washingtonpost--2020-02-26--Analysis | Hong Kong Shifts Aim From the Virus to Property

The centerpiece of Financial Secretary Paul Chan ’ s antidote is a HK $ 10,000 cash handout to all adult permanent residents .
Additionally , Hong Kong will offer bigger income and profit tax rebates , and provide subsidies on utility bills as well as government guaranteed low-interest loans to small- and medium-size businesses .
From cancelled orders and stuck payments to inventory pileups , SMEs may be worst-affected by the outbreak .
Supporting them is necessary .
But how reasonable is a handout for all ?
The S $ 6.4 billion ( $ 4.6 billion ) anti-viral budget recently @ @ @ @ @ @ @ component .
But for high-income earners and property owners without young children , it comes to just S $ 100 — less than HK $ 600 .
Although the needy and elderly will get more , the bulk of Singapore ’ s extra spending will support firms and shore up health expenditure .
Hong Kong , however , seems to be using the virus as an excuse to splash money : Almost 60 % of its stimulus package is doing just that .
The headline figures could be deceptive , though , considering @ @ @ @ @ @ @ was largely a meaningless number .
It included money set aside for a HK $ 30 billion anti-epidemic fund , which will only be used next fiscal year to give a one-time special allowance to low-income households and subsidies for students .
Strip that out , and Hong Kong ’ s first budget shortfall in 15 years was basically an optical illusion .
Next year may be the same story .
The four rounds of relief measures the city has announced since August to offset some of the economic impact of anti-government protests @ @ @ @ @ @ @ ’ s pockets .
Soon the additional HK $ 10,000 checks will hit their bank accounts .
If the virus gets contained in a few months , those with secure jobs may be encouraged to use the windfall to put a step on the city ’ s impossibly expensive property ladder .
And even if the monetary incentive is too small for them to do that , their landlords will know that they can ask for higher rents since every family of two permanent resident adults and their two school-going children will be @ @ @ @ @ @ @ in cash from the government and paying slightly lower taxes .
Stable rental yield on existing properties will support new real-estate launches .
What the government earns from stamp duties — some of which are meant to keep housing prices in check — will rise .
So will revenue from land sales to developers , especially when the city with some of the world ’ s least-affordable real estate starts hawking parcels under the controversial Lantau Tomorrow program .
The 4.8 % deficit could end up much lower , but long-term public finances @ @ @ @ @ @ @ property prices .
It ’ s a dangerous addiction .
In the first five years of the millennium , revenue from land premium and stamp duty together accounted for 13 % of government revenue .
Now they bring in a third .
Profit tax still remains the single-biggest individual contributor , but even here there ’ s little broadening of the base .
Property , investment , banking and finance , wholesale trade and import and export account for two-thirds of profit tax collections ; nine out of 10 companies in Hong Kong @ @ @ @ @ @ @ employed worker shells out some income taxes , though with the 100 % relief that Chan has announced ( with the reduction capped at HK $ 20,000 ) , even the base of the salary tax pyramid will become narrower .
Hong Kong doesn ’ t have Singapore ’ s consumption tax , or casino earnings .
Singapore ’ s sovereign wealth fund and state investment arm are now the No .
1 contributor to its budget , whereas investment income has become a negligible part of Hong Kong ’ s public revenue @ @ @ @ @ @ @ funding constraints , Hong Kong needs to be more prudent than to splurge indiscriminately .
The cash it ’ s throwing around isn ’ t a protection against coronavirus .
It will only stimulate what doesn ’ t need any more encouragement : the property market .


washingtonpost--2020-02-27--Analysis | Trump’s ‘Totally Prepared’ Coronavirus Pledge Will Be Put to the Test

Against that backdrop , the president ’ s instinct to downplay the threat — even if the experts with him were more sobering — and his willingness to exchange potshots with political rivals such as Democratic House Speaker Nancy Pelosi are especially troublesome .
He at least acknowledged at the briefing that the risk of the virus could escalate , which is an improvement , and his decision to put Vice President Mike Pence in charge of the response may make things less chaotic .
But modestly improved rhetoric and a new virus czar are a pretty long way off @ @ @ @ @ @ @ assembled officials did some things right at the briefing .
They encouraged people to take steps that might prevent the spread of the virus , such as washing hands and staying home when ill .
These efforts may not seem important , but they genuinely do reduce the spread of viruses , and the fact that the president encouraged those measures is significant .
The possibility of quarantines was acknowledged , as was the need to financially and logistically support state and local responses to any uptick in infections .
But specifics on @ @ @ @ @ @ @ reasons White House and Congressional estimates of needed emergency funding are so far apart , and the possible need for further travel bans were all conspicuously absent .
If Pence wants to prove he ’ s up to the job of leading the response , providing more detail on these crucial issues should be a priority .
Meanwhile , even as Trump described the potential breadth of actions underway , he appeared to underplay the urgency .
“ We do have plans on a much larger scale , ” he said .
“ @ @ @ @ @ @ @ ll need it.
” Trump ’ s seeming preference to minimize the threat of the virus also reared its head with his repeated emphasis that there were just 15 confirmed cases in the U.S. , not counting repatriated Americans .
He attributed this to his rapid decision to ban travelers from China .
But another culprit is that America has been extremely slow to test broadly for the disease due to limited capacity and narrow CDC guidelines .
As the recently disclosed mystery case makes it clear , the administration won ’ t @ @ @ @ @ @ @ broadly or be able to respond appropriately until America tests far more broadly .
Wednesday ’ s press conference was the president ’ s attempt to calm markets and the country , but the virus is unlikely to cooperate .
The administration will have to replace words with palpable action .

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washingtonpost--2020-02-27--Analysis | Utilities Are Priced for Pandemic, Er, Perfection

What the utilities do have going for them right now is the thing afflicting most everyone else : fear of a pandemic .
Wednesday marked a watershed in the energy world , with utilities ’ weighting in the S & P 500 rising above that of the energy ( or oil and gas ) sector for the first time ever .
Leave aside things like energy transition and climate change , and this dichotomy explains a lot .
Oil and gas is a cyclical , global business where China looms disproportionately large , and the oil price is a go-to @ @ @ @ @ @ @ in the center of global demand growth is about as bad as it gets for oil — and it ’ s also not great for a host of other sectors relying on global markets and supply chains , tech included .
Utilities are the opposite of this .
They are overwhelmingly domestic , with wires strung above and pipes laid below American streets .
Demand for their products isn ’ t likely to be affected too much whether people are commuting or staying home .
More importantly , demand doesn ’ t drive @ @ @ @ @ @ @ an allowed return on investment .
This is why energy stocks now yield almost 5 % and utilities less than 3 % .
The majors are being penalized for spending money , while utilities are rewarded for doing just that .
It isn ’ t the promise of high growth pushing utilities higher ; it ’ s more the sense their earnings will be resilient to whatever is coming on the coronavirus front .
For example , we are yet to see what happens when a major outbreak is confirmed within the U.S @ @ @ @ @ @ @ this year , but it has been there since late 2018 .
That was when the market sold off heavily on concerns about excessive tightening by the Federal Reserve .
Then 2019 saw the interplay of fears about a trade war and the Fed ’ s pivot , first toward holding off on further interest-rate hikes and then to outright easing .
Like the coronavirus , this backdrop of turmoil centered on international business activity played to utilities ’ strengths .
The added twist is that utilities ’ regulated earnings and high payouts @ @ @ @ @ @ @ as bond proxies .
Greg Gordon , an analyst at Evercore ISI , tracks the relationship between utility dividend yields and the yield on a Moody ’ s Corp. index of triple-B-rated corporate debt .
As corporate bond yields feel the gravitational pull of a sinking 10-year Treasury yield — cut in half since the start of 2019 to today ’ s 1.34 % — so utility yields have also reset lower and lower : This presents a conundrum .
On one hand , utility valuations clearly look stretched .
Their premium to @ @ @ @ @ @ @ high , and they also trade significantly above another defensive sector , healthcare .
And yet the spread between utility dividend yields and corporate bond yields has narrowed to less than 60 basis points , roughly half the average of the past decade .
That leaves little room for utility yields to rise without breaching the long-established relationship with the bond index .
The latter , meanwhile , is being held down by those record low Treasury yields ; and what with pandemic fears and an oncoming election , it is hard to @ @ @ @ @ @ @ appreciably .
One risk is that the fear that has crept into high-yield bonds seeps up into the higher-rated end of the market .
That would loosen the grip of investment grade yields ( hardly bargains themselves ) on Treasuries , meaning wider spreads — and ultimately higher dividend yields and lower prices for utility stocks .
It would be correct to say utilities are priced for something like perfection .
In the current context , though , “ perfection ” means something pretty awful .


washingtonpost--2020-06-14--Analysis | Iran’s Coronavirus Fight Collides With U.S. Sanctions

