Cyprus has joined the list of countries mandating COVID testing for tourists from China, the AP reported. The health ministry said it was heeding the advice of the European Union’s executive arm in requiring passengers from China to submit results from a PCR test taken 48 hours before their departure. The ministry also recommended the use of protective face masks on all flights to and from Cyprus as well as in any areas where people gather in large numbers.

• The Chinese air-travel regulator is preparing to allow airlines to fly more routes between China and the U.S. following the lifting of COVID travel restrictions, state TV reported Wednesday, as the AP reported. U.S. and Chinese airlines are among some 40 carriers that have submitted applications covering some 700 flights per week involving 34 countries, China Central Television reported on its website. It gave no timeline for when normal flights might resume.

See also: Chinese COVID cases expected to peak at 3.7 million a day by Jan. 13, with daily deaths reaching 25,000: health-data company forecast

• The Pentagon formally dropped its COVID-19 vaccination mandate Tuesday, but a new memo signed by Defense Secretary Lloyd Austin also gives commanders some discretion in how or whether to deploy troops who are not vaccinated, the AP reported. Austin’s memo has been widely anticipated since Dec. 23, when a new law gave him 30 days to rescind the mandate. The Defense Department had already stopped all related personnel actions, such as discharging service members who refused the shot. “The Department will continue to promote and encourage COVID-19 vaccination for all service members,” Austin said in the memo. “Vaccination enhances operational readiness and protects the force.”

Getting the flu can increase the risk of getting a second infection, such as strep throat. The Wall Street Journal’s Daniela Hernandez explains the science behind that, plus what it means for the rest of the winter and how we can protect ourselves from the tripledemic. Illustration: David Fang

Here’s what the numbers say:

The global tally of confirmed cases of COVID-19 topped 665.3 million on Wednesday, while the death toll rose above 6.7 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 101.3 million cases and 1,097,660 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 229.3 million people living in the U.S., equal to 69.1% of the total population, are fully vaccinated, meaning they have had their primary shots.

So far, just 48.2 million Americans, equal to 15.4% of the overall population, have had the updated COVID booster that targets both the original virus and the omicron variants.

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January 11, 2023
Pentagon drops COVID-19 vaccine mandate for troops

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WASHINGTON — The Pentagon formally dropped its COVID-19 vaccination mandate Tuesday, but a new memo signed by Defense Secretary Lloyd Austin also gives commanders some discretion in how or whether to deploy troops who are not vaccinated.

Austin’s memo has been widely anticipated ever since legislation signed into law on Dec. 23 gave him 30 days to rescind the mandate. The Defense Department had already stopped all related personnel actions, such as discharging troops who refused the shot.

“The Department will continue to promote and encourage COVID-19 vaccination for all service members,” Austin said in the memo. “Vaccination enhances operational readiness and protects the force.”

Austin said that commanders have the authority to maintain unit readiness and a healthy force. He added, however, that other department policies — including mandates for other vaccines — remain in place. That includes, he said, “the ability of commanders to consider, as appropriate, the individual immunization status of personnel in making deployment, assignment, and other operational decisions, including when vaccination is required for travel to, or entry into, a foreign nation.”

The contentious political issue, which has divided America, forced more than 8,400 troops out of the military for refusing to obey a lawful order when they declined to get the vaccine. Thousands of others sought religious and medical exemptions. Austin’s memo ends those exemption requests.

Austin, who instituted the mandate in August 2021 after the Pfizer vaccine was approved by the Food and Drug Administration and as the coronavirus pandemic raged, was staunch in his desire to maintain it insisting the vaccine was necessary to protect the health of the force. He and other defense leaders argued that for decades troops, particularly those deployed overseas, had been required to get as many as 17 different vaccines. No other vaccine mandates were affected by the new law.

But Congress agreed to rescind the mandate, with opponents reluctantly saying that perhaps it had already succeeded in getting the bulk of the force vaccinated. Roughly 99% of active-duty troops in the Navy, Air Force and Marine Corps had gotten the vaccine, and 98% of the Army. The Guard and Reserve rates are lower, but generally are more than 90%.

