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How Trump's Tariff Punch Hurt His Pro-Business Agenda - WSJ - 0 views

www.wsj.com/...pro-business-agenda-1520032652 tariff inflation stock european ally
shared by runlai_jiang on 04 Mar 18 - No Cached
  • Markets fell after President Donald Trump announced planned tariffs on steel and aluminum imports, an effect that was exacerbated by what the move symbolizes fo
  • When a key economic input suddenly becomes scarce,  it’s called a supply shock: It pushes costs up and economic activity down.
  • This helps explain why markets have responded so badly to President Donald Trump’s announcement of a 25% tariff on steel imports and 10% on aluminum. Like a geopolitical shock that reduces the supply of oil, it’s bad for both inflation and growth.
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  • exacerbated by what the tariffs symbolize for Mr. Trump’s agenda and the broader global economy.
  • By following his nationalist instincts Mr. Trump has broken with the pro-business factions in his administration and his party whose policy priorities have been critical to the upswing in business and investor sentiment since he was elected. By willingly hurting U.S. allies over a problem of overcapacity that is mainly China’s doing, he’s cast further uncertainty over the U.S. role as global leader.
  • With investors already on edge about Federal Reserve interest rate increases, the steel tariffs at the margin compound inflation pressure. That effect is so far too small to alter the Fed’s calculus, but a tit-for-tat cycle of retaliation could lead to even more inflation and rate increases than investors or the Fed have anticipated.
  • Protectionism shrinks markets, raises costs, and reduces how fast a country can grow without generating inflation. U.S. steel and aluminum companies can meet the demand previously filled by imports, but with unemployment at a 17-year low that may require hiring workers away from other industries, putting upward pressure on wages.
  • This is good news in the short run for workers, but bad news for any consumer who must now pay more for cars or beer cans.
  • nvestors speculated that the angry reaction of American allies, in particular the European Union, showed U.S. global leadership is fading and with it the dollar’s appeal as a reserve currency.
  • China may move more quickly to curb its overcapacity, the root of the import surge and price pressure that is hurting U.S. producers. Yet the decision has generated conflict within his own administration, his party and with key U.S. allies that, at least at the margin, counteracts the boost from the rest of his agenda.
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Markets Eye December Jobs Report - 0 views

www.wsj.com/...report-stocks-bonds-employment
shared by abbykleman on 06 Jan 17 - No Cached
  • abbykleman on 06 Jan 17
     
    If we see a strong jobs number at 8:30 a.m., stock traders could put the world back on watch for Dow 20000 when the opening bell rings at 9:30 a.m. It's been just 30 trading sessions since the Dow Jones Industrial first closed above 19000 in the days after the presidential election.
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In No One We Trust - NYTimes.com - 0 views

opinionator.blogs.nytimes.com/...in-no-one-we-trust trust inequality banking economics history
shared by Javier E on 25 Dec 13 - No Cached
  • that doesn’t mean we should stop striving for a bit more trust in our society and our economy. Trust is what makes contracts, plans and everyday transactions possible; it facilitates the democratic process, from voting to law creation, and is necessary for social stability. It is essential for our lives. It is trust, more than money, that makes the world go round.
  • , as more and more people lose faith in a system that seems inexorably stacked against them, and the 1 percent ascend to ever more distant heights, this vital element of our institutions and our way of life is eroding.
  • But events — and economic research — over the past 30 years have shown not only that we cannot rely on self-interest, but also that no economy, not even a modern, market-based economy like America’s, can function well without a modicum of trust — and that unmitigated selfishness inevitably diminishes trust.
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  • Adam Smith argued forcefully that we would do better to trust in the pursuit of self-interest than in the good intentions of those who pursue the general interest. If everyone looked out for just himself, we would reach an equilibrium that was not just comfortable but also productive, in which the economy was fully efficient. To the morally uninspired, it’s an appealing idea: selfishness as the ultimate form of selflessness. (Elsewhere, in particular in his “Theory of Moral Sentiments,” Smith took a much more balanced view, though most of his latter-day adherents have not followed suit.)
  • This cascade of trust destruction was unrelenting. One of the reasons that the bubble’s bursting in 2007 led to such an enormous crisis was that no bank could trust another. Each bank knew the shenanigans it had been engaged in — the movement of liabilities off its balance sheets, the predatory and reckless lending — and so knew that it could not trust any other bank
  • Things didn’t turn out well for our economy or our society. As millions lost their homes during and after the crisis, median wealth declined nearly 40 percent in three years. Banks would have done badly, too, were it not for the Bush-Obama mega-bailouts.
  • bankers used their political influence to eviscerate regulations and install regulators who didn’t believe in them. Officials and academics assured lawmakers and the public that banks could self-regulate. But it all turned out to be a scam. We had created a system of rewards that encouraged shortsighted behavior and excessive risk-taking. In fact, we had entered an era in which moral values were given short shrift and trust itself was discounted.
  • THE banking industry is only one example of what amounts to a broad agenda, promoted by some politicians and theoreticians on the right, to undermine the role of trust in our economy. This movement promotes policies based on the view that trust should never be relied on as motivation, for any kind of behavior, in any context. Incentives, in this scheme, are all that matter.
  • So C.E.O.’s must be given stock options to induce them to work hard. I find this puzzling: If a firm pays someone $10 million to run a company, he should give his all to ensure its success. He shouldn’t do so only if he is promised a big chunk of any increase in the company’s stock market value
  • Of course, incentives are an important component of human behavior. But the incentive movement has made them into a sort of religion, blind to all the other factors — social ties, moral impulses, compassion — that influence our conduct.
  • Similarly, teachers must be given incentive pay to induce them to exert themselves. But teachers already work hard for low wages because they are dedicated to improving the lives of their students. Do we really believe that giving them $50 more, or even $500 more, as incentive pay will induce them to work harder? What we should do is increase teacher salaries generally because we recognize the value of their contributions and trust in their professionalism. According to the advocates of an incentive-based culture, though, this would be akin to giving something for nothing.
  • This is not just a coldhearted vision of human nature. It is also implausible. It is simply impossible to pay for trust every time it is required. Without trust, life would be absurdly expensive; good information would be nearly unobtainable; fraud would be even more rampant than it is; and transaction and litigation costs would soar.
  • When 1 percent of the population takes home more than 22 percent of the country’s income — and 95 percent of the increase in income in the post-crisis recovery — some pretty basic things are at stake. Reasonable people, even those ignorant of the maze of unfair policies that created this reality, can look at this absurd distribution and be pretty certain that the game is rigged.
  • Trust between individuals is usually reciprocal. But if I think that you are cheating me, it is more likely that I will retaliate, and try to cheat you. (These notions have been well developed in a branch of economics called the “theory of repeated games.”) When Americans see a tax system that taxes the wealthiest at a fraction of what they pay, they feel that they are fools to play along.
  • a deeper rot takes hold: Attitudes and norms begin to change. When no one is trustworthy, it will be only fools who trust. The concept of fairness itself is eroded. A study published last year by the National Academy of Sciences suggests that the upper classes are more likely to engage in what has traditionally been considered unethical behavior. Perhaps this is the only way for some to reconcile their worldview with their outlandish financial success, often achieved through actions that reveal a kind of moral deprivation.
  • As always, it is the poor and the unconnected who suffer most from this, and who are the most repeatedly deceived. Nowhere was this more evident than in the foreclosure crisis.
  • The banks figured out how to get court affidavits signed by the thousands (in what came to be called robo-signing), certifying that they had examined their records and that these particular individuals owed money — and so should be booted out of their homes. The banks were lying on a grand scale, but they knew that if they didn’t get caught, they would walk off with huge profits, their officials’ pockets stuffed with bonuses. And if they did get caught, their shareholders would be left paying the tab
  • But perhaps even more than opportunity, Americans cherish equality before the law. Here, inequality has infected the heart of our ideals.
  • I suspect there is only one way to really get trust back. We need to pass strong regulations, embodying norms of good behavior, and appoint bold regulators to enforce them.
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Billionaires' Row and Welfare Lines - NYTimes.com - 0 views