It ’ s now clear that by the time the government made public Iran ’ s first virus deaths in Qom on Feb. 19 , the disease had been filling hospital beds for weeks .
The government hesitated to quarantine the city , home to the nation ’ s largest theological seminary , describing such a step as “ medieval.
” It was also slow to halt flights from China , its main economic and geopolitical partner , and to close holy sites such as Qom ’ s shrine of Fatima Masumeh , from which Shiite pilgrims carried the virus @ @ @ @ @ @ @ movement restrictions , it was quick to allow people to return to work , in April , which may have contributed to the rebound in infections .
By June Iran was reporting record daily numbers of new cases .
The pandemic struck after a series of missteps had already shaken confidence in the government and its security pillar , the Islamic Revolutionary Guard Corps .
In November , as U.S. sanctions reduced Iranian oil revenues to a trickle , the government slashed fuel subsidies , prompting protests that it suppressed at the cost @ @ @ @ @ @ @ at least 304 lives .
In January , the U.S. killed Iran ’ s most powerful military general , Qassem Soleimani , in a targeted drone strike in Iraq .
The surge of national unity that followed was cut short when authorities initially sought to cover up the IRGC ’ s mistaken shooting-down of a civilian airliner on Jan. 8 .
With trust in government at an all-time low , millions boycotted parliamentary elections in February , and ignored directives not to travel during the Persian New Year , in late March .
@ @ @ @ @ @ @ .
As with China , Iran ’ s figures suggest the country of about 83 million brought a rampant outbreak under control .
It was quick to boast of success relative to richer countries .
But that was before the second surge of infections , which took Iran ’ s official totals of cases and deaths to 187,427 and 8,837 respectively , by June 14 .
At the same time , Iran ’ s data may be even less accurate than elsewhere .
Low testing rates mean the Tehran government has likely understated @ @ @ @ @ @ @ figures in mid-March , after hard-hit areas posted numbers that were multiples of official data .
Media interviews with doctors and nurses , including by Bloomberg , and an Iranian parliament report suggest systematic misdiagnosis and under-reporting of deaths .
After two years of U.S. President Donald Trump ’ s “ Maximum Pressure ” campaign , following on earlier sanctions , Iran entered the virus crisis with 41 % inflation , rising unemployment and an economy estimated by the International Monetary Fund to have shrunk by 5.4 % in 2018 and a further @ @ @ @ @ @ @ exports , Iran ’ s biggest source of foreign exchange , are about 7 % of their level just before the U.S. withdrew from a multilateral nuclear agreement in May 2018 .
Under that accord , reached in 2015 , Iran forfeited some 97 % of its enriched uranium , which if processed further could fuel a nuclear weapon , and mothballed some three-quarters of the centrifuges needed to refine the heavy metal .
The Trump administration says its sanctions aim to pressure Iran ’ s leadership into abandoning its nuclear program , @ @ @ @ @ @ @ such as Hezbollah and halting the development of ballistic missiles .
U.S. sanctions mean the country is now largely cut off from the international financial system and has little foreign currency to purchase imports , including medical supplies .
Where other nations borrowed or dug into reserves to cushion the impact , Iran had little capacity to do either .
Despite exceptions to U.S. sanctions for food , medicines and medical equipment , the U.S. government has frequently warned businesses and banks to avoid any trade with Iran , making it difficult for @ @ @ @ @ @ @ U.S. leverage rests with the central role American banks , and the U.S. dollar , play in the global economy .
Anyone violating the sanctions could see their U.S.-based assets blocked or lose the ability to move money via the U.S. banking system .
There ’ s no sign of this so far , with both sides using the crisis to pursue geopolitical advantage .
The U.S. blocked Iran ’ s request for a $ 5 billion IMF loan , the first Iranian application since 1960 .
Although the U.S. offered Iran “ @ @ @ @ @ @ @ Ali Khamenei refused it , citing Iran ’ s lack of trust in the leadership in Washington .
Iran sought to pin blame for the virus on the U.S. , with Khamenei promoting a theory that the U.S. had engineered it to target people with the genetic make up of Iranians .
There ’ s little sign of that , either .
Some right-wing Washington think tanks and commentators argue the coronavirus is piling pressure on Tehran to capitulate to U.S. demands , making this the wrong time to ease sanctions .
Yet @ @ @ @ @ @ @ the IRGC and Bonyads -- charities-cum-industrial conglomerates linked to the Supreme Leader and religious bodies -- which have distributed welfare to supplement government aid .
Iran ’ s goading of Washington also continues .
In March , Iran-backed militias shelled a U.S. base in Iraq ; in April , Iranian gun boats swarmed a U.S. naval ship and coast guard cutter in the Persian Gulf ; and in May , the country launched its first military satellite with rocket technology the U.S. said could power ballistic missiles .
Iran has sought to stir @ @ @ @ @ @ @ Minister Javad Zarif slammed as “ medical terror.
” Calls for Trump to lift them have come not just from Russia , China and other Iran-friendly nations , but also former U.S. and European officials , four former NATO secretaries general , human rights groups and some lawmakers in Congress .
The Trump administration says Iran can access medicines , food and other humanitarian goods , and that it could afford more for the pandemic if it spent less on military adventures .
This remains about as contentious as ever .
Iran , @ @ @ @ @ @ @ of nuclear weapons in 1968 , insists it ’ s developing atomic technology only for non-military purposes .
The U.S. disputes that .
The IAEA said it made a record number of site visits in Iran last year , although some relating to Iran ’ s past activities were blocked .
Covid-19 has since made the process more reliant on digital monitoring .


washingtonpost--2020-06-14--College Towns Fear Covid Will Leave Them as Ghost Towns

That all dried up in March , when Lafayette and most other U.S. colleges sent students home and canceled sports for the remainder of the school year to limit contagion of the novel coronavirus .
With all but 200 of Lafayette ’ s roughly 2,650 students gone , Easton ’ s restaurants and shops never saw the influx they usually expect at Mother ’ s Day and graduation , nor from other visitors .
High school juniors toured the liberal arts college by video instead of walking through the hilly campus nestled in the Lehigh Valley .
The pain kept @ @ @ @ @ @ @ sales tax revenue for government , and then local businesses and the city of Easton began laying off and furloughing employees , hurting sales further and cutting into income tax revenue .
Lafayette announced its own furloughs of about 40 employees for June and July , in addition to some salary reductions .
Businesses that have survived aren ’ t sure how much more they can take , even though as of June 5 restaurants are allowed to resume limited outdoor service .
Davis said he is not sure whether the finances of @ @ @ @ @ @ @ half-capacity to maintain social distance .
Of course , he points out , if people can ’ t afford to go out to eat because they have lost jobs , it won ’ t be the capacity limit that breaks his business .
“ We ’ re hoping there aren ’ t significant and lasting impacts on the city , ” said Mark Eyerly , a college spokesman whose office is downtown .
“ Easton ’ s renaissance has become a key advantage for us in recruiting students and faculty to the college @ @ @ @ @ @ @ t 20 years ago.
” The school said it will announce this week that it intends to open for in-person classes from August through Thanksgiving .
However , for health reasons Lafayette will encourage students to stay on campus — which would hurt that downtown comeback .
Colleges are among the largest employers in their towns .
They helped drive economic growth for decades and were seen as stable sources of jobs .
Easton was making a comeback until the pandemic , on track to hit a population of more than 30,000 in @ @ @ @ @ @ @ first time since the 1960s .
A cluster of new restaurants , shops and housing — led by the Alehouse about 25 years ago — had revived the downtown after decades of decline .
“ Easton ’ s recent redevelopment means it has only a thin cushion to sustain its economic base against the shock of this crisis , ” said John Kincaid , a professor of government at the school since 1994 and director of the Meyner Center for the Study of State and Local Government .
Students make up only about @ @ @ @ @ @ @ .
In Chapel Hill , North Carolina , home to a big state school , students are estimated to make up a far larger share — roughly a fourth .
Economies like that are almost unimaginable without the colleges at their heart .
The losses from even the current pause have been steep .
Total small business revenue in Easton ’ s Northampton County was down about a quarter as of early June compared with January , according to the Opportunity Insights Economic Tracker , a platform that pulls together data on indicators @ @ @ @ @ @ @ from private companies to offer a real-time picture of economic activity .
In Orange County , North Carolina , home to Chapel Hill , small business revenue is down more than 20 % as of early June compared with early 2020 , far worse than the state of North Carolina ’ s roughly 5 % decline .
The University of North Carolina at Chapel Hill has said it plans to hold in-person classes this fall , with social distancing precautions .
However , the uncertainty of a pandemic — already resurging in some @ @ @ @ @ @ @ the all-important football seasons in jeopardy .
The University of Nebraska-Lincoln also has said it plans to welcome students back this fall and resume football .
The Cornhuskers hold the record from the National Collegiate Athletic Association for consecutive sold-out Saturday football games , a streak that began in 1962 and has run for 375 games so far .
The Huskers ’ venue , Memorial Stadium , swells with about 90,000 fans each time .
Each game , about half a dozen per season , brings in an economic impact of $ 5.2 @ @ @ @ @ @ @ according to Eric Thompson , a professor of economics at the University of Nebraska-Lincoln .
Forgoing more than $ 31 million from a skipped season would be devastating .


washingtonpost--2020-02-14--Analysis | What You Need to Know About the Spreading Coronavirus

It has been described as “ insidious ” because a large portion of infected people are well enough to go about their daily business , potentially spreading it to others .
As of mid-February the apparent mortality rate was about 2 % , lower than the 9.5 % rate for SARS .
But such numbers are unreliable in the early stages of an outbreak .
Some disease modeling experts project as many as hundreds of thousands of people are actually infected , most of whom won ’ t even know they have it .
One study published Feb. 10 estimated @ @ @ @ @ @ @ all cases , including those with no or only mild symptoms , are counted .
A more rigorous test for the virus produced a jump in the number of detected cases around mid-February .
The disease caused by the virus has been named Covid-19 .
Infections appear to cause a mild illness in children , adolescents and younger adults , and potentially more severe disease in older people .
Frequently reported early signs are fever , dry cough and tiredness -- but not the sneezing and runny nose typical of a cold .
@ @ @ @ @ @ @ virus invades cells in the lower respiratory tract and migrates to the lungs , causing difficulty breathing and the inflammation and congestion associated with pneumonia .
In an early study , more than a quarter of hospitalized patients developed a complication known as acute respiratory distress syndrome .
Many of the fatalities have been in patients with underlying illnesses such as cardiovascular disease .
The virus that causes Covid-19 is genetically similar to the SARS virus but appears milder in terms of illness and case fatality rate .
Another related virus , known @ @ @ @ @ @ @ spreading since 2012 has led to death in 34 % of the 2,499 cases recorded .
By contrast , an estimated 50 million people died in the 1918 influenza pandemic that had a case-fatality ratio of less than 5 % , but infected up to a third of the world ’ s population .
Most likely by coming into contact with virus-containing droplets that are emitted when an infected person breathes , talks , coughs or sneezes .
These can be transferred directly to someone else in close proximity or via hands and @ @ @ @ @ @ @ risk the virus can spread through feces or farther through the air in tiny particles known as aerosols .
People who are still incubating the virus and show no symptoms may spread it .
Epidemiologists try to gauge contagiousness by estimating the number of additional people a person who is infected is likely to infect .
That measurement , called a basic reproduction number , is one indicator of how difficult an epidemic is to control .
The World Health Organization gives a preliminary range of 1.4 to 2.5 for 2019-nCoV .
At @ @ @ @ @ @ @ similar to SARS and more infectious than flu .
A group from the Chinese Academy of Sciences in Beijing estimated the number to be 4.08 .
Coronaviruses are named for their crown-like shape .
There ’ s a large family of them , responsible for diseases that range in severity from the common cold to MERS .
Some transmit easily from person to person , while others do not .
The WHO says that new strains emerge periodically around the globe , and several known versions are circulating in animals and haven ’ @ @ @ @ @ @ @ in early December in Wuhan , an industrial city of 11 million and capital of Hubei province .
Early attention focused on a seafood market where live animals were also sold , but about a third of the first 41 cases were found to have no link to it .
The viral genome is even more closely related to several coronaviruses found in bats than it is to the SARS coronavirus .
Diseases transmissible from animals to humans , sometimes referred to as “ zoonoses , ” comprise a large percentage of all @ @ @ @ @ @ @ always concern when a new pathogen emerges in people because they typically lack immunity to it and there usually aren ’ t specific treatments or vaccines available .
Novel coronaviruses , those not seen in humans before , represent a particular concern because they have been known to spark complicated outbreaks that have sickened thousands of people , like SARS did as it swept across the globe from southern China .
Unlike SARS , relatively few cases have been reported outside mainland China .
But in Hubei , thousands of people have been @ @ @ @ @ @ @ being treated in intensive care units , creating what officials there have described as an “ extreme , severe and abrupt public health crisis.
” A Wuhan hospital saw coronavirus infections spread rapidly among health-care staff and other patients , according to a study published in the Journal of the American Medical Association .
China ’ s government imposed a quarantine on Wuhan and more than a dozen other cities in the region , a travel ban covering in excess of 50 million people .
New hospitals were built from the ground up @ @ @ @ @ @ @ medical equipment ramped up .
The WHO has declared the outbreak a global health emergency , a designation that can help mobilize international responses .
Anyone caught spreading misinformation was subject to criminal charges in some Asian countries .
Hong Kong , the international financial center that functions with some autonomy from China , announced its own travel restrictions from the mainland .
The U.S. , Australia , India and other countries are denying or restricting entry for non-citizens arriving from China in an attempt to stop the virus ’ s spread , @ @ @ @ @ @ @ unnecessary .
Early praise for China ’ s response has ebbed .
The country did not immediately release genetic information about the virus and has struggled to explain changes in the way it counts new cases .
In a nation where the internet is heavily censored , there was a rare outpouring of social media fury over the death from the virus of a Chinese doctor who had waved an early red flag about the outbreak but was silenced by police .
The top officials in Wuhan and Hubei were later removed from @ @ @