Austin’s memo was unapologetic in his continued support for the vaccine, and his belief that the mandate kept the force healthy and able to protect America. The Pentagon’s vaccine efforts, he said, “will leave a lasting legacy in the many lives we saved, the world-class force we have been able to field, and the high level of readiness we have maintained, amidst difficult public health conditions.”

In addition to ending efforts to discharge troops who refuse the vaccine, Austin’s memo says that those who sought exemptions and were denied will have their records updated and any letters of reprimand will be removed.

Those who were discharged for refusing to obey a lawful order to take the vaccine received either an honorable discharge or a general discharge under honorable conditions. Austin’s memo says that anyone who was discharged can petition their military service to request a change in the “characterization of their discharge” in their personnel records. It does not, however, say what possible corrections could be awarded.

Austin’s decision leaves some discretion to commanders, allowing them to decide whether they can require vaccines in some circumstances, such as certain deployments overseas.

Military officials vividly recall the overwhelming crisis of the USS Theodore Roosevelt, the Navy aircraft carrier that was knocked out of duty and sidelined in Guam for 10 weeks in early 2020 as the emerging virus swept through the ship. More than 1,000 crew members eventually became infected, and one sailor died.

Military leaders worry that if troops begin to refuse the vaccine in large numbers, similar outbreaks could occur. The risk is particularly high on small ships or submarines where service members are jammed into close quarters for weeks or months at a time, or on critical combat missions, such as those involving special operations forces that deploy in small teams.

According to data compiled by the military as of early December, the Marine Corps leads the services with 3,717 Marines discharged. There have been 2,041 discharged from the Navy, 1,841 from the Army and 834 from the Air Force. The Air Force data includes the Space Force.

What’s not clear is if the services, who are facing recruiting challenges, will want — or be able to — allow any of those service members to return to duty, if they still meet all necessary fitness and other requirements.

Lawmakers argued that ending the mandate would help with recruiting. Defense officials have pushed back by saying that while it may help a bit, a department survey during the first nine months of last year found that a large majority said the mandate did not change the likelihood they would consider enlisting.

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January 11, 2023
China takes first steps to punish countries that imposed testing mandates for Chinese travelers

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China on Tuesday suspended visas for South Koreans to enter the country for tourism or business in apparent retaliation for South Korea’s COVID-19 testing requirements for Chinese travelers, the Associated Press reported.

No other details were given, although China has threatened to retaliate against countries that require travelers from China to show a negative result for a test taken within the previous 48 hours.

That has not stopped about a dozen countries from following the U.S. in requiring Chinese travelers produce a test after China lifted most of its strict COVID-related restrictions for the first time since the start of the pandemic. The end of those restrictions has resulted in a surge of new cases.

The World Health Organization and several nations have accused China of withholding data on its outbreak. The testing requirements are aimed at identifying potential virus variants carried by travelers.

Separately on Tuesday, the head of the WHO for Europe said the surge of cases in China is not likely to have a big impact on Europe, although he cautioned against complacency.

Hans Kluge told reporters it was “not unreasonable for countries to take precautionary measures to protect their populations” but called for such measures “to be rooted in science, to be proportionate and nondiscriminatory,” as AFP reported.

Tens of thousands of people resumed travels in and out of China after the country lifted almost all of its border restrictions, ending three years of strict pandemic controls. Photo: Tyrone Siu/Reuters

In the U.S., the seven-day average of new cases stood at 67,012 on Monday, according to a New York Times tracker. That’s up 2% from two weeks ago and below the recent peak of 70,508 on Christmas Eve.

The daily average for hospitalizations was up 18% to 47,503. The average for deaths was 467, up 10% from two weeks ago.