www.nytimes.com/...res-row-and-welfare-lines.html inequality economic benefit crisis US
shared by Javier E on 26 Oct 13 - No Cached
  • The stock market is hitting record highs.
  • Bank profits have reached their highest levels in years.
  • in August, “Sales of homes priced at more than $1 million jumped an average 37 percent in 2013’s first half from a year earlier to the highest level since 2007,
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  • “In 2012, real median household income was 8.3 percent lower than in 2007, the year before the most recent recession.”
  • Forbes’s list of the world’s billionaires has added more than 200 names since 2012 and is now at 1,426. The United States once again leads the list, with 442 billionaires.
  • Measure of America, a project of the Social Science Research Council, recently released a study finding that a staggering 5.8 million young people nationwide — one in seven of those ages 16 to 24 — are disconnected, meaning not employed or in school, “adrift at society’s margins,” as the group put it.
  • developers are turning 57th Street in Manhattan into “Billionaires’ Row,” with apartments selling for north of $90 million each.
  • “During the first two years of the nation’s economic recovery, the mean net worth of households in the upper 7 percent of the wealth distribution rose by an estimated 28 percent, while the mean net worth of households in the lower 93 percent dropped by 4 percent.”
  • “The 1,168,354 homeless students enrolled by U.S. preschools and K-12 schools in the 2011-2012 school year is the highest number on record, and a 10 percent increase over the previous school year. The number of homeless children in public schools has increased 72 percent since the beginning of the recession.”
  • “These new poverty estimates released on Sept. 19, 2013, suggest that child poverty plateaued in the aftermath of the Great Recession, but there is no evidence of any reduction in child poverty even as we enter the fourth year of ‘recovery.’ ”
  • the number of households living on $2 or less in income per person per day in a given month increased from about 636,000 in 1996 to about 1.46 million households in early 2011, a percentage growth of 130 percent.”
  • “Cash assistance benefits for the nation’s poorest families with children fell again in purchasing power in 2013 and are now at least 20 percent below their 1996 levels in 37 states, after adjusting for inflation.”
  • The number of Americans now enrolled in the Supplemental Nutrition Assistance Program (SNAP) is near record highs, and yet both houses of Congress have passed bills to cut funding to the program. The Senate measure would cut about $4 billion, while the House measure would cut roughly ten times as much, dropping millions of Americans from the program.
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No Lehman Repeat, but a Great Opportunity to Lose Money Is Coming Anyway - WSJ - 0 views

www.wsj.com/...ey-is-coming-anyway-1536859262 investment market outlook
shared by Javier E on 17 Sep 18 - No Cached
  • forecasting recessions is hard, and economists have failed miserably at it in the past. But to simplify massively, recessions happen when the economy runs out of cheap money or resources to support growth.
  • Right now, the cost of money is low in historical terms, but actually high when compared to what investors believe is sustainable in the long term. We can measure that by comparing the yield of short-term and long-term debt, known as the yield curve. When the cost of short-term money, often proxied by the two-year Treasury yield, rises above 10-year yields, a U.S. recession has almost always followed.
  • The yield curve hasn’t yet inverted, but the New York Fed’s model based on yields puts the probability of a recession in the next 12 months at 15%. That is the highest since the last recession and the same as in the summer of 2006, about 18 months before the recession began.
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  • Instead of forecasting, we could look for signs that money is tight by watching the most vulnerable markets. Turmoil in the Turkish lira and Argentine peso may be linked to the increased cost of borrowing in dollars
  • On the resource side, oil is a natural place to look for shortages that might constrict the economy and end a boom
  • If we knew the cycle would end soon, investing would be easy: Dump stocks for bonds. But the final phase can sometimes last for years, during which rising yields hit bond prices while stocks typically do very well.
  • Financial crises are worse, and we shouldn’t forget Lehman. But when the end of the economic cycle comes, investors should expect big losses even if banks don’t totter
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U.S. intelligence reports from January and February warned about a likely pandemic - Th... - 0 views

www.washingtonpost.com/...a-b5f1-a5a804158597_story.html intelligence reports us pandemic crisis trump politics policy
shared by Javier E on 31 Mar 20 - No Cached
  • U.S. intelligence agencies were issuing ominous, classified warnings in January and February about the global danger posed by the coronavirus while President Trump and lawmakers played down the threat and failed to take action that might have slowed the spread of the pathogen, according to U.S. officials familiar with spy agency reporting.
  • they did track the spread of the virus in China, and later in other countries, and warned that Chinese officials appeared to be minimizing the severity of the outbreak.
  • Taken together, the reports and warnings painted an early picture of a virus that showed the characteristics of a globe-encircling pandemic that could require governments to take swift actions to contain it
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  • But despite that constant flow of reporting, Trump continued publicly and privately to play down the threat the virus posed to Americans.
  • Intelligence agencies “have been warning on this since January,” said a U.S. official who had access to intelligence reporting that was disseminated to members of Congress and their staffs as well as to officials in the Trump administration
  • “Donald Trump may not have been expecting this, but a lot of other people in the government were — they just couldn’t get him to do anything about it,” this official said. “The system was blinking red.”
  • The warnings from U.S. intelligence agencies increased in volume toward the end of January and into early February, said officials familiar with the reports. By then, a majority of the intelligence reporting included in daily briefing papers and digests from the Office of the Director of National Intelligence and the CIA was about covid-19, said officials who have read the reports.
  • The surge in warnings coincided with a move by Sen. Richard Burr (R-N.C.) to sell dozens of stocks worth between $628,033 and $1.72 million.
  • A key task for analysts during disease outbreaks is to determine whether foreign officials are trying to minimize the effects of an outbreak or take steps to hide a public health crisis
  • At the State Department, personnel had been nervously tracking early reports about the virus. One official noted that it was discussed at a meeting in the third week of January, around the time that cable traffic showed that U.S. diplomats in Wuhan were being brought home on chartered planes — a sign that the public health risk was significant
  • Inside the White House, Trump’s advisers struggled to get him to take the virus seriously, according to multiple officials with knowledge of meetings among those advisers and with the president.
  • Azar couldn’t get through to Trump to speak with him about the virus until Jan. 18, according to two senior administration officials. When he reached Trump by phone, the president interjected to ask about vaping and when flavored vaping products would be back on the market
  • On Jan. 27, White House aides huddled with then-acting chief of staff Mick Mulvaney in his office, trying to get senior officials to pay more attention to the virus
  • Joe Grogan, the head of the White House Domestic Policy Council, argued that the administration needed to take the virus seriously or it could cost the president his reelection, and that dealing with the virus was likely to dominate life in the United States for many months.
  • Trump was dismissive because he did not believe that the virus had spread widely throughout the United States.
  • By early February, Grogan and others worried that there weren’t enough tests to determine the rate of infection, according to people who spoke directly to Grogan
  • But Trump resisted and continued to assure Americans that the coronavirus would never run rampant as it had in other countries.“I think it’s going to work out fine,” Trump said on Feb. 19. “I think when we get into April, in the warmer weather, that has a very negative effect on that and that type of a virus.”
  • “The Coronavirus is very much under control in the USA,” Trump tweeted five days later. “Stock Market starting to look very good to me!”
  • But earlier that month, a senior official in the Department of Health and Human Services delivered a starkly different message to the Senate Intelligence Committee, in a classified briefing that four U.S. officials said covered the coronavirus and its global health implications. The House Intelligence Committee received a similar briefing.
  • Robert Kadlec, the assistant secretary for preparedness and response — who was joined by intelligence officials, including from the CIA — told committee members that the virus posed a “serious” threat, one of those officials said.
  • he said that to get ahead of the virus and blunt its effects, Americans would need to take actions that could disrupt their daily lives, the official said. “It was very alarming.”
  • Trump’s insistence on the contrary seemed to rest in his relationship with China’s President Xi Jingping, whom Trump believed was providing him with reliable information about how the virus was spreading in China, despite reports from intelligence agencies that Chinese officials were not being candid about the true scale of the crisis.
  • Some of Trump’s advisers told him that Beijing was not providing accurate numbers
  • Rather than press China to be more forthcoming, Trump publicly praised its response.
  • “China has been working very hard to contain the Coronavirus,” Trump tweeted Jan. 24. “The United States greatly appreciates their efforts and transparency. It will all work out well. In particular, on behalf of the American People, I want to thank President Xi!”
  • Trump on Feb. 3 banned foreigners who had been in China in the previous 14 days from entering the United States, a step he often credits for helping to protect Americans against the virus. He has also said publicly that the Chinese weren’t honest about the effects of the virus. But that travel ban wasn’t accompanied by additional significant steps to prepare
  • As the first cases of infection were confirmed in the United States, Trump continued to insist that the risk to Americans was small.“I think the virus is going to be — it’s going to be fine,” he said on Feb. 10
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Donald Trump's catastrophic coronavirus failure confirms dire predictions. - The Washin... - 0 views