washingtonpost--2020-02-14--Wuhan Sharply Tightens Quarantines on Residents: Virus Update

Harrods Department Store Co. , a big tourist attraction in London for Chinese shoppers , has prohibited staff from wearing @ @ @ @ @ because of the “ risk of spreading further anxiety ” about the virus .
The @ @ @ @ @ that non-infected people should wear face-masks only if they ’ re caring for someone who @ @ @ @ @ advises that people who are coughing or sneezing wear face masks , as the disease @ @ @ @ @ saliva .


washingtonpost--2020-02-14--Analysis | French Giant Looks at Tesla With Burning Envy

Dwindling profits and Renault ’ s drastic remedies were mirrored this week by its Japanese alliance partner Nissan Motor Co. , as well at Daimler AG .
( Renault has an engineering partnership with Daimler and owns a small stake in the German car and truck maker . )
Their problems aren ’ t identical but all three had expanded their workforces in anticipation of demand that hasn ’ t materialized and now they have to tighten their belts to pay for expensive electric vehicles , for which demand remains uncertain .
Renault ’ s shares are near their lowest @ @ @ @ @ @ @ the company is capitalized at barely 10 billion euros ( $ 11 billion ) , a sum that includes the 43 % stake Renault owns in Nissan .
Needless to say , that ’ s a sliver of what Tesla is worth , even though the U.S. company ’ s annual output is still almost a rounding error for the Renault-Nissan alliance .
This juxtaposition sends a crystal clear message : Carmakers that grew fat and happy producing combustion engine vehicles won ’ t get any help from the stock market now that @ @ @ @ @ @ @ electric future .
Instead the gasoline gang are going to fund these changes themselves and it ’ s going to be painful , for both employees and shareholders .
Long-established automakers have decided that their salvation is to be found in alliances and partnerships , which spread the cost of developing expensive technology over a greater number of car sales .
It ’ s why Renault tried to merge with Fiat Chrysler Automobiles NV , before Peugeot-owner PSA Group beat them to it .
But in Renault ’ s case its links to @ @ @ @ @ @ @ now , not solving them .
Relations with Nissan fell apart when former alliance boss Carlos Ghosn was arrested and remain fragile now that he ’ s free to settle scores .
Both sides have since hired new CEOs but their shareholders aren ’ t yet ready to buy the story that harmony has been restored .
With its own profits slumping , Nissan can ’ t afford to pay big dividends to Renault and the French are also earning less from the Daimler partnership .
The upshot is that Renault is a @ @ @ @ @ @ @ at the automotive unit dwindled to just 1.7 billion euros at the end of December ( though gross liquidity , including available credit lines , was a more respectable 16 billion euros ) .
One way Renault could free up some money would be to sell part of its Nissan stake , which might have the added benefit of helping to re-balance the alliance in Nissan ’ s favor , something the Japanese have long sought .
The trouble is Nissan ’ s shares have halved in value over the last two years @ @ @ @ @ @ @ Renault with nearly as much as it once would .
Interim CEO Clotilde Delbos all but ruled out such a move on Friday .
So it ’ s no wonder that Renault has opted to drastically scale back its own dividend and will try to cut costs by 2 billion euros in the next three years .
Delbos , who ’ s also the chief financial officer , didn ’ t go into much detail about how those savings will be delivered but the company plans to review its “ industrial footprint , @ @ @ @ @ @ @ possibility .
( Alliance partner Nissan has already announced 12,500 job cuts , while Daimler is targeting at least 10,000 . )
Lowering costs won ’ t be straight forward .
New Renault CEO Luca de Meo , a former Volkswagen AG executive , doesn ’ t start until July and French unions aren ’ t known for championing efforts to slash jobs .
In the near term , restructuring costs will also put further pressure on Renault ’ s cash flow and the coronavirus could yet create unexpected problems .
But unlike @ @ @ @ @ @ @ have a queue of wealthy supporters clamoring to help fund this epochal clean-vehicle transition .
One way or other , employees and existing shareholders will end up paying .


washingtonpost--2020-06-08--New York City’s Shops Cautiously Reopen After Months on Lockdown

It won ’ t be the same , of course .
Only curbside pickup is allowed in this first phase of New York ’ s Covid-19 reopening , but Farquer is prepared .
Her five stores , called Lockwood , are for people who enjoy browsing , selling items like coffee mugs that say “ Social Distancing Club , ” Star Trek jigsaw puzzles and vanilla-scented erasers .
For New York ’ s small businesses , which depend almost entirely on city residents , Monday marks a vital moment to start bringing in the customers and revenue they lost during @ @ @ @ @ @ @ more precarious with the current social unrest .
Farquer ’ s Lockwood survived by selling merchandise through her website and getting four of her five landlords to cut rent by as much as 40 % for the summer .
Nearly 90 % of small businesses have seen a large or moderate negative effect from the pandemic , according to the U.S. Census Bureau .
Yet even as small shops scramble to get back to business and earn some money for the families that own them , major retail chains aren ’ t rushing @ @ @ @ @ @ @ not yet reopen its Herald Square flagship , one of the world ’ s largest department stores .
Tiffany & Co. will wait at least another few days before considering serving shoppers at its Fifth Avenue shop .
Coach , Kate Spade and Stuart Weitzman fashion boutiques will stay closed , as will New Balance shoe stores and Zales jewelry locations .
Ulta Beauty hasn ’ t yet set a timeline for its return to the city .
One that does plan to open is the Container Store , which will offer pickup @ @ @ @ @ @ @ ’ re tracking everything you need to know as New York reopens after the Covid-19 shutdown .
Read our explainer and sign up for alerts sent directly to your inbox .
These big chains have hundreds of stores across the U.S. that have reopened in recent weeks and robust e-commerce operations fueled by vast international supply chains and distribution channels , so business elsewhere can prop up their stores in New York .
Local shops didn ’ t have any of those benefits .
“ Small businesses are typically managed by their founders @ @ @ @ @ @ @ , director of retail studies at the Columbia Business School .
“ A small business owner has a rent bill due , merchandise they ’ ve taken in that they haven ’ t paid for and employees they feel honor-bound to re-employ .
So there ’ s probably a different motive component to small businesses reopening.
” That ’ s certainly the case with Christine Alcalay , a fashion designer who owns two boutiques in Brooklyn called Kiwi and Fig .
She ’ s kept her stores afloat by revamping the company ’ @ @ @ @ @ @ @ shop , but sales are still down about 80 % from a year ago .
She furloughed all but one of her 10 employees when the pandemic hit .
That left her delivering online orders , answering customer e-mails and texts , while securing a loan from the Small Business Administration , which allowed her to start paying her staff again .
She also made Instagram videos , in which she not only modeled clothes , but also talked about her struggles as a business owner .
Alcalay initially planned to make a @ @ @ @ @ @ @ scaled it back because of the protests over police brutality .
“ It doesn ’ t feel like the right time to be pushing merchandise with what ’ s going on right now , ” she said .
Still , she planned to fix up the front of the stores for when people pick up orders .
And she already had a local artist paint pickup hours and website addresses on the windows .
“ At some point you have to keep the business going , ” she said .
If limited retail @ @ @ @ @ @ @ a lot of us it ’ s going to come just in the nick of time .
”


washingtonpost--2020-06-08--Black Business Owners’ Ranks Collapse by 41% in U.S. Lockdowns