Cases are currently rising in 21 states, along with Guam, Washington, D.C., and the U.S. Virgin Islands. They are led by Florida, where cases are up 90% from two weeks ago. On a per-capita basis, New York, New Jersey and Rhode Island are seeing the highest rates. New York has 37 cases per 100,000 people, New Jersey 35 and Rhode Island 31.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• Thailand sent three cabinet ministers to welcome Chinese tourists with flowers and gifts as they arrived Monday at Bangkok’s Suvarnabhumi Airport after China relaxed travel restrictions, the AP reported. The high-profile event reflected the importance Thailand places on wooing Chinese travelers to help restore its pandemic-battered tourism industry. Before COVID, Chinese visitors accounted for about one-third of all arrivals.

• Moderna Inc.
MRNA,
+3.10%
is considering pricing its COVID vaccine at $110 to $130 per dose, the Wall Street Journal reported. That’s the same price range as mooted by Pfizer Inc.
PFE,
-1.59%
and German partner BioNTech SE
BNTX,
+3.30%
once their vaccine moves to the commercial market. For now, vaccines are being purchased and distributed by the U.S. government.

Getting the flu can increase the risk of getting a second infection, such as strep throat. The Wall Street Journal’s Daniela Hernandez explains the science behind that, plus what it means for the rest of the winter and how we can protect ourselves from the tripledemic. Illustration: David Fang

• India has detected the presence of all the COVID omicron subvariants in the community after testing more than 300 samples since late December, the health ministry said in a statement, Reuters reported. “No mortality or rise in transmission were reported in the areas where these variants were detected,” the ministry said.

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January 10, 2023
SEC charges ex–McDonald’s CEO Easterbrook for making false statements relating to his 2019 ouster

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The Securities and Exchange Commission said Monday it has filed charges against Stephen J. Easterbrook, former chief executive of McDonald’s Corp., for making “false and misleading” statements to investors about the circumstances that led to his ouster in November 2019.

The agency has also filed charges against McDonald’s for “shortcomings” in its public disclosures relating to Easterbrook’s severance agreement.

McDonald’s
MCD,
-0.55%
fired Easterbrook for exercising poor judgment and violating company policy by engaging in an inappropriate personal relationship with a McDonald’s employee. However, the separation agreement struck with the executive concluded that his termination was without cause, allowing him to retain substantial equity compensation that would have been forfeited in other circumstances.

“In making this conclusion, McDonald’s exercised discretion that was not disclosed to investors,” the SEC said in a statement.

In July 2020, McDonald’s discovered in an internal probe that Easterbrook had engaged in other, undisclosed relationships with employees. Those findings were not disclosed prior to Easterbrook’s termination, in the knowledge that they would influence the board’s decision making, according to the SEC.

“When corporate officers corrupt internal processes to manage their personal reputations or line their own pockets, they breach their fundamental duties to shareholders, who are entitled to transparency and fair dealing from executives,” said Gurbir S. Grewal, the SEC’s director of the division of enforcement.

The SEC is charging Easterbrook with violating anti-fraud provisions of the SEC Securities Act of 1933 and the Securities Exchange Act of 1934. Easterbrook has consented to a cease-and-desist order and five-year officer and director bar and a $400,000 civil penalty, without admitting to or denying the charges.

McDonald’s is charged with violating section 14(a) of the Exchange Act and Exchange Act Rule 14a-3. The fast-food giant has consented to a cease-and-desist order, without admitting to or denying SEC findings. The SEC has opted not to fine the company, as it cooperated with the agency and clawed back compensation after its probe.

The stock was slightly lower Monday in early trades.