www.washingtonpost.com/...ned-if-hillary-clinton-had-won trump failure predictions presidency crisis
shared by Javier E on 22 Mar 20 - No Cached
  • There were scattered warnings before Pearl Harbor and 9/11 of what was to come. But nothing like this. My Post colleagues report that throughout January and February, the U.S. intelligence community was warning Trump that the pandemic was going to hit America. “The system was blinking red,” one official said.
  • ecause of Trump’s negligence, the United States lost two months of response time — precious days that should have been used to test the population, produce more N95 masks and ventilators, and build new hospital beds
  • I weep in anger and frustration imagining what might have been if Hillary Clinton — a sane, sensible adult — had won. We couldn’t have avoided the coronavirus, but we could have ameliorated its effects. We could be South Korea (102 deaths) rather than Italy (4,825 deaths and counting).
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  • It took no foresight to predict that Trump would be a catastrophe in a crisis. It was close to the conventional wisdom. Yet nearly 63 million voters chose to disregard such warnings.
  • There were many reasons Trump won. Ironically, one of the most oft-cited was the desire to blow everything up, because Trump voters were convinced that things couldn’t get any worse than they were in 2016.
  • As they shelter in their homes and the economy grinds to a halt, I wonder if perhaps they now realize how good they had it under President Barack Obama?
  • For the past three years, Trump supporters have scoffed at critics, claiming we are out-of-touch, pointy-headed, coastal elitists too focused on Trump’s unconventional way of speaking while ignoring his historic policy achievements — meaning an expanding economy that he inherited from Obama. Perhaps they would like to rethink that argument now that the stock market has given up all of the gains it made under Trump and the unemployment numbers are heading for Great Depression levels?
  • The underlying assumption was that the federal government is so unimportant that it could be handed over safely to a reality TV star who revels in “unpresidented” behavior.
  • This was the result of post-Cold War, post-9/11 complacency, with voters imagining that they could take peace and prosperity for granted.
  • If the coronavirus should teach us anything, it is that governing is a deadly serious business. Electing a grown-up isn’t a luxury; it’s a matter of life and death.
  • The price of “owning the libs” turns out to be far higher than even most Trump critics could have imagined.
  • In a way, you almost can’t blame Trump for his epic incompetence: He is who he is. He didn’t deceive anyone.
  • I blame the voters who elected him — and the senators who refused to impeach him. They should have known better. Because they didn’t, we will all pay a fearful price.
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He Could Have Seen What Was Coming: Behind Trump's Failure on the Virus - The New York ... - 0 views