“ The negative early-stage impacts on minority- and immigrant-owned businesses , if prolonged , may be problematic for broader racial inequality because of the importance of minority businesses for local job creation , economic advancement , and longer-term wealth inequality , ” said the report ’ s author , Robert Fairlie of the University of California at Santa Cruz .
The findings add to other data showing that the pandemic has broadly hit African Americans harder than other groups , with blacks suffering higher rates of mortality from the coronavirus and greater joblessness .
While unemployment among white Americans fell @ @ @ @ @ @ @ to data released Friday by the Bureau of Labor Statistics , the jobless rate for African Americans rose slightly to 16.8 % .
The disparities put a stark spotlight on racial inequalities as protests continue nationwide in the wake of the death of George Floyd , an unarmed black man , at the hands of a white police officer in Minneapolis .
The NBER ’ s study evaluated data from a federal government population survey to estimate the number small business owners that had ceased operating from pre-pandemic February to April , the @ @ @ @ @ @ @ .
The report makes no assumptions about whether the owners will be shuttered only temporarily or permanently , and it notes certain government relief efforts that could help keep small businesses afloat , especially the $ 669 billion Paycheck Protection Program .
The study doesn ’ t capture most of the second tranche of funding in the PPP program , which started at the end of April and reached many small firms that were shut out in the first round .
A new bill signed last week gives small businesses more flexibility in @ @ @ @ @ @ @ , which can be converted into grants as long as owners follow program guidelines .
Among other changes , it extends the period in which businesses can use the funds and still seek loan forgiveness to 24 weeks from eight weeks .
Overall , the number of operating business owners of all groups fell to 11.7 million in April from 15 million two months earlier , a 22 % decline that Fairlie calls “ unprecedented.
” Aside from blacks and immigrants , Hispanic small business owners also fared poorly , with a 32 @ @ @ @ @ @ @ Asians and females saw drops of 26 % and 25 % , respectively .
Among industries , the only sector that didn ’ t suffer a decline in small business owners was agriculture , which saw a 7 % uptick .
Hard-hit industries include arts , leisure and hotels , which fell by 35 % , and construction , down by 27 % .


washingtonpost--2020-06-08--Analysis | The Office Isn’t Dead. It’s Just Convalescing

My initial reaction at being told to stay home in January was panic .
With two teenage daughters about to start online schooling and a husband who would also need to work from home , I struggled to see how our crowded 47th-floor apartment would cope .
I ’ d had a taste already , when the office became all but inaccessible for several days during the height of Hong Kong ’ s protests last year , so I knew what we were facing .
Over the following , fractious few months , I have jostled for space on the @ @ @ @ @ @ @ girls , and tussled over the yoga mat — a crucial stretching prop for laptop-induced shoulder strains , as well as an essential accessory for online PE classes .
Somewhere along the line , I grew to like it .
I ’ ll miss the home-work experience , when it finally ends ( like many other companies in Hong Kong , our return is on a split-team basis , so we aren ’ t back at the office full-time yet ) .
The family has bonded more tightly as a result .
I @ @ @ @ @ @ @ rhythm , acquiring some admittedly unhealthy habits along the way — such as snacking on Cheetos , bingeing on TV news channels , and reading the obituaries .
I ’ m in the minority , though .
We ’ re fortunate in having more living space than most .
In a city such as Hong Kong , which is densely packed with tiny apartments , it ’ s simply not viable for many people to work from home indefinitely .
The average apartment size is 40 square meters ( 430 square feet ) @ @ @ @ @ @ @ York City , according to Jones Lang LaSalle Inc .
Many employees just don ’ t have the room to set up a home office .
And living in such cramped quarters , they need to get out regularly .
The cost-benefit equation for Hong Kong is skewed .
With urban areas being closely packed and the subway system efficient , getting to the office is quick and easy for most people .
It may be a different story in the U.S. , where cities sprawl into the suburbs , commute times may @ @ @ @ @ @ @ often less reliable .
Or in Asian metropolises such as Mumbai , which is densely packed but plagued with horrendous traffic congestion and a more than 150-year-old train network that make suburban working attractive .
That ’ s not to suggest that Hong Kong will escape any long-term impact from Covid .
Macquarie Group Ltd. is among companies that have already decided to cut space in the city ’ s skyscrapers .
Other financial services firms can be expected to follow .
Still , there are many office jobs that can ’ t @ @ @ @ @ @ @ 30 % of bank employees in the city can work from home , Bloomberg Intelligence analyst Francis Chan estimates .
“ In industries that thrive on information flow and speed , like sales and trading , you may see back offices and compliance work from home but traders will likely have to go back even if they already have three screens at home , ” said Parijat Banerjee , a financial services consultant at Singapore-based Greenwich Associates .
In any case , most people don ’ t want to get rid of the @ @ @ @ @ @ @ Pomeroy and Davey Jose wrote in a report titled “ Leaving the City.
” They just don ’ t want to be there all the time .
That broad conclusion applies across all developed markets where the technology is adequate to enable remote working , Pomeroy said .
Ultimately , offices are more than just a place to do business — like the cities that surround them , they are meeting points for social and cultural exchanges .
Humans are social animals , and we need more contacts than those our immediate family @ @ @ @ @ @ @ that resonated with me this week as I surveyed the near-deserted pantry at Bloomberg ’ s central Hong Kong offices , a space that was typically heaving with people and animated conversations before the pandemic .
A return to normality can ’ t come soon enough .


washingtonpost--2020-06-08--TPG’s Jon Winkelried Wrestles With Racism, China and Pandemic Deals

Winkelried , 60 , has a lot of other things on his mind , too .
He worries about the stresses on his employees , he ’ s alert to the growing risks around TPG ’ s assets in China , and he ’ s outraged at the state of race relations in America , thrown into sharp relief by the police killing in Minneapolis of a defenseless George Floyd .
But it says a lot about the trajectory of the pandemic that one of the country ’ s biggest private-equity firms has shifted its posture from defense to offense @ @ @ @ @ @ @ economic decline since the Great Depression , it could be that now is the time to buy before the best bargains are gone .
TPG did its first deal of the pandemic in April , acquiring a majority stake in LifeStance Health Inc. , a provider of lower-cost mental health services .
The firm is hunting for more health-care investments , specifically in telemedicine and drug development .
It ’ s also prospecting in education and broadband communications -- two industries where Winkelried sees winners emerging from the dislocations and demands created by @ @ @ @ @ @ @ A society evolves as we go through different crises , ” he said .
“ We ’ re spending a lot of time thinking about the environment that we ’ re living through right now and what it ’ s going to feel like on the other side.
” For many in private equity , the focus is on credit .
Apollo Global Management Inc. , KKR & Co. and Oaktree Capital Group are building multibillion-dollar stockpiles to pounce on distressed debt .
Even Vista Equity Partners , which like TPG specializes in @ @ @ @ @ @ @ earnings growth , is raising money to lend .
Lifestyle and entertainment experiences , fitness and travel were among the trends that flourished amid the economic stability and relative prosperity of the decade after the 2008-2009 financial crisis .
TPG chased them on the way up , investing in companies such as Cirque du Soleil , Viking Cruises Ltd. and the Life Time chain of gyms .
Now the firm is trying to keep those businesses afloat until demand recovers -- and betting it does .
To manage , Winkelried drew on lessons @ @ @ @ @ @ @ Group Inc. and his experience in crises dating to the early 1980s .
He said some TPG companies have had to furlough or fire workers to cut costs .
And to ensure they had enough cash , a number tapped bank credit lines , received injections from TPG funds or took advantage of government aid .
He acknowledged the controversy around the use of taxpayer funds to prop up private-equity investments .
TPG decided it didn ’ t qualify for the Small Business Administration ’ s forgivable loans under the Paycheck Protection Program @ @ @ @ @ @ @ .
It did take advantage of Health and Human Services Department programs that provide advances on expected revenue from the government .
“ We had a number of health-care companies that are providing vital essential services to the constituents that they serve and were impacted by the situation with Covid , ” Winkelried said .
“ It allows them to stay in business and continue providing the services that are critical and important services.
” One major risk unrelated to the pandemic is potential fallout from the Trump administration ’ s fight with @ @ @ @ @ @ @ 2.5 billion of investments .
Others among its more than 200 portfolio companies rely on Chinese supplies .
The U.S. government ’ s disputes with China have mostly concerned trade , technology and security .
But President Donald Trump has taken steps toward cracking down on Chinese companies that violate U.S. accounting rules , throwing open the possibility that the battleground expands to include finance .
One of the outcomes “ could be that relationships and economic activity effectively freezes between the U.S. and China , ” he said .
“ You do @ @ @ @ @ @ @ investment , how much value you have as an investment organization , what you ’ re flowing to China .
Because if it gets stranded or if it gets frozen for some reason and you can ’ t get your money out , then obviously it has significant implications.
” As co-CEO alongside Jim Coulter , one of Winkelried ’ s initiatives has been improving gender balance at TPG ’ s company boards .
Over the past two years , the firm has added 75 female directors .
Now the priority is people @ @ @ @ @ @ @ LGBTQ .
Like millions of Americans and much of the world , Winkelried was horrified by the killing of Floyd , an unarmed black man , by a white cop on May 25 , and he ’ s transfixed by the anger and civil unrest that has followed .
He and his wife , Abby , participated in a demonstration in Northern California , where he ’ s been staying during the pandemic .
“ Hostility toward people of color but also other underrepresented groups is something we ’ ve been living with @ @ @ @ @ @ @ just has to change , ” he said in the interview .
“ It ’ s time to do something about it .
People in the streets , I encourage that .
I applaud the protests .
”


washingtonpost--2020-06-08--Analysis | Why Samsung’s Billionaire Scion Is Facing Jail Again