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January 9, 2023
Ocugen stock up 16% premarket after company announced positive results for its COVID vaccine

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Ocugen Inc. stock
OCGN,
-3.85%
rallied 16% in premarket trade Monday, after the biopharma company announced positive results in a trial of its COVID vaccine Covaxin. The Phase 2/3 trial involved 491 U.S. adult participants who receive two doses of Covaxin or placebo 28 days apart. Covaxin is a whole-virion inactivated COVID-19 investigational vaccine candidate that uses the same vero cell manufacturing platform that has been used in the production of polio vaccines for decades. “Covaxin, an inactivated virus vaccine adjuvanted with TLR7/8 agonist, has been demonstrated in clinical trials to generate a broader immune response against the whole virus covering important antigens such as S-protein, RBD, and N-protein; whereas currently approved vaccines in the U.S. target only S-protein antigen,” the company said in a statement. Chief Executive Dr. Shankar Musnuri said the company is hoping the vaccine will offer an option for those who are still hesitant to take an mRNA vaccine, which uses newer technology. Ocugen stock has fallen 68% in the last 12 months, while the S&P 500
SPX,
-0.08%
has fallen 17%.

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January 9, 2023
Kevin McCarthy elected House speaker, narrowly prevailing in 15th round of voting

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Top House Republican Kevin McCarthy succeeded early Saturday in his push to become his chamber’s next speaker, claiming the job after first falling short in well over a dozen rounds of voting.

McCarthy could handle only a few GOP defections given his party’s narrow majority in the House of Representatives, but in ballots this week he repeatedly saw around 20 Republicans vote against him before finally prevailing.

On Friday, McCarthy began to pick up some support from those Republican holdouts in a 12th round of voting, though it wasn’t sufficient to give him the job, so 13th and 14th ballots were held, followed by the 15th and final ballot.

See: House moves to 15th speaker ballot after McCarthy falls one vote short in 14th

Ahead of Friday’s voting, there were signs of a deal that could help McCarthy take the gavel. One of McCarthy’s critics, GOP Rep. Scott Perry of Pennsylvania, tweeted that he had switched to supporting the top Republican due to that deal.

“The framework for an agreement is in place, so in a good-faith effort, I voted to restore the People’s House by voting for @gopleader McCarthy,” Perry said.

See: Kevin McCarthy’s speaker deal to win over holdouts would ‘neuter’ him, and could mean more government shutdowns

There hadn’t been a need for multiple votes for a speaker election since 1923, and it’s the most ballots required since1860, just before the Civil War, when 44 ballots were needed.

Related: Think the McCarthy House speaker vote is wild? Meet Frederick Huntington Gillett and Nathaniel P. Banks.

Analysts have warned that the tensions over what’s typically a ceremonial election could signal that the GOP-run House will be dysfunctional throughout 2023 and 2024.

“In our view, the challenge to McCarthy underscores the difficulty that a narrow and fractured GOP majority will have in working with Democrats in the Senate on key issues such as the debt limit, government funding, and Ukraine in 2023,” said Benjamin Salisbury, director of research at Height Capital Markets, in a research note ahead of McCarthy’s election.

Related: Fight over House speaker job offers ‘ominous portent of how the U.S. debt-ceiling fight will go,’ analyst says

Republicans have taken control of the House thanks to wins in November’s midterm elections, returning to power in that chamber after four years in the minority.

But the GOP’s hopes for a strong red wave two years into President Joe Biden’s term were dashed, as the party has claimed just a small House majority and Democrats have maintained their grip on the Senate.

U.S. stocks
SPX,
+2.28%

DJIA,
+2.13%
closed sharply higher Friday as a monthly employment report showed that wage growth had slowed even as the unemployment rate fell to 3.5%, fueling hopes that the Federal Reserve’s interest-rate hikes aimed at taming inflation are starting to have the desired effect.

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January 6, 2023
WHO is ‘concerned’ about coronavirus variant XBB.1.5 and its apparent growth advantage

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The global tally of COVID cases rose 25% in the period stretching from Dec. 5 to Jan. 1 to more than 14.5 million, the World Health Organization said Thursday.

Known case numbers appeared to fall in the latest week, but the WHO said those numbers were not reliable given the reduction in testing and delays in reporting during the year-end holiday period.