www.nytimes.com/...oronavirus-trump-response.html pandemic failure trump policy politics crisis
shared by Javier E on 12 Apr 20 - No Cached
  • “Any way you cut it, this is going to be bad,” a senior medical adviser at the Department of Veterans Affairs, Dr. Carter Mecher, wrote on the night of Jan. 28, in an email to a group of public health experts scattered around the government and universities. “The projected size of the outbreak already seems hard to believe.”
  • A week after the first coronavirus case had been identified in the United States, and six long weeks before President Trump finally took aggressive action to confront the danger the nation was facing — a pandemic that is now forecast to take tens of thousands of American lives — Dr. Mecher was urging the upper ranks of the nation’s public health bureaucracy to wake up and prepare for the possibility of far more drastic action.
  • Throughout January, as Mr. Trump repeatedly played down the seriousness of the virus and focused on other issues, an array of figures inside his government — from top White House advisers to experts deep in the cabinet departments and intelligence agencies — identified the threat, sounded alarms and made clear the need for aggressive action.
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  • The president, though, was slow to absorb the scale of the risk and to act accordingly, focusing instead on controlling the message, protecting gains in the economy and batting away warnings from senior officials.
  • Mr. Trump’s response was colored by his suspicion of and disdain for what he viewed as the “Deep State” — the very people in his government whose expertise and long experience might have guided him more quickly toward steps that would slow the virus, and likely save lives.
  • The slow start of that plan, on top of the well-documented failures to develop the nation’s testing capacity, left administration officials with almost no insight into how rapidly the virus was spreading. “We were flying the plane with no instruments,” one official said.
  • But dozens of interviews with current and former officials and a review of emails and other records revealed many previously unreported details and a fuller picture of the roots and extent of his halting response as the deadly virus spread:
  • The National Security Council office responsible for tracking pandemics received intelligence reports in early January predicting the spread of the virus to the United States, and within weeks was raising options like keeping Americans home from work and shutting down cities the size of Chicago. Mr. Trump would avoid such steps until March.
  • Despite Mr. Trump’s denial weeks later, he was told at the time about a Jan. 29 memo produced by his trade adviser, Peter Navarro, laying out in striking detail the potential risks of a coronavirus pandemic: as many as half a million deaths and trillions of dollars in economic losses.
  • The health and human services secretary, Alex M. Azar II, directly warned Mr. Trump of the possibility of a pandemic during a call on Jan. 30, the second warning he delivered to the president about the virus in two weeks. The president, who was on Air Force One while traveling for appearances in the Midwest, responded that Mr. Azar was being alarmist
  • Mr. Azar publicly announced in February that the government was establishing a “surveillance” system
  • the task force had gathered for a tabletop exercise — a real-time version of a full-scale war gaming of a flu pandemic the administration had run the previous year. That earlier exercise, also conducted by Mr. Kadlec and called “Crimson Contagion,” predicted 110 million infections, 7.7 million hospitalizations and 586,000 deaths following a hypothetical outbreak that started in China.
  • By the third week in February, the administration’s top public health experts concluded they should recommend to Mr. Trump a new approach that would include warning the American people of the risks and urging steps like social distancing and staying home from work.
  • But the White House focused instead on messaging and crucial additional weeks went by before their views were reluctantly accepted by the president — time when the virus spread largely unimpeded.
  • When Mr. Trump finally agreed in mid-March to recommend social distancing across the country, effectively bringing much of the economy to a halt, he seemed shellshocked and deflated to some of his closest associates. One described him as “subdued” and “baffled” by how the crisis had played out. An economy that he had wagered his re-election on was suddenly in shambles.
  • He only regained his swagger, the associate said, from conducting his daily White House briefings, at which he often seeks to rewrite the history of the past several months. He declared at one point that he “felt it was a pandemic long before it was called a pandemic,” and insisted at another that he had to be a “cheerleader for the country,” as if that explained why he failed to prepare the public for what was coming.
  • Mr. Trump’s allies and some administration officials say the criticism has been unfair.
  • The Chinese government misled other governments, they say. And they insist that the president was either not getting proper information, or the people around him weren’t conveying the urgency of the threat. In some cases, they argue, the specific officials he was hearing from had been discredited in his eyes, but once the right information got to him through other channels, he made the right calls.
  • “While the media and Democrats refused to seriously acknowledge this virus in January and February, President Trump took bold action to protect Americans and unleash the full power of the federal government to curb the spread of the virus, expand testing capacities and expedite vaccine development even when we had no true idea the level of transmission or asymptomatic spread,” said Judd Deere, a White House spokesman.
  • Decision-making was also complicated by a long-running dispute inside the administration over how to deal with China
  • The Containment IllusionBy the last week of February, it was clear to the administration’s public health team that schools and businesses in hot spots would have to close. But in the turbulence of the Trump White House, it took three more weeks to persuade the president that failure to act quickly to control the spread of the virus would have dire consequences.
  • There were key turning points along the way, opportunities for Mr. Trump to get ahead of the virus rather than just chase it. There were internal debates that presented him with stark choices, and moments when he could have chosen to ask deeper questions and learn more. How he handled them may shape his re-election campaign. They will certainly shape his legacy.
  • Facing the likelihood of a real pandemic, the group needed to decide when to abandon “containment” — the effort to keep the virus outside the U.S. and to isolate anyone who gets infected — and embrace “mitigation” to thwart the spread of the virus inside the country until a vaccine becomes available.
  • Among the questions on the agenda, which was reviewed by The New York Times, was when the department’s secretary, Mr. Azar, should recommend that Mr. Trump take textbook mitigation measures “such as school dismissals and cancellations of mass gatherings,” which had been identified as the next appropriate step in a Bush-era pandemic plan.
  • The group — including Dr. Anthony S. Fauci of the National Institutes of Health; Dr. Robert R. Redfield of the Centers for Disease Control and Prevention, and Mr. Azar, who at that stage was leading the White House Task Force — concluded they would soon need to move toward aggressive social distancing
  • A 20-year-old Chinese woman had infected five relatives with the virus even though she never displayed any symptoms herself. The implication was grave — apparently healthy people could be unknowingly spreading the virus — and supported the need to move quickly to mitigation.
  • The following day, Dr. Kadlec and the others decided to present Mr. Trump with a plan titled “Four Steps to Mitigation,” telling the president that they needed to begin preparing Americans for a step rarely taken in United States history.
  • a presidential blowup and internal turf fights would sidetrack such a move. The focus would shift to messaging and confident predictions of success rather than publicly calling for a shift to mitigation.
  • These final days of February, perhaps more than any other moment during his tenure in the White House, illustrated Mr. Trump’s inability or unwillingness to absorb warnings coming at him.
  • He instead reverted to his traditional political playbook in the midst of a public health calamity, squandering vital time as the coronavirus spread silently across the country.
  • A memo dated Feb. 14, prepared in coordination with the National Security Council and titled “U.S. Government Response to the 2019 Novel Coronavirus,” documented what more drastic measures would look like, including: “significantly limiting public gatherings and cancellation of almost all sporting events, performances, and public and private meetings that cannot be convened by phone. Consider school closures. Widespread ‘stay at home’ directives from public and private organizations with nearly 100% telework for some.”
  • his friend had a blunt message: You need to be ready. The virus, he warned, which originated in the city of Wuhan, was being transmitted by people who were showing no symptoms — an insight that American health officials had not yet accepted.
  • On the 18-hour plane ride home, Mr. Trump fumed as he watched the stock market crash after Dr. Messonnier’s comments. Furious, he called Mr. Azar when he landed at around 6 a.m. on Feb. 26, raging that Dr. Messonnier had scared people unnecessarily.
  • The meeting that evening with Mr. Trump to advocate social distancing was canceled, replaced by a news conference in which the president announced that the White House response would be put under the command of Vice President Mike Pence.
  • The push to convince Mr. Trump of the need for more assertive action stalled. With Mr. Pence and his staff in charge, the focus was clear: no more alarmist messages. Statements and media appearances by health officials like Dr. Fauci and Dr. Redfield would be coordinated through Mr. Pence’s office
  • It would be more than three weeks before Mr. Trump would announce serious social distancing efforts, a lost period during which the spread of the virus accelerated rapidly.Over nearly three weeks from Feb. 26 to March 16, the number of confirmed coronavirus cases in the United States grew from 15 to 4,226
  • The China FactorThe earliest warnings about coronavirus got caught in the crosscurrents of the administration’s internal disputes over China. It was the China hawks who pushed earliest for a travel ban. But their animosity toward China also undercut hopes for a more cooperative approach by the world’s two leading powers to a global crisis.
  • It was early January, and the call with a Hong Kong epidemiologist left Matthew Pottinger rattled.
  • Mr. Trump was walking up the steps of Air Force One to head home from India on Feb. 25 when Dr. Nancy Messonnier, the director of the National Center for Immunization and Respiratory Diseases, publicly issued the blunt warning they had all agreed was necessary.
  • It was one of the earliest warnings to the White House, and it echoed the intelligence reports making their way to the National Security Council
  • some of the more specialized corners of the intelligence world were producing sophisticated and chilling warnings.
  • In a report to the director of national intelligence, the State Department’s epidemiologist wrote in early January that the virus was likely to spread across the globe, and warned that the coronavirus could develop into a pandemic
  • Working independently, a small outpost of the Defense Intelligence Agency, the National Center for Medical Intelligence, came to the same conclusion.
  • By mid-January there was growing evidence of the virus spreading outside China. Mr. Pottinger began convening daily meetings about the coronavirus
  • The early alarms sounded by Mr. Pottinger and other China hawks were freighted with ideology — including a push to publicly blame China that critics in the administration say was a distraction
  • And they ran into opposition from Mr. Trump’s economic advisers, who worried a tough approach toward China could scuttle a trade deal that was a pillar of Mr. Trump’s re-election campaign.
  • Mr. Pottinger continued to believe the coronavirus problem was far worse than the Chinese were acknowledging. Inside the West Wing, the director of the Domestic Policy Council, Joe Grogan, also tried to sound alarms that the threat from China was growing.
  • The Consequences of ChaosThe chaotic culture of the Trump White House contributed to the crisis. A lack of planning and a failure to execute, combined with the president’s focus on the news cycle and his preference for following his gut rather than the data cost time, and perhaps lives.
  • the hawks kept pushing in February to take a critical stance toward China amid the growing crisis. Mr. Pottinger and others — including aides to Secretary of State Mike Pompeo — pressed for government statements to use the term “Wuhan Virus.”Mr. Pompeo tried to hammer the anti-China message at every turn, eventually even urging leaders of the Group of 7 industrialized countries to use “Wuhan virus” in a joint statement.
  • Others, including aides to Mr. Pence, resisted taking a hard public line, believing that angering Beijing might lead the Chinese government to withhold medical supplies, pharmaceuticals and any scientific research that might ultimately lead to a vaccine.
  • Mr. Trump took a conciliatory approach through the middle of March, praising the job Mr. Xi was doing.
  • That changed abruptly, when aides informed Mr. Trump that a Chinese Foreign Ministry spokesman had publicly spun a new conspiracy about the origins of Covid-19: that it was brought to China by U.S. Army personnel who visited the country last October.
  • On March 16, he wrote on Twitter that “the United States will be powerfully supporting those industries, like Airlines and others, that are particularly affected by the Chinese Virus.”
  • Mr. Trump’s decision to escalate the war of words undercut any remaining possibility of broad cooperation between the governments to address a global threat
  • Mr. Pottinger, backed by Mr. O’Brien, became one of the driving forces of a campaign in the final weeks of January to convince Mr. Trump to impose limits on travel from China
  • he circulated a memo on Jan. 29 urging Mr. Trump to impose the travel limits, arguing that failing to confront the outbreak aggressively could be catastrophic, leading to hundreds of thousands of deaths and trillions of dollars in economic losses.
  • The uninvited message could not have conflicted more with the president’s approach at the time of playing down the severity of the threat. And when aides raised it with Mr. Trump, he responded that he was unhappy that Mr. Navarro had put his warning in writing.
  • From the time the virus was first identified as a concern, the administration’s response was plagued by the rivalries and factionalism that routinely swirl around Mr. Trump and, along with the president’s impulsiveness, undercut decision making and policy development.
  • Even after Mr. Azar first briefed him about the potential seriousness of the virus during a phone call on Jan. 18 while the president was at his Mar-a-Lago resort in Florida, Mr. Trump projected confidence that it would be a passing problem.
  • “We have it totally under control,” he told an interviewer a few days later while attending the World Economic Forum in Switzerland. “It’s going to be just fine.”
  • The efforts to sort out policy behind closed doors were contentious and sometimes only loosely organized.
  • That was the case when the National Security Council convened a meeting on short notice on the afternoon of Jan. 27. The Situation Room was standing room only, packed with top White House advisers, low-level staffers, Mr. Trump’s social media guru, and several cabinet secretaries. There was no checklist about the preparations for a possible pandemic,
  • Instead, after a 20-minute description by Mr. Azar of his department’s capabilities, the meeting was jolted when Stephen E. Biegun, the newly installed deputy secretary of state, announced plans to issue a “level four” travel warning, strongly discouraging Americans from traveling to China. The room erupted into bickering.
  • A few days later, on the evening of Jan. 30, Mick Mulvaney, the acting White House chief of staff at the time, and Mr. Azar called Air Force One as the president was making the final decision to go ahead with the restrictions on China travel. Mr. Azar was blunt, warning that the virus could develop into a pandemic and arguing that China should be criticized for failing to be transparent.
  • Stop panicking, Mr. Trump told him.That sentiment was present throughout February, as the president’s top aides reached for a consistent message but took few concrete steps to prepare for the possibility of a major public health crisis.
  • As February gave way to March, the president continued to be surrounded by divided factions even as it became clearer that avoiding more aggressive steps was not tenable.
  • the virus was already multiplying across the country — and hospitals were at risk of buckling under the looming wave of severely ill people, lacking masks and other protective equipment, ventilators and sufficient intensive care beds. The question loomed over the president and his aides after weeks of stalling and inaction: What were they going to do?
  • Even then, and even by Trump White House standards, the debate over whether to shut down much of the country to slow the spread was especially fierce.
  • In a tense Oval Office meeting, when Mr. Mnuchin again stressed that the economy would be ravaged, Mr. O’Brien, the national security adviser, who had been worried about the virus for weeks, sounded exasperated as he told Mr. Mnuchin that the economy would be destroyed regardless if officials did nothing.
  • in the end, aides said, it was Dr. Deborah L. Birx, the veteran AIDS researcher who had joined the task force, who helped to persuade Mr. Trump. Soft-spoken and fond of the kind of charts and graphs Mr. Trump prefers, Dr. Birx did not have the rough edges that could irritate the president. He often told people he thought she was elegant.
  • During the last week in March, Kellyanne Conway, a senior White House adviser involved in task force meetings, gave voice to concerns other aides had. She warned Mr. Trump that his wished-for date of Easter to reopen the country likely couldn’t be accomplished. Among other things, she told him, he would end up being blamed by critics for every subsequent death caused by the virus.
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Live Stock Market Updates: Inflation and More - The New York Times - 0 views