Lee , 51 , is the vice chairman of Samsung Electronics Co. and heir apparent at South Korea ’ s most powerful conglomerate .
After his grandfather founded the company , his father led the group until he suffered a heart attack in 2014 .
The elder Lee has reportedly been in a coma since then , while his son has become the de facto leader .
But his succession has been complicated because he can ’ t simply take over his father ’ s assets .
South Korea has one of the heaviest inheritance taxes in the world , @ @ @ @ @ @ @ $ 2.5 million .
The elder Lee ’ s net worth is about $ 18 billion , according to the Bloomberg Billionaires ’ Index .
South Korea ’ s special prosecutors first indicted Lee in early 2017 on charges of bribery and corruption , alleging that Samsung provided horses and other payments to a confidante of the former president to win support to help ease his succession .
The case inflamed public opinion against the country ’ s powerful conglomerates , or chaebol , and triggered the impeachment of then-President Park Geun-hye .
@ @ @ @ @ @ @ five years in prison , but the sentence was suspended in 2018 and he was released from jail .
Still , the case wasn ’ t over .
The Supreme Court in August 2019 overturned the lower court ’ s decision to suspend the mogul ’ s sentence and ordered a retrial of the whole case .
Those hearings have been delayed because prosecutors have argued that one judge involved is biased and inclined to go lightly on Lee .
The Supreme Court now needs to decide whether to keep the judge involved @ @ @ @ @ @ @ the trial would drag into next year .
Prosecutors are seeking the arrest warrant to send Lee back to jail because of a separate but related investigation .
They argue that Lee should be imprisoned during the proceedings for the new allegations .
However , their request for the warrant came just days after Lee requested a public assessment of the validity of his indictment , essentially trying to bypass professional prosecutors by appealing to a review committee that would be made up of outside experts .
The attempt to jail Lee is @ @ @ @ @ @ @ to his request .
Separate from the original bribery investigation but also related to succession , prosecutors are digging into the details of a controversial merger between two Samsung Group ’ s units in 2015 and alleged accounting fraud that may have helped Lee ’ s efforts to gain control .
The probe kicked off after South Korea ’ s financial regulator concluded that Samsung Biologics Co. intentionally violated accounting rules and inflated its value ahead of an initial public offering .
Prosecutors suspect the violation was to justify the merger ratio between @ @ @ @ @ @ @ and Samsung C & T , which helped bolster the value of the heir ’ s stake in Cheil and his influence at Samsung Group .
The Biologics unit has said it didn ’ t violate accounting standards .
Samsung has largely continued business as normal during the years-long probe , and investors have been mostly unfazed .
Samsung Electronics ’ shares soared during 2019 and into the first months of 2020 before the coronavirus pandemic , despite prosecutorial scrutiny and investigations into more than a hundred of group officials .
The potential @ @ @ @ @ @ @ for Samsung because his absence would render it more difficult to make major decisions , such as mergers and acquisitions or extraordinary investments .
A request from Lee ’ s lawyers for a public assessment of the validity of his indictment could delay the resolution : If the panel is formed , it will make an assessment and give recommendations to prosecutors in coming months .
Samsung is fighting not just for Lee ’ s liberty , but for its corporate reputation .
The allegations that it used gifts to buy government favor @ @ @ @ @ @ @ richest men could take over his family ’ s company are so explosive they inflamed public opinion against major South Korean companies and shook the political balance of the nation .
Samsung and Lee are determined to clear their names .
The scion made a rare , personal apology in May , admitting missteps in the past and pledging not to hand leadership of the group to his children .
Samsung has also been very active in helping South Korea ’ s battle against the coronavirus , dispatching its own doctors to help @ @ @ @ @ @ @ up production of testing kits .


washingtonpost--2020-06-04--Businesses Hurt First by Virus Then Looting Sweat Insurance

Hart is among business owners digging into the details of their insurance policies to see what losses might be covered .
Hart said he ’ s confident his claim will be successful , but that doesn ’ t make the process an easy one .
“ For every item I ’ m missing , I have to supply an invoice .
That could be real tough , ” he said , with some items purchased a year or two ago .
“ You just got ta try to work through it.
” Protesters have come out in droves across the @ @ @ @ @ @ @ of George Floyd , an unarmed black man who died after a white Minneapolis police officer knelt on his neck for more than eight minutes -- the latest incident of brutality against African-Americans .
While the protests have been largely peaceful , some people have used the unrest as an opportunity to vandalize and loot stores in cities including New York , Los Angeles and Wilmington .
“ It was wrong what they did to George Floyd -- it ’ s sickening , ” Hart said .
“ But when you take it @ @ @ @ @ @ @ just has a small business , ” he said , trailing off while shaking his head .
The civil unrest comes as business owners continue to cope with the economic impact of the Covid-19 outbreak , which also required them to analyze the fine print of their insurance policies .
While there ’ s been a debate about whether business-interruption insurance covers retailers ’ pandemic-related losses , property damage from riots , civil commotion and vandalism are generally covered under standard policies , according to the Insurance Information Institute .
The insurance industry @ @ @ @ @ @ @ t pay for virus losses because of a physical-damage requirement , an issue now being fought over by business owners , attorneys and lawmakers .
The situation is clearer when there are broken storefronts from looting , said Kim Winter , who leads Lathrop GPM ’ s insurance recovery and counseling practice group .
“ Here we know that there is actual direct physical damage -- there ’ s no question about it , it ’ s more than just a microscopic virus , so that ’ s the difference , ” she @ @ @ @ @ @ @ an associate at Lathrop GPM , said policyholders should try to alert their insurers quickly , even though the protests are still going on , and study their coverage closely .
While property damage is often covered , the double-whammy of the pandemic and looting could mean business-interruption claims become more complicated down the road , Winter said .
The 1992 riots in Los Angeles were the costliest civil-disorder event in U.S. history , totaling about $ 775 million in insured damage at the time , according to the insurance institute .
That @ @ @ @ @ @ @ some natural disasters , including Hurricane Katrina , which resulted in $ 41 billion in insured losses .
Meyer Shields , an analyst at Keefe , Bruyette & Woods , said in a June 1 note that the firm ’ s best guess is that insured damages should be “ relatively modest , ” but that the combination of those losses , costs tied to the pandemic and a hurricane season forecast to be stronger than normal could weigh on insurers .
For now , business owners on the front lines are the @ @ @ @ @ @ @ ’ t clear when Al ’ s , the sporting-goods store in Wilmington , will be able to restock , with some suppliers unable to ship goods for weeks because of the pandemic , Hart said after putting a thick chain and padlock on the store ’ s temporary plywood door .
Dias said he ’ d let his insurance policy lapse after closing more than two months ago because of Georgia ’ s Covid-19 lockdown .
It was hard to cover the costs as well as his $ 20,000 monthly rent in @ @ @ @ @ @ @ said .
Dias had planned to open on Monday , but found the windows smashed and store ransacked when he stopped by at 5 a.m. Saturday .
For now , he ’ s started a fundraiser and is counting on the generosity of customers to reopen .
“ This store is very famous , ” said Dias , whose shop ’ s Instagram page is filled with pictures of Atlanta hip-hop artists and other celebrities with his apparel .
He vents at the injustice of looters targeting a black-owned shop .
“ We @ @ @ @ @ @ @ years , so people know us .
”


washingtonpost--2020-06-08--Another Zeppelin Creation Falls From the Heavens

It ’ s possible you haven ’ t heard of ZF , because it doesn ’ t sell directly to consumers and isn ’ t listed on the stock market .
But you will have heard of Ferdinand von Zeppelin , the man who set up ZF a century ago to start building gears for his airships .
This mode of travel captured the world ’ s imagination until the 1937 Hindenburg fire ended the era of luxurious passenger-carrying dirigibles .
Instead of airships , ZF has used aggressive dealmaking to cross the Atlantic .
It swallowed U.S. rival TRW @ @ @ @ @ @ @ , and after years eyeing Wabco it finally made a move last year .
( Wabco is based in Bern , Switzerland , but was listed in the U.S. ) These deals have helped reduce the company ’ s dependence on combustion-engine technologies , which now comprise less than 30 % of ZF ’ s revenues .
But future-proofing has forced the once cautious German group to embrace some pretty racy , Anglo-Saxon ways .
The Wabco deal was priced at an eye-watering 20 times the target ’ s average earnings over the @ @ @ @ @ @ @ 9.6 billion euros of debt and it has another 5 billion euros of pension liabilities , according to Bloomberg data .
Wabco ’ s boss , Jacques Esculier , is in line to receive a $ 24 million golden parachute payment for selling to ZF , but that ’ s nothing compared with the $ 88 million that TRW boss John Plant received after ZF ’ s takeover .
Some companies have tried to amend or back out of deals agreed before the coronavirus pandemic but the Wabco deal closed as planned last @ @ @ @ @ @ @ immediately to employees , revealing up to 15,000 job cuts ( about 10 % of its workforce ) .
If debt covenants aren ’ t met , “ external creditors could demand influence over our business decisions , ” the email warned .
Lacking a stock market listing , ZF can ’ t easily raise capital from equity investors .
When car sales were still growing steadily , automotive companies and their suppliers could afford to carry some excess weight .
ZF ’ s operating profit margins were about 4 % on average @ @ @ @ @ @ @ only a thin cushion .
Now it ’ s having to confront three shocks all at once : coronavirus production shutdowns , a global recession and the structural shift to electric vehicles .
About 80 % of ZF ’ s 50,000 German employees have had their working hours cut because of the pandemic .
The company warned it will make large losses and credit-rating agencies have downgraded its debt to junk .
ZF has joined the ranks of so-called “ fallen angels , ” which have lost their investment-grade status .
Its bonds @ @ @ @ @ @ @ value at one point , but have rebounded following aggressive market interventions by central banks .
About 94 % of the company ’ s shares are controlled by the Zeppelin Foundation , a legacy of the airship inventor that ’ s overseen today by the German city of Friedrichshafen — population 60,000 .
The cost cuts are a blow to the town , situated on the shores of the idyllic Lake Constance .
Dividends from ZF helped pay for its hospital , university and preschools .
The town ’ s mayor , Andreas @ @ @ @ @ @ @ s supervisory board and is pretty influential .
Stefan Sommer , the architect of ZF ’ s debt-funded expansion , stood down as chief executive officer in 2017 after clashing with the more cautious Brand .
ZF ’ s borrowings are pretty esoteric too .
It has regular bonds but it ’ s also a prolific user of Schuldschein finance , a form of debt — not quite a loan and not quite a bond — that ’ s popular with Germany ’ s “ Mittelstand ” of small and medium-sized companies .
@ @ @ @ @ @ @ German-speaking countries , with borrowers attracted by the limited disclosure requirements .
Schuldschein debt can cause complications , though , if a company gets into difficulty .
The permission of each borrower ( rather than a simple majority ) is required to restructure the debt .
No wonder ZF is so keen to keep its creditors at arm ’ s length .
Last month it amended a key lending agreement , which will allow its net borrowings to widen to as much as 5.5 times Ebitda ( a measure of cash earnings ) @ @ @ @ @ @ @ company is not in any immediate danger because it has about 10 billion euros of cash , cash equivalents and credit facilities , and there are no major borrowings that need refinancing soon .
Still , its leverage is heading higher than its owners and lenders would like .
JPMorgan Chase & Co. advised ZF on its Wabco takeover and helped furnish it with a larger overdraft facility .
A decade ago JPMorgan advised Continental on how to defend itself against Schaeffler ’ s approach .
It knows all about the pitfalls of @ @ @ @ @ @ @ of the market .


washingtonpost--2020-06-08--Analysis | Another Zeppelin Creation Falls From the Heavens


washingtonpost--2020-06-08--Fed Expands Main Street to Include More Small Businesses