BA.5 and its sublineages remained dominant, based on sequences sent to a central database, with six under monitoring, including XBB and its sublineage XBB.1.5, which has become dominant in the U.S., according to data released last Friday by the Centers for Disease Control and Prevention.

While XBB.1.5 does not so far appear more lethal than earlier variants, it has spread fast across the U.S., rising from about 1.3% of cases in early December to about 41% in the week through Dec. 31.

“We are concerned about its growth advantage, in particular in some countries in Europe and the Northeast part of the United States, where XBB.1.5 has rapidly replaced other circulating sub-variants,” Maria Van Kerkhove, the WHO’s COVID technical lead, told reporters on Wednesday, as Politico reported.

U.S. numbers are also likely a little distorted by the holiday season, according to the team running a New York Times tracker.

The seven-day average for new U.S. cases stood at 64,087 on Wednesday, according to the tracker. That’s down 5% from two weeks ago and below the recent peak of 70,508 on Christmas Eve.

The daily average for hospitalizations was up 7% at 44,458. The average for deaths was 457, up 11% from two weeks ago.

Test positivity, meanwhile, has climbed 25% to 16%, and the number of patients in intensive-care units is up 8% to 5,312.

Cases are rising in 21 states, led by Louisiana, where they have climbed 75% from two weeks ago. On a per capita basis, New Jersey and New York are worst hit with an average of 34 cases per 100,000 people in the former and an average of 29 cases per 100,000 people in the latter.

Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

Other COVID-19 news you should know about:

• Chinese hospitals are running out of beds as they struggle with a wave of COVID cases in the wake of the government’s scrapping of what were the most strict restrictions in the world, the Associated Press reported. Patients, mostly older people, laid on stretchers in hallways or took oxygen while sitting in wheelchairs as a COVID-19 outbreak stretched public health facilities’ resources in China’s capital Beijing, even after its reported peak. The Chuiyangliu hospital in the city’s east was packed Thursday with newly arrived patients. Beds ran out by midmorning, even as ambulances continued to bring more people in. Hard-pressed nurses and doctors rushed to take information and triage the most urgent cases.

As China relaxes pandemic restrictions and reopens to foreign travelers, clinics and hospital hallways overflow with patients amid a wave of infections that is testing the healthcare system, following the abrupt removal of the so-called zero-Covid strategy. Photo: Noel Celis/AFP/Getty Images

• The European Union on Wednesday “strongly encouraged” its member states to impose pre-departure COVID-19 testing of passengers from China, in a move that is likely to upset Beijing and has already been criticized by the global airline industry, the AP reported separately. Following a week of talks between EU health experts, the bloc stopped short of agreeing that all 27 member states impose such a travel restriction that members like Italy, France and Spain had already implemented at a national level. Instead, it only urged nations to do so. China has already vehemently rejected such actions, warning of “countermeasures” if such policies were to be imposed across the bloc.

• The collapse of Buffalo Bills safety Damar Hamlin during a Monday game has given rise to another series of unfounded claims about COVID vaccines, showing that vaccine misinformation remains a threat to public safety three years after the pandemic began, BBC News reported. In what has become a familiar pattern since vaccines became available about two years ago, several influential accounts used the event to spread anti-vaccination content. They included the Georgia congresswoman Marjorie Taylor Greene, who tweeted: “Before the COVID vaccines we didn’t see athletes dropping dead on the playing field like we do now… Time to investigate the COVID vaccines.” The idea that young, healthy athletes have never collapsed suddenly before COVID vaccines is easily disproved, said the BBC.

• Hong Kong will start to reopen its border with mainland China on Sunday and allow tens of thousands of people to cross from each side every day without quarantine, the city’s leader said, as the AP reported. The city’s land and sea border checkpoints with the mainland have been largely closed for almost three years under China’s “zero-COVID” strategy, which has restricted entry to the country, isolated infected people and locked down areas with outbreaks. The reopening is expected to provide a much-needed boost to Hong Kong’s economy.