www.nytimes.com/...stock-market-today
shared by mattrenz16 on 10 Mar 21 - No Cached
  • The federal budget deficit topped $1 trillion for the first five months of the fiscal year, as the United States recorded red ink at a record clip while trying to combat the coronavirus pandemic.
  • The Congressional Budget Office projected in February that the federal budget deficit will hit $2.3 trillion this year. Those numbers do not account for the $1.9 trillion relief package that Congress passed on Wednesday, which the C.B.O. estimates will add that amount to the deficit over the next 10 years.
  • Once the stimulus package is enacted, the White House is expected to push a costly infrastructure bill that it hopes will pass later this year.
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Moody's: Trump on his way to an easy 2020 win if economy holds up - 0 views

www.cnbc.com/...0-win-if-economy-holds-up.html
shared by anonymous on 26 Oct 19 - No Cached
  • Moody’s based its projections on how consumers feel about their own financial situation, the gains the stock market has achieved during Trump’s tenure and the prospects for unemployment, which has fallen to a 50-year low. Should those variables hold up, the president looks set to get another four-year term.
    • anonymous
      anonymous on 26 Oct 19
       
      Since Trump has helped a lot of people financially, they are most likely to vote for him again
  • “If the economy a year from now is the same as it is today, or roughly so, then the power of incumbency is strong and Trump’s election odds are very good, particularly if Democrats aren’t enthusiastic and don’t get out to vote,”
    • anonymous
      anonymous on 26 Oct 19
       
      Trumps economy is booming if this keeps up he will probably win
  • In the stock market model, Trump gets a 289-249 edge, while the unemployment model shows a 332-206 advantage. Across all three models, Trump wins 324-214.
    • anonymous
      anonymous on 26 Oct 19
       
      Numbers estimate of the numbers
  • ...1 more annotation...
  • Specifically, he said Luzerne County, in the northeast part of the state, “is the single-most important county, no kidding, in the entire election.” The longtime Democratic stronghold favored Trump, 51.8% to 46.8% in the election.Trump doesn’t even have to win the county, but merely needs a strong turnout, Zandi said.
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In No One We Trust - NYTimes.com - 0 views

opinionator.blogs.nytimes.com/...in-no-one-we-trust trust inequality banking economics history theory
shared by Javier E on 21 Dec 20 - No Cached
  • that doesn’t mean we should stop striving for a bit more trust in our society and our economy. Trust is what makes contracts, plans and everyday transactions possible; it facilitates the democratic process, from voting to law creation, and is necessary for social stability. It is essential for our lives. It is trust, more than money, that makes the world go round.
  • , as more and more people lose faith in a system that seems inexorably stacked against them, and the 1 percent ascend to ever more distant heights, this vital element of our institutions and our way of life is eroding.
  • Adam Smith argued forcefully that we would do better to trust in the pursuit of self-interest than in the good intentions of those who pursue the general interest. If everyone looked out for just himself, we would reach an equilibrium that was not just comfortable but also productive, in which the economy was fully efficient. To the morally uninspired, it’s an appealing idea: selfishness as the ultimate form of selflessness. (Elsewhere, in particular in his “Theory of Moral Sentiments,” Smith took a much more balanced view, though most of his latter-day adherents have not followed suit.)
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  • But events — and economic research — over the past 30 years have shown not only that we cannot rely on self-interest, but also that no economy, not even a modern, market-based economy like America’s, can function well without a modicum of trust — and that unmitigated selfishness inevitably diminishes trust.
  • THE banking industry is only one example of what amounts to a broad agenda, promoted by some politicians and theoreticians on the right, to undermine the role of trust in our economy. This movement promotes policies based on the view that trust should never be relied on as motivation, for any kind of behavior, in any context. Incentives, in this scheme, are all that matter.
  • This cascade of trust destruction was unrelenting. One of the reasons that the bubble’s bursting in 2007 led to such an enormous crisis was that no bank could trust another. Each bank knew the shenanigans it had been engaged in — the movement of liabilities off its balance sheets, the predatory and reckless lending — and so knew that it could not trust any other bank
  • bankers used their political influence to eviscerate regulations and install regulators who didn’t believe in them. Officials and academics assured lawmakers and the public that banks could self-regulate. But it all turned out to be a scam. We had created a system of rewards that encouraged shortsighted behavior and excessive risk-taking. In fact, we had entered an era in which moral values were given short shrift and trust itself was discounted.
  • Things didn’t turn out well for our economy or our society. As millions lost their homes during and after the crisis, median wealth declined nearly 40 percent in three years. Banks would have done badly, too, were it not for the Bush-Obama mega-bailouts.
  • So C.E.O.’s must be given stock options to induce them to work hard. I find this puzzling: If a firm pays someone $10 million to run a company, he should give his all to ensure its success. He shouldn’t do so only if he is promised a big chunk of any increase in the company’s stock market value
  • Similarly, teachers must be given incentive pay to induce them to exert themselves. But teachers already work hard for low wages because they are dedicated to improving the lives of their students. Do we really believe that giving them $50 more, or even $500 more, as incentive pay will induce them to work harder? What we should do is increase teacher salaries generally because we recognize the value of their contributions and trust in their professionalism. According to the advocates of an incentive-based culture, though, this would be akin to giving something for nothing.
  • Of course, incentives are an important component of human behavior. But the incentive movement has made them into a sort of religion, blind to all the other factors — social ties, moral impulses, compassion — that influence our conduct.
  • This is not just a coldhearted vision of human nature. It is also implausible. It is simply impossible to pay for trust every time it is required. Without trust, life would be absurdly expensive; good information would be nearly unobtainable; fraud would be even more rampant than it is; and transaction and litigation costs would soar.
  • When 1 percent of the population takes home more than 22 percent of the country’s income — and 95 percent of the increase in income in the post-crisis recovery — some pretty basic things are at stake. Reasonable people, even those ignorant of the maze of unfair policies that created this reality, can look at this absurd distribution and be pretty certain that the game is rigged.
  • Trust between individuals is usually reciprocal. But if I think that you are cheating me, it is more likely that I will retaliate, and try to cheat you. (These notions have been well developed in a branch of economics called the “theory of repeated games.”) When Americans see a tax system that taxes the wealthiest at a fraction of what they pay, they feel that they are fools to play along.
  • a deeper rot takes hold: Attitudes and norms begin to change. When no one is trustworthy, it will be only fools who trust. The concept of fairness itself is eroded. A study published last year by the National Academy of Sciences suggests that the upper classes are more likely to engage in what has traditionally been considered unethical behavior. Perhaps this is the only way for some to reconcile their worldview with their outlandish financial success, often achieved through actions that reveal a kind of moral deprivation.
  • As always, it is the poor and the unconnected who suffer most from this, and who are the most repeatedly deceived. Nowhere was this more evident than in the foreclosure crisis.
  • The banks figured out how to get court affidavits signed by the thousands (in what came to be called robo-signing), certifying that they had examined their records and that these particular individuals owed money — and so should be booted out of their homes. The banks were lying on a grand scale, but they knew that if they didn’t get caught, they would walk off with huge profits, their officials’ pockets stuffed with bonuses. And if they did get caught, their shareholders would be left paying the tab
  • But perhaps even more than opportunity, Americans cherish equality before the law. Here, inequality has infected the heart of our ideals.
  • I suspect there is only one way to really get trust back. We need to pass strong regulations, embodying norms of good behavior, and appoint bold regulators to enforce them.
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Why Trump's Closing Argument on Coronavirus Clashes with Science and Voters - The New Y... - 0 views