The program , among nine unveiled by the Fed to combat the fallout from shutting down the U.S. economy to limit the spread of the coronavirus , has been long awaited since it was initially announced in late March .
Powell can expect more questions on how many jobs it will save when he speaks to reporters Wednesday following a meeting of the Fed ’ s policy-setting committee .
Businesses participating in the program , which aims to boost lending to small and mid-size companies through three facilities , will be able to defer principal payments on their loans for @ @ @ @ @ @ @ announced one year .
Interest payments will still be deferred for one year .
The Fed lowered loan minimums to $ 250,000 from $ 500,000 and extended the loan term to five years from four .
It also increased loan maximums across the three facilities .
Company loans up to $ 300 million will now be eligible for the program .
Loan recipients are still limited to 15,000 employees or fewer and an annual revenue cap of $ 5 billion .
The requirements on earnings before interest , taxes , depreciation , and @ @ @ @ @ @ @ .
Banks will be required to hold 5 % of the loans on their balance sheet for all three facilities , where previously they had to hold 15 % of loans to more-risky businesses .
With that change , and the increase to the maximum loan size , the Fed is taking on more of the risk .
The adjustments address concerns around whether companies would utilize the lending facilities , and whether banks were willing to make the loans .
The Fed said it expanded the program to make it available to @ @ @ @ @ @ @ better help those that have been shut down , and facing significantly reduced revenue , for months .
“ There was some thought that the program was a paper tiger that looked really good but wouldn ’ t be used , ” said Nathan Sheets , PGIM Fixed Income chief economist .
“ The Fed is saying that they really want to lend through this window , that this is important for the economy.
” While these modifications should increase uptake of the facility , the Fed opted to leave unchanged the affiliate @ @ @ @ @ @ @ by private equity firms .
In addition , the restrictions on dividends and executive pay remain , as does the vague stipulation for companies to try to maintain their payroll .
The Main Street program will be open for lender registration soon , the Fed said , and it ’ ll start buying loans “ shortly afterward.
” The three facilities will buy up to $ 600 billion in loans and are backed by a $ 75 billion investment from the Treasury Department .
The backstop is part of the $ 454 billion @ @ @ @ @ @ @ for the Fed ’ s emergency-lending programs during the coronavirus pandemic .
This marks the second update to the Main Street program , which was first announced March 23 .
The Fed said it received more than 2,200 comment letters about the program , prompting an expansion at the end of April .
The central bank has come under scrutiny from lawmakers about its delay in launching the program , which presents new challenges to the Fed , such as how to lend to companies that don ’ t have official designations from @ @ @ @ @ @ @ that the central bank was “ days ” away from launching the facility and called it the most challenging program to set up .
The Fed also said that it is working to establish a lending program for nonprofit organizations .
“ The changes announced by the Fed today are helpful , but not game-changing for most businesses , ” said Carolyn Alford , a partner at King & Spalding who heads the law firm ’ s finance group .
“ The modifications to defer payments and extend the life of loans will @ @ @ @ @ @ @ weather the economic uncertainty over the foreseeable future .
”


washingtonpost--2020-04-13--13-Hour Rescue Plans and Guts: How One Industry Is Surviving

“ It ’ s been crazy busy , ” said the 26-year-old Inver .
“ We ’ ve managed to generate almost the same amount of revenue that we had before the lockdown.
” Inver is part of a growing number of food wholesalers who are pivoting to households to avoid a shutdown and laying off workers amid the COVID-19 outbreak that ’ s decimated small businesses .
Over the past few years , the so-called direct-to-consumer movement has taken hold in categories like clothing and beauty with firms offering lower prices by eliminating the retailer middlemen .
Food producers @ @ @ @ @ @ @ embrace this model , but are now catching up out of necessity .
What this shift means for the industry ’ s long-term future remains to be seen .
However , it ’ s not hard to see it helping to push more Americans to embrace cooking .
Many are preparing more meals than ever because of the stay-at-home orders , and now they have more options to get high-quality food delivered at what are often lower prices than they are used to paying .
Overall , about 60 % of small businesses @ @ @ @ @ @ @ pandemic , according to Hello Alice , which offers advice and resources to small companies .
And nearly 10 % have made a permanent change .
Out on the west coast , the switch to retail meant that Joe Conte could hire back most of the workers that he ’ d laid off .
He was preparing to close Water2Table Fish Co. after restaurant orders for halibut , black cod and sea bass evaporated when the Bay Area enacted America ’ s first shelter-in-place order on March 16 .
But within a week @ @ @ @ @ @ @ .
On a typical day at San Francisco ’ s Pier 45 , Conte , who buys from local fishing boats , is putting together more than a hundred home deliveries for the Bay Area .
The new program is generating about 60 % of the revenue that he did from restaurants .
There are other benefits , too .
Since the lockdowns in the U.S. , financially stricken small businesses are enacting a range of measures so they don ’ t have to close .
Restaurant owners have resorted to crowd funding @ @ @ @ @ @ @ holding classes online and skin care companies are selling hand sanitizers .
Still , the road ahead for them is precarious .
Overhauling a business quickly , including revamping supply chains and finding enough new customers , is no doubt difficult .
More than 10 % of small businesses are on the verge of closing for good within the next month , according a poll released by the U.S. Chamber of Commerce .
Their survival is key because as a group they account for almost half of U.S. private employment .
In Atlanta @ @ @ @ @ @ @ in Georgia and South Carolina , had to quickly change when his business , Farmers & Fishermen Purveyors , collapsed .
He reckons that 97 % of sales got wiped out in one day last month ; what he described as “ boom ... gone.
” The 56-year-old responded by mapping out a plan over 13 hours to shift from supplying restaurants to delivering to households .
His wife provided inspiration by asking friends if they wanted friends-and-family meat and seafood packages .
Enough people responded that it gave him confidence to take @ @ @ @ @ @ @ far Halpern is surviving .
Gross profit is down about a quarter from before the crisis struck because the big orders from restaurants , which can total $ 5,000 , are gone , and being replaced by purchases that average less than $ 200 .
But he ’ s managed to keep his vans running and employees working .
Both Halpern and Inver in Philadelphia said they plan to continue offering home deliveries once the pandemic passes .


washingtonpost--2020-04-01--Analysis | Virus Sell-Off Turns Bonds Into ‘Fallen Angels.’ Here’s Why Downgrades Matter

Companies are facing a near unprecedented rate of downgrades as the coronavirus pandemic , paired with the worst oil rout in decades , threatens their supply chains , consumer demand or both .
More than $ 92 billion of debt fell to high yield from investment grade in March between 11 different companies , according to research firm CreditSights .
Most of that comes from Ford Motor Co. and Occidental Petroleum Corp. , which will be the two largest issuers in the Bloomberg Barclays high-yield index when it rebalances .
Most credit strategists see twice as much damage ahead , @ @ @ @ @ @ @ that include the remainder of the year : Generally speaking , a fallen angel is a bond that is downgraded to BB+ or below ( categories considered junk , or , more politely , high yield ) by at least two of the three major rating firms -- Moody ’ s Investors Service , S & P Global Ratings and Fitch Ratings -- after being formerly rated BBB- or higher ( categories that are investment grade ) .
Downgrades can happen when a company isn ’ t creating enough revenue or generating enough @ @ @ @ @ @ @ when it takes on so much debt that its financial leverage -- usually calculated by debt as a measure of earnings -- becomes disproportionate .
A fall to junk status affects both borrowers and investors .
Downgrades make borrowing more expensive , and could mean that lenders will tack on protections in the form of debt covenants .
Junk status can force a wave of selling by investors whose mandates prevent them from holding credits below investment grade .
The prices of downgraded bonds may also need to fall to compensate investors for @ @ @ @ @ @ @ liquid , or actively-traded security .
On the other hand , traders often start selling off troubled bonds well before the rating agencies weigh in , which can limit the amount of forced selling once a downgrade actually occurs .
That ’ s why investors often say credit ratings are retroactive and backward-looking .
It depends on who you ask .
Credit Roundtable , an industry group for corporate bond investors , says that credit raters have mostly acted rationally and sensibly through the current crisis , according to the group ’ s @ @ @ @ @ @ @ been concern that raters may not have been sticking to their motto in “ rating through the cycle , ” which acknowledges near-term shocks but tries to maintain a longer-term view of the borrower ’ s underlying health , particularly for large , well-capitalized companies .
Critics of the agencies point to the way companies in recent years had loaded up on cheap debt to fuel acquisitions , often sacrificing credit metrics in the process .
Many investors have argued that raters weren ’ t hard enough on those firms , cutting them @ @ @ @ @ @ @ reduce their debt load sometime in the future .
Market access is a big one -- investment-grade companies tend to be the largest employers in the world , and it ’ s important for them to be able to borrow cheaply and frequently .
Higher credit ratings tend to translate into lower borrowing costs .
The average U.S. investment-grade company pays a rate of about 3.5 % , while high-yield is nearly 10 % .
Another consideration in the current environment is the U.S. Federal Reserve ’ s intervention to help investment-grade issuers @ @ @ @ @ @ @ .
The Fed announced it will be buying some of their bonds , and allowing those companies to borrow directly from the central bank .
Junk rated companies will not be included in those facilities .
No -- after the dust settled from that crisis , the two biggest rating agencies , S & P and Moody ’ s , agreed to pay over $ 2 billion to settle federal and state claims that they gave inflated ratings to the mortgage-backed securities whose failures triggered the crisis .
The suits were helped by @ @ @ @ @ @ @ P employee saying , “ Let ’ s hope we are all wealthy and retired by the time this house of cards falters.
” While the mortgage market is struggling again in the current rout , it ’ s not because the securities themselves are inherently risky .
Rather , the coronavirus pandemic is threatening to make good loans go bad , from both companies and individuals that may not be able to pay their leases , rent or mortgages .
Though they ’ re typically called “ agencies , ” raters are @ @ @ @ @ @ @ a former journalist , helped start the business in 1909 by issuing letter grades to rank the ability of railroad companies to repay loans .
Ratings became so widely used that in 1936 the Office of the Comptroller of the Currency banned banks from holding bonds not rated investment grade .
The SEC further weaved Moody ’ s , S & P and Fitch into the regulatory fabric in 1975 by naming them “ Nationally Recognized Statistical Rating Organizations ” and requiring investors in some circumstances to buy only bonds with their seal @ @ @ @ @ @ @ led to lower borrowing costs for many companies and municipalities , since investors could think they had expert guidance to rely on .
Today , though , ratings upgrades don ’ t necessarily translate into lower yields , or downgrades into higher ones .
That ’ s because professional investors usually have priced in the moves well before they happen , leaving raters in the position of catching up to the market .
Ford ’ s bonds were already trading like junk for well over a year before it received two high-yield ratings @ @ @ @ @ @ @ some may have thought to be a further possibility .
Some of Occidental ’ s bonds were trading at distressed levels two weeks before it officially became a fallen angel .