Here’s what the numbers say:

The global tally of confirmed cases of COVID-19 topped 662.4 million on Thursday, while the death toll rose above 7.5 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 101 million cases and 1,094,010 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 229.1 million people living in the U.S., equal to 69% of the total population, are fully vaccinated, meaning they have had their primary shots.

So far, just 47 million Americans have had the updated COVID booster that targets the original virus and the omicron variants, equal to 15.1% of the overall population.

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January 5, 2023
Trump’s Tax Law Echoed Through His Finances During White House Years
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Politics

Returns released by House show provisions of tax code that were used
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January 1, 2023
COVID-related ICU patients rise to 5-month high above 5,000—are new cases really falling?

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While many have been focused on the apparent explosion of COVID cases in China, and the lack of reliable data from China’s government, there are signs suggesting the U.S. situation is also getting worse even as case counts and deaths are falling.

At first look, initial fears of another COVID surge in the U.S. over the holidays may be overblown. About a week after the year-end holiday gatherings began, the seven-day average of new COVID cases fell to a more than three-week low of 58,354 on Thursday, down 9% from two weeks ago and down 17% from a recent peak of 70,508 on Christmas Eve, according to a New York Times tracker.

And the daily average for deaths fell has fallen to a three-week low of 355, and has dropped 5% in two weeks.

But as the NYT tracker has been warning, case and death counts could be “artificially low” this week, as officials who track those numbers take vacation for the Christmas and New Year’s holidays. Therefore, hospitalization data, which is typically not affected by holidays, should remain more reliable.

And by that measure, the numbers are getting worrisome.

The daily average of hospitalizations rose to 41,620 on Thursday, up 3% from two weeks ago but also the highest number seen since mid-August.

There are 29 states that have seen hospitalizations increase from two weeks ago, including 20 states that have seen double-digit percentage increases, led by South Carolina at 54%, West Virginia at 52% and Louisiana at 47%.

The number of severe COVID cases is also seeing a troubling rise, the daily average of COVID-related patients in intensive care units (ICUs) climbed to 5,080 on Thursday. That’s up 10% from two weeks ago, and the most seen since July 30.

The New York Times

Another sign that the fall in case counts is artificial is that the test positivity rate has been rising, to a four-month high above 14% on Thursday, with 41 states seeing double-digit positivity rates.

“Higher test positivity rates are a sign that many infections are not reported — even if they are tested at home. This results in a more severe undercount of cases,” the NYT tracker said.

The New York Times

Stay up to date on COVID news through MarketWatch’s daily “Coronavirus Update” column.

Meanwhile in China, amid a “lack of adequate and transparent” data from China’s government, there is reason to believe the situation will still get a lot worse before it gets better.

U.K. health firm Airfinity estimates that new daily COVID cases in China is currently running at about 1.8 million, based on data from China’s regional provinces, and on new-case trajectories from areas that also lifted zero-COVID policies, such as Hong Kong.

That case number is expected to more than double, to about 3.7 million a day, in mid-January, Airfinity estimates, before another surge in March takes the number up to about 4.2 million per day.

As a result of the concerns over surging case counts, Spain joined the growing number of countries that are requiring COVID tests for air passengers arriving from China, as the Associated Press reported. This comes after the European Union said Thursday that it is “assessing” the situation in China.

The U.S. will also require those arriving from China to take a PCR test, starting Jan. 5, while Japan started requiring a test on Friday. Other countries requiring a test for air passengers from China include Italy, India and South Korea.

The BBC reported that the U.K. was set to announce that travelers will need to show a negative COVID test before they board a plane from China.

In other COVID news, China’s National Medical Products Administration has given emergency approval to Merck & Co. Inc.’s
MRK,
-0.33%
COVID antiviral molnupiravir. That joins Pfizer Inc.’s
PFE,
-0.96%
Paxlovid, which has already been approved for use in China. Merck’s stock, which fell 0.4% in afternoon trading Friday, has soared 44.0% in 2022, while the Dow Jones Industrial Average
DJIA,
-0.88%
has lost 9.4%.