www.nytimes.com/...trump-coronavirus.html politics US trump election biden
shared by yehbru on 29 Oct 20 - No Cached
  • As an immense new surge in coronavirus cases sweeps the country, President Trump is closing his re-election campaign by pleading with voters to ignore the evidence of a calamity unfolding before their eyes and trust his word that the disease is already disappearing as a threat to their personal health and economic well being.
  • The president has continued to declare before large and largely maskless crowds that the virus is vanishing, even as case counts soar, fatalities climb, the stock market dips and a fresh outbreak grips the staff of Vice President Mike Pence
  • Mr. Trump has attacked Democratic governors and other local officials for keeping public-health restrictions in place, denouncing them as needless restraints on the economy
  • ...14 more annotations...
  • Earlier the same day, Mr. Trump ridiculed the notion that the virus was spreading rapidly again, falsely telling a crowd in Lansing, Mich., that the reported “spike in cases” was merely a reflection of increased testing
  • His determination to brush aside the ongoing crisis as a campaign issue has become the defining choice of his bid for a second term and the core of his message throughout the campaign’s endgame.
  • a Marquette University Law School poll published Wednesday showed that 58 percent of voters there disapproved of the president’s handling of the pandemic. Mr. Biden was leading Mr. Trump in the crucial state by five percentage points.
  • The country has reported more than 8.8 million cases of the coronavirus, including a 39 percent increase in new cases over the last 14 days.
  • More than 227,000 Americans have perished from the disease.
  • There is considerable evidence it is not working. The stock market, long the focal point of Mr. Trump’s cheerleading efforts, plunged by more than 900 points on Wednesday, suffering its worst drop in months as investors grappled with the mounting disruptions wrought by the pandemic. Polling and interviews with voters show that most are not inclined to trust Mr. Trump’s sunny forecast.
  • Last week, she was dismayed to see that Mr. Trump was holding a rally in her area, because it had the potential to help spread the disease
  • A national poll published recently by The Times found that nearly two in five voters agreed with Mr. Trump that the worst of the crisis was over
  • In the same Times survey, most voters said that the worst of the pandemic was still ahead, including half of independent voters and a fifth of Republicans. By a 12-point margin, voters said they preferred Mr. Biden to lead the response to the pandemic rather than Mr. Trump. And 59 percent of voters said they favored a national mask mandate, including majorities of Democratic and independent voters, and three in 10 Republicans.
  • Mr. Biden, 77, has kept a strictly limited campaign schedule, holding no large rallies and traveling far less frequently than a typical presidential nominee.
  • “Yes, we’re getting more cases identified, but the cases are actually going up,” Admiral Giroir said, urging Americans to wear masks and avoid clustering indoors
  • “not going to control the pandemic” — a remark Mr. Biden brandished as confirmation that Mr. Trump was capitulating.
  • In Wisconsin, where new cases have skyrocketed by 46 percent in the last two weeks, Mike Mitchell, a retail manager who backs Mr. Trump, blamed out-of-town visitors for the uptick in his area
  • I may not agree with the way he tweets and everything else, but he’s turned this country around, and he’ll do it again,” said Mr. D’Amato, 71, who wore a mask to vote near downtown Fort Myers last week.
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New audio tapes show how Trump bet against science - CNNPolitics - 0 views

www.cnn.com/...index.html
shared by dytonka on 30 Oct 20 - No Cached
  • Dark warnings by scientists and new data showing a nationwide explosion in a virus Trump says is going away, crashing stock markets and real-time examples of the White House's delusions about its failed response are consuming the President as tens of millions of early voters cast judgment.
  • The economy grew at a record annualized rate of 33.1% between July and September and was up 7.4% quarter on quarter.
  • With more than 75 million votes already cast -- one-third of registered voters -- the chance for a late change to the race is limited, even as the President tried to shore up his far Western power base with rallies in Arizona, a state that could help Biden block his route to 270 electoral votes.
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Why Democrats' tax plans are such a mess | The Economist - 0 views

www.economist.com/...rats-tax-plans-are-such-a-mess politics policy economics
shared by woodlu on 29 Oct 21 - No Cached
  • 0E BIDEN promised to pay for his big social-spending proposals by raising taxes on the rich and nobody else.
  • Now Democrats are rushing to find a big pot of money without raising headline rates of tax at all.
  • predicting that they would soon reach a compromise on a social-spending bill that would pass in both the House of Representatives and the Senate, where they cannot afford a single dissenting vote in their ranks.
  • ...27 more annotations...
  • Kyrsten Sinema of Arizona,
  • satisfy two centrists:
  • Joe Manchin of West Virginia
  • desire for higher tax revenues without higher tax rates has left Democrats scrambling to make deep changes to how some levies work
  • new minimum tax on the biggest corporations’ accounting profits, which can exceed those declared to the tax authorities.
  • is a levy on
  • firms that buy back their own stock, a longtime bugbear on the left
  • a reform to the federal capital-gains tax that is designed to ensnare the ultra-rich. It would tax them annually on the paper gains of their investment portfolios, rather than when assets are sold, as under the current system
  • firms could avoid the tax attached to them by paying dividends instead.
  • no sound economic reason for penalising share buy-backs
  • A tax on the book profits of companies would outsource tax rules to unaccountable accounting bodies, reduce the efficacy of desirable tax deductions for investment and, by interfering with the ability to carry forward losses, play havoc with firms whose profits are volatile.
  • The “mark-to-market” capital gains tax is a messy attempt to rapidly extract enormous amounts from a tiny number of the very rich
  • proposal which is even more poorly designed, and which Mr Manchin is right to oppose
  • That would ultimately be bad for investment and the incentive to innovate, and would get in the way of the widespread ownership of equities.
  • straightforward result of their fragile control of Congress and the idiosyncrasies of two of their senators
  • failed to bring in straightforward reforms that raise revenue by enlarging the tax base
  • abolishing the egregious exemption that resets accrued capital gains to zero when owners die and pass on their estates.
  • Taxing capital gains at death, as Mr Biden first proposed, would raise more than $200bn over a decade—not far off the “several hundred billion” Democrats say the tax on investment portfolios would yield
  • lobbyists defeated the idea
  • also preserved the carried-interest loophole, which lets investment managers class their fees as lightly taxed capital gains, not income.
  • lifting the cap on an exemption from federally taxable income of money used to pay state and local taxes. Doing that would benefit the wealthy, narrow the tax base and subsidise high-tax states.
  • Mr Biden ignored the example of Europe. Its social spending is funded using broad-based and efficient taxes, most notably value-added tax, a levy on consumption
  • unfriendly to economic growth to begin with. Narrowing the target further—the capital-gains reform would apply only to billionaires and those with more than $100m in annual income sustained over three years
  • this tax would apply only to securities traded on public markets, with different rules for stakes in privately held firms, it would deter entrepreneurs from floating their companies on the stock exchange.
  • Democrats have pretended that raising taxes on businesses would have no negative effect on wages, contrary to the overwhelming consensus among economists.
  • The failure to agree on a tax plan carries echoes of doomed Republican attempts, under Donald Trump, to “repeal and replace” the Obamacare health-insurance system.
  • Democrats will have to confront the fact that permanently expanding the welfare state without damaging the economy means winning an argument for higher taxes, rather than always telling voters that some rich person will pay.
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Russia is becoming increasingly dependent on China - The Washington Post - 0 views