washingtonpost--2020-03-22--Pentagon Raises Contractor Payments to Keep Cash Flowing

The Pentagon ’ s Director of Defense Pricing and Contracting issued a “ Deviation on Progress Payments ” memo late Friday that increases the rate for contracts to 90 % of incurred costs from 80 % for large businesses , Pentagon spokesman Air Force Lt. Col. Mike Andrews said in a statement on Sunday .
“ This is an important avenue where industry cash flow can be improved , ” Andrews said .
The department also “ is accelerating payments through several means to prime contracts , and directing prime contracts to expedite payments to subcontractors , ” Andrews said @ @ @ @ @ @ @ manages contracts is working with the Pentagon ’ s accounting organization that makes the payments “ to ensure that invoices are continuing to be paid in a timely manner , ” Andrews said .
Pentagon acquisition head Ellen Lord on Friday issued guidance to industry that defense contractors are “ expected to maintain their normal work schedules ” -- within recommended guidelines from the U.S. Centers for Disease Control and Prevention -- amid the coronavirus outbreak because they ’ re considered “ critical infrastructure.
” Byron Callan , a defense industry analyst for @ @ @ @ @ @ @ email that the new policy “ will work if the large contractors assist smaller ones that are typically small and private .
Think of the $ 50 million machining parts company that has 70 % of sales for commercial aerospace and 30 % of defense.
” The industry also risks negative blow-back if the increased payments are abused , he said .
“ If the large public companies use this change to accelerate share buybacks , I would expect management to be tarred and feathered , ” he said .
“ It ’ @ @ @ @ @ @ @ paying people during this crisis , but the Pentagon needs to do more than just trust the better angels of these companies ’ nature to prevail , ” Mandy Smithberger , a director for the Project on Government Oversight , which monitors military spending , said in an email .
“ They should require companies that receive these funds to commit that this money won ’ t go to dividends , salaries , and stock buybacks , but to the employees on the front lines who are most vulnerable.
” Shay Assad , @ @ @ @ @ @ @ on pricing and contracts financing , said in an email the new effort reflects a fundamental misunderstanding of the regulations already in place that already provide for generous reimbursement rates .
Assad retired in 2019 .
“ The fact is that cost of borrowing ” from banks “ is negligible ” and doesn ’ t require additional Pentagon intervention , Assad said .
“ There is absolutely no reason to change the progress payment rates for large businesses .
Large business is more than capable of using their own cash or borrowing at @ @ @ @ @ @ @ taxpayer rip-off.
” Assad estimated that the top five defense contractors generated $ 93 billion in free cash flow between 2012 and 2017 .
“ They bought $ 90.5 billion of their own stock during that same time frame , ” he said .
“ There is no cash-flow intervention required .
”


washingtonpost--2020-05-04--Analysis | People in India, Japan Are the Most Nervous About Reopening

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washingtonpost--2020-05-04--Analysis | Australia’s Banking Payout Party Comes to an End

The road to the dismal present has been paved with money-laundering scandals , government inquiries , super-taxes , a housing market downturn and of course the coronavirus , but it ’ s another factor that has been most crucial : dividends .
Bank valuations , after all , aren ’ t a disinterested vote on the credit quality of a company .
Instead , they ’ re shareholders ’ best guess of the current value of future payouts , adjusted for the risk that the share price itself may rise or fall .
That ’ s been particularly important in @ @ @ @ @ @ @ of individuals managing their own retirement savings through so-called self-managed superannuation .
In most of the world , fund managers focused on capital growth dominate the stock market , to the extent that many tech companies treat paying cash back to shareholders as a failure of imagination .
In Australia , the retirement savers who make up a fifth of the stock market prize a steady and stable income , so generous dividend-payers like the country ’ s banks have consequently done well .
Even when its valuation peaked at three times book @ @ @ @ @ @ @ biggest of the four , was still paying out dividends equivalent to more than 6 % of its share price .
Australian banks were offering all the income security of owning a bond , but with equity-style returns .
There was just one problem .
Much though they may have behaved like bonds to their investors , Australian bank shares were equity all along — and with the party finally ending , it ’ s shareholders who are ultimately taking the hit .
On Monday , Westpac joined ANZ in deferring its decision @ @ @ @ @ @ @ year .
NAB went one step further last week , cutting its payout by about two-thirds and tapping shareholders for cash by selling A $ 3.5 billion ( $ 2.2 billion ) in new stock .
It ’ s a sign of how crucial payouts have become to Australian bank shareholders that even with an unemployment rate tipped to hit 10 % this year , both Westpac and ANZ are presenting their moves as delayed decisions rather than outright cancellations .
Even in a crisis , giving up the gospel of dividends risks @ @ @ @ @ @ @ shareholders that ’ s supported valuations ( and paid for executives ’ Maseratis ) for a generation .
The trouble is , shareholders are already voting with their feet .
Price-book valuations have slumped to positively European levels ; only Commonwealth Bank is now valued at a premium to its net assets .
Unlike other countries , which have spent more than a decade deleveraging , Australian household debt was at record levels relative to income just before the coronavirus struck .
As rising unemployment and falling property prices eat into borrowers ’ @ @ @ @ @ @ @ rightly ) making the assessment that the first call on banks ’ cash for the foreseeable future is likely to be funding defaulted loans .
Next will be fines , like the A $ 1.06 billion Westpac set aside Monday for dealing with a money-laundering case .
The silver lining is that those plunging share prices are making dividends , in isolation , look more attractive than ever .
If the coronavirus downturn proves less drastic than feared and Westpac ends up paying out full-year cash in line with last year ’ s @ @ @ @ @ @ @ % at current share prices — not bad at a time when its best one-year term deposit account is paying 1.2 % .
It ’ s a mark of how bad things have gotten for Australian banks that even the perennial promise of payouts isn ’ t enough to tempt shareholders back this time .
David Fickling is a Bloomberg Opinion columnist covering commodities , as well as industrial and consumer companies .
He has been a reporter for Bloomberg News , Dow Jones , the Wall Street Journal , the Financial Times @ @ @ @


washingtonpost--2020-03-05--Analysis | The Stimulus Toolbox to Help Virus-Stricken Economies

Cuts to interest rates are the traditional tool , but things aren ’ t so simple this time around : The Fed is joining other central banks in running out of space .
Its rate is down to a range of 1 % to 1.25 % ( compared with 5.25 % at the start of the last crisis ) , giving it limited ammunition for further stimulus .
Others are even more constrained .
The European Central Bank and Bank of Japan already have rates that are below zero -- meaning borrowers get paid to borrow money .
While many @ @ @ @ @ @ @ lead of the Fed and push rates lower , ultra-loose monetary policy is already the subject of vigorous debate about whether it does more harm than good .
Born in the 2008 crisis , the once unconventional idea of making huge bond purchases to nudge down long-term rates is now an established part of the central banks ’ armory .
Yet the strategy is seen as less effective when long-term rates are already low .
Advocates suggest boosting the policy ’ s power by expanding purchases beyond government and corporate bonds -- as @ @ @ @ @ @ @ with its buying of exchange-traded funds .
( In response to the outbreak , the BOJ was expected to raise its target for ETF purchases or buy the existing quota faster . )
The ECB resumed its so-called quantitative easing in 2019 ; other central banks have indicated they would be prepared to resurrect programs in the face of weakness .
Central banks could try to maximize their limited firepower by delivering a coordinated move , the theory being that joint action might boost confidence more than the sum of its parts .
@ @ @ @ @ @ @ 2008 , when the Fed , ECB and four other central banks acted together to lower interest rates .
Indonesia ’ s finance minister urged “ synchronized and coordinated policy responses -- monetary , fiscal and trade and investment policies -- to fight the weakening global demand and supply disruption.
” There are also calls for collaboration within countries : The incoming head of the Bank of England told Parliament on March 4 that he would coordinate measures with the U.K. Treasury .
There are more direct steps that policy makers can take @ @ @ @ @ @ @ freely .
Regulators in China have asked banks to be more lenient on bad loans -- providing relief through what ’ s known as forbearance .
The People ’ s Bank of China is extending 800 billion yuan ( $ 115 billion ) of cheaper loans to support smaller and private companies , while the ECB was considering how it might support banks through its long-term lending program .
JPMorgan Chase & Co. economist Allan Monks says the Bank of England could take steps such as canceling a planned increase in the capital @ @ @ @ @ @ @ no longer contained in China , worried consumers everywhere are reluctant to shop or spend .
That ’ s increasing calls to to do more to address the “ demand ” side of the equation , too .
The U.S. , Japan , Italy , Singapore and South Korea are among the countries assembling emergency spending packages , though in most cases they ’ re tied to spending for prevention and treatment of disease , rather than a boost to the broader economy .
Even before the coronavirus appeared , central banks were @ @ @ @ @ @ @ governments from lowering taxes to spending more on infrastructure -- should take on a larger role in spurring sluggish economies .
Such action can shore up demand more directly and more quickly than monetary easing .
Among possible fiscal measures that could be unleashed : tax cuts or credits to help companies with cash flow problems ; suspending fines for delivery delays ; and more generous medical leave and transfers for medical expenses .
Here ’ s what ’ s happening in some countries : China has has waived requirements for smaller companies @ @ @ @ @ @ @ from February to June .
The value added tax rate for smaller companies has also been reduced temporarily to 1 % from 3 % between March and May .
In the U.S. , Mnuchin said he planed to speak with banking agencies about what regulatory relief might be necessary during the worst of the coronavirus ’ s impact .
The U.K. is considering relaxing rules on sick pay .
A blockbuster option could be simply handing out cash to citizens .
There ’ s been a robust debate in recent years over whether @ @ @ @ @ @ @ by simply creating extra cash -- a method known as helicopter money -- but no institution is seriously considering it .
Governments , however , have been less circumspect .
Hong Kong , Singapore and Macau all announced plans to give cash payouts or vouchers to people , either through regular budgetary payments or one-time handouts .
In Hong Kong , each permanent resident of the city 18 or older was slated to receive a one-time handout of HK $ 10,000 ( $ 1,284 ) , a move Financial Secretary Paul Chan said @ @ @ @ @ @ @ by the heavy atmosphere .
”


washingtonpost--2020-03-05--Analysis | James Bond Will Wait, But Movie Theaters Have No Time for a Virus