Novavax Inc.
NVAX,
+0.21%
said Friday that it has initiated a Phase 2 trial for its COVID-19-Influenza Combination (CIC) vaccine candidate in people aged 50 through 80. “We believe that like influenza, COVID-19 will also be seasonal moving forward, and that there is room in the market for new alternatives to provide better protection against the impact of influenza, particularly in older adults, and to explore the potential to combine this with protection from COVID,” said Chief Executive Stanley Erck. Novavax’s stock, which eased 0.3% Friday, has plunged 93.2% year to date while the S&P 500 index
SPX,
-1.03%
has dropped 20.1%.

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December 30, 2022
Trump’s tax returns are now public after long fight with Congress

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The U.S. House Ways and Means Committee released six years of former President Donald Trump’s tax returns on Friday.

Experts will be looking closely at large business losses reported by Trump that significantly reduced his tax liability. For instance, he paid no federal taxes in 2020.

“Trump paid miniscule income taxes in 2015-2020, and almost no income taxes for the prior three decades,” said Steve Rosenthal, a senior fellow at the Tax Policy Center in Washington, in an email.

“We also have learned that, in the 1990s and 2000s, Trump claimed business losses of tens and sometimes hundreds of millions annually. I studied these a few years ago and found some real, and some fake,” he added.

“It is still early to determine how much of Trump’s most recent losses were real or fake,” Rosenthal said.

Read: Trump paid $0 taxes in 2020. He’s not alone

Analysts are also going to pore over the documents for any details of Trump’s foreign business dealings.

Some certified public accountants who looked at the documents say the returns show that the U.S. tax system has been written to “incentivize” real estate investing.

Bottom line: In order to generate these kinds of losses, you need to be super rich. It’s not a poor man’s game,” said Jonathan Medows, managing member of Medows CPA PLLC in New York.

Read: CPAs have questions about Trump’s tax returns

David Cay Johnston, a Pulitzer Prize winning author and longtime Trump critic, in a post on his non-profit news organization DC Report, called the former president’s tax returns “a rich environment in which questionable conduct is found throughout the filings and needs only seasoned auditors to uncover fictional expenditures.”

He said that Trump was warned by two New York state judges in trials about his 1984 taxes not to deduct huge expenses in businesses with no revenue.

“That Trump persisted in using the same fraudulent technique in six years of recent tax returns is powerful evidence of criminal intent,” Johnston wrote.

In a statement, Trump said his returns show “how I have been able to use depreciation and various other tax deductions as an incentive for creating thousands of jobs.”

Key words: Trump on release of his tax returns

Some experts said they were going to look at the returns for details about Trump’s foreign sources of income. The documents show that Trump had foreign bank accounts while he was president.

See: What could be learned from Trump’s tax returns

Democrats on the Ways and Means Committee said they voted to release the Trump tax returns to help improve the tax laws. Republicans warned that the release would set a precedent where political parties routinely release the tax returns of their opponents.

Another question is why the Internal Revenue Service failed to audit Trump’s tax returns as it routinely does for U.S. presidents.

See: Trump taxes could rev up fight over IRS funding

On Jan. 3, Republicans will take control of the House along with the tax-writing committee.

Rep. Don Beyer, a Democrat from Virginia who is a member of the Ways and Means Committee, said the Trump tax returns “underscore the fact that our tax laws are often inequitable and that enforcement of them is often unjust.”

Rep. Kevin Brady, the Republican from Texas who was the minority leader of the Ways and Means panel and is leaving Congress in January, said Democrats did not release the Trump tax records for any legislative purpose but wanted to “unleash a dangerous new political weapon” at the former president.

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December 30, 2022
China Regulator Says Futu, Up Fintech Violated Laws

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China Regulator Says Futu, Up Fintech Violated Laws

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December 30, 2022

China Approves Merck’s Molnupiravir for Emergency Use, Regulator Says

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China’s top drug regulator said Friday that it approved Merck & Co.’s Molnupiravir for emergency use on Thursday, as the country grapples with waves of infections after Beijing abruptly reversed its stringent Covid-19 restrictions earlier this month.