www.washingtonpost.com/...alance-putin-xi-junior-partner russia china
shared by Javier E on 12 Aug 22 - No Cached
  • A few weeks before Russia launched its war, Putin and Xi met at a summit and declared a partnership with “no limits.” Now, after a summer of spiraling tensions, their governments are locked in a tighter embrace, voicing their shared animus toward the American hegemon that looms over their own perceived spheres of influence.
  • This week, Zhang Hanhui, China’s ambassador to Moscow, attacked the United States for supposedly stoking the conflict in Ukraine. “As the initiator and main instigator of the Ukrainian crisis, Washington, while imposing unprecedented comprehensive sanctions on Russia, continues to supply arms and military equipment to Ukraine,” Zhang told Russian state news agency Tass. “Their ultimate goal is to exhaust and crush Russia with a protracted war and the cudgel of sanctions.”
  • Earlier, Dmitry Peskov, Putin’s press secretary, had lambasted Washington for House Speaker Nancy Pelosi’s controversial visit to Taiwan. “This is not a line aimed at supporting freedom and democracy,” Peskov said. “This is pure provocation. It’s necessary to call such steps what they really are.”
  • ...8 more annotations...
  • Putin may be possessed by neo-imperial dreams of Russia’s place in Europe, but he is presiding over a state of affairs that has steadily given Beijing more leverage over Moscow. Far removed from the days of the Cold War when the Kremlin viewed communist China as its “poorer cousin,” Russia — isolated and enfeebled — is sliding inexorably into the role of “junior partner” to the Asian giant.
  • The war in Ukraine has rendered Russia increasingly dependent on China: Sanctions have curtailed the global market for its exports and thinned out possible suppliers for its exports. Enter China, whose imports from Russia have surged, jumping 80 percent in May compared with last year, largely in the form of oil and other natural resources. The Russian market, left bereft of many European products, may get all the more flooded by Chinese goods and technology in the months and even years ahead.
  • Gabuev suggested that current trendlines could see China’s renminbi, which has already outperformed the euro on Moscow’s stock exchange, becoming “the de facto reserve currency for Russia even without being fully convertible,” and thereby “increasing Moscow’s dependence on Beijing.”
  • Imbalances that already existed between both countries are only amplifying. China is edging closer to Russia as a leading arms supplier to developing countries. Russia was compelled to significantly discount oil sales to China, while Chinese car manufacturers — recognizing the paucity of options now facing Russian consumers — have in some instances raised prices for their vehicles in Russia by 50 percent
  • Gabuev unpacked the geopolitical ramifications of Russia’s supplication to China. “To keep China happy, Russian leaders will have little choice but to accept unfavorable terms in commercial negotiations, to support Chinese positions in international forums such as the United Nations, and even to curtail Moscow’s relations with other countries, such as India and Vietnam,”
  • Even in the remote scenario where Putin himself falls, it’s hard to imagine the broader tectonic realignments taking place would shift all that much. “Russia is turning into a giant Eurasian Iran: fairly isolated, with a smaller and more technologically backward economy thanks to its hostilities to the West but still too big and too important to be considered irrelevant,
  • With China as Russia’s biggest external partner and major diplomatic ally, Gabuev concluded, “the aging ruling elite in the Kremlin, myopically fixated on Washington, will be even more eager to serve as China’s handmaidens as it rises to become the archrival of the United States.”
  • “The best way for the West to deal with the China-Russia alignment is to acknowledge that these bonds are strong and to improve its own resilience and deterrence capacities,” wrote Justyna Szczudlik, a China analyst at the Polish Institute of International Affairs.
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He Turned 55. Then He Started the World's Most Important Company. - WSJ - 0 views