There ’ s still a lot of uncertainty about how badly the coronavirus will spread and what it will do to the economy .
But what is clear is that the disruption couldn ’ t come at a worse time for the U.S. movie-theater industry in particular , where AMC Entertainment Inc. , Cineworld Group Plc ( Regal ’ s parent company ) and Cinemark Holdings Inc. together control nearly half the cinema screens and ticket sales , according to the Motion Picture Association of America .
That ’ s in addition to theaters they operate in Europe and Latin @ @ @ @ @ @ @ the sudden deluge of streaming-video services , which have been spending like mad on original content .
New offerings from Apple Inc. , AT & T Inc. ’ s WarnerMedia , Comcast Corp. ’ s NBCUniversal , Disney and so on may result in more people reserving trips to theaters only for the big blockbuster films worth venturing out to see .
WarnerMedia ’ s HBO Max is set to launch with a catalog of Warner Bros. movies in May , while NBCUniversal ’ s Peacock service coming next month will draw from @ @ @ @ @ @ @ already managed to sign up more than 25 million subscribers , and Netflix Inc. has signaled that it ’ s stepping up film investments after receiving 24 Oscar nominations , including for “ The Irishman , ” “ Marriage Story ” and “ The Two Popes.
” As Disney turns its attention to streaming , it also doesn ’ t have as large of a must-see theatrical film slate this year , having pushed off “ Avatar 2 ” to 2021 and the next “ Star Wars ” to 2022 .
Even before @ @ @ @ @ @ @ an analyst for LightShed Partners , was predicting a double-digit drop in the domestic box office .
A more selective consumer means there ’ s more pressure on the top 10 films to drive attendance , according to his Jan. 6 report .
“ As we look at the overall film slate for 2020 , we simply do not see the excitement that will drive top 10 attendance , ” Greenfield wrote .
Disney ’ s perhaps most-anticipated release is the live-action remake of “ Mulan , ” which is set in ancient @ @ @ @ @ @ @ As of Wednesday , teasers for the film were still promising a March 27 opening .
That said , a delay may be inevitable with Chinese theaters still closed and U.S. theaters starting to give off that petri-dish vibe .
The multiplex cinema companies are coming off of a spending spree that ’ s saddled them with debt .
AMC made a pair of $ 1 billion acquisitions in 2016 , buying Carmike Cinemas in the U.S. and Europe ’ s Odeon & UCI .
Cineworld took over Regal for $ 5.9 billion @ @ @ @ @ @ @ and in December agreed to buy Canada ’ s Cineplex Inc. for $ 2.1 billion .
They ’ ve also made expensive upgrades to their venues , adding more luxurious reclining seats and better food and drink options .
AMC , which like the others is rated below investment grade by credit agencies , had $ 10.1 billion of net debt as of December .
That was six times last year ’ s adjusted Ebitda .
There are more than 40 confirmed cases of Covid-19 in Washington state , where Cineworld operates more @ @ @ @ @ @ @ and Cinemark has 73 .
Likewise , in New York state , where there are now 13 confirmed cases , Cineworld has more than 500 screens , followed by AMC at 308 and a little more than a dozen for Cinemark .
For AMC and Cinemark , the biggest U.S. market is Texas , while Cineworld ’ s is California .
“ Health-related epidemics , such as flu outbreaks , could cause people to avoid our theatres or other public places where large crowds are in attendance , ” read Cinemark ’ s @ @ @ @ @ @ @ list of boilerplate-type risks that most people might gloss over during normal times .
Now that risk has become very real .
So much for all those costly theater renovations if nobody can even attend .


washingtonpost--2020-03-05--Analysis | Here’s a Contagion That Beijing May Be Able to Stop

This time , though , Beijing may be able to halt the kind of financial contagion that spread through the sector .
If Foxconn , the maker of Apple Inc. iPhones , Dell Technologies Inc. computers and Nintendo Co. games consoles , is any guide , then it ’ s possible the industry could make it through with few scars .
The 2008 collapse of America ’ s sub-prime mortgage market hurt manufacturing because sources of cash dried up even in Asia .
Beyond the drop in U.S. consumer demand , production in China ground to a halt as supply @ @ @ @ @ @ @ wheels of production , dried up when institutions cut back on lending or refused to extend existing funding .
Suppliers who relied on letters of credit couldn ’ t pay for their components , and their customers in turn didn ’ t have cash available to pay for goods that had already been shipped , let alone order more .
The well-oiled global industrial machine ground to a halt .
The impact on Hon Hai was swift and brutal .
Its current ratio — a measure of current assets as a proportion of @ @ @ @ @ @ @ record low , while its Altman ’ s Z Score , which tracks the likelihood of bankruptcy , plunged into dangerous territory .
Within a year , it posted a quarterly revenue drop of 11 % , still a record .
Its revenue decline this quarter is set to be even worse than back then .
If companies in the supply chain make it through this crisis relatively intact , it may be largely thanks to the government of China , where Foxconn has the majority of its production .
While its initial @ @ @ @ @ @ @ this coronavirus failed ( new cases are being recorded daily , with the scale outside of China climbing rapidly ) , Beijing may actually be able to halt the financial contagion .
To make it happen , lenders have been allowed to avoid recognizing defaults that result from the coronavirus outbreak while the financial regulator has asked banks to be more lenient on bad loans and to reduce their profit targets .
In other words : Forget these loans exist and don ’ t worry about making money .
Banks have taken Beijing @ @ @ @ @ @ @ News reported last week .
Efforts to alleviate the pain include rolling over loans that seem may miss payments , allowing debtors to skip interest installments , and refraining from reporting delinquencies so that borrowers credit scores don ’ t get hit .
It may be working .
Foxconn ’ s Liu , for example , noted that local governments see economic growth as important as fighting the disease that threatens it .
They ’ re prioritizing the reopening of some factories .
That ’ s a big reason why the sprawling empire @ @ @ @ @ @ @ production by the end of this month , from only 50 % at the start and essentially zero output in February .
Crucially , Foxconn won ’ t be alone in bearing the extra costs .
Perhaps the most important assistance , which Liu pointed to , are those measures being taken by Beijing to ensure money keeps flowing .
They ’ re sorely needed .
A survey last month found that a third of Chinese small and medium-size enterprises had only enough cash to cover fixed expenses for a month , while @ @ @ @ @ @ @ months .
Foxconn is China ’ s largest private employer and largest exporter .
It relies on thousands of suppliers to all be up and running , and as many as 1 million workers to turn up at its factories .
Despite what ’ s likely to be a record decline in revenue this quarter , the company expects full-year sales to be impacted by as little as 1 percentage point .


washingtonpost--2020-01-24--Analysis | It’s Hard to Pull Off 3 Billion Trips During a Pandemic

Little wonder , then , that the travel industry is suffering .
With the death toll up to 25 and more than 800 infected , tourists are staying home .
Some have no choice : The government has put seven cities on lockdown and airports are stepping up screening measures .
On Friday , China ordered all travel agencies to suspend sales of domestic and international tours .
Shares of China Southern Airlines Co. – the carrier most exposed to the site of the outbreak – have slid 14 % since the second death from the virus was confirmed , @ @ @ @ @ @ @ said it would waive fees for tickets to and from the mainland , has slumped 7.6 % .
The country ’ s largest online travel agency , Trip.com Group Ltd. has tumbled 12 % .
If the SARS outbreak of 2003 is any guide , things could get even worse .
In May of that year , Chinese air passenger traffic fell 71 % , according to Goldman Sachs Group Inc. Bernstein Research cited concerns of a repeat outcome when it cut Trip.com ’ s rating one notch to “ market perform ” @ @ @ @ @ @ @ , which changed its name from Ctrip.com last year , issued a statement Thursday saying it would refund travelers who ’ ve been diagnosed , or those in close touch with them .
The hope is that , like SARS , the turbulence will eventually pass .
For Trip.com , however , the business challenges are bigger than the coronavirus .
In recent years , the company has struggled to keep up with competition from digital rivals like Meituan Dianping and Alibaba Group Holding Ltd. Few travel companies have benefited more from China @ @ @ @ @ @ @ s biggest source of tourists in 2012 .
Despite the trade war and Hong Kong ’ s protests , ( 3 ) China ’ s outbound tourism numbers have continued to rise .
According to Euromonitor International , 108.39 million overseas trips were taken last year , a 9.5 % gain , after surging 11.7 % in 2018 .
Trip.com now makes up a quarter of its total sales from outbound Chinese visitors , from under 15 % five years ago , reckons Bloomberg Intelligence analyst Vey-Sern Ling .
But the hotel-booking sector @ @ @ @ @ @ @ recently overtaken Trip.com as China ’ s top site , just five years after the food-delivery giant started dabbling in the business .
Meituan now has 47 % of China ’ s market , ahead of Trip.com , with 34 % , according to TrustData .
Now , Meituan is moving further into Trip.com ’ s territory with luxury hotels , while chains like Marriott International Inc. are pushing for direct booking on their China websites .
Alibaba said part of the $ 13 billion it raised from its Hong Kong listing in @ @ @ @ @ @ @ online travel group site .
If there ’ s any lesson to be gleaned from all this , it ’ s the benefit of diversification .
While China ’ s superapp business model has arched some eyebrows ( how can one company possibly provide digital payments , taxis , food delivery , massages and pet grooming ? )
there ’ s a decent case to be made for having some crisis-proof subsidiaries .
Consider AirAsia Group Bhd , Southeast Asia ’ s most successful budget airline , which is setting up a regional @ @ @ @ @ @ @ be underway for Trip.com to diversify its investor base , with the company discussing plans to go public in Hong Kong , Bloomberg News reported earlier this month .
Here , Alibaba is a successful model .
With its second listing , the company is now closer to its Chinese end-users , and Alibaba ’ s New York-listed stock has soared 14 % .
The four-month span of the SARS outbreak shows how quickly things can turn around : While China ’ s growth dipped in the second quarter of 2003 , it @ @ @ @ @ @ @ Given how much more important the Chinese shopper is to the economy now , the damage could be more painful .
A 10 % fall in discretionary transportation and entertainment could shave 1.2 percentage points from China ’ s growth domestic product , according to “ back of the envelope ” estimates by S & P Global Inc. Hong Kong retailers and restaurants , just coming off the pain of last year ’ s protests , were already suffering .
For those companies that enjoyed the fast-rising Chinese consumer , it may be @ @ @ @ @ @ @