The National Medical Products Administration said it is requiring the approval holder to continue relevant research, complete conditional requirements and submit follow-up research results in a timely manner, according to a statement posted on its website Friday.

Write to Singapore Editors at singaporeeditors@dowjones.com

Corrections & Amplifications

This item was corrected at 0856 GMT to reflect China’s top drug regulator said it approved Merck & Co.’s Molnupiravir for emergency use on Thursday. The original version incorrectly said the approval came on Wednesday in the first paragraph.

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December 30, 2022

CDC calls out China for ‘lack of adequate and transparent’ COVID data

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China is facing an international backlash amid reports of an unchecked surge in COVID-19 cases in the country, as well as criticism over the government’s decision to stop providing daily COVID data.

A growing number of countries, including the U.S., have announced COVID-testing requirements for people traveling from China, as the outbreak there increases the risk that new coronavirus variants could emerge and spread.

Read: MarketWatch’s daily ‘Coronavirus Update’ column

Don’t miss: Lack of data on China’s COVID-19 surge stirs global concern

The U.S. Centers for Disease Control and Prevention said Wednesday that it was implementing a requirement for a negative COVID-19 test or documentation of recovery for passengers from China, Hong Kong and Macau boarding flights to the U.S.

“CDC is announcing this step to slow the spread of COVID-19 in the United States during the surge of COVID-19 cases in the [People’s Republic of China] given the lack of adequate and transparent epidemiological and viral genomic sequence data being reported from the PRC,” the agency said in a statement. “These data are critical to monitor the case surge effectively and decrease the chance for entry of a novel variant of concern.”

Japan said that starting Dec. 30, a COVID-19 test will be required on arrival for those who have stayed in China. excluding Hong Kong and Macau, within seven days of arrival, and for all who arrive directly from China, again excluding Hong Kong and Macau. Those who do test positive will be required to isolate at a government-designated facility.

The European Union said it is assessing the surge in cases in China and would be will ready to use the “emergency brake” if necessary, the Associated Press reported. The EU tried to soothe fears, however, by saying the BF.7 omicron variant that was prevalent in China was already active in Europe and does not pose an immediate danger.

Italy is already requiring COVID tests for all airline passengers arriving from China. More than half of those tested on arrival at Milan’s Malpensa Airport in recent days have tested positive, the AP reported.

On the bright side, Italy said the positive tests of people arriving from China didn’t include any new coronavirus variants of concern, Bloomberg reported.

India and South Korea have also announced test mandates for airline passengers arriving from China.

Meanwhile, in the U.S., new cases and deaths have been falling, while hospitalizations and test-positivity rates are increasing.

The seven-day average of new COVID cases fell to a three-week low of 64,410 on Wednesday, according to a New York Times tracker. That’s down from a recent peak of 70,508 on Christmas Eve and down 2% from two weeks ago.

The daily average of COVID-related deaths fell to 345 on Wednesday, also a three-week low, and is down 24% from two weeks ago.

The New York Times tracker cautioned that reports for cases and deaths could be artificially low this week as U.S. officials who track the data take time off over the holidays. Hospitalization data, which is not typically affected by holiday breaks, is more reliable.

The daily average of COVID-related hospitalizations rose to 40,497 from 39,880 on Tuesday and has increased 1% from two weeks ago. And more worrisome, the number of COVID patients in intensive-care units jumped 10% from two weeks ago to 4,997, the most since early August.

The test-positivity rate rose to above 14% on Wednesday, a four-month high, and has increased by 18% in two weeks. Higher test-positivity rates suggest that many new COVID cases, such as those found through at-home testing, are not being reported to official case trackers, the New York Times said.

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December 29, 2022

Tag: Regulation/Government Policy

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