www.wsj.com/...hips-entrepreneurship-506fcbc4 entrepreneur chip company Taiwan
shared by Javier E on 10 Apr 24 - No Cached
  • You probably use a device with a chip made by TSMC every day, but TSMC does not actually design or market those chips. That would have sounded completely absurd before the existence of TSMC. Back then, companies designed chips that they manufactured themselves. Chang’s radical idea for a great semiconductor company was one that would exclusively manufacture chips that its customers designed. By not designing or selling its own chips, TSMC never competed with its own clients. In exchange, they wouldn’t have to bother running their own fabrication plants, or fabs, the expensive and dizzyingly sophisticated facilities where circuits are carved on silicon wafers.
  • The innovative business model behind his chip foundry would transform the industry and make TSMC indispensable to the global economy. Now it’s the company that Americans rely on the most but know the least about
  • I wanted to know more about his decision to start a new company when he could have stopped working altogether. What I discovered was that his age was one of his assets. Only someone with his experience and expertise could have possibly executed his plan for TSMC. 
  • ...30 more annotations...
  • “I could not have done it sooner,” he says. “I don’t think anybody could have done it sooner. Because I was the first one.” 
  • By the late 1960s, he was managing TI’s integrated-circuit division. Before long, he was running the entire semiconductor group. 
  • He transferred to the Massachusetts Institute of Technology, where he studied mechanical engineering, earned his master’s degree and would have stayed for his Ph.D. if he hadn’t failed the qualifying exam. Instead, he got his first job in semiconductors and moved to Texas Instruments in 1958
  • he came along as the integrated circuit was being invented, and his timing couldn’t have been any better, as Chang belonged to the first generation of semiconductor geeks. He developed a reputation as a tenacious manager who could wring every possible improvement out of production lines, which put his career on the fast track.
  • Chang grew up dreaming of being a writer—a novelist, maybe a journalist—and he planned to major in English literature at Harvard University. But after his freshman year, he decided that what he actually wanted was a good job
  • “They talk about life-work balance,” he says. “That’s a term I didn’t even know when I was their age. Work-life balance. When I was their age, if there was no work, there was no life.” 
  • These days, TSMC is investing $40 billion to build plants in Arizona, but the project has been stymied by delays, setbacks and labor shortages, and Chang told me that some of TSMC’s young employees in the U.S. have attitudes toward work that he struggles to understand. 
  • Chang says he wouldn’t have taken the risk of moving to Taiwan if he weren’t financially secure. In fact, he didn’t take that same risk the first time he could have.
  • “The closer the industry match,” they wrote, “the greater the success rate.” 
  • By then, Chang knew that he wasn’t long for Texas Instruments. But his stock options hadn’t vested, so he turned down the invitation to Taiwan. “I was not financially secure yet,” he says. “I was never after great wealth. I was only after financial security.” For this corporate executive in the middle of the 1980s, financial security equated to $200,000 a year. “After tax, of course,” he says. 
  • Chang’s situation had changed by the time Li called again three years later. He’d exercised a few million dollars of stock options and bought tax-exempt municipal bonds that paid enough for him to be financially secure by his living standards. Once he’d achieved that goal, he was ready to pursue another one. 
  • “There was no certainty at all that Taiwan would give me the chance to build a great semiconductor company, but the possibility existed, and it was the only possibility for me,” Chang says. “That’s why I went to Taiwan.” 
  • Not long ago, a team of economists investigated whether older entrepreneurs are more successful than younger ones. By scrutinizing Census Bureau records and freshly available Internal Revenue Service data, they were able to identify 2.7 million founders in the U.S. who started companies between 2007 and 2014. Then they looked at their ages.
  • The average age of those entrepreneurs at the founding of their companies was 41.9. For the fastest-growing companies, that number was 45. The economists also determined that 50-year-old founders were almost twice as likely to achieve major success as 30-year-old founders, while the founders with the lowest chance of success were the ones in their early 20s
  • “Successful entrepreneurs are middle-aged, not young,” they wrote in their 2020 paper.  
  • Silicon Valley’s venture capitalists throw money at talented young entrepreneurs in the hopes they will start the next trillion-dollar company. They have plentiful energy, insatiable ambition and the vision to peek around corners and see the future. What they don’t typically have are mortgages, family obligations and other adult responsibilities to distract them or diminish their appetite for risk. Chang himself says that younger people are more innovative when it comes to science and technical subjects. 
  • But in business, older is better. Entrepreneurs in their 40s and 50s may not have the exuberance to believe they will change the world, but they have the experience to know how they actually can. Some need years of specialized training before they can start a company. In biotechnology, for example, founders are more likely to be college professors than college dropouts. Others require the lessons and connections they accumulate over the course of their careers. 
  • one more finding from their study of U.S. companies that helps explain the success of a chip maker in Taiwan. It was that prior employment in the area of their startups—both the general sector and specific industry—predicted “a vastly higher probability” of success.
  • Chang was such a workaholic that he made sales calls on his honeymoon and had no patience for those who didn’t share his drive
  • Morris Chang had 30 years of experience in his industry when he decided to uproot his life and move to another continent. He knew more about semiconductors than just about anyone on earth—and certainly more than anyone in Taiwan. As soon as he started his job at the Industrial Technology Research Institute, Chang was summoned to K.T. Li’s office and given a second job. “He felt I should start a semiconductor company in Taiwan,”
  • “I decided right away that this could not be the kind of great company that I wanted to build at either Texas Instruments or General Instrument,”
  • TI handled every part of chip production, but what worked in Texas would not translate to Taiwan. The only way that he could build a great company in his new home was to make a new sort of company altogether, one with a business model that would exploit the country’s strengths and mitigate its many weaknesses.
  • Chang determined that Taiwan had precisely one strength in the chip supply chain. The research firm that he was now running had been experimenting with semiconductors for the previous 10 years. When he studied that decade of data, Chang was pleasantly surprised by Taiwan’s yields, the percentage of working chips on silicon wafers. They were almost twice as high in Taiwan as they were in the U.S., he said. 
  • “People were ingrained in thinking the secret sauce of a successful semiconductor company was in the wafer fab,” Campbell told me. “The transition to the fabless semiconductor model was actually pretty obvious when you thought about it. But it was so against the prevailing wisdom that many people didn’t think about it.” 
  • Taiwan’s government took a 48% stake, with the rest of the funding coming from the Dutch electronics giant Philips and Taiwan’s private sector, but Chang was the driving force behind the company. The insight to build TSMC around such an unconventional business model was born from his experience, contacts and expertise. He understood his industry deeply enough to disrupt it. 
  • “TSMC was a business-model innovation,” Chang says. “For innovations of that kind, I think people of a more advanced age are perhaps even more capable than people of a younger age.”
  • the personal philosophy that he’d developed over the course of his long career. “To be a partner to our customers,” he says. That founding principle from 1987 is the bedrock of the foundry business to this day, as TSMC says the key to its success has always been enabling the success of its customers.  
  • TSMC manufactures chips in iPhones, iPads and Mac computers for Apple, which manufactures a quarter of TSMC’s net revenue. Nvidia is often called a chip maker, which is curious, because it doesn’t make chips. TSMC does. 
  • Churning out identical copies of a single chip for an iPhone requires one TSMC fab to produce more than a quintillion transistors—that is, one million trillions—every few months. In a year, the entire semiconductor industry produces “more transistors than the combined quantity of all goods produced by all other companies, in all other industries, in all human history,” Miller writes. 
  • I asked how he thought about success when he moved to Taiwan. “The highest degree of success in 1985, according to me, was to build a great company. A lower degree of success was at least to do something that I liked to do and I wanted to do,” he says. “I happened to achieve the highest degree of success that I had in mind.” 
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Global Malaise Spurs U.S. Growth Worries - WSJ - 0 views

www.wsj.com/...-u-s-growth-worries-1452819336 u s growth economics
shared by zachcutler on 15 Jan 16 - No Cached
  • Concerns are mounting over whether the U.S. economy and financial markets can remain upright while so much of the world teeters.
  • Falling oil prices and worries about China’s economy have walloped stock markets, leading to a volatile start to the year.
  • Market volatility has heightened the stakes for Federal Reserve officials, who are expected to keep interest rates unchanged at a meeting later this month.
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  • Forecasters in The Wall Street Journal’s latest survey of economists said there is a 17% chance the U.S. will enter a recession in 2016,
  • Many investors have alternately feared the U.S. would succumb to global weakness or latched onto signs it would muddle through.
  • “I find it hard to believe that a quarter-point rate hike has created all this enormous uncertainty,” said Timothy Adams, head of the Institute of International Finance, a trade group representing financial institutions.
  • One reason economists aren’t even more worried: The U.S. relies less on trade than many of the world’s largest nations.
  • Still, the U.S. has more than 100 million people working in service industries—primarily transacting with other U.S. businesses and individuals
  • Some industries are sure to be hit harder than others if the global economy slows. Durable-goods makers
  • They forecast payroll growth falling from about 202,000 in the first three months of 2016 to 180,000 in the last three months
  • Little is known about how much emerging-market risk U.S. investors hold,” said Daniel Bachman, senior U.S. economist at Deloitte Services LP.
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This Time Really Is Different - The New York Times - 0 views

www.nytimes.com/...avirus-pandemic-different.html pandemic effect trump
shared by Javier E on 15 Mar 20 - No Cached
  • “This time is different.” People always say that as markets spiral, but time usually proves them wrong
  • “We’ve seen it over the centuries,” said Kenneth Rogoff, a Harvard economist who actually wrote the book on this — he’s a co-author of “This Time Is Different: Eight Centuries of Financial Folly.”
  • yet Professor Rogoff told me this week that, in some ways, the crisis of 2020 might really be unique.
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  • It helps, a little, to think in meteorological terms. View it as a major hurricane — one that still appears to be gathering force.
  • With a decline in American stocks of more than 20 percent from their peak, the 11-year American bull market died on Wednesday.
  • All on its own, that would be monumental. So would the virtual halt of major sporting events, the cancellation of conferences and the banning of flights, to say nothing of the great diaspora of office workers who have been sent home
  • Yet even these developments seem trivial in the face of the rising death toll, with mind-boggling predictions of millions of additional infections
  • There is no shortage of solid suggestions. Providing paid sick leave and medical coverage to those who don’t have it, strengthening unemployment insurance “and generally repairing the frayed social safety net in the United States” are useful options,
  • Professor Rogoff estimates that a global recession is “at least 80 percent likely,” with China bearing much of the brunt and other emerging-market countries likely to be severely pounded.
  • “the financial power of the United States has grown in stature since the 2007-2009 financial crisis.”
  • That power would be wasted, Professor Rogoff said, if the United States did not use its resources both to aid other nations and provide succor to the impoverished people within its own borders.
  • some officials and scholars are contemplating even more radical experiments than the banks have engaged in over the last decade, like buying corporate debt in the United States or even issuing digital money that would pay variable interest rates, targeted to the borrower.
  • Whether this event really turns out to be a storm from which the economy rebounds, or a cataclysm that wreaks far more consequential changes, cannot be easily answered.
  • the most important boon to the economy might come from something simpler: a general conviction that government, businesses, nonprofits and individuals are responding effectively, and that a semblance of normal life will soon resume.
  • But the epidemic’s relentless math, and the bumbling start to the recovery effort in the United States, suggest that we won’t be close to that moment for many weeks.
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